FBMED

I. Business Environment (Part 1)

1. Introduction & Meaning of Business:

Think of business simply as any human activity done regularly with the main goal of
making a profit.
How does it make a profit? By producing, buying, selling, or distributing goods (like
phones, clothes) or services (like banking, haircuts).
Business is essential to society because it provides the things we need and want.
2. Characteristics of Business: What makes an activity a "business"?
Deals in Goods & Services: Businesses offer either physical products (consumer
goods like groceries, capital goods like machinery) or intangible services.
Sale or Exchange: The core idea is to sell or exchange these goods/services, not just
produce them for personal use. Someone either makes the goods or buys them with
the intention to sell.
Regularity: It's not a one-off thing. Business involves producing, buying, or selling on
a consistent basis. Selling your old bike isn't a business, but running a bike shop is.
Profit Motive: The primary aim is to earn money through profit. While other goals
exist, profit is fundamental for survival and growth.
Risk & Uncertainty: There's no guarantee of profit. Businesses face risks (like
changing customer tastes, competition) and uncertainty, meaning income isn't always
stable or predictable.
3. Evolution of Business (in India):
Business isn't new in India; trade concepts date back thousands of years (around 5000
B.C.). India had a well-developed economy and trade, both domestically and
internationally.
Initially, people produced mainly for themselves (self-consumption). As needs grew,
people started producing more than they needed (surplus) and began exchanging
these surplus items for things they lacked.
India was famous for goods like textiles and jewelry. Associations of merchants
(Guilds) existed. Currency has been used for a long time.
After independence, India focused on producing goods domestically. Export and
import were already established concepts. The British initially entered India as traders.
4. Classification of Objectives of Business: Businesses have multiple goals:
Economic: Earning profit, creating and keeping customers, constantly innovating to
adapt to changes, and using resources (Man, Materials, Money, Machines - the 4 Ms)
efficiently.
Social: Providing quality goods/services at fair prices, and contributing to the general
welfare of society (e.g., supporting schools, hospitals).
 Human: Taking care of employees by offering fair wages and benefits, ensuring job
satisfaction, and providing opportunities for skill development and training.
National: Creating jobs, promoting social justice (equal opportunities), producing
goods aligned with national priorities, paying taxes to contribute to government
revenue, and promoting self-sufficiency while boosting exports.
Global: Helping raise the standard of living worldwide by offering quality goods,
reducing economic gaps between rich and poor nations through business operations,
and producing goods that are competitive globally to earn foreign exchange.
5. Nature of Business:
It's an occupation involving producing/selling goods and services for money.
It's done regularly with the goal of profit.
Activities include things like mining, manufacturing, transport, banking, etc..
Businesses vary in size, from small shops to large corporations.
6. Purpose & Scope of Business:
Purpose: Beyond profit, business creates jobs, offers a better quality of life,
contributes to national economic growth, and is crucial for society. Businesses need
society, and society needs business.
Scope (Impact/Reach): Improves living standards, provides employment, uses
national resources efficiently, enhances national image through quality exports,
allows access to international quality goods, gives returns to investors, promotes
social interests (like tourism), facilitates cultural exchange, and helps develop science
and technology through R&D investment.

II. Internal and External Environment

The business environment refers to all the factors, forces, and conditions that influence how
a business operates and makes decisions. Recognizing these is crucial for planning and
managing risks.

