sare x 6 aves Introduction ‘This section describes the purpose of The Standart for Projet Management, identifies the audience, and provides a brief overview ofthe structure ofthe standard 1.1 Purpose of The Standard for Project Management The Standard for Project Management ~ Seventh Edition provides a common bass for and “understanding of project delivery. This standard applies to any projector delivery approach—such as predictive, agile, and ybrid—aeross industries, “The standard describes the Value Delivery System, of which projects area fundamental ‘component, The standard identifies principles that eude the practice of project ‘management practitioners, project team members, an oer stakcholers who work on or wo are engaged with projets. The principles support achievement ofthe intended outcomes that ultimately deliver value to organizations and stakcholders, ‘The projet delivery principles in his stunand vepresent a depastue Gow what has historically been « provost oriented approach a principles oriented approach that ‘supports any type of pnjct livery: The principles articulate inthis standard provide _Ruidance for prectitioner behaviors and actions for any projects and project-tlated activities. These principles support project teams to enable realization of the intended valu fiom projets tothe organization and stakeholders, In the context of The Standard for Project Management, projst management encompacies the application of knowledge sills, tons, and techniques to pmject activities to mest ‘project requirements, While this tactical focus ensures the project delivers is intended resuls this standard expands the term to address the eontinuing pace of change in global business. The expanded term projet delivery complements the term project management. It embraces the brdening continuum of ways in which project results can be achieved by bringing a sharper focus on project outcomes rather than just project deliverables. This standard speaks to both project management and project delivery 1.2 Audience for the Standard ‘This standard provides a foundational reference for anyone pateipating in a projct ‘environment. Ths clues, but snot limited to: + People who are accountable for delivering project oteomes; + People who work on projects full or part time; + People who workin project managcment offices (P™MOs); + People involved in projet sponsorship, produet ownership, product management, ‘executive leadership. or project governance: + People involved with ponlio o program management, + People who provide resouroes for project work; + Consultants who focus on value delivery for portfolios, programs, and projets; + Educators who teach projet management: + Suen of project assagenwa, and + Others involved in any aspect of the project delivery value chain, 1.3 Structure of the Document ‘The standard consists ofthe following scetions: + Section 1 tntsoduction. Proves an oveiview and puspose ofthis sana, + Section 2Value Delivery System. Prosents key definitions associated with value delivery and defines the Value Delivery System and the continuing evolution of project delivery. + Section Project Delivery Principles, Defines and elaborates the 12 principles associated with succesful project dlivey. 1.3.1 The Value Delivery System ‘The Value Delivery System isthe holistic system through which projets deliver business58 value. This section presents the concept of projects as a means of creating desited ‘outcomes, including key concept associated with the context in which projects exist and ‘the way in which projects enable outcomes to realize value, It includes a discussion of | value dolivery, typical roles and skis, and relationships with customers, end users, and 62 otter stakeholders ofa projet 288 © 1.3.2 Project Delivery Principles 64 ‘The concept of prjcet delivery sets forth a view of project teams that actively engage 65 with projects using a set uf wvepted principles that averse industry and culture. The 65 project delivery principles were derived from publicly held discussions and consents 7 within the profession to ensue that hey reflect cverse perspectives, experiences, and © approaches. Research across the profession helped identity underlving principles that were 09 not expliily state. 11 The projestdctivery principles enable an evoluion inthe profession from a 72 process-driven to an outeomes-focused approach that embraces innovation and lxibility ‘within a set of commonly held tenets of practice ~2 » Value Delivery System 7 2.1 Overview ‘3 Onsanizational leaders and teams undertake projects to realize value for organizations and a their stakeholders, Successful projects deliver that intended value. They crete unique 81 daliversbles—product, services, of rsulte—that enable organizational capabilities, The 82 capahiliies drive outcomes that deliver benefits. Value isthe net tangible or intangible 89. result of realized benefits less the cost of achieving those benefits. For some + organizations, value may represent financial gun, In ther organizations, valu may 5. ropresent sociotal improvements or public good, such as increased litracy of lower 20 fatality rates 88, Projects are part of an organization's initiatives (see Figure 2-1). Projects ean stand alone or be part oF a program or portfolio of work. Section 2.3 describes aspects oF 0 projects in greatr detail. Essential to project success and driving vale delivery are 81 effective organizational governance and approaches fo the human aspect of projets. Both are discussed inthis section ofthe standard Pinjects are ommissianed tn aan the mission, statagy and husiness objectives of an ‘orvanization, Indicators that the organization is advancing toward or realizing ts strategic and business objectives flow fiom niiatives and include the following: “The overarching objectives tha determine an organizations direction, res. The broakdown of strategy into desired outcomes 500 + Initlatives. The portfolios, programs, and projects create o deliver a sitegic 101 objective. 02 = Deliverables, Producs,serviees, of sesulls wenetated by portfolio, pro 103. project 104» Capability. The ability to ald value or achieve ajoctives through a function, 10> process, service, or other proficiency. 102+ Outcomes. The results obtained through the use of portfolio, program, and project ‘07 outpots. The results may be tangible or intangible, $08» Benefits. Cains realized by the organization and beneficiaries through portfolio, (09 program, or projet ouputs and resulting outcomes, 0 + Valu The not result of alized benefits lus the cost of, or effort for, achieving those benefits. The value may be tangible or intangiblew7 19 v0 1m 13 us 5 9 19 102 0s, Figure 2-1, Connecting Organization Strategy to Benefits Realization Management ‘he folowing practical example ilstates these connections: An organization’ leaders conser innovation to he ane of its strategic goals. One strategic objective may be to release an improved product for its customers. Therefore, ‘the leader initiate prodct improvement project based on customer feedback. The deliverable of thi project is an enhanced offering with added functionality. The desired ‘outcomes from the enhanced offering are mnereased user layaly. along witha gan of a specified pereentage of marketshare from competitor, The outcomes drive benefits in the form of revenue growth and inereased customer satisfaction. The busines valu i the profit level associated with the improved offering All project attempt to deliver a result, though some may fil to do so or may produce suboptimal outcomes. The potential for suboptimal outcomes exists in every project. nthe «ase ofa flly experimental project, te organization is attempting to achieve a ‘cakthrough, such asthe ercation fa completely new technology, for example. This ‘requires deliberate investment in an uncertain outcome. Some projects may be very similar to current organizational work but the knowledge. technology. of skill within the ‘organization wo produce the desired yume is mising something critical. For example, ‘componies that produce new modisines or compounds may experince several aires before Finding a successful formula Some penjacs may fil ta drive outcomes hecanse the market ‘opportunity has passed or competitors were Fist to market with ther offering, among. ‘other seasons. Effective project delivery can minimize negative outcomes, but such ‘posibiltioe sre part ofthe uncertainty of attempting to produce a nique recul, ‘The evolution of business and the intnplay of various environmental forces drive the practice af project