Ch-3 Classification of projects.pptx notes
- 2. PROJECT DEFINITION A project is defined as a “temporary endeavor with a beginning and an end and it must be used to create a unique product, service or result”. A project is a series of tasks that need to be completed in order to reach a specific outcome.
- 3. CLASSIFICATION OF PROJECTS Scope and Significance National Social International Technology Conventional Non- Conventional High tech Low Investment Size and Scale large medium small Purpose Balance Maintainence Modernisation Diversification R and D Ownership Public Private Joint
- 4. Basis of scope and ownership National- Project undertaken by govt or given to a private entrepreneur in a country.For eg, construction of dams, bridges. International- Projects undertaken by foreign investors. For eg, MNCs. Social- These kind of projects are undertaken to provide benefits to large. For eg, health care services,etc.
- 5. Basis of level of technology Conventional- These projects uses well established and known technology. Non Conventional- They uses contemporary mode of technology. High tech projects- Huge investments are made in these kind of projects. Example- space and nuclear projects. Low Investment Projects- This kind of projects needs less amount of investment. Example- Production of soaps,etc.
- 6. Basis of Size and Scale Small scale- that can be completed within one or two years and requires investment below 5 crore. Medium scale- That type of projects should be completed within 5 years and requires investment upto 10 crore. Large scale- that can be completed in 5-10 years and requires investment over and above 100 crore.
- 7. Basis of purpose Balanced- these projects are undertaken to cope with change in supply side. Maintenance- these projects’s objective is to upkeep the existing plant and machinery. Modernization- Modernization is required to cope up with changing environment. Diversification- when an enterprise decides to produce new products/services to enter into a new geographical area. R and D- This kind of projects are made to develop new products and process which improves the technological standing of company.
- 8. Basis of ownership Public- Projects which are fully owned and controlled by Govt. Private- projects which are fully owned and controlled by Private individual. Joint- projects which are owned and controlled by govt and private individuals.
- 9. Project National Non-Industrial Industrial Non- Conventional/R&D High Technology Mega Major Grass Root Expansion Normal Crash Disaster Modification Medium Mini Conventional Technology Low Technology International Categories of Projects
- 10. INTERNATIONAL PROJECT The projects which are undertaken by the foreign investors by establishing branches of their own unit. These are in the form of MNCs and joint venture. NATIONAL PROJECT Projects undertaken either by the government itself or assigned to the private entrepreneur in a country. The purpose of such projects is groeth & development of economy, removal of poverty, employement or increase standard of living. These are divided into 2 categories:- 1) Non- Industrial projects These are undertaken to facilitate the promotion and acceleration of overall economic development. 10
- 11. 2) Industrial projects Also referred as commercial projects, which are undertaken to provide goods or services for meeting the growing needs of the customers and providing attractive returns to the investors/stake holders. Industrial projects are futher divided into 4 categories :- 1) Conventional technology projects These are projects which use well establishes and known technology in the continuous process. 2) Low technology These type of projects demand low investment in the technology.
- 12. 3) Non- Conventional Project/ R & D Such type of project apply not the latest but at least contemporary mode of technology. Eg – Project using cranes. 4) High technology In these type of projects huge investments are made on the technology. eg- project using cranes. These are further classified into four types : Mega high technology, Major high technology, Medium high technology and mini high technology project.
- 13. 1. Mega High Technology project It is a project that combines several key technologies that do not fully exist at the starting point of the project. The assumption is that these technologies will be successfully developed and proven as the project evolves and that, at the end of the project they will be mature enough to be integrated into the system. Needless to say, these projects are the most advanced in terms of technology. Examples of this project are- Sidewinder, SR-71, Eagle computer. 2. Major High Technology Project It is defined as a project in which several new key technologies are integrated. It is important to note, however, that all these new technologies basically exist inhouse, or can be acquired from an outside source prior to the project’s initiation. No new technology has to be developed, tested or proved during the life-cycle of the project. For example- F-16, First VCR, Macintosh 13
- 14. 3. Medium High Technology This is the most common type of industrial project. It involve some new technology or some feature that add a certain level of uncertainty to the project. Examples could be a new model or a different design of a previous product ( like in the automobile or the consumer electronics industries), incorporating some new features or process, or adding a single technology which is relatively new. Other examples may be improvement projects of an existing product like aircraft or vessel upgrading. Since projects of this type are based largely on previous knowledge and accumulated experience, almost all of the key technologies are available in advance. For example- Autos, Tvs 4. Mini High Technology Mini technology represents those projects that involve new technology and is the simplest form of industrial project. Almost everything in these projects is fairly well known in advance, and can be specified completely before initiation of the project. Example of this type of category are construction of bridges, road building or the installation of a new telephone network. 14
- 15. 15 Major High Technology industrial project is classified into three categories: Grass root, Expansion and modification. 1. Grass Root Grass root is at the most basic level of something, down here in the dirt with the roots of an idea or an activity. 2. Expansion 3. An expansion project is literally any project that works to expand the reach of a company. It involves producing new products or moving into new markets . 3. Modification It means any construction or modification of the project that alters, impairs, expands, or limits the project’s ability.
- 16. Expansion is further categorized into normal, crash and disaster project. 1. Normal project In this category, adequate time is allowed for implementation of the project. This type of project will require minimum capital cost and no sacrifice in terms of quality. 2. Crash Project In this category, additional capital costs are incurred to gain time. Maximum overlapping of phases is encouraged and comprises in terms of quality are also not ruled out. 3. Disaster Project Anything needed to gain time is allowed in these projects. Engineering is limited to make them work. 16
- 17. Types of projects 1) Quantifiable and Non quantifiable projects In a quantifiable project, it is possible to measure the end benefits of outcomes of the project. In non-quantifiable end result cannot be calculated properly. 2)Sector project The planning committee of india has classfied projects for various sectors. - Agriculture sector - Irrigation & power sector - Transport & communication - Social services 3) Techno-Economic project Here projects are classified on the basis of technology & economic characteristics. a) Factor intensity oriented classification - In this category, projects are either capital intensive or labor intensive depending upon their size & investment pattern. 17
- 18. b) Cause oriented In this category, projects are based on either the availability of raw material or demand for that project. c) Magnitude oriented classification In size of investment forms the basis of classification. Projects may thus be classified into small, medium or large scale projects. 4) Financial institutions classification All India and state financial institutions classify the projects according to their age and experience and the purpose for which the project is being taken up, they are as follows:- a) New projects b) Expansion projects c) Modernization projects d) Diversification projects 18