Chapter 17: Communications Management

Aim: To understand the “Plan Communications” process.

Projects require the coordinated efforts of multiple team members in order to be a success. The success of the project is directly dependent on the quality of communication between team members. The communication plan addresses the necessary elements of team communication and leaves little room for assumptions. This plan is important to set the expectations of how the project team should communicate in an effective and timely manner. It also sets the expectations of the stakeholders and makes their need for information a part of the overall project plan. Most communication issues start with a lack of clear directives as to how and when to communicate.

More importantly, most people are reluctant to initiate unsolicited communication. The communication plan is crucial to good project team interaction. The plan actually tells team members what is expected of them throughout the project.

The table below shows the inputs, tools and techniques, and outputs for the plan communications process.

Plan Communications
Inputs	Tools & Techniques	Outputs
Stakeholder register Stakeholder management strategy Enterprise environmental factors Organizational process assets	Communication requirements analysis Communication technology Communication models Communication methods	Communications management plan Project document updates

Exam Watch:
The plan communications process addresses the information and communications needs of the stakeholders by determining the stakeholder information needs and defining an approach to meeting these needs. It deals with identifying who needs what information and how to supply that information to them. Without a proper communications plan, the chances of the project being a success are pretty slim.

You can learn more about Plan Project Communication process by Clicking Here

Prev: Chapter 16

Next: Chapter 18

Chapter 16: Human Resource Management

Aim: To understand the process “Develop Human Resource Plan”

The project manager must fulfill the role of manager and leader of the project team. The project manager has the following responsibilities:
• Determine the HR needs of the project
• Negotiate with line managers for internal resources
• Acquire external resources through the procurement process
• Determine training needs
• Identify/plan team-building activities
• Determine the performance review approach for a project’s human resources
• Determine the reward and recognition approach for motivational purposes
• Document the team structure and each team’s responsibilities
• Create a project organization chart
• Develop a staffing management plan

Exam Watch:
PMI puts a high value on the project manager’s responsibilities to the team. Make sure you are comfortable with applying PMBOK content to hypothetical situations.
Key Human Resource Principles

Human resource management is the set of processes used to organize and manage the project team, also referred to as the project staff. A subset of the project team is the project management team, composed of the project manager, project sponsor, and others responsible for project management activities such as planning, controlling, and closing the project.

Project human resource management is composed of human resource planning, acquiring, developing, and managing the team. HR planning has a number of key deliverables, including project organization charts, the staffing management plan, and determining the roles and responsibilities of each human resource.

The table below shows the inputs, tools and techniques, and outputs for the develop human resource plan process.

Develop Human Resource Plan
Inputs	Tools & Techniques	Outputs
Activity resource requirements Enterprise environmental factors Organizational process assets	Organization charts and position descriptions Networking Organizational theory	Human resource plan

It is important to understand the various methods organizations use to depict and describe human resources and their attributes. They are:
1. Organizational breakdown structure (OBS) – The OBS Graphically displays work packages according to departments. It can be used to identify the work assigned to each department
2. Resource breakdown structure – The RBS Graphically displays resources by type. It is very effective in tracking costs. Also, it groups resources even if they are working on different deliverables
3. Responsibility assignment matrix (RAM) – The RAM is a chart displaying resources and for which assignments they are responsible. It allows easy identification of all responsibilities for a given resource
4. RACI matrix – The RACI Matrix is a specific type of RAM that shows the resources that are responsible, accountable, consulted, and informed in project activities. It provides more detail than RAM
5. Position description – It is a text-based description of responsibilities. Provides a high level of detail for a given position

Note
An organizational breakdown structure (OBS) is a graphical representation of the project team arranged according to an organization’s existing structure. A resource breakdown structure is also a graphical representation but is organized according to resource type. A resource breakdown structure can contain resources other than human resources, such as equipment, and can be used to track costs as well.

In addition to graphical representations, resources might be documented in matrix-based documents such as a responsibility assignment (RACI) matrix.
These documents are effective communication tools to ensure team members understand for which assignments they are responsible.

Note: RACI stands for responsible, accountable, consult, inform.

The Staffing Management Plan

The staffing management plan is used to document the type of resources needed and the timing for those resources. The plan includes how the resources will be acquired, start and end dates, training requirements, policies and procedures for the team, and the team recognition approach and budget.

Exam Watch:
Resource leveling is a schedule network analysis that results in schedule changes, start and finish dates, based on resource constraints. That is, resource leveling might cause start and finish dates to change if multiple activities rely on over-committed resources.

You can learn more about the “Develop Human Resource Plan” process by Clicking Here

Prev: Chapter 15

Next: Chapter 17

Chapter 15: Quality Theories and PMI Quality Management Approach

The quality management approach presented in the PMBOK is intended to be compatible with other standards, including the International Organization for Standardization (ISO), Total Quality Management (TQM), Six Sigma, and others.

Exam questions on this topic are frequently taken from sources other than the PMBOK. The table below identifies some of the more popular quality theories.

Theory Name	Related Pioneers	Description
Continuous Improvement or Kaizen	Masaaki Imai, F.W. Taylor, and others	Processes are improved, mastered, and then further improvement is identified. Includes quality circles as a group-oriented means of developing ideas.
The Deming Cycle or Plan-Do-Check-Act	Dr. W. Edward Deming	Similar to Kaizen, an improvement is planned, completed, measured, and then further improvement acted upon.
Six Sigma	Based on statistical work by Joseph Juran	A statistical measure of quality equating to 3.4 defects per million items. If defects can be measured, a process can be put into place to eliminate them.
Total Quality Management (TQM)	Dr. W. Edward Deming	Fourteen points of management that call for awareness of quality in all processes.
Malcolm Baldrige Award	Howard Malcolm Baldrige	An award established by the U.S. Congress to promote quality awareness.
OPM3 (Organizational Project Management Maturity Model)	Project Management Institute (PMI)	Assess an organization’s project management maturity level against general best practices.
CMM (capability maturity model)	Software Engineering Institute (SEI)	Five levels of capability exist: initial, repeatable, defined, managed, and optimized.

The Plan-Do-Check-Act (PDCA) Cycle

PMI identifies the Plan-Do-Check-Act (PDCA) cycle, also referred to as the Deming Cycle, as both a quality tool and the underlying concept for interaction among project management processes. First, an improvement is planned. Next, the improvement is carried out and measured. The results are checked and finally acted upon. Acting upon the improvement might mean making the improvement a standard, further modification to the improvement, or abandoning the improvement.

Quality Approaches and Project Management

Quality approaches align with project management approaches in a number of areas, including achieving customer satisfaction, preventing defects instead of inspecting for them, management support for quality, and continuous improvement.
Some of the important things you need to know here are:
1. Customer Satisfaction - Customer requirements are met through a thorough understanding and management of expectations.
2. Prevention over inspection - It is cheaper to prevent defects than repair ones that are identified in inspections.
3. Management responsibility - Management must provide the support and resources for a quality program to be successful.
4. Continuous improvement - Processes are improved, mastered, and then further improvement is identified. Includes quality circles as a group-oriented means of developing ideas.

More details about these concepts can be found by Clicking Here

The Cost of Quality

The cost of quality (COQ) is a term that refers to the cost to produce a product or service that meets requirements. Part of the cost is rework when requirements aren’t met. An effective quality program reduces cost from rework.
The three primary types of cost associated with the cost of quality are
• Prevention costs
• Inspection costs
• Failure costs (internal and external)

Addressing prevention and inspection can be viewed as addressing the cost of conformance. This includes training, prototyping, design reviews, and testing. Failure costs (the cost of nonconformance) includes bug fixes, rework, cost of late delivery, and customer complaints.

