PMP Exam Prep Study Guide V2 0

Handbook PMP Exam Prep Workshop

PMP

PMP Exam Preparation Workshop PMP Exam Prep Study Guide

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PMP EXAM PREP WORKSHOP

Hand Book

Based on PMBOK Guide 5th Edition

© 2012 Brain4ce Education Solutions Pvt. Ltd.


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Table of Content

Chapter 1: PMP® Examination - At a Glance .................................................................................... 6

1. PMP® Examination - At a Glance ................................................................................................... 7

1.1. About PMI and PMP ............................................................................. 7

1.2. PMP Exam Preparation Program Objective ................................................ 7

1.3. PMP Exam Prerequisites ....................................................................... 7

1.4. PMP Exam Fee ................................................................................... 8

1.5. Continuing Certification Requirements .................................................... 9

1.6. PMP Examination Format and Passing Score ............................................. 10

1.7. Topics of PMP Examination .................................................................. 10

Chapter 2: Project Management Foundation – Framework, Lifecycle & Organization ....... 13

2. Project Management Foundation – Framework, Lifecycle & Organization ...................... 14

2.1. What is a Project? ............................................................................. 14

2.2. Projects vs. Operations ....................................................................... 15

2.3. What is Project Management? ............................................................... 16

2.4. Project Constraints ............................................................................ 16

2.5. Project Stakeholders .......................................................................... 17

2.6. Competencies of Project Manager .......................................................... 17

2.7. Project Management Context: Related Endeavors ...................................... 18

2.8. Purpose of Project Management ............................................................ 20

2.9. Factors that have impact on Projects ..................................................... 21

Chapter 3: Processes, Process Groups and Knowledge Areas ........................................ 29

3. Processes, Process Groups and Knowledge Areas .................................................................. 30

3.1. Process ........................................................................................... 30

3.2. Project Management Process Group ....................................................... 30


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3.3. Knowledge Areas: .............................................................................. 31

3.4. Process Mapping to Knowledge Areas and Process Groups ............................ 32

Chapter 4: Project Integration Management .................................................................................. 35

4. Project Integration Management ................................................................................................ 36

4.1. Develop Project Charter: .................................................................... 36

4.2. Develop Project Management Plan: ........................................................ 41

4.3. Direct & Manage Project Work: ............................................................. 44

4.4. Monitor and Control Project Work: ........................................................ 50

4.5. Perform Integrated Change Control ........................................................ 55

4.6. Close Project or Phase ........................................................................ 58

Chapter 5: Project Scope Management ............................................................................................ 61

5. Project Scope Management .......................................................................................................... 62

5.1. Plan Scope Management ...................................................................... 62

5.2. Collect Requirements ......................................................................... 65

5.3. Define Scope .................................................................................... 69

5.4. Create WBS ..................................................................................... 71

5.5. Validate Scope.................................................................................. 74

5.6. Control Scope ................................................................................... 76

Chapter 6: Project Time Management ............................................................................................. 80

6. Project Time Management ............................................................................................................ 81

6.1. Plan Schedule Management .................................................................. 81

6.2. Define Activities ............................................................................... 84

6.3. Sequence Activities ........................................................................... 86

6.4. Estimate Activity Resources ................................................................. 91

6.5. Estimate Activity Durations .................................................................. 94

6.6. Develop Schedule .............................................................................. 99

6.7. Control Schedule ............................................................................. 105


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Chapter 7: Project Cost Management ............................................................................................. 111

7. Project Cost Management ........................................................................................................... 112

7.1. Plan Cost Management ...................................................................... 112

7.2. Estimate Cost ................................................................................ 114

7.3. Determine Budget ........................................................................... 119

7.4. Control Costs ................................................................................. 122

Chapter 8: Project Quality Management ....................................................................................... 127

8. Project Quality Management...................................................................................................... 128

8.1. Plan Quality Management .................................................................. 128

8.2. Perform Quality Assurance ................................................................ 132

8.3. Control Quality ............................................................................... 135

Chapter 9: Project Human Resource Management ...................................................................... 140

9. Project Human Resource Management .................................................................................... 141

9.1. Plan Human Resource Management ...................................................... 141

9.2. Acquire Project Team ...................................................................... 145

9.3. Develop Project Team ...................................................................... 147

9.4. Manage Project Team ....................................................................... 151

Chapter 10: Project Communications Management .................................................................... 155

10. Project Communications Management .................................................................................... 156

10.1. Plan Communications Management ...................................................... 156

10.2. Manage Communications ................................................................... 159

10.3. Control Communications ................................................................... 162

Chapter 11: Project Risk Management ........................................................................................... 166

11. Project Risk Management ........................................................................................................... 167

11.1. Plan Risk Management ...................................................................... 167

11.2. Identify Risk .................................................................................. 170

11.3. Perform Qualitative Risk Analysis ........................................................ 175


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11.4. Perform Quantitative Risk Analysis ...................................................... 177

11.5. Plan Risk Responses ......................................................................... 180

11.6. Control Risks .................................................................................. 183

Chapter 12: Project Procurement Management ........................................................................... 187

12. Project Procurement Management ........................................................................................... 188

12.1. Plan Procurement Management ........................................................... 188

12.2. Conduct Procurements ..................................................................... 194

12.3. Control Procurements ...................................................................... 198

12.4. Close Procurements ......................................................................... 201

Close Procurements addresses each agreement applicable to the project or a project

phase. It supports the Close Project or phase process as it involves verification that all

work and deliverables were acceptable. It also involves administrative activities, such

as updating records to reflect final results and archiving such information for future

use. 202

Chapter 13: Project Stakeholders Management .......................................................................... 204

13. Project Stakeholders Management ........................................................................................... 205

13.1. Identify Stakeholders ....................................................................... 205

13.2. Plan Stakeholder Management ............................................................ 207

13.3. Manage Stakeholder Engagement ......................................................... 210

13.4. Control Stakeholder Engagement ......................................................... 213


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Chapter 1: PMP® Examination - At a

Glance


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1. PMP® Examination - At a Glance

This Chapter discusses about as to how a participant of PMP Exam Prep Program would

approach the PMP examination and what are the key information would they need to know.

1.1. About PMI and PMP

Project Management Institute is the world's leading not-for-profit professional

membership association for the project, program and portfolio management

profession. Founded in 1969, PMI delivers value for more than 2.9 million professionals

working in nearly every country in the world through global advocacy, collaboration,

education and research. PMI advances careers, improves organizational success and

further matures the profession of project management through its globally recognized

standards, certifications, resources, tools academic research, publications,

professional development courses, and networking opportunities.

1.2. PMP Exam Preparation Program Objective

Get introduced to the principals of Project Management as per PMI’s Project

Management Body of Knowledge (PMBOK Guide 5th Edition)

Understand the best practices of Project Management as per PMBOK Guide 5th Edition

Understand how to apply this knowledge to day-to-day project management activities

Get introduced to the process of earning PMP certification

Get familiar with the multiple choice questions in line with the PMP Certification

process

Gain the confidence to face the PMP examination challenge

1.3. PMP Exam Prerequisites

Candidates can apply for the examination under any of the below mentioned categories

based on their educational qualification:


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Categories Educational Background Project Management

Experience

Project Management

Education

Category 1 Bachelor‘s Degree or

Global Equivalent

36+ Months

4,500+ Hours 35 Contact Hours

Category 2

High School Diploma

Associate‘s Degree or

Global Equivalent

60+ Months

7,500+ Hours 35 Contact Hours

Project management experience mentioned in both the categories must be from unique

and non-overlapping projects.

Within the specified 4,500/7,500 hours, experience In all 5 performance domain is

required (experience need not be in all 5 performance domains on a single project)

Candidates can satisfy Project Management Education requirement by successfully

completing the training sessions through PMIs Global Registered Education Provider. One

Contact hour of Training Is equivalent 1 Contact Hour.

1.4. PMP Exam Fee

Below table describes the fee structure for various categories:

Exam Category Fee for Members Fee for Non Members

Computer-based Testing USD 405.00 USD 555.00

Paper-based Testing USD 250.00 USD 400.00

Re-examination Computer-

based USD 275.00 USD 375.00

Re-examination Paper-based USD 150.00 USD 300.00


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We recommend candidates to become a member of PMI first, and then apply for PMP

Certification because as a PMI member receive Exclusive Members Discount on PMP exam

fee.

All candidates will be given one year to take the examination. This one-year eligibility

period begins when a candidate’s application is approved.

Candidates will have three opportunities to take and pass the PMP examination within

their one year eligibility period. If candidates do not succeed in 3 attempt, candidates will

have to wait one year from their unsuccessful attempt before being permitted to take the

exam again.

Please log on to Membership section at www.pmi.org and get a complete list of valuable

benefits that help to promote your professional and career development.

1.5. Continuing Certification Requirements

Those who have been granted the PMP credential must demonstrate ongoing professional

commitment to the field of project management by satisfying PMIs Continuing

Certification Requirements Program (CCR). The purpose of the Continuing Certification

Requirements Program is to:

1) Sustain the PMP as a global credential.

2) Enhance the ongoing professional development of PMPs

3) Encourage and recognize individualized learning opportunities

4) Offer a standardized and objective mechanism for attaining and recording

professional development activities

The CCR program supports the ongoing professional development of PMI certified PMPs

and the maintenance of PMP Certification.

PMPs must attain minimum of sixty (60) Professional Development Units (PDUs) during each

CCR cycle of 3 years.

Up to 18 excess PDUs earned during the final year of the current CCR cycle can be

transferred to next CCR cycle.

PMPs who fail to satisfy the continuing certification requirements prior to the completion

of their cycle have 12 months from the cycle expiration to do SO. During this time their

PMP certification will remain suspended.

http://www.pmi.org/


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On completion of suspension period of 12 months, PMI will revoke the certification of a

PMP not satisfying the CCR program requirements.

To renew the PMP certification, candidates will be charged renewal fee once during the

CCR cycle. Payment will be required with submission of the application for Certificate

renewal after PMP has earned the required PDUs. Amount of renewal fee:

1) US $120 for PMI members

2) US $150 for non-members

1.6. PMP Examination Format and Passing Score

The PMP Certification examination consist of 200 multiple choice questions. The 4 hours

examination administration is preceded by a briefing and 15 minute computer tutorial.

25 Pretest questions (also known as dummy questions) will be randomly placed throughout

the examination to gather statistical information on the performance of these questions

in order to determine whether they may be used on future examinations. These 25 pretest

questions are included in the 200-question but will not be included in the pass/fail

determination. Candidates will be scored on 175 questions.

To pass the PMP examination, candidates must correctly answer a minimum of 106 of the

175 scored questions.

Examination is followed by an optional candidate satisfaction survey. At completion, exam

result is shown on the screen and score report is handed over to candidate at the

examination center. For a detailed blueprint of the examination, please review PMP

Handbook provided in the certification area of the PMI Web site.

Upon completion of the test, the examination contractor will immediately provide

candidates with a printed copy of results indicating pass or fail status.

1.7. Topics of PMP Examination

Revised PMP certification examination will cover knowledge in five process groups/domain

with respective percentage of questions:


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Domain Distribution of

Questions

Initiation 13%

Planning 24%

Execution 30%

Monitoring and

Controlling 25%

Closing 8%

1.7.1. Initiation (13%)

1) Conduct project selection methods

2) Define preliminary project scope

3) Identify initial project risks, assumptions, and constraints

4) Identify key stakeholder

5) Develop project charter

6) Get project charter approval

1.7.2. Planning (24%)

1) Document detail project scope, constraints and assumptions

2) Identify project team and define roles and responsibilities

3) Create the WBS

4) Estimate project effort, cost

5) Develop project schedule

6) Develop change management plan

7) Identify risks and define risk strategies

8) Obtain plan approval

9) Baseline project plan

1.7.3. Execution (30%)

1) Perform tasks defined in project plan

2) Perform activities to build effective project team


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3) Implement the procurement of project resources

4) Manage resource allocation

5) Perform quality assurance

6) Implement approved changes

7) Implement approved actions and workarounds

8) Improve team performance

9) Distribute information to stakeholders

1.7.4. Monitoring and Controlling (25%)

1) Measure project performance

2) Analyze root causes for performance variance

3) Suggest corrective and preventive action

4) Verify and manage changes to the project

5) Ensure project deliverables conform to quality standards

6) Monitor all risks

1.7.5. Closing (8%)

1) Get final acceptance for the project

2) Obtain financial, legal, and administrative closure

3) Identify, document and communicate lessons learned

4) Create and distribute final project status report

5) Archive arid retain project records

6) Measure customer satisfaction

7) Release project resources


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Chapter 2: Project Management

Foundation – Framework, Lifecycle

& Organization


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2. Project Management Foundation – Framework, Lifecycle &

Organization

This chapter lays the foundation upon which entire set of knowledge areas are built. In this

chapter you are going to learn about the Project, Project Management Framework, what

are the factors that can have an impact on a project and also how the role and powers of

project manager changes in different organizational structures?

Topics covered in this chapter are highly important with respect to PMP examination as

questions coming from these areas will gauge your understanding of project organization,

relationship between various endeavors of an organization (project, program &

portfolio)and key project roles (stakeholders, sponsor and project manager).

2.1. What is a Project?

Project is defined as:

“A temporary endeavor undertaken to create a unique product, service or result.”

A project can thus be defined in terms of its specific characteristics. Temporary means that

every project has a definite beginning and a definite end. Unique means that the product

or service is different in some distinguishing way from all other products or services. For

many organizations, projects are a means to respond to those requests that cannot be

addressed within the organizations normal operational limits. Product or service

characteristics are progressively elaborated.

How Temporary?

It has a definite beginning and end, it is not an ongoing effort.

it comes to an end when objectives have been met

Project Team members are released on completion of the Project

How Unique?

End result or product or service is different in some way from the other product, service

or result. For example: Within a Housing complex, each type of flat has different designs,

facilities and features to differentiate their end characteristics -mosaic with teak wood

finish or marble with teak wood finish or red-oxide flooring with forest wood finish.


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Progressive Elaboration

Progressive elaboration is a characteristic of projects that combines the concepts of

temporary and unique. Because the product of each project is unique, the characteristics

that distinguish the product or service must be progressively elaborated. Progressively

means “proceeding in steps; continuing steadily by increments.”

Project become existent for solving an existing problem or a need came from market or

social need or technological change or business need or cultural change or organizational

need or environmental change, or a customer request or a Legal requirement, etc. All the

companies, institutions or establishments perform certain work which generally involve

either projects or operations. Both Projects and Operations own the following

commonalities:

Performed by People

Constrained by scarce resources

Planned, executed and controlled

2.2. Projects vs. Operations

Projects and Operations vary primarily as projects are temporary and unique while

operations are repetitive and ongoing. The characteristics of the Projects and Operations

are given below:

Project Operations

Create Own charter, organization and

goals

Semi-permanent charter, organization

and goals

Catalyst for change Maintains status quo

Unique product or service Standard Product or service

Heterogeneous teams Homogeneous teams

Start and End Date are defined On-going and repetitive


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2.3. What is Project Management?

Project Management - PMBOK® Definition:

“Project management is the application of knowledge, skills, tools, and techniques to

project activities to meet the project requirements.”

Project management is accomplished through the use of PM processes such as: initiating,

planning, executing, controlling, and closing (IPECC). The project team manages the work

of the projects, which typically involves:

Competing demands for scope, time, cost, risk, and quality

Stakeholders with differing needs, wants, risk tolerances and expectations

Identified requirements

It is important to note that many of the processes within project management are iterative

in nature. This is in part due to the existence of arid the necessity for progressive

elaboration in a project throughout the project life cycle; i.e., the more you know about

your project, the better you are able to manage it. The term project management is

sometimes used to describe an organizational approach to the management of ongoing

operations. This approach, more properly catted management by projects, treats many

aspects of ongoing operations as projects to apply project management techniques to them.

2.4. Project Constraints

The key challenge in the project management is to successfully manage the project while

striking the right balance among the various project elements. These elements are also

known as “Constraints”. Some of the key constraints are Scope, Time, Cost, Quality, Risk

and Resources etc. These constraints work in tandem with each other.

When one of the constraints is changed, it will

have a direct or indirect impact on other

constraints. For example if the customer is

asking to make some additions in the previously

agreed product features, it is likely to have an

impact on project cost and schedule. A change

in Scope, Time or Cost can increase the risk

associated with the project.


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2.5. Project Stakeholders

Project stakeholders are individuals and organizations that are actively involved in the

project, or whose interests may be positively or negatively affected as a result of project

execution or project completion, they may also exert influence over the project and its

results.

The project management team must identify the stakeholders, determine their

requirements, and then manage and influence those requirements to ensure a successful

project. Stakeholder identification is often happens to be difficult.

For example: Escalation in cost of input materials may threaten Construction worker’s

future and continuous employment. Some of the key stakeholders common in almost every

projects are identified below:

Sponsor

Project manager

Project team members

Customer

Sellers/Contractors

Government agencies

The naming or grouping of stakeholders primarily helps identifying which individuals and

organizations consider themselves as stakeholders. Stakeholder roles and responsibilities

may overlap, for example a customer playing a role of a sponsor and customer.

2.6. Competencies of Project Manager

Project manager is responsible for overall success of the project within the constraints of

scope, time, cost, quality, risk, resources and other key constraints. Project stakeholders

have a significant impact on these constraints hence it becomes crucial for project manager

to manage the stakeholders effectively for successful delivery. In past few years, industry

has witnessed unprecedented dynamics as organization respond to increasing completion

within complex project environment.

With such a changing working climate project managers find themselves confronted by

issues that have traditionally not been a part of their responsibilities. To deal with those

issues, they must acquire certain specific skills which will result in effective management

of the projects.


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2.6.1. Interpersonal skills

People Management, relationship creation and retention are of today’s order of the day

with internal customer, external customers, external agencies, governmental agencies,

society, and stakeholders. interpersonal skills are of paramount important in order to

be successful In today’s competitive, mechanical, fast-phased, demanding environment,

coupled with a diverse workforce, call for significant amounts of people management

skills, e.g.:

Listening and conversational skills

Leading team members

Relationship building and maintenance

Influencing individuals and organizations without formal authority

Understanding and integrating the efforts of a diverse workforce

2.7. Project Management Context: Related Endeavors

Certain types of endeavors are closely related to projects. There is often a hierarchy of

strategic plan, program, project, and subproject, in which a program consisting of several

associated projects will contribute to the achievement of a strategic plan.

2.7.1. Program

A program is a group of projects managed in a coordinated way to obtain benefits not

available from managing them individually. Many programs also include elements of

ongoing operations. For Example:

The “Integrated Guided Missile Project” includes a group of projects to design and

develop the missiles, as well as the ongoing manufacturing and support of that

missiles in operation.

Many Software and related firms have program managers who are responsible for

both individual product releases (projects) and the coordination of multiple

releases over time (an ongoing operation)

Programs may also involve a sense of repetitive or cyclical undertakings: for

example:

Testing or Quality audit are classical cases, where the product or components or

piece of software code should meet the predetermined standards or test/quality

criteria.


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Many voluntary organizations have a “resource mobilization programs,” an ongoing

effort to obtain requisite support that often involves a series of discrete projects,

such as a membership drive or an auction or sponsorship or conferences or

programs.

2.7.2. Portfolio Management

Portfolio management refers to the selection and support or projects or program

investments. These investments in projects and programs are guided by the

organization’s strategic plan arid available resources. Organizations manage their

portfolios based on specific goals. With Portfolio Management, organizations can

maximize the value of the portfolio by careful examination of various projects or

programs for inclusion in portfolio arid timely exclusion of projects not meeting the

portfolio’s strategic business objectives.

2.7.3. Sub-projects

Components of a project that are often contracted out is known as subproject. Projects

are frequently divided into more manageable components or subprojects. Subprojects

are often contracted to an external enterprise or to another functional unit in the

performing organization. Subprojects are based on the project process, such as a single

phase. Subprojects according to human resource skill requirements, such as the

installation of plumbing or electrical fixtures on a construction project or testing of

software by a skilled employee, etc.

2.7.4. Project Management Office (PMO)

A project management office (PMO) is an organizational unit to centralize and

coordinate the management of projects under its domain. A PMO can also be referred

to as a ‘program management office,” “project office.” or “program office.”

A PMO oversees the management of projects, programs, or a combination of both. The

projects supported or administered by the PMO may or may not be related other than

by being managed together. Some PMOs, however, do coordinate arid manage related

projects. In many organizations, those projects are indeed grouped or are related in

some manner based on the way the PMO will coordinate and manage those projects.

The PMO focuses on the coordinated planning, prioritization and execution of projects

and sub-projects that are tied to the parent organization’s or client’s overall business

objectives.


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2.8. Purpose of Project Management

The purpose of project management is to plan, manage and control activities so that the

project is successfully completed fulfilling the objective of customer and the performing

organization. The need for project management was never so important considering some

of the key following factors:

2.8.1. Intense competition in the global market place

Worldwide markets face incense competition from transnational, multi-national and

developing economies whose aim is to globalize all the countries’ economies across the

world. Such intense competition demands ready to market, what to build, whore to

build, how to build various products and services for global markets and communicate

with customers and other stakeholders. It is also challenging for all the global

corporations Lo manage their specialists and support human resources, and also manage

the challenges of marketing products and services and meeting the distribution needs.

2.8.2. Availability of human knowledge

With the availability of abundant human knowledge, specific knowledge is called for

solving specific/relevant problems associated with the development, production and

distribution of goods and services by ever increasing number of academic disciplines.

This expands the horizon of different types of projects that people can think of and put

thru. For Example, “Construction of a Technology Park requires multi-skilled human

resources with knowledge in the areas of civil, mechanical, electrical, water

management, environmental engineering, and Information Technology.

2.8.3. Increased demand for goods and services globally

With the explosion of population and globalization of world economy, all the

products/service providers are out in the market to fulfill ever-growing demand

throughout the world for a broad range of scientific, electronics, personal, industrial

inputs, raw materials, semi-finished, sophisticated, customized goods and services.

Consumerism is the keyword which has taken the world by storm. Meeting such rapidly

changing demands require design flexibility, coordination of group efforts, and change

control into all manufacturing and well entrenched distribution chain for supply of goods

and services with superior quality attributes and delivery on time, all the time.

There is also a demand for existing mass produced products which, needs a presence of

PM processes and a qualified project head. To give an example, moving factories

overseas to reduce manufacturing and shipping costs and to gain a physical presence in

where to


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an expanding market. Information Technology plays a major role in unifying the

manufacturer with their customer sitting elsewhere in the world and also satisfies their

need without customer or manufacturer meeting face to face with each other.

2.8.4. Requirement of teams instead of individuals

In the current trend, skill & knowledge and ability needed are not generally found to be

available in a single person and thus it is necessary to have a team, which possesses such

spectrum of skills/knowledge/ability to meet the customer needs or resolving a complex

problem. To successfully complete the large complex multinational projects, it is

essential that the team with varied skills and disciplines work together, within

organization structure, distant locations or contract entities, or combination of all.

2.9. Factors that have impact on Projects

The factors that affect a project's success include Type of Organization, processes,

knowledge, leadership style, culture, PM Information System and effective communication

etc. Each of these factors should be examined thoroughly as they will have a significant

impact on the project outcome. While several of these topics are covered in detail in the

later part of this handbook, this section explains how maturity of the organization with

respect to following elements can impact the project significantly:

2.9.1. Organizational Culture and Style

These cultures and styles are reflected in numerous factors:

Shared values, norms, beliefs, and expectations

Policies and procedures

View of authority relationships

Work ethics and work hours

2.9.2. Organizational Structure

The structure of any organization represents the hierarchy of people and its functions.

It sets the level of authority, roles and responsibilities and the reporting structure within

the project. Based on the nature of the business, organizations tend to adopt one of the

three types of structures for effective control on the day to day operational and project

management related work. Organizational structure define what level of authority and

control project manager can exercise on their team and how much decision making

power they will have with respect to the project.


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Following are the three types of organization structures that can be observed in

organizations:

2.9.2.1. Functional Organization

Functional organizations are made up of units or division based on the types of

businesses and their associated responsibility. This type of organizational structure

has clear reporting hierarchy and communication channels. Skills of the team

members are specific to the staff in a function/department and projects/project

team are specific to the function/department. Communication between

departments takes place through functional managers down to the project team and

Project manager may be known as a project coordinator or team leader.


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2.9.2.2. Projectized Organization

Organizations that derive revenue from performing projects for others fall under this

type. In Projectized Organizations, project manager works full time on the project

with his team and has complete or close to complete power over the project team.

Project Manager may have full time administrative staff to help expedite the project

and entire team reports directly to project manager


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2.9.2.3. Matrix Organization

Matrix organization is a blend of Functional and Projectized organization types. It

can be divided into three types:

2.9.2.3.1. Weak Matrix

Weak matrix structures map closely to a functional structure. Project team may

come from different departments, but the project manager reports directly to a

specific functional manager. Project manager has very limited authority in the

project and he is not more than a project coordinator.


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2.9.2.3.2. Balanced Matrix

A balanced matrix structure has many of the same attributes as a weak matrix,

but the project manager has more time and control over the project and shares

power with the functional manager. Team members generally face time-

accountability issues in this type of organization as they have dual reporting to

Functional Manager as well as Project manager.


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2.9.2.3.3. Strong Matrix

Strong matrix organization, has several attributes similar to the Projectized

organization. Project manager gains more control over resources and their time

when it comes to project work and he has little more authority than functional

managers when it comes to the project. The project team may also have more

time available for the project even though they may come from different

departments


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Comparison of Matrix Structures:

Below table illustrates the comparison of various elements in different types of Matrix

structure:

PM’s

Type

Of Matrix

Title Focus Authority Time Reports into

Weak

Matrix

Project

Coordinator /

Project Leader

Split between

project and

functional

Minimal Part time on

project

Functional

Manager

Balanced

Matrix

Project

Manager

Project work Balanced Full time on

project

Functional

Manager but

shares power

for project

Strong

Matrix

Project

Manager

Project work Complete Full time on

project

Manager of

projects


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2.9.2.4. Composite Organization

Composite organizational structure is an ad-hoc structure that is created to manage

a high-priority project for its duration. This type of project team organization consist

of highly skilled resources from various functions/departments and they report

directly to project managers for the project duration.