management toward ¢value-based system, The vale-based system is Framework for optimizing outcomes by balancing elements such as cost, quality Sk, sake intevests, ad esousees, Speed vf technological lange, dhe need w adap (0 dynamic change, use of floxibilty in approaches to work, limited resources, and an inreased fags on estomerorend-aser satisfaction are jst some af the challenges wi ‘whieh projet professionals grape in thei daily work, In response to these dynamics, the Value Delivery System represents a collection of strategie buses wetivites aimed a building, sustaining, andr advancing an “organization, The Value Delivery System emphasizes abroad application of concepts, raetices, ad techniques for peeing value in-an increasingly complex business context ‘Atte project level, every project has a measurable value connection to some aspect of ‘organizational suateay, mission, or business need, as well ast desired outcomes. Examples include, but are not limited to: + Crating a new product, servies or result that satisfies the nceds of customers or end users: + Improving efficiency, productivity effectiveness, or responsiveness + Sustaining Dewofits enable by previous projects, pugsans, business operations, + Enabling the changes neoded to facilitate organizational tanstion to ts dasited faire state; and + Creating positive social or environmental contributions. In the context ofthis standard and its view of valve delivery, projects are part ot a Value Delivery Systeu, which ia collection of strategie business wctivites aed at ‘building, sustaining, andor advancing an organization, The Value Delivery System (see Figure 7) epesents a hidiectional lw of information: + Strategy, direction, and alignment emerging from organizational leadership; andvw we 198 9 91 a4 197 203 209 213 219 zi ns + Feedback, learning. and change arising from portfolio, program, project, and ‘business leaders and teams. Figure 2-2. The Value Delivery System For this systm to function effectively, information and feedback should be sharsd ‘constantly between all elements ofthe system. In Figure 2-2, these connections ar reflected in the thee feedback loops + Portfolio review and adjustment. Involves ongoing evaluation ofeach program's and project's alignment with strategy as wel as their probability of business success; + Business impact analysis Incorporates the collccton of result data fom programs and projacts which is fed back into the portfolio; and + Value performance analysis Provides business value realization data fom the Duss wo evaluate how well the strategy of the organization is advancing, ‘This ongoing exchange of information keens the system elements aligned and interconnected «as intemal and extemal factors prompt changes and adaptations ALits highest level, the Value Delivery System i dive by # define stategy ssi ‘or objective (see Figure 2 2). Organizational strategies and objectives evolve in increasingly adaptable ways to aesnmmedat respanses to even the most rapid changes in the ‘extemal environment as well as internal course corrections. 1 realize value, organizations can use a multilayered governance structure consisting of porfolos, progr, projets, anal busines operations ex inpleme sine [governance structures, Organizational leader tailor govemance to the organization cent and needs At the portfolio level, leadars make investment decisions to translate strategy into value forthe organization and its stakeholders. A portolio i a collection of projects programs, subsidiary portfolios, and operations manayed asa group wo wchieve strategic ‘objectives (ce The Standard for Porfolio Management ~ Fourth Edition) Investment {decisions can lead tothe establishment of programe or projects Programs includ related projects, subsidiary programs, and program activities that are ‘managed ina coordinated manner to obtain benefits not available from managing them individually (see The Standard for Program Management Fourth Edition). Programs incorporate and translate strategy into integrated work atvites focused on benefits realization while also delivering within such constraints as budget limitations, stakeholder expectations access to people with requied skis. and availabilty of Projets ean be authorized within portfolios or prosramis or can represent stand-alone iniitives in pursuit of organizational strategy and objectives, Projects can operate within similar constraints as programs. Projects may release all ther deliverables during ‘completion or may deliver weremnenal results throughout their duration. Operational leaders suppor the enhancement an sustainment af pret onteomes to ‘optimize benefits and value Understanding the connections between statexy,portolios. programs. proyect. and ‘operations places projects in thee rightful context within dhe Value Delivery Syste Figure 23 shows two portflias comprised of programs and projects. I also shows & stand-alone program with pnjets and stand-alone projects. The potfotis, eograms, and projets along with the operations comprise the Value Delivery System. The Value Delivery System opetates within the constaints and context of both the intemal envionment and the external environmentnu x0 22 er cy Figure 2.3. Components ofthe Vale Delivery System 2.2 Organizational Governance Systems “The governance system works within the Value Delivery System wo enable smooth workTiows, manage issucs, and support decision making appropriately. Governance systems provide @ framework, funetions, and processes that quide value delivery activities. A governance framework may include elements of oversight value delivery assessment, integration among value delivery component, and decision-making capabilities Govemance systems provide an intezrated structure for evaluating changes issues, and risks associated withthe envionment and any component inthe Value Delivery Systm, including portfolio objectives, program benefits, and deliverables produced by projects. Projects may operate within a program or within a project management offic, either of| which may gavem certain elements af the prject Therefore, project governance i aligned ‘with program and or organizational govemance. Projet governance includes defining the authority to approve changes aac make otter business decisions related 0 the project. 2.3 About Projects A project ie temporary endeavor undertaken to eeate a unique product, service or result The project deliverables support achievement of ene that may not be fully realized by the completion of the project itself. Those benef are intended 1 drive value tothe organization, Therefore, project teams work with business operations or program leadership to ensure that the project result will deliver the desired outcomes that lead to beneits realization and value ‘The temporary nature of projects indicates a heginning and an enn the praject work. A ‘roject ends in one of two ways + Ihe project objectives have been met + The project is tenminate because is objective will ot or cat bent, he ‘ost to deliver exceeds the exposted value, or there is no longer a need forthe project Project management is the application oF knowledge, skills tool, and technigues to project activitis to moot project requirements. Through the use of guiding principles, ‘royect management enables a eam of people to communicate elfeciely. commit to ‘eourinaed actions, and produce results. While the fundatnentl ausibutes of project ‘management continue to apply inthe Value Delivery System, the approach has shifted in Professional practice. Emphasis has mowed from a motel in which processes ape the main uide for structuring the management of projects, to one that uses an adaptable and proactive mindset, lured approselies and wollabottive leadership styles to achieve ‘optimal results, quality, and value, Ther ig also greater recognition that projects are delivered thrxigh the efforts of motivated team members and engaged stakeholders Project teams can produce deliverables using a broad range of approaches. In some projets the requitements forthe intended esul and the steps associated with producing list result say by very clea, Ole projects nay seyuire ongoing exploration au liscovery, through which roquirements and work aetvities are progressively elaborated, Given thie varity the term management, a in the application of contel, may he281 incompatible withthe envirnment, clr, ohjectves, and neomes of some types of 282. projects, Therefore, and to clude al types of project environments, this standard uses 20) the term project delivery to reflec this broader perspective and maintain