Difference Between Quality Planning, Quality Assurance, Quality Control

One area of confusion, especially among project managers without a background in quality, is the difference between the three processes in quality management.
The main difference lies in the fact that:
a. Quality Planning is used in the Planning Phase
b. Quality Assurance is used in the Project Execution Phase and
c. Quality Control is used in the Monitoring & Controlling phase

Control Charts and Other Tools

You’ll see the term control chart mentioned in several areas of the PMBOK. A control chart is simply a graph that depicts upper and lower control limits, upper and lower specification limits, and actual performance data collected from project activities. Upper and lower specification limits correspond to the requirements from the project contract. The upper and lower control limits are placed at points at which action must be taken to avoid exceeding the specification limits. If performance data exceeds the upper control limit the project manager can implement appropriate changes to bring the quality back in line before the upper specification limit is exceeded and the project is in violation of the contract. The graph makes it easy to see when actual performance exceeds the predefined upper or lower limits.

Control charts are not the only tools at your disposal. As a project manager you also have access to quality planning tools such as
• Brainstorming - Generally an open forum that includes knowledgeable people in appropriate disciplines and encourages free expression of ideas.
• Affinity diagrams - Diagram to help identify logical groupings based on similar attributes.
• Force field analysis - Visual depictions of forces that favor and oppose change.
• Nominal group techniques - Small brainstorming groups where output is reviewed by a larger group.
• Matrix diagrams - Multiple groups of information presented to show relationships between factors, causes, and objectives. Each intersection of a row and column describes a relationship between items placed in the row and in the column.
• Prioritization matrices - Provides a method of ranking sets of problems by importance.

Prev: Chapter 14

Next: Chapter 16

Chapter 14: Quality Management

Aim: To understand the Plan Quality process

Although the project manager has overall responsibility for quality, the entire project team plays a role in quality management. Every member of the project team must understand the importance of contributions, accept ownership for problems, be committed to monitoring and improving performance, and be willing to openly discuss issues among team members. Although specific techniques and measures apply to the product being produced, the overall project quality management approach applies to any project and is relevant to the project as well as the product being produced.

Exam Watch:
Understand the difference between quality and grade. Quality is a measure of how well the characteristics match requirements. Grade is assigned based on the characteristics that a product or service might have. So a product might be of low grade, meaning it has limited features, but might still be acceptable. Low quality is never acceptable.

Also, you need to understand the difference between precision and accuracy. According to the PMBOK, “Precision means the values of repeated measurements are clustered and have little scatter. Accuracy means that the measured value is very close to the true value. Precise measurements are not necessarily accurate. A very accurate measurement is not necessarily precise.”

The Plan Quality Process:

The plan quality process has a number of key inputs, many of which originate from other initiating and planning processes. The table below shows the inputs, tools and techniques, and outputs for the plan quality process.

Plan Quality
Inputs	Tools & Techniques	Outputs
Scope baseline Stakeholder register Cost performance baseline Schedule baseline Risk register Enterprise environmental factors Organizational process assets	Cost-benefit analysis Cost of quality Control charts Benchmarking Design of experiments Statistical sampling Flowcharting Proprietary quality management methodologies Additional quality planning tools	Quality management plan Quality metrics Quality checklists Process improvement plan Project document updates

The plan quality process incorporates various quality concepts with which you should be familiar. The following list highlights important key concepts in PMI’s quality management:
• The cost of preventing mistakes is generally less than the cost of repairing them.
• In order to be successful, management support for the quality program must exist.
• Quality is tied closely to the scope-cost-time constraints; without quality these objectives cannot be met successfully.
• The cost of quality refers to the cost to implement a quality program.
• Understanding and managing customer expectations is important to a successful quality program.
• The quality program should emphasize continuous improvement.
• There is a close alignment between the quality approach and the overall project management approach on a project.

Exam Watch
PMI’s definition of quality: “The degree to which a set of inherent characteristics fulfill requirements.”

You can learn more about the Plan Quality process by Clicking Here

Prev: Chapter 13

Next: Chapter 15

Chapter 13: Project Cost Estimation

Aim: To understand the Cost Estimation and Budgeting part of Project Management. The processes we will cover in this chapter are:
• Estimate Costs &
• Determine Budget

Estimate Costs:

The estimate cost process associates an expected cost of performing work to each activity. Cost estimates can include labor, materials, equipment, and any other direct costs for project activities. Based on the activity resource and duration estimates, the cost estimates express the cost, normally in monetary amounts, of completing the work of the project. As with all project documents, the cost estimates can change through the project as conditions change. Different events can cause the cost for any activity to go up or down and require the cost estimates for the project to change. The project manager has to ensure that the cost estimates are kept up-to-date to reflect the correct figures at all times.

The table below shows the inputs, tools and techniques, and outputs for the estimate cost process.

Estimate Costs
Inputs	Tools & Techniques	Outputs
Scope baseline Project schedule Human resources plan Risk register Enterprise environmental factors Organizational process assets	Expert judgment Analogous estimating Parametric estimating Bottom-up estimating Three-point estimates Reserve analysis Cost of quality Project management estimating software Vendor bid analysis	Activity cost estimates Basis of estimates Project document updates

Cost estimates are compiled into the project budget. You probably recognize several estimating techniques from other processes. Three of the techniques used in the estimate costs process are the same basic techniques used in the estimate activity durations process. The other technique, bottom-up estimating, is also used in the estimate activity resources process. Although they are the same techniques, they are applied to different criteria.
• Analogous estimating - This uses actual cost values from similar activities. These activities can be from the same project or another project.
• Parametric estimating - This calculates cost estimates by multiplying the quantity of work or result of work. This type of estimate works best for standardized, and often repeated, activities. Ex: Laying a floor. Cost per tile + cost per hour of the workers pay can be used to arrive at the total cost of laying the floor.
• Three-point estimates - This uses three estimate values for each activity:

o Most likely - The cost most likely to occur
o Optimistic - The cost of the activity if everything goes as planned, or better
o Pessimistic - The cost of the activity in a worst-case scenario

• Bottom-up estimating - This technique calculates cost estimates by adding the costs of each individual work package. The technique starts at the most detailed level and rolls up the costs until a total cost for the project is obtained.

After you know the costs to accomplish the work of the project, you can create the project budget. The determine budget process aggregates the activity cost estimates into a single document for the project. The resulting project budget expands on the preliminary budget from the project charter and provides far more detail.

The table below shows the inputs, tools and techniques, and outputs for the determine budget process.

Determine Budget
Inputs	Tools & Techniques	Outputs
Activity cost estimates Basis of estimates Scope baseline Project schedule Resource calendars Contracts Organizational process assets	Cost aggregation Reserve analysis Expert judgment Historical relationships Funding limit reconciliation	Cost performance baseline Project funding requirements Project document updates

Exam Watch:
Don’t confuse the estimate costs process with the determine budget process. The determine budget process aggregates all of the activity cost estimates to result in a budget baseline against which your project costs will be measured.

You can learn more about the Estimate Cost & Determine Budgets processes by Clicking Here

Prev: Chapter 12

Next: Chapter 14

Chapter 12: Activity Planning – Creating the Project Schedule

Aim: To understand the processes that deal with the Project Schedule. Namely:
• Define Activities
• Sequence Activities
• Estimate Activity Resources
• Estimate Activity Durations
• Develop Schedule

Note: The processes above executed in the same order as they are listed above.

Any projects success depends on how well the activities were defined, sequenced and estimated. A good schedule is one that the team can comfortably stick to and work without slogging. The importance of proper planning cannot be emphasized enough.

