Project Management Professional
PMP®
Ahmad H. Maharma
Master Of Engineering Management
PMP®,RMP®
Ahmad Maharma PMBOK 5th Edition 2
Getting Acquainted
• Name
• Title
• Why are you here?
• What do you want to learn from this course?
• A little known fact
Ahmad Maharma PMBOK 5th Edition 3
Ground Rules
• Material & Book(s)
• Time & Breaks
• Smoking
• Mobile Phones
• Side Talks
• Respect
• Ask, ask, ask
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How This Training is Delivered
• Lectures
• Exercises
• Group Work
• Discussions
• Quizzes
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Basic definitions
• Non-for-profit Professional Association
• Started in 1969
• Over 400,000 members worldwide
• In more than 160 countries
PMI
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PMI’s Membership
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PMPs Certified
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What is PMP®?
• A Credential initiated by PMI in 1984 “Project Management Professional”
• Demonstrate to employers, clients and colleagues that project managers possess project management knowledge, experience and skills to bring projects to successful completion
• The most recognized credential in project management worldwide
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Getting CertifiedTitle PMP®
Full Name Project Management Professional
Project Role Leads and directs project teams
Eligibility Requirements Candidate holds a baccalaureate university degree.
4,500 hours of Project Management Experience.
36 non overlapping months of Project Management Experience.
At least three years of project experience within last six years of experience.
35 contact hours of Project Management training including all nine knowledge areas of project management
Exam 200 questions, 4 hours
Ahmad Maharma PMBOK 5th Edition 10
PMP Exam
• 4 Hours Web-Based
• 200 Questions
• 175 Questions Counted
• Passing Score: 107
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PMP Exam Structure
Area No. of Questions %
Initiation 26 13
Planning 48 24
Execution 60 30
Monitoring & Controlling 50 25
Closing 16 8
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PMP Exam
• Exam tests:
• 1- Theoretical Knowledge (PMBOK)
• 2- Personal Skills
• 3- Practical Experience
• 4- Ethics & professional responsibility
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Project Management Bodyof Knowledge (PMBOK)
• Identifies that subset of the PMBOK that is generally recognized as a good practice
• “Generally Recognized” means the knowledge and practice described are applicable to most projects most of the time. There is consensus about their value and usefulness.
• “Good Practice” means there is a general agreement that the application of these skills, tools, and techniques can enhance the chances of success over a wide range of projects.
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Project Management Professional
PMP®
Project Management Fundamentals
What is a Project?
“A Temporary endeavor undertaken to create a unique Product, service, or result”
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1- Temporary
• Definite Beginning (T-1)& End (T4)
• End reached when:
• Objectives reached
• Objectives cannot be met
• Need for project no longer exists
– Projects are not “ongoing” efforts
– Does not generally apply to outcomes
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2- Unique
• Products
• Capability
• Results
• Repetitiveness does not change the fundamental uniqueness of the project
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3- Progressively Elaborative
• Developing in steps, and continuing by increments.
• Plans get improved and clearer as more information is obtained and estimates are more accurate.
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Projects Vs. Operation
20
Operation Project
Repeating process One of a kind, temporary
process
No clear beginning or ending Clear beginning and ending
Same output created each
time the work is performed
Output is unique
Everyone in work group
performs similar functions
Requires multi-disciplined team
Ahmad Maharma PMBOK 5th Edition
What is Project Management?
• Project management is the application of knowledge, skills, tools and techniques to project activities to meet project requirements. It includes:
Identifying requirements
Establishing clear & achievable objectives
Balancing the competing demands for quality, scope, time and cost
Adapting the specifications, plans & approach
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What Project Management is Not?
• Managing or buying a software.
• Preparing a schedule or a bar chart
• Preparing progress reports showing accomplishments
• Coordinating work and communicating with stakeholders
• For Engineers ONLY
• Project Management is a science and art
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Project Management Context
• Programs & Program Management
• Portfolios & Portfolio Management
• Project Management Office - PMO
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Program Management
• A program is a group of related projects managed in a coordinated way to obtain benefits and control that cannot be achieved from managing them individually.
• Program Management is the centralized coordinated management of a program to achieve the program’s strategic objectives and benefits.
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Program Management
Project D
Project C
Project B
Project A
Objective (s)
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Portfolio management
• A portfolio represents a collection of active programs, projects and other that are grouped together to facilitate effective management of that work to meet strategic business objectives.
• Portfolio management, therefore, is the centralized management of one or more portfolios in order to achieve specific strategic business objectives.
• Focuses on ensuring that projects and programs are reviewed to prioritize resource allocation, and that the management of the portfolio is consistent with and aligned to organizational strategies.
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Portfolio Management
Project (E)
Program A
Project (F)
Operations
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Project Management Offices (PMOs)
• An organizational unit to centralize and coordinate the management of projects under its domain
• The PMO can be understood as :
• “The organizational entity, staffed with skilled professional personnel, that provides services in core and
supporting areas during the planning and execution of a project/Program”
• Can have a wide range of authorities and responsibilities
• Takes one of 3 roles:
• 1- Providing policies, methodologies and templates
• 2- Provide support and guidance
• 3- Provide managers for projects, and coordinate managing them
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PMO Types
• There are Three types of PMOs that may exist in an organization:
Supportive PMO
Controlling PMO
Directive PMO
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Supportive PMO
• The most common type of PMO
• Its purpose is to empower project managers and teams to deliver their projects more successfully
• It doesn't control or direct projects, instead it focuses on supporting projects through training, mentoring, administration and reporting.
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Controlling PMO
• Offers controlling services (such as project reviews, audits,
assessments and governance), in addition to the supporting
services to get project back on track
• Can influence project delivery
• It can also enforce standards, implement processes and
manage overall project risk
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Directive PMO
• This is the least common, but sometimes most effective type of
PMO
• It offers directive services, where it does not just support and
control projects, but also responsible for actually running them
• Each of the Project Managers report to the PMO Director as
their supervisor. This helps to “corral” all of the project work
within an organization, to one department
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Project Management Offices (PMOs)
• The PMO may:
Manage the interdependencies between projects
Help provide resources
Terminate projects
Monitor compliance with organizational processes
Help gather lessons learned
Be more heavily involved during the project initiation
Be part of the change control board
Be a stakeholder
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PMOs-Requirements for Success
1. Role should be clearly defined
2. Only one role, don’t try to do it all
3. Commitment and support of top management
4. All should be PMPs
5. Improve project performance through the use of proper
processes and techniques
6. The repercussions of failure!!
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The Role of Project Manager
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Knowledge
What the Project Manager knows about Project Management.
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Performance
What the Project Manager is able to do or accomplish while applying his/ her project management knowledge
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Personal
How the Project Manager behaves when performing the project or related work.
Encompasses: Attitude Core personality characteristics Leadership
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Project Manager Interpersonal Skills
Project Manager
Interpersonal Skills
Leadership
Team Building
Motivation
Com-munication
Influencing
Decision making
Political & cultural
awareness
Negotiation
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PMBOK Reading
Chapter 1
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Project Management Professional
PMP®
Project Management Framework
Project Lifecycle A collection of generally sequential and sometimes overlapping project phases
Phases name and number are determined by:
Management
Nature of the project
Control requirements
Area of application
Can be determined or shaped by the unique aspects of the organization, industry or technology
Can be documented by a methodology
• Provides the basic framework for managing the project
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Project Lifecycle Vs. Product Lifecycle
Product lifecycle outlives project lifecycle
Project lifecycle is part of product lifecycle
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Cost & Staffing Level
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The project through its lifecycle
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Project Phases
• Divisions within a project where extra control is needed to effectively manage the completion of a major deliverable.
• A deliverable is a measurable, verifiable work product.
• Each phase ends with a deliverable
• Number and structure of phases is determined by the organization’s control requirements
• Some organizations have established policies that standardize all projects.
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Project Lifecycle- Sequential Phases
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Project Lifecycle- Overlapping Phases
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Project Lifecycle-The Spiral Model
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TTM deliverables
• Marketing Deliverables
• Customer Journey Deliverables
• Financial & regulatory Deliverables
• ITN Deliverables
• Business processes Deliverables
• Sourcing Deliverables
• Project Deliverables
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Stakeholders• Persons or organizations who are actively involved in the
project, or whose interests maybe positively or negatively affected by the performance or completion of the project
Project Stakeholders:
Sponsors
Customers/ Users
Vendors/ Suppliers
Project Manager
Project Management Team
Project Team
PMOAhmad Maharma PMBOK 5th Edition 53
Stakeholders
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5 Steps to Managing Stakeholders
• Identify ALL of them
• Determine ALL their requirements
• Determine their expectations
• Communicate with them
• Manage their influence
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Organizational influence
Projects don’t operate in vacuum, they are influenced by organizational:
• Culture
• Style
• Structure
Organization’s degree of project management maturity and systems can influence the project
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Functional Organization
Also known as “Silo” organization
Functional managers control resources
Communication happens “vertically”
Good for operation-oriented organizations, such as banks, government
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Functional Organization
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Advantages & Disadvantages
Advantages
• Clear Authority• Career
Development• Controlled
Disadvantages
• Poor Coordination
• No Project Accountability
• High Politics
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Projectized Organization
Also known as “No home”
Systematic approach to project management
Well defined project management methodology & lifecycle
Does not support learning & career development
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Projectized Organization
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Advantages & Disadvantages
Advantages
• Effective Communication
• Project Driven Coordination
• More focused
Disadvantages
• High Risk• Poor Resource
Utilization• “No Home”
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Matrix organization
Also known as “Two Bosses”
Has three types:
Weak matrix
Balanced matrix
Strong matrix
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Weak Matrix
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Balanced Matrix
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Strong Matrix
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Advantages & Disadvantages
Advantages
• Project Manager Assigned.
• Communication and Coordination
• Visible Project Objectives
Disadvantages
• Two Bosses• Competition of Priorities• Hard to Control• Tough Resource
Allocation• Complex Communication
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Organizational Influences on Project Management
PMBOK 5th Edition 68Ahmad Maharma
Project Management Process Groups
Monitoring &
Controlling Processes
Closing
Processes
Initiation
Processes
Planning
Processes
Execution
Processes
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Project Management Process Groups
A version of Deming’s Cycle
Plan – Do – Check- Act (PDCA)
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Interaction Between Process Groups
Level of
Process
Interaction
Initiation
Process
Group
Planning
Process
Group
Execution
Process
Group
Monitoring &
Control Process
Group
Closing
Process
Group
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72
Project Phases
• All projects are divided into phases
• All phases together are known as the Project Life Cycle
• Each phase is marked by completion of Deliverables
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Project Management Framework
• The PMBOK’s 10 Knowledge areas
Time
Management
Cost
Management
Scope
Management
Quality
ManagementHR Management
Communication
Management
Procurement
Management
Integration
Management
Stakeholder
Management
Risk
Management
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PM Knowledge Areas & Process Groups 47 processesPM Process Groups
Knowledge Area
Processes
Initiating Process
Group
Planning Process Group Executing Process Group Monitoring & Controlling Process
Group
Closing
Process Group
Project Management
Integration
Develop Project
Charter
Develop Project Management
Plan
Direct and Manage Project
Execution
Monitor and Control Project Work
Integrated Change Control
Close Project
Project Scope
Management
Plan Scope Management
Collect requirements
Define Scope
Create WBS
Validate Scope
Control Scope
Project Time
Management
Plan schedule Management
Define Activity
Sequence Activity
Estimating Resource
Estimating Duration
Develop Schedule
Schedule Control
Project Cost
Management
Plan Cost Management
Estimating Cost
Budgeting Cost
Control Cost
Project Quality
Management
Quality Planning Perform Quality Assurance Perform Quality Control
Project HR
Management
Plan HR Management Acquire Project Team
Develop Project Team
Manage Project Team
Project
Communications
Management
Plan Communications Distribute Information Performance Reporting
Project Risk
Management
Plan Risk Management
Risk Identification
Qualitative / Quantitative Risk
Analysis
Risk Response Planning
Risk Monitoring and Control
Project Procurement
Management
Plan procurement Conduct procurement Administer Contract Close
procurement
Project Stakeholder
Management
Identify Stakeholders Plan stakeholder Management Manage stakeholders
expectations
Control stakeholder
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Project Scope Management
Knowledge
Area
Process
Initiating Planning ExecutingMonitoring &
ControlClosing
Scope
Plan scope Management
Collect Requirements
Define Scope
Create WBS
Validate Scope
Control Scope
Enter phase/
Start project
Exit phase/
End project
Initiating
Processes
Closing
Processes
Planning
Processes
Executing
Processes
Monitoring &
Controlling Processes
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Project Time Management
Knowledge
Area
Process
Initiating Planning ExecutingMonitoring &
ControlClosing
Time
Plan schedule Management
Define Activity
Sequence Activity
Estimating Resource
Estimating Duration
Develop Schedule
Control Schedule
Enter phase/
Start project
Exit phase/
End project
Initiating
Processes
Closing
Processes
Planning
Processes
Executing
Processes
Monitoring &
Controlling Processes
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Project Cost Management
Knowledge
Area
Process
Initiating Planning ExecutingMonitoring &
ControlClosing
Cost
Plan Cost management
Estimating Cost
Determine Budget Control Costs
Enter phase/
Start project
Exit phase/
End project
Initiating
Processes
Closing
Processes
Planning
Processes
Executing
Processes
Monitoring &
Controlling Processes
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Project Quality Management
Knowledge
Area
Process
Initiating Planning Executing Monitoring & Contol Closing
CostPlan Quality
Management
Perform Quality
Assurance control Quality
Enter phase/
Start project
Exit phase/
End project
Initiating
Processes
Closing
Processes
Planning
Processes
Executing
Processes
Monitoring &
Controlling Processes
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Project Human Resource Management
Knowledge Area
Process
Initiating Planning ExecutingMonitoring &
ControlClosing
Human
ResourcePlan Human Resource
Management
Acquire Project Team
Develop Project Team
Manage Project Team
Enter phase/
Start project
Exit phase/
End project
Initiating
Processes
Closing
Processes
Planning
Processes
Executing
Processes
Monitoring &
Controlling Processes
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Project Communication Management
Knowledge Area
Process
Initiating Planning ExecutingMonitoring &
ControlClosing
CommunicationPlan
Communication
Management
Manage CommunicationsControl
Communications
Enter phase/
Start project
Exit phase/
End project
Initiating
Processes
Closing
Processes
Planning
Processes
Executing
Processes
Monitoring &
Controlling Processes
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Project Risk Management
Knowledge
Area
Process
Initiating Planning Executing Monitoring & Control Closing
Risk
Plan Risk Management
Identify Risk
Perform Qualitative Risk Analysis
Perform Quantitative Risk Analysis
Plan Risk Response
Control Risks
Enter phase/
Start project
Exit phase/
End project
Initiating
Processes
Closing
Processes
Planning
Processes
Executing
Processes
Monitoring &
Controlling Processes
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Project Procurement Management
Knowledge Area
Process
Initiating Planning ExecutingMonitoring &
ControlClosing
Procurement
Plan Procurement
Management
Conduct
Procurement
Control
Procurement
Close Procurement
Enter phase/
Start project
Exit phase/
End project
Initiating
Processes
Closing
Processes
Planning
Processes
Executing
Processes
Monitoring &
Controlling Processes
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Project Integration Management
Knowledge
Area
Process
Initiating Planning Executing Monitoring & Control Closing
Scope
• Develop
Project
Charter
• Develop Project
Management
Plan
• Direct and
Manage Project
Execution
• Monitor and Control
Project Work
• Perform Integrated
Change Control
• Close
Project
Enter phase/
Start project
Exit phase/
End project
Initiating
Processes
Closing
Processes
Planning
Processes
Executing
Processes
Monitoring &
Controlling Processes
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Project Stakeholder Management
Knowledge
Area
Process
Initiating Planning Executing Monitoring & Control Closing
Scope
Identify
StakeholdersPlan
stakeholder
Management
Manage
stakeholders
expectations
Control stakeholder
Enter phase/
Start project
Exit phase/
End project
Initiating
Processes
Closing
Processes
Planning
Processes
Executing
Processes
Monitoring &
Controlling Processes
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The Project Life Cycle
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How do we define success?
On time
Within budget
Scope integrity
Achieving quality
Scope
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Chaos Report
31.1% of projects will be cancelled before they ever get completed
52.7% of projects will cost 189% of their original estimates
Only 16.2% of projects were completed successfully
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Why Projects Fail?
A subject for discussion
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The Opera House Project-Sydney
Original cost estimate (in 1957) was US$ 7 million.
The original completion date was 26 January 1963.
Finally, the Opera House was formally completed in 1973, having cost $102 million.
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The Three Main Ones
Among the following factors, which is the most important contributor to project failure??!!
Lack of Executive
Management Support
Unclear Objectives
No User Involvement
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Reason 1
Lack of User Involvement
– Correctly identify proper user
– Develop and Maintain a quality relationship with the client
– Create and maintain a platform for communication
– Demonstrate results
– Educate the client
– Consider their feedback
– Identify and recruit an evangelist
– Conduct primary research
– Show respect
– Focus on real user needs
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Reason 2
No Executive Management Support
– Have a simple vision
– Get clear commitment
– Make fast decisions
– Have a decision pipeline
– Focus of education
– Use measurements
– Understand how and why you need to negotiate
– Have a well thought plan
– Have a “kill switch”
– CELEBRATE
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Reason 3 Absence of clear business objectives
– Make sure everyone understands the project's objectives
– Elevator pitch
– Consider the big picture
– Promote speed and clarity
– Have a yardstick
– Use RoI
– Collaborate with team members
– Use peer review
– Avoid having “too many cooks”
– Do your homework
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Enterprise Environmental Factors
The Internal and External environmental factors surrounding and/or influencing the project negatively or positively.
Are Inputs to most of the Project Management Processes.
Can be categorized into Internal and External
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Enterprise Environmental Factors Culture & structure
Regulations & Standards
Infrastructure
Existing human resources
Personnel administration
Political climate
Commercial databases
Information systems
Stakeholders risk tolerance
Marketplace Conditions
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Organizational Process Assets
Include all process related assets in addition to the organization’s knowledge bases
Input to most of the project management processes
Outputs of many processes may include updating or adding to these process assets
Can be categorized into:
Processes and procedures
Corporate knowledge base
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Processes and Procedures
Standard Processes.
Templates.
Communication Requirements.
Financial Controls Procedures.
Issue and Defect Management Procedures.
Change Control Procedure.
Risk Control Procedures.
Approval Procedures.Ahmad Maharma PMBOK 5th Edition 100
Corporate Knowledge
Process Measurement Database.
Project Files.
Historical Information and Lessons Learned.
Issue and Defect Management Database.
Configuration Management Knowledge Base.
Financial Database.
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PMBOK Reading
Chapters 2 & 3
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Project Management Professional
PMP®
Phase #1: PROJECT INITIATION
Why projects start?
A market demand,
An Organizational need,
A customer request,
A technological advance,
A legal requirement,
A social demand,
An Ecological impact.
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Project Management Professional
PMP®
Phase #1 : INITIATION
Chapter 4: Integration / 4.1 Develop Project Charter
Initiation Processes
Develop ProjectCharter
Integration
Identify Stakeholders
Communication
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Develop Project Charter
The process of developing a document that formally authorizes a project or a phase and documenting initial requirements that satisfy the stakeholders needs and expectations.
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What is a Project Charter?
A document that formally authorizes a project or a phase and documents initial requirements that satisfy the stakeholders needs and expectations
Projects are chartered and authorized external to the project
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Why a charter is needed?
Defines the reason of the project
Assigns the project manager and his/ her authority level
Linking the project to the strategy and ongoing work of the organization
Helps in starting the planning for the project
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Facts about the project charter
A must for all projects and/ or phases
Communicate the project purpose or justification, high level objectives, project and product requirements and initial risks.
Should be clear enough, yet broad to a level that the charter doesn’t change over the project’s life.
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Develop Project Charter
Project Statement of Work (SOW)
Business Case
Agreements
Enterprise Environmental Factors
Organizational Processes Assets
Expert Judgment
Facilitation Techniques
Project Charter
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Project Statement of Work
A narrative description of products or services to be supplied by the project.
References:
Business need.
Product scope description.
Strategic plan.
For external projects, provided by customer as part of a bid document.
For internal projects, provided by sponsor or initiator.
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Business Case
A document that provides necessary information from a business perspective on whether or not the project is worth the investment
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Agreements
MoUs
SLAs
Letters of Agreement
Letters of Intent
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Expert Judgment
Stakeholders.
Consultants.
Industrial groups.
Professional and technical associations.
Other units within organization.
Subject matter experts (SMEs)
Project management office (PMO)
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Facilitation Techniques
Brainstorming
Conflict Resolution
Problem Solving
Meetings
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Contents of project Charter
Purpose or justification
Project Description
Project and Product Requirements
Acceptance Criteria
Initial Risks
Summary Milestones
Estimated Budget
Project Manager Authority Level
Approval Requirements
Name & authority of the person(s) authorizing the project charter
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Project Management Professional
PMP®
Phase #1: PROJECT INITIATION
Chapter 13: Stakeholders / 13.1 Identify Stakeholders
Identify Stakeholders
Develop ProjectCharter
Integration
Identify Stakeholders
Communication
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Identify Stakeholders
Project Charter
Procurement Documents
Enterprise Environmental Factors
Organizational Process Assets
Stakeholder Analysis
Expert Judgment
Meetings
Stakeholder Register
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Stakeholder Analysis
The process of systematically gathering and analyzing quantitative and qualitative information to determine whose interests should be taken into account throughout the projects.
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3 Steps to Managing Stakeholders
1. Identify Your Stakeholders
2. Prioritize Your Stakeholders
3. Manage Your Stakeholders
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Step1- Identify Stakeholders
Identifying all stakeholders impacted by the project and documenting relevant Information regarding their interests, involvement, and impact on the project success.
It is essential to identify all stakeholders to increase the likelihood of project success.
Should be done as early as possible.
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Identify Stakeholders Purpose
Enables the project manager to focus on the relationships necessary to ensure the success of the project.
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Stakeholder Register
The Stakeholder Register is used to identify those people and organizations impacted by the project and document relevant information about each stakeholder.
Includes all details related to the identified stakeholders. Identification information: Name, organizational position,
location, role in project, contact information.
Assessment information: Major requirements, main expectations, potential influence, phase.
Stakeholder classification: Internal/ external, supporter/ neutral/ resistor, etc.
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Step2- Prioritize YourStakeholders
Identify the potential impact or support each stakeholder could generate
Classify them according to:
1. Power/Interest Grid
2. Power/ Influence Grid
3. Influence/ Impact Grid
4. Salience Model
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Power/ Interest Grid
Keep
Informed
Monitor
(Minimum
Effort)
Manage
Closely
Keep
Satisfied
High
Low
Low High
Power
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Step3: Assess Your Stakeholders
Anticipate how key stakeholders react in different situations, in order to plan how to influence them to enhance their support and mitigate potential negative impact.
Ahmad Maharma PMBOK 5th Edition 128
PMBOK Reading
Chapter 4
- Section 4.1
Chapter 13
- Section13.1
Ahmad Maharma PMBOK 5th Edition 129
Project Management Professional
PMP®
Phase #2: PROJECT PLANNING
Project Management Professional
PMP®
Phase #2: PROJECT PLANNING
Chapter 4: Scope / 4.2 Develop Project Management Plan
Develop Project Management Plan
Documenting the actions necessary to define, prepare, integrate, & coordinate all subsidiary plans into a project management plan.
Ahmad Maharma PMBOK 5th Edition 132
Develop Project Management Plan
Project Charter
Outputs from Planning Processes
Enterprise Environmental Factors
Organizational Process Assets
Expert JudgmentProject
Management Plan
Ahmad Maharma PMBOK 5th Edition 133
Project Management Plan
Integrates and consolidates all of the subsidiary management plans and baselines from the planning processes.
Includes but not limited to:
Project management processes selected by the project management team.
Level of implementation of each selected process.
Descriptions of tools & techniques
How the selected processes will be selected to manage the specific project
How work will be executed to accomplish objectives
A change management plan
Ahmad Maharma PMBOK 5th Edition 134
Project Management Plan contents
Subsidiary Plans
Project Scope Management Plan
Requirements Management Plan
Schedule Management Plan
Cost Management Plan
Quality Management Plan
Process Improvement Plan
Staffing Management Plan
Communication management Plan
Risk Management Plan
Procurement Management Plan
Baselines
Schedule
Cost performance
Scope
Ahmad Maharma PMBOK 5th Edition 135
Project Management Plan Vs. Project Documents
Project Management Plan Project DocumentsChange Management Plan Activity Attributes Project Staff Assignment
Communications Management Plan Activity Cost Estimates Project Statement of Work
Configuration Management Plan Activity Duration Estimates Quality Checklists
Cost Baseline Activity List Quality Control Measurements
Cost Management Plan Activity Resource Requirements Quality Metrics
Human Resource Management Plan Agreements Requirements Documentation
Process Improvement Plan Basis of Estimates Requirements Traceability Matrix
Procurement Management Plan Change Log Resource Breakdown Structure
Scope Baseline Change Requests Resource Calendars
Quality Management Plan Forecasts Risk Register
Requirements Management Plan Issue Log Schedule Data
Risk Management Plan Milestone List Seller Proposals
Schedule Baseline Procurement Documents Source Selection Criteria
Schedule Management Plan Procurement Statement of Work Stakeholder Register
Scope Management Plan Project Calendars Team Performance Assessment
Stakeholder Management Plan Project Charter Work Performance ReportsAhmad Maharma PMBOK 5th Edition 136
PMBOK Reading
Chapter 4
- Section 4.2
Ahmad Maharma PMBOK 5th Edition 137
Project Management Professional
PMP®
Phase #2: PROJECT PLANNING
Chapter 5: Scope / 5.1 Plan Scope Management
Scope Planning
Plan Scope Management
CollectRequirements
Define Scope
CreateWBS
Ahmad Maharma PMBOK 5th Edition 139
Project Scope Vs. Product Scope
Project Scope: The work that needs to be accomplished to deliver a product, service, or result with the specified features and functions
Product Scope: The features and functions that characterize a product, service, or result
Ahmad Maharma PMBOK 5th Edition 140
Plan Scope Management
Plan Scope Management
CollectRequirements
Define Scope
CreateWBS
Ahmad Maharma PMBOK 5th Edition 141
Plan Scope management
The process of creating a scope management plan that documents how the project scope will be defined, validated and controlled.
It provides guidance on how scope will be managed throughout the project.
Ahmad Maharma PMBOK 5th Edition 142
Plan Scope Management
Project Management Plan
Project Charter
Enterprise environmental factors
Organizational Process Assets
Expert Judgment
Meetings
Scope Management Plan
Requirements Management Plan
Ahmad Maharma PMBOK 5th Edition 143
Project Scope Management Plan
Part of Develop Project Management Plan
The outcome of a planning effort that precedes performing the processes of project scope management
Documents how the scope will be defined, verified, controlled, and how the work breakdown structure (WBS) will be created and defined.
Can be formal or informal depending on needs of the project.
Ahmad Maharma PMBOK 5th Edition 144
It Includes:
Processes for:
– Detailing the project scope statement.
– WBS creation, maintenance, and approval.
– Formal verification and acceptance of the completed project deliverables.
– Control how requests to change the detailed project
scope statement will be processed.
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Requirements Management Plan (RQM)
A Plan that documents how requirements will be analyzed, document and managed (tracked, reported, prioritized…) throughout the project life cycle.
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Requirements Management Plan (RQM) Components
How Requirement activities will be planned, tracked and reported
Configuration Management Activities
Requirements Prioritization Process
Product Metrics
Traceability Structure
Ahmad Maharma PMBOK 5th Edition 147
Project Management Professional
PMP®
Phase #2: PROJECT PLANNING
Chapter 5: Scope / 5.2 Collect Requirements
Collect Requirements
Plan Scope Management
CollectRequirements
Define Scope
CreateWBS
Ahmad Maharma PMBOK 5th Edition 149
Collect Requirements
The process of defining and documenting stakeholders’ needs to meet project objectives.
Requirements include the quantified and documented needs and expectations of the sponsor, customer, and other stakeholders.
WBS, cost, schedule and quality planning are all built upon these requirements.
Need to be elicited, analyzed, and recorded in enough detail to be measured once project execution begins
Ahmad Maharma PMBOK 5th Edition 150
Collect Requirements
Project Requirements include business requirements, project management requirements, delivery requirements, etc.
Product Requirements include information on technical requirements, security requirements, performance requirements, etc.
Ahmad Maharma PMBOK 5th Edition 151
Collect Requirements
Scope Management Plan
Requirements Management Plan
Stakeholder Management Plan
Project Charter
Stakeholder Register
Interviews Focus Groups Facilitated
WorkshopsGroup Creativity
TechniquesGroup Decision
Making TechniquesQuestionnaires and
SurveysObservationsPrototypesBenchmarking Context DiagramDocument Analysis
Requirements Documentation
Requirements Traceability Matrix
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Interviews
Talking to stakeholders directly.
Asking questions and recording answers
“One-on-one”, or multiple interviewers and/ or interviewees.
Interviewing:
Experienced participants
Stakeholders
Subject matter experts
Ahmad Maharma PMBOK 5th Edition 153
Focus Groups
Bring together prequalified stakeholders and subject matter experts.
