Investment planning is the key to success for any investor. At the same time, it is important that planning is comprehensive and covers all aspects of the proposed activity.
The difference between a business plan and an investment project is that the first often acts as one of the documents of the second, that is, its integral part. Very often, when implementing a small or short-term investment project, only a business plan can be drawn up.
In general, the difference from a business plan is that an investment project includes a volumetric justification for a wide range of tasks, including:
- commercial;
- production;
- economic;
- social, etc.
On the other hand, a business plan can be viewed as a program of activities for a project that is in operation or is just being developed.
The business plan contains:
- mission of the organization;
- the goals of the organization;
- the objectives of the organization;
- organization resources;
- task executors;
- key areas of work.
The most important task of a business plan is planning and forecasting the further development of the organization in a specific time period. Now let's try to consider both documents in more detail.
Investment project
An investment project is a complex set of measures aimed at creating new products, services, modernizing or reconstructing operating industries in order to obtain economic benefits.
The main goal of the investment project is to obtain investments. An investment project is a document developed at the stage of the project concept, that is, at the very first stage of the project's life cycle. Often in an investment project, a detailed plan of financial investments is not made, but a certain reserve of financial resources is simply laid down, on average in the amount of 10% -20% of the cost of the entire project.
Advice! The costs of an investment project can be calculated with a margin, but income must be carefully justified and calculated as accurately as possible.
Typically, an investment project includes a set of documents that define the goal and a list of planned actions aimed at achieving this goal. It is equally important to study all possible negative manifestations of external and internal factors that can harm the project and to develop mechanisms for solving predicted problems.
Internal factors influencing the development of an investment project include:
- management's attitude to decision-making at all stages of the project;
- potential and real production capabilities of the enterprise;
- the current financial condition of the enterprise and its ability to finance an investment project;
- the level of development of the organization's infrastructural capabilities.
External factors influencing include:
- the level of political stability;
- the level of economic stability;
- possible changes in the regulatory framework;
- the level of scientific and technological development;
- ecological problems.
An investment project is large-scale and often requires huge funds and several business plans for each private facility, which ultimately constitutes one large whole.
Business plan
Recently, it has become an independent document and is not necessarily associated with an investment project.
What is the difference between an investment project and a business plan:
- The business plan defines the practical actions related to the implementation of the investment project. In general, the structure of a business plan depends on the goals, objectives and requirements.
- The business plan begins with a project summary, which provides a brief description of the company and highlights the main positive aspects of the business idea.
- A mandatory item is a description of the enterprise, its products.
- In the marketing plan, an analysis of the strengths and weaknesses of the organization, used and proposed product promotion strategy is carried out.
- The production plan of the enterprise contains a description of the main technological processes for the production of products.
- The most important section of the business plan is the financial plan, which reflects the financial results of the enterprise, the proposed sources of financing, loan repayment schedules and other useful information.
- In any business plan, risks are necessarily spelled out (see) and possible losses from them.
- The appendix usually contains additional documents that allow you to get a more complete picture of the project.
Advice! It is not worth saving money when developing an investment project and a business plan. A good project is expensive, but it allows you to get a large return on invested capital due to a more thorough study of all project parameters by specialists. To make a good profit, you need to invest a significant amount. Quality investments generate quality returns.
Have you ever confused the term stage with the term process? And the term briefcase with the term final result? Probably not, but project management terminology can be confusing. This article will help you find answers to your questions.
In this article
Familiarity with the basics: stages, processes, portfolios and products
A project is simply a set of actions that occur according to a schedule and create some kind of output. Some projects are standalone, with a "No" attitude, other workers are transitioning into the organization. On the other hand, some projects are part of larger activities such as phases, processes, programs and portfolios.
Stages
Projects can be planned based on stages, which allows you to jointly manage multiple projects related to the same goal. Suppose a charitable organization has to fundraise every year. To manage all projects related to this task, the charity divides projects into three phases: planning, event, and follow-up. Each stage contains several projects.
