Ebook On PMBOK 4th Edition

PMAC
PMAC Consulting Private Limited

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Global R.E.P. PMI, USA
presents presents presents presents
ADVANCED PROJECT MANAGEMENT COURSE
IN CONFORMANCE WITH LATEST PMI STANDARDS
PMBOK GUIDE-2008, FOURTH EDITION
GOOD MORNING FOLKS!
Welcome
to
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the world
of
Project Management
Latest PMI Standards
LATEST PMI STANDARDS!
A guide to the Project Management
Body of Knowledge (PMBOK
3
Body of Knowledge (PMBOK
Guide) is a recognized standard for
the project management profession
worldwide!
The PMBOK Guide provides Knowledge,
Processes, Skills, Tool and Techniques that are
generally recognized good practice.
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generally recognized good practice.
Their application enhances the chances of
success over a wide variety of projects.
But, all the processes may not apply uniformly
to all projects. Hence, it is the RESPONSIBILITY of
your organization and/or the project management
team to determine what is appropriate for any
given project. This is called TAILORING!
In addition to taking advantage of the
PMBOK Guide for the success of your
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PMBOK Guide for the success of your
projects, PMI also requires the practitioners
to demonstrate a commitment to ethical and
professional conduct.
Project Management Institute Code of
Ethics and Professional Conduct.
Purpose of this Course
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To provide a proven, holistic approach to the
professional of Project Management. An
approach that has been globally recognized to
enhance chances of success over a wide range
of projects.
Education Agenda
LEARNING OBJECTIVES
Upon completion of this course, the students will:
1. Comprehend entire gamut of concepts, tools and
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1. Comprehend entire gamut of concepts, tools and
techniques, and terminology relating to the profession
of Project Management in conformance with per PMI
standards.
2. Master identification of project needs, creation of WBS
and how to plan to avoid scope creep, time and cost
overruns, or quality problems later in the project.
Education Agenda
LEARNING OBJECTIVES
3. Command the art of estimating project costs and
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3. Command the art of estimating project costs and
schedules using simple and proven techniques.
4. Attain expertise on meeting triple constraints,
assessing and dealing with risks, and establishing a
dependable project control and monitoring system.
Education Agenda
LEARNING OBJECTIVES
5. Achieve proficiency in vendor management and project
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5. Achieve proficiency in vendor management and project
closure.
6. Acquire knowledge and ability to pass PMP
examination.
Education Agenda
WARMING UP WITH
A PROJECT FORETHOUGHT!
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A PROJECT FORETHOUGHT!
Project forethought
Do you have a vision?
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Do you have a vision?
Your personal vision
Your functional areas vision
Your organizations vision
Project forethought
How do you articulate it in the
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How do you articulate it in the
backdrop of todays
realities?
Project forethought
Backdrop of todays realities?
Over capacity of production facilities
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Over capacity of production facilities
Sharp increases in the cost of material, energy, and
labor
Changing customer values and more exacting quality
requirements
Increased competition among companies in saturated
and dwindling markets
Environmental problems
Project forethought
Backdrop of todays realities?
A need to introduce new products more rapidly
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A need to introduce new products more rapidly
A need to lower breakeven point
Globalization of markets
Social problems, economic problems, political problems
Project forethought
How can your organization balance the need for radical
Questions to help you articulate your vision?
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What will be the new management model for tomorrow,
and how it will be different from todays?
How can your organization balance the need for radical
change with strategic continuity?
What role must managers play in the post hierarchical
organization of future?
Project forethought
How can strategic thinking about the future be embedded
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How can strategic thinking about the future be embedded
within the organization?
Whom should your organization involve in the process of
developing and implementing strategy?
Project forethought
How can a radically-decentralized organization be
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How can a radically-decentralized organization be
created and sustained?
As corporations and their networks become increasingly
complex, how can they be controlled?
Project forethought
How can organizations shift from spreading
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How can organizations shift from spreading
information around to building knowledge?
How to discover better technologies
to increase quality of human life on earth?
Project forethought
Articulating your vision
You can now choose with an end in mind
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It should be worthy of pursuance
Challenging and achievable
To make it happen, take up its realization as a
PROJECT
Project forethought
Articulating your vision
You can now choose with an end in mind
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It should be worthy of pursuance
Challenging and achievable
To make it happen, take up its realization as a
PROJECT
Project forethought
How to train and ensure competency of people to work
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How to train and ensure competency of people to work
together to achieve common goals?
How to make coming generation better equipped to
succeed in life?
Project forethought
Realizing vision
Needs and aspirations of people
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Needs and aspirations of people
are the reasons for organized effort
in society.
Projects have been taken up since
earliest civilizations to fulfill them.
Project forethought
Projects make it possible
Products
Services
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Needs
Aspirations
Visions
Strategies
Projects
Services
Infrastructure
Monuments
Space research
War victories
Entertainment
Media
Earnings
Growth
Etc.
Operations provide us benefits of the
product of the project on ongoing basis
Fundamental
PMBasics
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Fundamental
Concepts
We begin our discussion on fundamental
concepts under three broad headings:
PMBasics: Fundamental Concepts
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1. Project Management Framework
2. Project Life Cycle and Organization
3. Project Management Processes
PM Basics: Fundamental Concepts
PROJECT MANAGEMENT FRAMEWORK
What is a project?
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Projects vs. Operations!
Projects and Strategic Planning!
What is Project Management?
What is a Program?
What is a Portfolio?
PM Basics: Fundamental Concepts
PROJECT MANAGEMENT FRAMEWORK
Relationships among Project Management,
Program Management, and Portfolio
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Program Management, and Portfolio
Management!
What is a PMO?
Role of a Project Manager!
PMBOK Guide!
Enterprise Environmental Factors!
PM Basics
A Project is A TEMPORARY ENDEAVOR
What is a project?
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A Project is A TEMPORARY ENDEAVOR
undertaken to create A UNIQUE PRODUCT,
SERVICE, OR RESULT!
Lets understand the definition
PM Basics
- What do we mean by the word
TEMPORARY?
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- What do we mean by the words A UNIQUE
PRODUCT, SERVICE, OR RESULT!
- We would also discuss on a very
important terms called Progressive
Elaboration!
Lets understand the definition
Temporary means:
PM Basics: Understanding Project Characteristics
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Temporary means:
- Definite beginning
- Definite end
- With defined project objectives
(scope, time, cost, and quality)
Project end IS REACHED when:
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Project end IS REACHED when:
1) Its objectives are met, or
2) It becomes clear that the project objectives
will or can not be met, or
3) The need for the project no longer exists.
Temporary does not
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Temporary does not
necessarily mean
Short in duration!
Projects can last for several years!!
Government of Indias E-governance project is
A multi-year project.
All that temporary means is that
project duration is finite, not ongoing.
Temporary does not mean
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The product of the project will also be temporary.
Most projects are done to produce products,
service or result that is long lasting.
Examples
a bridge, a dam,
a building, a monument, a park
Temporary nature
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Temporary nature
Some projects produce a product or service for a
particular occasion.
Examples: Olympics, Fashion show, Grammy awards
Certain others cater to an opportunity or
market window that is short in duration
Examples: Sale Campaigns for Christmas, Diwali, Pongal, IId, etc
PROJECT TEAMS ARE FORMED AS IT BEGINS AND
DISBANDED AS IT COMPLETES
Unique product, service, or result
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Unique product, service, or result
Projects involve creating a product, service,
or result that has not been done exactly the
same way before EVEN IF YOU HAVE BEEN
DOING SAME CATEGORY OF PROJECTS
MANY TIMES OVER!
Different CLIENTS, REQUIREMENTS, LOCATIONS,
etc.
A project can create:
1. A product (component of another item or end
PM Basics: Comprehending Project
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1. A product (component of another item or end
item).
2. A service (a business function to support
production or logistics).
3. A result (an outcome or document, such as
R&D project develops Knowledge,
Market Survey).
Progressive elaboration
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is critical to project success
Progressive means proceeding in steps,
continuing steadily with increment.
Elaboration means worked out with care
and detail, developed thoroughly
WHY Progressive elaboration?
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WHY Progressive elaboration?
Because projects are temporary and unique!
Example: Project scope is high-level in the beginning. It
becomes more detailed as project team
progresses and develops better understanding
of project objectives and deliverables.
Many people confuse it with scope creep that happens
due to poor scope definition, poor WBS formation and
Uncontrolled changes.
Each projects product is unique.
Hence, its characteristics
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Hence, its characteristics
THAT DISTINGUISH IT
must be
PROGRESSIVELY ELABORATED!
Thats why so much emphasis on processes called:
- Identify stakeholders (during initiation)
- Collect requirements (during planning)
Progressive elaboration
is critical to project success!
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The distinguishing characteristics
Broadly defined early in the project
More explicit and detailed as project
progresses
THEN, PROJECT TEAM BEGINS TO GRASP THEM
BETTER
PRODUCT SCOPE
Product Scope and Project Scope
PROJECT SCOPE
PM Basics: Progressively elaborated
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Functions and
features characterizing
the product or service.
COMPLETION
Measured against
product requirements
The work required to
be performed to deliver
a product bearing
specified functions and
features.
COMPLETION
Measured against
project management
plan
Sample
Progressive
Elaboration
ABC CARGO
LOGON PROJECT
BASIC
DESIGN (H)
HARDWARE FABRICATION
SITE
OPERATIONS
Project
Management
PURCHASE
SOFTWARE
SPECS (L)
L 0
L 1
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DESIGN (H) OPERATIONS Management
DESIGN
(J)
DRAWINGS
(K)
PART B
DRAWINGS
(P)
FINAL
INSTALLATION
(Y)
TEST
(Z)
SOFTWARE
PART A
DESIGN
(I)
DRAWINGS
(O)
SPECS (L)
ASSEMBLY
(U)
PART A
TEST
(W)
ASSEMBLY
(V)
TEST
(X)
PART B
PURCHASE
(N)
DELIVERY
(S)
PURCHASE
(M)
DELIVERY
(R)
PURCHASE
(Q)
DELIVERY
(T)
WORK
PAKCAGES
(H)
through
(Z)
L 2
L 3
PM Basics
Projects Vs. Operations
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Projects Vs. Operations
What do organizations do?
PM Basics: Projects vs. Operational Work
1.
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ORGANIZATIONS
PERFORM WORK
to accomplish
a set of defined objectives
1.
Work can be categorized as
2.
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Work can be categorized as
either
PROJECTS OPERATIONS or
Sometimes they overlap!
What is common to projects and operations?
3.
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Performed by people
Limited by Constraints, including
resource constraint
Planned, executed, monitored and controlled
Performed to achieve organizational objectives
Or strategic plans
Projects are temporary
PROJECTS OPERATIONS
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Operations are ongoing
and repetitive.
The purpose of an
ongoing operation is to
sustain the business.
Operations adopt new
set of objectives and the
work continues.
Projects are temporary
and unique.
The purpose of a project
is to attain its objective
and then terminate.
The project concludes
when its specified
objectives have been
achieved.
PM Basics
Remember:
1. Operations produce same product until the product
becomes obsolete.
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becomes obsolete.
2. Within the life cycle of a product, projects can intersect
with operations at various points:
a) During improving productivity/process,
b) Developing new product or upgrading a product
c) Expanding outputs
d) At each closeout phase or until divestment of the
product, there can be many projects!
PM Basics
Remember:
3. At each point, deliverables and knowledge are
transferred between projects and operations. Why?
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transferred between projects and operations. Why?
Answer: For implementation of the delivered work!
4. How it happens?
Answer: It happens in two way!
a) Transfer of project resources to operations
toward the end of the project.
b) Transfer of operational resources to the project
at the start.
Operation examples
Manufacturing operations
PM Basics: Comprehending Project Examples
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Manufacturing operations
Production operations
Usage of the product of a project, such
as a software application, or using
network infrastructure
Accounting operations
Project examples
Developing a new product or service
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Developing a new product or service
Starting a new business, or expansion of the
existing one
Installing a new facility/ infrastructure
Increasing productivity
Increasing market share
Increasing profitability
Project examples
Cost reduction (operation and maintenance)
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Cost reduction (operation and maintenance)
R & D projects
Technology up-gradation/ new technology
projects
Pharmaceutical projects
Organizational Change management projects
(work environment, performance management,
organization structure, training, etc.)
Projects and Strategic Planning
PM Basics: Projects and Strategic Planning
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Projects and Strategic Planning
Projects are are a means to achieve
Strategic Plan of an organization!
PM Basics: Projects implement strategy
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One or more of the following Strategic
Considerations give rise to projects:
1) Market demand
2) Customer request
3) Strategic opportunity/Business Need
4) Technological advance
5) Legal requirements
PM Basics: Projects implement strategy
Hence, Projects (within programs or
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portfolios) are a means by which we
achieve organizational goals and
objectives within the context of strategic
plan!
Projects
are
PM Basics: Projects encompass entire organization
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are
-Taken up at all organizational levels
- May require few persons to thousands
- May be undertaken within an organization or
involve many outside organizations
YET
Worldwide concern
PM Basics: Hey! Its important
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YET
It is concerning to note
that
only about 34% of all the projects
undertaken globally
SUCCEED!
Worldwide concern
This only means that the concept
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of
Managing Projects Effectively
is
poorly understood.
Addressing the concern
To master
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To master
the concepts, tools, and techniques
for
Managing Projects Successfully
lets first
understand the genesis of PROJECTS!
What
PM Basics
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What
is
Project Management
PM Basics : Defining Project Management
PROJECT MANAGEMENT IS
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PROJECT MANAGEMENT IS
The application of KNOWLEDGE,
SKILLS, TOOLS AND TECHNIQUES
to project activities to meet the
Project Requirements!
PM Basics
The project management is accomplished through
application and integration of the 42 logically grouped
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application and integration of the 42 logically grouped
Project Management Processes comprising 5 Process
Groups
Initiating
Planning
Executing
Monitoring and Controlling
Closing
THE GIST
Managing a project consists of 3 main items:
Identifying requirements!
1
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Identifying requirements!
Addressing the various Needs,
Concerns, and Expectations
of the stakeholders-
as the project is planned
and executed!
2
THE GIST
Managing a project consists of 3 main items:
Balancing competing project constraints,
3
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Balancing competing project constraints,
such as:
a) Scope,
b) Schedule,
c) Budget,
d) Quality,
e) Resources, and
f) Risk.
PM Basics: Managing a project REQUIRES
Iteration of many of the processes within
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project management
Progressive elaboration in a project throughout the
Projects life cycle
The more a project management team learns about a project,
the better the team can manage to greater level of detail
Because of the existence of and necessity for
HOW TO manage the TRIPLE CONSTRAINTS
PM Basics: Triple Constraints
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Q
Time
Scope
Cost
Dimensions of TRIPLE CONSTRAINTS
PM Basics: Triple Constraints
Time
Cost Scope
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Customer satisfaction
Cost Scope
Risk Quality
PM Basics: Program, Portfolio
- What is a program?
- What is a portfolio?
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- What is a portfolio?
- Relationships among project
management, program management,
and portfolio management!
PM Basics: Project Management Context
Wider Perspective of Project Management
Project Management exists in a broader canvas:
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Project Management exists in a broader canvas:
Program Management
Portfolio Management
Project Management exists in
a broader context governed by
PM Basics: Fundamental concepts
70
a broader context governed by
Program and Portfolio Management!
Organizational Strategies and Priorities
are linked and have relationships
- Between portfolios and programs,
- Between programs and individual projects!
Organizational Planning decides prioritization
among the projects, having regard to:
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- Strategic plan
- Funding
- Risk
This means finds and support for component projects
is provided on the basis of risk categories, specific
lines of business, or general type of projects ( internal
process improvement or infrastructure projects).
What is a program?
A program is a group of related projects
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A program is a group of related projects
managed in a coordinated way to obtain
benefits and control not available from
managing them individually!
Programs may include elements of related work
outside the scope of the discrete projects in the
program.
Strategic plan
Generally,
there is a hierarchy of
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Portfolio
Program
Project
Subproject
In this hierarchy, a program
consists of several associated
projects that will contribute to
the accomplishment of
a STRATEGIC PLAN!
Space program
Airplane program
Poverty alleviation
Strategic plan
Portfolio
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Poverty alleviation
program
Subprojects
OFTEN OUTSOURCED Externally, or Internally (to other
unit) on the basis:
- Single phase, HR Skill requirement, Technology
Program
Project A Project B Project C
Subproject Subproject
A PROGRAM
1) extends over a longer period of time horizon.
2) consists of several parallel or sequential work efforts
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2) consists of several parallel or sequential work efforts
that are coordinated toward program goals.
3) time scale for projects tends to be shorter, and projects
are often the individual work efforts of a program.
Urban Development
Program
Housing rehab
Job & Skill
Training
Small business
Consulting
Assistance
Projects
Program
Typical Aircraft
Weapons System
Development
Program
Senior
Management
Integration
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Program
Management
Aerodynamics
project
Aerodynamics
project
Structures
Project
Structures
Project
Propulsion
Project
Propulsion
Project
Avionics
Project
Avionics
Project
Comptroller Comptroller
Processing
Data
Processing
Field
Support
Integration
&
Testing
Procurement
Programs also entail
a series of
Cyclical
undertakings
Fund Raising
Program
of Helpage India
Publishing
India Today
Magazine
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Project 1
Membership drive
Project 2
Advertising
Project 3
Corporate Appeal
Project n
A
series
of
Discrete
Projects
Project 1
Issue January
Project 2
Issue February
Project 3
Issue March
Project n
Issue every month
A
program
where
general
operations
become
MBO
DYNAMICS OF
Portfolio and
Portfolio
Management
Portfolio Management
1. Maximize the value of portfolio by careful scrutiny of
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1. Maximize the value of portfolio by careful scrutiny of
the Proposed Projects and Programs for being
taken within the Portfolio.
2. Timely exclusion of the projects not meeting
Portfolios Strategic Business Objectives.
3. Balance the portfolio AMONG Incremental &
Radical investments AND for efficient utilization of
resources.
Relationships Among Project Management, Program
Management and Portfolio Management!
Highest Level Portfolio
Lower Level Portfolios Higher Level Programs Projects
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Higher Level Programs
Projects
Low Level Programs
Projects
Lower Level Programs Projects
Projects
Comparison Project Management, Program
Item Projects Programs Portfolios
Scope
Defined objectives,
progressively elaborated
Larger scope, more
significant benefits
Scope changes with
strategic goals
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Change
Project Managers expect
change, monitor &
control them.
Program Managers
must expect change
from inside & outside
program, and
manage.
Portfolio Managers
continually monitor
changes in broad
environment.
Planning
Project Managers
progressively elaborate
hi-level info into detailed
plans throughout project
life cycle
Program Managers
develop overall
program plan, create
hi-level plans for
guiding detailed
planning at
component level
Portfolio Managers
develop and maintain
relevant processes
and communication
at total portfolio level.
Comparison Project Management, Program
Item Projects Programs Portfolios
Management
Project Managers
manage the project team
for meeting project
Program Managers
manage program
staff and project
Manage portfolio
management staff.
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for meeting project
objectives.
staff and project
managers. Provide
overall leadership
and vision.
Success
Success criteria: product
& project quality, time
and cost and degree of
customer satisfaction.
Success criteria:
degree to which
program satisfies
needs.
Success criteria:
aggregate
performance and
value indicators.
Monitoring
Project Manager
monitors & controls the
project work
Program Manager
monitors and
controls program
components
Portfolio Manager
monitors aggregate
performance and
value indicators
Project Management Office
An organizational unit to centralize and coordinate
management of projects under its domain.
PMO
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management of projects under its domain.
At minimum, PMO provides Project Management
Support Functions:
1. Training
2. Software
3. Standardized policies & procedures
PMO
Advanced PMOs:
Can get delegated authority to act as integral
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Can get delegated authority to act as integral
stakeholder and key decision-maker during initiation
of each project.
Can have authority to Recommend or Terminate
projects TO KEEP BUSINESS OBJECTIVES
CONSISTENT.
Be involved in selection, management and
redeployment of shared/dedicated project staff.
PM Basics: Functions of PMO
1) Administer shared and coordinated resources across
all projects.
2) Identify and deploy PM Methodology/Bests Practices/
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2) Identify and deploy PM Methodology/Bests Practices/
Standards.
3) Clearinghouse and management of project policies,
procedures, templates, and other shared documents.
4) Central repository/management for shared & unique
risks for all projects.
5) Central office for operation/management of PM Tools
(enterprise pm software).
6) Mentoring of Project Managers.
7) Central coordination of communication across all
projects.
8) Central coordination of overall project quality standards
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8) Central coordination of overall project quality standards
between PM & other quality staff (internal or external),
or standards organization.
9) Central monitoring: all project timelines and budgets at
enterprise level!
What is the difference between the role of a
Project Manager and a PMO?
Role Differences:
1) Project Mangier focuses on specified project objectives.
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1) Project Mangier focuses on specified project objectives.
PMO manages major program scope changes that
(opportunities to better achieve business objectives).
2) Project manager controls assigned project resources.
PMO optimizes use of shared resources across all
projects.
Role Differences:
3) Project Manager manages constraints of the project.
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3) Project Manager manages constraints of the project.
PMO manages constraints among all projects at the
enterprise level. PMO manages the methodologies,
standards, overall risk/opportunity, and
interdependences among Projects at the enterprise
level!
PM Basic: Role of a Project Manager
Role
The project manager is a person assigned by the
performing organization to achieve project
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performing organization to achieve project
objectives!
Role of project manager is different from the role of a
functional manager or operations manager.
- functional manager is responsible for providing
oversight for and administrative area.
- operations manager is responsible for a facet of core
business.
Reporting- depends on the organizational structure!!
1) May report to functional manager (functional, matrix
organizations).
89
organizations).
2) A project manager may one of many other project
managers who report to a program or portfolio manager!
Success
In addition to area-specific skills and general management
proficiencies, a project manager needs to have three
90
proficiencies, a project manager needs to have three
Characteristics for effective project management:
1. Knowledge (about project management knowledge).
2. Performance (what he/she is able to accomplish by
using project management knowledge).
Success
For effective project management, the project manager is
supposed to possess following characteristics:
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supposed to possess following characteristics:
3. Personal (personal effectiveness-attitudes, core
personality traits, and leadership-ability to guide the
project team for success while balancing project
constraints
Project Management Body of Knowledge
The PMBOK is the standard for managing:
1. MOST PROJECT,
92
1. MOST PROJECT,
2. MOST OF THE TIMES,
3. ACROSS MANY INDUSTIRES
THIS STANDARD DEFINES:
- The project management processes (42)
- The tools and techniques of each process
Used to manage a project toward a successful
completion!
THIS STANDARD:
- IS unique to the project management
93
- IS unique to the project management
- HAS interrelationships to other project management
disciplines such as program management and
portfolio management!
Note: this standard does not address all the details
of every topic! It contains processes generally
recognized as good practice applicable to single
projects!!
THIS STANDARD:
94
projects!!
Projects are done in a broader context of program
and portfolio management. Other standards may also
be consulted to gain the broader view:
-The Standard For Program Management
-The Standard For Portfolio Management
THIS STANDARD:
95
projects!!
Other standards may also be consulted to gain the
broader view:
- Organizational Project Management Maturity Model
(OPM3) for assess project management process
capabilities.
Enterprise Environmental Factors
We need to consider all the external and internal factors
that surround our project!
WHY?
96
WHY?
Answer
They may enhance or constraint project
management options! They may have a positive or
negative influence on the outcome!! Remember this.
You will agree when you see what all are these factors.
factors
1) Organization culture, structure, and processes
2) Market conditions
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2) Market conditions
3) Government or industry standards
4) Stakeholder risk tolerances
5) Infrastructure
6) Existing human resources and their special skills
7) Personnel administration (staffing, retention, training
8) Work authorization system
factors
9) Political climate
10) Organizations established communication channels
98
10) Organizations established communication channels
11) Commercial databases
12) PMIS (project management information system)
PMIS- an automated tool. Examples:
- scheduling software tool
- a configuration management system
- an information collection and distribution system
- web interfaces to other online automated systems
Project Life Cycle and Organization
1) The Project Life Cycle and Project Phases
99
1) The Project Life Cycle and Project Phases
2) Project Stakeholders
3) Organizational Influences
The Project Life Cycle
10
0
The Project Life Cycle
and
Project Phases
What is a project life cycle?
A project life cycle is a collection of generally sequential
10
1
A project life cycle is a collection of generally sequential
and sometimes overleaping project phases!
What leads to deciding their number and names?
Management and control needs of the organization or
Organizations involved in the project determine names
and numbers of the project phases! The industry,
the technology, and unique aspects of the organization!
PM Basics : Project Life Cycle and Project Phases
Project
Projects are unique
undertakings.
Involve a degree of
10
2
Phase 1 Phase 2 Phase 3
Involve a degree of
uncertainty.
Hence, each project is divided into several phases
for better management control and providing for
links to the ongoing operations.
Together, the project phases are called the Project
Life Cycle.
Project phases: Sequential Logic
Project
Deliverable I Deliverable II Deliverable n
Makes sure proper
definition of the
projects product
10
3
Deliverable I Deliverable II Deliverable n
Each phase marked by completion of one or more
deliverables.
Takes its name from the item/items, it has to deliver-the
primary phase deliverable.
Output of Preceding phase is input to Succeeding phase
Project phases: What is a deliverable?
DELIVERABLE
is
10
4
is
A TANGIBLE, VERIFIABLE WORK PRODUCT
EXAMPLES
1. A specification,
2. Feasibility report,
3. Detailed design document, or
4. A working prototype
End products or
the components of
Deliverables of the
Project management
Project phases: Types of deliverables
1.
Product deliverables
2.
Project Management Deliverables
10
5
Deliverables, and therefore phases, are part of a
sequential process designed to ascertain proper control
of the project and to accomplish the intended Product/
Service that is the objective of the project.
the components of
end products
for which the project is
undertaken
Project management
process
(charter, scope statement,
plan, baseline, etc.)
PM Basics : Project Phases and Project Life Cycle
Phases can be further subdivided into subphases
Project
Size, complexity, level of risk,
and cash flow constraints
10
6
Phase 3 Phase 2 Phase 1
Subphase
Subphase
Subphase
and cash flow constraints
decide further division of
phases into subphases.
Each subphase is aligned with
defined deliverable (s) for
monitoring and control, and
are related to primary phase
deliverable.
PM Basics : Phase End Review
Project
Requirements Design
Deliverable
n
Completion of each phase
marked by review of:
1) Key deliverable,
10
7
Design
n
Determine
- Should project continue
into phase.
- Find out errors cost
effectively, and correct
them if necessary.
1) Key deliverable,
2) Project performance to date
R R
Phase end review = R
phase exits
stage gates
kill points
PM Basics : Fast-tracking Phases
Starting activities of next phase without closing the current
phase! Examples abound:
Often, the management review is conducted to decide
Beware!
10
8
Often, the management review is conducted to decide
beginning activities of next phase before the current
one is closed.
Most IT projects use an iterative cycle in which more
than one phase are undertaken at the same time:
Requirements for a module are collected and analyzed
prior to the design and construction the module.
Requirements of another module are collected while
analysis of previous module is underway!
PM Basics : Project Phases
Common characteristics of phases
1. When they are sequential
10
9
a) at the close transfer of work product
b) phase end review (called phase exit,
milestones, phase gates, decision gates, or
kill points)
2. The work has distinct focus in each phase and involves
different organizations and skill sets.
Common characteristics of phases
2. The primary deliverable requires an extra degree of
11
0
2. The primary deliverable requires an extra degree of
control for success
3. The repetition of process across all 5 process groups
provides that additional degree of control and defines
boundaries of the phase!
Project phases vital points
Many projects may have similar phases, few are
11
1
Many projects may have similar phases, few are
identical.
2. Some projects may have just one phase. Single phase
project.
3. Others may have multiple phases.
Project phases vital points
4. There is no rigid, single way to define ideal structure for
a project. Industry common practices. Some
11
2
a project. Industry common practices. Some
organizations own way of defining phases.
Example: Feasibility Study
- A routine pre-project work OR
- First phase of the project OR
- A separate stand-alone project
Typical Sequence of Phases in a PLC
Phases FINAL INITIAL INTERMEDIATE
Inputs
Idea Resources
11
3
Project
Deliverable
Project
Management
Outputs
Charter
Scope
Statement
Plan
Baseline
Progress
Acceptance
Approval
Handover
PRODUCT
Each phase is formally initiated to keep focus on project
objectives!
PM Basics: Project Life Cycle
Project Life Cycle
Project life cycle (PLC) defines what one needs to do
to do the work on the project
11
4
to do the work on the project
Construction PLC
Feasibility, planning, design, product, turnover, and
startup.
Information systems PLC
Requirements analysis, high-level design, detailed
design, coding, testing, installation, conversion, and
operation.
BSES
Project
Requirements Test Turnover Build Design
Project
Management
11
5
Management
Project life cycle
defines start and finish of the project
determines transactional actions at the start and finish
of the project
START FINISH
PLC Characteristics
Uncertainty and risk are highest in the beginning.
PM Basics : Project life cycle characteristics
11
6
The chances of successfully completing the project
are therefore lowest at the start.
But as we proceed, the uncertainty, risk become
progressively reduced, and our chances of
successfully completing the project become
progressively brighter
Project life cycle characteristics
11
7
Life Cycle of Project (Time)
High
Low
Amount at Stake
Uncertainty of Success AND RISK
The cardinal principle
Stakeholders ability to influence the final
11
8
Stakeholders ability to influence the final
characteristics the product of the project is highest
only in the beginning .
As project proceeds, it gets diminished
progressively and then the cost of any change, or
correction becomes very high.
This lays stress proper scope definition to avoid
later surprises .
PLC Characteristics
opportunity to add
High
Opportunity to add value
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9
opportunity to add
value highest at the
start and lowest at
the end.
Cost of change
lowest at the start
and highest at the
end
Low
High
Cost of change
Opportunity to add value
Time
Project life cycle
COST TO CORRECTION
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0
Life Cycle of Project (Time)
High
Low
Requirements / Architecture / Detailed Design / Construction Maintenance.
COST TO CORRECTION
Project life cycle Example:
BSES Project
12
1
BSES
Project
Requirements Test Turnover Build Design
Project
Management
Project life cycle
All the project phases of a project together determine
the project life cycle!
EXAMPLE 1: Project life cycle and project phases
CONSTRUCTION PROJECTS
Full
operation
Engineering and
major contracts
let
P
e
r
c
e
n
t
a
g
e

c
o
m
p
l
e
t
e
Synthetic
Yarn Project
12
2
Life cycle stages
Stage I Stage II Stage III Stage IV
Installation
substantially
complete
let
Project
GO
decision
P
e
r
c
e
n
t
a
g
e

c
o
m
p
l
e
t
e
Yarn Project
Stage handoffs
Operations and
production
Support
EVALUATE
IDENTITY
Deploy
Test
Evaluation
Unit Requirements
SOFTWARE PROJECTS
12
3
CONSTRUCT
DESIGN
Software
Development
Logical Design
Physical
Design
Final Design
First Build
Second Build
Third Build
Proof of
Concept
Conceptual
Design
Evaluation
Evaluation
Risk Analysis
Business
Requirements
System Requirements
subsystem Requirements
Unit Requirements
A
Pharmaceutical PROJECT
Drug Discovery
Project
Process Development
Formulation Stability
12
4
A
P
P
R
O
V
A
L
Post
Registration
Activity
Drug
Sourcing
Screening
Lead
Identified
Preclinical
IND
Workup
File
IND
Patent Process
File
IND
Metabolism
Toxicology
Phase-I
Clinical
Tests
Phase-II
Clinical
Tests
Phase-III
Clinical
Tests
Ten Plus Years
Preclinical
Discovery Screening Development
Registration(s)
Workup
Post
Submission
Activity
Project Life Cycle
Most projects are linked to the ongoing operations
of the performing organization
12
5
Projects are authorized only after due feasibility
study (or preliminary plan/ equivalent analysis),
which may be taken as a separate project.
This sometimes requires extra phases to develop
and test a prototype before initiating a project for
developing the final product.
Certain internal service projects are initiated
informally.
Project Life Cycle: Phase-to-phase relationships
Sequential relationship
Overlapping relationship (another phase can start
12
6
Overlapping relationship (another phase can start
before completion of another one. Fast tracking.
Increases risk and rework. Used for schedule
compression.
Iterative relationship (only one phase is planned at
any given time and the planning for the next is done
as work progresses on the current phase and
deliverables. Useful in undefined, uncertain, or rapidly
changing environments. Research projects.
PM Basics: Project Life Cycle and Product life Cycle
Project life cycle defines start and finish of a project with intermediate
phases. Product life cycle is a broader concept. It begins with business
plan, through idea, to product, ongoing operations and ends with product
divestment. Project life cycle is but a phase of product life cycle!
12
7
Feasibility Product development Operations Disposal
Operation and support
Maintenance and support
R
e
q
u
i
r
e
m
e
n
t
s
D
e
s
i
g
n