1. Features of Business Environment:

Totality of External Forces: It includes everything outside the business firm. It's the
sum total of many things.
Specific and General Forces:
Specific forces directly affect a particular business daily (e.g., customers,
competitors, suppliers).
General forces affect all businesses indirectly (e.g., social trends, economic
conditions, political climate).
Dynamic Nature: The environment is always changing (e.g., new technology,
changing customer preferences, new competitors).
2. Types of Environmental Factors: The environment is broadly divided into two categories:
A. Internal Environment: These are factors within the company that affect its
operations. They are generally controllable by the business. Key internal factors
include:
Value System: The core beliefs, ethics, and goals that guide the company's
behavior.
Mission, Vision, and Objectives: The company's purpose (mission), future
aspirations (vision), and specific targets (objectives).
Management Structure and Nature: How the organization is structured and
how decisions are made.
Internal Power Relationships: The coordination and relationships between
different management levels (Top/Strategic, Middle/Tactical, Lower/Operational).
Human Resources: The skills, attitudes, morale, and commitment of the
employees are crucial strengths or weaknesses. The organizational culture often
depends heavily on its people.
Physical Assets and Facilities: Things like production capacity, technology used,
and the condition of equipment influence competitiveness.
R&D and Technological Capabilities: The ability to innovate and develop new
products/processes.
Marketing Resources: Factors like brand image, quality of marketing team, and
distribution network strength.
Financial Factors: The company's financial health, policies, capital structure, and
access to funds.
B. External Environment: These are factors outside the company. They are generally
uncontrollable by the business but still influence it significantly. It's divided into two
sub-levels:
i. Micro Environment (or Task Environment): Factors that have a direct bearing
on the company's operations.
Suppliers: Provide necessary inputs like raw materials. Reliable suppliers are
vital.
Customers: The reason the business exists. Understanding and satisfying
customers is key. Businesses must choose customer segments strategically.
Marketing Intermediaries: Middlemen like agents or retailers who link the
company to the final customers.
Competitors: Other businesses offering similar products or services.
Financiers: Institutions or individuals providing funds; their policies and
attitudes matter.
Public: Groups like media or citizen action groups that have an interest in
the company's activities.
ii. Macro Environment (or General Environment): Broader societal forces that
affect the entire micro-environment and are largely uncontrollable. Success
often depends on adapting to these.
Economic: Factors like the economic system, business cycles, inflation,
interest rates, income levels.
 Social/Socio-Cultural: Society's values, beliefs, customs, traditions,
language, education levels, buying habits, work culture. Examples include
different tastes for coffee (Nestle) or varying interpretations of colors
across cultures.
Political: Government stability, political party ideologies, bureaucracy, laws,
and regulations.
Legal: Laws and regulations governing business, including court decisions.
Technological: Pace of technological change, R&D activity, automation,
determining product quality and influencing investment.
(Other factors sometimes included): Demographic (population
characteristics) and Global factors.

Understanding both the internal strengths/weaknesses and the external

opportunities/threats is essential for strategic decision-making.

III. Environmental Scanning

Environmental scanning is like the business's radar system. It's the process of actively
gathering and analyzing information about both the internal and external environments to
understand events, trends, opportunities, and threats that could affect the business. The
main goal is to figure out the future prospects and make informed decisions.

1. Characteristics of Environmental Scanning:

Continuous Process: It's not a one-time task. The environment keeps changing, so
scanning must happen constantly.
Exploratory Process: It involves looking for potential future possibilities and unknown
factors, focusing on "what could happen" rather than just "what will happen".
Dynamic Process: The scanning process itself adapts based on the changing
situation.
Holistic View: It looks at the entire environment, not just isolated parts.
2. Components of Environmental Scanning: What does it scan?
Internal Environment: Factors within the organization (like human resources, capital,
technology) that affect performance.
External Environment: Factors outside the organization. These are further divided
into:
Microenvironment: Competitors, consumers, suppliers, markets.
Macroenvironment: Political, legal, economic, cultural, technological,
demographic factors.
3. Techniques/Methods for Environmental Scanning: How is it done?
SWOT Analysis: Analyzing Strengths (Internal), Weaknesses (Internal), Opportunities
(External), and Threats (External) to guide strategy.
PEST Analysis: Analyzing Political, Economic, Social, and Technological factors in the
external macro-environment. (Variations like PESTEL add Environmental and Legal
 factors).
ETOP (Environmental Threat Opportunity Profile): Analyzing the impact of
environmental factors specifically in terms of threats and opportunities.
QUEST (Quick Environmental Scanning Technique): A faster, less expensive method
to identify critical issues quickly.
4. Process of Environmental Analysis: The steps involved.
Scanning: Identifying early signals of potential environmental changes or factors that
might impact the business.
Monitoring: Tracking specific trends, events, or factors identified during scanning
using data gathered from various sources (publications, customers, suppliers,
employees, even spying).
Forecasting: Predicting the future direction of trends or events based on the
monitored data.
Assessment: Determining the implications of the forecasted trends/events – do they
represent opportunities or threats for the business?.
5. Need and Importance of Environmental Scanning: Why do it?
Goal Accomplishment: Helps organizations adapt to changes needed to achieve their
goals.
Threats and Weakness Identification: Allows businesses to spot potential dangers
and internal weaknesses early and develop strategies to counter them.
Future Forecast: Helps anticipate future events and make better strategic decisions,
even though the future is unpredictable.
Market Knowledge: Keeps the business aware of ongoing market changes so it can
adapt.
Focus on the Customer: Makes the organization more sensitive to changing
customer needs and expectations.
Opportunities Identification: Helps spot potential opportunities that can be
exploited.
6. Limitations of Environmental Scanning: Potential downsides.
Information Overload: Too much data can sometimes lead to indecision.
Doesn't Eliminate Uncertainty: It can't predict the future perfectly; unexpected events
can still happen.
Can Cause Delay: The analysis process might sometimes delay decision-making if not
managed strategically.
Reliability Issues: Relying completely on analyzed information without verifying its
accuracy can lead to poor outcomes.