2.9.3. Project Management Information System

The project management system is the set of tools, techniques, methodologies,

resources, and procedures used to manage a project. PMS ensures consistency in

application and continuity on the various projects being performed. To facilitate the

project management activities, most of the organizations develop PMS that can include

automated tools, such as a scheduling software tool, configuration management system,

information collection and distribution system, or web interfaces to other online

automated systems.


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Chapter 3: Processes, Process

Groups and Knowledge Areas


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3. Processes, Process Groups and Knowledge Areas

This chapter provides an overview of the ten PMBOK® Guide Project Management

Knowledge Areas and the associated 47 processes and how they are aligned to 5 process

groups. Topics covered in this chapter provides an overview of the structure on which all

the later chapters are based.

3.1. Process

Process is defined as:

“A set of interrelated actions and activities performed to create a pre-specified product,

service, or result. Each process is characterized by its inputs, the tools and techniques that

can be applied, and the resulting outputs.”

Project Management is done with the help of Processes. Project team identifies the

processes that needs to be followed to meet/comply with project requirements while

balancing the triple constraints of a Project. A process is made up of Inputs, Tools &

Techniques and Outputs. Information or data is received from various sources in Inputs,

analyzed using specified Tools & Techniques and Output is churned out. Output of one

process can be an Input to other process(es). PMBOK Guide – 5th Edition has listed 47

processes spread across different knowledge areas and process groups. All processes

interact with each other throughout the project via their Inputs and Outputs. To manage a

project successfully, project team must manage and guide these interactions.

3.2. Project Management Process Group

Each project has a lifecycle and each phase of lifecycle is made up of certain distinctive

processes. The PMBOK guide outlines the interaction between the processes and the purpose

they serve. The logical grouping of these processes is called as process Groups and they

provide the logical sequence of steps and are aggregated into five process groups:

Initiating: Define and authorize the project or a project phase.

Planning: Define & refine objectives and plans the course of action required to attain

the project objective.

Executing: Integrate resources to carry out the project management plan for the

project.

Monitoring and Controlling: Measure and monitor progress to check if the any

corrective action is needed to meet project objectives.

Closing: Formalize acceptance of the product, services, or result and bring the project

or a project phase to an administrative end.


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PMBOK Guide - Fifth Edition provides a best-practice approach to handle project

management challenges across domains at all levels. The integrative approach of five

process groups yields positive results for if the project manager or team understand how

the five different process groups overlap throughout all phases of the project.

3.3. Knowledge Areas:

PMBOK Guide 5th Edition has formed set of processes based on specialized and focused

area. These processes together accomplish project management functions. There 10

distinctive focus areas are called Knowledge Areas and each knowledge area includes a

detailed description of processes associated with that area. The following list gives a brief

description of each of the Knowledge Areas:

Project Integration Management: Integrate different aspects of project.

Project Scope Management: Describes the processes required to ensure that the

project includes all the work required, and only the work required, to complete the

project successfully.

Project Time Management: Describes the processes required to ensure timely

completion of the project.

Project Cost Management: Describes the processes required to ensure that the

project is completed within the approved budget.


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Project Quality Management: Describes the processes that assure that the project

meets its quality goal satisfies the needs for which it was undertaken.

Project Human Resources Management: Describes the processes required to obtain

and manage the people and to make the most effective use of them.

Project Communication Management: Describes the processes required to ensure

timely and appropriate generation, collection, dissemination, storage and ultimate

disposition of project information.

Project Risk Management: Describes the processes concerned with identifying,

analyzing, and responding to project risk.

Project Procurement Management: Describes the processes required to acquire

goods and services from outside the performing organization.

Project Stakeholders Management: Describes the processes required to identify

people involved with the project and manage their expectations effectively.

3.4. Process Mapping to Knowledge Areas and Process Groups

The 47 processes in PMBOK Guide – 5th Edition are grouped into 5 process groups mentioned

above and they are spread across 10 Knowledge areas. This mapping reflects the logical

integration and interaction among the individual processes. Process groups club together

the processes that are relevant to respective functional area during specific project phase.

Following table shows mapping of 47 processes to process groups and knowledge areas:

Knowledge

Area

Project Management Process Groups

Initiating Planning Executing Monitoring and

Controlling

Closing

4. Project

Integration

Management

4.1 Develop Project Charter

4.2 Develop Project Management Plan

4.3 Direct and Manage Project Work

4.4 Monitor and Control Project Work

4.5 Perform Integrated Change Control

4.6 Close Project or Phase

5. Project

Scope

Management

5.1 Plan Scope Management

5.2 Collect Requirements

5.3 Define Scope

5.5 Validate Scope

5.6 Control Scope


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5.4 Create WBS

6. Project

Time

Management

6.1 Plan Schedule Management

6.2 Define Activities

6.3 Sequence Activities

6.4 Estimate Activity Resources

6.5 Estimate Activity Durations

6.6 Develop Schedule

6.7 Control Schedule

7. Project

Cost

Management

7.1 Plan Cost Management

7.2 Estimate Costs

7.3 Determine Budget

7.4 Control Costs

8. Project

Quality

Management

8.1 Plan Quality Management

8.2 Perform Quality Assurance

8.3 Control Quality

9. Project HR

Management

9.1 Plan Human Resource Management

9.2 Acquire Project Team

9.3 Develop Project Team

9.4 Manage Project Team

10. Project

Communicatio

n Management

10.1 Plan Communications Management

10.2 Manage Communications

10.3 Control Communications

11. Project

Risk

Management

11.1 Plan Risk Management

11.2 Identify Risks

11.3 Perform Qualitative Risk Analysis

11.4 Perform Quantitative Risk Analysis

11.5 Plan Risk Responses

11.6 Control Risks


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12. Project

Procurement

Management

12.1 Plan Procurement Management

12.2 Conduct Procurements

12.3 Control Procurements

12.4 Close Procurements

13. Project

Stakeholder

Management

13.1 Identify Stakeholders

13.2 Plan Stakeholder Management

13.3 Manage Stakeholder Engagement

13.4 Control Stakeholder Engagement


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Chapter 4: Project Integration

Management


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4. Project Integration Management

Project Integration Management includes the processes and activities to identify, define,

combine, unify, and coordinate the various processes and project management activities

within the Project Management Process Groups.

The PMBOK Guide – 5th Edition.

Project Integration Management consist of high level process which are performed to ensure

all the elements of the project are properly coordinated. It involves controlling changes to

the overall project and making tread offs to ensure stakeholder’s objectives are being met.

Project Integration Management is comprised of following processes:

Knowledge

Area


Initiating Planning Executing

Monitoring

and

Controlling

Closing

4 Project

Integration

Management

4.1 Develop Project Charter

4.2 Develop Project Management Plan

4.3 Direct and Manage Project Work

4.4 Monitor and Control Project Work

4.5 Perform Integrated Change Control

4.6 Close Project or Phase

4.1. Develop Project Charter:

Develop Project Charter is the first process to be carried out in any project. Developing the

Project charter is primarily concerned with documenting the business needs, project

justification, current understanding of the customer’s requirements, and the new product,

service, or result that is intended to satisfy those requirements.

A project can be linked to the ongoing work of the organization by preparing the project

charter. In some organizations, a project is not formally chartered and initiated until

completion of a needs assessment, feasibility study, preliminary plan, or some other

equivalent form of analysis that was separately initiated.

An illustration of Inputs, Tools & techniques and Outputs of this process is given below:


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Develop Project Charter

Inputs Tools and Techniques Outputs

Project Statement of

Work

Business Case

Agreements

Enterprise Environmental

Factors

Organizational Process

Assets

Expert Judgment

Facilitation Techniques

Project Charter

4.1.1. Develop Project Charter - Inputs

4.1.1.1. Project Statement of Work

The project management system is the set of tools, techniques, methodologies,

resources, and procedures used to manage a project. PMS ensures consistency in

application and continuity on the various projects being performed.

To provide clear directions to project management team, products or services to be

supplied by the protect arc described in the Statement of Work (SoW). The project

initiator or sponsor provides the SoW based on business needs, product, or service

requirements for internal projects whereas the statement of work can be received

from the customer as part of a bid document for external projects, for example,

request for proposal, request for information, request for bid, or as part of a

contract.

The SoW contains the product requirements and characteristics of the product or

service that the project will be undertaken to create. Since the product

characteristics are progressively elaborated, the product requirements will have

fewer details during the initial process and more details during later processes.

These requirements must also document the relationship among the products or

services being created and the business need or other stimulus that causes the need.


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Even though the form and substance of the product requirements document will

vary, it should always be detailed enough to support later project planning

processes.

4.1.1.2. Business need

Projects are identified and chartered for various business needs from different

quarters. A societal problem could become a project for a service provider or new

group users seeking a new product or an extension of the old product or

technological change creating a new business opportunity (mobile phone, digital

camera or metro rail system or MRTS system, etc.) Or a marketing company

authorizing a “market research’ project to validate market response to the “release

of new product line into the market”. Some of such needs are illustrated below:

Request from a Customer: A mobile company authorizing a project to

put up towers to serve a new township.

A market demand: A railway company authorizing a project to build

underground train to reduce the surface travel time.

A technological advance: With the advent of digital cameras and its

advantage over the conventional camera, the need for digital camera has

created a new business opportunity among individual, professional, movie and

all other users of camera around the globe.

A legal requirement: Example: Government’s Legal requirement for the

textile/garment manufacturers to implement “water treatment plant” to reduce

the toxic effluent getting into water bodies and cultivable land. This

implementation will be taken as a project by the garment manufacturers to meet

such Legal need.

A social need: Example: Rotary Club engaged ¡n authorizing projects to

alleviate social needs Like “HIV/AIDS awareness campaign”, “Blood Bank

Camps”, ‘Education for underprivileged children” in the rural and semi-urban

areas.

The above requirements may be known as problems, opportunities, or business

requirements. The central theme of all the requirements is that management must

make a decision about how to respond and what projects to authorize and charter,

Project selection methods involve measuring value or attractiveness to the project

owner or sponsor and may include other organizational decision criteria. Project

selection also applies to choosing alternative ways of executing the project.


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4.1.1.3. Agreements

If the project is being done for an external customer, a contract from the customer

is treated as an Input.

4.1.1.4. Enterprise Environmental Factors

Project’s success is influenced and surrounded by the organization’s enterprise

environmental factors and systems which must be considered when developing the

project charter. This includes following items:

Organizational Culture and Structure: Culture is a “shared value’ among the

entire workforce and the structure indicates as to how the whole company’s

functional framework is in place with appropriate communication channels and

approval levels. Complex structure will itself be a constraint for the organization

to pull through successful project completion. Whereas projectized organization

having fiat organization structure” will more amenable to the project Success.

Governmental or industry standards: Regulatory agency regulations, product

standards, quality standards, and workmanship standards etc. are some example

of governmental or industry standard which has an impact on project planning

and execution. ISO 9001:2000 or BIS 150(X), CMMIor Six Sigma are considered

the Quality standards and governmental regulations like FEMA or product

standards like ISI or Agmark are the key factors to be considered while

developing project charter.

Organizations’ human capital: Technical, managerial and administrative skills,

functional discipline, and knowledge, such as product design, service framework

development, secretarial, Legal, logistics, inventory management, supply chain

management, quality management, business process knowledge etc.

Market Condition and Global Competition: The intensity of the project

increases or decreases based on the fact that as to which market the company

competes with and what is the intensity of the competition in that market

segment. To give a simple example, if the company is engaged in high intensity

zone where it is expected to meet consistently the customers (coming from

different segments with product variants, per se a challenge to meet with.

Therefore, in such organizations the project teams’ success of product

development is a paramount importance foe company’s survival. On the

contrary, if the company’s existence in a market is, by and large less intensive

and thus the project teams’ will have a different intensity to work with.


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Project Management Information System: Project Management Information

Systems (PMIS) is a collection of tools such as a scheduling software tool,

configuration management system, information collection & distribution

system, or web interfaces to other online automated systems.

4.1.1.5. Organizational Process Assets

All or any of the assets that may influence the project’s success can be drawn from

organizational process assets during the development of the project charter and

subsequent project documentation. Effects of the formal and informal policies,

procedures, plans, and guidelines, followed by performing and involved

organizations in the project must be considered. Organizational process assets also

represent the organization’s learning and knowledge from previous projects, for

example, completed schedules, risk data, and earned value data. Organizational

Process Assets can be grouped into following two categories:

1) Organization’s processes and procedures for carrying out the work

2) Organizational knowledge base for storing and retrieving information

4.1.2. Develop Project Charter – Tools and Techniques

4.1.2.1. Expert Judgment

Access to the inputs require to develop the project charter is often provided by

Expert Judgment. Such judgment and expertise is applied to any technical and

management details during this process. Such expertise is provided by any group or

individual with specialized knowledge or training and can be made available from

several sources including:

Other departments/units within the organization

Consultants

Stakeholders including customers or sponsors

Professional and technical associations

Industry groups.

4.1.2.2. Facilitation techniques

Facilitation techniques is one of the most commonly used Tools & Techniques used

to help teams and individuals to brainstorm, resolve conflicts, solve problems and

manage the meetings. In Develop Project Charter process facilitation techniques

are used to collaborate the efforts of stakeholders to translate the requirements of

the customers to high-level objectives.


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4.1.3. Develop Project Charter – Outputs

4.1.3.1. Project Charter

The only output of this process is “Project Charter” which is released by the Senior

Management Executive either the Sponsor or the initiator to signify that the project

or its phase becomes in existence and also authorize the Project Manager to utilize

organization’s resources, people, machine, materials and money to achieve project

objectives. The senior management executive identifies a Project Manager and

assigns the project to project manager by formally handing over the project charter.

Project charter provides high-level overview of the project. It may include following

details:

Project Title

Project Description

Objectives

Project Scope Overview

Major Deliverables

Key Milestones

Business Case

Financial Benefits

Top Management’s Approval

Project Manager’s Acceptance

4.2. Develop Project Management Plan:

The process of defining how a project is planned should be executed, monitored and

controlled and closed is called as The Develop Project Management Plan. It includes the

actions necessary to define, integrate, and coordinate all subsidiary plans. The project

management plan content may vary depending upon the application area and complexity of

the project. This process results in a project management plan that may be updated and

revised through the Integrated Change Control process.


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Develop Project Management Plan


Project Charter

Outputs From Other

Processes


Factors


Assets

Expert Judgment

Facilitation Techniques

Project Management

Plan

4.2.1. Develop Project Management Plan – Inputs


Described in section 4.1.3.1. Project Charter provides the reference to start the

detailed project planning processes.

4.2.1.2. Output from other processes

The primary objective of Develop Project Management Plan process is to combine

and unify output from other planning processes. All the subsidiary plans and

baselines that are created in all relevant knowledge areas are unified and combined

in this process.

4.2.1.3. Enterprise Environmental Factor

The enterprise environmental factors that can influence the Develop Project

Management Plan process include:

Governmental or industry standards

Project management body of knowledge for vertical market

Project management information system


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Organizational process assets provides a list of policies, procedures, and guidelines,

controls procedures, Historical information and lessons learned knowledge bases

that is used as a key input in developing the Project Management plan.

4.2.2. Develop Project Management Plan – Tools and Techniques


Expertise is needed to develop project management plan can provided by any group

or individual with specialized knowledge or training and can be made available from



Consultants



Industry groups.

4.2.2.2. Facilitation Techniques

Facilitation techniques is one of the most commonly used Tools & Techniques used

to help teams and individuals to brainstorm, resolve conflicts, solve problems and

manage the meetings.

4.2.3. Develop Project Management Plan – Output

4.2.3.1. Project Management Plan

It can be composed of one or more subsidiary plans and other components and it

can be either summary level or detailed. Each of the subsidiary plans and

components is detailed to the extent required by the specific project. These

subsidiary plans include:

Project Scope Management Plan

Schedule Management Plan

Cost Management Plan

Quality Management Plan (Including Process Improvement Plan)

Staffing Management Plan

Communication Management Plan

Risk Management Plan

Procurement Management Plan


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Stakeholders Management Plan

These subsidiary plans may contain the following components:

Resource Calendar

Cost Baseline

Milestone List

Schedule Baseline

Quality Baseline

Risk Register

4.3. Direct and Manage Project Work:

In order to accomplish the work defined r the project scope statement, the project manager

and the project team need to execute the project management plan performing multiple

actions defined in this process. Some of these actions are:

Perform activities to accomplish project objectives

Expend effort and spend funds to accomplish the project objectives

Hire, train and manage the project team members assigned to the project

Obtain quotations, bids, offers, or proposals as appropriate

Select sellers by choosing from among potential setters

Obtain, manage, and use resources including materials, tools, equipment’s and

facilities

Implement the planned methods and standards

Manage sellers

Incorporate approved changes into the project’s scope, plans, and environment

Establish and manage project communication channels, both external and internal

to the project team

Collect project data and report cost, schedule, technical and Quality progress, and

status information to facilitate forecasting

Collect and document Lessons learned, and implement approved process

improvement activities.

The project manager manages the various technical and organizational interfaces that exist

within the project and directs the performance of the planned project activities along with

the project management team. The project application area generally affects the Direct

and Manage Project Work process directly. The project work planned and scheduled in the


45 | P a g e

project management plan to accomplish Deliverables are outputs from the processes. Work

performance information about the completion status of the deliverables, and what has

been accomplished, is collected as part of project execution and is fed into the performance

reporting process.

Although the products, services, or results of the project are frequently in the form of

tangible deliverables such as buildings, roads, etc. and intangible deliverables, such as

training, can also be provided. Direct and Manage Project Work also requires

implementation of:

Approved corrective actions that will bring anticipated project performance into

compliance with the project management plan.

Approved preventive actions to reduce the probability of potential negative

consequences.

Approved defect repair requests to correct product defects found by the quality

process.

Direct & Manage Project Work


Project Management

Plan

Approved Change

Requests

Enterprise

Environmental Factors


Assets

Expert Judgment

Project Management

Information System

Meetings

Deliverables

Work Performance Data

Change Requests

Project Management Plan

update

Project Document

Update

4.3.1. Direct and Manage Project Work – Inputs





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Resource Calendar

Cost Baseline

Milestone List

Schedule Baseline

Quality Baseline

Risk Register

4.3.1.2. Approved Change Request

In order to expand or contract project scope, authorized changes are documented

Change Requests that can also modify policies, project management plans,

procedures, costs or budgets, or revise schedules. Approved change requests are

scheduled for implementation by the project team.


The Direct and Manage Project Work process is influenced by enterprise

environmental factors that include:

Organizational, company, or customer culture and structure of the performing

or sponsor organizations

Infrastructure

Personnel administration

Stakeholder risk tolerances



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Organizational process assets provides a list of policies, procedures, and guidelines,

controls procedures, Historical information and lessons learned knowledge bases

that is used as a key input in developing the Project Management plan.

4.3.2. Direct and Manage Project Work – Tools and Techniques


Expertise is needed to Direct and Manage Project work can provided by any group or




Consultants



Industry groups.

4.3.2.2. Project Management Information System

Standardized set of automated toots available within the organization are integrated

into a system that is catted as the Project Management Information System (PMIS).

The PMIS is used by the project management team to support generation of a project

plan, facilitate feedback as the document is refined, control changes to the project

plan, and release the approved document.

4.3.2.3. Meetings

While directing and managing project work, project manager, project team and

stakeholders may need to conduct meetings to discuss and address pertinent topics

of the project. Meetings are tend to be one of three types:

Information Exchange

Brainstorming, option evolution or design or

Decision making


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Actions for Direct & Manage project Work

Implementing the Project Plan

Completing work packages

Achieving expected work results

Committing project resources as per Project Plan

Monitoring project progress against project baseline

Implementing corrective or preventive actions

Guiding, leading and assisting project team, communicating and

negotiating with stakeholders

Holding team meetings

Identify changes needed to be handled in Integrated Change Control

process

Implementing Quality Assurance procedures

4.3.3. Direct and Manage Project Work – Outputs

4.3.3.1. Deliverables

Any verifiable product, service or result (or part of it) which is identified in the

project management planning documentation is considered as deliverable which

must be produced and provided to complete the project.

4.3.3.2. Work Performance Data

Work performance data is the lowest level of detail coming from raw observations

and measurements of activities while carrying out the project work. Raw data is

gathered throughout the execution phase and passed to the controlling processes of

each process area for detailed analysis. Work Performance Data includes work

completed, KPIs, start/finish dates of activities, number of defects, actual duration

and cost etc.


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4.3.3.3. Change Requests

While the project work is being performed requests for direct or indirect charges to

expand or reduce project scope, to modify policies or procedures, to modify project

cost or budget, or to revise the project schedule are often identified and

documented as requested changes. Requests for a change can be, externally or

internally initiated, and can be optional or legacy/contractually mandated.

4.3.3.4. Project Management Plan update

Elements of the project management plan that may be updated include, but are not

limited to:

Scope management plan,

Requirements management plan,

Schedule management plan,

Cost management plan,

Quality management plan,

Process improvement plan,

Human resource management plan,

Communications management plan,

Risk management plan,

Procurement management plan,

Stakeholder management plan, and

Project baselines.

4.3.3.5. Project Document Update

Project documents that may be updated include, but are not limited to:

Requirements documentation,

Project logs (issues, assumptions, etc.),

Risk register, and

Stakeholder register.


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4.4. Monitor and Control Project Work:

To monitor project processes associated with initiating, planning, executing, and closing,

the Monitor and Control Project Work process is performed. Corrective or preventive actions

are taken co control the project performance. One of the aspect of project management

performed throughout the project is monitoring that includes collecting, measuring, and

disseminating performance information, and assessing measurements & trends to influence

process improvements. Continuous monitoring identifies any areas that can require special

attention and gives the project management team insight into the health of the project.

The Monitor and Control Project Work process is concerned with:

Comparison of actual project performance with the project management plan

Recommending corrective or preventive actions as necessary by assessing

performance to determine if any are indicated.

Make sure that the risks are Identified by analyzing, tracking, and monitoring project,

their status is reported and appropriate risk response plans are being executed

Maintaining an accurate, timely information base concerning the project’s product(s)

and their associated documentation through project completion

Providing information to support status reporting, progress measurements, and

forecasting

Providing forecasts to update current cost and current schedule information

Monitoring Implementation of approved changes when and as they Occur,

Monitor and Control Project Work



Schedule Forecasts

Cost Forecasts

Validated Changes

Work performance

Information

Expert Judgment

Analytical Techniques

Project Management

Information Systems

Meetings

Change Requests

Work Performance

Reports

Project Management

Plan update

Project Document

Update


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Factors


Assets

4.4.1. Monitor & Control Project Work – Inputs
















Resource Calendar

Cost Baseline

Milestone List

Schedule Baseline

Quality Baseline

Risk Register


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4.4.1.2. Schedule Forecasts

The schedule forecast provides variance against the planned finish dates and

forecasted finish dates for various tasks and overall project. Forecast is calculated

from progress against the schedule baseline and computed time estimate to

complete (ETC) which is generally expressed in terms of schedule variance (SV) and

schedule performance index (SPI).

4.4.1.3. Cost Forecast

The cost forecasts provides variances against the planned versus actual expenditures

and forecasted final costs. Cost forecast is calculated derived from progress against

the cost baseline and computed estimates to complete (ETC) which is generally

expressed in terms of cost variance (CV) and cost performance index (CPI). An

estimate at completion (EAC) can be compared to the budget at completion (BAC)

to see if the project is still within tolerance ranges or if a change request is required.

4.4.1.4. Validated Changes

Approved changes that result from the Perform Integrated Change Control process

require validation to ensure that the change was appropriately implemented. A

validated change provides the necessary data to confirm that the change was

appropriately executed.

4.4.1.5. Work Performance Information

As a part of the project management plan execution, the work performance data is

analyzed in context and integrated based on the relationship across areas. Work

performance data gets transformed into Work Performance Information and provides

a basis for decisions making associated with project.


The Monitor and Control Project Work process is influenced by enterprise

environmental factors that include:

Governmental or industry standards

Organization work authorization systems

Stakeholder risk tolerances



53 | P a g e


The organizational process assets that can influence the Monitor and Control Project

Work process include:

Organizational communication requirements

Financial controls procedures

Change control procedures


Process measurement database used to make available measurement data on

processes and products

Lessons learned database

4.4.2. Monitor & Control Project Work – Tools and Techniques


Expert judgment is used by the project management team to interpret the

information provided by the monitor and control processes.

4.4.2.2. Analytical Techniques

Analytical techniques are applied in project management to forecast potential

outcomes based on possible variations of project or environmental variables and

their relationships with other variables. Examples of analytical techniques used in

projects are:

Regression analysis

Grouping methods

Causal analysis,

Root cause analysis

Forecasting methods (e.g., time series, scenario building, simulation, etc.)

Failure mode and effect analysis (FMEA)

Fault tree analysis (FTA)

Reserve analysis

Trend analysis

Earned value management

Variance analysis.


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4.4.2.3. Project Management Information System

The project management information system, which is part of enterprise

environmental factors, provides access to automated tools, such as scheduling, cost,

and resourcing tools, performance indicators, databases, project records, and

financials used during the Monitor and Control Project Work process.

4.4.2.4. Meetings

Meetings may be face-to-face, virtual, formal, or informal. They may include project

team members, stakeholders, and others involved in or affected by the project.

4.4.3. Monitor & Control Project Work – Outputs


As a result of variance analysis, change requests may be issued to expand, adjust,

or reduce project scope, product scope, or quality requirements and schedule or

cost baselines. It may include Corrective or Preventive actions or actions for defect

repair.

4.4.3.2. Work Performance Reports

Work performance reports are status reports, information notes, recommendations,

and updates to help project team and stakeholders to take decisions, actions, or

awareness. Source of work performance reports is the work performance information

that is compiled in the project documents.

4.4.3.3. Project management Plan Update

Changes identified during the Monitor and Control Project Work process may affect

the overall project management plan. These changes, after being processed through

the appropriate change control process can lead to project management plan

updates.

4.4.3.4. Project Document Update

Schedule and cost forecasts, Work performance reports and Issue log are some of

the project documents that may be updated.


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4.5. Perform Integrated Change Control

The project management plan, the project scope statement and other deliverables must be

maintained carefully & continuously either by rejecting or approving changes so approved

changes can be incorporated into a revised baseline. Integrated Change Control process is

performed from project inception through completion. Since projects seldom run exactly

according to the project management plan, change control becomes necessary.