a focus on 231 outcomes as wel a deliverables, 286. Projcet delivery supports the Value Delivery System by acknowledging and accommodating the 287 heoadening cantimiam of ways in which project results can he achieved Projet delivery, 2 just like the Value Delivery System, is an adaptable capability for addressing the 258_ continuing pace of change in global busines. Itenables people with the skill and 200 knowledge to select tool, practices, and methods to create a tailored approach for 291 delivering results and achieving outeomes. xe 2.4 People in the Project 285. People drive project delivery. Supportive leadership models and meaningful, continuous 204 engagements between projet teams and organizational stakeholders underpin successful Dos business outzomes. The people element of projects enables organizations to experience 290. success with the nherent changes wrought by projects. Members ofa project team and other 29r stakelolders identify, evaluate, and respond to projet commit w increase he 200 probability of suosess, 200 300 Coordinating collective work effort i essential to the success of any projec. There are 40 different types of coordination, each suitable fora specific context. Some projects ‘02 henefit trom decentralized coordination in which team members selF-organize and 203 sel:munage, Other projects benefit from centralized coordination wih the leadership and 204 guidance of a designated project manager or similar role 200, Regardless of how projects are coordinated, project delivery recognizes the human dynamic 207 of projects. It emphatizes the projeet team asa whol, since the collective effort 308-prvduces the project deliverables and directly supports the Value Delivery System. In this 509_context, project teams or groups of contributors may include all or some combination of 210 the following roles and responsibilities: an 512 + Project lead. Guides dhe tum i eatying out work ssiganients effectively and 239 efficiently S14 + Faciltatarienach. Maintains eulture of teamwork, learning, and mutual spect 819+ Team member. Completes assigned work in collaboration with other contributors. 210 + Business representative/product owner. Maintains an ongoing lationship between 117 the projet and business objectives 818+ Domain subject matter expert'support team member. Provides required expertise oF 319-support for shor intervals throughout he project 320 = Customer/end user. Provides input and insights to the tar so the resul mets £01 customer or end-user expectations. 822 + Sponsor. Provides senior management support and ensures availability of funding 525 alot wesoutes, S21 + Governance board. Provides guidance and decision making support for escalated issues. ms 828 Each ofthese roles—and other stakcholders—provide input and opinions on how they may be “07 affected by a decision, atvity, of outcome of a project. 828 24.1 Project Lead 199 The project lead, who may be called the project manager, serum master, or one ofa number 580 of athe ites eps the tam to achreve proyect objectives. typeally by orchestrating 291 the work of dhe projet. The spevities of his roe and how dhe functions are carried out 282 within the projec fam ean vary among organizations, but typically include playing @ 209 leadership role to help the team achieve project objectives. This role is clearly visible $34 throughout any project. In some orvanizations, a project lead may be involved in 2899 evaluation and analysis wetvities as pat ofthe project proposal These wtivities may 226 include consulting with executive and business unit leaders on ideas for advancing S57 objectives, improving organizational performance, oF meeting customer nowd. In other 238 organizational settings, the projet lead may also be called upon to manage or assist in 200 usiness analysis, tendering and contract negotiations, business case development, and 240 aspects of portfolio management for a projet. A projet lead may also be involved in ‘M1 follow-on activites related to realizing and sustaining benefits trom the project after ‘42 the projet finalizes its deliverables but before formal closure ofthe projet. 848. Ultimately, the role and tle of project lead is tailored to fit the organization, just, “Us as project approaches ae tailored to fit the projec. &9 2.4.2 Facllitator/Coach “UB. Tho role ofa facilitator, coach, or project manager can overlap. Facilitators encourage ‘47 team member partiepaton, collaboration and a shared sense of responsibility forthe‘8 team’s work output, Facilitators help the team ereate acceptable solutions. resolve ‘4 conflies, and make decisions, Faciliaros coondinate meetings and contribute in an 850 unbiased way to the advancement of project objectives ast 352 Coaches assist people through change and help addcess barriers that may prevent success 359. Coaches observe individual and team performance and provide teams and their members with 54 feedhack fo help them learn, adapt and improve in rel time, os9 24.3 Team Member 350. Team members provide the skis necessary to produce a result, such asa working proluct sor Team members may join as dedicated or temporary members, depending on the needs and 850 resoures ofthe organization. Some projects need highly specialized team members, while 269. other projets can benefit from teams whose miembers have broad skill sets 60. Crosstunctionl team members representing diferent parts ofthe organization can provide 361 amix oF internal perspectives, establish allies with key business units, and aet as 262. change agents within thie Functional areas. Tear members may aso play key suppor roles [m3 asthe project deliverables are implemented or transitioned into operations. 2.44 Business Representative/Product Owner 285. A product owner or business representative guides the direction ofthe product a projet $66. result and priontizs the requirements or backlog based on business value, dependencies, a7 snl veluial ov operational ish, These voles work with prujet tas frequently, by 260. providing feodback and setting direction forthe next inerement or element tobe developed 269 op dalivered These mle ala work with other stakeholders, customers, an hei eam 3/0 define the produet direction. {72 Image and yb environments, project teams can establish atime box for 979 demonstration, feedback, learning, an wpuability wi a cadence dat is practical for 274 the stakeholders who are impacted. In predictive environments, tsams use designated 75. checkpoints fr presentation af an feedback on project progres withthe business 376 representative and other key stakeholders. In some instances, the business representative 577 ox product owner may Tall sponsor duties as well The business representative funtion 378. may be conducted through proxy. For example, in some government and construction projets, 879 contract with an agency or eonsultaney may represent the owner or customer 200 2.4.8 Customer/End User 81, The customer and end user are not always synonymous. Far the purpose ofthis standard, the ‘82 customer is defined as the individual who has requested ors funding the work and may 2a also fill he role of business representative discussed cai. The end user i the at person or group who will make direct ue ofthe project deliverable 886 Project teams establish mechanisms for guining perspectives from both customers and end 227 ser. Projct teams ned tn tain clear dreetion fm customers and and users megaing {88_project requirements, outcomes, and expectations. For agile and innovative project teams, 08 this ned for ongoing feedback is greater because the teams ae exploring and developing 300 product cloments within specific ineroments. In some project environments, the eustomer oF 591 end user engages with the team for review and feehack periialy. In some projects, a 282 representative ofthe customer or client participates on the project team. Regardless of 203 the delivery approach, customer and end-user interaction ae determined by the nature of 29 the guidance roqui 289 2.4.6 Domain Subject Matter Expery/Support Team Member 898. Some projets requir specific expertise or tupport at various points ofthe projet work: 897 ‘These individuals contnbute to the team’s work and learning. However, thetrpartirpation 290 is generally limited tothe specific vimetrae in which hei expertise or support is 300 required. 400 2.4.7 Sponsor 40% Sponsors act as bridges between the organization’ strategic or business objectives, the 40?