C
o
n
s
t
r
u
c
t

T
e
s
t

a
n
d

i
n
s
t
a
l
l
Project Life Cycle
Product life cycle
divestment. Project life cycle is but a phase of product life cycle!
Relationship between Project and Product Life Cycle
We must take care to distinguish project life cycle from the product life
cycle, and understand how fast the product will become obsolete, in
view of the technological advances and stiff competition! The design
should withstand longer stay.
12
8
DIVESTMENT
Project
Lifecycle
FINAL
INITIAL INTERMEDIATE
Business
plan
PRODUCT
LIFE
CYCLE
I
D
E
A
OPRNS DIV
OPERATIONS
UPGRADE
PRODUCT
should withstand longer stay.
PM Basics : Project Management Life Cycle
Project Management Life Cycle
Project management life cycle (PMLC) defines
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9
Project management life cycle (PMLC) defines
what one needs to do to manage the
project
PHASE OF PROJECT MANAGEMENT LIFE CYCLE
Initiating, planning, executing, monitoring and
controlling, and closing.
Define Goal Plan
project
Execute
plan
Evaluate
project
Close
project
Project Stakeholders
Individuals and organizations
PM Basics: Project Stakeholders
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0
Actively involved in the project OR
Whose interests may be positively or negatively
affected by the performance or completion of the
project.
Stakeholders may exert influence over the project, its
deliverables, and the project team members!
KEY POINT
The project Manager MUST
13
1
identify all internal and external stakeholders!
determine their requirements and expectations!!
manage the influence of the various stakeholders in
relation to project requirements to ensure successful
outcome!!!
Examples of stakeholders
Customers/users
Sponsor
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2
Sponsor
Portfolio managers/portfolio review board
Program managers
Project management office
Project managers
Project team
Functional managers
Operations management
Sellers/business partners
Key Project Stakeholders
Government
Suppliers Performing
Sponsor
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3
Government
Customers/
user
Suppliers
Sub Contractors
Performing
organization
Top
Management
Boss
Internal Users
Functional department
personnel
Project Staff
Team members
Project Manager
PMO
INFUENCERS
in Customer
organization
Influencers
Project
sponsor
PROJECT
Relationship between stakeholders and the project
13
4
Project stakeholders
Project team
Project
Management Team
Project
Manager
sponsor
PROJECT
Stakeholders responsibility and project outcomes
Stakeholders Responsibility and
authority
Project outcomes
13
5
authority
Varying levels
Changes over the course of
project life cycle
Occasional contributions in
surveys to focus groups to full
project sponsorship (financial /
political support)
Project outcomes
DAMAGING
Project outcomes
HIGHLY
POSITIVE
Stakeholders responsibility and project outcomes
Stakeholders Responsibility
13
6
Stakeholders Responsibility
and authority
Project Managers
who ignore stakeholders
DAMAGING
Project
outcomes
DAMAGING
Positive stakeholders
Positive / Negative Stakeholders
Negative stakeholders
13
7
Positive stakeholders
Those who would benefit
from the project
Community Business leaders gain
from an industrial project as they
find economic benefit for the
community from projects success
- Rs. 100 million Reliance Power
Project in Dadri, U.P. hailed by Amar
Singh Group of Ruling Party.
Negative stakeholders
Those who see negative
outcomes from projects
success
Environmental activists may see
projects success leading to
environmental hazards.
THE CHALLENGE
Stakeholder Management
13
8
THE CHALLENGE
Stakeholders have differing needs,
perspectives, and expectations to be
managed by the project manager.
Stakeholder expectations: differing objectives
MARKETING DEPT.
High features
TECHNICAL DEPT.
State-of-Art
MANAGEMENT
13
9
PRODUCT
of
PROJECT
State-of-Art
Technology,
low cost of
operation
CUSTOMER
Cheaper and
Long lasting
SOCIETY
Comfortable and
Eco-friendly
GOVERNMENT
Satisfying
Government
pollution and
safety norms
MANAGEMENT
profitable
FINANCE
Low cost of
procurement
CONCURRENT ENGINEERING
14
0
provides
Solution to the problem
of
differing stakeholder needs, perspectives,
and expectations.
14
1
It refers to the combined early efforts of
That final
product of
the project
satisfies
everyone
designers
developers
producers
salesperson, and
other stakeholders
To ensure
Identify stakeholders
Assess their knowledge and skills
14
2
Assess their knowledge and skills
Analyze the project to make sure their needs will
be met
Get and keep them involved through assigning
them work, using them as experts, reporting to
them, involving them in changes and the creation
of lessons learned
Get them to sign-off and obtain their formal
acceptance
Managing Stakeholders
Resolving stakeholder conflicts is major task on the
project. You have to continuously find ways to satisfy
14
3
project. You have to continuously find ways to satisfy
their needs.
In general, differences between and among
stakeholders should be resolved in favor of the
customer!
But remember, not to disregard needs and expectations
of other stakeholders.
In fact, it is your major challenge to find appropriate
resolutions to such differences!!
PM Basics: organizational influences
Organizational influences on the project
14
4
PROJECT
corporations
Healthcare
Institutions
Other
Organizations
Maturity of the organization with respect to
14
5
organizational SYSTEMS
organizational CULTURE and STYLES
organizational STRCUTURE
role of PMO in ORGANIZATIONAL STRUCTURES
PROJECT MANAGEMENT SYSTEM
Maturity of the organization with respect to
its:
14
6
Project-based
Non-project-based
14
7
derive their revenue from performing projects
engineering/ consultant/ architectural / construction
companies, government contractors
Project-based
14
8
adopted management by projects
like their financial system account, track, and report on
multiple, simultaneous projects
try to have project management systems
generally do not have adequate PM Systems
Non-project-based
Performance of work
Organizational
Culture
14
9
organizational CULTURE and STYLES
Values, norms, beliefs, and expectations
(shared within organization)
Work ethics and work hours
Policies and procedures
View of authority relationships
IMPACT OF ORGANIZATIONAL INFLUENCES
on the success of the project
Organization culture can be entrepreneurial,
aggressive, participatory, rigid hierarchical, fraught
with infighting and politics, friendly and human-
centered, etc.
15
0
centered, etc.
1) Pepsi has a culture that is aggressive, your
high-risk approach is welcome there.
2) Century Cotton Mill has rigid hierarchical culture,
your participatory style will not work there.
3) HCL Corporation has participatory culture, it can not
accommodate anybodys authoritarian style.
REAL LIFE EXAMPLES
Constraints the availability
15
1
Constraints the availability
of
resources resources
Functional to Projectized
Functional
MATRIX
Weak matrix
Balanced matrix
Strong matrix
Projectized
Impact of organizational structure
Tell me what type of organizational structure you are working in
and I will tell you how much you will SUCCEED as a Project Manager !
15
2
Organizational structure that has served ongoing
organizations for ages is no longer suitable for
performing projects !!
As Project Manager, you are responsible for managing
the project and if you do not have authority to make
resources available, you will fail miserably !!!
Impact of organizational structure
FORMS OF ORGANIZATIONAL STRUCTURE
WEAK
MATRIX
15
3
Functional
MATRIX
BALANCED
MATRIX
STRONG
MATRIX
PROJECTIZED
COMPOSITE
Functional Structure
MOST COMMON / TRADITIONAL FORM
15
4
Organization is structured by functions:
Marketing, Engineering, Manufacturing, Finance, HR.
Each one works
as separate entity
with managers and subordinates.
Functional
CEO
Project
coordination
Staff engaged
in project work
15
5
CEO
Functional
Manager A
Functional
Manager C
Functional
Manager B
Staff
Staff
Staff Staff
Staff
Staff Staff
Staff
Staff
coordination
EXAMPLE
A PRODUCT
DEVELOPMENT
PROJECT
Design phase
called design
project by
engineering
department
Communication
through heads
of departments
only
ADVANTAGES
1) Easier management of
functional specialists.
DISADVANTAGES
1) More emphasis on
functional specialty to
15
6
2) Team members report
to only one supervisor.
3) Similar resources are
centralized to function,
companies are grouped
by functions/specialties.
4) Clearly defined career
path in the functional
area.
2) Project Manager has no
detriment of the project.
2) Project Manager has no
authority.Power with
FMs.
3) Scope of the project
limited to functional
boundary.
4) No career in project
management.
Projectized Structure
PROJECTIZED ORGANIZATIONS ARE
JUST OPPOSITE OF FUNCTIONAL:
15
7
JUST OPPOSITE OF FUNCTIONAL:
All organization is by projects.
The project manager has
total control of projects.
Team members are collocated
Most organizations resources assigned to project work
CEO
Project
coordination
Staff engaged
in project work
Projectized
15
8
CEO
Project
Manager A
Project
Manager C
Project
Manager B
Staff
Staff
Staff Staff
Staff
Staff Staff
Staff
Staff
coordination
IDEAL
Project Manager
Sole Authority
Departments
report directly to
the Project
Manager or
provide support
services
ADVANTAGES
1) Project manager has
ultimate authority over
DISADVANTAGES
1) No home for project
team members when
15
9
ultimate authority over
the project.
2) Loyalty to the project.
3) More effective
communication than
functional.
4) Team members are
collocated
team members when
project is completed.
2) Less efficient resource
utilization, though efficient
project organization.
3) Lack of professionalism
in disciplines.
4) Duplication of facilities
and job functions.
Matrix Structure
SINCE BOTH FUNTIONAL AND PROJECTIZED HAVE STRENGTHS
AND WEAKNESSES, we need to maximize strengths and
weaknesses.
16
0
weaknesses.
MATRIX: best of both organizational structures.
Employees in a matrix organization report to
one FM and at least one PM.
PM and FM together conduct performance
review of the employees.
Matrix Structure
Matrix organizations are of three types:
16
1
WEAK
MATRIX
BALANCED
MATRIX
STRONG
MATRIX
Matrix Structure
Weak matrix (more like functional)- Here, the balance
of power rests with the FM and PM is merely an
expeditor or coordinator.
WEAK
MATRIX
16
2
expeditor or coordinator.
Project expeditor acts mainly as a staff assistant and
coordinates communication. Project expeditor can not
make or enforce any decisions.
Project coordinator has some power to make
decisions and reports to higher level manager than
expeditor.
Matrix Structure
CEO
Staff engaged
in project work
Weak matrix
16
3
Staff
Project
coordination
CEO
Functional
Manager A
Functional
Manager C
Functional
Manager B
Staff
Staff
Staff Staff
Staff
Staff Staff Staff
Matrix Structure
BALANCED
MATRIX
Balanced matrix- The power is balanced between
project manager and functional manager.
16
4
project manager and functional manager.
Each manager has responsibility for his/her part of the
project or organization, and people get assigned to
projects based on the needs of the project, not
strengths or weakness of the managers position.
Most organizations are Balanced Matrix these
days!
Matrix Structure
CEO
Staff engaged
in project work
Balanced matrix
16
5
Project
coordination
CEO
Functional
Manager A
Functional
Manager C
Functional
Manager B
Staff
Project Manager
Staff Staff
Staff
Staff Staff
Staff
Staff
Matrix Structure
STRONG
MATRIX
16
6
Strong matrix is more like projectized.
Here,
The balance of power rests with
The project manager
not
The functional manager.
Matrix Structure
Strong matrix
CEO
Staff engaged
in project work
16
7
Project
coordination
CEO
Functional
Manager A
Functional
Manager C
Functional
Manager B
Staff
Staff
Staff Staff
Staff
Staff Staff
Staff
Staff
Manager of
Project Managers
Project
Manager
Project
Manager
Project
Manager
Matrix Structure
RELEVANCE FOR PROJECTS
Highly visible project Not cost effective as
ADVANTAGES
DISADVANTAGES
16
8
Highly visible project
objectives.
Improved PM control
over resources.
More support from
functions.
Maximum utilization of
scarce resources.
Better coordination.
Not cost effective as
more administrative
personnel are
needed.
More than one boss for
project team.
More complex to
monitor and control.
Matrix Structure
Better information flow
(both horizontal and
Tougher problems with
resource allocation.
ADVANTAGES
DISADVANTAGES
16
9
(both horizontal and
vertical) than functional.
Team members
maintain a home, they
continue to belong to
their respective
departments unlike
projectized.
resource allocation.
Requires extensive
policies and procedures.
FMs may have differing
priorities than PMs.
Higher potential for
conflicts and duplication
of efforts.
Composite Structure
Composite organization
CEO
Staff engaged
in project work
Project Y
17
0
Project X
coordination
CEO
Functional
Manager A
Functional
Manager C
Functional
Manager B
Staff
Staff
Staff Staff
Staff
Staff Staff
Staff
Staff
Manager of
Project Managers
Project
Manager
Project
Manager
Project
Manager
Project Y
Coordination
Staff
Staff
Functional
Matrix
Weak Balanced Strong
Projectized
Structure
Features
Organizational structure influences on project
17
1
Weak Balanced Strong
Project
Manager
Power
Little or none Limited Low to
Moderate Moderate
to High
FULL
AUTHORITY
Resource
Availability
Little or none Limited Moderate Moderate
to High
ALMOST
TOTAL
Budget
Control
Functional
Manager
Functional Mixed Project
Manager Manager
Project
Manager
Role of Project
Manager
Part time Part time Full time Full time
On projects on projects on projects
FULL TIME ON
PROJECTS
Administrative
Staff
Part time on Part time Full time Full time
On projects on projects on projects
FULL TIME ON
PROJECTS
Features
Organization Process Assets
1. Corporate Knowledgebase
OPAs help us throughout the project!
17
2
2. Policies, Processes and Procedures
17
3
- Historical information from previous projects
- Lessons learned from previous projects
Project files, process measurement databases, issue and
defect management databases, configuration
management databases, versioning and rebaselining info,
Financial databases, overruns, etc.
2. Policies and Procedures
- organization's policy and procedures for conducting work
17
4
Organizational standards, policies, standard product and
project lifecycles, quality policy and procedures, work
instructions, performance measurement criteria, proposal
evaluation criteria, Templates (WBS, Network Diagram,
Contract Templates), ethics policy, project management
policy, Guidelines/criteria for tailoring, Project Closure
Guidelines/Requirements..
2. Policies and Procedures
17
5
Issue and defect management procedures,
Procedures for prioritizing, approving and issuing work
instructions, Change Control Procedures, Risk Control
Procedures, Financial Control Procedures,
Organizational Communication Requirements.
PM Basics
17
6
Project Management Processes
PM Basics: Project Management Knowledge Areas
PM Basics: Last Leg!
The Project Management Processes
17
7
The Project Management Processes
But, before we master its concepts, we
need to know the knowledge areas
which contribute
as building blocks of the
Project Management Process Groups!
Project Management
Knowledge Areas
17
8
Knowledge Areas
Describe Project Management Knowledge and Practice in
terms of THEIR COMPONENT PROCESSES.
9 Knowledge Areas!
o Integration
o Scope
WHY
17
9
o Scope
o Time
o Cost
o Quality
o Human Resource
o Communications
o Risk
o Procurement
WHY
NINE
KNOWLEDGE
AREAS?
Supports various elements
of project management which
Project Integration Management
Develop Project Charter
Develop Project Management Plan
Direct and Manage project
execution
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0
of project management which
are identified, defined,
Combined and coordinated
To ensure project includes
all the work required and
Only the Work needed to
complete project
Successfully
Project Scope Management
execution
Monitor and control project work
Perform Integrate change control
Close project or phase
Collect requirements
Define scope
Create WBS
Verify scope
Control scope
To ensure timely completion
Project Time Management
Define Activities
Sequence Activities
Estimate Activity Resources
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1
To ensure timely completion
of the project
Planning, controlling, and
managing costs so
that project is completed
within approved Budget
Project Cost Management
Estimate Activity Durations
Develop Schedule
Control Schedule
Estimate Costs
Determine budget
Control Costs
To ensure project will satisfy
Project Quality Management
Plan Quality
Perform Quality Assurance
18
2
To ensure project will satisfy
NEEDS for which it was
undertaken
To make most effective
use of people involved
with the project
Project HR Management
Perform Quality Assurance
Perform Quality Control
Develop Human Resource plan
Acquire project team
Develop project team
Manage project team
To ENSURE TIMELY and
APPROPRIATE generation,
Project Com. Management
Identify Stakeholders
Plan Communications
Distribute Information
18
3
APPROPRIATE generation,
collection, dissemination, Storage
and disposition of the
PROJECT INFORMATION
Concerned with
identifying, analyzing, and
responding to project risks
Project Risk Management
Manage stakeholders expectations
Report Performance
Plan Risk Management
Identify Risks
Perform Qualitative risk analysis
Perform Quantitative risk analysis
Plan Risk responses
Monitor and control Risks
To acquire material, goods
Project Procurement
Management
Plan procurements
Conduct procurements
Administer procurements
18
4
To acquire material, goods
and services outside
performing organization
To meet project scope
Administer procurements
Close procurements
PM Basics
So, here we come!
We will now deal with
18
5
We will now deal with
Project Processes
Process Groups
Process Interactions
Customizing Process Interactions
Mapping of Project Management Processes
Just a foundation
talk
at the outset!
PM Basics: Project Management Processes
Project Team must:
1) Select right processes within the process groups.
18
6
1) Select right processes within the process groups.
2) Use defined approach to adapt product specs and
plans to fulfill PROJECT and PRODUCT
Requirements.
3) Adhere to the requirements to fulfill the needs,
wants, and expectations of the stakeholders.
4) Balance competing demands of Scope, Time,
Cost, Quality, Resources, and risk to accomplish
a quality product, service, or result.
We will discuss about what is required to:
18
7
We will discuss about what is required to:
1) Initiate
2) Plan
3) Execute
4) Monitor and control, and
5) Close a project.
What is a process?
Project Processes
18
8
A set of
interrelated
actions
&
activities
To accomplish
A
pre-specified
set
of products,
services, or
results
PERFORMED
Project processes are performed by the project team
and consist of two main categories:
1)
18
9
Project
Processes
Project
Management
Processes
Product-oriented
Processes
1)
2)
1) Are common to most projects most of the
time.
19
0
2) Are related with each other by their
performance for an integrated purpose of
initiating, planning, executing, monitoring and
controlling, and closing a project!
3) These processes interact with each other in
complex ways (discussed a little later).
PM Basics: Product-oriented Processes
1) Specify and create projects product.
2) Are typically defined by the respective
project life cycle.
19
1
project life cycle.
3) Vary by application area!
Both project management processes and product-oriented
processes overlap throughout the project.
Example: You can not define the project scope without
basic knowledge of how to create the concerned product!
PM Basics: Project Processes
Project management
is an integrative effort
A change in scope
Always Though, it may or
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2
Scope, Time,
Cost,
Quality, Risk, etc.
Any action or lack
of it in one area
affects other areas
Project cost
Always
affects
Though, it may or
may not affect
product quality
or morale of the
team
PM Basics: Project Processes SOME TRUTHS!
Project processes interactions require trade
offs among project objectives (scope, time,
cost, and performance).
19
3
cost, and performance).
Enhancing performance in one area leads to
scarifying SOMETHING in another area.
Hence, project objectives are called triple
constraints shown through a triangle with its
sides or corners representing each constraint
(we have already discussed it).
PM Basics: PM Process Groups
Initiating
Process Group
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4
Process Group
Authorizes the project or phase
Planning
Process Group
19
5
Process Group
1) Establish the scope of the project,
2) Refine the objectives,
3) Define the course of action for attaining the
objectives.
Executing
Process Group
19
6
Complete the work defined in the project
management plan to satisfy the project
specifications! Coordinates people and resources.
Monitoring & Controlling
Process Group
19
7
Process Group
- Track, review, and regulate the progress and
performance of the project.
- Manage changes to the project management
plan
Closing
Process Group
19
8
- Finalize all activities across all Process
Groups to formally close the project or phase.
- Brings it to an orderly end.
PM Basics: Project Management Process Groups
Project Management Process Groups
INTERACTIONS
Initiating
Process
Planning
Process
Charter
PM process groups are
linked by their outputs.
Output of one is input to
another .
19
9
Executing
Process
Closing
Process
Controlling
Process
Project
Plan
Recommended
Corrective
actions
Work results
Implemented
Corrective actions
For Project
Plan updates
Correctly
Produced
deliverables
for formal
acceptance
Project Process Groups Interactions: HIGH LEVEL
SOW
Culture, PMIS, HR Pool
Defined work processes, Knowledge base
Organization
Environmental factors
Project Initiator
of Sponsor
INITIATING
Process Group
CONTRACT
Project Charter
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0
Organizational
Process assets
Customer
PLANNING
Process Group
EXECUTING
Process Group
MONITORING &
CONTROLLING
Process Group
CLOSING
Process Group
Project PLAN
Deliverables
APPROVED DELIVERABLES
Final product
Administrative & contract closure
Org. process assets updates
overlapping in a phase
Executing
Process
Group
Controlling
Process
Group
Closing
Process
Group
PM process groups
overlap and occur at
various levels of intensity
throughout each Project
Phase.
L
e
v
e
l

o
f

a
c
t
i
v
i
t
y
Initiating
Process
Group
Planning
Process
Group
20
1
Phase.
They are not one-time,
discrete events!
time
L
e
v
e
l