IV. Impact of Social, Legal, and Political Environment

This section delves deeper into specific parts of the macro-environment and how they affect
business operations.
1. PEST / PESTEL Analysis:
Definition: PEST is a framework to analyze key external macro-environmental factors:
Political, Economic, Social, and Technological. It helps businesses understand the 'big
picture' forces affecting them. An earlier version was ETPS (Economic, Technical,
Political, Social).
PESTEL: This is an expanded version adding Environmental (or Ecological) and Legal
factors. Sometimes 'I' for Industry level factors is also added (PEST(ELI)).
Factors Breakdown:
Political: Government policies, tax rules, trade regulations, political stability,
leadership changes.
Economic: Inflation, interest rates, exchange rates, economic growth,
unemployment.
Social: Cultural trends, lifestyle patterns, age distribution, consumer behavior.
Technological: New inventions, automation, R&D, technological awareness.
Environmental: Climate change issues, environmental regulations, waste
management, consumer environmental awareness.
Legal: Labor laws, consumer protection laws, health & safety rules,
import/export regulations.
Advantages: Simple framework, helps understand the wider environment, encourages
strategic thinking, spots future threats and opportunities, helps avoid doomed
actions.
Disadvantages: Can be oversimplified if not enough data is used, needs regular
updates, requires input from different perspectives, accessing quality data can be
costly/time-consuming, rapid change makes prediction hard, risk of 'paralysis by
analysis' (too much data), analysis might rely on flawed assumptions.
2. Culture:
Definition: Culture is the shared, learned set of behaviors, beliefs, values, and
attitudes of a particular group or society. Society and culture are closely linked.
Approaches to Study:
Anthropological: Studying humankind; culture can be deep-seated and appear
strange to outsiders, but understanding the reasons behind behaviors is
important.
Maslow Approach: Using Maslow's hierarchy of needs (physiological, safety,
social, esteem, self-actualization) to understand how needs drive behavior in
different cultures.
Self Reference Criterion (SRC): The unconscious tendency to use one's own cultural
values and experiences to understand and evaluate market needs in a foreign culture.
This can block accurate perception. Lee suggested a 4-step approach to overcome it:
define the problem using home-culture norms, define it using foreign-culture norms,
isolate the SRC influence, and redefine the problem without SRC bias. Problems with
SRC include hidden cultural aspects and difficulty uncovering foreign cultural
nuances.
 Diffusion Theory: Explains how new ideas or products spread through a society over
time. The adoption often follows a pattern (like a bell curve).
Impact on Business: Culture influences everything: people's attitudes, what
goods/services are desired, language, family structures, education, aesthetics (sense
of beauty), religion, and social organization. Businesses need to understand these
cultural factors to succeed, especially in global markets.
3. Political Environment:
Nature: This is often less predictable. Changes in government or policies can
significantly impact businesses.
Importance of Monitoring:
Stability: Affects market attractiveness. Instability can lead to disruptions.
Legislation: Governments pass laws affecting relationships with customers,
suppliers, etc..
Social Reform: Governments may use businesses to drive social change.
Public Interest: Governments act to protect the public.
Economic Influence: Government actions (taxes, spending) affect the economy.
Major Consumer: Government itself buys goods and services.
Influence on Values: Government policies can shape social/cultural norms.
Key Factors: Impact on the economy (taxes, spending), regulatory changes, political
stability, and the need for businesses (especially international ones) to mitigate
political risk (e.g., through insurance).
4. Legal Environment:
Government Control: Governments regulate business activities.
Areas of Regulation:
Controlling Production: Banning or limiting certain goods (e.g., dangerous drugs,
weapons).
Employee Protection: Laws against unfair discrimination (race, religion, sex, age)
in hiring and work, ensuring fair wages and working hours, protection against
unfair dismissal.
Health and Safety at Work: Laws to protect workers from hazards (dangerous
machinery, unsafe temperatures, poor hygiene) and ensure adequate breaks and
safety equipment.
Consumer Protection: Laws ensuring businesses act fairly towards consumers
(e.g., accurate weights and measures, truthful product descriptions, fair credit
agreements, selling legal goods).