_project team, and the project outcomes. Project sponsors communicate the organization's 405 vision, goals, and expectations tothe team, They are advoeates for the projet and the 40% team by helping wo secuse the Uecisious, resources, unl arity dat allow projet 405 activites to progres. In some eases, the sponsor also uli the role of business 405 representative ar prvi eximer 408. Sponsors also serve as an intermediary between senior management and the project tam, 409 “They play # supporting ole m keeping projects aligned to business objectives, removing. 410 obstacles, and addressing issues outside dhe buunds of de project tens devision417 authority. Sponsors can also fecilitate innovation by identiying opportunities that arise 412 within the proeet and communicating these to senior management. Lastly, sponsors often 419: monitor project outcomes after projet closure to ensure the intended business benefits 4114 are realize. “19 2.4.8 Governance Body 4118 Some organizations use governance bodies to maintain linkages between project teams and 417 strategic or business obyectives that may change over the course ofthe proect. The 418 governance budy is review and decisio-ing group usually comprised of senior {10 executives andlor business unit leaders. The governance body is responsible for approving 420 and supporting recommendations made hy the projet team and for monitoring prject 421 progress in achieving the desied outcomes. In some organizations a project management 422 office (PMO) serves asthe governance body for projects under its auspices 42 2.4.9 Stakeholders 424 Sakeolders include individuals, groups, oF 0 125 by. oF poresive themselves tobe affected by a 426. project. This definition inches all project roles discussed here, as well 382 much 421 ‘broader range of individuals. Ulimately, stakeholders determine whether project results 420. and outcomes mect their needs and proce valuc. Project teams collaborate with 428. stakeholders throughout the projet to enable project deliverables that produce the 480 desired outcomes. An outcome-focused approach improves the team’s ability to deliver a 451 solution that suppor achievement of the intended outcomes and creates value for 492 stakeholders, «© 2.5 Projects and the Environments in Which They Operate 12 Projets exis ond operat in environments that may have nin tvenee on ther. These 45 influences can havea favorable or unfavorable impact onthe project. Two major categories 490 of afc at enterprise cavitomentl fc (EEF) an onguizaional proces ‘27 vets (OPAs). EF? originate from he environment outside ofthe projet and fn, 488s of th entero, FFF may have an rar a the npaniatonal, pi, 409 program, of prot lve, OPA re intra othe onnization, These ma rs rom he “0 enanization itself a pot, program, another proj, ora combination ofthese 2.5.1 Enterprise Environmental Factors 4442 Enterprise environmental fctors (EET) reer to conditions that are out of the contol of 49 tho project tam and that infuonee, constrain, or direct the project. Thece conditions 464 canbe intemal andor external to the organization. BEFs may enhance or constrain project 445, management options. In adton, these factors may have @ positive or negative influence 445 onthe outcome. 440 The following EEF ae internal tothe organization 400. + Organizational culture, structure, and governance. Examples include vision, 461 mission, valucs, blifs, cultural norms, leadership style, hicrrchy and authority 459 relationships, organizational syle ethics, and code of eanduct. 495 + Geographie distribution of facilities and resources, Examples include factory 454 locations, vstual ean, shaved systems, and cloud eomputis frastructure. Examples include existing facilities, equipment, organizational 488 telecommunications channels, information technology hardware, availability, and eapacity 491+ Information teennology software. Examples include scheduling software tools, 450 configuration management systems, web interfaces to other online automated systems, and 450, work authorization systems. 490+ Resource availability. Examples include contracting and purchasing constrains, 45 approved providers and subcontractors and collaboration agreement, 462+ Employee capability. Examples include existing human resources expertise, skills, 48% competoncies, and specialized knowledge 4166. The following EEF are external to the organization: 4167 + Marketplace conditions, Examplss include competitors, market share, brand 488 recognition, and trademarks, 469+ Social and cultural influences and issues. Examples include political climate, 470 guuks of vouduet, ties, aud peeeplions 47)» Legal restrictions. Examples include county of local laws and regulations related 472 tn soci, data protection, business conduct, emplayment and procirement 4/5 + Commercial databases, Examples include benchmarking results, standardized cost 474 estimating data, industry risk study information, and risk databases+ Academic research. Examples include industry studies, publications, and 476 benchmarking results. 477 + Government oF industry standards. Examples include regulatory agcney regulations 47% and standards related to products, production, environment quality, and workmanship. 479+ Financial considerations. Examples include cureney exchange rates interest 460 rates, ilaion rates, ails, ad yeogrephie location. 401 + Physical environmental elements, Eyamples include working conditions, weather, and 494 2.5.2 Organizational Process Assets 405, Organizational process asscts (OPA) are the plans, process, policies, procedures, and 488 knowledge bases specifi to and used by the performing organization. These assets 427-inlence the management of the proyect. OPAS include any artifact, practice, or knowledge 498. frum any or all ofthe performing organizations involved in the project. They can be use 460 to exgcute or gover the project, The OPAs alo include the organization’ lessons leamcd 400 from previans projects and historical information. QPAs may include completed schedules, 481 isk data, and related data, Since OPAs ae intemal tothe organization, project teams 492 peau add the OPAs as uewessty Unoughout ie projet, «° 2.6 Project Management, Program Management, and Product Management 401 In today's businose world, the disciplines and domains of projoct management, program 495, management, and provict management are hecaming more interlinked. This i particularly 490 true with regard 0 digital and sofware-enabled products and services. While program 497 management and product management are beyond the scope ofthis standard understanding 498, each domain ad the relationships between them provide a useful context for projects 499. whose deliverables ae products or services 501A practi a system, tangihle abet, ar component that ean he citer a sepnrate end v2 item or @ component item. Product management involves the integration of people, data, 89 processes, ad business systems o create, maintain, and develop a product or service S01 throughout its lifecycle, The product lifecycle ia erie of phases that represent the 505 evolution ofa product, trom concept through delivery, growth, maturity, and to 6, Product management may initiate projects or programs at any point in the product life s09 eyelet create 1 enue specific eomponents, fuutions, o capabilites (see Figure 510 2-1), The intial product may bogin as a daliverable ofa projector program. Throughout 511 its ifeeyele, 2 new projector program may aor improve Functionality that ereates 12 additonal value for customers and sustains the benefits oF the producto te sponsoring 1513 organization, In some instances, a program may encompass the fll lifecycle of a product 514 or service to ensure that the product realizes intended business benefits and produces 515. value forthe organization 519 Figure 2-4, Project, Program, and Product Lite Cycles 521 For digital produets, which are products or services that are delivered, used, and stored 522 In an electonic fora, organizations are using adapable platforms to satisfy customer 525. noeds, The platforms provide core Functions such as inputting snd processing data and ‘94 outputting information or results, Software components and features leverage those core 525. fumetions to deliver unigu capabilities that mect customer needs, such as taking and 0 sharing photographs, facing busines transactions enabling neworking with hers, 527 and so forth. IF organizations are mindful oftheir markets and trends ond develop new528 features and capabilities for delivery via a platform, they can sustain benefits 29 realization as long as the platform and capabilites continue to satisfy customers. These 550 digital products re often developed and managed using long-running, stable teams and ‘90 inremental funding models. 