Chapter Two: Project Management Knowledge Areas

2.1 Core Knowledge Areas

Cost Management
Time Management
Quality Management
Scope Management
2.2 Facilitating Knowledge Areas
Human Resource Management
Project Communications
Risk Management
Procurement Management
2.3 Cross-cutting Knowledge Area: Project Integration Management
Meaning of Knowledge areas
 Project management is a set of principles, practices, and techniques applied
to lead project teams and control project schedule, cost, and performance
risks to result in delighted customers.

 An identified area of project management defined by its knowledge

requirements and described in terms of its component processes,
practices, inputs, outputs, tools, and techniques.

 is a category of concepts and processes with a common goal.

 for example, All the things you need to know and do for successful
risk management are bundled under the Risk Management Knowledge
Area.
What are the project management Knowledge Areas?
 The 10 Knowledge Areas of project management are:
1. Integration Management
2. Scope Management
3. Schedule Management
4. Cost Management
5. Quality Management
6. Resource Management
7. Communications Management
8. Risk Management
9. Procurement Management
10. Stakeholder Management.
1. Cost Management
What is Cost and Project Cost Management?
 Cost is a resource sacrificed or foregone to achieve a specific
objective or something given up in exchange.
 Costs are usually measured in monetary units like dollars that
must be paid to acquire goods and services.
 Cost management is a process involved in the planning ,
estimation, budgeting and controlling cost so that activities can
be completed in estimated budget.
 Cost management is the process of effectively planning and
controlling the costs involved in a business.
 Project cost management includes the processes required to
ensure that the project is completed within an approved budget.
 Project Cost Management consists of resource planning, cost estimating, cost
budgeting, & cost control.
 “The processes involved in planning, estimating, budgeting, and controlling
costs so that the budget can be completed within the approved budget”
1. Planning cost management: determining the policies, procedures, and documentation
that will be used for planning, executing, and controlling project cost
2. Resource planning: determining what resources and quantities of them should be used
3. Estimating costs: developing an approximation or estimate of the costs of the resources
needed to complete a project.
4. Determining the budget: allocating the overall cost estimate to individual work items to
establish a baseline for measuring performance
5. Controlling costs: controlling changes to the project budget.
 Some of the advantages of cost management include:
1. The ability to predict a project's future expenses and costs
2. The maintenance of a central record of all predicted expenses
3. The ability to ensure that costs are approved before purchases
are made
4. The ability to control a project's expenses.
2. Time/schedule Management

 Project Time Management includes the processes required to ensure the

completion of the project within the time-frame which has been
allocated for it.
 Processes covered under Project Time Management are planning
schedule management, activity definition, sequencing activity,
estimating activity resources, activity duration estimating, schedule
development, and schedule control.
 It helps to ensure timely completion of the project.
 Project Schedule Management is all about making a detailed plan to tell
everyone WHEN the project will deliver what is in the requirements.
3. Quality Management

 Project Quality Management involves preparing a quality management plan

with metrics.

 Then you implement the plan,

 carrying out quality-related tasks and
 making course-corrections
 as necessary to keep your project delivering the outputs you expect.

 The project will satisfy the needs for which it was undertaken.
What is quality?
 Some central themes may be common to all to define quality could be:
1. Products: We define quality by our view of the features or attributes
of some particular product. This view can lead us with confidence to
the destructive “I’ll know it when I see it” definition of quality.

2. Defects: We expect quality products to be free of defects. Eg. No

cracks in a Building

3. Processes: What you do may keep a smile on your customer’s face,

but how you do it will keep you on schedule and on budget — and
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that may make the customer’s smile even brighter and longer lasting.
4. Customers — People who sell what they make may be very product focused in their
view of quality. They seek to make products that are superior to those of competitors
and always strive to be the best: “This is the best DVD player on the market today.”
I,e, quality is defined by customers, their needs, and their expectations.

5. Systems — A system is a group of things that work together. At higher level of

analysis, quality may be viewed as arising from things that work together. Products,
defects, processes, and customers are all part of a system that generates quality, as are
suppliers, policies, organizations, and perhaps some other things unique to a specific
situation.
`
Definition of Quality?: But what does "quality" really mean?

 • Quality 
“1. a characteristic or attribute of something: a property.
2. the natural or essential character of something.
3. excellence, superiority.
4. a degree or grade of excellence.” according to Webster.

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 Quality

Quality is “fitness for use: ensuring a product can

be used as it was intended”
(Joseph Juran)
Quality is “conformance to requirements: meeting
written specifications
(Philip B. Crosby)
Quality of a product or services is its ability to satisfy
the needs and expectations of the customer

Quality is a Journey, not a Destination

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Definition of Quality?: But what does "quality" really mean?