Trained moderator guides the group through an interactive discussion.
More conservational than one-on-one
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Facilitated Workshops
Focused sessions that bring key cross-functional stakeholders together to define product requirements
Helps in building trust, foster relationships, and improve communication.
Reveal and resolve issues more quickly than individual sessions.
Examples: Joint Application Development (JAD) & Quality Function Deployment (QFD)
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Group Creativity Techniques
• Brainstorming. A technique used to generate and collect multiple ideas related to project and product requirements.
• Nominal group technique. This technique enhances brainstorming with a voting process used to rank the most useful ideas for further brainstorming or for prioritization.
• The Delphi Technique. A selected group of experts answers questionnaires and provides feedback regarding the responses from each round of requirements gathering. The responses are only available to the facilitator to maintain anonymity
• ldea/mind mapping. Ideas created through individual brainstorming are consolidated into a single map to reflect commonality and differences in understanding, and generate new ideas.
• Affinity diagram. This technique allows large numbers of ideas to be sorted into groups for review and analysis.
Ahmad Maharma PMBOK 5th Edition 156
Mind Map Example
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Group decision Making Techniques
Group decision making is an assessment process of multiple alternatives with an expected outcome in theform of future actions resolution. These techniques can be used to generate, classify,
and prioritize product requirements.
There are multiple methods of reaching a group decision, for example:
• Unanimity. Everyone agrees on a single course of action.
• Majority. Support from more than 50% of the members of the group.
• Plurality. The largest block in a group decides even if a majority is not achieved.
• Dictatorship. one individual makes the decision for the group.
Almost any of the decision methods described previously can be applied to the group techniques used in therequirements gathering process.
Ahmad Maharma PMBOK 5th Edition 158
Questionnaires & Surveys
Written sets of questions.
Aim to quickly accumulate information from a broad group of respondents.
Most appropriate with broad audience, when quick turnaround is needed, and where statistical analysis is appropriate.
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Observations
Viewing user performance
Also called “Job shadowing”
Helpful for detailed processes when people that use the product have difficulty or reluctant to articulate their requirements
Can uncover hidden requirements
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Prototypes
Provide a working model of the expected product before actually building it.
Support the concept of progressive elaboration through use of iterative cycles of mock-up creation, user experimentation, feedback generation and prototype revision.
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Benchmarking
Involves comparing 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.
Compared organizations can be external or internal.
Ahmad Maharma PMBOK 5th Edition 162
Context Diagrams
Visually depict the product scope by showing a business system (process, equipment, computer system…etc.), and how people and other systems (actors) interact with it.
Context diagrams show inputs to the business system, the actor(s) providing the input, the outputs of the business system, and the actor(s) receiving the output.
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Context Diagrams
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Requirements Documentation
The document including the stakeholders’ requirements to meet the business need for the project.
Usually starts at a high level and then gets elaborated within the life cycle of the project and according to the RQM
Ahmad Maharma PMBOK 5th Edition 165
Requirements Documentation Elements
Business need or opportunity
Functional requirements and non functional requirements
Quality requirements
Acceptance criteria
Business rules
Impacts to other organizational areas, and other entities inside or outside the performing organization
Support and training requirements
Requirements assumptions and constraints
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Requirements Traceability Matrix
A tool that links project objectives to requirements to deliverables to product features.
The structure and level of details of the traceability matrix to be used shall be documented in the RQM as different projects can use different structures of traceability.
This tool can be as simple as a table or as complex as a software program.
Ahmad Maharma PMBOK 5th Edition 167
Requirements Traceability Matrix Contents
Business needs, opportunities, goals, and objectives
Project objectives
Project scope, WBS deliverables
Product design
Product development
Test strategy and test scenarios
High level requirements to more detailed requirements
Ahmad Maharma PMBOK 5th Edition 168
Example of Requirements Traceability Matrix
Ahmad Maharma PMBOK 5th Edition 169
Project Management Professional
PMP®
Phase #2: PROJECT PLANNING
Chapter 5: Scope / 5.3 Define Scope
Define Scope
Plan Scope Management
CollectRequirements
Define Scope
CreateWBS
Ahmad Maharma PMBOK 5th Edition 171
Define Scope
The process of developing a detailed description of the project and the product
Critical to project success.
Builds upon the major deliverables, assumptions, and constraints documented in the project initiation.
Ahmad Maharma PMBOK 5th Edition 172
Define Scope
Scope Management Plan
Project Charter
Requirements Documentation
Organizational Process Assets
Expert Judgment
Product Analysis
Alternatives Identification
Facilitated Workshops
Project Scope Statement
Project Document Updates
Ahmad Maharma PMBOK 5th Edition 173
Product Analysis
Translating high-level product description into tangible deliverables
Includes techniques such as:
Product breakdown
System analysis
Requirements analysis
System engineering
Value engineering
Value analysis
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Alternatives Identification
A technique to generate different approaches to execute and perform the work of the project.
Includes techniques such as:
Brainstorming
Lateral thinking
Pairwise comparison
Ahmad Maharma PMBOK 5th Edition 175
Project Scope Statement
The project scope statement describes in details the project deliverables, and the work required to create those deliverables.
Common understanding among stakeholders,
Enables more detailed planning,
Guides the project team’s work during execution,
Provides the baseline for evaluating changes.
Ahmad Maharma PMBOK 5th Edition 176
Project Scope StatementContents
Product scope description
Product acceptance criteria
Project deliverables
Project exclusions
Project constraints
Project assumptions
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Constraints
Applicable restrictions that will affect the performance of the project.
Factors that affect a scheduled activity or when an activity can be scheduled.
Ahmad Maharma PMBOK 5th Edition 178
Assumptions
Are factors that, for planning purposes, are considered to be true, real, or certain.
Affect all aspects of project planning.
Part of the project’s progressive elaboration.
Generally involve a degree of RISK.
Must be identified, documented and validated.
Ahmad Maharma PMBOK 5th Edition 179
Project Management Professional
PMP®
Phase #2: PROJECT PLANNING
Chapter 5: Scope / 5.4 Create WBS
Create WBS
Plan Scope Management
CollectRequirements
Define Scope
CreateWBS
Ahmad Maharma PMBOK 5th Edition 181
Create WBS
The process of subdividing project deliverables and project work into smaller, more manageable components.
WBS is a deliverable-oriented hierarchical decomposition of the work to be executed by the project team to accomplish the project objectives, and create the required deliverables.
Each descending level represents an increasingly detailed definition of the project work.
Organizes and defines the total scope of the project.
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Ahmad Maharma PMBOK 5th Edition 183
Ahmad Maharma PMBOK 5th Edition 184
WBS Types
Phases- Deliverables
Deliverables-Phases
Combination of both
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Example: WBS (Phases –Deliverables)
Ahmad Maharma PMBOK 5th Edition 186
Example: WBS (Deliverables–Phases)
Ahmad Maharma PMBOK 5th Edition 187
Create WBS
Scope Management Plan
Project Scope Statement
Requirements Documentation
Enterprise Environmental Factors
Organizational Process Assets
Decomposition
Expert JudgmentScope Baseline
Project Document Updates
Ahmad Maharma PMBOK 5th Edition 188
Decomposition
Subdivision of project deliverables into smaller, more manageable components until the work and deliverables are defined to the work package level.
The level of composition varies per deliverable/ phase with the size and complexity of project.
Ahmad Maharma PMBOK 5th Edition 189
Work Package
The “Work Package” level is the lowest level in the WBS.
Work Package is the point at which the cost and activity duration can be reliable, estimated and packaged.
Ahmad Maharma PMBOK 5th Edition 190
Decomposition Involves
Identifying deliverables and related work.
Structuring and organizing the WBS.
Decomposing upper levels into lower level detailed components.
Developing and assigning identification codes.
Verifying that the degree of decomposition is necessary and sufficient.
Ahmad Maharma PMBOK 5th Edition 191
WBS Dictionary Contents
Code of account identifier
Statement of work
Responsible organization
Schedule milestones
Associated activities
Resources required
Cost estimates
Quality requirements
Acceptance criteria
Technical references
Contract information
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Scope Baseline
Scope statement
WBS
WBS dictionary
Ahmad Maharma PMBOK 5th Edition 193
WBS Dictionary
A document generated by the “Create WBS” process that supports the WBS.
Provides more detailed description of the components in the WBS., including work packages and control accounts.
Ahmad Maharma PMBOK 5th Edition 194
WBS is not
Organizational Breakdown Structure (OBS)
Bill Of Materials (BOM)
Risk Breakdown Structure (RBS)
Resource Breakdown Structure (RBS)
Ahmad Maharma PMBOK 5th Edition 195
PMBOK Reading
Chapter 5
- Sections 5.1-5.4
Ahmad Maharma PMBOK 5th Edition 196
Project Management Professional
PMP®
Phase #2: PROJECT PLANNING
Chapter 6: Time / 6.1 Plan Schedule Management
PM Knowledge Areas & Process Groups 47 processesPM Process Groups
Knowledge Area
Processes
Initiating Process
Group
Planning Process Group Executing Process Group Monitoring & Controlling Process
Group
Closing
Process Group
Project Management
Integration
Develop Project
Charter
Develop Project Management
Plan
Direct and Manage Project
Execution
Monitor and Control Project Work
Integrated Change Control
Close Project
Project Scope
Management
Plan Scope Management
Collect requirements
Define Scope
Create WBS
Validate Scope
Control Scope
Project Time
Management
Plan schedule Management
Define Activity
Sequence Activity
Estimating Resource
Estimating Duration
Develop Schedule
Control Schedule
Project Cost
Management
Plan Cost Management
Estimating Cost
Budgeting Cost
Control Cost
Project Quality
Management
Quality Planning Perform Quality Assurance Perform Quality Control
Project HR
Management
Plan HR Management Acquire Project Team
Develop Project Team
Manage Project Team
Project
Communications
Management
Plan Communications Distribute Information Performance Reporting
Project Risk
Management
Plan Risk Management
Risk Identification
Qualitative / Quantitative Risk
Analysis
Risk Response Planning
Risk Monitoring and Control
Project Procurement
Management
Plan procurement Conduct procurement Administer Contract Close
procurement
Project Stakeholder
Management
Identify Stakeholders Plan stakeholder Management Manage stakeholders
expectations
Control stakeholder
198Ahmad Maharma PMBOK 5th Edition
Project Time Management
Knowledge
Area
Process
Initiating Planning ExecutingMonitoring &
ControlClosing
Time
Plan schedule Management
Define Activity
Sequence Activity
Estimating Resource
Estimating Duration
Develop Schedule
Control Schedule
Enter phase/
Start project
Exit phase/
End project
Initiating
Processes
Closing
Processes
Planning
Processes
Executing
Processes
Monitoring &
Controlling Processes
199Ahmad Maharma PMBOK 5th Edition
Project Time Planning
EstimateActivity
Durations
Develop Schedule
Sequence Activities
Estimate Activity
Resources
Define Activities
Plan Schedule
Management
Ahmad Maharma PMBOK 5th Edition 200
Plan Schedule Management
EstimateActivity
Durations
Develop Schedule
Sequence Activities
Estimate Activity
Resources
Define Activities
Plan Schedule
Management
Ahmad Maharma PMBOK 5th Edition 201
Plan Schedule Management
The process of establishing policies, procedures, and documentation for planning, developing, managing, executing, and controlling the project schedule.
The key benefit of the process is that it provides guidance and direction on how the project schedule will be managed throughout the project.
Ahmad Maharma PMBOK 5th Edition 202
Plan Schedule Management
Project Management Plan
Project Charter
Enterprise Environmental factors
Org. Process Assets
Expert Judgment
Analytical Techniques
Meetings
Schedule Management Plan
Ahmad Maharma PMBOK 5th Edition 203
Analytical Techniques
Scheduling Methodology
Scheduling Tools & Techniques
Estimating Approaches
Formats
Project Management Software
Ahmad Maharma PMBOK 5th Edition 204
Schedule Management Plans
A component of the project management plan.
Establishes the criteria and activities for developing, monitoring, and controlling the schedule.
Can be formal or informal
Can be highly detailed or broadly defined based on the needs of the project
Ahmad Maharma PMBOK 5th Edition 205
Schedule Management Plans
Can include the following:
Project schedule model development
Level of accuracy
Units of measure
Organizational procedures links
Project schedule management maintenance
Control schedule
Rules of performance measurement
Reporting formats
Process description
Ahmad Maharma PMBOK 5th Edition 206
Project Management Professional
PMP®
Phase #2: PROJECT PLANNING
Chapter 6: Time / 6.2 Define Activities
Define Activities
EstimateActivity
Durations
Develop Schedule
Sequence Activities
Estimate Activity
Resources
Define Activities
Plan Schedule
Management
Ahmad Maharma PMBOK 5th Edition 208
Define Activities
The process of identifying the specific actions to be performed to produce the project deliverables.
Decomposed from the “work packages” at the WBS.
Activities are the smaller components that represent the work necessary to complete the work package.
Activities provide basis for estimating, scheduling, executing, and monitoring and controlling the project work.
Ahmad Maharma PMBOK 5th Edition 209
Define Activities
Schedule Management Plan
Scope Baseline
Enterprise Environmental factors
Org. Process Assets
Decomposition
Rolling Wave Planning
Expert Judgment
Activity List
Activity Attributes
Milestone List
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Rolling Wave Planning
Progressive detailing of the project management plan
Ahmad Maharma PMBOK 5th Edition 211
Activity List
A comprehensive list including all schedule activities required for the project.
Includes:
Activity identifier
Description of each activity
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Project Management Professional
PMP®
Phase #2: PROJECT PLANNING
Chapter 6: Time / 6.3 Sequence Activities
Sequence Activities
EstimateActivity
Durations
Develop Schedule
Sequence Activities
Estimate Activity
Resources
Define Activities
Plan Schedule
Management
Ahmad Maharma PMBOK 5th Edition 214
Sequencing Activities
Schedule Management Plan
Activity List Activity
Attributes Milestone List Enterprise
Environmental Factors
Project Scope Statement
Organizational Process Assets
Precedence Diagramming Method (PDM)
Dependency Determination
Applying Leads and Lags
Project Schedule Networking Diagram
Project Documents Update
Ahmad Maharma PMBOK 5th Edition 215
Sequence Activities
Identifying & documenting dependencies among schedule activities
Can be done using software or manually.
Ahmad Maharma PMBOK 5th Edition 216
Precedence Diagramming Method (PDM)
Also known as Activity-On-Node
Activities are represented in boxes (Nodes),
and arrows show dependencies
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Dependencies Relationships
Finish-to-Start
Finish-to-Finish
Start-to-Start
Start-to-Finish
A
B
A
B
A
BA
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Dependencies Relationships
Use the following Rule of Thumb to understand the relationships better:
Activity A should _ _ _ _ _ _ Before activity B can _ _ _ _ _ _
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Types of Dependencies
Mandatory
Discretionary
External
Internal
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Applying Leads & Lags
Lead: The overlapping time
Lag: The waiting time
Float/ Slack: The time an activity can be delayed (wait) without affecting the project finish date
A lead allows an acceleration of the successor activity.
A lag directs a delay in the successor activity.
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Applying Leads & Lags
• Leads.– May be added to start an activity before the predecessor activity is complete.
• Lags– Inserted waiting time between activities
A
B
A
B
Ahmad Maharma PMBOK 5th Edition 222
Project Management Professional
PMP®
Phase #2: PROJECT PLANNING
Chapter 6: Time / 6.4 Estimate Activity Resources
Estimate Activity Resources
EstimateActivity
Durations
Develop Schedule
Sequence Activities
Estimate Activity
Resources
Define Activities
Plan Schedule
Management
Ahmad Maharma PMBOK 5th Edition 224
Estimate Activity Resources
Estimating the type and quantities of resources required to perform each schedule activity
Ahmad Maharma PMBOK 5th Edition 225
Types of Resources
Material
People
Equipment
Ahmad Maharma PMBOK 5th Edition 226
Estimate Activity Resources
Schedule Management PlanActivity ListActivity
AttributesResource
CalendarsRisk RegisterActivity Cost
EstimatesEnterprise
Environment Factors Org. Process
Assets
Expert Judgment
Alternatives Analysis
Published Estimating Data
Bottom-up Estimating
Project Management Software
Activity Resource Requirements
Resource Breakdown Structure (RBS)
Project Document updates
Ahmad Maharma PMBOK 5th Edition 227
Project Management Professional
PMP®
Phase #2: PROJECT PLANNING
Chapter 6: Time / 6.4 Estimate Activity Duration
Estimate Activity Durations
EstimateActivity
Resources
Develop Schedule
Sequence Activities
Estimate Activity
Durations
Define Activities
Plan Schedule
Management
Ahmad Maharma PMBOK 5th Edition 229
Estimate Activity Durations
Approximating the number of work periods needed to complete individual activities with estimated resources.
Uses information on:
Activity scope of work
Required resource types
Estimated resource quantities
Resource calendar
Progressively elaborative
Takes elapsed time into account
Ahmad Maharma PMBOK 5th Edition 230
Estimate Activity Durations
Schedule Management Plan
Activity List
Activity Attributes
Activity Resource Requirements
Resource Calendars
Project Scope Statement
Risk Register Resource Breakdown
Structure
Enterprise Environment Factors
Org. Process Assets
Expert Judgment Analogous
Estimating Parametric
EstimatingThree Point
Estimates (PERT)Group Decision-
Making TechniquesReserve
Analysis
Activity Duration Estimates
Project DocumentUpdates
Ahmad Maharma PMBOK 5th Edition 231
Estimate Activity Durations: Tools and Techniques
Expert Judgment
Expert judgment, guided by historical information, can provide duration estimate information orrecommended maximum activity durations from prior similar projects.
Analogous Estimating
Analogous estimating uses parameters such as duration, budget, size, weight, and complexity,from a previous, similar project, as the basis for estimating the same parameter or measure fora future project.
Analogous duration estimating is frequently used to estimate project duration when there is alimited amount of detailed information about the project for example, in the early phases of aproject.
Analogous estimating uses historical information and expert judgment.
Ahmad Maharma PMBOK 5th Edition 232
Parametric Estimating
Parametric estimating uses a statistical relationship between historical data and other variables
(e.g. square footage in construction) to calculate an estimate for activity parameters,
This technique can produce higher levels of accuracy depending upon the sophistication and underlying data built into the model.
Parametric time estimates can be applied to a total project or to segments of a project, in conjunction with other estimating methods, such as cost, budget, and duration.
Estimate Activity Durations: Tools and Techniques
Ahmad Maharma PMBOK 5th Edition 233
Three-Point Estimating
The accuracy of activity duration estimates can be improved by considering estimation uncertainty and risk.
• Triangular Distribution. tE = (tO + tM + tP) / 3
• Beta Distribution (from the traditional PERT technique). tE = (tO + 4tM + tP) / 6
Estimate Activity Durations: Tools and Techniques
Ahmad Maharma PMBOK 5th Edition 234
Three Point (PERT) Estimates
Time Expected (te)= (to+4xtm+tp)/6
to: Optimistic Estimate
tm= Average Estimate
tp= Pessimistic Estimate
Based on a the assumption of Beta distribution
Ahmad Maharma PMBOK 5th Edition 235
Beta Distribution
Ahmad Maharma PMBOK 5th Edition 236
Activity Optimistic Duration
The total number of work periods in calendar units assigned to perform the schedule activity, considering all of the variables that could affect performance, and is determined to be the shortest possible activity duration
It is determined by answering the question
How long will it take in the best case scenario?
Ahmad Maharma PMBOK 5th Edition 237
Activity Pessimistic Duration
The total number of work periods in calendar units assigned to perform the schedule activity, considering all of the variables that could affect performance, and is determined to be the longest possible activity duration
It is determined by answering the question
How long will it take in the worst case scenario?
Ahmad Maharma PMBOK 5th Edition 238
Activity Most Likely Duration
The total number of work periods in calendar units assigned to perform the schedule activity, considering all of the variables that could affect performance, and is determined to be the most probable activity duration
It is determined by answering the question:
How long will it most likely take?
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Standard Deviation & variance
Activity Std. Deviation (σactivity) = P – O
6
Variance = (P – O)2
6
Project Std Deviation (σ project)=
√ ∑ Variance Critical Path Activities
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Estimates Certainty
Confidence level in the value is approximately 50%
Confidence level in the value + SD is approximately 85%
Confidence level in the value + 1.645 × SD is approximately 95%
Confidence level in the value + 2 × SD is approximately 98%
Confidence level in the value + 3 × SD is approximately 99.9%
Ahmad Maharma PMBOK 5th Edition 241
3-Points Estimate (PERT)
Expected
6
Ο4ΜP
Standard
Deviation
6
ΟP
Variance
6
ΟP 2
varianceSD
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3-Points Estimate (PERT)
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3-Points Estimate (PERT)
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3-Points Estimate (PERT)
Ahmad Maharma PMBOK 5th Edition 245
Exercise: Tree-point estimates (PERT)
ActivityDuration Expected
Duration
(PERT)
Activity
Standard
Deviation
Variance
range
Range of
the estimate
P M O
A 3 5 1
B 8 4 2
C 15 8 5
D 20 10 5
Project (Total) -
Ahmad Maharma PMBOK 5th Edition 246
Exercise: PERT - Most tricky question (Answer)
• See that the question says that Duration Uncertainty is Pessimistic minus Optimistic in other words P-O. We know that SD is (P-O ) / 6 , thus SD is "duration Certainty " / 6
ThusFor Path 1 : SD = 18/6 = 3Variance = 3*3 = 9
For path 2 : SD = 24 /6 = 4Variance = 4*4 = 16
Total Path Variance = 16 + 9 = 25Sqrt (25) = 5
Meaning (P-O) / 6 = 5(p-O) = 5 * 6DURATION UNCERTAINTY = 30
Ahmad Maharma PMBOK 5th Edition 247
Schedule Uncertainty & Risk Analysis Process
Schedule risk analysis uses information about the uncertainty of activity durations to help answer the following questions:
What is the likelihood of finishing project as scheduled?
How much contingency is needed to establish a completion date with a probability of success that is acceptable to the stakeholders?
Which activities are the most likely to delay the project?
What actions can be taken to control risks in the schedule?
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Schedule Uncertainty & Risk Analysis Process
If estimating activity duration involves a great deal of uncertainty, a commonly used technique is the application of probabilistic estimates
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Critical Path
The longest path from the beginning to the end of the project. Activities on the critical path cannot be delayed without delaying the project.
There can be more than one critical path (riskier)
Project Manager should focus on critical path.
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Network Diagram
A
2
B
3
C
1
D
4
E
3
F
2
G
4
H
2
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Calculating Critical Path
Specify the individual activities.
Determine the sequence of activities.
Draw the network diagram.
Estimate activity completion time.
Identify critical path.
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Project Management Professional
PMP®
Phase #2: PROJECT PLANNING
Chapter 6: Time / 6.6 Develop Schedule
Develop Schedule
EstimateActivity
Resources
Develop Schedule
Sequence Activities
Estimate Activity
Durations
Define Activities
Plan Schedule
Management
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Develop Schedule
The process of analyzing activity sequences, durations, resource requirements, and schedule constraints.
Provides specific start and end dates for activities.
Iterative process.
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Develop Schedule
Schedule Management Plan
Activity List Activity Attributes Project Schedule
Network Diagrams Activity Resource
Requirements Resource Calendars Activity Duration
Estimates Project Scope
Statement Risk Register Project staff
assignment Resource
Breakdown Structure
Org. Process Assets Enterprise
Environmental Factors
Schedule Network Analysis
Critical Path Method
Critical Chain Method
Resource Optimization Techniques
Modeling techniques
Leads & Lags Schedule
Compression Scheduling Tool
Project schedule
Schedule baseline
Schedule data
Project Calendar
Project Management Plan (updates)
Project document (updates)
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Resource OptimizationTechniques
Resource Leveling
Resource Smoothing
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Resource leveling
Used when shared or critical resources are only available at certain times, or in limited quantities, or to keep resource usage at a constant level.
Usually changes the critical path.
Resource leveling can be used when shared or critical required resources are only available at certain times, are Only available in limited quantities, or to
keep resource usage at a constant level.
Resource leveling is necessary when resources have been
over-allocated.
Resource leveling can often cause the original critical path to change.
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Resource leveling
Modeling Techniques
What-If Scenario Analysis
Simulation
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6.6.2 Develop Schedule: Tools and Techniques
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Resource Smoothing. A technique that adjusts the activities of a schedule model such that the
requirements for resources on the project do not exceed certain predefined resource limits. In
resource smoothing, as opposed to resource leveling, the project’s critical path is not changed
and the completion date may not be delayed. In other words, activities may only be delayed within
their free and total float. Thus resource smoothing may not be able to optimize all resources.
What-If Scenario Analysis
An analysis of the question “what if the situation represented by scenario ‘X’ happens”.
Can be used to assess the feasibility of the schedule under adverse conditions, and in preparing contingency and response plans.
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Schedule Compression
Fast Tracking
Crashing
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Fast Tracking
A schedule compression technique in which phases or activities normally performed in sequence are performed in parallel.
Can result in rework and increased risks.
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Crashing
A schedule compression technique in which cost and schedule tradeoffs are analyzed to determine how to obtain the greatest amount of compression for the latest incremental cost.
Can result in increased cost.
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Crashing
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Crashing
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Crashing
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Crashing
Critical Chain Method
A schedule network analysis technique that modifies the project schedule to account for limited resources (according to PMBOK…).
Combines deterministic and probabilistic approaches.
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Project schedule
Milestone Chart
Bar Chart
Project schedule network chart
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Schedule Baseline
Project schedule with baseline start dates and baseline finish dates.
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Start & Finish Dates
ES: Earliest start time.
EF: Earliest finish time.
LF: Latest finish time.
LS: Latest start time.
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Critical Path Method Basic
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275
Figure 6-9. Calculating Early and Late Start and Finish Dates
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Critical Path Method Basic
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Forward Pass
Schedule Calculations That Identify The Early Start and Finish Dates of Tasks and The Project.
ES = EF of Preceding Task (latest if more than one).
EF = ES + Duration.
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Backward Pass
Schedule Calculations That Identify The Late Start and Finish Dates of Tasks and The Project.
LF = LS of succeeding Task (earliest if more than one).
LS = LF - Duration
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Float
Float or slack is the amount of time that a task in a project network can be delayed without causing a delay to:
Subsequent tasks (free float)
Project completion date (total float)
Total Float = LF – EF
OR
LS - ES
Free Float = Min ES (Succeeding Task) – EF
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Critical Path
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Critical Path
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Critical Path
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Critical Path
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Critical Path
A
2
B
3
C
1
D
4
E
3
F
2
G
4
H
2
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A
2
1 2
21
B
3
3 5
53
E
3
3 5
97
C
1
6 6
1515
D
4
6 9
96
F
2
10 11
1110
G
4
12 15
1512
H
2
16 17
1716
Critical Path
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286
Figure 6-8. Determining the Critical Path for Project X
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Using Critical Path Analysis to Make Schedule Trade-offs
• Free slack or free float is the amount of time an activity can be delayed without delaying the early start of any immediately following activities.
• Total slack or total float is the amount of time an activity can be delayed from its early start without delaying the planned project finish date.
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Exercise
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289
Exercise
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Answer
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Answer
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Answer
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Answer
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Exercise
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Exercise
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Answer
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Answer
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Answer
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GERT
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Gantt Chart
• Graph or bar chart with a bar for each project activity that shows passage of time
• Provides visual display of project schedule
• Slack• amount of time an activity can be delayed without
delaying the project
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| | | | |
Activity
Design house and obtain financing
Lay foundation
Order and receive materials
Build house
Select paint
Select carpet
Finish work
0 2 4 6 8 10Month
Month1 3 5 7 9
Example of Gantt Chart
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Project Network
• Activity-on-node (AON)• nodes represent activities, and arrows
show precedence relationships
• Activity-on-arrow (AOA)• arrows represent activities and nodes are
events for points in time
• Event• completion or beginning of an activity in
a project
1 32
Branch
Node
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PMBOK Reading
Chapter 6
- Sections 6.1 – 6.6
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Project Management Professional
PMP®
Phase #2: PROJECT PLANNING
Chapter 7: Cost / 7.1 Plan Cost management
Project Cost Management
Plan CostManagement
EstimateCosts
Determine Budget
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Project Cost management
On smaller projects, cost estimating and cost budgeting are so tightly linked that they can be done together and by one person.
The work done in cost management is preceded by a cost planning effort by the project management team.
Techniques such as Life-Cycle Costing & Value Engineering can improve decision making and reduce cost while improving quality and performance of project deliverables.
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Life-Cycle Costing
A decision making tool that involves tradeoffs between short term project costs and long term product or service operational costs.
It examines the effects of project decisions not only on project activities, but also on the cost of maintaining, using and supporting of the product, service, or result of the project.
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Plan Cost Management
Plan CostManagement
EstimateCosts
Determine Budget
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Plan Cost Management
The process of establishing policies, procedures, and documentation for planning, managing, expending, and controlling project costs.
The key benefit of the process is that it provides guidance and direction on how the project schedule will be managed throughout the project.