558 Product management may exist in different forms, including but not limited to: 525 + Product management within « program. This approach incorporates elated projects, 538. subsidiary programs, and progrim sotivties managed in eaarnated manner to abn 537 benefits not available from managing them individually n this case, a subsidiary program 538 continually produces new felutes and eapabiiis, A sets of projec implemeuls 550 platform enhancements and upgrades as noeded. Finally, program activities capture and 510. analyze customer data ta identify patterns of emerging neds os) + Product management with a combined approach. This aporodch oversees development of "2. new features and capabilites as an ongoing business activity while chartering individual 12 projects as needed to perform platform enkancements and upgrades orto produce other unique results While product management is separate discipline wit ts own hady af knowledge, it 47 represents key integration point with the Value Delivery System within the program. S40 management and project management domains. Progtams and projects with deliverables that 510 include products o digital products ue tailored and integrated approach that 550. incorporates al of the relevant badies of knowledge and their related practices, method, 91 artitets, and so on 3 s+ Project Delivery Principles 555 Principles define the what and why of project management. Project delivery principles 80 guide the behavior and thinking ofall who are involved in projet delivery, 80 these £57 individuals can apply thee efforts to achieve stronger outcomes. 8 599 Principles deseribyu funda uth nor, ut value, They are pareters widhin whic 560. projet professionals operate, These principles are not prescriptive, They are broadly 561 hase concepts that enahle individ to envision and achiawe alignment with the intent 62 ofthe principles witle carrying out project work 561 ‘Iwelve principles provide guidance fr eflective project management, The degree of 565. application of eaeh principle is influenced by the context oF Ue organization the 556. project, deliverables the toum, stakeholders, and other factors. The principles are S07 listed here without any specific weighting or order and elaborated inthe following 568 sections. The principles are: 570 + Bea iligent, respectful, and caring steward, 871+ Builda culture ofaccountabilty and respect. 572+ Engage stakeholders o understand ther interests and needs sm + Focus on value 574» Recognize and respond to systems” interactions. 3, influence, coach, an ea 576» Tailor the delivery approach based on context, S77» old quality inte processes and rests, 78+ Address complexity using knowledge, experience, and leaning 579» Addiess opportunites and threats 580 + Be adaptable and resilient. 581+ Fable change to achieve the envisioned future state = g 3.1 Be a Diligent, Respectful, and Caring Steward06 sa sar ‘Be a diligent, respectful, and caring steward. ‘external tothe org 1 Stewardship indudes: (©. Duty of integrity, © Duty of care, (© Duty of loyalty, and (©. Duty of compliance. ‘© Stewardship encompasses. responsibities within and ‘+ Aholistic view of stewardship considers financial, socal, ‘Betng steward emtals acing responsibly to carryout activities wish imegrty, care, «and loyalty while maintaining compliance with internal and external regulations. Stewards demonstrate a broad commitment to care for nancial, social, and environmental resources. Stowardship has slighty different meanings and applications in diferent contexts. One aspect of stewardship invaves ing entniste! withthe care af something. Another aspect focuses on the responsible planning, use, and management of resources. Yet another aspect means upholding values and ethics Stomandship encompasses responsibilities bo wit Within the organization, stewardship includes: sad ester othe organization, + Operating in alignment with the organization its objectives, strategy, and sustainment ofits long-term value: + Respectl treatment and engagement o people throughout the organization, including their compensation, acces w opportunity, and fir rearen; + Diligent oversight of organizational finances and materials used within project; and + For individuals in any leadership position, understanding the power and responsibilty associated with that fol. Stewardship ouside the organization includes responsibilities in areas suchas: +The arganization’s impact onthe natural environment and its se of materials and natural resources; and + The organization's selationship with external stakeholders such as its parters and channels, as well asthe community, country, andor ropion in which it operates. Stewardship reflects understanding and acceptance of trust as well as actions and {ecisions that engender snd sustain that rst. Stewards adhere to both implicit and explicit duties. These may include the following + Integrity. Stewards behave honestly and ethically in ll engagements and ‘communications. Stewards hold themselves to the highest standards and reflect the values, ‘principles, and behaviors expected of those i thie organization, Stowards serve a role ‘models, building trust by living and demonstrating personal and organizational values in their engagements, work activites and decisions. Inthe project delivery context this duty often requires stewards wo speak uth w power, w challenge wan meters, pees, and other stakeholders to consider their words and actions; and o be self reflootive and ‘open tn fodhaek * Care. Stewards are fiduciaries ofthe organizational matters in their charge, and they diligently oversee those matters. They pay close attention to those mates and ‘exercise the same lvel of care over them as they would thie personal matters. Care ‘relates to the internal business affairs ofthe orpanizaton, through organizational Policies and principles, and often encompasses care forthe envionment, sustainable use ‘of natural resoures, and concer for the conditions of poople across the planet, Projects ving about elamges tht way ave waaticipated or uuwanted consequences, Puject management practitioners identify, analyze, and manage the potential downsides of projet ‘ontcames to ensuite stakeholders are aware and informed Duty of car includes creating a wansparent working environment, open communication channels. and opportunities for stakeholders to raise concerns without penalty or fear of reibution = Loyalty. Stewards represent themselves, ther roles, their team ond their authority accurately, hth inside and outside ofthe organization, This behavior ensures ‘that other people understand the degre to which an individual can commit resources, make ‘decisions, o approve something, Loyalty also ensuies that individuals proactively identify conflicts between ther personal intereets and those of thei organization or client. Such conflicts can undermine trust and confidence, result in unethical or legal behaviors, create confusion, or consibue 1o suboptimal results. Stewards protect, projects ffom such breaches of trust + Complianee. Stewards comply with laws, rules, regulations and requirements that‘8 are properly authorized within or outside oftheir organization, Stewards ensure ‘9 compliance with guidelines intended to protect them, their organization, theit 650 stakeholders and the public at large. In instances where stewards face eonfiting 651. guidelines or questions regarding whether or not actions or plans align with established 652 pudelins, stewards seek appropriate counsel and direction, 1654 Stewardship presribes leadership with transparency and tustworthiness. Projects affect 655_the lives ofthe people who deliver them as well as those who bene fom the project, 650 deliverables and outcomes. Projets can have effects such as easing traf congestion, 657 producing new medications, o eeating opportunities for people to interact. Those effects 658. may produce othe, negative ampacts and consequences, suchas reduced greenspace, side 099 effets from medications, or dselosute of personal information, Project wats and dhe £50 organizational leaders carefully consider such fctors and impacts so they can male 81 responsible decisions, balancing organizaionsl and project objectives with being 9 good ‘82 comporate citizen {664 Increasingly, organizations are taking a holistic approach to business that considers 69 nancial, socal, and environmental performance simultaneously instead of soquentilly. 