These social, political, and legal factors create the rules and norms within which businesses
must operate.

V. Impact of Demographic, Economic, and Technological Environment on Business

This section focuses on three more key components of the macro-environment.

1. Demographic Environment: This refers to the characteristics of the human population,
such as size, density, distribution, and growth rate. It directly affects the demand for
goods and services.
Key Demographic Factors:
Population Size & Growth: Changes due to birth rates, death rates, and
migration. High population growth might mean higher demand for certain
products (like baby products if birth rates are high ) and potentially easier
availability of labor.
Age & Sex Structure: The balance between males and females and the
distribution across different age groups. Different age groups have different
buying habits (e.g., younger people often adopt new tech first ). An aging
population (like in some Western countries) has different needs than a
predominantly young population.
Income: How much disposable income people have affects their purchasing
power. Businesses target products towards specific income groups or use
strategies like discounts for lower-income groups.
Ethnicity: Businesses may focus on the needs and preferences of different ethnic
groups within a population.
Geographic Region: Buyer needs often vary by location (e.g., preferences for
certain food flavors).
Other Factors: Household size, education level, occupation, race, employment
status are also considered.
Obtaining Info: Demographic data is often collected via market research surveys
(phone, mail, internet, in-person).
Advantages: Helps businesses Focus their efforts, build appropriate Branding and
Strategy, and track Trends.
Disadvantages: Risk of making wrong Assumptions about culture, demographics are
constantly Changing, and focusing too narrowly might lead to Customer Loss.
2. Economic Environment: Consists of external economic factors influencing a business.
Micro-economic Factors: Affect individual business decisions (actions of firms and
consumers). Examples include: market size, specific demand and supply for your
product, competitors' actions, suppliers, and the distribution chain (like retailers).
These are less broad and don't necessarily affect the whole economy.
Macro-economic Factors: Affect the entire economy and all participants. Examples
include: interest rates, taxes, inflation, currency exchange rates, overall consumer
income and spending habits, savings rates, consumer confidence, unemployment
rates, recession/depression cycles.
Key Factors Affecting Business (Summary): Stage of the business cycle, inflation rate,
interest rates, unemployment level, labor costs, disposable income levels, taxes,
tariffs.
3. Technological Environment: This exerts considerable influence on business.
 Definition: Technology is the systematic application of scientific or other organized
knowledge to practical tasks. It includes both 'hard' technology (machinery,
equipment) and 'soft' technology (processes, systems).
Factors Affecting Business:
Organizational Change: Technology can force changes in how organizations are
structured and operate.
Business Processes: New technologies can dramatically alter how work gets done.
Competitive Advantage: Technology can be a source of sustainable competitive
advantage (SCA).
Costs: Implementing new technology involves costs, but it can also lead to cost
savings.
Efficiency: Technology often improves operational efficiency.
Information Security: New tech brings new security challenges and the need for
contingency planning.
Communication: Technology greatly improves internal and external
communication.
Business Growth: Technology can open up new markets and increase business
potential.

Understanding these demographic shifts, economic conditions, and technological

advancements is vital for businesses to adapt and thrive.

