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1. When you st down to take exam at a computer testng center, you be gven scratch paper.

You aso have 15 mnutes to go through a tutora that shows you how use the exam system.
Before you nsh the tutora, take a mnute and wrte down a of the formuas. Wrte down the earned value formulas and the formula to calculate the lines of communication on the scratch paper.
That w make any cacuaton queston easy.
2. Books / reference material
* PMBOK_4th_Edton.pdf
* http://www.pmroadtrp.com/readonnev4.htm -- very good examples, helps understanding concepts from PMBOK
* Head Frst PMP 2nd Edton (2009).pdf
* Km Hedman.PMP.5th.Edton.|un.2009.pdf -- Excellent sample PMP tests
* Rta 6 Edton PMP Exam PREP.pdf -- MU! read "t#ice or more$
3. The PMP exam s a 4-hour mutpe choce exam. In these 4 hours, you are gong to have to answer 200 questons. Each queston s ether scenaro based or knowedge based and has 4 possbe answers - A, B, C or D.
You can ony seect one answer. Out of these 200 questons, 25 are consdered "pretest questions". These pretest questons do not ahect your score. The PMI uses them as an ehectve and egtmate way for testng the questons.
In other words: new questons for the exam are rst tred out n ths way, to see how we they work. The pretest questons are randomy paced throughout the exam.
So you start out wth 200 questons mnus the 25 pretest questons whch eaves 175 questons. Out of these, you must answer %&' correctly , that is '%(.
4. For Practice exam online, try the free:
* Head Frst PMP onne exam smuator: http://www.headrstabs.com/PMP/free_exam/
* Free exam: http://www.overehmann.com/contents/free-downoads/175_PMP_Sampe_Ouestons.pdf
5. Exam Oueston dstrbuton:
Pro|ect Intaton %%(
Pro|ect Pannng )*(
Pro|ect Executon )+(
Pro|ect Montorng and Contro )%(
Pro|ect Cosure ,(
Code of conduct ,(
1. When you st down to take exam at a computer testng center, you be gven scratch paper. You aso have 15 mnutes to go through a tutora that shows you how use the exam system.
Before you nsh the tutora, take a mnute and wrte down a of the formuas. Wrte down the earned value formulas and the formula to calculate the lines of communication on the scratch paper.
That w make any cacuaton queston easy.
http://www.pmroadtrp.com/readonnev4.htm -- very good examples, helps understanding concepts from PMBOK
* Head Frst PMP 2nd Edton (2009).pdf
* Km Hedman.PMP.5th.Edton.|un.2009.pdf -- Excellent sample PMP tests
MU! read "t#ice or more$
3. The PMP exam s a 4-hour mutpe choce exam. In these 4 hours, you are gong to have to answer 200 questons. Each queston s ether scenaro based or knowedge based and has 4 possbe answers - A, B, C or D.
You can ony seect one answer. Out of these 200 questons, 25 are consdered "pretest questions". These pretest questons do not ahect your score. The PMI uses them as an ehectve and egtmate way for testng the questons.
In other words: new questons for the exam are rst tred out n ths way, to see how we they work. The pretest questons are randomy paced throughout the exam.
So you start out wth 200 questons mnus the 25 pretest questons whch eaves 175 questons. Out of these, you must answer %&' correctly , that is '%(.
* Head Frst PMP onne exam smuator: http://www.headrstabs.com/PMP/free_exam/
http://www.overehmann.com/contents/free-downoads/175_PMP_Sampe_Ouestons.pdf
)%(
1. When you st down to take exam at a computer testng center, you be gven scratch paper. You aso have 15 mnutes to go through a tutora that shows you how use the exam system.
formula to calculate the lines of communication on the scratch paper.
3. The PMP exam s a 4-hour mutpe choce exam. In these 4 hours, you are gong to have to answer 200 questons. Each queston s ether scenaro based or knowedge based and has 4 possbe answers - A, B, C or D.
. The PMI uses them as an ehectve and egtmate way for testng the questons.
In other words: new questons for the exam are rst tred out n ths way, to see how we they work. The pretest questons are randomy paced throughout the exam.
that is '%(.
Enterpise Environmental -actors:
People: The sks and organzatona cuture where you work.
.isk !olerance: Some companes are hghy toerant of rsk and some are reay rsk averse.
Market: The way your company s performng n the market can ahect the way you manage your pro|ect.
/ata0ases: Where your company stores ts data can make a bg dherence n the decsons you make on your pro|ect.
tandards: Some companes depend on government standards to run ther busness and when they change, t can have a bg mpact
Organisational culture, infrastructure,
PM1 (an automated too, a cong mgmt system...)
/eal #ith pro2ect constraints: Sometmes there w be constrants on the pro|ect that you need to dea wth. You mght start a pro|ect and be tod that
t cant cost more than $200,000. Or t absoutey MUST be done by the trade show n May. Or you can ony do t f you can get one specc programmer to
do the work. Or theres a good chance that a compettor w beat you to t f you dont pan t we. Its constrants ke that that make the |ob more
chaengng, but ts a n days work for a pro|ect manager.
In a -U34!1O356 Organi7ation, the teams workng on the pro|ect dont report drecty to the PM. Instead, the teams are n departments, and the pro|ect
manager needs to "borrow" them for the pro|ect. Pro|ect team members aways report to a functona manager.
In P.O8E4!19E/ Organi7ation, the team reports to the pro|ect manager, who has a ot more authorty.
-- Teams are organzed around pro|ects. When a pro|ect s done, the team s reeased, and the team members move to another pro|ect.
-- The pro|ect manager makes a of the decsons about a pro|ects budget, schedue, quaty, and resources.
-- The PM s responsbe for the success or faure of ther pro|ect.
:E5K M5!.1;:
-- PMs have some authorty but they arent n charge of the resources on a pro|ect.
-- Ma|or decsons st need to be made wth the functona managers cooperaton or approva.
B56534E/ M5!.1;: Foks who work n a baanced matrx organzaton report to a PM AND a functona manager equay.
!.O3< M5!.1;: Pro|ect managers have more authorty than functona managers, but the team st reports to both managers.
Exam !ip: If a queston on the exam doesnt state an organzaton type, assume ts referrng to a matrx organzaton. That means the PM s responsbe
for makng budgets, assgnng tasks to resources, and resovng concts.
-- 4osts and sta=ng levels are lo#est early in the life cycle, peak whe the pro|ect work s underway, and then drop oh as the pro|ect nears
competon.
-- .isk is highest early in the pro2ect snce uncertanty s hgh about the pro|ects deverabes, resource needs, and work requred. and a ths
uncertanty means that a pro|ect s most key to fa eary n ts fe cyce.
-- takeholder in>uence in the pro2ect and its delivera0les is highest early in the life cycle but dmnshes as the pro|ect proceeds because the
cost of incorporating changes increases the further the pro|ect s nto ts fe cyce. So one way of controng unexpected pro|ect cost s to engage
stakehoders eary to prevent unnecessary and costy changes ater n the pro|ect.
Pay0ack Period:
The payback perod tes us how ong t w take to recoup the expense of the pro|ect, so a shorter payback perod s better. Its often used n con|uncton
wth other sophstcated formuas, but at ts smpest, the payback perod s cacuated usng the pro|ect costs pus any ongong costs as a resut of the
pro|ect compared to any savngs or ncrease n prots the pro|ects product w provde.
For exampe, a pro|ect to repace an outmoded process s expected to cost $80,000 and requre $10,000 a year to mantan. But ts expected to resut n a
$50,000 annua savngs. The payback perod for ths pro|ect w be two years. When cacuatng a payback perod, keep n mnd how ong the pro|ect w
take. In the exampe beow, f the pro|ect requres one year to be competed, the payback perod woud be three years nstead of two.
Opportunity 4ost:
Opportunty cost s the monetary vaue that s forgone when one acton s chosen over another. For us, t smpy reects what money s "ost" by choosng
one pro|ect over another, and ts the entre vaue of the opportunty not chosen. For exampe, f pro|ect A was vaued at $50,000 and pro|ect B was vaued
at $80,000:
Choosng pro|ect A resuts n a ost opportunty cost of $80,000 (the entre vaue of pro|ect B)
Choosng pro|ect B resuts n a ost opportunty cost of $50,000 (the entre vaue of pro|ect A)
Portfolio: A portfoo s a group of pro|ects or programs that are nked together by a busness goa.
Program: A program s a group of pro|ects that are cosey nked, to the pont where managng them together provdes some benet.
Pro2ect? A pro|ect s any work that produces a specc resut and s temporary. Pro|ects aways have a begnnng and an end. But they are never
ongong.
Operations: are ongong. If youre budng cars on an assemby ne, thats a process. If youre desgnng and budng a prototype of a specc car
mode, thats a pro|ect.
A pro|ect may or may not be part of a program, but a program w aways have pro|ects.
Portfoos are organzed around busness goas and Programs are organzed around a shared benet n managng them together.
takeholder: Anyone who w be ahected by the outcome of your pro|ect s a stakehoder.
- sponsor whos payng for the pro|ect
- the team whos budng t
- peope n management who gave the pro|ect the green ght are a good exampes.
4onstraints: Cost, Tme, Scope, Ouaty, Rsk, and Resources
@s. A pro|ect coordnator s havng troube securng programmers for her pro|ect. Every tme she asks her boss to gve a resource to the pro|ect he says
that they are too busy to hep out wth her pro|ect. Whch type of organzaton s she workng n?
5ns: Snce the pro|ect manager has to ask permsson from the functona manager and cant overrue hm, shes workng n a functona organzaton.
@s. A pro|ect manager s havng troube securng programmers for her pro|ect. Every tme she asks the programmng manager for resources for her
pro|ect, he says theyre a assgned to other work. So she s constanty havng to go over hs head to overrue hm. Whch type of organzaton s she
workng for?
5ns: The Pro|ect Manager n ths scenaro can overrue the functona manager, so shes workng n a Strong Matrx organzaton. If t were a pro|ectzed
organzaton, she woudnt have to get permsson from the functona manager at a because shed be the person wth authorty to assgn resources to
pro|ects.
BeneAt/4ost .atio -ormulas:
Benet/cost formuas are used by neary every organzaton to assst n makng pro|ect seecton decsons. Beow s an overvew of common formuas.
.eturn on 1nvestment ".O1$: ROI s attractve for ts smpcty, but t doesnt reect the tme vaue of money or protabty. A arger ROI s the better
choce.
ROI = (Benet - Cost)/Cost
Exampe: The ROI of a pro|ect that w cost $100,000 but resut n a $250,000 benet or ncrease n prots s 1.5.
ROI=(250,000-100,000)/100,000
ROI=150,000/100,000
ROI=1.5
-uture Balue "-B$: We a know that $1 today w not have the same purchasng power n the future, so the future vaue formua accounts for ths tme
vaue of money. It uses the nterest rate and the number of perods to cacuate what the future vaue of money w be. A hgher future vaue s
preferred. Usng future vaue, f the nterest rate s 5 percent, $1 today w be worth $1.05 next year.
FV = Current Vaue x (1 + I)n where I s the nterest rate and n s the number of perods.
Exampe: The future vaue of $100,000 n two years at an average nterest rate of 5% s $110,250.
FV = 100,000 x (1 + .05)2
FV=100,000 x (1.05)2
FV=100,000 x 1.1025
FV=110,250
Present Balue "PB$: If a pro|ect w return $1 next year, what s that doar worth n todays vaue? The present vaue formua s the nverse of the
future vaue formua, and t converts future money to reect what ts present vaue s by usng the nterest rate.
PV = Future Vaue / (1 + I)n where I s the nterest rate and n s the number of perods.
Exampe: The present vaue of $125,000 earned ve years from now at an average nterest rate of 7% s worth ony $89,123.38 today.
PV=125,000 / (1 + .07)5
PV=125,000 / (1.07)5
PV=125,000 / 1.40255
PV=89,123.38
Pro2ect Mgt -rame#ork
/eAnition of Pro2ect: A pro|ect:
- s a teporary endeavour wth a begnnng and an end.
- creates a unque product, servce or resut.
Operational :ork: s ongong work and repettve
Program? s a group of related Pro2ects.
Portfolio? s a group of programs to acheve a specc strategc 0usiness goal.
O02ectives:
-pro|ect ob|ectves are contaned n the pro|ect charter
-projects are considered complete when objectives are met.
Management 0y O02ectives "MBO$:
-estabsh unambguous and reastc ob|ectves
-perodcay observe f ob|ectuves are beng met
-mpement correctve actons
4onstraints: Cost, Tme, Scope, Ouaty, Resources, Rsk, Customer satsfacton
:hy do pro2ects end?
-when they meet ther ob|ectves
-an aso end prematurey when t becomes cear that the ob|ectves cant be met
-need for the pro|ect no onger exsts.
--Pro2ect scope: work, and ony the work requred to produce the pro|ects deverabes.
--Product scope: descrbes the characterstcs and functonaty of the product, servce, or resut.
--4osts and sta=ng eves are 6O:E! eary n the fe cyce, peak whe the pro|ect work s underway, and then drop oh as the pro|ect nears competon.
--.isk is highest early in the pro2ect snce uncertanty s hgh about the pro|ects deverabes, resource needs, and work requred.
--takeholder in>uence in the pro2ect and its delivera0les is highest early in the life cycle but dmnshes as the pro|ect proceeds because the cost of
incorporating changes increases the further the pro|ect s nto ts fe cyce.
--Programs are coectons of ndvdua pro|ects that support a central o02ective
CCPortfolios are organzed around business goals and Programs are organzed around a shared beneft n managng them together.
--PMO? may hep provde resources, termnate pro|ects, hep gather essons earned, be part of Change Cntr Board,...etc
--Kno#ledge, performance, and personal skills are the three areas that pro|ect managers focus on to get better at ther |obs.
Organisational tructure?
-unctional: org s grouped by areas of specazaton wthn dherent functona areas. 5uthority is #ith functional managers.
Pro2ecti7ed: entre company s organsed by pro|ects. !he PM has control of pro2ects. Perssona are assnged and report to a PM. Team members ony compete the pro|ect work and when the pro|ect s over, they do not have a department to go back to.
Matrix: Team member reports to t#o 0osses, the PM and the -unctional Mgr. Share responsbty and authorty between the two. As compared to functona org, there woud be mproved Pro| Mgr contro over the resources and better horzonta & vertca dssemnaton of nformaton.
In !.O3< Matrix - power rests wth Pro2ect Mgr. Pro|ect managers have more authorty than functona managers, but the team st reports to both managers.
In B56534E/ Matrix - Pro|ect managers share authorty wth the functona managers.
In :E5K Matrix - power rests wth -unctional Mgr and power of Pro|ect Mgr s comparabe to that of a coordinator or expediter. PMs have some authorty but they arent n charge of the resources on a pro|ect.
A pro2ect expediter s somebody who keeps track of status but has no decson-makng authorty on a pro|ect at a. |ust keeps everybody nformed of pro|ects progress.
A pro2ect coordinator s someone who does pretty much the same thng, but does get to make some of the minor decisions on the project without having to run them by the functional manager. Coordnators usuay report to somebody who s pretty hgh up n the organzaton, whe expedters are
more ke assstants to the functona manager.
------------- Youre key to nd pro2ect expediters n functional organi7ations.
------------- Pro2ect coordinators and expediters dont exst n a pro2ecti7ed organi7ation.
When youre takng the PMP exam, f you see a queston that mentons a PM, then you shoud assume that the queston s askng about a matrix organi7ation f t doesnt say up front whch knd of organzaton s beng descrbed. Functona organzatons are usuay panted n a negatve ght
because they tend to gve ess authorty to pro|ect managers.
If a queston on the E;5M doesnt state an organzaton type, assume its referring to a Matrix organization. That means the PM is responsible for making budgets, assigning tasks to resources, and resolving conficts.
Product 6ife 4ycle: 4O34EP!1O3, <.O:!D, M5!U.1!E, /E4613E, :1!D/.5:56. A Product can spawn across many pro|ects over ts fe.
Pro2ect 6ife 4ycle: Feasbty, Pannng, Desgn, Codng, testng, nstaaton, converson, turnover to operatons.
PM1 4ode of Ethics and Professional 4onduct
PMI Code of Ethcs and Professona Conduct
Ethcs and professona responsbty questons make up ,( of the exam. Thats good news because these questons are reay easy f you understand the deas behnd the PMP Code of Professona Conduct.
Bri0es arent aways cash. They can be anythng rangng from free trps to tckets to a ba game. Any tme youre ohered anythng to change your opnon or the way you work, you must decne the oher and dscose t to your company.
-ly 0usiness class? Even f t seems ke no harm w be done f you dont foow the pocy, and even f you w be abe to get away wth t, you shoud not do t. And that goes doube for aws-under no crcumstances are you ever aowed to break a aw, no matter how much good t "seems" to do you
or your pro|ect.
3e# soft#are When t comes to copyrght, ts never OK to use anythng wthout permsson. Books, artces, musc, software... you aways need to ask before usng t. For exampe, f you want to use some copyrghted musc n a company presentaton, you shoud wrte to the copyrght owner and ask
for permsson.
hortcuts You mght see a queston or two that asks f you reay need to foow a of the processes. Or you mght be asked by your boss to keep certan facts about your pro|ect hdden from stakehoders or sponsors. You have a responsbty to make sure your pro|ects are run propery, and to never
wthhod nformaton from peope who need t.
Beng responsbe to the community s even more mportant than runnng a successfu pro|ect. But ts more than beng envronmentay aware-you shoud aso respect the cutures of everyone ese n your communty, and the communty where your pro|ect work w be done.
The PMI Code of Ethcs and Professona Conduct outnes four areas of responsbty:
%C .esponsi0ility CC ownershp of decsons and actons
)C .espect CC treatment of peope and resources
*C -airness CC ob|ectve and mparta decson
FC Donesty CC truth-based actons
.esponsi0ility: Responsbty s the act of makng decsons that are for the good of the organzaton rather than ourseves, admttng our mstakes, beng responsbe for the decsons we make and the consequences that resut, aong wth other actons.
-- Ensuring 1ntegrity: As a pro|ect manager, one of your professona responsbtes s to ensure ntegrty of the pro|ect management process, the product, and your own persona conduct. Correcty appyng the pro|ect management processes youve earned w ensure the ntegrty of the product.
-- 5ccepting 5ssignments: You shoud not knowngy accept assgnments that are beyond your capabtes or experence.
-- 6a#s and .egulations 4ompliance: Ths mght seem obvous, but as a professona, youre requred to foow a appcabe aws and rues and reguatons that appy to your ndustry, organzaton, or pro|ect. Ths
ncudes PMI organzatona rues and poces as we.
-- 4onAdential 1nformation:
-- 4ompany /ata:
-- 1ntellectual Property:
.espect: Respect nvoves severa areas as we, ncudng the way we conduct ourseves, the way we treat others, stenng to other vewponts, conductng ourseves n a professona manner, and so on.
-- Professional /emeanor:
* Part of actng professonay nvoves controng yoursef and your reactons n questonabe stuatons. As a professona, your concern for the pro|ect and the organzaton shoud take precedence over your concern for your own feengs. Therefore, ashng out n return woud be unprofessona.
Mantan your professona demeanor, and dont succumb to shoutng matches or ego compettons wth others.
-- .eporting Ethics Biolations: As a PMP, one of the responsibilities that falls into this category is your responsibility to report violations of the PMP code of conduct !hen you know a violation has occurred and youve veri"ed the facts, notify PM# Part of this process$and a requirement of the code of
conduct$is that youll verify that an ethics violation has occurred %in other words, dont report bogus or unsubstantiated reports& and will assist PM# in the investigation by supplying information, con"rming facts and dates, and so on 'his includes anything listed as violations in the PMI Code of Ethics
and Professional Conduct, such as con(icts of interest, untruthful advertising, and false reporting of PMP e)perience and credentials, appearances of impropriety, and so on
-- 4ultural 5#areness: *!hen in +ome, do as the +omans do,-
-- 4ulture hock: !orking in a foreign country can bring about an e)perience called culture shock.ne of the ways you can avoid culture shock is to read about the country youre going to work in before getting there
-- /iversity !raining: /ometimes you might "nd yourself working with teams of people from di0erent countries or cultures /ome team members might be from one country and some from another 'he best way to ensure that cultural or ethical di0erences do not hinder your project is to provide
training for all team members 'eam1building activities are ways to build mutual trust and respect and bond team members with di0ering backgrounds
-- .especting Eour 3eigh0ors:
-- Perceiving Experiences:
-airness: Farness ncudes avodng favortsm and dscrmnaton aganst others, avodng and reportng conct of nterest stuatons, and mantanng mpartaty n our decson makng process.
-- 4on>ict of 1nterest: A conct of nterest s when you put your persona nterests above the nterests of the pro|ect or when you use your nuence to cause others to make decsons n your favor wthout regard for the pro|ect outcome. In other words, your persona nterests
take precedence over your professona obgatons, and you make decsons that aow you to personay benet regardess of the outcome of the pro|ect.
* Associations and Aliations: For exampe, perhaps your brother-n-aw owns hs own constructon company and you are the pro|ect manager who has |ust pubshed an RFP. Your brother-n-aw bds on the pro|ect and ends up wnnng the bd.
* !endor "ifts: Dont accept gfts that mght be construed as a conct of nterest. If your organzaton does not have a pocy regardng vendor gfts, set mts for yoursef dependng on the stuaton, the hstory of gft acceptance by the organzaton n the past, and the
compexty of the pro|ect. Its aways better to decne a gft youre unsure about than to accept t and ater ose your credbty, your reputaton, or your PMP status because of bad |udgment.
* #takeholder Infuence:
Donesty: Honesty can ncude a ot of topcs: reportng the truth regardng pro|ect status, beng honest about your own experence, not decevng others, not makng fase statements, and so on.
-- Personal <ain: Honesty nvoves not ony nformaton regardng your own background and experence, but nformaton regardng the pro|ect crcumstances as we.
-- !ruthful .eporting: As a pro|ect manager, you are responsbe for truthfuy reportng a nformaton n your possesson to stakehoders, customers, the pro|ect sponsor, and the pubc when requred. Aways be up front regardng the pro|ects progress.
-- .ole /elineation tudy: In addton to the areas covered n the PMI Code of Ethcs and Professona Conduct, you shoud be aware of four other focus areas that PMI dscusses n ts roe deneaton study. Ths study was pubshed n PMIs pubcaton Pro|ect Management Professona (PMP)
Examnaton Speccaton. The four focus areas are as foows:
* Ensure Persona Integrty and Professonasm
* Contrbute to the Pro|ect Management Knowedge Base
* Enhance Persona Professona Competence
* Promote Interacton Among Team Members & Other Stakehoders
5pplying Professional Kno#ledge? Professona knowedge nvoves the knowedge of pro|ect management practces as we as specc ndustry or technca knowedge requred to compete an assgnment. As a PMP, you shoud appy pro|ect management knowedge to a your pro|ects. Take the
opportunty to educate others by keepng them up-to-date on pro|ect management practces, tranng your team members to use the correct technques, nformng stakehoders of the correct processes, and then stckng to those processes throughout
the course of the pro|ect.
One way to appy professona knowedge s to become and reman knowedgeabe n pro|ect management best practces technques.
-- Pro2ect Management Kno#ledge:
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Understanding Do# Pro2ects 4ome 50out:
1. 3eeds and /emands: Market demand, Strategc opportunty/busness need, Customer request, Technoogca advance, Lega requrement, Soca need.etc
2. -easi0ility tudies: One s to determne whether the pro|ect s a vabe pro|ect. A second reason s to determne the probabty of the pro|ect succeedng.
3. electing and Prioriti7ing Pro2ects: Usng Pro|ect Seecton Methods: There are generay t#o categores of seecton methods: mathematical models (aso known
as cacuaton methods) and beneft measurement methods (aso known as decson modes).
* Mathematical models s that they use linear, dynamic, integer, nonlinear, and4or multi1objective programming n the form of agorthms-or n other words, a specc set of steps to
sove a partcuar probem. Mathematical models are aso known as Constrained optimi$ation methods
* BeneAt Measurement Methods? empoy varous forms of anayss and comparatve approaches to make pro|ect decsons. These methods ncude comparatve approaches such as
cost1bene"t analysis, scoring models, and bene"t contribution methods that ncude varous cash ow technques and economc modes.
-- coring Model or :eighted coring Model:
-- P5EB54K Period: The payback perod s the ength of tme t takes the company to recoup the nta costs of producng the product, servce, or resut of the pro|ect.
-- /14OU3!E/ 45D -6O:: FV = PV (1+r)
n,
, discounted cash (ow technque compares the vaue of the future cash ows of the pro|ect to todays doars. In order to cacuate
dscounted cash ows, you need to know the vaue of the nvestment n todays terms, or the PV. PV s cacuated as foows: PV = FV / (1 + )
n
.
3E! P.EE3! B56UE C 3PB: When you get a positive value for NPV, t means that the pro|ect w earn a return at east equa to or greater than the cost of capta.
13!E.356 .5!E O- .E!U.3 C 1..: s the dscount rate when the present value of the cash nows E@U56 the original investment. When choosng between pro|ects or when
choosng aternatve methods of dong the pro|ect, pro|ects wth hgher IRR vaues are generay consdered better than pro|ects wth ow IRR vaues.
Appy the PV formua to the pro|ects youre consderng, and then compare the dscounted cash ows of a the pro|ects aganst
each other to make a seecton. Here s an exampe comparson of two pro|ects usng ths technque:
Pro|ect A s expected to make $100,000 n two years.
Pro|ect B s expected to make $120,000 n three years.
If the cost of capta s 12 percent, whch pro|ect shoud you choose?
Usng the PV formua used prevousy, cacuate each pro|ects worth:
The PV of Pro|ect A = $79,719.
The PV of Pro|ect B = $85,414.
Pro|ect B s the pro|ect that w return the highest investment to the company and shoud be chosen over Pro|ect A.
Exam potlight
For the exam, you need to know three facts concernng 1..:
1. IRR s the dscount rate when NPV equas zero.
2. IRR assumes that cash nows are renvested at the IRR vaue.
3. You shoud choose pro|ects wth the hghest IRR vaue.
/evelop Pro2ect 4harter?
The process of deveopng a document that formay authorze a pro|ect or a phase and documentng nta requrements that satsfy the stakehoder's needs and expectatons.
The sponsor of a pro|ect s responsbe for creatng the pro|ect charter. The sponsor of a pro|ect pays for the pro|ect. The ntator's (sponsor) sgnature on the Charter authorzes the
pro|ect. The approved Pro|ect Charter formay ntates the pro|ect. The PM manages the pro|ect.
** Remember for the E;5M that the charter s authorzed by someone E;!E.356 to the pro|ect.
SOW: The essenta eements of the SOW are 1. WHAT s to be done (Product Scope Descrpton), 2. the busness REASON for dong t (Busness Need), and 3. HOW the pro|ect supports
the organzaton's strategy (Strategc Pan). And t s a wrtten descrpton of the pro|ect's product, servce, or resut. PMI cas a SOW for externa organzatons 'a contract statement of
work'. For Interna Pro|ects, the Pro|ect Intator or Sponsor provdes. For Externa Pro|ects, the Customer provdes as part of a bd document.
Pro|ect Seecton Methods:
1- BeneAt Measurement Methods "4omparative approach$: a. Economc Modes, b. Scorng Modes, c. Comparatve Approach, d. Benet Contrbuton, and e. Murder Board
2- 4onstrained Optimi7ation Methods "Mathematical$: a. Lnear programmng, b. Non-Lnear programmng, c. Dynamc, d. Integer, and e. Mut-ob|ectve agorthms
3. Addtona Methods: 1. BeneAt 4ost .atio (BCR), 2. Economic Balue 5dd (EVA) - If a pro|ect does not make more moeny than those opportunty costs, t has not truy added
economc vaue to the organzaton, 3. Interna Rate of Return (IRR) - Bgger s better, 4. Opportunty Cost - 'What s the cost of the other opportuntes we mssed by nvestng our money
n ths pro|ect?'. !he maller the opportunity cost, the 0etter. 4. Payback Perod - a horter pay0ack period is 0etter than a longer one., 5. Present Vaue (PV) and Net Present
Vaue (NPV): Bigger PB or 3PB makes a pro2ect more attractive., 6. Return on Investment ".O1$ C Bigger is 0etter., and 7. Retun on Invested Capta (ROIC) = Net Income (after
tax) from Pro|ect / Tota Capta Invested n the Pro|ect.
Pro2ect 4harter contains:
-Pro2ect /escription: Ths s a hgh-eve descrpton of the goas of your pro|ect. Its usuay a few sentences that descrbe the
pro|ects man purpose.
-Pro|ect Requrements "O:$:Anythng you know that the customer,stakehoder, or sponsor expects to getout of the pro|ect shoud
go here. Descrbes the product your pro|ect has to make.
-5ssigned Pro2ect Manager and 5uthority 6evel: Who the pro|ect manager s and what he has to do
-ummary Milestone chedule: (very hgh-eve schedue) A st of dates that your pro|ect needs to meet
-Business 4ase?Ths secton sts the reasons why t makes sense for your busness to do ths pro|ect.
-The ma|or stakeholders and ther nuences and pro|ect nterest.
-The measurabe success crtera for the pro|ect and #hoKll sign oL and measure those success ponts when the pro|ect s
competed.
-PC s signed by the performng organzaton's Senor Management.
Pro2ect election Methods:
1. Present value PV = Future Vaue -B / " % M r $
n
2. 3et Present value NPV = total benifts - costs over the period....generay f NPV s postve, then nvestment s good. The
pro|ect wth greatest NPV s seected.
@uestion: You have 2 pro|ects to seect from. Pro|ect A w take * years to compete and has NPV of $45,000. Pro|ect B w take '
years to compete and has NPV of $85,000. Whch one woud you prefer?
5ns#er: Pro2ect B, the tme perod s not reevant as woud have been taken care whe cacuatng NPV.
3. 1nternal .ate of .eturn IRR: The pro|ect wth greatest 1.. s seected.
4. Pay0ack Period: refers to number of tme perods t takes to recover your nvestments n the pro|ect before you start
accumuatng prot. The pro|ect wth lo#est pay0ack period s seected.
5. BeneAt cost ratio: A benet cost rato greater than 1 means benets are greater than costs. A benet cost rato ess than 1
means costs are greater than benets. A benet cost rato equa to 1 means costs and benets are same.
Oueston: f the BC rato of Pro| A s 2.3 and the BC rato of Pro| B s 1.7, whch pro| woud you seect?
Answer: A, the pro| wth higher 0eneAt cost ratio s seected.
6.Opportunity 4ost: ths refers to the opportunty gven up by seectng one pro|ect over another.
Oueston: You have 2 pro|ects to seect from. Pro|ect A has NPV of $45,000 and Pro|ect B has NPV of $85,000. What s the
opportunty cost of seectng pro|ect B?
Answer: $45,000
Exam @: What type of pro|ect seecton method s near programmng: => 4onstrained Optimi7ation Methods
/epreciation:
111111511111/traight 6ine depreciation
111111171111Accelerated 3epreciation
1111111111111117a11111113ouble declining balance
1111111111111117b1111111/um of the 8ears 3igit
1. Expert |udgment 1. Pro2ect 4harter "P4$
Business 4ase:
1 A 9usiness 2ase document says why its worth it to spend
money on the project
1 #t includes a narrative and bene"t4cost information
a Project 2harter is created based on some need, and it
should e)plain that need
e P2 should include a high1level milestone view of the project
schedule
Pro|ect Statement of Work (O:): A statement of work is a
written description of the project:s deliverable /.! should
contain; business need, scope, and how the proejct "ts into
the strategic plan
!hen the project is internal, this document is usually written
by either the pro%ect sponsor !hen the project is e)ternal
to the organization, the bu&er typically writes the /.!
b P2 is signed by the performing organization:s /enior
Management
f P2 is a high1level document that does not include project
details< the speci"cs of project activities
Enterprse Envronmenta Factors: .rganizational culture,
structure, and processes etc
Organzatona Process Assets: %for referring to lessons learned
from past&
d P2 should include the high1level proj requirements,
high1level Project 3escription, high1level +isks
g P2 includes a summary1level prelim project budget
h /how organizational, environmental and e)ternal
2.=/'+A#='/ and A//>MP'#.=/
/evelop Pro2ect Management Plan? The process of documentng the actons necessary to dene, prepare, ntegrate, and coordnate a subsdary pans. The Pro|ect Pan s ?a formal,
approved document that de"nes @.! the project is e)ecuted, monitored and controlled, and closed #t may be summary or detailed and may be composed of one or more subsidiary
management plans and other planning documents?. It woud be approved by * The Pro|ect Manager, * The Pro|ect Sponsor, * The Functona Manager who are provdng resources for the
pro|ect. (for the exam we w do much better to thnk of the Pro|ect Management Pan as aways beng DETAILED).
The pro|ect management pan s a snge document, but ts broken nto a bunch of peces caed subsdary pans. Theres one
subsdary pan for each of the other knowedge areas: scope management, tme management, cost management, quaty
management, human resource management, communcatons management, rsk management, and procurement management.
Pro2 Mgmt Plan contains scope, cost, schedule 0aselines. Scope basene s Pro% scope stmt ' ()# ' ()# *ictionar&
++ Together these basenes are caed Performance Measurement Baseline.
Exam? f the exam asks what to do when a pro|ect devates sgncanty from estabshed basenes, the correct answer s key the
one about revie#ing the pro2ects risk mgmt process. Devatons from basenes are often due to ncompete dentcaton of
rsks and rsk management.
* You may get a queston on the exam that asks what to do when you encounter a change.
* You aways begn deang wth change by consutng the pro|ect management pan.
* The work authorzaton system s a part of your companys Enterprse Envronmenta Factors, and ts generay part of any change
contro system.
* The pro|ect management pan ncudes basenes: snapshots of the scope, schedue, and budget that you can use to keep track of
them as they change.
1. Pro2ect 4harter 1. Pro2ect Management Plan
2. Outputs from Planning Processes %'he /2.PA mgmt plan, the /2@A3>6A mgmt plan, the 2./'
mgmt plan, the 2@A=BA mgmt plan, and the 2.=C#B>+A'#.=
mgmt plan are created right here&
Project /ponsor APP,-!E# the Proj Mgmt Plan
Confguration Mgmt #&stem; is part of the PM#/ #t contains
organisations standard con"g mgmt tools, processes and
procedures
/irect and Manage Pro2ect Execution? The Drect and Manage Executon Process s where you and your team actuay do the pro|ect work to produce the /elivera0les.
The process of perfomng the work dened n the pro|ect management pan to acheve the pro|ect's ob|ectves. It occurs any tme; we are foowng the pro|ect management pan to
create pro|ect deverabes. Most of the pro|ect resources and costs are expended n ths process.
* Drect and Manage Executon process has a bunch of nputs and outputs-but most of them have to do wth implementing changes, repairs, and corrective action
'he three components of the 3irect and Manage Project A)ecution process;
5 >se the plan to create deliverables
7 ,epair defects in deliverables
D As the project plan changes, make sure those changes are refected in the deliverables
Proj Mgmt tools used to ensure common understanding on a pro%ect; scope mgmt plan, !9/, !9/ 3ictionary,
1. Pro2ect Management Plan 1. /elivera0les
2. 5pproved 4hange .eHuests 2. :ork Performance 1nformation
8our job is to direct the work, but you need to do more than
deliver the results 8ou also need to keep track of how well
your team performed$and thats what the work performance
information output is about
%#t can include both manual and automated systems 3. 4hange .eHuests
Monitor and 4ontrol Pro2ect :ork? The process of tracking, revie#ing, and regulating the progress to meet the performance o02ectives deAned in the pro2ect
management plan. Any necessary changes n the work or the pan are dented and made n ths process.
# Md-Pro|ect Evauatons are conducted whe pro|ect work s st n progress. The man purpose of such evauatons s to determne f ob|ectves are st reevant and f these ob|ectves
are beng met. 6essons 6earned shoud aso be documented at ths tme nstead of watng for the pro|ect to be competed. A thrd party or peope outsde the team shoud be used to
conduct md-pro|ect evauatons.
-----------------------------------------------------Monitoring and 4ontroling means measuring against the pro2ect mgmt plan.--------------------------------------------
4hange .eHuests:
1.4orrective 5ctions: Documented drecton for executng the pro|ect work to brng expected future performance of the pro|ect work n ne wth the pro|ect management pan.
2.Preventive 5ctions: A documented drecton to perform an actvty that can reduce the probabty of negatve consequences assocated wth pro|ect rsks.
3./efect .epair: The formay documented dentcaton of defect n the pro|ect componenet wth a recommendaton to ether repar the defect or competey repace the component.
4.Updates: Changes to formay controed documentaton, pans, etc., to reect moded or addtona deas or content.
# Correctve and Preventve Actons do not normay ehect the Pro|ect Basenes, ony the performance aganst the basenes.
# Any nformaton (Schedue/Mestones/Cost/Ouaty/Etc) reated to the deverabes beng produced here coud be consdered Work Performance Informaton.
** The Monitor and 4ontrol Pro2ect :ork process s where you nd the changes that you may want to make.
Exam: f the exam asks what you shoud do f a work actvty on pro|ect takes onger than estmated, then answer s to take
corrective actions to make up for the deay.
The documented scope, schedue, and cost basenes are n the Pro|ect Management Pan are caed the Performance
Measurement BaselineN
Exam: stuatona O for exam, for exampe: a functona manager wants to make a change to the pro|ect, what s the rst thng a PM
shoud do?
5 evaluate the impact 1 considering all the project constraints
7 create options 1 are created based on crashing, fast tracking, reestimatingetc
D get change re.uest approved internall&
E get customer bu&+in %if required&
Exam: ####### /etailed Process of Making 4hanges:
5 Prevent the root cause for changes
7 #dentify change
D 6ook at impact of the change
E 2reate a change request
F Perform #netegrated 2hange 2ontrol
a evaluate the impact 1 considering all the project constraints
b create options 1 are created based on crashing, fast tracking, reestimatingetc
c get change request approved internally
d get customer buy1in %if required&
G Adjust the Proj Mgmt Plan, proj doc, baseline
H Communicate change to stakeholders
I Manage Project to the revised Proj mgmt Plan
1. Pro2ect Management Plan 1. 4hange .eHuests
2. Performance .eports
Perform 1ntegrated 4hange 4ontrol? The process of revewng a change requests, approvng changes, and managng changes to 1. the deverabes, 2. organzatona process
assets, 3. pro|ect documents, and 4. the pro|ect management pan. It brngs together (ntegrates) a of the other Montorng and Controng Processes. And t evauate the 1MP54! of a
change across the entre pro|ect. Changes may be requested by any stakehoder nvoved wth the pro|ect.