o
f

a
c
t
i
v
i
t
y
Phase
Start
Phase
Finish
Closing
Process
Initiating
Process
Planning
Process
Executing
process
Controlling
Process
Group Group
Closing one phase offers input to initiating the next phase!
cross phases
Design phase
Execution phase
Output:
20
2
Later
Phases
Execution phase
Prior
Phases
Output:
Design document
requiring customer
acceptance
Output:
Design
document
Serves as
product
description
for
Execution
phase
Why repeat initiation process at the beginning of each phase?
20
3
1) Well, it keeps the project focused on the business
need for which it has been taken up!
2) It helps you halt the project if the project is not likely
to satisfy the business need!
3) It helps you halt the project if the business need
does not exist any more!
PM Process Groups
20
4
PM Process Groups
Controlling
Processes
Initiating
Processes
Planning processes
Executing processes
Project boundaries
Project boundaries
20
5
Project boundaries
Controlling
Processes
Initiating
Processes
Planning processes
Executing processes
Project
Inputs
Project
Initiator
Sponsor
Project
Deliverables
Project
Records
End
User
Process
Assets
INITIATING PROCESSES
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6
INITIATION PROCESS GROUP
INTEGRATION
COMMUNICATION
Develop
Project Charter
Identify
stakeholders
Planning
process group
Executing
process group
Monitoring &
controlling
process
group
INITIATING PROCESS GROUP
THE PURPOSE
Facilitates formal authorization to begin a new
20
7
Facilitates formal authorization to begin a new
project or phase.
Done outside the projects scope of control.
Business needs or requirements are documented.
Normally the feasibility is established by evaluating
various alternatives and choosing the best one.
WHAT IS DONE HERE?
Clear descriptions of project objectives are developed,
noting down the reasons for selecting the project to
20
8
noting down the reasons for selecting the project to
best satisfy the requirements
Such decision also gives us basic description of
1) project scope
2) deliverables
3) forecast of resources
4) high-level constraints, assumptions, risks
VERY IMPORTANT
Involving stakeholders during initiation
20
9
Involving stakeholders during initiation
1) develops Shared Ownership,
2) enhances Chances of Deliverable
Acceptance, And
3) Customer/other stakeholders
Satisfaction!
Simply put, this process group
21
0
1. Authorizes/starts a project or phase
2. Defines projects purpose
3. Identifies objectives
4. Empowers project manager to
start the project
Please remember this!
PLANNING processes
Are used to plan and manage a successful project
Purpose of Planning Processes:
21
1
Are used to plan and manage a successful project
Help gather information from many sources for
completeness and confidence
Develop project plan
Identify, define, and mature:
Project scope, requirements
Project cost, and
Schedule the project activities
PLANNING processes
As new information is found out, additional
21
2
As new information is found out, additional
requirements, risks, opportunities, constraints,
assumptions, and dependencies are identified
and resolved!
As more information is grasped, follow-on
actions are undertaken
Additional analysis through feedback loops
PLANNING processes
21
3
One/more
Planning
processes
revisited
( may be some
initiating
processes too )
Significant
changes
throughout
Project life cycle
PLANNING processes
21
4
Parts of the
project plan
Updates
from
Approved changes
Substantially
influence
Costs, schedule, and
resource requirements
to meet
Project Scope
Provide
greater
precision
PLANNING PROCESSES (with interactions)
Define scope- Project scope statement
Create WBS- Scope baseline
Enterprise- OPAs, EEFs
Collect requirements- requirements docs, RMP
Develop Project
Charter- charter
Develop Project
Management
Plan- Proj. Mgt. Plan
Verify scope
Control scope
Control
schedule
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5
Collect requirements- requirements docs, RMP
Determine budget- cost performance baseline
Develop schedule- schedule baseline
Plan quality- QMP, PIP
Develop HR plan- HR Mgt. Plan
Plan communications- Com Mgt. plan
Plan risk management- Risk Mgt. Plan
Plan procurements- Procurement Mgt. Plan
Plan- Proj. Mgt. Plan
Direct & Manage
Project Execution
Monitor & Control
Project Work
Perform Integrated
CC
Close project or
phase
schedule
Control cost
Perform QC
Report
performance
Monitor &
control
Risks
Administer
procurements
PLANNING PROCESSES
Scope management plan
Requirements management plan
Project baselines
(Scope baseline, Cost baseline,
and Schedule baseline)
Subsidiary plans
Components
Project Management Plan
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6
Schedule management plan
Cost management plan
Quality management plan
Process improvement plan
Human resource plan
Communication management plan
Risk management plan
Procurement management plan
and Schedule baseline)
Project life cycle & phase
processes chosen
PM processes selected
Execution methods
Change management plan
Configuration mgt. Plan
Baseline integrity process
Key mgt. Review to facilitate
open and pending decisions
Understanding Component Processes of
PLANNING PROCESS Group
Before we develop final project
plan, take approval, and publish it
for execution, we need to conduct
21
7
for execution, we need to conduct
many iterations to make sure that
our plan meets:
1) project objectives
2) is realistic and
3) achievable.
EXECUTING process group
Perform activities to accomplish project
requirements
Create project deliverables
21
8
Create project deliverables
Acquire, train, and manage team
members.
Obtain and manage resources
Implement planned methods and
standards
Establish and manage communication
Generate project data for status and
forecasting
EXECUTING process group
Issue change request
Adapt approved changes into projects
scope, plans and environment
21
9
scope, plans and environment
Manage risks and execute response
activities
Manage sellers and suppliers
Execute approved process
improvement activities
Collect and record lessons learned
Project manager and project management team manages
performance of activities and various organizational interfaces.
EXECUTING processes
Direct and Manage Project Execution
also needs implementation of:
22
0
- Approved corrective action to recover variance.
- Approved preventive action to reduce chances
of negative consequences of associated project risks.
- Approved defect repair to repair or replace a
defective component.
EXECUTING PROCESSES
Perform
Quality
Assurance
Monitoring &
Controlling
Process
Group
Initiating
Process
Group
22
1
Acquire
Project
Team
Manage
Project
Team
Conduct
procurements
Distribute
Information
Direct
and
Manage
Project
Execution
Closing
Process
Group
Planning
Process
Group
Develop
Project Team
Manage
Stakeholder
Expectations
Monitoring & Controlling process group
Main benefit:
22
2
Main benefit:
PROJECT PERFORMANCE
IS OBSERVED AND MEASURED
REGULARLY
TO
IDENTIFY VARIANCES FROM
THE PROJECT MANAGEMENT PLAN
Consists of processes needed to
Track, review, and regulate progress and
22
3
Track, review, and regulate progress and
performance
Identify areas where changes to the plan are
needed. And initiate such changes.
CONTROL CHANGES AND
RECOMMEND
22
4
RECOMMEND
PREVENTIVE ACTION
in
Anticipation of potential problems
1. Monitor project activities!
2. Influence the factor that could circumvent integrated
22
5
2. Influence the factor that could circumvent integrated
change control to ensure only approved changes are
executed!
The project team gets insight into the health of the
project !
Highlights areas needing additional care !
Helps monitoring and controlling ENTIRE
PROJECT EFFORT !
SAVES THE PROJECT
22
6
When variances threaten the project
objectives
relevant
project management
processes within the
PLANNING PROCESS
GROUP
are
REVISITED
Recommends updates to
the project plan rescue the project
A missed activity completion
Date needs:
SAVES THE PROJECT
22
7
When variances threaten the project
objectives
Date needs:
1. Trade-offs between schedule &
budget targets
2. Dependence on over time
3. Adjustments to present staffing
plan
Recommends updates to
the project plan rescue the project
MONITORING AND CONTROLLING PROCESSES
Verify Scope
Control Scope
Initiating
Process
Group
22
8
Control Schedule
Control Costs
Perform quality control
Report Performance
Monitor & Control
Risks
Administer
Procurements
Monitor &
Control
Project work
Perform
Integrated
Change
Control
Planning
Process
Group
Executing
Process
Group
Closing
Process
Group
Monitor and
Provides
Change requests.
22
9
Monitor and
Control Project
Work
Change requests.
Recommended corrective /
preventive action.
Recommended defect
repair.
FORECASTS.
Perform
Provides
Approved change requests
23
0
Perform
Integrated
Change Control
Approved preventive action
Approved corrective action
Approved defect repair
Validated defect repair
Non-approved change requests
Updates of Project Management Plan
CLOSING processes
Consists of processes to
Finalize all activities across all PM Process
Groups for formal completion of the project,
23
1
Groups for formal completion of the project,
phase, or contractual obligations.
Hand off the completed product to others
(customer if on contract)
Close a cancelled project
CLOSING processes
Completion of defined processes
23
2
Completion of defined processes
within all Process Groups is verified
Accomplishment of a project or
phase is formally established
CLOSING processes
Following occurs during project or phase closure:
Customer or sponsor acceptance
Project-end or phase end review
23
3
Project-end or phase end review
Impacts of tailoring to any process documented
Lessons learned recorded
OPAs updated
Documents archived as historical information in
project management information system.
Procurements are closed out.
CLOSING processes
Closing Process Group
Planning
Process
Group
23
4
CLOSE PROJECT or
Phase
CLOSE
PROCUREMENTS
Executing
Process
Group
Monitoring &
Controlling
Process
Group
Understanding Component Processes of
CLOSING PROCESS Group
Soon as we meet accomplish one project, we tend
to move on to the next one without properly
closing the earlier one.
23
5
closing the earlier one.
Result?
We keep on reinventing the wheel!
Project information created in a particular
project along with mistakes committed,
corrective actions taken are not documented.
Then, there is no literature to guide us on similar
future projects.
RECAP
Project
Process
Monitoring &
Controlling Processes
Planning Processes
Initiating
Process
Group
Pyramid
23
6
Process
Groups
Project Life Cycle
Phase Phase Phase Phase Phase
Executing Processes
Initiating
Processes
Closing
Processes
Pyramid
A WORD OF CAUTION
ALL OF THE PROCESSES AND INTERACTIONS
DO NOT APPLY TO ALL PROJECTS OR PHASES!
23
7
DO NOT APPLY TO ALL PROJECTS OR PHASES!
The project manager, along with project team,
is always responsible for determining:
1. What processes are appropriate?
2. What is the appropriate degree of rigor for
each process?
THIS IS CALLED TAILORING!
EXAMPLES: Customizing process interactions
Software development projects dependent on unique
A WORD OF CAUTION
23
8
Software development projects dependent on unique
resources define roles and responsibilities before scope
definition.
A firm whose projects find sizable outsourcing need to
describe in their planning where the work is contracted
out.
On smaller projects, involving handful of people, there
is no need for communications planning.
EXAMPLES: Customizing process interactions
On larger and complex projects, more detailed and
A WORD OF CAUTION
23
9
On larger and complex projects, more detailed and
meticulous planning is required
Risk is a big agenda and risk identification will be more
exhaustive, creating separate risk categories:
a) Quality risks, b) Technical risks,
c) Cost risks, d) Schedule risks, and
e) Managerial risks.
recap ABOUT
The five process groups we have discussed
24
0
The five process groups we have discussed
are not one time processes.
They are iterative and revisited throughout
the project life cycle as the project is refined.
recap ABOUT
Apart from entire project, each phase is also
24
1
initiated, planned, executed, controlled, and
closed.
The output of preceding phase becomes
input to the succeeding phase.
recap ABOUT
Completion of each phase allows the project
24
2
Completion of each phase allows the project
manager and Stakeholders to reanalyze the
business needs and determine whether the
project is satisfying those needs or not!
Here is another opportunity to make a go or
no-go decision.
Mapping 5 PM Process Groups to
9 Knowledge Areas
Consists of
3 slides
SLIDE 1
Process Groups
Knowledge Areas
INITIATING PLANNING EXECUTING CONTROLLING CLOSING
Project Integration
Management
Develop Project
Management
Plan
Direct and
Manage Project
Execution
Monitor & Control
Project Work
Develop
Project
Charter
Close
Project or
Phase
24
3
Plan
Execution
Perform
Integrated Change
Control
-Collect requirements
- Define Scope
- Create WBS
- Verify Scope
- Control Scope
Project Scope
Management
Project Time
Management
- Define Activities
- Sequence
Activities
- Estimate Activity
Resources
- Estimate Activity
Durations
- Develop Schedule
Control
Schedule
Charter
Phase
9 Knowledge Areas
Consists of
3 slides
SLIDE 2
Process Groups
Knowledge Areas
INITIATING PLANNING EXECUTING CONTROLLING CLOSING
Project Cost
Management
Estimate Costs
Determine budget
Cost control
Project Quality Perform
24
4
Project Quality
Management
Plan Quality
Perform
Quality
Assurance
Perform
Quality control
Project HR
Management
Develop
Human Resource
Plan
Acquire Project
Team
Develop Project
Team
Manage project
team
Project
Communications
Management
Identify
Stakeholders
Plan
Communications
Information
distribution
Manage
stakeholder
expectations
Report
Performance
9 Knowledge Areas
Consists of
3 slides
SLIDE 3
Process Groups
Knowledge Areas
INITIATING PLANNING
EXECUTING M and C
CLOSING
Project Risk
Management
Monitor
And
Control
- Plan
Risk Management
- Identify Risks
24
5
Control
Risks
- Identify Risks
- Perform Qualitative
Risk analysis
- Perform
Quantitative risk
analysis
- Plan Risk responses
Project
Procurement
Management
Plan procurements Conduct
procurements
Close
procurements
Administer
procurements
9 Knowledge Areas
From this mapping, we understand:
24
6
From this mapping, we understand:
Where the project management processes fit
into both:
1) Nine knowledge areas, and
2) Five project management process groups
Major project documents
We have three major documents on our project
24
7
We have three major documents on our project
1) Project Charter: formally authorizes project.
2) Project Scope Statement: tells what work
needs to be performed and what
deliverables need to be made.
3) Project Management Plan: tells how the
work will be done.
Project Management
INITIATING
24
8
INITIATING
PROCESS GROUP
Processes:
develop project charter
identify stakeholders
INTIATING PROCESS GROUP
PROJECT INTEGRATION MANAGEMENT
Processes borrowed from
24
9
1) Develop project charter
PROJECT INTEGRATION MANAGEMENT
PROJECT COMMUNICATIONS MANAGEMENT
2) Identify Stakeholders
Now, project management begins!
Initiating Process Group
25
0
Initiating a Project
Processes:
develop project charter
1) Developing a document that formally
25
1
1) Developing a document that formally
authorizes a project or a phase.
2) Documenting initial requirements that
that satisfy the stake holders needs
and expectations.
ESTABLISHES
25
2
ESTABLISHES
A partnership between the performing
organization and the requesting
organization (or customer in case of
external projects)!
25
3
The real project starts when there
is a chosen solution to the business need,
and the decision to invest has been made.
An approved project charter formally
initiates a project!
Question:
25
4
Question: When a project manager should be
identified and assigned?
Answer: As early as feasible, preferably while
The charter is being developed but always
prior to start of planning!
Question:
25
5
Question: Should the project manager be
involved in the development of project charter?
Answer: It is recommended that the project
manager participate in the development of the
project charter, as it provides him/her authority
to apply resources to project activities.
Question: Who authorizes the projects?
25
6
Question: Who authorizes the projects?
Answer: They are authorized by someone
external to the project! Sponsor, PMO, Portfolio
Steering Committee. They can create it or
delegate that duty to the project manager.
Note: project initiator/sponsor is a position
having funding authority!
25
7
Needs assessment
and feasibility study
in some cases
precedes initiation.
Initiation is always done
Formally.
EXCEPTION:
Internal service projects
The main areas
WHO needs this business
change?
25
8
The main areas
to
be addressed
in
Project Initiation
(clue : Who will be benefited)
WHICH solution is
recommended ?
(clue: Why is it preferred to
the alternative?)
WHAT are the benefits?
(clue: Are they real and
enforceable?)
What are estimated project
Costs and Assumptions?
25
9
The main areas
to
be addressed
in
Project Initiation
Costs and Assumptions?
(clue: high-level estimates at
this point of time).
WHAT are the significant
risks?
(clue: things which may get in
the way of success).
Once your organization recognizes a need
and decides to respond to it, you have a
Project
26
0
Project
It involves
Selecting a project and Committing
organizational resources to it.
Since every phase is also initiated, the initiation
also means authorizing the project to continue to
the next phase. But its not so simple!
The project has to support:
a) Your company's Strategic Plan,
b) Address management concerns.
26
1
b) Address management concerns.
There are many management
concerns!
You need to survive and grow in
a highly competitive market!!
But its not
so simple
You want bigger market share!!
You want better (and faster)
26
2
You want better (and faster)
return on investment!!
You want to have a nice public
perception!!
But its not
so simple
SO THAT people prefer to buy your
products, subscribe to your stocks,
consider you a market leader !
Providing best value for money!
Your organization is already
doing something:
26
3
providing certain products
and services through its
ongoing operations.
INITIATION of
a project , therefore, provides links
with your organizations
ongoing work.
But its not
so simple
Develop Project Charter process overview
INPUTS
TOOLS &
OUTPUTS
26
4
Project statement of
work
Business case
Contract (if applicable)
Enterprise
environmental factors
Organizational
process assets
INPUTS
TOOLS &
TECHNIQUES
OUTPUTS
Expert Judgment
PROJECT CHARTER
Project SOW
Develop project charter
26
5
Project SOW
Describes product or services to be
provided by the project.
For internal projects, it is given by
project initiator or sponsor.
For external projects, it is given by
external customer as part of RFP.
HERE, Project SOW indicates:
1) Business need
2) Product scope description: Product requirements
26
6
2) Product scope description: Product requirements
that project will create. Less details during
initiation, more during later processes as product
characteristics are progressively elaborated.
Product requirements must show the relation of
the product with the business need. These
requirements should be detailed enough to
support later planning.
3) Strategic plan: all projects must support organizations
strategic goals!
Strategic plan
Projects are the means by which
performing organization implements its
Project SOW indicates a:
Strategic plan:
all projects must
26
7
performing organization implements its
strategic plan.
Hence, each project you select must
support your organizations strategic plan.
ABC Industries had taken up a TV Project
because Marketing VP had wanted it.
It was neither core competence of the
company nor FITTED into its strategic plan.
The project did not get enough attention
later on and fell through.
all projects must
support the
organizations
strategic goals!
Business Case
Describes justification for investment from
business standpoint.
26
8
business standpoint.
Business need and cost-benefit analysis
contained.
Requesting organization or customer (in external
projects) write the business case.
Reviewed periodically in multi-phase projects for
benefits.
Business Case emerges from one or more of the
following:
a) Market demand
26
9
a) Market demand
b) Organizational need
c) Customer request
d) Technological advance
e) Legal requirement
f) Ecological impacts
g) Social need
Contract (if applicable)
- Contract becomes input here if the project is
27
0
- Contract becomes input here if the project is
being undertaken for an external customer.
Project Integration Management: initiation
Enterprise environmental
factors
Develop
project charter
27
1
INPUTS
factors
We must consider the
influence of all such factors
and systems on Projects
Success:
Government/ Industry
standards
Infrastructure
Develop
project charter
27
2
INPUTS
factors
Existing Human Resources
Personnel administration
(guidelines to hiring, performance
reviews, training history)
Companys work
authorization system
Enterprise
Develop
project charter
27
3
INPUTS
Market conditions
Stakeholder tolerances
Commercial databases
(standardized cost estimating data,
industry risk study information/ risk
databases)
Enterprise
Develop
project charter
27
4
INPUTS
PMIS (automated tool suite
like scheduling s/w,
configuration management
system, information collection
and distribution system, or
web interfaces to other online
systems)
Organizational process
assets
Develop
project charter
27
5
INPUTS
assets
influence of all the org.
process assets on Projects
Success:
1) Organizations Formal/
informal policies,
- procedures, plans, and
- guidelines
assets
Develop
project charter
27
6
INPUTS
assets
influence of all the org.
process assets on Projects
Success:
2) Organizations learning and
knowledge from earlier
projects
Organizational
Develop
project charter
27
7
INPUTS
Organizational
process assets
- Organizations learning and
knowledge from earlier
projects like:
Completed schedules
Risk data
Earned Value data
Organizational process assets
1) organizations processes & procedures for
27
8
conducting work
organizational standard processes
- safety & health policy
- project management policy
standard product and project life cycles
quality policies and procedures
- process audits
- improvement targets
- checklists and standardized process definitions
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9
conducting work (continued)
standardized guidelines, work instructions,
proposal evaluation criteria and performance
measurement criteria
Templates
- risk templates
- WBS templates
- project schedule network diagram templates
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0
guidelines and criteria for framing organizations
set of standard processes to meet specific needs
of the project
organization communication requirements
- specific technology available
- permitted communication media
- record retention
- security requirements
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1
project closure guidelines/ requirements
- final project audits
- project evaluations
- acceptance criteria
financial control procedures
- time reporting
- required expenditure and disbursement reviews
- accounting codes and standard contract provisions
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2
Issue and defect management procedures
- Issue and defect controls
- Issue and defect identification and resolution
- Action item tracking
Change control procedures plus steps
- Steps for modifying official company standards,
policies, plans, and procedures, or any project
documents. And how changes will be approved/ validated.
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3
Risk control procedures plus risk categories
probability definition and impact, and
probability and impact matrix
Procedures for approving and issuing work
authorizations
2) organizational corporate knowledge base for
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4
storing and retrieving information:
Process measurement database
- for collecting and making available data on processes
and products
Project files (information from earlier projects)
- info on scope, schedule, cost, and quality baselines,
performance measurement baselines, project calendars,
project schedule, network diagrams, risk registers,
planned response actions, and defined risk impact
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5
storing and retrieving information (continued):
Historical information and lessons learned
knowledge base
- Project records and documents
- All project closure information and documentation
- Information on the previous projects performance
- Information on the previous projects results
- Information on risk management efforts
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6
Issue and defect management database
- Issue and defects status
- Control information
- Issue and defects resolution and Action item results
Configuration management knowledge base
consisting of versions and baselines of
- All official company standards, policies, procedures, and
- Project documents
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7
Financial database
- Information on labor hours,
- Incurred costs
- Budgets
- Project cost overruns, if any
Develop Project Charter Process
TOOLS AND TECHNIQUES
Expert Judgment
1) Help assess inputs required to develop the charter
2) Applied to any technical and management details
Develop
project charter
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8
2) Applied to any technical and management details
3) Comprises special expertise from any group or individual
Sources:
- other units within performing organization
- consultants
- stakeholders (also customers/sponsors)
- professional/technical associations
- industry groups
Discussion on OUTPUTS
Project Charter
DOCUMENT that formally authorizes a
project
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9
project
ISSUED by a project initiator or
sponsor, external to project
organization, at a level appropriate to
project funding
EMPOWERS the project manager to
apply resources to project activities
PROJECT
CHARTER
OUTPUTS
Project Charter
AUTHORITY of project manager
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0
AUTHORITY of project manager
is particularly important when
project team comes from various
functional areas.
He/she has to deal with many
issues relating to cooperation
and performance of the team
members working on the project.
PROJECT
CHARTER
OUTPUTS
Project Charter
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1
Documents Business Needs, Current
understanding of customers needs, or the new
product, service or result that is intended to meet!
Information in the Project Charter
OUTPUTS
1. Project purpose and justification,
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2
OUTPUTS
PROJECT
CHARTER
1. Project purpose and justification,
2. Measurable project objectives and related
success criteria,
3. High-level requirements,
4. Assigned project manager and empowerment,
5. High-level project description
6. High-level risks
7. Summary level milestone schedule
Information in the Project Charter
8. Summary level budget,
OUTPUTS
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3
8. Summary level budget,
9. Project approval requirements:
a) What constitutes project success
b) Who decides project is successful
c) Who will sing off on the project
Name and authority of the sponsor or other
persons authoring the project charter.
OUTPUTS
Discussion on INITIATION
Constraints
Factor that limit project management teams
options
Examples:
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4
Examples:
1. an imposed date,
2. a predefined budget,
3. scope
4. staffing
5. specified quality
6. contractual terms
7. Project product to be socially, economically,
and environmentally sustainable (puts further
constraint on in terms of scope, time, staffing ,
and cost).
PROJECT
CHARTER
Assumptions
Things assumed to be real, true and
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5
certain for the purpose of planning.
If they do not come true?
THEY BECOME RISK
PROJECT
CHARTER
EXAMPLES OF Assumptions
While planning, you assume:
1. vendor delivery date will be
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6
1. vendor delivery date will be
honored,
2. help from other functional areas
will come on date as planned.
3. certain team members or
specialists required on your
project will be there.
PROJECT
CHARTER
You assume so many things.
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7
Must document these assumptions.
They impact all areas of planning
Are progressively elaborated as
project progresses.
PROJECT
CHARTER
During initiation, high-level
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8
assumptions are discovered and
documented.
Assumptions are monitored
throughout the project.
OUTPUTS
PROJECT
CHARTER
Sample project charter
PROJECT TITLE AND DESCRIPTION
ABC Customer Satisfaction Project
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9
ABC Customer Satisfaction Project
Recent Customer satisfaction survey has found that many of our
customers orders for mobile sets has taken the customer 8 times
longer to place order on our network than the competitors network.
The goal of this project is to examine the root causes and offer solution.
Implementation of solution will be separate project.
PROJECT MANAGER ASSIGNED AND AUTHORITY LEVEL
Vikas Chopra shall be the project manager for this project and have the
authority to select his team and determine final project budget.
Continued
Discussion on INITIATION OUTPUTS
OBJECTIVES
Complete the project no later than February 1, 2009. Spend no more than
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0
Complete the project no later than February 1, 2009. Spend no more than
INR 200,000, result in a tested plan to reduce the order time by at least
90%.
BUSINESS CASE (Business need)
This project is being undertaken to prevent further dissatisfaction of
customers with LGs offerings on net. We expect that increased
customer satisfaction will improve revenues. Developing new ideas to
satisfy customers will be an additional advantage arising from this
project.
Continued
Discussion on INITIATION OUTPUTS
PRODUCT DESCRIPTION
The project should result in specific deliverables like:
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1
The project should result in specific deliverables like:
1. The solution describing what should be changed, how much time and
cost each change will take ,and how much order placement time each
change will ensure. The proposed solution must be consented by
related departmental managers (Marketing, Quality Assurance,
Customer Care, and Support Services).
2. The document describing names of customers with whom necessary
interactions are advised for implementing the solution.
3. The Work Breakdown Structure that details the plan for completing
the project and the list of risks involved in the project.
SIGNED AND APPROVED:
Manas Banerjee, President
CASE STUDY
ABC LTD. manufactures valves for filling
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2
and controlling water level in industrial tanks. The company
ABC LTD. manufactures valves for filling
and controlling water level in industrial tanks. The company
envisioned a new valve, THE TURBO VALVE, to garner
bigger market share. The objective was to design, and
produce the new valve with higher quality and lower cost
than the competition.
ABC decided to outsource the development and
design. The RFP included:
CASE STUDY
ABC sent RFP to six companies and selected XYZ
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ABC sent RFP to six companies and selected XYZ
Designs based on lowest bid. XYZs proposal was
written by its Sales & Marketing departments, revised by
senior management but no input from industrial
designers, engineers, or anyone else who would work
on the project. XYZ had no prior experience in such
valves but quoted to grab the opportunity and expand
client base.
CASE STUDY
ABC assigned Mr. Bamish Kumar, a seasoned
design engineer, to head the project with four engineers.
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4
The team could not assemble until 5 months because of
prior project commitments. Then, industry research was
conducted. Bamish divided project into phases
and work packages and prepared a Gantt chart.
He found that the proposal had missed several critical
steps and processes and funding was underestimated.
He rewrote the proposal, cost, and schedule estimates.
CASE STUDY
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5
The design concept, work tasks, and schedules had to be
changed throughout the project!
The woes of the XYZ design team were augmented by
constant pressure from ABC on functional superiority
and low cost.
CASE STUDY
It was realized during the project that designing such a
valve needed more resources than budgeted! All the
changes led to overshooting budget 5 times and
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changes led to overshooting budget 5 times and
requesting ABC for additional funds!
Another blunder: XYZ sent a Prototype to ABC.
ABC considered Prototype to be virtually finished
product with replicable components.XYZ visualized it
to be a simple working model to display design and
functionality. Proposal didnt mention clearly what
prototype would be, and ABC expected much more.
CASE STUDY
To resolve the issue in of favor ABC, extra money
and time was spent by EICHER! FINISHED PROTOTYPE
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7
and time was spent by EICHER! FINISHED PROTOTYPE
SAW EVEN MORE TIME AND COST OVERRUNS.
SHORT-CUT APPROACH: To makeup for delay, XYZ
chose to cram project stages and executed them without
sequence. XYZ began making production-ready models
but the finished ones showed they could not be
produced.
CASE STUDY
ULTIMATELY, XYZ did make a real innovative valve!
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8
ULTIMATELY, XYZ did make a real innovative valve!
But? But, the design necessitated good deal of fresh
tooling to really produce it at ABC FACTORY!
It meant ABC would have to incur about 40% more to
manufacture than had been expressed.
CASE STUDY
ABC cancelled the contract. Work was 90%
completed. ABC is now trying to finish balance 10%
but that will be great challenge because:
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9
but that will be great challenge because:
1. Thus far, ABC has already spent twice as much
time and money on development as expected, and
still does not have a product to produce
2. Even though the development completes, the high
tooling cost will not the product to be priced low
enough to be competitive.
Lessons learned from the case study:
Project objectives should be clear and agreeable
early in advance.
Project objectives in RFP should not be too rigid to
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0
Project objectives in RFP should not be too rigid to
accommodate changing priorities.
Sufficient time should be spent by the performing
organization to define objectives.
Objectives should be adequately quantified.
Objectives should be documented enough.
Efforts of client and project team should be
coordinated properly to ensure common
understanding.
Ensure that Project has a complete and sound basis
before major commitment to the project or phase.
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1
before major commitment to the project or phase.
An adequately made project charter (contract) to act
as a base document against which the project can
assess progress, change management issues, and
ongoing viability questions.
As a minimum, it must answer following questions
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2
As a minimum, it must answer following questions
about the product of the project:
1. What the project is aiming to accomplish?
2. Why is it important to achieve?
3. Who will be involved in managing the process,
their responsibilities?
4. How and when the project will be undertaken?
Project Communications Management
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3
Initiating a Project
Processes:
the process of
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4
the process of
1) Identifying all people or organizations
impacted by the project.
2) Documenting their interests,
involvement,a and impact on project
success!
It is critical for project success to identify
please remember
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5
It is critical for project success to identify
the stakeholders early in the project!
AND
Analyze their levels of interest,
expectations, importance and influence!!
For approaching each stakeholder and
please develop a strategy
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6
For approaching each stakeholder and
determining the level and timing of
stakeholders involvement to
maximize positive influences and
minimize potential negative impacts!
Please keep reviewing this strategy during project
execution!
Due to large number of stakeholders and
please classify the stakeholders
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7
Due to large number of stakeholders and
limited time with the project manager,it
helps to classify according to:
1) Interest
2) Influence
3) Involvement
Identify stakeholders
data flow diagram
Develop
project charter
Project charter
Identify
stakeholders
Collect
Requirements
Stakeholder
Stakeholder
Register
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8
Project charter
Procurement
documents
Plan
procurements
Enterprise/
organization
factors
OPAs
stakeholders
Plan
Communications
Requirements
Plan
Quality
Identify
risks
Stakeholder
Management
Strategy
Register
Manage
Stakeholder
expectations
Identify Stakeholders process overview
INPUTS
TOOLS &
TECHNIQUES
OUTPUTS
Stakeholder Register
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9
Project Charter.
Procurement Documents
Enterprise Environmental
Factors
Organizational Process
Assets
INPUTS
Stakeholder
Analysis
Expert Judgment
Stakeholder
Management Strategy
Identify Stakeholders: Discussion on inputs
Project Charter
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0
provide information about internal and
external parties involved in and affected by
the project.
Example
Sponsor (s), customers, team members, groups and
departments,and other organizations involved in the
project, and affected by the project.
Procurement Documents
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1
If the project is the result of the procurement
activity, or based on established contract, the
parties involved in that contract are key project
stakeholders.
Note: Suppliers are also project stakeholders!
Remember this!
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2
- Organizational or company culture.
- Government or industry standards.
OPAs do help, you cant deny. See
- Stakeholder Register Templates.
- Lessons Learned from previous projects.
- Stakeholders registers from previous projects.
Do you
maintain such
OPAs ?
There are two ways to identify stakeholders
Identify Stakeholders: Discussion on techniques
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3
1. Stakeholder analysis
2. Expert judgment
Stakeholder analysis
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4
the process of
systematically gathering and analyzing
quantitative and qualitative information
TO DETERMINE WHOSE INTERESTS
should be taken into account throughout
the project!
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5
identifies
1) Interests,
2) Expectations, and
3) Influence of the stakeholders
Relates them to the purpose of the project!
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6
identifies
stakeholder relationships that can be
leveraged to build COALITIONS AND
POLITICAL PARTNERSHIPS to
enhance the projects chance of
success!
THE STEPS
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7
THE STEPS
Step 1: Identify all Potential Stakeholders.
Step 2: Identify Potential impact or support
each stakeholder could generate.
Step 3: Assess how key stakeholders are
likely to react.
ARE YOU TRAINED INTO Stakeholder Analysis?
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8
ARE YOU TRAINED INTO Stakeholder Analysis?
IF NOT, THEN THIS PROCESS WILL NOT YIELD
YOU MUCH?
MANY ARE NOT TRAINED ENOUGH ON THIS
ASPECT!!
HOW DO YOU HANDLE STEP 1?
Well, please:
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9
Well, please:
1. Identify all project stakeholders
2. Their roles, departments, interests, expectations,
and last but not the least- their influence levels!
Note: key stakeholders are easy to identify. Anyone in a
decision-making or management role. Sponsor, project
Manager, primary customer. But you must find more, not
stop at only them! Please remember!
Other stakeholders, you can identify:
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Other stakeholders, you can identify:
- BY interviewing identified stakeholders
- EXAPANDING the list until all potential
stakeholders are identified!!!
Well, please:
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1
Well, please:
1. Identify the potential impact or SUPPORT each
stakeholder can generate.
2. Classify them them to decide an APPROACH
STARTEGY!
In large stakeholder communities,
it is very important to
PRIORITIZE THE KEY STAKEHOLDERS!
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2
PRIORITIZE THE KEY STAKEHOLDERS!
WHY?
To communicate and manage
their expectations!!
Classify them
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3
Classify them
1) Power grid/interest grid
Grouping the stakeholders based on their level of
authority (POWER) and their level or concern
(INTERST) regarding project outcomes!
Classify them
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4
Classify them
2) Power influence grid
Grouping the stakeholders based on their level of
authority (POWER) and their active involvement
(INFLURNCE) in the project!
Classify the
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5
Classify the
3) Influence/impact grid
Grouping the stakeholders based on their active
involvement (INFLURNCE and their ability to
effect changes to the projects planning or
execution (IMPACT).
Classify them
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6
Classify them
4. Salience Model
Describing classes of the stakeholders based on
their power (ABILITY TO IMPOSE THEIR WILL),
urgency (NEED FOR IMMEDIATE ACTION), and
legitimacy (THEIR INVOLVEMENT IS
APPROPRIATE).
EXAMPLE: POWER/INTEREST GRID
High
A-H = Stakeholders
Keep Manage
B
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7
Power
Low
Low
Interest High
Keep
Satisfied
Manage
Closely
Keep
Informed
Monitor
(minimum effort)
A
C
D
E
H
F
Assess how key stakeholders are likely to react
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8
Assess how key stakeholders are likely to react
or respond in various situations. Then, plan
how to influence them 1) to enhance their
support, and 2) minimize potential negative
impacts!
Make Stakeholder Register and place all the info!
EXPERT JUDGMENT
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9
Used to ensure Comprehensive Identification and
Listing of Stakeholders!
Expert judgment can be taken through individual
consultations or panel format (focus group,
survey).
Identify Stakeholders: OUTPUTS
1) Stakeholder Register
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1) Stakeholder Register
2) Stakeholder Management Strategy
Identify Stakeholders: OUTPUTS
1. Identification 2. Assessment 3. Stakeholder
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1
Information Information Classification
Name, position,
location, role in
project, contact
info.
Major
requirements,
main
expectations,
potential
influence, phase
of most interest.
Internal/external,
Supporter/neutral/
resistor, etc.
Defines approach to increase the support and
Stakeholder Management Strategy
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2
Defines approach to increase the support and
minimize negative impacts of stakeholders
Elements included:
1) Key stakeholders who can significantly impact,
2) Level of participation in the project desired,
3) Stakeholder groups and their management.
Stakeholder Analysis Matrix
Common way to represent Stakeholder Management
Strategy.
Stakeholder Interests in Assessment Potential
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Stakeholder Interests in
the project
Assessment
of impact
Potential
strategies
1) For
gaining
support
2) For
reducing
obstacles
PROJECT MANAGEMENT Progresses
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4
PLANNING PROCESS GROUP
Consists of PROCESSES performed to:
1) establish TOTAL SCOPE OF THE EFFORT,
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1) establish TOTAL SCOPE OF THE EFFORT,
2) Define and refine the objectives,
3) develop the course of action required to attain
those objectives!
4) Project Management Plan and Project
documents are developed to carry out the
project.
Question: Is planning on time affair?
Answer: No, planning and documentation
are iterative and ongoing processes!
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6
WHY?
Because,
1) as more information or characteristics are
gathered and understood, additional planning
may be required.
Question: Is planning one time affair?
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7
WHY?
Because,
2) plus significant changes during the project may
trigger a need to revisit one or more planning
processes, and some of the initiating
processes.
Question: Is planning one time affair?
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8
WHY?
This progressive detailing of the project
Management plan is called Rolling Wave
Planning. This proves that planning and
documentation are iterative and ongoing
processes.
Example
For some projects, there might be little or no
identifiable risk until after significant planning
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identifiable risk until after significant planning
has been done. This would mean that time and
cost targets are overly aggressive, thus
involving considerably more risk than earlier
understood. So, additional time and cost need
to be added in the schedule and budget.
Planning
Planning Process Group
Planning a Project
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Planning a Project
Processes:
Define scope
Create WBS
Define activities
Sequence activities
Estimate activity resources
Estimate activity durations
Develop schedule
Estimate costs
Determine budget
Processes:
Plan quality
Develop HR plan
Plan communications
Plan risk management
Identify risks
Perform qualitative risk analysis
Perform quantitative risk analysis
Plan risk responses
Plan procurements
Processes:
develop project
management plan
Planning Process group
Project Management Plan and Project
Documents explore all aspects of scope, time,
cost, quality, human resource, communication,
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1
cost, quality, human resource, communication,
risk, and procurement.
Updates arising from approved changes revise
them.
Consequently, these updates provide greater
precision in schedule, costs, and resource
requirements!
Project Team should involve all appropriate
stakeholders.
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Updates arising from approved changes revise
them.
Consequently, these updates provide greater
precision in schedule, costs, and resource
requirements!
Since planning process group borrows processes from
all nine knowledge areas, we will showcase in brief
THE CONCERNED KNOWLEDGE AREA, and then
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3
THE CONCERNED KNOWLEDGE AREA, and then
discuss about the ones contributing in the planning
process group.
For example, planning begins with Collect Requirements
Process from Scope Management Knowledge Area. So,
we will briefly describe concept of Scope Management
and all its processes and then take up the ones coming in
Planning Process Group.
The Concept
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The processes required to ensure that
the project includes
ALL THE WORK REQUIRED
(and only the work required)
To
complete the project successfully!
The Concept
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5
It is primarily concerned with
DEFINING AND CONTROLLING
WHAT IS AND IS NOT INCLUDED
IN THE PROJECT!
processes
1) Collect requirements
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1) Collect requirements
2) Define scope
3) Create WBS
4) Verify Scope
5) Control scope
Process group
Please note
A separate process has not been shown for
making Scope Management Plan but this plan is
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making Scope Management Plan but this plan is
absolutely necessary!
We need it to guide us on how project scope will
be defined, documented, verified, managed,
controlled.
So, we will make it just as we enter planning in
the area of scope management!
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Collect Requirements
Knowledge Area: Scope Management
Process
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9
the process by which we define and record
stakeholders needs for meeting project
objectives.
Projects success is directly influenced
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Projects success is directly influenced
by the care taken in capturing
project and product requirements!
Project Scope Management: Collect requirements
Requirements mean
1) Quantified and documented needs and
expectations of the sponsor, customer, and
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1
expectations of the sponsor, customer, and
other stakeholders.
2) These requirements need to be elicited,
analyzed, and documented in enough details
to be measured as project execution begins!
3) Requirements become foundation of WBS!
Project Scope Management: Collect requirements
Requirements means
4) Schedule, cost, quality planning are all built
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4) Schedule, cost, quality planning are all built
upon these requirements only!
5) Requirements may be known as:
a) Project requirements (business requirements,
project management requirements, delivery
requirements, etc.).
b) Product requirements (information on technical
requirements, security requirements, performance
requirements, etc.).
INPUTS
TOOLS &
OUTPUTS
Collect requirements process
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3
Project charter
Stakeholder register
INPUTS
TOOLS &
TECHNIQUES
OUTPUTS
Interviews
Focused groups
Facilitated workshops
Group creativity
techniques
Group decision making
techniques
Questionnaires and
surveys
Observations
Prototypes
Requirements
documentation
Requirements
management plan
Requirements
traceability matrix
Project Scope Management: Collect Requirements
Discussion on Inputs
1. Project charter provides high-level project
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requirements and high-level product
description for developing detailed level
product requirements!
2. Stakeholder Register is used to identify
stakeholders who will provide details level
project and product requirements!
Project Scope Management:
Discussion on Tools & Techniques
1. Interviewing experienced project
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1. Interviewing experienced project
participants, stakeholders and subject matter
experts through prepared and spontaneous
questions to gain understanding of features
and functions of project deliverables!
Conducted on one-on-one basis but may involve
Multiple interviewers and interviewees.
2. Focus groups
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2. Focus groups
a) trainer-moderated,brings together pre-qualified
stakeholders, subject matter experts.
b) Interactive session, more conversational than
interviews.
c) PURPOSE: to learn about their expectations
and attitudes about a proposed product or
service or result!
3. Facilitated workshops
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a) Focused sessions to bring together key Cross-
Functional Stakeholders to define product
requirements!
b) Primary technique to quickly define Cross-Functional
Requirements and reconcile stakeholders differences!
c) Builds trust, fosters relationships and improves
communications.
d) Issues discovered and resolved more quickly than in
individual sessions.
Project Scope Management: Collect Requirements
JAD (Joint Application Development/Design) Sessions:
Users and software developers brought together for
improving software development process.
Facilitated workshops: Examples
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8
improving software development process.
QFD (Quality Function Deployment): in manufacturing
industry. Helps determine critical characteristics for new
product development.
Procedure: customer needs (VOC) collected, objectively
sorted and prioritized and goals are set for achieving them!
4. Group Creativity Techniques
a) Brainstorming: generate & collect multiple ideas.
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a) Brainstorming: generate & collect multiple ideas.
b) Nominal group technique: voting added to rank most
useful ideas. Enhances brainstorming.
c) Delphi: common opinion of experts anonymously.
d) Idea/mind mapping: ideas from individual brainstorming
build a map showing commonalities and differences.
Helps understand better and generate new ideas.
e) Affinity diagram: large number of ideas sorted in groups
for review and analysis.
4. Group Decision Making Techniques
a) Unanimity: everyone agrees for single course of action.
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a) Unanimity: everyone agrees for single course of action.
b) Majority: more than 50% support the idea.
useful ideas. Enhances brainstorming.
c) Plurality: even if majority not achieved, largest block
in the group decides.
d) Dictatorship: one individual forces decision on the
group.
5. Questionnaires & surveys: appropriate when broad
audience and statistical analysis needed.
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audience and statistical analysis needed.
6. Observations: seeing people in their environment.
Particularly useful for detailed processes (when people
who use the product have difficulty or are unwilling to
articulate their requirements!!
Also called Job Shadowing- external observer watches
user performing the job.
To uncover hidden requirements, a participant observer
6. Observations:
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Also called Job Shadowing- external observer watches
user performing the job.
To uncover hidden requirements, a participant observer
(who actually performs the process) can also
experience how it done!
7. Prototypes:
- Method of obtaining early feedback on requirements by
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- Method of obtaining early feedback on requirements by
providing a working model of the expected product.
- Allows stakeholders to experiment with a model of their
Final product. Removes abstractions as it is tangible.
Sufficient Requirements gathered through many feedback
cycles. Example: iterative cycles of mockup creation, user