VI. Industrial Policy and Export-Import Policy

This section deals with government policies specifically aimed at guiding and controlling
industries and international trade.

A. Industrial Policy

Think of industrial policy as the government's blueprint for how industries should be
established, function, grow, and be managed within the country. It sets the direction and
rules for industrial development.

1. Objectives of Industrial Policy: Why have one?

To balance industrial development and diversify industries.
To channel scarce resources towards national priorities.
To define roles for public sector, private sector, large industries, and small industries.
To prevent monopolies and concentration of wealth.
2. Key Industrial Policies in India (Historical Overview):
1948 Policy: Introduced after independence, it classified industries into four types:
exclusive government monopoly (e.g., atomic energy, railways), government-led new
ventures (e.g., aircraft, shipbuilding), private industries under state control, and other
private industries subject to general state control. It also mentioned small-scale
industries, labor relations, foreign capital, etc..
 1956 Policy: Reclassified industries into three schedules:
Schedule A: Exclusive state responsibility (e.g., arms, atomic energy, iron & steel).
Schedule B: Progressively state-owned, where private sector could supplement
state efforts (e.g., aluminum, essential drugs, transport).
Schedule C: Remaining industries left primarily to the private sector.
1991 Policy (Liberalization Era): Announced under PM P.V. Narasimha Rao, this policy
brought drastic changes.
Key Changes: Significantly reduced industrial licensing requirements ('License
Raj'), ended many public sector monopolies, and adopted a more welcoming
approach to foreign investment and technology.
Objectives: Promote self-reliance, Indian entrepreneurship, productivity,
employment, indigenous technology (R&D), remove regulations, increase
competitiveness, support small scale sector, improve PSU efficiency, protect
workers, and link India to the global economy.
Areas Covered: Industrial licensing, Foreign investment (allowed up to 51%
equity in high-priority industries with easier clearance ), Foreign technology
agreements, Public Sector Policy (focus on strategic areas, allowing private entry,
professionalizing PSU boards, protecting affected workers, offering shares to
public/institutions ), and changes related to the MRTP Act.
MRTP Act (Monopolies and Restrictive Trade Practices Act): Previously, this act
required large companies ('monopoly houses') to get government approval for
expansion, mergers, takeovers, etc.. The 1991 policy significantly reduced the
scope of the MRTP Act's pre-approval requirements.
Merits: Opened up the economy, boosted competitiveness, freed entrepreneurs
from excessive bureaucracy allowing quicker decisions, and attracted foreign
investment and technology.

B. Export-Import (EXIM) Policy / Foreign Trade Policy (FTP)

This policy focuses specifically on regulating and promoting international trade (exports and
imports).

1. Objectives of EXIM Policy:

Restrict imports mainly to essential items.
Promote export substitutes (encourage domestic production).
Promote exports (both traditional and new items).
Ensure fair distribution of goods at reasonable prices.
2. Evolution of EXIM Policies: Policies are typically announced for a specific period (e.g., 5
years).
1985-1990: Focused on facilitating production via easier access to imported inputs,
aiming for stability.
1990: Aimed to strengthen industrial and export growth impulses.
 1992-1997: Further liberalized imports, emphasizing support for domestic
manufacturing.
1997-2002: Focused on liberalization, openness, transparency, and globalization.
2002-2007: Focused on small scale sector, agriculture, and Special Economic Zones
(SEZs).
2009-2014: Focused on market/product diversity, tech upgrades, support for green
products, specific sectors (marine, tea, pharma), procedural simplification, and cost
reduction.
3. Foreign Trade Policy (FTP) 2023: This is the current policy framework.
Aim: Make India a global export hub and integrate it into global value chains.
Highlights: Focuses on process re-engineering and automation for ease of doing
business, supports emerging areas like high-end tech (SCOMET items), facilitates e-
commerce exports, encourages state/district level export promotion, includes export
incentives (like duty refunds, EPCG scheme), shifts towards a remission/entitlement-
based regime to comply with WTO guidelines.
Objectives: Promote sustainable economic growth, enhance India's global market
position, boost merchandise exports, further integrate India into global value chains,
and make India an export hub.

These policies shape the overall industrial landscape and India's engagement with the global
economy.