Define Activities

The first process in the activity planning section is define activities. This process starts with the WBS and identifies the activities required to produce the various project deliverables. Activities are viewed from the perspective of the work packages. You ask the question, “What activities are required to satisfy this work package requirement?” Next, the resulting information from this process is used to organize the activities into a specific sequence.

The table below shows the inputs, tools and techniques, and outputs for the define activities process.

Define Activities
Inputs	Tools & Techniques	Outputs
Scope Baseline Enterprise Environmental Factors Organizational process assets	Decomposition Rolling wave planning Templates Expert judgment	Activity list Activity attributes Milestone list

Sometimes it is difficult to know everything about a project during the planning stage. It is common to learn more about the project as you work through the project life cycle. This is called progressive elaboration and affects the planning process. If you don’t know everything about the project, you can’t plan the whole project to the necessary level of detail.
For large projects, it is common to plan the entire project at a high level. The project starts with detailed plans in place for the work packages that are near the beginning of the project. As the time draws near to begin additional work, the more detailed, low-level plans for those work packages are added to the project plan. The planning process is revisited multiple times to ensure that the detailed plans contain the latest information known about the project. This practice is called rolling wave planning because the planning wave always moves to stay ahead of the work execution wave.

You can learn more about Defining Activities by Clicking Here

Sequence Activities

The next process is that of arranging the activities list from activity definition into a proper sequence. Some activities can be accomplished at any time throughout the project. Other activities depend on input from another activity or are constrained by time or resources. Any requirement that restricts the start or end time of an activity is a dependency. This process identifies all relationships between activities and notes restrictions imposed by these relationships.

For example, when building a car you cannot install the engine until the engine has been built and delivered to the main assembly line. This is just one example of how activities can be dependent on one another. The sequence activities process is one that can benefit from the use of computer software to assist in noting and keeping track of inter-activity dependencies.

The table below shows the inputs, tools and techniques, and outputs for the sequence activities process.

Sequence Activities
Inputs	Tools & Techniques	Outputs
Activity list Activity attributes Milestone list Project scope statement Organizational process assets	Precedence diagramming method (PDM) Dependency determination Applying leads and lags Schedule network templates	Project schedule network diagrams Project document updates

Network Diagrams

One of the more important topics to understand when planning project activities is creating network diagrams. Network diagrams provide a graphical view of activities and how they are related to one another. The PMP exam tests your ability to recognize and understand the most common type of network diagrams: the precedence diagramming method (PDM). Make sure you can read a PDM and use the information it presents.

Precedence Diagramming Method

The PDM shows nodes representing activities connected by arrows that represent dependencies. To represent that activity B is dependent on activity A (in other words, activity A must be complete before activity B starts), simply draw an arrow from A to B. PDM diagrams are also referred to as activity-on-node (AON) diagrams because the nodes contain the activity duration information. In fact, nodes generally contain several pieces of information, including

• Early start - The earliest date the activity can start
• Duration - The duration of the activity
• Early finish - The earliest date the activity can finish
• Late start - The latest date the activity can start
• Late finish - The latest date the activity can finish
• Slack - Difference between the early start and the late start dates

You can represent four types of dependencies with a PDM diagram:

• Finish-to-start (the most common dependency type) - The successor activity’s start depends on the completions of the successor activity.
• Finish-to-finish - The completion of the successor activity depends on the completion of the predecessor activity.
• Start-to-start - The start of the successor activity depends on the start of the predecessor activity.
• Start-to-finish - The completion of the successor activity depends on the start of the predecessor activity.

Exam Watch:
Carefully consider the different types of dependencies. Some can be confusing (especially start-to-finish). On the exam, you are asked to evaluate the scheduling affect of changes in start or end dates. The overall effect to the project depends on the type of relationship between activities. Don’t skip over the dependencies too quickly. Take the time to really read the question before you construct your diagrams.

You can learn more about the PDM and Sequencing Activities by Clicking Here

Estimating Activity Resources

Now you have a list of activities and their relative dependencies. The next process associates activities with the resources required to accomplish the work. This process lists each type and amount, or quantity, of each required resource. Every activity requires resources of some sort. Activity resources can include
• People
• Equipment
• Materials and supplies
• Money

The table below shows the inputs, tools and techniques, and outputs for the estimate activity resources process.

Estimate Activity Resources
Inputs	Tools & Techniques	Outputs
Activity list Activity attributes Resource calendars Enterprise environmental factors Organizational process assets	Expert judgment Alternatives analysis Published estimating data Bottom-up estimating Project management software	Activity resource requirements Resource breakdown structure Project document updates

One of the techniques you use when estimating activity resources is alternatives analysis. Analyzing the various alternatives provides an opportunity to consider other sources or ways to achieve the desired result for an activity. Alternatives might be more desirable than the initial expected approach due to cost savings, higher quality, or earlier completion. Another important outcome of alternative analysis is that in case the primary source becomes unavailable, you might have already identified a replacement method to complete the work. Suppose your main supplier of industrial fittings suffers a catastrophic fire. If your alternative analysis identified another source, you might be able to continue the project with minimal disruption.

The second item is bottom-up estimating. Recall that one of the purposes of creating the WBS is to decompose project work into work packages that are small enough to reliably estimate for duration and resource requirements. Using the WBS, you can provide estimates for mid- and high-level work by aggregating the estimates for the work packages that make up the desired work. Because this process starts at the lowest level of work (the work package) to create the estimate, it is called bottom-up estimating. This type of estimating tends to be fairly accurate because the estimates come from the people doing the actual work. The alternative is top-down estimating. Top-down estimates generally come from management or a source that is higher up than the people actually doing the work. The estimates are really educated guesses on the amount of resources required for a collection of work packages and tend to be less reliable than bottom-up estimates.

Exam Watch:
In practical scenarios, most project managers are forced to create a schedule where the customer or the sponsor decides the go-live date and the manager is left to scramble for resources to ensure that the project is completed by that time. PMI does not expect you to think this way during the PMP Exam. Think of the ideal scenario where you have enough time to do either bottom-up or at least a top-down estimate done by an expert.

You can learn more about the Estimate Activity Resources process by Clicking Here

Estimate Activity Durations

After the resource estimates are identified/calculated for each of the activities, it’s time to assign duration estimates i.e., the time required to complete each of the activities for whom the resources were estimated in the previous step. The estimate activity durations process approximates the number of work periods that are needed to complete scheduled activities. Each estimate assumes that the necessary resources are available to be applied to the work package when needed.

The table below shows the inputs, tools and techniques, and outputs for the activity duration estimating process.

Estimate Activity Durations
Inputs	Tools & Techniques	Outputs
Activity list Activity attributes Activity resource requirements Resource calendars Project scope statements Enterprise environmental factors Organizational process assets	Expert judgment Analogous estimating Parametric estimating Three-point estimates Reserve analysis	Activity duration estimates Project document updates

In addition to expert judgment and reserve analysis, three main techniques are used for project activity duration estimation. In many cases, using multiple techniques provides more accurate estimates. The three estimation techniques are
• Analogous estimating - This uses actual duration figures from similar activities. These activities can be from the same project or another project, but share similarities in budget, size, weight, complexity, or other parameters.
• Parametric estimating - This calculates duration estimates by multiplying the quantity of work by the productivity rate. This type of estimate works best for standardized, and often repetitive, activities.
• Three-point estimates - This uses three estimate values for each activity:

o Most likely (MT) -The duration most likely to occur.
o Optimistic (OT) -The duration of the activity based on analysis the best-case scenario.
o Pessimistic (PT) -The duration of the activity based on the worst-case scenario.