Experimentation, feedback generation and prototype
revision.
Discussion on Outputs
1. Requirements documentation:
- describes how individual requirements meet the
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4
- describes how individual requirements meet the
business need for the project.
- Before baselining, the requirements must be fully
detailed, complete, clear, measurable, traceable and
agreeable to all stakeholders!!!
- Formats may be simple or elaborate with attachments!
sample
Requirements documentation: sample entries
1) Business need or opportunity to be seized, limitations
2) Business and project objectives for traceability
Sample
template
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3) Functional requirements (detailing business processes,
Information, and interaction with the product).
4) Non-functional requirements (level of service,
performance, compliance, security, safety, etc.).
5) Quality requirements
6) Acceptance criteria
7) Business rules (guiding principles of the organization).
Requirements documentation: sample entries
8) Impacts to other organizational areas
Sample
template
37
6
9) Impacts to other entities inside or outside performing
organization
10) Support or training requirements
11) Requirements assumptions and constraints
2. Requirements management plan:
a) describes how requirements will be analyzed,
37
7
a) describes how requirements will be analyzed,
documented and managed throughout the project!
b) Project manager must decide approach how
how phase to phase requirements relationship will be
maintained!
c) Entries in requirements management plan largely
depend on such relationship!
Requirements management plan: sample entries
a) How requirements activities will be planned, monitored,
Sample
template
37
8
a) How requirements activities will be planned, monitored,
and reported!
b) How configuration management activities will be
initiated, how impacts will be evaluated, how changes
will be traced, tracked and informed!
c) Authorization levels to approve changes!
Requirements management plan: sample entries
d) Requirements prioritization process
Sample
template
37
9
d) Requirements prioritization process
e) Product metrics to be used and its rationale
f) Traceability structure (which requirements attributes
will be captured on traceability matrix and to which
project documents requirements will be traced).
3. Requirements traceability matrix:
a) A table that links requirements to their origin and traces
38
0
a) A table that links requirements to their origin and traces
them throughout the project.
b) Ensures each requirement adds to business value (by
linking it to the business and project objectives).
c) Ensures requirements approved in the requirement doc
are delivered at the completion of project.
RTM traces requirements to
a) Business need, opportunities objectives, and
goals!
38
1
goals!
b) Project objectives
c) Project scope/WBS deliverables
d) Product design
e) Product development
f) Test strategies and test scenarios
g) High level requirements to detailed level ones
RTM contains requirements attributes:
a) Unique identifier!
b) Textual description
38
2
b) Textual description
c) Rationale
d) Owner
e) Source
f) Version
g) Current status (added, deleted, approved, etc)
h) Date of completion
i) Additional (stability, complexity, acceptance criteria).
Define Scope
38
3
Define Scope
Define Scope
Process to prepare a detailed description of
project and product!
38
4
project and product!
Note: preparation of a detailed Project Scope
Statement is critical to project success
The project scope statement builds upon the
major deliverables, assumptions, and
constraints that are are documented during
Project Initiation!
Define Scope
Please note
During planning, the project scope statement is
38
5
During planning, the project scope statement is
defined with greater specificity as we come to
know more information about the project.
Example: existing risks, assumptions, and
constraints are analyzed for completeness.
additional risks, assumptions, and constraints
are added as necessary!
Define Scope
Importance of Scope statement!
1) describes in details project deliverables and
38
6
1) describes in details project deliverables and
the work needed to produce these deliverables!
2) develops common understanding among
stakeholders!
3) helps team conduct more detailed planning
4) guides teams work during execution!
Inputs-Tools-Outputs
Inputs outputs
Define Scope
38
7
Inputs outputs
Tools and Techniques
1. Product Analysis
2. Alternative Identification
3. Expert Judgment
1. Project scope
statement
2. Project document
UPDATES
1. Project charter
2. Requirements
documentation
3. Organizational
process assets
1) Project charter
High-level project description and
Define Scope process: Inputs
38
8
High-level project description and
product
characteristics and project approval
requirements mentioned in the charter,
are used to develop scope statement.
2) Requirements documentation
Helps development of scope statement.
3) Organizational process assets
Define Scope process: Inputs
38
9
3) Organizational process assets
- Provides policies, templates
procedures
- Historical information
- Lessons learned
1) Product analysis
Helps translate high-level product
Define Scope: Tools & Techniques
39
0
Helps translate high-level product
descriptions into tangible deliverables.
Includes techniques like product breakdown,
systems analysis, systems engineering, value
analysis, and function analysis.
2) Alternative identification
techniques to find out alternative, better
39
1
techniques to find out alternative, better
approaches for executing and performing the
work of the project! General management
techniques:
Brainstorming
Lateral thinking
Pair-wise comparison, etc.
3) Expert judgment
Used in developing scope statement
39
2
4) Facilitated workshops
Project scope statement
1) Describes, in detail, the projects
Define Scope: Outputs
1. Project scope
statement
2. Project document
UPDATES
39
3
1) Describes, in detail, the projects
deliverables,
2) Develops common understanding of the
project scope among stakeholders,
3) Contains explicit SCOPE EXCLUSIONS
that can help in managing stakeholder
expectations,
4) Enables team to perform more detailed
39
4
4) Enables team to perform more detailed
planning,
5) Guides the project team during
execution, and
6) Acts as baseline for EVALUATING
changes or additional work contained or
outside the project boundaries!
Project scope statement contains: 6 items
product scope description
template
39
5
product scope description
progressively elaborates characteristics of the
product/service/result described in the charter and
requirements documentation.
product acceptance criteria
defines the process and criteria for accepting
completed product.
template
product deliverables
39
6
product deliverables
product deliverables include product of the project
and ancillary results, such as project management
reports and documentation.
project exclusions
explicitly stating what is out of scope for the project
for properly managing stakeholder expectations.
template
project constraints
39
7
project constraints
specified, such as a predetermined budget, imposed
dates, schedule milestones, contractual provisions
(if project being done under contract). Note:
Constraints may also be listed in a separate log.
project assumptions
assumptions for project scope and potential impact.
May also be noted in a separate log.
Project document updates
Following documents may be updated:
1. Project scope
statement
2. Project document
UPDATES
39
8
stakeholder register
requirements documentation
requirements traceability matrix
CREATE WBS
39
9
CREATE WBS
Knowledge Area: Project Scope Management
CREATE WBS
Process of subdividing project deliverables and
40
0
Process of subdividing project deliverables and
project work into more manageable components.
What is WBS?
A deliverable-oriented hierarchical decomposition
of work to be executed by the project team to:
- create required deliverables
- accomplish project objectives
WBS
WBS organizes and defines the total scope and
40
1
WBS organizes and defines the total scope and
represents specified in the current approved
Scope Statement!
What is a work package?
Lowest level of WBS. A work package can be
scheduled, cost estimated, monitored, and
controlled.
Create WBS
Creating WBS
WBS
40
2
WBS
A deliverable-oriented
hierarchical decomposition
of project work:
to achieve
1. PROJECT OBJECTIVES
2. PRODUCE NEEDED
DELIVERABLES
to organize and define
TOTAL PROJECT SCOPE
Work outside WBS is outside
the scope of the project
Create WBS
Creating WBS
WBS
Each descending level provides
40
3
Each descending level provides
increasingly detailed definition
of project work
Planned work at lowest level
WBS Components (work package)
is:
- Scheduled
- Cost estimated
- Monitored
- Controlled
Helps stakeholders view
Project Deliverables
Create WBS
40
4
PROCESS OF SUBDIVIDING
MAJOR PROJECT DELIVERABLES
(AS IDENTIFIED IN SCOPE STATEMENT)
into
SMALLER, MORE MANAGEABLE
COMPONENTS UPTO
WORK PACKAGE LEVEL
Create WBS
40
5
PURPOSE
1. IMPROVES accuracy of time, cost, and
resource estimation
2. DEFINES a baseline for measuring and
controlling performance!
3. FACILITATES unambiguous responsibility
assignments!
Create WBS
40
6
DELIVERABLES
FINAL DELIVERABLE (external deliverable)
To be delivered to the customer
Subject to customer/ sponsor approval
BASED ON PREDEFINED ACCEPTANCE CRITERIA
Create WBS
40
7
DELIVERABLES
ORGANIZATIONAL DELIVERABLE
EXPECTED BY SPONSOR/ PERFORMING ORGANIZATION
By product of performing project
(example: trained engineers, etc.)
Create WBS
40
8
DELIVERABLES
PROJECT MANAGEMENT DELIVERABLE
FOR SUCCESSFUL MANAGEMENT OF THE PROJECT
(PROJECT CHARTER, SCOPE STATEMENT,
WBS, SCHEDULE,
BUDGET, STATUS REPORTS, ETC.)
Create WBS
40
9
DELIVERABLES
INTERIM DELIVERABLE
CREATED AS PART OF PRODUCT DEVELOPMENT LIFE CYCLE/
PROJECT MANAGEMENT LIFE CYCLE
( TO ENABLE DEVELOPMENT OF FINAL DELIVERABLES)
Create WBS Sample deliverable chain
41
0
Project
Start
Project management deliverable
Interim
deliverable
Interim
deliverable
Interim
deliverable
Interim
deliverable
Organizational
deliverable
FINAL
deliverable
FINAL
deliverable
CUSTOMER
Create WBS
DELIVERABLES ARE COMPLETE ONLY WHEN ACCEPTED
HANDS HANDS ACCEPTED
41
1
Interim
deliverable
Interim
deliverable
FINAL
deliverable
HANDS
OFF
HANDS
OFF
INSPECTED INSPECTED
ACCEPTED
IF
NOT OK?
IF
NOT OK?
REWORK
REWORK
Create WBS
Increases Causes
41
2
Increases final project cost due to inevitable changes that spoil project rhythm
Increases
Project Time
IMPACT OF
POOR WBS
Causes
Rework
Lowers
productivity
Lowers
Morale
of
workforce
Create WBS process overview
41
3
Organizational
process assets
Scope Statement
Requirements
documentation
INPUTS
TOOLS &
TECHNIQUES
Decomposition
OUTPUTS
Work Breakdown
Structure
WBS dictionary
Scope baseline
Project document
updates
ILLUSTRATIVE WBS Template (for Defense Material Items)
Aircraft
System
Project
Test &
Training Data
Air
Support
Facilities
41
4
Project
Management
Test &
Evaluation
Training Data
Air
Vehicle
Support
Equipment
Facilities
Systems
Engineering
Management
Supporting
PM Activities
Technical
Orders
Equipment
Training
Facilities
Training
Services
Training
Engineering
Data
Management
Data
Intermediate
Level
SE
Organizational
Level
SE
Depot
Level SE
Base
Buildings
Maintenance
Facility
Mock-ups
Operational
Test
Developmental
Test
Test
Airframe Engine
Communication
system
Navigation
system
Fire control
system
Decomposition
process of breaking down major
project deliverables or sub-deliverables
into smaller, manageable components
Create WBS
41
5
into smaller, manageable components
until the they are defined to the work
package level.
WORK PACKAGE LEVEL is
the point at which cost, duration, and
resources can be reliably estimated,
and supports later development project
of management activities.
Performing decomposition
KEY POINTS
Create WBS
41
6
1. Different deliverables may require
different levels of decomposition to
arrive at a work package stage:
a) SOME deliverables require decomposition
to the next level only.
b) OTHERS require decomposition to more
levels.
KEY POINTS
Create WBS
41
7
2. Decomposition of work to lower
levels of details ENHANCES the
ability:
- to plan
- to manage
- to control
THE WORK
KEY POINTS
Create WBS
41
8
TOOLS &
TECHNIQUES
Decomposition
Beware of excessive decomposition
Nonproductive
management
effort
Inefficient
Use of
Resources
Decreased
Work
Efficiency
Balance between too little and too much
KEY POINTS
Create WBS
41
9
3. The level of detail for work packages
varies with:
project size
project complexity
4. Decomposition is difficult for a
deliverable or subproject that will be
produced FAR INTO THE FUTURE!
TOOLS &
TECHNIQUES
Decomposition
KEY POINTS
Create WBS
42
0
5. Before developing details of the
WBS, the project management team
must wait until the deliverable or
subproject is CLARIFIED!
THIS IS CALLED ROLLING WAVE
PLANNING
TOOLS &
TECHNIQUES
Decomposition
KEY POINTS
Create WBS
42
1
6. While performing decomposition,
think through entire project.
Think deliverables.
Think with the end in mind.
Think through the production of
deliverables.
Have A VISION OF FINAL PRODUCT
formulated in your mind.
TOOLS &
TECHNIQUES
Decomposition
PERFORMING DECOMPOSITION
Create WBS
42
2
TOOLS &
TECHNIQUES
Decomposition
Mastering it is critical
to
Proper Scope Definition"
THE STEPS
Create WBS
42
3
THE STEPS
STEP ONE
Identify major deliverables (including
project management deliverables)
and associated work by analyzing
detailed project statement.
TOOLS &
TECHNIQUES
Decomposition
Expert
Judgment
Helps
identify
ALL THE WORK
(including Project
Management Deliverables,
Contracted Deliverables)
THE STEPS
STEP TWO
Structure and organize WBS.
Create WBS
42
4
Structure and organize WBS.
Major deliverables must correspond the
way project will be organized in reality.
It may take various forms:
- Using major deliverables and subprojects as
level 1
- Using subprojects (external to project team)
- Using phases of the project life cycle as level 1
- Using different approaches within each branch
of WBS
TOOLS &
TECHNIQUES
Decomposition
PERFORMING DECOMPOSITION: slide A
Using major deliverables and subprojects as level 1
Using subprojects (external to project team)
Project
Phase 1 Phase 2 Deliverable 3 Subproject n Subproject 4
42
5
Deliverable 2.2 Deliverable 2.1 Deliverable 2.3
Deliverable 2.2.2 Deliverable 2.2.1
Work Package
2.2.1.1
Work Package
2.2.1.2
Work Package
2.2.1.3
Subproject 2.2.2.1
Subproject 2.2.2.2
Work Package
2.2.2.2.1
Work Package
2.2.2.2.2
Work Package
3.1
Work Package
3.2
Work Package
3.3
Work Package
3.4
Deliverable 4.1 Deliverable 4.m
Deliverable 4.1.1 Deliverable 4.1.2 Deliverable 4.1.x
Work Package
4.1.2.1
Work Package
4.1.2.2
Work Package
4.1.2.3
PERFORMING DECOMPOSITION: slide B
Using phases of the project life cycle as level 1
Software Product
Release 5.0
Product
Requirements
Detail
Design
Construct
INTEGRATION &
TEST
Project
Management
42
6
Requirements Design
Construct
TEST
Management
PLANNING
MEETINGS
ADMINISTRATION
SOFTWARE
USER
Documentation
Training Program
Materials
SOFTWARE SOFTWARE
USER
Documentation
Training Program
Materials
Training Program
Materials
USER
Documentation
SOFTWARE
USER
Documentation
Training Program
Materials
Aircraft
System
Project
Test &
Training Data
Air
Support
Facilities
PERFORMING DECOMPOSITION: slide C
Using different approaches within each branch of WBS
42
7
Project
Management
Test &
Evaluation
Training Data
Air
Vehicle
Support
Equipment
Facilities
Systems
Engineering
Management
Supporting
PM Activities
Technical
Orders
Equipment
Training
Facilities
Training
Services
Training
Engineering
Data
Management
Data
Intermediate
Level
SE
Organizational
Level
SE
Depot
Level SE
Base
Buildings
Maintenance
Facility
Mock-ups
Operational
Test
Developmental
Test
Test
Airframe Engine
Communication
system
Navigation
system
Fire control
system
THE STEPS
STEP THREE
Create WBS
42
8
STEP THREE
Decompose each upper WBS level
deliverable into its fundamental
components.
These components are defined in terms
of how the work of the project will
actually be accomplished, performed,
and managed.
The components of WBS represent
verifiable, products, results, or
services.
TOOLS &
TECHNIQUES
Decomposition
THE STEPS
STEP THREE (CONTINUED)
Create WBS
42
9
STEP THREE (CONTINUED)
Now, the project team should judge if it is
possible to adequately estimate time and
cost if at this level of decomposition
(different deliverables may require
different levels of decomposition).
If yes, then decomposition is complete,
but before treating it final, you must put it
to pass test for correctness of
decomposition as detailed in step FIVE.
TOOLS &
TECHNIQUES
Decomposition
THE STEPS
STEP FOUR
Develop and assign identification codes to
Create WBS
43
0
Develop and assign identification codes to
each component of WBS (a unique identifier):
1) generally a number associated with the
organizations financial system.
2) help hierarchical summation of costs
and resources, and also help tracking
them.
3) known as code of accounts or chart of
accounts.
TOOLS &
TECHNIQUES
Decomposition
THE STEPS
Create WBS
43
1
STEP FIVE
CORRECTNESS OF DECOMPOSITION
This is a very important step!
TOOLS &
TECHNIQUES
Decomposition
THE STEPS
STEP FIVE
43
2
please check:
1. Whether each component (work
package) can be accurately budgeted,
scheduled, and assigned to the
concerned person, team, or department
responsible for its successful
completion?
If no, then you need to make necessary
revisions to ensure proper management
control.
TOOLS &
TECHNIQUES
Decomposition
THE STEPS
STEP FIVE
43
3
STEP FIVE
TESTING CORRECTNESS
OF DECOMPOSITION
2. Whether decomposition of each
deliverable is sufficient for its
successful completion?
If no, then you should add, delete, or
refine the components.
TOOLS &
TECHNIQUES
Decomposition
WBS
Congratulations!
You have done great job!
OUTPUTS
43
4
You have done great job!
You have mastered the art of making WBS.
WORK BREAKDOWN STRCUTURE
a deliverable-oriented grouping of project
components that organizes and defines the
total scope of the project.
Work Breakdown
Structure
WBS dictionary
Scope baseline
Project document
updates
WBS
IS THE FOUNDATION upon
OUTPUTS
43
5
which project is built.
ALL planning and controlling
depends on WBS
Work Breakdown
Structure
WBS dictionary
Scope baseline
Project document
updates
CHARACTERISTICS OF WBS
OUTPUTS
43
6
GRAPHICAL PICTURE of the
hierarchy of the project.
VISUALIZES the entire
project.
Work Breakdown
Structure
WBS dictionary
Scope baseline
Project document
updates
- Each descending level
progressively elaborates the
OUTPUTS
43
7
progressively elaborates the
deliverables into their detailed
components.
- Serves as scope baseline.
Identifies all work to be
performed. Work not in WBS
is outside the project scope.
Work Breakdown
Structure
WBS dictionary
Scope baseline
Project document
updates
( CONTINUED)
- Creates a common understanding
OUTPUTS
43
8
- Creates a common understanding
of project scope among the
stakeholders.
- Unstructured list of activities does
not form WBS.
- Can be used as template for other
projects.
Work Breakdown
Structure
WBS dictionary
Scope baseline
Project document
updates
(continued)
BREAKS DOWN the project work
into work packages that
OUTPUTS
43
9
into work packages that
1) Can be realistically estimated
2) Can be completed quickly
3) Have no logic for further
division
4) Can be completed without
interruption
5) Have meaningful conclusion
and deliverable.
Work Breakdown
Structure
WBS dictionary
Scope baseline
Project document
updates
(continued)
OUTPUTS
44
0
- CREATED with help of the
team
- HELPS prevent changes and
work slipping through the
cracks
Work Breakdown
Structure
WBS dictionary
Scope baseline
Project document
updates
(continued)
- Gets team buy-in and builds the
OUTPUTS
44
1
- Gets team buy-in and builds the
team
- Determines proof of need for
staff, cost and time
- Facilitates communication and
cooperation between and
among the stakeholders
Work Breakdown
Structure
WBS dictionary
Scope baseline
Project document
updates
(continued)
- Each element at each level of the WBS is
assigned a unique identifier.
OUTPUTS
44
2
assigned a unique identifier.
- This unique identifier is generally a
number associated with the
organizations financial system.
- These identifiers help hierarchical
summation of costs and resources, and
also help tracking them.
- These identifiers are known as code of
accounts or chart of accounts.
Work Breakdown
Structure
WBS dictionary
Scope baseline
Project document
updates
Some project managers choose
to note milestones on their WBS.
OUTPUTS
44
3
to note milestones on their WBS.
A milestone is a major
accomplishment in a project.
EXAMPLE: Completion of a deliverable
Milestones serve as check points to
determine progress.
IN MOST CASES, higher levels of
WBS can be flagged as milestones.
Work Breakdown
Structure
WBS dictionary
Scope baseline
Project document
updates
(continued)
The items at the lowest level of
OUTPUTS
44
4
The items at the lowest level of
WBS are called Work Packages.
Work packages can be easily
assigned to individuals, with clear
accountability and reasonability
for completing the assignment.
Work Breakdown
Structure
WBS dictionary
Scope baseline
Project document
updates
(continued)
Work packages may be
44
5
Work packages may be
subdivided in a subproject
work breakdown structure
when some scope of work
is assigned to another
organization
COST ACTIVITY
Create WBS
44
6
WBS
COST
ESTIMATING
COST
BUDGETING
ACTIVITY
DEFINITION
RESOURCE
PLANNING
Risk management planning
WBS dictionary
OUTPUTS
44
7
WBS DICTIONARY
(COMPANION DOCUMENT TO WBS)
DETAILED CONTENTS OF WBS components,
including work packages and control accounts.
For each component:
1. A code of account identifier
2. SOW
3. Responsible organization
4. List of schedule milestones
5. Contract information
Work Breakdown
Structure
WBS dictionary
Scope baseline
Project document
updates
WBS dictionary
(continued)
WBS DICTIONARY
OUTPUTS
44
8
WBS DICTIONARY
For each component:
6. Quality requirements
7. Technical references ( facilitate work performance)
8. List of schedule milestones
9. Charge number for a control account
Work Breakdown
Structure
WBS dictionary
Scope baseline
Project document
updates
WBS dictionary
(continued)
WBS DICTIONARY
Create WBS
OUTPUTS
44
9
WBS DICTIONARY
For a work package:
10. List of schedule activities
11. Needed resources
12. Cost estimate
Work Breakdown
Structure
WBS dictionary
Scope baseline
Project document
updates
WBS dictionary
(continued)
OUTPUTS
45
0
WBS DICTIONARY
EACH WBS COMPONENT
CROSS-REFERENCED
TO
OTHER WBS COMPONENTS
Work Breakdown
Structure
WBS dictionary
Scope baseline
Project document
updates
SAMPLE
WBS
SAMPLE
WBS
GLASS PLANT
PROJECT
45
1
EARLIER
PHASES
DESIGN
PHASE
CONSTRUCTION
PHASE
LATER
PHASES
PROJECT
MANAGEMENT
CIVIL
DRAWINGS
Architectural
Drawings
Structural
Drawings
Mechanical l
Drawings
Electrical
Drawings
Instrumentation
Drawings
CIVIL
CONSTRUCTION
STRCUTURAL
CONSTRUCTION
MECHANICAL
WORK
ELECTRICAL
WORK
INSTRUMENTATION
WORK
PROCESS
COMPUTERS/EQPTS.
PLANNING
MEETING
ADMINISTRATION
SAMPLE
WBS
SAMPLE
WBS
Toy project
45
2
REQUIREMENTS
DEFINITION
DESIGN
SPECIFICATIONS
PROGRAM
MODULES
PROJECT
MANAGEMENT
GAME
REQUIREMENTS
SOFTWARE
REQUIREMENTS
DEFINE
CHARACTERS
DETERMINE
LANGUAGE
DEFINE
SYSTEMS
SOFTWARE
DESIGN
HARDWARE
DESIGN
DESIGN
SCREENS
DESIGN
USE CASES
DESIGN
SPEAKERS
DESIGN
CASE
DEFINE
INSTRUMENTS
CODE
REQUIREMENTS
TESTING
REQUIREMENTS
DESIGN
MODULE 1
PROGRAM
MODULE 1
DESIGN
UNIT TEST
DESIGN
SYSTEM TEST
SAMPLE
WBS
SAMPLE
WBS
OS ROLLOUT
45
3
TRAINING TESTING ROLL OUT
PROJECT
MANAGEMENT
DEVELPOMENT
COURSEWARE
WBT
HANDOUTS
TUTORIALS
PLANNING
SCENARIO
SIMULATIONS
PILOTS
LAB
PLANNING
MEETING
ADMINISTRATION
DOCUMENTATION
IT
DEPARTMENT
SALES
AAs
EDUCATION
HUMAN
RESOURCE
ACCOUNTING
COURSEWARE
ISSUES
KNOWLEDGE
MANAGEMENT
VERSIONING
OPERATIONS
SAMPLE
WBS
SAMPLE
WBS
ABC CARGO
LOGON PROJECT
BASIC
DESIGN (H)
HARDWARE FABRICATION
SITE
OPERATIONS
Project
Management
PURCHASE
SOFTWARE
SPECS (L)
45
4
DESIGN (H) OPERATIONS Management
DESIGN
(J)
DRAWINGS
(K)
PART B
DRAWINGS
(P)
FINAL
INSTALLATION
(Y)
TEST
(Z)
SOFTWARE
PART A
DESIGN
(I)
DRAWINGS
(O)
SPECS (L)
ASSEMBLY
(U)
PART A
TEST
(W)
ASSEMBLY
(V)
TEST
(X)
PART B
PURCHASE
(N)
DELIVERY
(S)
PURCHASE
(M)
DELIVERY
(R)
PURCHASE
(Q)
DELIVERY
(T)
WORK
PAKCAGES
(H)
through
(Z)
Scope baseline
Scope baseline consists of three
Documents:
OUTPUTS
45
5
Documents:
1) Scope statement
2) WBS
3) WBS dictionary
Work Breakdown
Structure
WBS dictionary
Scope baseline
Project document
updates
This baseline will be used to
measure our scope performance!
If approved change requests result
from this process, then the
OUTPUTS
45
6
from this process, then the
requirements document is updated
to reflect these approved changes.
Work Breakdown
Structure
WBS dictionary
Scope baseline
Project document
updates
After planning in the area of scope, we talk
about planning in the area of time.
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7
about planning in the area of time.
The result of planning in the area of time gives
us schedule baseline.
First we will have a brief on time
management and then we will see all the
processes helping us to make a realistic and
dependable schedule!
processes
1) Define activities
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8
1) Define activities
2) Sequence activities
3) Estimate activity resources
4) Estimate activity durations
5) Develop schedule
6) Control schedule
Planning
Process
Group
Process group
Purpose?
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9
Purpose?
Timely completion
of the project.
Please note
Some practitioners distinguish the printed project
46
0
schedule from the schedule data and calculations
to make schedule- by referring to the scheduling
engine populated with project data as schedule
model!
But in general practice both are referred as
Schedule! So, we will use the term schedule
Please note
On some projects, smaller in scope, all schedule
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1
On some projects, smaller in scope, all schedule
planning activities are so tightly linked that they
are taken to be one single process- so that
These can be done by a person in short time!
Please note
No process has been mentioned for making
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2
No process has been mentioned for making
schedule management plan but it is necessary.
So, we will presume that as we enter time
management, we make a schedule management
plan that:
a) Selects a scheduling methodology, a tool
scheduling tool (generally PM Software).
Please note
A scheduling methodology defines the rules
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3
A scheduling methodology defines the rules
and approaches for the scheduling process.
Examples: 1) critical path method
2) critical chain method.
b) Sets a criteria for developing and controlling
the schedule.
It is a subsidiary plan of project management plan
Please note
Schedule Management Plan is a subsidiary plan
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4
Schedule Management Plan is a subsidiary plan
of project management plan, includes control
thresholds.
It may be formal or informal, highly detailed or
broadly framed, based on the needs of the
project.
Please note
The finalized and schedule is called schedule
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5
The finalized and schedule is called schedule
baseline that will be used to start and finish
activities and also used to monitor schedule
performance to ensure timely completion of the
project!
What produces schedule?
Answer:
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6
Answer:
1) Outputs of time management planning
processes,
2) Scheduling methodology,
3) Scheduling tool
Process of
Define Activities
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7
Process of
Identifying the specific actions to be performed
to produce project deliverables at the lowest
level in WBS (work packages).
Therefore we decompose work packages into
activities needed to complete them!
Activities
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8
Provide a basis for estimating, scheduling,
executing, and monitoring and controlling the
project work.
We should define and plan activities in order to
achieve project objectives.
IMPACT OF ACTIVITIES ON
Activities
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9
IMPACT OF ACTIVITIES ON
PROJECT OBJECTIVES
profound impact because:
Activities consume resources, time, produce
Deliverables,
and determine quality
Define Activities process overview
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0
Scope baseline
Enterprise
assets
INPUTS
TOOLS &
TECHNIQUES
Decomposition
Templates
Rolling wave planning
Expert judgment
OUTPUTS
Activity list
Activity attributes
Milestone list
1) Scope baseline (Scope Statement WBS and
WBS dictionary)
Define Activities-Inputs
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1
Provides us information on
- Project deliverables
- Constraints (schedule milestones with imposed
completion dates).
- Assumptions (work hour per week, time of the
year that the construction work will be done)
WBS: MAIN INPUT
The work packages from WBS are decomposed
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2
The work packages from WBS are decomposed
to arrive at the required activities to be performed
on the project.
WBS dictionary
Provide work package descriptions that guide
development of activities for each work package
2) Enterprise Environmental Factors That can be
considered here include:
- Project Management Information System (PMIS)
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3
- Project Management Information System (PMIS)
3) Organizational Process Assets
- formal/informal activity-related policies,
procedures and guidelines
- historical information on activity list used by
similar previous projects.
DECOMPOSITION
The work packages are subdivided
into smaller and more manageable
TOOLS &
Define Activities
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4
into smaller and more manageable
components (schedule activities).
The process of decomposition is the
same as we discussed during create
WBS, except that the output in this
case is activities instead of
deliverables.
TOOLS &
TECHNIQUES
Decomposition
Templates
Expert judgment
The WBS, WBS dictionary, and activity list
can be developed either sequentially or
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5
concurrently.
Involving team members can lead to better
and more accurate results!
TEMPLATES
an activity list or a portion of an activity list
Define Activities
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6
an activity list or a portion of an activity list
from a previous project. Related activity
attributes info in the templates also helps.
Templates can help identify typical
schedule milestones!
Schedule activities exist at various
levels of detail in the project life
TOOLS &
Define Activities
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7
levels of detail in the project life
cycle. More detailed for work
packages to be accomplished in the
near term. They are less detailed for
the ones to be performed far in the
future. This leads to progressive
detailing.During strategic planning,
activities kept a at milestone level due
to little information.
TOOLS &
TECHNIQUES
Decomposition
Templates
Rolling wave
planning
Expert judgment
Planning component
TOOLS &
Rolling wave planning is
progressive elaboration
Define Activities
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8
TOOLS &
TECHNIQUES
Decomposition
Templates
Rolling wave
planning
Expert judgment
Planning component
progressive elaboration
planning. Work to be done in
near term is planned in details
at lower level of WBS. And the
one that is to be done far in
future is planned at higher
levels in WBS.
Expert judgment
Project team members/other
Experts (experienced and skilled
TOOLS &
Define Activities
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9
Experts (experienced and skilled
in developing detailed scope
statements, WBS and
schedules) provide expertise in
defining activities.
TOOLS &
TECHNIQUES
Decomposition
Templates
Rolling wave
planning
Expert judgment
Planning component
Define Activities process: Outputs
ACTIVITY LIST
Consists of all the schedule activities to be
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0
Consists of all the schedule activities to be
performed to complete the project.
Includes the activity identifier and a scope of
work description for each activity in sufficient
detail to help team members understand what
work is required to be accomplished!
Activity attributes
Extend the description of each activity by
identifying multiple components associated with
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1
identifying multiple components associated with
each activity.
Please note: components for each activity evolve
over time. During initial stages of the project they
include: activity ID, WBS ID, and activity name.
Activity attributes
When completed they may include:
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2
1) activity codes, activity descriptions,
2) predecessor, successor, logical relationships,
3) leads and lags,
4) resource requirements,
5) imposed dates,
6) Constraints, and assumptions.
Question: What is the use of activity attributes?
Answer:
1) Used to identify the person responsible,
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3
1) Used to identify the person responsible,
geographical area, and activity type such as
level of effort (LOE), discrete effort, and
apportioned effort.
2) Used for schedule development.
3) Used for selecting, sorting, ordering in various
ways within reports.
Activity attributes
Identify attributes associated with each schedule activity:
1) Activity identifier
template
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4
1) Activity identifier
2) Activity codes
3) Activity description
4) Predecessor/successor activities
5) Logical relationships
6) Leads and lags
7) Resource requirements
8) Imposed dates, constraints, assumptions
Activity attributes
Activity attributes also include:
8) Person responsible for the work
OUTPUTS
Define Activities
template
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5
8) Person responsible for the work
9) Geographical area/place of work
10) Schedule activity type like level of
effort (LOE), discrete effort, and
apportioned effort.
Activity list
Activity attributes
Milestone list
Milestone list
Identifies all milestones and indicates:
- Mandatory milestones (in contract)
OUTPUTS
Define Activities
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6
- Mandatory milestones (in contract)
- Optional milestones (as per
project requirements/historical
information)
Milestones list is a component of
project management plan
Activity list
Activity attributes
Milestone list
Milestones are used in
schedule model.
Sequence Activities
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7
IDENTIFYING AND DOCUMENTING
INTERACTIVITY LOGICAL RELATIONSHIPS
Among schedule activities
FOR DEVELOPMENT OF
A REALISTIC AND ATTAINABLE SCHEDULE
LATER
Sequence Activities
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8
The schedule activities can be
logically sequenced with proper
precedence relationships
and leads and lags
for developing an achievable
and realistic schedule later.
Sequence Activities
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9
Feeling uneasy about sequencing the whole host of
project activities?
Dont worry, you dont have to do it all manually!
You can choose to:
Use Project management software
Do it by manual method
Or use combination of both
Sequence Activities process overview
INPUTS TOOLS &
OUTPUTS
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0
Activity list
Activity attributes
Milestone list
assets
INPUTS TOOLS &
TECHNIQUES
Precedence
diagramming
method (PDM)
schedule network
templates
Dependency
determination
Applying leads and
lags
OUTPUTS
Project Schedule
Network Diagrams
Project document
updates
provides product scope description that
Sequence
Activities
process:
INPUTS
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1
provides product scope description that
contains:
Product characteristics that have direct
impact on activity sequencing.
Examples:
1) Physical layout of the facility to be built.
2) Subsystem interfaces on a software project.
no doubt these effects are
Sequence
Activities
process:
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2
no doubt these effects are
apparent in the activity
list, but product scope
description is reviewed for
ensuring accuracy.
process:
INPUTS
Activity list is obviously the main input.
Activity attributes may describe a necessary
Sequence
Activities
process:
INPUTS
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3
Activity attributes may describe a necessary
sequence of activities or defined predecessor or
successor relationships.
Milestone list helps sequence with regard to meeting
milestones.
Organizational process assets provide scheduling
methodology data from project files.
Precedence diagramming method (PDM)
1) Used in Critical Path Methodology (CPM).
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4
1) Used in Critical Path Methodology (CPM).
2) Shows activities in rectangle boxes linked by
arrows showing dependencies.
3) These boxes are called nodes.
4) Therefore, this technique is also termed as
activity-on-node (AON).
5) Most software programs use it these days.
Precedence diagramming method (PDM)
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5
START
D E
B
G H C
F A
END
ACTIVITY DEPENDENCY
Start
D Start
A Start
F D, A
E D
G F, E
B F
H G
C H
End C, B
PDMis defined by four types
of precedence relationships:
FS network (AOA)
Precludes those activities which
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6
of precedence relationships:
Finish to start (FS)
Finish to finish (FF)
Start to start (SS)
Start to finish (SF)
Precludes those activities which
can be started when their
predecessors are partially complete.
PDM
Allows for various situations of
interactivity relationships.
It also allows for TIME LAGS in
these relationships:
- Lag between two starts
- Lag between two finishes, or
- Lag between a start and a finish
PDM
Finish to Start
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7
Finish to start
The successor activity
can begin only when
predecessor activity
completes.
This is the most
commonly used
relationship.
A B
Finish to Start
Furniture
move-in
Employee
move-in
PDM
Finish to Finish
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8
Finish to finish
The successor activity can
complete only when
predecessor completes.
A B
Finish to Finish
Lay asphalt Paint
parking
lines
PDM
Start to Start
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9
PDM
Start to start
The successor can start
only when predecessor
starts.
A B
Start to Start
Furniture
move-in
Employee
move-in
PDM
Start to Finish
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0
Start to finish
The successor can
finish only when
predecessor starts.
This relationship is
rarely used.
A B
Start to Finish
Test new
System
Phase-out
Old system
PDM
dependencies such as Start
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1
dependencies such as Start
to start, finish to finish, and
start to finish have not been
implemented consistently.
Therefore, if you use them on
your project management
software, they can result in
unexpected outcomes.
Schedule Network
templates
SIMILAR networks from your past
TOOLS &
TECHNIQUES
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2
SIMILAR networks from your past
projects can be used to expedite
preparing current projects network
MAY use it for the entire project or
for a portion of it. The companies
doing same type of projects over the
years have standardized the
networks based on their experience.
Portions of the such schedule
network diagrams are called
FRAGMENT NETWORK or
SUBNETWORK.
TECHNIQUES
Precedence
diagramming
method (PDM)
Schedule network
templates
Dependency
determination
Applying leads and
lags
Schedule Network templates
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3
Schedule Network templates
When are Subnetwork templates especially useful?
Answer: When a project includes identical nearly identical
deliverables.
EXAMPLES
1) Coding program modules on a software project
2) Clinical trials on pharmaceutical project
3) Start-up phase of a development project
4) Floors on a high-rise building
1) Mandatory dependencies
(hard logic)
determined by the type of work being
TOOLS &
TECHNIQUES
50
4
determined by the type of work being
performed.
offer physical limitations as the nature of
work itself dictates the order of activities.
In the Century Cotton Mills example,
you cant prime the walls until
scraping is done before.
In ECE Industries example, you can
not make control board until printed
circuit boards are populated and wave-
soldered.
TECHNIQUES
Precedence
diagramming
method (PDM)
Schedule network
templates
Dependency
determination
Applying leads and
lags
2) Discretionary dependencies (soft
logic, preferred logic, preferential logic)
TOOLS &
TECHNIQUES
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5
logic, preferred logic, preferential logic)
DETERMINED by the project
management team.
THESE dependencies allow the activities
to happen in a preferred order because
of best practices in the application area.
SOMETIMES, specific sequence is
desired due some unusual aspect of the
project, besides alternative sequences
being available.
TECHNIQUES
Precedence
diagramming
method (PDM)
Schedule network
templates
Dependency
determination
Applying leads and
lags
3) External dependencies
are external to the project and
depend on relationship between
TOOLS &
TECHNIQUES
50
6
project activities and non-
project activities.
Examples
1) Testing schedule activity on a
software project may depend
on delivery of hardware from
an outside source
TECHNIQUES
Precedence
diagramming
method (PDM)
Schedule network
templates
Dependency
determination
Applying leads and
lags
3) External dependencies
are external to the project and
TOOLS &
TECHNIQUES
50
7
project activities and non-
project activities.
Examples
2) Governmental environmental
forecasts may need to be
held before site preparation
on a construction project.
TECHNIQUES
Precedence
diagramming
method (PDM)
Schedule network
templates
Dependency
determination
Applying leads and
lags
Leads and lags
LEAD
TOOLS &
TECHNIQUES
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8
LEAD
an overlap in the relationship
allowing the successor activity to be
scheduled earlier than the
predecessor will generally allow.
A
B
Lead subtracts time
Example
In a FS relationship with 5-
day lead, the successor
activity begins 5 days
before the predecessor has
finished
TECHNIQUES
Precedence
diagramming
method (PDM)
Schedule network
templates
Dependency
determination
Applying leads
and lags
Leads and lags
LEAD
Example
TOOLS &
TECHNIQUES
50
9
A
B
Lead subtracts time
Example
A technical writing team can
begin writing the second
draft of a large document
(successor activity) 15 days
before they complete
writing the entire first draft
(predecessor activity).
TECHNIQUES
Precedence
diagramming
method (PDM)
Schedule network
templates
Dependency
determination
Applying leads
and lags
This can be done by finish to
start relationship with 15 days
lead time!
Leads and lags
LAG
a gap in the relationship causes
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0
a gap in the relationship causes
the successor activity to be scheduled
later than the predecessor will
generally allow.
Example
In Century Mills, there is a 3-day delay
between Priming and Painting. The
painting activity begins 3 days after
the predecessor has finished, for primer
to dry up.
A
B
Lag adds time
PROJECT Schedule
NETWORK DIAGRAMS
Schematically show project
OUTPUTS
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1
Schematically show project
activities along with their
dependencies
May be drawn manually or on
computer, using PDM or ADM
May incorporate full project
details ,or just one or more
summary details- called
Hammocks.
OUTPUTS
Project Network
Diagrams
Project documents
updates
PROJECT NETWORK DIAGRAMS
A summary description of
Sequence Activities
OUTPUTS
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2
A summary description of
sequencing approach accompanies
them
Unusual sequences, if any, are
properly narrated
A network diagram is traditionally
known as PERT Chart, however
PERT (program evaluation and
review technique was a particular
type of network diagram using
weighted average.
OUTPUTS
Project Network
Diagrams
Project documents
updates
ACTIVITY LIST UPDATES
While preparing network diagrams,
Sequence Activities
Project document
updated:
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3
While preparing network diagrams,
we may discover some instances
where certain activities must be
divided or refined in order to show
correct logical dependencies.
This leads to activity list updates to
include approved changes.
updated:
1) Activity list updates
2) Activity attributes
updates
3) Risk register
updates
ACTIVITY attributes updates
activity attributes are updated to
Project document
updated:
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4
Include:
1) Defined logical relationships
2) Associated leads and lags
If approved change requests resulting from
activity sequencing affect the activity list,
then the related items in activity attributes
are also updated to include these approved
changes!
updated:
updates
3) Risk register
updates
Risk register updates
to document critical areas in the
schedule like path of
Project document
updated:
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5
schedule like path of
convergence or divergence or
there may be more than one
critical paths!
updated:
updates
3) Risk register
updates
FOR EACH ELEMENT AT LOWEST LEVEL OF WBS
WHAT TYPE
OF PHYSICAL
RESOURCES
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6
TO PERFORM PROJECT ACTIVITIES
RESOURCES
ARE
REQUIRED?
IN WHAT
QUANTITIES?
WHEN
ARE THEY
REQUIRED?
Closely coordinated with cost estimating!
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Resources are a projects most important assets.
The project managers are often
faced with the issue of limited resources
Management of resources is as
important as managing
time, cost, quality and scope
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8
Ability of the project manager to effectively organize
resources can make difference between project
success or failure!
Resources must be planned and coordinated to avoid
common problems of resources non-availability or their
being taken away from the project
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9
Resource Planning must
be well coordinated with cost estimating.
The quality of resource, their knowledge
of latest techniques of performing
work in their application area,
and their skills will immensely impact the cost
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THE PROCESS OF DETERMINING
1. WHAT PHYSICAL RESOURCES (PEOPLE, EQUIPMENT, MATERIALS)
2. WHAT QUANTITY OF EACH RESOURCE (SHOULD BE USED)
3. WHEN THEY WOULD BE REQUIRED
TO COMPLETE PROJECT ACTIVITIES
process overview
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1
Enterprise
assets
Activity list
Activity attributes
Resource calendars
INPUTS
TOOLS &
TECHNIQUES
Expert judgment
Alternatives
analysis
Published
estimating data
Project
management
software
Bottom-up
estimating
OUTPUTS
Activity Resource
requirements
Project Document
Updates
updates
Resource breakdown
structure
Estimate Activity Resources process: INPUTS
Enterprise environmental factors provide
information on availability and skills of resources.
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2
information on availability and skills of resources.
Organizational process assets provide
1) policies and procedures regarding staffing,
2) Policies and procedures for rental and
purchases
3) Historical information on resources used in
similar projects.
Activity list identifies activities for which
resources are to be estimated.
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3
resources are to be estimated.
Activity Attributes developed during Define
Activities and Sequence Activities processes
provide PRIMARY DATA input for estimating
resources for each activity.
Resource Calendars
Helps us know what resources are potentially
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4
available (people, equipment, and material)
during planned activity period. Resource
calendars are developed during
Expert judgment helps you
Assess inputs to resource planning.
Alternative analysis makes you
Estimate Activity
Resources
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5
Alternative analysis makes you
identify alternative methods of
accomplishing schedule activities,
Each one needing:
1) Different levels of resource
capability/skills
2) Different size/types of machines
3) Different tools (manual or automated)
4) Make or buy decisions
Published estimating data
helps you in estimating resources
for schedule activities.
Estimate Activity
Resources
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6
for schedule activities.
Many companies trading in
these resources routinely
publish extensive array of:
Labor trades
Material
Equipment
For different countries and different
locations within countries
Project management
software
Helps plan, organize, and
manage resource pools and
Estimate Activity
Resources
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Helps plan, organize, and
manage resource pools and
develop resource estimates.
Sophisticated ones can define:
Resource breakdown structures
Resource availabilities
Resource rates
Various resource calendars
Bottom-up estimating
Involves breaking up the work
within a schedule activity into
more detail.
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8
more detail.
Used when a schedule activity
cant be estimated for resource
with confidence.
Resource needs of each smaller
piece are estimated and then
added up to find total resource
need for the particular schedule
activity as a whole.
The pattern of resource
usage may be influenced
Estimate
Activity
Resource
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9
usage may be influenced
by dependencies between
activities.
Wherever this applies, we
reflect it in the resource
requirements of the
concerned schedule
activities.
Activity resource
requirements
Identify and describe the types
and quantities of resources
Estimate
Activity
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0
Identify and describe the types
and quantities of resources
required for EACH SCHEDULE
ACTIVITY IN A WORK
PACKAGE.
We can find resource
requirements for each work
package by adding up resource
requirements of all its schedule
activities.
Level of specificity and detail varies
by application area!
Activity
Resources
Activity resource
requirements
please dont forget to
document:
Estimate
Activity
Resources
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1
please dont forget to
document:
1) Basis of estimate and
2) Assumptions
made while determining which
type of resources are applied,
their availability, and what
quantities are used!
SCHEDULE DEVELOPMENT PROCESS
DETERMINES WHEN RESOURCES
WOULD BE REQUIRED!
Resources
Project Document updates
resource types and quantities
for each schedule activity is
mentioned in the concerned
Estimate Activity
Resources
53
2
mentioned in the concerned
activity attributes.
If approved requested changes
result from this process, then
activity list and activity
attributes are updated to reflect
these approved changes!
RBS
Hierarchical structure of the
identified resources by
Estimate
Activity Resources
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3
identified resources by
resource category and
resource type.
ESTIMATING FUNDAMENTALS?
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4
You should have properly defined scope (WBS).
Many people do not take time to freeze complete
scope of work in the beginning and the scope keeps
getting defined till delivery of the product of the project!
You should have reliable Network Diagram
showing how project will flow from start to finish.
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5
You should have information on what were estimates
on similar past projects, with errors and omissions.
Additionally, you should also have access to
commercially available estimating databases.
Estimate Activity
Durations
53
6
You should have full understanding of the capabilities of
both human and material resources you are going to use
for performing project activities.
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7
You must be aware of all the potential risks that may
have negative or positive impact on your estimates. This
is a grey area in many organizations.
We seem to have enough time to do rework than to do it
right the first time. Risks are not fully identified in the
beginning. They are taken to be a way of life.
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8
Project management software
does the estimating to the extent
it has data with it.
It can never replace your objective
of doing a better job of estimating each time.
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9
Who should provide inputs for estimates of
duration? In many organizations everybody seem to
offer them!
It is highly risky to accept them from just anybody.
They should be provided only by those people or the
group who are well conversant with the nature of the
concerned schedule activity.
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0
ONLYthe person or group (on the project team) who
is most knowledgeable about the particular activity
should develop or at least approve the estimate.
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1
Can estimate be accurate and of good quality
(achievable) if done just once?
No, estimate evolves progressively CONSIDERING
THE AVAILABILTY AND RELIABILITY OF DATA, and
it becomes more accurate and reliable only after
due progressive elaboration.
DURATION is the time required for completing an
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2
DURATION is the time required for completing an
activity. Estimating this duration is actually
approximating how many work periods (hours, days,
weeks, months), it will take.
In real life, while performing an activity, you have non-
work periods also, like Sundays and other holidays.
Your estimation should not ignore them. You need to
use both Project calendar and Schedule activity
resource calendar!
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3
Using alternative work period calendar, almost all
scheduling software take care of this.
Total activity duration = work periods + non-work
periods.
Total project duration is properly arrived at only
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Total project duration is properly arrived at only
after schedule development. However, schedule activity
duration estimating gives a preliminary idea of total
project duration and serves as an important input to
creating schedule.
The project team is free to choose to estimate project