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Project Management Professional
PMP®
Phase #2: PROJECT PLANNING
Chapter 7: Cost / 7.2 Estimate Cost
Estimate Costs
Project Management Plan
Project Charter
Enterprise Environmental Factors
Org. Process Assets
Expert Judgment
Analytical Techniques
Meetings
Cost Management Plan
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Cost Management Plan
Part of Develop Project Management Plan
The outcome of a planning effort that precedes performing the processes of project cost management
Sets out the format and establishes the criteria for planning, structuring, estimating, budgeting, and controlling project costs.
Documents cost management processes and their associated tools and techniques
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Cost Management Plan Establishes
Level of accuracy
Level of precision
Units of measure
Organizational procedures links
Control thresholds
Rules of performance measurement
Reporting formats
Process descriptions
Additional details
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Estimate Costs
Plan CostManagement
EstimateCosts
Determine Budget
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Cost Estimating Vs. Cost Budgeting
Cost Estimating: Developing an approximation of the costs of the resources needed to complete project activities
Cost Budgeting: Aggregating the estimated costs of individual activities of work packages to establish a cost baseline
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Estimate Costs
Cost Management Plan
Scope Baseline
Project Schedule
Human Resource Plan
Risk Register
Enterprise Environmental Factors
Org. Process Assets
Expert Judgment Analogous
Estimating Parametric
Estimating Bottom-up
estimating Three-Point
Estimates Reserve analysis Cost of Quality Project
Management Estimating Software
Vendor Bid Analysis
Group Decision-Making Techniques
Activity Cost Estimates
Basis of Estimates
Project Document Updates
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Analogous Estimating
Using cost of previous similar projects as basis for estimating.
Less Costly BUT less accurate.
Used when information is limited (early phases).
Reliable when previous projects are similar in fact, not just in appearance.
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Parametric Estimating
Uses relationship between historical data and certain parameters (cost per square meter, cost per meter, etc).
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Bottom-Up Estimating
A method for estimating a component of work.
The cost is estimated for individual work packages or activities, and they are then summarized or “rolled-up” to higher levels.
Cost and accuracy are influenced by the size and complexity of the individual package or activity.
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Vendor Bid analysis
Includes analysis of what the project should cost, based on responsive bids from qualified vendors.
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Activity Cost Estimates
A quantitative assessment of the likely costs of the resources required to complete project activities.
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Basis of Estimates
Documentation of basis of estimates (how it was developed).
Documentation of assumptions made.
Documentation of any known constraints.
Indication of range of estimates.
Indication of confidence level of the final estimate.
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Cost Elements
Human Resources – Labor
Hour rate, fringe benefits, overtime, overhead, per diem
Equipment & Software
Depreciation, purchase cost, support & Maintenance
Facilities
Rent, depreciation, utilities, admin overhead
Supplies
Stationary, food, leisure, gas for cars, tickets
Special expenses
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Types of Cost• Variable Costs
– Change with the amount of production/work
– e.g. material, supplies, wages
• Fixed Costs
– Do not change as production change
– e.g. set-up, rental
• Direct Costs
– Directly attributable to the work of project
– e.g. team travel, recognition, team wages
• Indirect Costs
– overhead or cost incurred for benefit of more than one project
– e.g. taxes, fringe benefit, janitorial services
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Project Management Professional
PMP®
Phase #2: PROJECT PLANNING
Chapter 7: Cost / 7.3 Determine Budget
Determine Budget
Plan CostManagement
EstimateCosts
Determine Budget
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Determine Budget
The process of aggregating the estimated costs to individual activities or work packages to establish an authorized cost baseline.
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Determine Budget
Cost Management PlanScope BaselineActivity Cost
EstimatesBasis of Cost
EstimatesProject
ScheduleRisk RegisterResource
Calendars Agreements Organizational
Process Assets
Cost Aggregation
Reserve Analysis
Expert Judgment
Historical Relationships
Funding Limit Reconciliation
Cost Performance Baseline
Project Funding Requirements
Project Document Updates
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Funding Limit Reconciliation
The expenditure of funds should be reconciled with any funding limits on the commitment of funds for the project.
Variance between the funding limits and the planned expenditures sometimes necessitate the rescheduling of work to level out the rate of expenditures.
Can be accomplished by placing imposed date constraints for work into the project schedule.
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Cost Performance Baseline
Time-phased budget at completion (BAC) used as basis against which to measure, monitor, and control overall cost performance.
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Cost Performance Baseline
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Cost Aggregation• Reserves & risk management are important
while estimating!
– Contingency reserves: Cost Baseline the cost impacts of the remaining risk
– Management reserves: Cost Budgetextra fund to cover unforeseen risk or changes to the project
Activity estimates
Work package estimates
Control account estimates
Project estimates
Contingency reserves
Management reserves
Cost baseline
Cost Budget
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Contingency Reserves
Contingency reserves is usually percentage of total estimate or based on risk analysis, to account for the risks that are “known unknowns” of the project.
Under the control of the project manager.
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Management Reserves
Budgets reserved for unplanned, but potentially required changes to project scope. These are the risks that are “unknown unknowns”.
Under the control of organization’s management.
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Cost Budgeting
1. Activities
$75
$25 $25$25
$100 $100
$275$400
$675
$225
$900
$140
$1040
2. Work packages
3. Control Account
4. Project
5.Contingency Reserve
6.Cost Baseline
7.Management Reserve
8.Cost Budget
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Project Selection Methods
System Description
Benefit Measurement Models (Economic Models)
Analyze the predicted value of the completed projects in different ways.May present the value in terms of:
Benefit Cost Ratio (BCR)
Return on Investment (ROI)
Present Value (PV) & Net Present Value (NPV)
Internal Rate of Return (IRR)
Opportunity Cost
Mathematical Models (Constrained Optimization)
Uses different types of mathematical formulas and algorithms to determine the optimal course of action. Linear programming
Nonlinear programming
Dynamic programming
Integer Programming
Multi-objective programming
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Benefit Measurement Models (Economic Models)
Accounting Concept Description Keys for Project Selection Notes
Present value (PV)Value today of future cash flows.
The higher the PV, the better. PV= FV/(1+r)n
Net present value (NPV)Present value of cash inflow (benefits) minus present value of cash outflow (costs).
A negative NPV is unfavorable. The higher the NPV, the better.
Accounts for different project durations.
Internal rate of return (IRR)The interest rate that makes the net present value of all cash flow equal zero.
The higher the IRR, the better.
The return that a company would earn if it invests in the project.
Payback periodThe number of time periods needed to hit the break-even point.
The lower the payback period, the better.
Benefit cost ratio (BCR)
A ratio identifying the relationship between the cost and benefits of a proposed project.
A BCR less than 1 is unfavorable. The higher the BCR, the better.
Opportunity cost
The difference in return between a chosen investment and one that is passed up.
Sunk costsA cost that has been incurred and cannot be reversed.
This should not be a factor in project decisions.
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Present Value (PV) and (NPV)• Present Value (PV) – Present Value of future Cash flows. Higher the better.
• NOTE: present value and NPV are only mention once or twice on the exam
• You will not have to calculate it, nor know formula, just understand the concept
• Amount of money is always more valuable sooner than later, as this enables to take advantage of investment opportunities.
• Higher PV more preferable project. A potential investment project is selected, if value of NPV is >= ZERO
• PV = FV / (1 + i) n
• Example:
• Project X is expected to make $50,000 in two years. Project Y is expected to make to $80,000 in three years. If the cost of capital is 5 percent, which project to choose?
• Using PV formula, PV = FV / (1 + i) n , PV for Project X is $69,107 and Project Y is $45,351.
• Project Y will return the highest investment to the company and should be chosen over Project X.Ahmad Maharma PMBOK 5th Edition 340
Net Present Value
The present value of total benefits (income or revenue) minus the cost over many time periods.
Allows for comparison of many projects, to select the best to initiate.
If NPV is +ve: the investment is a good choice.
The project with highest NPV is the best.
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Net Present Value
NPV= (FV/ (1+i)n)
Where FV= Future Value
i= Interest Rate
n= Number of period intervals
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Net Present Value Example
Note that
totals are
equal, but
NPVs are
not because
of the time
value of
money
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Internal Rate of Return (IRR)• This is just another way of interpreting the benefit from the project.
• It looks at the cost of the project as the capital investment and translates the profit into the interest rate over the life of that investment.
• Calculations for IRR are not part of this certification. It is enough if you understand that the greater the value for IRR, the more beneficial the
• Example:
• You have two projects to choose from: Project A with an IRR of 21%, or project B with an IRR of 15%, which once you prefer?
• Answer: Project A.
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Internal Rate of return (IRR)
Is the interest rate at which the costs of the investment lead to the benefits of the investment.
The project with highest IRR is the best.
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Payback Period
The period of time required for the return on an investment to "repay" the sum of the original investment.
For example, a $1000 investment which returned $500 per year would have a two year payback period.
The project with lowest payback period is the best
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Payback Period
• The payback period is the length of time required to recover the initial cash outlay on the project.
• For example, if a project involves a cash outlay of 600,000$ and generates cash inflows of. 100000$, 150000$, 150000$ and 200000$ in the first, second, third and fourth years respectively,
• its pay back period is 4 years because the sum of cash flows during the four years is equal to the initial outlay. According to the payback criterion,
• the shorter the payback period, the more desirable the project.
• Payback period = cost of period or investment / Annual cash flow
• Example:
• You have two projects to choose from , Project A with payback period of 6 months or project B with payback period of 18 months, which one would you prefer?
• Answer : Project A
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Benefit Cost Ratio
• This is the value obtained by dividing the benefit by the cost.
• The greater the value, the more attractive the project
• A benefit cost ration >1 means the benefit are grater than the cost
• A benefit cost ration <1 means the cost are grater than the benefit
• A benefit cost ration =1 means the benefit are equal the cost
• For example, if the projected cost of producing a product is 10,000$, and you expect to sell it for 40,000$,
then the BCR is equal to 40,000$/10,000$, which is equal to 4. For the benefit to exceed cost, the BCR must be greater than 1.
Example:
If BCR of project A is 2.3, and the BCR of project B is 1.7, which project would you select?
Answer : Project A
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Charting the Payback Period
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Economic Value Added (EVA)
• Economic Value Added (EVA) – Value added to organization by the project
• Economic value should rarely appear in questions or choices
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Opportunity Cost.
• Opportunity cost (opportunity lost) is the NPV of the next best project, you are not doing, because you have decided to invest in a project.
• Let us assume that you have 100,000 rupees and you are investing this money in project ‘A’, whose NPV=200,000 and because of this you are unable to do project ‘B’, whose NPV=150,000 or project ‘C’, whose NPV = 120,000, then the opportunity cost is 150,000, which is the NPV of project ‘B’, which is the next best option after ‘A’.
• Example:
• You have two projects to choose from: Project A with an NPV of 45,000$, or project B with an NPV of 85,000$, what Is the opportunity cost of selecting project B ?
• Answer : 45,000$
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Sunk Cost
• Sunk Cost – Cost already incurred. This should not be taken into account while taking decision.
• Are expended costs; accounting standards that sunk costs should not be considered when deciding whether to continue with a troubled project.
Example :
You have project with an initial budget of 1,000,000 $ , you are halfway through the project and have spend 2,000,000 $, do you consider the 1,000,000 $ over budget when determining whether to continue with the project.
• Answer: NO, the money spent is gone
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Law of Diminishing return
• Law of Diminishing return – After a point, adding more resources will not have proportional benefit.
• Example:
• A single programmer may produce at 1 module per hour. With second a programmer the two may produce 1.75 module/ hour. With third programmer, the group may produce 2.25 modules/ hour
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Working Capital
• Working Capital – Current assets minus current liabilities.
The amount of money the company has available to invest, including investmentin project
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Depreciation• Depreciation – Assets loose value over useful life.
• Depreciation methods based on timeStraight line methodDeclining balance methodSum-of-the-years'-digits method
Depreciation based on use (activity)
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Straight line depreciation• Depreciation = (Cost - Residual value) / Useful life
[Example, Straight line depreciation]
On April 1, 2011, Company A purchased an equipment at the cost of $140,000. This equipment is estimated to have 5 year useful life. At the end of the 5th year, the salvage value (residual value) will be $20,000. Company A recognizes depreciation to the nearest whole month. Calculate the depreciation expenses for 2011, 2012 and 2013 using straight line depreciation method.
Depreciation for 2011= ($140,000 - $20,000) x 1/5 x 9/12 = $18,000
Depreciation for 2012= ($140,000 - $20,000) x 1/5 x 12/12 = $24,000
Depreciation for 2013= ($140,000 - $20,000) x 1/5 x 12/12 = $24,000
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Double declining balance depreciation
YearBook Value
at the beginningDepreciation
RateDepreciation
ExpenseBook Value at the year-end
2011 $140,000 40%
2012
2013
2014
2015
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Double declining balance depreciation
(*1) $140,000 x 40% x 9/12 = $42,000
(*2) $98,000 x 40% x 12/12 = $39,200
(*3) $58,800 x 40% x 12/12 = $23,520
(*4) $35,280 x 40% x 12/12 = $14,112
(*5) $21,168 x 40% x 12/12 = $8,467
--> Depreciation for 2015 is $1,168 to keep book value same as
salvage value.
--> $21,168 - $20,000 = $1,168 (At this point, depreciation stops.)
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Double declining balance depreciation
YearBook Value
at the beginningDepreciation
RateDepreciation
ExpenseBook Value at the year-end
2011 $140,000 40% $42,000 (*1) $98,000
2012 $98,000 40% $39,200 (*2) $58,800
2013 $58,800 40% $23,520 (*3) $35,280
2014 $35,280 40% $14,112 (*4) $21,168
2015 $21,168 40% $1,168 (*5) $20,000
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Sum-of-the-years-digits method
Depreciation expense = (Cost - Salvage value) x FractionFraction for the first year = n / (1+2+3+...+ n)Fraction for the second year = (n-1) / (1+2+3+...+ n)Fraction for the third year = (n-2) / (1+2+3+...+ n)...
Fraction for the last year = 1 / (1+2+3+...+ n)
n represents the number of years for useful life.
[Example, Sum-of-the-years-digits method]
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Sum-of-the-years-digits method
[Example, Sum-of-the-years-digits method]
Company A purchased the following asset on January 1, 2011.What is the amount of depreciation expense for the year ended December 31, 2011?Acquisition cost of the asset --> $100,000Useful life of the asset --> 5 yearsResidual value (or salvage value) at the end of useful life --> $10,000Depreciation method --> sum-of-the-years'-digits method
Calculation of depreciation expenseSum of the years' digits = 1+2+3+4+5 = 15Depreciation for 2011 = ($100,000 - $10,000) x 5/15 = $30,000Depreciation for 2012 = ($100,000 - $10,000) x 4/15 = $24,000Depreciation for 2013 = ($100,000 - $10,000) x 3/15 = $18,000Depreciation for 2014 = ($100,000 - $10,000) x 2/15 = $12,000Depreciation for 2015 = ($100,000 - $10,000) x 1/15 = $6,000
Sum of the years' digits for n years = 1 + 2 + 3 + ...... + (n-1) + n = (n+1) x (n / 2)
Sum of the years' digits for 500 years = 1 + 2 + 3 + ...... + 499 + 500 = (500 + 1) x (500 / 2) = (501 x 500) / 2 = 125,250
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Project selection methods – exercise
Accounting Concept Project A Project B Answer
Net present value (NPV) 1,000,000 $ 75,000 $
Internal rate of return (IRR) 13 % 17 %
Payback period 16 months 18 months
Benefit cost ratio (BCR) 2.27 1.3
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Project selection methods – exercise
Accounting Concept Project A Project B Answer
Net present value (NPV) 1,000,000 $ 75,000 $ A
Internal rate of return (IRR) 13 % 17 % B
Payback period 16 months 18 months A
Benefit cost ratio (BCR) 2.27 1.3 A
Ahmad Maharma PMBOK 5th Edition 363
PMBOK Reading
Chapter 7
- Sections 7.1 - 7.3
Ahmad Maharma PMBOK 5th Edition 364
Project Management Professional
PMP®
Phase #2: PROJECT PLANNING
Chapter 8: Quality / 8.1 Plan Quality Management
What is Quality?
Conformance to Requirements
Fitness of use
According to PMBOK
“The degree to which a set of inherent characteristics fulfill requirements.”
Ahmad Maharma PMBOK 5th Edition 366
Project Quality Management
Plan Quality
Management
Ahmad Maharma PMBOK 5th Edition 367
Quality Management & Project Management
Both disciplines recognize the importance of:
Customer Satisfaction
Prevention over inspection
Management Responsibility
Continuous Improvement
Ahmad Maharma PMBOK 5th Edition 368
Quality Concepts
Quality vs. Grade
Precision vs. Accuracy
Quality Assurance vs. Quality Control
Ahmad Maharma PMBOK 5th Edition 369
Quality Vs. Grade
Quality is the “Degree to which a set of inherent characteristics fulfill requirements”
Grade is “ Category assigned to products or services having the same functional use but different technical characteristics”.
Low grade does not necessarily cause a problem, but low quality does.
Ahmad Maharma PMBOK 5th Edition 370
Precision vs. Accuracy
Precision is consistency that the value of repeated measurements are clustered and have little scatter.
Accuracy means that the measured value is very close to the true value.
Precise measurements are not necessarily accurate. A very accurate measurement is not necessarily precise.
Ahmad Maharma PMBOK 5th Edition 371
Ahmad Maharma PMBOK 5th Edition 372
Quality Assurance vs. Quality Control
Quality Assurance is applying the planned, systematic quality activities to ensure that the project employs all processes needed to meet requirements.
Quality Control is the action of monitoring specific project results to determine whether they comply with relevant quality standards and identifying ways to eliminate causes of unsatisfactory performance.
Ahmad Maharma PMBOK 5th Edition 373
Project Quality Management
Plan Quality
Management
Ahmad Maharma PMBOK 5th Edition 374
Plan Quality Management
Identifying which quality Standards are relevant to the project and determining how to satisfy them
Scope statement
Quality policies
Quality standards & regulations in the company, industry.
Quality is planned, designed and built in- not inspected in.
Ahmad Maharma PMBOK 5th Edition 375
Plan Quality
Project Management Plan
Stakeholder Register
Risk Register
Requirements Documentation
Enterprise Environmental Factors
Org. Process Assets
Cost/ Benefit Analysis Cost of Quality (COQ) Seven Basic Quality ToolsBenchmarking Design of ExperimentsStatistical SamplingAdditional Quality Planning Tools Meetings
Quality Management Plan
Quality Metrics
Quality Checklists
Process Improvement Plan
Project Document Updates
Ahmad Maharma PMBOK 5th Edition 376
Seven Basic Quality Tools
1. Cause & Effect Diagram
2. Flowcharts
3. Checksheets
4. Pareto Diagrams
5. Histograms
6. Control Charts
7. Scatter Diagrams
Ahmad Maharma PMBOK 5th Edition 377
Cause & Effect Diagram
Also known as “Fish-Bone Analysis” or “Ishikawa Analysis”
Used to identify the problem, discover the underlying causes leading to it, and develop solutions and preventive actions.
Ahmad Maharma PMBOK 5th Edition 378
Cause & Effect Diagram
Ahmad Maharma PMBOK 5th Edition 379
Flowcharting
Diagram that shows the relationship between different elements in a system of processes
Used to assist team efforts in identifying potential quality problems and the possible affects of those problems.
Cause & Affect Diagram
Process flowcharts
Ahmad Maharma PMBOK 5th Edition 380
Ahmad Maharma PMBOK 5th Edition 381
ChecksheetsCategory Strokes Frequency
Attribute 1
Attribute 2
Attribute 3
Attribute 4
Ahmad Maharma PMBOK 5th Edition 382
Control Charts
Graphic display of results, over time, of a process.
Used to determine if the process is “in control”. When a process is “in control” it should not be adjusted.
“Rule of Seven”
Ahmad Maharma PMBOK 5th Edition 383
Ahmad Maharma PMBOK 5th Edition 384
Histogram
A vertical bar chart showing how often a particular variable state occurred.
Ahmad Maharma PMBOK 5th Edition 385
Histograms
Ahmad Maharma PMBOK 5th Edition 386
Pareto Diagrams
Histogram, ordered by frequency of occurrence, that shows how many results were generated by type or categories of identified cause.
Rank ordering is used to guide corrective actions – fix the problems that are causing the greatest number of defects first.
Relates to Pareto’s Law & Principle of 80/20
Ahmad Maharma PMBOK 5th Edition 387
Pareto Diagram
Ahmad Maharma PMBOK 5th Edition 388
Scatter Diagram
A Scatter diagram shows the relationship between two variables.
Allows to study and identify the possible relationship between changes observed in two variables.
Ahmad Maharma PMBOK 5th Edition 389
Scatter Diagram
Ahmad Maharma PMBOK 5th Edition 390
BENCHMARKING
The evaluation of a groups’ business or project practices in comparison to those of other groups or projects.
Includes a number of quantitative or qualitative attributes that can be assessed in both the benchmark and the subject.
Ahmad Maharma PMBOK 5th Edition 391
Cost of Quality
Prevention costs – up front costs to design and plan for quality.
Appraisal costs – associated with evaluation of results to make sure that they conform to quality.
Internal Failure costs – Cost of re-work associated with items that did not pass the appraisal.
External Failure costs – Cost of failures found by the customer.
Ahmad Maharma PMBOK 5th Edition 392
Cost of Quality
Conformance:
Training.
Research.
Surveys.
Nonconformance:
Scrap.
Rework.
Warranty.
Inventory.
Ahmad Maharma PMBOK 5th Edition 393
Check Lists
Job aid that prompts employees to perform activities according to a consistent quality standard.
Could be for quality assurance or quality control.
Two types of Checklists:
Imperative
Interrogative
Ahmad Maharma PMBOK 5th Edition 394
Design of Experiments
A structured, organized method that is used to determine the relationship between the different factors affecting a process and the output of that process.
It involves designing a set of ten to twenty experiments, in which all relevant factors are varied systematically.
The results of these experiments are analyzed, to help identify optimal conditions
Ahmad Maharma PMBOK 5th Edition 395
Quality Management Plan
Describes how the project team will implement the performing organization’s quality policy
Ahmad Maharma PMBOK 5th Edition 396
Quality Management Plan Contents
Purpose
Quality Policy/ Standards
Quality Assurance Procedures & Test
Quality Control Procedures & Tests
Roles & Responsibilities
Ahmad Maharma PMBOK 5th Edition 397
Process Improvement Plan
Process Boundaries
Process Configuration
Process Metrics
Targets for Improved Performance
Ahmad Maharma PMBOK 5th Edition 398
PMBOK Reading
Chapter 8
- Section 8.1
Ahmad Maharma PMBOK 5th Edition 399
Project Management Professional
PMP®
Phase #2: PROJECT PLANNING
Chapter 9: HR / 9.1 Plan HR Management
Project Human resource Management
Plan Human
ResourceManagement
Ahmad Maharma PMBOK 5th Edition 401
Plan Human Resource Management
Identifying, documenting, and assigning project roles, responsibilities, required skills and reporting relationships, as well as creating the staffing management plan.
Identifying who we want, at which skill level, when, and for how long. Specifying their roles, and responsibilities and interactions.
Ahmad Maharma PMBOK 5th Edition 402
Develop Human Resource Plan
Project Management Plan
Activity Resource Requirements
Enterprise Environmental Factors
Org. Process Assets
Organization Charts & Position descriptions
Networking
Organizational Theory
Expert Judgment
Meetings
Human ResourceManagementPlan
Ahmad Maharma PMBOK 5th Edition 403
Organizational Charts & Position Descriptions
Hierarchical- type Charts
Matrix-based Charts
Text-Oriented Formats
Ahmad Maharma PMBOK 5th Edition 404
Organizational Charts & Position Descriptions
Ahmad Maharma PMBOK 5th Edition 405
Responsibility Assignment Matrix (RAM)
Activity Ann Ben Carlos Dina Ed
Define A R I I I
Design I A R C C
Develop I A R C C
Test A I I R I
R= ResponsibleA=Accountable C=Consult I=InformAhmad Maharma PMBOK 5th Edition 406
Organizational Theory
Provides information regarding the ways that people, teams and organizational units behave.
Ahmad Maharma PMBOK 5th Edition 407
Halo Effect
The tendency to rate high or low on all factors due to the impression of a high or low rating on some specific factor.
Ahmad Maharma PMBOK 5th Edition 408
Team Building Activities (Tools & Techniques)
Tuckman’s stage of team formation and development:1. FORMING
– The team meets and learns about the project and what their roles and responsibilities.
2. STORMING
– Address the project work, technical decisions and the project management approach.
Conflict/disagreement may occurs.
3. NORMING
– Work together and adjust work habits and behavior that support the team.
4. PERFORMING
– Being a well-organized unit
5. ADJOURNING
– Team completes the work and move on from the project.
Ahmad Maharma PMBOK 5th Edition 409
Motivation Theory: Maslow’s Hierarchy of Needs
Image source: http://theskooloflife.com/wordpress/self-actualization-in-the-maslow-hierarchy/
Basic Needs
Higher Level of Needs
Ahmad Maharma PMBOK 5th Edition 410
Motivation Theory: McGregor’s X & Y Theory
• Theory X
– People tends to be negative, passive
e.g. incapable, avoid responsibility, need
to be watched
– Extrinsic Motivation
•Theory Y
–People tends to be positive e.g. want to achieve, willing to work without
supervision, can direct their own effort
–Intrinsic Motivation
Ahmad Maharma PMBOK 5th Edition 411
Motivation Theory: Acquired Needs Theory
• David McClelland’s Theory
People are motivated by one of the three needsNeeds Behavioral Style
Achievement
(N-Ach)
These people should be given projects that are
challenging but are reachable
They like recognition
Affiliation
(N-Affil)
These people work best when cooperating with
others
They seek approval rather than recognition
Power
(N-Pow)
People whose need for power is socially
oriented, should be allowed to manager others
These people like to organize and influence
others
Ahmad Maharma PMBOK 5th Edition 412
Motivation Theory: Two Factors Theory
• Herzberg’s Theory– Job dissatisfaction due to lack of hygiene factors
– Job satisfaction due to motivation factors
Hygiene Factors
- Working condition- Salary- Personal life- Relationship at work- Security- Status
Motivation Factors
- Responsibility- Self actualization- Professional growth- Recognition
Ahmad Maharma PMBOK 5th Edition 413
Human Resource Plan
Provides guidance on how project human resources should be defined, staffed, managed, controlled, and eventually released.
Ahmad Maharma PMBOK 5th Edition 414
Human Resource Plan Contents
Roles and Responsibilities
Project Organization Charts
Staffing Management Plan
Ahmad Maharma PMBOK 5th Edition 415
Staffing Management Plan
Staff acquisition
Resource Calendars
Staff Release Plan
Training needs
Recognition & Rewards
Compliance
Safety
Ahmad Maharma PMBOK 5th Edition 416
PMBOK Reading
Chapter 9
- Section 9.1
Ahmad Maharma PMBOK 5th Edition 417
Project Management Professional
PMP®
Phase #2: PROJECT PLANNING
Chapter 10: Communications / 8.1 Plan Communications
Management
Project Communications Management
Plan Communications
Management
Ahmad Maharma PMBOK 5th Edition 419
Consequences of Miscommunication
Ahmad Maharma PMBOK 5th Edition 420
Plan Communication
The process of determining the project stakeholder information needs and defining a communication approach.
Who needs what information,
When will they need it,
In which format,
How will it be given to them,
How frequently.
Ahmad Maharma PMBOK 5th Edition 421
Communication Body of Knowledge
Communication Process
Choice of Media
Documentation Skills
Presentation Skills
Meeting Management
Clutter, Noise, & Barriers
Ahmad Maharma PMBOK 5th Edition 422
Effective Communication
Effective Communication
Non Verbal
Para lingual
Feedback
Effective Listening
Feedback
Active Listening
Para lingual
Ahmad Maharma PMBOK 5th Edition 423
Communication Methods
Method When Used
Formal Written Complex Problems, PM Plans, Charter, Long Distance Communication
Formal Verbal Presentations, Speeches
Informal Written Memos, e-mails, notes
Informal Verbal Meetings, Conversations
Ahmad Maharma PMBOK 5th Edition 424
Plan Communications Management
Project Management Plan
Stakeholder Register
Enterprise environmental factors
Organizational Process Assets
Communication Requirements Analysis
Communication technology
Communication Models
Communication Methods
Meetings
Communications Management Plan
Project Documents Updates
Ahmad Maharma PMBOK 5th Edition 425
Communication Requirements Analysis
Determining the communication requirements of the project stakeholders.
Defined by combining the type and format of information needed with an analysis of the value of that information.
Project resources are expended only on communicating information that contribute to success, or where a lack of communication can lead to failure.
Ahmad Maharma PMBOK 5th Edition 426
Number of Communication Channels
N (N-1)/2
Ahmad Maharma PMBOK 5th Edition 427
Communication technology
Factors that affect the project communication technology:
Urgency of the need for information.
