Types of project life cycles

Projects develop through a cycle known as the project life cycle. Here, you will explore different types of project life cycle models.

There are three life cycle models to understand:

• the corporate investment life cycle

• the plant life cycle

• the project life cycle.

The illustration below shows how each of these phases are structured.

The corporate investment life cycle

The corporate investment life cycle includes all the activities you need to carry out in relation to a project. It develops through phases from the beginning, to the realisation of the project itself and then to phases outlining activities you may perform after the project is concluded.

Imagine that you manage a utility company and you are thinking about building a power plant. First, you will need to plan a strategy for how much power you want to generate and the type of power plant you intend to construct (eg coal, gas or photovoltaic).

Next, you will carry out a feasibility study to identify the different types of power plant you could build. If your utility company is planning to build a photovoltaic plant you need to deal with potential suppliers to decide which size and type of plant you wish to build. You will then need to make the contract(s). Usually, you allocate the project to an Engineering, Procurement and Construction (or Contracting) company, or EPC for short.

Next, the plant is realised. It then enters into an exercise or operational phase, and finally it enters close out or decommissioning.

The plant life cycle

The plant life cycle takes place during the realisation, exercise and close out phases of the corporate investment life cycle.

This has three phases beginning with the project phase and ending with decommissioning.

In the second phase, there is a time where the owner exercises or operates the plant before dismantling the plant. The plant’s operation usually generates money, to pay for construction costs, to provide a return of the investment, and to create a fund to pay for the plant’s decommissioning.

The project life cycle

The project phase is the most interesting of all the phases, as this is when the project starts to produce its output.

The project phase has four stages:

1. The concept phase is where the project team review and evaluate various possible concepts.

2. The design phase begins with designing the generic concept and then moves into exploring the details. In the example of a power plant, you will need to produce a detailed design for construction at this stage.

3. The implementation phase is where you build the plant.

4. The last phase is the commissioning phase. Commissioning is the word typically used in major projects. Sometimes this last phase is called a handover as it is typically where the contractor hands over the infrastructure to the customer. In projects more generally, this phase is called closing.

You will see that the four phases in the project life cycle are often described using different terms. For instance, the Project Management Institute (2013) uses the terms initiating, planning, executing and closing. You might want to familiarise yourself with the different terminology used, but the four phase approach shown here is very typical.

In major projects, there is sometimes overlap between the four phases especially between the design and implementation phases, but in general we can identify these different phases.

Please refer to the glossary to check any terminology you are unfamiliar with: Glossary of Project Management Terms

Coming up....

In the next section, you will review the infrastructure life cycle.