# Perform Integrated Change Contro s prmary focused on MANAGING CHANGE to the pro|ect's SCOPE, whe Montor and Contro Pro|ect Work s prmary focused on MANAGING THE
WAY that SCOPE s EXECUTED. # Approved Change Requests w be mpemented by the Drect and Manage Pro|ect Executon process.
# CCB s responsbe for revewng changes and change requests and ts eve of authorty shoud be speed out n the Pro|ect Management Pan.
The Perform 1ntegrated 4hange 4ontrol process s where you decde whether or not to make them. But youre not the one
actuay makng that decson - a bg part of Perform Integrated Change Contro s that you need to get your changes approved by
the 4hange 4ontrol Board.
After Integrated Change Control, we go back to the *irect / Manage Pro%ect Execution process to put the approved changes
in place
If the 1ntegrated 4hange 4ontrol process says ts OK to go ahead, you make the change. The mportant thng to remember s
that the change reHuests come from Monitor and 4ontrol Pro2ect :ork, but are actuay made durng /irect and Manage
Execution.
O: Once a change s approved, what do I do wth t?
A: You change your pro|ect management pan to ncorporate the change. Ths can mean that you create a new basene wth the
new pro|ect management pan.
9e careful about questions on Change, /ometime evaluations are done, so the 0E12 best thing to do is to look for options
/ometimes evaluation A=3 looking for options are done, then the 0E12 best thing to do is to meet the sponsor or 229 and get the
change approved
2. :ork Performance 1nformation
3. 4hange .eHuests
4lose Pro2ect or Phase? The process of nazng a actvtes across a of the Pro|ect Management Process Groups to formay compete the pro|ect or phase. It s a about shuttng the
pro|ect down propery. Ths ncudes creatng the necessary documentaton and archves, capturng the essons earned, ensurng that the contract s propery cosed, and updatng a
organzatona process assets. # The Transton mpes that the product has been accepted and s ready for ths handover.
Exam: Remember for exam that "You aways cose out a pro|ect, no matter the crcumstances under whch t stops, s termnated or
s competed "
------4losing 5ctivities:
5 2on"rm work is done to requirements
7 Complete procurement closure
D Bain formal acceptance of the product
E Complete fnal performance reporting
F #nde) and archive records
G >pdate lessons learned knowledge base
H @and1o0 completed product
I ,elease resources
1. -inal Product, ervice, or .esult !ransition
2. 5ccepted /elivera0les
# Pro|ect Charter's key aspects are: * Purpose and pro|ect ob|ectves, * Pro|ect sponsor or authorty, * Pro|ect descrpton and requrements, O uccess 4riteria, O 5cceptance 4riteria, O
1dentiAed .isks, * Inta WBS, Premnary Mestones and Summary Budget, and * Pro2ect Manager 5ssignment (wth responsbty and authorty eve)
# Change Contro System: It s aso a coecton of forma documented procedures that dene HOW pro|ect change requests are submtted, vadated, recorded, approved or re|ected,
communcated, and worked wthn the pro|ect. In many areas the Change Contro System s a subset of the Conguraton Management System.
# Conguraton contro s focused on the speccaton of both the deliverables and the processes whe change contro s focused on identifying, documenting and controlling changes to the
project and the product baselines.
Exam @. Whch of the foowng can be found n the Pro|ect Charter?
A. Busness Case Document
Some answers w ceary be wrong. The Busness Case Document s one of the toos and technques from Deveop Pro|ect Charter.
B. Expert |udgment
Some answers are a tte mseadng! Ths s part of the Deveop Pro|ect Charter process-but ts from the toos and technques, not a part of the Pro|ect Charter tsef.
C. Authorzaton for the pro|ect manager
Heres the rght answer! The pro|ect managers authorzaton s ncuded n the pro|ect charter.
D. Pro|ect Management Informaton System
You havent seen ths one yet-ts part of Enterprse Envronmenta Factors, an nput to the Deveop Pro|ect Charter Process, but not n the charter tsef.
4OPE
1nputs !ools G !echniHues Outputs
+
P
6
5
3
3
1
3
<
1. Intervews
2. Focus Groups
3. Factated Workshops
4. Group Creatvty Technques
5. Group Decson Makng Technques
6. Ouestonnares and Surveys
7. Observatons ('|ob Shadowng' by Observer)
8. Prototypes (provdng a workng mode)
P
P
6
5
3
3
1
3
<
3. Organzatona Process Assets
4. Expert |udgment
,
P
6
5
3
3
1
3
<
1. WBS
2. Requrements Documentaton
4. Pro|ect Document Updates
%&
M

G

4
1. Pro|ect Management Pan 1. Inspecton
2. Requrements Documentaton 2. Change Requests
3. Requrements Traceabty Matrx 3. Pro|ect Document Updates
%%
M

G

4
1. Pro|ect Management Pan
2. Change Requests
3. Requrements Documentaton 3. Pro|ect Management Pan Updates
4. Requrements Traceabty Matrx 4. Pro|ect Document Updates
5. Organzatona Process Assets 5. Organzatona Process Assets Updates
l
J
4ollect .eHuirements? The process of denng and documentng stakehoders' needs to meet the pro|ect ob|ectves. In ths process, you nd out a of the stakehoders needs and wrte
them down so that you know what to bud and your requrements can be measured and tracked.
# TT1: 1ntervie#s: Pro|ect Manager or Busness Anayst w do the Intervews wth Sub|ect matter expert and t s One-to-one meetng
# TT2: -ocus <roups: are another way to get a group of peope to dscuss ther needs wth you. The key to ths too es n pckng the sub|ect matter experts and stakehoders to
partcpate n the focus group.
# TT3: -acilitated :orkshops: Cross-functona stakehoders come together n a factated workshop to dscuss and dene requrements that ahect more than one department. In
factated workshops, msunderstandngs and ssues can get reconced a at once because a of the stakehoders are workng together to dene the requrements.
Exam potlight
The prmary dherence between focus groups and facilitated #orkshops are that focus groups are gatherngs of prequaed sub|ect matter experts and stakehoders and factated
workshops consst of cross-functona stakehoders who can dene cross-functona requrements.
# TT4: <roup 4reativity !echniHues: 1. Branstormng 2. Nomna Group Technque: where branstormed deas are voted upon and sorted by prorty, 3. Deph Technque, 4. Idea and
Mnd Mappng, and 5. Amnty Dagram: arge numbers of deas to be sorted nto groups
# TT5: <roup /ecision making techniHues: Unanmty: means everyone agrees on the decson Ma|orty: support from more than 50% of the members of the group,
Puraty: the largest 0lock n a group decdes even f a ma|orty s not acheved, Dctatorshp: one ndvdua makes the decson for the group.
# TT8: !ypes of Prototypes: 1.Proof-of-Prncpe Prototype, 2.Form Study Prototype, 3.Vsua Prototype, and 4.Functona/Workng Prototype. Modern Prototypng (Computerzed)
# Categores of Requrements:
Pro2ect? 1. Busness Requrements, 2. Pro|ect Mgmt Requrements, 3. Devery Requrements, and 4. Potca Requrements.
Product? 1. Technca Requrements, 2. Securty Requrements, 3. Performance Requrements, 4. Cost Requrements, and 5. Ouaty Requrements.
Product scope means the features and functons of the product or servce that you and your team are budng.
Pro2ect scope s a of the work that needs to be done to make the product.
Product scope? means the features and functons of the product or
servce that you and your team are budng.
Pro2ect scope? s a of the work that needs to be done to make the
product.
-ive cope Management processes?
Planning Process <roups
- Coect requrements
- Dene scope
- Create WBS
Monitoring G 4ontrol Process <roups
- Verfy Scope
- Contro Scope
Exam potlight?
The pro2ect scope management plan s a pannng too that
documents how the pro|ect team w go about denng pro|ect scope,
how the work breakdown structure w be deveoped, how changes to
scope w be controed, and how the work of the pro|ect w be vered
and accepted. Scope management pan s a subsdary of the pro|ect
management pan.
- Approved Pro|ect Scope Statement, ts assocated
WBS, WBS Dctonary are the scope 0aseline for the
Pro|ect.
- Competon of Pro|ect Scope s measured aganst the
Pro|ect Management Pan.
- Competon of Product scope s measured aganst
Product Requrements.
-
O: How do I know when Im done coectng
requrements?
A: Your requrements need to be measurabe to be
compete. So ts not enough to wrte down that you
want good performance n your product. You need to
be abe to te peope what measurement counts as
good performance for you.
Eou kno# your reHuirements are complete
#hen youKve got a #ay to verify each of them
once theyKre 0uilt.
1. Pro2ect 4harter 1. .eHuirements /ocumentation .eHuirments /ocument? contans ::::
- busness/pro| ob|ectves,
- Functona/Non Functona reqs,
- quaty reqs, - acceptance crtera, - tranng reqs,
- assumptons/constrants,
- mpact to other organsatona areas..etc
.eHuirements Management Plan:contans:::::
- how req actvtes w be panned, tracked & reported., - cong mgmt
actvtes, - req prortzaton process, traceabty structure
.eHuirements !racea0ility Matrix::::
Ths document shows where the requrements come from, where they
get mpemented, and how they get vered. Its a great way to take a
quck hgh-eve ook at a your requrements and make sure theyre
mapped to specc test cases.
2. takeholder .egister 2. .eHuirements Management Plan (HOWs)
3. .eHuirements !racea0ility Matrix
Exam potlight: the requrements traceabty matrx heps
assure that busness vaue s reazed when the pro|ect s
compete because each requrement s
nked to a busness and pro|ect ob|ectve.
/eAne cope? The process of deveopng a detaed descrpton of the Pro|ect and Product. It turns a requrements nto a more detaed pro|ect scope statement.
Pro|ect Scope statement ncudes: 1. Product scope descrpton and Pro|ect goas, 2. Product acceptance crtera, 3. Pro|ect Deverabes,
4. Pro|ect ncusons and excusons, 5. Pro|ect constrants and assumptons, and 6. Idented rsks reated to the scope.
TT2: Product Anayss ncudes * Product Breakdown, * Systems Anayss, * Requrements Anayss, * Systems Engneerng, * Vaue Engneerng, and * Vaue Anayss.
PMI advocates Pro|ect Ob|ectves that foow the M5.! gudene. S - Specc; M - Measurabe; A - Assgnabe; R - Reastc; T - Tmey.
The pro|ect scope statement tes what work you
are-and are not-gong to do to do n the pro|ect.
1. Pro2ect charter 1. Product analysis: !hen you use product analysis
to de"ne the scope of the work to be done, youre "guring out 3hat
deliverables the team needs to work on in order to build
your scope statement /o product analysis is concerned with how the
work will be done, not whats in it
1. Pro2ect cope tatement The scope statement tes you what you have to do.
Pro2ect cope tatement includes:
* Pro|ect Ob|ectves - need to be measurable
* Product Scope Descrpton
* Product Acceptance Crtera
* Pro|ect /elivera0les: 'he deliverables includes AJA+8'@#=B the K
project creates including project management stu0.
* Pro|ect Excusons
* Pro|ect Constrants: are known limitations 1 such as mt on resources,
budget, schedue & scope
* Pro|ect Assumptons: are things you think are '+>A.
2. .eHuirements /ocumentation 2. 5lternatives 1dentiAcation-: 'hink f other ways that you could do
the work A)ploring di0erent ways to do the work will help you "nd the
one that is most eLcient for the project
2. Pro2ect /ocument Updates:
Incudes:
- stakehoder regster
- requrements traceabty matrx
- requrements documentaton
3. -acilitated :orkshops::When you do Facated Workshops wth
your stakehoders, gure out what they
need, and wrte t a down. An mportant part of stakehoder anayss
s dong your best to set quantabe goas.
4reate :B? The process of subdvdng pro|ect deverabes and pro|ect work nto smaer, more manageabe components. After creaton; t becomes a HUB OF INFORMATION for the
pro|ect. It s a prmary too for verfyng and controng the pro|ect's scope. Every eve n WBS s the detaed expanaton of the eve above t. WBS s a graphca, herachca chart, ogcay
organzed from top to bottom.
# 4ode of account s used to name the WBS (Unque Identcaton), # Pannng packages (Set of work) are between Contro Accounts and Work Packages. # WBS snt tme based, # WBS
does form the Scope Basene, # WBS s a communcaton too, # Created by the entre Pro|ect Team
WBS Dctonay mght ncude 1. the number of the node, 2. the name of the node, 3. the wrtten requrements for the node, 4. to whom t s assgned, 5. tme (Date Assgned and Date Due),
6. cost, and 7. accountng nformaton. # Management Contro Ponts (Contro Account): Where the ntegraton of scope, schedue, and cost take pace and where performance s measured.
Advantages: 1. EV Cacuaton take pace, 2. It s the budng bock of Performance Measurement, and 3. The sum of the contro accounts w add up to the tota pro|ect vaue (Rue of thumb
s *&& Dours). Contro Account may ncude one or more Work Packages, each Work Package represents ony one Contro Account.
Sometmes, partcuary when workng on arge pro|ects that consst of severa subpro|ects, some of the subpro|ects mght not be schedued unt a future date. Obvousy,
t makes sense to deveop the WBS n deta at that future date when the deverabes and subpro|ects are better known and more detas are avaabe. Ths technque s caed rolling
#ave planning.
The WBS doesnt show the order of the work packages or any
dependences between them. Its ony goa s to show the work nvoved
n creatng the product.
The two most common ways of vsuazng the work are by delivera0le
or by phase.
The work package s the 6O:E! eve on a WBS;
Decompose deverabes nto work packages::::s subdvson of pro|ect
deverabes nto smaer components unt the work and deverabes
are dened to the work package eve.
1. Pro2ect cope tatement 1. /ecomposition 4ode of 5ccount 1dentiAer: 'his account identi"er is important$its
how you hook your !9/ into your companys accounting system 'hat
way you can make sure all of the work is paid for
cope Baseline; As the project goes on, you will want to compare how
you are doing to what you planned for /o, the scope baseline is there
to compare against #ts made up of the scope statement, the ()#,
and the ()# *ictionar&
2. WBS Dctonary
'he !9/ 3ictionary contains the details of every (ork
Package #t should include the following;
12ode of accounts identi"er
1 3escription of the work of the component
1 .rganization responsible for completing the component
1/chedule milestone, duration
1/chedule activities associated with the schedule milestones
1,esources Assigned
1Cost estimates
14ualit& requirements
12riteria for acceptance
1 'echnical references
1 2ontract information
3. Organzatona Process Assets(The forms and
tempates here w be reay usefu)
Exam potlight:
The WBS doesnKt show the order of the work packages or any
dependences between them.
3. Scope Basene (Pro2 cope tmt M :B M :B /ict):
Approved changes are changes to the scope management
pan aso, so ts mportant that you re-basene your pro|ect
when they are approved. That way, you aways be
comparng your performance to the most updated pan.
Berify cope? The process of formazng acceptance of the competed pro|ect deverabes. Forma process to verif& and obtain stakeholder acceptance of the completed pro2ect
scope and delivera0les. Usuay performed after Perform Ouaty Contro.
# Verfy Scope happens at the end of each phase and the project and upon devery of Product/Servce/Resut.
# Verfy Scope s concerned wth completeness and acceptance, and Perform Ouaty Contro s concerned wth correctness
# If the pro|ect s canceed/termnated before competon, Berify cope s performed to show where the Pro|ect was n reaton to the Scope when t ended.
# Verfy Scope s a about comparing the *eliverables 3ith the documented #cope to ensure that everythng was competed.
# Verfy Scope s typcay performed by the PM, the /ponsor, the 2ustomer, and the Cunctional Managers, and the resut s a formal, written acceptance by the approprate stakehoders. # If
we don't receve a na sgn oh from our customer; we have to escaate the ssue to our Management.
# Characterstcs of Verfy Scope: 1. Sgnoh, Revew, Inspecton, 2. Documentng competed deverabes, and 3. Ensurng that the deverabes conform to the requrements.
cope veriAcation s prmary concerned wth ACCEPTANCE of
deverabes.
- Ouaty contro s done before scope vercaton.
Bad change:
* Scope Creep: Ths happens when you thnk you know the mpact of a
change so you go ahead, but t turns out that that change eads to
another one, and snce you are aready makng the rst change, you go
wth the next. Then another change comes up, and another, and
another, unt ts hard to te what the scope of the pro|ect s.
* God Patng: Sometmes peope thnk of a reay great mprovement to
the product and go ahead and make t wthout even checkng the
mpact.
1. 5ccepted delivera0les Accepted deverabes are formay sgned oh by the customer.
Forma acceptance receved from the customer acknowedgng forma
stakehoder acceptance of pro|ect deverabes s sent to 4lose Pro2ect
Phase.
(It nvoves a pont-by-pont revew of the Scope and the assocated
Deverabe). Examne the deverabes, Measure t, Inspect t, and
Wegh t.
4. Balidated /elivera0les: These are vadated
deverabes, whch means theyve been through
Perform Ouaty Contro.
4ontrol cope? The process of montorng the status of the pro|ect and product scope and managng changes to the scope basene. Scope Creep w be emnated.
Integrated Change Contro spans: * Contro Scope * Contro Schedue * Contro Cost * Ouaty Contro * Montor and Contro Rsk * Admnster Procurements
# Customer's nterests shoud aways be weghed heavy and disputes should be resolved in favor of the customer.
The goa of Contro Scope s updatng the scope, pan, basene, and
WBS nfo.
1. Bariance analysis 1. :ork Performance Measurements Exam potlight:
Arrange a of the actvtes you do to contro scope n the rght order.:
1. You gure out that you have to make a change
2. Create a change request
3. Get approva to make the change
4. Compare the change aganst the basene
5. Go back and pan for the new work
6. Update the basene
7. Store the updated basene n the conguraton management system
8. Now the team can change the way they do the work
2. :ork Performance 1nformation JA can be used to measure di0erences btwn what was de"ned in the
/cope 9aseline M what was created #t is useful in this process as a
way to investigate and understand the root causes behind these
di0erences
# SCOPE MANAGEMENT s a presentaton of ogca processes to understand requrements, dene, break down, and contro the scope of the pro|ect, and verfy that the pro|ect was competed
correcty. The Pro|ect Manager shoud aways be in control of scope through rgd management of the requrements, detas, and processes, and scope changes shoud be handed n a structured,
procedura, and controed manner. Scope may refer to 1. Product Scope (Features and Functons), and 2. Pro|ect Scope (Work need to be competed).
# A Baseline (whether for Scope, Schedue, Cost, or Ouaty) s the .riginal Plan N All Approved 2hanges.
# Uncontroed changes are often referred to as pro2ect scope creep. Scope Creep Resuts from * Poor nta requrements denton, * Faure to nvove users n eary stages, * A mssng
Scope Basene, * Poor Change Contro, * Pro|ects take ong therefore requrements aso change, * Weak Management, and * Faure to manage user expectatons.
# Work Performance Informaton: Informaton and data, on the status of the pro|ect schedue actvtes beng performed to accompsh the pro|ect work, coected as part of the drect and
manage pro|ect executon processes. # Task: Work not necessary sted n the WBS and s the owest eve of ehort on the pro|ect.
# Work Performance Measurements: Resuts from measurements when comparng PLANNED Vs ACTUAL Technca Performance.
# If a varance s a Beneca Varance: * Keep that varance, * Issue a change request to update the Scope Basene to do the changes n characterstcs.
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1. Decomposton
2. Enterprse Envronmenta Factors
3. Organzatona Process Assets 3. Tempates 3. Mestone st
4. Expert |udgment
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1. Actvty Lst 1. PDM (Precedence Dagrammng Method)
2. Actvty Attrbutes
3. Mestone Lst
5. Organzatona Process Assets 4. Schedue Network Tempates
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2. Actvty Attrbutes
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4. Enterprse Envronmenta Factors 4. Pro|ect Management Software
5. Organzatona Process Assets 5. Expert |udgment
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1. Actvty Lst 1. Actvty Duraton Estmates
2. Actvty Attrbutes
3. Actvty Resource Requrements
4. Resource Caendars 2. Pro|ect Document Updates
5. Pro|ect Scope Statement
6. Enterprse Envronmenta Factors
7. Organzatona Process Assets 5. Expert |udgment
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1. Actvty Lst
2. Actvty Attrbutes
3. Actvty Resource Requrements
4. Actvty Duraton Estmates
5. Pro|ect Schedue Network Dagrams 5. Appyng Leads and Lags
7. Pro|ect Scope Statement 7. Schedung Too
8. Enterprse Envronmenta Factors
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!he processes in !ime Management are:
/eAne 5ctivities: Decomposng the work packages nto actvtes. Frst you come up wth a st of a of the actvtes that w need to be competed.
eHuence 5ctivities: Determnng the order the actvtes need performed n. Next, you gure out whch actvtes need to come before others and put them n the rght order. The man output here s a net#ork diagram, a pcture of how actvtes are reated.
Estimate 5ctivity .esources: Fndng out the quanttes and types of resources needed for the actvtes. Estmate the resources you need to do the |ob, and create a st of them...
Estimate 5ctivity /urations: Determnng how ong the actvtes w take. ...and then estmate the tme t w take to do each actvty.
/evelop chedule: Creatng the pro|ect schedue. Then you bud a schedue from a of the estmates, and the resource and actvty nformaton youve created.
4ontrol chedule: Montorng the schedue and nuencng the factors that can ead to schedue changes. Fnay, you montor and contro changes to the schedue to make sure that t s kept up to date.
/eAne 5ctivities? The process of dentfyng the specc actons to be performed to produce the pro|ect deverabes. The rst step n tme management s gurng out how the pro|ect work
breaks down nto actvtes-and thats what the Dene Actvtes process s for.
/eAning activities s an teratve process performed together by the pro2ect manager and the pro2ect team mem0er
by further decomposing the WBS work packages. Snce the actvty st and WBS can be ooked upon as companon
documents, each actvty shoud have a unque denter that correates t to the WBS work package.
1. Scope Basene
(Approved Pro2 cope tmt M :B M :B
/ict)
1. Actvty Lst
Its a the actvtes that must be accompshed to dever the
work packages
/ecomposition:
An adequate eve of actvty decomposton s generay reached when the actvtes:
Are assgnabe to one person
Can have a eve of ehort determned for them
Can have ther resource needs estmated
Can have ther expected costs reasonaby estabshed
Can have ther progress determned and tracked.
.olling :ave Planning:
Work to be competed n near future s panned n deta and future work s panned at HIGHER eve of the WBS.
2. .olling :ave Planning
!hen you plan this way, you decompose only the activities that you need to
plan for because theyre coming up soon "rst 8ou leave everything else
planned at the milestone level until it gets closer to the time when youll do it
2. Actvty Attrbutes
- Actvty ID, WBS ID, Actvty Name, Actvty descrpton,
predecessor actvtes, successor actvtes, ogca
reatonshps, leads and lags, resource requrements,
mposed dates, assumtons & constrants,.
eHuence 5ctivities? Propery sequencng actvtes nvoves determnng the dependences and reatonshps between actvtes and appyng eads and ags
5ctivity dependencies: Mandatory, Dscretonary & Externa
5ctivity relationships: There are four types of actvty precedence reatonshps:
-inishCtoCtart (FS): The successor actvty can begn ony after the predecessor actvty s competed (Actvty B can't start unt Actvty A s competed). Ths s the most common type of relationship. For exampe, a house's concrete foundaton can't be poured unt the excavaton actvty s fuy competed.
-inishCtoC-inish (FF): The competon of the successor actvty depends upon the competon of the predecessor actvty (Actvty B can't nsh unt Actvty A s nshed). Ths reatonshp s necessary when both actvtes need to nsh at the same tme (or very cose) to each other, but there's not any reatonshp
between the actvty start dates. For exampe, you must nsh Testng before you nsh Documentaton.
tartCtoCtart (SS): The successor actvty can't start unt the predecessor actvty starts (Actvty B can't start unt Actvty A has started). Ths reatonshp s needed when the startng dates of the actvtes are dependent upon each other, but the endng dates are not. For exampe, you must start Desgnng and
wat for two weeks ag n order to have enough of the desgn competed to start codng.
tartCtoC-inish (SF): The competon of the successor actvty depends upon the predecessor actvty startng (Actvty B can't compete unt Actvty A has started). For exampe, n a pro|ect n whch equpment s beng repaced, before the od equpment can be fuy decommssoned (Actvty B), the nta testng of
the new equpment shoud have been successfuy started (Actvty A). The testng doesn't need to be fuy competed but |ust far enough aong that the team can be assured the new equpment s functonng before the od equpment s dsmanted.
There are two types of 3et#ork /iagrams:
- Arrow Dagrammng Method (ADM)
- Precedence Dagrammng Method (PDM)
The Arrow Dagrammng Method (5/M) creates dagrams known as activityConCarro# "5O5$. Ths s because ADM dagrams use actvtes shown on arrows and connected by nodes, usuay shown as crces. ADMs drawback s that t can ony show AnishCtoCstart (FS) reatonshps. In order to show reatonshps
between tasks on dherent node branches, ADM dagrams use dummy actvtes.
The Precedence Dagrammng Method (P/M) creates dagrams known as activityConCnode "5O3$. It uses nodes, usuay shown as squares, to hod the actvtes whch are connected by arrows to show the reatonshps. The PDM dagram s the one most commony used.
1. Pro2ect chedule 3et#ork /iagrams?
- Graphcay show the reatonshps, sequences, and duratons
of a actvtes from the start to the end of the pro|ect.
6ead time s overap between tasks that have a dependency. For exampe, f a task can start when ts predecessor s haf-
nshed, you can specfy a nsh-to-start dependency wth a ead tme of 50 percent for ts successor task.You enter ead
tme as a negative value.
6ag time s a deay between tasks that have a dependency. For exampe, f you need a two-day deay between the nsh
of one task and the start of another, you can estabsh a nsh-to-start dependency and specfy a two-day ag tme. You
enter ag tme as a positive value.
q Lead tme causes the successor task to begn before ts predecessor task concudes...FS-2 woud schedue the successor
task to start before the predecessor task nsh.
q Lag tme causes the successor task to begn some tme after ts predecessor task concudes...for exampe, -M% woud
deay the start of the successor by 1 day.
2. Dependency Determnaton:
-Mandatory Predecessors (hard ogc)
-Dscretonary (ogca or Preferred order to the actvtes)
-Externa: Externa dependences can aso ead to schedung probems when
no hard date s avaabe
2. Pro|ect Document Updates:
4. Pro|ect Scope Statement:
Onowning the full scope of the project helps to be
sure that we have got all of the activities needed
to do the work
3. Appyng 6eads and 6ags
Estimating 5ctivity .esource? The process of estmatng the type and quanttes of matera, peope, equpment, or suppes requred to perform each actvty. Before you can assgn resources
to your pro|ect, you need to know whch ones youre authorzed to use on your pro|ect. Thats an nput, and ts caed .esource 4alendars.
# .esource 4alendars specfy WHEN and HOW LONG dented pro|ect resource w be avaabe durng the pro|ect.
.ough order of magnitude estimate: These are usuay top-down estmates made by expert |udgment. The varance
range for ths type of estmate s expected to be C)I( to M+I( of the na actua gure. Durng eary ntatng or
pannng phases, ths may be the ony estmate avaabe.
Budget estimate: These have ess varance than rough order of magntude, but they are st broad estmates. The
varance range for ths type of estmate s expected to be C%&( to )I( of the na actua gure. Budget estmates
shoud be used once pannng processes are underway, and prevous rough order of magntude estmates shoud be re-
estmated.
/eAnitive estimate: Ths type s the most accurate estmate. The varance range for ths type of estmate s expected to
be CI( to %&(. Budget estmates of ths type shoud be expected once substanta pannng has occurred or pro|ect
executon has been underway
1. 5lternatives 5nalysis:
#dentifying resource needs will require evaluation of di0erent resource types,
"nancial comparisons between staLng or outsourcing, renting versus leasing,
and building versus buying
1. 5ctivity .esource .eHuirements
2. BottomCup Estimating 2. .esource Breakdo#n tructure
3. .esource 4alendars
Estimating 5ctivity /uration? The process of approxmatng the number of work perods needed to compete ndvdua actvtes wth estmted resources.
# Anaogous (top down): s when you ook at actvtes from prevous smar actvtes. The degree of smarty ahects accuracy. Ths technque shoud be used eary n the estmatng cyce when
there s not much deta known about the actvty. It uses Hstorca nformaton and expert |udgement. It s ess costy, ess tme consumng than others, and ess accurate. It can be apped to a
tota pro|ect or to segments of a pro|ect and may be used n con|uncton wth other estmatng methods.
# Parametrc/Ouanttatey-Based Estmatng: It uses a statstca reatonsp between HISTORICAL DATA and OTHER VARIABLES (Ex: Square footage n constructon) to cacuate an estmate for
actvty parameters, such as cost, budget, and duraton. It can be apped to a tota pro|ect or to segments of a pro|ect and may be used n con|uncton wth other estmatng methods. Cost = Oty
n unts X Unt Rate.
# Three-Pont Estmate or Tranguar Dstrbuton: Come up wth three ponts, Optmstc, Pessmstc, and Most Lkey (Reastc) = (P+R+O)/3
# PERT (Program Evauaton and Revew Technque)/Beta/Weghted Three-Pont Estmate = (P+4R+O)/6 # Standard Devaton o = (P-O)/6
Ehort: The number of abour unts requred to compete a schedue actvty or WBS component. Usuay expressed as stah hours, stah days, or stah weeks. (Requrements for ehort estmaton:
The Expert |udgement, Task Compexty, S Leve, and Expectatons).
Duraton: The tota number of work perods (not ncudng hodays and non-workng perods) requred to compete a schedue actvty or WBS component. Usuay expressed as workdays or
workweeks. (Requrements for Duraton estmaton: Resource Avaabty and Resource Capabty). Eapsed Tme: Watng perods.
.eserve analysis
Reserve anayss ooks at varous factors n the pro|ect, such as rsks and overa uncertanty, and sets asde separate
contingency reserves, time reserves, or 0uLers that can be drawn from f actvtes exceed ther duraton. Buhers
can aso acheve more accurate estmates by movng the paddng out of the actvty and nto a separate bucket where t
can be better managed.
Whether ths reserve tme s added to the schedue as a whoe, to ndvdua actvtes, or to cruca ponts wthn the
schedue depends upon the pro|ect manager and hs or her schedung approach.
You may have guessed from the name that the Actvty /U.5!1O3 Estmates are aways duraton estmates, not ehort
estmates, so they show you caendar tme and not |ust person-hours.
Deuristic (ke a rue of thumb)
1. Anaogous Estmatng:
is when you look at activities from previous projects that were similar to this
one and look at how long it took to do similar
work before
!hreeCPoint Estimates? are when you come up wth three numbers: a realistic estimate (R) thats most likely to
occur, an optimistic (O) one that represents the 0estCcase scenario, and a pessimistic (P) one that represents the
#orstCcase scenario. The na estmate s the average. = (P + R + O)/2
PE.!:s the most common form of three-pont estmaton. Snce the pessmstc and optmstc estmates are ess key to
happen than the the norma estmate, the norma estmate s weghted (by mutpyng t by 4) and added to the optmstc
and pessmstc estmates, and then the whoe thng s dvded by 6 to gve an expectued
duraton. The formua ooks ke ths:
(Optmstc Duraton + (4* Most key Duraton) + Pessmstc Duraton) / 6 = Expected duraton
Expected Actvty Duraton E5/ = " O M F. M P$ / '
The formua for tandard /eviation / were most key to encounter on the PMP examnaton s: / Q " P C O$ / '
Actvty Varance 5B = R "P C O$ / ' S
)

* ParkinsonTs 6a# states that work expands to the tme avaabe. Ths means that f we estmated an actvty w
take two weeks, t' end up takng two weeks even f t coud have been nshed t n one.
Test may ask you to provde range for an ndvdua actvty estmate: you cacuate the range usng E5/ +/- /
Start range = E5/ C /
End range = E5/ M /
For ndng / for entre pro|, add-up Actvty Varance for a the ndvdua actvtes and do sHuare root of 5B. In order
to nd SD of a seres of tems, remember the rue, you cannot add /s; you must rst convert the SD nto varances,
add the varances and then take the SOUARE ROOT of the tota and convert back nto SD.
2. Parametrc Estmatng:
means plugging data about your project into a formula, spreadsheet,
database, or computer program that comes up with an estimate
(It doesn't ncude LAGS. It may ncude some ndcaton of the
range of possbe resuts.)
3. !hreeCpoint Estimates
4. .eserve 5nalysis : looks at various factors in the project, such as risks
and overall uncertainty, and sets aside separate contingency reserves, time
reserves, or bu0ers that can be drawn from if activities e)ceed their duration.
O: Dherence between a duration estimate
and an eLort estimate?
A: Duraton s the amount of tme that an actvty takes, whe
ehort s the tota number of person-hours that are expended.
If t takes two peope sx hours to carve the ce
scupture for the centerpece of a weddng, the duraton s sx
hours. But snce 2 peope worked on t for the whoe tme, t
took 12 person-hours of ehort to create!
/evelop chedule? The process of anayzng actvty sequences, duratons, resource requrements, and schedue constrants to create the pro|ect schedue. It determnes the panned start and
nsh dates for pro|ect actvtes and mestones.
# 4ritical Path Method: It cacuates the theoretca Eary Start and Fnsh Dates, and Late Start and Fnsh Dates, for a actvtes wthout regard for any resource mtatons, by performng a
Forward and Backward pass anayss through the schedue network. 4ritical paths have ether ZERO or NEGATIVE Tota Foat.
-loat = 6ate tart C Early tart OR
6ate -inish C Early -inish
# 4ritical 4hain Method: The resourceCconstrained critical path is kno#n as the 4ritical 4hain. The ongest sequence of resource-eveed tasks s the crtca chan. It tres to ad|ust for
probems n estmatng and managng tasks that resut from 1. poor mut-taskng, 2. estmates wth too much contngency for uncertanty, 3. work that expands to the avaabe tme, 4.
watng unt the atest possbe tme to start and 5. ack of prortzaton. Crtca Chan Method focuses on managng remanng buher duratons aganst the remanng duratons of task chans. In
CCM; buhers are two types: 1. Pro|ect Buher (Protects the target nsh date from sppage aong the Crtca Chan), and 2. Feed Buher (Protects the Crtca Chan from sppage aong the Feedng
Chans). # Foat/Sak/Tota Foat: amount of tme an actvty can sp before t causes deay n pro|ect. * Foat for actvtes on CP s 0. CP- next ongest path= oat. # LEAD: Task can be started
before competon of the predecessor (Ex: Start wrtng the Tranng Matera before competon of the Testng). # LAG: Fnsh to Fnsh - The successor cannot be started before nshng the
predecessor (Ex: Pourng Concrete).
# chedule 4ompression: ncudes Fast-trackng and crashng. # Crashng adds more resources, usuay personne, n order to decrease an actvty's duraton. Crashng amost aways
ncreases cost. Over Tme s consdered as Crashng. Cheapest Task has to be crashed rst. # Heurstcs: Rues for whch no formua exsts. Usuay derved through tra and error. # Free Foat:
how much tme an actvty can be deayed wthout ahectng the eary start date of subsequent dependent actvtes. # Resource Leveng: 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 . It can often cause the orgna crtca path to change.
Exam: #Can there be more than ONE crtca path? Yes, can have many crtca paths.# :ould you leave the pro2ect #ith 3egative >oat? No; you woud compress the schedue.
To nd the -6O5! or 654K for an actvty, gure out how much t can sp before t makes the pro|ect ate. The oat for
any actvty on the crtca path s 9E.O!
4alculating >oat
Cacuatng oat requres ether a competed node wth some combnaton of eary start, eary nsh, ate start, and ate
nsh supped, or we have to utze the network dagram.
There are three knds of oat: free oat, tota oat, and pro|ect oat.
Pro2ect -loat: Pro|ect oat s easy. It's ony appcabe when there's a duraton constrant on the entre pro|ect. Usng our
contnung exampe, we know that the crtca path (ongest duraton) s 17 perods. If the pro|ect had a constrant of 20
perods, then the pro|ect oat woud be three perods.
-ree -loat: Free oat s how ong an actvty's duraton can ncrease wthout mpactng the start of any successor
actvtes. Free oat requres that we know the early start of actvtes because ts cacuated by takng the eary start of
the successor actvty mnus the eary start pus the duraton of ts predecessor actvty.
-ree >oat Q E "of successor$ C " E of predecessior M /U.5!1O3 of
predecessor $
!otal >oat or total slack s how much eeway an actvty has before an extenson to ts duraton deays the end date of
the pro|ect. By ookng at the sampe dagram, we can see that the tota pro|ect duraton s 17 days. Snce the combned
duraton of Actvty A and Actvty C s 15 days, Actvty A has a tota oat of two days as does Actvty C because ether or
both can sde a tota of two days wthout engthenng the duraton of the pro|ect.
!otal >oat Q "6- C E-$ of that activity O. "6CE$ of that activity
## E;5M: Dont forget that when two paths ntersect, you have to decde whch ES or LF vaue to take for the cacuaton
n the next node. For the forward pass, use the 65.<E. vaue; for the backward pass, use the M566E. one.
1. 4ritical Path Method 4PM?
Exam #potlight5 2PM manages the total (oat of schedule network paths,
whereas critical chain manages bu0er activity durations
1. Pro2ect chedule (Formats 5 Milestone 2harts, 7 9ar
2harts, and D Project /chedule =etwork 3iagrams)
0et3ork *iagram; to show interdependencies beween
activities
Milestone charts; to report to senior management
)ar charts; to track progress, to report to the team
4ritical Path: Its the strng of actvtes that, f you add up a of the duratons, s onger than any other path through the
network. It usuay starts wth the rst actvty n the network and usuay ends wth the ast one.
The reason that the crtca path s, we, crtca, s that every snge actvty on the path must nsh on tme n order for
the pro|ect to come n on tme. A deay n any one of the crtca path actvtes w cause the entre pro|ect to be deayed.
There are -OU. types of 4O3!.513!:
tart 3o Earlier !han "3E! or SNE): The actvty can't start unt a predetermned date.
tart 3o 6ater !han "36! or SNL): The actvty must be started before but not ater than a predetermned date.