VII. Project Management (Part 1)

This section introduces the concepts of projects and how they are managed.

1. Concept of a Project:
A project isn't routine work. It's a complex set of non-routine activities designed to
achieve a specific goal within a set time limit and using a specific amount of
resources.
It's a temporary endeavor with a defined beginning and end. It's undertaken to create
a unique product, service, or result.
This temporary nature contrasts with regular business operations, which are repetitive
and ongoing to produce standard products or services.
2. Project Characteristics: What makes something a project?
Unique Purpose: Every project aims to achieve a specific, unique goal.
Temporary: Projects have a definite start and end date.
Progressive Elaboration: Projects develop in steps and continue incrementally.
Details become clearer as the project progresses.
Requires Resources: Projects need resources, often from different areas or
departments.
Primary Customer/Sponsor: Projects usually have a main customer or sponsor who
defines the objectives and provides resources.
 Involves Uncertainty: Since projects are unique, they inherently involve uncertainty
and risk.
3. Meaning & Definitions of Project Management:
It's the application of knowledge, skills, tools, and techniques to project activities to
meet project requirements1 effectively and efficiently.
Think of it as the structured approach to planning, guiding, and controlling project
processes from start to finish to achieve specific goals within constraints like time,
cost, and scope/quality. It's a strategic competency for organizations.
4. Project Management Knowledge Areas: These are the core areas a project manager
needs to handle (often cited from PMBOK - Project Management Body of Knowledge):
Integration, Scope, Time, Cost, Quality, Procurement, Human Resources,
Communications, Risk Management.
5. Project Management Tools and Techniques: Methods used to manage projects.
Examples include Gantt charts (visual timelines), project network diagrams (showing
task dependencies), and critical path analysis (identifying the sequence of tasks
determining the project duration).
These tools help organize tasks, track progress, centralize information, and facilitate
collaboration.
6. Scope of Project Management: The stages involved.
Initialization (starting the project)
Planning and Development
Project Execution (doing the work)
Monitoring (tracking progress)
Project Closing (finishing up)
7. Objectives of Project Management & SMART Approach:
Core objectives revolve around managing:
Scope: What the project will deliver (its boundaries).
Performance: Meeting the required quality or level.
Time: Completing within the deadline.
Cost: Staying within budget. (Often seen as the "triple constraint" + quality).
SMART Approach: A way to set effective project goals. Goals should be:
Specific: Clearly defined aim.
Measurable: Quantifiable.
Attainable: Achievable with available resources.
Realistic: Practical and relevant.
Time-limited: Has a defined timeframe.
8. Importance of Project Management: Why is it crucial today?
Squeezed Product Life Cycles: Products become obsolete faster, requiring quicker
development and launch. Speed and innovation are key.
Global Competition: Increased competition requires efficient project execution.
 Knowledge Explosion: Managing complex information and technology is vital.
Corporate Downsizing: Doing more with fewer resources necessitates better project
management.
Customer Focus: Increased demand for customized products/services requires
effective project handling.
Managing Small Projects: Even small projects benefit from structured management.
Emerging Economies: Growth in these economies creates demand requiring project
management skills.
9. Role of Project Manager: A PM wears multiple hats:
Integrator: Ensures all parts of the project work together coherently (develops,
implements, monitors the overall plan).
Communicator: Spends most time communicating – gathering, analyzing, and
distributing information to all stakeholders (team, sponsor, public etc.).
Leader: Motivates and inspires the team, providing vision and direction. Key
leadership skills include facilitating, coordinating, and motivating.

VIII. Integrated Project Management (IPM)

Integrated project management is about coordinating and synchronizing different projects

and their various elements within an organization to achieve overall strategic goals
effectively. It's sometimes also referred to as program management when dealing with
multiple related projects.