Perform Integrated Change Control



Work Performance Reports

Change requests


factors

Organizational process

assets

Expert Judgment

Meetings

Change Control Tools

Approved Change Requests

Change Log


updates

Project Document Updates

4.5.1. Perform Integrated Change Control – Inputs















56 | P a g e



Resource Calendar

Cost Baseline

Milestone List

Schedule Baseline

Quality Baseline

Risk Register


It provides documentation about project performance against the project

management plan. Results from performance areas like control schedule, control

cost, control quality, scope verification, and procurement audits and their related

forecasts assists the project team management In determining future human

resource requirements, recognition and rewards and updates to HR Management

plan.

4.5.1.3. Change requests

Requests for direct or indirect charges to expand or reduce project scope, to modify

policies or procedures, to modify project cost or budget, or to revise the project

schedule are often identified and documented as requested changes. Requests for a

change can be, externally or internally initiated, and can be optional or

legacy/contractually mandated.

4.5.1.4. Enterprise Environmental factors

Project management information system is one of the key enterprise environmental

factor can influence the Perform Integrated Change Control process. PMIS may

include the scheduling software tool, a configuration management system, an

information collection and distribution system, or web interfaces to other online

automated systems.

4.5.1.5. Organizational process assets

The organizational process assets that can influence the Perform Integrated Change

Control process include:


Procedures for approving and issuing change authorizations


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Process measurement database

Project documents

Configuration management knowledge base

4.5.2. Perform Integrated Change Control – Tools and Techniques


Stakeholders may be asked to provide their expertise and may be asked to sit on the

change control board (CCB). Such judgment and expertise are applied to any

technical and management details during this process and may be provided by

various sources

4.5.2.2. Meetings

Meetings are usually referred to as change control meetings. When needed for the

project, a change control board (CCB) is responsible for meeting and reviewing the

change requests and approving, rejecting, or other disposition of those changes.

4.5.2.3. Change Control Tools

Manual or automated tools to manage the change requests and resulting decisions

with respect to change and/or configuration management. Types of tools that can

be used is based on the requirements of the project stakeholders considering the

enterprise environment and/or constraints.

4.5.3. Perform Integrated Change Control – Outputs

4.5.3.1. Approved Change Requests

A change request that has been processed through the integrated change control

process and approved by change control board. Approved change requests are

implemented through the Direct and Manage Project Work process.

4.5.3.2. Change Log

A comprehensive list of changes made during the project. This typically includes

dates of the change and impacts in terms of time, cost, and risk. Rejected change

requests are also documented in Change Log.

4.5.3.3. Project Management Plan updates

Key outcome of Integrated Change Control Process is updates to any subsidiary plans

and baselines subject to decision by change control board. Changes to baselines


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should only show the changes from the current time forward. Past performance may

not be changed.

4.5.3.4. Project Document Updates

Project documents that may be updated as a result of the Perform Integrated Change

Control process include all documents specified as being subject to the project’s

formal change control process.

4.6. Close Project or Phase

The project closure portion of the project management plan is performed through the Close

Project or Phase process. This process closes out the portion of the project scope and

associated activities applicable to a given phase in multi-phase projects. This process

includes finalizing ail activities completed across all Project Management Process Groups to

formally close the project or a project phase, and transfer the completed or cancelled

project as appropriate. The Close Project process also establishes the procedures to

coordinate activities needed to verify and document the project deliverables, to coordinate

and interact to formalize acceptance of those deliverables by the customer or sponsor, and

to investigate and document the reasons for actions taken if a project is terminated before

completion.

Close Project Or Phase



Accepted Deliverables


assets

Expert Judgment


Meetings

Final Product, Service, or

Result transition


Assets Updates


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4.6.1. Close Project Or Phase – Inputs


The project management plan becomes the agreement between the project

manager and project sponsor, defining what constitutes project completion.

4.6.1.2. Accepted Deliverables

Approved product specifications, delivery receipts, and work performance

documents. Partial or interim deliverables may also be included for phased or

cancelled projects.


The organizational process assets that can influence the Close Project or Phase

process are Project or phase closure guidelines or requirements and Historical

information and lessons learned knowledge base.

4.6.2. Close Project Or Phase – Tools and Techniques


Experts Judgment ensure the project or phase closure is performed to the

appropriate standards. Expertise is available from many sources like other project

managers within the organization and Project management office (PMO).


Regression analysis and trend analysis are some of the key analytical techniques that

will be used in project closure.

4.6.2.3. Meetings

Meetings may include project team members and other stakeholders, involved in or

affected by the project.

4.6.3. Close Project Or Phase – Outputs

4.6.3.1. Final Product, Service, or Result transition

Formal statement that the terms of the contract have been met and hand over of

the final product, service or result that the project was authorized to produce.


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4.6.3.2. Organizational Process Assets Updates

Development of the index and Location of project documentation are included in

the Closure. The documents that are updated are, but not limited to:

Project Files: Project files are documentation resulting from the project’s

activities like project management plan, scope, cost, schedule and quality

baselines, project calendars, risk register, planned risk response actions, and

risk impact.

Project Closure Documents: These documents consist of formal documentation

indicating completion of the project and the transfer of the completed project

deliverables to others, such as Operations group. If the project was terminated

prior to completion, the formal documentation indicates why the project was

terminated, and formalizes the procedures for the transfer of the finished and

unfinished deliverables of the cancelled project to others.

Historical Information: Lessons learned are transferred to the lessons learned

knowledge base for use by future projects or phases. This can include

information on issues and risks as well as techniques that worked well that can

be applied to future projects.


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Chapter 5: Project Scope

Management


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5. Project Scope Management

Project Scope Management includes the processes required to ensure that the project includes

all the work required, and only the work required, to complete the project successfully.

Managing the project scope is primarily concerned with defining and controlling what is and is

not included in the project. ThePMBOK®Guide – 5th Edition.

Knowledge

Area



Monitoring

and

Controlling

Closing

5 Project Scope

Management

5.1 Plan Scope Management

5.2 Collect Requirements

5.3 Define Scope

5.4 Create WBS

5.4 Validate Scope

5.5 Control Scope

5.1. Plan Scope Management

Project’s overall success depends on proper definition and effective management of the

project scope. Projects required a careful balance of tools, data sources, methodologies,

processes and procedures, and other factors to ensure that the effort spent on scoping

activities is adequate as per size, complexity, and importance of the project. The project

scope management plan describes:

How project scope will be defined

How detailed project scope statement will be developed

How work breakdown structure will be created

How scope verification will be performed

How project scope control will be done.


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Plan Scope Management



Project Charter


Factors


assets

Expert Judgment

Meetings

Scope Management Plan

Requirements Management

Plan

5.1.1. Plan Scope Management – Inputs







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Resource Calendar

Cost Baseline

Milestone List

Schedule Baseline

Quality Baseline

Risk Register


The project charter provides the project context needed to plan the scope

management processes. It provides the high-level project description and product

characteristics from the project statement of work.


The enterprise environmental factors that can influence the Plan Scope

Management process include:

Organization’s culture

Infrastructure

Personnel administration

Marketplace conditions


Historical information, lessons learned knowledge base and Policies & procedures

are the key elements of organizational process assets that may influence the Plan

scope management process.


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5.1.2. Plan Scope Management – Tools and Techniques


Experts Judgment refers to input received from knowledgeable and experienced

parties. Expertise is available from many sources like other project managers within

the organization and Project management office (PMO).

5.1.2.2. Meetings

Meetings may include project team members and other stakeholders, involved in or

affected by the project.

5.1.3. Plan Scope Management – Outputs

5.1.3.1. Scope Management Plan

Scope Management Plan is a part of the project management plan. It provides

guidance on how project scope will be defined, documented, verified, managed and

controlled. The components of a project scope management plan include:

Process to prepare a Project Scope Statement

Process to create WBS

Process for maintaining WBS and its approval

Process for verification and acceptance of project deliverables

Process to control changes in project scope. (This process is linked with

integrated Change control process.)

5.1.3.2. Requirements Management Plan

Requirements Management Plan is a part of the project management plan. It

provides guidance on how requirements will be analyzed, documented, and

managed. The components of a project scope management plan may include:

How requirements activities will be planned, tracked, and reported

Requirements prioritization process

Product metrics that will be used and the rationale for using them

Requirement attributes will be captured on the traceability matrix

5.2. Collect Requirements

Collect Requirements is the process of determining, documenting, and managing

stakeholder needs and requirements to meet project objectives.


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Collect Requirements



Requirements Management

Plan

Stakeholders Management

Plan

Project Charter

Stakeholders Register

Interviews

Focus groups

Facilitate workshops

Group creativity

techniques

Group decision making

techniques

Questionnaires and

surveys

Observations

Prototypes

Benchmarking

Context Diagram

Document Analysis

Requirements

documentation

Requirements traceability

matrix

5.2.1. Collect Requirements – Inputs


The scope management plan provides clarity as to how project teams will determine

which type of requirements need to be collected for the project.

5.2.1.2. Requirements Management Plan

The requirements management plan provides the processes that will be used

throughout the Collect Requirements process to define and document the

stakeholder needs.


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5.2.1.3. Stakeholders Management Plan

The stakeholder management plan is required to understand stakeholder

communication requirements in order to assess and adapt to the level of stakeholder

participation in requirements activities.


The project charter is used to provide the high-level description of the product,

service, or result of the project so that detailed requirements can be developed.

5.2.1.5. Stakeholders Register

The stakeholder register provides an exhaustive list of the key stakeholders who will

provide the requirements and it also captures their main expectations.

5.2.2. Collect Requirements – Tools and Techniques

5.2.2.1. Interviews

A formal or informal approach to elicit information from stakeholders by talking to

them directly.

5.2.2.2. Focus groups

An elicitation technique that brings together prequalified stakeholders and subject

matter experts to learn about their expectations and attitudes about a proposed

product, service, or result.

5.2.2.3. Facilitate workshops

An elicitation technique using focused sessions that bring key cross-functional

stakeholders together to define product requirements.

5.2.2.4. Group creativity techniques

Techniques that are used to generate ideas within a group of stakeholders.

5.2.2.5. Group decision making techniques

Techniques to assess multiple alternatives that will be used to generate, classify,

and prioritize product requirements.

5.2.2.6. Questionnaires and surveys

Written sets of questions designed to quickly accumulate information from a large

number of respondents.


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5.2.2.7. Observations

A technique that provides a direct way of viewing individuals in their environment

performing their jobs or tasks and carrying out processes.

5.2.2.8. Prototypes

A method of obtaining early feedback on requirements by providing a working model

of the expected product before actually building it.

5.2.2.9. Benchmarking

Benchmarking is the comparison of actual or planned practices, such as processes

and operations, to those of comparable organizations to identify best practices,

generate ideas for improvement, and provide a basis for measuring performance.

5.2.2.10. Context Diagram

A visual depiction of the product scope showing a business system (process,

equipment, computer system, etc.), and how people and other systems (actors)

interact with it.

5.2.2.11. Document Analysis

An elicitation technique that analyzes existing documentation and identifies

information relevant to the requirements.

5.2.3. Collect Requirements – Outputs

5.2.3.1. Requirements documentation

A description of how individual requirements meet the business need for the project.

5.2.3.2. Requirements traceability matrix

A grid that links product requirements from their origin to the deliverables that

satisfy them. The implementation of a requirements traceability matrix helps ensure

that each requirement adds business value by linking it to the business and project

objectives.


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5.3. Define Scope

Define Scope process provides a detailed project scope statement which is critical to project

success. In this process, the project scope is defined with greater details and with more

specific Information about the project. Stakeholder needs & expectations are detailed in

this document. The assumptions and constraints are analyzed and detailed in this process.

Define Scope



Project charter

Requirements documentation

Organizational process assets

Expert Judgment

Product analysis

Alternatives

generation

Facilitated workshops

Project scope

statement

Project document

updates

5.3.1. Define Scope – Inputs


The scope management plan is a component of the project management plan that

establishes the activities for developing, monitoring, and controlling the project

scope.

5.3.1.2. Project charter

The project charter provides the high-level project description and product

characteristics. It also contains project approval requirements.


A description of how individual requirements meet the business need for the

project.


Policies, procedures, templates, project files from previous projects and lessons

learned from previous phases or projects are the part of Organizational Process

Assets that can influence the define scope.


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5.3.2. Define Scope – Tools and Techniques


Expert judgment is often used to analyze the information needed to develop the

project scope statement. Such judgment and expertise is applied to any technical

detail.

5.3.2.2. Product analysis

Product Analysis can be done in projects which have a product as the final output.

Product Analysis helps translate high level product description into smaller &

tangible deliverables.

5.3.2.3. Alternatives generation

Alternatives generation is a technique used to develop as many potential options as

possible in order to identify different approaches to execute and perform the work

of the project.

5.3.2.4. Facilitated workshops

An elicitation technique using focused sessions that bring key cross-functional

stakeholders together to define product requirements.

5.3.3. Define Scope – Outputs

5.3.3.1. Project scope statement

The project scope statement is a detailed description of project work and

deliverables along with project boundaries. It provides a common understanding of

the project scope among all stakeholders and describes the project’s objectives in

detail. It helps in further detailed planning, guides during execution, and creating

scope baseline. The detailed project scope statement Includes:

Project Objectives

Product Scope Description

Project Requirements

Project Boundaries

Project Deliverables


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Product Acceptance Criteria

Project Constraints

Project Assumptions

Initial Project Organization

Initial identified risks

Schedule Milestones

Fund Limitation

Project Configuration Management Requirements

Approval Requirements

5.3.3.2. Project document updates

Project documents that may be updated are:

Stakeholder register


Requirements traceability matrix

5.4. Create WBS

The Work Breakdown Structure (WBS) is a deliverable oriented hierarchical decomposition

of the work to be performed by the project team to create the deliverables. The WBS

subdivides the project work into smaller, more manageable pieces of work. Each tower level

of the WBS represents further detailed breakup of the project work. The lowest level nodes

are called work packages, which can be scheduled, estimated, monitored, and controlled

by an individual or a team.

Create WBS



Project scope statement

Requirements

documentation


Factors

Decomposition

Expert Judgment

Scope Baseline

Project document

updates


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assets

5.4.1. Create WBS – Inputs


The scope management plan specifies how to create the WBS from the detailed

project scope statement and how the WBS will be maintained and approved.

5.4.1.2. Project Scope Statement

The project scope statement describes the work that will be performed and the work

that is excluded.


A description of how individual requirements meet the business need for the project.


Industry-specific WBS standards, relevant to the nature of the project, may serve as

external reference sources for creation of the WBS.


Policies, procedures, templates, project files from previous projects and lessons

learned from previous phases or projects are the part of Organizational Process

Assets that can influence the Create WBS process.

5.4.2. Create WBS – Tools and Techniques

5.4.2.1. Decomposition

Breaking down project deliverables into smatter, more manageable components is

called decomposition. Breakdown should be done until the cost and schedule for the

work can be reliably estimated. The Level of detail for work packages will depend

on the size and complexity of the project.


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Expert judgment is often used to analyze the information needed to decompose the

project deliverables down into smaller component parts in order to create an

effective WBS. Such judgment and expertise is applied to technical details of the

project’s scope and used to reconcile differences in opinion on how to best break

down the overall scope of the project.

5.4.3. Create WBS – Outputs

5.4.3.1. Scope Baseline

Scope Baseline is a component of the project management plan which provides the

final list of all deliverables detailed in WBS and WBS dictionary. Any changes to scope

beyond this point can be done through formal change control process only.


Project documents that may get updated are requirements documentation, which

may need to be updated to include approved changes. If approved change requests

result from the Create WBS process, then the requirements documentation may need

to be updated to include approved changes.


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5.5. Validate Scope

Validate Scope is the process of verification of completed project scope and deliverables

by stakeholders. This includes performing review and getting formal acceptance of the

deliverable from stakeholder.

Validate Scope is different from Quality Control process as in scope validation concerned

with acceptance of the deliverables and work as per project scope while Quality control

process focuses on meeting the quality requirements specified for the deliverables. Usually

quality control is performed before scope verification, but sometimes these two processes

can be performed in parallel also.

Validate Scope


Project management plan

Requirements

documentation


matrix

Verified deliverables


Inspection

Group Decision Making

Techniques

Accepted deliverables

Change requests

Work Performance

Information

Project document

updates

5.5.1. Validate Scope – Inputs

5.5.1.1. Project management plan

Project management plan provides details of planned procedures from scope

management plan to be used for scope validation.


A description of how individual requirements meet the business need for the

project.

5.5.1.3. Requirements traceability matrix


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objectives.

5.5.1.4. Verified deliverables

Deliverables that are have passed through completed and result of executing quality

control process to determine correctness.







and cost etc.

5.5.2. Validate Scope – Tools and Techniques

5.5.2.1. Inspection

Inspection is a process of review which may include measuring, examining, and

verifying the deliverable against project scope statement to determine whether

work and deliverables meet requirements and product acceptance criteria.

5.5.2.2. Group Decision Making Techniques

Techniques to assess multiple alternatives that will be used to generate, classify,

and prioritize product requirements.

5.5.3. Validate Scope – Outputs

5.5.3.1. Accepted deliverables

Deliverables which are accepted after inspection and necessary documentation is

prepared. Rejected deliverables are also documented along with the reasons for

non-acceptance. Validate Scope process includes documentation received from the

customer or sponsor and acknowledging stakeholder’s acceptance of the project’s

deliverables.


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Changes may be requested during inspection & reviews in Validate Scope process.

These change requests are submitted for review and approval through the integrated

change control process.


Work performance data is analyzed in context and integrated based on the

relationship across areas and gets transformed into Work Performance Information

which provides a basis for decisions making associated with project.


Project documents that may be updated as a result of the Validate Scope process

include any documents that define the product or report status on product

completion.

5.6. Control Scope

Control Scope process controls the factors which induce changes in project scope. It also

controls the impact of those changes on project scope. Control Scope is associated with

Integrated Change Control process. This process makes sure that all requested changes and

recommended corrective actions are processed through the Integrated Change Control

process. This process also manages the actual changes when they occur in coordination with

other control processes. It controls scope creeps, which is one of the biggest reasons of

project failure.

Control Scope



Requirements

documentation


matrix

Variance analysis Work performance

information

Change requests

Project management

plan updates


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Work performance data

Organization process assets

Project document

updates


assets updates

5.6.1. Control Scope – Inputs


The following information from the project management plan is used to control

scope:


Scope Baseline

Change Management Plan

Configuration Management plan

Requirements Management Plan


A description of how individual requirements meet the business need for the project. 5.6.1.3. Requirements traceability matrix




objectives.

5.6.1.4. Work performance data






and cost etc.


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5.6.1.5. Organization process assets

The organizational process assets that can influence the Control Scope process are:

Existing formal and informal scope, control-related policies, procedures,

guidelines

Monitoring and reporting methods and templates to be used

5.6.2. Control Scope – Tools and Techniques

5.6.2.1. Variance analysis

Valiance analysis provides project performance measurements to assess the

variation of actual values against the planned values. It helps in determining the

quantifiable impact of change.

5.6.3. Control Scope – Outputs

5.6.3.1. Work performance information

Work performance data is analyzed in context and integrated based on the

relationship across areas and gets transformed into Work Performance Information

which provides a basis for decisions making associated with project.


Analysis of scope performance can result in a change request to the scope baseline

or other components of the project management plan. Change requests can include

preventive or corrective actions, defect repairs, or enhancement requests.

5.6.3.3. Project management plan updates

Project management plan updates may include updates to Scope Baseline and if the

approved change requests have an effect on the project besides the project scope,

then the corresponding cost baseline and schedule baselines are revised and reissued

to reflect the approved changes.


Project documents that may be updated are requirements documentation and

requirements traceability matrix.


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5.6.3.5. Organizational process assets updates

Organizational process assets that may be updated are:

Causes of variances

Corrective action chosen and the reasons

Other types of lessons learned from project scope control.


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Chapter 6: Project Time

Management


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6. Project Time Management

Project Time Management includes the processes required to ensure timely completion of the

project. - ThePMBOK® Guide – 5th Edition.

Knowledge

Area



Monitoring

and

Controlling

Closing

6 Project Time

Management

6.1 Plan Schedule Management

6.2 Define Activities

6.3 Sequence Activities

6.4 Estimate Activity Resources

6.5Estimate Activity Duration

6.6Develop Schedule


6.1. Plan Schedule Management

Plan Schedule Management is the process where the policies& procedures for planning&

managing the project schedule are documented. This process provides guidance and

direction on how the project schedule will be managed throughout the project.

Plan Schedule Management



Project Charter


Factors


Assets

Expert Judgment


Meetings

Schedule Management

Plan


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6.1.1. Plan Schedule Management – Inputs


It can be composed of one or more subsidiary plans and other components that will

be used to develop schedule management plan. These subsidiary plans include:

Resource Calendar

Cost Baseline

Milestone List

Quality Baseline

Risk Register


Described in 4.1.3.1. Project Charter provides inputs in developing schedule with

regards to key milestones that will have significant impact on the management of

project schedule.


Described in 4.1.1.4. Enterprise Environmental Factors provide inputs with regards

to organizational structure and culture that can impact the development and

management of project schedule.


Described in 4.1.1.5. Organizational Process Assets provides details of scheduling

tools that can be used, historical information and processes that will be used to

develop and manage project schedule.

6.1.2. Plan Schedule Management – Tools and Techniques


Access to the inputs require to develop the project charter is often provided by

Expert Judgment. Such judgment and expertise is applied to any technical and






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Consultants



Industry groups.


Analytical techniques are applied in project management to forecast potential

outcomes based on possible variations of project or environmental variables and

their relationships with other variables. Examples of analytical techniques used in

projects are:

Regression analysis

Grouping methods

Causal analysis,

Root cause analysis




Reserve analysis

Trend analysis


Variance analysis.

6.1.2.3. Meetings

While directing and managing project work, project manager, project team and

stakeholders may need to conduct meetings to discuss and address pertinent topics

of the project. Meetings are tend to be one of three types:

Information Exchange

Brainstorming, option evolution or design or

Decision making

6.1.3. Plan Schedule Management – Outputs

6.1.3.1. Schedule Management Plan

Schedule Management Plan sets the guidelines and defines the necessary steps to be

taken to develop, monitor and control the project schedule. Schedule management


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plan may consist scheduling methodology, tools, level of accuracy, units of measures

(e.g. Hours, days, weeks) etc.

6.2. Define Activities

Define Activities process identifies and documents the activities that needs to be performed

by decomposing the work packages (i.e. lowest level of WBS). These activities provides a

basis for estimating, scheduling, executing, and monitoring & controlling the project work.

Define Activities



Scope Baseline


Factors

Organizational Process Assets

Decomposition

Rolling Wave Planning

Expert Judgment

Activity List

Activity attributes

Milestone List

6.2.1. Define Activities – Inputs


The guidelines set in the Schedule Management Plan will be used as in input to define

the activities.


Scope Baseline provides the details of deliverables, constraints, and assumptions

which will need to be considered during activity definition process. It also provides

WBS as input for decomposing each work package to lower level activities.


Some of the enterprise environmental factors like Project management Information

System and Schedule tools can provide inputs in the process of

defining the activities.


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Organization process assets containing activity planning related policies, procedures

and guidelines are considered in developing the activity definitions. Lessons learned

knowledge base with historical information regarding activities, lists of previous

similar projects may be used when defining project schedule activities.

6.2.2. Define Activities – Tools and Techniques

6.2.2.1. Decomposition

Decomposition technique involves subdividing the project work packages into

smaller, more manageable components called activities. The Activity Definition

process defines the final outputs as activities and not the deliverables.

6.2.2.2. Rolling Wave Planning

Rolling wave planning is a technique of progressive elaboration planning where the

work to be accomplished in the near term is planned in detail at a low level of the

WBS, while work to be accomplished in the future is planned for WBS components

that are at a relatively high level of the WBS.

With this planning technique, schedule activities can exist at various levels of detail

in the project’s Life cycle. In early stage of planning, when information is less

defined, activities might be listed at the milestone level.


Experts with previous experience on similar projects in activity definition and

developing project schedules may provide their expertise in this process. Such

judgment and expertise is applied to any technical and management details during

this process.


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6.2.3. Define Activities – Outputs

6.2.3.1. Activity List

A comprehensive list including all activities that are required to be performed for

each work package in the project. This activity list includes the activity identifier

and a description of work for each schedule activity with sufficient detail to ensure

that project team understands what work is required to be completed. The activity

list is used in schedule network diagram as part of project management plan.

6.2.3.2. Activity attributes

Activity attributes for the activities may include:

Activity identifier

Activity codes

Activity description

Predecessor activities

Successor activities

Logical re1ationships

Leads and lags

Resource requirements

Imposed dates

Constraints

Assumptions

Person responsible for executing the work

These attributes provide inputs for further planning including schedule

development.

6.2.3.3. Milestone List

Milestone list contains all milestones along with the information that the particular

milestone is mandatory as contractual requirement or optional as per project

requirements or historical information. The milestone list is a part of the project

management plan and used for scheduling purpose.

6.3. Sequence Activities

This is the process of identifying and documenting the logical relationships among schedule

activities. This logical relationship represents inter-activity dependencies.


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Logically sequencing of activities can be represented by precedence relationships like Finish

to start, start to finish, start to start and finish to finish. Leads and lags are introduced for

preparing a realistic and achievable project schedule. Project management software

provides the facilities of defining and managing dependencies, led and lag while preparing

the project schedule.

Sequence Activities



Activity List

Activity attributes

Milestone List



Factors


assets

Precedence Diagramming

Method (PDM)

Dependency

determination

Leads and Lags

Project Schedule

network diagrams

Project document

updates

6.3.1. Sequence Activities – Inputs


Guidelines defined in the Schedule Management Plan will be used as the key input

in this process. Sequencing must be done following the scheduling methodology,

using the right tools defined in the Schedule management plan.








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Activity attributes for the activities may include:

Activity identifier

Activity codes





Leads and lags


Imposed dates

Constraints

Assumptions


These attributes provide inputs for further planning including schedule development.

6.3.1.4. Milestone List

Milestone list contains all milestones along with the information that the particular

milestone is mandatory as contractual requirement or optional as per project

requirements or historical information. The milestone list is a part of the project

management plan and used for scheduling purpose.


Project Scope Statement provides the details of major deliverables, constraints,

assumptions, high level timelines which will need to be considered during Sequence

Activities process.