-inish 3o Earlier !han "-3E! or FNE): The actvty must be nshed after a predetermned date.
-inish 3o 6ater !han (-36! or FNL): The actvty must be nshed before a predetermned date
A good rule of thumb is that sequential activities can sometimes be fast+tracked by up to 667 #n other words, if
you:re fast1tracking, you can start the second of two sequential activities when the frst activit& is 887 complete 'here
is risk involved @owever, this seems to be a level of fast1tracking risk that is normally acceptable
4ritical chain method s a schedue network anayss technque that w modfy the pro|ect schedue by accountng for
mted or restrcted resources. After the pro|ect schedue network dagram s constructed usng duraton estmates,
dependences, and constrants, resource availa0ility s entered nto the schedung too. The moded schedue s
cacuated and you nd that t often changes the crtca path. The new crtca path showng the resource restrctons s
caed the crtca chan. A few steps are nvoved n the critical chain process:
- Construct the schedue network dagram usng actvty duraton estmates
- Dene dependences
- Dene constrants
- Cacuate crtca path
- Enter resource availa0ility nto the schedue
- .ecalculate for the critical chain
2. 4ritical 4hain Method:
3. .esource 6eveling: #f 57 programmers are needed in week D but only
eight are available, if activity A were most critical then E programmers would
be assigned to it so that its duration and sequencing remains intact @ow the
remaining pool of E programmers would be allocated depends on the
importance of the remaining two activities, how much (oat they have, and
what resource requirements the successor activities need
Exam #potlight; +esource leveling can cause the original critical path to
change
2. chedule Baseline: 'he project schedule will undergo
some manner of approval or sign+o9 .nce approved, the
schedule baseline comes into e)istence
4. :hatCif cenario 5nalysis:Monte Carlo anal&sis is a computer1driven
simulation technique that applies di0erent variables to the schedule, and the
results can identify high1risk and vulnerable areas within the schedule
3. chedule /ata: At a minimum, the schedule data includes
the milestones, activities, activity attributes, assumptions, and
constraints
Milestone chart 1 for reporting to senior mgmt4customer
9ar chart 1 for tracking progress, to report to the team
6. .esource 4alendars 6. chedule 4ompression?
+:ast tracking; involved doing critical path activities in parallel
1Crashing; resources could be added to critical path, always results in
increased costs
8. chedule 3et#ork 5nalysis:
is the various techniques used to analyze and apply scenarios to the schedule
/chedule network analysis includes the critical path method, critical chain
method, resource leveling and smoothing, 3hat+if anal&sis, and
schedule compression, as well as any other analysis methods employed by
the project manager
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9. Organzatona Process Assets 4. Pro|ect Document Updates
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1. Pro|ect Management Pan 1. Performance Revews 1. Work Performance Measurements (SV & SPI vaues)
2. Pro|ect Schedue 2. Varance Anayss (SV/SPI) 2. Change Requests
3. Resource Leveng 3. Pro|ect Management Pan Updates
4. Organzatona Process Assets 4. What-f Scenaro Anayss 4. Pro|ect Document Updates
5. Ad|ustng Leads and Lags 5. Organzatona Process Assets Updates
6. Schedue Compresson
7. Schedung Too
8. Pro|ect Management Software
8. chedule 3et#ork 5nalysis:
is the various techniques used to analyze and apply scenarios to the schedule
/chedule network analysis includes the critical path method, critical chain
method, resource leveling and smoothing, 3hat+if anal&sis, and
schedule compression, as well as any other analysis methods employed by
the project manager
4ritical Path: Its the strng of actvtes that, f you add up a of the duratons, s onger than any other path through the
network. It usuay starts wth the rst actvty n the network and usuay ends wth the ast one.
The reason that the crtca path s, we, crtca, s that every snge actvty on the path must nsh on tme n order for
the pro|ect to come n on tme. A deay n any one of the crtca path actvtes w cause the entre pro|ect to be deayed.
There are -OU. types of 4O3!.513!:
tart 3o Earlier !han "3E! or SNE): The actvty can't start unt a predetermned date.
tart 3o 6ater !han "36! or SNL): The actvty must be started before but not ater than a predetermned date.
-inish 3o Earlier !han "-3E! or FNE): The actvty must be nshed after a predetermned date.
-inish 3o 6ater !han (-36! or FNL): The actvty must be nshed before a predetermned date
A good rule of thumb is that sequential activities can sometimes be fast+tracked by up to 667 #n other words, if
you:re fast1tracking, you can start the second of two sequential activities when the frst activit& is 887 complete 'here
is risk involved @owever, this seems to be a level of fast1tracking risk that is normally acceptable
4ritical chain method s a schedue network anayss technque that w modfy the pro|ect schedue by accountng for
mted or restrcted resources. After the pro|ect schedue network dagram s constructed usng duraton estmates,
dependences, and constrants, resource availa0ility s entered nto the schedung too. The moded schedue s
cacuated and you nd that t often changes the crtca path. The new crtca path showng the resource restrctons s
caed the crtca chan. A few steps are nvoved n the critical chain process:
- Construct the schedue network dagram usng actvty duraton estmates
- Dene dependences
- Dene constrants
- Cacuate crtca path
- Enter resource availa0ility nto the schedue
- .ecalculate for the critical chain
4ontrol chedule? The process of montorng the status of the pro|ect to update pro|ect progress and managng changes to the schedue basene.
# Schedue Basene s updated, whenever the Customer requests a sgncant change and when orgna estmates were wrong.
3. :ork Performance 1nformation:
!ork performance information is any data that can
be considered related to the work which produces
the project deliverables A)amples are schedule
and progress status information, budget and cost
status, quality status, estimates to complete,
resource utilization nformaton, and lessons
learned
# D5MMO4K 5ctivity: For contro and mangement communcaton, the broader, more comprehensve summary actvty.
# Path 4onvergence? The mergng or |onng parae schedue network paths nto the same node n a pro|ect schedue network dagram. Path convergence s characterzed by a schedue actvty
wth more than one predecessor actvty. # Path /ivergence: Extendng or generatng parae schedue network paths from the same node n a pro|ect shedue network dagram. Path devergence s
characterzed by a schedue actvty wth more than one successor actvty.
Next, you gure out whch actvtes need to come before others and put them n the rght order. The man output here s a net#ork diagram, a pcture of how actvtes are reated.
Estmate the resources you need to do the |ob, and create a st of them...
Then you bud a schedue from a of the estmates, and the resource and actvty nformaton youve created.
Fnay, you montor and contro changes to the schedue to make sure that t s kept up to date.
/eAning activities s an teratve process performed together by the pro2ect manager and the pro2ect team mem0er
by further decomposing the WBS work packages. Snce the actvty st and WBS can be ooked upon as companon
documents, each actvty shoud have a unque denter that correates t to the WBS work package.
/ecomposition:
An adequate eve of actvty decomposton s generay reached when the actvtes:
Are assgnabe to one person
Can have a eve of ehort determned for them
Can have ther resource needs estmated
Can have ther expected costs reasonaby estabshed
Can have ther progress determned and tracked.
.olling :ave Planning:
Work to be competed n near future s panned n deta and future work s panned at HIGHER eve of the WBS.
and ags
(FS): The successor actvty can begn ony after the predecessor actvty s competed (Actvty B can't start unt Actvty A s competed). Ths s the most common type of relationship. For exampe, a house's concrete foundaton can't be poured unt the excavaton actvty s fuy competed.
(FF): The competon of the successor actvty depends upon the competon of the predecessor actvty (Actvty B can't nsh unt Actvty A s nshed). Ths reatonshp s necessary when both actvtes need to nsh at the same tme (or very cose) to each other, but there's not any reatonshp
). Ths reatonshp s needed when the startng dates of the actvtes are dependent upon each other, but the endng dates are not. For exampe, you must start Desgnng and
(SF): The competon of the successor actvty depends upon the predecessor actvty startng (Actvty B can't compete unt Actvty A has started). For exampe, n a pro|ect n whch equpment s beng repaced, before the od equpment can be fuy decommssoned (Actvty B), the nta testng of
the new equpment shoud have been successfuy started (Actvty A). The testng doesn't need to be fuy competed but |ust far enough aong that the team can be assured the new equpment s functonng before the od equpment s dsmanted.
. Ths s because ADM dagrams use actvtes shown on arrows and connected by nodes, usuay shown as crces. ADMs drawback s that t can ony show AnishCtoCstart (FS) reatonshps. In order to show reatonshps
. It uses nodes, usuay shown as squares, to hod the actvtes whch are connected by arrows to show the reatonshps. The PDM dagram s the one most commony used.
6ead time s overap between tasks that have a dependency. For exampe, f a task can start when ts predecessor s haf-
nshed, you can specfy a nsh-to-start dependency wth a ead tme of 50 percent for ts successor task.You enter ead
tme as a negative value.
6ag time s a deay between tasks that have a dependency. For exampe, f you need a two-day deay between the nsh
of one task and the start of another, you can estabsh a nsh-to-start dependency and specfy a two-day ag tme. You
enter ag tme as a positive value.
q Lead tme causes the successor task to begn before ts predecessor task concudes...FS-2 woud schedue the successor
task to start before the predecessor task nsh.
q Lag tme causes the successor task to begn some tme after ts predecessor task concudes...for exampe, -M% woud
deay the start of the successor by 1 day.
.ough order of magnitude estimate: These are usuay top-down estmates made by expert |udgment. The varance
range for ths type of estmate s expected to be C)I( to M+I( of the na actua gure. Durng eary ntatng or
pannng phases, ths may be the ony estmate avaabe.
Budget estimate: These have ess varance than rough order of magntude, but they are st broad estmates. The
varance range for ths type of estmate s expected to be C%&( to )I( of the na actua gure. Budget estmates
shoud be used once pannng processes are underway, and prevous rough order of magntude estmates shoud be re-
estmated.
/eAnitive estimate: Ths type s the most accurate estmate. The varance range for ths type of estmate s expected to
be CI( to %&(. Budget estmates of ths type shoud be expected once substanta pannng has occurred or pro|ect
executon has been underway
.eserve analysis
Reserve anayss ooks at varous factors n the pro|ect, such as rsks and overa uncertanty, and sets asde separate
contingency reserves, time reserves, or 0uLers that can be drawn from f actvtes exceed ther duraton. Buhers
can aso acheve more accurate estmates by movng the paddng out of the actvty and nto a separate bucket where t
can be better managed.
Whether ths reserve tme s added to the schedue as a whoe, to ndvdua actvtes, or to cruca ponts wthn the
schedue depends upon the pro|ect manager and hs or her schedung approach.
You may have guessed from the name that the Actvty /U.5!1O3 Estmates are aways duraton estmates, not ehort
estmates, so they show you caendar tme and not |ust person-hours.
Deuristic (ke a rue of thumb)
!hreeCPoint Estimates? are when you come up wth three numbers: a realistic estimate (R) thats most likely to
occur, an optimistic (O) one that represents the 0estCcase scenario, and a pessimistic (P) one that represents the
#orstCcase scenario. The na estmate s the average. = (P + R + O)/2
PE.!:s the most common form of three-pont estmaton. Snce the pessmstc and optmstc estmates are ess key to
happen than the the norma estmate, the norma estmate s weghted (by mutpyng t by 4) and added to the optmstc
and pessmstc estmates, and then the whoe thng s dvded by 6 to gve an expectued
duraton. The formua ooks ke ths:
(Optmstc Duraton + (4* Most key Duraton) + Pessmstc Duraton) / 6 = Expected duraton
Expected Actvty Duraton E5/ = " O M F. M P$ / '
The formua for tandard /eviation / were most key to encounter on the PMP examnaton s: / Q " P C O$ / '
Actvty Varance 5B = R "P C O$ / ' S
)

* ParkinsonTs 6a# states that work expands to the tme avaabe. Ths means that f we estmated an actvty w
take two weeks, t' end up takng two weeks even f t coud have been nshed t n one.
Test may ask you to provde range for an ndvdua actvty estmate: you cacuate the range usng E5/ +/- /
Start range = E5/ C /
End range = E5/ M /
For ndng / for entre pro|, add-up Actvty Varance for a the ndvdua actvtes and do sHuare root of 5B. In order
to nd SD of a seres of tems, remember the rue, you cannot add /s; you must rst convert the SD nto varances,
add the varances and then take the SOUARE ROOT of the tota and convert back nto SD.
To nd the -6O5! or 654K for an actvty, gure out how much t can sp before t makes the pro|ect ate. The oat for
any actvty on the crtca path s 9E.O!
4alculating >oat
Cacuatng oat requres ether a competed node wth some combnaton of eary start, eary nsh, ate start, and ate
nsh supped, or we have to utze the network dagram.
There are three knds of oat: free oat, tota oat, and pro|ect oat.
Pro2ect -loat: Pro|ect oat s easy. It's ony appcabe when there's a duraton constrant on the entre pro|ect. Usng our
contnung exampe, we know that the crtca path (ongest duraton) s 17 perods. If the pro|ect had a constrant of 20
perods, then the pro|ect oat woud be three perods.
-ree -loat: Free oat s how ong an actvty's duraton can ncrease wthout mpactng the start of any successor
actvtes. Free oat requres that we know the early start of actvtes because ts cacuated by takng the eary start of
the successor actvty mnus the eary start pus the duraton of ts predecessor actvty.
-ree >oat Q E "of successor$ C " E of predecessior M /U.5!1O3 of
predecessor $
!otal >oat or total slack s how much eeway an actvty has before an extenson to ts duraton deays the end date of
the pro|ect. By ookng at the sampe dagram, we can see that the tota pro|ect duraton s 17 days. Snce the combned
duraton of Actvty A and Actvty C s 15 days, Actvty A has a tota oat of two days as does Actvty C because ether or
both can sde a tota of two days wthout engthenng the duraton of the pro|ect.
!otal >oat Q "6- C E-$ of that activity O. "6CE$ of that activity
## E;5M: Dont forget that when two paths ntersect, you have to decde whch ES or LF vaue to take for the cacuaton
n the next node. For the forward pass, use the 65.<E. vaue; for the backward pass, use the M566E. one.
4ritical Path: Its the strng of actvtes that, f you add up a of the duratons, s onger than any other path through the
network. It usuay starts wth the rst actvty n the network and usuay ends wth the ast one.
The reason that the crtca path s, we, crtca, s that every snge actvty on the path must nsh on tme n order for
the pro|ect to come n on tme. A deay n any one of the crtca path actvtes w cause the entre pro|ect to be deayed.
There are -OU. types of 4O3!.513!:
tart 3o Earlier !han "3E! or SNE): The actvty can't start unt a predetermned date.
tart 3o 6ater !han "36! or SNL): The actvty must be started before but not ater than a predetermned date.
-inish 3o Earlier !han "-3E! or FNE): The actvty must be nshed after a predetermned date.
-inish 3o 6ater !han (-36! or FNL): The actvty must be nshed before a predetermned date
A good rule of thumb is that sequential activities can sometimes be fast+tracked by up to 667 #n other words, if
you:re fast1tracking, you can start the second of two sequential activities when the frst activit& is 887 complete 'here
is risk involved @owever, this seems to be a level of fast1tracking risk that is normally acceptable
4ritical chain method s a schedue network anayss technque that w modfy the pro|ect schedue by accountng for
mted or restrcted resources. After the pro|ect schedue network dagram s constructed usng duraton estmates,
dependences, and constrants, resource availa0ility s entered nto the schedung too. The moded schedue s
cacuated and you nd that t often changes the crtca path. The new crtca path showng the resource restrctons s
caed the crtca chan. A few steps are nvoved n the critical chain process:
- Construct the schedue network dagram usng actvty duraton estmates
- Dene dependences
- Dene constrants
- Cacuate crtca path
- Enter resource availa0ility nto the schedue
- .ecalculate for the critical chain
30.25
64.00
2.25
4.70
10.06
3.87 7.74
-3.87 -7.74
4ritical Path: Its the strng of actvtes that, f you add up a of the duratons, s onger than any other path through the
network. It usuay starts wth the rst actvty n the network and usuay ends wth the ast one.
The reason that the crtca path s, we, crtca, s that every snge actvty on the path must nsh on tme n order for
the pro|ect to come n on tme. A deay n any one of the crtca path actvtes w cause the entre pro|ect to be deayed.
There are -OU. types of 4O3!.513!:
tart 3o Earlier !han "3E! or SNE): The actvty can't start unt a predetermned date.
tart 3o 6ater !han "36! or SNL): The actvty must be started before but not ater than a predetermned date.
-inish 3o Earlier !han "-3E! or FNE): The actvty must be nshed after a predetermned date.
-inish 3o 6ater !han (-36! or FNL): The actvty must be nshed before a predetermned date
A good rule of thumb is that sequential activities can sometimes be fast+tracked by up to 667 #n other words, if
you:re fast1tracking, you can start the second of two sequential activities when the frst activit& is 887 complete 'here
is risk involved @owever, this seems to be a level of fast1tracking risk that is normally acceptable
4ritical chain method s a schedue network anayss technque that w modfy the pro|ect schedue by accountng for
mted or restrcted resources. After the pro|ect schedue network dagram s constructed usng duraton estmates,
dependences, and constrants, resource availa0ility s entered nto the schedung too. The moded schedue s
cacuated and you nd that t often changes the crtca path. The new crtca path showng the resource restrctons s
caed the crtca chan. A few steps are nvoved n the critical chain process:
- Construct the schedue network dagram usng actvty duraton estmates
- Dene dependences
- Dene constrants
- Cacuate crtca path
- Enter resource availa0ility nto the schedue
- .ecalculate for the critical chain
4O!
1nputs !ools G !echniHues Outputs
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<1. Scope Basene 1. Expert |udgment
2. Pro|ect Schedue
3. Parametrc Estmatng (Uses Statstca reatonshp) 3. Pro|ect Document Updates
5. Enterprse Envronmenta Factors 5. Three-Pont Estmates
6. Organzatona Process Assets
9. Pro|ect Management Estmatng Software
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<1. Actvty Cost Estmates
2. Bass of Estmates
3. Scope Basene 3. Expert |udgment
4. Pro|ect Schedue 4. Hstorca Reatonshps
(Expendtures, Labtes, and Reserves)
3. Pro|ect Document Updates
7. Organzatona Process Assets
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3. Change Requests
4. Organzatona Process Assets 4. Performance Revews 4. Pro|ect Management Pan Updates
5. Organzatona Process Assets Update
6. Pro|ect Management Software 6. Pro|ect Document Updates
# Pro|ect Cost Basene = Pro|ect Estmates + (Cost) Contngency Reserves; # Pro|ect Cost Budget = Pro|ect Cost Basene + Management Reserves
# PV: Panned Vaue / Budgeted Cost of Work Schedued (BCWS) = BAC X Panned % Competed
# EV: Earned Vaue / Budgeted Cost of Work Performed (BCWP) = BAC X Actua % Competed
# AC: Actua Cost / Actua Cost of Work Performed (ACWP) = SUM of the Costs for a gven perod of tme.
BAC
AC
AC%
Panned%
PV (panned % X BAC)
EV (AC% X BAC)
Sch
SV=EV - PV $0
SPI = EV / PV #DIV/0!
Cost
CV=EV - AC $0
CPI=EV / AC #DIV/0! 400,000
EAC = BAC / CPI #DIV/0!
ETC = EAC - AC #DIV/0!
VAR = BAC - EAC #DIV/0!
TCPI|BAC| = (BAC-EV)/(BAC-AC) #DIV/0!
TCPI|EAC| = (BAC-EV)/(EAC-AC) #DIV/0!
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Estimate 4osts: Deveop estmated costs for each schedued actvty.
/etermine Budget: Aggregate actvty costs nto an approved pro|ect budget.
4ontrol 4osts: Montor, manage, and contro costs.
cost management pan ncudes:
what types of ndrect costs, f any, w be posted aganst the pro|ect
unts of currency to be used
precson eve/acceptabe roundng for costs
currency converson ssues
acceptabe threshods for cost varances
the genera edger or contro accounts for expenses and costs
the performance measurement formuas that w be used
at what ponts n the pro|ect performance measurements w be made
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J Estimate 4osts? The process of deveopng an approxmaton of the monetary resources needed to compete pro|ect actvtes. It s performed after Dene Scope, Create WBS, Dene Actvtes, Estmate Actvty Resources, and
Estmate Actvty Duratons. Estimations must 0e done 0ased on a :B to improve accuracy.
# Cost of quaty: Cost that s ncurred to acheve requred quaty
# Stranded/Sunk Costs: costs ncured that cannot be reversed rrespectve to future events
# Balue Engineering/ 5nalysis: ndng ess costy way to do the same work. E.g. outsourcng
# Marginal analysis: Spend tme on mprovement f t mproves revenues or productvty.
# Order of Magnitude Estimate: Rough Order of Magntude (.OM): -50% to +50% (at Intaton) as the pro|ect moves, estmates shoud become more accurate, 4onceptual Est: -30% to + 50%, Preliminary Est: -20% to
+30%, /eAnitive Est: -15% to +20%, 4ontrol Est: -10% to +15% (for Actvtes wth reatvey few unknowns).
!ypes of costs:
Drect cost: ncude dedcated abor, matera, suppes, equpment, censes,
fees, tranng, trave, or professona servce fees
Indrect cost:Exampe, f a coor prnter s shared by severa pro|ect teams, ts
dmcut to dentvey determne what percentage of costs each shoud share.
Varabe cost: uctuate and can't be predcted wth absoute certanty. For
exampe, trave or transportaton costs that can change dependng upon the
cost of fue or certan commodtes and types of raw materas.
Fxed cost: are statc throughout the pro|ect or have ony a sma kehood of
uctuaton. Fxed costs are usuay for tems such as rents, eases, censes,
saares, and xed fees
-actors aLecting costs:
-Rsks:Durng eary phases, the greatest rsk to budget accuracy s usuay that
the scope, actvty, and constrants arent fuy known
-Tota Cost of Ownershp/Lfe-Cyce:
-Cost of Ouaty: Cost that s ncurred to acheve requred quaty
-Marketpace Condtons:
Accuracy of Estmates:
.ough order of magnitude estimate .OM: ths type of estmate s made
durng ntatng process. Typca range s M/CI& percent from actua.
Budget estimate: ths type of estmate s made durng Pannng phase.
Typca range s C%& to M)I percent from actua.
/eAnitive estimate: Later durng the pro|ect estmates w become more
rened, some PMs use the range of CI to M%& or C/M%&.
1. 5ctivity 4ost Estimates
2. Anaogous Estmatng (Gross Vaue Estmtng apprch)
'op1down estimates are the least accurate
1Bives Project Manager an idea of the level of Management:s
e)pectations
2. Basis of Estimates:
is the supporting detail that provides supplementary information about the activity estimates, such as
any assumptions made, constraints, ho3 the estimate 3as derived, the confdence level in
the estimate, and an& risk factors that were considered
3. Duman .esource Plan: to know labor rates
4. .isk .egister 4. BottomCup Estimating
6. .eserve 5nalysis: +eserve analysis evaluates risks by
making "nancial allowances for them in the projects funding
requirements
1 9udget reserve
1 2ontingency reserves %for known risks&
1 Mgmt reserves %for unknown risks&
7. 4ost of @uality
8. Bendor Bid 5nalysis
/etermine Budget "4ost Performance Baseline$? The process of aggregatng the estmated costs of ndvdua actvtes or work packages to estabsh an authorzed cost basene. Budget, s tme-phased (WHAT costs w be
ncurred and WHEN they w be ncurred). The 4ost Baseline descrbes a detaed budget that shows costs and tmenes for each work package or actvty. It s performed after Dene Actvtes, Estmate Actvty Resources,
Estmate Actvty Duratons, Deveop Schedue and Estmate Costs.
# Larger pro|ects may be dvded nto mutpe Cost Basenes.
The entre estmated cost of the budget, ncudng any contngency or management reserves, s the pro|ect fundng requrements.
Pro2ect funding reHuirements = Pro2ect Bud2et (Pro2ect Base 4ost+.isk response cost|planned|) + .eserve (contigency reserve|known unknowns| + Mgmt reserve|unknowns|)
4ost 5ggregation:
1.Actvty Estmates ->2.Work Package Estmates ->3. Contro Account Estmates ->4. Pro|ect Estmates ->5.Contngency Reserves ->6.4ost Baseline ->7.Mgmt Reserves ->8. 4ost Budget.
At a broad eve, the budgetary casscatons are generay:
ReservesLabor/PersonneProfessona, Contracted, or Outsde
ServcesSuppes, MaterasEqupment, Hardware, and Software Tranng,
TraveLcenses, feesIndrect Costs
You w get questons on the E;5M askng you to seect between pro|ects
usng Net Present Vaue (NPV) or Benet Cost Rato(BCR). Aways choose the
pro|ect wth the B1<<E! 3PB or B4.N
A Management .eserve s money set asde to cover unpanned,
unexpected costs. Your pro|ects fundng requrements need to cover both the
budget n the Cost Performance Basene and the management reserve.
1. 4ost 5ggregation 1. 4ost Performance Baseline ( C curve)
'ime phased funding requirements - the performing organization needs to know when the project will
need money 2. .eserve 5nalysis
2. Pro2ect -unding .eHuirements (Dotted Steps)
5. .esource 4alendars 5. -unding 6imit .econciliation
6. 4ontracts
4ontrol 4osts? The process of montorng the status of the pro|ect to update the pro|ect budget and managng changes to the cost basene.
-Cumuatve CPI: The rate at whch the pro|ect performance s meetng cost expectatons from the begnnng up to a pont n tme. Aso used to forecast pro|ects cost at competon. CPIC (CPI Cumuatve)= EVC (EV Cumuatve)/
ACC (AC Cumuatve) = Whch cacuates the pro|ect's performance up to a pont n tme.
-To-Compete Performance Index (TCPI): performance needed n order to acheve earned vaue targets (ether nanca or schedue). Two forms, TCPIC and TCPIS.
# TCPI (Based on BAC) = Work Remanng .e, (BAC-EV) / Remanng Funds .e., (BAC-AC) (ower than 1 s good)
# TCPI (Based on EAC) = Work Remanng .e, (BAC-EV) / Remanng Funds .e., (EAC-AC) (ower than 1 s good)
# TCPI cacuaton s based on a speced management goa. If the cumuatve CPI fas beow the basene pan, a future work of the pro|ect w beed to mmedatey be performed n the range of the TCPI (BAC) to stay wthn the
authorzed BAC. Once management acknowedges that the BAC s no onger attanabe, the PM w prepare a new EAC for the work, and one approved the pro|ect w work to the new EAC vaue and t supersedes the BAC.
# The EVM method works we n con|uncton wth manua forecasts of the requred EAC costs. The most common EAC forecastng approach s a MANUAL, BOTTOM-UP SUMMATION by the PM and Pro|ect Team.
# Pro|ect Manager montor EV, both ncrementay to determne CURRENT STATUS and cumuatvey to determne ong-term PERFORMANCE TRENDS.
For formuas, refer attached :ord /oc on Earned Balue
1. Earned Balue Management (Varances and Trends) 1. :ork Performance Measurements
2. Pro2ect -unding .eHuirements 2. -orecasting (EAC and ETC) 2. Budget -orecasts
3. :ork Performance 1nformation 3. !oCcomplete Performance 1ndex "TCPI)
5. Bariance 5nalysis
# Lfe Cyce Costng ncudes Acquston, Operaton, Mantenance, and Dsposa Costs.
# The Cost Management Processes and ther assocated toos and technques are usuay seected durng the pro|ect fe cyce denton, and are documented n the 4ost Management Plan (whch has been produced by Deveop
Pro|ect Mgmt Pan Process). For exampe, the Cost Mgmt Pan can estabsh the foowng: 1. Leve of Accurary (Roundng of the data), 2. Unts of Measurement (Stah Hours, Stah Days, Weeks, or Lump Sum), 3. Organzatona
Procedures Lnks (The WBS component used for the Pro|ect Cost Accountng s caed the Contro Account (CA). Each Contro Account s assgned a unque code or account number that nks drecty to the performng organzaton's
Accountng System), 4. Conto Threshods (Threshods are typcay expressed as percentage devatons from the basene pan), 5. Rues of Performance Measurement (EVM rues of performance measurement are set), 5. Reportng
Formats (Formats and frequency of varous cost reports are dened), and 6. Process Descrptons (descrpton of each of the three cost mgmt processes are documented).
# !he cope tatement provdes the Product Descrpton, Acceptance Crtera, Key Deverabes, Pro|ect Boundares, Assumptons, and Constrants about the Pro|ect.
# Pro2ect 4ost 4ontrol ncudes:
1) Inuencng the factors that create changes to the authorzed cost basene,
2) Ensurng that a change requests are acted on n a tmey manner,
3) Managng the actua changes when and as they occur,
4) Ensurng that cost expendtures do not exceed the authorzed fundng, by perod and n tota for the pro|ect,
5) Montorng cost performance to soate and understand varances from the approved cost basene,
6) Montorng work performance aganst funds expended,
7) Preventng unapproved changes from beng nuded n the reported cost or resource usage,
8) Informng approprate stakehoders of a approved changes and assocated cost, and
9) Actng to brng expected cost overruns wthn acceptabe mts.
There are a few numbers that w appear on the test as dentons. You wont need to cacuate these, but you shoud know what each term means.
BeneAt cost ratio (BCR): Ths s the amount of money a pro|ect s gong to make versus how much t w cost to bud t. Generay, f the benet s hgher than the cost, the pro|ect s a good nvestment.
3et present value (NPV): Ths s the actua vaue at a gven tme of the pro|ect mnus a of the costs assocated wth t. Ths ncudes the tme t takes to bud t and abor as we as materas. Peope cacuate ths number to see f
ts worth dong a pro|ect.
Opportunity cost: When an organzaton has to choose between two pro|ects, they are aways gvng up the money they woud have made on the one they dont do. Thats caed opportunty cost. Its the money you dont get
because you chose not to do a pro|ect.
Exampe -- If a pro|ect w make your company $150,000, then the opportunty cost of seectng another pro|ect nstead s $150,000 because thats how much your companys mssng out on by not dong the pro|ect.
1nternal rate of return? Ths s the amount of money the pro|ect w return to the company that s fundng t. Its how much money a pro|ect s makng the company. Its usuay expressed as a percentage of the fundng that has
been aocated to t.
/epreciation? Ths s the rate at whch your pro|ect oses vaue over tme. So, f you are budng a pro|ect that w ony be marketabe at a hgh prce for a short perod of tme, the product oses vaue as tme goes on.
6ifecycle costing? Before you get started on a pro|ect, ts reay usefu to gure out how much you expect t to cost-not |ust to deveop, but to support the product once ts n pace and beng used by the customer.
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4. Benchmarkng
6. Organzatona Process Assets 5. Pro|ect Document Updates
7. Enterprse envronmenta factors 6. Statstca Sampng
8. Propretary Ouaty Management Methodooges
9. Addtona Ouaty Pannng Toos
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1. Pro|ect Management Pan (O M P & Process Imp P)
2. Pro|ect Management Pan Updates
3. Ouaty Contro Measurements 3. Pan Ouaty and Perform Ouaty Contro Toos 3. Pro|ect Document Updates
and Technques 4. Organzatona Process Assets Updates
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1. Pro|ect Management Pan (O M Pan)
2. Ouaty Metrcs
3. Ouaty Checksts
4. Hstogram
5. Pro|ect Management Pan Updates
6. Work Performance Measurements 6. Pro|ect Document Updates
7. Organzatona Process Assets 7. Organzatona Process Assets Updates
8. Statstca Sampng
9. Inspecton
10. Approved Change Requests Revew
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Plan @uality? The process of dentfyng quaty requrements and/or standards for the pro|ect and product, and documentng how the pro|ect w demonstrate compance.
Decsons made about quaty can have a sgncant mpact on other decsons such as scope, tme, cost, and rsk. Most Pro|ect Management Practtoners vew SCOPE and OUALITY as
INSEPARABLE. # If Ouaty Pocy doesn't exst, the Pro|ect Team shoud wrte one for ths pro|ect. "Determne WHAT the quaty standards for the pro|ect w be and document HOW the pro|ect
w be measured for compance".
@U561!E? s dened as degree to whch your pro2ect fulAlls reHuirements. Customer satsfacton, Ftness for use, Conformance to requrements
# Cost benet: Lookng at how much your quaty actvtes w cost. # Benchmarkng: means usng the resuts of quaty pannng on other pro|ects to set goas for your own.
# Desgn of experments: s the st of a the knds of tests you are gong to run on your product.
# Attrbute Sampng :s bnary, t ether conforms to quaty or t doesnt (YES or NO). # Varabe Sampng: Measures how we somethng conforms to quaty (RANGES).
# Speca Causes: considered unusual and preventa0le 0y process improvement. # Common Causes are generay acceptabe.
# Toerances dea wth the mts your pro|ect has set for product acceptance. # Contro Lmts are set at three standard devatons above and beow the mean. As ong as your resuts fa wthn
the contro mts, your process s consdered to be n contro. ## Toeranes focus on whether the product s acceptabe, whe Contro Lmts focus on whether the process tsef s acceptabe.
# Contro Charts: The upper and ower contro mts are set at THREE STANDARD DEVIATIONS ABOVE and BELOW MEAN. # .ule of even: If seven or more consecutve data ponts fa on one
sde of the mean, they shoud be nvestgated. Ths s true even f the seven data ponts are wthn contro mts.
@uality metrics? denes how O w be measured. Ouaty metrcs can ncude any type of appcabe measurements,
ncudng defect rates, bug rates, faure rates, up-tme, reabty, and coverage area.
4ost of <ood @uality (cost of conformance)
Preventon Costs Ouaty management actvtes, such as tranng and process documentaton, and checkst deveopment.
Apprasa Costs Ouaty assurance actvtes, ke apprasas and audts Ouaty contro actvtes, ke testng and
nspectons.
4ost of Poor @uality (cost of nonconformance)
Interna Faure Costs
Faures found by the pro|ect team, ncudng the costs reated to re|ects, rework, deays, shortages, scrap, and other
nemcences.
Externa Faure Costs
Faures found by the customer, ncudng costs reated to warrantes, returns, ost saes, and ost good w
CostC0eneAt analysis: determne the approprate trade-oh between quaty and the cost to acheve that eve of quaty.
The goa of meetng the quaty requrements s to reduce costs through ess rework and hgher productvty, but there are
costs assocated wth meetng the quaty requrements, and what we want to nd s the agreeabe eve between quaty
requrements and the costs assocated wth meetng those requrements.
Marginal analysis: As we strve for mprovng products and processes, we don't want to exceed a pont beyond
(unnecessary quaty) whch the costs of the mprovements aren't ohset by the antcpated ncrease n revenue (saes or
prots).
8ust 1n !ime "81!$: To reduce expensve cost of hodng nventory, many companes decrease nventory cose to zero. A
company usng |IT must have hgh quaty practces.
Benchmarking compares smar processes between dherent organzatons, hepng to generate deas for mprovement and
to provde a measurement bass by hepng the organzaton determne what the "standard" s.
-orce Aeld analysis? ads n vsuazng the pro and con forces nvoved n an ssue or stuaton. The premse behnd ths
technque s that a stuaton s hed n equilibrium by two sets of opposng forces. 3riving forces are those strvng for
change, and restraining forces are those desrng the status quo. A stuaton can change ony when the strength of the
drvng forces exceeds the restranng forces. By concentratng on the core factors gvng strength to the restranng forces,
the desred change can proceed.
/esign of experiments? Desgn of experments s a statstca method that can hep make processes and products more
emcent by mathematically simulating changes a at once to the varabes ahectng the process.
<old Plating: s often the teams mpresson of what s vaued by the customer, and the customer mght not agree.
Remember that @U561!E MU! BE P6533E/ 13, 3O! 13PE4!E/ 13.
@uality means that somethng does what you needed t to do. <rade descrbes how much peope vaue t. Increase n
Ouaty can resut n increased productivity, cost eLectiveness and decreased cost risk.
peciAcation 6imits: whe control limits represent the performing organisations standards for quaty, the speci"cation
limits represents the customers e)pectations or contractua requrements. To meet customers speccaton mts, the
performng orgs contro mts must be strcter than those of the customer. Therefore, on the exam, assume that speci"cation
limits are outside the upper and lower control limits.
1. takeholder .egister 1. 4ostCBeneAt 5nalysis:is looking at how much your quality
activities will cost versus how much you will gain from doing
them
1. @uality Management Plan:
'he Puality Management Plan is the main tool for
preventing defects on your project #t includes;
1.ualit& standards that apply to the project
1who will be involved in managing Puality
1the meetings to be held for addressing quality
1the reports that will address quality
1what metrics will be used to measure quality
1what parts of the project will be measured and when
2. cope Baseline
%approved project scope statement, !9/, and !9/ dictionary&
2. 4ost of @uality:
Puality involves costs, and the cost of quality quanti"es this
cost 'he cost of quality has two main components Qthe cost
of conforming to quality requirements and the cost of not
conforming to quality requirements 'he cost of conformance
should be lo3er than costs of non1conformance
3. 4ost Performance Baseline 3. 4ontrol 4harts: is a type of run chart that is used to
determine whether a process is in control or out of control A
run chart is a line graph that displays measurements taken
over time, and with the addition of upper and lower control
limits, the chart shows at what points in time measurements
e)ceeded thresholds
2. @uality Metrics %3e"nes how P will be measured& are the
speci"c quality goals the project must meet and how the quality
control processes will con"rm compliance #t can include any type
of applicable measurement, including defect rates, bug rates,
failure rates, etc
4. chedule Baseline:
is the approved project schedule #t has the start and "nish
dates for all project activities, which impact quality
requirements
4. -lo#charting: means coming up with a graphical depiction
of the the process youre doing so that you can anticipate
where quality activities might help you prevent defects
3. @uality 4hecklists %?to1do? lists that ensure that everything is
performed and in the correct order&
5. .isk .egister 4. Process 1mprovement Plan
5. /esign of Experiments (DOE)
Perform @uality 5ssurance? The process of auditing the quaty requrements and the resuts from quaty contro measurements to ensure approprate quaty standards and operatona
dentons are used. "Use the measurements to see f the quaty standards w be MET; VALIDATE the standards".
Perform Ouaty Assurance s for determnng "5re #e using the tandards" and "4an #e improve the tandards"
# Imp Pont: Perform Ouaty Assurance s prmary concerned wth overa P.O4E 1MP.OBEME3!. It s 3O! about nspectng the product for quaty or measurng defects. Instead,
Performance Ouaty Assurance s focused on steady mprovng the actvtes and processes undertaken to acheve quaty.
