Preparation work is social, technical and financial in nature. Typical preparation activities include: the identification of funding sources, needs assessments, community and stakeholder consultations, socio-economic studies, the development of project concepts, assessments of site suitability (e.g. topography, geotechnical and environmental conditions, bulk services), land availability negotiations and agreements, participative planning, preliminary design, estimates for capital and operational costs and applications to funders or implementation partners. Most of this work takes place during the pre-feasibility and feasibility phases. Please also refer to the project preparation cycle diagram which illustrates more fully PPT’s systematic approach to project preparation.

Systematic and effective Project Preparation is important for a range of reasons outlined below:

• Project risks are managed and controlled.
• Scarce implementation resources (e.g. capital funding) are optimally utilized and are only allocated to viable projects.
• Projects are well conceptualized and planned.
• Development is appropriately tailored to local needs and is integrated in nature.
• Projects are supported by the key stakeholders (including the community, municipality, funders and implementation partners).
• Government and other funders can predict and therefore manage their cash flows by enhancing the predictability of project outcomes and timeframes for implementation.

Project Preparation needs to be properly managed and co-ordinated and should be regarded as a project management function. Often government departments, municipalities or other funding agencies do not have the in-house personnel to undertake all the activities required for project preparation and typically the assistance of outside specialists is required. It is therefore usually necessary that preparation funds are available, a budget compiled and maintained, specialists identified and adequately briefed, and quality control performed. It is also necessary that this process be effectively managed. Playing this management role, or training people to perform it, is one of PPT’s core functions.