This approach originated with the Program Evaluation and Review Technique (PERT). PERT analysis calculates the Expected (ET) activity from the three-point estimates using the following formula:

ET = (OT + 4*MT + PT) / 6

You can learn more about the Estimate Activity Durations process by Clicking Here

Develop Schedule

The next step is to develop the actual project schedule. The develop schedule process pulls all of the activity information together and results in the project’s initial schedule. As work is iteratively planned and accomplished and the project moves through its life cycle, changes to the schedule are likely to occur. The schedule is a dynamic document and requires constant attention on the part of the project manager to ensure the project stays on track.

The table below shows the inputs, tools and techniques, and outputs for the develop schedule process.

Develop Schedule
Inputs	Tools & Techniques	Outputs
Activity list Activity attributes Project schedule network diagrams Activity resource requirements Resource calendars Activity duration estimates Project scope statement Enterprise environmental factors Organizational process assets	Schedule network analysis Critical path method Critical chain method Resource leveling What-if scenario analysis Applying leads and lags Schedule compression Scheduling tool	Project schedule Schedule baseline Schedule data Project document updates

Critical Path

An important topic to understand with respect to project schedules is the critical path. The critical path is the longest path from start to finish. It is calculated by adding all of the durations along each path from start to finish. The reason it is called the critical path is that any delay or increase in duration of any activity on the critical path causes a delay in the project. It is critical that all activities on this path be completed on schedule.

The critical path method performs a forward and backward pass through the schedule network, calculating the early start and finish dates and the late start and finish dates for all activities, based on durations and relationships. The critical path method does not take resource limitations into account. It is assumed that all resources required for the activities are available on time. The critical chain method does consider resource limitations. In short, the critical chain method uses the critical path method output and modifies the schedule network to account for limited resources.

Float

The main task of developing the project schedule is to relate each of the tasks and combine duration, resource requirements, and dependencies. You need to make several passes through the network diagram to calculate the values necessary to create a project schedule.

In general, you make two main passes through each path in your network diagram. The first pass starts with the initial project task. A task’s “early start date” is the earliest you can start working on that task. The “late start date” is the latest you can start working on the task. The difference between the early and late start dates is called float. The float is the schedule flexibility of a task.

Note: Make sure you follow every path from the starting task to the ending task, calculating duration of each path. There are likely several paths that will get you there. Sometimes the shortest duration path might not be immediately evident.

There could be more than one critical path. Remember that tasks on the critical path all have a float of 0, and any delay of a task on the critical path results in an overall project delay.

Allocating Resources

In addition to calculating the critical path and critical chain, it might be necessary to address resource limitations. The process of reallocating resources that have been over-allocated is called resource leveling. This technique seeks to avoid work stoppage due to limited resources being required by multiple activities. Remember that resource leveling can often change the critical path. Because resource allocation can change the critical path it is often useful to implement another technique: what-if scenarios. The what-if scenario allows the project planners to explore the effect to the critical path of resource availability changes. For example, if you depend on a particular person to complete work on the critical path, what happens if that person becomes sick or resigns from the company? Such a question would be part of a what-if scenario.

You can learn more about the Develop Schedule process, with examples for the Network Diagram analysis by Clicking Here

Prev: Chapter 11

Next: Chapter 13

Chapter 11: Project Scope Management as part of Project Planning

Aim: To understand the Processes those are part of the Project Scope Management area. They are:
• Collect Requirements
• Define Scope &
• Create Work Breakdown Structure

Scope management is the set of processes that ensures that the requirements of the customer are captured in a specification of work that ensures the delivery of the project’s deliverables, that all the project work is done, and that only the work required to complete the project is done. In other words, scope management makes sure that the project is completed without expending any unnecessary effort.

The collect requirements process seeks to use multiple tools and techniques to collect all of the project requirements from all of the stakeholders. This process attempts to leave no stone unturned and results in a complete list of project requirements. When properly performed, the collect requirements process dramatically reduces surprises as the project progresses toward completion.

The table below shows the inputs, tools and techniques, and outputs for the collect requirements process.

Collect Requirements
Inputs	Tools & Techniques	Outputs
Project charter Stakeholder Register	Interviews Focus groups Facilitated workshops Group creativity techniques Group decision-making techniques Questionnaires and surveys Observations Prototypes	Requirements documentation Requirements management plan Requirements traceability matrix

You can learn more about the Collect Requirements Process by Clicking Here

The next process, define scope, is the process that clearly states what the project will and will not accomplish. The supporting documents are reviewed to ensure the project will satisfy the stated goals and the resulting scope should state the stakeholders’ needs and clearly communicate the expectations for the performance of the project.

The table below shows the inputs, tools and techniques, and outputs for the scope planning process.

Define Project Scope
Inputs	Tools & Techniques	Outputs
Project charter Requirements documentation Organizational process assets	Expert judgment Product analysis Alternatives identification Facilitated workshops	Project scope statement Project document updates

You cal learn more about the Define Project Scope process by Clicking Here

Work Breakdown Structure

Many inexperienced project managers move too quickly from the scope statement to the activity sequencing processes. This practice is a mistake and often leads to activity omissions and inaccurate plans. PMI stresses the importance of creating a work breakdown structure (WBS) before moving to activity management processes.
The WBS provides the project manager and project team with the opportunity to decompose the high-level scope statement into much smaller, more manageable units of work, called work packages. The resulting WBS should provide a complete list of all work packages required to complete the project (and most importantly nothing more).

The table below shows the inputs, tools and techniques, and outputs for the create WBS process.

Create WBS
Inputs	Tools & Techniques	Outputs
Project charter Requirements documentation Organizational process assets	Decomposition	WBS WBS dictionary Scope Baseline Project document updates

In creating the WBS, the project team repeatedly decomposes the work of the project into smaller and smaller units of work, resulting in a collection of small work packages. The process continues until the resulting work packages are simple enough to reliably estimate duration and required resources. Don’t go overboard, though. When you have work packages that are manageable and represent a single work effort, stop the process. Each project is different, so this process results in different levels of detail for each project.

Exam Watch:
The term “work package” refers to an individual project activity. The work package is the lowest level WBS component. According to the PMBOK, “A work package can be individually scheduled, cost estimated, monitored, and controlled.”

The last main feature of the WBS is that it is organized in a hierarchical fashion. The highest level is the project. The children that represent project phases, divisions, or main deliverables are listed under the project. Each child process or task is divided into further levels of detail until the lowest level, the work package, is reached. Below is a sample WBS with multiple levels.

In addition to the WBS itself, another output of the create WBS process is the WBS dictionary. The WBS dictionary is a document that supports the WBS by providing detailed information for each work package. The WBS dictionary can contain many types of information, including
• Work package name or identifier
• Accounting code identifier
• Description of work
• Technical specifications
• Quality requirements
• Owner or responsible party assignment
• Required resources
• List of schedule milestones
• Associated schedule activities
• Cost estimates
• Acceptance criteria
• Contract information

You can learn more about the Create WBS process by Clicking Here

Prev: Chapter 10

Next: Chapter 12

Chapter 10: Project Integration Management in Project Planning Phase

Aim: To understand the Process that falls under Project Integration Management. i.e., “Develop the Project Management Plan”

The project management plan process covers all activities that identify and direct the actions of many other processes in the planning process group. Developing the project management plan includes coordinating the development of the subsidiary plans and incorporating them into the complete project plan. The main purpose of the project management plan is to define how the project is to progress from its beginning to completion.