# Proactve steps taken by PM and the mgmt team to nsure the quaty standards are beng hep and montored.
Thus quaty assurance s focused on the processes and not the quaty of the deverabes. Ths s mportant for us to
remember: quaty assurance s concerned wth .ualit& processes whe quaty contro s concerned wth .ualit&
deliverables.
1. @uality 5udits %;e& 2ool&;
Ansure that the project is complying with its own quality
policy
1. 4hange .eHuests (for Procedura Changes)
2. @uality Metrics (Denes how O w be measured) 2. Process 5nalysis:
involves techniques which e)amine the project:s processes,
looking for any non1value added activities %ineLciencies&
Process analysis techniques implement the continuous
improvement plan
4. :ork Performance 1nformation:
!ork performance information is any data that can be
considered related to the work which produces the project
deliverables A)amples are schedule and progress status
information, budget and cost status, quality status, estimates
to complete, resource utilization information, and lessons
learned
Perform @uality 4ontrol? The process of montorng and recordng resuts of executng the quaty actvtes to assess performance and recommend necessary changes. Ths process uses the
too of INSPECTION to make sure the resuts of the work are what they are supposed to be. Perform Ouaty Contro s the process where each deverabe s 13PE4!E/, ME5U.E/, and
!E!E/. Ths process makes sure that everythng produced meets quaty standards. "Perform the MEASUREMENTS and COMPARE to specc quaty standards; IDENTIFY ways of emnatng the
probem n the future".
# 4ause and ELect /iagram "1shika#a/-ish0one$: Used to show how dherent factors reate together and mght be ted to potenta probems. It mporves quaty by dentfyng quaty
probems and tryng to UNCOVER THE UNDERLYING CAUSE.
# -lo# 4hart: Shows HOW PROCESSES INTERRELATE.
# Distogram "4olumn 4hart$: It shows HOW OFTEN somethng occurs, or ts FREOUENCY (no Rankng).
# Pareto 4harts "P&C)& rule$: Ths s a Hstogram showng defects RANKED from GREATEST to LEAST. Ths rue states that 80% of the probems come from 20% of the causes. It s used to hep
determne the FEW ROOT CAUSES behnd the MA|ORITY OF THE PROBLEMS on a pro|ect.
# .un 4hart: te about TRENDS n the pro|ect. Shows the HISTORY and PATTERN.
# catter /iagram: It s powerfu too for SPOTTING TRENDS n Data. Scatter Dagrams are made usng two varabes (a dependent varabe and an ndependent varabe).
# tatistical ampling: It s a powerfu too where a RANDOM sampe s seected nstead of measurng the entre popuaton.
Perform @uality 4ontrol makes sure that the pro|ect's deverabes compy wth the quaty requrements and prevents
non-compance ssues from recurrng.
@uality control terminology:
-- Prevention: Preventon actvtes nvove ookng at processes for factors that can potentay ead to defects, and when
defects are detected, determnng the root causes so that those factors can be mtgated.
-- 1nspection actvtes are the testng, measurement, revew, and examnaton of the deverabe to determne whether t's
n compance wth the quaty requrements.
-- 5ccuracy and precision? Accuracy descrbes how cose a measurement s to ts true vaue whe precson descrbes how
repeatabe the measure s and how many sgncant dgts ts measured n.
-- !olerances are the acceptabe varatons n mts, such as a uorescent ght bub shoud burn between 4000 and 5000
contnuous hours. They dene the maxmum varatons from a nomna vaue that are acceptabe because they w have a
neggbe ehect on the quaty eve.
-- pecial and common causes? A special cause s an unusua event outsde of the process that eads to a measurabe
change n the process. Though unusua, speca causes are considered preventa0le. For exampe, a backup generator
faed to start up durng a power faure. The faure of the backup generator can be prevented n the future through reguar
mechanca mantenance and operatona tests.
A common cause s a norma event wthn the process that eads to a measurabe change n the process. Common causes
resut n rare, but toerabe varatons. Even f t were possbe to remove a possbe common causes from a process, the
ehort to do so woud usuay be cost prohbtve. Common causes are thus generay consdered as nonCpreventa0le and
accepted as part of the process.
For exampe, ets magne that about one screw out of every 50,000 from a supper s msthreaded. When a manufacturng
process encounters one of these msthreaded screws, t causes a |am n the machne whch must be manuay removed. The
|am woud resut n a measurabe change n the process (seen as decrease n producton), but snce t woud be cost
prohbtve to have a screws ndvduay nspected before they were used n the manufacturng process ths s consdered
an unpreventabe cause.
-- 4ontrol limits? are the upper and ower mts set for a process, usuay at three standard devatons from the mean, and
determne whether a process s n contro or out of contro
-- tatistical sampling s a broad term that nvoves choosng random, representatve sampes for testng rather than
testng each ndvdua deverabe.
-- tandard deviation and igma values: Standard devaton s used to measure how data s organzed. For the PMP
examnaton, we shoud know the basc standard devaton formua, the concept of standard devaton and what t's used
for, and the four sgma vaues for normay dstrbuted data.
Standard devaton formua s the resut of the optmstc estmate subtracted from the pessmstc, dvded by sx:
= (Pessmstc Estmate - Optmstc Estmate) / 6
1 sgma -- 68.25%
2 sgma -- 95.46%
3 sgma -- 99.73%
6 sgma -- 99.99%

--catter charts hep you ook at the reatonshp between two dherent knds of data.
Exam potlight
Dont confuse nspecton wth preventon; theyre two dherent toos. 1nspection keeps errors n the product from reachng
the customer. Preventon keeps errors from occurrng n the process.
1. 4ause and ELect /iagram (Ishkawa/Fshbone) 1. @uality 4ontrol Measurements:
are a of the resuts of your nspectons: the numbers of defects
youve found, numbers of tests that passed or faed-stuh ke
that
2. 4ontrol 4harts 2. Balidated 4hanges
3. -lo#charting:
Clowcharts help you get a handle on how processes work by
showing all of the decision points graphically
3. Balidated /elivera0les
4. /elivera0les 4. 4hange .eHuests
5. 5pproved 4hange .eHuests 5. Pareto 4hart: Pareto charts go together with the
IR47R rule #t says that IR percent of the
problems youll encounter in your project
are caused by 7R percent of the root causes
you can "nd Pareto charts plot out the frequency of defects
and sort them in descending order
1helps focus attention on most critical issues
1priortize potential causes of the problem
1separate the critical few from the uncritical many
6. .un 4hart:
+un charts are used to show variations in the process over
time or to sho3 trends %such as improvements or lack of
improvements& in the process #n a run chart, you are looking
for trends in the data over time
7. catter /iagram:
/catter charts help you look at the relationship between two
di0erent kinds of data
Exam potlight
The most mportant fact you shoud know about the Verfy Scope
process s that Verfy Scope formazes the acceptance of the
pro|ect scope and s prmary concerned wth the acceptance of
work resuts. Dont confuse ths process wth the Perform Ouaty
Contro
process. You can remember the dherence between Verfy Scope
and Perform Ouaty Contro ths way:
-- Perform Ouaty Contro = checkng for correct work resuts and
assurng that the quaty requrements are met
-- Verfy Scope = acceptng work resuts
# Pan Ouaty, Perform Ouaty Assurane, and Perform Ouaty Contro map cosey to the PlanC/oC4heckC5ct cyce as descrbed by W. Edwards /eming (He aso deveoped 14 actvtes for
mpementng quaty). # Php 4ros0y, smar to Demng, he too deveoped 14 Steps to mprovng quaty. # |oseph 8uran? Ftness-for-use, 8uran !rilogy (Ouaty of Desgn, Ouaty of
Conformance, and Ouaty Characterstcs), |uran Trogy approach PlanC1mproveC4ontrol. # Dr. Gench !aguchi deveoped the concept of '6oss -unction'.
# Investment n Ouaty s usuay born by the Organzaton (not by the pro|ect). # PlanC/oC4heckC5ct has been dened by DE:D5./ and moded by /EM13< n ASO Handbook.
# Ouaty s Uthe degree to #hich a set of inherent characteristics fulAll reHuirementsNU
# !otal @uality Management "!@M$: Everyone n the company s responsbe for quaty and s abe to make a dherence n the utmate quaty of the product. TOM shfts the prmary quaty
focus away from the product that s produced and ooks nstead at the underyng process of how t was produced.
# Contnuous Improvement Process (CIP)/KAIZEN: A phosophy that stresses constant process mprovement, n the form of sma changes n products or servces.
# |ust-In-Tme (|IT): A manufacturng method that brngs nventory down to Zero (or near Zero) eves. It forces a focus on quaty, snce there s no excess nventory on hand to waste.
J V %W Q 'PN)I( V )W Q ,INF'( V *W Q ,,N+*( V 'W Q ,,N,,,''(
# ISO 9000: Ensures Companes document what they do and do what they document. It may be an mportant component of Performance Ouaty Assurance, snce t ensures that an organzaton
foows ther processes. # Mutuay Excusve: one choce excudes the other. # CMMI: Denes the essenta eements of ehectve processes.
# Statstca Independence: When the outcomes of two processes are not nked together or dependent upon each other, they are statstcay ndependent.
# Sx Sgma: Sx sgma quaty strves to make the overwhemng ma|orty of the be curve fa wthn customer quaty mts. Sx sgma s a quaty management phosophy that sets very hgh
standards for quaty, and that one sgman quaty s the owest quaty eve, aowng 317,500 defects per 1,000,000 outputs, three sgma quaty s hgher, aowng 2,700 defects per 1,000,000,
and sx sgma s the hghest of these, aowng ony 3.4 defects per 1,000,000. Pharmaceutca Industry, the Arne Industry, and Power Uttes typcay strve for hgher eves of quaty than sx
sgma woud specfy n some areas of ther operatons.
DUM53 .EOU.4E
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3. Organzatona Process Assets 3. Pro|ect Management Pan Updates
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of all team members& 2. Team-budng Actvtes
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1. Pro|ect Management Pan
2. Pro|ect Management Pan Updates
3. Organzatona Process Assets Updates
4. Enterprse Envronmenta Factors Updates
5. Organzatona Process Assets 5. Interpersona Sks
# PM's Stye of Leadershp over Pro|ect Tmene: . Drectng Leader, . Coachng Leader, . Factatng Leader, and v. Supportng Leader
# Stamng Mgmt Pan ncude: 1.Stah acqustons, 2.Resource caendars/hstogram, 3.Stah reease pan, 4.Tranng needs, 5.Recognton & Rewards, 6.Compance, and 7.Safety.
l
J <"roup; A small group of people with complementary skills and abilities who are committed to a leader:s goal and approach and are willing to be held accountable by the leader
<2eam5 A small group of people with complementary skills and abilities who are committed to a common goal and approach for which they hold each other accountable
------------------------------1nterpersonal po#er 0ases? CCCCCCCCCCCCCCCCCCCCCCCCCCCCCC
=egitimate >:ormal?5 Also known as formal or normative power, this type of power comes from one:s position, title, or hierarchy #n a matrixed organi$ation, the project manager doesnt have legitimate po3er, because the team doesnt directly report to the project manager
Expert5 'his type of power comes from one:s knowledge, e)pertise, skills, talents, or e)perience
,e3ard5 'his type of power comes from one:s ability to bestow desired rewards to others
Coercive5 'his type of power comes from one:s ability to apply negative in(uences, such as punishments, on others
,eferent5 'his type of power comes from one:s charisma, personality, or hero4heroine status
,e3ard and expert are the interpersonal powers favored by PM#
:-,MA=, ,E(A,*, PE0A=2@ are powers derived from pro%ect managers position in the company
------------------------------6eadership styles?CCCCCCCCCCCCCCCCCCCCCCCCCCCCCCCCCCCC
AAuthoritarian5 'he leader is in total control, relying only on his or her judgment, arbitrarily making decisions, and generally sharing information only on a need1to1know basis
A*emocratic5 'he leader seeks input and involvement from the group as part of the decision1making process and openly shares information with the group
A=aisse$1faire5 'he leader turns nearly all control over to the group and is generally absent 'he leader is likely to share information only when directly asked for it
------------------------------6eadership theories?CCCCCCCCCCCCCCCCCCCCCCCCCCCCCC
2heor& 1B2heor& @5
++2heor& 1, managers believe that employees show little ambition and will avoid responsibility unless they are constantly monitored, and that they care very little about their work product and are motivated to do it well only through strong controls, coercion, and the threat of punitive measures A manager
subscribing to this viewpoint is likely to rely on an authoritarian leadership style
++2heor& @, managers believe that employees are generally ambitious and self1motivated if given the chance, and that they feel a sense of pride in their work and are motivated b& the feeling of a %ob 3ell done A manager subscribing to this viewpoint is most likely to rely on a democratic and in some cases a
laissez1faire leadership style
++2heor& C, managers believe that employees are motivated b& stabilit&, longevit&, and involvement in the decision+making process 'hings such as life+career balance, collective decision making, and long+term emplo&ment are characteristics of a 2heor& C organization A manager subscribing to
this viewpoint is likely to rely on a democratic leadership style
111111111111111111111111111111Management / =eadership st&les;111111111111111111111111111111111111
*irecting5 telling others 3hat to doD
:acilitating5 coordinating the input from others
Coaching5 in this managers helps others achieve their goals
#upporting5 involves providing assistance along the 3a&
Autocratic5 in this manager has power to do whatever he wants 'he manager may coach or delegate, but everyone is doing what manager wants them to do
Consultative5 'he manager obtains other opinions and acts as servant for the team
Consultative+Autocratic5 manager solicits inputs from team members, but retains decision making authorit& for himD
Consensus5 involves problem solving in group, making decisions based on group agreement
*elegating5 in this manager establishes goals and then gives team sucient authorit& to complete the 3orkD
)ureaucratic5 this style focuses on following procedures e)actly
Charismatic5 these managers energi$e and encourages team in performing pro%ect 3orkD
*emocratic or Participative; involves encouraging team participation in decision making process
=aisse$+faire; this manager is not directl& involved in the 3ork of the team, but manages and consults as necessar&D this st&le is appropriate 3ith a highl& skilled teamD
111111111111111111111111111111,oles / ,esponsibilities;111111111111111111111111111111111111
,ole of Pro%ect #ponsor;
1is one who provides "nancial resources for the project
1Approves the "nal project plan
1protects the pro%ect from outside infuences and changes
1+esolves con(icts that e)tends beyond project managers control
1Provides formal acceptance of the deliverables
/evelop Duman .esource Plan? 'he process of identifying and documenting Project +oles, +esponsibilities, and +equired /kills, +eporting +elationships, and creating a /ta0 Management
Plan 'he @+ Plan documents project ,oles and ,esponsibilities, Por%ect -rgani$ation Charts, and the #tang Management Plan including the 'imetable for /ta0 Acquisition and
+elease #t may also include #denti"cation of 'raining =eeds, 'eam19uilding /trategies, Plans for +ecognition and +ewards Programs, 2ompliance 2onsiderations, /afety #ssues, and the
#mpact of the /taLng Management Plan on the .rganization
''5; 'hree Primary Cormats are 5 @ierachical, 7 Matri) %+AM 1 +esponsibility Asssignment Matri), which displays work packages in the rows and roles in the columns 1 Popular 'ype is +A2#
chart 1 +1+esponsible< A1Accountable< 212onsult< #1#nform #t is important when team consists of #nternal and A)ternal +esources&, and D 'e)t %Sob4Position 3escriptions and +ole1
+esponsibility1Authority Corms 1 'his tool is prticularly useful in +ecruiting& ''7; Cor understanding .rganizations and 'eams behavior
''D; =etworking is the process of communicating with others within your ?=etwork? of contacts 1 9y networking within the organization, PM can understand the political and .rganizational
Corces that will in(uence the project @+ =etworking activities include Proactive 2orrespondance, 6uncheon Meetings, #nformal 2onversations including Meeting and Avents, 'rade
2onferences, and /ymposia #t can be a useful technique at the beginning of a project
.5; ,esource Eistogram 1 shows the resource usage for a given period of time #t illustrates the number of hours a person, department, or entire project team will be needed each week or
month over the course of the project
@uman resource management plan;
1+#ta9 ac.uisition procedures; staLng management plan describes how and through what methods the people needed for
the project will be acquired, which may include both personnel internal to the performing organization and e)ternal to it, such
as consultants
11,esource timetables, calendars, histograms; human resource plan includes information on when resources will be
needed and in what durations, shown through calendars, timetables, and histograms
T,esource calendars show when roles or personnel will be needed by the project, including e)pected working hours,
holidays, shifts, or other important information the project sta0 will need to know #t is also applicable to non1human resources
As part of procurement activities, those resources are added to the calendar, showing e)pected arrival dates, general
availability, hours of access, and quantities available
T,esource histograms that show the work units by time period that a role, person, or department will provide to the
project
112raining; 'he human resource management plan includes the formal plan for project team member training .nly the
training required by the project team is addressed by the plan !e shouldnt confuse it with whatever training plan might be
required for stakeholders in the use of the projects deliverables
Cor e)ample, if the customer will require training sessions on how to use a software application created by the project, that
training %and whatever activities it may require& are treated as a project deliverable
11Compliance and safet&5 'he human resource management plan also describes any measures that will be taken to ensure
that any safety, governmental, regulatory, organizational, or contractual obligations are followed that are applicable to human
resource requirements
112eam performance assessments;'he human resource management plan will include any team performance goals, and
how the overall performance of the project team will be measured and evaluated
11Pro%ect performance appraisals; 'he human resource management plan will include the procedures, methods, and
guidelines for the performance appraisal of individual project team members
11,ecognition and re3ards; 'he human resource management plan details the approaches that will be taken for promoting
and reinforcing desired behavior, including the costs associated with any recognition or reward program
11#ta9 release criteria; 'he staLng management plan describes how team members will be released from the project 'eam
members are released from the project when their work is completed or when other une)pected reasons occurs
T #tang Mgmt Plan include; 5/ta0 acquisitions, 7+esource calendars4histogram, D/ta0 release plan, E'raining needs,
F+ecognition M +ewards, G2ompliance, and H/afety
'here are lots of 3a&s to record and communicate roles and responsibilities, including +AM, organisation breakdown
structures, resource breakdown structures, position descriptions
1. 5ctivity .esource .eHuirement:
'he activity resource requirements document describes the
resource needs at the activity level #t focuses on the
resource types and quantities needed, and it helps determine
the competencies that will be needed for the project
1. Organi7ation 4harts and Position /escriptions:
'hese documents describe the project roles, hierarchy,
reporting relationships, and responsibilities 'hey include
project organization charts, position descriptions, role1
responsibility1authority forms, +AMs, and +A2#s
1. Duman .esource Plan - #t has three componenets
a ,oles and ,esponsibilities; outlines every unique project
role and includes each roles authority, skills needed, and
responsibilities
A ,AM %,esponsibility Assignment Matri)& shows by activity
what role is responsible, and as people are assigned to roles
their names are added to the table A ,ACI %pronounced ray1
cee& is a type of +AM that derives its name from the
responsibility designation that:s given to each role4activity
combination;
,F,esponsible; 'he role is primarily responsible for
performing the work required of that activity
AFAccountable; 'he role is held accountable for the
activity:s output, deliverable, or artifact
CFConsult; 'he role is in an advisory position for the activity
IFInform; 'he role will be kept in the loop as the activity is
underway
b -rgani$ation Charts
c 2he #tang Management Plan; describe how the
project will be sta0ed, and how the project team will be
trained, evaluated, compensated, rewarded, and released
from the project
2. Enterprse Envronmenta Factors: company culture or
e)isting systems that project will have to deal with
2. Organi7ational !heory:
'hese are sociological, behavioral, and psychological theories
that describe how individuals, teams, groups, and other
organizational units behave
3. 3et#orking:
=etworking involves the formal and informal interaction
between others in the enterprise, profession, or industry
=etworking includes conferences, electronic communities,
luncheons, trade groups, and seminars
5cHuire Pro2ect !eam? process results in personnel 0eing assigned to the roles needed in order for the pro2ect #ork to 0e performed.
TT1: Pre-Assgnment: Occasonay specc resources w be Pre-Assgned to a roe. Ths may occur before the Human Resource Pan has been created and even before the pro|ect
formay begns. TT2: Negotaton: It s an mportant sk for PM to cutvate. TT3: Aquston: It refers to ookng outsde the organzaton for resources when they cannot be provded by your
organzaton. TT4: Vrtua teams are when a team members dont work n the same ocaton.
You shoud read the the phrase "Acqure Pro|ect Team" as "Acqure -1356 pro|ect team":
Acquire Project 'eam invloves;
5 knowing which resources are pre1assigned and con"rming their availability
7 0egotiating for the best possible resources
D Eiring ne3 emplo&ees
E @iring through contracting
F Managing the risk of resources becoming unavailable
Ealo E9ect; 8ou are a great programmer 'herefore we will make you a project manager and e)pect you to be great at that as
well
1. Pro2ect Management Plan 1. PreC5ssignment 1. Pro2ect taL 5ssignments : s a stng of whom s
fung what pro|ect roes
2. 3egotiation (Key Technque of ths process) 2. .esource 4alendars
3. 5cHuisition
4. Birtual !eams
*evelop Pro%ect 2eam5 2he process of improving the competencies, team interaction, and the overall team environment to enhance pro%ect performance ?Project
Management /kills, 6eadership /tyles, Power, 'eam 9uilding and the Motivation of people are all concepts that fall into this process?
Cive kinds of powers; +eward power, A)pert power, +eferent power, Punishment power %2oercive&, and legitimate power %Cormal power& 1 +eward and A)pert as the most e0ective forms of
power and Punishment42oercive as the least e0ective
+ecognition and +eward %'heories of Motivation& 1 !in1win rewards as the best choices for team building
U Maslo3Gs hierarch& of needs 1 Maslow presented a hierarchy of de"ciency needs that must be met in order for a person to reach his or her pinnacle #n most cases, each lower need
must be met before the ne)t level of satisfaction can be achieved, and previously satis"ed needs are no longer motivating factors for the person
=-(E, needs;
5 Ph&siological 0eeds; Cood, water, air, shelter
7 #ecurit&B#afet&5 #tabilit& %political, environmental, "nancial&, personal safety, health
D Acceptance4/ocial; Criendship, community, family, intimacy
EI"EE, =eeds
E Esteem; +espect from others, respect of others, self1respect
F #elf+Actuali$ation; is when a person reaches a need for constant personal growth and improvement 'o reach and continue self1actualization, Maslow found that two additional
factors had to be present;
UCognitive stimulation; #ntellectual stimulation, access to knowledge
UAesthetic stimulation; Access to imagery, beauty, and art
Characteristics of self+actuali$ing people5
U 3on:t deny or avoid facts U A0ective perception of reality U /pontaneous in ideas and actions U 2reative U Problem1solving U /ocial interest in other people
U .bjective U 'rusting U Acceptance of others U #ndependent with a need for solitude
U Eer$bergGs Motivation+E&giene 2heor&; @ygiene factors %2ompany Policy, /upervision, Bood relationship with boss, working conditions, Paycheck, Personal life, /tatus, /ecurity, and
+elationship with co1workers& does not make someone satis"ed, but their absence will make someone unsatis"ed @ygiene factors do not motivate by themselves Motivation factors
%Achievement, +ecognition, !ork, +esponsibility, Advancement, and Browth& will motivate, but they will not work without the @ygiene factors in place /o to really motivate team members,
we need to eliminate job dissatisfaction factors while also providing motivating factors, such as recognition and giving team members activities that are challenging and stimulating
U !ictor !roomGs Expectanc& 2heor&; #f workers believe their e0orts are going to be successful and rewarded, they will tend to be highly motivated and productive @e suggested that
employees are really motivated by goals only when three beliefs are present;
UJalence; 'he person wants to achieve the goal
UA)pectancy; 'he person believes it:s possible to attain the goal
U#nstrumentality; #nstrumentality is a judgment the person makes about whether he or she believes that the reward will be given
U *avid Mc=ellandGs Achievement 2heor&>2heor& of three needs?; this 'heory says that people need achievement, power, and aLliation to be motivated
11 Achievement is when someone performs well and is recognized for it
11 Po3er means he or she has a lot of control or in(uence in the company
11 And someone feels a strong sense of Aliation from being a part of a working team and having good relationships with coworkers
U *ouglas Mc"regorGs 2heor& 1 and 2heor& @;
'heory V 1 'eam members are /el"sh, >nmotivated, 3islike work %constant supervision is required 1 :authoritarian management: style& 'heory 8 1 =aturally motivated to do good work
%manager trusts team members 1 :participative management: style&
U 3r !illiam .uchis 'heory of Q *W 'heory,; Productivity can be increased by how well the workers and management get along and trust each other Sapanese style of management
U 2ontingency 'heory %Cred A Ciedler&; #n stressful times, a task1oriented leader will be more e0ective, while in relatively calm times a relationship1oriented leader will function more
e0ectively
U @ersey and 9lanchard:s 6ife 2ycle 'heory; 6eadership style must change with the maturity of individual employees 'he PM:s style should move from *irecting, to Coaching, to
#upporting, 2hen to *elegating as the project moves through its life cycle
2eam formation stages;
1T1:orming;
2haracteristics; Broup members may be shy or uncomfortable among each other, and everyone is usually on his or her best
behavior Crom each individual:s standpoint, they:ve been brought together by management and not because they share any
common goals Members are usually hesitant to speak openly of ideas or opinions
6eadership; 'he leader needs to set clear, broad e)pectations for the group without speci"cally telling the group how to get
there 'he leader should facilitate group interaction and development of trust, such as through project planning activities, and
by establishing ",-H0* +>6A/, goals, milestones, approaches, and objectives 'he leader needs to stay closely involved and
set an e)ample of e)pected and acceptable behavior
1T1#torming;
2haracteristics; 2on(ict is common as group members begin to e)press ideas and opinions but do not yet fully trust each
other:s motives 2on(ict may cause some group members to withdraw while it may make others hostile and vocal /ome
members may be apprehensive, an)ious, or nervous about the group being able to meet its goals, and work progress is slow
6eadership; 'his is the most diLcult time for the team, so the leader needs to stay involved and facilitate healthy con(ict
resolution when needed #t:s very important for the leader to set an e)ample of trust, tolerance, patience, and to remain
realistically upbeat #f ground rules aren:t followed and the team doesn:t correct the situation on its own, the leader should
return the group back to a discussion on its ground rules
1T10orming;
2haracteristics; 'he group begins to develop trust and grows comfortable with each other 'he "rst signs of community and
interdependence are shown 2ollaboration, rather than individual e0orts, begins to show Motivation and productivity increase
and a sense of common spirit appears
6eadership; 'he leader needs to stay involved, but he or she should continue e0orts to let the team begin holding itself
accountable and making its own decisions 'he leader should move predominantly into a facilitator role 'here are two things
the leader needs to watch for;
U2liques; !hile not always unhealthy, subgroups within the team can disrupt the whole team if they develop too much
autonomy, power, or in(uence
UBroupthink; Broups may slip into such a comfortable and trusting state that the members begin to think alike and stop
questioning each other 'his can lead to poor decisions or missed opportunities, which is a very dangerous state for the group
'he leader may have to "nd healthy ways to de1normalize the team, such as by introducing new team members into the mi)
1T1Performing;
2haracteristics; 'he team is performing at its highest and most productive levels, and it does so naturally and instinctively
Members have a strong sense of reliance on each other and trust #deas and opinions are openly shared, and as a result
innovation and creativity in the team:s approaches and solutions are evident
6eadership; 'he team is self1directing, self1managing, and holding itself accountable 'he leader can focus on facilitation when
needed, and rewarding and recognizing the team to maintain its motivation
1T1Ad%ourning;
2haracteristics; #ts when the team has accomplished its goals and is disbanding /ome have also proposed a ?transforming?
stage in which the team identi"es new goals to tackle and thereby transforms its goals and purpose
6eadership; Cor the project management team, this stage will occur during phase project closure 'he leader needs to ensure
team1formation lessons learned are documented and that recognition to the team is given 9ecause the team has developed
personal bonds, opportunities for socializing during the project closure should be provided
1. Pro2ect taL 5ssignments %will have list 1. !raining 1. !eam Performance 5ssessments
'eam performance assessments measure the e0ectiveness of
the overall team 'hese are really a measurement of how well
the project management team is implementing the applicable
components of the human resource plan
2. .esource 4alendars 3. <round .ules?
Bround rules are the behavioral e)pectations the team has for
its members Bround rules are established and enforced by
the team itself
4. 4oClocation "or :ar .oom$
5. .ecognition and .e#ards
6. 1nterpersonal kills (Soft Sks)
Manage Pro2ect !eam? The process of trackng team member performance, provdng feedback, resovng ssues, and managng changes to enhance the pro|ect performance.
Methods of Conct Mgmt: Pro0lem solving (Confrontng): Its a :inC:in stuaton (Hghy favoured way) 4ompromising: 6oseC6ose method
:ithdra#al: 6oseC6eave method (PMI does not favour ths method) moothing: Lose-Yed method (Doesn't produce a souton)
-orcing: :inC6ose method (Worst way).
Leadershp styes: 5utocratic/5uthoritarian//irecting: Strong stye. The PM seeks tte or no nformaton from the team, and s the soe decson maker.
Bureaucratic/Persuading/4onsultative 5utocratic: Input s receved from seected team members, but the PM s st the soe decson maker.
/emocratic/Participative/4onsensus: Consuts team for open dscusson and nformaton gatherng; uses hep from team to come up wth a decson.
6assie7Cfaire//elegating/-ree .eign/hareholder: (Poor Leadershp Stye) Ltte or no nformaton exchange takes pace wthn the pro|ect group. 'eam has ultimate authority on "nal
decision, hands1o0 attitude. !ransactional? Transactona eadershp s reay |ust a way of managng (mangement by excepton) rather than a true eadershp stye as the focus on the
short-term tasks. !ransformational? A person wth ths eadershp stye s a true eader who nspres hs or her team constanty wth a shared vson of the future.
4on>ict management: The pro|ect manager, pro|ect management team, and the pro|ect team a need to be aware of and
sked n conct resouton technques. In the pro|ect envronment, conct can come from seven man sources, of whch the
rst three account for 50%:
ID #chedules
JD Priorities
6D Manpo3erBhuman resource availabilit&
4. Technca opnons
5. Procedura or pro|ect admnstraton
6. 4osts
7. Personates
4on>ict resolution: There are ve broad categores for resovng conct:
1. Pro0lemCsolving: aso known as confronting, s the preferred approach because t's the one most key to resut n a
:13C:13 souton for a partes. Probem sovng s a ogca approach to ndng the cause as we as the best souton. It ets
everyone dscuss contrbutng factors and what the pros and cons are for each souton. Probem sovng s best used when
there s sumcent tme to approach the probem and the group members have a certan eve of trust wth each other. Probem
sovng s aso good at fosterng team deveopment because t nvoves everyone n exporng the ssue.
2. 4ompromise s when a partes perform some gve-and-take to reach a mdde settement. Unfortunatey, ths resuts n a
6OEC6OE souton because no one s truy happy wth the souton. Probem sovng s the best approach, but compromse
may be necessary when tme s scarce or there's a deadock that can't be ogcay resoved.
3. -orcing s usng one's power to dctate hs or her w on the group. Forcng resuts n a :13C6OE stuaton, and ths s
generay the worst approach. It's harmfu to team morae because the team s aways on the osng poston. However, forcng
may be necessary n crtca stuatons when the stakes are extremey hgh and there s no tme for dentfyng aternatves.
When forcng s needed, ts ehects on the team can be tempered by sharng the ratonae wth them.
4. moothing s downpayng the ssue or focusng ony on the postve. It's reay hdng from the probem, and t doesn't
address the probem or even acknowedge that the probem exsts. Smoothng can be used to buy tme or when one party
beeves the stakes are ow and gvng a "wn" on ths ssue may be used to create an obgaton ater. Smoothng can often be
seen when one party gves n by sayng somethng ke "We, ts not mportant anyway, so you choose."
5. :ithdra#al s avodance or hdng from the probem, so t's not even a conct resouton technque. Wthdrawa may be an
opton as a temporary measure when there's a need for coong oh or there are key to be other aternatves that w present
themseves f gven enough tme.
6. 4olla0orating means workng wth other peope to make sure that ther vewponts and perspectves are taken nto acount.
Its a great way to get a rea commtment from everyone.
1. O0servation and 4onversation:
'he project management team needs to stay closely involved
in the day1to1day activities of the team in order to monitor
progress and get "rst1hand impressions from the team
members
1. 4hange .eHuests
/taLng changes, for whatever reasons, are treated as change
requests 'eam performance issues can also result in the
need for corrective or preventative actions
2. Pro2ect taL 5ssignments?
Project sta0 assignments are the people assigned to develop
the projects deliverables #ts needed for this process to know
who is on the project team and who is responsible for what
items
2. Pro2ect Performance 5ppraisals?
are formalized feedback about the individual:s team members
contributions to the project 'he purpose of appraisals is
twofold; "rst, the team member needs recognized for what he
or she is doing well< secondly, they need honest and direct
feedback on where improvements can be made
3. !eam Performance 5ssessments?
'eam performance assessments measure the e0ectiveness of
the overall team
3. 4on>ict Management
4. Performance .eports:
'hese provide performance reporting on activities,
accomplishments, and issues
4. 1ssue 6og:
'he issue log tracks all problems that can keep the project
from its goals
# Generay, ony one person s assgned Accountabty for a work package, but more than one person may be responsbe for performng the work on a work package.
# Tranng Expenses shoud be pad for by the Performng Organzaton or the Functona Manager and not by the Customer or the Pro|ect.
# Ground Rues: Forma or nforma rues that dene the boundares of behavor on the pro|ect. It s mportant that ground rues be dened and communcated to the team members.
# Fve Stages of Team Deveopment are: 1. Formng, 2. Stormng, 3. Normng, 4. Performng, and 5. Ad|ournng
# Constructve Team Roes: Intators, Informaton Seekers, Informaton Gvers, Encouragers, Carers, Harmonzers, Summarzers, and Gate Keepers.
# Dstructve Team Roes: Aggressors, Bockers, Wthdrawers, Recognton Seekers, Topc |umpers, Domnators, and Dev's Advocates.
# The greatest pro|ect conct occurs between Pro|ect Managers and Functona Managers. Most conct on a pro|ect s the resut of dsagreement over Schedue, Prortes, and Resource.
# Degaton s competey oppost to Mcromanagement (t s competey opposte to Degaton)
# PMI vews the process of managng conct wthn the pro|ect team as ntay beng the responsbty of the pro2ect team mem0ers.
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2. Stakehoder Management Strategy %Cace1to1face is the best& 2. Pro|ect Management Pan Updates
3. Pro|ect Management Pan 2. Interpersona Sks: 3. Pro|ect Document Updates
3. Management Sks 4. Organzatona Process Assets Upd
6. Organzatona Process Assets
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# Pro|ect Manager shoud be n contro of Pro|ect Communcaton Management Pan.
# Communcaton on Schedue sppage, Cost overrun, and Other ma|or Pro|ect Statuses shoud be FORMAL and n WRITING.
# Lessons Learned focus on Varance from the Pan and what woud be done dherenty n the future n order to avod these.
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1dentify takeholders? Identfy a peope or organzatons mpacted by the pro|ect and document ther nterests, nvovement and mpact on pro|ect success.
takeholder 5nalysis teps: 1. 1dentify takeholders 2. 5naly7e G 4lassify takeholders 3. /evelop trategy.
takeholders 4lassiAcation Models: 1. Power/Interest Grd (Authorty/Concern) 2. Power/Inuence Grd (Authorty/Invovement)
3. Inuence/Impact Grd (Inuence/Abty to ehect Pannng & Executon) 4. Saence Mode - descrbng casses of stakehoders based on ther Power, Urgency and Legtmacy.
Categores: 1. Champons - Postve Atttude, 2. Neutra - No nuence expected, 3. Chaenger - Ouestons the pro|ect,
4. Decson Makers - Manage Chaengers, Support Champons.
Strateges: For Indvduas - A. Assessment Matrx, B. Strategy Matrx. For Groups - A. Commmuncaton Strategy Matrx.
Pro2 charter: nformaton about nterna / externa partes ahected by pro|, ke sponsor(s), customers, team members,
groups & departments partcpatng n pro|ect, other peope /orgs ahected by the pro|.
takeholder 5nalysis: s process of gatherng / anaysng quanttatve/quatatve nformaton to determne whose
nterest shoud be taken care through out the pro|ect.
Step1: dentfy a potenta stakehoders and reavent nformaton, such as ther roes, departments, nterests, knowedge
eves, and nuence eves. Key stakehoders are easy to dentfy....dentfyng others s done my ntervewng the key
stakehoders and expandng the st unt a the stakehoders are dented.
Step2: prortze the key stakehoders; ndentfy potenta mpact or support each stakehoder coud generate and cassfy
them so as to dene an approach strategy.
Stakehoders Casscaton Mode:
<rids are a too to pot a stakehoders poston aong two axes that each represents a separate key factor. The two axes
spt the grd nto four quadrants, and where the potted pont fas gves us an ndcaton of what eve of partcpaton the
stakehoder needs and how much ehort the pro|ect manager w want to expend on meetng the stakehoders
expectatons.
- In the upperCright Huadrant are stakehoders who need actvey engaged n the pro|ect
- In the upperCleft Huadrant are stakehoders who need occasona engagement wth the pro|ect and pro|ect manager
- The pro|ect manager needs to keep an open and reguar daogue wth the stakehoders n the ower-rght quadrant.
- those n the ower-eft quadrant need to receve occasona foow-up and nformaton about the pro|ect, but the pro|ect
manager doesnt want to overwhem them wth communcaton
- Po#er / 1nterest grids: groupng based on ther eve of authorty (power) & ther eve of concern (nterest) regardng
pro|ect outcomes
- Po#er / 1n>uence grids: groupng based on ther eve of authorty (power) & ther actve nvovement (nuence) n
the pro|ect.
- 1n>uence / impact grids: groupng based on ther actve nvovement (nuence) and ther abty to ehect changes n
pro|ect pannng or executon
alience model: descrbes casses of stakehoders based on :
- po#er (Ths s a sub|ectve determnaton of how much nuence the stakehoder has to mpose hs or her w. For
exampe, a chef executve n the company usuay has a very hgh eve of power even f he or she snt drecty nvoved
n the pro|ect.)