Stage | Projects | Stage result |
|---|---|---|
|
Planning |
Room reservation Selecting presenters and obtaining consent from them Inviting participants |
Event plan document |
|
Event |
Room preparation Helping a guest speaker Accompanying the participants |
Carrying out the event in accordance with the plan |
|
Further actions |
Participant poll Collecting notes on further actions |
Event Analysis Document |
Processes
Activities in two different projects can be interrelated; thus formed processes... Let's say there are two projects: one contains the activities needed to develop a technical issue tracking system, and the other contains the activities for hiring and training support personnel.
The combined set of activities from the two projects forms the process of creating a call center. The result of the process is a fully operational call center.
Programs
Program is a group of projects that are managed together to effectively use their relationship. For example, a construction company that is working on a new neighborhood manages each house in the neighborhood as a separate project. Grouping projects into a neighborhood program makes it easy to track the progress of the entire neighborhood and plan for outsourcing, such as cement trucks or landscaping contractors.
Briefcases
Some project managers may use portfolios to align projects and programs with their respective strategic business objectives. For example, a software company has identified three strategic business goals: Industry Innovation, Secure Software Development, and Superior Customer Support. The organization creates portfolios for each of these goals (Innovation, Safety, and Support) and compares current projects and programs against them.
Briefcase | Projects and programs |
|---|---|
|
Innovations |
Project: competitive analysis Program: industry training |
|
Security |
Project: security check Program: server registration system implementation |
|
Support |
Project: deployment of a system for tracking technical problems of the call center Project: recruiting and training call center personnel Program: web resources for clients |
Final results of the project
Projects, stages and processes lead to some result, which is called the end result... Typically, the end result is a specific tangible item, such as a document or finished product. The end results can be not only products and goods, but also results or services. The following table lists some examples of these types.
End result type | Description | Examples of |
|---|---|---|
|
A tangible item that is the result of a project, stage, or process. Products can be stand-alone deliverables, or they can be part of larger deliverables. |
Document, attachment, home |
|
|
Result |
The result of the completion of a project, stage or process. |
Revised bug tracking process, new organizational structure, green building guidelines |
|
The result of a stage, project, or process that enables an organization to fulfill its business functions. |
Fully operational call center, gathering all participants at the conference, radio dispatcher service |
Microsoft Project and the existing project management system
Stepping even further, the project management "system" refers to an integrated set of processes, techniques, methodologies, and tools that are used to plan and track projects. Microsoft Project is a tool within a larger project management system. Projects, also called project plans, will be saved as separate files within Project 2010 and can be grouped into larger events such as phases, processes, programs, and portfolios.
You can reach your destination only when the course of movement is correctly set, and all participants know where and why they are going. The project and program are categories of Western management, where special attention is paid to competent planning. How to understand the difference between them and what are the differences?
Definition
Project- an interconnected set of activities and processes, the main goal of which is the implementation of a large-scale task. Its main attributes are the availability of deadlines, resources, mission. The implementation of the project can be calculated quantitatively as well as qualitatively (the set goals have been achieved or failed).
Program- a group of projects united by a common goal, management, resources, mission. Their result is a qualitative change in state caused by the implementation of the planned tasks. The healthcare development program involves the implementation of a number of projects: the construction of hospitals, research, staff training and much more.
Comparison
So, the most important difference between these concepts is their scale. The program is several projects united by one goal. It is not measured quantitatively, but qualitatively and involves a change in state. The timeframe for the implementation of the project, as a rule, is rigidly determined, and their postponement will inevitably affect the implementation of the program.
There are also differences in the complexity of the implementation of the tasks set. The implementation of the project seems to be easier, since for success it is enough to achieve the goals by a certain period of time. The program is just a hypothesis (the fight against alcoholism or drug addiction), which must be confirmed in practice. Not always interconnected projects and their successful implementation lead to a change in state, and the result may be completely unpredictable.
Conclusions site
- The scope of the concept. A program is a broader concept that includes a set of projects.
- Duration. The timeframe for the implementation of the program is broad, the project is specific and measurable.
- Result. The project is implemented when the planned activities are completed by the specified date. The result of the program is a change in state, an impact on the situation. Thus, even its partial implementation may be successful, and the resulting effect may exceed all expectations.