666 Since the world is connceted now more than ever and has inte resources and a shared 07 environment, stewardship decisions extend bayond the project. Thase actions lead to good 88, global etizenshi, om 3.2 Build a Culture of Accountability and Respect Build a culture of accountability and respect. © Projects are delivored by team. © Teams work within organizational and professional ‘cultures and guidelines. Teams establish their own culture. ‘A culture of accountability and respect faciitates: (© Alignment withthe other organizational cultures and ‘uidelines, (© Individual and team learning and development. and (© Optimal contributions to delver desired outcomes £72. Project teams are made up of individuals who pool their collective skills, lnowledge, and 61% experience. Team that work collaboratively cam accomplish o shared abjecive more 674 effectively and efficent than can individuals working on thetr own, 676 Creating a collaborative team culture involves many contributing factors. Chie among them 677 are team agreements, structures, and processes. These futors create a culture that 678. cnables individuals to work togethor and provide synergistic effets from interactions on 0+ Team agreements. Estab 621 to the group 682 + Structures. Represent an approach for organizing and enordinating individual 635 efor assoclated with the work that needs to be completed, Structure may be based on a4 roles, fanetions or authority. An authority figure may formally impose a structure, or «95, team members may agree to a structure as they join the group. 680 + Processes, Represent enablers for completing tasks and work assignments. For ‘97 example, projet teams may agree wo a decomposition process using a work breakown 688 structure (WBS) or a backlog. h behavioral parameters and secure individual commitments 80 Project teams ae influenced by the culture ofthe organizations involved in the project, 1691 the nature ofthe project, and the environment in which they operate, Within these 682 influences, roject teams establish their own cultures. Teams can tailor thee structure 629 to best accomplish the project objective. Fostering an inclusive and collaborative 04 environment that i aligned withthe organization's values enables the tm to achiove 05. project outcomes, 607 Teams exist within and maintain an awvarenens of organizational and professional culturse 698, within which the project resides. The team defines the desired team culture and sets 699 agreements withthe aim of establishing a high-performing, integrated culture. This places 700 a greater value on visibly modeling belief, principles, and organizational values in 0" behaviors and actions. Even when cultural business norms are imple rather than 702 explet they inform the proyct and therefore must be megrated nto the project 3 culture. The responsibilty oF the team is wo ensure at individual contribution, 704 behavior, and overall tsam actions align with and suppor tated organizational values 7 700. Within project teams, specific tasks may be delegated to individuals or selected by team‘members themselves. This includes the authority, accountability, and responsibility related to tasks: + Authority Provides an individual or group withthe right to make decisions, establish procedures, and commit resources + Accountability. The condition of bsing solely answerable for an outsome Accountability i nt shared, + Responsibily. The condition of being obligated ro do or ful something. Responsibility ean be shared. Reyavdles of wh is accountable or vespousible fox spevitie projet work, a tea tha ‘embraces a culture of accountability takes ownership eolloctively ofthe project outcomes [A diverse tcam can enrich the projcet environment by bringing together different petspactives. The team can be comprised of intemal organizational staff contracted ‘contributors, volunters. or extemal third partes for example. Additionally. some team, tubers jon the project ow otter basis w work on spose deliverable while ‘other members are assigned tothe project ona longer term bass, Integrating these individuals with »penjact team can challenge everyone invalved team enlte af respect ‘2 allows for differences and finds wavs to leverage them productively, rater than allowing 727 them to raise conflict. 729. Another aspect of wecountablity an respect fs accommodating practice standards, ethical 720 codes, and other guidelines that are par of the professional work within the tsam andthe 731 organization. Teams consider how these guides can support ther efforts to avoid possible ccontiet among the disciplines and the established guidelines they use. Accountable and respectful team culture fosters the tree exchange of information and individual knowledge. This, in turn, maximizes shared leering and individual development while dlivering results. The tcam culture enables everyone to contribute thei best 137 efforts to deliver the result and desired outcomes for an organization. The organization, 750 in tum. will bene from deliverables and outcomes that respeet and enhance its 739 fandatnentl values, principles, a eure, ‘«: 3.3 Engage with Stakeholders to Understand Their Needs and Interests Engage with stakeholders to understand their needs and interests, © Stakeholders influence projects performance, and © Project teams serve stakeholders by engaging with stakeholders © Stakeholder engagement proactively advances value selivery. 1 744, Enyaye sukeholders prouctively und to the degree needa to contribute to project success 746 A stakeholder can be an individual, group, or organization. Stakeholders may affect, be 747 affccted by, of peresive themselves to be affected by a decision, activity, or outcome of ‘48 a portfolio, program, o project. Stakeholders also directly or indirectly influence a 749. proect. ts performance. or outcome i ether a positive o negative way, 751 Stakeholders can affet many aspects ofthe project and in certain ways, including but not 752 limited wo Ds Tot + Seopeirequirements. By revealing the need to add, adjust o remove elements of 709 the seupe and/or reyuirewsents. 756» Schedule. By offering ides to accalerate delivery or by slowing down key pojost 151 activitos ‘98 + Cost, By helping to reduce ot eliminate planned expenditures or by adding steps ot 759 requirements tha increase cost or require additional resources. 760 + Team. By restricting or enabling access to people with the skill, knowledge, and 161 experience needed to deliver the right result ea + Plans. By providing information for plans or by advocating for changes to agreed 758 activites, ask, and work vai + Outcomes. By enabling or blocking work or results raquired forthe desired outcomes 705 + Culture. By establishing oF inluencing—or even detining—te level and character ros of egagernen oF die projet waa and browder organization Too. Stakeholders may come and go thoughout the life eycle ofthe project. Additionally, the 709. degrve ofa stakcholdcrs interest or impact may change overtime, Stakeholders 770 especially those with a high degree of influence and who have an unfavorable view about am2 0 en ow wa wr 0 project, need to be effectively engaged so that their interest, concerns, and rights are understood, The project team can then address these cancers to help ensure a more suecessful projet outcome. ‘Therefore, project success comes from ientifyng, analyzing, and engaging with stakeholders from the stat to the end ofthe project. Project teams engage stakeholders by understanding, considering, and responding ta the imorests, needs, and opinions of stkeholders. Effective engagement and commenieation includes determining how, when, how often, and under what circumstances stakeholders want Wo be and should be—engayed. Couunanicaion is hey pat of engageneat, but engagement delves doaper to include awarenas of the idea of ethers, assimilation of other perspectives and calletive shaping ofa shared salut. Engagement means building and ‘maintaining slid relationships through frequen, two-way communication. I encourages collaboration through interactive mectings, informal dialogue, and knowledge-sharing activities, Staksholder engagement relies heavily on interpersonal skills, including initiative, integrity honesty, collaboration, respert, mavesty, and confidence These skis help ‘everyone adapt tothe work and to each other, increasing the likelihood of succes. Engagement helps project teams detect, collect, and evaluate mformation data, and ‘opinions, This create share! understanding and lignment, which enables projet outcomes. ‘Additionally, these activities help the tam to tailor the projet to identify, adjust, and respond to changing circumstances in realtime Projet teams actively engage staksholders throughout the project to mitigate potential negative impacts. Stakeholder engagements also enable opportunities for stronger project, performance and outcomes. Finaly, engaging stakeholders helps the team to find solutions that may be more acceptable toa broader range of stakeholders. 