1. Vertical and Horizontal Integration:

Vertical Integration: This focuses within a single project or program, looking up and
down the hierarchy from business strategy, to program goals, to project details, to
the final product/service components. It ensures that the project aligns with the
organization's strategy and that the final output meets the requirements. It involves a
structured, often top-down approach.
Horizontal Integration: This focuses on collaboration across different departments,
disciplines, or teams working on a project. It ensures seamless coordination and
communication between different functional groups involved.
2. Portfolio Integration: This deals with selecting and managing a group (portfolio) of
projects to align with the company's overall strategy. Tools used include:
Cash Flow Analysis: Forecasting the income or value a project will generate over time
(e.g., 5+ years).
Net Present Value (NPV): Calculating the present value of future cash flows for
projects to compare their overall financial viability. NPV represents the total value an
investment adds today.
Risk Assessment & Management: Identifying high-level risks for each project and
preparing plans to manage them (e.g., using a risk matrix).
Weighted Scoring Model: Scoring each potential project against strategic objectives,
weighting those objectives based on importance, and calculating a weighted score to
 help rank and select projects.
3. Integration Model Components: IPM brings together various aspects:
People: Training people to coordinate and interact effectively across project teams.
Projects: Defining project work in terms of coordination and integration across
functions.
Technology: Managing complex products by focusing on how different parts
interface and integrate.
Combined Metrics: Using tools like earned value management to see the combined
impact of progress on financial, schedule, risk, and quality aspects.
4. Project Integration Management (PMBOK Process Area): This is a key knowledge area in
standard project management (like PMBOK). It includes processes like:
Developing the Project Charter: Formally authorizing the project.
Developing the Project Management Plan: Creating the overall plan.
Directing & Managing Project Work: Executing the plan.
Monitoring & Controlling Project Work: Tracking progress and making adjustments.
Performing Integrated Change Control: Managing changes to the plan.
Closing Project or Phase: Finalizing all activities.
5. Developing a Project Charter: This is the document that formally authorizes a project. It
typically includes:
Project purpose/justification.
Measurable objectives and success criteria.
High-level requirements, description, and risks.
Summary milestone schedule and budget.
Approval requirements.
Assigned project manager and their authority level.
Name and authority of the sponsor authorizing the charter.
6. Benefits of IPM:
Transfers knowledge from projects to the organization.
Improves planning through better understanding of processes.
Lowers cost of planning via reuse of knowledge/processes.
Improves coordination among people.
Enhances commitment through better communication and sharing.
Institutionalizes key practices like knowledge reuse, dependency tracking, and post-
mortem analysis.
7. IPM Cycles (Project Life Cycle Phases): A typical project lifecycle involves these phases:
Conceptual: Setting objectives, goals, and specifications; understanding deliverables.
Definition: Detailing the project scope (e.g., using a Work Breakdown Structure),
budget, schedule, and critical path.
Production: Actually creating or prototyping the project deliverables for testing.
 Operations: Installing, testing, and measuring the deliverable in use with the
customer.
Divestment: Documenting the project, closing it down, and reassigning team
members.
8. Projects and Organizational Strategy: IPM ensures projects align with and support the
overall strategy of the organization. Project Portfolio Management helps select and
prioritize projects based on this strategic alignment.

IX. Feasibilities of Projects

Before starting a project, it's crucial to determine if it's actually viable or doable. That's what
a feasibility study is for.