- urgency (Ths s an assessment of how qucky the stakehoder w expect hs or her w to be acted upon.)
- legitimacy (Ths s a gauge of how much vested nterest the stakehoder has, gvng the stakehoder a egtmate stake
n the pro|ect. For exampe, a marketng manager probaby has no egtmacy n a pro|ect for the accountng department.)
Step3: Know the nuence each stakehoder hods; assess how key stakehoders are key to react or respond n varous
stuatons, n order to pan how to nuence them to enhance ther support and mtgate potenta negatve mpact.
1. Pro2ect 4harter 1. takeholder 5nalysis
investigates the interests, e)pectations, and in(uences of the
projects stakeholders
'o perform stakeholder analysis, we:ll need to;
5 Make sure weve identi"ed every person, group, or entity
a0ected by the project
7 Assess each stakeholder:s interests in the project
DOnow the in(uence each stakeholder holds
E3evelop proactive strategies for dealing with stakeholders
F3evelop proactive strategies for dealing with stakeholders
1. takeholder .egister
is the list of all people positively or negatively a0ected by the
project
2. Procurement /ocuments 2. takeholder Management trategy
/takeholder analysis uses a variety of techniques to
qualitatively and quantitatively identify the interest,
e)pectations, in(uences, and needs of stakeholders
%#takeholder Anal&sis Matrix&
U@ow will positive stakeholders be kept satis"ed-
U@ow could we reduce or eliminate the opposition from
negative stakeholders-
U@ow can we mitigate the risks negative stakeholders may
generate-
U!hat:s the role of others %outside the project& in managing
stakeholders-
U!hat types of communications, forums, and face1to1face
opportunities will work best for the various types of
information and issues that will need addressed-
#n face1to1face communication,
1 3ords make up only seven percent of the message
1 while paralingual elements convey 6K7 and
1 nonverbal elements convey LL7
Plan 4ommunications? Determnng the pro|ect stakehoder nformaton needs and denng a communcaton approach.
* Pan Communcaton s tghy nked wth Enterprse Envronmenta Factors (Org Structure).
TT1: Tota No of Comm Channes or Paths = n(n-1)/2 --- Comm Channes: # Upward Comm to Management # Latera Comm to Peers, other Functona Groups and Customers # Downward
Comm to Subordnates.
TT2: Factors that can ehect - 1. Urgency of the need for nformaton 2. Avaabty of Technoogy 3. Expected Pro|ect Stamng
4. Duraton of the Pro|ect 5. Pro|ect Envronment.
TT3: It conssts of the foowng components - a Sender, a Recever, Encode, Decode, a Medum (through whch messages are send and receved), Noce and Message & Feedback Message.
TT4: 1. Interactve Comm - A. Forma Verba (Presentatons and Speeches), B. Informa Verba (Meetngs, Conversatons, Humor, and Inqures) 2. Push Comm - A. Forma Wrtten (Pro|. Pans,
Charter, Comm over Long Dstances, Compex Probems, Lega Docs and Long or Tech stuatons for a wde and vared audence), B. Informa Wrtten (Status Updates, Informaton Updates
and Day-to-day Comm., Ema) 3. Pu Comm - for very arge voumes of nformaton, or for very arge audences (Internet Stes, E-earnng and Knowedge Repostores. And are more key
to use Forma Wrtten Methods)
Plan communications process determines 3ho needs 3hat info, 3hen the& 3ill need it, ho3 it 3ill be given to
them, and b& 3hom
2ommunications planning should cover both the formal and informal communication needs Cormal needs include
progress meetings, status reports, performance reports, issue disposition, and other customer, stakeholder, management,
or team communication items that are e)pected #nformal communications are those generally considered as social
interactions or impromptu meetings 11ad1hoc conferences, lunches, or hallway conversations
Communication ,e.uirement Anal&sis; 'his analysis looks not only at what is generally required for all projects, but
what communication needs are speci"c to the project being undertaken and its environment
11 Another important factor to consider is the interest level of the stakeholders in di0erent types of project
communication Much depends upon the project, but as an e)ample stakeholders in the accounting department will have
di0erent information needs than will stakeholders in the manufacturing department
11 .ther project1level factors to consider is how often speci"c information needs to be updated %eg, daily, weekly,
monthly&, the risk level of the project, and whether the project team is co1located, disbursed across multiple locations, or
is operating wholly or partially as a virtual team
11 PM should also consider the number of potential communication channels as an indicator of the comple)ity of the
project 'otal number of communication channels is; n > n + I? B J , where n is number of stakeholders
#t:s the #E0*E,M# responsibilit& to make the message clear, complete, and understood while it:s the ,ECEI!E,Ms
responsibility to make sure the message is received in its entirety and understood
Communication methods;
11 Interactive communication; involves just two or many people, one person provides information< others receive it and
then respond to the information #nteractive communication involves meetings, instant chats, electronic social
messaging, telephone calls, forums, and conferences
11 Push communication; this method involves one1way stream of information, the sender provides the information to
the people who need it but does not e)pect feedback on the information A)amples are status reports, company
memoetc
11 Pull communication; in this the project manager places the information on a central location, the recipients are then
responsible for retrieving or :pulling: the information from that location Pull communications involve web sites, intranet
repositories, podcasts, recorded webcasts, project libraries, and e1learning materials
1. takeholder .egister 1. 4ommunication .eHuirement 5nalysis?
means "guring out what kind of communication your
stakeholders need from the project so that they can
make good decisions
1. 4ommunications Management Plan:
U stakeholder communication requirements
U information to be communicated, format, languageX
U reason for distribution of that info
U time frame M frequency of distribution
U person responsible for communication
U person4groups who will receive communication
U methods4technologies to convey communication
U escalation process
U glossary of common terminology
U (owchart of info (ow in project
U communication constraints
2. takeholder Management trategy 2. 4ommunication !echnology; Methods used to transfer
informationXconverstaions, meetings, written docs
3. 4ommunication Models:
demonstrate how the various people associated with your
project send and receive their information
#ender; 'he person encoding and transmitting the message
+eceiver; 'he person receiving the message
Encode5 'he formulation of the message by the sender
Message5 'he output of the encoding process
Medium5 'he transport mechanism for the message chosen
by the sender, such as telephone, e1mail, speech, or printed
document
*ecode5 'he translation of the message by the receiver
0oise5 'his is anything that disrupts the (ow or
understanding of the message =oise can be auditory
disruptions, like static or background noise Cactors like
receivers education, e)perience, language, and culture e0ect
the way receiver decodes the message 2ommunication
model calls these types of factors as :noise:
4. 4ommunication Methods: interactive , push, pull
/istri0ute 1nformation? Executon of Comm Management Pan, as we as respondng to unexpected requestss for nformaton. It s the process of makng reevant nformaton avaabe to
pro|ect stakehoders as panned. It s performed accordng to Comm Management Pan, t s where the Buk of Pro|ect Communcaton takes pace.
TT1: Indvdua and Group Meetngs, Vdeo and Audo Conferences, Computer Chats, and other remote comm methods.
TT2: 1. Hard-copy document dstrbuton, 2. Eectronc Comm and Conferencng toos (Ema, Fax, Voce Ma, Teehpne, Vdeo and web Conferencng, Webstes and Web Pubshng), 3.
Eectronc Toos for Pro|ect Management (Schedung & Pro| Mgmt SW, Meetng and Vrtua Omce Support SW, Portas, and Coaboratve Work Management Toos).
'here are only four communication types< formal written, informal written, formal verbal, and informal verbal Cor the
test, you need to be able to tell which is which
)e careful about 3hen &ou use di9erent kinds of communication
Any time you need to get a message to a client or sponsor, you use formal communication Meetings are always
informal verbal, even if the meeting is to say something really important And any project document$like a project
management plan, a requirements speci"cation, or especially a contract$is always formal written
'here are a important aspects to e9ective communication;
0onverbal communication means your gestures, facial expressions, and ph&sical appearance while you are
communicating your message
Paralingual communication is the tone and pitch of your voice when youre talking to people #f you sound an)ious or
upset, that will have an impact on the way people take the news you are giving
:eedback is when you respond to communication 'he best way to be sure people know you are listening to them is to
give lots of feedback /ome ways of giving feedback are summarizing their main points back to them, letting them know
that you agree with them, or asking questions for clari"cation
KAnytime you are communicating with the customer about the scope of your project, its a good idea to use formal
3ritten communication
1. Pro2ect Management Plan 1. 4ommunication Methods?
U #nformal !ritten; Amails, memos
U Cormal !ritten; 2ontract, legal notices, project documents
U #nformal Jerbal; Meetings, discussions, phone calls
U Cormal Jerbal; /peeches, mass communication,
presentations
1. Organi7ational Process 5ssets Updates
2. Performance .eports 2. 1nformation /istri0ution !ools
Manage takeholder Expectations? It s the process of communcatng and workng wth stakehoders to meet ther needs and addressng ssues as they occur. It works to dentfy and
resove stakehoder concerns n a proactve and tmey manner. It w be performed throughout the pro|ect. The Pro|ect Manger s responsbe for stakehoder expectatons management.
Mgmt: 1. Actvey managng the expectatons, 2. Addressng concerns, 3. Carfyng and Resovng Issues.
1nterpersonal kills: Budng trust, resovng concts, actve stenng, overcomng resstance to change::::Ths s
where you use your "soft sks" to keep everybody on track and workng toward the same goa.
Management kills: Presentatons sks, negotaton sks, wrtng and pubc speakng sks.
1. takeholder .egister 1. 4ommunications Methods:
11 'his is where you decide how youll keep people in the loop
using Push, #nteractive and Pull methods
1. 4hange .eHuests
4. 1ssue 6og (Acton Item Log) (Each Issues shoud be
assgned to one Owner)
5. 4hange 6og
.eport Performance? It nvoves coectng and dssemnatng Pro|ect Informaton, Communcatng Progress, Utzaton of Resources and Forecastng Future Progress and Status. It reports
to the stakehoders how the pro|ect s progressng aganst the pan. Important note n Report Performance s that Performance Reports are actvey pushed to stakehoders rather than watng
for them to pu them down.
TT2: Forecastng Methods: 1. Tme Seres Methods - use hstorca data as the base (EV, Movng Average, Extrapoaton, Lnear Predcton, Trend Estmaton, and Growth Curve), 2.
Causa/Econometrc Methods - use Assumptons (Regresson anayss usng Lnear Regresson or Non-near Regresson, Autoregressve Movng Average (ARMA), ARIMA, and Econometrcs, 3.
|udgmenta Methods - ncorporate ntutve |udgements, opnons, and probabty estmates (Composte forecasts, Surveys, Deph method, Scenaro budng, Technoogy forecastng, and
Forecast by anaogy), 4. Other Methods (Smuaton, Probabstc forecastng, and Ensembe forecastng)
'he +eport Performance process can sometimes be confused with the 3istribute #nformation process, but there are
some key di0erences;
*istribute Information is concerned with general project information, such as meeting minutes, issues, and
correspondence
,eport Performance focuses on performance reporting against baselines, such as scope, schedule, cost, or quality
+eport Performance uses time, cost, and related work performance information
(ork Performance Information tells you the status of each deliverable in the project, what the teams accomplished,
and all of the information you need to know in order to "gure out how your projects going !henever you hear back from
a team member about how the job is going, thats work performance information
1. Pro|ect Management Pan
(Performance Measurement Basene - It ncudes Cost,
Schedue, Scope, Ouaty and Other Basenes)
1. Bariance 5nalysis
1 9ackward 6ooking 'ool %#t is an after1the1fact&< 6ooking at
performance data to see how it varies from the baseline
1. Performance reports?
(It shows how the pro|ect s progressng aganst the
varous basenes (Scope, Tme, Cost and Ouaty).
2. :ork Performance 1nformation (Deverabes Status,
Schedue Progress, and Costs Incurred)
2. -orecasting Methods
1 Corward 6ooking 'ool %AA2, A'2& < >sing Aarned Jalue and
other Corecasting methods to "nd out whether were on
budget and on schedule
Common Formats - Bar Charts, S-curves, Hstograms, and
Tabes. Varance, EV, Forecastng.
3. :ork Performance Measurements
Panned vs actua | (CV, SV, CPI, CPIc, SPI) |
3. 4ommunication Methods %PM generally uses a P>/@
2omm 'echnique&< 3eciding on Push, Pull, or #nteractive
methods of communicating
2. 4hange .eHuests: happen when you do +eport
Performance !hat do you do if you "nd out that your
forecasts have your project coming in too late or over budget-
8ou put the change request in as soon as possible And if you
need the project to change course, youll need to recommend
corrective actions to the team
4. Budget -orecasts 4. .eporting ystems (Standard Too for PM to Capture, 3. Organi7ational Process 5ssets Updates: especay
your essons earned.
/tore and 3istribute #nformation&< A system to keep track of
how much time and money people spend doing work
# Accordng to Ker7ner - ",&( of the Pro|ect Manager's tme s spent communcatng".
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1. Rsk Management Pan
3. Schedue Management Pan
4. Cost Management Pan
5. Ouaty Management Pan 7. Expert |udgement
9. Pro|ect Documents
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1. Rsk Regster 1. Strateges for Negatve Rsks or Threats 1. Rsk Regster Updates
2. Rsk Management Pan 2. Strateges for Postve Rsks or Opportuntes 2. Rsk-reated Contract Decsons
3o ONPN5 G ENEN- 3. Contngent Response Strateges 3. Pro|ect Management Pan Updates
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J Plan .isk Management? The process of DEFINING HOW to conduct risk management activities for a pro|ect. In Pan Rsk Management, the remanng FIVE rsk management processes are PLANNED (creatng a road
map for them) and HOW they w be conducted s documented. Here focus w be on "HOW RISKS WILL BE APPROACHED ON THE PRO|ECT".
# Rsk Management Pan denes WHAT LEVEL of rsk w be consdered toerabe for the pro|ect, HOW rsk w be managed, WHO w be responsbe for rsk actvtes, the AMOUNTS OF TIME and COST tht w be aotted to
rsk actvtes, and HOWrsk ndngs w be COMMUNICATED.
# Rsk Breakdown Structure (RBS): It s not breakng down the acta rsks, nstead, we are breakng down the 45!E<O.1E of rsks that we w evauate.
There are four basc ways to hande a rsk:
5void: The best thng that you can do wth a rsk s avod t-f you can prevent t from
happenng, t dentey wont hurt your pro|ect
Mitigate: If you cant avod the rsk, you can mtgate t. Ths means takng some sort of
acton that w cause t to do as tte damage to your pro|ect as possbe.
!ransfer: One ehectve way to dea wth a rsk s to pay someone ese to accept t for you. The
most common way to do ths s to buy nsurance.
5ccept: When you cant avod, mtgate, or transfer a rsk, then you have to accept t. But even
when you accept a rsk, at east youve ooked at the aternatves and you know what w
happen f t occurs.
== ====== ======= ==== ==== ==== ===== ================ ====
====== ===== ===== == =====
The amount of toerance a person or organzaton has for rsks s referred to as ts risk utility,
whch s a measure of how much negatve mpact the organzaton or person s wng to accept
n trade for a potenta postve benet.
.isk tolerant/risk seeking: These peope have a wngness to accept rsks even when the
benet doesnt seem worth the negatve mpact
.isk averse: These peope have a tendency to avod rsks even when the reward outweghs
the potenta negatve mpact
.isk neutral: These peope generay have a ogca, baanced approach that s weghted
aganst the pros and cons of the rsk.
.B: you come up wth ma|or risk categories, and then decompose them nto more detaed
ones
Exam potlight? For the exam, dont forget that you dene probabty and mpact vaues
durng the Pan Rsk Management process.
1. Pro2ect cope tatement 1. .isk Management Plan (It ncudes the foowng:
2. chedule Management Plan
for risk planning, it de"nes how risk management activities will
be scheduled
held with project team members, stakeholders, functional
managers, and others who might have involvement in the risk
management process
a& Methodolog&; 3escribes the approaches, tools, and techniques thatll govern how project
risk management will occur
b& ,oles and ,esponsibilities;
U+isk roles as required for the project %risk manager, risk management team&
U+esponsibilities for subsequent risk management processes %risk identi"cation, qualitative and
quantitative analysis, risk response planning, and risk monitoring&
c& )udgeting;
UActivities needed for risk management %and incorporated into the project schedule&
U+esources and costs allocated to risk management and risk activities as later de"ned and
incorporated into project cost baseline
UCrequency of risk management activities, such as risk reassessments and risk audits
d& 2iming; de"nes when and how often risk mgmt processes will be performed throughout the
project life cycle
e& ,isk Categories5 are general classi"cations that individual risks will be assigned to, and
these categories are established as part of the risk management plan+9/ risk breakdown
structure to list the categories and sub1categories of risks a typical project
f& *efnitions of risk probabilit& and impact5
Probability and impact scales
1 A relative scale %or ordinal scale& is the most simple and uses indicators such as low, medium,
and high
1 A linear scale %or cardinal scale& is numeric, and is commonly used to e)press the
probability of the risk, so a rating of 5 would imply a very low probability while a rating of Y
would indicate a very high probability
1 A non1linear scale is also numeric, but the intervals between the designations aren:t equal
%eg, 5, 7, E, I, 5G&
g& Probabilit& and impact matrix
h& ,evised stakeholdersM tolerances
i& ,eporting formats
j& 2racking
3. 4ost Management Plan
Cor planning of risks, the cost management plan de"nes how
the "nancial costs of risk management activities will be
budgeted for
4. 4ommunications Management Plan
Cor risk planning, it de"nes how data on risk will be
communicated
5. Enterprse Envronmenta Factors:
.ne of the key elements of the enterprise environmental
factors to consider as in input in this process is the risk
tolerance levels of the organization and the stakeholders
K 'he pro%ect manager is responsible for ensuring that risk
management is properly carried out
K 'he risk manager establishes the overall project risk
management methodology and for monitoring and controlling
risks
K Aach individual risk has a risk o3ner, whos responsible for
managing that risk, and one or more risk action o3ners,
wholl carry out risk response activities
,isk management planning involves;
U3e"ning what risk management activities will occur
UAstablishing the allotted time and cost for risk management
activities
UAssigning risk management responsibilities
U3eciding how risk probability and impact will be measured
U3eciding on acceptable risk thresholds and tolerances
1dentify .isk? The process of determnng WHICH risks may ahect the pro|ect and documentng ther characterstcs.
# TT1: Documentaton revews s when you ook at OPA and any documents to squeeze any possbe rsk out of them.
# TT2: Most common Technques are 1. Branstormng, 2. Deph Technque, 3. Expert Intervews, and 4. Root Cause Identcaton.
# TT4: Assumptons anayss s when we ook as pro|ect assumptons.
# TT5: Dagrammng Technques: Ishkawa/Cause-and-ehect/Fshbone Dagram, Inuence Dagram, and System or Process Fow Charts.
# TT6: SWOT: It s a too to measure each RISK's SWOT. Each rsk s potted, and the quadrant where the Weekness (usuay Interna) and Threats (usuay Externa) are HIGHEST, and the quadrant where Strenghts (agan,
usuay Interna) and Opportuntes (usuay Externa) are HIGHEST w present the HIGHEST RISK on the pro|ect.
:atchlist: 6o# priority risks shoud be reguary montored so make sure they are not
occurrng and that ther probabty, mpact, or prorty hasn't changed.
Prioriti7ed risks: Ouatatve anayss resuts n whch rsks are the hghest prorty and shoud
receve detaed rsk management ehorts.
Urgent risks: Rsk processes may uncover rsks that are aready underway or whch are
mmnent. Urgent rsks need mmedate pannng and acton.
!rends and common factors: Rsk categores, root causes, and mpacts may expose trends
that can make for more emcent rsk response pannng or rsk montorng.
Pro0a0ilities: Rsk scores can be aggregated and anayzed at the ob|ectve, deverabe, or
pro|ect eve to predct how key t s that the pro|ect w reach ts ob|ectves. An overa rsk
eve for the pro|ect can aso be tabuated.
Enterprise Environmental -actors: Be certan to check for industry information
(commerca databases, checksts, benchmarkng studes, and so on) or academc research
that mght exst for your appcaton areas regardng rsk nformaton.
4auseCandCeLect diagrams show the reatonshp between the ehects of probems and ther
causes. Ths dagram depcts every potenta cause and subcause of a probem and the ehect
that each proposed souton w have on the probem. Ths dagram s aso caed a shbone
dagram or Ishkawa dagram.
In>uence diagramming: Smpy put, they vsuay depct rsks (or decsons), uncertantes or
mpacts, and how they nuence each other. Example: The weather s a varabe that coud
mpact devery tme, and devery tme s a varabe that can mpact when revenues w occur.
1. 5ssumptions 5nalysis: reviews the reliability of each
assumption, what consequences will occur if the assumption
turns out to be inaccurate, and what risk factors are
generated by the assumption
1. .1K .E<1!E.:
,isk; 'he name, description, and a unique identi"er for the risk
,isk -3ner; 'he risk owner is the person in charge of monitoring and controlling the risk
,isk categor&; 'he categorization from the risk management plan that the risk falls within
,oot cause; 'he core factor%s& leading to the risk
Potential response; +esponses to risks are planned in +isk +esponse Planning, but potential
responses may become obvious during risk identi"cation and should be captured in the risk
register
Impact; 'he risk register contains the speci"c details about what will be e0ected should the
risk occur
Probabilit&; 'he probability of the risk e)pressed as a percentage or on a scale as de"ned by
the risk management plan
#&mptomsB(arning #igns; Any speci"c conditions likely to trigger the risk or symptoms that
the risk is about to occur should be identi"ed 'his will help during risk monitoring
,isk #core; 'he probability and impact score for the risk 'his is obtained from a formula
%usually probabilit& ) impact& de"ned in the risk management plan and generated from the
probability and impact matri)
,isk ,ankingBPriorit&; 'his is the prioritization or relative ranking for the risk that allows
e0orts to be spent more e0ectively on the higher priority risks
,isk ,esponse; 'he strategies and activities that will be taken to encourage and e)ploit a
positive risk, or address a negative risk
,isk ,esponse ,esponsibilities; 'he risk action owners are people who have risk response
actions to take
#econdar& ,isks; +isk responses can often raise new risks
,isk ,esponse )udget; 'his is the budgeted cost to implement approved risk responses
,isk ,esponse #chedule; 'he scheduled activities necessary to put the risk response into
action
Contingenc& Plan; 'hese are the actions that will take place should the risk response fail 'he
contingency plan also establishes under what criteria it:s to be enacted
:allback Plan; 'he fallback plan is a backup to the contingency plan should it fail
2. cope Baseline:
'he project scope statement, work breakdown structure, and
!9/ dictionary are the best places to begin looking for risks
since these documents thoroughly e)plain the project work and
identify constraints and assumptions
2. 4hecklist 5nalysis %it uses +9/&; 2hecklists can be
developed based on the risk categories %used in the risk
breakdown structure& or from similar projects
7. 5ctivity 4ost Estimates:
the Activity 2ost Astimates review may result in projections
indicating the estimates is either suLcient or insuLcient to
complete the activity
3. :O! 5nalysis:
#trengths; Positive attributes or elements 3ithin the
performing organization that will help the project reach the
objective
(eaknesses; =egative attributes or elements 3ithin the
performing organization that can inhibit the project from
reaching the objective
-pportunities; Positive attributes or elements outside the
performing organization that will help the project reach the
objective
2hreats; =egative attributes or elements outside the
performing organization that can inhibit the project from
reaching the objective
6. 5ctivity /uration Estimates 4. /iagramming !echniHues
5. 1nformation <athering !echniHues:
9rainstorming, interviewing, surveys %such as 3elphi&, root
cause anal&sis, 0ominal "roup 2echni.ue
4. /ocumentation .evie#s: A documentation review looks
for incomplete, missing, or out1of1date documents, which
implies a lack of integrative project management 3ocument
reviews might also uncover assumptions and constraints that
were not e)plicitly identi"ed in the project scope statement
8. takeholder .egister
Perform @ualitative .isk 5nalysis? t prioriti7es risks based on ther probabty of occurrng and ther potenta mpact to the pro|ect ob|ectves. Prortzaton s needed because rsk dentcaton uncovers a arge
number of rsks havng at east some potenta to nuence pro|ect ob|ectves. However, many of those rsks w be of such a ow prorty or have such a sma mpact that t sn't cost ehectve to address them, so quatatve
anayss aows the pro|ect team to focus on the most mportant rsks.
Perform @ualitative .isk 5nalysis foows rsk dentcaton, and t prortzes rsks based on
ther kehood of occurrng and ther potenta mpact to the pro|ect ob|ectves. Prortzaton s
needed because rsk dentcaton uncovers a arge number of rsks havng at east some
potenta to nuence pro|ect ob|ectves. However, many of those rsks w be of such a ow
prorty or have such a sma mpact that t sn't cost ehectve to address them, so quatatve
anayss aows the pro|ect team to focus on the most mportant rsks
.isk register provdes the st of dented rsks to be evauated.
.isk management plan provdes the detas on how probabty and mpact w be assessed
and what rsk scorng formua and rankng crtera w be used.
Rsks are prortzed and ranked based on ther overa rsk ratng score, but rsks can aso be
prortzed by ther expected monetary vaue, mpact, or any combnaton of other methods
.isk pro0a0ility and impact assessment: Ths assessment nvestgates each dented
rsks to expose the probabty and mpact to a the pro|ect ob|ectves. Ths data s used to
prortze or rank rsks.
Pro0a0ility and impact matrix: The probabty and mpact matrx uses an estabshed
ratng crtera and scorng formua for assgnng a score to dented rsks based on ther
probabty and mpact.
.isk data Huality assessment: Before quatatve anayss s performed, the rsk data
gathered shoud be revewed for accuracy, reabty, and ntegrty. Otherwse, the anayss w
be based on awed data.
.isk categori7ation: To hep n prortzaton or rankng, rsks can be categorzed n any
usefu method, such as by deverabe, phase, ob|ectve, or technoogy.
.isk urgency assessment: Ouatatve anayss may uncover rsks that are mmnent. These
may need fast-tracked nto subsequent rsk processes for mmedate attenton.
Expert 2udgment: Ouatatve anayss requres sub|ect matter experts and expert |udgment s
needed to nterpret, evauate, and present the quatatve data uncovered.
1. .isk .egister 1. .isk Pro0a0ility and 1mpact 5ssessment:
Probabty s usuay estmated as a percentage whe mpact
s estmated as a cost, tme, or quaty measure. Both
estmates are usuay qute sub|ectve, and gven n ranges.
For nstance, mpact mght be gven ony as "between $25,000
and $50,000" or "between 7 days and 14 days."
1..isk .egister Updates
Updates ncude:
5 +elative ranking or priority list of project risks,
7 +isks grouped by categories,
D 2auses of risk or project areas requiring particular attention,
E 6ist of risks requiring response in the near1term,
F 6ist of risks for additional analysis and response,
G (atchlists of low1priority risks, and
H 'rends in qualitative risk analysis results&
Pualitative risk analysis can also be used to;
5 determine whether the project should be selected, continued or terminated
Exam /potlight; 'he PM9.OZ Buide notes that the probability and impact matri) values are
usually set by the organization and are part of the organizational process assets
2. .isk Management Plan 2. Pro0a0ility and 1mpact Matrix
Probabilit& rating;
Jery 6ow %[5R\&, 6ow %[DR\&, Medium %[GR\&, @igh
%[IR\&, Jery @igh %[YF\&
impact scale;
Jery 6ow %5&, 6ow %7&, Medium %D&, @igh %E&, Jery @igh %F&
#coring formula; probability rating V impact rating
3. Pro2ect cope tatement 3. .isk /ata @uality 5ssessment:
reviews the quality, reliability, accuracy, and integrity of the
risk data collected
4. .isk Urgency 5ssessment:
As risks are reviewed, it may be obvious that some risks are
more likely to occur in the near term %or are already
occurring&, making these risks a top priority and requiring
them to be fast1tracked to other risk processes for immediate
planning and action
5. .isk 4ategori7ation:
Brouping and sorting risks in di0erent manners can help to
prioritize them!ays that risks can be grouped include by risk
owner, deliverable, phase, or technology
6. Expert 8udgment
Perform @uantitative .isk 5nalysis? The process of NUMERICALLY ANALYZING the e9ect of identifed risks on overa pro|ect ob|ectves. It rees on the prortzed st of rsks from the Perform Ouatatve Rsk Anayss
process. It deves further nto dented rsks by assgnng COST or other mpact measurements to them. COST and SCHEDULE are easy quanted, and ths process s concerned wth quantfyng the rsks. SCOPE generay
ts better nto the Ouatatve Rsk Anayss.
# TT1: 1. Intervewng, 2. Probabty Dstrbuton (Beta Dstrbuton, Tranguar Dstrbuton). Unform Dstrbuton can be used f there s no obvous vaue (eary concept stage of desgn). Probabty Dstrbutons are very
usefu for anayzng rsks.
# TT2: 1. Senstvty Anayss (!ornado /iagramshows HOW SENSITIVE each anayzed area of the pro|ect s to rsk. It ranks the bars from GREATEST to LEAST on the pro|ect so that the chart takes on a Tornado-ke shape).
2. Expected Monetary Vaue Anayss (EMB): The EMV of OPPORTUNITIES w generay be expressed as POSITIVE VALUES, whe those of THREATS w be NEGATIVE. EMV requres a Rsk-Neutra assumpton, nether rsk
averse, nor rsk seekng. A common type s "Decson Tree Anayss". 3. Modeng and Smuaton: Monte 4arlo 5nalysis throws arge numbers of scenaros at the schedue to see the mpact of certan rsk events.
Expected monetary value "EMB$ analysis:
s the cost or benet of an uncertan event. It's cacuated by mutpyng the monetary mpact
by probabty. EMV s what one coud expect over tme f the condton s repeated over and
over.
For an exampe, et's assume that there s a carnva game n whch there are three shes but
ony one has a png-pong ba under t. The game costs $1 to pay and the wnner w receve
$2 f he correcty pcks the she wth the ba hdden under t. There are two outcomes based
on the one-n-three chance of choosng the correct she: ether the payer oses 66.66% of the
tme or he wns two doars 33.33% of the tme. The EVM for ths game s:
EMV = (66.66% x $0) + (33.33% x $2)
EMV = $0 + $0.67
EMV=$0.67
EMV ncorporates any initial cost for the decson as a negatve vaue (such as cost of goods
or servces), whch n our exampe s the prce of the game:
Net EMV = (-$1) + $0.67
Net EMV = (-$0.33)
A negatve EMV s a rsk cost and a postve EVM s a benet, so n ths exampe the odds are
not n the payer's favor over the ong term even f he wns $2 one out of every three tres. But
f the game pays out $5 nstead, the odds turn to hs favor and he' wn an average of $0.67
each tme he pays.
EMV = (66.66% x $0) + (33.33% x $5)
EMV=$0 + $1.67
EMV = $1.67
Net EMV = (-$1) + 1.67
Net EMV = $0.67
Another use of EMV s n estabshng the contingency reserve by
aggregatng the EMV for each known rsk.
1. .isk .egister:
'he risk register is a comprehensive list of all threats and
opportunities the project faces #t also contains supplementary
data about each risk, including its impact, probability, risk
response, budget, risk owner, and contingency and fallback
plans
1. /ata <athering and .epresentation !echniHues:
-- Intervie3ing
11 Probabilit& distribution
11 A)pert judgment
1. .isk .egister Updates
%>pdates include 5 Probabilistic analysis of the project, 7 Probability of achieving cost and
time objectives, D Prioritized list of quanti"ed risks, and E 'rends in quantitative risk analysis
results&
2. .isk Management Plan 2. @uantitative .isk 5nalysis and Modeling !echniHues:
1 #ensitivit& anal&sis + looks individually at each project
objective and measures how uncertainty could impact that
objective 'his makes it possible to identify what risks have
the greatest potential impact, and can show how uncertainty
can impact project objectives
Cor e)ample, if labor cost could (uctuate between 17R\ and
N7R\, sensitivity analysis applies this cost range throughout
a0ected project components and then displays which
components are most susceptible to this risk sensitivity
analysis are usually shown as a tornado diagram or a spider
diagram
1 Expected monetar& value >EM!? anal&sis
1 *ecision tree anal&sis
Cor e)am, simply know the following, Monte 2arlo analysis;
5 evaluates overall risk in the proj
7 provides probability of completing a proj on any speci"c day or for any speci"c cost
D 'akes into account path convergence on =etwork 3iagram
E +esults in probability distribution
111 Cor the E1AM, remember that interviewing is a tool and technique of the Perform
4uantitative ,isk Anal&sis process Although you can use this technique in the #dentify +isks
process, remember that its part of the data gathering and representation technique and not a
named tool and technique itself
111 0ormal and lognormal distributions use mean and standard deviations to quantify risk,
which also require gathering the optimistic, most likely, and pessimistic estimates
111 Cor the E1AM, remember that simulation techniques are used to predict schedule or cost
risks
Plan .isk .esponses? n ths we decde on the ACTIONS needed to reduce the threat of negatve rsks or enhance the opportuntes for postve rsks as we as deveopng contngency pans. Ths process occurs after
dented rsks have been prortzed, and t w generay focus ony on the hghest prorty rsks.
.isk actions are of 3 types:
1- .isk response:- The rsk response determnes the strategy for nuencng the probabty and mpact of the rsk before t occurs. For negatve rsks, ts am s to emnate the rsk or reduce ts mpact shoud t occur. For
postve rsks, the response tres to ncrease the probabty or mpact of the rsk.
2-4ontingent response/contngent pan:- t estabshes what actvtes w take pace shoud a specc event or stuaton occur. A contngency pan ams to nuence the mpact of a rsk that s occurrng. The rsk response
occurs BE-O.E the rsk and tres to ater the probabty and/or mpact whe the contngency pan ony occurs 5-!E. the trgger (usuay the rsk event) and focuses ony on changng the mpact.
3--all0ack plan:- The faback pan kcks n f the contngency pan fas. It can be ooked at as a contngency pan for the contngency pan. The faback pan spes out steps w be taken to recover f the contngency pan
fas
-- .esidual risk s a eftover rsk. After youve mpemented a rsk response strategy-say mtgaton, for exampe-some mnor rsk mght st reman. The contngency reserve s set up to hande stuatons ke ths. Resdua
rsks are those that reman and whose probabty and mpact are such that they're acceptabe to the performng organzaton's eve of rsk toerance. They can aso be those rsks n whch there are no reasonabe responses
for.
-- econdary risks are rsks that come about as a resut of mpementng a rsk response. The exampe where you transferred rsk by hrng a drver to take you to your destnaton but the person became aong the way s
an exampe of a secondary rsk. The drvers ness deayed your arrva tme, whch s a rsk drecty caused by hrng the drver or mpementng a rsk response. When pannng for rsk, dentfy and pan responses for
secondary rsks.
# TT1: 5void - Undesrabe Rsks, !ransfer//e>ect - to another party (Contractua Agreements and Insurance), Mitigate - to make t ess, 5ccept (Negatve/Postve) - best strategy may not be to Avod, Transfer, Mtgate,
Share, or Enhance t. Instead, the best strategy may be smpy to Accept t and contnue wth the pro|ect. If the cost or mpact of the other strateges s too greater, acceptance s the best strategy.
# TT2: Exploit - tryng to remove any uncertanty, hare - mprove ther chances of the postve rsk occurrng by workng wth another party, Enhance - rst we have to understand the underyng cause(s) of the rsk. By
nuencng the underyng rsk trggers, you can ncrease the kehood of the rsk occurrng.
1. Rsk Regster Updates: Resedua Rsks, Secondary Rsks, Contngency Pan, Rsk Response Owners, Faback Pans, Reserves/Contngency, and Rsk Trggers.
RISK response strateges:
-- !hreats:- Avod, Mtgate, Transfer
-- Opportunities:- Expot, Enhance, Share
-- Either (Threats OR Opportuntes): Accept, Contngent
Responses for 3E<5!1BE rsks (threats):
#5void: Avodance actvtes am to competey emnate a rsks probabty or mpact to zero.
Avodance can take severa forms, such as restructurng the pro|ect actvtes, scope, schedue,
or cost to eradcate the root causes eadng to the rsk.
#Mitigate: If the rsk cannot be avoded, actons mght be taken to reduce the rsk's
probabty or ts mpact f t does occur. Mtgaton usuay nvoves makng aternate choces
that can be ess than dea.
#!ransfer: Transference assgns a or part of rsk to a thrd party through outsourcng,
contracts, nsurance, warrantes, guarantees, or performance causes.
Responses for PO1!1BE rsks (opportuntes):
Exploit? Expotng a postve rsk s about ensurng everythng s n pace to ncrease the
probabty of the occurrence of the rsk. Here s an exampe of expotng a rsk. Suppose, some
members of your team have determned a new technque to deveop a product and by usng
ths technque, the pro|ect duraton can be reduced by 20%. To expot ths, you can ensure the
technque s used n the pro|ect and other team members are traned on the new technque.
hare? Sometmes ts harder to take advantage of an opportunty on your own. Then you
mght ca n another company to share n t wth you.
Enhance? Enhancng a rsk nvoves dentfyng the root cause of a postve rsk so that you can
nuence the root cause to ncrease the kehood of the postve rsk. For exampe, n order for
you to get a busness dea, your workforce needs to have substanta PeopeSoft sks. You can
enhance the postve rsk (opportunty) by tranng your workforce on PeopeSoft or hrng
PeopeSoft specasts. Hence, the probabty of you gettng the dea s ncreased.
5ccept? |ust ke acceptng a negatve rsk, sometmes an opportunty |ust fas n your ap. The
best thng to do n that case s to |ust accept t!
##3ote? Acceptng s a strategy that s appcabe to both Negatve and Postve Rsks. It s
mportant for you to remember ths for the PMP exam.
Exam: Trcky queston, when n the rsk mgmt process are
responses documented?
5ns#er s n both Identfy rsk and Pan rsk responses.
Monitor and 4ontrol .isks? The process of IMPLEMENTING risk response plans, TRACKING identifed risks, MONITORING residual risks, IDENTIFYING ne3 risks, and EVALUATING risk process e9ectiveness
throughout the pro|ect. #TT5: Focuses on functonaty, ookng at HOW the pro|ect has met ts goas for deverng the scope over tme.
1. Rsk Regster Updates: Outcomes of Rsk Audts and Reassements, Identcaton of New Rsks, Cosng Rsks that no onger appcabe, Detas what happened when Rsks occurred, and Lessons Learned.