Some of the enterprise environmental factors like Project management Information

System and Schedule tools can provide inputs in the process of

sequencing the activities.


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Organization process assets containing activity planning related policies, procedures

and guidelines are considered in developing the activity definitions. Lessons learned

knowledge base with historical information regarding activities, lists of previous

similar projects may be used when sequencing project activities.

6.3.2. Sequence Activities – Tools & Techniques

6.3.2.1. Precedence Diagramming Method (PDM)

Precedence Diagramming Method (POM) is a method of defining sequence of

activities and creating schedule network diagram. POM typically uses rectangle

boxes representing activities and arrows to represent their dependencies. These

boxes are called Nodes and this technique is called as activity on-node (AON).

PDM includes four types or dependency relationships:

Finish to Start: The start of the successor activity depends upon completion

of the predecessor activity.

Finish to Finish: The completion of the successor activity depends upon the

completion of the predecessor activity.

Start to Start: The start of the successor activity depends upon the start of

the predecessor activity.

Start to Finish: The completion of the successor activity depends upon the

start of the predecessor activity.

In PDM, finish to start is the most commonly used type of precedence relationship.

Start to finish relationship is rarely used.

6.3.2.2. Dependency determination

Three types of dependencies are used to define the sequence among the activities.

These are Mandatory, Discretionary and External. The project management team

determines that relationships between the activities are mandatory, discretionary

or external.

Mandatory dependencies: Mandatory dependencies are inherent in the nature

of the project work. These dependencies are often decided due to physical

limitations, such as in any construction project, it is mandatory to build


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foundation before erecting the structure. Mandatory dependencies are also

referred as hard logic.

Discretionary dependencies: Discretionary dependencies are usually defined

based on knowledge of best practices and standard procedures for the specific

application area. These relationships are called soft Logic, preferred logic or

preferential logic. These relationships are decided by project management

team based on previous experience on a similar successful project.

External dependencies: External dependencies involve a relationship

between project activities and non-project activities or external entitles. For

example, the testing activity in a project may dependent on delivery of

specific hardware from an external source. Historical data of similar previous

projects provides inputs for defining this dependency.

6.3.2.3. Leads and Lags

A lead allows an earlier start of the successor activity. This helps in fast tracking in

finish-to-start relationship wherein successor activity starts before the completion

of predecessor activity.

A lag creates a delay in the successor activity. In finish-to-start relationship, the

successor does not start immediately at completion of predecessor activity. Lag is

the delay period in starting the successor activity after completion of predecessor

activity.

6.3.3. Sequence Activities – Outputs

6.3.3.1. Project Schedule network diagrams

Project schedule network diagram is schematic display of the project’s schedule

activities with their dependencies.



Activity attributes,

Project logs (issues, assumptions, etc.), and

Risk register


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6.4. Estimate Activity Resources

Activity resource estimation process provides the estimation of ‘what type of and how many

resources’ are needed, and ‘when’ are they needed in the project. These resources include

persons, equipment, or material. The Activity Resource Estimating process is performed in

coordination with the Cost Estimating process as resource cost money.

Estimate Activity Resources


Schedule Management

Plan

Activity List

Activity attributes

Resource calendars

Risk Register

Activity Cost Estimates

Enterprise

environmental factors


assets Organizational

process assets

Expert Judgment

Alternative Analysis

Published estimating

data

Bottom-up estimating

Project management

software

Activity resource

requirements

Resource breakdown

structure

Project document updates

6.4.1. Estimate Activity Resources – Inputs



in this process. Sequencing must be done following the scheduling methodology,

using the right tools defined in the Schedule management plan.






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Activity attributes provide primary data for identifying and estimating the resources

required for each activity in the activity list. Activity attributes for the activities

may include:

Activity identifier

Activity codes





Leads and lags


Imposed dates

Constraints

Assumptions


6.4.1.4. Resource calendars

Availability of people, equipment, and material, their location and available

quantities are considered during the process of activity resource estimation.

6.4.1.5. Risk Register

Risk events may impact resource selection and availability. Updates to the risk

register are included with project documents updates.

6.4.1.6. Activity Cost Estimates

The Activity Resource Estimating process is performed in coordination with the Cost

Estimating process as resource cost money and their cost may impact resource

selection and availability.


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Some of the enterprise environmental factors like resource location, skills and

availability can provide inputs in the process of estimating the resource

requirements.


Organization process assets containing resource estimation related policies,

procedures and guidelines, rental or purchase of equipment or materials are

considered in estimating the activity resources. Lessons learned knowledge base

with historical information may be used when estimating resources.

6.4.2. Estimate Activity Resources – Tools and Techniques


Experts with specialized knowledge in resource planning and estimating can help

inactivity resource estimating process.

6.4.2.2. Alternative Analysis

Alternative methods of performing the activity are analyzed during activity resource

estimating process. These alternatives may be different levels of resource’s

capability or skills, different size & types of machines, different tools, etc. Make or

buy decisions are also considered regarding the resource.

6.4.2.3. Published estimating data

Some organizations publish data on production rates and costs of resources for

various human resources, material, and equipment for different locations. This helps

in activity resource estimating process.

6.4.2.4. Bottom-up estimating

Bottom-up estimating is used, when a schedule activity cannot be estimated with a

reasonable degree of confidence. The work within the activity is decomposed into

more details and estimation is performed at lowest Level.

6.4.2.5. Project management software

Project management software provides an efficient process of planning organizing

and managing resource pools and developing resource estimates, resource


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breakdown structures, resource availability, resource calendar and resource rates

can be defined in project management software.

6.4.3. Estimate Activity Resources – Outputs

6.4.3.1. Activity resource requirements

Identification and description of the resource types and number of resources

required for each activity in a work package is the primary output of activity

resource estimation process. Estimated resource requirement of each work package

can be determined by aggregation of activity level estimates.

The basis of estimate for each resource the assumption used for estimation, resource

availability and their quantity are included in activity resource estimation

document.

6.4.3.2. Resource breakdown structure

A hierarchical structure by resource category and resource type is created for allthe

resources identified during estimation process. This is called resource

breakdown structure (RBS).





Risk register

Activity cost Estimates

Resource Calendars

6.5. Estimate Activity Durations

The Estimating Activity Duration process uses information like scope of work, required

resource types, number of resources, resource calendars and resource availabilities for

determining work periods needed for each activity. These estimates are progressively

elaborated. Estimate Activity Duration process does:

Estimation of the amount of work effort required to complete the scheduled activity

Estimation of the assumed amount of resources to be used to complete the scheduled

activity


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Determining the number of work periods needed to complete the scheduled activity

Documentation of all data & assumptions that support duration estimation for each

activity

Estimate Activity Durations



Activity List

Activity attributes

Activity resource

requirements

Resource calendars


Risk Register

Resource Breakdown

Structure

Enterprise environmental

factors


assets

Expert Judgment

Analogous estimating

Parametric estimating

Three-point estimates

Group Decision making

Techniques

Reserve Analysis

Activity duration estimates


6.5.1. Estimate Activity Durations – Inputs



in this process. Duration estimation must be done following the methodology, using

the right tools defined in the Schedule management plan.





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that project team understands what work is required to be completed.


Activity attributes provide primary data for estimating the duration for each activity

in the activity list. Activity attributes for the activities may include:

Activity identifier

Activity codes





Leads and lags


Imposed dates

Constraints

Assumptions



Description of the resource types and number of resources required for each activity

in a work package is the primary input for activity duration estimation process since

the assigned resources and resource availability will significantly influence the

duration of activities. For example, if an activity requires two resources working

together to complete the activity, but only one person is available; the activity will

require more time to complete. If resources are added with lower skills, efficiency

will go down and work will take more time.


Availability of people, equipment, and material, their location and availability will

have a major impact on the activity duration.

6.5.1.6. Project Scope Statement

The constraints and assumptions from the project scope statement provide inputs

for estimating the activity durations.


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Risk events may impact resource selection and availability. Updates to the risk

register are included with project documents updates

6.5.1.8. Resource Breakdown Structure

A hierarchical structure by resource category and resource type will provide inputs

related to how many resources under different categories, of different types are

needed to complete the project.


Some of the enterprise environmental factors like resource location, skills and

availability can provide inputs in the process of estimating the activity duration.


Organization process assets containing resource estimation related policies,

procedures and guidelines, rental or purchase of equipment or materials are

considered in estimating the activity resources. Lessons learned knowledge base

with historical information may be used when estimating resources.

6.5.2. Estimate Activity Durations – Tools and Techniques


Experts with specialized knowledge of estimation process and experience in similar

projects may be used for activity duration estimate. Project team members with

prior experience with similar projects may also provide duration estimate

information or recommended maximum activity durations.

6.5.2.2. Analogous estimating

Analogous duration estimating technique uses the actual durations of a previous

similar activity as the basis for estimating the duration of a future activity. This is

typically used when available information about the project is very limited to

provide detailed estimates. In the early phases of a project, analogous estimating

technique is used with historical Information and expert judgment.

Reliability of analogous duration estimates is highest when the previous project

activities are similar ‘in fact’ and not just ‘in appearance’


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6.5.2.3. Parametric estimating

Parametric Estimation is a technique in which durations can be determined by

multiplying the ‘quantity of work to be performed by the productivity rate or

duration per unit, of quantity’. For example, If one box can be assembled in 2 hour,

100 boxes will take 200 (2x100) hours.

6.5.2.4. Three-point estimates

Three point estimates are based on determining three types of estimates:

Most likely: This uses ‘most likely’ scenario of resource availability,

productivity, dependencies, and interruptions.

Optimistic: This uses an ‘optimistic’ (best case) scenario of all the factors

considered in ‘most likely’ estimates.

Pessimistic: This uses a ‘pessimistic’ (worst case) scenario of all the factors


An activity duration estimate can be determined by using an average of the three

estimated durations, i.e. optimistic, pessimistic and most likely. That average will

often provide a more accurate duration estimate than the single point (most likely)

estimate.

6.5.2.5. Group Decision making Techniques

This is a very common technique where instead of an individual, a group of people

who have expertise in the work to be carried out, are engaged through

brainstorming, Delphi or nominal group techniques to improve the accuracy of

estimates.

6.5.2.6. Reserve Analysis

All identified risks and their impact is considered while estimating the duration.

Some additional time is added to project duration estimates, which is known as

contingency reserve, time reserve or buffer. The contingency reserve can be a

percentage of the estimated duration, a fixed number of work periods, or developed

by quantitative risk analysis. As estimation process proceeds and team gets more

detailed information, the contingency reserve can be used completely or partially,

or can later be reduced or eliminated.


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6.5.3. Estimate Activity Durations – Outputs

6.5.3.1. Activity duration estimates

Activity duration estimates are the primary outputs of this process which provides

the likely number of work periods that will be required to complete a scheduled

activity. In some situations duration estimates can be represented in a range like 20

days +/- 3 days (17 days – 23 days).





6.6. Develop Schedule

Develop Schedule is the process of determining planned start and finish dates for project

activities. Schedule development is an iterative process which requires review & refinement

based on duration and resource estimates. An approved project schedule becomes baseline

against which project progress is monitored.

Develop Schedule process continues throughout the project as re-planning may be needed

due to change requests, or risk situation or upon identification of new risks.

Develop Schedule



Activity List

Activity attributes

Project schedule network

diagrams

Activity resource

requirements

Resource calendars


Schedule network

analysis

Critical Path Method

(CPM)

Critical Chain Method

Resource Optimization

Techniques

Modeling Techniques

Leads and Lags

Schedule baseline

Project Schedule

Schedule data

Project Calendars

Project management Plan

Update

Project documents updates


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Risk Register

Project Staff Assignment

Resource breakdown

Structure


factors


assets

Schedule compression

Scheduling Tool

6.6.1. Develop Schedule – Inputs



in this process. Duration estimation must be done following the methodology, using

the right tools defined in the Schedule management plan.



each work package in the project are used as a key input in this process as for each

activity in the list, schedule date will be identified in this process.


Activity attributes provide additional data for developing the schedule for each

activity in the activity list. Activity attributes for the activities may include:

Activity identifier

Activity codes





Leads and lags


Imposed dates


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Constraints

Assumptions


6.6.1.4. Project schedule network diagrams

Project schedule network diagram represents activity dependencies in the project.


Activity resource requirement and their availability are used as an input as they may

have a significant impact on overall schedule.


Resource calendar is used along with project calendar. The resource calendar

provides Information on working days or shifts with working and non-working time

or the resources.


Activity duration estimates provide the likely number of work periods that will be

required to complete a schedule activity.


The project scope statement contains assumptions and constraints that provide

inputs while developing schedule. Constraints of imposed dates on activity starts or

finishes restrict the start or finish to occur either no earlier than a specified date or

no later than a specified date. Other commonly used constraints are the “Start No

Earlier Than” and the “Finish No Later Than”. Major milestones listed in scope

statement provide input to schedule development process.


Risk events may impact project schedule. Due to certain risks, the team may decide

to carry out certain activities at a different date or time. Updates to the risk register

are included with project documents updates.


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6.6.1.10. Project Staff Assignment

The project staff assignments specify which resources are assigned to each activity.

6.6.1.11. Resource Breakdown Structure

A hierarchical structure by resource category and resource type will provide inputs

related to how many resources under different categories, of different types are

needed to complete the project. This is used in sync with the resource calendars

explained earlier.

6.6.1.12. Enterprise environmental factors

Some of the enterprise environmental factors like standards, communication

channels and scheduling tools can provide inputs in the process of developing

schedule.


The organizational process assets such as project calendars are used in developing

schedule. The project calendar of working days or shifts with working and non-

working time is used for preparing the schedule.

6.6.2. Develop Schedule – Tools and Techniques

6.6.2.1. Schedule network analysis

Project schedule network diagram is schematic display of the project’s activities

with their dependencies. Schedule network analysis generates the project schedule

by using techniques like Critical Path method, Critical Chain method, What If analysis

and Resource Leveling.

This process calculates the early start, early finish, late start and late finish dates

in the project schedule. This analysis also provides scheduled start and finish dates

for the uncompleted project activities.

6.6.2.2. Critical Path Method (CPM)

The critical path method is a schedule network analysis technique which calculates

the theoretical early start and finishes dates, and late start and finish dates, for all

activities without considering any resource limitations or constraints. The process of

identifying critical path includes:

Forward pass analysis to calculate early start and early finish dates


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Backward pass analysts to calculate late start and late finish dates

Analysis of float to identify critical path

Calculated early start and finish dates, and late start and finish dates may or may

not be the same on any network path since total float, may be positive, negative,

or zero.

6.6.2.3. Critical Chain Method

The critical chain method (CCM) is a schedule method that allows the project team

to place buffers on any project schedule path to account for limited resources and

project uncertainties. It is developed from the critical path method approach and

considers the effects of resource allocation, resource optimization, resource

leveling, and activity duration uncertainty on the critical path determined using the

critical path method.

6.6.2.4. Resource Optimization Techniques

Resource Optimization is a schedule network analysis technique to address the

situation where shared or critical resources are available at certain times or in

limited quantities. Resource usage is optimized using resource leveling that is

performed after identlft1ng the critical path and it may force changes in critical

path due to constraints on availability of critical resources.

6.6.2.5. Modeling Techniques

Schedule modeling technique provides a representation of data and related

information for the project. It helps identifying various factors which may have

significant influence on the project schedule such as how delay in a major

component delivery can impact specific activity durations or schedule.


The leads or Lags are adjusted during schedule network analysis to develop a viable

project schedule.







activity.


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6.6.2.7. Schedule compression

Schedule compression is a technique to shorten the project schedule to meet

schedule constraints, imposed dates, or other schedule objectives without

compromising on the project scope. Schedule compression can be done by using two

following techniques:

1) Crashing: Schedule crashing is performed by adding more resources in order

to complete the activity earlier. Assigning more resources may results in more

cost. The cost and schedule tradeoffs are analyzed to determine how to

obtain the greatest amount of compression for the least increase in cost.

Crashing may not always produce a viable alternative and can result in

increased cost.

2) Fast Tracking: Fast tracking is performed by parallel execution of phases or

activities that are normally done in sequence. The parallel execution of

activity results in increased risk of achieving the shortened project schedule

as incomplete predecessor may force some rework on successor activity.

6.6.2.8. Scheduling Tool

Project Management tools such as MS Project can be used to develop the project

schedule.

6.6.3. Develop Schedule – Outputs

6.6.3.1. Schedule baseline

A schedule baseline is a specific version of the project schedule which is accepted

and approved by the project management team as the schedule that can be changed

only following through change control process. Baseline start and baseline finish

dates are compared with actual dates to determine if the project is on schedule or

there is any variance.

6.6.3.2. Project Schedule

The project schedule is primary output of schedule development process. It includes

planned start & finish dates, durations, milestones, and resources for overall project

and planned start & finish dates for each activity. The project schedule in summary

form is known as the master schedule or milestone schedule. A project schedule can

be presented in tabular form as well as graphically using following formats:

1) Project schedule network diagrams: These diagrams show the schedule activity

dates, project network logic and the critical path. The activity-on-node diagram


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or a time scaled schedule network diagram is used for representing network

diagram.

2) Bar Charts: These charts contain bars representing activities, show activity start

and end dates, as well as expected durations. At broader level, more

comprehensive summary activity, also called as hammock activity, is used

between milestones or across multiple interdependent work packages.

3) Milestone Charts: These charts contain bar representing the scheduled start or

completion of major deliverables and key external interfaces.

6.6.3.3. Schedule data

This is supporting data for the project schedule. This may include schedule

alternative schedule, best-case or worst-case scenario, resource histograms showing

resource requirements at time periods etc.

6.6.3.4. Project Calendars

A project calendar may be updated to document the working days and shifts when

the scheduled activities will be carried out.

6.6.3.5. Project management Plan Update

Since this process can be followed multiple times in the project, an update to project

schedule baseline and schedule management plan may get updated if needed.

6.6.3.6. Project documents updates


Activity resource requirements

Activity attributes

Calendars

Risk registers

6.7. Control Schedule

Control Schedule process is a part of the Monitor & Control process group. This process helps

determining the current status of the project schedule, influencing the factors, by taking

corrective or preventive actions, that causes deviations from project schedule and also

determining that the project schedule has changed. The actual project progress is updated

and changes to the schedule baseline are managed in this process to ensure timely

completion of the project activities and project.


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Control Schedule



Project schedule

Work performance Data

Project Calendars

Schedule Data


assets

Performance reviews

Project management

software

Resource Optimization

Techniques

Modeling Techniques

Leads and Lags

Schedule compression

Scheduling tool

Work performance

Information

Schedule Forecast

Change requests


updates

Project documents updates


assets updates

6.7.1. Control Schedule – Inputs



can be either summary level or detailed. The key information referred to in this

process is schedule management plan and schedule baseline that provides

information around how the schedule will be managed and project actuals will be

compared to what to identify if any deviations have happened.

6.7.1.2. Project schedule

The project schedule is primary output of schedule development process. It includes

planned start & finish dates, durations, milestones, and resources for overall project

and planned start & finish dates for each activity. The project schedule in summary

form is known as the master schedule or milestone schedule. A project schedule can

be presented in tabular form as well as graphically using following formats:

1) Project schedule network diagrams: These diagrams show the schedule

activity dates, project network logic and the critical path. The activity-on-

node diagram or a time scaled schedule network diagram is used for

representing network diagram.

2) Bar Charts: These charts contain bars representing activities, show activity

start and end dates, as well as expected durations. At broader level, more


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comprehensive summary activity, also called as hammock activity, is used

between milestones or across multiple interdependent work packages.

3) Milestone Charts: These charts contain bar representing the scheduled start

or completion of major deliverables and key external interfaces.

6.7.1.3. Work performance Data






and cost etc.

6.7.1.4. Project Calendars

A project calendar may be required for some activities to calculate the schedule

forecast.

6.7.1.5. Schedule Data

Supporting data for the project schedule that includes alternative schedule, best-

case or worst-case scenario, resource histograms showing resource requirements at

time periods etc. may get updated in this process.


Policies procedures and guidelines that can influence the Control Schedule process

are referred to and when needed in this process.

6.7.2. Control Schedule – Tools and Techniques

6.7.2.1. Performance reviews

Performance review techniques provide schedule performance information such as

comparison of actual and planned dates, percent complete and duration needed to

complete the remaining work. Various techniques like trend analysis, critical path

analysis, critical chain analysis and Earned Value management are used to review

the performance of the project.

Earned value management is the key technique used in performance review.

Schedule performance measurements such as schedule variance (SV) and schedule

performance index (SPI), are used to assess the magnitude of variation to the original

schedule baseline. The total float and early finish variances are also essential


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planning components to evaluate project time performance. Important aspects of

schedule control include determining the cause and degree of variance relative to

the schedule baseline, estimating the implications of those variances for future work

to completion, and deciding whether corrective or preventive action is required.

6.7.2.2. Project management software

Project Management tools such as MS Project can be used to compare actual dates

with planned dates and to forecast the effect of changes or deviations to project

schedule.

6.7.2.3. Resource Optimization Techniques

Resource Optimization is a schedule network analysis technique to address the

situation where shared or critical resources are available at certain times or in

limited quantities. Resource usage is optimized using resource leveling that is

performed after identlft1ng the critical path and it may force changes in critical

path due to constraints on availability of critical resources.

6.7.2.4. Modeling Techniques

Schedule modeling technique provides a representation of data and related

information for the project. It helps identifying various factors which may have

significant influence on the project schedule such as how delay in a major

component delivery can impact specific activity durations or schedule.


The leads or Lags are adjusted during schedule network analysis to develop a viable

project schedule.







activity.

6.7.2.6. Schedule compression

Schedule compression is a technique to shorten the project schedule to meet

schedule constraints, imposed dates, or other schedule objectives without

compromising on the project scope. Schedule compression can be done by using two

following techniques:


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1) Crashing: Schedule crashing is performed by adding more resources in order to

complete the activity earlier. Assigning more resources may results in more

cost. The cost and schedule tradeoffs are analyzed to determine how to obtain

the greatest amount of compression for the least increase in cost. Crashing

may not always produce a viable alternative and can result in increased cost.

2) Fast Tracking: Fast tracking is performed by parallel execution of phases or

activities that are normally done in sequence. The parallel execution of

activity results in increased risk of achieving the shortened project schedule

as incomplete predecessor may force some rework on successor activity.

6.7.2.7. Scheduling Tool

Project Management tools such as MS Project can be used to develop the project

schedule.

6.7.3. Control Schedule – Outputs

6.7.3.1. Work performance Information

Work performance Information is provided by calculating schedule variance (SV) and

Schedule Performance Index (SPI) values for WBS components, in particular the work

packages. This information is documented and communicated to stakeholders as per

project reporting requirements.

6.7.3.2. Schedule Forecast


Request to make changes to the project schedule baseline may be created due to

variance in schedule or modification to the project schedule model. Project schedule

changes may or may not require changes to other components of the project

management plan. Requested changes are processed for review and implemented

through the Integrated Change Control process.


Some elements of the project management plan may require update are Schedule

Baseline, Schedule Management Plan and Cost Baseline to reflect any approved

changes resulting from Control Schedule process.


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6.7.3.5. Project documents updates


Project Schedule

Schedule Data

Risk registers


Organizational process assets that may be updated include, but are not limited to:

Causes of variances

Corrective action chosen and the reasons

Other types of lessons learned from project schedule control.


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Chapter 7: Project Cost

Management


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7. Project Cost Management

Project Cost Management includes the processes involved in planning, estimating, budgeting,

financing, funding, managing, and controlling costs so that the project can be completed within

the approved budget.

- ThePMBOK® Guide – 5th Edition.

Knowledge

Area



Monitoring

and

Controlling

Closing

7 Project Cost

Management

7.1 Plan Cost Management

7.2 Estimate Cost

7.3 Determine Budget


7.1. Plan Cost Management

Plan Cost Management is the process that establishes the policies, procedures, and

documentation for planning, managing, expending, and controlling project costs. It provides

guidance and direction on how the project costs will be managed throughout the project.

Plan Cost Management



Project Charter


Factors


Expert Judgment


Meetings



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7.1.1. Plan Cost Management – Inputs


It can be composed of one or more subsidiary plans that will provide information to

develop the cost management plan. These subsidiary plans may contain the

following components:

Scope baseline

Schedule Baseline

Quality Baseline

Risk Register


Described in 4.1.3.1. Project Charter provides inputs in developing cost management

plan with regards to high level budget information or boundaries around which the

cost management plan will be developed.


The enterprise environmental factors is used to identify the factors that influence

the Plan Cost Management process. Factors such as organizational culture and

structure, market conditions, currency exchange rates for project costs sourced

from more than one country, published commercial information such as resource

cost rate information and project management information system, which provides

alternative possibilities for managing cost.


Organizational process assets provides a list of cost estimating and budgeting-related

policies, procedures, and guidelines, financial controls procedures, Historical

information and lessons learned knowledge bases that is used as a key input in

developing the Cost Management plan.

7.1.2. Plan Cost Management – Tools and Techniques


Access to the inputs require to develop the cost management plan is often provided

by Expert Judgment. Such judgment and expertise is applied to any technical and






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Consultants



Industry groups.


Analytical techniques are applied in project management to choose strategic options

related to project funding. Examples of analytical techniques used in projects are:

Regression analysis

Grouping methods

Causal analysis,

Root cause analysis




Reserve analysis

Trend analysis


Variance analysis.

7.1.2.3. Meetings

While developing the cost management plan, project manager, project team and

stakeholders may need to conduct meetings to discuss cost management plan.

7.1.3. Plan Cost Management – Outputs

7.1.3.1. Cost Management Plan

Cost Management Plan sets the guidelines and defines the necessary steps to be

taken to develop, monitor and control the project budget. Cost management plan

may consist methodology, tools, level of accuracy, currency etc.

7.2. Estimate Cost

Approximate cost estimates are developed for all activities after consideration of risks and

all causes of possible cost variation. This quantitative assessment process generates an

elaborated Activity Cost Estimate. Various alternative estimates are identified and

considered. All additional costs are checked for justification in additional savings in the life


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cycle process. For example, in most application areas, additional work during a design phase

is widely held to have the potential for reducing the cost of the execution phase and product

operations. To facilitate comparison between projects and for cost control/management

purposes, cost estimates are generally expressed in units of currency or estimate units such

as staff hours or staff days are used along with currency.