duration:
1. As a probability distribution by using probabilistic methods
2. As a single point estimate using deterministic methods
PROCESS OF
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5
PROCESS OF
Estimating schedule activity durations
For inputs to schedules
Using information:
a) Schedule activity scope of work
b) Required resource types
c) Estimated resource quantities
d) Resource calendars
e) Resource capabilities
Please
remember
this!
Estimate Activity Durations process overview
INPUTS
TOOLS & OUTPUTS
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6
Enterprise
assets
Activity list
Activity attributes
Activity Resource
requirements
Resource calendar
INPUTS
TOOLS &
TECHNIQUES
Expert judgment
Analogous
estimating
Parametric
estimating
Three point
estimates
Reserve analysis
OUTPUTS
Activity duration
estimates
Project Document
updates
Enterprise
Provide
Estimate
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7
Provide
1) duration estimating
databases and other
reference data,
2) Productivity metrics
3) Published commercial
information!
Estimate
Activity
Durations
assets
Provide
Estimate
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8
Provide
1) Historical duration
information,
2) Project calendars,
3) Scheduling
methodology, and
4) Lessons Learned.
Estimate
Activity
Durations
Estimate Activity Duration INPUTS
Provides constraints and assumptions that we do
consider while estimating durations.
54
9
consider while estimating durations.
Examples
1) Constraint:
- Available skilled resource
- Contract terms and conditions
2) Assumptions:
- existing conditions
- Availability of information, and
- Length of the reporting periods.
Activity list and activity
attributes
Estimate
55
0
Serve as primary inputs.
Estimate
Activity
Durations
Estimate
Activity resource
requirements
resources assigned to the
55
1
Estimate
Activity
Durations
resources assigned to the
schedule activity and their
availability significantly
influences duration
Example: If a schedule activity
needs two engineers to work
together to complete it, and
we get only one, then its
duration will double.
Activity resource
requirements
What happens if additional
Estimate
Activity
Durations
55
2
What happens if additional
resources (than required) are
added or lower skilled one are
applied to the schedule
activity?
Answer: Efficiency reduces! Work
production increase becomes
less than the equivalent
increase in percentage of
resources!!
Resource calendar
composite resource calendar
details:
Estimate
55
3
details:
- Availability
- Capability
- Skills of HR RESOURCES
- Type,quantity, availability and
capability of material and
equipment resources
They can greatly influence
duration and hence considered.
Estimate
Activity
Durations
Expert judgment
team members rely on their knowledge and
experience, but these estimates can be very
Estimate
Activity
Durations
55
4
experience, but these estimates can be very
risky:
1) Many factors influence activity durations,
such as resource capability, resource
levels required/assigned, etc., that need to
be carefully considered.
2) May be subject to bias, not based on
scientific means.
3) Not based on documented data but simply
on recall.
TOOLS & TECHNIQUES
Expert judgment
Therefore, expert judgment must be combined
with historical information and use as many
55
5
with historical information and use as many
experts as possible.
Expert judgment, guided by historical information,
can provide:
1) Duration estimate or recommended maximum
activity durations from similar past projects.
2) Knowledge whether to combine methods of
estimating and how to reconcile differences.
TOOLS & TECHNIQUES
Analogous estimating
THE actual duration of a similar activity completed on
a previous project to determine the duration of same
55
6
a previous project to determine the duration of same
type of activity on the current project.
USED only in early phases of the project (initiation)
when we don not have detailed information about the
project. Uses historical info and expert judgment!
When analogous estimating is most reliable?
When previous projects activities are really similar, not
just apparently similar
The people making this kind of estimate have
necessary expertise
TOOLS & TECHNIQUES
It is a gross value estimation approach,
sometimes adjusted for known differences in
55
7
sometimes adjusted for known differences in
project complexity.
Less costly and time consuming, less accurate
too.
May be applied to total project or its segment
and may be combined with other estimating
methods.
TOOLS & TECHNIQUES
parametric estimating
Uses a statistical relationship between historical
data and other variables (square footage in
55
8
construction) to calculate an estimate for activity
parameters like cost, budget, and duration.
on a Design Project:
1) number of drawings X labor
hours per drawing
2) cable installation in meters X
labor hours per meter
TOOLS & TECHNIQUES
parametric estimating
Uses a statistical relationship between historical
55
9
construction) to calculate an estimate for activity
parameters like cost, budget, and duration. It
Can provide higher levels of accuracy depending
upon sophistication and underlying data built into
the model. Parametric estimate can be applied to
entire project or its segment and can be used in
combination with other techniques.
EXAMPLE
TOOLS & TECHNIQUES
parametric estimating EXAMPLE
Total resource quantities are multiplied by labor hours
56
0
Total resource quantities are multiplied by labor hours
per unit of work.
Say, on a design project:
Number of drawings X Number of labor hours per
Drawing
On cable installation project:
Meters of cable X Number of labor hours per meter
Three-point estimates
Just consider how risky are your
original single point estimates?
Estimate Activity
56
1
We can improve the accuracy by
finding three-point estimates and
then take their average:
1) Most likely tM
2) Optimistic tO
3) Pessimistic tP
Estimate Activity
Durations
TOOLS &
TECHNIQUES
1) Most likely: duration considering
all resources with their
Estimate Activity
56
2
productivity, availability,
dependencies on their
participants, and interruptions.
2) Optimistic: best case of most
likely.
3) Pessimistic: worst case of most
likely.
Estimate Activity
Durations
TOOLS &
TECHNIQUES
TOOLS & TECHNIQUES
The concept originated with the Program Evaluation
and Review technique (PERT). PERT uses three
56
3
and Review technique (PERT). PERT uses three
estimates to define an approximate range for activity
duration: Most Likely, Optimistic, and Pessimistic.
Then, calculates an EXPECTED (tE) activity
duration using a weighted average of three
estimates:
tE = tO + 4 tM + tP
6
Reserve analysis
an additional time (known as time
buffer, reserve, or contingency)
Estimate Activity
56
4
buffer, reserve, or contingency)
added to the activity duration or
elsewhere in the schedule as
recognition of schedule risk:
1. A percentage of estimated activity
duration, a fixed number of work
periods, or
2. As developed by quantitative
schedule risk analysis (good)
Estimate Activity
Durations
TOOLS &
TECHNIQUES
Reserve analysis
Please remember!
Estimate
56
5
A contingency reserve can be used
completely or PARTIALLY , OR
LATER REDUCED OR
ELIMINATED as you progress and
get more precise information
about the project. Contingency
reserve is also documented with
other related data and
assumptions!!!
Estimate
Activity
Durations
USING Reserve time (contingency)
TWO things prevail:
56
6
TWO things prevail:
1. Parkinson's law
Work expends to the available time.
2. Student syndrome
Work is attended only when the deadline
dangles like Damocles sword over our
head.
USING Reserve time
(contingency)
Estimate
56
7
HOW should the time buffers be
used?
Use them too freely and too early
and you have nothing left for later
when reserves might be critical.
Be too stingy and you stifle
progress, increase risk, and end
up with left over reserves that
might have to be put to better use.
Estimate
Activity
Durations
TOOLS &
TECNIQUES
USING Reserve time
(contingency)
Estimate
56
8
HOW should the time
buffers be used?
ANSWER
A guideline that must be adopted
for allocation of time reserves is
to set hard limits as to how much
to release in each period of the
project.
Estimate
Activity
Durations
TOOLS &
TECNIQUES
Activity duration estimates
Activity duration estimates are
quantitative assessments of the
Estimate
Activity
Durations
OUTPUTS
56
9
quantitative assessments of the
likely number of work periods that
will be required to complete an
activity.
Please note:
Duration estimates do not include
any lags!
OUTPUTS
Activity duration estimates
Activity duration estimates may
include some range of possible results:
Estimate
Activity
Durations
OUTPUTS
57
0
include some range of possible results:
2 weeks +/- 2 days to indicate that the
activity will take at least eight days and
no more than twelve days (assuming 5
day week).
15 % probability of exceeding three
weeks to indicate a high probability,
85%, that the activity will take three
weeks or less.
OUTPUTS
Activity attributes
Estimate
Activity
Durations
OUTPUTS
57
1
Activity attributes
Assumptions made in developing the
activity duration estimates (skill levels
and availability)
OUTPUTS
ONE OF THE MOST CRUCIAL AREAS
Develop Schedule
57
2
ONE OF THE MOST CRUCIAL AREAS
of
THE PROJECT MANAGEMENT !
It is the basis for
1. Allocating resources,
2. Estimating costs, and
3. Tracking project performance.
APPROVED SCHEDULE SERVES AS SCHEDULE BASELINE
THE KEY WORDS ARE START AND
FINISH DATES!
Develop Schedule
57
3
FINISH DATES!
Schedules show the timing for work elements
start and finish dates and denote when events
and milestones take place.
Therefore, schedule development is the process
of determining start and finish dates for project
activities.
Schedule development is an iterative process
Requires that duration estimation and resource
Develop Schedule
57
4
Requires that duration estimation and resource
estimates are reviewed and revised to create an
approved schedule
Continues throughout as:
1) project progresses,
2) project management plan changes, and
3) anticipated risk events occur or disappear as
new risks are identified
Schedule Development
57
5
But what if our start and end dates are unrealistic?
Well then, we will never finish
our project as scheduled
and
this by far is
the most common experience!
FREQUENT CAUSES OF PROJECT FAILURE
Develop Schedule
57
6
1. Scheduling and allocation of resources
are incorrect.
2. Assignments are not anticipated.
3. Resource skills and capabilities are
unknown.
4. Resources for back up are not available.
Project Time Management:
The problem emerges during planning and continues
through out the project:
Schedule Development
57
7
through out the project:
Project staff are reassigned and turned over without
readjusting the schedule to allow for the lost time or
the learning curve.
Resource requirements are not anticipated and
scheduled, and resource issues are addressed only
as they occur.
There is generally no skill inventory indicating who
is available for the project.
Develop Schedule process overview
assets
INPUTS
TOOLS &
TECHNIQUES
Schedule network
OUTPUTS
Project schedule
Schedule data
57
8
assets
Activity list
Activity attributes
Project schedule
network diagrams
Activity resource
requirements
Resource Calendars
Activity duration
estimates
Factors
Schedule network
analysis
Critical path method
Schedule compression
What-if scenario
analysis
Resource leveling
Critical chain method
Adjusting leads & lags
Schedule Tool
Schedule data
Schedule baseline
Schedule Data
Project Document
Updates
Develop Schedule - INPUTS
Provide project calendar:
57
9
A Calendar of working
days/shifts that establish
the dates on which
1) Schedule activities are
worked
2) Schedule activities are idle
Provides constraints and
Assumptions that impact
58
0
Assumptions that impact
development of project schedule.
Constraints
FACTORS THAT LIMIT project
Management teams options when
performing schedule network analysis. Two
major categories of constraints used:
1) Imposed dates
2) Key events or major milestones
Develop Schedule
1) Imposed dates on activity start or
58
1
finish dates to occur no earlier than
a specified date or no later than a
specified date.
Most commonly used:
A) Start No Earlier Than (SNET):
B) B) Finish No Later Than (FNLT):
CAN YOU THINK WHY SUCH
CONSTRAINTS ?
Develop Schedule
These time constraints
are in response to:
Agreed-upon contract dates
58
2
Agreed-upon contract dates
a market window on a technology
project
weather conditions for outdoor work
compliance to government
requirements (safety requirements for
hazardous projects, or pollution control
requirements, etc.)
supplies form the outside agencies
not shown in the project schedule,
etc.
Develop Schedule
2. Key events or major milestones:
Project sponsor, customer, or other
stakeholders often dictate key
58
3
stakeholders often dictate key
events and major milestones
affecting the completion of certain
deliverables.
Once scheduled, these dates
become expected. They can be
moved only through approved
changes!
Milestones are also used to indicate
work outside (not shown project
database).
develop Schedule
Assumptions
are the factors we have documented
so far and taken them true or certain
58
4
so far and taken them true or certain
for planning purpose.
We examine them for their impact
while developing project schedule.
All endeavors are to be made to
ensure that they do not turn out
false and become risks!
We have already discussed and use them for
developing schedule:
- Activity list
58
5
- Activity list
- Activity attributes
- Project schedule network diagrams
- Activity resource requirements
- Resource Calendars
- Activity duration estimates
Develop Schedule
TOOLS &
TECHNIQUES
Schedule network analysis
A technique to generate project
58
6
TECHNIQUES
A technique to generate project
schedule.
Uses a schedule model and various
analytical techniques (CPM, CCM,
what-if-analysis, resource leveling) to
calculate early start and finish
dates, and scheduled start and
finish dates for uncompleted
portions of schedule activities.
Schedule network analysis
Loops and open ends in the
Develop Schedule
TOOLS &
TECHNIQUES
58
7
Loops and open ends in the
network diagram are adjusted
before any analytical technique is
applied.
Path convergence/divergence
points are identified and used in
schedule compression or other
analysis.
TECHNIQUES
CPM
Calculating theoretical early
and late start and finish dates
Develop Schedule
TOOLS &
TECHNIQUES
58
8
and late start and finish dates
for project activities (without
considering resource
limitations).
Indicate the time periods within
which the activity could be
scheduled (given activity
durations, logical
relationships, leads and lags
and other known constraints ).
TECHNIQUES
CPM
Calculated ES and EF and LS
and LF dates may not be the
Develop Schedule
TOOLS &
TECHNIQUES
58
9
and LF dates may not be the
same on any network
diagram. WHY?
Because total float (which
gives scheduling flexibility)
may be:
1) Positive
2) Negative
3) zero
TECHNIQUES
Develop Schedule- TOOLS & TECHNIQUES
CPM
Finding scheduling flexibility on any network path
59
0
Finding scheduling flexibility on any network path
Find positive value of LF-EF or LS-ES
This positive value is called TOTAL FLOAT
TOTAL FLOAT is the amount of time that a schedule
activity can be delayed from its ES date without
delaying the project finish date or violating a schedule
constraint.
Develop Schedule
CPM
Critical paths
59
1
Critical paths
Have either a ZERO or Negative total float!
Schedule activities on critical path are called critical
Adjustments to activity durations, logical relationships,
leads and lags, or other schedule constraints are
necessary to make network paths with zero or positive
total float.
Develop Schedule
CPM
Finding FREE FLOAT
59
2
Finding FREE FLOAT
When the total float for a network path is zero or
positive, then the free float can be found!
Free float is the amount of time that a schedule activity
can be delayed without delaying the early start date of
any immediately successor activity!
Develop Schedule
CPM
The Critical Path (CP)
In any project is the longest full path of activities
59
3
In any project is the longest full path of activities
Any activity on critical path normally has zero float.
Start
D C H E G
A F B
End
4 8 5 7 8
6 7 5
Paths
D, E, G, H, C = 32 Weeks
A, F, B = 18 Weeks
D, F, B = 16 Weeks
D, F, G, H, C = 31 Weeks
A, F, G, H, C = 33 Weeks
Develop Schedule
CPM
Floats (slacks)
Free float
59
4
Free float
the amount of time an activity can be delayed without delaying
the early start date of its any successor activities.
Total float
the amount of time an activity can be delayed without delaying
the project completion date.
Project float
the amount of time a project can be delayed without delaying
the externally imposed project completion date required by the
customer or management, or previously committed by the
project manager.
Develop Schedule
CPM
CALCULATING FLOAT
1. First, calculate early start and early
ES EF
FORWARD PASS
59
5
finish dates: FORWARD PASS
START
A, 3
END
B, 5 C, 2 D, 7
E, 9 F, 2 G, 4
1 3
ES EF
4 8 12 13 14 20
1 9 10 11 12 15
WE HAVE NOT MARKED THE CRITICAL PATH SO FAR
Develop Schedule
CPM
CALCULATING FLOAT
2. Second, calculate late start and late
finish dates: BACKWARD PASS
ES EF
BACKWARD PASS
59
6
finish dates: BACKWARD PASS
START
A, 3
END
B, 5 C, 2 D, 7
E, 9 F, 2 G, 4
1 3
ES EF
4 8
4 6
12 13 14 20
1 9 10 11 12 15
LS LF
7 11 12 13 14 20
1 9 10 11
17 20
WE HAVE NOT MARKED THE CRITICAL PATH SO FAR
Develop Schedule
CPM
CALCULATING FLOAT
3. Now, calculate the float
ES EF
BACKWARD PASS
FLOAT (F) = LS - ES
59
7
WE HAVE MARKED THE CRITICAL PATH HERE
START
A, 3
END
B, 5 C, 2 D, 7
E, 9 F, 2 G, 4
1 3
ES EF
4 8
4 6
12 13 14 20
1 9 10 11 12 15
LS LF
7 11 12 13 14 20
1 9 10 11 17 20
F = 3 F = 3 F = 0 F = 0
F = 0 F = 0 F = 5
FLOAT (F) = LS - ES
OR = LF - EF
CPM
Use of float (slack)
59
8
Use of float (slack)
Float is extremely useful for you:
1. It allows better allocation of resources
2. It helps team members juggle multiple projects by
telling them how much time flexibility they have on
each activity they are working on.
PERT just need to know
Program Evaluation and Review
Technique (PERT)
59
9
Technique (PERT)
PERT was developed for application in projects where there was
uncertainty in the nature and duration of the activities. It originated
in late 1950s during U.S. Navys Polaris Missile System program.
In complex Research and Development projects, there
are questions about the kind of research to be done,
how long it will take, what stages of development are
necessary, and how fast they can be completed- largely
because the nature of THE UNCERTAINITY about the
exact nature of the final outcomes.
PERT just need to know
PERT
60
0
PERT
Such projects are contracted as new developments unfold
and before problems in technology, materials, and processes
are identified and resolved.
Hence, the duration of the project is uncertain along with the
risk of overrun of target completion date.
So, PERT was developed as a solution to handling
uncertainties in estimating activity durations.
BY using three time estimates: Optimistic, Most likely, and
Pessimistic.
Pert weighted average =
Optimistic + 4 x Most Likely + Pessimistic
6
60
1
Understanding meaning of three time estimates:
OPTIMISTIC
is the minimum time an activity could take. It is a situation when
everything goes well. There is some hope of finishing earlier.
60
2
everything goes well. There is some hope of finishing earlier.
MOST LIKELY
is the normal time to complete the activity, and would occur most
frequently if the activity could be repeated.
PESSIMISTIC
is the maximum time an activity could take. The situation where
bad luck is encountered at every step.
The pessimistic time includes likely internal problems in
development or fabrication, but not environmental snags such as
fire, power shortages, bankruptcy, strikes, or natural disasters.
PERT: THREE TIME ESTIMATES
WHO GIVES THREE TMES ESTIMTES?
You get them from:
60
3
You get them from:
1. THE most knowledgeable people who know the
difficulties likely to occur and the potential variability in
time.
2. THE expert estimators
3. THOSE who will actually perform or manage the
activity.
Three time estimates are used to calculate the expected time
60
4
Three time estimates are used to calculate the expected time
for each activity.
FORMULAS
1. EXPECTED TIME
= O + 4M + P / 6
2. STANDARD DEVIATION of an activity duration (SD)
= P O / 6
3. VARIABILITY IN THE ACTIVITY COMPLETION TIME (Activity Variance, V)
V = (P O / 6 )2
OPTIMISTIC = O
MOST LIKELY = M
PESSIMISTIC = P
KEY:
(0, M, P)
Exp. Time, V
60
5
ESTIMATING ACTIVITY DURATION
0 3 5 6 13
PESIMISTIC
AVERAGE
OPTIMISTIC MOST LIKEY
P
R
O
B
A
B
I
L
I
T
Y
ACTIVITY DURATION TIME IN DAYS
( 4, 11, 12 )
10, 1.78
( 3, 4, 5 )
4, 0.11
( 3, 12, 21)
12, 9.00
1 7 8
2 6
1 4 5
( 1, 4, 7 )
4, 1.00
( 6, 15, 30 )
16, 16.00
PERT: calculating expected time
( expected duration, expected value, weighted average)
60
6
Then the expected duration
= 3+4(5)+13 /6
= 36 / 6 = 6 days.
For an activity:
O = 3 days
M = 5 days
P = 13 days
Formula
O+4M+P/ 6
PERT: calculating standard deviation, SD
For an activity:
O = 3 days
60
7
In present case, SD = 13 3 / 6 or
= 10 / 6
= 1.67 days
O = 3 days
M = 5 days
P = 13 days
FORMULAS
Expected value:
O+4M+P/ 6
Standard deviation:
P O / 6
Hence
Expected value
= 6 days
Standard deviation
= 1.67 days
The range between estimates
provides a measure of variability,
which allows statistical conclusions
regarding probability of project
activities completing at particular
times.
PERT: calculations
60
8
Completion probability for this activity:
1. There is a 68.26% chance that this activity will
be completed between 4.33 days and 7.67 days:
We get it by once deducting the value of one SD
from value of expected duration ( 6 1.67 = 4.33 )
and then adding the value of one SD to the value
of expected duration (6+1.67 = 7.67).
PERT: calculations
60
9
Completion probability for this activity:
2. There is a 95.44% chance that this activity will
be completed between 2.66 days and 9.34 days.
We get it by once deducting the value of two SD
from the value of expected duration ( 6 3.34 =
2.66 ) and then adding the value of one SD to the
value of expected duration (6+ 3.34 = 9.34).
PERT: points to remember
61
0
1. The higher the standard deviation for an activity,
the higher the risk.
2. Standard deviation measures the difference
between the pessimistic and optimistic times.
3. A greater spread between the two results in higher
standard deviation and therefore higher risk.
4. Hence, lower the standard deviation, lower the risk.
REAL LIFE
SCENARIO
61
1
Bank Gold Coin Project
S. Vaijayanthi is the project manager for this project where the
bank has desired the sale of Gold Coins on Web. She is required
to devise a software system. There are 9 activities to complete
the project. With her team, she has made network diagram,
performed activity duration estimation, and found critical path.
She has also found out values of optimistic, pessimistic, and
most likely estimates.
How can she calculate the project duration
using PERT method?
REAL LIFE
SCENARIO
ICICI Bank Gold Coin Project
Solving the riddle:
61
2
Solving the riddle:
1. First calculate the expected value for each activity on critical path and
total all values to get total expected value.
2. Second, find out Standard deviation for each activity and square it to
get SD Squared (called Activity Variance) for each activity, and total
SD Squared.
3. Third, find out square root of the sum of SD Squared, which gives us
value of standard deviation.
4. Now everything is easy, we can comfortably tell probability of project
completing at 1 standard deviation or 2 standard deviation.
Let's apply it to ICICI Bank Gold Coin Project. Examine the data Ms
Vaijayanthi has worked out so far as shown in the next slide
REAL LIFE
SCENARIO
Develop Schedule
ICICI Bank Gold Coin Project- PERT Data worked out by Ms Vaijayanthis team
A B C D E F G H I
ACTIVITIES
PERT
CALCULATIONS
Optimistic 10
On CP On CP On CP On CP On CP On CP On CP
8 38 20 5 3
1
- -
non
CP
non
CP
61
3
Optimistic
Pessimistic
Most likely
Expected Value
Standard Deviation
Standard Deviation
Squared (SD) 2
TOTAL SD Squared
TOTAL Expected Value
14
10
12
12.00
0.67
0.45
8
14
10
10.33
1.00
1.0
38
57
45
45.83
3.17
10.05
20
32
22
23
1.67
2.79
5
10
8
7.83
0.83
0.69
3
3
3
3.00
0
0
1.00
0
0
1
1
1
102.99 or Say 103
14.98
CONCLUSIONS
-
-
-
-
-
-
-
-
-
-
-
-
Develop Schedule
REAL LIFE
SCENARIO
Project duration of ICICI Bank Gold Coin Project
61
4
Project duration of ICICI Bank Gold Coin Project
Total of expected value = 103 days
Total of SD squared = 14.98
Square root of SD squared = 3.87
Therefore the standard deviation is 3.87
Conclusions about ICICI Gold Coin Project:
1. 68.26% probability, it will complete between 99.13 days
and 106.87 days.
2. 95.44% probability, it will complete between 95.26 days
and 110.74 days.
shorten project schedule without
changing the project scope, to meet
Develop Schedule
TOOLS &
TECHNIQUES
61
5
changing the project scope, to meet
schedule constraints, imposed
dates, or other schedule objectives.
The techniques:
1. Crashing
2. Fast tracking
TECHNIQUES
1. Crashing
analysis of cost and schedule
Develop Schedule
TOOLS &
TECHNIQUES
61
6
analysis of cost and schedule
tradeoffs to obtain greatest schedule
compression for least increase in
cost.
Crashing leads to adding more
resources to critical path activities
while maintaining scope.
It generally results in increased cost
and can not always promise a viable
alternative.
TECHNIQUES
2. Fast tracking
performing critical path activities in
Develop Schedule
TOOLS &
TECHNIQUES
61
7
performing critical path activities in
parallel that are planned to be performed
in series.
Fast tracking trades of cost for time and
increases the risk of achieving the
shortened schedule. Often results in in
rework, increases risk, and needs
more attention to communications.
TECHNIQUES
HANDS-ON EXERCISE FOR STUDENTS
From data on two slides, please find out how much it will cost to crash the
Duration compression example
61
8
From data on two slides, please find out how much it will cost to crash the
schedule by 3 weeks!
Activities Dependencies Duration normal
A - 4
B A 6
C A 2
D B 2
E C,B 7
F D,E 6
Slide 1
THIS IS TO HELP
YOU TO DRAW
THE NETWORK
AND FIND CP
HANDS-ON EXERCISE FOR STUDENTS
Data continues ( duration is in weeks, cost in rupees)
Duration compression example
61
9
Data continues ( duration is in weeks, cost in rupees)
Activity Duration normal Crash duration Normal cost Crash cost Crash cost per week
A 4 2 10,000 14,000 2,000
B 6 5 30,000 42,500 12,500
C 2 1 8,000 9,500 1,500
D 2 1 12,000 18,000 6,000
E 7 5 40,000 52,000 6,000
F 6 3 20,000 29,000 3,000
Slide 2
Develop Schedule- Tools & Techniques
What-if scenario analysis
Calculating multiple project durations with
different set of activity assumptions with the use
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different set of activity assumptions with the use
of simulation techniques: Monte Carlo Analysis
(most common).
USES three time estimates like PERT but does
not use PERT formula.
Thus distribution of probable results is
determined for each activity and then utilized in
arriving at a distribution of probable results for
the whole project.
What-if Analysis
primarily used to understand the feasibility of
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primarily used to understand the feasibility of
schedule under unfavorable conditions.
This method also helps in making contingency,
or response plans to tackle or lessen the effect
of adverse situations.
Here, different scenarios are made using
network logic, assuming instances like delay in
supply from an external source, new regulation,
etc.
Resource leveling
WE have a schedule of activities.
Now, its time to plug in resources
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because :
Techniques like CPM and PERT did
not consider resource availability
and produced a preliminary early-
start schedule that needs more
resources during certain times than
available, or needs unmanageable
alterations in resource levels.
Resource leveling
WE have a schedule of activities.
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because :
We will also have to adjust our
schedule if we find any resource
constraints to our schedule of
activities made so far using
mathematical analysis techniques.
Resource leveling
process of adjusting resource
utilization on your project to match
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with real resource availability.
OFTEN INVOLVES:
Allocate scarce resources to critical
path activities first.
Move an activity in time to take
advantage of a period of under-
allocation elsewhere in the project.
Resource leveling
process of adjusting resource
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with real resource availability.
OFTEN INVOLVES:
Replace the resources that are not
over-allocated during the same
timeframe.
Increase the duration of an activity
while applying the same total effort.
Resource leveling generally extends
schedule. It can change CP.
Resource leveling
Other techniques in an event of
critical or limited resource
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critical or limited resource
availability:
Utilization of extended hours
Productivity increase of resources
Fast tracking
Reverse resource allocation
Critical chain method modifies project
schedule to account for limited
resources.
Resource leveling
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Some projects have can have a finite and critical
resource. In such cases, the resource is scheduled in
reverse from the project ending date. It is called
REVERSE RESOURCE ALLOCATION
SCHEDULING!
It may not result in an optimal project schedule.
Resource leveling
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Resource leveling produces a
RESOURCE-LIMITED SCHEDULE, or
RESOURCE-CONSTRAINED SCHEDULE!
Critical chain method
Another network analysis technique
that modifies project schedule to
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9
that modifies project schedule to
account for LIMITED RESOURCES.
Combines deterministic and
probabilistic approaches.
This method adds time buffers to
focus on planned activity durations.
How do we do it?
A) We find out CP making network diagram with non-
conservative estimates (taking required dependencies and
defined constraints as inputs).
THE STEPS: CRITICAL CHAIN METHOD
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defined constraints as inputs).
B) Then, we enter resource availability and determine
resource-limited schedule. Resulting schedule often
has an changed CP.
C) Now we determine duration buffers and schedule
the planned activities TO THEIR LATEST POSSIBLE
START AND FINISH DATES.
D) Consequently, in lieu of managing the total float of
network paths, we focus on managing 1) the time
buffers, 2) the resources for schedule activities.
Applying leads and lags
Leads and lags are adjusted during
schedule network analysis to
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schedule network analysis to
develop a viable schedule.
This is particularly important as
improper use of leads and lags
distorts the schedule.
Scheduling Tool
Schedule data and information is
compiled into the schedule model
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compiled into the schedule model
for the project.
We may use the schedule model
tool and its supporting data along
with manual methods or project
management software:
to perform schedule network
analysis for generating the project
schedule.
Develop Schedule- OUTPUTS
Project schedule
MAY be displayed in summary form for the whole project,
or in detailed form for various levels of WBS.
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or in detailed form for various levels of WBS.
SCHEDULE FORMATS
1. Project network diagrams (display project
logic and critical path activities).
2. Bar charts or Gantt charts (depict activity
start and finish dates, estimated durations,
and occasionally dependencies).
3. Milestone charts (show start or finish of
major deliverables or key external interfaces).
Project network diagram WITH DATES
CODE UNIT
30 Jun 15 Jun 16 Jun 16 May
Project Schedule FORMAT:
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4
WRITE
MANUAL
1 May
DESIGN
CODE
QUERY
CODE
ENTRIES
CODE
UPDATE
UNIT
TEST
UNIT
TEST
UNIT
TEST
SYSTEM
TEST
15 May
16 May
1 Jul 15 Jul
30 May 1 Jun 15 Jun
30 May 24 May
16 May 23 May
15 Jun 16 May
Activity
identifier
Activity Description
1.1. MB Provide new product
Period 1
Project Schedule Time Frame Calendar
Units
DETAILED SCHEDULE WITH LOGICAL RELATIONSHIPS
Period 2 Period 3 Period 4 Period 5
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Z deliverable- BEGIN 0
1.1.1 Work package 1- Develop comp 1 67
1.1.1.D Design component 1 20
1.1.1. B Build Component 1 33
1.1.1.T TEST COMPONENT 1 14
1.1.1. M1 Component 1 COMPLTED 0
1.1.2 Work package 2 develop comp 2 53
1.1.2.D Design component 2 14
1.1.2.B Build component 2 28
1.1.2.T TEST COMPONENT 2 11
1.1.2M1 Component 2 COMPLETED 0
1.1.3 Work package 3 Integrate Comps 53
1.1.3.G Integrate component 1 & 2 14
1.1.3.T TEST INTEGRATED PRODUCT Z 32
1.1.3.P DELIVER PRODUCT Z 7
1.1.MF Provide New Product Z 0
deliverable- FINISHED
ss
DATA DATE
Project Schedule FORMAT: Bar charts or Gantt charts
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6
Jan Feb Mar Apr May Jun
Activity A
Activity B
Activity C
Activity D
Project Schedule FORMAT: Bar charts or Gantt charts
Activity
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7
Activity
identifier
Period 1
Units
1.1 Provide New Product Z
deliverable 120
1.1.1 Work Package 1
develop component 1 67
1.1.2 Work Package 2
develop component 2 53
1.1.3 Work Package 3 -
Integrate Components 53
Data date
Project Schedule FORMATS: Milestone charts
Activity
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8
Activity
identifier
Period 1
Units
1.1. MB Provide New Product Z
deliverable - BEGUN 0
1.1.1. M1 Component 1 - completed 0
1.1.2. M1 Component 2 - completed 0
1.1. MF Provide New Product Z
Deliverable - FINISHED 0
Data date
Schedule data
Supporting data for the project
schedule
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schedule
Includes (at least)
Schedule milestones
Schedule activities
Activity attributes
All constraints and assumptions
Amount of additional data varies by
application area.
Schedule data
Supporting data for the project
schedule
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schedule
Frequently supplied supporting
details:
Resource requirements by time period
as Resource Histogram
Alternative schedules (best case, worst
case, resource not leveled, resource
leveled, with/without imposed dates)
Schedule contingency reserves
Project Document Updates
1) Activity resource requirements
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3) Calendar
4) Risk register
Discussion
Activity resource requirements: Resource leveling
Can have a significant effect on preliminary
estimates of the type and quantities of
resources required.
Discussion
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Activity resource requirements: if the resource leveling
analysis changes the project resource requirements,
then the resource requirements are updated.
Activity attributes: activity attributes are updated to
include any revised resource requirements and any
other revisions generated by Develop Schedule
process.
Discussion
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3
Calendar: the calendar for each project may use
different units as the basis for scheduling the
project.
Risk Register: is updated to reflect opportunities or
threats perceived through scheduling assumptions.
Processes involved in planning, estimating,
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4
Processes involved in planning, estimating,
budgeting and controlling costs to complete
the project WITHIN APPROVED BUDGET
Primarily concerned with the cost of resources
needed to complete the schedule activities
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5
needed to complete the schedule activities
But, project cost management should also
consider the effect of project decisions on the
the cost of:
1) Using
2) Maintaining and
3) Supporting the product of the project.
Less design reviews can reduce
project cost at the expense of
increase in customers operating costs!
This broader view of cost management is
called Life Cycle Costing.
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called Life Cycle Costing.
Life cycle costing together with value
engineering techniques can:
1) Improve decision-making
2) Reduce cost and execution time
3) Improve quality and performance of
project deliverable
Generally,predicting and analyzing prospective
financial performance of the product of the
project is done outside the the project.
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project is done outside the the project.
If it is done within the project, then we include
additional processes and general management
techniques: ROI, Discounted Cash Flow and
Investment payback analysis.
Please remember!
Project cost management is preceded by a planning effort
by the project management team. This planning effort is
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by the project management team. This planning effort is
part of the Develop Project Management Plan process.
We develop a cost management plan, setting out the
format and establishing the criteria for planning,
structuring, estimating, budgeting and controlling project
costs. The cost management plan processes, tools and
techniques are selected during project life cycle definition.
Please remember!
The cost management can establish:
1) Precision level: cost estimates will rounded off to a
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9
1) Precision level: cost estimates will rounded off to a
prescribed precision (Rs. 100, Rs. 1000) based on scope of
activities and magnitude of the project, including amount for
contingencies.
2) Units of measure: staff hours, staff days, week, lump sum,
etc. for each of the resources.
3) Organizational procedures links: each control account
(WBS component used for project accounting) is assigned a code
or account number linked to performing organizations accounting
system. May also include planning package.
Please remember!
The cost management can establish:
4) Control thresholds: agreed-upon amount of variation allowed
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4) Control thresholds: agreed-upon amount of variation allowed
at designated time periods during project.
5) EV Rules: a) EVM computation formula for determining estimate
to complete are defined, b) EV credit criteria (50-50, 0-100), c)
define WBS level at which EV analysis will be done.
6) Reporting formats: for various reports
7) Process descriptions: descriptions of each of the three cost
management processes are documented.
Please remember!
So the cost management plan sets the framework
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So the cost management plan sets the framework
for each of the cost management processes.
WHY?
So that performance of the processes will be
efficient and coordinated.
Processes:
1. Cost estimating
2. Cost budgeting
3. Cost control
Estimate Costs process overview
Enterprise
INPUTS
TOOLS &
TECHNIQUES
OUTPUTS
Activity Cost
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Enterprise
assets
Risk Register
Human Resource Plan
Project Schedule
Scope Baseline
Parametric estimating
Project management
estimating software
Vendor bid analysis
Reserve analysis
Cost of quality
Three Point Estimates
Expert Judgment.
Activity Cost
estimates
Basis Of Estimates
Project Document
Updates.
1) Enterprise environmental factors
- Market conditions: what
Estimate Costs - Inputs
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3
products/services are available, from whom,
under what terms and conditions.
- Commercial databases: resource cost
rates that track skills and human resource
cost, provide standard cost of material and
equipment. Another source: seller price
lists. helps organizing cost estimates
2) Organizational environmental factors
Provide:
1) Cost estimating policies
Estimate Costs - INPUTS
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1) Cost estimating policies
2) Cost estimating templates
3) Historical information (from various sources
within organization)
4) Project files: records of previous project
performance help in developing cost
estimates.
5) Project team knowledge
6) Lessons learned
3) Human Resource Plan
Project staffing attributes and personal rates,
and related rewards/recognition are necessary
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5
and related rewards/recognition are necessary
components for developing cost estimates.
4) Risk Register
should be reviewed to consider risk mitigation
costs. Risks, either threat or opportunities,
have impact on both activity and overall
project costs.
Risk Register
Please remember: As a general rule,
when project experiences a negative
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6
when project experiences a negative
risk event, the near-term costs of the
project will usually increase, and
sometimes delay project schedule.
5) Project Schedule
The type and quantity of resources and the amount
of time they are used ARE major factors in
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7
of time they are used ARE major factors in
estimating costs. Schedule activity resources
and their respective durations are key inputs.
Please remember: Impact of Estimate Activity
Resources process and Estimate Activity
Durations process on the Estimate Costs process!
Estimate Activity Resources determines quantities
of resources and is closely coordinated with cost
estimating!
5) Project Schedule
Please remember:
Activity duration estimates will effect cost estimates:
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8
Activity duration estimates will effect cost estimates:
a) Where project budget includes an allowance for
the cost of financing (including interest charges),
b) Where resources are applied per unit of time for
the duration of activity,
c) Where we have time-sensitive costs (materials
with seasonal cost variations, union labor with
regularly expiring collective bargaining
agreements).
6) Scope Baseline
A) Scope Statement: provides product
description, acceptance criteria, key
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9
description, acceptance criteria, key
deliverables, project boundaries, assumptions
and constraints about the project.
IMPORTANT: Clarify whether you will include only
direct costs or indirect costs too.
Indirect cost are those which can be directly traced
to a specified project. Your accounting procedure
will decide how to apportion them among various
projects.
6) Scope Baseline
Most common constraints for projects is a LIMTED
Project Budget.
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Project Budget.
Other constraints: required delivery dates, available
skilled resources, organizational policies.
B) Work Breakdown Structure: provides
relationships among all the components of the
project and the project deliverables.
C) WBS Dictionary: WBS dictionary and related
documents provide identification of the deliverables
and description of work required to produce each
deliverable.
Expert Judgment
Cost estimates are
Estimate Costs Tools & Techniques
Expert judgment, guided by
historical information,
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Cost estimates are
influence by numerous
variables:
1) Labor rates
2) Material costs
3) Inflation
4) Risk factors, and
5) Other factors.
historical information,
1) provides valuable insight
about environment and info
from past projects,
2) can help determine
combination of estimating
methods, and reconcile
difference between them.
is top-down estimating that uses
actual costs of similar, past
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2
actual costs of similar, past
project as ground for cost
estimation on present project.
It is a form of expert judgment
and used only in early phases
when detailed information about
the project is not there.
Most reliable when when previous
project are similar in fact not just in
appearance, and when estimators
have needed experience.
L 1
L 2
L 3
L 4
TOP-DOWN TOTAL PROJECT COST
COST FLOW
estimating cost of individual
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3
work packages or schedule
activities and then rolling
them up to higher levels for
reporting and tracking
purposes. find project cost
Parametric modeling
Here, we use project characteristics
(parameters) in a mathematical model to
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4
estimate project costs.
Example: lines of code in s/w
development, required labor hours,
square footage in construction.
This method is reliable only when:
a) Historical information used to develop
model is correct,
b) The parameters are quantifiable, and
c) the model is scalable.
Computerized tools
Widely used to facilitate the
process of cost estimation. There
are many project management
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5
are many project management
spread sheets and simulation
and statistical tools- some of
them you must already be using.
vendor bid analysis (Other
cost estimating methods)
For example, you are able to
estimate costs of procurement
items during vendor bid analysis.
Reserve analysis
Most cost estimates include contingency
for known-unknowns (identified risk).
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6
This overstates the estimate
(pessimistic) and needs to be
tackled.
Solution 1: add up contingencies for
related schedule activities and put
this total contingency in a non-
schedule activity with zero duration.
Place it across the network path.
Like at work package level assign it
to work package subnet to a zero-
duration activity that runs from start
to end.
Reserve analysis
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tackled.
Solution 1: the contingency reserve, as
measured by the resource
consumption by performing the
work package activities, can be
adjusted. Thus cost variances will
be more accurate and not based on
pessimistic estimate of contingency
reserve.
Reserve analysis
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tackled.
Solution 2: put the contingency reserve
at the end of CP. The contingency
reserve, as measured by the
resource consumption by
performing the work package
activities, can be adjusted. Thus
cost variances will be more
accurate and not based on
pessimistic estimate of contingency
reserve.
Please remember!
Contingency reserves must be used at the
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9
Contingency reserves must be used at the
discretion of the project manager to deal with
known unknowns,
anticipated but uncertain events.
What about management reserves?
Cost of quality
Considered while developing cost estimates.
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1) Cost of prevention
2) Cost of appraisal
if not provided, then incur cost of failure,
that is many times of above two.
Just consider how risky are your
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1
We can improve the accuracy by
finding three-point estimates and
then take their average:
1) Most likely
2) Optimistic
3) pessimistic
1) Most likely: duration considering
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2
productivity, availability,
dependencies on their
participants, and interruptions.
2) Optimistic: best case of most
likely.
3) Pessimistic: worst case of most
likely.
1) Activity cost estimates
Quantitative approximation of costs
to be incurred on the resources to
Estimate Costs OUTPUTS
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to be incurred on the resources to
complete project activities. It
includes inflation allowance and
cost reserve. We can present them
in summary form or detailed form
as per the requirement.
2) Basis Of Estimates
Document contains:
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4
Description of the scope of work estimated by
reference to WBS
Basis for estimation
Assumptions made
An indication of possible results
Any other application area specific information
3) Project Document Updates
may include
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5
The Risk register
Determine Budget
Issue
Solution
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6
How to have a cost baseline
for measuring and
monitoring cost performance?
Aggregate cost estimates
of activities or work
packages to establish a
COST BASELINE!
Issue
Determine Budget
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7
Please remember!
COST BASELINE includes all authorized budgets,
but EXCLUDES management reserves!!!
Please dont forget it!
Project budgets constitutes the funds allowed to
execute the project. Cost performance is measured
against the authorized budget!
Determine Budget
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Planning Core Processes
REAL LIFE SCENARIO
In real life, the cost estimates are made after the
budgetary approval has been given, but we
should try to make estimates before we present
request for budget!
WE should prepare cost estimates before budget
requests and work authorization!
TOOLS &
Determine Budget process overview
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Activity cost estimates
Basis Of Estimates
Project Schedule
Resource calendars
Contracts
Scope Baseline
OPAs
INPUTS
TOOLS &
TECHNIQUES
Cost aggregation
Reserve analysis
Expert Judgment
Historical
Relationships
Funding limit
reconciliation
OUTPUTS
Cost Performance
Baseline
Project funding
requirements
Project Document
Updates
Project Cost Management - Inputs
Determine Budget
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provide estimates of schedule
activities within a work
package which are added up to
get cost baseline for each work
package.
Basis Of Estimates
Determine Budget
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1
Basis Of Estimates
guides cost budgeting as any
basic assumptions dealing
with the inclusion or exclusion
of indirect costs in the project
budget is specified in the basis
of estimates.
Project schedule
Determine Budget
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2
Project schedule
provides start and finish dates of
the activities, schedule
milestones, work packages,
planning packages, and control
accounts.
This information helps to
aggregate costs to the calendar
periods when the costs are
planned to be incurred.
Resource calendars
provide information on which resources
Determine
Budget
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provide information on which resources
are assigned to the project and when
They are assigned. This in formation is
used to indicate resource rates over the
Duration of the project.
Contracts
Applicable contract info and costs
are included while determining the
budget.
- existing cost budgeting-related
policies, procedures, and guidelines,
Determine
Budget
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policies, procedures, and guidelines,
- Cost budgeting tools,
- Reporting formats.
Scope Baseline
a) Scope statement: provides formal
limitations by period for expenditure of
project funds can be mandated by the
organization, by contract or by the
other entities, such as government
agencies.
Scope Baseline
b) Work breakdown structure: provides
relationships among all the project
Determine
Budget
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relationships among all the project
deliverables and their various
complements.
c) WBS dictionary (and related detailed
statements) : provide an identification
of the deliverables and a description of
work in each WBS component needed
to produce each deliverable.
1. Cost aggregation
Activity estimates are added up
by work packages. Work
Project Cost Management- Tools & Techniques
Determine Budget
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by work packages. Work
package estimates are added
up for higher component levels
of WBS (control accounts) and
finally for the entire project.
2. Reserve analysis
Reserve analysis establishes
contingency reserves. Here, we
Determine Budget
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contingency reserves. Here, we
establish management
contingency reserves: budgets for
reserved for unknown
unknowns.
These budgets are not part of cost
baseline and are not considered in EV
calculations. Project manager has to
obtain management approval before
spending them.
3. Expert Judgment
Judgment provided based upon
expertise in an application area,
Determine Budget
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expertise in an application area,
knowledge area, discipline,
industry, etc., as appropriate for
the activity being performed should
be used in determining budget.
4. Historical relationships
Any historical relationships that result in
parametric estimates or analogous estimates
Funding limit reconciliation
Large expenditure of funds is
undesirable for organizational
operations.
Hence, expenditure of funds is
reconciled with funding
disbursement limits set by the
customer or performing organization.
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parametric estimates or analogous estimates
involve the use of project characteristics
(parameters) to develop mathematical models to
predict total project costs.
Such models may be simple (construction based
on cost per square foot) or complex (model of
software development costing multiple separate
adjustment factors, each of which has numerous
points in it- Function Point Analysis).
4. Historical relationships
Both the cost and accuracy of analogous and
parametric models varies widely. They are helpful
Funding limit reconciliation
Large expenditure of funds is
undesirable for organizational
operations.
Hence, expenditure of funds is
reconciled with funding
disbursement limits set by the
customer or performing organization.
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parametric models varies widely. They are helpful
only when:
Historical information used to develop is
accurate
Parameters used are readily quantifiable
Models are scalable.
5. Funding limit reconciliation
Expenditure of funds should be reconciled with
any funding limits on the commitment of funds for
Determine Budget- Tools & Techniques
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any funding limits on the commitment of funds for
the project.
A variance between funding limits and planned
expenditure leads to the rescheduling of work.
Cost Performance baseline
IT IS A TIME-PHASED BUDGET
Determine Budget - Outputs
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IT IS A TIME-PHASED BUDGET
ONLY.
Used for measuring and
monitoring the cost performance-
actual cost versus allocated cost.
Displayed in the form of S-curve
Cost baseline, Cash Flow and Funding
COST BASELINE FUNDING REQUIREMENTS
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MANAGEMENT RESERVE
Difference between
the maximum funding
And the end of the cost
Baseline.
TIME
C
U
M
M
U
L
A
T
I
V
E