- Complexity. The implementation of the program is more difficult than the implementation of the project, since all the components of the task need to be coordinated.
Program (English - Program)- within the framework of project management, this is a sequence of interconnected projects, managing which it becomes possible to centrally coordinate them in order to achieve a degree of controllability and benefits, which is not available when managing projects separately.
Some programs may include elements of work related to these programs, but at the same time lying outside the scope of the projects of this program. The project may or may not be included in the program, while the program always contains projects.
The centralized and coordinated management of multiple projects to achieve the company's strategic goals and program benefits is defined as program management. Through the achievement of common goals and joint functionality, projects should be linked together in the program. Projects that have a link only in the presence of a common client, technology or resource should be regarded as a portfolio of projects.
Program management needs to focus on project dependencies and form an optimal management approach. For this, the following approaches are used:
- resource restrictions are removed and / or the program manager seeks to resolve conflicts that affect some projects within the system
- the coordination of the organizational / strategic direction is carried out, focused on the goals and objectives of the project and program
- within the framework of the general management structure, the program manager resolves issues and carries out change management
Program management in the classical sense came from the management of large programs of the US defense complex (field of aerospace development - NASA - American National Aeronautics and Space Administration). To manage the program, an experienced leader is appointed, in parallel with this appointment, appointments of managers are made for each project included in this program. Combining related projects into programs is ultimately useful because it becomes possible to manage all the resources of the program projects, consolidate data from all projects, develop common approaches, reallocate funding between projects, etc.
Similarities and differences between programs and projects
In some cases, programs do not have their own life cycle, since consist of several projects, each of which has its own life cycle. Programs differ from projects in longer duration and can have unlimited duration, because some projects of the program are being completed and some are being added. As for the program manager, this is a long-term position, in contrast to the project manager. Projects within programs and operations within projects are in some cases related to each other in three ways:
- Through the result of the operation. The end result of a particular activity is the input to another activity in that or a related project.
- Through a common unit of resources. The assigned resource for a specific job will not be able to proceed to the next job of that project or a related project until it finishes the current job.
- Through the rate of expenditure of common resources. Projects become dependent on each other when the consumption of some resources exceeds the capacity of the common pool. overall resources are ultimately limited.
You can reach your destination only when the course of movement is correctly set, and all participants know where and why they are going. The project and program are categories of Western management, where special attention is paid to competent planning. How to understand the difference between them and what are the differences?
What is a project and program
- Project- an interconnected set of activities and processes, the main goal of which is the implementation of a large-scale task. Its main attributes are the availability of deadlines, resources, mission. The implementation of the project can be calculated quantitatively as well as qualitatively (the set goals have been achieved or failed).
- Program- a group of projects united by a common goal, management, resources, mission. Their result is a qualitative change in state caused by the implementation of the planned tasks. The healthcare development program involves the implementation of a number of projects: the construction of hospitals, research, staff training and much more.
Difference between project and program
So, the most important difference between these concepts is their scale. The program is several projects united by one goal. It is not measured quantitatively, but qualitatively and involves a change in state. The timeframe for the implementation of the project, as a rule, is rigidly determined, and their postponement will inevitably affect the implementation of the program.
There are also differences in the complexity of the implementation of the tasks set. The implementation of the project seems to be easier, since for success it is enough to achieve the goals by a certain period of time. The program is just a hypothesis (the fight against alcoholism or drug addiction), which must be confirmed in practice. Not always interconnected projects and their successful implementation lead to a change in state, and the result may be completely unpredictable.
The difference between a project and a program is as follows:
- The scope of the concept. A program is a broader concept that includes a set of projects.
- Duration. The timeframe for the implementation of the program is broad, the project is specific and measurable.
- Result. The project is implemented when the planned activities are completed by the specified date. The result of the program is a change in state, an impact on the situation. Thus, even its partial implementation may be successful, and the resulting effect may exceed all expectations.
- Complexity. The implementation of the program is more difficult than the implementation of the project, since all the components of the task need to be coordinated.