In short, the project management plan provides the high-level game plan for how the project moves through its lifecycle. PMI defines many potential subsidiary plans that make up the overall project management plan. These subsidiary plans provide the specific details for managing each aspect of the project from initiation through closure. The subsidiary project management plans could include

• Project scope management plan
• Requirements management plan
• Schedule management plan
• Cost management plan
• Quality management plan
• Process improvement plan
• Human resource plan
• Communication management plan
• Risk management plan
• Procurement management plan

One of the more common mistakes inexperienced project managers make is to confuse a project plan with a project schedule. The output from many common project management software packages do not qualify as a project plan. They are a good start, but a true project plan is made up of much more information than just scheduling information. This process requires a focused effort to create a plan that incorporates all known information about a project.

The Table below shows the inputs, tools and techniques, and outputs for the develop project management plan process.

Develop Project Management Plan
Inputs	Tools & Techniques	Outputs
Project charter Outputs from planning processes Enterprise environmental factors Organizational process assets	Expert Judgment	Project Management Plan

Exam Watch:
You will see “expert judgment” listed as a tool and technique for several processes. The meaning of “expert judgment” is specific to each process. In the context of the develop the project management plan process, expert judgment includes
• Tailor the process to meet the project needs
• Develop technical and management details to be included in the project management plan
• Determine resources and skill levels needed to perform project work
• Define the level of configuration management to apply to the project
• Determine which project documents are subject to the formal change control process

You can learn more about the Develop Project Management Plan process by Clicking Here

Prev: Chapter 9

Next: Chapter 11

Chapter 9: Understanding PMI’s Planning Process Group

Aim – To provide an overview of the PMI’s Planning Process Group.

After you have completed the initiating processes you are ready to start planning your project. This means that you possess formal authorization to conduct the work of the project. But you won’t know what to do without a plan. Planning answers a few very important questions. What work will you do? What exactly are you trying to accomplish?
To answer these questions, start from what you know. There are three outputs from the initiating process group processes. Always start with the information necessary to proceed. Recall that PMI refers to this initial information for each process as the process’s inputs. The three outputs from the initiating processes are
• The project charter
• The stakeholder register
• The stakeholder management strategy

Armed with these initiating documents you can start the planning processes. In a nutshell, you follow each of the planning processes to refine the project documents from these outputs. As you develop the planning documents, always remember how the various processes are related.

Think of the initiating progress group as the processes that answer the ‘“what’” and ‘“why”’ questions. The planning processes answer the ‘“how”’ questions. The planning processes result in outputs that explain how the project will progress toward reaching its goals.

Exam Watch:
The Planning Process Group is by far the largest group and has many processes. So, be prepared to answer many questions in this area on the exam. After all, planning process group questions make up 23% of the PMP exam.

PMI is very explicit in stressing the importance of planning. Far too many projects suffer from the poor practice of starting work before anyone really knows what needs to be done. This almost always results in wasted effort and lost time. Proper planning requires good communication among the team and sound leadership from the project manager. The result of solid planning is a project team that is more informed and prepared to carry out the work required to meet the project’s goals. You should expect to see several questions on the exam that require you to understand the importance of fully planning before starting work.

Because planning is such a large process group, the subsequent chapters in this section wil cover the following topics:
• Integration
• Scope
• Schedule
• Cost
• Communications
• Risk
• Quality
• Procurement
• Human resources

The main purpose of planning is to provide a framework to gather information to produce a project management plan. In fact, the plan itself is really a collection of other plans. The majority of activities in the planning group center around developing the supporting documents that comprise the final project management plan. As more detailed information is learned about the project, the overall plan becomes more complete and the stakeholders’ confidence in the project increases.

Planning is an iterative group of processes as well. As the project progresses it often becomes necessary to modify the plan due to any number of reasons. Unexpected results, delays, outside factors, and internal factors can all require additional planning. Any scope changes are likely to require one or more planning processes to be revisited. Don’t assume that planning is only accomplished once. The exam requires that you understand how planning is iterative throughout a project.

Prev: Chapter 8

Next: Chapter 10

Chapter 8: What the Project Manager Needs to Know

Aim: To understand what you as a Project Manager need to know about the Project Initiation phase.

The project manager is responsible for all activity that takes place during the project lifecycle. In addition, the project manager is responsible for properly managing all of the resources associated with the project. These resources can include people, equipment, money, supplies, and even influence. An important aspect of project manager responsibilities is the ability to measure the effectiveness and impact of project decisions and compare various options. Project managers need to be able to assess the potential impact of various options and select the option that makes the most sense for the project and the organization. Let’s look at a general management approach and a few specific techniques to measure and assess decisions.

Using Management by Objectives

Many organizations use a common management technique called management by objectives (MBO). MBO is not covered directly in the PMBOK, but you need to understand its general concept for the PMP exam. In very simple terms, MBO helps ensure that objectives within various areas or levels within an organization agree, or harmonize, with objectives from other areas and levels. In short, MBO gets everyone thinking with an enterprise-wide perspective.

The initiating process group is really a set of activities that directly support MBO techniques. The main purpose of initiating a project is to ensure the project is understood, provides value to the organization, and is fully authorized by the organization.
MBO is closely related to solid project management practices for several reasons:

• MBO implements goal setting and recurring reviews and suggests activities similar to the project control process.
• MBO is concerned with ensuring that goals are consistent across an organization, and one task of the project charter is to state how the project supports an organization’s overall goals.
• Both MBO and sound project management work only if management supports them at a high level.

Implementing MBO is relatively simple. Here are the basic MBO process steps:

1. Establish clear and achievable objectives
2. Periodically check whether objectives are being met
3. Take corrective actions if any discrepancies are discovered

Accounting Concepts Used with Initiating Processes

It is important for project managers to have a good general understanding of the basic accounting principles that apply to their projects. Nearly all phases of the project life cycle require some type of accounting processes and valuation. Even initiating requires projects to be evaluated for the benefit to the organization.

We discussed the two general categories of project selection methods in the previous chapter. Both benefit measurement methods and constrained optimization methods require the application of some accounting methods.

For the PMP exam, you need to understand several cost accounting concepts that are frequently used when performing the project selection process. Of the two main project selection methods, the benefit measurement methods require more cost calculations. You are not expected to be an expert at cost methods for the PMP exam. However, you need to understand all these accounting concepts and know how to use them during the project selection activity.

The table below lists the main accounting concepts you need to know for the PMP exam and how they relate to project selection.

Project Selection Accounting Concepts
Accounting Concept	Description	Keys for Project Selection	Notes
Present value	The value today of future cash flow	The higher the Planned Value, the better.	Planned Value = FV/(1 + r)n
Net present value (NPV)	The present value of cash inflow less the present value of cash outflow	A negative NPV is unfavorable; the higher the NPV, the better.	Accounts for different project durations
Internal rate of return (IRR)	The interest rate that makes the net present value of all cash flow equal zero	The higher the IRR, the better.	The return that a company would earn if it invested in the project
Payback period	The number of time periods required until inflows equal, or exceed, costs	The lower the payback period, the better.	-
Benefit cost ratio (BCR)	A ratio describing the relationship between the cost and benefits of a proposed project	A BCR less than 1 is unfavorable; the higher the BCR, the better.	-
Opportunity cost	The difference in benefit received between a chosen project and a project that was not chosen	-	-
Sunk costs	Money that has already been spent and cannot be recovered	This should not be a factor in project decisions.	-

PMI also expects a project manager to understand other accounting concepts. The table below lists some of the most common accounting concepts you need to know for the PMP exam.