V
A
L
U
E
S
Project funding
requirements
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requirements
Total or periodic are derived
from cost baseline.
May include an additional
margin to allow for either early
progress or cost overruns.
Project funding
requirements
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5
Total funds required= cost baseline
+ management contingency
reserve. Each funding may include
some part of management
contingency or it may be given only
when needed (depends on organization's
policies).
include
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6
include
- risk register
- cost estimates
- project schedule
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Processes include all activities of the
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Processes include all activities of the
performing organization that determine:
Quality policy, objectives, and
responsibilities to ensure project satisfies
the needs for which it has been
undertaken
Implements the quality management system
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Implements the quality management system
through:
Quality policy, procedures and processes of Plan
Quality, Perform Quality Assurance, and
Perform Quality Control- WITH CONTINUOUS
PROCESS IMPROVEMENT ACTIVITIES
performed throughout!
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Quality is delivering to satisfy the customer.
A quality-oriented project has two aims:
1) To produce the correct end-item
2) To produce it in the correct way
1) To produce the correct end-item:
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1) To produce the correct end-item:
Concerns the product of the project
Addressed through good definition of user
requirements and project objectives
If the requirements and objectives specification
(from the relevant phase) are clear, accurate, and
complete, the project will be headed toward
producing the correct end-item.
2) To produce it in the correct way:
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2) To produce it in the correct way:
Concerns the process of conducting the
the project and ensures it actually
produces the end-item according to the
requirements
Addressed by a good project quality plan which ensures that
the work performed will result in an end-item that conforms to
prescribed user and project requirements and continues to do
so after the end-item is put to operation (QUALITY OF CONFORMANCE)
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Attention to quality requires:
Continuous review of project progress
Checking that the product of the project is meeting
user requirements
Checking that the user requirements and project
objectives are satisfying changing customer needs
The quality plan specifies the measures and procedures for:
1) monitoring and comparing work output with requirements
2) comparing requirements with current needs and realities
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Attention to quality continues even after the
project is completed:
by monitoring the end-item for how well it
continues to perform and meet customer
needs
This monitoring ( done by the customer or contractor)
provides information to suggest FUTURE
DESIGNS or SOLUTIONS which are:
Attention to quality continues even after the
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1) completely new, or
2) improvements upon existing products
and systems
QUALITY PLAN MUST SPECIFY THE MEASURES AND
PROCEDURES FOR MONITORING OPERATIONAL
PERFORMANCE!
THE CONCEPT
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THE CONCEPT
Quality is the totality of characteristics of an entity
that bear on its ability to satisfy stated or implied
needs.
IN OTHER WORDS, it is the degree to which a set
of inherent characteristics fulfill requirements.
Stated or implied needs, therefore, needs guide us
in developing project requirements.
THE CONCEPT
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THE CONCEPT
In project context, the key issue is converting
IMPLIED NEEDS INTO REQUIREMENTS- through
project scope management.
Quality therefore is conformance to requirements and
fitness for use.
This means you must produce what you promised to
produce and the product must be fit for use for which it
is meant.
THE CONCEPT
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THE CONCEPT
Quality must be planned in,
not inspected in.
THE CONCEPT
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THE CONCEPT
No GOLD PLATING. No customer extras,
no extra functionality, no higher quality
components, no extra scope of work or
better performance.
THE CONCEPT
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THE CONCEPT
Low quality is a problem,
low grade is not.
THE CONCEPT
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THE CONCEPT
GRADE (a category assigned to product/services)
- same functional use
- different technical characteristics
Example: a software product
HIGH QUALITY: readable manual, no defects
LOW GRADE : limited features
THE CONCEPT
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THE CONCEPT
Example: a software product
LOW QUALITY : poorly organized manual, many defects
HIGH GRADE : numerous features
THE PROJECT MANAGEMENMT TEAM MUST
DETERMINE AND DELIVER THE REQUIRED
LEVELS OF BOTH: QUALITY, and GRADE.
THE CONCEPT
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3
THE CONCEPT
Precision and accuracy: two different things
1) PRECISION IS CONSISTENCY ( the value of repeated
measurements are clustered and have little scatter).
2) ACCURACY IS CORRECTNESS ( the measured value
is very close to true value).
THE CONCEPT
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THE CONCEPT
A PRECISE MEASUREMENT IS NOT NECESSARILY
AN ACCURATE MEASUREMENT!
A VERY ACCURATE MEASUREMENT IS NOT
NECESSARILY PRECISE!
THE CONCEPT
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THE CONCEPT
IT IS PRIME RESPONSIBILITY OF THE PROJECT
MANAGEMENT TEAM TO DECIDE:
how much precision or accuracy or both are
needed
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THE CONCEPT
PROJECT QUALITY MANAGEMENT IS COMPATIBLE WITH:
ISO 9000 and 10000 series
Proprietary quality management approaches (Deming,
Juran, Crosby, and others)
Nonproprietary approaches (TQM, Six Sigma, FMEA,
Design Reviews, Voice of Customer, COQ,
and Kaizen (continuous improvement)
THE CONCEPT
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THE CONCEPT
Hence, Modern quality management complements
Project Quality Management. Both advocate the same
tenets:
Customer satisfaction
Prevention over inspection
Management responsibility
Continuous improvement
THE CONCEPT
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8
THE CONCEPT
CUSTOMER SATISFACTION
understanding, evaluating, defining, and managing
expectations to fulfill customer requirements
THIS NECESSITATES A COMBINATION OF
1) Conformance to requirements
the project MUST produce what it said it would
THE CONCEPT
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THE CONCEPT
CUSTOMER SATISFACTION
2) Fitness for use
the product/service MUST satisfy the REAL NEEDS
THE CONCEPT
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THE CONCEPT
PREVENTION OVER INSPECTION
THE COST OF PREVENTING MISTAKES IS
NORMALLY MUCH LESS THAN THE COST
OF CORRECTING THEM (DEMONSTRATED BY
INSPECTION)
THE CONCEPT
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THE CONCEPT
MANAGEMENT RESPONSIBILITY
success needs participation of all team members, but
it stays with the management to provide resources
required to succeed.
Deming suggested: as much as 85% of the cost of
quality is management problem
THE CONCEPT
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THE CONCEPT
Deming suggested: once the quality issue has hit the
floor, or the worker level, the workers have little control
THE CONCEPT
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3
THE CONCEPT
A company had bid on the an Express Highway Project
and won it.
To earn more profits, management decided to use
inferior-grade asphalt. The workers laying the asphalt
have little control over its quality.
REAL LIFE SCENARIO
THE CONCEPT
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4
THE CONCEPT
CONTINUOUS IMPROVEMENT
PDCA (plan-do-check-act) Cycle, defined by Shewhart
and modified by Deming, forms the basis for quality
improvement
THE CONCEPT
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THE CONCEPT
CONTINUOUS IMPROVEMENT
Quality improvement initiatives (TQM, SIX SIGMA)
can contribute in improving the quality of both:
1) Project management, and
2) The projects product
Process improvement models (Malcolm Baldrige,
CMM, CMMI) also provide useful guidance.
THE CONCEPT
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Key difference project team MUST know:
Projects are too temporary to reap the rewards of
investments in product quality improvement (mainly
defection prevention, appraisal), hence performing
organization must bear these investments!
THE CONCEPT
THE CONCEPT
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THE CONCEPT
Project quality management addresses both:
Management of the project
Management of projects product
We MUST succeed in meeting quality requirements for
both:
a) Project
b) Product of the project
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THE CONCEPT
Our inability to meet quality
requirements either of the project or
product of the product leads to
SERIOUS NEGATIVE IMPACT FOR
STAKEHOLDRES.
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THE CONCEPT
Satisfying customer requirements by over-
stretching project team leads often to their
quitting the organization subsequently.
Accomplishing project schedule by hurrying
planned quality inspections generally leads to
negative impact when defects go unchecked.
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Processes consist of all the activities of the
performing organization that determine quality
policies, objectives, and responsibilities to
ensure:
PROJECT WILL SATISFY THE NEEDS FOR WHICH
IT WAS UNDERTAKEN
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IMPLEMENTS the quality management system
Through:
a) The policy
b) Procedures
c) Processes
Quality Planning
Quality Assurance
Quality Control
OF
CONTINUOUS PROCESS IMPROVEMENT ACTIVITIES THROUGHOUT
Plan Quality
Quality metrics
Project
management
plan
A
Standards &
Regulations
Quality policy
Project plan updates
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Perform Quality
Assurance
Perform Quality
Assurance
Perform Quality
Control
Quality metrics
Checklists
Quality baseline
Integrated
Change
control
Quality control measurements
Recommended corrective/
preventive actions/defect repair
OK deliverables
Change requests
Corrective action
Change requests
A
P
P
R
O
V
A
L
S
Scope statement
Product
description
Other planning
outputs
Other
Planning
Processes
I
N
P
U
T
S
t
o
Approved
Change requests
Plan Quality
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The process of
Identifying quality requirements and
standards for the project and the product
and documenting how the project will
demonstrate compliance.
Plan Quality
IMPORTANCE
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4
IMPORTANCE
One of the key processes while performing
Planning Process Group and developing the Project
Management Plan
Must be performed in parallel with other planning
processes.
WHY?
Plan Quality
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5
BECAUSE
1) The required changes in the product to meet quality
standards MAY REQUIRE SCHEDULE AND COST
ADJUSTMENTS! OR
2) The desired product quality MAY NEED DETAILED
RISK ANALYSIS OF AN IDENTIFIED PROBLEM!
Plan Quality process overview
Enterprise
Environmental
factors
INPUTS
TOOLS &
TECHNIQUES
Cost-benefit
Analysis
OUTPUTS
Quality Management
Plan
Quality metrics
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6
factors
assets
Scope Baseline
Stakeholder Register.
Cost Performance Baseline.
Schedule Baseline
Risk Register
Analysis
Benchmarking
Design of
Experiments
Cost of quality
(COQ)
Additional quality
planning tools
Control Charts
Statistical sampling
Flowcharting
Proprietary Quality
Management
Methodologies
Quality metrics
Quality Checklists
Process improvement
plan
Project document
updates
1. Enterprise environmental Factors
provide:
- Standards and regulations
Plan Quality - INPUTS
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7
- Standards and regulations
- Rules, standards, and guidelines specific
to the application area, and
- Working/ operating conditions of the
project/ product which may affect quality.
2. Organizational process assets
provide:
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provide:
a) Quality policy, procedures and guidelines,
b) historical database, and
c) lessons learned.
Quality policy sets the intended direction of a
performing organization with regard to quality.
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performing organization with regard to quality.
Quality policy of the performing organization for
their products can be adopted as is for use on
the project. BUT if there is no quality policy or
multiple organizations are involved, then the
project management team should develop a
quality policy for the project with knowledge of the
stakeholders.
3. Scope Baseline.
- A. Scope statement: contains the product
description, major project deliverables, and
acceptance criteria. The product description contains
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description, major project deliverables, and
acceptance criteria. The product description contains
details of technical issues and other concerns that
can affect quality planning. The definition of
acceptance criteria can significantly increase or
decrease project costs and quality costs. Satisfying
acceptance criteria means the needs of the customer
have been met.
- B. WBS: identifies the deliverables, the work
packages and the control accounts used to measure
project performance.
Scope Baseline.
- C. WBS dictionary: defines technical information for
WBS elements and must be considered during quality
planning.
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WBS elements and must be considered during quality
planning.
4. Cost Performance baseline
documents the accepted time phase used to measure
cost performance. Quality must be achieved within
this time-phased budget.
5. Risk Register
provides threats and opportunities that may impact
quality requirements
6. Schedule Baseline
accepted schedule within which quality parameters
should be achieved.
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should be achieved.
7. Stakeholder Register
identifies stakeholders with a particular interest , or
impact on quality.
Plan Quality Tools & Techniques
1. Cost/Benefit analysis
analyze cost-benefits tradeoffs
Primary benefit of meeting Quality
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3
Primary benefit of meeting Quality
Requirements:
BENEFITS
1. LESS REWORK
2. HIGHER PRODUCTIVITY
3. LOWER COSTS
4. INCREASED STAKEHOLDER
SATISFACTION
1. Cost/ Benefit analysis
PRIMARY COST OF PROJECT
QUALITY MANAGEMENT ACTIVITIES
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4
QUALITY MANAGEMENT ACTIVITIES
COSTS
TRAINING
SURVEYS
STUDIES
APPRAISAL
DESIGN REVIEW
2. Benchmarking
Purpose: To generate ideas for improvements and
offer standards to measure performance.
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offer standards to measure performance.
Method: We compare the actual or planned projects
practices to those of other projects.
Sources: These projects can be:
a) within performing organization or outside
b) Within same application area or in another
Application area
3. Design of experiments (DOE)
An analytical technique that identifies the elements,
or variables, that will have impact on overall project
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6
or variables, that will have impact on overall project
outcomes.
Generally, this method is used concerning the product
of the project but can also be applied to project
management processes.
This process designs and sets up experiments to
determine the ideal solution for a problem utilizing a
Limited number of sample cases.
4. Cost of quality
Consists of all our costs on efforts to:
Achieve product / service quality
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7
Achieve product / service quality
Ensure conformance to requirements
Work resulting from nonconformance to requirements
Plan Quality Tools & TechniquesPlan Quality
Cost of quality
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THREE TYPES OF COSTS
ARE INCURRED:
1. Prevention costs
2. Appraisal costs
3. Failure costs
Cost of quality
Prevention costs
Prevention means keeping defects
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9
Prevention means keeping defects
out of the hands of the customer.
These costs are associated with
producing a product/service without
defects in order to satisfy Customer
Requirements.
Example: quality planning, training,
design review, contractor and
supplier costs
Cost of quality
Appraisal costs
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Appraisal costs
Expended to examine the product or
process and make certain that the
Requirements are being met.
Examples: inspection, testing
Cost of quality
Failure costs
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1
Failure costs
Are the costs incurred when things
dont happen according to the plan:
1) Internal failure costs
result when customer requirements
are not satisfied and the product
is still in the control of the
performing organization
Example: corrective action, rework,
scraping, and downtime
Cost of quality
Failure costs Failure costs
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2
dont happen according to the plan:
2) External failure costs
result when the product has
reached the customer and they
determine that their requirements
have not been met.
Example: inspections at customers site
returns, and customer service
costs
COST OF POOR QUALITY: FAILURE COSTS!
5. Flow charting
It is any diagram that shows logical steps that must be
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performed to accomplish an objective.
It displays how individual elements of a System
interrelate.
In the case of quality management,two types of flow
charts are used:
Cause-and-effect diagrams (Ishikawa diagrams,
fishbone diagrams) show relationship between various
factors (causes) to potential problems/effects.
5. Flow charting
Cause-and-effect diagrams (Ishikawa
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4
Cause-and-effect diagrams (Ishikawa
diagrams, fishbone diagrams) show
relationship between various factors (causes)
to potential problems/effects.
Process flow diagram
PROCESS
EXAMPLE:CAUSE-AND-EFFECT DIAGRAM
MATERIAL MACHINE TIME
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5
ENVIRONMENT
PROJECT
TEAM
MAJOR
DEFECT
ENERGY MEASUREMENT
System or process flow
charts
Show the logical steps needed to
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6
Show the logical steps needed to
accomplish an objective and
interrelation of individual elements
of a system.
These charts assist project team
to assess the type and area where
quality problems may appear.
EXAMPLE: Process Flowchart
1. Project Request
2. Compliance Copy
N = No
Y = Yes
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7
N
N
N
Y
Y
Y
9. QA Review /
Approval
8. Package development
Review / Approval
4. Artwork Approved
3. Develop Artwork
5. Change Control for Specs
6. Artwork out for Proofs
12. ORDER MATERIAL
7. Vendors make Proofs
11. SPSECS SIGNED
(PACKAGE AND QA)
2. Compliance Copy
10. Approved Proofs back to Vendor
6. Control Charts
Used to determine whether or not process is stable
or has predictable performance.
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or has predictable performance.
Upper and lower specification i are set based on the
requirements, reflecting minimum and maximum
values allowed.
There may be penalties for crossing these limits.
For repeatable processes are generally +/- 3 sigma!
6. Control Charts
A process is out of control when data points cross
the limits or seven consecutive points are above or
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9
the limits or seven consecutive points are above or
below the mean, although inside the control limits.
Control charts are used to monitor various types of
variable outputs.
6. Control Charts
Generally, control charts are used to track
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Generally, control charts are used to track
repetitive activities for producing manufactured
lots, but may also be used to monitor schedule
and cost variances, volume and frequency of
scope changes, other management results to
determine if management processes are in
control!
7. Statistical Sampling:-
It involves choosing part of a population of
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It involves choosing part of a population of
interest for inspection.
Sample frequency and sizes should be
determined during the plan quality process
so the cost of quality will include the no. of
tests, expected scrap, etc.
8. Additional quality planning tools:
Brainstorming
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2
Brainstorming
Flowcharting
Force field analysis
Matrix diagrams
Nominal group techniques
Affinity diagrams
Prioritization techniques
9. Proprietary Quality Management
Methodologies
- Six Sigma
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3
- Six Sigma
- Lean Six Sigma
- Quality Function Deployment.
- CMMI, etc
WOW!
Plan Quality OUTPUTS
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4
WOW!
We have done so much!
Lets examine our outputs.
describes how the project management
team will implement its quality policy
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5
team will implement its quality policy
Details the project quality system that
Includes:
Organization structure
Responsibilities
Procedures
Processes, and
resources
REQUIRED TO IMPLEMENT
PROJECT
QUALITY
MANAGEMENT
PROVIDES input to overall project plan
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6
PROVIDES input to overall project plan
Addresses QC, QA, and CONTINUOUS
IMPROVEMENT for the project
MUST include efforts at the front end of
the project to make sure that the earlier
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7
the project to make sure that the earlier
decisions on:
Concepts, designs, and tests ARE
CORRECT
This should be done through independent
Peer Review.
Benefits of the review:
reduction of schedule and cost overruns
due to rework
Quality metrics (Operational definitions)
A quality metrics is an operational definition that describes, in
very specific terms
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8
1) a project or product attribute and
2) how the quality control will measure it.
Examples:
1) On-time performance,
2) Budget control,
3) Defect frequency,
4) Failure rate,
5) Availability,
6) Reliability, and
7) Test coverage.
Quality metrics (Operational definitions)
A measurement is an actual value. The tolerance
defines the allowable variations on the metrics
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9
defines the allowable variations on the metrics
Example:
A metric related to the quality objective of staying
within the within the approved budget by +/- 10% could
be to measure the cost of every deliverable and
determine the percent variance from the approved
budget for that deliverable.
Quality metrics are used in Quality Assurance
and Quality Control.
Quality Checklists
It is a component specific, structured tool used to
verify a set of required steps has been performed.
Plan Quality - OUTPUTS
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verify a set of required steps has been performed.
A do this list, or have you done this monitor!
These lists ascertain consistency in frequently
performed tasks.
Most organizations have it, or you can get one from
commercial service providers or professional
associations.
details steps for analyzing processes to identify activities
which enhance their value.
Process boundaries defining purpose, start and
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1
1) Process boundaries defining purpose, start and
end of processes, inputs, outputs, data required,
process owner, and process stakeholder.
2) Process configuration, a flowchart of process to
help analysis with identified interfaces.
3) Process metrics to maintain control over status of
processes.
4) Targets for improved performance, guides
process improvement activities.
- Stakeholder Register.
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2
- Responsibility Assignment
Matrix
Project Human Resource Management
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3
HR
HR
HR
HR
HR
HR
THE CHALLENGES
Most project managers have considerably more
responsibility than authority, so they need different
HR
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4
responsibility than authority, so they need different
skills and approaches than traditional managers.
Stakeholders often have different needs and
perspectives, but project manager has to balance
them, and yet achieve project objectives.
Generally, project staff comes from various
functional areas and do not report to the project
manager, but he has to get work done by them.
THE CHALLENGES
Project mangers role is so central that without it
there would be no such thing as project
HR
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5
there would be no such thing as project
management. But he/she has to wear lot of different
hats, many at the same time. He/she has to be an
integrator, communicator, decision maker, motivator,
entrepreneur, and change agent.
The Project Manager has to make most effective use
of all project stakeholders- sponsor, customer,
functional managers, individual contributors, etc.
Look at his task!
THE CHALLENGES
Managing people on projects involves:
Key General Management Skills, like leading,
HR
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Key General Management Skills, like leading,
communicating, negotiating, problem solving, and
influencing organization.
Dealing with individuals- delegating, motivating,
coaching, mentoring, etc.
Dealing with groups- team building, solving conflicts,
etc.
Administering the human resource function. May
also have the responsibility of HR redeployment and
release (depends on where they belong).
THE CHALLENGES
Further, application of these behavioral and HR
Management skills is different on projects than in
HR
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7
Management skills is different on projects than in
operations because:
Personal and organizational relations on projects
are transient and new (as projects are temporary).
Often the number and type of stakeholders change
as project phase changes leading to the issue of
adopting new techniques as old ones may not apply
in another phase.
THE CHALLENGES
The project manager and project team must know
HR
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The project manager and project team must know
administrative requirements to ascertain compliance,
even though HR Administration activities are not their
responsibility.
All this poses great managing problems for
the project manager and project team, and
they must understand things involved in
advance to address them properly.
Consists of:
processes needed to organize and manage the project
team, the people who are assigned roles and
HR
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team, the people who are assigned roles and
responsibilities for completing the project.
Apart from assigning roles, we must involve the team
members in planning and decision making. WHY?
Early involvement of team members ADDS
EXPERTISE DURING PLANNING PROCESSES
AND ALSO ENSURES COMMITMENENT!
Whats the difference between project team
and project management team ?
HR
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Project team: All the project team members, including
project management team, the project manager and,
for some projects, project sponsor.
Project management team: A subset of project team.
The group is called core, executive, or leadership
team and is responsible for project management
activities like planning, controlling and closing.
Develop
Project
management
plan
HR
Develop HR Plan
Roles and Responsibilities
Project Organization Charts
Staffing Management Plan
A
EEFs
HR Requirements
Organization
Culture and
Structure
Templates
Checklists
Project managnt.
plan
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Integrated
Change
control
Performance reports
Work Performance reports
O P A
Updates
Project staff assignments
Resource availability
Staffing management plan updates
Project plan management
updates
Requested
Changes
Recommended P
& C actions
Approved Change
requests
Approved corrective/
Preventive actions
A
P
P
R
O
V
A
L
S
Close project
Direct & manage
Project Execution
Report
Performance
Estimate activity
resources
Manage project team
Team Performance
assessment
OPAs
Checklists
Determines project roles, responsibilities, and reporting
relationships. Project roles can be assigned to persons
or groups, inside or outside the organization performing
HR
Develop Human
Resource Plan
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or groups, inside or outside the organization performing
the project.
The output is staffing management plan that describes:
1) How and when team members will be acquired
2) Criteria for releasing them
3) Training needs
4) Recognition & reward plans
5) Compliance considerations
6) Safety issues
7) Effect of staffing management plan on the organization
Done as part of earliest phases of the
project
HR
Develop Human
Resource Plan
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project
Its results are reviewed throughout project
to ascertain continued applicability
Is closely linked with communications
planning because organization structure
has significant influence on communication
needs of the stakeholders
Develop Human Resource Plan
Is the process of
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4
Is the process of
1) identifying and documenting project roles,
2) Responsibilities and required skills,
3) reporting relationships, and
4) Creating a staffing management plan.
Human Resource Plan documents:
- Project roles and responsibilities
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- Project roles and responsibilities
- Project organization charts
- Staffing management plan
(including timetable for staff
acquisition and release, training needs,
team-building strategies).
IMPORTANT
Staffing management plan includes
a) Timetable for staff acquisition and release,
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a) Timetable for staff acquisition and release,
b) Training needs,
c) Team-building strategies,
d) Plan for recognition and rewards programs,
e) Compliance considerations,
f) Safety issues, and
g) Impact of staffing management plan on the
organization.
IMPORTANT consideration should be given to
The availability of or competition for, scarce
or limited resources.
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or limited resources.
These resources may be inside or outside
the performing organization.
Other projects may be competing for same
skill sets.
IMPORTANT
These factors may significantly affect
project costs, schedules, risks, quality, and
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project costs, schedules, risks, quality, and
other areas.
Effective human resource planning must
consider these factors and plan for for them
and develop human resource options!
Develop Human Resource Plan process view
INPUTS
TOOLS &
TECHNIQUES
OUTPUTS
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9
Enterprise
environmental
factors
Organizational
process
assets
Activity Resource
Requirements
INPUTS
TECHNIQUES
Organization charts
and position
descriptions
Networking
Organizational
Theory
OUTPUTS
Human Resource Plan
factors
Definition of roles and responsibilities on the
HR
Develop Human
Resource Plan
INPUTS
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Definition of roles and responsibilities on the
project is evolved with an understanding of :
1) The ways that existing
organizations will be involved
2) How the technical disciplines will
interact with each other
3) How people currently will interact
with one another
INPUTS
Commonly occurring enterprise
environmental factors involving
organizational culture and
HR
Develop Human
Resource Plan
INPUTS
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organizational culture and
structure
1) Organizational Interfaces
2) Technical Interfaces
3) Interpersonal Interfaces
4) Logistical
5) Political
INPUTS
HR
Organizational interfaces
1) which organizations /
departments will participate in
Develop Human
Resource Plan
INPUTS
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departments will participate in
the project
2) what are present working
arrangements among them
3) what formal / informal
relationships prevail among
them(could be highly complex or
quite simple).
INPUTS
HR
Project interfaces
REAL LIFE SCENARIO
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Delhi Metro Project has engaged 38 contractors ( 33 Indian,
5 International) to work over several years. The reporting
relationships are pretty complex. Various technical disciplines
also interface.
BSNL Voice Clarity Project at Greater Noida site was a simple
in-house project that did not offer such interface complexity.
Technical interfaces
1) What are different technical
HR
Develop Human
Resource Plan
INPUTS
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1) What are different technical
disciplines and specialties that
will be required to accomplish
the project
2) Are there various types of:
a) engineering approaches
b) software languages
c) equipments
THAT NEED TO BE COORDINATED!
INPUTS
HR
Technical interfaces
3) Whether transitions from one
Develop Human
Resource Plan
INPUTS
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5
3) Whether transitions from one
life cycle phase to another
pose unique challenges
TECHNICAL INTERFACES
EXIST BETWEEN
PHASES AS WELL AS WITHIN
PHASES
INPUTS
HR
Project interfaces
REAL LIFE SCENARIO
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6
In L & T Cement Project, the site design made by civil
engineers needed to correspond with the superstructure
developed by structural experts.
In Honda- Siel Project, the fabrication design team passed
work results to construction team to begin plant
construction.
Interpersonal interfaces
1) What types of formal and
informal reporting relationships
obtain among the prospective
HR
Develop Human
Resource Plan
INPUTS
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obtain among the prospective
project team members
2) What are their superior-
subordinate relationships
3) What are their supplier-customer
relationships
4) What cultural and language
differences will impact working
relationships among them
5) What levels of mutual trust and
respect presently exists
INPUTS
HR
Logistical
how much distance separates project
Develop Human
Resource Plan
INPUTS
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8
how much distance separates project
people and units
Are project people located in different:
1) buildings
2) time zones
3) countries
INPUTS
Political
1) What are the individual goals and
HR
Develop Human
Resource Plan
INPUTS
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1) What are the individual goals and
agendas of Prospective project
stakeholders
2) Which groups and people posses
informal power in the areas
significant to the project
3) What informal alliances exist
INPUTS
In addition to these EEFs:
Constraints that limit flexibility of HR
HR
Develop Human
Resource Plan
INPUTS
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0
Constraints that limit flexibility of HR
Planning:
Collective bargaining agreements
Economic conditions
INPUTS
HR
ORGANIZTION STRUCTURE CONSTRAINTS
If you work in a functional organization, you will face lot
Develop Human
Resource Plan
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If you work in a functional organization, you will face lot
of difficulties in acquiring resources from iron walls of
various functional departments.
Here, the authority over resources lies with functional
managers. You are called project manager, but in fact
you just and an expeditor.
You are more comfortable in strong matrix because you
have authority to direct resources and deploy for
project work.
Collective bargaining
agreements
HR
Develop Human
Resource Plan
INPUTS
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agreements
entered between the organizations and
labor/other employee groups detail
require certain roles and reporting
relationships.
Remember employee groups are
important stakeholders !
INPUTS
Economic conditions
Hiring, freezes, reduced training
HR
Develop Human
Resource Plan
INPUTS
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Hiring, freezes, reduced training
funds, or lack of travel budget
are examples that can limit
staffing options. entered
between the organizations and
INPUTS
Organizational
process assets
with the maturity of project
HR
Develop Human
Resource Plan
INPUTS
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4
with the maturity of project
management methodology,
organizations have HR planning
experiences as Lessons
Learned that helps HR planning
on our present project.
Templates and checklists save
time in the beginning and keep
us from missing important
responsibilities.
INPUTS
assets
1) Templates helps HR planning
HR
Develop Human
Resource Plan
INPUTS
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5
1) Templates helps HR planning
and include:
i. Project organization charts
ii. Position descriptions
iii. Project performance
appraisals
iv. A standard conflict
management approach
INPUTS
assets
2) Checklists helps HR planning
HR
Develop Human
Resource Plan
INPUTS
80
6
2) Checklists helps HR planning
and include:
i. Common project roles and
responsibilities
ii. Typical competencies
iii. Training programs
iv. Team ground rules
v. Compliance & safety issues
vi. Reward ideas
INPUTS
Activity Resource
Requirements
Provides activity resource
HR
Develop Human
Resource Plan
INPUTS
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7
Provides activity resource
requirements and description of
other activities like quality
assurance, risk management
and procurement. For all this,
we need to do HR planning.
Initial requirements of people
and competencies are
elaborated and refined in HR
planning.
INPUTS
HR
organization charts and
position
Mostly three types used to
Develop Human
Resource Plan
TOOLS &
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8
Mostly three types used to
document team member roles and
responsibilities:
1) Hierarchical
2) Matrix
3) Text-oriented
Objective: Each work package must have
an unambiguous owner and all team
member have clear roles and responsibilities!
TOOLS &
TECHNIQUES
HR
Organization chart
Project reporting relationships are
graphically displayed.
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graphically displayed.
Depending on the project needs,
you can make it formal or
informal; broadly-detailed or
highly-detailed.
INR 2 billion Reliance Power Dadri
Project, has mind-boggling
organization chart for about 7000
people.
HR
Organization breakdown
Structure (OBS)
OBS
Develop Human
Resource Plan
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Structure (OBS)
WBS shows how project deliverables
are broken down into work packages
and becomes one way to depict high-level
areas of responsibility. OBS looks similar
but arranged according to departments,
units, or teams: the project activities or
work packages listed under each
Department. This helps each operational
department to see its portion of OBS.
HR
Develop Human
Resource Plan
Resource breakdown Structure
Another hierarchical chart that breaks
RBS
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Another hierarchical chart that breaks
down project by types of resources
Helps tracking project costs, aligned with
the organizations accounting system
RBS of Delhi Metro Project shows all welders
(over 600) and welding machines (630) being
used in different areas of this massive even
though they are scattered in different branches
of Project OBS
PERSON
PHASES
Vikas Rajiv Shasi Manas Mona Rahul .
Excavation
HR
Sample RAM using RACI format
Develop Human
Resource Plan
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R = responsible, A = accountable, C = consult, I = inform
Excavation
A I I I I R
Foundation
I A R C C C
Frame
I C A R I I
Walls and
ceilings
A
R C C C C
Interior
systems
R
I C I I A
HR
RAMs of larger projects
RAMs on larger projects are developed at various
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RAMs on larger projects are developed at various
levels of WBS.
High-level RAM describes the group or unit
accountable for each component of WBS.
Lower-level RAMs assigns roles and responsibilities
for specific activities to concerned persons.
RAM shows connection between work and team
members!
HR
Text-oriented format
Team member responsibilities that
require detailed descriptions can be
Text-oriented format
Role
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require detailed descriptions can be
written here in outline form:
Responsibilities, authority,
Competencies, qualifications
This format is also called:
Position Descriptions and Role-
Responsibility-Authority forms.
Make great templates if updated throughout
current project!
Authority
Responsibilities
HR
Other sections of project
management plan
Develop Human
Resource Plan
INPUTS
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5
We consider team member
responsibilities detailed in other sections
of the project management plan:
1) Risk register lists risk owners
2) Communication management plan lists
people responsible for communication
activities
3) Quality plan lists people responsible for
quality assurance and quality control
activities
INPUTS
HR
Networking
For effectiveness of staffing management
plan options, we must understand
Develop Human
Resource Plan
INPUTS
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plan options, we must understand
political and interpersonal factors that
may impact them. So, we need to use
networking, such as:
1) Proactive correspondence
2) Luncheon meetings
3) Informal conversations
4) Trade conferences
Networking pays from start of the project till
its completion!
INPUTS
HR
Organization theory (OB)
Informs us on the ways people,
teams and organizations behave.
Develop Human
Resource Plan
INPUTS
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teams and organizations behave.
We must use proven principles to
shorten the time needed to arrive
at outputs of HR planning.
It makes planning more effective.
1) Goal-setting
2) Group Dynamics
3) TIP
INPUTS
Develop Human Resource Plan- OUTPUTS
HR
Human Resource Plan includes:-
1) Role and responsibility assignments
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1) Role and responsibility assignments
Role: portion of project for which a
person is accountable
Example Project Roles:
business analyst, civil engineer,
testing coordinator
Role clarity is vital for project success:
- authority
- responsibilities
- boundaries
HR
Role and responsibility
assignments
Authority:
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Authority:
- right to apply project resources
- make decisions
- sign approvals
Clarity about authority is necessary for
project success.
Examples of decisions requiring Clear
Authority:
- quality acceptance
- how to respond to project
variances
HR
Role and responsibility assignments
Responsibility:
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the work team member is expected to
perform to complete project activities
HR
Role and responsibility assignments
Competency:
Skill and capacity needed to accomplish project
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Skill and capacity needed to accomplish project
activities.
Project performance will be adversely affected if
team members do not have necessary
competencies.
Must identify mismatches and make up through:
training, hiring, schedule changes, or scope
changes.
HR
2) Project organization chart
Graphic display of project team member
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Graphic display of project team member
and their reporting relationships.
We have already discussed it.
HR
3) Staffing management plan
Describes how and when HR requirements will be
met.
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met.
Updated regularly during the project to ONGOING
PROJECT TEAM ACQUISITION AND
DEVELOPEMNT.
Made as per the project needs:
- may be detailed or broad
- may be formal or informal
Subsidiary part of the project management plan
HR
Staffing management plan
Contents:
1) Staff acquisition: many questions need to be answered
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1) Staff acquisition: many questions need to be answered
when planning acquisition of team members:
Will they come from within the organization or outside?
Will they need to work at a central location or distant ones?
What costs are entailed with each level of expertise required?
How much help HR depart will extend to project management
team?
HR
Contents:
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5
2) Timetable: necessary time frames
they will be used, plus when
recruitment should begin.
One tool: Resource Histogram: bar chart
showing number of hours that a person,
department, or whole project team will be
required each week or month during the
project.
HR
Contents:
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Contents:
Resource Histogram: may include a
horizontal line maximum number of hours
available from a particular resource.
If bars extend beyond the available resource
hours, we need to use resource leveling
(adding more resources or extending
schedule).
70
80
90
HR
S
t
a
f
f