 At its most basic level, quality means meeting the needs of customers. This is

also known as "fit for use."
 As per Joseph Juran, Quality has two meanings:
1. Features of products which meet customer needs and thereby provide customer
satisfaction.”
 Quality improvement related to features usually costs more.
2. Quality also means “freedom from deficiencies.” These deficiencies are errors that
require rework (doing something over again) or result in failures after a product has
been delivered to a customer. Such failures may result in claims, customer
dissatisfaction, or terrible consequences to the user. Quality improvement related to
deficiencies usually costs less.
Juran’s view considers products, defects, and customers.
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Quality Management for Projects
Quality management is the process for ensuring that all project activities
necessary to design, plan and implement a project are effective and efficient
with respect to the purpose of the objective and its performance.
Project quality management (QM) is not a separate, independent process that
occurs at the end of an activity to measure the level of quality of the output.
It
is not purchasing the most expensive material or services available on the
market.
 Quality and grade are not the same,
grade are characteristics of a material or service such as additional features.
A product may be of good quality (no defects) and be of low grade (few or
no extra features).
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 Project Quality Management includes
 the processes and activities of the performing organization
 that determine quality policies, objectives, and
responsibilities
 so that the project will satisfy the NEEDS(time, cost, and
scope, product, customer)for which it was undertaken.

 Project quality management includes the process required to ensure

that the project satisfies the needs for which it is undertaken.

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 Project Quality Management uses policies and procedures to implement,
within the project’s context, the organization’s quality management
system and, as appropriate, it supports continuous process improvement
activities as undertaken on behalf of the performing organization.

 Project Quality Management works to ensure that the project

REQUIREMENTS, including product requirements, are met and
validated.

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 PQM includes all the activities of the overall management
function that determine
 the quality policy,
objectives, and responsibilities and
 implement them within the quality system.

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 Key Processes of Project Quality Management

 Project Quality Management has the following key processes/activities

or steps that you should perform in your projects...
1. Quality Plan
2. Quality Assurance
3. Quality Control
4. Quality Improvements

Managing quality: translating the quality management plan into

executable quality activities
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 Key Processes of Project Quality Management
1. Plan Quality
 Plan Quality involves identifying the quality requirements for both the project and the
product and documenting how the project can show it is meeting the quality requirements.

 The PMBOK® Guide defines quality planning as :…identifying which quality standards are
relevant to the project and determining how to satisfy them; a metric is a standard of
measurement

 The outputs of this process include:

 A Quality Management Plan,
 quality metrics,
 quality checklists and
 a Process Improvement Plan.
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2. Quality Assurance
 Quality assurance includes all the activities related to
satisfying the relevant quality standards for a project.
 Quality Assurance is used to verify that the project
processes are sufficient so that if they are being adhered
to the project deliverables will be of good quality.
 Quality assurance evaluating overall project performance
on a regular basis to provide confidence that the project
will satisfy the relevant quality standards.
 Quality assurance evaluating overall project performance
to ensure the project will satisfy the relevant quality
standards
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3. Perform Quality Control
Quality Control is the monitoring of specific project results to determine if
they comply with the relevant quality standards and identifying ways to
eliminate causes of unsatisfactory performance. to improve overall quality.

 Quality Control verifies that the product meets the quality requirements.

 The results will determine if corrective action is needed.

 The main outputs of quality control are:

1. Acceptance decisions
2. Rework
3. Process adjustments

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4. QUALITY IMPROVEMENT
 It is the systematic approach to the processes of work that looks to remove
waste, loss, rework, frustration, etc. in order to make the processes of work
more effective, efficient, and appropriate.

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4. Project Scope Management
Project Scope Management includes the processes required to ensure that the
project includes all – and only the – work needed for its successful completion.
In other words, scope management asks what is included in the project.

Completion of the project scope is measured against the project management plan
where the requirements and specifications of the project output are given.

Processes covered under Project Scope Management are:

 Plan scope management,
 Collect requirements,
 Scope definition,
 Creation of the work breakdown structure,
 Scope verification and
 Scope control.
5. Project Human Resource/Stakeholder Management

In this KA you:
 Identify the people involved and affected by the project — the stakeholders
 Plan how you are going to engage them in your work: create a stakeholder
engagement plan.

 Manage the activities you are going to use to engage them, and gather
feedback on whether the activities were successful or not.

 Act on the feedback to improve your stakeholder engagement work for next
time.
 Project Human Resource Management includes the processes needed to organize
and manage the project team.

 Human resources are considered an organization’s “most important asset” and the
same applies to projects.

 The processes required to make the most effective use of the people involved
with the project.