3.4 Focus on Value Focus on value. Value ic the ultimate indicator of project suceace Value can be realized throughout the project, a the end of the project, or well after the project is complete, ‘© Value, and the benefits that contribute to value, can be defined in quantitative and/or qualitative terms. © Afoeusan cuteomes allows teams to support the Intended benef that lead to value creation. Project teams evaluate progress and adapt to ensure the expected value can be realized a0 Continually evaluate and just project alignment to business objectives nal intended vale Valuc, including valuc from the perspoctve of the customer, is the ultimate success indiemor and driver af prjeots. Value facuses on the outcome af the result, not only on ‘the result. The value of a project soften expressed asa financial connbution to the uy or weeiving exgauization. Value uy be a unease uf public yoo achieved, fo oil benefit othe customer's perceived benoit from the projet result, When the prnjest ia component af'a programs, the penjet's contribution ta pengram nieomes ‘can represen vale, [A business case or similar artiact defines the rationale and desired outcome from prosect otk. A busines ease contin information about straie alignment, wsoestnent Of tsk ‘exposure, expectod key performance measures, and alternative evaluations. The business ‘ease may sate the intended value contribution ofthe penject teams in qualitative ‘quantitative terms, or both. The business case contains two supporting and interrelated cements + Business need, Provides the rational bass forthe project, explaining why the project is undertaken. It provides dctails about the business objctves. The business ‘need may be intended fr the performing organization, a client onzanization, a partnership ‘of organizations. or public welfare, A clea statement ofthe business need hes the )rujet tea understand dhe buses duvets. Ital allows de teat Wo ideify ‘opportunities ta inerease the potential value from the project outcome * Project justification. Connected! business need It explains hw the proposed solution addresses the business need Together the project sustification and business need provide the team with informationor 836 as 53, 0 66 0 70 73 9 5 38 ‘that allows them to make informed decisions to meet or exceed the intended value Desired atcomes should he elearly stahlishet and updated thrghout the project: Paring it tie evel «project undergoes change, and the team adapts in esponse. The team continuously evaluates project progress and dicetion against the desired outcomes and ‘busines case to ensure tha the project remain the business case is deliver its intended outcomes. Alternatively ligned to the business ease and will undated to capture an ‘opportunity identified by the project team. Ifthe project is no longer aligned withthe ‘business need or seems unlikely to provide the intended value, the organization may choose to terminate the effort When value is expresed in financial terms, it is often based onthe formula of benefit minus cost realization af henefit in excess of invested expense is expressed as ‘positive value. The converse is expressed as negative value. However, Benet and cost need not be is sto financial terms. The benefit may be some measure of social good, ‘organizational transformation, or attainment ofan ethical standard. In these cases, positive value may be a more subjective determination, Within the context of some prjerts, project teams maximize vale tothe customer hy Complexity can be introduced by events or conditions that affect value, cope, communications, stakeholders, "sk, Innovation, and technologies. «Teams can stay vigilant in identifying elements of complexity and use a variety of methods to reduce the “amount or impact of complexity. 21 Continually evaluate and address complex profet elements so that approaches and plans can ‘212 successfully navigate the projec life evele. 23 1214 A project isa system of elements that interact with each other. The nature and number of 1285 the interatione determin the degree of complexity in a project. Complexity emerges from 210 project elements, interactions hetween project elements, and interactions with other 27 systems, such as the environment in which project work takes place. Addressing complexity 1210s challenging because ofthe structure ofthe project system and the rate at which change 12ccus.Itean be neither managed nor controlled, but teams can address it +221 Project teams often eannot foresee complexity because it isthe result of many’ 22 interactions sch as sks, dependencies, events, or relations. Altematively, afew iz causes may converge to produce a single complex effect, which makes isolating a specific ‘224 cause of complexity dificult. 1225 1226 Wihin project delivery, complesity ia characteristic of Ue project system au the 1227 individual elements within the system. Por example, complexity within a project may be “228 amplified with a greater number or diversity of eakeholders, such as regulary agencies, 1220 ternational financial institutions, multiple vendors. numerous specialty subcontractors, +200 o¢ local communities. These stakeholders can havea signiicant impact on the structural 1231 complenity of a project, oth individually and collectively. “253 Among the many sources of complexity, the forsimost are tn “205 + Human behavior. The interplay of conduct, demeanors, and attitudes of people 1238 Human behavior also contributes to complexity by introducing elements of subjectivity (237 + System behavior. The result of dynamic interdependencies within and among project, 1238 elements. For example, the integration of different echnology systems may cause threats +200 that could impact project results and success, The iterations among components of the ‘000 project system may lead t interconnected risk, creste emerging or unforeseeable issues, ‘247 and produce unclear and disproportional cause-and-etect relationships. z+ Ambiguity. A state of being uncleat, of not knowing what expect, oF How 218 comprehend situation. Ambiguity ean arze from having many options, yet a lack of ‘244 clarity om the optimal choice TInclear ar misleading events, emerging issues, oF +z subjective situations can aso lead to ambiguity. ‘A lack of understanding and awareness of issues, events, paths to “217 follow, or solutions to pursue. Uncertainty may increase and amplify issues, isks, +248 behaviors, or situations which are internal and external to a projet. Uncertainty 1249 Includes wnknovn-unknowns, which are emerging factors that ate completely ouside of 250 existing knowledge or exporonec 251 i252 Complexity una eaerge ai create inact on te project al 1253 often surfaces in one of hove areas se 1255. + Value. The value of projcet outcomes shifts asthe extrnal environment changes, "95 stakaholdor needs shift, scope evolves, schedules change issues arse, and so forth. The 1257 expected value of the project results may mnerease or decrease or may be delivered cari 258 ole ha originally expected, In extree ees de projet may be cancelled because 250 there is no longer enough valve to justify the continued investment 1280» Seope. Ina complex environment, itis frequently impasse to define completly 201 the projet scope in ts intial stages. As the project unfolds and te team learns more +202 abut the deliverable and the intended outcomes, the inital scope will kely undergo 253 changos. Some changes may be disruptive, prosonting the team with challenge in 254 controlling hoth the project work and the relationships among stakeholders, 1259+ Communteattons. Complexity ean emerge ftom having many communication sources. 1208 These sources incade communication in global, multisite projects project teams oF +267 organizations that operate in diverse languages, cultures, or politial structures: 268 virtual teams: and the proliferation of professional and soctal communication channels. 