h
o
u
r
s
Sample Resource Histogram
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0
10
20
30
40
50
60
1st Qtr 2nd Qtr 3rd Qtr 4th Qtr
S
t
a
f
f

h
o
u
r
s
Resource Usage Staff hours
HR
Contents:
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3) Release criteria: determining method and
timing. Benefits project and team members.
Special Attention should be paid to releasing
persons or groups when their work completes.
Benefits of proper reassignment procedures:
1. Lowers costs by reducing the tendency to make work to
fill the time between present and the next assignments
2. Boosts morale by eliminating uncertainty about future
employment
HR
Contents:
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4) Training needs: if training members assigned
are not expected to have necessary
competencies, we need to develop a training
plan as part of the project and also help
them obtain certifications.
HR
Contents:
5) Recognition & rewards: Clear criteria and
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5) Recognition & rewards: Clear criteria and
planned system to encourage and reinforce
DESIRED BEHAVIORS. Must be based on
activities and performance under ones control.
Example: If someone is to be rewarded for
meeting cost objectives, then he/she must be
given authority on matters that affect
expenses.
HR
Contents:
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5) Recognition & rewards: Such a with defined
timeframes ensures that recognition doe take
place and not ignored!
Given as part of the Develop Project Team
process.
HR
Contents:
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6) Compliance: strategies for complying with
applicable government regulations, union
contracts, and other HR policies.
7) Safety: policies and procedures to protect
team members from hazards. Include in Risk
Register also.
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COMMUNICATIONS
THE CONCEPT
Communication
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THE CONCEPT
1. Proper communication is one of the critical success factors.
2. There should be a structured approach to it.
3. Communication needs of all project stakeholders must be
identified in advance:
What they need to be communicated
How they are going to be communicated
When they will to be communicated
THE CONCEPT
Communication
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5
THE CONCEPT
4. This is a very proactive approach and must be adopted on all
projects to ensure smooth working, amicable relations, and
project success.
5. This is particularly more important due the fact that most
project managers do not know what this is, nor do they
realize that individual needs of each stakeholder must be
addressed.
Hence, project communications management employs
Communication
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Hence, project communications management employs
processes needed to ensure timely and appropriate:
1) generation
2) collection
3) distribution
4) storage
5) retrieval, and
6) ultimate disposition
OF PROJECT INFORMATION
project communications management provides:
Communication
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project communications management provides:
CRITICAL LINKS AMONG PEOPLE AND INFORMATION THAT ARE
REQUIRED FOR SUCCESSFUL COMMUNICATIONS
Project managers spend about 90% time communicating:
1) With the project team
2) With the customer
3) With the functional managers
4) With the sponsor
5) With other stakeholders
Everyone involved in the project must understand:
Communication
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Everyone involved in the project must understand:
HOW COMMUNICATIONS AFFECT THE PROJECT
AS A WHOLE
Communication skills (though not same as project
Communication
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9
Communication skills (though not same as project
communications management) have great significance
during Project Communications Management.
MASTERING THE ART OF COMMUNICATION IS VERY
IMPORTANT
MASTERING THE ART OF COMMUNICATION IS VERY IMPORTANT
Communication
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MASTERING THE ART OF COMMUNICATION IS VERY IMPORTANT
IT INVOLVES:
1) Sender-receiver models
2) Choice of media
3) Writing style
4) Presentation techniques
5) Meeting management techniques
Communication
Sender-receiver model
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R
E
C
E
I
V
E
R
DEVELOP
IDEA
ENCODE TRANSMIT RECEIVE DECODE ACCEPT USE
S
E
N
D
E
R
MESSAGE FLOW
1
MESSAGE FLOW
7 6 5 4 2 3
BRRIERS
BRIDGE OF MEANING
8 (FEEDBACK)
IT REQUIRES 8 STEPS: WHETHER TWO PARTIES TALK, USE HAND
Communication
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IT REQUIRES 8 STEPS: WHETHER TWO PARTIES TALK, USE HAND
SIGNAL, OR EMPLOY SOME OTHER MEANS OF COMMUNICATION
1) Develop an idea
2) Encode
3) Transmit
4) Receive
5) Decode
6) Accept
7) Use
8) Provide feedback
sender end
receiver end
TWO-WAY COMMUNICATION
Communication
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Step 1: Develop an idea
That sender wishes to transmit. Its key step, because unless
there is a worthwhile message, all other steps are useless.
Be sure brain is engaged before putting mouth in gear.
Step 2: Encode
Translate the idea into suitable words, charts, or other
symbols and organize in a fashion that is appropriate to the
type of transmission you choose
Communication
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Step 3: Transmit
Send by the method chosen: memo, phone call, email, video
conference, personal visit.
Keep communication channel free of barriers or interference
to ensure message reaches the receivers and hold their
attention.
Step 4: Receive
Receivers tune to receive. If its oral, they need to be good
listeners. If receiver does not function, the message is lost.
Communication
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5
Step 5: Decode
Translate the message back into meaningful idea just as it
was sent. If the sender has sent a square and receiver
decodes it as circle, then no understanding has happened.
UNDERSTANDING CAN HAPPEN ONLY IN RECEIVERS MIND.
A COMMUNICATOR MAY MAKE OTHERS LISTEN, BUT THERE IS NO
WAY TO MAKE THEM UNDERSTAND. THE RECEIVER ALONE
CHOOSES WHETHER TO UNDERSTAND OR NOT. MANY
PROJECT MANAGERS FORGET THIS WHEN GIVING
INSTRCUTIONS OR EXPLANATIONS TO THE STAKEHOLDERS
Communication
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Step 5: Decode
THEY THINK TELLING SOMEONE IS SUFFICIENT, BUT
COMMUNICATION CAN NOT PROCEED UNTIL THERE IS
UNDERSTANDING.
THIS IS CALLED, GETTING THROUGH A PERSON
STEP 6: Accept
Having received and decoded the message, the receiver have
The opportunity to accept or reject it. Project Managers, of
course, would like receivers to accept their communications
Communication
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STEP 6: Accept
In the manner intended so that activities can progress as
planned. Acceptance, however, is a matter of choice and
Degree, such that the receiver has considerable control over
Whether or not to embrace all the message or just its parts.
Some factors affecting acceptance decision:
a) perceptions of the messages accuracy
b) authority of the sender
c) behavioral implications for the receiver
Communication
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STEP 7: Use
The receiver may use the information, discard it , perform the
task as directed, store the information for future, or do
something else.
Step 8: Feedback
When the receiver acknowledges the message and responds
to the sender feedback has occurred. It completes the
communication loop.
COMMUNICATION BARRIERS
Communication
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1) Personal barriers:
- human emotions
- values
- poor listening habits
- differences in education, culture, sex,
socioeconomic status
2) Physical barriers:
- distance
- noise
- walls
- static that interferes with electronic
messages
Choice of media (depends on situation)
Communication
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Choice of media (depends on situation)
- in writing or orally
- informal memo or formal report
- face-to-face or email / video conference
Writing style:
- active or passive voice
- sentence structure
- word choice
Presentation techniques
Communication
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1
- body language ( non-verbal 55%)
- visual aids
Meeting management techniques:
- set a time limit and keep it
- schedule and agenda in advance
- stick to agenda
- chair and lead with set rules
- assign deliverables and time limits for resulting tasks
- bring right people together
A BREAK DOWN IN COMMUNICATIONS
Communication
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A BREAK DOWN IN COMMUNICATIONS
HAS
ADVERSE CONSEQUENCE ON THE PROJECT
THE PROJECT MANAGERS
MUST MASTER
THE ART OF COMMUNICATING
WITH
THE STAKEHOLDRES
Identify Stakeholders
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Plan Communications
Report Performance
Manage Stakeholders Expectations
Communication
Plan Communications
the process of
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the process of
Determining the project stakeholders
information needs and defining a communication
approach.
Identifying information needs of stakeholders
and deciding suitable means of meeting them
are key factors for project success!
Communication
Plan Communications
This process responds to the information and
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This process responds to the information and
communication needs of the stakeholders.
EXAMPLE:
- Who needs what information
- When they will need it
- How it will be given
- By whom
Communication
Plan Communications
Please remember:
Improper communication planning leads to
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Improper communication planning leads to
problems as delay in message delivery,
sending sensitive info to wrong audience, or
lack of communication to some required
stakeholders!
Effective communication means that the information
is provided in the right format, at the right time, and
with the right impact!
Communication
Plan Communications
Please remember:
On most projects, communication planning is done
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7
On most projects, communication planning is done
very early, such as during project management plan
development.
This allows appropriate resources, time and budget,
for communication activities.
The results of this process should be reviewed
throughout and revised as needed.
Communication
Plan Communications
Please remember:
Plan Communications process is tightly linked
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8
Plan Communications process is tightly linked
with Enterprise Environmental Factors.
WHY?
Because organizations structure will have a
major effect on the projects communication
requirements.
Plan Communications process overview
INPUTS
TOOLS &
TECHNIQUES
OUTPUTS
Communication
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9
Stakeholder
management strategy
Enterprise
Environmental
Factors
Assets
INPUTS
TECHNIQUES
Communication
requirements
Analysis
Communications
technology
Communication
Models
Communication
Methods
OUTPUTS
Communications
Management
Plan
Project Document
Updates
Plan Communications - INPUTS
Communication
1. Stakeholder register
provides information on the list of stakeholders,
their interests, and influence.
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their interests, and influence.
2. Stakeholder management strategy
provides important guidance on planning
communications.
3. Enterprise environmental factors
all enterprise environmental factors are used to
adapt communication to the project environment.
Plan Communications - INPUTS
Communication
All organizational process assets are used as inputs.
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Particularly important:
- Lessons Learned and Historical Information,
as they give insights on both the decisions
taken regarding communication issues and the
results of those decisions.
Plan Communications Tools & Techniques
1.Communications requirements analysis
CAUTION!
Communication
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CAUTION!
Please do not waste you resources on unnecessary
communications.
use them when communicating
contributes to success, OR
when lack of communication may
cause failure.
Communications Requirements analysis
For establishing project communications requirements, we
normally need to know:
1) Organization charts
Communication
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3
1) Organization charts
2) Project organization and the stakeholder
responsibility relationships
3) Departments disciplines, specialties
concerned with the project
4) People logistics and locations
5) Internal communication needs
6) External communication needs
7) Stakeholder information
Communication requirements analysis
Whom do we need to send Project Information?
Customer
Sponsor
Communication
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Sponsor
Senior management
Functional managers
Team members
Other project managers
Regulatory authorities
Media
Society
Outside specific interest groups, organizations
Any other stakeholder stakeholders
Communication requirements analysis
What do we need to communicate on our project?
1) Status
Communication
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2) Performance baselines
3) Achievements (major milestones, intermediate milestones,
etc.)
4) Problems
5) Changes to scope, schedule, cost, etc.
6) Adherence to standards and regulations
7) New risks uncovered
8) Team members performance
9) Project phase deliverables acceptance, projects product
acceptance, etc.
Communication
THROUGH
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Status reports
Progress reports
Trend report
Forecasting report
Variance report
Earned value analysis reports
Compliance to regulations, and so on
Communication channels
Communication
The project manager needs to consider the number of potential
communication channels to grasp the complexity of a projects
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communication channels to grasp the complexity of a projects
Communications:
2 PEOPLE, 1 CHANNEL
3 PEOPLE, 3 CHANNEL
4 PEOPLE, 6 CHANNEL
5 PEOPLE, 10 CHANNEL
( 20 PEOPLE, 190 CHANNEL! )
Communication channels = n (n-1) / 2
n = number of stakeholders
2. Communications technology
What factors decide your choice of communications
methods?
Communication
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methods?
General factors are:
Urgency for information
Availability of method
Expected project staffing
Length of the project
Communications technology factor
1. Urgency for information
We must examine if the stakeholders
Communication
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We must examine if the stakeholders
like customer, senior management, or
functional managers require reports
updates instantaneously, or normal
formal reporting will sufficient.
It depends on nature of project.
Communication
Communications technology factors
2. Availability of method
We examine if our existing communications
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technology is competent to meet project
communication requirements or we need to
change.
3. Expected project staffing
We analyze whether the project people have
the requisite abilities to use the
communications technology or they need
training.
Communication
Communications technology factors
4. Length of the project
The length of our project may see changes in
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The length of our project may see changes in
communications technology. If it is very long
project,
the advances in communications field may
offer better
or preferred mode of communication.
Therefore, we need to consider this aspect
also because it will cost time and money to
install new technology.
Communication
Communications technology
5. Project environment
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5. Project environment
Does the team operate on a face-to-face
basis or in a virtual environment.
Communication
3. Communication Models
A basic model is sender-receiver model. Components
are:
Encode:
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- Encode: Translate thoughts into a language that is
understood by others.
- Message and feedback-message: the output of
encoding both by sender and receiver.
- Noise: anything that interferes with the transmission
and understanding of the message(distance, unfamiliar
technology, lack of background information).
- Decode: to translate the message back into
meaningful thoughts or ideas.
Communication
Encode Decode
Message
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Encode
Decode Encode
Decode
Medium
Noise
Noise
Sender Receiver
Feedback-Message
Basic Communication Model
Please remember!
Inherent in this model is an action to
acknowledge a message. Acknowledgement
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acknowledge a message. Acknowledgement
means that the receiver signals receipt, but not
necessarily agreement with the message!
Another action is the response, which means
that the receiver has decoded, understands,
and is replying to the message.
Communication
3. Communication Models (duties)
The sender: Make the message clear and
complete so that the receiver can receive
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complete so that the receiver can receive
it correctly, and for confirming that it is
properly understood.
The Receiver: Make sure that the
message is received in its entirety,
understood correctly, and acknowledged.
A failure in communication negatively
impacts the project.
Communication
4. Communication Methods
include
Interactive Communication:
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- Interactive Communication: Between
two or more parties performing a
multidirectional exchange of
information. Most effective way to
ensure common understanding.
Meeting, Phone Calls, Video
Conferencing, etc.
Communication
Communication Methods
Include
- Push Communication: Sent to specific
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- Push Communication: Sent to specific
recipients who need to know the
information. This ensures that the
information is distributed but does not
certify that it has actually reached or
was understood by the intended
audience. Letter, Memos, Reports,
Emails, Faxes, Voice Mails, Press
Releases, etc.
Communication
include
Pull Communication
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- Pull Communication:- Used for very
large audiences that requires recipients
to access the content at their own
discretion. Intranet Sites, e-learning,
Knowledge Repositories.
Base on the requirements, project manager decides
what, how, and when communication methods are to
be used on the project.
Plan Communications - Outputs
Communications
management plan
Communication
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contains
1) Stakeholder communication requirements
2) Information to be communicated, format, content,
level of detail
3) Person responsible
4) Person/group who will receive
5) Methods
6) Frequency
Communications
management plan
Communication
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contains
7) Escalation process: defining timeframes and
management chain (names) for escalation of
issues that cant be resolved at lower levels
8) Method for updating and refining this plan as
project progresses
9) Glossary of common terminology
(very important)
Communication
Sample communications
management plan, contents
1. Communications item
Communications management
plan can have guidelines for
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1. Communications item
2. Purpose (reason for
distribution of info)
3. Frequency
4. Start date/end dates
(time frame for
distribution of info)
5. Format/medium
6. Responsibility
plan can have guidelines for
Project status meetings
Project team meetings
E-meetings
E-mail
This plan is a subsidiary plan of
overall project management plan.
Communication
It may include:-
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It may include:-
1) Project Schedule.
2) Stakeholder Register.
3) Stakeholder Management strategy.
Communication
Please remember!
Communication planning involves creation of additional
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Communication planning involves creation of additional
deliverables (reports, charts,etc).
Time and effort required for this must be reflected in WBS,
schedule, and budget.
Update them accordingly.
Processes concerned with conducting:
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Identify Risks
Perform Qualitative risk analysis
Perform Quantitative risk analysis
Plan Risk Responses
Monitor and Control Risks
Project Risks?
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An uncertain
Event or
Condition
if
occurs
- ve
+ ve
HAS
PROJECT
OBJECTIVES
SCOPE
QUALITY
COST
SCHEDULE
RISK
EFFECT
Project risk has its origin in the UNCERTAINTY
THE CONCEPT
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that is present in ALL projects!
risks could be positive (opportunities):
-an equipment is cheaper than planned, a work package
is accomplished earlier than expected, achieving quality
level on a work package takes lesser time than
expected, work can be done faster as we were able to
acquire a more productive resource!
THE CONCEPT
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that is present in ALL projects!
risks could be negative (threats)
risks could be known
risks could be unknown
What is cost contingency in following analysis of a product
modification project?
30% probability of delay in components receipt with a cost to the
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30% probability of delay in components receipt with a cost to the
project of Rs.9,000/-
20% probability that components will be Rs.10,000 cheaper than
expected.
25% probability that two parts will pose installation issue
costing extra Rs.3,500/-
30% probability that production will be simpler than expected,
saving Rs.2,500/-
5% probability of a design-defect causing Rs.5,000 rework
What is cost contingency in following analysis of a product
modification project?
30% X Rs.9,000 = Rs.2,700 outflow, add
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30% X Rs.9,000 = Rs.2,700 outflow, add
20% X Rs.10,000 = Rs.2,000 saving, subtract
25% X Rs.3,500 = Rs.875 outflow, add
30% X Rs.2,500 = Rs. 750 saving, subtract
5% X Rs.5,000 = Rs.250 outflow, add
OUTFLOW TOTAL Rs.3825, SAVING TOTAL Rs.2750
Contingency amount = 3825 2750 = Rs.1075
THE CONCEPT
Risk is a function of the UNIQUENESS of a
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Risk is a function of the UNIQUENESS of a
project and the EXPERIENCE of the project
team.
When activities are routine, you can anticipate
the range of potential outcomes.
THE CONCEPT
When project activities are non-routine (not
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When project activities are non-routine (not
performed before and your team is inexperienced),
the potential outcomes are more uncertain, making
it difficult for you to know what may go wrong and
how to avoid problems.
Even in routine projects, the outcomes may be
influenced by new factors, or those beyond your
control.
THE CONCEPT
Persons (by extension organizations) have
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3
Persons (by extension organizations) have
attitudes towards risks that affect both accuracy of
the perception of the risk and the way they
respond!!
A consistent approach to risk that meets
organizations requirements) must be developed
for EACH PROJECT! And communication about
risk must be made open and honest!
THE CONCEPT
Risk responses reflect an organizations
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4
Risk responses reflect an organizations
perceived balance between risk-taking and risk
avoidance!
TO BE SUCCESSFUL, we must manage risks
proactively and consistently throughout the project!
Now, the first process: Risk Management Planning
Why risk management planning?
CAREFUL AND EXPLICIT planning increases the
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5
CAREFUL AND EXPLICIT planning increases the
possibility of SUCCESS of five other risk
management processes!
decide how to approach and conduct risk management
activities on the project
provide sufficient time and resources for risk
management activities
establish an agreed-upon basis for evaluating risks.
When risk management planning?
Should be completed EARLY during project
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6
Should be completed EARLY during project
planning because it is CRUCIAL to performing
other risk management activities!
Plan Risk Management process overview
INPUTS
TOOLS &
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7
Enterprise
environmental
factors
Organizational
process assets
Project scope
statement
Schedule management
plan
Communications
management plan
INPUTS
TOOLS &
TECHNIQUES
Planning meetings
and analysis
OUTPUTS
Risk Management
Plan
Enterprise
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8
the attitudes toward risk and risk
tolerance of organizations and
people involved in the project will
influence the project
management plan. Risk attitudes
and tolerances can be found in
policy statements or in actions.
assets
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9
assets
predefined approaches to risk
management, such as:
1) Risk categories
2) Common definition of concepts and
terms
3) Standard templates
4) Roles and responsibilities
5) Authority levels for decision-making
- Provides a clear sense of the range of possibilities
related to the project and its deliverables.
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related to the project and its deliverables.
- Establishes the framework for how significant the risk
management effort may ultimately become!
- defines how risk budgets, contingencies, and
management reserves will be informed and availed!
- defines how schedule contingencies will be informed
and availed!
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and availed!
Communications management plan
- defines the interactions that will occur on the project
- Determines who will be available to share information
on various risks and responses at different locations
and times.
Planning meeting
The meetings are held by project
TOOLS &
TECHNIQUES
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2
The meetings are held by project
teams.
Must ensure participation of:
1. project manager
2. project team leaders
3. people responsible to manage risks and
implement plans
4. Key stakeholders
5. Others as necessary
TECHNIQUES
Planning meetings
and analysis
Planning meeting
What do we do in the meetings:
TOOLS &
TECHNIQUES
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3
What do we do in the meetings:
1. Define basic plans for risk management
activities
2. Develop risk cost elements and
schedule activities for including in
project budget and schedule
3. Assign risk responsibilities
4. Tailor to the project: templates for risk
categories and definitions of terms like
Levels of Risk, Probability by type of
Risk, Impact by type of objectives,
plus probability and impact matrix.
TECHNIQUES
Planning meetings
and analysis
OUTPUTS
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4
documents how risk identification,
qualitative and quantitative risk
analysis, risk response planning,
risk monitoring and controlling will
be structured and performed during
the project life cycle
(It does not tell you how to manage
individual risks. Management of individual
risks is contained in the risk response
plan).
OUTPUTS
Risk Management
Plan
INCLUDES
Methodology
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5
Methodology
Roles and responsibilities
Budgeting
Timing
Risk categories
Definitions of risk probability and
impact (Scoring and interpretation)
Probability and impact matrix set and
tailored to the project
Revised stakeholders tolerances as
they apply to the specific project
Reporting formats
Tracking ( how to record lessons
learned)
OUTPUTS
Risk Management
Plan
Methodology: defines approaches, tools, and data sources
that may be used in risk management on the project.
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that may be used in risk management on the project.
Roles and responsibilities: defines lead, support, and risk
management team membership for each type of activity in
the risk management plan.
Budgeting: assigns resources and estimate costs required
for risk management FOR INCLUSION IN THE RISK
MANAGEMENT PLAN!
Timing: defines when and how often the risk management
process will be performed throughout the project life cycle.
Establishes risk management activities TO BE INCLUDED IN
THE SCHEDULE!
Risk categories: Provides a structure that makes sure a
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Risk categories: Provides a structure that makes sure a
comprehensive process of SYSTEMATICALLY identifying
risk to a consistent level of detail. Contributes to the quality
and effectiveness of Risk Identification.
Example:
1) A RBS
2) Simple listing various aspects of the project
Risk categories may be revised during risk identification process!
GOOD PRACTICE: Review risk categories during risk management
planning process before their use in risk identification process
FOR TAILORING THEM TO SUIT YOUR CURRENT PROJECT!
Project
Organizational External Technical
Project
Management
Sample RBS
Categorizing risks
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Organizational External Technical
Management
Requirements
Technology
Complexity &
Interfaces
Performance &
Reliability
Quality
Subcontractors &
suppliers
Regulatory
Project
dependencies
Market
Customer
Weather
Resources
Funding
Prioritization
Estimating
Planning
Controlling
Communication
Definition impact scales for four on project objectives
Project
Objectives
Very low
.05
Low
.1
Moderate
.2
High
.4
Very high
.8
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COST
Insignificant
Schedule
Slippage
Insignificant
Cost increase
20% cost
Increase
10-20%
Cost
Increase
5-10%
Cost
Increase
5% cost
Increase
Quality
Deterioration
Negligible
Scope decrease
Negligible
QUALITY
SCOPE
SCHEDULE
5-10%
Schedule
Slippage
Affected only
Very demanding
Application
areas
Scope:
Minor areas
affected
20%
Schedule
Slippage
Quality
Reduction
Requires client
Approval
5%
Schedule
Slippage
Scope:
Major areas
affected
Quality
Reduction
Unacceptable
To client
Projects
Product
Effectively
Not usable
Projects
Product
Effectively
Useless
Scope
Reduction
Unacceptable
To client
Scope
Reduction
Unacceptable
To client
DETERMINES which risks might affect project
Identify
Risks
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DETERMINES which risks might affect project
objectives! And document their characteristics.
IS it one time job?
No, its an iterative job as new risks may appear
just as the project moves ahead in project life
cycle!
Risk identification is not easy job.
Identify
Risks
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I have seen many organizations
taking it casually on their projects,
only to pay heavily later (negative risk),
or miss opportunity (positive risk) that
they would have benefited from.
IDENTIFIES which risks might affect the project
DOCUMENTS their characteristics
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2
DOCUMENTS
INVOLVES:
a) Reviewing every input variable, activity, key material and
resource
b) Identifying threats and opportunities
c) Preparing checklists from others experience and ensuring
completeness
ADDRESSES:
1) Internal risks ( risks within control / influence of project team, such as staff
assignments, cost estimates, etc.)
2) External risks ( risks beyond control / influence of the project team, such
as market shifts or Government actions, etc.)
SHOULD not be done by the project team alone.
MUST INCLUDE :
your project team (for a sense of ownership/responsibility)
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your project team (for a sense of ownership/responsibility)
risk management team (can you tell why?)
subject matter experts (from other parts of your
organization)
other project managers (can you tell why?)
outside experts
customers
end users (very important)
other stakeholders
Risks can not be identified by just conducting the exercise once.
You have to iterate it to bring all risks to your grip.
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4
Risk identification iterations:
1. First iteration- by a part of your project team.
2. Second iteration- by entire project team and
primary stakeholders.
3. Final iteration- by people not involved in your
project (to remove the chances of any biased analysis).
Please remember!
Risks identification process normally leads
to qualitative risk analysis.
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to qualitative risk analysis.
May also lead to quantitative risk analysis if
done by an EXPERIENCED RISK
MANAGER.
Sometimes, simply conducting risk
identification may suggest its response that
is for further analysis and implementation in
the risk response planning.
Identify Risks process overview
INPUTS
TOOLS &
TECHNIQUES
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6
Activity duration
Estimates
Scope baseline
Project documents
Enterprise
assets
INPUTS
TECHNIQUES
Documentation
Reviews
Information
Gathering
Techniques
Checklist analysis
Assumptions
Analysis
Diagramming
Techniques
SWOT analysis
Expert judgment
OUTPUTS
RISK REGISTER
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Provides all these used here
1) Assignment of roles and
responsibilities for risk
management activities
2) Provision in budget and
schedule
3) Categories of risks
Categories of risks
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8
First category pertains to
Technical / Quality /
Performance Risks
Examples: dependence on
new, or complex, or unproven
technology, unrealistic
performance objectives, etc.
Categories of risks
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Second category relates to
Project Management Risks
Examples: inadequate application
of project management disciplines,
Poor quality of project plan,
Insufficient allocation of resources
and time, etc.
Categories of risks
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Third category pertains to
Organizational Risks
Examples: internal inconsistency
with scope, time, and cost
objectives, poor project prioritization,
funding problems,resource conflict
due to multiple projects in the
organization, etc.
Categories of risks
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Fourth category belongs to
External Risks
Examples: labor unrests, shifting owner
priorities, weather, legal/regulatory
changes, country-related risk.
FORCE MAJEURE RISKS : floods,
earthquakes, civil riots, cyclones, etc.) do
not call for risk management, but they need
disaster recovery actions.
risk identification needs
an understanding of:
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2
an understanding of:
1) The schedule,
2) Cost, and
3) Quality management plans
4) Outputs of other knowledge
area processes for review to
find possible risks across
entire project.
Outputs of other knowledge areas
most vital inputs to risk identification as they allow us understand
projects mission, scope, and objectives of the stakeholders
(including customer, sponsor, etc.)
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3
(including customer, sponsor, etc.)
These outputs:
Project charter
WBS
Product description
Schedule and cost estimates
Resource plan
Procurement plan
Assumptions and constraints lists
Used in inviting inputs for identifying risks from
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4
Used in inviting inputs for identifying risks from
key stakeholders (like customer).
Project documents
- assumptions log
- Work performance reports
- EV reports
- Network diagrams
- Baselines
- Other project information of use
factors
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5
Provide for help in risk
identification:
1) Commercial databases
2) Academic studies
3) Benchmarking
4) Other industry studies
Organization process assets
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6
Provide information from
previous project files,
including actual data and
lessons learned.
Risk identification is a serious job,
hence 5 tools and techniques come to
Your Help.
Identify Risks
TOOLS &
TECHNIQUES
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7
Your Help.
1.Documentation reviews
Is the structured review of
Project plans
Assumptions- project level
Assumptions- detail scope levels
Prior project files, and
Any other information
Documentation
Reviews
Information
Gathering
Techniques
Checklist analysis
Assumptions
Analysis
Diagramming
Techniques
SWOT analysis
Expert judgment
2. Information-gathering techniques
The aim: to obtain a comprehensive list of
risks that can be later addressed in risk
assessment processes.
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8
assessment processes.
TECHNIQUES:
Brainstorming (frequently used)
Delphi- to reach consensus of experts
anonymously
Interviewing: experienced project
participants and subject matter experts
Root cause identification (for effective
response)
SWOT analysis (projects strengths,
weaknesses, opportunities, threats are
analyzed to give a much wider view of the
risks under consideration).
2. Information-gathering techniques
Brainstorming (frequently used): project team performs with
multidisciplinary set of experts not on project team. Ideas on
project risk are gathered with the help of a facilitator.
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project risk are gathered with the help of a facilitator.
Categories of risk (like RBS) can be used as a framework. Risk
are identified and categorized and their definitions refined.
Delphi- to reach consensus of experts anonymously . A
facilitator sends a questionnaire to gather ideas about
important project risks, summarizes responses and sends
them again. Consensus is reached in few rounds, but without
experts knowing names of participants.
Advantage: helps reduce bias in data and keeps any one
person from having undue influence on the outcome!
3. Checklist analysis
Most handy and generally liked by
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people for they are quick and simple.
Checklists are made, based on:
Historical information, knowledge
derived from experience on prior
projects, and other sources.
ITEMIZE all categories of risks
relevant to your project.
3. Checklists
But there is a caution!
It is not possible to make an exhaustive
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It is not possible to make an exhaustive
checklist containing all risks on
your project.
There may be some important risks on
current project not listed in your
standard checklist!
IMPROVIZE YOUR CHECKLIST DURING
CLOSING PROCESS FOR USE ON NEXT
PROJECTS!
4. Assumptions analysis
Remember so many assumptions you have
made while initiating the project, defining
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2
made while initiating the project, defining
scope, planning resources, estimating time
and cost, etc.?
What if they turn out to be
inaccurate, inconsistent, and incomplete
later?
THEY BECOME RISKS!
Hence, you must analyze their validity to
assess how far they will stand to be
true.
5. Diagramming techniques
Help you immensely in identifying the risks.
You can use:
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3
You can use:
Cause-and-effect diagrams (Ishikawa /
fishbone diagrams)
System / Process Flow Charts
Influence Diagrams
examples
Cause-and-effect diagrams (Ishikawa / fishbone diagrams)
HARDWARE SOFTWARE FUNDS
Change
Hardware
shipment
Revenue from current
Project delayed
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4
Insufficient funds
to pay staff and
suppliers
Project
completion
delay
INSTALLATION STAFF
in user
requirements
Inadequate customer site
preparation
Hardware incompatible with
existing user systems
Hardware
Design incomputable
with software
requirements
shipment
delay
Hardware
supplier
goes bankrupt
Project delayed
Difficulty in teaching user
New Procedures
Software design does not
meet Initial Requirements
Insufficient technical skills
Staff shortage
Inability to hire / train
Additional staff
System/ process flow charts
depict interrelationship of elements and mechanism
of causation.
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of causation.
Develop manufacturing drgs
Develop engineering
Develop detail engineering
Project specification
Proceed manufacturing
Yes
No
Influence diagrams- show a problem with casual influences, time
ordering, and other linkages among variables and results.
S.1 Software
design does
I.1 Hardware
Incompatible
F.1 Hardware
Supplier goes
H.1 Hardware
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6
I.2 Inadequate
Customer site
Preparation
design does
not meet initial
requirements
S.2 Change in
User
Requirements
Incompatible
With existing
User systems
T.2 Inability to
Hire / train
Additional staff
T.1 Staff Shortage
I.3 Difficulty in
Teaching user
New Procedures
Supplier goes
bankrupt
F.3 Revenues
From Current
Project
Delayed
T.3 Insufficient technical skills
F.2 Insufficient
Funds to pay
Staff and
Suppliers
H.2 Hardware
Design
Incompatible
With Software
Requirements
Shipment delay
ARROWS SHOW INFLUENCE
Expert judgment
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Expert judgment
Experts with relevant experience help
us identify risks.
We have done great job!
Lets see the output we have
got!
OUTPUTS
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8
got!
Risks
all uncertain events or conditions
that might have positive or negative
effect on project objectives (In Case
They Happen).
But where do we write them?
OUTPUTS
RISK REGISTER
The risk register is first developed in the
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9
The risk register is first developed in the
Identify Risks process and updated
during rest of the risk management
processes!
Identified
risks
Risks
owners
Q & Q
analysis
Response
plans
Residual
risks
Secondary
risks
Sample Risk Register
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0
List of identified
Risks
List of potential
Responses
Root causes of
Risks
Updated risk
categories
A
B
C
D
E
List of identified risks: identified risks with root causes
under certain project assumptions. Examples:
1) A few large items with long lead times are on CP
2) IR problem at port may delay delivery and then delay
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2) IR problem at port may delay delivery and then delay
completion of construction phase
3) Plan for a size of ten but only six resources available
List of potential responses: identified during risk
identification.
Root causes of risk: fundamental conditions/events
causing risk.
Updated risk categories: new risk categories being
added to the list of risk categories. RBS may be enhanced.
Perform QUALITATIVE RISK
ANALYSIS
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ANALYSIS
Process of assessing for each risk
1) The probability of occurring and
2) The corresponding impact on project objectives
FOR PRORITIZING RISKS FOR FUTHER ACTION
Quantitative risk analysis or
Risk response planning
Perform QUALITATIVE RISK
ANALYSIS
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ANALYSIS
Process of also assesses other factors
1) Timeframe
2) Risk tolerance of schedule, cost, scope, and
quality
QUALITATIVE RISK
ANALYSIS
1) Organizations can IMPROVE POJECTS
PERFORMANCE effectively by focusing on HIGH-
Some principles-A
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PERFORMANCE effectively by focusing on HIGH-
PRIORITY RISKS.
2) A quick and cost-effective method of establishing
priorities for: RISK RESPONSE PLANNING.
Lays foundation for Quantitative Risk Analysis.
MUST be revisited during project life cycle to remain
current with the changes in the project risks.
QUALITATIVE RISK
ANALYSIS
4) Definitions of the levels of probability and impact, and
expert interviewing corrects the element of bias present
Some principles-B
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expert interviewing corrects the element of bias present
in the data utilized in this process.
5) Time criticality of risk actions highlight the significance
of A RISK
6) This process can lead to quantitative risk analysis or
directly into risk response planning.
What do we intend to achieve?
Prioritize risks according to their potential effect on project
objectives
Qualitative
Risk
Analysis
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6
objectives
Sort out high or moderate risks for more analysis, their
quantification, and management
Find trends in qualitative risk analysis results to see urgency
and significance for risk response and further analysis.
Determine overall risk ranking of the project.
Remove biases in the project plan
Perform Qualitative risk analysis process overview
INPUTS
TOOLS &
TECHNIQUES
OUTPUTS
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assets
Project scope
statement
Risk management
plan
Risk register
INPUTS
TECHNIQUES
Risk probability and
impact assessment
Probability / impact
risk rating matrix
Risk data quality
assessment
Risk categorization
Risk urgency
assessment
Expert judgment
OUTPUTS
Risk register
updates
assets
Qualitative
Risk
Analysis
INPUTS
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assets
provide data about risks on
the past projects and
lessons learned knowledge
base for use here
assets
Project scope
statement
Risk management
plan
Risk register
INPUTS
Project scope
statement
Common or recurring type
Qualitative
Risk
Analysis
INPUTS
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9
Common or recurring type
projects have well-understood
Risks. Projects using state-of-
the-art, first-of-its-kind
technology, or highly complex
ones have more certainty.
We can know this from scope
statement.
assets
Project scope
statement
Risk management
plan
Risk register
INPUTS
Provides for this process:
Qualitative
Risk
Analysis
INPUTS
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0
- roles & responsibilities
- Budgets and schedule activities
- Risk categories
- Definition of probability & impact
- P & I matrix
- Revised stakeholders
tolerances
assets
Project scope
statement
Risk management
plan
Risk register
INPUTS
Risk register
Qualitative
Risk
Analysis
INPUTS
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Risk register
Provides for this process:
The KEY input LIST OF
IDENTIFIED RISKS
assets
Project scope
statement
Risk management
plan
Risk register
INPUTS
Risk probability and impact
Describe probability and impact of a risk in
qualitative terms.
Qualitative
Risk
Analysis
TOOLS &
TECHNIQUES
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qualitative terms.
Risk probability
The likelihood that a risk will happen
Risk consequences
Its effect on project objectives, if it happens
Applied to specific risk events not entire
project
Helps identify risks that need to be managed
more aggressively.
TECHNIQUES
Risk probability
and impact
assessment
Probability / impact
risk rating matrix
Risk data quality
assessment
Risk categorization
Risk urgency
assessment
Expert judgment
Probability/impact rating
Qualitative
Risk
Analysis
TOOLS &
TECHNIQUES
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matrix
Now, we build a matrix by combining
probability and impact scales to know
the risk in qualitative terms, such as very
high, high, moderate, low, very low.
These scales improve quality of data and
enable repeatability of process.
TECHNIQUES
Risk probability
and impact
assessment
Probability /
impact risk rating
matrix
Risk data quality
assessment
Risk categorization
Risk urgency
assessment
Expert judgment
Probability/impact rating matrix
probability scale: 0.0 1.0
Qualitative
Risk
Analysis
TOOLS &
TECHNIQUES
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probability scale: 0.0 1.0
0.0 means no probability
1.0 means certainty
Ordinal scale defines relative probability
from very unlikely to almost certain, can
also be used.
Alternatively, specific probabilities could
be denoted general scale: .1/.3/.5/.7/.9.
TECHNIQUES
Risk probability
and impact
assessment
Probability /
impact risk rating
matrix
Risk data quality
assessment
Risk categorization
Risk urgency
assessment
Expert judgment
impact scale can be
Qualitative
Risk
Analysis
TOOLS &
TECHNIQUES
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5
impact scale can be
Cardinal: assigning linear values
.1/.3/.5/.7/.9, or non-linear values
.05/.1/.2/.4/.8 showing an organizations
desire to avoid high impact risks.
Ordinal: simply rank-ordering, such as
very low, low, moderate, high, very high.
TECHNIQUES
Risk probability
and impact
assessment
Probability /
impact risk rating
matrix
Risk data quality
assessment
Risk categorization
Risk urgency
assessment
Expert judgment
Qualitative
Risk
Analysis
each risk is rated on its probability
and impact of happening on a project
TOOLS &
TECHNIQUES
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and impact of happening on a project
objective (cost, schedule, scope, and
quality) if it does happen
an organizations thresholds for low,
moderate, or high are depicted in PI Matrix
and determine if the risk is scored low,
moderate, or high for that project objective
TECHNIQUES
Risk probability
and impact
assessment
Probability /
impact risk rating
matrix
Risk data quality
assessment
Risk categorization
Risk urgency
assessment
Expert judgment
Qualitative
Risk
Analysis
Probability and Impact matrix: green = low, yellow = moderate, red = high
Probability Threats Opportunities
Risk Score
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0.90
0.70
0.50
0.30
0.10
0.05
0.04
0.03
0.05
0.02
0.03
0.01 0.01 0.02
0.09 0.18
0.07 0.14
0.36
0.10
0.28 0.56
0.40
0.06
0.20
0.12
0.04
0.20 0.10 0.05 0.80 0.80 0.40 0.20 0.10 0.05
0.08
0.72
0.40
0.24
0.72
0.56
0.40
0.24
0.08 0.04 0.02 0.01 0.01
0.12 0.06 0.03 0.02
0.20 0.10 0.05 0.03
0.28 0.14 0.07 0.04
0.36 0.18 0.09 0.05
Risk Data quality assessment
We need accurate and unbiased
data for our analysis of risks to
Qualitative
Risk
Analysis
TOOLS &
TECHNIQUES
95
8
data for our analysis of risks to
be really useful. So we must test
them for their degree of
correctness by determining:
Extent of understanding of the
risk
Data availability on the risk
Quality of data
Reliability and integrity of data
TECHNIQUES
Risk probability
and impact
assessment
Probability /
impact risk rating
matrix
Risk data quality
assessment
Risk categorization
Risk urgency
assessment
Expert judgment
Risk categorization
1) by sources of risk: RBS
2) by area of the project
Qualitative
Risk
Analysis
TOOLS &
TECHNIQUES
95
9
2) by area of the project
affected: WBS
3) other useful category:
phase
To DETERMINE AREAS OF
PROJECT MOST EXPOSED TO
THE EFFECTS OF
UNCERTAINTY!
TECHNIQUES
Risk probability
and impact
assessment
Probability /
impact risk rating
matrix
Risk data quality
assessment
Risk
categorization
Risk urgency
assessment
Expert judgment
Group risks by common root causes
for effective risk responses!!!
Risk urgency assessment
Qualitative
Risk
Analysis
TOOLS &
TECHNIQUES
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Risk urgency assessment
tells which risks need to be
addressed in near term.
INDICATORS:
1) Time to effect a risk response
2) Symptoms and warning signals
3) Risk rating
TECHNIQUES
Risk probability
and impact
assessment
Probability /
impact risk rating
matrix
Risk data quality
assessment
Risk
categorization
Risk urgency
assessment
Expert judgment
Expert judgment
From experts having recent experience of having
Managed such projects.
Qualitative
Risk
Analysis
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Managed such projects.
Used to assess the probability and impact of each risk
To determine its location in the Matrix.
To remove bias this should be obtained by using risk
facilitation workshops or interviews.
We had initiated the risk register during risk
identification. We fill up the relevant
information from this process in it. Thus
Qualitative
Risk
Analysis
OUTPUTS
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information from this process in it. Thus
we update it, writing:
1) Relative ranking or priority of list of the
project risks
2) Risks grouped by categories
3) List of risks needing near-term response
4) List of risk for additional analysis and
response
5) Watch lists of low priority risks
6) Trends in qualitative risk analysis
OUTPUTS
Risk register
updates
Qualitative
Risk
Analysis
Identified
risks
Risks
owners
Q & Q
analysis
Response
plans
Residual
risks
Secondary
risks
Risk Register updates
96
3
List of identified
Risks
List of potential
Responses
Root causes of
Risks
Updated risk
categories
-Relative
Ranking or
priority of list
of the project
risks
-Risks grouped
by categories
-List of risks
needing near
term response
A
B
C
D
E
Qualitative
Risk
Analysis
Identified
risks
Risks
owners
Q & Q
analysis
Response
plans
Residual
risks
Secondary
risks
96
4
List of identified
Risks
List of potential
Responses
Root causes of
Risks
Updated risk
categories
-List of risk for
Additional
analysis and
response
-Watch lists of
low priority
risks
-Trends in
qualitative risk
analysis
A
B
C
D
E
Relative ranking or priority of list of the project risks
PI matrix classifies risks according to their individual
significance! This helps project manager focus on
high-importance items where responses can lead
Qualitative
Risk
Analysis
96
5
significance!
high-importance items where responses can lead
to better project outcomes!!
RISKS SHOULD BE LISTED BY PRIORITY
SEPARATELY FOR TIME, COST, SCOPE, AND
QUALITY. WHY?
Because organizations may value one objective over
another!
Please dont forget to write the basis for assessed
probability and impact for important risks.
Risks grouped by categories
Very important!
1) Reveals COMMON ROOT CAUSES of risk or
Qualitative
Risk
Analysis
96
6
1) Reveals COMMON ROOT CAUSES of risk or
project areas needing specific attention!
2) Improves effectiveness of risk response due to our
finding CONCENTRATIONS of risk.
List of risks requiring response in the near-term
We should place separately risks needing urgent
attention and risks needing later attention.
List of risks for additional analysis and response
Which risks need further analysis and more
Qualitative
Risk
Analysis
96
7
Which risks need further analysis and more
active management? High or moderate ones.
You go ahead with their Quantitative Risk
Analysis and pay more attention to planning
response for them and their subsequent
management.
Trends in qualitative risk analysis results
You get various trends in results of qualitative
Qualitative
Risk
Analysis
96
8
risk analysis as you repeat it.
These trends may help you decide:
whether risk response and further analysis is
more or less urgent, and important or not.
Perform
QUANTITATIVE RISK
96
9
QUANTITATIVE RISK
ANALYSIS
Process of
1) Assessing numerically the probability of each risk
prioritized by Qualitative Risk Analysis and its
consequence on project objectives,
2) Evaluating the extent of overall project risk
Perform QUANTITATIVE RISK
ANALYSIS