Availability of technology
Expected project staffing
Duration of the project
Project Environment
Ahmad Maharma PMBOK 5th Edition 428
Communication Models
Sender ReceiverMedium
Message
Feedback –Message
Noise
Noise
AcknowledgeMessageNoise
Ahmad Maharma PMBOK 5th Edition 429
Communication Models
Interactive
Push
Pull
Ahmad Maharma PMBOK 5th Edition 430
Communication Management Plan
Stakeholder communication requirements
Information to be communicated
Reason for distribution
Responsibility
Recipients
Methods and technologies used
Frequency
Resources allocated for communication (including time and budget)
Escalation process
Method for updating
Glossary of terminology
Information flow in the project (flow chart)
Communication constraintsAhmad Maharma PMBOK 5th Edition 431
Communication Matrix
What Why By Whom Recipient When How
Status
report
Performanc
e reporting
PM Sponsor/
Steering
Committee
Weekly
basis
Minutes of
meeting
Reporting
decisions
PC Steering
Committee
After each
meeting
Risk forms Report &
document
risks
Any
stakeholder
PM As needed Email
Risks log Updating
risks log
Risk
Manager
Steering
Committee
Every two
weeks
Meeting &
Ahmad Maharma PMBOK 5th Edition 432
PMBOK Reading
Chapter 10
- Section 10.1
Ahmad Maharma PMBOK 5th Edition 433
Project Management Professional
PMP®
Phase #2: PROJECT PLANNING
Chapter 11: Risk/ 11.1 Plan Risk Management
Is Risk Good Or Bad?
Ahmad Maharma PMBOK 5th Edition 435
Risk…
Negative
Threat
Positive
Opportunity
Ahmad Maharma PMBOK 5th Edition 436
Ahmad Maharma PMBOK 5th Edition 437
Risk Definition
Risk: an uncertain event that, if it occurs, has a positive or negative effect on a project’s deliverables.
Ahmad Maharma PMBOK 5th Edition 438
Project Risk Management
The systematic process of identifying, analyzing, and responding, monitoring, and controlling project risks
Ahmad Maharma PMBOK 5th Edition 439
Project Risk Planning
Plan Risk Management
Plan Risk Responses
Perform Quantitative
RiskAnalysis
IdentifyRisks
Perform Qualitative
RiskAnalysis
Ahmad Maharma PMBOK 5th Edition 440
Plan Risk Management
PlanRisk
Management
Plan Risk Responses
Perform Quantitative
RiskAnalysis
IdentifyRisks
Perform Qualitative
RiskAnalysis
Ahmad Maharma PMBOK 5th Edition 441
Plan Risk Management
Deciding how to conduct risk management activities for a project.
Ahmad Maharma PMBOK 5th Edition 442
Plan Risk Management
Project Management Plan
Project Charter
Stakeholder Register
Enterprise Environmental factors
Org. Process Assets
Analytical Techniques
Expert Judgment
Meetings
Risk Management Plan
Ahmad Maharma PMBOK 5th Edition 443
Risk Management Plan
Describes how risk management will be structured and performed on the project.
A subset of the project management plan.
Ahmad Maharma PMBOK 5th Edition 444
Risk Management Plan
Methodology.
Roles and responsibilities.
Budgeting.
Timing.
Risk categories.
Definitions of risk probability and impact.
Probability and impact matrix.
Revised stakeholders’ tolerances.
Reporting formats.
Tracking.
Ahmad Maharma PMBOK 5th Edition 445
Risk Categories
Ahmad Maharma PMBOK 5th Edition 446
Definition of Risk Probability & Impact
Ahmad Maharma PMBOK 5th Edition 447
Exercise
Ahmad Maharma PMBOK 5th Edition 448
Expected Monetary Value
Ahmad Maharma PMBOK 5th Edition 449
Expected Monetary Value
Ahmad Maharma PMBOK 5th Edition 450
Impact Scale
Cardinal
Linear
Non-Linear
Ordinal
Ahmad Maharma PMBOK 5th Edition 451
Impact Scale
Cardinal Linear (0.1, 0.3, 0.7, 0.9)
Cardinal Non-Linear (.05, .1, .2, .4, .8).
Cardinal Non-Linear is used to reflect focus on high risks.
Ordinal (Very Low, Low, Medium, High, Very High)
Ahmad Maharma PMBOK 5th Edition 452
Probability Scale
Cardinal Linear (0.05, 0.1,0.2…etc.)
Ordinal (Very unlikely, unlikely, moderate, likely, very likely, almost certain)
Ahmad Maharma PMBOK 5th Edition 453
Probability-Impact Matrix
Each risk is rated on its probability of occurring and impact on an objective if it does occur.
The matrix shows low, moderate or high risks.
Risk Score= risk probability x risk impact
Ahmad Maharma PMBOK 5th Edition 454
Probability-Impact Matrix (Cardinal)
Ahmad Maharma PMBOK 5th Edition 455
Probability-Impact Matrix (Ordinal)
Ahmad Maharma PMBOK 5th Edition 456
Identify Risks
Determining which risks may affect the project and documenting their characteristics.
Ahmad Maharma PMBOK 5th Edition 457
Project Management Professional
PMP®
Phase #2: PROJECT PLANNING
Chapter 11: Risk/ 11.2 Identify Risks
Identify Risks
PlanRisk
Management
Plan Risk Responses
Perform Quantitative
RiskAnalysis
IdentifyRisks
Perform Qualitative
RiskAnalysis
Ahmad Maharma PMBOK 5th Edition 459
Identify Risks
Risk Management Plan Activity Cost Estimates Activity Duration
Estimates Scope Baseline Stakeholder Register Cost Management Plan Schedule Management
Plan Quality Management
Plan Human Resource Plan Project Documents Procurement
Documents Enterprise
Environmental Factors Org. Process Assets
DocumentationReview Information
Gathering Techniques Checklist Analysis Assumptions
analysis Diagramming
Techniques SWOT Analysis Expert Judgment
Risk Register
Ahmad Maharma PMBOK 5th Edition 460
Documentation Review
Structured review of project documentation, including plans, assumptions, previous project files, contracts and other information at project level and detailed scope levels.
Ahmad Maharma PMBOK 5th Edition 461
Information Gathering Techniques
Brainstorming
Delphi Technique
Interviewing
Root cause analysis
Ahmad Maharma PMBOK 5th Edition 462
Brainstorming
A group creativity technique designed to generate a large number of ideas for the solution of a problem.
Everyone is allowed to express ideas freely and without criticism.
Ahmad Maharma PMBOK 5th Edition 463
Delphi Technique
A way to reach a consensus of experts who participate anonymously.
A facilitator uses a questionnaire to solicit ideas about the important risks.
Eliminates biasness and influence of individuals
Ahmad Maharma PMBOK 5th Edition 464
Interviewing
Interviewing experienced project participants, stakeholders, and subject matter experts to identify risks.
Ahmad Maharma PMBOK 5th Edition 465
Root Cause Analysis
Also known as “Fish-Bone Analysis” or “Ishikawa Analysis”
Used to identify the problem, discover the underlying causes leading to it, and develop solutions and preventive actions.
Ahmad Maharma PMBOK 5th Edition 466
Root Cause Analysis
Ahmad Maharma PMBOK 5th Edition 467
Checklist Analysis
Based on historical and project information.
Must be exhaustive (very difficult).
Important to review at project closure to improve on the checklist for future projects.
One of the easier more common first steps.
Can be grouped into categories.
Ahmad Maharma PMBOK 5th Edition 468
Assumptions Analysis
Review project assumptions.
Explores the validity of assumptions as they apply to the project.
Identifies risks to the project from inaccuracy, inconsistency, or incompleteness of assumptions.
Ahmad Maharma PMBOK 5th Edition 469
SWOT Analysis
Internal Factors
Strengths.
Weaknesses.
External Factors
Opportunities.
Threats.
Ahmad Maharma PMBOK 5th Edition 470
Risk Register
A document that contains the outcomes of risk planning.
At this stage includes:
List of identified risks.
List of potential scenarios.
Risk triggers
Ahmad Maharma PMBOK 5th Edition 471
Project Management Professional
PMP®
Phase #2: PROJECT PLANNING
Chapter 11: Risk/ 11.3 Perform Qualitative Risk Analysis
Perform Qualitative Risk Analysis
PlanRisk
Management
Plan Risk Responses
Perform Quantitative
RiskAnalysis
IdentifyRisks
Perform Qualitative
RiskAnalysis
Ahmad Maharma PMBOK 5th Edition 473
Perform Qualitative Risk Analysis
Prioritizing risks for further analysis or action by assessing and combining their probability of occurrence and impact.
Assesses the priority of identified risks using their relative probability or likelihood of occurrence.
Ahmad Maharma PMBOK 5th Edition 474
Perform Qualitative Risk Analysis
Risk Management Plan
Risk Register
Risk Management Plan
Project Scope Statement
Organizational Process Assets
Risk Probability and Impact Assessment
Probability and Impact Matrix
Risk Data quality assessment
Risk Categorization
Risk Urgency Assessment
Expert Judgment
Project Documents Updates
Ahmad Maharma PMBOK 5th Edition 475
Risk register Updates
Relative ranking or priority list of project risks.
Risks grouped by categories.
Causes of risk or project areas requiring particular attention.
List of risks requiring responses in the near-term.
List of risks for additional analysis and responses.
Watchlists of low-priority risks.
Trends in qualitative risk analysis results.
Ahmad Maharma PMBOK 5th Edition 476
Perform Quantitative Risk Analysis
The process of numerically analyzing the effect of identified risks on overall project objectives.
Performed on risks that have been prioritized by the qualitative analysis.
Ahmad Maharma PMBOK 5th Edition 477
Outcomes of Quantitative Risk Analysis
Quantify possible outcomes and their probability.
Assess probability of achieving a specific objective.
Identify risks requiring most attention.
Identify realistic and achievable targets.
Determine best decision under uncertainty.
Ahmad Maharma PMBOK 5th Edition 478
Project Management Professional
PMP®
Phase #2: PROJECT PLANNING
Chapter 11: Risk/ 11.4 Perform Quantitative Risk Analysis
Perform Quantitative Risk Analysis
PlanRisk
Management
Plan Risk Responses
Perform Quantitative
RiskAnalysis
IdentifyRisks
Perform Qualitative
RiskAnalysis
Ahmad Maharma PMBOK 5th Edition 480
Perform Quantitative Risk Analysis
Risk RegisterRisk
Management PlanCost
Management PlanSchedule
Management PlanEnterprise
Environmental FactorsOrganizational
Process Assets
Data Gathering and Representation Techniques
Quantitative Risk Analysis and Modeling Techniques
Expert Judgment
Project DocumentsUpdates
Ahmad Maharma PMBOK 5th Edition 481
Data Gathering and Representation Techniques
Interviewing.
Probability distributions.
Ahmad Maharma PMBOK 5th Edition 482
Quantitative Risk Analysis and Modeling Techniques
Sensitivity Analysis
Expected Monetary Value Analysis
Modeling and Simulation
Ahmad Maharma PMBOK 5th Edition 483
Sensitivity Analysis
Helps to determine which risks have the most potential impact on the project.
It examines the extent to which the uncertainty of each project element affects the objectives being examined when all other uncertain elements are held at their baseline value.
Ahmad Maharma PMBOK 5th Edition 484
Expected Monetary Value (EMV)
Statistical concept that calculates the average outcomes when the future includes scenarios that may or may not happen (i.e. analysis under uncertainty).
The EMV of opportunities will generally be expressed in positive values while those of threats in negative values.
Calculated by multiplying the value of each possible outcome by its probability of occurrence, and adding them together.
Ahmad Maharma PMBOK 5th Edition 485
Expected Monetary Value (EMV) EMV = Σ Probability X Impact
All possible
outcomes
of a decision
Work Package
Probability Impact EMV
A 10% -$ 20,000 -$2,000
B 30% $45,000 $13,500
C 68% -$18,000 -$12,240
Total -$ 740
Ahmad Maharma PMBOK 5th Edition 486
Decision Tree Analysis
Graphical means of displaying all available options, their probability, and their impact, to reach the final project objective.
Ahmad Maharma PMBOK 5th Edition 487
Decision Tree Analysis
$335
$550
EMV In house = (1000 – 150) * 0.5 + ( -30 – 150) * 0.5 = $ 335
EMV out source = (1000 – 250) * 0.8 + ( 0 – 250) * 0.2 = $ 550
Ahmad Maharma PMBOK 5th Edition 488
Ahmad Maharma PMBOK 5th Edition 489
Modeling & Simulation
Uses Monte Carlo Technique
A computerized technique that uses sampling from a random number sequence to simulate characteristics or events or outcomes with multiple possible values.
Used to generate probable outcomes based on estimates processed / iterated thousands of times.
Ahmad Maharma PMBOK 5th Edition 490
Modeling & Simulation
Provides probable project results and information for project decision-making.
For Cost Risk Analysis, use cost estimates.
For Schedule Risk Analysis, use the schedule network diagram and duration estimates.
Illustrates the likelihood of achieving specific cost / schedule targets.
Ahmad Maharma PMBOK 5th Edition 491
Monte Carlo Simulation
Ahmad Maharma PMBOK 5th Edition 492
Monte Carlo Simulation
Mean=$46.67m
Cost
Pro
bab
ility
(C
um
ula
tive
)
100%
75%
50%
25%
0%
$30m $38.75m $47.5m $56.25m $65m
$41m $50m
12%
Ahmad Maharma PMBOK 5th Edition 493
Project Management Professional
PMP®
Phase #2: PROJECT PLANNING
Chapter 11: Risk/ 11.5 Plan Risk Responses
Plan Risk Responses
The process of developing options and actions to enhance opportunities an to reduce threats to project objectives.
Ahmad Maharma PMBOK 5th Edition 495
Plan Risk Responses
PlanRisk
Management
Plan Risk Responses
Perform Quantitative
RiskAnalysis
IdentifyRisks
Perform Qualitative
RiskAnalysis
Ahmad Maharma PMBOK 5th Edition 496
Plan Risk Responses
Risk Management Plan
Risk Register
Strategies for Negative Risks or Threats
Strategies for Positive Risks or Opportunities
Contingent Response Strategies
Expert judgment
Project Management Plan updates
Project Documents Updates
Ahmad Maharma PMBOK 5th Edition 497
Responses for Negative Risks (Threats)
Avoidance.
Transference.
Mitigation.
Acceptance.
Ahmad Maharma PMBOK 5th Edition 498
Avoidance
Changing project plan to eliminate the risk or condition or to protect the project objectives from its impact.
Ahmad Maharma PMBOK 5th Edition 499
Transference
Shifting some or all of the negative impact, along with ownership of the response to a third party.
Examples of transference:
Insurance
Warranties
Guaranties
Performance bonds
Transfers risk, but does not eliminate it.
Ahmad Maharma PMBOK 5th Edition 500
Mitigation
Reducing probability and/ or impact of risk to an acceptable level.
Does not eliminate risk completely.
Mitigates probability and/ or impact.
Ahmad Maharma PMBOK 5th Edition 501
Acceptance
Deciding not to change the project plan, to deal with a risk, or being unable to identify suitable response strategy.
Includes active and passive acceptance:
Active acceptance: developing a contingency plan if risk occurs.
Passive acceptance: no action is taken until risk happens.
Ahmad Maharma PMBOK 5th Edition 502
Responses for positive risks (Opportunities)
Exploit (vs. Avoid).
Share (vs. Transfer).
Enhance (vs. Mitigate).
Accept. (The same)
Ahmad Maharma PMBOK 5th Edition 503
Outcomes From Risk Response Planning
Residual Risk: Those that remain after avoidance, transfer or mitigation responses have been taken.
Secondary Risk: That arise as a direct result of implementing a risk response.
Contingency reserve needed: The amount of buffer needed to reduce the risk of over runs.
Ahmad Maharma PMBOK 5th Edition 504
Exercise
Ahmad Maharma PMBOK 5th Edition 505
Exercise
Ahmad Maharma PMBOK 5th Edition 506
Exercise
Ahmad Maharma PMBOK 5th Edition 507
Exercise
Ahmad Maharma PMBOK 5th Edition 508
PMBOK Reading
Chapter 11
- Section 11.1 - 11.5
Ahmad Maharma PMBOK 5th Edition 509
Project Management Professional
PMP®
Phase #2: PROJECT PLANNING
Chapter 12: Procurement / 12.1 Plan Procurement
Management
Project ProcurementManagement
The processes necessary to purchase or acquire products, services or results from outside the project team.
Includes the contract management and change control processes required to develop and administer contracts.
Includes also administering any contracts issued by an outside organization (the buyer) that is acquiring the project from the performing organization (the seller).
Ahmad Maharma PMBOK 5th Edition 511
Project ProcurementManagement
The organization, can be the buyer or seller of the product, service or result under a contract.
Contract can be called:
Agreement.
Subcontract.
Purchase order.
Ahmad Maharma PMBOK 5th Edition 512
Project Procurement Management
Seller can be called:
Contractor
Subcontractor
Vendor
Service provider
Supplier
Buyer can be called:
Client
Customer
Service requester
Purchaser
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Seller in a project
Bidder Selected Source
Contractor, Supplier or Vendor
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Project Procurement Management
PlanProcurementManagement
Conductprocurements
ControlProcurements
CloseProcurements
Ahmad Maharma PMBOK 5th Edition 515
Plan Procurements Management
PlanProcurements Management
Conductprocurements
ControlProcurements
CloseProcurements
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Plan Procurements
The process of documenting project purchasing decisions, specifying the approach, and identifying potential sellers.
Should be accomplished during the scope definition effort to specify:
Whether to procure or not?
How to procure?
What to procure?
How much to procure?
When to procure?
Ahmad Maharma PMBOK 5th Edition 517
Project Manager’s Authority in Procurement
It depends on the type of the contracting environment:
Centralized Contracting Environment
There is a procurement department & a procurement manager who handle all procurements
The project Manager contacts the procurement manager when he/she needs help regarding procurement
Decentralized Contracting Environment
There’s no procurement department
The project manager hires a procurement manager to work full time on procurement & he will be reporting directly to the Project Manager
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Because they are part of the
procurement department that
focuses only on procurement,
they have high level of expertise
It provides its employees with
continuous improvement,
training & shared lessons
learned
They are more efficient & helpful
in understanding the manager’s
requirement in procurement
Employees have clear &
defined career path in
procurement profession
One procurement manager may
work on many projects, so the
attention will be divided among
many procurement projects
It may be more difficult for the
project manager to obtain
contracting help when needed
The project manager will not
have a full authority in the
procurement project
Centralized Contracting Environment
Advantages Disadvantages
Ahmad Maharma PMBOK 5th Edition 519
The project manager has easier
access to contracting expertise
because the procurement
manager is a member of the team
The procurement manager has
more loyalty to the project
There is no “home” department for
the procurement manager to
return to after the project is
completed
It’s more difficult to maintain a high
level of contracting expertise in the
company because there’s no
procurement department
There may be an inefficient use of
procurement resources in projects
across the organization
There may be a little
standardization of procurement
practice from one project to the
next
No career path as a procurement
manager
Decentralized Contracting Environment
Advantages Disadvantages
Ahmad Maharma PMBOK 5th Edition 520
Plan Procurements
Project Management PlanRequirements
DocumentationRisk Register Activity Resource
Requirements Project Schedule Activity Cost
Estimates Stakeholder
Register Enterprise
Environmental FactorsOrganizational
Process Assets
Make-or-Buy Analysis
Expert Judgment
Contract Types
Meetings
Procurement Management Plan Procurements
Statement of Work Make-or-Buy
Decisions Procurement
Documents Source Selection
Criteria Change Requests Project
Documents Updates
Ahmad Maharma PMBOK 5th Edition 521
Make-or-Buy Analysis
A technique used to determine whether particular work can best be accomplished by the project team or must be purchased from outside sources.
If buy: Purchase or lease?
Should consider all related costs; direct and indirect.
Ahmad Maharma PMBOK 5th Edition 522
12.1.2 Plan Procurements – Tools and Techniques
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Contract Types
Fixed price
Cost reimbursable
Time and material
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Fixed Price Contracts
The most common type.
A total lump sum price against a well-defined product.
Three types:
Firm Fixed Price Contracts (FFP)
Fixed Price Incentive Fee Contracts (FPIF)
Fixed Price with Economic Price Adjustment Contracts (FP-EPA)
Ahmad Maharma PMBOK 5th Edition 525
Fixed Price Contracts
The most common type.
The buyer knows the price from the beginning.
Risk is on the seller
The buyer must prepare a detailed SOW ( more work on the buyer)
The seller might try not to do everything according to the SOW if he started loosing money
More cost on the buyer
Advantages:
Disadvantages:
Ahmad Maharma PMBOK 5th Edition 526
Cost reimbursable Contracts
Paying the seller the actual cost, plus a fee.
Three types:
Cost-plus-fixed-fee (CPFF)
Cost plus incentive fee (CPIF)
Cost plus award fee (CPAF).
Ahmad Maharma PMBOK 5th Edition 527
Cost reimbursable Contracts
No detailed SOW.
Less cost on the buyer than the FPC
Total cost is unknown
Risk is on the buyer
More work on the buyer ( since he has to audit the seller’s invoices )
Advantages:
Disadvantages:
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Time & Material Contracts
Hybrid type of contractual agreement.
Contain aspects of both cost-reimbursable and fixed-price types.
They are open ended, but on certain rates.
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Time & Material Contracts
Quick to create
Duration brief
Used when expat acquisition & staff augmentation
Only good in small projects
Needs daily oversight & reports from the buyer ( more work)
Advantages:
Disadvantages:
Ahmad Maharma PMBOK 5th Edition 530
Type of contract
Ahmad Maharma PMBOK 5th Edition 531
Type of contract
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Type of contract
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Type of contract
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Type of contract
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Type of contract
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Contract Types vs. Risk
Fixed Price
FFP
FPIF
Time and Materials
Cost Reimbursable
CPIF
CPFF
CPF
CPPC
•Effect of contract type on buyer & seller risk
SELLER RISK
High
Low
BUYER
RISK
Low
High
T&M can be a high risk for buyer if contract does not include a “total not-to-exceed” (NTE)
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Which Type is Better?
Depends on:
How well defined the contract statement of work is.
The amount and frequency of change expected.
The level of effort and expertise the buyer can devote to managing the seller.
Industry standards for the types of contract used.
Amount of market competition.
Amount of risk.
Ahmad Maharma PMBOK 5th Edition 538
Procurement Documents
A buyer-prepared formal request sent to each Seller.
The Basis upon which a seller prepares a bid for the requested products.
RFP/ RFQ/RFI/IFB are used to solicit proposals to meet procurement needs.
Statement of Work (SOW): procurement item in sufficient detail to allow prospective sellers to determine if they are capable of providing the item(s).
Statement of Objective (SOO): term used for a procurement item that is presented as a problem to be solved.
Ahmad Maharma PMBOK 5th Edition 539
Procurement Documents (RFP/ RFQ/RFI/IFB )
Once the contract type is selected & the procurement SOW has been created, the buyer can put together the procurement documents that describe their needs
Request for proposal (RFP): sometimes it’s called request for Tender, it requests a detailed proposal on how the work will be accomplished, who will do it, company experience, price, Technical requirements, etc & it allows the company to detect benefits & risks at early stage.. ( usually used with CR contracts)
Invitation for Bid ( IFB, or request for bid RFB): just to request a total price to do all the work. (usually used with FP contracts)
Request for Quotation (RFQ): request a price quote per item, hour, meter, or other unit of measure, used when price is the main factor ( usually used with T&M)
Request for Information (RFI): is simply looking for information , it might be used before procurement documents are created, the received information could help the company to identify the required in order to send RFQ, RFP or IFB Ahmad Maharma PMBOK 5th Edition 540
Collect Requirement
from all stakeholders
Define scope
Of the project
Prepare a detailed
SOW
Prepare RFP
4
3
2
1
Procurement SOW must be as
clear & concise as possible and
it must
describe all the work and
activities the seller is required to
complete
(steps for preparing RFP)
Ahmad Maharma PMBOK 5th Edition 541
How to write (RFP) RFP usually includes:
Company
Background
Project
Definition
Project
Requirements
Audience
which include a short company overview such as a brief
history , industry background, company size, etc..
It is crucial for the vendor and project team to understand the
underlying business case for the project; that is, why the
project is being attempted. Also understand deliverables
expected from the project by the vendor
which include Technical requirements, functional
requirements, etc…
Information about the und users
Ahmad Maharma PMBOK 5th Edition 542
(RFP Form-Example)REQUEST FOR PROPOSALS (RFP)
RFP NO. ______________
PROJECT TITLE: PROPOSAL DUE DATE: __________– Time, Pacific Standard Time or Pacific Daylight Time, Olympia, Washington, USA. E-mailed bids will be accepted. Faxed bids will not. ESTIMATED TIME PERIOD FOR CONTRACT: ________– ___________ The Agency reserves the right to extend the contract for up to two additional one-year periods at the sole discretion of the Agency. CONSULTANT ELIGIBILITY: This procurement is open to those consultants that satisfy the minimum qualifications stated herein and that are available for work in Washington State. CONTENTS OF THE REQUEST FOR PROPOSALS:
1. Introduction
2. General Information for Consultants
3. Proposal Contents
4. Evaluation and Award
5. Exhibits
A. Certifications and Assurances
B. Personal Service Contract with General Terms and Conditions 1.1. PURPOSE AND BACKGROUND
(NOTE: Provide a clear statement of the project’s purpose, present system or process, and perceived need, as well as any other background about the project, which may be appropriate.) The Washington State, <insert agency name>, hereafter called "AGENCY,” is initiating this Request for Proposals (RFP) to solicit proposals from firms interested in participating on a project to _________________. 1.2. OBJECTIVES AND SCOPE OF WORK
(NOTE: Explain what the contract is intended to accomplish.). 1.3 MINIMUM QUALIFICATIONS (NOTE: Include what is required to be able to qualify for a contract.)
Ahmad Maharma PMBOK 5th Edition 543
Source Selection Criteria Can be only price if an off-the-shelf product. Other selection criteria take into consideration: Understanding of needs. Overall life-cycle cost Technical capability Risk Management approach Technical approach Warranty Financial capability Production capacity Past performance References IP rights
They are included in the procurement documents to give the seller an understanding of the buyer’s needs
They help the seller on how to prepare the bid
They become the basis by which the buyer evaluates the bids
Ahmad Maharma PMBOK 5th Edition 544
PMBOK Reading
Chapter 12- Section 12.1
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Project Management Professional
PMP®
Phase #2: PROJECT PLANNING
Chapter 11: Stakeholder / 13.1 Plan Stakeholders
Management
Project Stakeholder Management
Identify Stakeholders
Plan Stakeholder Management
Manage Stakeholder Engagement
ControlStakeholderEngagement
Ahmad Maharma PMBOK 5th Edition 547
Plan Stakeholder Management
Identify Stakeholders
Plan Stakeholder Management
Manage Stakeholder Engagement
ControlStakeholderEngagement
Ahmad Maharma PMBOK 5th Edition 548
Plan Stakeholder Management
The process of developing appropriate management strategies to effectively engage stakeholders through the project life cycle, based on the analysis of their needs, interests, and potential impact on project success.
It provides a clear, actionable plan to interact with project stakeholders to support the project’s interests.
Ahmad Maharma PMBOK 5th Edition 549
Plan Risk Responses
Project ManagementPlan
Stakeholder Register
Enterprise Environmental Factors
Organizational Process Assets
Expert Judgment
Meetings
Analytical Techniques
Stakeholder Management Plan
Project Documents Updates
Ahmad Maharma PMBOK 5th Edition 550
Analytical Techniques
The engagement level of 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 impacts and supportive for change
Leading Aware of project impacts and actively engaged in ensuring the project is a success
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Stakeholder Engagement Assessment Matrix
Stakeholder Unaware Resistant Neutral Supportive Leading
Stakeholder 1 C D
Stakeholder 2 C D
Stakeholder 3 DC
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Stakeholder Management Plan
A component of project management plan
Identifies the management strategies required to effectively engage stakeholders
Ahmad Maharma PMBOK 5th Edition 553
Stakeholder Management Plan
It can also provide• Desired and current engagement levels of stakeholders• Scope and impact of change to stakeholders• Identified interrelationships and potential overlap between
stakeholders• Stakeholder communication requirements for the current project
phase• Information to be distributed to stakeholders, including language,
format, content and level of detail• Reason for the distribution of that information and expected
impact to stakeholder engagement• Time frame and frequency for the distribution of required
information to stakeholders; and• Method for refining and updating the stakeholder management
plan as the project progresses and develops
Ahmad Maharma PMBOK 5th Edition 554
PMBOK Reading
Chapter 13
- Section 13.1
Ahmad Maharma PMBOK 5th Edition 555
Project Management Professional
PMP®
Phase #3: PROJECT EXECUTION
The Execution Processes
Direct & Manage Project Execution
Perform Quality Assurance
Acquire Project Team
Develop Project Team
Manage Project Team
Manage Communications
Conduct Procurement
Manage Stakeholder Engagement
Ahmad Maharma PMBOK 5th Edition 557
Project Management Professional
PMP®
Phase #3: PROJECT EXECUTION
Chapter 4: Integration / 4.3 Direct and Manage Project work
Direct & Manage Project Execution
The process of performing the work defined in the project management plan to achieve project objectives.
Ahmad Maharma PMBOK 5th Edition 559
Direct & manage Project Execution
Performing activities to accomplish project requirements.
Creating project deliverables.