1. Introduction to Feasibility Study:

It's an analysis to check the viability (practicality and potential for success) of a project
idea.
It ensures a project is legally sound, technically possible, and economically justifiable
before committing resources. Not every project idea is workable or makes good use
of company resources.
2. Types of Feasibility Study: A thorough study usually looks at these five areas:
Technical Feasibility: Assesses if the organization has the necessary technical
resources and expertise to complete the project. It involves evaluating hardware,
software, and other technical requirements. For example, can a pilot-scale success be
expanded to large-scale production?.
Economic (Financial) Feasibility: Determines if the project makes financial sense. This
involves a cost/benefit analysis to assess viability, costs, and expected benefits before
allocating funds. It helps determine the positive economic impact the project will
have.
Legal Feasibility: Checks if any part of the project conflicts with legal requirements
like zoning laws, data protection acts, etc.. For instance, finding out if the desired
location for a new building is zoned correctly can save time and effort.
Operational Feasibility: Assesses if and how well the organization's needs can be met
by completing the project. It examines if the project plan satisfies the requirements
identified earlier. Will the organization be able to run the project once it's completed?
Scheduling Feasibility: Determines if the project can be completed within the desired
timeframe. This is critical, as delays can lead to project failure. It involves estimating
how much time the project will take.
3. Components of Techno-Economic Feasibility: This combines technical and economic
aspects, often including:
Project background, market study (demand, forecasting, exports, sensitivity analysis,
sales forecast), production program, plant capacity, materials/inputs, location analysis,
technology/equipment selection, civil engineering aspects, organizational structure,
implementation schedule, financial evaluation, and economic evaluation.
 4. Feasibility Assessment Checklist: Key questions to ask across different feasibility areas
(Technical, Operational, Financial, Market, Legal, Schedule, Environmental/Social, Risk,
Resource ). (The document lists specific questions for each area).
5. Benefits of Conducting a Feasibility Study:
Improves team focus.
Identifies new opportunities.
Provides information for a "go/no-go" decision.
Narrows down business alternatives.
Validates the reason for undertaking the project.
Enhances success rate by evaluating multiple factors.
Aids decision-making.
Identifies reasons not to proceed.
6. Possible Constraints: Feasibility studies help identify constraints, which can be:
Internal Project Constraints: Technical limits, budget, resource availability.
Internal Corporate Constraints: Overall financial health, marketing capabilities.
External Constraints: Logistics, environmental factors, laws, regulations.
7. Detailed Project Report (DPR):
If a project is deemed feasible, a DPR is often created. It's a comprehensive blueprint
for the project.
Purpose: Serves as a roadmap for implementation, guiding decision-makers.
Key Uses: Securing approvals/financing, assessing feasibility in detail, identifying risks,
optimizing resource allocation, managing budgets, ensuring project stays within
constraints.
Content: Includes objectives, scope, timelines, financials, resources, risks, technical
specs, organization structure, methodology, marketing strategy (if applicable), and
the feasibility analysis itself.
8. Feasibility cum DPR: The DPR often incorporates and expands upon the findings of the
feasibility study, serving as a basis for decision-making, planning, risk mitigation,
resource allocation, and communication.

X. Work Breakdown Structure (WBS)

After identifying project requirements and defining the scope, the WBS is a fundamental tool
used to break down the project work into smaller, more manageable pieces.

1. Introduction:
Breaking down large activities into understandable units is essential in project
management.
The WBS is used for virtually all projects. Once the scope and deliverables (the
outputs of the project) are clear, the work is subdivided into smaller elements.
Think of the WBS as the map of the project. It helps ensure all work is identified,
integrates the project with the organization, and establishes a basis for control.
2. Definition:
The PMBOK defines WBS as a "deliverable-oriented grouping of project activities that
organizes and defines the total scope of the project". A deliverable is a measurable,
tangible outcome needed to complete the project or a part of it.
More simply, it's the set of all tasks in a project, often arranged hierarchically like an
organization chart or tree.
3. How WBS Helps the Project Manager:
Facilitates evaluation of cost, time, and performance.
Helps assign specific jobs to individuals.
Makes it possible to plan, schedule, and budget effectively.
4. Factors Considered in Developing a WBS:
Each activity should produce a single, tangible deliverable.
Activities at any level are the sum of the sub-activities directly below them.
Each activity should be unique.
Decomposition should be logical from higher to lower levels.
The process should be flexible to accommodate scope changes.
It should specify important reporting points and align with organizational/accounting
structures.
5. Uses of WBS:
Thought Process Tool: Helps structure thinking about the project.
Architecture Tool: Provides a complete picture of the project.
Planning Tool: Helps identify resources needed.
Project Status Reporting Tool: Forms a basis for tracking progress.
6. Developing a WBS (Approaches):
Top-Down Approach: Starts with the final project goal/deliverable and breaks it down
into smaller and smaller components until the work is sufficiently defined. The project
manager often leads this process, distributing tasks downwards.
Bottom-Up Approach: Starts by brainstorming all the individual tasks needed and
then grouping them into larger components and deliverables. This is often more
collaborative, involving team members from different areas to identify detailed tasks.
It provides a detailed look at low-level tasks.
7. Criteria for Completeness (at the lowest level of detail): Each work element should be:
Measurable
Bounded (clear start/end)
Deliverable (produces an output)
Simple enough to estimate cost/time
Within acceptable duration limits
Independent (as much as possible) from other activities.