Cost estimates are refined and adjusted during the project lifecycle to reflect additional

details available. Wherever required, guidelines are generated for when such refinements

are made and for what degree of accuracy is expected.

Resource’s for which costs are estimated Include infrastructure, tabor, materials,

equipment etc. and special categories like inflation, contingency etc. If the performing

organization does not have formally trained project cost estimators, then the project team

will need to supply both the resources and the expertise to perform project cost estimating

activities.

Estimate Cost



Human Resource Management

Plan

Scope Baseline

Project Schedule

Risk Register


Factors


Expert Judgment

Analogous Estimating

Parametric Estimating

Bottom-up Estimating

Three Point Estimate

Reserve Analysis

Cost of Quality

Project Management

Software

Vendor Bid Analysis

Group Decision Making

Techniques


Basis of Estimate

Project Document

Updates


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7.2.1. Estimate Cost – Inputs


The cost management plan defines how project costs will be managed and controlled. It

includes the method used and the level of accuracy required to estimate activity cost.

7.2.1.2. Human Resource Management Plan

HR Management plan provides staffing attributes and personnel rates that are

necessary components for developing the cost estimates.


Scope baseline is comprised of project scope statement, WBS and WBS dictionary.

The constraints like project budget, delivery dates, availability of human and

material resources, assumptions limiting factors etc. are derived from the Project

scope statement. Relationship and dependencies between all project components as

described in WBS is used for building effective and accurate cost estimates. WBS

dictionary provides clarity among deliverables to facilitate accurate estimation.


Project Schedule includes activity resource and duration estimations, provides the

most important inputs for cost estimation - quality, quantity and availability of

human and material resources. All costs including charges, interest rates,

agreements, cost variations, overhead costs are derived out of the Project Schedule.


All risks are considered in developing alternative cost estimates. Risks, either threats

or opportunities are studied and expected variations are planned for.


The Cost Estimating process Considers Marketplace conditions: Market costs, terms

and conditions of project resources. It can also use Commercial databases that help

track/compare quantity of human and other resources at different skill/attribute

levels at their respective costs.


Existing internal procedures, policies and guidelines are used for estimating the cost.

It also provides templates for cost estimation, historical information and lesson

learned from previous projects.


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7.2.2. Estimate Cost – Tools and Techniques


Experts with specialized knowledge of estimation process and experience in similar

projects may be used for activity cost estimate. Project team members with prior

experience with similar projects may also provide cost estimation information.

7.2.2.2. Analogous estimating

Analogous cost estimating technique uses the actual cost of a previous similar

activity as the basis for estimating the cost of a future activity. This is typically used

when available information about the project is very limited to provide detailed

estimates. In the early phases of a project, analogous estimating technique is used

with historical Information and expert judgment.

7.2.2.3. Parametric estimating

Parametric Estimation is a technique in which cost can be determined by multiplying

the ‘quantity of work to be performed by the resource rate or cost per unit, of

quantity’. For example, If one square foot of area can be constructed in USD 10, 100

Square feet will take 1000 (10x100) USD.

7.2.2.4. Bottom-up Estimating

Individual activities are estimated for the smallest detail. All costs are then

aggregated and used for reporting, tracking and control purposes. In this method,

the individual activity cost consciousness is of prime importance.

7.2.2.5. Three-point estimates

Three point estimates are based on determining three types of estimates:

Most likely: This uses ‘most likely’ scenario of resource availability,

productivity, dependencies, and interruptions.

Optimistic: This uses an ‘optimistic’ (best case) scenario of all the factors


Pessimistic: This uses a ‘pessimistic’ (worst case) scenario of all the factors



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An activity cost estimate can be determined by using an average of the three

estimated cost, i.e. optimistic, pessimistic and most likely. That average will often

provide a more accurate cost estimate than the single point (most likely) estimate.


All identified risks and their impact is considered while estimating the cost. Some

additional cost is added to project cost estimates, which is known as contingency

reserve, cost reserve or buffer. The contingency reserve can be a percentage of the

estimated cost, a fixed cost, or developed by quantitative risk analysis. As

estimation process proceeds and team gets more detailed information, the

contingency reserve can be used completely or partially, or can later be reduced or

eliminated.

7.2.2.7. Cost of Quality

Cost of Quality can be used to prepare the activity cost estimate.

7.2.2.8. Project Management Software

Widely available cost estimation application or any project management software

can be used to for faster and more accurate estimation of cost.

7.2.2.9. Vendor Bid Analysis

Vendor bid analysis is another technique to benchmark costs. If a project is awarded

to a vendor in a competitive bid, more detailed analysis may be considered for cost

estimation and control purposes.

7.2.2.10. Group Decision making Techniques

This is a very common technique where instead of an individual, a group of people

who have expertise in the work to be carried out, are engaged through

brainstorming, Delphi or nominal group techniques to improve the accuracy of

estimates.

7.2.3. Estimate Cost – Outputs


An activity cost estimate is a quantitative assessment of the likely costs of the

resources required to complete activities. This type of estimate can be presented in

summary form or in detail. Costs are estimated for all resources, human and material

and may consider inflation, contingency reserves etc.


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7.2.3.2. Basis of Estimate

Details validating the derivation of the cost estimates are provided. Supporting

details for justification of cost estimate can include description of activity’s scope

of work, documentation of how it was estimated, what tools were used and what

assumptions & constraints have been considered.


Project documents that may be updated include, but are not limited to, the risk

register.

7.3. Determine Budget

Determine budget involves aggregating the estimated cost of individual activities or work

packages to establish a total cost baseline for measuring project performance. The project

scope statement may provide the summary budget. However, activity or work package cost

estimates are prepared prior to the detailed budget requests and work authorization.

Determine Budget



Scope Baseline


Basis of Estimate

Project Schedule

Resource Calendars

Risk Registers

Agreements


Cost Aggregation

Reserve Analysis

Expert Judgment

Historical Relationship

Funding Limit

Reconciliation

Cost Performance

Baseline

Project Funding

Requirements

Project Document

Updates


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7.3.1. Determine Budget – Inputs


The cost management plan defines how project costs will be managed and

controlled. It includes the method used and the level of accuracy required to

estimate activity cost.


Scope baseline is comprised of project scope statement, WBS and WBS dictionary.

The constraints like project budget, delivery dates, availability of human and

material resources, assumptions limiting factors etc. are derived from the Project

scope statement. Relationship and dependencies between all project components as

described in WBS is used for building effective and accurate cost estimates. WBS

dictionary provides clarity among deliverables to facilitate accurate estimation.



resources required to complete activities. This type of estimate can be presented in

summary form or in detail. Costs are estimated for all resources, human and material

and may consider inflation, contingency reserves etc.

7.3.1.4. Basis of Estimate

Details validating the derivation of the cost estimates are provided. Supporting

details for justification of cost estimate can include description of activity’s scope

of work, documentation of how it was estimated, what tools were used and what

assumptions & constraints have been considered.


Project Schedule includes activity resource and duration estimations, provides the

inputs for determining budget - quality, quantity and availability of human and

material resources. All costs including charges, interest rates, agreements, cost

variations, overhead costs are derived out of the Project Schedule.

7.3.1.6. Resource Calendars

Availability of people, equipment, and material, their location and available

quantities are considered during the process of determining project budget.


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7.3.1.7. Risk Registers

Risk events may impact project budget. All risks are considered in developing

alternative cost estimates and the cost of response should be aggregated to make a

part of the project budget.

7.3.1.8. Agreements

Agreements with external vendors regarding what product, service or results have

been purchased – and their costs are used in developing the budget.


The organizational process assets that influence the Determine Budget process

include existing formal and informal cost budgeting-related policies, procedures,

and guidelines, Cost budgeting tools and Reporting methods.

7.3.2. Determine Budget – Tools and Techniques

7.3.2.1. Cost Aggregation

Activity cost estimates are aggregated and grouped by work packages which may be

then grouped by higher Ievels (Control Accounts) then finally by entire the entire

project.


Reserve or management contingency allowance are used to deal with uncertainty or

“known unknowns”. The reserve is added to project budget but not distributed to

project team as budget.


Experts with specialized knowledge of budgeting process and experience in similar

projects may be used for determining the project budget. Project team members

with prior experience with similar projects may also provide information while

determining the budget.

7.3.2.4. Historical Relationship

Any historical relationships that result in parametric estimates or analogous

estimates involve the use of project characteristics (parameters) to develop

mathematical models to predict total project costs.


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7.3.2.5. Funding Limit Reconciliation

Funds are reconciled and based on the results, new limits are set and WBS

components etc. are adjusted. This may impact allocation of resources to the

project. If costs are used in the schedule development process, the process is

repeated with new constraints and a new cost baseline is derived.

7.3.3. Determine Budget – Outputs

7.3.3.1. Cost Performance Baseline

The cost baseline is a time phased budget that is used as a basis against which overall

cost performance on the project is measured, monitored, and controlled. Many

projects, especially large ones, have multiple cost or resource baselines to measure

different aspects of project performance.

7.3.3.2. Project Funding Requirements

Funding requirements are derived from the cost baseline and can be established to

exceed to allow for either early progress or cost overrun. Funding usually occurs in

incremental. The total funds required are those included in the cost baseline plus

the management contingency reserve amount. The cost baseline and cash flow Lines

would increase when a portion of the management reserve is authorized and when

it is spent.


Project documents that may be updated include risk register, activity cost estimates

and project schedule.

7.4. Control Costs

Project cost control Includes:

Influencing the factors that create changes to the cost baseline

Ensuring requested changes are agreed upon

Managing the actual changes when and as they occur

Assuring that potential cost overruns do not exceed the authorized funding

periodically and in total for the project

Monitoring cost performance to detect and understand variances from the cost

baseline

Recording all appropriate changes accurately against the cost baseline


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Preventing incorrect, inappropriate, or unapproved changes from being included in

the reported cost or resource usage

Informing appropriate stakeholders of approved changes

Acting to bring expected cost overruns within acceptable limits.

Control Costs


Project Management

Plan

Project Funding

Requirements



Assets

Earned Value

Management

Forecasting

To-Complete

Performance Index (TCPI)

Performance Reviews

Project Management

Software

Reserve Analysis

Work Performance

Information

Cost Forecasts

Change Requests

Project Management

Plan Updates

Project Document

Updates


Assets Updates

7.4.1. Control Costs – Inputs


The project management plan contains cost baseline that will be compared with

actual results to determine if a change, corrective action, or preventive action is

necessary and also cost management plan to describe how the project costs will be

managed and controlled.

7.4.1.2. Project Funding Requirements

The project funding requirements include projected expenditures plus anticipated

liabilities. Funding requirements are derived from the cost baseline and can be

established to exceed to allow for either early progress or cost overrun.






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each process area for detailed analysis. Work Performance Data includes costs that

have been authorized and incurred.


Existing formal and informal cost control-related policies, procedures, and

guidelines, Cost control tools and Monitoring and reporting methods provide the key

inputs in Control Cost process.

7.4.2. Control Costs – Tools and Techniques

7.4.2.1. Earned Value Management

Earned value management combines scope, schedule, and resource measurements

to assess project performance and progress. It compares the cumulative value of

scope, time and cost baseline to form the performance baseline to assess and

measure project performance and progress. The earned value technique involves

developing these key values to each activity, work package or control account:

Planned value (PV): The authorized budget assigned to scheduled work.

Earned value (EV): The measure of work performed expressed in terms of the

budget authorized for that work.

Actual cost (AC): The realized cost incurred for the work performed on an

activity during a specific time period.

Cost variance (CV): CV is EV – AC. The cost variance at the end of the project

will be the difference between the budget at Completion (BAC) and the actual

amount spent.

Schedule variance (SV): SV is EV - PV. Schedule variance will ultimately equal

zero when the project is completed because all of the planned values will have

been earned.

Schedule performance Index (SPI): SPI is EV/PV. The SPI is used in addition to

the schedule status, to predict the completion date and is sometimes used in

conjunction with the CPI to forecast the project completion estimates. SPI

equals the ratio of the EV to the PV.

Cost performance Index (CPI): CPI is EV/AC. CPI value Less than 1.0 indicates

a cost overrun of the estimates. A CPI value greater than 1.0 indicates a cost

under-run of the estimates. CPI equals the ratio of the EV to the AC. The CPI is

the most commonly used cost-efficiency indicator.


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7.4.2.2. Forecasting

Forecasting includes making estimates or predictions of conditions In the project’s

future based on information and knowledge available at the time of the forecast. As

the project progresses, the forecasts are adjusted.

The earned value technique parameters of BAC, actual cost (AC) to date, and the

cumulative CPI efficiency indicator are used to calculate ETC and EAC where BAC Is

equal to the total PV at completion for a schedule activity, work package, control

account, or other W8S component.

7.4.2.3. To-Complete Performance Index (TCPI)

The to-complete performance index (TCPI) is a measure of the cost performance

that is required to be achieved with the remaining resources in order to meet a

specified management goal, expressed as the ratio of the cost to finish the

outstanding work to the remaining budget. TCPI is the calculated cost performance

index that is achieved on the remaining work to meet a specified management goal,

such as the BAC or the EAC.

7.4.2.4. Performance Reviews

Performance reviews compare cost performance over time, schedule activities or

work packages overrunning and underrunning the budget, and estimated funds

needed to complete work in progress. Under EVM, Variance Analysis, Trend Analysis

and Earned value Performance is calculated to check how the project is performing.

7.4.2.5. Project Management Software

Project management software like MS project can be used to monitor the three EVM

dimensions (PV, EV, and AC), to display graphical trends, and to forecast a range of

possible final project results.


Reserve analysis is used to monitor the status of contingency and management

reserves for the project to determine if these reserves are still needed or if

additional reserves need to be requested. As work on the project progresses, these

reserves may be used as planned to cover the cost of risk mitigation events or other

contingencies. Or, if the probable risk events do not occur, the unused contingency

reserves may be removed from the project budget to free up resources for other

projects or operations.


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7.4.3. Control Costs – Outputs


The calculated CV, SV, CPI, SPI, TCPI, and VAC values for WBS components, work

packages and control accounts, are documented and communicated to stakeholders.

7.4.3.2. Cost Forecasts

A calculated EAC value or a bottom-up EAC value is documented and

communicated to stakeholders.


Outcome of EVM may result in a change request to the cost baseline or other

components of the project management plan. Change requests may include

preventive or corrective actions, and are processed for review and disposition

through the Perform Integrated Change Control process.

7.4.3.4. Project Management Plan Updates

Changes to the cost baseline are incorporated in response to approved changes in

scope, activity resources, or cost estimates. Changes to control thresholds are

updated in cost management plan in response to feedback from relevant

stakeholders.


Cost estimates and Basis of estimates may be updated after reviewing the project

performance.


Organizational process assets that may be updated include, but are not limited to:

Causes of variances,

Corrective action chosen and the reasons,

Financial databases, and

Other types of lessons learned from project cost control.


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Chapter 8: Project Quality

Management


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8. Project Quality Management

Project Quality Management includes the processes and activities of the performing

organization that determine quality policies, objectives, and responsibilities so that the project

will satisfy the needs for which it was undertaken.

ThePMBOK® Guide – 5th Edition.

Knowledge

Area



Monitoring

&

Controlling

Closing

8 Project

Quality

Management

8.1 Plan Quality Management

8.2 Perform Quality Assurance

8.3 Control Quality

8.1. Plan Quality Management

It is one of the key processes that identifies quality standards that are relevant to the

project and steps to satisfy them. It is performed in parallel to other planning processes

and is a key determinant in the formulation of other subsidiary planning processes.

There are several quality planning techniques that are used in different application areas

some of which are discussed here.

Plan Quality Management



Stakeholder Register

Risk Register

Requirements

Documentation

Cost-Benefit Analysis

(Marginal benefit

Analysis)

Cost of Quality (COQ)

Seven basic quality

tools

Quality Management Plan

Process Improvement Plan

Quality Metrics

Quality Checklists

Project document Updates


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Factor


Assets

Benchmarking

Design of Experiments

Statistical Sampling

Addl Quality Planning

Tools

Meetings

8.1.1. Plan Quality Management – Inputs


It can be composed of one or more following subsidiary plans and other

components that will be used to develop the quality management plan:

Scope Baseline: Scope baseline includes Project Scope statement, WBS and

EBS dictionary.

Schedule baseline

Cost baseline

Other Management Plans

8.1.1.2. Stakeholder Register

It provides a list of stakeholders having a particular interest in, or having an impact

on, quality.


It contains information on threats and opportunities that may impact quality

requirements.

8.1.1.4. Requirements Documentation

Requirements documentation captures the requirements that the project must meet

pertaining to stakeholder expectations. The components of the requirements

documentation include, project (including product) and quality requirements. The

requirements are used by the project team to help plan how quality control will be

implemented on the project.


External standards, guidelines and regulations need to be considered as they may

have an effect on the project.


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Historical project data/lessons learnt and policies and procedures derived from them

may affect Quality planning. The Quality policy directs the development of the

quality plan for the project. The policy, which is endorsed by the senior management

is adopted “as is” or, in case of an absence of the same, a quality policy can be

developed for the project. Either way, the project management team communicates

the policy through appropriate information distribution channels.

8.1.2. Plan Quality Management – Tools and Techniques

8.1.2.1. Cost-Benefit Analysis (Marginal benefit Analysis)

The analysis that defines the trade-offs between cost of quality and its returns are

used for planning the Quality of the project.

8.1.2.2. Cost of Quality (COQ)

Quality costs are the total costs involved in preventing nonconformance to

requirements, reviews arid rework. Failure costs, which may be internal or external,

are also called cost of poor quality.

8.1.2.3. Seven basic quality tools

The seven basic quality tools, also known as 7QC Tools, are used within the context

of the PDCA (Plan, Do, Check, Act) Cycle to solve quality-related problems. The

seven basic quality tools are:

Cause-and-effect diagrams which are also known as fishbone diagrams or as

Ishikawa diagrams.

Flowcharts which are also referred to as process maps

Check sheets which are also known as tally sheets

Pareto diagrams exist as a special form of vertical bar chart and are used to

identify the vital few sources that are responsible for causing most of a

problem’s effects.

Histograms are a special form of bar chart and are used to describe the central

tendency, dispersion, and shape of a statistical distribution.

Control charts are used to determine whether or not a process is stable or has

predictable performance.

Scatter diagrams plot ordered pairs (X, Y) and are sometimes called correlation

charts because they seek to explain a change in the dependent variable, Y, in

relationship to a change observed in the corresponding independent variable, X.


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8.1.2.4. Benchmarking

Benchmarks involving actual or planned project practices within or outside the

organization in the same application area or outside are used for quality planning

and performance measurement.

8.1.2.5. Design of Experiments

Design of experiments is a statistical method that identifies which factors influences

specific variables of a product or process under development or in production. This

provides an input in optimization of products or processes and provides a framework

to systematically change all important factors rather than one at a time. Such an

analysis provides information on optimal combination of conditions that can be used

in project implementations.

8.1.2.6. Statistical Sampling

Statistical sampling involves selecting few samples for inspection at random. Sample

frequency and sizes should be determined during the Plan Quality Management

process so the cost of quality will include the number of tests, expected scrap, etc.

8.1.2.7. Additional Quality Planning Tools

Other Quality planning tools like brainstorming, affinity diagrams, force field

analysis, nominal group techniques, matrix diagrams, flowcharts, and prioritization

matrices are often used for effective quality planning.

8.1.2.8. Meetings

Project teams that may include project manager, project sponsor, respective

project team members, stakeholders or anyone with responsibility for Project

Quality Management activities, may hold planning meetings to develop the quality

management plan.

8.1.3. Plan Quality Management – Outputs

8.1.3.1. Quality Management Plan

The quality management plan describes how the project management team will

implement the performing organization’s quality policy. The quality management

plan is an important subsidiary plan of the project management plan and addresses

quality control, assurance and continuous quality improvement.

The quality management plan is brought in early in the project life cycle where

initial decisions, designs and tests are verified by an independent peer group that

may reduce project costs and schedule overruns. This plan is built based on

Individual project requirements.


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8.1.3.2. Process Improvement Plan

This forms a subsidiary of the project management plan. Process Improvement plan

is developed to identify and eliminate non-value adding activities thereby increasing

customer value. They set process boundaries, process metrics and targets for

improved performance.

8.1.3.3. Quality Metrics

A metric describes what project or product is and how the quality control process

measures it. The project management team must indicate the activities where

measurements are of importance. Quality metrics are used in the QA and QC

processes. Some examples of quality metrics include defect density, failure rate,

availability, reliability, and test coverage.

8.1.3.4. Quality Checklists

Standardized checklists that verify a set of required steps to be performed are built

in by organizations to ensure consistency in tasks. In some application areas,

checklists are also available from commercial providers.

8.1.3.5. Project document Updates

Stakeholder register, Responsibility assignment matrix, WBS and WBS Dictionary are

some of the Project documents that may be updated.

8.2. Perform Quality Assurance

Quality assurance is the application of planned, systematic quality activities and processes

to ensure that the project has employed all processes needed to meet the project and

product requirements.

Perform Quality Assurance


Quality Management Plan

Process Improvement Plan

Quality Metrics

Quality Control

Measurements

Project Documents

Quality Management and

Control Tools

Quality Audits

Process Analysis

Change requests

Project Management

Plan Updates

Project document

updates


Assets updates


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8.2.1. Perform Quality Assurance – Inputs

8.2.1.1. Quality Management Plan

The quality management plan describes how the project management team will

implement the performing organization’s quality policy. The quality management

plan is an important input as it define how quality assurance will be done in the

project.

8.2.1.2. Process Improvement Plan

Process Improvement plan is developed to identify and eliminate non-value adding

activities thereby increasing customer value. They set process boundaries, process

metrics and targets for improved performance. The project’s quality assurance

activities should be consistent with the process improvement plans.



measures it. The quality metrics provide the attributes that should be measured and

the allowable variations.

8.2.1.4. Quality Control Measurements

Quality control measurements are the outputs of quality control activities that are

fed back to the QA process for re-evaluating and analyzing the quality standards and

processes of the organization.

8.2.1.5. Project Documents

Project documents may influence quality assurance work and should be monitored

within the context of a system for configuration management.


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8.2.2. Perform Quality Assurance – Tools and Techniques

8.2.2.1. Quality Management and Control Tools

The Perform Quality Assurance process uses the tools and techniques of the Plan

Quality Management and Control Quality processes.

8.2.2.2. Quality Audits

A Quality audit is a structured independent review to determine whether project

activities comply with organizational and project policies, processes and procedures.

The quality audit identifies inefficient and ineffective policies, processes and

procedures currently being used in the project. All efforts to correct these

deficiencies should result ¡n a reduced cost of quality and an increase in the

percentage of acceptance of the product or Service by the customer or sponsor

within the performing organization. Quality audits may be scheduled or at random,

and may be carried out by properly trained in-house auditors or by third parties,

external to the performing organization.

Quality audits confirm the implementation of approved change requests, corrective

actions, defect repairs, and preventive actions.

8.2.2.3. Process Analysis


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The process Improvement plan enables process analysis for continuous Improvement

in technical and organizational areas. Process analysis Includes root cause analysis

to identify the cause, effect and provide solution to a problem.

8.2.3. Perform Quality Assurance – Outputs


Changes that improve the quality of the project, both technical and organizational

are the key output of Perform Quality Assurance Process.


Any update to the Quality Management Plan requires an update to the project

management plan. Existing processes may be updated, process Improvements may

be implemented. Requested changes (additions, modifications, deletions) to the

project management plan and its subsidiary plans are processed through the

Integrated Change Control process.


Project documents that may be updated are Quality audit reports, Training plans

Process documentation.

8.2.3.4. Organizational Process Assets updates

All standards, rules and regulations are updates as a result of any analyses of the QA

activities. These quality standards are used during the Perform Quality Control

Process.

8.3. Control Quality

Quality control (QC) involves monitoring specific project results to determine whether they

comply with relevant quality standards and identifying ways to eliminate causes of

unsatisfactory results. This is performed though out the complete project lifecycle. QC is

often performed by a quality control department and can include taking action to eliminate

causes of unsatisfactory project performance.


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Control Quality



Quality Metrics

Quality Checklists


Approved Change Requests

Deliverables

Project Documents


Assets

Seven Basic Quality

Tools

Statistical Sampling

Inspection

Approve change

request review

Quality Control

Measurements

Validated Changes

Validated Deliverables

Work Performance

Information

Change Requests


Updates

Project Document Updates


assets Update

8.3.1. Control Quality – Inputs


The project management plan contains quality management plan that describes

how the project management team will implement the performing organization’s

quality policy. It define how quality will be controlled and how Quality Control will

be performed throughout the project.



measures it. The project management team must indicate the activities where

measurements are of importance. Quality metrics are used in the QA and QC

processes. Some examples of quality metrics include defect density, failure rate,

availability, reliability, and test coverage.

8.3.1.3. Quality Checklists

Standardized checklists that verify a set of required steps to be performed are built

in by organizations to ensure consistency in tasks. In some application areas,

checklists are also available from commercial providers.


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8.3.1.5. Approved Change Requests

Approved change request can include modifications such as revised work methods,

defect repair and revised schedule. The timely implementation of approved changes

needs to be verified.

8.3.1.6. Deliverables

A deliverable is any unique and verifiable product, result, or capability that results

in a validated deliverable required by the project.


Project documents like agreements, Quality audit reports and change logs supported

with corrective action plans, training plans and assessments of effectiveness and

process documentation such as those obtained using either the seven basic quality

tools or the quality management and control tools can be used as an input in this

process.


The organizational process assets such as organization’s quality standards and

policies, standard work guidelines, issue and defect reporting procedures and

communication policies can be used as in input in this process.


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8.3.2. Control Quality – Tools and Techniques

8.3.2.1. Seven Basic Quality Tools

The seven basic quality tools, also known as 7QC Tools, are used within the context

of the PDCA (Plan, Do, Check, Act) Cycle to solve quality-related problems. The

seven basic quality tools are:

Cause-and-effect diagrams which are also known as fishbone diagrams or as

Ishikawa diagrams.

Flowcharts which are also referred to as process maps

Check sheets which are also known as tally sheets

Pareto diagrams exist as a special form of vertical bar chart and are used to

identify the vital few sources that are responsible for causing most of a

problem’s effects.

Histograms are a special form of bar chart and are used to describe the central

tendency, dispersion, and shape of a statistical distribution.