Management .eserve, whch s money set asde to hande any unknown costs that come up
on the pro|ect.
Thats a dherent knd of reserve than the one for controng rsks. The knd of reserve used for
rsks s caed a 4ontingency .eserve, because ts use s contngent on a rsk
actuay materazng.
Pro|ect managers sometmes tak about both knds of reserves together, because they
both have to show up on the same budget. When they do, you sometmes hear tak of
"kno#n unkno#ns" and "unkno#n unkno#ns."
The management reserve s for unkno#nCunkno#ns-thngs that you havent panned
for but coud mpact your pro|ect.
The contngency reserve s for kno#n C unkno#ns, or rsks that you know about and expcty
panned for and put n your rsk regster.
Pro| Budget=> Pro| Base cost + Rsk response cost (panned)
Pro2 -unding .eHuirements =>
Reserve =>Contngency (known unknowns) + Mgmt Reserve
(unknown)
1. .isk .egister 1. Rsk Audts:
review the overall risk management policies, procedures, and
processes
1. .isk .egister Updates
2. Pro2ect Management Plan 2. Rsk Reassessment:
8ou should have some regularly scheduled reassessment
meetings to go over all of the information you have to date
and see if your risk register still holds true #n a reassessment,
your main goal is to "nd any new risks that have come up
2. 4hange .eHuests
3. Performance .eports 3. Reserve Anayss:
Sust like you keep running tabs on your budget, you should
always know how much money you have set aside for risk
response As you spend it, you should be sure to subtract it so
you know if you have enough to cover all of your remaining
risks
4. :ork Performance 1nformation 4. Status Meetngs (Team Meetngs):
5. Technca Performance Measurement:
2omparing the performance of your project with its planned
performance /o if you e)pected to hit a speci"c milestone,
you could check performance information on your product at
that time to see if it measured up to the plan #f not, that
might indicate that there are risks you didnt plan for
6. Varance and Trend Anayss:
2omparing the actual project performance to the plan is a
great way to tell if a risk might be happening #f you "nd that
youre signi"cantly over budget or behind schedule, a risk
could have cropped up that you didnt take into account
P.O4U.EME3!
1nputs !ools G !echniHues Outputs
*,
P
6
5
3
3
1
3
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6. Cost Performance Basene (Budget)
7. Actvty Resource Requrements
9. Rsk-Reated Contract Decsons
3. Expert |udgement
F&
E
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E
4
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3
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1. Pro|ect Management Pan (Pr M P) 1. Advertsng
2. Pro|ect Documents 2. Internet Search
4. Procurement Documents 3. Resource Caendars
4. Change Requests
5. Pro|ect Management Pan Updates
6. Pro|ect Document Updates
9. Organzatona Process Assets 7. Expert |udgement
F%
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4
1. Pro|ect Management Pan 1. Inspectons and Audts 1. Procurement Documentaton
2. Procurement Documents 2. Procurement Performance Revews
3. Contract 3. Performance Reportng 3. Pro|ect Management Pan Updates
4. Organzatona Process Assets Updates
5. Performance Reports
6. Work Performance Informaton
F)
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6
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3
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1. Pro|ect Management Pan 1. Cosed Procurements
2. Procurement Documentaton 2. Organzatona Process Assets Updates
# FFP - Rsk s entrey shfted to the SELLER. It s very popuar 'When the Scope of work s throughy dened & competey known'.
# T&M - The Buyer bears the most rsk of Cost overruns. It s used when the SCOPE of work s not competey dened.
CEILING PRICE (CP)
TARGET COST (TC) 9000000
TARGET FEE (TF) 850000
9850000
ACTUAL COST (AC) 8000000
%%I&&&&
-1356 -EE
,%I&&&& -1356 P.14E
-7416666.66666667
S% IS SELLERS PERCENT 0.3
B% IS BUYERS PERCENT 0.6
l
J
Plan Procurements? Heres where you take a cose ook at your needs, to be sure that you reay need to create a contract. You gure out what knds of contracts make
sense for your pro|ect, and you try to dene a of the parts of your pro|ect that w be contracted out.
* Document Make/Buy decsons and dene the purchasng approach.
* Buyers Rsk (from Hghest to Lowest) - CPFF - T&M - CPIF - FPIF - FFP * Commony used & Preferred Type - FFP
* Drect Cost or Out-of-Pocket Cost * RFI - Request for Informaton * IFB - Invtaton for Bd * RFB/P - Request for Bd/Proposa * RFO - Request for Ouotaton (Proc Docs)
* IFB or RFB/P used for 1. Snge Prce, 2.Hgh $ Vaue, 3. Standardzed * RFO used for 1. Per Item/Hour Prce, 2. Lower $ Vaue, 3. May be used to deveop nfo n RFP
The procurement documents are what you use to nd potenta seers who want your busness. The source seectron crtera are what you use to gure out whch seers
you want to use.
---The !ime G Materials "!GM$ contract s the riskiest one for the BUEE., because f the pro|ect costs are much hgher than the orgna estmates, the buyer has to
swaow them, whe the seer keeps gettng pad for the tme worked.
--- A -1;E/ price contract s the riskiest sort of contract for the E66E.. Thats because theres one prce for the whoe contract, no matter what happens. So f t turns out
that theres a ot more work than expected, or the prce of parts or materas goes up, then the seer has to eat the costs.
4O3!.54! types: contract s what creates the buyer-seer reatonshp
-- -1;E/ Price: A xed prce contract s for a product, servce, or resut at a speced at prce. Ths type of contract s an opton ony f the
extent of the work, tme nvoved, and matera needs can be accuratey descrbed and costs reasonaby estmated.
Fxed prcng arrangements can be combned wth other types of contracts to even out the rsks for both the buyer and seer:
#Fxed prce wth ncentves (FPI): Ths arrangement ncudes addtona nanca ncentves that are ted to the seer achevng specc
ob|ectves. Incentves can be based on schedue, performance, quaty, or any other measures.
#Fxed prce wth economc prce ad|ustments (FPEPA): Ths contract has specc condtons or schedued perods durng whch the xed prce
basene may be ad|usted based on market condtons.
#Fxed prce, eve of ehort (FPLOE): A eve of ehort contract s st a xed prce, but t ncudes a requrement that the seer expend at east a
specc amount of ehort. For exampe, n a research and deveopment pro|ect, the buyer agrees to a $50,000 at prce and the seer agrees that
ts contractors w devote 1,000 hours of ehort.
#Fxed prce wth prospectve prce redetermnaton (FPPPR): Ths arrangement s a "staged" xed prce contract where the xed prce for each
stage s negotated, possby based on past performance.
-- 4O! reim0ursa0le: In a cost-rembursabe contract the buyer pays the actua ncurred costs pus a margn to the seer.
Cost-rembursabe contracts are approprate when there's a hgh eve of uncertanty n what w be requred to provde the contracted product,
servce, or resut. The BUEE. s the one who bears the rsk of cost overruns, and cost-rembursabe contracts aso nvove more admnstraton
from both buyer and seer snce there has to be some method of submttng, vadatng, and audtng of actua costs.
Some common approaches the buyer can use to keep the pro|ect tmene and expenses from gettng out of contro:
#Cost-rembursabe wth ceng: In ths arrangement, costs are rembursed up to a maxmum, agreed-upon eve. Ths heps reduce the buyers
rsk of cost overruns.
#Cost-savngs sharng: In ths contact, a budget s estabshed for actua costs, and the buyer shares a porton of the unused budget wth the
seer at the concuson of the pro|ect. Ths serves as an ncentve for the seer to keep costs ow.
#Cost pus xed fee (CPFF): In ths arrangement, the seers prot s a at fee, whch serves as a motvator for the seer to keep the duraton
as short as possbe. Snce the seer earns the same amount of money f t takes three months or nne months, t makes sca sense to earn ts
prot n as short a tme as possbe so that the seer can move on to another |ob.
#Cost pus ncentve fee (CPIF): In ths contract, the seer's margn s ted speccay to ts achevement of agreed-upon ob|ectves
-- !1ME and M5!E.156: In a tme and matera contract, the buyer s responsbe for abor costs at an agreed-upon rate pus any ancary costs
the seer may ncur.
The buyer bears a hgh rsk of schedue overruns resutng n extra abor costs. Incentves and caps can be ncorporated nto a T&M contract to
reduce ths rsk.
-- U3165!E.56: ths s a speca cass of contract n whch the seer doesn't have to expcty accept the oher n order for a contract to be
estabshed. Ths s a unatera contract, and the best exampe s a purchase order "PO$.
When the buyer submts a purchase order to the seer, t has estabshed an oher to buy goods or servces from the seer. By smpy fung the
purchase order, the seer has accepted the oher and a contract exsts even though the seer dd not formay acknowedge the buyer's oher
(purchase order).
-- U31! price: A unt prce contract s generay for products, materas, or other tangbe goods that are bought n quanttes at a xed rate for a
pre-determned quantty of goods
--!E5M13< agreements:
E;5M: you are tryng to decde whether to ease or buy. the day ease cost s $120D. To purchase the tem the nvestment cost s $1000, and
day cost s $20D. How ong w t take for the ease cost to be same as the purchase cost?
$120D = $1000 + $20D
$120D - $20D = $1000
$100D = $1000
D= $1000/$100 = 10, ths ndcates that the costs are same after 10 days. f pannng to use the tem for ess than 10days then ease wd be
better and f t s to be used for more than 10 days, then t wd be better to purchase.
1. .eHuirements /ocumentation 1. MakeCorCBuy 5nalysis:it is better to
make if;
1work involves proprietar& info
1you want to retain control
1you have an idle workforce4plan etc
1. Procurement Management Plan:
3e"nes how the overall procurement needs of the project will be planned,
e)ecuted, managed, monitored, and closed
2. !eaming 5greements 2. Procurement tatement of :ork "O:$:
Provides the potential sellers the deliverables, materials, speci"cations,
milestones, requirements, acceptance criteria, and any other characteristics
3. cope Baseline
4. Pro2ect chedule: to determine when
procurement wld be required
2. 4ontract !ypes:
'hree broad categories;
+:ixed Price >:P?
+2/M
+Cost ,eimbursible>C,?
5. 5ctivity 4ost Estimates
3. Procurement /ocuments: Proposed contract is inclued in Proc 3oc
2ontains collection of written materials that provides the potential sellers all
the information they need to develop and submit a bid or proposal; e)ample;
,:P, I:),,:4
8. .isk .egister 4. MakeCorCBuy /ecisions
5. ource election 4riteria:
are what youll use to "gure out which sellers you want to use
9efore the bid or proposals are solicited, the selection and evaluation methods
that:ll be used for choosing the seller should be established
10.Enterprse Envronmenta Factors:
market place conditions etc
11. Organzatona Process Assets:
list of pre1quali"ed sellers, lessons learned etc
6. 4hange .eHuests
Procurement management plan includes: How make-or-buy anayss and decsons are to be made.What quaed seer sts w be used or how quaed seer sts
w be created.The types of contracts aowed.The expct procurement roes and responsbtes and eves of authorty those roes have wthn the pro|ect.The
procurement documents to be used, such as any standardzed forms, and the formats for statements of work.The procedures for bd and proposa soctaton.When and
how ndependent estmates w be gathered.Idented constrants and assumptons reated to procurement processes.How seers w be managed, performance
montored, and what reportng and frequency w be requred.What nsurance or performance bonds w be requred and under what stuatons.Mestones that need
estabshed n contracts.What the procedures are for seer payments, vouchers, and rembursements.How approprate coordnaton between procurement processes and
other pro|ect management processes (scope, tme, cost, quaty) w be ensured.The frequency, responsbty, and gudenes for procurement audts.
:ell deAned Procurement /oc #ill help in:
1 easier comparison of sellers responses
1more accurate pricing
1more complete responses
1decrease in number of changes to the project
4onduct Procurements?
-- process distri0utes procurement documents (before u send proc doc to prospectve seers, u need to know who those seers are - Advts, Internet Search..
-- collects responses
-- evaluates the 0ids or proposas
-- asty esta0lishes a contract wth the seected seer
Point of total assumption "P!5$: s the pont at whch the seer assumes the costs. Ony appcabe to -P1- contracts.
The PTA s when the seer becomes responsbe for a costs. The formua uses the ceng and target prces and the buyer's cost sharng porton.
The ceng prce s the most pessmstc cost based on reasonabe factors. Anythng above the ceng prce s consdered to be due to ack of
oversght by the seer.
P!5 = !arget 4ost + | %Ceiling Price 1 2arget Price& 4 )u&erMs Percentage #hare of Cost S
For exampe, a contractor has agreed to bud a storage depot at a ceng prce of $100,000. The targeted prce s $90,000, and the buyer and
seer agree that the target cost s $80,000, and that the seer w be responsbe for 25% of costs that run over the target. Ths structure w
make the buyer responsbe for 100% of the costs up to $80,000, and 75% of costs between $80,000 and $100,000.
Target Prce: $90,000 PTA = $80,000 + ($100,000 - $90,000) / 75%
Target Cost: $80,000 PTA = $80,000 + $10,000/.75
Ceng Prce: $100,000 PTA = $80,000 + $13,333.33
Share Rato: Buyer = 75%; Seer = 25% PTA = $93,333.33

PTA = !arget 4ost + | (4eiling Price - !arget Price) / BuyerTs Percentage hare of 4ost |
!arget Price = Target Cost + Target Fee
5ctual fee (AF) = TF + {(TC - AC) x SSR}
-inal price = AC + AF
4ost savings = Target cost- Actua cost
ellerTs share(IF) n cost savngs = % x Cost savngs
4ost of the contract = Actua Cost + Seer's mnmum fee + seer's share(IF) n cost savngs
Prce: s the amount seer charges the buyer.
Prot (fee): ths s panned nto the prce the seer provdes to buyer.
Ceng Prce: s the hghest prce buyer w pay to seer.
TC
TF
TP = TC + TF
AC
AF = ((TC - AC) x S%) + TF
AP = AC + AF
Cost savngs = TC - AC
Cost of contract = AC + Seers mn fee + ( S% x Cost savngs)
PTA = ((CP - TP) / B%) + TC
1. elected ellers
2. Procurement 4ontract 5#ard
3. Bidder 4onference (Vendor/Pre-
bd/Contractor)
3. !eaming 5greements (Master ervices
5greement): in this there is a contract in place
between the seller M buyer for a type of service as
needed !hen speci"c work is needed , the buyer
M seller work to create scope of work and then
initiate a project under e)isting terms of M/A.
4. Proposal Evaluation !echniHues
5. MakeCorCBuy /ecisions 5. 1ndependent Estimates %buyer may
compare sellers proposal with an
estimate created in1house or with
outside assistance&
6. ource election 4riteria 6. Procurement 3egotiations:
.bjectives of =egotiation;
1obtain a fair M reasonable price
1develop a good relationship with seller
Main #tems to negotiate;
+scope, +schedule, +price
7. @ualiAed ellersT 6ist
8. eller Proposal
5dminister Procurements? The process of managng procurement reatonshps between buyer and seer, montorng contract performance, and makng changes and
correctons as needed.
* Manage the reatonshps, montor performance and make changes as necessary. * The buyer and seer revew the contract and the work resuts to ensure that the resuts
match the contra contract. * Manages any eary termnatons of the contract work (for Cause, Convenence or Defaut) n accordance wth the Termnaton Cause n Contract.
-P-when there s we deAned specs and requrements.seer s at rsk.
!GM-n whch level of E::-,2 cannot be dened at the tme the cotract s awarded.
4ost reCim0ursi0le-when the exact scope of (-,; is uncertain and therefore cost cannot be estmated accuratey enogh to use FP.
Incentves-are used to brng the seers ob|ectve n ne wth the buyer's.
PO-when you are buyng standard commodtes.
From BUEE. perspectve Priorities least to most important?
4ost Plus -ixed -ee - 4P--: Cost, Tme, Performance
4ost Plus 1ncentive -ee-CPIF: Tme, Performance, 4ost -for ncentve fee, Cost s most mportant crtera
4ost Plus 5#ard -ee-CPAF: Cost, Tme, Performance
!GM: Performance, Tme, 4ost
-P1-: Tme, Performance, 4ost -for ncentve fee, Cost s most mportant crtera
-P: Cost, Tme, Performance
!ermination:
--- The buyer may termnate a contract for cause f the seer breaches the contract.
--- The buyer can aso termnate a contract before the work s compete because they no onger want the work done (termnaton for convnence).
In ths case the seer s pad for the work competed and work n progress.
2. 4hange .eHuests
4. 5pproved 4hange .eHuests 4. 4ontract 4hange 4ontrol ystem
5. Payment ystem:
'he payment system is how your
company pays its sellers
6. 4laims 5dministration?
2laims are usually addressed through
the contract change control system
7. .ecords Management ystem
'here are a lot of records produced by a
typical contract; invoices, receipts,
communications, memos, emails,
instructions, clari"cations, etc 8oull
need to put a system in place to manage
them
4lose Procurements? The process of competng each pro|ect procurement.
* Fnaze and Cose each purchasng contract. * When the contract s Competed or Termnated for any reason, ths process s performed.
Procurements are closed #hen:
-- When contract s cosed
-- When contract s termnated before the work s competed.
Procurement closure needs to happen before Pro2ect 4losure. A procurements MU! be 46OE/ before the pro|ect s cosed.
--- Procurement 4losure is done only at the completion of each closure.
Admnstratve Cosure (cose pro|ect or phase process):
Procurement cosure:
------------------Procurement cosure nvoves:
# Product verAcation,
J 3egotiated settlements,
J -inancial closure,
J Procurement 5udits,
1. Procurement 5udits (+eview of
Procurement Processes 1 for capturing
6essons 6earned)
2. 3egotiated ettlements
3. .ecords Management ystem
# FPIF - Pont of Tota Assumpton (PTA) s a pont n the contract where a subcontractor assumes responsbty for a addtona costs.
PTA = Target Cost + ((Ceng Prce - Target Prce + Fxed Fee (f t s there)) / Buyer's % share of cost overrun)
# FP-EPA - Fxed Prce wth Economc Prce Ad|ustment. It s popuar where Fuctuatons n Exchange Rates and Interest Rates. Economc Stpuaton may be based on the Interest
Rates, the Consumer Prce Index, Cost of Lvng Ad|ustments, Currency Exchange Rates or other Indces.
TARGET PRICE = TC + TF
ACTUAL FEE (AF) =
((TC - AC) X S%) + TF
ACTUAL PRICE = AC + AF
COST SAVINGS = TC - AC
COST OF CONTRACT=
AC + SELLERS MIN FEE + (S% X
COST SAVINGS)
PTA=((CP - TP) / B% ) + TC
1MPO.!53! PO13! C %
Point to remem0er
1
2
3
4
5
6
7
8
9
10 # Pro|ect Cost Basene = Pro|ect Estmates + (Cost) Contngency Reserves; # Pro|ect Cost Budget = Pro|ect Cost Basene + Management Reserves
11
12
13
14
15
16
17
18
19
20
21
22
23
24
l
J
EEF & OPA must be taken nto account for every process, even f they are not expcty sted as nputs n the process speccaton.
Pro|ect Management Team Actvtes: 1. Anayze and understand the scope. That ncudes the pro|ect and product requrements, crtera, assumptons, constrants, and
other nuences reated to a pro|ect, and how each w be managed or addressed wthn the pro|ect. 2. Understand how to take the deted nformaton and then
transform t nto a pro|ect management pan usng a structured approach. 3. Perform actvtes to produce pro|ect deverabes. and 4. Measure and montor a aspects of
the pro|ect's progress and take approprate acton to meet pro|ect ob|ectves.
Often the /cope, /chedule, and 2ost 9aselines w be combned nto a Performance Measurement 9aseline that s used as an overall Project 9aseline aganst whch
ntegrated performance can be measured. The Performance Measurement Basene s used for Earned Vaue Measurements.
# Actvtes necessary for Admnstratve Cosure of the Pro|ect or Phase, ncudng step-by-step methodooges that address: 1. Actons and actvtes necessary to satsfy
competon or ext crtera for the phase or pro|ect; 2. Actons and actvtes necessary to transfer the pro|ect's products, servces, or resuts to the next phase or to
producton and/or operatons; and 3. Actvtes needed to coect pro|ect or phase records, audt pro|ect success of faure, gather essorns earned and archve pro|ect
nformaton for future use by the organzaton.
# 4onAguration Management ystem "4M$: A CMS wth Integrated Change Contro provdes a standardzed, ehectve, and emcent way to centray manage
approved changes and basenes wthn a pro|ect. CM s a systematc procedure that refers to change management. CM protects both the customer and the pro|ect stah. *
CMS s a coecton of forma documented procedures used to appy drecton and contro compance of products and componenets wth pro|ect requrements. * Is a
subsystem of the PMIS. * Incudes the processes that dene how pro|ect deverabes and documents are controed, changed, and approved. * In many areas ncudes the
Change Contro System.
Conguraton Management Actvtes: 1. Conguraton Identcaton, 2. Conguraton Status Accountng, and 3. Conguraton Vercaton and Audt.
# -ait accompli: An accompshed fact; an acton whch s competed before those ahected by t are n a poston to query or reverse t. The tera transaton nto Engsh
of ths French phrase s a fact reazed or accompshed - what mght these days be caed a done deal.
# :B? WBS a deverabe-orented herarchca decomposton of the work to be executed by the pro|ect team. The WBS s nazed by estabshng Contro Accounts for
the work packagess and a unque denter from a code of accounts. The WBS represents a product and pro|ect wor, ncudng the pro|ect management work (Ths s
sometmes caed the %&&( rule).
# The WBS can be structured as an outline, an organi7ational chart, a Ash0one diagram, or other methodN
# Dherent deverabes can have dherent eves of decomposton.
# Excessve decomposton can ead to non-productve management ehort, nemcent use of resources, and decreased emcency n performng the work.
# Decomposton may not be possbe for a deverabe or subpro|ect that w be accompshed far nto the future.
# :ork Performance 1nformation? Focus on :D5! has been done (provdeds nformaton on the Status of a Deverabes).
# Performance .eports? Focus on DO: t was done. (Focus on Cost, Tme, and Ouaty performance). Here Actua Resuts are compared aganst the Basenes to show
how the pro|ect s performng aganst the Pan.
# Resdua Rsks comprse of 5 +isk that remain after applying risk response strategies, and 7 +isks that we simply A22AP' 1 if it happens, it happens, we have a plan to
deal with it
# Contngency Pans dea wth the outcome of Resdua Rsks on pro|ect. # Contngency Resvers cover the outcome of Resdua Rsk, and account for the "Known
Unknowns".
# Faback Pans are empoyed for Resdua Rsks when the Contngency Pans fa. # Secondary Rsks are new rsks that emerge as a resut of Rsk Response Pan.
# Watchst: A non-crtca/non-top/ow ratng rsks are put on the Watchst and montored(Watched) reguary. It s created at Perform Ouatatve Rsk Anayss Process. #
Management Reservers account for the "Unknown Unknowns".
# Utility !heory? An approprate method for descrbng Rsk Toerance. * Rsk Averse: Where there s more money at stake, the Rsk Averter's satsfacton dmnshes; he
or she prefers a more certan outcome and demands a premum to accept pro|ects of hgh rsk. * Rsk Neutra: Toerance for rsk remans the same as the money at sake
ncreases. * Rsk Seeker: The hgher the stakes, the better; as rsk ncreases, the rsk seeker's satsfacton ncreases; he or she s even wng to pay a penaty to take on
pro|ects of hgh rsks.
# -orce Ma2eure .isks, such as Earthquakes, Foods, Acts of Terrorsm, Etc., shoud be covered under Dsaster Recovery Procedures nstead of Rsk Management.
# Monte 4arlo 5nalysis woud show you s WHERE SCHEDULE RISK EXISITS (Ponts of Schedue Rsk). It s a Computer-based Anayss & usefu for reveang Schedue
Rsks
1n accordance #ith the Planning process group, the order of processes are? develop pro2ect management plan, collect reHuirements, deAne scope,
create :B, deAne activities, seHuence activities, estimate activity resources, estimate activity durations, develop schedule, estimate costs,
determine 0udget, plan Huality, develop D. plan, plan communications, plan risk management, identify risks, perform Hualitative risk analysis,
perform Huantitative risk analysis, plan risk responses, and plan procurementsN
What s the meanng of a concept caed the "|ourney to Abene"?
Commttee decsons can have the paradox outcome, that a |onty made or approved decson s not desred by any ndvdua group member.
What s a constructve change?
A drecton by the buyer or an acton taken by the seer that the other party consders an undocumented change to the contract.
Lqudated damages (LDs) are contractuay agreed payments n order to.
...cover the customer's costs caused by ate competon or faure to meet speccatons by the contractor.
27/42
1MPO.!53! PO13! C )
lJ 1ntroduction to Pro2ect Management
1 A pro|ect s a temporary endeavor to create a unque product or servce. Operatons are ongong actvtes.
2
3 Mestones are not competed by the pro|ect manager, but by the pro|ect team. In addton, mestones are the resuts of actvtes, not actvtes themseves.
4 Pro|ect cosure s aso known as the pro|ect postmortem.
5 The pro|ect scope denes the requred work, and ony the requred work, to compete the pro|ect.
6 Scope vercaton s the proof that the pro|ect manager has competed the pro|ect.
7 Whenever you have access to hstorca nformaton, ths s your best source of nput.
8 Ouaty pocy s the organzaton-wde rues and requrements for quaty.
9 The pro|ect manager shoud use approved rewards and ncentves to move the pro|ect team towards competon.
10 An nformaton retreva system s paramount for a pro|ect wth so much documentaton. Techncay, a pro|ects shoud have an nformaton retreva system.
11 The contract between the organzaton and the vendor supercedes a other work-reated documents.
12 Programs are a coecton of pro|ects wth a common cause.
13
14 Busnesses exst to make money.
15 Customers, nterna or externa, are the most mportant stakehoders n a pro|ect.
16
17
18
19
20
21 The pro|ect coordnator reports to a hgher-eve manager and has authorty to make some decsons. The pro|ect expedter has no authorty to make decsons.
22
23 Ehectve pro|ect management requres a fe cyce approach to runnng the pro|ect.
24 The PMO determnes whether a pro|ect supports the organzaton's strategc pan and can authorze exceptons to pro|ects not nked to the strategc pan.
25
26
27
28 Deverabes are determned n part by the customer, but not the sponsor.
29
30 The pro|ect manager or the pro|ect management team determnes how best to accompsh the pro|ect.
31 The organzaton has a drect nuence on the pro|ect. A partcpatve approach w probaby not be as ehectve n a herarchca organzaton.
32 Durng the montorng and controng process group, pro|ect performance s measured, and needed changes are dented and approved.
33
34
35
lJ Examining the Pro2ect Management -rame#ork
1 The pro|ect fe cyce s comprsed of phases.
2
3 Managng has to do wth consstenty producng key resuts that are expected by stakehoders.
4 Ema s not a Forma Communcaton.
5 Arbtraton s a form of negotaton. Techncay, t s a form of asssted negotaton.
6
7
8
9
10 Pro|ects wth much rsk and reward are most key to be accepted wthn an entrepreneura organzaton.
11
12
lJ Examining the Pro2ect Management Processes
1 A process s a seres of actons brngng about a resut. Reca that processes exst n pro|ects and n pro|ect phases.
2 Product-orentated processes are unque to the product the pro|ect s creatng.
3
4
Progressve eaboraton s the process of takng a pro|ect concept through to the pro|ect pan. As the pannng and research actvtes contnue, the more detaed
and focused the concept becomes. Progressve eaboraton happens throughout the pro|ect. It s the process of eements wthn the pro|ect becomng more and
more exact as addtona nformaton and detas become avaabe.
Pro|ect Portfoo Management s the process of choosng and prortzng pro|ects wthn an organzaton. An exceent pro|ect dea can st be dened f there are
not enough resources to compete the pro|ect work.
Gettng coectve acton from a group of peope who may have qute dherent nterests s 'Politics'.
Generay, a dherence n requrements resoved n favor of the customer. However, t s the pro|ect manager's responsbty to nform the customer of other
optons.
The pro|ect management omce can be estabshed to oher servces rangng from basc support to tota management of a pro|ects. Choce D covers the dverse
opnons of management, and w meet a ther needs.
You mght remember a smar queston wth a dherent answer. Operatons and mantenance actvtes are not part of pro|ects. The work to coect data, meet
wth operatons and mantenance to expan the pro|ect, and other such actvtes shoud be ncuded n the pro|ect.
Management 0y o02ectives tres to focus a actvtes on meetng the company's ob|ectves. If the pro|ect's ob|ectves are not n ne wth the company's
ob|ectves, the pro|ect may be mpacted or canceed.
The key word here s "cross-dscpnary." Cross-dscpnary means that the pro|ect covers more than one department or technca area of expertse. In such a
case, a matrx organzaton s needed wth representatves from each department or dscpne.
The work of competng the product scope s accompshed durng the executng process group.
It s a responsbty of the pro|ect management omce to prortze the company's pro|ects. When prortzaton s cear, t s easer to aocate resources among
pro|ects.
Notce that ths queston asks about product vercaton, not scope vercaton. !he Berify cope process occurs during pro2ect monitoring and
controlling, and product veriAcation is done during pro2ect closingN
The best answer s stakehoders, as ther nput s crtca for coectng a the essons earned on each pro|ect. The term "stakehoders" ncudes a the other
groups
!he pro2ect charter gives authori7ation to 0egin a pro2ect or pro2ect phaseN The pro|ect charter s approved n the ntatng process group.
The competon of a pro|ect phase may aso be known as a k pont or stage gate. K ponts are typcay at the end of a pro|ect phase. A k pont does not
mean the pro|ect s ked, |ust that the potenta for termnaton exsts.
To nuence an organzaton (n order to get thngs done), a pro|ect manager must understand the expct and mped organzatona structures wthn an
organzaton.
Rumors and gossp can sabotage a pro|ect. Ths s an exampe of cutura achevabty.
Ext crteron are actvtes or evdence that aow a pro|ect to move forward. Stakehoder expectatons are unversa to the entre pro|ect, not |ust to one pro|ect
phase.
Pro|ects typcay have ow costs and ow demand for resources eary n ther fe cyce. As the pro|ect moves coser to competon, the kehood of rsk
dmnshes
Rong wave pannng s a descrpton of the pannng process n most arge pro|ects. It requres the pro|ect manager and the pro|ect team to revst the pannng
process to address the next phase, mpementaton, or pece of the pro|ect.
By nvovng the stakehoders at dherent aspects of the pro|ect, ther requrements are more key to be met. Speccay, scope vercaton ensures that the
stakehoders are seeng that phase deverabes, pro|ect progress, quaty, and expectatons are beng met.
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5 Organzatona pannng s the factatng pannng process whch denes roes and responsbtes-and the reportng structure wthn the pro|ect.
6
7
8
9
lJ Pro2ect 13!E<.5!1O3 Management
1 Pro|ects are seected based on busness needs rst.
2
3
4 The pro|ect sponsor can hep the pro|ect manager and the stakehoders resove ssues durng pro|ect ntegraton management.
5
6
7 A pro|ect basene serves as a contro too. Pro|ect pan executon and work resuts are measured aganst the pro|ect basenes.
8 Gantt charts are exceent toos to measure and predct the pro|ect progress, but are not needed durng the pro|ect pan deveopment process.
9
10 The pro|ect pan serves as a gude to a future pro|ect decsons.
11 A conguraton management s the documentaton of the pro|ect product, ts attrbutes and changes to the product.
12 Integrated Change Contro s a system to document changes, ther mpact, response to changes, and performance dects.
13 The pro|ect pan s the forma document used to manage and contro pro|ect executon.
14
15 EVM, earned vaue management, s used throughout the pro|ect processes. It s a pannng and contro too used to measure performance.
16
17 Conguraton management nvoves makng sure that everyone s workng oh the same documents and verson.
18
19 Ehectve pro|ect ntegraton usuay requres an emphass on: Ehectve Communcatons at key nterface ponts.
20 Wth everythng gong we on the pro|ect, the ony choce that makes sense s to revew the management pans for the pro|ect.
21
22
23
24
25
26
27 Constraned optmzaton uses mathematca modes. Lnear programmng s a mathematca mode.
28
29
30 Whenever a arge number of changes occur on a pro|ect, t s wse to conrm that the busness case, as stated n the pro|ect charter, s st vad.
31 Present Vaue (PV): We convert a future cash ow nto a vaue today. Ths aows us to DIRECTLY compare two future cash ows.
32
33
34 Remember, the nterna rate of return s smar to the nterest rate you get from the bank. The hgher the rate s, the better the return.
35 Meetng the basene s one ndcator of pro|ect success.
36 Recoectons (of nformaton) are ess reabe than other documented resuts.
37
38
39 You want to capture data at the end of each phase of a pro|ect. If you wat unt the end, you may forget mportant nformaton.
40
41
42
43 It s the sponsor's roe to determne ob|ectves. These ob|ectves are descrbed n the pro|ect charter.
44 The pro|ect charter s ssued by the sponsor. The pro|ect manager may have a roe n ts creaton.
45
On a pro|ect wth 45 key stakehoders, the pro|ect manager must work to manage stakehoder expectatons. Gven the mpact of the pro|ect and the dented
controversy, the pro|ect manager w need to proceed wth cauton to ensure the pro|ect deverabes meet the requred expectatons of the stakehoders.
Pro|ects fa at the begnnng, not the end. A poor requrements document, nadequate needs assessments, unfued pannng, and more eary processes can
contrbute to pro|ect faure.
Change requests do not aways requre more money. Approved changes may requre more funds, but not aways. The change request may be dened, so no
addtona funds are needed for the pro|ect.
A forma, documented change request s the best course of acton for a change request stemmng from a aw or reguaton. Integrated Change Contro requres
deta for mpementng the change. Wthout evdence of the need for the change, there s no reason to mpement t.
If management has assgned the pro|ect constrant of a xed budget, the pro|ect manager and the pro|ect team must determne how the pro|ect can operate
wthn the constrant.
Pro|ect pans communcate to the pro|ect team, the pro|ect sponsor, and stakehoders. O: The prmary purpose of your pro|ect pan s: A: To provde accurate
communcaton for the pro|ect team, pro|ect sponsor, and stakehoders.
A PMIS can assst the pro|ect manager the most durng pro|ect executon. It does not repace the roe of the pro|ect manager, but ony serves as an assstant. It
heps the pro|ect manager pan, schedue, montor, and report ndngs.
Genera management sks, status revew meetngs, and Work Authorzaton Systems are the best toos descrbed here that serve as part of the pro|ect pan
executon.
A pro|ect manager must manage a pro|ect. If a actvtes are deegated, chaos ensues and team members w spend more tme |ockeyng for poston than
competng actvtes.
The schedue basene s there for you to determne how the pro|ect s progressng. Foow your change management process, and contnue to track aganst your
basene.
The change contro system must aso ncude procedures to hande changes that may be approved wthout pror revew, for exampe, as the resut of
emergences.
Ony wth formal acceptance can the pro|ect manager be sure the pro|ect work s reay compete.
A !echnical :ork is completed "means you are in 4losing Process <roup$ on the pro|ect - the remanng thng s 'Competng Lessons Learned'.
Because net present vaue s the vaue n today's doars of dherent cash ows, the pro|ect wth the hghest NPV s the best one. The number of years s
ncuded n the NPV cacuaton.
1ntegration can be done durng Pannng and Executng, but t s most mportant when you reach key interface points n the pro|ect. You must orchestrate the
comng together of the resuts.
The sponsor ssues the pro|ect charter and so he or she shoud hep the pro|ect manager control changes to the charter. The primary responsi0ility lies
#ith the sponsor.
Most often, pro|ects outsourced outsde of the country encounter communcaton and tme zone barrers. The procurement process shoud have assured the
pro|ect manager that the seers were sked.
Drectng (choce A) occurs whe the pro|ect management pan s beng created. Durng pro|ect executng, the pro|ect manager shoud be focused on ntegratng
the work of others nto a cohesve whoe. Ths s more mportant than |ust coordnatng (choce C) or eadng (choce D).
The arger the BCR, SPI and CPI the better. A pro|ect wth high priority normay hods more senor commtment.
Integrated change contro requres coordnatng changes across knowedge areas. For exampe, a proposed schedue change w often ahect cost, quaty, rsk,
and resources.
Change Contro Procedure mght address how to hande changes, but does not reect approved changes. Changes made va the change contro system w be
documented in some part of the pro2ect management plan and/or pro2ect documents.
Remember, pro|ect ength s ncorporated when computng NPV. You woud choose the pro|ect that provdes the most vaue, n ths case the pro|ect wth the
hghest NPV.
A work authorzaton system s used to coordnate when and n what order the work s performed so that work and peope may propery nterface wth other
work and other peope.
O: When shoud the Pro|ect Basenes be changed? A: For a Approved Changes.
Sometmes, certan casscatons of changes get automatc approva on a pro|ect and do not need a change contro board's approva. For exampe, n an
emergency, changes shoud be made by the pro|ect manager wthout the change contro board.
Changes can be made to the basenes, but ony when they are omcay approved.
The bggest probem s retanng team members unt cosure of the pro|ect. Peope start ookng for ther next pro|ect and eave before admnstratve cosure s
compete.
Once the change has been made by the Pro|ect Manager, you need to update the documents ahected by the change; the pro|ect management pan and/or
pro|ect documents.
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46 A pro|ect wthout a charter s a pro|ect wthout support.
47 A poor communcatons management pan s not key to cause the voume of changes n ths nstance.
48 It s the pro|ect manager's responsbty to manage the pro|ect scope competon wthn budget and reserves.
49 The pro|ect manager oses credbty and performance by usng overtme.
50 Before anyone can be noted, the change must be nshed. That means ookng for tme, cost, quaty, rsk, resources, and customer satsfacton mpacts.
51
52
53
54
55 A change management pan ncudes the processes and procedures that aow smooth evauaton and trackng of changes.
56
57 Prmary Responsbty of the Pro|ect Manager s 'Interact wth others n a Professona Manner whe competng the pro|ect'.
58 The change contro system shoud aready have methods of makng changes descrbed.
59
60 A types of cosure must make sure that the actua product of the pro|ect meets the requrements for the product.
61 The Pro|ect Manager shoud oher your assstance wthout dong the work of the other Pro|ect Manager.
62
63
64
65
66
67 The pro|ect manager s an ntegrator. Ths s a queston about your roe as an ntegrator and communcator.
68 A the pro|ect documentaton goes nto the archves. Therefore, t must be competed. The archve s the ast thng to create before reeasng the team.