Staffing, training and managing the team members assigned to the project.
Obtaining, managing, and using resources including material, tools, equipment, and facilities.
Implementing the planned methods and standard .
Establishing and managing project communication channels, both external and internal to the project team.
Ahmad Maharma PMBOK 5th Edition 560
Direct & manage Project Execution
Generating project data, such as cost, schedule, technical and quality progress, and status to facilitate forecasting.
Issuing change requests and adapting approved changes into the project’s scope, plans and environment.
Managing risks and implementing risk response activities.
Managing sellers and suppliers; and
Collecting & documenting lessons learned, and implementing approved process improvement activities.
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Direct & manage Project Execution
Project Management Plan
Approved Change Requests
Enterprise environmental Factors
Organizational Process Assets
Expert Judgment
Project Management Information System
Meetings
Deliverables
Work Performance Data
Change Requests
Project Management Plan Updates
Project Document Updates
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Deliverables
Any unique and verifiable product, result, or capability to perform a service that is identified in the project management planning documentation, and must be produced and provided to complete the project.
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Project Management Professional
PMP®
Phase #3: PROJECT EXECUTION
Chapter 8: Quality/ 8.2 Perform Quality Assurance
Perform Quality Assurance
The process of auditing the quality requirements and the results from quality control measurements to ensure appropriate quality standards and operational definitions are used.
Ahmad Maharma PMBOK 5th Edition 565
Perform Quality Assurance
PlanQuality
Management
Perform Quality
Assurance
ControlQuality
Ahmad Maharma PMBOK 5th Edition 566
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
Organizational Process Assets Updates
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Quality Audits
A structured, independent review to determine whether project activities comply with organizational and project policies, processes, and procedures.
Can be scheduled or random.
Can be conducted by external or internal auditors.
Result in:
Reduced cost of quality.
Increase in sponsor or customer acceptance.
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Objectives of Quality Audits
Identify all the good/ best practices being implemented.
Identify all the gaps/ shortcomings.
Share the good practices introduced or implemented in similar projects in the organization and/ or industry.
Proactively offer assistance in a positive manner to improve implementation of processes to help the team raise productivity.
Highlight contributions of each audit in the lessons learned repository of the organization.
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Process Analysis
Follows steps outlined in the process improvement plan to identify needed improvements.
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Organizational Process Assets Updates
Quality Standards.
Processes.
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Project Management Plan Updates
Quality management plan.
Schedule management plan.
Cost management plan.
Ahmad Maharma PMBOK 5th Edition 572
Project Document Updates
Quality audits reports.
Training plans.
Process documentation.
Ahmad Maharma PMBOK 5th Edition 573
Gold Plating
Giving Extra
Bad and should be avoided
Ahmad Maharma PMBOK 5th Edition 574
Project Management Professional
PMP®
Phase #3: PROJECT EXECUTION
Chapter 9: HR / 9.2 Acquire Project Team
Acquire Project Team
The process of confirming human resources availability and obtaining the team necessary to complete project assignments.
Ahmad Maharma PMBOK 5th Edition 576
Acquire Project Team
The project management team may or may not have direct control over team members selection because of:
Collective bargaining agreements.
Use of subcontractor personnel.
Matrix project environment.
Internal or external reporting relationships.
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Acquire Project TeamPlan
HumanResource
Management
AcquireProjectTeam
DevelopProjectTeam
ManageProjectTeam
Ahmad Maharma PMBOK 5th Edition 578
Acquire Project Team
Human Resource Management Plan
Enterprise Environmental Factors
Organizational Process Assets
Pre-assignment
Negotiation
Acquisition
Virtual Teams
Multi-Criteria Decision Analysis
Project Staff Assignments
Resource Calendars
Project Management Plan Updates
Ahmad Maharma PMBOK 5th Edition 579
Pre-assignment
When project team members are known in advance.
If the project is a result of:
Specific people being promised as part of a proposal.
The project is dependent on the expertise of particular persons.
Some staff assignments are defined within the project charter.
Ahmad Maharma PMBOK 5th Edition 580
Negotiation
Negotiating with:
Functional managers.
Other project management teams within the organization.
External organizations, vendors, suppliers, contractors…etc.
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Acquisition
When the needed resources are not available in-house.
Can involve hiring individual consultants or subcontracting work to another organization.
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Virtual Teams
Groups of people with a shared goal who fulfill their roles with little or no time spent meeting face-to-face.
The ease of communication through electronic means made virtual teams more feasible.
Communication planning becomes increasingly important in virtual team environment.
Ahmad Maharma PMBOK 5th Edition 583
Virtual Teams
Virtual teams make it possible to:
Form teams of people from the same organization who live in widespread geographic areas.
Add expertise that can’t exist at the same location.
Incorporate employees who work from home.
Allow team members who work different shifts or hours to participate.
Include people with mobility limitations or disabilities.
Reduce travel expenses.
Ahmad Maharma PMBOK 5th Edition 584
Multi-Criteria Decision Analysis
Criteria is developed and used to rate or score potential team members
Examples Include
– Availability
– Cost
– Experience
– Ability
– Knowledge
– Skills
– Attitude
– International Factors
Ahmad Maharma PMBOK 5th Edition 585
Project Management Professional
PMP®
Phase #3: PROJECT EXECUTION
Chapter 9: HR / 9.3 Develop Project Team
Develop Project Team
The process of improving competencies, team interaction, and the overall team environment to enhance project performance.
Project managers should create an environment that facilitates teamwork.
Ahmad Maharma PMBOK 5th Edition 587
Develop Project Team
Developing project teams include:
Improving skills of team members
Improving feelings of trust & cohesiveness
Creating a dynamic and cohesive team culture to improve both individual and team productivity, team spirit and cooperation
Examples include assisting one another, and communicate in ways that fit individual preference.
Ahmad Maharma PMBOK 5th Edition 588
Develop Project TeamPlan
HumanResource
Management
AcquireProjectTeam
DevelopProjectTeam
ManageProjectTeam
Ahmad Maharma PMBOK 5th Edition 589
Develop Project Team
Interpersonal Skills
Training
Team Building Activities
Ground Rules
Co-location
Reward & Recognition
Personnel Assessment Tools
Team Performance Assessments.
Enterprise Environmental Factors Update.
Project Staff Assignments
Human Resource Management Plan
Resource Calendars
Ahmad Maharma PMBOK 5th Edition 590
Interpersonal Skills
Sometime known as “Soft Skills”
Include:
Empathy.
Influence.
Creativity.
Group facilitation.
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Training
Can be:
Formal
Informal
Training methods:
Classroom.
Online.
Computer-based.
On the job
Coaching
Mentoring.
Ahmad Maharma PMBOK 5th Edition 592
Team Building Activities
Can vary from a five-minute agenda item to an off-site, professionally facilitated experience to improve interpersonal relationships.
The objective is to help individual team members to work together effectively.
Particularly valuable when team members work from different locations.
Informal communication and activities can help in building trust and establishing good working relationships.
Ahmad Maharma PMBOK 5th Edition 593
Team development Stages
Forming.
Storming.
Norming.
Performing.
Adjourning.
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Forming
The team meets and learns about the project and what their formal roles and responsibilities are.
Team members tend to be independent and open in this phase.
Team members are usually on their best behavior but very focused on themselves.
In this stage the members of the team get to know one another, exchange some personal information, and make new friends.
Ahmad Maharma PMBOK 5th Edition 595
Storming
Team begins to address the project work, technical decisions, and the project management approach.
If team members are not collaborative and open to differing ideas and perspectives the environment can become destructive.
In some cases, the team never leaves this stage.
The role of project manager is crucial in this stage. Tolerance and patience will help in passing through it successfully.
Ahmad Maharma PMBOK 5th Edition 596
Norming
Team members begin to work together and adjust work habits and behaviors to support the team.
Team begins to trust each other.
Motivation increases as the team gets more acquainted with the project.
As team members get to know each other better, their views of each other begin to change
Ahmad Maharma PMBOK 5th Edition 597
Performing
Teams should try to reach this stage as quickly as possible.
Teams that reach this stage function as a well-organized unit.
Teams at this stage are able to function as a unit as they find ways to get the job done smoothly and effectively without inappropriate conflict or the need for external supervision.
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Adjourning
The team completes the work and move on from the project.
Mourning over the dissolving of the team relationship, and begin preparing for change in individual work requirements.
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Ground Rules
Establishing clear expectations regarding acceptable and unacceptable behavior.
Examples include:
How team members should resolve conflicts.
Is interruption in meetings allowed or not.
Coming late to meetings.
Phone calls.
Smoking.
Who’s allowed to talk to senior management.
Who’s authorized to give directions to vendors/ subcontractors.
Work times.
Codes of dress.Ahmad Maharma PMBOK 5th Edition 600
Co-location
Involves placing many of the team members in one physical location.
Can be temporary in some cases.
Can be used in conjunction with virtual teams.
Enhances ability to perform as a team.
War rooms.
Ahmad Maharma PMBOK 5th Edition 601
Recognition and Rewards
For desirable behaviors only.
Through performance appraisal.
Should satisfy needs valued by individuals.
Should focus on win-win instead of win-lose.
Generally, money is viewed as a very tangible aspect of a reward system.
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Team performance Assessments
Formal or informal
Conducted by the project management team
The performance of successful team is measured according to agreed upon project objectives
Evaluation indicators include:
Improvements in skills
Improvements in competencies
Reduced staff turn over rate
Increased team cohesiveness
Should trigger actions such as training, changes, recommendations, etc..
Ahmad Maharma PMBOK 5th Edition 603
Project Management Professional
PMP®
Phase #3: PROJECT EXECUTION
Chapter 9: HR / 9.4 Manage Project Team
Manage Project Team
The process of tracking team performance, providing feedback, resolving issues, and managing changes to optimize project performance.
The project management team:
Observes team performance.
Manages conflict.
Resolves issues.
Appraises team performance.
Ahmad Maharma PMBOK 5th Edition 605
Manage Project TeamPlan
HumanResource
Management
AcquireProjectTeam
DevelopProjectTeam
ManageProjectTeam
Ahmad Maharma PMBOK 5th Edition 606
Manage Project Team
Observation and Conversation
Project Performance Appraisals
Conflict Management
Interpersonal Skills
Enterprise Environmental Factors Updates
Organizational Process Assets Updates
Change Requests
Project Management Plan Updates
Project Documents Updates
Project Staff AssignmentsHuman
Resource Management PlanTeam
Performance Assessments Issue LogWork
Performance ReportsOrganizational
Process Assets
Ahmad Maharma PMBOK 5th Edition 607
Observation & Conversation
Used to stay in touch with the work and attitudes of project team members.
Project management team monitors progress towards:
Project deliverables.
Accomplishments.
Interpersonal issues.
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Project Performance Appraisals
Can be formal or informal depending on the length of the project, organizational policy, project complexity and the amount and quality of regular communication.
Objectives include:
Clarification of roles and responsibilities.
Constructive feedback to team members.
Discovery of unknown or unresolved issues.
Development of individual training plans.
Establishment of specific goals for future time periods.
Ahmad Maharma PMBOK 5th Edition 609
Conflict Management
Should conflict be avoided?
Ahmad Maharma PMBOK 5th Edition 610
Conflict Management
Conflict in projects is inevitable…
Why?
Ahmad Maharma PMBOK 5th Edition 611
Conflict Management.• Conflicts can be beneficial (an opportunities for improvement)
• Conflicts is an inevitable consequence of organizational
interactions.
• Conflicts in the team are caused due to the following reasons in
decreasing order of occurrences.1. Schedules
2. Project priorities
3. Resources
4. Technical opinions
• The most common cause of conflicts in projects are issues related
to schedules (not personality differences).
• Conflict is best resolved by those involved in the conflict.
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Sources of Conflict in projects
Scarcity of resources.
Scheduling priorities.
Personalities.
Limited power of project manager.
Ahmad Maharma PMBOK 5th Edition 613
Facts about Conflict
Natural and forces search for alternatives.
Is a team issue.
Openness resolves conflict.
Should focus on issues, not personalities.
Should focus on the present, not the past.
Ahmad Maharma PMBOK 5th Edition 614
How Can Conflict Be Minimized?
Communication.
Planning
Ground rules.
Identification of root causes and resolving them.
Involving team members in resolution.
Ahmad Maharma PMBOK 5th Edition 615
Conflict Resolution Techniques
Withdrawing/Avoiding.
Smoothing/ Accommodating.
Compromising.
Forcing.
Collaborating.
Confronting/ problem solving.
Ahmad Maharma PMBOK 5th Edition 616
Conflict Management• General techniques to resolve conflict
Confronting & Problem Solving
Treating conflict as problem to be solved by examining alternatives;
Requires a give and take attitude and open dialogue.
Forcing
Pushing one’s viewpoint at the expense of others; Offers only win-
lose solutions.
Collaborating
Incorporating multiple viewpoints and insights from differing
perspectives; Leads to consensus and commitment.
Withdrawing/Avoiding
Retreating from an actual or potential conflict situation.
Smoothing/Accommodating
Emphasizing areas of agreement rather than areas of difference.
Compromising
Searching for solution that bring some degree of satisfaction to all
parties.
Behaviors that
focused on others
Beh
avio
rs t
ha
t
foc
us
ed
on
se
lf
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Withdrawing/ Avoiding
Retreating from an actual or potential conflict situation.
A passive, stop-gap way of handling conflict.
Appropriate when a “cooling-off’ period is needed, and when the other party is unassertive and uncooperative.
A lose-lose technique
Generally fails to solve the problem.
Should not be used when the conflict deals with an issue that is of immediate concern or is important to the successful completion of the project.
Ahmad Maharma PMBOK 5th Edition 618
Smoothing/ Accommodating
Emphasizing areas of agreement rather than areas of difference.
An appeasing approach.
Appropriate to keep harmony and avoid outwardly conflictive situations.
Fails to provide permanent long-term solution to the underlying conflict.
Generally, conflict reappears in a different form.
A lose-lose technique
Ahmad Maharma PMBOK 5th Edition 619
Compromising
Searching for a solution that bring some degree of satisfaction to all parties.
Is primarily “bargaining”, receiving something in exchange for something else.
Appropriate when reached and accepted as a just solution by both parties involved in conflict.
Usually provides acceptable solutions.
Sometimes, important aspects of the project can’t be compromised to achieve personal objectives.
Ahmad Maharma PMBOK 5th Edition 620
forcing
Pushing one’s view at the expense of others.
A win-lose situation.
Used when there is no common ground for bargaining or negotiation.
Also used when both parties are uncooperative and strong-willed.
Appropriate when time is of essence, and issue is vital for the well-being of project.
Usually takes less time than other techniques, but leaves hard feelings.
Conflict resolved by forcing may develop again and haunt the enforcer.
Should be used only as a last resort.Ahmad Maharma PMBOK 5th Edition 621
Collaborating
Incorporating multiple view points and insights from differing perspectives.
Leads to consensus and commitment.
Used when the situation is too important to be compromised.
Not very effective when more than a few players are involved and their viewpoints are mutually exclusive.
Ahmad Maharma PMBOK 5th Edition 622
Confronting/ Problem Solving
Treating conflict as a problem to be solved by examining alternatives.
Requires a give-and-take attitude and open dialogue.
Involves pinpointing the issue and resolving it objectively by defining the problem, gathering necessary information, generating and analyzing alternatives, and selecting the best alternative.
Requires open dialogue between participants, who must be mature, understanding, and competent-both technically and managerially.
Takes longer than other techniques.
Provides ultimate solutions.
Ahmad Maharma PMBOK 5th Edition 623
Techniques Description Solution
Forcing forcing a solution – from one side,
not the best solution.
Permanent Win-lose
Smoothing /
Accommodatin
g
attempting to underestimate the
conflict.
Temporary Lose-lose
Compromising brings some degree of satisfaction
to both parties.
Permanent:
commitmen
t
Lose-lose
Confrontation
/ Problem
Solving
Treating conflict as a problem;
solving the real problem, most
often used by project managers.
Permanent Win-win
Collaborating Incorporating multiple viewpoints
and insights from differing
perspectives; leads to consensus
and commitment.
Permanent Win-win
Withdrawal /
Avoidance
retreating or postponing a
decision never results in
resolution.
Temporary Lose-lose
SUMMARY
Ahmad Maharma PMBOK 5th Edition 624
To Resolve a Conflict
Assure Privacy
Empathize than sympathize
Listen actively
Maintain equity
Focus on issue, not on personality
Avoid blame
Identify key theme
Re-state key theme frequently
Encourage feedback
Identify alternate solutions
Give your positive feedback
Agree on an action plan
Ahmad Maharma PMBOK 5th Edition 625
Exercise: Conflict ManagementDescription Type of Resolving
“It seems that the real problem here is not a lack of communication, but a lack of
knowledge of what needs to be done and when. Here is a copy of the project schedule.
It should help you understand what you need to know.”
Confronting
"Do it my way!" Forcing
"Let's calm down and get the job done!" Smoothing
“Let us do a little of what both of you suggest” Compromising
“Let's deal with this issue next week" Withdrawal
“Sandy and Amanda, both of you want this project to cause as little distraction to your
departments as possible. With that in mind, I am sure we can come to an agreement
on the purchase of equipment and what is best for the project."
Smoothing
“We have talked about new computers enough. I do not want to get the computers,
and that is it!"
Forcing
"Sandy, you say that the project should include the purchase of new computers, and
Amanda, you say that the project can use existing equipment. I suggest we perform the
following test on the existing equipment to determine if it needs to be replaced."
Confronting
“Let's what everyone thinks, and try to reach a consensus” Collaborating
Ahmad Maharma PMBOK 5th Edition 626
Problem Solving
• The important thing to realize about problems is if they are not
solved completely, they just return again and again.
• The process of problem solving has these steps
1. Define the cause of the problem
2. Analyze the problem
3. Identify solution
4. Implement a decision
5. Review the decision, and confirm that the problem
is solved.
Ahmad Maharma PMBOK 5th Edition 627
Project Manager PowerA Project Manager may yield authority over the project team in one of the following
ways
– Formal (Legitimate) - Power due to Project Managers position
– Reward – Power stems from giving rewards.
– Penalty (Coercive) – Power due to afraid of the power the Project Manager holds.
– Expert (Technical) – Comes from being technical or project management expert.
– Referent – Power of charisma and fame. Make another person liking/respecting the
Project Manager.
The best forms of power: EXPERT and REWARD.
Earned on your own: EXPERT
The worst choice: PENALTY
Derived from position in the company: FORMAL, REWARD and PENALTY.
Ahmad Maharma PMBOK 5th Edition 628
Management & Leadership Style
• Autocratic– Top down approach. The manager has power to do whatever she/he wants.
– Sometime appropriate when decisions must be made for emergency situation or time
pressure.
• Democratic/Participative– Encouraging team participation in the decision making process
– Best used for people whose behavior fit with theory Y
• Laissez-faire - a French term means “leave alone”
– The manager is not directly involve in the work of the team.
– Effective for highly skilled team
Ahmad Maharma PMBOK 5th Edition 629
Important Terms• Halo Effect
The assumption that because the person is good at technical, he will be good as a project
manager.
• ArbitrationA method to resolve conflict. A neutral party hears and resolve a dispute.
• Expectancy Theory - Victor H. Vroom
This is a motivation factor. People put in more efforts because they accept to be rewarded
for their efforts.
• Perquisites (Perks)Some employees receives special rewards e.g. parking spaces, corner offices, executive
dining.
• Fringe BenefitsStandard benefits formally given to all employees, such as insurance, education benefits
and profit benefits.
Ahmad Maharma PMBOK 5th Edition 630
Project Manager Interpersonal Skills
• Leadership
• Team building
• Motivation
• Communicating
• Influencing
• Decision Making
• Political and cultural awareness
• Negotiation
Ahmad Maharma PMBOK 5th Edition 631
Project Management Professional
PMP®
Phase #3: PROJECT EXECUTION
Chapter 10: Communications / 10.2 Manage Communications
Manage Communications
The process of making relevant information available to project stakeholders as planned.
Implementing the “Communications Management Plan”
Responding to unexpected requests for Information
Ahmad Maharma PMBOK 5th Edition 633
Manage Communications
Effective information distribution includes:
Sender-receiver modules.
Choice of media.
Writing style.
Meeting management techniques.
Presentation techniques.
Facilitation techniques.
Ahmad Maharma PMBOK 5th Edition 634
Manage Communications
Plan Communications
Management
Manage Communications
ControlCommunications
Ahmad Maharma PMBOK 5th Edition 635
Manage Communications
Communication TechnologyCommunication
ModelsCommunication
Methods Information
Management SystemPerformance
Reporting
Project Communications
Project Management Plan Updates
Project Documents Updates
Organizational Process Assets Updates
Communications Management Plan
Work Performance Reports
Enterprise Environmental Factors
Organizational Process Assets
Ahmad Maharma PMBOK 5th Edition 636
Communication Methods
Individual and group meetings.
Video and audio conferences.
Computer chats.
Other remote communications methods.
Ahmad Maharma PMBOK 5th Edition 637
Organizational Process Assets (update)
Stakeholder notifications.
Project reports.
Project presentations.
Project records.
Feedback from stakeholders.
Lessons learned documentation.
Ahmad Maharma PMBOK 5th Edition 638
Project Management Professional
PMP®
Phase #3: PROJECT EXECUTION
Chapter 12: Procurement / 12.2 Conduct Procurement
Plan Procurements Management
PlanProcurements Management
Conductprocurements
ControlProcurements
CloseProcurements
Ahmad Maharma PMBOK 5th Edition 640
Conduct Procurements
Bidder Conferences
Proposal Evaluation Techniques
Independent Estimates
Expert Judgment
Advertising
Analytical Techniques
Procurement Negotiations
Selected Sellers
Agreements
Resource Calendars
Change Requests
Project Management Plan Updates
Project Documents Updates
Project Management Plan
Procurement Documents
Source Selection Criteria
Seller Proposals
Project Documents
Make or Buy Decisions
Procurement Statement of Work
Organizational Process Assets
Ahmad Maharma PMBOK 5th Edition 641
Proposal
Seller-prepared Documents.
Describe the seller’s ability & willingness to provide the requested products.
Constitutes a formal and technical offer in response to a buyer’s request.
Ahmad Maharma PMBOK 5th Edition 642
Bidder Conference
Also called: Contractor Conferences, Vendor Conferences, and Pre-Bid Conferences.
Meeting Prospective Sellers before bids preparation, to ensure clear and common understanding of procurement.
All potential sellers are given equal standing during the conference.
Ahmad Maharma PMBOK 5th Edition 643
Advertising
Placing advertisements in general and specialty publications.
Ahmad Maharma PMBOK 5th Edition 644
Proposal Evaluation Techniques
Can involve subjective and objective components.
Multiple reviewers.
Ahmad Maharma PMBOK 5th Edition 645
Develop Qualified Sellers List
List of sellers asked to submit a proposal.
Developed from the organizational assets.
Or project management team can develop from own sources.
Ahmad Maharma PMBOK 5th Edition 646
Select Sellers
Lowest price is not necessarily lowest cost.
Price might be the only factor in off the shelf items.
Proposals are split into commercial and technical sections.
Multiple sources may be required.
Ahmad Maharma PMBOK 5th Edition 647
Select Seller
Weighed System: method for quantifying qualitative data to minimize the personal prejudice on source selection
Independent Estimates: An estimate of what the seller should price the service/ product
Screening System: establishing minimum requirements of performance for one of more of the evaluation criteria
Contract Negotiation: Clarification & mutual agreement on contract aspects
Ahmad Maharma PMBOK 5th Edition 648
Independent Estimates
The procuring organization may either prepare its own independent estimates, or have an estimate of cost prepared by an external professional estimator.
“Should-be” price.
Significant difference between seller price and estimates might happen as a result of:
Statement of work is unclear.
Prospective seller didn’t understand or fully respond.
Change in market condition.
Ahmad Maharma PMBOK 5th Edition 649
Select Seller Weighed System: Method for quantifying qualitative data to
minimize the personal prejudice on source selection
Criteria Weight Rate(1-100 scale)
Score
Number of years in business
5% 50 2.5
Understanding of needs 25% 80 20
Technical Ability 15% 30 4.5
Total 27
Example
Ahmad Maharma PMBOK 5th Edition 650
Conduct Procurements
The process of obtaining seller responses, selecting a seller, and awarding a contract.
Ahmad Maharma PMBOK 5th Edition 651
Select Seller
Independent Estimates: An estimate of what the seller should price the service/ product
The procuring organization may either prepare its own independent estimates, or have an estimate of cost prepared by an external professional estimator
Should-be” price.
Significant difference between seller price and estimates might happen as a result of:
Statement of work is unclear.
Prospective seller didn’t understand or fully respond.
Change in market condition.
Ahmad Maharma PMBOK 5th Edition 652
Select Seller
Screening System: Establishing minimum requirements of performance for one of more of the evaluation criteria
Eliminates sellers who don’t meet the minimum requirements of the source selection criteria
Ahmad Maharma PMBOK 5th Edition 653
Select Seller
Contract Negotiation: Clarification & mutual agreement on contract aspects, main items to negotiate on are:
Scope
Schedule
Price & terms of payment
After Sales/After service
Objectives of Negotiations
Obtain a fair &
reasonable price
Develop a good
relationships with
the seller
Ahmad Maharma PMBOK 5th Edition 654
Select Seller
Attacks “ if your organization can’t manage the
details of the operations perhaps it should get out of the business”
Personal Insults “ if you don’t understand what you are doing
perhaps you should find another job”
Good guy/bad
guy “ One person is helpful to the other side
while the other is difficult to deal with ”
Deadline “ We have a flight at 5pm and we must finish negotiations before that time”
Negotiations Tactics
Ahmad Maharma PMBOK 5th Edition 655
Select Seller
Limited Authority I can’t shorten the schedule I’m not
authorized, limited authority statements are not necessary true”
Missing man “ Only my boss can agree on that &my boss is not here, lets only agree on this”
Withdrawal “ To show that there’s a less interest”
Fair &
Reasonable “ Lets be reasonable just accept that offer as
it stands”
Fait accompli “ This is a done deal”
Negotiations Tactics
Ahmad Maharma PMBOK 5th Edition 656
Seller Rating Systems
Uses information on:
Seller’s Past Performance
Quality Ratings
Delivery Performance
Contractual Compliance
Ahmad Maharma PMBOK 5th Edition 657
Selected sellers
Those sellers who have been judged to be in a competitive range based upon the outcome of the proposal or bid evaluation, and who have negotiated a draft contract that will become the actual contract when the award is made.
Ahmad Maharma PMBOK 5th Edition 658
Agreements
Includes terms and conditions, and may incorporate other items that the buyer specifies regarding what the seller is to perform or provide.
Mutually binding legal agreement:
Obligates the seller to provide.
Obligates the buyer to pay.
Legal relationship subject to remedy in courts.
Ahmad Maharma PMBOK 5th Edition 659
Agreements
Components can include:
Statement of work or deliverables
Schedule baseline
Performance reporting
Period of performance
Roles and responsibilities
Pricing
Payment terms
Place of delivery
Others …
Ahmad Maharma PMBOK 5th Edition 660
Terms to conditions (A)
• ACCEPTANCEThe act of accepting by an authorized representative; an indication of a willingness to pay; the assumption of a legal obligation by a party to the terms and conditions of a contract.
• ACQUISITIONThe act of acquiring goods and services (including construction) for the use of a governmental activity through purchase, rent, or lease. Includes the establishment of needs, description of requirements, selection of procurement method, selection of sources, solicitation of procurement, solicitation for offers, award of contract, financing, contraction administration, and related functions.
• ADDENDUMAn addition or supplement to a document; e.g., items or information added to a procurement document.
• ADVERTISETo make a public announcement of the intention to purchase goods, services or construction with the intention of increasing the response and enlarging the competition. The announcement must conform to the legal requirements imposed by established laws, rules, policies and procedures to inform the public.
• AGREEMENTA duly executed and legally binding contract; the act of agreeing.
• ALPAuthority for Local Purchase: granted by the commissioner of Administration to an individual who has successfully completed all requirements established by the Materials Management Division.
• ALTERNATE RESPONSEA substitute response; an intentional substantive variation to a basic provision or clause of a solicitation by a vendor.
• AMENDMENT/CHANGE ORDERA written modification to a contract or purchase order or other agreements.
• APPROPRIATIONSum of money from public funds set aside for a specific purpose.
• AROAfter Receipt of Order.
Ahmad Maharma PMBOK 5th Edition 661
Terms to conditions (B)
• BEST VALUEA result intended in the acquisition of all goods and services. Price must be one of the evaluation criteria when acquiring goods and services. Other evaluation criteria may include, but are not limited to environmental considerations, quality, and vendor performance.
• BILL OF LADINGA written receipt or contract, given by a carrier, showing a list of goods delivered to it for transportation. The straight bill of lading is a contract which provides for direct shipment to a consignee. The order bill of lading is negotiable; it enables a shipper to collect for a shipment before it reaches its destination (this is done by sending the original bill of lading with a draft drawn on the consignee through a bank). When the consignee receives the lading indicating that payment has been made, the lading will be surrendered to the carrier's agent, and the carrier will then ship the goods to the consignee, and the bill of lading will be surrendered to the carrier. Note: Shippers frequently consign shipments to themselves on order bills of lading so that delivery is made only upon the shipper's order; the person or firm to be notified upon arrival of the shipment at destination must be designated.
