Project evaluation is an integral part of the planning process. At the stage of preparation of projects, it implies examining the relative profitability of a project vis-à-vis other projects to enable planners in the choice of priority projects. Thus projects are appraised before they are actually put into operation. But project evaluation does not end here. The projects are also appraised during their execution in order to find out their operational success or otherwise. At the operational or the implementation stage, the objective of project evaluation is to suggest remedial measures and point out appropriate steps to improve upon its working.
Lastly exercise is repeated at the end of completion of a project. This post completion appraisal of projects is undertaken to find out whether all ends have been achieved in Toto or project is a partial success only. What are the lessons to be learnt? How mistakes can be met and unexpected difficulties can be surmounted?
Present performance must act as an essential aid to future policy which may be immunized against the recurrence of similar mistakes. Projects evaluation is thus involved throughout various stages of formulation, implementation, completion and post completion analysis of projects.In the end of every project must ultimately be accepted or rejected on the basis of a subjective judgement about its worth.
Project evaluation can be thus be defined as an objective and systematic analysis of individual projects to determine their relative profitability, operational working and their performance and monitoring of the ultimate results. The objective of project evaluation is of course the judicious, efficient and optimal use of scarce resources, avoidance of wastages and ensuring their on schedule completion.
In order to achieve maximum results, projects must be well conceived, meticulously planned, carefully implemented leading to their successful fruition. In majority of the underdeveloped countries proper attention is not paid to preparation and appraisal of projects and those in position of authority take the instantaneous improvisation of projects and their thoughtless operation and implementation.
This is entirely due to their non serious attitude; perhaps their capacity to prepare and analyze projects is also deficient. Thus it is neglect coupled with the lack of necessary skills which can be held responsible for the rampant misconceived and ill planned projects in the underdeveloped world.
So there are number of important aspects which should merit attention of those engaged in project evaluation. Their importance varies depending upon the character of a project but all need to be carefully considered.
Three are three main criteria or techniques used for project evaluation. Project evaluation undertaken will be of the first stage or kind in which projects are proposed to be ranked in priority in order to facilitate choice on the part of the responsible authorities. It may be clarified here that the responsible authorities. It may be clarified here that while project evaluation is the job of technical here that while project evaluation is the job of technical staff of a planning agency, the actual choice of projects consistent lies with the political bosses or authorities. While the first is a technical assignment, the latter is largely a political decision.
The political overloads are not bound by the technical decision and may be more influenced by non economic factors in their choice of projects. But projects evaluation is even then useful as it apprises the political bosses of the economic cost of such decisions to the economy as a whole.
Projects may be selected and ranked on the basis of inspection. For example, if two projects produce the same net values of production for a period but one continues to earn longer than the other, then the first will be preferred over the over the second.
In the Economic development is the ultimate end of planning and projects are means to that end. If development is the target, then a project is an arrow with which to hit that target. If development is a goal to be reached, then projects are carries which take the economy to that goal. Thus projects are instrumental in attaining the objectives of development planning.
They are also termed as the cutting edge of development. A project is sometimes defined as an activity on which money is spent in expectation of returns and which logically seems to lend itself to planning, financing and implementation as a unit. Thus a project involves s following essentials:
An Expenditure or a spending activity.
Expectation of returns or profits; the expenditure is not for charitable purposes.
The activity is planned, financed and implemented as a unit and a unity, is not a feature of a project.
A project is also sometimes referred to the whole complex of activities involved in using resources to gain benefits. According to yet another viewpoint a project is a specific activity with a specific starting point and a specific objective. Thus it is a four dimensional activity in specifics. So it is to complete a task.
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