69
lJ Pro2ect 4OPE Management
1
2 The pro|ect team member dd not foow the change management pan's method of ncorporatng changes nto the scope.
3 The responsbty to ensure that the pro|ect work s authorzed, contracted, and funded rests wth the pro|ect manager.
4
5 The stakehoders determne the pro|ect requrements and decde whether the pro|ect was a success.
6
7 Team buy-n s a drect resut of the WBS creaton process.
8
9
10
11
12
13 A team member shoud have exbty at the work package eve to make some changes as ong as they are wthn the overa scope of the WBS dctonary.
14
15 The pro|ect manager shoud vadate wth the customer that the change w add vaue, and then foow the change process.
16 Much of the work on the pro|ect s dctated by the pro|ect scope statement. Any mprecson n such a key document w ead to dherng nterpretatons.
17 The scope management pan descrbes how requested scope changes w be managed.
18
19 Work not n the WBS s outsde the scope of the pro|ect.
20
21
22
23 A submtta that does not meet the requrements shoud not be accepted.
24
25
A snge hgh-eve executve can end an entre pro|ect f he or she s not satsed wth the resuts, even f that person has, by choce, been ony tangentay
nvoved n the pro|ect. It s crtca to ensure that a of the na decson makers have been dented eary n a pro|ect n order to ensure that ther concerns are
addressed.
Before you can do anythng ese, you have to know what YOU are gong to do. Deveopng the management strategy w provde the framework for a the rest of
the choces presented and the other actvtes that need to be done.
The change management process shoud be forma so changes don't "|ust happen." You manage them. You want them documented for hstorca purposes so
there s an audt tra ndcatng why you made the changes.
A pro|ect s compete when a work, ncudng a pro|ect management work, s compete and the product of the pro|ect, not |ust deverabes, accepted. The
essons earned are pro|ect management deverabes.
Ony a work authorzaton system heps wth ntegratng work packages nto a whoe. A work authorzaton system heps ensure that work s done at the rght
tme and n the rght sequence.
Haf the pro|ect s done and haf the cost has been expended. The answer s smpe. Or s t? In fact, you do not know what was panned, so you cannot answer
ths queston.
Documents that serve as hstorca records for future pro|ects' are coected throughout the pro|ect, but are ony archved durng the Cose Pro|ect or Phase
process.
Outputs of the Cose Pro|ect or Phase process ncude archves, essons earned, and pro|ect cosure. However, some pro|ect resources (peope, computers,
teephones) must be used to perform these cosng actvtes. Once competed, the pro|ect can reease ts resources.
A pro|ect manager shoud be ookng at where changes are comng from and dong whatever s necessary to mt the negatve ehects of change on the pro|ect.
He needs to nd the root cause, so future changes may be avoded.
One of the ways to check f a change shoud be approved s to determne whether the work fas wthn the pro|ect charter. If not, t shoud be re|ected, assgned
to a more approprate pro|ect or addressed as a pro|ect of ts own.
A work authorzaton system (choce A) heps te the team when work shoud begn on work packages. A change contro system (choce B) heps track, approve
or re|ect, and contro changes. A pro|ect management nformaton system (PMIS - choce D) heps the pro|ect manager know how the pro|ect s gong. Ony a
conguraton management system (choce C) addresses controng documents.
Most change requests are a resut of Vaue-added change. Vaue added change centers on addng some eement that was not avaabe to the pro|ect scope to
reduce costs at scope creaton.
Scope statements must at east ncude the quantabe crtera of cost, schedue, and quaty metrcs. The scope statement serves as a pont of reference for a
future pro|ect decsons.
After the customer's nput, the performng organzaton's pro|ect team s responsbe for scope basene preparaton. The scope basene ncudes the WBS, WBS
dctonary, and pro|ect scope statement.
!he heuristic "rule of thum0$ we use n pro|ect decomposton s P& hours. It doesn't matter how experenced the team members are. You need ths eve of
reportng to manage the pro|ect ehectvey.
The pro|ect manager must factate a far and equtabe souton, but the customer is the Arst of eHuals.
Decomposng: The mportant words here are "pro|ect work packages". Ths ndcates that a WBS has aready been created. If the queston sad "pro|ect
deverabes," the answer woud have been 'Creatng a WBS'.
!he num0ering system aows you to qucky dentfy the eve n the work breakdown structure where the specc eement s found. It aso heps to ocate the
eement n the WBS drectory.
5 change reHuest s the most ehectve way of handng the dsconnect between what users actuay want and what management thnks they want.
1nformal changes to pro2ect scope and plan are probaby the chef cause of schedue sppage, cost overruns and pro|ect team member frustraton.
Ehectve scope contro s crtca to the success of a pro|ect.
!he level of uncertainty in scope increases based on the scae of ehort requred to dentfy a the scope. -or larger pro2ects it is more di=cult to
UcatchU everything.
cope veriAcation focuses on customer acceptance of a deverabe whe product veriAcation s focused on makng sure a the #ork is completed
satisfactorily.
The Verfy Scope process s done at the end of each phase of the pro|ect. If t s not done, you rsk deverng somethng n the next phase that s not acceptabe
to the customer.
Eou need to Arst understand the change 0efore you can evaluate it. In ths nstance, verba communcaton s not key to provde enough nformaton to
evauate. Once you understand the change, you can work wth the team to determne the mpact and optons.
4ustomers do not generally approve the pro2ect scope "#hat you are going to do to complete their reHuirements$X instead, they approve the
product scope "their reHuirements$
-ait accompli - Commony used to descrbe an acton whch s competed before those ahected by t are n a poston to query or reverse t.
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26
lJ Pro2ect !1ME Management
1 GERT, Graphca Evauaton and Revew Technque, aows for condtona advancement. GERT aows for branchng and oopbacks.
2
3 Soft ogc aows the pro|ect manager to make decsons based on condtons outsde of the pro|ect, best practces, or gudenes.
4 Commerca duraton estmatng databases are vad resources to conrm or base tme estmates upon.
5 Parknson's Law states that work w expand to fu the tme aotted to t.
6
7
8 Mestone Schedue can aso be caed as Master Schedue.
9 The arrow dagrammng method does not support nsh-to-nsh of reatonshps.
10
11 The crtca path does not change f the scope s the same. A more aggressve deadne smpy means the pro|ect s two weeks behnd.
12 The wder the range between the optmstc and pessmstc estmates n a three-pont estmate, the more uncertanty the estmator has.
13
14
15
16
17
18
19
20
21 Leveng resources generay extends the schedue. Resource eveng refers to keepng the number of resources the same and ettng tme and cost be exbe.
22
23 A mestone shows the competon of a seres of actvtes or work packages. Therefore t takes no tme of ts own.
24 Parametrc estmatng does not make use of estmates from the team.
25 Pro|ect network dagrams are schematc dspays of the ogca reatonshps among actvtes.
26 You do not necessary need to change the schedue, uness, of course, the deay s more than the actvty's oat.
27 The ony certan mpact of a scope change s a schedue change to shorten or engthen subsequent actvtes.
28 There s no reason to thnk the pro|ect s gong we or poory based soey on oat.
29
30 More nterdependences on a pro|ect ncrease the need for communcaton.
31 GERT s the ony dagrammng technque that aows oops.
32 A heurstc s a rue of thumb. Exampes are cost per ne of code, cost per square foot of oor space, etc.
33 The prmary purpose of a network dagram s to show ogca reatonshps.
34 A Monte Caro anayss provdes the abty to compute the probabty of competng a pro|ect on a specc day.
35
36
lJ Pro2ect 4O! Management
1
2 Vaue anayss/engneerng s a systematc approach to nd ess costy ways to compete the same work.
3 The cost management pan contros how cost varances w be managed.
4
5
6 The Pro|ect Budget and Basene w not be nazed and accepted unt the pannng processes are competed.
7 A Cost Management Pan contans a descrpton of: The WBS eve at whch Earned Vaue w be cacuated.
8
9
10
u0nets are often ncuded n network tempates to summarze common actvtes n a pro|ect.
Rather than boat actvtes, pro|ects shoud use contngency reserve. Contngency reserve s a porton of the pro|ect schedue aotted for tme overruns on
actvtes.
A Gantt chart s a bar chart that represents the duraton of actvtes aganst a caendar. The ength of the bars represent the ength of actvtes whe the order
of the bars represent the order of actvtes n the pro|ect.
Pro|ect pannng (choce A) woud use both types of charts. Team members (choce B) need to see detas and so they need a bar chart rather than a mestone
chart. Rsk anayss (choce D) COULD make use of both charts. A mestone chart s used nstead of a bar chart for any stuaton where you want to report n a
ess detaed way (choce C). Bar charts can scare peope wth ther compexty and often show too much deta to be worthwhe on a management eve.
Mestone charts are more ehectve for reportng to management.
In addton to the Pro|ect Management Pan, the pro|ect team must create "Management plans document how the team w manage on a more detaed eve.
Exampes of management pans ncude pro|ect scope, schedue, cost, quaty, and rsk management pans".
A Dscretonary Dependancy n one that base on: Experence (Based on essons we earned from past pro|ects or from our past experence, we prefer to do
actvtes n a certan order).
Assumng the pro|ect manager s meetng the pro|ect ob|ectves and constrants, sponsor approva of a detaed schedue (choce A) s not as crtca as that of
functona managers. The customer (choce D) does not need to approve the detaed pro|ect schedue, |ust the end date and any mestones they mght mpose.
The team (choce B) woud at east have provded ther estmates. Gettng functona managers to approve w aso, ndrecty get team members' approva.
Remember that the book PMP Exam Prep says to assume a matrx organzaton. If functona managers knew what each of ther peope were dong, the
tmeframe, and when ther actvtes were on the crtca path, resource probems woud not be as frequent. Approva of the schedue by functona managers
provdes the most benets.
The queston s reay askng, "What s done after Estmate Actvty Duratons?" chedule compression occurs 0efore Anali7ing the schedule.
Many peope forget to make use of the toos of pro|ect management pannng whe the pro|ect work s ongong. Do not make that mstake. A network dagram
does hep you track ow, but t shoud be the ow of the work, not nformaton (choce A). The network dagram has nothng to do wth cost (choce C) or reward
systems (choce D). The network dagram heps you know when work on the pro|ect shoud be done and n what order.
Thnk of what you woud do n the rea word. Many pro|ect managers |ust ask for more resources or more tme (choces B and C),. Askng for an extenson of
tme s generay the best thng to do ony when scope s added to the pro|ect. Addng resources w add cost. Choce D shoud be the ast choce. Compressng
the schedue ets you get more done wth the resources and tme that you aready have on the pro|ect. It s amost aways the rst thng to do when there s a
deay generated from wthn the pro|ect.
You must change the crtca path norder to shorten the pro|ect duraton. In ths case, both actvty C and actvty H are on the crtca path. If you have a choce,
a thngs beng equa, choose the earlier option. Therefore, actvty C s the best answer.
Standard devaton s a range that an estmate can vary +/- from the mean. The pro|ect needs to be done n 40 days, and the schedue cas for 38 days, so the
pro|ect oat s 2 days. Wth a standard devaton of two days, the pro|ect w take 38 +/- 2 days, or 36 to 40 days. Therefore, pro|ect oat coud be 0 to 4 days.
Standard Devaton tes you how unsure the estmate s.
Correctve acton s anythng done to brng expected future schedue performance n ne wth the pro|ect management pan. Such acton shoud aways be an
output.
"Pro|ect management" software s not desgned to do a good |ob of creatng a WBS. It cannot create a compete pro|ect management pan, nor can t manage a
compete pro|ect. 1t is designed to create and control schedulesN
When the pro|ect s competed eary, the pro|ect manager shoud report that the pro|ect came n ahead of tme and expan WHY. Ths s a success! If there was
proper pro|ect pannng, ths shoud occur because an expected rsk dd not materaze.
The earnng curve aows the cost to decrease as a resut of decreased nstaaton tme as workers compete more of the nstaaton procedure. As the pro|ect
team competes more and more unts, the tme to compete a hote room shoud take ess and ess tme.
-unding limit reconciliation most key w ahect the pro|ect schedue, snce work w need to be moved to when funds w be avaabe.
5 /eAnitive Estimate? The most expensve to create (A great dea of work s needed to ne tune a pro|ect so that you can get a dentve estmate).
!he varia0le and direct costs are most ahected by the sze and scope of the pro|ect. Indrect costs are usuay computed as a percentage of drect costs.
Balue analysis s a way of ndng the east expensve way to do the work.
!he life cycle cost #ill provide the picture of the total cost of the pro2ectN It ncudes pro|ect costs and operatons and mantenance costs.
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11
12
13
14
lJ Pro2ect @U561!E Management
1 The pro|ect team (the ndvduas competng the pro|ect work) s responsbe for the quaty of the pro|ect deverabes.
2 Interna faure cost s attrbuted to faure that resuts n rework. It s an exampe of the cost of nonconformance to quaty.
3 OC requres an nspecton of the work resuts. Whe quaty s panned nto a pro|ect, nspectons ensure t exsts. OA s typcay a management process.
4 ISO 9000 s not a quaty management system, but a system to ensure an organzaton foows ts own quaty procedures.
5 Kazen technooges are sma changes to processes and products on a steady, contnuous bass to save costs and mprove quaty.
6 Ouaty, n regard to the pro|ect scope, s about competng the work as promsed.
7
8 Desgn of experments uses experments and 'what-f' scenaros to determne what varabes are ahectng quaty.
9 Checksts are smpe but ehectve quaty management toos that the pro|ect manager can use to ensure the pro|ect team s competng the requred work.
10
11
12
13 Data ponts outsde the contro mts ndcate the process s out of contro, and producton shoud be stopped unt a souton s found.
14
15
16
17
18 The Perform Ouaty Assurance process s the process n whch we do quaty audts to make sure we are usng the correct processes.
19 Ouaty management shoud be performed reguary and n parae wth other pannng processes throughout the pro|ect.
20
21
22
23 Standard devaton s the measurement of a range around the mean.
24
25
26
27 Athough quaty pannng usuay occurs durng pro|ect pannng, sometmes we need to go back to pannng from other processes to make a decson.
28
29 A data pont that requres you to determne the cause of the probem cas for a speca cause.
30 The contro mts are set based on the company's quaty standard and ndcate the acceptabe range.
31
32
33 You can use the WBS (choce C) n many ways to contro quaty.
34 Inconsstency and nonpredctabty are ndcatons that the process s out of contro.
35
36
lJ Pro2ect D. Management
1 When pro|ects are smar n nature, the pro|ect manager can use the roes and responsbtes dentons of the hstorca pro|ect to gude the current pro|ect.
2
3
4
5
6
!raining 4osts? You are tranng the team on sks requred for the pro|ect. The cost s drecty reated to the pro|ect and thus a direct cost.
-ringe 0eneAts are ncuded n overhead and are part of indirect costs.
A fu-tme team member who competes her work sooner than panned coud be forced to wat for the start of her next actvty. Snce she s fu tme, she woud
have to be pad for tme not workng.
O: Optma quaty s reached at what pont? A: When revenue from mprovement equas the ncrementa costs to acheve the quaty. E: Margna anayss
provdes that optma quaty s reached when the cost of the mprovements equas the ncrementa costs to acheve the quaty.
Ouaty attrbutes are the measurements that determne f the product s acceptabe. They are based on the characterstcs of the product for whch they were
desgned.
Perform Ouaty Assurance nvoves determnng whether standards are beng foowed. Ths woud be the east ehectve, snce t does not address the specc
probem descrbed n the queston.
The ony choce sted that makes sense and s an omca nput to Perform Ouaty Assurance s choce C. Ths queston s smar to others n ths program but not
exacty the same. You may aso see ths occur on your exam. Carefuy read the questons!
nspectons may be conducted at any eve ncudng the pro|ect team, and at any tme throughout the product deveopment. They are used to prevent defects
from beng devered to the customer.
Deveopng speccatons shoud come from a technca expert. The ony choce sted that meets that descrpton s engneerng. Not every queston on the
exam w requre that a pro|ect manager do the work.
Benchmarking s the common term for a performance measurement standard.
!rend analysis examnes pro|ect resuts over tme to evauate performance.
A good pro|ect manager w nd the root cause and dea wth that, even f t means attemptng to mprove the company's poces and processes. Ths s
contnuous mprovement. Because there are severa actvtes ahected by the pocy, t woud serve the pro|ect better to get to the root cause of the probem
and sove t.
DOE: Proper desgn aows you to nd those factors that have the most mpact on quaty. It aows the pro|ect manager to focus attenton on the factors that are
most mportant.
Even though t s occurrng durng the executon of the pro|ect, determnng what standards to use s part of quaty pannng. We sometmes need to fa back
nto pannng durng other parts of a pro|ect. In pannng, we determne what quaty standards are appcabe to the pro|ect and how to mpement and contro
them.
The contro mts are more constranng than the speccaton mts. Contro mts are how you measure your process quaty. Speccaton mts are how the
customer measures quaty.
!he Ash0one diagram s a too that we use to hep stmuate thnkng (branstormng), to create an atmosphere conducve to open sharng of thoughts, and to
gather our thoughts n a cohesve way. It can be used durng anayss to determne the cause of defects.
Ths can be a trcky queston, n that most pro|ect managers dsmss the need to focus on quaty. Ouaty, cost, and schedue shoud be consdered of equa
mportance uness specc pro|ect ob|ectves make any one of them most mportant. Ouaty, cost, schedue, scope, rsk, and other factors may be prortzed
dherenty on each pro|ect.
As you ncrease quaty, there w be assocated benets for the pro|ect. Some of these benets are ncreased productvty, ncreased cost ehectveness,
decreased cost rsk, and mproved morae.
Dscoverng non-vaue actvtes s part of process anayss: mpementng the process mprovement pan. Many peope choose to perform a quaty audt (choce
C). However, performng a quaty audt reates to determnng whether you are usng the rght processes and whether those processes are ehectve, rather than
mprovng processes.
The group s usng organzatona process assets to mprove ther pro|ect. Athough the ncdent |ust occurred, t was on another pro|ect. They are n the Pan
Ouaty process.
Havng an allo#a0le defect rate is an example of the cost of nonCHuality. Any system or process that w accept defects adds cost to the product or
servce.
When pro|ect managers, or managers n genera, are referred to as dherent terms, a |ob descrpton s needed so the pro|ect manager can successfuy
compete the requred obgatons.
!he halo eLect s the assumpton that because the person s good at a technoogy theyd aso be good at managng a pro|ect deang wth sad technoogy.
O: Susan s the pro|ect manager for the PMG Pro|ect. She makes a decsons on the pro|ect team regardess of the pro|ect team ob|ectons. Ths s an exampe
of whch of the foowng management styes? A: Susan s an autocratc decson maker.
When Harod aways has to wn an argument and team members begn to gve nto Harods demands smpy to avod the argument rather than to nd an
accurate souton, ths s a yed-ose stuaton.
The Expectancy Theory descrbes how peope w work based on what they expect because of the work they do. If peope are rewarded because of the work
they compete, and they ke the reward (payment), they w contnue to work.
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7
8 A reward and recognton system nvoves forma management acton to promote desred behavor of ndvduas.
9
10 There s aways the opton to smpy postpone deang wth the ssue unt ater. Ths s wthdrawng.
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12 Keep n mnd that the stamng management pan s created as part of Deveop Human Resource Pan and updated as part of Acqure Pro|ect Team.
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14 Stamng Management Pan: WHEN and HOW resource w be ADDED and TAKEN OFF the team.
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20 Smoothng w emphasze that everyone agreed on a pan and that the team shoud have condence n that pan.
21 The roe of each stakehoder s determned by: The Pro|ect Manager and The Stakehoder.
22 Top four sources of conct: schedues, pro|ect prortes, resources, and technca opnons
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28 Functona management s responsbe for addressng ndvdua performance probems.
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32 Technca ssues of the pro|ect are managed by the team members' managers (Functona Managers).
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36
lJ Pro2ect 4OMMU3145!1O3 Management
1 Communcatons Management Pan detas the requrements and expectatons for communcatng nformaton among the pro|ect stakehoders.
2 A communcaton matrx s an exceent too to dentfy the stakehoders and ther requrements for communcaton.
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11 The transfer of knowedge s evdence that communcaton has occurred.
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18 Understandng the recever's perspectve aows you to drect the communcaton to meet hs needs.
Forcng happens when the pro|ect manager makes a decson based on factors not reevant to the probem. |ust because a team member has more senorty
does not mean ths ndvdua s correct.
Remember that confrontng means probem sovng and probem sovng s the best way to resove conct ? but not here. The queston asks "what conct
resouton technque woud you IMMEDIATELY use wth the team members." Tempers are too hot and you have the sponsor to dea wth. The best mmedate
choce here s avoidance.
Notce that ths queston taks about what the team member shoud do? It s mportant for the pro|ect manager to understand the team member's roe and
possby even nstruct team members on how to work on pro|ects and what s expected of them. Choces A, B, and C have one thng n common. They nvove
the team member askng the pro|ect manager to do somethng. In reaty, t may very we be the team member who w come up wth a souton (such as
decreasng the scope of the actvty, fast trackng, or specc suggestons about changes to predecessor actvtes). Therefore, choce D s the best choce. But
ask yoursef how you run your pro|ects. Whch s better, your way or ths way? Lasty, pease note that recommended corrective or preventive actions can
come from the team or stakeholders in addition to the pro2ect manager.
A pro|ect manager can rarey te or direct that pro|ect resources be assgned. Most frequenty on pro|ects, the functona manager o#ns the resources.
A pro|ect charter s created durng pro|ect ntatng. A pro|ect manager s assgned durng pro|ect ntatng, not after it.
A histogram is a 0ar chart where each bar represents the percent of time the resource is #orking. Each bar shows one unt of tme (e.g., a week, a
month, etc.). It does not show usage for each actvty or area of expertse. The hstogram s a set of bars that depct when a resource s beng used, and to what
eve.
A corner o=ce s a "perk" whereas health 0eneAts are a fringe 0eneAt.
!raining? The pro|ect manager must ensure that the necessary sks are deveoped as part of the pro|ect.
The toos and technques of the Manage Pro2ect !eam process are observaton and conversaton (watch the team and report on team members'
performance), pro|ect performance apprasas (do a 360-degree feedback sesson), conct management (use approprate conct resouton technques) and
ssue og.
Pro2ect performance appraisals dea wth ho# each team mem0er is performing #ork, rather than how we the team s workng together.
Mentoring? s the work that a pro|ect manager may be frequenty caed on to perform.
Resource eveng refers to mantanng the same number of resources on the pro|ect for each tme perod. Leveng has nothng to do wth assgnng actvtes or
managng meetngs.
After a team member competes pro|ect work, t s the pro|ect manager's |ob to provde nput to the team member's manager regardng performance apprasas.
Performance issues are senor and functona management's responsbty - usuay the manager who supervses the resource.
Pro2ects often need their o#n re#ard systems to ahect performance. Pro|ect managers shoud create such a system for each pro|ect.
Generay, the best forms of power are re#ard or expert. The pro|ect manager has not had tme to become a recognzed expert n the company (choce D)
and reward s not ncuded as a choce here. Ths eaves formal po#er (choce A) as the ony ogca answer.
Dalo ELect? It refers to the tendency of "Move peope nto Pro|ect Management because they are good n ther technca ed". (|ust because a person s good
n hs technca ed does not mean he w aso be a good pro|ect manager).
5 pro2ect organi7ational chart shows resources and ther responsbtes.
A reward needs to be specc to the actvtes at hand to maxmze the ehect. Athough the exstng company reward system (choce A) may work, one created
speciAcally for the pro2ect #ill address pro2ectCspeciAc o02ectives and motivators.
!he Anal steps of pro0lem solving include? mpement a decson, revew t, and conrm that the decson soved the probem.
The gure s caed a communications 0ullKs eye and s used to trgger communcaton needs to management when EVM resuts fa wthn the dented
ranges.
Paralingual s a term used to descrbe the pitch and tone of ones voce.
5n exception report s typcay competed when varances exceed a gven mt.
5dministrative closure shoud take pace at the competon of each phase. Admnstratve cosure s the process of generatng, gatherng, and dssemnatng
pro|ect nformaton.
Pro2ect meetings shoud have a set time limit.
4on>ict s not a ter of communcaton-t s a communcaton hndrance.
Mutua respect and cooperaton s the envronment needed for far and baanced negotiations. Coaboratng s the dea method when negotatng. The goa of
negotatons s to work together for the good of the pro|ect.
When nformaton s sent, t s consdered to be transmitted.
.eport Perfromance s a montorng and controng process, and s aso done durng cosure to report the performance of the pro|ect n the na report.
Expectations are unspoken reHuirements and are often more crtca to a pro|ect's stakehoders than the stated ones. Uness these expectatons are
dented and recorded, there s key to be a hgh eve of dssatsfacton wth the pro|ect.
The work breakdown structure (:B) allo#s communication vertically and hori7ontally #ithin the organi7ation as #ell as outside the pro2ect.
5 user of the pro2ectTs product is al#ays a stakeholder, whe the others may or may not be.
Workng wth peope from dherent cutures, wth dherent cutura vaues and beefs necesstates an understandng both basc dentons and the areas of
cutura mpact. As pro|ect managers, we need to have good communcaton sks and a wngness to adapt to other cutures.
<athering 1nformation is a part of 4ommunication Plan? Wth proper pannng, you w be abe to communcate ehectvey and accuratey. In ths case you
are not gatherng the correct nformaton needed to report to the cent.
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19 Pro|ect Manager wants to more extensvey nvove the Stakehoders on the pro|ect: Have the Stakehoders perodcay revew the st of Pro|ect Requrements.
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26 Progress Reports generay show probems after they have occurred.
27 Stakehoders can be dented throughout the pro|ect management process groups.
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lJ Pro2ect .1K Management
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3 When the scope has been changed, the pro|ect manager shoud requre rsk pannng to anayze the addtons for rsks to the pro|ect success.
4 Monte Caro smuatons can revea mutpe scenaros and examne the rsks and probabty of mpact.
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10 The range of estmates wth the smaest range s the east rsky.
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12 If you cannot determne an exact cost mpact of the event, use quatatve estmates such as Low, Medum, Hgh, etc.
13 Prortzed rsk ratngsare an nput to the Pan Rsk Responses process.
14 Frst, you shoud evauate the mpact of the change. Next, determne optons. Then go to management and the customer.
15 The Rsk Owner shoud be ookng for trggers and mpementng the rsk response strategy.
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17 The rsk response owner s assgned to carry out responses and must keep the pro|ect manager nformed of any changes.
18
lJ Pro2ect P.O4U.EME3! Management
1 A far contract shares a reasonabe amount of rsk between the buyer and the seer.
2 A bonus to compete the work by August 30 s an ncentve.
3 Prvty s a condenta agreement between the buyer and seer.
4 An SOW can be a contract f both partes agree to the SOW and sgn the document as a contract.
5 A snge source seer means there s ony one seer the company wants to do busness wth.
6 An IFB s typcay a request for a seaed document that sts the seers rm prce to compete the detaed work.
7 Procurement documents deta the requrements for the work to ensure compete proposas from seers.
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9 A unatera form of a contract s smpy a purchase order.
10 We decompose the Pro|ect usng a WBS.
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12 Contracts are ega documents and, therefore, generay requre more sgn-ohs.
13 In a xed prce contract, the seer has the cost rsk and therefore wants to competey understand the contract statement of work before bddng.
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15 You need to encourage the cent to reaze that they have a probem and to naze ther requrements.
!he overriding measurement of #hat information to accumulate and communicate on a pro2ect is #hether that information contri0utes to the
success of the pro2ectN The requred nformaton woud take tme away from the pro|ect and not provde added vaue.
5id to solve complex pro0lems, #ritten communication is the 0est? Wrtten communcaton aows your words to be documented, and they w go to
everyone n the same form. When there are compex probems, you want everyone to receve the same thng.
3onver0al communication carries II percent of the message you send. Wth ths much at stake, nonverba communcaton s of ma|or mportance.
!he 0ar chart s the too that shows the schedue at a detaed enough eve for dscusson wth the team.
To ensure cear, concse communcatons, the pro|ect manager must manage communcatons by decdng #hat form of communication is 0est.
Because of the diLerences in culture and the distance 0et#een team mem0ers, formal #ritten communication is needed.
6ateral 4ommunication - Informaton exchange between the pro|ect manager and hs/her peers: functona managers, stah personne, contractors, other
pro|ect managers, etc. Invoves negotatng resources, schedues, and budgets; coordnatng actvtes between groups, as we as deveopng pans for future
operatng perods.
An error vaue of seven percent represents the threshold the pro|ect s aowed to operate under. Shoud the number of errors ncrease beyond seven percent,
the current pastc w be substtuted.
O: A pro|ect manager and the pro|ect team are actvey montorng the pressure gauge on a pece of equpment. Sarah, the engneer, recommends a seres of
steps to be mpemented shoud the pressure rse above 80 percent. The 80-percent mark represents what?
A: The threshod - The 80-percent mark s a threshod.
!he utility function descrbes a person's wngness to toerate rsk.
# -orce Ma2eure .isks, such as Earthquakes, Foods, Acts of Terrorsm, Etc., shoud be covered under Dsaster Recovery Procedures nstead of Rsk
Management.
# Monte 4arlo 5nalysis woud show you s WHERE SCHEDULE RISK EXISITS (Ponts of Schedue Rsk). It s a Computer-based Anayss & usefu for reveang
Schedue Rsks
Notce how many choces are haf rght? Monte Caro coud hep you know that an estmate for an actvty needs to change, but not what the actvty estmate
shoud be (choce B). Monte Caro s a smuaton (choce C) but t smuates tme, not order of actvtes. Monte Caro can be used to prove thngs to
management (choce D) but ts man focus deas wth tme, not stah. Rsk can be assessed usng Monte Caro anayss (choce A). By consderng the nputs to
the PERT estmates and the network dagram, you can obtan a better overvew of the overa pro|ect rsk.
# :orkaround s what you do f the RISK OCCURS, but t does NOT REDUCE THE RISK.
A decson tree aows you to make an nformed decson today based on probabty and mpact anayss. You can decde based on the expected monetary vaue
of each of your optons.
A rsk ratng matrx s deveoped by a department or a company to provde a standard method for evauatng rsks. Ths mproves the quaty of the ratng for a
pro|ects. A rsk ratng matrx s created durng the Perform Ouatatve Rsk Anayss process.
# Expected monetary vaue (EMV) s computed by EMV = Probabty x Impact. We need to compute both postve and negatve vaues and then add them. 0.6 x
$100,000 = $60,000. 0.4 x ($100,000) = ($40,000). Expected Monetary Vaue = $60,000 - $40,000 = $20,000 prot.
# The expected monetary vaue takes nto account the probabty and the mpact. The cacuaton s: (0.05 x 21) + (0.5 x 56) - (0.3 x 28) The ast part s
subtracted because t represents an opportunty and shoud be baanced aganst the threat.
# -orce ma2eure s a powerfu and unexpected event, such as a hurrcane or other dsaster.
For mmedate work, a etter contract may sumce. The ntent of the etter contract s to aow the vendor to get to work mmedatey to sove the pro|ect
probem.
The product descrpton denes the detas and requrements for acceptance of the pro|ect. Ths nformaton aso serves as a vauabe nput to the process of
determnng what needs to be procured. The product descrpton denes what the end resut of the pro|ect w be. When deang wth vendors to procure a
porton of the pro|ect, the work to be procured must support the requrements of the pro|ects customer.
Look agan at the queston. Ask yoursef "How many computers does the contract say?" Dd you read t as twenty (25)? Ths s an exampe of a conct n the
contract. The ntent of the contract can be determned by rememberng that words are more bndng than numbers. Therefore, you shoud return the ve extra
computers.
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16 As the pro|ect manager, you know what the pro|ect rsks are. You need to make sure that provsons are ncuded n the contract to address these rsks.
17 The requrement to provde PMP certed pro|ect managers s a screenng system. A system to mnmze persona pre|udce s a weghtng system.
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19 The pro|ect manager shoud attend the bdder conference.
20 Procurement s a very forma process. Changes need to be fuy documented and sgned by both partes.
21 Remember that PMI's denton of an audt s dherent. Accordng to PMI, audts are used to mprove the processes.
22 Changes n resources used woud generay not be part of a xed prce contract.
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24 Contract that mts fees for arge pro|ects wth mted scope denton s cost pus xed fee.
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26 If the contract s termnated, the pro|ect needs to enter cosure. You need those resuts for hstorca purposes.
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28 A customer's meetng mnutes have no mpact on dsputes that arse; therefore, they are not requred.
29 A seer cannot ssue a change order (athough he coud request one). Generay, ony the buyer can termnate a contract.
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33 Speca provsons take precedence over genera provsons.
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36 Seers are generay requred under contract to keep workng uness tod otherwse.
37 A procurement statement of work may be revsed and rened as t moves through procurement.
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43 If t s not n the contract (whch ncudes the speccatons), a change order s needed to acqure t.
44 Procrastnaton or a ack of pannng on the part of the pro|ect manager does not create an emergency stuaton for the procurement manager.
45 The pro|ect manager must be nvoved to protect the reatonshp between the company and the seer.
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48 Bdder conferences are hed to provde a bdders a cear and common understandng of the work requred.
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50 Seer has the patent for an tem: If the seer goes bankrupt, you w no onger have a source for that matera. You must dea wth ths rsk.
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58 A etter of ntent s not bndng n a court of aw, t does make the seer fee more comfortabe about expendng funds before a contract s sgned.
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Ths s an exampe of privity. Because Companes A and C have no ega reatonshp, Company A cannot drect Company C. The smart thng to do s for the
pro|ect manager of Company A to ca the pro|ect manager from Company B, and have hm communcate the drectve from Company A.
If the seer competes the work speced n the procurement statement of work, the contract s consdered compete. That does not mean the same thng as the
procurement beng cosed. The Cose Procurements process must st occur. However, n ths stuaton, the contract work s competed. Trcky!
There are certan basc thngs that shoud go nto a contracts; an ar0itration (or dspute resouton) cause s one of them. Imagne a stuaton where you have
a dspute, but no pan aready agreed to n the contract!
It s not common for alternatives to be dscussed at the bdder conference. They may be ncuded n bds or proposas and dscussed ater.
Terms and condtons shoud be the resut of a rsk anayss. Ths means the pro|ect manager has been assgned and has competed the rsk management
process before the contract s drafted. Contracts are rsk mtgaton toos!
T & M Contract: Prot s factored nto the houry rate. Therefore, prot s ncreased for each hour worked. If many hours are used, prot can be hgher than a
xed bd contract.
The team members shoud not be requestng deverabes from the seer. However, snce they dd, you must pay for them and revew the procedures wth the
team.
Any tme that a seer does not perform accordng to the contract, the pro|ect manager must take acton. The preferred choce mght be to contact the seer and
ask what s gong on, but that choce s not avaabe here. Therefore, the best choce s to et hm know he s n defaut (choce C).
The ony way to change the cost pus xed fee contract s to negotate a change to the contract, normay n the form of change orders. Change orders shoud
ncude an addtona fee f addtona work s added to the contract.
Dd you notce that the queston descrbed change requests, not changes from other sources? Each of these change requests shoud be weghed to determne
the benets and the mpact on the pro|ect. The crtera shoud be ad out n the procurement and change management pans. The best answer s to approve
changes that benet the pro|ect (choce C). For exampe, a change mght cause a cost ncrease or schedue change, but st resut n an overa benet to the
quaty of the pro|ect.
Ths s a arge ehort. No procurement statement of work can be deveoped, and expertse cannot be found nternay. CPIF woud be an ncentve to the vendor to
perform on or ahead of schedue.
The contract change contro system ncudes a method for controng cost on the procurement.
Ths stuaton s outsde ofyour authorty to contro. You shoud therefore brng enough nformaton to management that they can make a determnaton as to
what to do.
:orkers trike: The stuaton descrbed s probaby a force ma|eure. The approprate response to a force ma2eure is to extend the contractN
The key to answerng ths queston s to understand that ths s a severe stuaton wth many probems-so many probems that t s cear the contract s not
servng ether party. When a contract no onger serves the needs t was ntended to serve, t can be renegotated f the approprate partes agree to ths.
When the seer has more expertse than the buyer, the procurement statement of work shoud descrbe performance or functon rather than a compete st of
work. In any case, the procurement statement of work shoud be as detaed as possbe.
When you must begn work mmedatey wthout a procurement statement of work, the most approprate choce s time and material.
The buyer has the rght to termnate the contract for cause or f the seer breaches the contract by not performng accordngy. Therefore, the procurement
woud enter the Cose Procurements process. Any dsputed payments or terms woud be handed accordng to the dspute resouton procedures n the contract.
!he independent estimate s most concerned wth cost, comparng cost estmates wth n-house estmates, or wth outsde assstance.
The most mportant ssue s the eve of deta n the procurement statement of work. If you have a desgn contract statement of work, a xed bd contract s
possbe. Wthout ths eve of deta, the rsk s hgh for the seer and thus the prce s hgher.
Recognze that the procurement manager has power regardng the contract, whe the pro|ect manager needs to ook out for the specc needs of the pro|ect.
Ths w cause conct when the pro|ect's needs change and the procurement manager doesn't want to make changes.
hs queston s askng for the output of the procurement process as a whoe, not an output of the peces wthn the process. The procurement process shoud
ead toward formal acceptance "not the 4ontract$ of the product of the pro|ect, makng choce C the best choce. Be carefu to propery read questons on
the exam!
5 procurement audit ncudes what went rght and wrong for the purposes of creatng hstorca records and mprovng future performance.
Here we are tyng together the concepts of standard devaton and contracts. Usng the concept of standard devaton, we nd that the cost of ths pro|ect w
vary, at one standard devaton, from $1.8M to $2.2M. Snce ths s not nsgncant, there woud appear to be some ambguty wth the pro|ect denton. As we
are not totay sure of the scope, we woud not pck a xed prce opton (choce A or C). Of the two CR optons, you need to seect the better of the two. Cost pus
percentage of costs (choce D) s probaby the worst type of contract to use, as there s no ncentve for the seer to contro costs. Ths eaves ony choce B, a
cost pus xed fee contract.