• BLANKET ORDERA contract under which a vendor agrees to provide goods or services on a purchase-on-demand basis. The contract generally establishes prices, terms, conditions and the period covered (no quantities are specified); shipments are to be made as required by the purchaser.
• "BRAND NAME OR EQUAL" SPECIFICATIONA specification that uses one or more manufacturers brand names or catalog numbers to describe the standards of quality, performance and other characteristics needed to meet the requirements of a solicitation and provide for the submission of equivalent products.
• BROKERA business that carries no inventory and that has no written ongoing agreement with any manufacturer or manufacturer's authorized distributor to sell the products of the manufacturer.
• BUSINESSA contractor, subcontractor, supplier, consultant, or provider of technical, administrative, or physical services organized as a sole proprietorship, partnership, association, corporation, or other entity formed for the purpose of doing business for profit. Ahmad Maharma PMBOK 5th Edition 662
Terms to conditions (C)
• COMMODITYA transportable article of trade or commerce that can be bartered or sold.
• COMMODITY/SERVICE CONTRACTPreviously referred to as "M-contracts." Since the inception of MAPS, the contract number is a six-digit number assigned by the computer system. An "M" number is no longer assigned for these types of contracts.
• COMPREHENSIVE PROCUREMENT GUIDELINES (CPG)Designates items that must contain recycled content when purchased by federal, state, and local agencies, or by contractors using appropriated federal funds, when these agencies spend more than $10,000 a year on any of the designated items. For example, if a state agency spends more than $10,000 a year on copy paper, and part of that money is from appropriated federal funds, then that state agency must follow the EPS guidelines and buy 30 percent post-consumer recycled paper. (Section 6002 of the Resource Conservation and Recovery Act [RCRA] and Presidential Executive Order 13101.)
• CONSIDERATIONSomething of value given or done as recompense that is exchanged by two parties; that which binds a contract.
• CONTRACTAny written instrument or electronic document containing the elements of offer, acceptance, and consideration to which an agency is a party.
• CONTRACT ADMINISTRATIONThe management of all actions after the award of a contract that must be taken to assure compliance with the contract; e.g., timely delivery, acceptance, payment, closing contract, etc.
• CONTRACTORA person who agrees to furnish goods or services for a certain price; may be a prime contractor or subcontractor.
• COOPERATIVE PURCHASINGThe combining of requirements of two or more governmental units to obtain the benefits of volume purchases and/or reduction in administrative expenses.
• COOPERATIVE PURCHASING VENTURE (CPV)A joint purchasing program designed by the State of Minnesota where governmental units obtain the benefits of volume purchasing and/or reduction in administrative expenses by participating in the program and purchasing from existing State of Minnesota commodity contracts.
Ahmad Maharma PMBOK 5th Edition 663
Terms to conditions (D)
• DEALER, JOBBER OR DISTRIBUTORA business that maintains a store, warehouse, or other establishment in which a line or lines of products are kept in inventory and are sold to the public on a wholesale or retail basis.
• DEBARMENTThe disqualification of a person to receive invitations for bids or requests for proposals, or the award of a contract by a government body, for a specified time commensurate with the seriousness of the offense, the failure, or the inadequacy of performance.
• DEFAULTFailure by a party to a contract to comply with contractual requirements.
• DELIVERYThe formal handing over of property; the transfer of possession, such as by carrier to purchaser.
• DEMURRAGEThe detention of a ship, railroad, car or truck beyond a specified time for loading/unloading; the payment required and made for the delay.
• DESIGN SPECIFICATIONA specification setting forth the required characteristics to be considered for award of contract, including sufficient detail to show how the product is to be manufactured.
• DESTINATIONThe place to which a shipment is consigned.
• DOCUMENT TYPEMAPS Procurement uses document type to differentiate among different functions for a requisition, solicitation, contract, or order. The document type is a field to be entered on those screens that are for requisition solicitation, contract, or order.
• DROP SHIPMENTMerchandise which is shipped by a manufacturer directly to a customer in response to the seller who collects orders but does not maintain an inventory.
Ahmad Maharma PMBOK 5th Edition 664
Terms to conditions (E)
• ECONOMICALLY DISADVANTAGED AREA BUSINESS (ED)Small business eligible for certification as socially disadvantaged business or economically disadvantaged area business: A small business entity with its principal place of business in Minnesota organized for profit, including an individual, partnership, corporation, joint venture, association, or cooperative that is 51 percent owned and is operationally controlled on a day-to-day basis by citizens of the United States. The areas of economic disadvantage are determined by the US Department of Labor.
• EMERGENCY ACQUISITIONA threat to public health, welfare, or safety that threatens the functioning of government, the protection of property or the health or safety of people.
• ENERGY STARA federal standard applied to office equipment for the purpose of rating the energy efficiency of the equipment. Energy Star computers, monitors, and printers save energy by powering down and going to "sleep" when not in use, resulting in a reduction in electrical bills and pollution levels.
• ENVIRONMENTALLY PREFERABLE PRODUCT (EPP)A product or service that has a lesser or reduced impact on human health and the environment when compared with competing products or services that serve the same purpose. Such products or services may include, but are not limited to those which contain recycled content, minimize waste, conserve energy or water, and reduce the amount of toxics either disposed of or consumed.
• EQUAL OR APPROVED EQUALUsed to indicate that an item may be substituted for a required item if it is equal in quality, performance and other characteristics.
• ESCALATION CLAUSEA contract provision which permits the adjustment of contract prices by an amount or percent if certain specified contingencies occur, such as changes in the vendor's raw material or labor costs.
• EVALUATION OF RESPONSESThe examination of responses after opening to determine the vendor's responsibility, responsiveness to requirements, and other characteristics of the solicitation relating to the award.
Ahmad Maharma PMBOK 5th Edition 665
Terms to conditions (F-J)
• FISCAL YEARThe 12 months between one annual settlement of financial accounts and the next; a term used for budgeting, etc. The fiscal year for the U.S. Government is October 1 to September 30; the fiscal year for the State of Minnesota is July 1 to June 30.
• FIXED ASSETSState property that is in one of four categories:
– all non-expendable property having a normal life expectancy of more than two years and a value of $2,000 or more.
– all semi-expendable property established by the owning agency's policy as fixed assets: any item having a normal life expectancy of more than two years and a value of less than $2,000.
– all firearms, regardless of their value.
– all sensitive items, as established by the agency policy.
• FORMAL SOLICITATIONA solicitation which requires a sealed response.
• GOODSAll types of personal property including commodities, materials, supplies, and equipment.
• HAZARDOUS WASTEAny waste (solid, liquid, or gas) which because of its quantity, concentration, or chemical, physical, or infectious characteristics pose a substantial present or potential hazard to human health or the environment when improperly treated, stored, transported, or disposed of.
• INFORMAL SOLICITATIONA solicitation which does not require a sealed response.
• INSURANCEA contract between an insurance company and a person or group which provides for a money payment in case of covered loss, accident or death.
• INVOICEA list of goods or services sent to a purchaser showing information including prices, quantities and shipping charges for payment.
• JOINT VENTUREThe temporary association of two or more businesses to secure and fulfill a procurement bid award. Ahmad Maharma PMBOK 5th Edition 666
Terms to conditions (L)
• LABOR SURPLUS AREAA civil jurisdiction designated by the U.S. Department of Labor, usually updated annually in the late fall. Used as one of the criteria for designating economically disadvantaged (ED) vendors.
• LEAD TIMEThe time that it would take a supplier to delivery goods after receipt of order.
• LEASEA contract conveying from one entity to another the use of real or personal property for a designated period of time in return for payment or other consideration.
• LESS-THAN-TRUCKLOAD (LTL)A quantity of freight less than the amount necessary to constitute a truckload.
• LESSEEOne to whom a lease is granted.
• LESSOROne who grants a lease.
• LIFE CYCLE COSTINGA procurement evaluation technique which determines the total cost of acquisition, operation, maintaining and disposal of the items acquired; the lowest ownership cost during the time the item is in use.
• LINE ITEMAn item of supply or service specified in a solicitation for which the vendor must specify a separate price.
• LIQUIDATED DAMAGESA specific sum of money, agreed to as part of a contract to be paid by one party to the other in the event of a breach of contract in lieu of actual damages, unless otherwise provided by law.
• LIST PRICEThe price of an article published in a catalog, advertisement or printed list from which discounts, if any, may be subtracted.
• LOWEST RESPONSIBLE VENDORThe vendor with the lowest price whose past performance, reputation and financial capability is deemed acceptable. Ahmad Maharma PMBOK 5th Edition 667
Terms to conditions (M)
• MANDATORYRequired by the order stipulated, e.g., a specification or a specific description that may not be waived.
• MAPSThe Minnesota Accounting and Procurement System. Quite often MAPS or AGPS is referred to when speaking of the Procurement side of the system and GFS is referred to when speaking of the accounting side.
• MANUFACTURERA business that makes or processes raw materials into a finished product.
• MARKETThe aggregate forces (including economics) at work in trade and commerce in a specific service or commodity. To sell, analyze, advertise, package, etc.
• MATERIAL VARIANCE/MATERIAL DEVIATIONA variance or deviation in a response from specifications of conditions that allows a responder a substantial advantage or benefit not enjoyed by all other responders or that gives the state something significantly different from what the state requested in the solicitation document.
• MATERIALS MANAGEMENTEmbraces all functions of acquisition, standards, quality control and surplus property management.
• MODEL PROCUREMENT CODE (MPC)A publication approved by the American Bar Association which sets forth procurement statutory principles and policy guidelines for managing and controlling the procurement of supplies, services and construction for public purposes; administrative and judicial remedies for the resolution of controversies relating to public contracts; and a set of ethical standards governing public and private participants in the procurement process.
• MULTIPLE AWARDContracts awarded to more than one supplier for comparable supplies and services. Awards are made for the same generic types of items at various prices.
Ahmad Maharma PMBOK 5th Edition 668
Terms to conditions (N)
• NAICS (NORTH AMERICAN INDUSTRY CLASSIFICATION SYSTEM) CODE [FORMERLY KNOWN AS SIC (STANDARD INDUSTRIAL CLASSIFICATION) CODE]Classification of business established by type of activity for the purpose of facilitating the collection, tabulation, presentation, and analysis of data collected by various agencies of the United States government, state agencies, trade associations, and private research organizations for promoting uniformity and comparability in the presentation of statistical data relating to those establishments and their fields of endeavor.
• NAPMNational Association of Purchasing Management. A nonprofit educational and technical organization of purchasing and materials management personnel and buying agencies from the public and private sectors.
• NASPONational Association of State Purchasing Officials. An organization of state procurement representatives for the purpose of promoting efficient and effective public purchasing policies and procedures at the state level. NASPO is an affiliate of the Control of State Governments (CSG).
• NEGOTIATIONRequests for proposals are sometimes used as a starting point for negotiations to establish a contract. RFPs generally include more than just price considerations. This method is especially applicable when dealing with a single source manufacturer.
• NET PRICEPrice after all discounts, rebates, etc., have been allowed.
• NIGPNational Institute of Governmental Purchasing. A nonprofit, educational and technical assistance corporation of public purchasing agencies and activities at the federal, state and local levels of government.
• NO BIDA response to a solicitation for bids stating that respondent does not wish to submit an offer. It usually operates as a procedure consideration to prevent suspension from the vendors list for failure to submit a response.
Ahmad Maharma PMBOK 5th Edition 669
Terms to conditions (O-P)
• OPEN MARKET REQUISITION (OMR)The requisition document type used in MAPS Procurement to request the purchase of a non-contract item when the requested item's estimated cost exceeds the authority for purchase level of the buyer. An OMR conveys the request for purchase to the person with the authority to purchase. The resulting order type is most often the Purchase Order Requisition (POR).
• OPTION TO EXTEND/RENEWA provision (or exercise of a provision) which allows a continuance of the contract for an additional time according to permissible contractual conditions.
• OSHAThe Occupational Safety and Healt
• PACKING LISTA document which itemizes in detail the contents of a particular package or shipment.
• PARTIAL PAYMENTThe payment authorized in a contract upon delivery of one or more units called for under the contract or upon completion of one or more distinct items of service called for thereunder.
• PER DIEMBy the day.
• PERFORMANCE BONDA contract of guarantee, executed subsequent to award by a successful vendor to protect the buyer from loss due to the vendor's inability to complete the contract as agreed.
• PERFORMANCE SPECIFICATIONA specification setting forth performance requirements determined necessary for the item involved to perform and last as required.
• PLANT-MATTER BASED OR BIO-BASED PRODUCTA product derived from renewable resources, including fiber crops, such as kenaf; chemical extracts from oilseeds, nuts, fruits and vegetables (such as corn and soybeans); agricultural residues, such as wheat straw and corn stover; and wood wastes generated from processing and manufacturing operations. These products stand in contrast to those made from fossil fuels (such as petroleum) and other less renewable resources (such as virgin timber). Ahmad Maharma PMBOK 5th Edition 670
Terms to conditions (P)
• POINT OF ORIGIN(shipping point)The location where a shipment is received by a transportation line from the shipper.
• POLITICAL SUBDIVISIONA subdivision of a state which has been delegated certain functions of local government. Can include counties, cities, towns, villages, hamlets, boroughs and parishes.
• POST-CONSUMER MATERIALA finished material which would normally be disposed of as a solid waste after its life cycle as a consumer item is completed. Does not include manufacturing or converting wastes. This refers to material collected for recycling from office buildings, homes, retail stores, etc.
• PRE-CONSUMER MATERIALMaterial or by-products generated after the manufacture of a product but before the product reaches the consumer, such as damaged or obsolete products. Pre-consumer material does not include mill and manufacturing trim, scrap, or broken material which is generated at a manufacturing site and commonly reused on-site in the same or another manufacturing process.
• PREFERENCEAn advantage in consideration for award for a contract granted to a vendor by reason of the vendor's residence, business location, or business classifications (e.g., minority, small business).
• PREPAIDA term denoting that transportation charges have been or are to be paid at the point of shipment.
• PREQUALIFICATION OF VENDORSThe screening of potential vendors in which such factors as financial capability, reputation and management are considered when developing a list of qualified vendors. See Vendors List, Qualified Vendor/Responsible Vendor.
Ahmad Maharma PMBOK 5th Edition 671
Terms to conditions (P)
• PRICEThe amount of money that will purchase a definite weight or other measure of a commodity.
• PRICE AGREEMENTA contractual agreement in which a purchaser contracts with a vendor to provide the purchaser's requirements at a predetermined price. Usually involves a minimum number of units, orders placed directly with the vendor by the purchase, and limited duration of the contract. See Blanket Order and Requirements Contract.
• PRICE FIXINGAgreement among competing vendors to sell at the same price.
• PROCUREMENTThe combined functions of purchasing, inventory control, traffic and transportation, receiving, inspection, store keeping, and salvage and disposal operations.
• PROPRIETARYThe only items that can perform a function and satisfy a need. This should not be confused with "single source." An item can be proprietary and yet available from more than one source. For example, if you need a camera lens for a Nikon camera, the only lens that will fit is a Nikon lens, thus, this lens is "proprietary." However, the Nikon lens is available from more than one source, thus, it is not single source.
• PUBLIC PURCHASINGThe process of obtaining goods and services for public purpose following procedures implemented to protect public funds from being expended extravagantly or capriciously.
• PURCHASE MANUALA document that stipulates rules and prescribes procedures for purchasing with suppliers and other departments.
• PURCHASE ORDERThe signed written acceptance of the offer from the vendor. A purchase order serves as the legal and binding contract between both parties.
Ahmad Maharma PMBOK 5th Edition 672
Terms to conditions (Q)
• QUALIFIED VENDOR/RESPONSIBLE VENDORA vendor determined by a buying organization to meet minimum set standards of business competence, reputation, financial ability and product quality for placement on the vendor list.
• QUALIFIED PRODUCTS LIST (QPL)A list of products that, because of the length of time required for test and evaluation, are tested in advance of procurement to determine which suppliers comply with the specification requirements. Also referred to as an "approved brands list."
• QUALITYThe composite of material attributes, including performance features and characteristic, of a product or service to satisfy a given need.
• QUANTITYAmount or number.
• QUANTITY DISCOUNTA reduction in the unit price offered for large volume contracts.
• RECYCLED CONTENTThe portion of a product that is made from materials directed from the waste stream; usually stated as a percentage by weight.
• RECYCLED PRODUCTA product that contains the highest amount of post-consumer material practicable, or when post-consumer material is impracticable for a specific type of product, contains substantial amounts of pre-consumer material.
• REMANUFACTURED PRODUCTAny product diverted from the supply of discarded materials by refurbishing and marketing said product without substantial change to its original form.
• RENTA rental contract giving the right to use real estate or property for a specified time in return for rent or other compensation.
Ahmad Maharma PMBOK 5th Edition 673
Terms to conditions (R)
• REQUEST FOR BID (RFB)A solicitation in which the terms, conditions, and specifications are described and responses are not subject to negotiation.
• REQUEST FOR PROPOSAL (RFP)A solicitation in which it is not advantageous to set forth all the actual, detailed requirements at the time of solicitationand responses are subject to negotiation. Price must be a factor in the award but not the sole factor.
• REQUIREMENTMaterials, personnel or services needed for a specific period of time.
• REQUIREMENTS CONTRACTA form or contract that is used when the total long-term quantity required cannot be definitely fixed, but can be stated as an estimate or within maximum and minimum limits with deliveries on demand.
• REQUISITIONAn internal document that a functional department (stores, maintenance, production, etc.) sends to the purchasing department containing details of materials to meet its needs, replenish stocks or obtain materials for specific jobs or contracts.
• RESIDENT VENDORA person, firm, or corporation authorized to conduct business in the State of Minnesota on the date a solicitation for a contract is first advertised or announced. It includes a foreign corporation duly authorized to engage in business in Minnesota.
• RESPONDEROne who submits a response to a solicitation document.
• RESPONSEThe offer received from a vendor in response to a solicitation. A response includes submissions commonly referred to as "offers," "bids," "quotes," or "proposals."
• RESPONSIBLE BIDDERA bidder whose reputation, past performance, and business and financial capabilities are such that the bidder would be judged by an appropriate authority as capable of satisfying an organization's needs for a specific contract.
Ahmad Maharma PMBOK 5th Edition 674
Terms to conditions (R-S)
• RESTRICTIVE SPECIFICATIONSSpecifications that unnecessarily limit competition by eliminating items capable of satisfactorily meeting actual needs. See Performance Specification.
• REUSED PRODUCTAny product designed to be used many times for the same or other purpose without additional processing other than specific requirements, such as cleaning, painting or minor repairs.
• RFP OR RFB CONFERENCEA meeting arranged by a procurement office to help potential bidders understand the requirements of an RFB or an RFP.
• SALES TAXA levy on a vendor's sale by an authorized level of government.
• SEALEDA method determined by the commissioner to prevent the contents being revealed or known before the deadline for submission of responses.
• SERVICESUnless otherwise indicated, both professional or technical services and service performed under a service contract.
• SINGLE SOURCEAn acquisition where, after a search, only one supplier is determined to be reasonably available for the required product, service or construction item.
• SMALL BUSINESSA designation for certain statutory purposes referring to a firm, corporation or establishment having a small number of employees, low volume of sales, small amount of assets or limited impact on the market.
• SOLICITATIONThe process used to communicate procurement requirements and to request responses from interested vendors. A solicitation may be, but is not limited to a request for bid and request for proposal.
• SOURCE REDUCTION PRODUCTA product that results in a net reduction in the generation of waste, and includes durable, reusable and remanufactured products; products with no packaging or reduced packaging.
Ahmad Maharma PMBOK 5th Edition 675
Terms to conditions (S-T)
• SPECIFICATIONA concise statement of a set of requirements to be satisfied by a product, material or process that indicates whenever appropriate the procedures to determine whether the requirements are satisfied. As far as practicable, it is desirable that the requirements are expressed numerically in terms of appropriate units, together with their limits. A specification may be a standard, a part of a standard, or independent of a standard.
• STANDARDAn item's characteristic or set of characteristics generally accepted by the manufacturers and users of the item as a required characteristic for all such items.
• STANDARDIZATIONThe process of defining and applying the conditions necessary to ensure that a given range of requirements can normally be met, with a minimum of variety, in a reproducible and economic manner based on the best current techniques.
• SURPLUS PROPERTYProperty in excess of the needs of an organization and not required for its foreseeable use. Surplus may be used or new, but it possesses some usefulness for the purpose it was intended or for some other purpose.
• TABULATION OF RESPONSESThe recording of responses for the purposes of comparison, analysis and record keeping.
• TARGETED GROUP BUSINESS (TG)A certified business designated by the commissioner of Administration that is majority owned and operated by a woman, person with disabilities, or a member of a specific minority group who provides goods, products, or services within purchasing categories designated by the commissioner.
• TERMS AND CONDITIONSA phrase generally applied to the rules under which all bids must be submitted and the stipulations included in most purchase contracts; often published by the purchasing authorities for the information of all potential vendors.
• TITLEThe instrument or document whereby ownership of property is established.
Ahmad Maharma PMBOK 5th Edition 676
Terms to conditions ( T-V)• TORT
A wrongful act, other than a breach of contract, such that the law permits compensation of damages.
• TRUCKLOAD (TL)1. A quantity of freight to which truckload rates apply or a shipment tendered as a truckload.2. A highway truck or trailer loaded to its carrying capacity. See Less-Than-Truckload.
• UNIFORM COMMERCIAL CODE (UCC)A comprehensive modernization of various statutes relating to commercial transactions, including sales, lease, negotiable instruments, bank deposits and collections, funds transfers, letters of credit, bulk sales, documents of title, investment securities and secured transactions. The Minnesota law is found in Minn. Stat. Ch. 336.
• UNIT PRICEThe price of a selected unit of a good or service (e.g., pound, labor hours, etc.).
• UNSUCCESSFUL VENDORA vendor whose response is not accepted for reasons such as price, quantity, failure to comply with specifications, etc.
• VALUE ANALYSISAn organized effort directed at analyzing the function of systems, products, specifications, standards, practices, and procedures for the purpose of satisfying the required function at the lowest total cost of effective ownership consistent with the requirements for performance, reliability, quality and maintainability.
• VENDORSomeone who sells something; a "seller."
• VENDORS LISTA list of names and addresses of suppliers from whom bids, proposals and quotations might be expected. The list, maintained by the purchasing office, should include all suppliers who have expressed interest in doing business with the government.
• VIRGIN PRODUCTA product that is made with 100 percent new raw materials and contains no recycled materials.
• VOLATILE ORGANIC COMPOUNDS (VOCs)Compounds that evaporate easily at room tempurature and often have a sharp smell. They can come from many products, such as office equipment, adhesives, carpeting, upholstery, paints, solvents, and cleaning products. Some VOCs can cause cancer in certain situations, especially when they are concentrated indoors. VOCs also create ozone, a harmful outdoor air pollutant.
Ahmad Maharma PMBOK 5th Edition 677
Terms to conditions (W)
• WARRANTYThe representation, either expressed or implied, that a certain fact regarding the subject matter of a contract is presently true or will be true. Not to be confused with "guarantee," which means a contract or promise by one person to answer for the performance of another person.
Ahmad Maharma PMBOK 5th Edition 678
Project Management Professional
PMP®
Phase #3: PROJECT EXECUTION
Chapter 13: Stakeholder / 13.3 Manage Stakeholders
Engagement
Manage Stakeholders Engagement
The process of communicating and working with stakeholders to meet their needs and addressing issues as they occur.
Increases the likelihood that project will not veer off track due to unresolved stakeholders issues and unmatched expectations.
Key benefit is that it allows project manager to increase support and minimize resistance from stakeholders.
Ahmad Maharma PMBOK 5th Edition 680
Manage Stakeholders Expectations
Involves communication activities directed towards project stakeholders to influence their expectations, address concerns, and resolve issues. Such as:
Actively managing the expectations of stakeholders to increase the likelihood of project acceptance by negotiating and influencing their desires to achieve project goals.
Addressing concerns that have not become issues yet.
Clarifying and resolving issues that have been identified.
Ahmad Maharma PMBOK 5th Edition 681
Manage Stakeholder Engagement
Identify Stakeholders
Plan Stakeholder Management
Manage Stakeholder Engagement
ControlStakeholderEngagement
Ahmad Maharma PMBOK 5th Edition 682
Manage Stakeholders Engagement
Communication Methods
Interpersonal Skills
Management Skills
Issue Log
Change Requests
Organizational Process Assets Updates
Project Management Plan Updates
Project Document Updates
Stakeholder Management Plan
CommunicationsManagement Plan
Change Log
Organizational Process Assets
Ahmad Maharma PMBOK 5th Edition 683
Issue Logs
Also called action item log.
Tool to document and monitor the resolution of issues.
Addressed in order to maintain good, constructive working relationships.
Ahmad Maharma PMBOK 5th Edition 684
Interpersonal Skills
Building trust.
Resolving conflict.
Active listening.
Overcoming resistance to change.
Ahmad Maharma PMBOK 5th Edition 685
The 8 Steps for Leading Change*
Establishing a sense of urgency.
Creating the guiding coalition.
Developing a vision and strategy.
Communicating the change vision.
Empowering employees for broad-based action.
Generating short-term wins.
Consolidating (accumulating) gains and producing more change.
Anchoring new approaches in the culture.
* Leading Change- John P. Kotter
Ahmad Maharma PMBOK 5th Edition 686
Management Skills
Facilitate consensus toward project objectives
Influence people to support the project
Negotiate agreements to satisfy the project needs, and
Modify organizational behavior to accept the project outcomes
Ahmad Maharma PMBOK 5th Edition 687
Project Document (Update)
Stakeholder management strategy.
Stakeholder register.
Issue log.
Ahmad Maharma PMBOK 5th Edition 688
EQ vs. IQ
Ahmad Maharma PMBOK 5th Edition 689
What is Emotions?
“
Ahmad Maharma PMBOK 5th Edition 690
Emotions
Ahmad Maharma PMBOK 5th Edition 691
Can we Control Our Emotions?
عند ليس الشديد بالصرعة، إنما الشديد الذي يملك نفسه”•
“الغضب
“ال تغضب”•
والكاظمين الغيظ، والعافين عن الناس، وهللا يحب ”•
“المحسنين
“ال تحزن”•
Ahmad Maharma PMBOK 5th Edition 692
What is Emotional Intelligence?
Ahmad Maharma PMBOK 5th Edition 693
Goleman’s Framework of Emotional Competencies
Self Other
(Personal Competence) ( Social Competence)
Recognition
Regulation
Self Awareness
-Emotional self awareness -Accurate self-assessment -Self confidence
Social Awareness
-Empathy
-Organizational awareness -Service
Self –Management-Emotional self control -Transparency -Adaptation -Achievement -Initiative- Optimism
Relationship Management
-Inspirational leadership-Influence -Developing others -Change catalyst- Conflict Management-Building bonds -Teamwork and collaboration
Ahmad Maharma PMBOK 5th Edition 694
5.Team Leadership
-Communication
-Conflict Management
-Inspirational Leadership
EMOTIONAL INTELLIGENCE FRAMEWORK FOR PROJECT MANAGEMENT
3.Social Awareness
-Empathy -Organizational awareness - Emotional Boundaries
4. Relationship Management
-Stakeholder Relationship-Developing others -Truth Telling
1.Self Awareness
-Emotional self awareness -Accurate self-assessment -Self confidence
• 2.Self –
• Management
-Self -Control
Ahmad Maharma PMBOK 5th Edition 695
Emotional Intelligence Framework for Project Management
• 2.Self –
• Management
-Self -Control
1.Self Awareness
-Emotional self awareness -Accurate self-assessment -Self confidence
3.Social Awareness
-Empathy -Organizational awareness - Emotional Boundaries
4. Relationship Management
-Stakeholder Relationship-Developing others -Truth Telling
5.Team Leadership-Communication -Conflict Management -Inspirational leadership
Ahmad Maharma PMBOK 5th Edition 696
Emotional Intelligence Framework for Project Management
• 2.Self –
• Management
-Self -Control
1.Self Awareness
-Emotional self awareness -Accurate self-assessment -Self confidence
3.Social Awareness
-Empathy -Organizational awareness - Emotional Boundaries
4. Relationship Management
-Stakeholder Relationship-Developing others -Truth Telling
5.Team Leadership-Communication -Conflict Management -Inspirational leadership
Ahmad Maharma PMBOK 5th Edition 697
Self Awareness
Accurate Self-Assessment
– Aware of Strengths & Weaknesses
– Reflective, learning from experience
– Open to Candid Feedback
– Able to show a sense of humor and perspective about oneself.
Ahmad Maharma PMBOK 5th Edition 698
Self Awareness
Self Confidence
– Present self with self-assurance; have “presence”
– Can voice views and express opinion even if unpopular.
– Decisive.