General Accounting Concepts
Accounting Concept	Description	Notes
Variable costs	Costs that change based on an organization’s activity	For example, fuel costs
Fixed costs	Costs that remain constant, regardless of activity level	For example, rent and lease payments
Direct costs	Costs that can be directly associated with the production of specific goods or services	For example, labor and material costs
Indirect costs	Costs that cannot be directly associated with the production of specific goods or services	For example, legal costs, administration, and insurance
Working capital	Total assets less total liabilities	-
Straight-line depreciation	A depreciation method that evenly divides the difference between an asset’s cost and its expected salvage value by the number of years it is expected to be in service
Accumulated depreciation	A depreciation method that allows greater deductions in the earlier years of the life of an asset	Related to: Double declining balance (DDB)
Life cycle costing	Includes costs from each phase of a project’s life cycle when total investment costs are calculated

Exam Watch:
These accounting principles represent one area of project management (and general management) a project manager must understand. There are several general management concepts on the PMP exam. Don’t worry much, because the basic concepts available above should be enough for the exam.

More details on the Project Selection Process can be found by Clicking Here

Prev: Chapter 7

Next: Chapter 9

Chapter 7: Project Communications Management as part of Project Initiation

Aim: To understand the Processes those are part of Project Communications Management in the Project Initiation Phase. i.e., “Identify Stakeholders”

The only other process in the initiating process group is the identify stakeholders process. Although you might have a preliminary list of interested parties during the development of the project charter, the official identification of stakeholders does not occur until after the project charter is complete. You are only prepared to identify all of the parties affected by the project after reviewing a complete project charter.

Identifying stakeholders is a crucial part of any project. As a project manager, you spend much of your time in the project communicating with stakeholders. It is important that you include every necessary stakeholder to the list and no one else. The identify stakeholders process results in an effective list of stakeholders and a description of how each one is involved in your project.

The table below lists the inputs, the tools and techniques, and the output for the identify stakeholders process.

Develop Project Charter
Inputs	Tools & Techniques	Outputs
Project charter Procurement documents Enterprise environmental factors Organizational process assets	Expert Judgment Stakeholder Analysis	Stakeholder Register Stakeholder Management Strategy

The most noteworthy point for the identify stakeholders process is the stakeholder analysis. This process is far more than just writing down a list of names. In addition to creating a list of stakeholders, you also need to know how much each stakeholder is involved in the project and how much influence each stakeholder can, and will, assert on the project.

Exam Watch:
Do not underestimate the importance of the stakeholder analysis. The exam might have a question that asks you to decide on a course of action that requires knowledge of stakeholder interest and influence. That information comes directly from the identify stakeholder process.

A stakeholder who is very interested in the project and has a lot of influence is apt to demand substantial attention. A stakeholder with little interest or influence should not require as much of your time. Though all stakeholders would need to be informed of the project status and progress, some might require more details than the other. The end user may need to know when the project will be available for use. The same information will be required for your project sponsor but along with this he may ask for resource utilization, budget utilization etc. The point here is that, not all stakeholders may need the same kind of information, even though they are all part of the big family of stakeholders of the project.

Prev: Chapter 6

Next: Chapter 8

Chapter 6: Project Integration Management as part of Project Initiation

Aim: To understand the Processes those are part of Project Integration Management in the Project Initiation Phase. i.e., “Develop Project Charter”

After a decision is made to initiate a project, the collection of input information begins. This is where the project boundaries can be a little unclear, but it is generally accepted that activities starting with the collection of inputs for initiating are part of the project. Remember that the project has not yet been authorized, so all resources required for the initiating processes must be funded explicitly by the project initiator. In other words, someone has to pay for the time spent by the people required to produce the project charter.
It is entirely possible that the organization decides not to pursue a project after it sees the project charter. The project charter might show that the project will not be worth the resource expenditures. In such a case, the resources already expended to produce the project charter have actually saved the organization from wasting many more resources. Therein lies part of the value of the initiating processes.

Exam Watch:
A project charter doesn't always result in a successful project initiation. Let us say, you are working for a Car Manufacturer and are assigned with a project to create a low cost, highly fuel efficient luxury car. The company has set a budget for each car and has also set a profit margin expected from each unit sold. Armed with this information, you perform the due diligence and figure out the fact that, you cannot manufacture such a luxury car under the set budgets & profit margins. Once you provide with your senior management with this information, they could do either of the below actions:
1. Drop the project as, this new car will not be profitable under the set circumstances. This effectively means that your project is scrapped and wont continue.
2. Assign extra budget for each car and adjust the profit margin accordingly. This effectively means that the project will continue.

The specific project management process that results in the project charter is the Develop Project Charter process.

The Inputs, Tools & Techniques and Output for this process are as follows:

Develop Project Charter
Inputs	Tools & Techniques	Outputs
Project statement of work Business Case Contract Enterprise environmental factors Organizational process assets	Expert Judgment	Project Charter

As you study for the PMP exam, don’t just memorize each of the inputs, tools and techniques, and outputs for each process. Really think about why PMI put them where they are. In the case of the develop project charter process, ask yourself what you need before you start. Each piece of information you need to start the process of creating the project charter is represented in the input section. You need some sort of document that specifies the need for the project (contract or statement of work). You also need to understand the policies and procedures governing projects for your organization. Once you have all the necessary information to start, you can start the process of developing the project charter.

During the project charter development, you use your own expert judgment as well as the expert judgment of subject matter experts in various areas to create the output or deliverable. Expert judgment involves using all of the project selection techniques in your project manager bag of tricks.
In the case of the project charter, the only output is the project charter itself. The main point to listing each of the inputs, tools and techniques, and outputs for each process is to understand each component of each process.

Because the development of the project charter is the first project activity, much of the work to produce the input for this process occurs either before the project initiation or within the scope of another project. Most of the input for this process serves to define the project and the environment in which it exists.

After the input information has been collected, the project initiator compiles and issues the project charter. The initiator must be someone who holds the authority to fund the project. Although it is desirable to assign a project manager early in the process, the project manager is not absolutely necessary to issue the project charter. It is important that the stakeholders have a material role in the creation of the project charter. The project manager, if one has been assigned at this point, can be the one to actually do the work of compiling the stakeholders’ needs, but the actual input for the project charter and the authority to issue it comes from the project initiator. The main reason so much emphasis is put on the project charter is that it provides the first and best opportunity for the stakeholders to really think through a project before the work begins, and it gives everyone a chance to consider the project before committing to it.

You can learn more about the “Develop Project Charter” Process by Clicking Here

Project Selection Methods

PMI encourages organizations to employ formal methods to select projects. Formal methods make it possible to compare multiple projects and select the one(s) that will produce the most benefit for an organization without being persuaded by emotional ties to certain projects. Additionally, organizations can set specific standards potential projects must meet to be accepted. There are two main selection method categories you need to know for the PMP exam. It is not important that you have an in-depth knowledge of these methods, but you need to be able to identify each type of method and understand their basic differences.

1. Benefit Measurement Methods
Benefit measurement methods document the relative benefits of completing each project. This approach enables organizations to compare projects by comparing their impact. Each specific method uses different measurements and results in different types of output. You don’t need to understand how to assess the relative measurements for the exam. Just know that these methods produce relative output an organization can use to compare projects.
2. Mathematical Models
Mathematical models analyze project description data to result in a more standardized set of output values. Simply put, a mathematical model can rate a project on a scale from 1 to 100. The organization then decides how desirable a single project is based on its rating. Usually projects with higher numbers are chosen over the ones with lower numbers. For ex: If your company is to produce two cars that have comparable production costs, the car that has the higher profit margin would be chosen for production.

Project Management Methodology

The organization’s standard practices when conducting project activities, along with the project management standards, make up the project management methodology. Any standards, guidelines, procedures, or common practices work together to form the general way of managing projects within any organization. The particular methodology you use depends on the culture of your organization, and all these factors affect the content of the project charter.