 Processes covered under Project Human Resource Management are:

 Human resource planning,
 Project team acquisition,
 Project team development, and
 Project team management.
6. Project Communications Management
 Project Communications Management includes the processes needed to
ensure timely and appropriate generation, collection, dissemination,
storage, and ultimate disposition of project information.
 Considered the “life-blood” of a project, communication is often a
challenging undertaking and difficulties in (or a total breakdown of)
communication can severely impede a project.
 It
consists of communications planning, Processes covered under Project
Communication Management:
 Communications planning,
 Information distribution,
 Performance reporting &
 Administrative closure.
7. Project Risk Management

What is a Risk?
 A risk is an uncertain event that could have a positive or
negative effect on your project

 * This means there is a probability between 1-99% that the

event could occur

 If there is a 0% chance of an event occurring, there is no risk

 (example; there is a 0% chance your project will be
adequately funded, this is not a risk, it is a reality).
What is a Risk?

 If there is a 100% chance of an event occurring, this would

be an issue, not a risk

 Risks with negative consequences are called threats

 Risks with positive consequences are called opportunities

(Yes, risk can be good! Stop thinking of risk as bad, and
start thinking of it in terms of probabilities!)
Types of Risk
Risks can be broken out into two primary types

1. Pure Risk (hazard)– risk with potential loss only

 ex. Fire, theft, personal injury

2. Business Risk (speculative risk) – risk with

potential loss or gain
 ex.A highly skilled employee becomes available to
work on your project, reducing your schedule time,
the tax rate changes, a new server costs less (or
more) than you budgeted for!
Terms & concepts
 Uncertainty: a lack of knowledge about an event that reduces
confidence
 Risk averse: someone who does not want to take risks.
 Risk Prone – Someone who is willing to take big risk
 Risk tolerances: area of risk that are acceptable /
unacceptable.
 Risk thresholds: the point at which a risk become unacceptable
 Risk Areas: Project Constraints (scope, time, cost, etc)
Risk Factors

1. The probability the risk will occur

2. The range of possible outcomes (impact)
3. When in the project lifecycle the risk is likely to occur (the
timing);
• once the expected timeframe of the risk has passed and it is no
longer a risk, it can be removed from the risk list
4. How often the risk is expected to occur on the project
(frequency)
Project Risk Management includes the processes needed to manage the risks on the
project with a view to reducing the likelihood of a negative impact on attainment of the
project goal, the project cost and time, and the project stakeholders.

Processes covered under Project Risk Management are

 Risk management planning,
 risk identification,
 qualitative risk analysis,
 quantitative risk analysis,
 risk response planning, and
 risk control.
Risk Management Processes

 Risk Planning – this is how you plan on conducting risk

management. You wouldn’t start managing your project without
a plan, so why would you approach risk management that way?
 Identify Risks – this is the phase where you attempt to identify
most of your risks
 Qualitative analysis – this is a subjective analysis of your risks
that produces a risk ranking, usually in the order of high,
medium, low, or on an ordinal scale. Rankings are by agreement
of your project team, sponsors and key stakeholders
Risk Management Processes

 Quantitative Analysis – a numerical analysis of the

probability and impact of the risk on your project

 Plan Risk Response– a course of action you will take to

deal with your risks should they go from risk to issue

 Monitor & Control Risks – monitoring your lists.

8. Procurement Management

 Project Procurement Management includes the processes for acquiring or purchasing

the materials, products, goods and services which are needed to perform the
project work to attain project scope from outside the performing organization.
 Project Procurement Management includes the contract management and change
control processes required to administer contracts or purchase orders issued by the
project team.
 Processes covered under Project Procurement Management are:
 procurement planning,
 solicitation,
 source selection,
 contract administration &
 contract closeout.
9. Project Integration Management
 Project Integration Management includes the processes which are needed to identify,
define, combine, unify and coordinate the various project management processes in
the project process groups (e.g. development of the project charter, development of
project management plan, directing and managing project execution, monitoring and
controlling project work, integrated change control and project closure).
 Integration is crucial for project completion, meeting stakeholder expectations and
needs, making choices where to concentrate resources over time, dealing with issues
and coordinating project activities.
 The point of this whole Knowledge Area is to make it clear that everything about
project management overlaps and needs to be managed as a holistic whole.
 In other words, you can’t ‘do’ schedule management and ignore what the impacts of
that might be on people, risk, communications, cost and the rest. This is the domain
where you have to manage interdependencies between pretty much everything on the
project.
10. Resource Management
 Project Resource Management is so important! It’s the domain where you work
out what you need to get the project done.

 Resources are typically people but could also be other things like:
Equipment or vehicles
IT hardware and software
Materials like sand, gravel or other components
Facilities e.g. an office you have to rent for the duration of the project
Office gadgets like projectors.
Money.

This Knowledge Area covers

planning how you are going to do resource management,
estimating what resources you need,
 acquiring the resources you need,
ensuring the physical resources you’re using are available as necessary.
 track the utilization of resources and take corrective action if necessary — for
example if you’re getting through your resources at a quicker-than-planned rate.