Control charts are used to determine whether or not a process is stable or has

predictable performance.

Scatter diagrams plot ordered pairs (X, Y) and are sometimes called correlation

charts because they seek to explain a change in the dependent variable, Y, in

relationship to a change observed in the corresponding independent variable, X.

8.3.2.2. Statistical Sampling

Statistical sampling involves selecting few samples for inspection at random. Sample

frequency and sizes should be determined during the Plan Quality Management

process so the cost of quality will include the number of tests, expected scrap, etc.

8.3.2.3. Inspection

An inspection is the examination of a work product to determine if it conforms to

documented standards. The results of an inspection can include measurements and

may be conducted at any level.

8.3.2.4. Approve change request review

All approved change requests should be reviewed to verify that they were

implemented as approved.


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8.3.3. Control Quality – Outputs

8.3.3.1. Quality Control Measurements

Quality control measurements are the documented results of control quality

activities which are captured in the format that was specified through the Plan

Quality Management process.

8.3.3.2. Validated Changes

During Inspection, all the changes implemented are reviewed and are either

accepted or rejected.

8.3.3.3. Validated Deliverables

A goal of the Control Quality process is to determine the correctness of deliverables.

The results of performing the Control Quality process are verified deliverables.

Verified deliverables are an input to Validate Scope (5.5.1.4) for formalized

acceptance.


The work performance data is analyzed in context and integrated based on the

relationship across areas. Work performance data gets transformed into Work

Performance Information and provides a basis for decisions making associated with

project.


As a result of the QC process, all corrective and preventive actions that are required

in the project are initiated in accordance with Integrated Change Control Process.


Any changes to the Quality management Plan that is a result of changes in the QC

process warrants an update in the project management plan.


Project documents like Quality standards, Agreements, Quality audit reports and

change logs supported with corrective action plans, Training plans, Process get

updated as an output of this process.

8.3.3.8. Organizational Process assets Update

Results of Quality Control process especially the causes of the variances, reasons for

corrective actions and other lessons may be archived to use as a reference in future

projects.


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Chapter 9: Project Human Resource

Management


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9. Project Human Resource Management

Project Human Resource Management includes the processes that organize, manage, and lead

the project team.


Knowledge

Area



Monitoring

and

Controlling

Closing

9 Project

Human

Resource

Management

9.1 Plan Human ResourceManag4ement

9.2 Acquire Project Team

9.3 Develop Project Team

9.4 Manage Project Team

9.1. Plan Human Resource Management

Human Resource Planning process helps organization in developing staffing management

plan, determines project roles, responsibilities, and reporting relationships. Staffing

management plan specifies how and when team members will be acquired, determining If

a training need exists and if It does, what training is required to fill the gap, recognition

and rewards plan and safety issue. Project roles are designated for persons or groups from

inside or outside the performing organization.

Human Resource Planning determines project roles, responsibilities and reporting

relationships and creates the staffing management plan. Project roles can be designated

for persons or groups. Those persons or groups can be from inside or outside the organization

performing the project. The staffing management plan can Include how and when project

team members will be acquired, the criteria for releasing them from the project,

identification of training needs, recognition and rewards, compliance considerations, safety

issues and the impact of the staffing management plan on the organization.


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Plan Human Resource Management



Activity Resource

Requirements


Factors


Organization Charts and

Position Descriptions

Networking

Organizational Theory

Expert Judgment

Meetings

Human Resource

Management Plan

9.1.1. Plan Human Resource Management – Inputs


The project management plan consist of project life cycle and the processes that

will be applied to each phase, change management plan and needs and methods of

communication among stakeholders. This information will be used as an input and

will set the guidelines on how the project team will be formed.

9.1.1.2. Activity Resource Requirements

It is used to determine the human resource needs for the project and preliminary

requirements regarding the required people and competencies for the project team

members.


The definition of project roles and responsibilities is developed with in accordance

with enterprise factors that surround and influence the project success. The

definition of project roles and responsibilities is developed with an understanding of

the ways that existing organizations will be involved. Some of the relevant enterprise

environmental factors are Organizational, Interpersonal, Logistical and Political.


Lessons learned from the past projects can be used as in input to help plan the

current project that can reduce the amount of planning time needed at the

beginning of a project and reduce the likelihood of missing important

responsibilities. Organizational Process Assets also includes templates and checklists

for creating the HR Management plan.


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9.1.2. Plan Human Resource Management – Tools and Techniques

9.1.2.1. Organization Charts and Position Descriptions

Various formats are available to document team member roles and responsibilities

and most of them fall into one of three types: hierarchical, matrix, and text

oriented. Additionally, some project assignments are listed in subsidiary project

plans like Risk, Quality, or Communication plans with a clear Objective to ensure

that each work package has an unambiguous owner and all team members have a

clear understanding of their roles and responsibilities.

9.1.2.2. Networking

Informal interaction with others is needed to understand political arid interpersonal

factors that may affect the effectiveness of various staffing management options

within an organization or industry. Networking activities include proactive

correspondence, luncheon meetings, informal conversations, and trade conferences.

While concentrated networking can be a useful technique at the beginning of a

project, carrying out networking activities on a regular basis before a project begins

is also effective.

9.1.2.3. Organizational Theory

It provides information regarding the behavior of people, teams, and organizational

units. By applying proven principles, the amount of time needed to create the

Human Resource Management Plan can be shortened. It also improves the likelihood

that the planning wilt be effective.


Access to the inputs require to develop the HR management plan is often provided

by Expert Judgment. Such judgment and expertise is applied to any technical and





Consultants



Industry groups.


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9.1.2.5. Meetings

While developing the HR management plan, project manager, project team and

stakeholders may need to conduct meetings to discuss HR management plan.

9.1.3. Plan Human Resource Management – Outputs


Key output of this process is the HR Management Plan which provides guidance on

how project human resources will be defined, staffed and released. The HR

Management plan includes following:

Roles and Responsibilities: The items Listed below must be addressed while

listing the roles and responsibilities needed to complete the project:

1) Role: It is a label that describes the portion of a project for which a

person is accountable. Role clarity concerning authority, responsibilities,

and boundaries is essential for project success.

2) Authority: Authority is the right, given to project manager or

management, to apply project resources, makes decisions, and sign

approvals. Some of decisions that need clear authority include the

selection of a method for completing an activity, quality acceptance, and

response to project variances. Team members operate best when their

individual levels of authority matches their individual responsibilities.

3) Responsibility: The work that a project team member is expected to

perform In order to complete the project’s activities.

4) Competency: Competency is the skill and capacity required to complete

project activities. The performance of team members can be affected

negatively if they lack required competencies. When such mismatches

are identified, proactive responses such as training, hiring, schedule

changes, or scope changes are initiated.

Project Organization Chart: It displays the project team members and their

reporting relationships in a graphical manner. It can be formal or informal,

highly detailed or broadly framed, based on the needs of the project.

Staffing Management Plan: It describes how and when resource requirements

will be met as per the needs of the project. The plan is updated continuously

during the project to direct ongoing acquisition of the team members and

actions towards their development. Information in the staffing management

plan varies by application area and project size but items to consider


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includes, Staff Acquisition, Resource Calendars, Staff Release Plan, Training

Needs, Reward and Recognition, Compliance and Safety.

9.2. Acquire Project Team

Acquire Project Team is the process of acquiring the human resources needed to complete

the project. The project management team may or may not have control over team

members selected for the project.

Acquire Project Team


Human Resource

Management Plan


Factors


Assets

Pre-assignment

Negotiation

Acquisition

Virtual Teams

Multi-criteria decision

analysis

Project Staff

Assignments

Resource Calendars

Project Management

Plan Updates

9.2.1. Acquire Project Team – Inputs


HR Management plan includes Staffing management plan, Roles and responsibilities

and Project organization charts that will provide key inputs on how the project team

members will be identified, staffed, managed and released.


Factors that influence acquisition of the project team includes availability of the

resources in the organization, competency levels, experience and their cost, HR

administration policies and their cost rates.


The organizational process assets that influence the Acquire Project Team process

include, organizational standard policies, processes, and procedures.


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9.2.2. Acquire Project Team – Tools and Techniques

9.2.2.1. Pre-assignment

Sometimes, project team members are pre-assigned that means they are selected

in advance. This situation may occur if the project is the result of specific people

being promised as part of a competitive proposal, if the project is dependent on the

expertise of particular persons, or if some staff assignments are defined within the

project charter.

9.2.2.2. Negotiation

Negotiations may happen on many projects. To ensure that the project receives

appropriately competent staff in the required time frame, and that project team

members will be able to work on the project until their responsibilities are

completed, the project management team may need to negotiate with Functional

managers. The project management team may also need to negotiate with other

project teams within the performing organization to appropriately assign scarce or

specialized resources.

9.2.2.3. Acquisition

Sometimes, required services can be acquired from outside sources if the performing

organization lacks the in-house staff needed to complete the project. This can

involve hiring individual consultants or subcontracting work to another organization.

9.2.2.4. Virtual Teams

While acquiring project team members, the use of virtual teams, which can be

defined as groups of people with a shared goal, creates new possibilities. Virtual

teams can also be defined as, who fulfill their roles with little or no time spent

meeting face to face. The availability of electronic communication, such as email

and video conferencing, has made such teams feasible. The virtual team format

makes it possible to form teams of people from the same company who live in

widespread geographic areas.

9.2.2.5. Multi-criteria decision analysis

Multi-criteria decision analysis is a tool where selection criteria’s are developed and

used to rate or score potential team members. The criteria are given weights

according to the importance of the needs within the team. Some of the key selection

criteria’s are availability, cost, experience and ability of the resources.


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9.2.3. Acquire Project Team – Outputs

9.2.3.1. Project Staff Assignments

As an output of this process, appropriate people are assigned to the project

activities. The documentation of these assignments can include a project team

directory, memos to team members, and names inserted into other parts of the

project management plan, such as project organization charts and schedules.


It documents the time periods each project team member will work on the project.

Creating a reliable final schedule depends on having a good understanding of each

person’s schedule conflicts, including vacation time and commitments to other

projects.


Key elements of Project Management plan that will be updated at end of this process

are HR & Staffing Management plans because people seldom fit the exact staffing

requirements that are planned as sometimes specific people are required to fill the

project roles and responsibilities. Other reasons for making changes to HR

Management plan include changes to team structure, roles or responsibilities.

9.3. Develop Project Team

It improves the competencies and interaction of team members to enhance project

performance. Objectives of developing project team are:

Increase team member’s ability to complete project activities by improving their

skills.

Raise productivity through greater teamwork by improving feelings of trust and

cohesiveness among team members. Examples of effective teamwork include assisting

one another when workloads are unbalanced, communicating in ways that fit

individual preferences, and sharing Information and resources. Team development

efforts have greater benefit when conducted early, but should take place throughout

the project lite cycle.


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Develop Project Team


Human Resource

Management Plan

Project Staff Assignments

Resource Calendars

Interpersonal Skill

Training

Team-Building

Activities

Ground Rules

Co-location

Recognition and

Rewards

Personnel assessment

tools

Team Performance

Assessments


Factors Updates

9.3.1. Develop Project Team – Inputs











It documents the time periods each project team member will work on the project.

Creating a reliable final schedule depends on having a good understanding of each

person’s schedule conflicts, including vacation time and commitments to other

projects.


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9.3.2. Develop Project Team – Tools and Techniques

9.3.2.1. Interpersonal Skill

Soft Skills or Interpersonal skills are particularly important for project managers to

develop the team. Effective project managers acquire a balance of technical,

interpersonal, and conceptual skills that help them analyze situations and interact

appropriately. Some of the important interpersonal skills are

Leadership

Team building

Motivation

Communication

Influencing

Decision making

Political and cultural awareness

Negotiation

Trust building

Conflict management

Coaching

9.3.2.2. Training

It includes all formal or Informal activities designed to enhance the competencies of

the project team members. Examples of training methods Include classroom, online,

computer based, on the job training from another project team member, mentoring

and coaching.

9.3.2.3. Team-Building Activities

It may vary from an agenda item, having very short duration, a status review meeting

to an offsite, professionally facilitated experience designed to improve Interpersonal

relationships. Some group activities, such as developing the WBS, may not be

explicitly designed as team building activities but can increase team cohesiveness

when that planning activity is structured and facilitated well. It also is Important to

encourage informal communication and activities because of their role in building

trust and establishing good working relationships. Teambuilding strategies are

particularly valuable when team members operate virtually from remote locations,

without the benefit of face to face contact.


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9.3.2.4. Ground Rules

Ground rules clearly specify the expected acceptable behavior by project team

members. Early commitment to clear guidelines decreases misunderstandings and

increases productivity. The process of discussing ground rules allows team members

to discover values that are important to one another. All project team members

share responsibility for enforcing the rules once they are established.

9.3.2.5. Co-location

It involves enhancing people’s ability to perform as a team by placing many or all of

the most active project team members in the same physical location. During the

project, team members can be collocated temporarily at strategically important

times, or for the entire project.

9.3.2.6. Recognition and Rewards

Recognizing and rewarding desirable behavior is an important part of the team

development process. Reward and recognition plan takes shape while creating the

HR Management plan. Award decisions are made, formally or informally, during the

process of managing the project team through performance appraisals. Only

desirable behavior should be rewarded. For example, the willingness to work

overtime to meet an aggressive schedule objective should be rewarded or recognized

but needing to work overtime as the result of poor planning should not be rewarded.

Win-lose (zero sum) rewards that only a limited number of project team members

can achieve, such as team member of the month, can hurt team cohesiveness.

Rewarding win-win behavior that everyone can achieve, such as turning progress

reports on time, tends to increase support among team members. Recognition and

rewards should consider cultural differences as well.

9.3.2.7. Personnel assessment tools

Personnel assessment tools give the project manager and the project team insight

into areas of strength and weakness. These tools help project managers assess the

team preferences, aspirations, how they process and organize information, how they

tend to make decisions, and how they prefer to interact with people.

9.3.3. Develop Project Team – Outputs

9.3.3.1. Team Performance Assessments

Formal or informal or assessments of the project team’s effectiveness is done while

implementing the team development efforts such as training, team building, and

colocation. Team’s performance can be increased by making effective team

development strategies which also increases the likelihood of meeting project


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objectives. The evaluation of a team’s effectiveness may include improvements in

skills that allow a person to perform assigned activities more effectively and

improvement in competencies and sentiments that help the team perform better as

a group reduced staff turnover rate.

9.3.3.2. Enterprise Environmental Factors Updates

The enterprise environmental factors that may be updated as a result of the Develop

Project Team process include personnel administration, employee training records,

and skill assessments.

9.4. Manage Project Team

Project performance can be enhanced by tracking team member’s performance, providing

feedback, resolving issues and coordinating changes. Team behavior, manage conflicts,

resolve issues and praise team member’s performance are also observed by the project

management team and as a result the staffing management plan is updated, change

requests are submitted, issues are resolved, input is given to organizational performance

appraisals, and lessons learned are added to the organization’s database.

Manage Project Team



Plan

Project Staff Assignments

Team Performance Assessments

Issue Log

Work Performance Reports


Observation and

Conversation

Project Performance

Appraisals

Conflict Management

Interpersonal Skills

Change Requests


Updates

Project Documents

Update


Factors Updates


Assets Updates


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9.4.1. Manage Project Team – Inputs










9.4.1.3. Team Performance Assessments

Formal or informal or assessments of the project team’s effectiveness is done while

implementing the team development efforts such as training, team building, and

colocation. Team’s performance can be increased by making effective team

development strategies which also increases the likelihood of meeting project

objectives. The evaluation of a team’s effectiveness may include improvements in

skills that allow a person to perform assigned activities more effectively and

improvement in competencies and sentiments that help the team perform better as

a group reduced staff turnover rate.

9.4.1.4. Issue Log

An issue log can be used to document and monitor who is responsible for resolving

specific issues by a target date.


It provides documentation about project performance against the project

management plan. Results from performance areas like control schedule, control

cost, control quality, scope verification, and procurement audits and their related

forecasts assists the project team management In determining future human

resource requirements, recognition and rewards and updates to HR Management

plan.


The organizational process assets that influence the Manage Project Team process

include, organizational standard policies, processes, and procedures.


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9.4.2. Manage Project Team – Tools and Techniques

9.4.2.1. Observation and Conversation

Observation and conversation are used to stay in touch with the work and attitudes

of project team members. The project management team monitors indicators such

as progress toward project deliverables, accomplishments that are a source of pride

for team members, and interpersonal issues.

9.4.2.2. Project Performance Appraisals

The length and complexity of the project, organizational policy, labor contract

requirements, and the amount and quality of regular communication determines the

need for formal or informal project performance appraisals. Project team members

receive feedback from the people who supervise their project work.

9.4.2.3. Conflict Management

Greater productivity and positive working relationships are the results of successful

conflict management whereas scarce resources, scheduling priorities and personal

work styles are major sources of conflicts. Team ground rules, group norms, solid

project management practices, like communication planning and role definition,

reduce the amount of conflict. If differences of opinion are managed properly, they

can be healthy, and can lead to increased creativity and better decision making.

When the differences become a negative factor, project team members are initially

responsible for resolving their own conflicts. The project manager should help

facilitate a satisfactory resolution in case conflict escalates. Conflict should be

addressed arty and usually in private, using a direct, collaborative approach. If

disruptive conflict continues, increasingly formal procedures will need to be used,

including the possible use of disciplinary actions.

9.4.2.4. Interpersonal Skills

People Management, relationship creation and retention are of today’s order of the

day with internal customer, external customers, external agencies, governmental

agencies, society, and stakeholders. interpersonal skills are of paramount important

in order to be successful In today’s competitive, mechanical, fast-phased,

demanding environment, coupled with a diverse workforce, call for significant

amounts of people management skills, e.g.:



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9.4.3. Manage Project Team – Outputs


Staffing changes may affect the rest of the project plan irrespective of whether by

choice or by uncontrollable events. A change request can be processed through the

Integrated Change Control process when staffing issues disrupts the project plan,

such as causing the schedule to be extended or the budget to be exceeded.


Approved charge requests, corrective actions, new project team member roles,

additional training, and reward decisions can result in updates to the HR

Management plan, a part of the project management plan.

9.4.3.3. Project Documents Update

Documents such as Issue log, Roles description and Project staff assignments may

require an update.

9.4.3.4. Enterprise Environmental Factors Updates

Enterprise environmental factors that may require updates may include inputs to

organizational performance appraisals and Personnel skill updates.


Project management team should be prepared to provide inputs for regular

organizational performance appraisals of any project team member with whom they

interact in a significant way. In order to create historical database of the

organization, all knowledge learned during the project should be documented.

Lessons learned in the area of HR Management can include a Project organization

chart, position descriptions, and staffing management plans that can be saved as

templates, Ground rules, conflict management techniques, and recognition events

that was particularly useful, a procedure for virtual teams, co-Location, negotiation,

training, and team building that proved to be successful.


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Chapter 10: Project

Communications Management


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10. Project Communications Management

Project Communications Management includes the processes that are required to ensure timely

and appropriate planning, collection, creation, distribution, storage, retrieval, management,

control, monitoring, and the ultimate disposition of project information.


Knowledge

Area



Controlling Closing

10 Project

Communications

Management

10.1 Plan Communications Manag4ement

10.2 Manage Communications

10.3 Control Communications

10.1. Plan Communications Management

Plan Communications Management process determines the information and communication

needs of the stakeholders, for example who needs what information, when they will need

it, how it will be given to them, and by whom. A project manager spends most of his time

communicating with the various stakeholders and providing necessary information to the

project team to successfully complete their work.

Plan Communications Management





factors


assets

Communication

Requirement Analysis

Communication

Technology

Communication Models

Communication

Methods

Communications

Management Plan

Project Documents Update


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Meetings

10.1.1. Plan Communications Management – Inputs


The project management plan provides information about the project Including

schedule and constraints that may be relevant to Communication Management Plan.


The stakeholder register provides the information needed to plan the communication

with project stakeholders.


Environmental factors such as a Project Management Information System need to be

included to do effective communication planning. Organizational structure and

existing human resources should be taken into account in this process.


Lessons learned and historical information are two very important organizational

assets that help in creating the Communication Management Plan. These two can

provide both decisions and results based on previous similar projects concerning

communication issues.

10.1.2. Plan Communications Management – Tools and Techniques

10.1.2.1. Communication Requirement Analysis

The complete information needs of all the stakeholders are provided as a result of

the communication requirements analysis of the stakeholders. These requirements

are defined by combining the type and format of information needed with an analysis

of the value of that that information. This is to prevent overloading stakeholders

with irrelevant information.


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10.1.2.2. Communication Technology

Each stakeholder in a project may use different medium and methods for

communication. The project manager should identify the proper technology and

method for delivering information to the respective stakeholders. Communications

technology factors that can affect the project include:

The Importance and urgency of the need for information

The availability of technology, processes and methods

The people who are being utilized in the project and who will interact with

the system

The duration of the project. Is the available technology likely to change

before the project is over and if so, how scalable is the current technology?

The project working environment. Does the team meet and operate on a face-

to-face basis or in a virtual environment?

10.1.2.3. Communication Models

A basic communication model consists of two parties, sender and receiver. Medium

is the technology medium and includes the mode of communication while noise

includes any interference or barriers that might compromise the delivery of the

message. The order in which the communication will take place is encode transmit

message receive decode acknowledge feedback.

10.1.2.4. Communication Methods

There are several communication methods that are used to share information among

project stakeholders. These methods are broadly classified as follows:

Interactive communication: Between two or more parties performing a

multidirectional exchange of information.

Push communication: Sent to specific recipients who need to receive the

information.

Pull communication: Used for very large volumes of information, or for very

large audiences, and requires the recipients to access the communication

content at their own discretion.

10.1.2.5. Meetings

While developing the Communication Management Plan, project manager, project

team and stakeholders may need to conduct meetings to discuss most appropriate

way of communicating the project information to stakeholders.


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10.1.3. Plan Communications Management – Outputs

10.1.3.1. Communications Management Plan

The communications management plan describes how project communications will

be planned, structured, monitored, and controlled. Some of the key components of

the plan are listed below:

Stakeholder communication requirements

Information to be communicated

Time frame and frequency of communication

Person responsible for communicating the information

Person or groups who will receive the information

Methods or technologies used for communication

Resources allocated for communication activities


Project documents that may be updated include Project schedule and Stakeholder

register.

10.2. Manage Communications

Manage Communication involves creating, collecting, storing, retrieving and making project

performance and project related information available to project stakeholders in a timely

manner as finalized in Communication Management.

Manage Communications


Communications

Management Plan

Work performance Reports


factors


assets

Communication

technology

Communication models

Communication

methods

Information

Management Systems

Performance Reporting

Project Communications

Project Management plan

Updates



assets Updates


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10.2.1. Manage Communications – Inputs


The communications management plan describes how project communications will

be planned, structured, monitored, and controlled. Some of the key components of

the plan are listed below:


Information to be communicated

Time frame and frequency of communication

Person responsible for communicating the information

Person or groups who will receive the information

Methods or technologies used for communication

Resources allocated for communication activities

10.2.1.2. Work performance Reports

Work performance reports are status reports, information notes, recommendations,

and updates to help project team and stakeholders to take decisions, actions, or

awareness. Source of work performance reports is the work performance information

that is compiled in the project documents.


Organizational culture and structure, Government or industry standards &

regulations and Project management information system are some of the specific

enterprise environmental factors that can influence the Manage Communications

process.


Project team can refer to the communication templates historical information and

lessons learned from previous projects in Manage Communications process.

10.2.2. Manage Communications – Tools and Techniques

10.2.2.1. Communication technology

Each stakeholder in a project may use different medium and methods for

communication. The project manager should identify the proper technology and

method for delivering information to the respective stakeholders. Communications

technology factors that can affect the project include:


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The Importance and urgency of the need for information

The availability of technology, processes and methods

The people who are being utilized in the project and who will interact with the

system

The duration of the project. Is the available technology likely to change before

the project is over and if so, how scalable is the current technology?

The project working environment. Does the team meet and operate on a face-

to-face basis or in a virtual environment?

10.2.2.2. Communication models

A basic communication model consists of two parties, sender and receiver. Medium

is the technology medium and includes the mode of communication while noise

includes any interference or barriers that might compromise the delivery of the

message. The order in which the communication will take place is encode transmit

message receive decode acknowledge feedback.

10.2.2.3. Communication Methods






information.




10.2.2.4. Information Management Systems

Project Information can be gathered and distributed through a variety of methods.

The most common methods are manual filing systems, electronic databases, project

management software, and systems that allow access to technical documentation,

such as engineering drawings, design specifications, and test plans. These systems

are dependent on the communication technology specified.


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10.2.2.5. Performance Reporting

The performance reporting is the collection of all baseline data, and distribution of

performance information to stakeholders. Performance reporting focuses on how

resources are being used to achieve project objectives. Performance reporting

provides information on scope, schedule, cost, and quality.

10.2.3. Manage Communications – Outputs

10.2.3.1. Project Communications

Project communications includes performance reports, deliverables status, schedule

progress, and cost incurred. Project communications can vary significantly and are

influenced by factors such as the urgency and impact of the message, its method of

delivery, and level of confidentiality.

10.2.3.2. Project Management plan Updates

The project management plan provides information on project baselines,

communications management, and stakeholder management. Each of these areas

may require updates based upon the current performance of the project against the

performance measurement baseline.


Issue log, Project schedule and Project funding requirements documents may get

updated as a result of Manage Communications process.

10.2.3.4. Organizational process assets Updates

The organizational process assets, which may be updated include:

Stakeholder notifications

Project reports

Project presentations

Project records

Feedback from stakeholders

Lessons learned documentation

10.3. Control Communications

Control Communications is the process of monitoring and controlling communications

throughout the entire project life cycle to ensure the information needs of the project

stakeholders are met.


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Control Communications



Project Communications

Issue Log



assets

Information

Management Systems

Expert Judgment

Meetings

Work Performance

Information

Change Requests


Updates

Project Documents Updates


assets Updates

10.3.1. Control Communications – Inputs

10.3.1.1. Project Management plan

The project management plan describes how the project will be executed,

monitored, controlled, and closed. It provides valuable information for the Control

Communications process such as:


Reason for the distribution of the information

Timeframe and frequency for the distribution of required information

Individual or group responsible for communication of the information

Individual or group receiving the information

10.3.1.2. Project Communications

Project communications includes performance reports, deliverables status, schedule

progress, and cost incurred. Project communications can vary significantly and are

influenced by factors such as the urgency and impact of the message, its method of

delivery, and level of confidentiality.