Project Management Information System

The project management information system (PMIS) is the collection of computerized tools used to collect, store, analyze, and interpret project information. Although most project managers use software to schedule projects, the PMIS often consists of far more than just project management software. When managing a project, learn which tools are available and use them to support the project throughout its life cycle.

Expert Judgment

The primary tool and technique referenced in creating the project charter is tapping into the expert judgment of others. Expert judgment of the project manager is included here if the project manager has been assigned. Some technical or procedural details might require input from an expert in a specific area. Such experts can be stakeholders or customers of the project, or they can be totally unrelated to the project. PMI encourages using any available source for project information input. When considering input sources for the project charter, or any needed expert input, consider any of these alternatives:
• Internal organization assets with specific expertise
• External consultants
• Stakeholders, including customers
• Professional or trade associations
• Industry or user groups

Prev: Chapter 5

Next: Chapter 7

Chapter 5: Initiating Process Group

Aim: To understand the Initiating Process Group

The initiating process group is the first step in the project life cycle. In fact, much of the work performed in this process group is actually outside the scope of the actual project being executed. The main purpose of initiating is to authorize a project to begin or continue. Notice that the initiating process group serves two potential roles. It generally occurs at the beginning of a project, but can also occur several more times throughout the life of a project. Some larger projects define specific milestones that require revisiting the initiating processes to continue the project. Invoking the initiating processes at the start of each phase helps keep the project focused on the business need the project was undertaken to address.

The Purpose of Initiating a Project

Initiating usually occurs at the beginning of a project and can also be required at certain points throughout the project. For example, a large project with the goal of producing a prototype of a commercial road car will likely encounter several points along the project life cycle at which important decisions must be made. After the engine and transmission have been produced and joined together, they must be tested to evaluate performance against project goals. If the performance does not meet certain standards, the components must be reworked to meet standards before continuing. Alternatively, the whole project could be terminated if the product is deemed to be unable to effectively meet the project standards. This phase in the project is a crucial go/no-go decision point and constitutes activities in the initiating process group.

Exam Watch:
Although the most common time for these activities to occur is at the beginning of a project, don’t overlook the fact that they can be taken up during the project at any point in time. It is not uncommon for large projects to call for initiating processes several times throughout the project life cycle. Any time you need to assess the progress of a project, reevaluate its merit, and request approval to continue, initiating processes are executed.

In all cases, initiating processes require input from preceding activities. The entities charged with deciding whether to proceed require substantiating information on which to base a decision. When initiating occurs at the beginning of a project, at least some of the input must be created in tasks that are not part of the project. This work predates the project initiation date and can make the actual project start point may seem incorrect. The points in time at which a project begins and ends are referred to as the project boundaries. Because a substantial amount of the inputs to the initiating processes is created outside the scope of the project, the starting boundary can be unclear. A project always starts as a result of a business need, and the business need develops before the project commences. Likewise, any documentation of the need for the project is developed before the actual project starts.

Exam Watch: You need to know the inputs and outputs of each process defined in the PMBOK. That’s 42 separate input and output sets! The exam includes several questions that require you to know process inputs, outputs, and general information flow. Memorizing them may seem like the easier option, but if you understand and rationalize what inputs are required for each process and what outputs it might generate, it would be easier to remember.

Subsequent initiating iterations during the project life cycle will use inputs from preceding activities. It is important to understand that the activities in the initiating process group always result in a critical project decision. The end of the initiating process group is represented by a decision to continue the project, go back and redo some of the work, or terminate the project altogether.

In most projects, you should include any customers and other stakeholders in many of the activities in the initiating process group. Including as many stakeholders as possible in the early project activities fosters a sense of pride and shared ownership of the project. Any stakeholder who feels a sense of ownership is apt to be more diligent about ensuring the project succeeds. Stakeholder participation increases the success of setting the project scope, gathering project requirements, and defining the overall criteria for project success.

The Project Manager Assignment

PMI requires that the project manager be assigned prior to any project planning taking place. Practically speaking the project manager doesn’t have to be assigned until the end of the initiating process group. However, it makes sense to assign the project manager earlier. A project manager who helped create the project charter is more comfortable with a project and has an easier time planning the project.

It is the responsibility of the project initiator, or project sponsor, to officially assign the project manager. After the project managers are assigned, the project charter identifies the project managers and provides them with the authority to carry out project management tasks.

The Project Charter and Its Purpose

The initiating process group consists of two processes. The first process is the development of the project charter, and the second process is identifying stakeholders. The project charter is the initial document that describes the project at a high level and formally authorizes the project. PMI requires that a project charter be created and accepted before a project is considered official for starting. As a PMP, you are required to insist on a project charter before proceeding in the role of project manager.

Exam Watch:
The PMBOK requires a project charter for every project. The lack of a project charter is a project stopper. Remember that you cannot start a project (As per PMI) without a project charter. Even though, there may have been or will be situations where you may be forced to do so, for the exam it is a No-Brainer and no project can start without the approved project charter.

Authorization from the project sponsor, the project management organization (PMO), or portfolio steering committee is necessary for the project manager to allocate resources and actually perform the work of the project. Even before bestowing authorization, the stakeholders must assign the project manager to the project. The project charter provides the framework for carrying out these actions. It is also the first deliverable of the project and sets the basement for the whole project to build on.

There is no standard format for a project charter, but each project charter should address these basic areas:
• Purpose or justification
• Project objectives
• High-level requirements
• Project description
• Risks
• Summary milestone schedule
• Summary budget
• Approval requirements
• Project manager
• Authorizing party

Note: Each area of the project charter provides information on the business need and how the project will meet the need. It is important to have a general understanding of the project charter contents for the exam. Although you aren’t asked specific questions about the project charter’s contents, you are asked questions about the project charter as a whole and its purpose.

Exam Watch:
The PMP exam asks a few questions about the roles of the project initiator, or sponsor, and the project manager. The project initiator starts the official project process. All of the project manager’s authority comes from the project initiator and the initial stakeholders. For this reason, the project charter must be issued by someone with the authority to fund the project and assign resources to it. The project initiator’s role is to describe and authorize the project, assign the project manager, and fund the project. The project manager’s role is to plan and execute the project.

Prev: Chapter 4

Next: Chapter 6

Chapter 4: Project Life Cycle

Aim: To Describe the Project Life Cycle

The project manager and project team have one shared goal: to carry out the work of the project for the purpose of meeting the project’s objectives. Every project has an inception, a period during which activities move the project toward completion, and a closure (either successful or unsuccessful). Taken together, these phases represent the path a project takes from the beginning to its end and is generally called the project life cycle.

The project life cycle is often formally divided into phases that describe common activities as the project matures. The activities near the beginning of a project look different from activities closer to the end of the project. Most projects share activity characteristics as the project moves through its life cycle. You might see several questions on the exam that ask you to compare different phases in a project’s life cycle. In general, here are the common comparisons of early and late project life cycle activities:

• The least is known about the project near its beginning. As the project matures, more is learned about the project and the product it produces. This process is called progressive elaboration. As you learn more about the project, all plans and projections become more accurate.
• The level of uncertainty and risk is the highest at the beginning of a project. As more is learned about the project and more of the project’s work is completed, uncertainty and risk decreases.
• Stakeholders assert the greatest influence on the outcome of a project at the beginning. After the project starts, the stakeholder influence continually declines. Their influence to affect the project’s outcome is lowest towards the end of the project.
• Costs and personnel activity are both low at the beginning of a project, are high near the middle of the project, and tend to taper off to a low level as the project nears completion.
• The cost associated with project changes is at its lowest point at the project’s beginning. No work has been done, so changing is easy. As more and more work is completed, the cost of making any changes rises.

