SWOT Analysis (Environment Impact Assessment, Social Cost Benefit Analysis)

SWOT analysis is a technique that businesses often use to assess four key aspects of their organization. This analysis can help companies better understand how likely they are to succeed and what areas they should focus on to improve.

• Strengths:

These are internal factors (factors you can control) that set your project or business up for success. Project strengths include any aspects of the project that make it likely to succeed. Some examples are detailed project requirements, an engaged customer, robust project management software, and experienced team members.

• Weaknesses:

Weaknesses are internal factors that may make it difficult for you to succeed. For instance, if your team has never worked together before and several members are new and inexperienced. Other internal weaknesses could be overallocated resources, a lack of visibility into progress, disengaged stakeholders, or a lack of project funding.

• Opportunities:

Opportunities are factors that are outside of your control (external factors) that could help your project succeed. They could be current opportunities that exist now but have not yet been taken advantage of or future opportunities that you think may happen. If your primary material vendor suddenly offered a discount, it would be an opportunity to save your project money. If another project at your company finished early, it could free up resources you can then use to help your project succeed.

• Threats:

These are external factors that could harm your project if they were to take place. As with opportunities, they can be current or future threats. The possibility of one of your vendors going out of business would be a threat. Other threats could be bad weather (such as a snowstorm causing employees to miss work), increased costs of supplies, materials, or contractors.

Steps:

• Include all your key stakeholders in the process. Team members, your client, sponsor, and others close to the project should all help identify and analyze critical factors so that nothing is overlooked.
• Gather everyone together (virtually or in-person) and brainstorm a list for each of the four categories (strengths, weaknesses, opportunities, and threats.)
• Prioritize the factors in each section from most important to least important once the brainstorming is complete.
• Create and distribute the SWOT analysis. List the factors in each category with the most important at the top and the least important at the bottom.
• Create action plans to address any factors within your control (strengths and weaknesses) as well as any current opportunities or threats.
• Create future plans for how to handle opportunities and threats that may arise later. These plans should include a means of identifying that the opportunity or threat has happened, as well as the action plan for taking advantage of them.
• Maintain the list in a central location where all stakeholders can easily reference it, and refer to it regularly, so that priorities stay top of mind.
• Review and reassess the list periodically throughout the project to see if anything has changed and if any new factors need to be added.

Environment Impact Assessment

Environmental Impact Assessment (EIA) is a process of evaluating the likely environmental impacts of a proposed project or development, taking into account inter-related socio-economic, cultural and human-health impacts, both beneficial and adverse.

UNEP defines Environmental Impact Assessment (EIA) as a tool used to identify the environmental, social and economic impacts of a project prior to decision-making. It aims to predict environmental impacts at an early stage in project planning and design, find ways and means to reduce adverse impacts, shape projects to suit the local environment and present the predictions and options to decision-makers. By using EIA both environmental and economic benefits can be achieved, such as reduced cost and time of project implementation and design, avoided treatment/clean-up costs and impacts of laws and regulations.

Although legislation and practice vary around the world, the fundamental components of an EIA would necessarily involve the following stages:

• Screening to determine which projects or developments require a full or partial impact assessment study;
• Scoping to identify which potential impacts are relevant to assess (based on legislative requirements, international conventions, expert knowledge and public involvement), to identify alternative solutions that avoid, mitigate or compensate adverse impacts on biodiversity (including the option of not proceeding with the development, finding alternative designs or sites which avoid the impacts, incorporating safeguards in the design of the project, or providing compensation for adverse impacts), and finally to derive terms of reference for the impact assessment;
• Assessment and evaluation of impacts and development of alternatives, to predict and identify the likely environmental impacts of a proposed project or development, including the detailed elaboration of alternatives;
• Reporting the Environmental Impact Statement (EIS) or EIA report, including an environmental management plan (EMP), and a non-technical summary for the general audience.
• Review of the Environmental Impact Statement (EIS), based on the terms of reference (scoping) and public (including authority) participation.
• Decision-making on whether to approve the project or not, and under what conditions; and
• Monitoring, compliance, enforcement and environmental auditing. Monitor whether the predicted impacts and proposed mitigation measures occur as defined in the EMP. Verify the compliance of proponent with the EMP, to ensure that unpredicted impacts or failed mitigation measures are identified and addressed in a timely fashion.