– Able to make decisions despite uncertainties and pressure
Ahmad Maharma PMBOK 5th Edition 699
Self Awareness
Emotional Self-Awareness (red flags)
– Inappropriate Humor
– Use of Sarcasm
– Passive Aggressive Behavior
– Playing the Victim
– Hostility
Ahmad Maharma PMBOK 5th Edition 700
Emotional Intelligence Framework for Project Management
1.Self Awareness
-Emotional self awareness -Accurate self-assessment -Self confidence
3.Social Awareness
-Empathy -Organizational awareness - Emotional Boundaries
4. Relationship Management
-Stakeholder Relationship-Influence -Developing others -Truth Telling
5.Team Leadership-Communication -Conflict Management Inspirational Leadership
Ahmad Maharma PMBOK 5th Edition 701
Self- Control
Self-control is the ability to remain composed in spite of emotional state.
Self-control is for all emotions.
Ahmad Maharma PMBOK 5th Edition 702
Hot Buttons
Ahmad Maharma PMBOK 5th Edition 703
Techniques to Improve Self-Management
1- Identify the feeling
2- Determine the underlying cause
3- Take action to get clear
Ahmad Maharma PMBOK 5th Edition 704
Additional Techniques
1- Reduce your stress level
2- Conduct an Inner-Dialogue
3- Take it out with someone
4- Give yourself a time out
5- Write a letter or email you will not send
6- Take care of yourself
– And Remember: It’s not worth dying for!!!
Ahmad Maharma PMBOK 5th Edition 705
Emotional Intelligence Framework for Project Management
• 5.Team Leadership
• -Communication
• -Conflict Management
• Inspirational leadership
3.Social Awareness
-Empathy -Organizational awareness - Emotional Boundaries
4. Relationship Management
-Stakeholder Relationship-Influence -Developing others -Truth Telling
1.Self Awareness
-Emotional self awareness -Accurate self-assessment -Self confidence
2.Self –Management
- Self -Control
Ahmad Maharma PMBOK 5th Edition 706
Social Awareness
Empathetic Listening
– Let others speak
– Maintain eye contact
– Give the speaker your full attention
– Playback and summarize
– Try on their shoes
– Suspend our judgment
Ahmad Maharma PMBOK 5th Edition 707
Social Awareness
“The ability to read the currents of emotions and political realities in groups”
- Cary Cherniss and Daniel Goleman
• Organizational Awareness
Ahmad Maharma PMBOK 5th Edition 708
Social Awareness
Emotional Boundaries
“Good fences make good neighbors”
Ahmad Maharma PMBOK 5th Edition 709
Emotional Intelligence Framework for Project Management
• 3.Social Awareness
•
• -Empathy
• -Organizational awareness
• -Emotional Boundaries
• 4. Relationship Management
• -Stakeholder Relationship
• -Influence
• -Developing others
• -Truth Telling
1.Self Awareness
-Emotional self awareness -Accurate self-assessment -Self confidence
2.Self –Management
-Self –Control
5.Team Leadership
• -Communication
• -Conflict Management
• -Inspirational leadership
Ahmad Maharma PMBOK 5th Edition 710
Emotional Intelligence Framework for Project Management44
• 2.Self –Management
• -Self –Control
• 1.Self Awareness
• -Emotional self awareness
- Accurate self-assessment
- Self confidence
• 3.Social Awareness
•
• -Empathy
• -Organizational awareness
• - Emotional Boundaries
4. Relationship Management
-Stakeholder Relationship-Influence -Developing others -Truth Telling
5.Team Leadership
• -Communication
• -Conflict Management
• -Inspirational leadership
Ahmad Maharma PMBOK 5th Edition 711
PMBOK Reading Chapter 3
– Section 3.5
Chapter 4
– Section 4.3
Chapter 8
– Section 8.2
Chapter 9
– Sections 9.2 - 9.4
Chapter 10
– Sections 10.2
Chapter 12
– Section 12.2
Chapter 13
– Section 13.3Ahmad Maharma PMBOK 5th Edition 712
Project Management Professional
PMP®
PROJECT MONITORING & CONTROLLING
Project Management Professional
PMP®
Phase #4: PROJECT MONITORING & CONTROLLING
Chapter 4: Integration / 4.4 Monitor and Control
Project Work
Monitor & Control Project Work
The process of tracking, reviewing, and regulating the progress to meet the performance objectives defined in the project management plan.
It includes collecting, measuring, and distributing performance information, and assessing measurements and trends to effect process performance.
Ahmad Maharma PMBOK 5th Edition 715
Monitor & Control Project Work
Comparing actual work performance against the project management plan.
Assessing performance to determine whether any corrective or preventive actions are indicated, and then recommending those actions as necessary.
Identifying new risks and analyzing, tracking, and monitoring existing project risks to make sure the risks are identified, their status is reported, and that appropriate risk response plans are being executed.
Ahmad Maharma PMBOK 5th Edition 716
Monitor & Control Project Work
Maintaining an accurate, timely information base concerning the project’s product(s) and the associated documentation through project completion.
Providing information to support status reporting, progress measurement, and forecasting.
Providing forecasts to update current cost and current schedule information; and
Monitoring implementation of approved changes as they occur.
Ahmad Maharma PMBOK 5th Edition 717
Monitor & Control Project Work
Expert Judgment
Analytical Techniques
Project management information software
Meetings
Change Requests
Work performance reports
Project Management Plan Updates
Project Document Updates
Project Management PlanSchedule
ForecastsCost ForecastsValidated ChangesWork
Performance ReportsEnterprise
Environmental FactorsOrganizational
Process Assets
Ahmad Maharma PMBOK 5th Edition 718
Change Requests
Needed because change is inevitable.
Happen as a result of comparing actual results with planned results
May:
– Expand
– Adjust
– Reduce
– Project and product scope
Ahmad Maharma PMBOK 5th Edition 719
Changes May Include
Corrective Actions: A documented direction for executing the project work to bring expected future performance of the project work in line with the project management plan.
Preventive Actions: A documented direction to perform an activity that can reduce the probability of negative consequences associated with project risks.
Defect Repairs: The formally documented identification of a defect in a project component with a recommendation to either repair the defect or completely replace the component.
Ahmad Maharma PMBOK 5th Edition 720
Perform Integrated Change Control
The process of reviewing all change requests, approving changes and managing changes to the deliverable, organizational process assets, project documents, and the project management plan.
Conducted from project inception through completion.
Ahmad Maharma PMBOK 5th Edition 721
Perform Integrated Change Control
Influencing the factors that circumvent integrated change control so that only approved changes are implemented.
Reviewing, analyzing, and approving change requests promptly, which is essential, as a slow decision may negatively affect time, cost or the feasibility of the change.
Managing the approved changes.
Maintaining the integrity of baseline by releasing only approved changes for incorporation into the project management plan and project documents.
Ahmad Maharma PMBOK 5th Edition 722
Perform Integrated Change Control
Reviewing, approving, or denying all recommended corrective and preventive actions.
Coordinating changes across the entire project (e.g., a proposed schedule change will often affect cost, risk, quality, and staffing); and
Documenting the complete impact of change requests.
Ahmad Maharma PMBOK 5th Edition 723
Facts About Integrated Change Control
Change control is necessary because projects seldom run exactly according to project management plan.
Changes are incorporated into a revised plan.
Corrective and preventive actions are taken to control the project performance.
Monitoring gives insight on project health & areas that require special attention.
Ahmad Maharma PMBOK 5th Edition 724
Steps for Integrated Change Control
Prevent the root cause of change.
Identify change.
Create a change request.
Assess the change.
Assess impact.
Perform integrated change control.
Look for options.
Approve or reject change.
Adjust the project management plan and baseline.
Notify stakeholders.
Manage the project to new project management plan.
Ahmad Maharma PMBOK 5th Edition 725
Impacts of change are
evaluated on the
schedule , cost , and/or quality
PM presents the change
to the committee for approval with impacts &
alternatives ) if any (
Details are sent to the PM
Change
Approved
Change and its impacts
are logged in the
Changes Log , necessary
amendments to the plan ,
deliverables , change
orders , and invoices are
processed
Change is either discarded , logged in
future enhancements or issues log
Decision Made
YES
NO
Risks List
Changes
Log
Project Cost
Project Plan
Change Management Procedure
Name of Project
Change Request is filled ,
with reasons , details , and
possible impacts .
Event happens to
trigger a change
to the Scope by
***** or one of its
partners
Change Request is
logged in the Changes
Log as Change
Requested
Issue
Change
Order?
Ahmad Maharma PMBOK 5th Edition 726
Project Management Professional
PMP®
Phase #4: PROJECT MONITORING & CONTROLLING
Chapter 4: Integration / 4.5 Perform Integrated
Change Control
Perform Integrated Change Control
Expert Judgment
Meetings
Change Control Tools
Approved Change Request
Change Log
Project Management Plan Updates
Project Document Updates
Project Management Plan
Work Performance Reports
Change Requests
Enterprise Environmental Factors
Organizational Process Asset
Ahmad Maharma PMBOK 5th Edition 728
Configuration Management System
A configuration management system with integrated change control provides a standardized, efficient and effective way to centrally manage approved changes and baselines within a project.
Configuration control is focused on the specifications of both the deliverables and processes,
While change control is focused on identifying, documenting and controlling changes to the project and product baselines.
Ahmad Maharma PMBOK 5th Edition 729
Configuration management with integrated change control processes achieve the following objectives;
– Establishes an evolutionary method to consistently identify and request changes to established baselines, and to assess the value and effectiveness of those changes
– Provides opportunities to continuously validate and improve the project by considering the impact of each change, and
– Provides the mechanism for the project management team to consistently communicate all approved and rejected changes to the stakeholders
CONFIGURATION MANAGEMENT SYSTEM
Ahmad Maharma PMBOK 5th Edition 730
Configuration Management Activities
Configuration Identification
Configuration Status Accounting
Configuration Verification and Audit
Ahmad Maharma PMBOK 5th Edition 731
Configuration Identification
Selection and identification of a configuration item provide the basis for which product configuration is defined and verified, products and documents are labeled, changes are managed, and accountability is maintained.
Ahmad Maharma PMBOK 5th Edition 732
Configuration Status Accounting
Information is recorded and reported as to when appropriate data about the configuration item should be provided. The information includes a listing of approved configuration identification, status of proposed changes to the configuration, and the implementation status of approved changes.
Ahmad Maharma PMBOK 5th Edition 733
Configuration Verification and Audit
Configuration verifications and configuration audits ensure the composition of a project’s configuration items is correct and that corresponding changes are registered, assessed, approved, tracked and correctly implemented. This ensures the functional requirements defined in the configuration documentation can be met.
Ahmad Maharma PMBOK 5th Edition 734
Project Management Professional
PMP®
Phase #4: PROJECT MONITORING & CONTROLLING
Chapter 5: Scope / 5.5 Validate Scope
Validate Scope
The process of formalizing acceptance of the completed project deliverables.
Includes reviewing deliverables with the customer or sponsor to ensure that they are completed satisfactorily and obtaining formal acceptance of deliverables by the customer or sponsor.
Ahmad Maharma PMBOK 5th Edition 736
Validate Scope Vs. Quality Control
Verify scope is concerned with acceptance of work results while perform quality control is concerned with the correctness of the work results.
Quality control is generally performed before scope verification, but the two processes can be performed in parallel.
Ahmad Maharma PMBOK 5th Edition 737
Validate Scope
Plan Scope Management
Control Scope
Validate Scope
Define Scope
Create WBS
CollectRequirements
Ahmad Maharma PMBOK 5th Edition 738
Validate Scope
Inspection
Group decision-making techniques
Accepted Deliverables
Change Requests
Work performance information
Project Document Updates
Project Management Plan
Requirements documentation
Requirements traceability matrix
Verified deliverables
Work performance data
Ahmad Maharma PMBOK 5th Edition 739
Project Management Professional
PMP®
Phase #4: PROJECT MONITORING & CONTROLLING
Chapter 5: Scope / 5.6 Control Scope
Control Scope
The process of monitoring the status of the project and product scope and managing changes to the scope baseline.
Controlling project scope ensures all requested changes and recommended corrective or preventive actions are processed through the Perform Integrated Change Control process.
Ahmad Maharma PMBOK 5th Edition 741
Control Scope
Project scope control is also used to manage the actual changes when they occur and is integrated with the other control processes.
Uncontrolled changes are often referred to as “project scope creep”
Ahmad Maharma PMBOK 5th Edition 742
Control Scope
Plan Scope Management
Control Scope
Validate Scope
Define Scope
Create WBS
CollectRequirements
Ahmad Maharma PMBOK 5th Edition 743
Control Scope
Variance Analysis
Work Performance InformationOrganizationa
l Process Assets UpdatesChange
RequestsProject
Management Plan UpdatesProject
Document Updates
Project Management PlanWork
performance dataRequirements
documentationRequirements
traceability matrixOrganizational
Process Assets
Ahmad Maharma PMBOK 5th Edition 744
Variance Analysis
Project performance measurements are used to assess the magnitude of variation from the original baseline.
It determines the cause and degree of variance relative to the scope baseline, and decides whether corrective or preventive action is required.
Ahmad Maharma PMBOK 5th Edition 745
Control Schedule
The process of monitoring the status of the project to update project progress and manage changes to the schedule baseline.
Schedule control is concerned with:
– Determining the current status of project schedule.
– Influencing the factors that create schedule changes.
– Determining that the project schedule has changed, and
– Managing the actual changes as they occur.Ahmad Maharma PMBOK 5th Edition 746
Project Management Professional
PMP®
Phase #4: PROJECT MONITORING & CONTROLLING
Chapter 6: Time / 6.7 Control Schedule
Control Schedule
DefineActivities
Develop Schedule
Estimate Activity
Durations
Sequence Activities
Estimate Activity
Resources
ControlSchedule
Plan Schedule Management
Ahmad Maharma PMBOK 5th Edition 748
Control Schedule
Performance Reviews
Project Management Software
Resource Optimization Techniques
Modeling Techniques
Leads & Lags
Schedule Compression
Scheduling Tool
Work Performance Information
Schedule Forecasts
Organizational Process Assets Updates
Change Requests
Project Management Plan Updates
Project Document Updates
Project Management Plan
Work performance data
Project Schedule
Project calendars
Schedule data
Organizational Process Assets
Ahmad Maharma PMBOK 5th Edition 749
Project Management Professional
PMP®
Phase #4: PROJECT MONITORING & CONTROLLING
Chapter 7: Cost / 7.4 Control Costs
Control Cost
The process of monitoring the status of the project to update the project budget and managing changes to the cost baseline.
Involves recording actual costs spent to date.
Important to determine:
– Cause of a variance, whether positive or negative.
– Magnitude of the variance.
– Decide if variance requires corrective action.
Ahmad Maharma PMBOK 5th Edition 751
Control Cost Includes
Influence the factors that create changes to the cost baseline.
Ensuring requested changes are agreed upon.
Managing the actual changes when they occur.
Assuring that potential cost overruns do not exceed the authorized funding periodically and in total.
Monitoring cost performance to detect and understand variances from the cost baseline.
Recording all appropriate changes accurately against the cost baseline.
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.Ahmad Maharma PMBOK 5th Edition 752
Control Costs
Plan CostManagement
EstimateCosts
Determine Budget
ControlCosts
Ahmad Maharma PMBOK 5th Edition 753
Control Costs
Earned Value Management
Forecasting
To-complete Performance Index
Performance Reviews
Reserve Analysis
Project Management Software
Work Performance Information
Cost Forecasts
Organizational Process Assets Updates
Change Requests
Project Management Plan Updates
Project Document Updates
Project Management Plan
Work performance data
Project Funding Requirements
Organizational Process Assets
Ahmad Maharma PMBOK 5th Edition 754
Earned value Management (EVM)
Methodology that measures project progress by comparing actual schedule & cost performance against planned performance as laid out in the schedule & cost baseline.
Work does not earn value until it is completed.
Ahmad Maharma PMBOK 5th Edition 755
Earned value Management (EVM)
Relates Three Values:
– Planned Value (PV)
– Earned Value (EV)
– Actual Costs (AC)
– Budget At Completion (BAC).
Ahmad Maharma PMBOK 5th Edition 756
Planned Value (PV)
Budgeted Cost of Work Scheduled (BCWS)
Ahmad Maharma PMBOK 5th Edition 757
Planned Value (PV) [was Budgeted Cost of Work
Scheduled (BCWS)]
758
JAN FEB MAR APR MAY
Work Package #140 40 40 100 60
Work Package #2100 50 70 20
Work Package #340 40 60
Work Package #450 70 60 120
PV = 140 180 220 240 180 BAC = 960
Cumulative PV = 540
How much work should be done (what you planned to do)
Ahmad Maharma PMBOK 5th Edition
Earned Value (EV)
Budgeted Cost of Work Performed (BCWP)
Ahmad Maharma PMBOK 5th Edition 759
Earned Value (EV) [was Budgeted Cost of Work
Performed (BCWP)]
760
JAN FEB MAR APR MAY
Work Package #140 40 40 100 60
100% Complete (280)
Work Package #2100 50 70 20
75% Complete (180)
Work Package #340 40 60
50% Complete (70)
Work Package #450 70 60 120
20% Complete (60)
PV = 140 180 220 240 180 BAC = 960
PV = 540
EV = 590
How much work is done on a budgeted basis (what you’ve actually
done)
Work completed during a given period of time = “Earned Value”
Ahmad Maharma PMBOK 5th Edition
ACTUAL COSTS (AC)
Actual Cost of Work Performed (ACWP)
Ahmad Maharma PMBOK 5th Edition 761
Actual Cost (AC) [was Actual Cost of Work
Performed (ACWP)]
762
JAN FEB MAR APR MAY
Work Package #140 40 40 100 60
100% Complete (280)
Work Package #2100 50 70 20
75% Complete (180)
Work Package #340 40 60
50% Complete (70)
Work Package #450 70 60 120
20% Complete (60)
PV = 140 180 220 240 180 BAC = 960
PV = 540
EV = 590
AC = 560 (not calculated here)
How much did the “is done” work cost (what you actually
spent or what it actually cost)
Ahmad Maharma PMBOK 5th Edition
Schedule Variance
Any difference between the scheduled completion of an activity and the actual completion of that activity.
Schedule Variance is the earned value minus the planned value
Schedule Variance = Earned Value - Planned Value
SV = EV - PV
Ahmad Maharma PMBOK 5th Edition 763
Schedule Variance (SV)
• EV - PV: “Value of Work Performed less value of Work Scheduled”
• *A Negative number indicates a “Potential Slip”
• Schedule Variance status does:– indicate the dollar value difference between
– work that is ahead or behind the plan
– reflect a given measurement method
• Schedule Variance status does not:– address impact of work sequence
– address importance of work
– reflect critical path assessment
– indicate amount of time it will slip
– identify source (labor & material) of difference
– indicate the time ahead/behind (or regain) schedule
– indicate the cost needed to regain schedule
764
Example:
PV = $250
EV = $200
SV = EV - PV
= $200 - $250
= - $50
Ahmad Maharma PMBOK 5th Edition
Cost Variance
Any difference between the budgeted cost of an activity and the actual cost of that activity.
Cost Variance is the earned value minus the planned value
Cost Variance = Earned Value – Actual Cost
CV = EV - AC
Ahmad Maharma PMBOK 5th Edition 765
Cost Variance (CV)
766
EV - AC: “Value of Work Performed for Each Dollar’s
Worth of Work Scheduled”
*A Negative number indicates an “Overrun”
Example:
EV = $200
AC = $190
CV = EV - AC
= $200 - $190
= $10
Ahmad Maharma PMBOK 5th Edition
Variance Values
Schedule Variance:
– If SV= 0, then schedule is on track.
– If SV 0, then project is ahead of schedule
– If SV 0, then project is behind schedule
Cost Variance
– If CV= 0, then project is on budget.
– If CV 0, then project is below budget (Cost Saving)
– If CV 0, then project is above budget (Cost Overrun)
Ahmad Maharma PMBOK 5th Edition 767
Schedule Performance Index (SPI)
SPI = EV / PV
Ahmad Maharma PMBOK 5th Edition 768
Schedule Performance Index (SPI)
769
Is a Measure of Contractor “Schedule Efficiency”
SPI = EV/PV
Less Than 1.0 is unfavorable = BEHIND schedule
Greater Than 1.0 is favorable = AHEAD of schedule
Example:
PV = $250
EV = $200
SPI = EV/PV
= $200/$250
= .80
Ahmad Maharma PMBOK 5th Edition
Cost Performance Index (CPI)
CPI = EV / AC
Ahmad Maharma PMBOK 5th Edition 770
Cost Performance Index (CPI)
771
Is a Measure of Contractor “Cost Efficiency”
CPI = EV/AC
Less Than 1.0 is unfavorable = Cost is GREATER than budgeted
Greater Than 1.0 is favorable = Cost is LESS than budgeted
Example:
EV = $200
AC = $190
CPI = EV/AC
= $200/$190
= 1.05
Ahmad Maharma PMBOK 5th Edition
Performance Index Values
Schedule Variance:
– If SPI= 1, then schedule is on track.
– If SPI 1, then project is ahead of schedule
– If SPI 1, then project is behind schedule
Cost Variance
– If CPI= 1, then project is on budget.
– If CPI 1, then project is below budget (Cost Saving)
– If CPI 1, then project is above budget (Cost Overrun)
Ahmad Maharma PMBOK 5th Edition 772
Forecasting
Estimate To Complete (ETC)
Estimate At Completion (EAC)
Ahmad Maharma PMBOK 5th Edition 773
Estimate To Complete (ETC)
When current variances are seen as atypical and similar changes will not continue to happen in the future
• ETC= BAC-EV
When current variances are seen as typical of future variances
• ETC= (BAC-EV)/CPI
When past performance show that the original estimating assumptions were fundamentally flawed, estimates to completion has to be re-calculated
• ETC= BTC
Ahmad Maharma PMBOK 5th Edition 774
Estimate At Completion (EAC)
When past performance show that the original estimating assumptions were fundamentally flawed:
– EAC = AC + BTC When current variances are seen as atypical and similar
changes will not continue to happen in the future:
– EAC = AC + (BAC – EV) When current variances are seen as typical of future
variances
– EAC = AC + [(BAC –EV)/CPI]
Ahmad Maharma PMBOK 5th Edition 775
Forecasting - Estimate at Completion (EAC)
776
What is Estimate at Completion (EAC)
Expected total cost for a defined scope of work
Forecast of most likely total project cost
Techniques for developing EAC:
EAC = Actuals to date plus a new estimate for all remaining work (AC + ETC)
*What is ETC? Estimate to Complete (ETC) is the cost for all remaining
work.
EAC = BAC/CPI Total project budget divided by the cost performance index
EAC = AC +BAC – EV
EAC = AC + (BAC – EV)/CPI
Ahmad Maharma PMBOK 5th Edition
Variance At Completion (VAC)
How much over or under budget do we expect
to be at the end of the project
VAC = Budget at Completion - Estimate at Completion
= BAC - EAC
Ahmad Maharma PMBOK 5th Edition 777
To-Complete Performance Index (TCPI)
This helps in determining the efficiency that must be achieved on the remaining work in order for the project to meet a specified end point such as Budget at Completion (BAC) or Estimate at completion (EAC)
TCPI= Work Remaining/ Funds Remaining
TCPI based on the BAC:
– TCPI = (BAC-EV) / (BAC-AC)
TCPI based on the EAC:
– TCPI = (BAC-EV) / (EAC-AC)
Ahmad Maharma PMBOK 5th Edition 778
To-Complete Performance Index (TCPI)
• Helps the team determine the efficiency that must be achieved on
the remaining work for a project to meet a specified endpoint, such
as BAC or the team’s revised EAC
• TCPI AC)- (EAC or – AC)(BAC Remaining Funds
EV) – (BAC Remaining Work
Ahmad Maharma PMBOK 5th Edition 779
7.3 Control Cost – Tools and techniques
780Ahmad Maharma PMBOK 5th Edition
Budget At Completion (BAC)
Project Estimated Budget
Ahmad Maharma PMBOK 5th Edition 781
Budget at Completion (BAC)
782
What is Budget at Completion (BAC)
•Sum of the total budgets for a project
BAC = Cum PV (BCWS) for all work packages in the
project
Ahmad Maharma PMBOK 5th Edition
Forecasting EAC• Common alternative way to calculate EAC
Table captured from Practice Standard for Earned Value Management, PMI © 2005Ahmad Maharma PMBOK 5th Edition 783
Earned Value Graph
784Time
Cost
BCWS (PV)(Planned)
BCWP (EV)(Accomplishment)
ACWP (AC)(Actual)
EAC(Forecast)
Spending
Variance
Schedule
Variance
Cost
Variance
40 Mos.
BAC(Total Budget)
$300M
24 Mos.
CPI
$360M
Cost Overrun
52 Mos.
Schedule
Slippage
Ahmad Maharma PMBOK 5th Edition
Earned Value Technique
Terms and Formulas Definition
Budget at completion (BAC) How much did we BUDGET for the TOTAL project effort?
Estimate at Completion (EAC)
= BAC / CPI
What do we currently expect the TOTAL project cost (a
forecast)?
Estimate to Complete (ETC)
= EAC - AC
From this point on, how much MORE do we expect it to cost to
finish the project (a forecast)?
Variance at Completion (VAC)
= BAC – EAC
As of today, how much over or under budget do we expect to
be at the end of the project?
• EAC is an important forecasting value.
Ahmad Maharma PMBOK 5th Edition 785
Earned Value: Graphical Representation
TIME
COST
ScheduleVariance
(SV)
CostVariance
(CV)
ACTUAL
PLAN
EARNVALUE
Estimate at Completion
(EAC)
Budget at Completion
(BAC)
Projection of schedule delay at completion
Projection of cost variance at completion
(VAC)
TODAY(Reporting day)
BAC
EAC
AC
EV
PV
Project is over budget &
behind schedule Ahmad Maharma PMBOK 5th Edition 786
Earned Value Management
Image captured from Practice Standard for Earned Value Management, PMI © 2005
EV can be calculated by (%progress) x (planned man-days)
Ahmad Maharma PMBOK 5th Edition 787
Summary of Terms and Formulas
788
TERM DESCRIPTION INTERPRETATION
PV Planned ValueHow much work should be done (What you
planned to do)
EV Earned ValueHow much work is done on a budgeted basis
(What you’ve actually done)
AC Actual CostHow much did the “is done” work cost (What you
Actually spent)
BAC Budget at Completion How much you budgeted for the total project.
EAC Estimate at Completion What you currently expect the total project to cost
ETC Estimate to CompleteFrom a given point in time, what you currently
expect the remaining cost to be
VAC Variance at Completion How much over or under budget you expect to be
Ahmad Maharma PMBOK 5th Edition
Summary of Terms and Formulas
789
NAME FORMULA INTERPRETATION
Cost Variance
(CV)EV-AC Negative means over budget, Positive means under budget
Schedule
Variance (SV)EV-PV Negative means behind schedule, Positive means ahead of schedule
Cost
Performance
Index (CPI)
EV/AC You are getting X cents out of every $1
Schedule
Performance
Index (SPI)
EV/PV You progressing at X% of the rate originally planned
Estimate at
Completion
(EAC)
BAC/CPI or AC
+ ETCWhat, at this time, you expect the total project to cost
Estimate to
Completion
(ETC)
EAC - AC What, at this time, you expect the remaining scope to cost
Variance at
Completion
(VAC)
BAC - EACWhat, at this time, you expect the final project cost to be more or less
then budgeted.
Ahmad Maharma PMBOK 5th Edition
Present Value (PV) andNet Present Value (NPV)
790
Present Value (PV) - means the value today of future cash flows or
costs
PV = FV/(1 + r)n
Net Present Value (NPV) - means the total benefits less the costs.
NPV is done by calculating the present value of all benefits and costs,
then subtracting the total benefits from the total cost.
Note: FV = Future value,
r = interest rate
n = number of time periods
Ahmad Maharma PMBOK 5th Edition
Internal Rate of Return (IRR): Payback Period and Benefit Cost Ratio (BCR)
• Payback Period– number of time periods it takes to recover your
investment. The shorter time the better.
• Benefit Cost Ratio (BCR)– Compares the cost to the benefits on a project.
When dealing with multiple project options, you would select the project with the greatest BCR. BCR > 1 means benefits are greater than costs, BCR < 1 means costs are greater than benefits, and BCR = 1 means they are the same.
791Ahmad Maharma PMBOK 5th Edition
Earned Value Management• Method to measure project performance against scope, schedule
and cost baseline (performance measurement baseline)
• Interpretation of basic EVM performance measures
– Cost Performance Index (CPI)
– Schedule Performance Index (SPI)
Ahmad Maharma PMBOK 5th Edition 792
Earned Value Technique
Terms and Formulas Definition
Earned Value (EV) As of today, what is the estimated value of the
work actually accomplished?
Actual Cost (AC) As of today, what is the actual cost incurred for
the work accomplished?
Planned Value (PV) As of today, what is the estimated value of work
planned to be done?
Cost Variance (CV)
= EV - AC
Negative is over budget
Positive is under budget
Schedule Variance (SV)
= EV - PV
Negative is behind schedule
Positive is ahead schedule
Cost Performance Index
(CPI) = EV/AC
We are getting $__ worth of work out of every
$1 spent. Are funds being used efficiently?