One of the more important relationships to understand throughout the project life cycle is the relationship between project knowledge and risk. As stated earlier, knowledge of a project increases as more work is done due to progressive elaboration, and risk decreases as the project moves toward completion.

Another important relationship present in a project’s life cycle is the relationship between the declining influence of stakeholders on the outcome of a project and the cost of changes and error corrections. Because little or no work has been accomplished near the beginning of a project, changes require few adjustments and are generally low in cost.
At the same time, stakeholders can assert their authority and make changes to the project’s direction. As more work is accomplished, the impact and cost of changes increase and leave stakeholders with fewer and fewer viable options to affect the project’s product.

The image below summarizes these relationships:

Although all projects are unique, they do share common components or processes that are normally grouped together. Below are the generally accepted process groups defined in the PMBOK:
• Initiating
• Planning
• Executing
• Controlling
• Closing

Moving from one phase in the life cycle to another is generally accompanied by a transfer of technical material or control from one group to another. Most phases officially end when the work from one phase is accepted as sufficient to meet that phase’s objectives and is passed onto the next phase. The work from one phase could be documentation, plans, components necessary for a subsequent phase, or any work product that contributes to the project’s objectives.

You can learn more about the Project Lifecycle by Clicking Here

Who Are the Stakeholders?

A project exists to satisfy a need or requirement. Without a need of some sort, a project is not necessary. Needs originate with one or more people; someone has to state a need. As a result, a project fills the need and likely affects some people or organizations. All people and organizations that have an interest in the project or its outcome are called project stakeholders. The stakeholders provide input to the requirements of the project and the direction the project should take throughout its life cycle.

The list of stakeholders can be large and can change as the project progresses. One of the first requirements to properly manage a project is the creation of a key stakeholder list. Be very careful to include all key stakeholders. Many projects have been derailed due to the political fallout of excluding a key stakeholder. Every potential stakeholder cannot be included in all aspects of a project, so it is important to identify the stakeholders who represent all other stakeholders.

Although it sounds easy to create a list of stakeholders, the ground reality is far from easy. You often need to ask many questions about many people to ensure you create a complete stakeholder list. Because stakeholders provide input for the project requirements and mould the image of the project and its expectations, it is vitally important that you be as persistent as necessary to identify all potential stakeholders. The Key stakeholders for any project would include

• Project manager - The person responsible for managing the project.
• Customer or user - The person or organization that will receive and use the project’s product or service.
• Performing organization - The organization that performs the work of the project.
• Project team members - The members of the team who are directly involved in performing the work of the project.
• Project management team - Project team members who are directly involved in managing the project.
• Sponsor - The person or organization that provides the authority and financial resources for the project.
• Influencers - People or groups not directly related to the project’s product but with the ability to affect the project in a positive or negative way.
• Project management office (PMO) - If the PMO exists, it can be a stakeholder if it has responsibility for the project’s outcome.

You can learn more about the Project Stakeholders by Clicking Here

The Project Manager

One of the most visible & Obvious stakeholders is the project manager. The project manager is the person responsible for managing the project and is a key stakeholder. Although the project manager is the most visible stakeholder, he does not have the ultimate authority or responsibility for any project. Senior management, specifically the project sponsor, has the ultimate authority for the project. Senior management issues the project charter and is responsible for the project itself. The project manager is granted the authority by senior management to get the job done and to resolve any issues that might arise during the course of the project.

You can learn more about the Roles & Responsibilities of a Project Manager by Clicking Here

Exam Watch:
You must have a clear understanding of the project manager’s roles and responsibilities for this exam. If you have a pdf version of the PMBOK, search for the word “Project Manager,” and look at all the responsibilities defined. Know what a project manager must do, should do, and should not do.

Managing Project Constraints

Managing projects is a continual process of balancing the various competing project variables, or constraints. Historically, project managers have focused on the three most common constraints of scope, time, and cost. But in reality, there are more than just three constraints. Each of the project constraints are related and have an effect on the outcome of the project. The project manager must manage the competing constraints to successfully complete a project. Too much attention on one generally means one or more of the others suffer. A major concern of the project manager is to ensure each of these variables is balanced with the others at all times. The project constraints include, but are not limited to

• Scope - How much work is to be done? Increasing the scope causes more work to be done, and vice versa.
• Quality - What quality standards must the project fulfill? Higher quality standards often require more work, impacting other constraints.
• Schedule - The time required to complete the project. Modifying the schedule alters the start and end dates for tasks in the project and can alter the project’s overall end date.
• Budget - The cost required to accomplish the project’s objectives. Modifying the cost of the project generally has an impact on the scope, time, or quality of the project.
• Resources - Resources that are available to conduct the work of the project.
• Risk - Each decision made in the planning and execution of a project comes with risk. Riskier decisions might have consequences that affect other constraints.

Any change to one of the variables has some effect on one, or several, of the remaining variables. Likewise, a change to any of the variables has an impact on the overall outcome of the project. The key to understanding the project constraints is that they are all interrelated. For example, if you decrease the cost of your project, it is likely that you decrease the quality and perhaps even increase the risk. With less money, less work gets done. Or, you might find that it takes more time to produce the same result with less money. Either way, a change to cost affects other variables.

Even though this concept is fairly straightforward, a project manager must stay on top of each one to ensure they are balanced. In addition to managing the project constraints, the project manager also is responsible for explaining the need for balance to the stakeholders. All too often, stakeholders favor one constraint over another. You have to ensure that the stakeholders understand the need for balancing all constraints.

Project Management Process Groups

Work executed during the project can be expressed in specific groups of processes. Each project moves through each of the groups of processes, some more than once. These common collections of processes that the PMBOK defines are called process groups. Process groups serve to group processes in a project that represent related tasks and mark a project’s migration toward completion.

Remember that the five process groups defined by the PMBOK are
• Initiating - Defines the project objectives and grants authority to the project manager
• Planning - Refines the project objectives and scope and plans the steps necessary to meet the project’s objectives
• Executing - Puts the project plan into motion and performs the work of the project
• Monitoring and Controlling - Measures the performance of the executing activities and compares the results with the project plan
• Closing - Documents the formal acceptance of the project’s product and brings all aspects of the project to a close

Understanding Project Life Cycle and Project Management Processes Relationships

The PMBOK defines 42 project processes, grouped into five process groups. These processes define the path a project takes through its life cycle. The processes are not linear; some overlap with one another. In fact, some processes are iterative and are executed multiple times in a single project. It is important to become comfortable with the process flow and how it defines the project life cycle.

Throughout the life of a project, different processes are needed at different times. A project starts with little activity. As the project comes to life, more tasks are executed and more processes are active at the same time. This high level of activity increases until nearing the completion of the project (or project phase). As the end nears, activity starts to diminish until the termination point is reached.

Processes, Process Groups, and Knowledge Areas

The best way to prepare for questions that test your knowledge of the project management processes is to know and understand each of the processes, along with its process group and knowledge area assignment.

You can learn more about the Processes, Process Groups & Knowledge Areas by Clicking Here. The details are available in a table format that is easy to understand.

Understanding Process Interaction Customization

The five process groups defined in the PMBOK are general in nature and common to projects. However, all projects are unique and some do not require all 42 individual project processes. The processes defined in the PMBOK are there for use when needed. You should need the majority of the processes to properly manage a project, but in some cases you will not require each process.

Because projects differ from one another, a specific process can differ dramatically between projects. For example, the process of developing a communication plan is simple and straightforward for a small project with local team members. However, the process is much more involved and complicated if the team is large and located in several countries.
Understand the five process groups and 42 processes as defined in the PMBOK. But, more importantly, understand when and how to use each process. The exam focuses more on process implementation than process memorization. Be prepared to really think about which processes you need for a particular project.

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