10.3.1.3. Issue Log

An issue log can be used to document and monitor resolution of issue and who is

responsible for resolving specific issues by a target date.


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Project team can refer to policies, standards and procedures that are defines

communication. It may also provide the communication templates, historical

information and lessons learned from previous projects in Control Communications

process.

10.3.2. Control Communications – Tools & Techniques








Experts with specialized knowledge of communication and experience in similar

projects may be used to assess the impact of communication.

10.3.2.3. Meetings

Project manager, project team and stakeholders may need to conduct meetings to

discuss most appropriate way of to update and communicate the project information

to stakeholders.

10.3.3. Control Communications – Outputs


The work performance data is analyzed in context and integrated based on the

relationship across areas. Work performance data gets transformed into Work

Performance Information and provides a basis for decisions making associated with

project.


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As a result of the Control Communications process, all corrective and preventive

actions that are required in the project communication are initiated in accordance

with Integrated Change Control Process.


The project management plan provides information on communications stakeholder

management. Each of these areas may require updates based upon the current

performance of the project against the performance measurement baseline.

10.3.3.4. Project Documents Updates

Project documents that may be updated include:

Forecasts

Performance reports

Issue log

10.3.3.5. Organizational process assets Updates

Report formats and lessons learned with respect to project communications may

become part of the historical database for current project and the performing

organization and may include the causes of issues, reasons behind the corrective

action chosen, and other types of lessons learned during the project.


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Chapter 11: Project Risk

Management


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11. Project Risk Management

Project Risk Management includes the processes of conducting risk management planning,

identification, analysis, response planning, and controlling risk on a project.


Knowledge

Area



Monitoring

and

Controlling

Closing

11 Project Risk

Management

11.1 Plan Risk Management

11.2 Identify Risks

11.3Perform Qualitative Risk Analysis

11.4 Perform Quantitative Risk Analysis

11.5 Plan Risk Response

11.6 Control Risk

11.1. Plan Risk Management

Plan Risk Management is the process of deciding how to approach and conduct the risk

management activities for a project. Risk Management Planning is important to ensure

that the level, type and visibility of risk management are commensurate with both the

risk and importance of the project to the organization. Planning is also important to

provide sufficient resources and time for risk management activities and to establish an

agreed- upon basis for evaluating risks.

Plan Risk Management



Project Charter



Expert Judgment

Meetings

Risk management plan


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factors


assets

11.1.1. Plan Risk Management – Inputs


In planning risk management, all approved subsidiary management plans and

baselines should be taken into consideration in order to make the risk management

plan consistent with them.


The project charter can provide various inputs such as high-level risks, high-level

project descriptions, and high-level requirements.


The stakeholder register contains list of all stakeholders associated with the project.

It is used as an input to get an overview of their roles.

11.1.1.4. Enterprise environmental factor

The attitude toward risk and the risk tolerance of organization and people involved

in the project will influence the project management plan. Risk attitudes and

tolerances may be expressed in policy statements or revealed in actions.


Organizations may have predefined approaches to risk management such as risk

categories, common definition of concepts and terms, standard templates, roles and

responsibilities and authority levels for decision making.


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11.1.2. Plan Risk Management – Tools and Techniques


Analytical techniques are applied in project management to choose strategic options

related to project risk. They also help understand and define the overall risk

management context of the project and perform high-level assessment of the risk

exposure of the project based on the overall project context.


To prepare a comprehensive Risk Management Plan, expert judgment and expertise

are applied to any risk related technical and management details during this process.

Such expertise is provided by any group or individual with specialized knowledge or

training and can be made available from several sources including:


Senior Management

Consultants



Industry groups.

11.1.2.3. Meetings

Project manager, project team and stakeholders may need to conduct meetings to

develop the Risk management Plan.

11.1.3. Plan Risk Management – Outputs

11.1.3.1. Risk Management Plan

The Risk Management Plan describes how risk management will be structured and

performed on the project. It becomes a subset of the project management plan. The

risk management plan includes the following:

Methodology: Defines the approaches, tools, and data sources that may be

used to perform risk management on the project.

Roles and Responsibilities: Defines the Lead, support, members of the risk

management team for each type of activity in the risk management plan,

assigns people to these roles, and clarifies their responsibilities.

Budgeting: Assigns resources and estimates costs needed for risk management

for inclusion in the project cost baseline.


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Timing: Defines schedule and frequency of the risk management process that

will be performed throughout the project tile cycle, and establish risk

management activities in the project schedule.

Risk Categories: Provides a structure that ensure a comprehensive process of

systematically Identifying risk to a consistent level of detail and contributes to

the effectiveness and quality of Risk Identification. A risk breakdown structure

(RBS) is one approach to providing such a structure.

Definitions of Risk Probability and impact: The quality and credibility of the

Qualitative Risk Analysis process requires that different levels of the risk

probabilities and impact be defined. General definitions of probability levels

and impact Levels are tailored to the individual projects during the Risk

Management planning process for use in the Qualitative Risk Analysis process.

Probability and Impact Matrix: Risks are prioritized according to their

potential implications on meeting the project’s objectives. The typical

approach in prioritizing risk is to use a lookup table or a Probability and Impact

Matrix. The specific combination of probability and impact leads to a risk being

rated as of high, moderate or low Importance.

Revised Stakeholders’ tolerances: Stakeholders tolerances may be revised in

the Plan Risk Management process, as they apply to the specific project.

Reporting Formats: Describes the content and format of the risk register as

well as any other required risk related reports. Defines how the outcomes of

the risk management processes will be documented, analyzed, and

communicated.

Tracking: Documents whether and the risk management processes will be

audited.

11.2. Identify Risk

Identify Risk process determines which risk may affect the project and documents their

characteristics. Participants in risk identification activities can include project manager,

project team members, risk management team (if assigned), subject matter experts from

outside the project team, customers, end users, other project managers, stakeholders and

risk management expects. The Risk Identification process usually leads to the Qualitative

Risk Analysts process.


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Identify Risk



Cost management plan

Schedule management plan

Quality management plan


plan

Scope baseline

Activity cost estimates



Project documents

Procurement documents


factors

Organizational process assets

Documentation reviews

Information gathering

techniques

Checklist analysis

Assumptions analysis

Diagramming techniques

SWOT analysis

Expert judgment

Risk register

11.2.1. Identify Risk – Inputs

11.2.1.1. Risk management plan

Key elements of the Risk Management Plan that contribute to the Identify Risks

process are the roles and responsibilities, provision for risk management activities

in the budget and schedule, and categories of risk.

11.2.1.2. Cost management plan

The cost management plan provides processes and controls that can be used to help

identify risks across the project.

11.2.1.3. Schedule management plan

The schedule management plan provides insight to project time/schedule objectives

and expectations which may be impacted by risks (known and unknown).


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11.2.1.4. Quality management plan

The quality management plan provides a baseline of quality measures and metrics

for use in identifying risks.

11.2.1.5. Human Resource Management plan

The human resource management plan provides guidance on how project human

resources should be defined, staffed, managed, and eventually released form a key

input to identify risk process.

11.2.1.6. Scope baseline

Project assumptions are found in the project scope statement. Uncertainty in

project assumptions should be evaluated as potential causes of project risk.

11.2.1.7. Activity cost estimates

Activity cost estimate reviews are useful in identifying risks as they provide a

quantitative assessment of the likely cost to complete scheduled activities.


Activity duration estimate reviews are useful in identifying risks related to the time

allowances for the activities or project as a whole, again with the width of the range

of such estimates indicating the relative degree(s) of risk.

11.2.1.9. Stakeholder register

Information about the stakeholders is useful for soliciting inputs to identify risks, as

this will ensure that key stakeholders, especially the stakeholder, sponsor, and

customer are interviewed or otherwise participate during the Identify Risks process.

11.2.1.10. Project documents

Project team gets the information about decisions that help better identify project

risks. Project documents improve cross-team and stakeholder communications and

include Project Charter, Project Schedule, Issue Logs, and Schedule Network

Diagrams etc.

11.2.1.11. Procurement Documents

Any external procurement of product, service or result become a key input to the

Identify Risks process.


Enterprise environmental factors that can influence the Identify Risks process

include:

Published information, including commercial databases


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Academic studies

Published checklists

Benchmarking

Industry studies

Risk attitudes.


Organizational process assets that can influence the Identify Risks process include:

Project files, including actual data

Organizational and project process controls

Risk statement formats or templates

Lessons learned

11.2.2. Identify Risk – Tools and Techniques

11.2.2.1. Documentation reviews

A structured review of project documentation, including subsidiary plans,

assumptions, prior project files, and other information can be performed.

11.2.2.2. Information gathering techniques

Key information gathering techniques used in identifying risk can include following:

Brainstorming: The goal of brainstorming is to obtain a comprehensive list of

project risks. Risks are then Identified and categorized by type of risk and their

definitions are sharpened.

Delphi Technique: A facilitator uses a questionnaire to solicit ideas about the

important project risks. The responses are summarized and are then re-

circulated to the experts for further comment.

Interviewing: Interviewing experienced project participants, stakeholders and

subject matter expects can help identify risks.

Root Cause Identification: This is an inquiry into the essential causes of a

project’s risks. Effective risk responses can be developed if the root cause of

the risk is addressed.

11.2.2.3. Checklist analysis

Risk Identification checklists can be developed based on historical information and

knowledge that has been associated from previous similar projects and from other

sources of information. The lowest Level of the risk can also be used as a risk

checklist.


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11.2.2.4. Assumptions analysis

Assumptions analysis is a tool that explores the validity of assumptions as they apply

to the project. It identifies risks to the project from inaccuracy, inconsistency, or

incompleteness of assumptions.

11.2.2.5. Diagramming techniques

Risk diagramming techniques may include:

Cause-and-effect diagrams: These are also known as Ishikawa or Fishbone

diagrams, and are useful for identifying root causes of risks.

System or process flow charts: These show how various elements of a system

interrelate.

Influence diagrams: These are graphical representations of situations showing

causal influences, time ordering of events, and other relationships among

variables and outcomes.

11.2.2.6. SWOT analysis

This technique ensures examination of the project from each of the SWOT (Strength,

Weakness, Opportunity and Threat) perspectives, to increase the breadth of

considered risks.

11.2.2.7. Expert judgment

Risks may be identified directly by experts with relevant experience with similar

projects or business areas. Such experts should be identified by the project manager

and invited to consider all aspects of the project and suggest possible risks based on

their previous experience and areas of expertise.

11.2.3. Identify Risk – Outputs

11.2.3.1. Risk register

The primary outputs from Risk Identification are the Initial entries into the risk

register, which becomes a component of the project management plan. The

preparation of the risk register begins in the Risk identification process with the all

the potential risk being captured, and then becomes available to other project

management and Project Risk Management processes. It includes all identified risks

including their root causes and uncertain project assumptions.


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11.3. Perform Qualitative Risk Analysis

Qualitative Risk Analysis includes methods for prioritizing the identified risks for further

action, such as Quantitative Risk Analysts or Risk Response Planning. Organizations can

improve the project’s performance effectively by focusing on high priority risks. Qualitative

Risk Analysis assesses the priority of identified risks using their probability of occurrence,

the corresponding impact on project objectives as well as other factors such as the time

frame if the risks occurs and risk tolerance of the project constraints of cost, schedule scope

and quality.

Perform Qualitative Risk Analysis



Scope Baseline

Risk register

Enterprise Environment

Factors


assets

Risk probability and impact

assessment

Probability and impact

matrix

Risk data quality

assessment

Risk categorization

Risk urgency assessment

Expert judgment

Project Documents

Updates

11.3.1. Perform Qualitative Risk Analysis – Inputs


Key elements of the risk management plan for Qualitative Risk Analysis include roles

and responsibilities for conducting risk management, budgets, activities for risk

management, risk categories, definition of probability and impact, the probability

and Impact matrix, and revised stakeholders’ risk tolerances. These inputs are

usually tailored to the project during the Risk Management Planning process.


Projects of a common or recurrent type tend to have more well-understood risks.

Projects using state-of-the-art or first-of-its-kind technology, and highly complex


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projects, tend to have more uncertainty. This can be evaluated by examining the

scope baseline.


The risk register contains the detailed list of risks and their associated information

that will be used to assess and prioritize risks.

11.3.1.4. Enterprise Environment Factors

Enterprise environmental factors may provide insight and context to the risk

assessment such as Industry studies of similar projects by risk specialists and risk

databases that may be available from industry or proprietary sources.


Data about past projects and lessons learned knowledge base can be used in the

Qualitative risk analysis.

11.3.2. Perform Qualitative Risk Analysis – Tools and Techniques

11.3.2.1. Risk probability and impact assessment

Risk probability assessment investigates the likelihood that each specific risk will

occur. Risk impact assessment investigates the potential effect on the project

objectives such as time, cost, scope or quality, including both negative effects for

threats and positive effects for opportunities.

Probability and impact are assessed for each identified risk. Risks can be assessed in

interviews or meetings and the level of probability for each risk and its impact on

each objective is evaluated.

Explanatory details, including assumptions justifying the levels assigned, is also

recorded. Risk probabilities and impacts are rated according to the definitions given

in the risk management plan.

11.3.2.2. Probability and impact matrix

Risks can be prioritized for further quantitative analysis and response, based on their

risk rating. Evaluation of each risk’s importance and, hence priority for attention is

typically conducted using a lockup table or a probability and impact matrix.

The organization should determine which combinations of probability and impact

results in a classification of high, moderate or low risk.


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11.3.2.3. Risk data quality assessment

A qualitative risk analysis requires accurate and unbiased data if it is to be credible.

Analysis of the quality of risk data is a technique to evaluate the degree to which

the data about risks is useful for risk management. It involves examining the degree

to which the risk is understood and the accuracy, quality, reliability and integrity of

the data about the risk.

11.3.2.4. Risk categorization

Risks to the project can be categorized by sources of risk (e.g., using the RBS), the

area of the project affected (e.g. using the WBS), or other useful category (e.g.

project phase) to determine areas of the project most exposed to the effects of

uncertainty. Grouping risks by common root causes can lead to developing effective

risk responses.

11.3.2.5. Risk urgency assessment

Risks requiring near-term responses may be considered more urgent to address.

Indication of priority can include time to affect a risk response, symptoms and

warning signs and the risk rating.


Expert judgment is required to assess the probability and impact of each risk to

determine its location in the matrix. Experts generally are those having experience

with similar, recent projects.

11.3.3. Perform Qualitative Risk Analysis – Outputs


The information pertaining to risks is limited in risk register during the Risk

identification process. The risk register is updated with information from qualitative

Risk Analyses and the updated risk register is included in the project management

plan. Another document that gets updated in this process is the assumption log.

11.4. Perform Quantitative Risk Analysis

Quantitative Risk Analysis is performed on risks that have been prioritized by the Qualitative

Risk Analysis process as potentially and substantially impacting the project’s competing

demands. The Quantitative Risk Analysis process analyses the effect of those risk events


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and assigns a numerical rating to those risks. It also presents a quantitative approach

towards making a decisions in the presence of uncertainty.

Perform Quantitative Risk Analysis



Cost management plan

Schedule management plan

Risk register


Factors


assets

Data gathering and

representation techniques

Quantitative risk analysis

and modeling techniques

Expert judgment

Project Documents

Updates

11.4.1. Perform Quantitative Risk Analysis – Inputs


The risk management plan provides guidelines, methods, and tools to be used in

quantitative risk analysis.

11.4.1.2. Cost management plan

The cost management plan provides guidelines on establishing and managing risk

reserves.

11.4.1.3. Schedule management plan

The schedule management plan provides guidelines on establishing and managing

risk reserves.


The risk register is used as a reference point for performing quantitative risk

analysis.


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Enterprise environmental factors may provide insight and context to the risk analysis

such as industry studies of similar projects by risk specialists, and risk databases that

may be available from industry or proprietary sources.


The organizational process assets that can influence the Perform Quantitative Risk

Analysis process include information from prior, similar completed projects.

11.4.2. Perform Quantitative Risk Analysis – Tools and Techniques

11.4.2.1. Data gathering and representation techniques

Interviewing: Interviewing techniques are used to quantify the probability and

impact of risks on project objectives. Documenting the rationale of the risk

ranges is an important component of the risk interview, because it can provide

information on reliability and credibility of the analysis.

Probability Distribution: Continuous probability distribution represents the

uncertainty in values, such as durations of schedule activities and costs of

project components.

11.4.2.2. Quantitative risk analysis and modeling techniques

Commonly used techniques in Quantitative Risk Analysis include:

Sensitivity Analysis: Sensitivity analysis helps to determine the risks that have

the most potential impact on the project. It examines the extent to which the

uncertainty of each project element affects the objective being examined

when all other uncertain elements are held at their baseline values.

Expected Monetary Value Analysis: Expected Monetary Value (EMV) analysis

is a statistical concept that calculates the average outcome when the future

includes scenarios that may or may not happen (i.e., analysis under

uncertainty). A common use of this type of analysis is in decision tree analysis.

Decision Tree Analysis: Decision Tree Analysis is usually structured using a

decision tree diagram that describes a situation under consideration, and the

implications of each of the available choices and possible scenarios.

Modeling and simulation: A project simulation uses a model that translates

the uncertainties specified at a detailed level of the project into their

potential impact on project objectives. Simulations are typically performed

using the Monte Carlo technique.


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Subject matter expects internal or external to the organization, such as engineering

or statistical experts, validate data and techniques.

11.4.3. Perform Quantitative Risk Analysis – Outputs


The risk register is initiated in the Risk Identification process and updated in

Qualitative Risk Analysis. It is further updated in Quantitative Risk Analysis. The risk

register is a component of the project management plan. Updates include

Probabilistic analysis of the project, Probability of achieving cost and time

objectives, Prioritized list of quantified risks and Trends in quantitative risk analysis.

11.5. Plan Risk Responses

Plan Risk Response is the process of developing options and determining actions to enhance

opportunities and reduce threats to the project’s objective. It follows the Qualitative Risk

Analysis and Quantitative Risk Analysis processes. Risk Response Planning addresses the risks

by their priority, inserting resources and activities into the budget, schedule and project

management plan as needed.

Plan Risk Responses



Risk register

Strategies for negative

risks or threats

Strategies for positive risks

or opportunities

Contingent response

strategies

Expert judgment

Project management

plan updates

Project document

updates


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11.5.1. Plan Risk Responses – Inputs


Important components of the risk management plan include roles and

responsibilities, risk analysis definitions, risk thresholds for low, moderate, and high

risks, and the time and budget required to conduct Project Risk Management.


The risk register is first developed in the Risk Identification process, and is updated

during the Qualitative and Qualitative Risk Analysis processes. The Plan Risk

Response process may have to refer back to Identified risks, root causes of risks, lists

of potential responses, risk owners, symptoms, and warning signs in developing risk

responses.

11.5.2. Plan Risk Responses – Tools and Techniques

11.5.2.1. Strategies for negative risks or threats

There are four strategies typically deal with threats or risks that may have negative

impacts on project objectives if they occur. These strategies are:

Avoid: Risk avoidance involves changing the project management plan to

eliminate the threat posed by an adverse risk, to isolate the project objective

from the risk’s impact, or to relax the objective that is in jeopardy. Risks that

arise early in the project can be avoided by clarifying requirements, obtaining

information, improving communication, or acquiring expertise.

Transfer: Risk transference requires shifting the negative impact of a threat,

along with ownership of the response, to a third party. Transferring the risk

simply gives another party responsibility for its management. It does not

eliminates it.

Mitigate: Risk mitigation implies a reduction in the probability and/or impact of

an adverse risk event to an acceptable threshold. Taking early action to reduce

the probability and/or impact of a risk occurring on the project is often more

effective than trying to repair the damage after the risk has occurred. Where it

is not possible to reduce probability, a mitigation response might address the

risk impact by targeting linkages that determine the severity.

Accept: Risk acceptance involves the decision to acknowledge the risk and not

take any actions unless the risk occurs. This strategy is adopted where it is not

possible or cost-effective to address a specific risk in any other way.


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11.5.2.2. Strategies for positive risks or opportunities

There are four strategies typically deal with opportunities or risks that may have

positive impacts on project objectives if they occur. These strategies are:

Exploit: The exploit strategy may be selected for risks with positive impacts

where the organization wishes to ensure that the opportunity is realized. This

strategy seeks to eliminate the uncertainty associated with a particular upside

risk by ensuring the opportunity definitely happens.

Share: Sharing a positive risk involves allocating ownership to a third party

who is best able to capture the opportunity for the benefits of the project.

Enhance: This strategy modifies the “size of an opportunity by increasing

probability and/or positive impacts, and by identifying and maximizing key

drivers of these post-impact risks. Strategy for Both Threats and Opportunities.

Accept: Acceptance involves the decision to acknowledge the opportunity and

not take any actions unless the opportunity arises.

11.5.2.3. Contingent response strategies

Some responses are designed for use only if certain events occur. For some risks, it

is appropriate for the project team to make a response plan that will only be

executed under certain predefined conditions and if there is sufficient warning to

implement the plan. Events that trigger the contingency response, such as missing

intermediate milestones or gaining higher priority with a supplier, should be defined

and tracked.


Input from experts pertaining to the actions to be taken on a specific and defined

risk. Expertise may be provided by any group or person with specialized education,

knowledge, skill, experience, or training in establishing risk responses.

11.5.3. Plan Risk Responses – Outputs


Various components of the project management plan are updated to reflect the

changes in process, tolerance or behavior related to specific subsidiary area. Some

of the key components that gets updated are:

Schedule management plan: Changes in resource loading and leveling, and

schedule strategy.


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Cost management plan: Changes in cost accounting, tracking, and reports and

updates to the budget strategy and how contingency reserves are consumed.

Quality management plan: Changes in behavior related to requirements,

quality assurance, or quality control and updates to the requirements

documentation.

Procurement management plan: Alterations in the make-or-buy decision or

contract type(s) driven by the risk responses.

Human resource management plan: Changes in project organizational

structure and resource applications, staff allocation, as well as updates to the

resource loading.

Scope baseline: Modified or omitted work generated by the risk responses.

Schedule baseline: Changes in schedule baseline to reflect changes in Scope

baseline.

Cost baseline: Changes in schedule baseline to reflect changes in Scope

baseline.


When appropriate risk responses are chosen and agreed upon, they are included in

the risk register. Updates also include symptoms and warning signs of risk’s

occurrence.

11.6. Control Risks

Control Risk is the process of identifying, analyzing and planning for newly arising risks,

keeping track of the earlier identified risks and those on the watch List, reanalyzing existing

risks, monitoring trigger conditions for contingency plans, monitoring residual risks and

reviewing the execution of risk responses while evaluating their effectiveness.


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Control Risks



Risk Register


Work Performance reports

Risk reassessment

Risk audits

Variance and trend

analysis

Technical performance

measurement

Reserve analysis

Meetings

Work Performance

Information

Changes requests


updates



assets updates

11.6.1. Control Risks – Inputs

11.6.1.1. Project Management plan

The project management plan, which includes the risk management plan, provides

guidance for risk monitoring and controlling.


The risk register has key inputs that Include identified risks and risk owners, agreed

- upon risk responses, specific implementation actions, symptoms and warning signs

of risk, residual and secondary risks, a watch-list of low priority risks and cost

contingency reserves.


Work performance data includes project’s deliverables status, corrective actions

and performance reports are key inputs to Control Risk process.

11.6.1.4. Work Performance reports

Work performance reports provide information on project work performance such as

variance analysis, earned value data and forecasting that may influence the risk

management processes.


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11.6.2. Control Risks – Tools and Techniques

11.6.2.1. Risk reassessment

Project risk reassessments should be regularly scheduled to identify new risks,

reassessment of current risks and closing of the risks that are no longer valid.

11.6.2.2. Risk audits

Risk audits examine and document the effectiveness of risk responses in dealing with

identified risks and their root causes, as well as the effectiveness of the risk

management process.

11.6.2.3. Variance and trend analysis

Earned value analysis and other methods of project variance and trend analysis may

be used for monitoring overall project performance. Outcomes from these analyses

may forecast potential deviation of the project cost and schedule targets.

11.6.2.4. Technical performance measurement

Technical performance measurement compares technical accomplishments during

project execution to the project management plan’s schedule of technical

achievements.

11.6.2.5. Reserve analysis

Reserve analysis compares the amount of the contingency reserves remaining to the

amount of risk remaining at any time in the project in order to determine if the

remaining reserve is adequate.

11.6.2.6. Meetings

Project risk management can be an agenda item at periodic status meetings.

11.6.3. Control Risks – Outputs


Work performance information, as a Control Risks output, provides a mechanism to

communicate and support project decision making.


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11.6.3.2. Changes requests

Implementing contingency plans or workarounds sometimes results in a change

request. Change requests that may include corrective or preventive action plans are

prepared and submitted to the Perform Integrated Change Control process.


If the approved change requests have an effect on the risk management processes,

the corresponding component documents of the project management plan are

revised and reissued to reflect the approved changes.


The key document to be updated as an outcome of Control Risk process is Risk

Register. It may get updated with outcomes of risk reassessments, risk audits, and

periodic risk reviews. It may also contain result of project’s risk and risk response.


The risk management processes produce information that may be used for future

projects, and should be captured in the organizational process assets.


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Chapter 12: Project Procurement

Management


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12. Project Procurement Management

Project Procurement Management includes the processes necessary to purchase or acquire

products, services, or results needed from outside the project team.


Knowledge

Area



Monitoring

and

Controlling

Closing

12 Project

Procurement

Management

12.1 Plan Procurement Management

12.2 Conduct Procurements

12.3 Control Procurements

12.4 Close Procurements

12.1. Plan Procurement Management

Purpose of the Plan Procurement Management is to identify which project needs can best

be met by purchasing or acquiring products, services, or results outside the project

organization. This process involves consideration of whether, how, what, how much, and

when to acquire. When the project obtains products, services, and results required for

project performance from outside the performing organization, the processes from Plan

Procurement Management through Close Procurements are performed for each item to be

purchased or acquired.