Social Cost Benefit Analysis

The primary goal of all businesses is to get maximum return on investments. Thus, the promoters prefer to assess commercial viability. However, some ventures may not give appealing results for business profitability, so such programs are executed because they have social consequences. These are infrastructure works, including roadway, rail, bridges, and certain other construction works, irrigation, electricity initiatives, etc., that have a major role in socio-economic concerns instead of merely commercial prosperity. Therefore, such initiatives are assessed for the net socio-economic advantages and cost control that is nothing other than the national survey of potential socio-economic costs.

So, SCBA, often known as Social Cost-Benefit Analysis in project management, has become a tool for effective financial evaluation. It is an approach to assessing infrastructure investments from a social (or economic) perspective. Get to know more from PMP training, which is the most prominent credential in project planning worldwide.

1. Market Instability

A private corporation would evaluate a deal based on productivity and relevant market prices. However, the government must consider additional variables. Determining social costs in the event of market inefficiency and when market pricing cannot specify them. These hidden social costs are referred to as shadow prices.

2. Investments & Savings

A venture that results in increased savings is considered an investment in a market.

3. Income is distributed and redistributed

The initiative should not lead to revenue accumulation in the control of a few and the distribution of income.

4. Career and Living Standards

The impact of a program on employment and level of livelihood will also be considered. Therefore, the contract should result in a rise in employment and living standards.

5. Externalities

Externalities can be detrimental and advantageous to an enterprise. As a result, both impacts must be considered before approving a deal. For example, positive externalities can take the shape of technological advances, while negative externalities might take the form of rapid urbanization and ecological degradation.

6. Subsidy and Taxation

Taxation and subsidies are treated as expenses and revenue, respectively. However, taxation and subsidy are regarded as transfer payments for social cost-benefit analysis.

Different Approaches of SCBA in Project Management

By the late 1960s and early 1970s, two distinct approaches to SCBA had developed. These are as follows: 1. UNIDO’s Approach 2. L-M Approach. If you’re seeking an online program for the PMP certification exam that includes thousands of PMP practice questions, the PMP Course Online package is a good alternative.

1. UNIDO’s Approach

The UNIDO (United Nations Industrial Development Organization) planning methodology is as follows: The UNIDO method was reflected in the project assessment principles, establishing a systematic assessment for SCBA in developing economies. However, due to the severity and complexity of this task, concise and functional guidance for project evaluation in execution was required. Therefore, the fundamental principle of the method is the introduction in 1978 of the UNIDO Guidance to Practical Project Assessment.

The appraisal process is carried out on both planned and completed projects. It is a systematic method for determining the feasibility of a project or idea. It helps determine the feasibility before allocating funds to it. It frequently entails an evaluation of various scenarios, which is accomplished by applying any decision procedure or financial evaluation criteria.

The UNIDO project evaluation technique consists of five phases:

• Assessment of the proposal’s market performance at market values.
• Determining the net benefit from a financial perspective.
• Adaptation to account for the development’s implications on savings and investment.
• Adaptation to account for the program’s impacts on wealth distribution.
• Modifying the program’s results on merit products with a social worth is not equivalent to their economic importance.

2. L-M (Little-Mirrlees) Approach

I.M.D. Little and J.A. Mirlees pioneered this technique in social cost-benefit analysis. The essential principle of this method is that in developing countries, the social cost of using a product varies significantly from the amount charged for it. As a result, Shadow Prices are required to signify the actual worth of a resource to the community. The LM Strategy covers all aspects of SCBA in developing nations.

L-M Numeraire is a source of uncommitted public revenue at the moment. A project’s resources inputs and outputs are categorized primarily as labor traded goods and non-traded interests. As a result, to determine the actual value of such sources, we must choose:

Shadow Wage Rate (SWR)

The SWR is used to calculate the potential cost of adding a person to the assignment. This requires us to ascertain:

• The value of production is lost as a result of the usage of a unit of labor.
• The expense of extra consumption owing to labor transfer