1209 + Stakeholders. Stakeholders introduce complexity in several ways, They often have +270 compotng interests on a projet. Social and political stakeholder interactions may 1277 produce dificult conditions for the project team. Stakeholders may have strong and ‘272 diverse opinions regarding processes and methods for managing the project. Some ints ie eyele ny poi2 stakeholders may als leave the project along the way. and new stakeholders may introduce 1274 ideas diferent from thse ofthe previous stakcholders, 1278. + Risk, Complex conditions presen an environment with an increased level of isk ‘78 This sk ie sesocited withthe individval causes of complexity and by the ‘277 mterdependencies among. and combinations of, a project’ ented risks, These risks 27a presen oppuoranities or dasa 279. + Innovation and disruptive technologies. The speed of technological advancements, {280 including the Intemet of Things (laT),aiical intelligence (AM), Klackehain, and 21 unknown unknowns, means that new and innovative solutions to problems and new ways of| +202 working aise coatinuously. These have the potential t help move the project towasd a 1283 solution orto disrupt the project with more change and increased complexity 1285 Some types of projects are prone to higher level of complexity than others. For example, {28 projects with lengthy durations may encounter complexity because much within and ouside 1267 ofthe project may change as time passes. Complex elements may introduce additional 238 interdependence, whic in ui may fares iaciease the level of eomplenily within the 1280 peoject 290 ‘1201 Projet teams can identify clements of complexity throughout the project by constantly 1200 looking atthe projet system ae well as ie component parte for signe of complexity 1253 Teams can also use a variety of methods fo experiment and clarity requirements to help 254 reduue compleity 12 Knowledge of complex systems, experience ftom past project work, experimentation, and 237 continuous learning related to system interaction lead to the project car's increased +208 ability to navigate complexity when it emerges. Understanding the layered nature of | 299 complexity and being vigilant fr signs of allows teams to adapt their approaches and 309 plans to onitol amy potential discuption Wo eective project delivery ‘303,10 Address Opportunities and Threats ‘Address opportunities and threats. © tndvidual and overall eke can impact projects. Risks can be posite (opportunities) or negative (threats). © An organization’ ck attitude, appetite, and thresholds influence how risk s addressed. 1209 © Risk responses should be: © propriate tothe significance ofthe risk Cos effective in meeting the challenge Realistic within the project context ‘Agreed upon by al parties ‘Owned by a responsible person 04 Consistently evaluate exposure ta risk hath appartunities and teats, ta harness 08 positive change and minimize negative impacts 10 the projects outcomes, thereby ‘20¢ maximizing the value contribution ofthe project. ‘207 208 Arik isa event or ondiion Ua, ii occurs, can havea pusitive wr negative effet 100 9n one or more objectives, Risks may or may not materialize in project. Project tsams ‘210 dntify and evalinte known and emergent sks, hoth within and outside af the peor 0 early and throughout the life eyete. 18 Project teams aum fo capture positive msks (opportunites) othe extent possible while 21 decreasing the penta impact uf negative risks (heals). Threats may result in issues ‘216 such as delay, cost overrun, technical failure, performance short, of loss of “316 reputation. Opportunities can lead ta benefits seh as reduced time and cost, improved ‘317 performance, increased market share, or enhanced reputation. 318 Teams also monitor the overall project risk. Overall project risk i the effect of ‘20 uncertaimy onthe project asa whole. Overall risk arises from all sources oF 52 uncertainty, including individual risks, and represents the exposure ofthe stakcholdcrs «0 othe implications of variations in project outcome, both postive and negative 1323 Management of overall proyect risk aims to Keep projet risk exposure within an acceptable 52 age, Managemen seuteges include reducing drivers of negative vation, promoting 1225 drivers of postive variation, and maximizing the probability of achieving overall project +28 ahjertives “528 Projet teams assess an organization's risk atituds, which ig a funetion of risk appetite (29 nd nsk threshold, They hold discussions with project stakeholders asthe primary source 220 of understudy dese Talons. wise + Risk atttude describes a disposition toward uncertainty, adopted explicitly orimplicitly by individuals and groups, driven by perception and evidenced by observable 1224 behavior, 1585. + Risk appetite describes the degree of uncertainty an organization oF ‘06 willing to accept in anticipation ofa reward. 1357 + Risk threshold i the measure of acceptable variation around an abective that 8 rllects the risk appetite wf de urgaizaion sud sakes, 0 These parameters for risk can prescribe how the project team navigates risk Ina project. © For example, as a result of a risk intervention, the team may identify n opportunity that ‘42 could greatly increase the value ofthe project deliverable, However the team assesses 49 sk nthe context ofthe organizavon’s culture to determine the probability of ‘98 capturing value, Then the tam considers the organization's appetite Tor ting tsk, ‘216 including how much changeit is able of willing to tolerate, Consideration ofthe ‘a attitude, appetite, and threshold for risk ean determine whether the risk presents | ‘37 threat or an opportunity, whether or not to engage with te risk, and the proposed actions 8 tha the ean would ake i response '380 Effective and appropriate risk responses can minimize individual threats, maximize +551 individual opportunites, end reduce or optimize overall project risk exposure, depending +269 on the risk. Project tama identify potential isk responses withthe fllowing 1353 characteristics in mind: 1355.» Apmopriate for the significance of the risk, 1399 * Costemective in meeting te challenge, 1957 + Realistic within the project context, ‘388+ Agreed upon by all partis involved, and (9+ Assignable toa single individual 2951 Racanse projects are part ofa system af systems, risks ean exist within the enterprise, ‘he portfolio, program, and project. The proect may be a component of a program in which the “20 risk can potentially enhance or diminish benefits realization and, therefore, value. The 1204 project may be a component of a portfolio of elated or unrelated workin whieh the risk 365 can diminish or enhance overall value ofthe portfolio and realization of business 386 objectives. 368 Onzanizatons and project teams that rely on proactive risk evaluation and planning often 208 Find the effort tobe less costly than simply reacting to issues when the tsk +270 materializes, and a proactive approach is proven to be more effective, Proactive risk 1371 analysis and response planning often maximize the value contribution of the projec. vidual is «3.11 Be Adaptable and Resilient Be adaptable and resilient. ‘= adaptability i the ability to respond to changing, conditions, © Reslionce ic the ability to absorb impacts and to recover {quick trom a setback or fale. © Flexibility helps teams remain adaptable and resilient. © A focus on outcomes rather than outputs facilitates adaptaby +375 Build adaptability and resilience ino the organizations and project team’s approaches 10 276 help the project accommodate change. recover rom setbacks. and advance the work of the 137 ae ‘ss Most projets encounter challenges or obstacles a some stage. The combined atributes of ‘200 adaptability and resilience in the team's approach to a project help to ensure that the 20 projet ean accommodate impacts and thrive, Adaptability efers tothe ability to respond “362 1 changing conditions. Resilience consists of two complementary tats: the ablity to 1283 absorb impacts and the ability to recover quickly from a setback or flue, Both +204 adaptability and resilience ae essential charactritics for anyone working on project ans delivery. {297 A projoot rarely proceeds exactly as planned, Projects ae influenced by internal and 308 external factors—new requirements, issues, and stakeholder influence, for example. Some ‘399 elements within a projet may flor fll short of expectation, requiring the ream ro 1200 regroup, rethink, nd replan, Onan infrastructure projec, for example, a court decision ‘0 during project execution could change designs and plans. In a tchnology project, a (22 computerized model of the technology might show thatthe components work together 8 propery, but the real-world application fil. kn bath eases, de project team fas ‘201 address the situation in order to move the projest forward. The view that projects should