Plan Procurement Management



Requirements

documentation

Risk register

Make-or-buy analysis

Expert judgment

Market Research

Meetings

Procurement management

plan

Procurement statements of

work


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Activity resource

requirements

Project schedule

Activity cost estimates

Stakeholder Register


factors


assets


(RFP/RFI)

Source selection criteria

Make-or-buy decisions

Change requests


12.1.1. Plan Procurement Management – Inputs


It can be composed of one or more subsidiary plans and other components. The

project management plan describes the need, justification, requirements, and

current boundaries for the project. These subsidiary plans include:

Project Scope Statement

WBS

WBS Dictionary


Requirements documentation captures the requirements that the project must meet

pertaining to stakeholder expectations and those requirements must be considered

during planning for procurement.


The risk register provides the list of risks, along with the results of risk analysis and

risk response planning.


Description of the resource types and number of resources required for each activity

in a work package is considered during plan procurement process since the assigned

resources and resource availability will significantly influence the procurement

decisions.


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12.1.1.5. Project schedule

It includes planned start & finish dates, durations, milestones, and resources for

overall project and planned start & finish dates for each activity.

12.1.1.6. Activity cost estimates


resources required to complete activities.

12.1.1.7. Stakeholder Register

The stakeholder register provides an exhaustive list of the key stakeholders who will

provide the requirements and it also captures their main expectations.


The enterprise environmental factors that can influence the Plan Procurement

Management process include:

Marketplace conditions

Products, services, and results that are available in the marketplace

Suppliers, including past performance or reputation

Terms and conditions

Unique local requirements.


Existing format and informal procurement related policies, procedures, guidelines

and management systems that are considered in developing the procurement

management plan and selecting the contract types to be used are provided by

organizational process assets.

There are different types of contracts for different purposes. Contract types

generally fall into one of the three broad categories:

Fixed Price or Lump Sum Contracts: The buyer and seller agree on a well-

defined deliverable for a set price. In this kind of contract, the biggest risk is

borne by the seller.

1) Firm Fixed Price Contracts (FFP)

2) Fixed Price Incentive Fee Contracts (FPIF)

3) Fixed Price Incentive Fee Contracts (FPIF)


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Cost-reimbursable contracts: All the costs the seller takes on during the

project are charged back to the buyer, thus the seller is reimbursed. Three of

the more common types of cost-reimbursable contracts are:

1) Cost Plus Fixed Fee (CPFF)

2) Cost Plus Incentive Fee (CPIF)

3) Cost Plus Award Fee (CPAF)

Time and Material contracts (T&M): This type of contract is a mix of fixed

price and cost reimbursable contract. The full amount of the material costs is

not known at the time the contract is awarded. This resembles a cost

reimbursable contract as the costs will continue to grow during the contract’s

life.

12.1.2. Plan Procurement Management – Tools and Techniques

12.1.2.1. Make-or-buy analysis

A make-or-buy analysis is a technique used to determine whether particular work

can best be accomplished by the project team or should be purchased from outside

sources. One of the key component to consider in make or buy analysis is cost. The

objective of make or buy analysis is whether it’s more cost effective to buy the

products and services or more cost effective for the organization to produce the

goods and services needed for the project. Available contract types are also

considered during the buy analysis. The risk sharing between the buyer and seller

determines the suitable contract types, while the specific contract terms and

conditions formalize the degree of risk being assumed by the buyer and seller.


Expert purchasing judgment can also be used to develop or modify the criteria that

will be used to evaluate seller proposals. Expert legal judgment may involve the

services of legal staff to assist with unique procurement issues, terms, and

conditions.

12.1.2.3. Market Research

Market research includes examination of industry and specific vendor capabilities.

12.1.2.4. Meetings


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Project manager, project team and stakeholders may need to conduct meetings with

potential bidders for exchange of additional information.

12.1.3. Plan Procurement Management – Outputs

12.1.3.1. Procurement management plan

How the procurement processes will be managed from developing procurement

documentation through contract closure is described in the procurement

management plan that can include:

Types of contracts to be used

Who will prepare independent estimates and if they are needed as evaluation

criteria

Actions that project management team can take on their own if the performing

organization has a procurement or purchasing department of their own.

Standardized procurement documents if needed

Coordinating procurement with other project aspects such as scheduling and

performance reporting

Constraints and assumptions that could affect planned purchases and

acquisitions

Handling the lead time required to purchase or acquire items from sellers and

coordinating them with the project schedule development

Setting the schedule dates in each contract for the contract deliverables and

coordinating with the schedule development and control processes.

Identifying pre-qualified selected sellers, if any.

Procurement metrics to be used to manage contracts and evaluate sellers.

Procurement management plan is a subsidiary component of the project

management plan that can be highly detailed or broadly framed and is based upon

the needs of the project, it can be formal or informal.

12.1.3.2. Procurement statements of work

The procurement statement of work for each contract is developed from the project

scope statement, WBS and WBS dictionary. It describes the procurement items in

sufficient detail to allow prospective sellers to determine if they are capable of

providing the item. Sufficient details can vary based on the items or the need of the


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buyer. A procurement SOW describes the product service or result to be supplied by

the seller. Information included in a procurement SOW can include specifications,

quantity desired, quality levels, performance data, period of performance, work

location and other requirements.

12.1.3.3. Procurement documents (RFP/RFI)

Procurement documents are used to solicit proposals from prospective sellers.

Different types of procurement documents may include request for information

(RFI), invitation for bid (IFB), request for proposal (RFP), request for quotation

(RFQ), tender notice, invitation for negotiation, and invitation for seller’s initial

response. Specific procurement terminology used may vary by industry and location

of the procurement.

12.1.3.4. Source selection criteria

Source selection criteria are developed and used to rate or score proposals. They

are often included as part of the procurement documents. Evaluation criteria can

be limited to purchase price if the procurement items is readily available from a

number of acceptable sellers. Purchasing price in this context includes both the cost

of the item and ancillary expenses such as delivery. Other selection criteria can be

identified and documented to support an assessment for a more complex product or

service. For example:

Understanding of need

Overall life-cycle cost

Technical capability

Management approach

Technical approach

Financial capability

Production capacity and interest

Business size and type

References

Intellectual property rights

Proprietary rights

12.1.3.5. Make-or-buy decisions

A make-or-buy analysis results in a decision of whether particular work can best be

accomplished by the project team or needs to be purchased from outside sources.


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Decisions taken during procurement planning can create the need for additional

change requests. Change requests are processed for review and disposition through

the Perform Integrated Change Control process.


A decision of procurement may require update in requirements documentation,

requirements traceability matrix and Risk register.

12.2. Conduct Procurements

Conduct Procurements is the process of obtaining seller responses, selecting a seller, and

awarding a contract. It provides alignment of internal and external stakeholder

expectations through established agreements.

Conduct Procurements


Procurement management

plan


Source selection criteria

Seller proposals

Project documents

Make-or-buy decisions

Procure Statement Of Work


assets

Bidder conferences

Proposal evaluation

techniques

Independent estimates

Expert judgment

Advertising


Procurement

negotiations

Selected sellers

Agreements

Resource calendars

Change requests


updates



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12.2.1. Conduct Procurements – Inputs

12.2.1.1. Procurement management plan

The procurement management plan describes how the procurement processes will

be managed from developing procurement documentation through contract closure.

12.2.1.2. Procurement documents

Procurement documents provide an audit trail for contracts and other agreements.

12.2.1.3. Source selection criteria

Source selection criteria can include information on the supplier’s required

capabilities, capacity, delivery dates, product cost, life-cycle cost, technical

expertise, and the approach to the contract.

12.2.1.4. Seller proposals

Seller proposals, received in response form the basic information that will be used

by an evaluation body to select one or more successful bidders (sellers).

12.2.1.5. Project documents

Project documents that are often considered include the risk-related contract

decisions included within the risk register.

12.2.1.6. Make-or-buy decisions

Organizations procuring goods or services analyze the need of buying products versus

making the items themselves.

12.2.1.7. Procure Statement Of Work

The procurement statement of work provides suppliers with a clearly stated set of

goals, requirements, and outcomes from which they can provide a quantifiable

response.



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Listings of prospective and previously qualified sellers, information on relevant past

experience with sellers and prior agreements can be an important input in

conducting the procurement.

12.2.2. Conduct Procurements – Tools and Techniques

12.2.2.1. Bidder conferences

Bidder conferences are meetings with prospective sellers prior to preparation of a

bid or proposal and to ensure that all prospective sellers have a clear, common

understanding of the technical and contractual requirements. Response to questions

can be incorporated into the procurement requirements as amendments. All

potential sellers are given equal standing during this initial buyer and seller

interaction to produce the best bid.

12.2.2.2. Proposal evaluation techniques

A formal evaluation review process is defined by the buyer’s procurement policies.

The evaluation committee will make their selection for approval by management

prior to the award.

12.2.2.3. Independent estimates

The procuring organization may elect to either prepare its own independent

estimate, or have an estimate of costs prepared by an outside professional

estimator, to serve as a benchmark on proposed responses.


Expert judgment may be used in evaluating seller proposals. This can include

expertise from functional disciplines such as contracting, legal, finance, accounting,

engineering, design, research, development, sales, and manufacturing.

12.2.2.5. Advertising

Existing lists of potential sellers can be expanded by placing advertisements in

general circulation publications such as selected newspapers or in trade

publications. Some government jurisdictions require public advertising of certain

types of procurement items, and most government jurisdictions require public

advertising or online posting of pending government contracts.


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Procurements involve defining a need in such a way that vendors can bring value

through their offerings. To ensure that the need can be and is met, analytical

techniques can help organizations identify the readiness of a vendor to provide the

desired end state, determine the cost expected to support budgeting, and avoid cost

overruns due to changes.

12.2.2.7. Procurement negotiations

Procurement negotiations clarify the structure, requirements, and other terms of

the purchases so that mutual agreement can be reached prior to signing the

contract. The project manager may not be the lead negotiator on procurements.

The project manager and other members of the project management team may be

present during negotiations to provide assistance, and, if needed, to add

clarification of the project’s technical, quality, and management requirements.

12.2.3. Conduct Procurements – Outputs

12.2.3.1. Selected sellers

The selected sellers are those whose proposals have been reviewed using the

evaluation criteria and have been judged to be in a competitive range.

12.2.3.2. Agreements

An agreement is a legal relationship subject to remedy in the courts that is awarded

to each selected seller. It can be in the form of a complex document or a simple

purchase order. Regardless of the document’s complexity, an agreement is a

mutually binding legal agreement that obligates the seller to provide the specified

products, services or results and obligates the buyer to pay the seller.


The quantity and availability of the resources and those dates on which each specific

resource can be active or idle are documented.


Outcome of the conduct procurement process may result in changes in scope,

schedule or cost baselines of the project. Change request processed for review and

disposition through the Perform Integrated Change Control process.


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Elements of the project management plan that may be updated include:

Cost baseline

Scope baseline

Schedule baseline

Communications management plan

Procurement management plan


Project documents that may be updated include:


Requirements traceability documentation

Risk register


12.3. Control Procurements

Control Procurements is the process of managing relationships between buyer and seller,

monitoring contract performance, and making changes and corrections to contracts as

appropriate.

Control Procurements




Agreements

Approved change requests

Work Performance reports

Work performance Data

Contract change

control system

Procurement

performance reviews

Inspections and audits

Performance reporting

Payment systems

Claims administration

Work Performance

Information

Change requests


updates

Project documentation

Update


assets updates


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Records management

system

12.3.1. Control Procurements – Inputs


The project management plan describes how the procurement processes will be

managed from developing procurement documentation through contract closure.


Procurement documents contain complete supporting records for administration of

the procurement processes; this includes procurement contract awards and the

statement of work.

12.3.1.3. Agreements

Agreements are understandings between parties, including understanding of the

duties of each party.

12.3.1.4. Approved change requests

Approved change requests can include modifications to the terms and conditions of

the contract, including the procurement statement of work, pricing, and

descriptions of the products, services, or results to be provided.

12.3.1.5. Work Performance reports

Seller performance-related documentation including technical documentation and

work performance information.

12.3.1.6. Work performance Data

Work performance data includes, the extent to which quality standards are being

satisfied, the costs that have been incurred or committed and identification of the

seller invoices that have been paid.

12.3.2. Control Procurements – Tools and Techniques


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12.3.2.1. Contract change control system

A contract change control system defines the process by which the procurement can

be modified.

12.3.2.2. Procurement performance reviews

The objective of procurement performance review is to identify performance

successes or failures, progress with respect to the procurement statement of work

and non-compliance to the agreement that allows buyer to quantify the seller’s

demonstrated ability or inability to perform work. A procurement performance

review is a structured review of seller’s progress to delivery project scope and

quality within cost and on schedule as compared to the agreement.

12.3.2.3. Inspections and audits

Inspections and audits can be conducted during execution pf the project to identify

any weaknesses in the seller’s work process or deliverables.

12.3.2.4. Performance reporting

Performance reporting provides management with information about how

effectively the seller is achieving the contractual objectives. It is integrated into

project performance reporting.

12.3.2.5. Payment systems

The payment system includes appropriate reviews and approvals by the project

management team. Payments are made in accordance with the terms of the contract

by accounts payable system of the buyer. For large projects with many or complex

procurement requirements, the project can develop its own payment system.

12.3.2.6. Claims administration

Those requested changes where the buyer and seller cannot agree on compensation

for the change, or cannot agree that a change has even occurred are called as

contested changes and constructive changes. These changes are variously called

claims, disputes or appeal. Claims are documented, processed, monitored and

managed without the contract lifecycle usually in accordance with the terms of the

contract.

12.3.2.7. Records management system


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A records management system is used by the project manager to manage contract

documentation and records. It specifies the set of processes, related control

functions, and automation tools that are consolidated and combined into a whole as

part of the project management information system.

12.3.3. Control Procurements – Outputs


Work performance information provides a basis for identification of current or

potential problems to support later claims or new procurements. By reporting on the

performance of a vendor, the organization increases knowledge of the performance

of the procurement, which supports improved forecasting, risk management, and

decision making.


Control Procurements process may result in submitting change requests to the

project management plan, its subsidiary plans, and other components, such as the

cost baseline, schedule baseline, and procurement management plan.


Elements of the project management plan that may be updated include Procurement

management plan, Schedule and Cost baselines.

12.3.3.4. Project documentation Update

Project documents that may be updated are procurement documentation with all

supporting schedules, requested unapproved contract changes, and approved change

requests.


Elements of the organizational process assets that may be updated include:

Correspondence

Payment schedules and requests

Seller performance evaluation documentation

12.4. Close Procurements


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Close Procurements addresses each agreement applicable to the project or a project phase.

It supports the Close Project or phase process as it involves verification that all work and

deliverables were acceptable. It also involves administrative activities, such as updating

records to reflect final results and archiving such information for future use.

Close Procurements



Procurement documentation

Procurement audits

Procurement

Negotiations

Records management

system

Closed procurements


assets updates

12.4.1. Close Procurements – Inputs


The project management plan contains the procurement management plan, which

provides the details and guidelines for closing out procurements.

12.4.1.2. Procurement documentation

Information on contract schedule, scope, quality, and cost performance along with

all contract change documentation, payment records, and inspection results are

collated, indexed and filed to close the procurements.

12.4.2. Close Procurements – Tools and Techniques

12.4.2.1. Procurement audits

The procurement audit is a structured review to identify successes and failures that

warrant recognition in the preparation or administration of other procurement

contracts on the project.

12.4.2.2. Procurement Negotiations

The final equitable settlement of all outstanding issues, claims, and disputes is done

through negotiations. Whenever settlement cannot be achieved through direct


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negotiation, some form of alternative dispute resolution (ADR) including mediation

or arbitration may be explored.

12.4.2.3. Records management system

A records management system is used by the project manager to manage contract

and procurement documentation and records.

12.4.3. Close Procurements – Outputs

12.4.3.1. Closed procurements

The buyer provides the seller with formal written notice that the contract has been

completed. Requirements for formal procurement closure are defined in the terms

and conditions of the contract and are included in the procurement management

plan.


At end of the procurement, a complete set of indexed contract documentation is

archived. It also includes lessons learned and process improvement

recommendations to improve the future projects.


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Chapter 13: Project Stakeholders

Management


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13. Project Stakeholders Management

Project Stakeholder Management includes the processes required to identify the people,

groups, or organizations that could impact or be impacted by the project, to analyze

stakeholder expectations and their impact on the project, and to develop appropriate

management strategies for effectively engaging stakeholders in project decisions and

execution.


Knowledge

Area



Controlling Closing

13 Project

Stakeholders

Management

13.1 Identify Stakeholders

13.2 Plan StakeholdersManagement

13.3 Manage Stakeholders Engagement

13.4 Control Stakeholders Engagement

13.1. Identify Stakeholders

Identify Stakeholders is the process of identifying the people, groups, or organizations that

could impact or be impacted by a decision, activity, or outcome of the project, analyzing

and documenting relevant information regarding their interests, involvement,

interdependencies, influence, and potential impact on project success.

Identify Stakeholders


Project charter



factors


assets

Stakeholder analysis

Expert judgment

Meetings



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13.1.1. Identify Stakeholders – Inputs

13.1.1.1. Project charter

The project charter provide key inputs about internal and external stakeholders

related with the project and affected by the result or the execution of the project,

such as project sponsor(s), customers, team members, groups and departments

participating in the project, and other people or organizations affected by the

project.


Procurement documents can provide important inputs if the project is the result of

a procurement activity. Both the parties involved in the procurement key project

stakeholders.


Organizational culture and structure, global, regional or local trends, and practices,

or industry standards are the environmental factors that can influence the identify

stakeholders process.


Organizational process assets can provide stakeholders register templates and

lessons learned from previous projects.

13.1.2. Identify Stakeholders – Tools and Techniques

13.1.2.1. Stakeholder analysis

Stakeholder analysis is systematic gathering and analyzing of information to

determine whose interests should be taken into account in a project. Project

manager uses stakeholder analysis to assess interests, positions, alliances, and

importance given to the project by such stakeholders.

Stakeholder analysis generally follows the steps described below:

Identify all potential project stakeholders

Analyze the potential impact or support each stakeholder could generate

Assess how key stakeholders are likely to react or respond in various

situations

There are multiple classification models used for stakeholders analysis, such as:


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Grouping the stakeholders based on their power and interest

Grouping the stakeholders based on their power and influence

Grouping the stakeholders based on their influence and impact

Describing classes of stakeholders based on their power, urgency, and

legitimacy


To ensure comprehensive identification and listing of stakeholders, judgment and

expertise should be sought from groups or individuals with specialized training or

subject matter expertise.

13.1.2.3. Meetings

Project team can meet to develop an understanding of major project stakeholders,

and to exchange and analyze information about roles, interests, knowledge, and the

overall position of each stakeholder in the project.

13.1.3. Identify Stakeholders – Outputs

13.1.3.1. Stakeholder register

Output of the Identify Stakeholders process is the stakeholder register which

contains following information for each stakeholder in the register:

Identification information

Assessment information (Major requirements, main expectations, potential

influence in the project)

Stakeholder classification (Internal/external, supporter/neutral/resistor,

etc.)

The stakeholder register should be consulted and updated on a regular basis, as

stakeholders may change throughout the life cycle of the project.

13.2. Plan Stakeholder Management

Plan Stakeholder Management is the process of developing appropriate management

strategies to effectively engage stakeholders throughout the project life cycle, based on

the analysis of their needs, interests, and potential impact on project success.


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Plan Stakeholder Management





factors


assets

Expert Judgment

Meetings


Stakeholders Management

Plan


13.2.1. Plan Stakeholder Management – Inputs


The information used for the development of the stakeholder management plan

includes:

Description of how work will be executed to accomplish the project objectives

Description of how human resources requirements will be met and how roles

and responsibilities, reporting relationships

Change management plan

Need and techniques for communication among stakeholders.


Stakeholder register contains following information for each stakeholder in the

register:

Identification information

Assessment information (Major requirements, main expectations, potential

influence in the project)

Stakeholder classification (Internal/external, supporter/neutral/resistor, etc.)

The stakeholder register provides the information needed to plan appropriate ways

to engage project stakeholders.


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All enterprise environmental factors are used as inputs to this process, because the

management of stakeholders should be adapted to the project environment.


All organizational process assets are used as inputs for the Plan Stakeholder

Management process. Of these, lessons learned database and historical information

are of particular importance, because they provide insights on previous stakeholder

management plans and their effectiveness.

13.2.2. Plan Stakeholder Management – Tools and Techniques


Based on the project objectives, the project manager should apply expert judgment

to decide upon the level of engagement required at each stage of the project from

each stakeholder. Judgment and expertise should be sought from groups or

individuals with specialized training or subject matter expertise or insight into the

relationships within the organization.

13.2.2.2. Meetings

Project team can meet to discuss, review or develop appropriate strategies to

effectively manage and engage major project stakeholders.


The current engagement level of all stakeholders needs to be compared to the

planned engagement levels required for successful project completion. The

engagement level of the stakeholders can be classified as follows:

Unaware: Unaware of project and potential impacts

Resistant: Aware of project and potential impacts and resistant to change

Neutral: Aware of project yet neither supportive nor resistant

Supportive: Aware of project and potential impacts and supportive to change

Leading: Aware of project and potential impacts and actively engaged in

ensuring the project is a success.


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13.2.3. Plan Stakeholder Management – Outputs

13.2.3.1. Stakeholders Management Plan

The stakeholder management plan is a component of the project management plan

that defines the strategies required to effectively engage stakeholders. The

stakeholder management plan can provide Stakeholder communication

requirements, Information to be distributed to stakeholders, Information to be

distributed to stakeholders.


Plan Stakeholders Management can result in updating project schedule and

stakeholders register.

13.3. Manage Stakeholder Engagement

Managing stakeholders refers to effectively managing communications to satisfy the needs

of, and resolve Issues with project stakeholders. Actively managing stakeholders increases

the likelihood that the project will not veer off track due to unresolved stakeholders issues.

Manage Stakeholder Engagement


Stakeholder Management

Plan

Communications

Management Plan

Change Log


assets

Communication

methods

Interpersonal Skills

Management Skills

Issue Log

Change Requests


Updates



Assets Updates

13.3.1. Manage Stakeholder Engagement – Inputs

13.3.1.1. Stakeholder Management Plan

The stakeholder management plan provides guidance on how the various

stakeholders can be best involved in the project. The stakeholder management plan

provides the understanding of stakeholder’s goals, objectives and level of

communication required during the project.


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The communication requirements of the stakeholders are documented in the

communications management plan.

13.3.1.3. Change Log

A change log is used to document changes that occur during a project. These

changes—and their impact on the project in terms of time, cost, and risk—are

communicated to the appropriate stakeholders.


Organizational communication requirements and historical information about

previous projects are some of the key inputs team need to consider while managing

the stakeholders engagement.

13.3.2. Manage Stakeholder Engagement – Tools and Techniques

13.3.2.1. Communication methods






information.




13.3.2.2. Interpersonal Skills

Interpersonal skills are of paramount important in order to be successful In today’s

competitive, mechanical, fast-phased, demanding environment, coupled with a

diverse workforce, call for significant amounts of people management skills, e.g.:






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13.3.2.3. Management Skills

The project manager applies management skills to coordinate and harmonize the

group toward accomplishing the project objectives. For example:

Facilitate consensus toward project objectives

Influence people to support the project

Negotiate agreements to satisfy the project needs

Modify organizational behavior to accept the project outcomes.

13.3.3. Manage Stakeholder Engagement – Outputs

13.3.3.1. Issue Log

An issue log can be used to document and monitor resolution of issue identified

during managing the stakeholders.


Managing stakeholder engagement may result in a change request to the project

management plan. It may also include corrective or preventive actions to the project

itself or to the interaction with the impacted stakeholders, as appropriate.


Elements of the project management plan that may be updated is the stakeholder

management plan when new or changed stakeholders requirements are identified.


Stakeholder register is one of the project documents that may get updated as

information on stakeholders change, when new stakeholders are identified, or if

registered stakeholders are no longer involved in or impacted by the project.


The organizational process assets that may be updated include:


Project reports


Project records




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13.4. Control Stakeholder Engagement

Control Stakeholder Engagement is the process of monitoring overall project stakeholder

relationships and adjusting strategies and plans for engaging stakeholders.

Control Stakeholder Engagement



Issue log


Project Documents

Information

Management Systems

Expert Judgment

Meetings

Work Performance

Information

Change requests


updates



Assets Update

13.4.1. Control Stakeholder Engagement – Inputs


Project Management Plan is used to develop the stakeholder management plan. It

provides input important to Control Stakeholders Engagement like how work will be

executed to accomplish the project objectives, how human resources requirements

will be met, how roles and responsibilities, reporting relationships, and staffing

management will be addressed and structured for the project. It also provide the

techniques for communication among stakeholders.

13.4.1.2. Issue log

An issue log can be used to document and monitor resolution of issue and who is

responsible for resolving specific issues by a target date.





each process area for detailed analysis.


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Multiple project documents originating from initiation, planning, execution, or

control processes may be used as supporting inputs for controlling stakeholder

engagement.

13.4.2. Control Stakeholder Engagement – Tools and Techniques








Based on the project objectives, the project manager should apply expert judgment

to decide upon the level of engagement required at each stage of the project from

each stakeholder. Judgment and expertise should be sought from groups or

individuals with specialized training or subject matter expertise or insight into the

relationships within the organization.

13.4.2.3. Meetings

Project team can meet to develop an understanding of major project stakeholders,

and to exchange and analyze information about roles, interests, knowledge, and the

overall position of each stakeholder in the project.

13.4.3. Control Stakeholder Engagement – Outputs


The work performance information is the performance data collected from various

controlling processes, analyzed in context, and integrated based on relationships

across areas.


Analysis of project performance and interactions with stakeholders often generates

change requests in the form of recommended corrective or preventive actions. These

change requests are processed through the Perform Integrated Change Control

process


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As stakeholders engage with the project the overall effectiveness of the stakeholder

management strategy can be evaluated. As needed changes in approach or strategy

are identified, affected sections of the project management plan may need to be

updated to reflect these changes.


Project team may need to update Stakeholder register as stakeholder’s information

may change due to addition of new stakeholders or when existing stakeholders no

longer involved in the project. It may also require updates to issue log as new issues

may be identified and current issues may get resolved during the process.

13.4.3.5. Organizational Process Assets Update

The organizational process assets that may be updated include:


Project reports


Project records



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