Schedule Performance
Index (SPI) = EV/PV
We are (only) progressing at __ percent of the
rate originally planed
Example
$100K
$200K
$300K
$100K – $200K
= ($100K)
$100K - $300K
= ($200K)
$100K/$200K
= 0.5 i.e. 50%
$100K/$300K
= 0.33 i.e 33%
Example:
Project Budget: $400K
Project Schedule: 4
months
At the 3 month
checkpoint:
Spent: $200K
Work completed: $100K
Revised Total Duration Baseline Duration/Schedule Performance Index4/0.33
= 12 monthsAhmad Maharma PMBOK 5th Edition 793
Exercise
Task Progress Cost spent
Side 1 ||||||||||||||||||||||||||||||||||||||||100% $1,200
Side 2 ||||||||||||||||||||||||||||||||||||||||100% $1,000
Side 3 ||||||||||||||||||||||||||||||75% $750
Side 4 ||||||||||||||||||||50% $500
Side 5 0% $0
Side 6 0% $0
You have a project to build a box. The box is six sided. Each side is to take one day
to build and is budgeted for $1000 per side. The sides are planned to be completed
one after the other. Today is the end of day three.
Using the following project status chart, calculate PV, EV, AC, BAC, CV, CPI, SV,
SPI, EAC, ETC, VAC.
Describe your interpretation based on the calculation!
Ahmad Maharma PMBOK 5th Edition 794
Exercise SolutionParameter Calculation Result
PVEVACBACCVCPISVSPIEACETCVAC
Project is below/over budget?
Project is late/ahead schedule?
How much more money we need?
Ahmad Maharma PMBOK 5th Edition 795
Exercise SolutionParameter Calculation Result
PV 1000 + 1000 + 1000 3000EV (100% x 1000) + (100% x 1000) + (75% x 1000) + (50% x 1000) 3025AC 1200 + 1000 + 750 + 500 3450BAC 6 x 1000 6000CV 3025 - 3450 -425CPI 3025 / 3450 0.88SV 3025 - 3000 25SPI 3025 / 3000 1.01EAC 6000 / 0.88 6818.18ETC 6818.18 - 3450 3368.18VAC 6000 - 6818.18 -818.18
over budget, getting 0.88 dollar for every dollar we spent,
ahead schedule, progressing 101% of the rate planned,
probably will spend $6818 at the end (estimation),
need $3368 to complete,
over budget at the end for about $818 (estimation)
Ahmad Maharma PMBOK 5th Edition 796
Earned Schedule - An emerging EVM practice
• SPI($) – At project start SPI is reliable
– At some point SPI accuracy diminishes
– Toward the project end it is useless (SPI = 1 at project end)
– Doest not show weeks/months of schedule variance
• SPI(t)– Time based schedule measures
– Create a SPI that is accurate to the of the project
SV(t) = ES – AT
SPI(t) = ES / AT
• ES = Earned Schedule (Planned time)
• AT = Actual timeSee more resources about earned schedule at http://www.earnedschedule.com Ahmad Maharma PMBOK 5th Edition 797
EVM – Hints to remember
• EV comes first in every formula
• If it’s variance, the formula is EV – something
• If it’s index, EV / something
• If it relates to cost, use Actual Cost
• If it relates to schedule, use PV
• Negative numbers are bad, positive is good
Copied from Rita’s bookAhmad Maharma PMBOK 5th Edition 798
Earned Value Chart
799Ahmad Maharma PMBOK 5th Edition
Basic Principles of Cost Management
• Most members of an executive board have a better understanding and are more interested in financial terms than IT terms, so IT project managers must speak their language.
– Profits are revenues minus expenses.
– Life cycle costing considers the total cost of ownership, or development plus support costs, for a project.
– Cash flow analysis determines the estimated annual costs and benefits for a project and the resulting annual cash flow.
800Ahmad Maharma PMBOK 5th Edition
Cash Flow, Cost Baseline and Funding
801Time
Cu
mu
lative
Va
lue
s
Cost baseline
Expected Cash Flow
Funding
Extra
reserve at
end of
project
Ahmad Maharma PMBOK 5th Edition
Project Management Professional
PMP®
Phase #4: PROJECT MONITORING & CONTROLLING
Chapter 8: Quality / 8.3 Control Quality
Control Quality
The process of monitoring and recording results of executing the quality activities to assess performance and recommend necessary changes.
Quality control activities identify causes of poor process or product quality and recommend and/or take action to eliminate them.
Ahmad Maharma PMBOK 5th Edition 803
Quality Control-Related Terms
Prevention (keeping errors out of the process) and inspection (keeping errors out of the hands of the customer).
Attribute sampling (the result either conforms or not) versus variable sampling (the result is rated on a continuous scale that measure the degree of conformity).
Special causes (unusual events) and common causes (normal process variation).
Tolerances (specified range of acceptable results) and control limits (range of process in control).
Ahmad Maharma PMBOK 5th Edition 804
Control QualityPlan
Quality Management
Perform Quality
Assurance
ControlQuality
Ahmad Maharma PMBOK 5th Edition 805
Control Quality
Seven basic Quality Tools
Statistical sampling
Inspection
Approved Change Requests Review
Quality Control Measurements
Validated Changes
Validated Deliverables
Work Performance Information
Organizational Process Assets Updates
Change Requests
Project Management Plan Updates
Project Document Updates
Project Management Plan
Quality Metrics
Quality Checklists
Work Performance data
Approved Change Requests
Deliverables
Project documents
Organizational Process Assets
Ahmad Maharma PMBOK 5th Edition 806
Project Management Professional
PMP®
Phase #4: PROJECT MONITORING & CONTROLLING
Chapter 10: Communications / 10.3 Control communications
Control Communications
Monitoring & controlling communications throughout the entire project lifecycle to ensure the information needs of the project stakeholders are met.
It ensures an optimal information flow among all communication participants, at any moment of time.
Ahmad Maharma PMBOK 5th Edition 808
Plan Communications Management
Plan Communications
Management
Manage Communications
ControlCommunications
Ahmad Maharma PMBOK 5th Edition 809
Control Communications
Information Management System
Expert Judgment
Meetings
Work Performance Information
Organizational Process Assets Updates
Change Requests
Project Management Plan Update
Project Document Updates
Project Management Plan
Work Performance Data
Project Communications
Issue Log
Organizational Process Assets
Ahmad Maharma PMBOK 5th Edition 810
Project Management Professional
PMP®
Phase #4: PROJECT MONITORING & CONTROLLING
Chapter 11: Risks/ 11.6 Control Risks
Control Risks
The process of implementing risk response plans, tracking identified risks, monitoring residual risks, identifying new risks, and evaluating risk process effectiveness throughout the project.
Ahmad Maharma PMBOK 5th Edition 812
Control Risks
It determines if:
Project assumptions are still valid.
Analysis shows an assessed risk has change or can be retired.
Risk Management policies and procedures are being followed.
Contingency reserves of cost or schedule should be modified in alignment with the current risk assessment.
Ahmad Maharma PMBOK 5th Edition 813
Control Risks
Plan Risk Management
Plan Risk Responses
Perform Quantitative
RiskAnalysis
IdentifyRisks
Perform Qualitative
RiskAnalysis
Control Risks
Ahmad Maharma PMBOK 5th Edition 814
Control Risks
Risk Register
ProjectManagement Plan
Work Performance Data
Performance Reports
Risk Reassessment
Risk Audits
Variance & Trend Analysis
Technical Performance Measurement
Reserve Analysis
Meetings
Work Performance Information
Organizational Process Assets Updates
Change Requests
Project Management Plan updates
Project Document Updates
Ahmad Maharma PMBOK 5th Edition 815
Risk Reassessment
Should be scheduled regularly.
Should be an agenda item at project team status meetings.
Ahmad Maharma PMBOK 5th Edition 816
Risk Register Updates
Outcomes of risk reassessments.
Actual outcomes of risks and risk responses.
Ahmad Maharma PMBOK 5th Edition 817
Project Management Professional
PMP®
Phase #4: PROJECT MONITORING & CONTROLLING
Chapter 12: Procurement / 12.3 Control Procurement
Control Procurements
The process of managing procurement relationships, monitoring contract performance, and making changes and corrections as needed
Ahmad Maharma PMBOK 5th Edition 819
Control Procurements-Highlights
Reviewing and documenting how a seller is performing or has performed to establish required corrective actions and provide a basis for future relationships with the seller
Managing contract related changes
When appropriate managing the contractual relationship with the outside buyer of the project.
Can include managing interfaces across providers.
For some organizations, might be separate from project organization. In this case a contract administrator on the project team reports to a different department.
Ahmad Maharma PMBOK 5th Edition 820
Control Procurements
PlanProcurements Management
Conductprocurements
ControlProcurements
CloseProcurements
Ahmad Maharma PMBOK 5th Edition 821
Control Procurements
• Contract change control system
• Procurement performance reviews
• Inspections and audits
• Performance reporting
• Payment systems
• Claims administration
• Records management system
Work Performance Information
Organizational Process Assets Updates
Change Requests
Project Management Plan Updates
Project Documents Updates
Project Management Plan
Procurement Documents
Agreements
Work Performance Reports
Approved Change Requests
Work Performance Data
Ahmad Maharma PMBOK 5th Edition 822
Procurement Performance Review
A structured review of seller’s progress to deliver project scope and quality within cost and on schedule, as compared to contract.
It can include a review of seller-prepared documentation and buyer inspections, as well as quality audits conducted during seller’s execution of the work.
Objectives are:
Identify performance success or failure.
Identify progress compared to contract statement of work.
Identify contract non-compliance to determine seller’s ability or inability to deliver.
Ahmad Maharma PMBOK 5th Edition 823
Payment Systems
Processed by the “Accounts Payable” system of the buyer
After certification of satisfactory work by an authorized person on the project team.
All payments are made in accordance with contract terms.
Ahmad Maharma PMBOK 5th Edition 824
Claims Administration
The process of documenting, processing, managing, and monitoring claims throughout the contract lifecycle, in accordance with terms of contract.
Contested changes and potential constructive changes are those requested changes where the buyer and seller cannot reach an agreement on compensation for the change.
If parties involved cannot resolve claims, it maybe handled in accordance with Alternative Dispute Resolution (ADR) or through negotiation.
Ahmad Maharma PMBOK 5th Edition 825
Records Management System
Used by project manager to manage contract documents and records.
It consists of a specific 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.
The system contains a retrievable archive of contract documents and correspondence.
Ahmad Maharma PMBOK 5th Edition 826
Project Management Professional
PMP®
Phase #4: PROJECT MONITORING & CONTROLLING
Chapter 13: Stakeholders/ 13.4 Control Stakeholders
Engagement
Control Stakeholder Engagement
The process of monitoring overall project stakeholders relationship and adjusting strategies and plans for engaging stakeholders.
It maintains and increases the efficiency and effectiveness of stakeholder engagement activities as the project evolves and its environment changes.
Ahmad Maharma PMBOK 5th Edition 828
Control Stakeholder Engagement
Identify Stakeholders
Plan Stakeholder Management
Manage Stakeholder Engagement
ControlStakeholderEngagement
Ahmad Maharma PMBOK 5th Edition 829
Control Stakeholder Engagement
Information Management System
Expert Judgment
Meetings
Work Performance Information
Change Requests
Organizational Process Assets Updates
Project Management Plan Updates
Project Document Updates
Project Management Plan
Issue Log
Work Performance Data
Project Documents
Ahmad Maharma PMBOK 5th Edition 830
PMBOK Reading
Chapter 3
Section 3.6
Chapter 4
Section 4.4, 4.5
Chapter 5
Section 5.5, 5.6
Chapter 6
Section 6.7
Chapter 7
Section 7.4
Chapter 8Section 8.3
Chapter 10
Sections 10.3
Chapter 11
Section 11.6
Chapter 12
Section 12.3
Chapter 13
Section 13.4
Ahmad Maharma PMBOK 5th Edition 831
Project Management Professional
PMP®
Phase #5: PROJECT CLOSING
Closing Processes
Close ProjectOr Phase
Close Procurements
Integration Procurement
Ahmad Maharma PMBOK 5th Edition 833
Project Management Professional
PMP®
Phase #5: PROJECT CLOSING
Chapter 4: Integration / 4.6 Close Project or Phase
Close Project or Phase
The process of finalizing all activities across all of the Project Management Process Groups to formally complete the project or phase.
When closing a project, project manager reviews all prior information from the previous phase closure to ensure all project work is completed and that the project has met its objectives.
Formally establishes that the project or project phase is finished.
Also establishes the procedures to investigate and document the reasons for actions taken if a project is terminated before completion
Ahmad Maharma PMBOK 5th Edition 835
Close Project or Phase
Close ProjectOr Phase
Close Procurements
Integration Procurement
Ahmad Maharma PMBOK 5th Edition 836
Close Project or Phase
Completing the project scope doesn’t mean that the project is done.
What remains is:
Collecting & finalizing paperwork.
Verifying that project product is acceptable.
Transferring completed project product to those who will use it & return resources back.
Ahmad Maharma PMBOK 5th Edition 837
Activities taken to Close a Project or Phase
Confirm all requirements are met.
Verify and document that project or phase meet exit criteria.
Obtain formal (legal) sign-off from customer.
Prepare final payments & cost reports.
Update records.
Finish lessons learned.
Ahmad Maharma PMBOK 5th Edition 838
Activities taken to Close a Projector Phase (Cont’d)
Update procedures and templates based on lessons learned.
Analyze and document project success and effectiveness.
Prepare final report.
Index & archive records.
Measure customer satisfaction.
Hand off completed project deliverables to user(s)
Release resources
Ahmad Maharma PMBOK 5th Edition 839
Final Report The final report is a report that summarizes what happened
in the project .
It is prepared for all projects , irrespective of weather the project has been completed successfully or not.
Includes:
Overview of the project.
Evaluation of the team's performance.
List of issues encountered.
A summary of what went right and what wrong.
Deviations from the original plan and budget.
Summary of major accomplishments.
Recommendations for future projects.
Is made available to the senior management, stakeholders, and other project managers.
Ahmad Maharma PMBOK 5th Edition 840
How to Create a Final Report
Make a summary of how the project was carried out.
Evaluate the performance of the project team.
Explain the issues encountered.
Provide recommendations for future projects.
Example: A project to create a website for a client.
The final report includes:
An overview of the project's initial objectives and specification.
Key changes to the objectives.
Recommendations for similar projects.
Ahmad Maharma PMBOK 5th Edition 841
Project Management Professional
PMP®
Phase #5: PROJECT CLOSING
Chapter 4: Integration/ 4.5 Close Project or Phase
Close Project or Phase
Expert Judgment
Analytical Techniques
Meetings
Final product, service, or result
Organizational process assets updates
Project management plan
Accepted deliverables
Organizational process assets
Ahmad Maharma PMBOK 5th Edition 843
Close procurements
The process of completing each project procurement.
It supports the “Close Project or Phase” process, since it involves verification that all work and deliverables were acceptable.
Ahmad Maharma PMBOK 5th Edition 844
Close procurements
For all procurements and contracts.
Happens when:
A contract ends.
A contract is terminated before work completion.
All contracts must be closed, no matter what.
Closing a contract provides a formal written verification that work and deliverables were accepted.
Ahmad Maharma PMBOK 5th Edition 845
Close Procurement Vs. Close a Project or Phase
Closing procurement occurs first.
Closing a project or phase maybe done at the end of project or phase, while closing a procurement happens at the end of the contract.
Closing contracts require more record keeping due to legal implications.
Ahmad Maharma PMBOK 5th Edition 846
Close Project or Phase
Close Procurements
Close ProjectOr Phase
Integration Procurement
Ahmad Maharma PMBOK 5th Edition 847
Contract Terminations
Contracts are terminated usually by buyers due to:
Cause (seller doesn’t perform)
Convenience (work no more needed)
Contracts should have provisions for stopping work before completion.
Rights and responsibilities of parties in early termination are contained in a termination clause in the contract
Ahmad Maharma PMBOK 5th Edition 848
Project Management Professional
PMP®
Phase #5: PROJECT CLOSING
Chapter 12: Procurement / 12.4 Close Procurement
Close Procurements
Procurement Audits.
Procurement Negotiations
Records Management System
Closed Procurements
Organizational process assets updates
Project management plan
Procurement Document
Ahmad Maharma PMBOK 5th Edition 850
Activities taken to Close a Procurement
Verify Product.
Close financial records.
Update records.
Prepare final contract performance report.
Close contract file.
Perform procurement audit.
Finalize lessons learned.
Final acceptance and closure.
Ahmad Maharma PMBOK 5th Edition 851
Contents of Contract File
Contract.
Change requests.
Seller performance reports.
Financial information.
Inspection (audit) results.
Lessons learned.
Ahmad Maharma PMBOK 5th Edition 852
PMBOK Reading
Chapter 4
Section 4.6
Chapter 12
Section 12.4
Ahmad Maharma PMBOK 5th Edition 853
Project Management Professional
PMP®
PROFESSIONAL RESPONSIBILITY
Code of Ethics and Professional Conduct
Describes the expectations that we have of ourselves and our fellow practitioners in the global project management community
It articulates the ideals to which we aspire as well as the behaviors that are mandatory in our professional and volunteer roles
Ahmad Maharma PMBOK 5th Edition 855
Purpose & Target Group
Purpose
Instil confidence in the project management profession
Help individuals become better practitioners
Target Group
All PMI members
All PMI credential holders
Individuals in the process of application for PMI credentials
PMI volunteers
Ahmad Maharma PMBOK 5th Edition 856
Structure
4 Values
Responsibility
Respect
Fairness
Honesty
Each value has:
Mandatory Conduct
Aspirational Conduct
Ahmad Maharma PMBOK 5th Edition 857
Mandatory Vs. AspirationalConduct
Mandatory
Establish firm requirements, and in some cases, limit or prohibit practitioner behavior.
Aspirational
Describe the conduct that we strive to uphold as practitioners
Although adherence to the aspirational standards is not easily measured, conducting ourselves in accordance with it is not optional
The conduct covered under the aspirational standards and conduct covered under the mandatory standards are not mutually exclusive
Ahmad Maharma PMBOK 5th Edition 858
Responsibility
Definition
Our duty to take ownership for the decisions we make or fail to make, the actions we take or fail to take, and the consequences that result.
Ahmad Maharma PMBOK 5th Edition 859
Responsibility-AspirationalStandards
We make decisions and take actions based on the best interests of society, public safety, and the environment
We accept only those assignments that are consistent with our background, experience, skills, and qualifications
We fulfill the commitments that we undertake – we do what we say we will do.
When we make errors or omissions, we take ownership and make corrections promptly.
When we discover errors or omissions caused by others, we communicate them to the appropriate body as soon they are discovered.
We protect proprietary or confidential information that has been entrusted to us
Ahmad Maharma PMBOK 5th Edition 860
Responsibility – Mandatory Responsibility
We report unethical or illegal conduct to appropriate management and, if necessary, to those affected by the conduct.
We report unethical or illegal conduct to appropriate management and, if necessary, to those affected by the conduct.
We bring violations of this Code to the attention of the appropriate body for resolution
We only file ethics complaints when they are substantiated by facts.
We pursue disciplinary action against an individual who retaliates against a person raising ethics concerns.
Ahmad Maharma PMBOK 5th Edition 861
Respect
Description
Our duty to show a high regard for ourselves, others, and the resources entrusted to us
Ahmad Maharma PMBOK 5th Edition 862
Respect- Aspiriational Standard
We inform ourselves about the norms and customs of others and avoid engaging in behaviors they might consider disrespectful.
We listen to others’ points of view, seeking to understand them.
We approach directly those persons with whom we have a conflict or disagreement.
We conduct ourselves in a professional manner, even when it is not reciprocated.
Ahmad Maharma PMBOK 5th Edition 863
Respect – Mandatory Standard
We negotiate in good faith.
We do not exercise the power of our expertise or position to influence the decisions or actions of others in order to benefit personally at their expense.
We do not act in an abusive manner toward others.
We respect the property rights of others.
Ahmad Maharma PMBOK 5th Edition 864
Fairness
Description
Our duty to make decisions and act impartially and objectively. Our conduct must be free from competing self interest, prejudice, and favoritism.
Ahmad Maharma PMBOK 5th Edition 865
Fairness- AspirationalResponsibility
We demonstrate transparency in our decision-making process.
We constantly reexamine our impartiality and objectivity, taking corrective action as appropriate.
We provide equal access to information to those who are authorized to have that information.
We make opportunities equally available to qualified candidates
Ahmad Maharma PMBOK 5th Edition 866
Fairness – Mandatory Responsibility
We proactively and fully disclose any real or potential conflicts of interest to the appropriate stakeholders.
When we realize that we have a real or potential conflict of interest, we refrain from engaging in the decision-making process or otherwise attempting to influence outcomes
We do not hire or fire, reward or punish, or award or deny contracts based on personal considerations, including but not limited to, favoritism, nepotism, or bribery.
We do not discriminate against others based on, but not limited to, gender, race, age, religion, disability, nationality, or sexual orientation.
Ahmad Maharma PMBOK 5th Edition 867
Honesty
Description
Our duty to understand the truth and act in a truthful manner both in our communications and in our conduct.
Ahmad Maharma PMBOK 5th Edition 868
Honesty – AspirationalResponsibility
We earnestly seek to understand the truth.
We are truthful in our communications and in our conduct.
We provide accurate information in a timely manner.
We make commitments and promises, implied or explicit, in good faith.
We strive to create an environment in which others feel safe to tell the truth.
Ahmad Maharma PMBOK 5th Edition 869
Honesty – Mandatory Standard
We do not engage in or condone behaviour that is designed to deceive others, including but not limited to:
Making misleading or false statements
Stating half-truths,
Providing information out of context, or
withholding information that, if known, would render our statements as misleading or incomplete.
We do not engage in dishonest behaviour with the intention of personal gain or at the expense of another
Ahmad Maharma PMBOK 5th Edition 870
Project Management Professional
PMP®
EXAM PREPERATION
GETTING STARTED
The Certificates
About the exam
Applying to take the exam
Preparing for the exam
How does the exam look like
Taking the exam
Take a sample exam
Ahmad Maharma PMBOK 5th Edition 872
THE CERTIFICATES
There are a number of project management certificates, taking this course qualifies you to take one of the following certificates:
Project Management Professional – PMP®
Certified Associate in Project Management – CAPM®
Ahmad Maharma PMBOK 5th Edition 873
THE CERTIFICATES
Code of
Conduct
Time of
ExamQuestions
PM
Experience
PM
TrainingEducationCertificate
Yes3 hours150None 25 hoursBachelor
Degree CAPM
Yes 4 hours 200
4500 hour
(3 years) 35 hours
Bachelor
Degree PMP
Ahmad Maharma PMBOK 5th Edition 874
ABOUT THE EXAM
% of Questions# of QuestionsPMI Process
13%26Initiation
24%48Planning
30%60Execution
25%50Control
8%16Closing
Ahmad Maharma PMBOK 5th Edition 875
ABOUT THE EXAMS
PMI exams require certain procedures to qualify for taking the exam – eligibility
Eligibility letters can be acquired online.
The exam measures the following:
Project Management knowledge
Practical experience
Common sense
Ethics & principles
Ahmad Maharma PMBOK 5th Edition 876
Applying for the Exam
Apply for the Eligibility Online
Visit PMI’s website
https://certification.pmi.org/
Log in using username and password
You have 3 months to complete the process
Fill all the required information:
Address
Education
Experience
Details of completed projects
Contact Information for Managers and Supervisors
Project management education
Ahmad Maharma PMBOK 5th Edition 877
Applying for The Exam
In the experience section: fill in all the information about your project management related experience.
Project Title
Role in project
Primary Industry
Time spent on the project
Summary of tasks
Only Project-related work counts, operational work is not considered part of the required experience.
Ahmad Maharma PMBOK 5th Edition 878
Contact Prometric® Center to schedule for the exam.
Specify a time, date, and exam center
Make sure you know where the exam center is ahead of time, visit before the day of the exam
Applying for The Exam
Ahmad Maharma PMBOK 5th Edition 879
Application Rules A new and improved online application.
Collection of project contact information.
Instant audit notification.
One-year eligibility period.
Limit on the number of times candidates will be permitted to test. Candidates will have three opportunities to take and pass the PMP® examination within their one-year eligibility period. If candidates do not succeed on the third attempt, candidates will have to wait one year from their third unsuccessful attempt before being permitted to test again.
Ahmad Maharma PMBOK 5th Edition 880
Few Tips
The exam measures the capability of using knowledge and experience in real life, therefore most of the questions are situational
Only few questions require that you MEMORIZE the inputs, outputs, tools and techniques.
Don’t waste your time trying to memorize inputs, outputs, tools and techniques. It’ll do you no good.
Time of the exam is enough, no one ever complained about time.
You might use the same data for more than one question
Ahmad Maharma PMBOK 5th Edition 881
Expect 18-22 formula based questions (CPM, EVM and others)
The length of the question does not indicate that it’s a difficult one. And the length of the answer does not necessarily indicate that it’s the right one.
Many questions have more than one right answer, you have to choose the BEST.
A right statement does not make it the right answer to the question.
The questions jump from one topic to another without a specific sequence.
Few Tips
Ahmad Maharma PMBOK 5th Edition 882
TYPES OF QUESTIONS
Situational questions
You received Notification that a major item you are purchasing for a project will be delayed, what is the BEST Thing to do?
Ignore it, it will go away
Notify your boss
Let the customer know about it and talk over options
Meet with the team to identify alternatives.
Ahmad Maharma PMBOK 5th Edition 883
TYPES OF QUESTIONS
Two or more right answers
Extraneous information
Questions using made up terms
Where understanding is important
New approach to known topic
Questions with more than one item in each choice
Excessively wordy questions
Ahmad Maharma PMBOK 5th Edition 884
Extraneous information
Your company is a major manufacturer of doors, and has received numerous awards for quality. As the head of manufacturing department, you have 230 people reporting to you on 23 different projects. Experience shows that each time you double the production of doors, unit costs decrease by 10 percent. Based on this, the company determines that production of 3,000 doors costs $ 21,000. This case illustrates:
Learning cycle
Law of diminishing return
80/20 rule
Parametric estimating
Ahmad Maharma PMBOK 5th Edition 885
Questions Using Made Up Terms
A form of project organization where power is evenly shared between the functional manager and the project manager is called:
A tight matrix
A weak matrix
A balanced matrix
A strong matrix
Ahmad Maharma PMBOK 5th Edition 886
Where Understanding is Important
The process of decomposing deliverables into smaller, more manageable components is complete when:
Project justification has been established
Change requests have occurred
Cost and duration estimates can be developed for each work element at this detail
Each work element can be found in the WBS Dictionary
Ahmad Maharma PMBOK 5th Edition 887
New approach to know topic
In a matrix organization, information dissemination is MOST likely to be effective when:
Information flows both horizontally and vertically
The communications flows are kept simple
There is an inherent logic in the type of matrix shown
Project managers and functional managers socialize
Ahmad Maharma PMBOK 5th Edition 888
Questions with more than one item in each choice
The seller on the project has presented the project manager with a formal notification that the seller has been damaged by the buyers activities. The seller claims that the buyer’s slow response to sending the seller approvals has delayed the project, and has caused the seller unexpected expense. The FIRST things the project manager should do are:
Collect all relevant data, send the data to the company lawyer, and consult with him about legal actions
Review the contract for specific agreed-upon terms that relate to the issue, see if there is a clear response, and consult with the lawyer if needed
Review the statement of work for requirements, send a receipt of claim response, and meet to resolve the issue without resorting to legal actions if possible
Hold a meeting with the team to review why the acceptances have been late, make a list of the specific reasons, and resolve those reasons
Ahmad Maharma PMBOK 5th Edition 889
STUDYING FOR THE EXAM
Reading the material
Reviewing PMBOK® - Project Management Body of Knowledge
Processes in each knowledge area
Inputs, tools & techniques, outputs of processes
Review code of professional conduct
Solve a lot of practice questions
Ahmad Maharma PMBOK 5th Edition 890
STUDYING FOR THE EXAM
Rule of Threes
Test-taking mode
Step-by-step
Take a comprehensive exam
Go back to the areas you scored less in, and study them in concentration
Review other areas
Review answers
Retake the entire exam
Ahmad Maharma PMBOK 5th Edition 891
BEFORE THE EXAM
Review material
Eat a good meal, see some TV, go out with friends
Get a good night sleep (don’t study material, don’t stay up all night)
Take the day of the exam off work (or at least the morning)
Eat a good meal, drink some coffee, juice.
Ahmad Maharma PMBOK 5th Edition 892
THE DAY OF THE EXAM
Schedule the exam between 9-10
Wear comfortable cloths, shoes
Leave the house at least 45 minutes before the exam starts
Take two Identification cards and the eligibility letter
No calculator, no cell phone, no review notes, no smoking
Take a snack (they might allow it)
Ahmad Maharma PMBOK 5th Edition 893
DURING THE EXAM
Watch the time regularly
Skip questions you can’t answer instantly
Use “Mark” function
At the middle mark of the exam, stand up, and do some exercise
Use your time wisely
Control your frustration
Ahmad Maharma PMBOK 5th Edition 894
Ahmad Maharma 895PMBOK 5th Edition
For more information do not hesitate to contact me.
Ahmad H. Maharma
Master Of Engineering Management
PMP®,RMP®
Ramallah, Palestine
E-Mail: [email protected]
www.linkedin.com/in/ahmadmaharma/
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