The tme and matera contract s the easest to negotate and aows for rapd turnaround. If you ddn't have the tme constrant, you woud seect a xed prce
contract
Generay n procurement stuatons, a change contro board mght revew and approve or re|ect a change, but ony the procurement manager has the authorty
to sgn a change.
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66 Incentves are meant to brng the ob|ectves of the seer n ne wth those of the buyer. That way both are progressng toward the same ob|ectve.
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68 The form of the deverabes for a specc porton of the pro|ect shoud have been revewed and cared durng the Pan Procurements process.
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lJ P.O-E1O356 53/ O4156 .EPO31B161!E
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2 Dversty can enhance a pro|ect f panned and coordnated throughout the pro|ect.
3 Whenever you are uncertan of whether a payment s a brbe, you shoud dscuss the stuaton wth ega counse.
4 You shoud oher your assstance to another Pro|ect Manager wthout dong the work.
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12 PMI does not condone decet or competton wthout consderng the needs of the organzaton.
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14 In a |apanese cutura context, Pro|ect Managers woud do best to focus on persona contact and reatonshp budng before gettng down to busness.
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Ouaty s dened as conformance to requrements. If nspecton work s not performed as requred n the contract, the pro|ect's quaty standards are not beng
met.
One factor n determnng the contract type to use s the eve of deta n the scope. In ths case, we have tte deta. A xed prce contract (choce C) s not the
best due to the hgh rsk to the seer and probabe hgh cost bd. Therefore, a cost pus xed fee gves the buyer the freedom to determne what they want whe
the contract s n process wth no contract changes. The rsk rests wth the buyer.
Due to the ack of detaed scope, you shoud not seect a xed prce contract (choce A). Because the buyer wants to be n fu contro, the tme and matera
contract (choce B) s the best opton.
In a procurement stuaton, generay ony the procurement manager has the authorty to sgn changes. Sometmes the pro|ect manager has certan expanded
authorty to sgn n the event of an emergency. However, an ncrease n cost s generay not consdered an emergency.
Once sgned, a contract s bndng. Generay, the nabty to perform, get nancng, or one party's beef that the contract s nu and vod does not change the
fact that the contract s bndng. If, however, both sdes agree to termnate the contract, the contract can move nto the Cose Procurement process. Once
cosure s competed, the pro|ect s consdered competed.
In a Fxed Prce Contract, the fee or prot s : Unknown (To the seer, t s known, but ths queston s from the buyer's perspectve. You do not know what prot
the seer ncuded n the contract).
You aways need to foow the change contro process. You cannot arbtrary decde to refuse to pay cams. Reserves shoud be used for dented rsks and not
used arbtrary.
The rst thng that shoud come to mnd s whether ths s an ethca stuaton and whether t voates any company rues or aws. If t does not voate any of
these, t woud be best to check quacatons.
Professona and soca responsbty requres the nvestgaton of any nstance where the egtmate nterests of the customer may be compromsed. If such a
compromse s found, acton must be taken.
When the pro|ect s competed eary, the pro|ect manager shoud report that the pro|ect came n ahead of tme and expan WHY. Ths s a success! If there was
proper pro|ect pannng, ths shoud occur because an expected rsk dd not materaze.
The pro|ect manager s nether empowered nor competent to determne the egaty of company procedures. NOTE: There s an mportant dstncton between
practces and procedures. A unethca practces shoud be reported. For exampe, a pro|ect manager must report an act of fraud. Fraud s not a company
procedure (normay). However, a pro|ect manager s not n a poston to determne whether company procedures compy wth exstng aw.
The pro|ect manager's responsbty s to provde truthfu pro|ect nformaton. He or she shoud thereafter dscuss the mpacts of ther actons wth the team
members. If that does not work, the next step s to report t to ther functona managers.
4ultures are thought of as: Integrated whoes.
ELective ver0al communication? The Pro|ect Manager shoud aways be as EXPLICIT, DIRECT, and UNAMBIGUOUS as possbe gven the cutura condtons.
Performance /omains include? Pannng, Executng, Controng, and Professona Responsbty.
The Code of Ethcs and Professona Conduct advocates transparency n decson makng, but t s not necessary for the Pro|ect Manager to take responsbty for
a decsons.
As the Pro|ect Manager, you have an obgaton to report any unethca behavor. Eou may need to strategi7e #ith your sponsor 0efore confronting
anyone.
1MPO.!53! PO13! C *
Point to remem0er
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2 Parametrc estmatng uses a statstca reatonshp between hstorca data and other varabes.
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A pro|ect fe cyce s a coecton of generay sequenta and sometmes overappng pro|ect phases whose name and number are determned by the
management and contro needs of the organzaton or organzatons nvoved n the pro|ect, the nature of the pro|ect tsef, and ts area of appcaton.
Trggers. Indcatons that a rsk has occurred or s about to occur. Trggers may be dscovered n the rsk dentcaton process and watched n the rsk
montorng and contro process. Trggers are sometmes caed rsk symptoms or warnng sgns.
Inuence dagrams. These are graphca representatons of stuatons showng causa nuences, tme orderng of events, and other reatonshps among
varabes and outcomes.
When cosng the pro|ect, the pro|ect manager w revew a pror nformaton from the prevous phase cosures to ensure that a pro|ect work s compete
and that the pro|ect has met ts ob|ectves.
Sgncant dherences n cost estmates can be an ndcaton that the procurement statement of work was decent, ambguous, and/or that the prospectve
seers ether msunderstood or faed to respond fuy to the procurement statement of work.
Snce a other factors are kept at basene vaues and ony one eement (.e. currency rate) s changed, we are usng Senstvty Anayss. Ths can be shown
usng a Tornado dagram.
Portfoo refers to a coecton of pro|ects or programs and other work (.e. operatons) that are grouped together to factate ehectve management of that
work to meet strategc busness ob|ectves.
!eaming agreement?... The ehort of the buyer and the seer n ths process s to coectvey prepare a procurement statement of #ork that w satsfy
the requrements of the pro|ect. The partes w then negotate a na contract for award.
To evauate the team`s ehectveness, we may ncude ndcators such as:
- 1mprovements in skills that aow ndvduas to perform assgnments more ehectvey - Improvements n competences that hep the team to perform
better as a team
- .educed staL turnover rate
- 1ncreased team cohesiveness whereby team members share nformaton and experences and hep each other to mprove the overa pro|ect
performance
To evauate the team`s ehectveness, we do not consder the pro|ect devery parameters ke scope, tme or cost.
Milestone s a sgncant pont or event n the pro|ect. Snce mestones ony ndcate when a partcuar task s gong to be started or competed, they w
not have any duraton, .e., the duraton for mestone s 7ero.
Durng the pro|ect fe cyce, the pro|ect team and key stakehoders dentfy essons earned concernng a aspects of the pro|ect. The essons earned are
comped, documented, and dstrbuted so that they become part of the hstorca database. However, most of the organzatons prefer post-mpementaton
meetngs and case studes to document essons earned.
In some cultures where oLering gifts is a custom, re|ectng or returnng the gfts may be consdered rude and napproprate behavor. Apprecaton of
cutura dherences s the way to wn the trust of peope from dvergent cutures.
Pay0ack Period? 1. Number of years requred for an organzaton to recapture an nta nvestment. 2. Dscount rate s not taken nto account n
cacuatons of Payback Perod, and 3. Pro|ect Seecton Crteron: Seect pro|ect wth ow Payback Perod.
In the pro|ect management context, integration includes characterstcs of uncaton, consodaton, artcuaton, and ntegratve actons that are cruca
to pro|ect competon, successfuy managng stakehoder expectatons, and meetng requrements.
!he areas to 0e considered in the process improvement plan ncude process boundares, process conguraton, process metrcs, and targets for
mproved performance.
In Estmate Actvty Duratons process, whch of the foowng s not an assumpton?
A: Exampes of assumptons ncude, but are not mted to, exstng condtons, avaabty of nformaton, and ength of the reportng perods.
The duraton of the pro|ect shoud be cacuated after drawng a network dagram and determnng the crtca path. !he duration of the pro2ect is the
length of the critical path and not the sum of the duration of all the tasks in the pro2ectN
Snce the change request pertans to a government reguaton and the pro|ect s beng managed as part of a contract, t s mandatory to mpement the
change. The rst step towards that s to actvate the change contro mechansm.
"@uality$ 5=nity diagrams are used to vsuay dentfy ogca groupngs based on natura reatonshps.
"@uality$ -orce -ield 5nalysis? Whch are dagrams of the FORCE FOR and AGAINST CHANGE.
5 #ork authori7ation system s a coecton of forma documented procedures that speces how pro|ect work s authorzed to ensure that work s done by
the dented organzaton at the rght tme and n the proper sequence. Dependng on the sze of the pro|ect, the desgn of a work authorzaton system
woud vary. For exampe, on many smaller pro2ects, ver0al authori7ations #ill 0e adeHuateN
Organi7ational theory provdes nformaton regardng the way n whch peope, teams, and organzatona unts behave. Ehectve use of ths nformaton
can shorten the amount of tme, cost, and ehort needed to create the human resource pannng outputs and mprove the kehood that the pannng w be
ehectve.
1dentify stakeholders s the process of dentfyng a peope or organzatons mpacted by the pro|ect, and documentng reevant nformaton regardng
ther nterests, nvovement, and mpact on pro|ect success... It s crtca for the pro|ect success to dentfy the stakehoders eary n the pro|ect, and to
anayze ther eves of nterest, expectatons, mportance and nuence. Identfy Stakehoders s done as part of 1nitiating Process Group.
The ma|or dherence between snge source contracts and soe source contracts- though 0oth are nonCcompetitive forms of procurements- s that n
snge source contracts, contract s awarded to a seer because he s the organzatons preferred seer, where as n soe source contracts, contract s
awarded to a seer because there are no other seers for the organzatons requred procurement tem. ole source contracts help organi7ations save
timeN
There are mutpe casscaton modes(for stakehoders) avaabe ncudng, but not mted to:
Po#er/interest grid, groupng the stakehoders based on ther eve of authorty (power) and ther eve or concern (nterest) regardng the pro|ect
outcomes;
Po#er/in>uence grid, groupng the stakehoders based on ther eve of authorty (power) and ther actve nvovement (nuence) n the pro|ect;
1n>uence/impact grid, groupng the stakehoders based on ther actve nvovement (nuence) n the pro|ect and ther abty to ehect changes to the
pro|ect`s pannng or executon (mpact ); and
alience model, descrbng casses of stakehoders based on ther power (abty to mpose ther w), urgency (need for mmedate attenton), and
egtmacy (ther nvovement s approprate).
5 pro2ect life cycle s a coecton of generay sequenta and sometmes overappng pro|ect phases whose name and number are determned by the
management and contro needs of the organzaton or organzatons nvoved n the pro|ect, the nature of the pro|ect tsef, and ts area of appcaton.
Pro|ect can be broken nto severa phases, whch can be done by usng a fe cyce approach.
Schedue varance anayss aong wth revew of progress reports, resuts of performance measures and modcatons to the pro|ect schedue can resut n
change requests to the schedule 0aseline and/or to other components of pro2ect planN
29 The abty to nuence cost s greatest at the eary stages of the pro|ect, makng eary scope denton crtca.
30 Snce ths s a "mnor aw," but rectcaton of that aw woud take a ong tme, t s better to dscuss wth the sponsor and customer and get ther nputs.
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40 Weght s the ony varabe here. A the other optons refer to unts of currency (Door, Pound) and measurement (Meters).
41 Enterprse envronmenta factors may enhance or constran pro|ect management optons and may have a postve or negatve nuence on the outcome.
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43 Canceaton of the contract has to be done by both the seer and the buyer (.e., the buyer cannot unateray cance the contract).
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51 Peope exhbt greatest resstance to change.
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YPrevention costsK are costs ncurred by an organzaton to create hgh quaty products n order to avod faures. They ncude cost of tranng, cost of
documentng processes, cost of equpment, etc
M5.! <oals? The performance goas shoud be SMART - Specc, Measurabe, Achevabe/Attanabe, Reevant and Tme-specc.
Preventive action? A documented drecton to perform an actvty that can reduce the probabty of negatve consequences assocated wth pro|ect rsks.
!rend analysis s performed usng run charts and nvoves mathematca technques to forecast future outcomes based on hstorca resuts. Trend anayss
s often used to montor technca performance, .e., how many errors or defects have been dented, and how many reman uncorrected and cost and
schedue performance, .e., how many actvtes per perod were competed wth sgncant varances.
Bariance analysis s used to determne the cause and degree of varance reatve to the schedue basene and decde whether correctve or preventve
acton s requred.
Sequence Actvtes s the process of dentfyng and documentng the reatonshps among the pro|ect actvtes. Schedue network tempates are the toos
used n ths process. (Schedung too) s used for Deveop Schedue; (Decomposton) s used for Dene Actvtes; (Schedue compresson) s used for
Deveop Schedue
Precision and accuracy are not equvaent. Precson means the vaues of repeated measurements are custered and have tte scatter. Accuracy means
that the measured vaue s very cose to the true vaue. Precse measurements are not necessary accurate. A very accurate measurement s not necessary
precse.
1nspections are sometmes caed revie#s, product revie#s, audits, or #alkthroughs. tage gates are aso referred to as phaseCend revie#s or
kill points. They are dherent from Inspecton.
Some of the conAguration management activities ncuded n the ntegrated change contro process are... conguraton dentcaton, conguraton
status accountng, and conguraton vercaton and audt.
Requests for change can be drect or ndrect, externay or nternay ntated, and can be optona or egay/contractuay mandated. Request for change s
aways a forma process.
Dentve: - 5% to +10% accuracy
Budgetary: -15% to +25% accuracy
Order of magntude: - 50% to +50% accuracy
Pro2ect Management ystem? The aggregaton of the processes, toos, technques, methodooges, resources, and procedures to manage a pro|ect.
Any tme the customer requests for a change, you shoud:
1. Understand what knd of change s requested and tak wth team members to assess the mpcaton of the change.
2. Open up a change contro f there s a forma change contro mechansm.
3. Communcate the change to the management, and nform the customer about the mpact of the change (e.g. ncrease n szng, schedue, etc.).
4. Impement the change f t s accepted.
The most preferred conct resouton technques adopted by pro|ect managers (n descendng order of preference) are as foows:
1. Confrontaton
2. Compromse
3. Smoothng
4. Forcng
5. Wthdrawa
Terms such as 0id, tender, or Huotation are generay used when the seer seecton decson w be 0ased on price (as when buyng commerca or
standard tems), whe a term such as proposal s generay used when other consderatons such as technical capa0ility or technical approach are
paramountN
5 milestone list dentes a mestones and ndcates whether the mestone s mandatory, such as those speced by contract, or optona, such as those
based upon hstorca nformaton.
Due to varyng organzatona structures, many organzatons treat contract administration as an administrative function separate from the pro2ect
organi7ation.
1MPO.!53! PO13! C F
Point to remem0er
1 Programs may often ncude 'Operatons'.
2 Sponsor - Pro|ect Champon.
3 SMEs - Sub|ect Matter Experts.
4 Change Contro System s a part of OPA (Organzatona Process Assets).
5 Outputs of a 42 Processes w be stored n PMIS.
6 M & C Pro|ect Work: Actvtes - Measurng, Coectng, Inspectng, Ouestonng, and Assessng.
7 M & C Processes' nputs are ether PLAN or ACTUAL.
8 A 10 M & C Processes have Change Requests as an output.
9 Perform Integrated Change Contro acts as 'Cearnghouse'.
10 Pro|ect Management Software s a 'Means' not the 'End'.
11 Hgh Standard Devaton s Hgh Rsk.
12 CPM - FLOAT usage; CCM - Buher usage.
13 PMI's 100% Rue - Compete SCOPE shoud be avaabe n WBS.
14 WBS: Graphca/Herachca/Numerca
15 Contro Accounts - Performance Check Ponts/Management Check Ponts.
16 Requrements Categores: 1. Product Requrements (Technca Speccatons); 2. Pro|ect Requrements (Operatona Speccatons)
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19 Observaton and Conversaton. Ths s aso known as MBWA or Management By Wakng Around.
20 The conct s of a technca nature, so the best way the pro|ect manager coud sove the probem s by usng hs or her technca expertse.
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22 In Matrx Organzaton, the pro|ect manager s responsbe for Manage Pro|ect Team.
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25 Cause & Ehect/Ishkawa/Fshbone Dagram or 5 WHY Technque.
26 Ouaty Benets must outwegh the Cost.
27 LOW Standard Devaton means LOW Fuctuaton; HIGH Standard Devaton means HIGH varaton.
28 Average Response Tme shoud be ess than TWO Hours.
29 Perform Ouaty Contro: - Inspectng; - Measurng; - Testng; - Chartng; - Anayzng.
30 Attrbute Sampng s 'Bnary' (Yes/No); Varabe Sampng s Degree of Conformty.
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33 The BIG Four: 1. Ishkawa; 2. Demng; 3. |uran; and 4. Crosby.
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35 Leads and ags are APPLIED as part of the Deveop Schedue process, but then they are AD|USTED n the process of Contro Schedue.
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45 Zero Schedue Varence (SV) means the taks s competed.
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51 The Budget at Competon (BAC) and Panned Vaue (PV) can both be cacuated before work begns.
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Contro Charts aso caed 'hre#hart 4harts'.
Pro2ect Murder Board, whch s dened as a pane of peope who try to shoot down a new pro|ect dea. The other answers are aso pro|ect seecton methods, but
they dont expan why there s a pane of peope that asks a of these questons.
-orcing does do away wth the conct - but ony temporary. It s when the manager says that t s hs pro|ect and you w do thngs hs way. Perod, end of
dscusson. The root of the probem s not addressed by ths approach, thus the souton s ony temporary.
!he standard deviation measures how dverse the popuaton s. It does ths by averagng a of the data ponts to nd the mean, then cacuatng the average of
how far each ndvdua pont s from that mean. For a very dverse popuaton, you w have a hgh standard devaton. For a hghy smar popuaton, your
standard devaton w be ow.
|ob shadowng s aso known as Observaton, @uality -unction /eployment s a factated workshop, and combned wth surveys, these are a toos of the
Coect Requrements process.
1nspection? Keepng errors out of the hands of the customer; Prevention? Keepng errors out of the process.
Work Performance Measurements revea actua resuts: * Condton of Deverabes; * Status of Schedue; * Status of Budget; * Performance Reports; * Technca
Speccatons. And t s a subset of WPI.
The denton of the #ork authori7ation system s the system used to ensure that resources are formay beng reeased to perform work at the rght tme and
n the rght sequence. In ths case, a meetng wth the resources functona manager woud quafy as beng a system.
In Verfy Scope, the PM, sponsor, and customer nspect the product and verfy that t meets the dened scope. ALL stakehoders are not nvoved n ths process.
Why not? There are too many stakehoders to seek acceptance from a; some stakehoders may be opposed to the pro|ect and never accept t! Don't confuse
stakehoders wth key stakehoders.
!he stakeholder register s used as an nput n the foowng ve processes: Coect Requrements (Scope), Pan Communcatons (Communcatons), Pan Ouaty
(Ouaty), and Identfy Rsks (Rsk). 'B' s the correct answer. Ths s an IMPORTANT nput!
A successfu pro|ect manager w earn the art of deegaton - what to deegate to others and what to not deegate. So, et's ook at ths st. 'A' - routne actvtes
can be deegated - sure. The team w have reguar responsbtes (routne tasks) that they are accountabe for. 'B' - technca specs shoud be deveoped by the
persons that have the expertse. That s probaby not the PM. 'C' - pckng the team-budng actvty for the next meetng - no probem. These rst 3 can be
deegated to the team. 'D,' however, shoud not be. The pro|ect manager s responsbe for evauatons of team members. The PM shoud be provdng feedback to
the functona manager on the performance of stah. So, 'D' shoud not be deegated.
You want to smuate the rsk event (the server crashes and must be rebut) and determne the mpact t has on the pro|ect. Thnk of ths too of Perform
Ouanttatve Rsk Anayss as you woud a mtary dr or emergency dr. The team s thrown nto a smuated, precarous stuaton and earns how to best
respond. 'A' and 'C' are both toos of Perform Ouanttatve Rsk Anayss but are not the correct choces here.
ensitivity analysis s the too used when you want to evaluate ho# one change #ill aLect the overall pro2ect. It works by keepng the other varabes
stabe (that s, hed at a basene) and anayzng the mpact of a change. Lke senstvty anayss, 'A' and 'B' are both toos of Perform Ouanttatve Rsk Anayss;
however, they are not a good match for the scenaro provded. 'C' s a made-up term.
Ths s a very reastc stuaton for most PMs. You shoud remember that face-to-face communcaton s aways best and that team deveopment shoud start eary
n the pro|ect - as soon as you have team members. Ths makes 'A' the best answer. 'C' ncudes ncorrect nformaton. Vrtua teams are a too of Acqure Pro|ect
Team, not of Deveop Pro|ect Team. 'B' s not the rght answer because the pocy doesn't state that no trave s aowed. Traveng to meet team members, as we
as other stakehoders, s a reastc expense and not an extravagance.
The Cose Pro|ect or Phase process shoud be performed at the end of each phase or at the end of the pro|ect. 1t should also 0e o0served early in the pro2ect
to understand closure criteria from the very 0eginning of pro2ect planningN It s the process where the pro|ect s formay accepted and the pro|ect records
are created. It s mportant to understand that Cose Pro|ect or Phase may happen severa tmes throughout the pro|ect.
Team Budng s Very Dmcut n MATRIX, Very Easy n FUNCTIONAL, and next Esest n PRO|ECTIZED.
Rsk SCORE w hep gude Rsk RESPONES.
!he more channels of communication on a pro|ect, the more di=cult it is to control communicationsN
The To-Compete-Performance-Index "!4P1$ s: The cost performance ndex "4P1$ requred n the remander of a pro|ect to meet nanca goas.
PM1 prefers colla0oration when t comes to resovng ssues or concts. Some of the other answers are very temptng, but for the exam, focus on
colla0oration or either pro0lemCsolving confrontation as the 0est methodsZ
It s the roe of senior management to resove organzatona concts and to prortze pro|ects.
Throughout the fe of a pro|ect, a pro|ect manager shoud generay move through four phases of eadershp: /irecting, coaching, facilitating, and
supportingN
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55 Prortzng the changes s the |ob of the pro|ect manager.
56 The S curve s the cost performance basene. The cost performance basene s used to track cost performance based on the orgna pan pus approved changes.
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58 The contract change contro system s dened n the contract, whch s created as an output of the Conduct Procurements process, whch s an executng process.
59 The ssue og s a too used n Manage Pro|ect Team n the Human Resource Management knowedge area.
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66 Both the buyer and the seer perform Admnster Procurements to ensure that a of the ega terms of the contract are beng met by both partes.
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72 TCPI: The competon of the remanng work at an actua cost not to exceed the remanng funds.
73 Cams aganst the contracted partes shoud be ed as a resut of a dspute, and resovng such cams s done n the process of Admnster Procurements.
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76 Soft sks such as nterpersona and management sks are mportant n reatng to ndvduas, budng trust, and deverng a cear message.
77 Meetngs are cassed as nforma verba - even when the sub|ect matter s mportant!
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4onAguration management is? A procedure to dentfy and document the functona and physca characterstcs of an tem or system.
As part of integrated change control, the pro|ect manager w need to know #hen change has occurred, manage the changes, and in>uence the
factors that cause change, but the pro|ect manager shoud not take on the atttude of denyng change whenever possbe. Some change s nevtabe, and a
change requests shoud be evauated and not automatcay re|ected.
The PMBOK Gude emphaszes the use of the conAguration management system as t reates to managing and controlling change reHuests, speciAcally
in the process of Perform 1ntegrated 4hange 4ontrol.
An actvty's ate nsh date s the atest an actvty can nsh wthout deayng the pro|ect. If t exceeds the ate nsh date, the crtca path w change, utmatey
resutng n the nsh date sppng. Choce 'A' s cose to the denton of free oat.
There s a dherence between present vaue and net present vaue. Present vaue tes the expected future benets of the pro|ect n today's doars. Net present
vaue s very smar, but t aso ncudes (or nets out) the expected future costs n today's doars.
Procurement performance revews are a too of Admnster Procurements where the buyer arranges a meetng wth the seer to revew the seer's performance
aganst the pan. Ths queston presents a near-textbook case of ths.
If two events have no bearng on each other, they are statistically independent.
Mutually Exclusive s when two events cannot both happen at the same tme.
A document management system s a conguraton management too, usefu n the pro|ect management nformaton system. Conguraton nformaton n
partcuar w assst wth the too of Varance Anayss n the process of Contro Scope.
Resovng contract dsputes s performed n Admnster Procurements. However, when cosng the contract, as n ths case, the too of Negotated Settements s
used to sette any open cams, even f Aternate Dspute Resouton forms are nvoked.
The To Compete Performance Index s dened as the spendng emcency that s needed for the remander of a pro|ect n order to meet a nanca target or goa. If
the goa s to compete the pro|ect on budget and the CPI s 90%, then the TCPI w need to be greater than 100% to compensate for the prevous overruns.
However, f the goa s amended to be the forecasted competon (EAC - whch s derved from the CPI), then the current CPI w acheve the goa. Therefore, the
TCPI equas the CPI for a target of EAC.
Unt the scope has been dened and documented n the approved Scope Statement, WBS, and WBS Dctonary, whch make up the scope basene, t s not stabe
enough to be put under contro.
The too beng descrbed s aternatves dentcaton, used n the process of Dene Scope. SMEs can hep the pro|ect team branstorm about the varous creatve
ways that the pro|ect requrements mght be accompshed.
There s a dherence between the product scope and the pro|ect scope. The scope of the pro|ect may be much arger than the scope of the product!
The features and attrbutes that characterze a pro|ect deverabe or resut descrbe whch of the foowng? !he product scopeN
Whch of the foowng s the best descrpton of a conguraton management system?
It provdes a standard, emcent method to manage approved changes to basenes n a pro|ect.
The denton of the #ork authori7ation system s the system used to ensure that resources are formay beng reeased to perform work at the rght tme and n
the rght sequence. In ths case, a meetng wth the resources functona manager woud quafy as beng a system.
The key phrase n ths queston s the sponsor's statement about achevng the budget goa. Ths shoud ead you to thnk of the To-Compete-Performance-Index.
Ths ndex s the spendng emcency that you must mantan to acheve the stated goa, n ths case, nshng the pro|ect on budget. TCPI=Remanng Work dvded
by Remanng Funds. Remanng Work s BAC-EV whe Remanng Funds (wth BAC as the goa) s BAC-AC. You are gven AC and CV. EV=CV+AC so EV=$815K. Snce
you are 50% compete wth the pro|ect, then BAC s twce the EV, or $1630K. Dvdng remanng work ($815K) by Remanng Funds ($910K) gves you 89.6% whch
shows that Answer B at 90% s the best answer.
In the Communcatons process of Identfy Stakehoders, the PM eads the team to dentfy the pro|ect's stakehoders and the needs of the stakehoders.
Stakehoder anayss s a too of the Identfy Stakehoders process.
Estmate Actvty Resources outputs (prmary the actvty resource estmates and the resource breakdown structure) are deay created by the person dong the
work. You woud not necessary need someone externa to the pro|ect to revew them.
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1nputs !ools G !echniHues Outputs
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1. Pro|ect Statement of Work (SOW) 1. Expert |udgment 1. Pro|ect Charter (PC)
3. Contract
4. Enterprse Envronmenta Factors c P2 names the PM and gives PM authority to manage will be developed later
5. Organzatona Process Assets
4OMMU3145!1O3
)P
1. Pro|ect Charter 1. Stakehoder Anayss 1. Stakehoder Regster
2. Procurement Documents (Partcpaton Anayss) 2. Stakehoder Management Strategy
3. Enterprse Envronmenta Factors 2. Expert |udgment (Stakehoder Anayss Matrx)
4. Organzatona Process Assets
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' 4lose Pro2ect or Phase?
1. Pro|ect Management Pan 1. Expert |udgment 1. Fna Product, Servce, or Resut Transton
2. Accepted Deverabes 2. Organzatona Process Assets Updates
3. Organzatona Process Assets
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<1. Pro|ect Management Pan 1. Cosed Procurements
2. Procurement Documentaton 2. Negotated Settements 2. Organzatona Process Assets Updates
3. Records Management System
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/evelop Pro2ect 4harter?
2. Busness Case %is the document that justi"es why the
project should be accomplished&
a Project 2harter is created based on some need, and it
should e)plain that need
e P2 should include a high1level milestone view of the project
schedule
b P2 is signed by the performing organization:s /enior
Management
f P2 is a high1level document that does not include project
details< the speci"cs of project activities
d P2 should include the high1level proj requirements, high1
level Project 3escription, high1level +isks
g P2 includes a summary1level prelim project budget
h /how organizational, environmental and e)ternal
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1dentify takeholders?
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4lose Procurements? The process of competng each pro|ect procurement.
* Fnaze and Cose each purchasng contract. * When the contract s Competed or Termnated for any reason, ths process s performed.
1. Procurement Audts (Revew of Procurement Processes - for
capturng Lessons Learned)
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1nputs !ools G !echniHues Outputs
/irect and Manage Pro2ect Execution?
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1. Pro|ect Management Pan 1. Expert |udgment 1. Deverabes
2. Approved Change Requests 2. Pro|ect Management Informaton System - PMIS 2. Work Performance Informaton (WPI)
3. Enterprse Envronmenta Factors 3. Change Requests
4. Organzatona Process Assets 4. Pro|ect Management Pan Updates
5. Pro|ect Document Updates
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Perform @uality 5ssurance?
1. Pro|ect Management Pan (O M P & Process Imp P) 1. Ouaty Audts (Key Too) 1. Change Requests (for Procedura Changes)
2. Ouaty Metrcs (Denes how O w be measured) 2. Process Anayss 2. Pro|ect Management Pan Updates
3. Ouaty Contro Measurements 3. Pan Ouaty and Perform Ouaty Contro Toos 3. Pro|ect Document Updates
4. Work Performance Informaton and Technques 4. Organzatona Process Assets Updates
DUM53 .EOU.4E
5cHuire Pro2ect !eam?
1. Pro|ect Management Pan 1. Pre-Assgnment 1. Pro|ect Stah Assgnments
2. Enterprse Envronmenta Factors 2. Negotaton (Key Technque of ths process) 2. Resource Caendars
3. Organzatona Process Assets 3. Acquston 3. Pro|ect Management Pan Updates
4. Vrtua Teams
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1. Pro|ect Stah Assgnments (w have st 1. Tranng 1. Team Performance Assessments
of a team members) 2. Team-budng Actvtes 2. Enterprse Envronmenta Factors Upd
2. Resource Caendars 3. Ground Rues
3. Pro|ect Management Pan 4. Co-ocaton
5. Recognton and Rewards
6. Interpersona Sks (Soft Sks)
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1. Pro|ect Management Pan 1. Observaton and Conversaton 1. Change Requests
2. Pro|ect Stah Assgnments 2. Pro|ect Performance Apprasas 2. Pro|ect Management Pan Updates
3. Team Performance Assessments 3. Conct Management 3. Organzatona Process Assets Updates
4. Performance Reports 4. Issue Log 4. Enterprse Envronmenta Factors Updates
5. Organzatona Process Assets 5. Interpersona Sks
4OMMU3145!1O3
/istri0ute 1nformation?
1. Pro|ect Management Pan 1. Communcaton Methods 1. Organzatona Process Assets Updates
2. Performance Reports 2. Informaton Dstrbuton Toos
3. Organzatona Process Assets
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1. Stakehoder Regster 1. Communcatons Methods 1. Change Requests
2. Stakehoder Management Strategy (Face-to-face s the best) 2. Pro|ect Management Pan Updates
3. Pro|ect Management Pan 2. Interpersona Sks 3. Pro|ect Document Updates
3. Management Sks 4. Organzatona Process Assets Upd
5. Change Log
6. Organzatona Process Assets
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4onduct Procurements?
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1. Pro|ect Management Pan (Pr M P) 1. Advertsng 1. Seected Seers
2. Pro|ect Documents 2. Internet Search 2. Procurement Contract Award
4. Procurement Documents 3. Bdder Conference 3. Resource Caendars
3. Teamng Agreements 4. Proposa Evauaton Technques 4. Change Requests
5. Make-or-Buy Decsons 5. Independent Estmates ('Shoud-Cost' Estmate) 5. Pro|ect Management Pan Updates
6. Source Seecton Crtera 6. Procurement Negotatons 6. Pro|ect Document Updates
7. Ouaed Seers' Lst 7. Expert |udgement
8. Seer Proposa
9. Organzatona Process Assets
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/evelop Pro2ect !eam?
Manage Pro2ect !eam?
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Manage takeholder Expectations?
4. Issue Log (Acton Item Log) (Each Issues shoud be assgned
to one Owner)
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1nputs !ools G !echniHues Outputs
F Monitor and 4ontrol Pro2ect :ork?
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1. Pro|ect Management Pan 1. Expert |udgment 1. Change Requests
2. Performance Reports 2. Pro|ect Management Pan Updates
3. Enterprse Envronmenta Factors 3. Pro|ect Document Updates
4. Organzatona Process Assets
I Perform 1ntegrated 4hange 4ontrol?
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1. Pro|ect Management Pan 1. Expert |udgment 1. Change Request Status Updates
2. Work Performance Informaton 2. Change Contro Meetngs 2. Pro|ect Management Pan Updates
3. Change Requests 3. Pro|ect Document Updates
4. Enterprse Envronmenta Factors
5. Organzatona Process Assets
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1. Pro|ect Management Pan 1. Inspecton 1. Accepted deverabes
2. Requrements Documentaton 2. Change Requests
3. Requrements Traceabty Matrx 3. Pro|ect Document Updates
4. Vadated Deverabes
%% 4ontrol cope?
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1. Pro|ect Management Pan 1. Varance anayss 1. Work Performance Measurements
2. Work Performance Informaton 2. Change Requests
3. Requrements Documentaton 3. Pro|ect Management Pan Updates
4. Requrements Traceabty Matrx 4. Pro|ect Document Updates
5. Organzatona Process Assets 5. Organzatona Process Assets Updates
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%+ 4ontrol chedule?
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1. Pro|ect Management Pan 1. Performance Revews 1. Work Performance Measurements (SV & SPI vaues)
2. Pro|ect Schedue 2. Varance Anayss (SV/SPI) 2. Change Requests
3. Work Performance Informaton 3. Resource Leveng 3. Pro|ect Management Pan Updates
4. Organzatona Process Assets 4. What-f Scenaro Anayss 4. Pro|ect Document Updates
5. Ad|ustng Leads and Lags 5. Organzatona Process Assets Updates
6. Schedue Compresson
7. Schedung Too
8. Pro|ect Management Software
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1. Pro|ect Management Pan 1. Earned Vaue Management (Varances and Trends) 1. Work Performance Measurements
2. Pro|ect Fundng Requrements 2. Forecastng (EAC and ETC) 2. Budget Forecasts
3. Work Performance Informaton 3. To-compete Performance Index (TCPI) 3. Change Requests
4. Organzatona Process Assets 4. Performance Revews 4. Pro|ect Management Pan Updates
5. Varance Anayss 5. Organzatona Process Assets Upd
6. Pro|ect Management Software 6. Pro|ect Document Updates
@U561!E
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1. Pro|ect Management Pan (O M Pan) 1. Cause and Ehect Dagram (Ishkawa/Fshbone) 1. Ouaty Contro Measurements
2. Ouaty Metrcs 2. Contro Charts 2. Vadated Changes
3. Ouaty Checksts 3. Fowchartng 3. Vadate Deverabes
4. Deverabes 4. Hstogram 4. Change Requests
5. Approved Change Requests 5. Pareto Chart 5. Pro|ect Management Pan Updates
6. Work Performance Measurements 6. Run Chart 6. Pro|ect Document Updates
7. Organzatona Process Assets 7. Scatter Dagram 7. Organzatona Process Assets Updates
8. Statstca Sampng
9. Inspecton
10. Approved Change Requests Revew
DUM53 .EOU.4E
4OMMU3145!1O3
*) .eport Performance?
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2. Change Requests
4. Budget Forecasts 4. Reportng Systems (Standard Too for PM to Capture, 3. Organzatona Process Assets Updates
5. Organzatona Process Assets Store and Dstrbute Informaton)
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1. Rsk Regster 1. Rsk Audts 1. Rsk Regster Updates
2. Pro|ect Management Pan 2. Reserve Anayss 2. Change Requests
3. Performance Reports 3. Rsk Reassessment 3. Pro|ect Management Pan Updates
4. Work Performance Informaton 4. Status Meetngs 4. Pro|ect Document Updates
3o ONPN5 G ENEN-
5. Technca Performance Measurement 5. Organzatona Process Assets Updates
6. Varance and Trend Anayss
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F% 5dminister Procurements?
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1. Pro|ect Management Pan 1. Inspectons and Audts 1. Procurement Documentaton
2. Procurement Documents 2. Procurement Performance Revews 2. Change Requests
3. Contract 3. Performance Reportng 3. Pro|ect Management Pan Updates
4. Approved Change Requests 4. Contract Change Contro System 4. Organzatona Process Assets Updates
5. Performance Reports 5. Payment System
6. Work Performance Informaton 6. Cams Admnstraton
7. Records Management System
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Berify cope?
(It nvoves a pont-by-pont revew of the Scope and the
assocated Deverabe). Examne the deverabes, Measure t,
Inspect t, and Wegh t.
VA can be used to measure dherences btwn what was dened
n the Scope Basene & what was created. It s usefu n ths
process as a way to nvestgate and understand the root
causes behnd these dherences.
4ontrol 4osts?
Perform @uality 4ontrol?
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1. Pro|ect Management Pan
(Performance Measurement Basene - It ncudes Cost,
Schedue, Scope, Tech, and Other Basenes)
1. Varance Anayss
- Backward Lookng Too (It s an after-the-fact)
1. Performance reports
(It shows how the pro|ect s progressng aganst the
varous basenes (Scope, Tme, Cost and Ouaty).
2. Work Performance Informaton (Deverabes Status,
Schedue Progress, and Costs Incurred)
2. Forecastng Methods
- Forward Lookng Too (EAC, ETC)
Common Formats - Bar Charts, S-curves, Hstograms, and
Tabes. Varance, EV, Forecastng.
3. Work Performance Measurements
(CV, SV, CPI, CPIc, SPI)
3. Communcaton Methods (PM generay uses a PUSH Comm
Technque)
Monitor and 4ontrol .isks?