97
0
Hence, analyzes the prioritized risks showing
potential and substantial impact on projects
competing demands
Presents a quantitative approach to DECISION
MAKING amidst uncertainty
Deploys techniques:
- Monte Carlo Simulation
- Decision Tree Analysis
TO: 1) determine realistic and achievable
scope, schedule, cost targets in the
QUANTITATIVE RISK
ANALYSIS
97
1
scope, schedule, cost targets in the
backdrop of identified / quantified risks
2) evaluate possibility of achieving a
specific project objectives
TO: 3) quantify risk exposure for the project
and decide schedule and cost
contingency reserve
TO: 4) determine risks needing most attention
by quantifying their relative contribution
QUANTITATIVE RISK
ANALYSIS
97
2
by quantifying their relative contribution
to overall project risk
5) quantify the probable outcomes for the
project their probabilities
6) arrive at the best project management
amidst some uncertain outcomes
QUANTITATIVE RISK
ANALYSIS
97
3
ANALYSIS
Normally follows qualitative risk analysis, but
Experienced Managers may prefer it immediately
after risk identification
May not be needed in some cases for developing
effective risk response
QUANTITATIVE RISK
ANALYSIS
97
4
ANALYSIS
requirement of methods on a project is
decided by:
a) availability of time and budget
b) need for qualitative or quantitative
statements about risks and consequences
QUANTITATIVE RISK
ANALYSIS
97
5
ANALYSIS
MUST be repeated after:
a) risk response planning
b) part of risk monitoring and control
TO EVALUATE WHETHER OVERALL PROJECT RISK
HAS BEEN DECREASED TO SATISFACTION
QUANTITATIVE RISK
97
6
QUANTITATIVE RISK
ANALYSIS
TRENDS CAN HIGHLIGHT THE NECESSITY:
FOR MORE OR LESS RISK MANAGEMENT ACTION
Perform Quantitative risk analysis process overview
INPUTS
TOOLS &
TECHNIQUES
OUTPUTS
97
7
Organizational
process assets
Risk management
plan
Risks register
Schedule management
Plan
INPUTS
TECHNIQUES
Data gathering and
representation
techniques
Quantitative risk
analysis and
modeling
techniques
Expert judgment
OUTPUTS
Risk register
updates
assets
Quantitative
Risk
Analysis
97
8
assets
provide from industry or
proprietary sources:
1. Information on previous similar
projects
2. Studies of similar projects
3. Risk databases
Provides for this
Quantitative
Risk
Analysis
97
9
Provides for this
process:
- roles & responsibilities
- Budgets and schedule
activities
- Risk categories, RBS
- Revised stakeholders
tolerances,
Risk register
Provides key inputs:
Quantitative
Risk
Analysis
98
0
Provides key inputs:
- List of identified risks
- Priority list of project risks
- Risks grouped by
categories
- Schedule management plan,
sets format and establishes
Quantitative
Risk
Analysis
98
1
sets format and establishes
criteria for developing and
controlling project schedule.
- Cost management plan, sets
the format and establishes
criteria for planning,
structuring, estimating,
budgeting, and controlling
project costs.
Data gathering &
representation techniques
Interviewing
Quantitative
Risk
Analysis
TOOLS &
TECHNIQUES
98
2
1) Interviewing
2) Probability distributions
3) Expert judgment
Data gathering &
representation
techniques
Quantitative risk
analysis and
modeling
techniques
Expert judgment
Interviewing
Derive information from stakeholders and
subject matter experts by interviewing them.
Quantitative
Risk
Analysis
98
3
subject matter experts by interviewing them.
Information needed depends on
what type of probability distribution
we are going to use.
Quantifying risks?
What is your first step?
Answer:
Conduct risk interview with
Project stakeholders and
subject matter experts.
Probability distributions:
Triangular distribution/Mean and Standard
deviation for Normal and Log Distributions:
Dont forget to document
Quantitative
Risk
Analysis
98
4
deviation for Normal and Log Distributions:
For these, we gather information on the
optimistic (low), pessimistic (high), and
most likely scenarios, shown in slide
ahead.
Continuous probability distributions:
show both probability and consequences of
project component.
Common distribution types: uniform,
normal, triangular, beta, and log normal.
The RATIONALE OF RISK
RANGES!
Why?
Because it will help you make
Effective Risk Response
Strategies during risk
Response planning.
Example of risk interview
Breaks the myth of conventional
estimate (arrived at totaling most
Likely estimates).
Project Cost Estimates & Ranges
Quantitative
Risk
Analysis
Identifies three point estimates for each WBS
98
5
Likely estimates).
Actually, conventional estimate
Is relatively unlikely.
SEE THE EXAMPLE
Cost estimates and Ranges Risk
Interview. Here, cost is INR. The
conventional estimate summing
up to INR 45 is relatively unlikely.
WBS
element
Low Most
likely
High
Design
3 7 12
Build
17 22 37
Test
9 16 24
Total
Project
45
Quantitative
Risk
Analysis
EXAMPLE: COMMONLY USED PROBABILITY DISTRIBUTION
0.1 0.1
98
6
0.0
0.1 0.1
0.0
BETA DISTRIBUTION TRINGULAR DISTRIBUTION
P
R
O
B
A
B
I
L
I
T
Y
P
R
O
B
A
B
I
L
I
T
Y
IMPACT IMPACT
Quantitative
Risk
Analysis
EXAMPLE: INTERVIEW DEPLOYING BETA DISTRIBUTION
Mean = O + 4 M + P / 6 , Standard Deviation = P O / 6, Variance = P O / 6
2
98
7
ACTIVITY NAME
MOST
LIKELY
HIGH MEAN SIGMA VARIANCE LOW
6
M
15
20
X
21.8
2
3.2
1 1
4
A
P
6.3
O
B
C
4
2
16
11
41
15.7
43.8 3.9 15
10
23
35
10
Total estimate
Quantitative
Risk
Analysis
EXAMPLE: INTERVIEW DEPLOYING TRIANGULAR DISTRIBUTION
2
Mean = O + M + P / 3 , Variance = P O / 6 + (M O) (M P) / 18
98
8
ACTIVITY NAME
MOST
LIKELY
HIGH MEAN SIGMA VARIANCE LOW
6
M
15
20
X
23.7
2.5
4.2
1.2 1.5
6.2
A
P
6.7
O
B
C
4
2
16
11
41
16.3
42.4 5 25.1
17.4
23
35
10
Total estimate
Expert judgment
used to validate data and
Quantitative
Risk
Analysis
98
9
techniques.
experts could be internal or
external.
experts needed:
engineering or statistical
experts.
Quantitative risk analysis
and modeling techniques:
Quantitative
Risk
Analysis
99
0
and modeling techniques:
1) Sensitivity analysis
2) Expected monetary value
analysis
3) Decision tree analysis
4) Modeling and simulation
Sensitivity analysis
Want to know which risks have the most
potential impact on the project?
Quantitative
Risk
Analysis
99
1
potential impact on the project?
Sensitivity analysis does the same for you.
How? Well, it examines the extent to which the
uncertainty of each project element impacts
the objective you are examining
( caution: keep all other uncertain elements at
their baseline values).
Expected monetary value
analysis
Quantitative
Risk
Analysis
TOOLS &
TECHNIQUES
99
2
analysis
A statistical concept, an analysis under
uncertainty. Calculates average outcome
scenarios that may or may not happen.
EMV of opportunity shown as positive values
EMV of threats shown as negative values
EMV =
Value of each possible outcome x Probability,
and add them together
Data gathering &
representation
techniques
Quantitative risk
analysis and
modeling
techniques
Expert judgment
Expected monetary value
analysis
Quantitative
Risk
Analysis
99
3
analysis
commonly used in decision tree
analysis. But modeling and
simulation are more powerful and
can not be misused compared to it.
Decision tree analysis
Build or upgrade an exiting plant? Make or
outsource? Or any other such dilemmas face you!
Dont worry take the help of Decision Tree.
Quantitative
Risk
Analysis
TOOLS &
TECHNIQUES
99
4
Dont worry take the help of Decision Tree.
What is decision tree?
Its a tree-like diagram.
Begins with the decision to be evaluated, say
Build or upgrade.
Branches are logical path of available alternatives.
Each branch shows probabilities of risks and
associated costs or rewards.
Solving three shows you which decision provides
greatest expected value to you (after
quantifying all uncertain implications, costs,
rewards, and subsequent decisions).
Data gathering &
representation
techniques
Quantitative risk
analysis and
modeling
techniques
Expert judgment
Quantitative
Risk
Analysis
SAMPLE DECISION
TREE
Decision Definition
65%
Decision Node Chance Node Net Path Value
Decision to be
Made
Input: cost of decision
Output: decision made
(true, false)
Input: scenario probability
Output: expected monetary
Value (EMV)
Computed:
Payoffs costs
Along path
99
5
EMV of Chance Node
Rs. 49.0 M
EMV of the Decision
Rs. 49.0 M
EMV of Chance Node
Rs. 41.5 M
BUILD OR
UPGRADE
BUILD
NEW PLANT
UPGRADE
EXISTING PLANT
Strong Demand
Strong Demand
Weak Demand
Weak Demand
Rs. 80 M
- Rs. 30 M
Rs. 70 M
Rs. 10 M
- Rs. 120
Rs. 200
False
- Rs. 50
True
65%
35%
35%
65%
Rs. 90
Rs. 120
Rs. 60
Simulation
Translates uncertainties (specified
at a detail level) into potential
Quantitative
Risk
Analysis
TOOLS &
TECHNIQUES
99
6
at a detail level) into potential
impacts on project objectives
expressed at whole project level.
Most popular software: Monte Carlo
WBS is used for simulation for
cost risk analysis
PDM schedule is used for
schedule risk analysis
Data gathering &
representation
techniques
Quantitative risk
analysis and
modeling
techniques
Expert judgment
Quantitative
Risk
Analysis
100%
COST RISK SIMULATION
TOTAL PROJECT COST: CUMULATIVE CHART
Mean = 46.67
PROJECT IS ONLY
99
7
COST
30
0
65
50
12%
25%
50%
75%
41
Mean = 46.67
P
R
O
B
A
B
I
L
I
T
Y
PROJECT IS ONLY
12% LIKELY TO
MEET Rs. 41 LAC
ESTIMATE.
IF A Conservative
Organization
WANTS 75%
LIKELIHOOD OF
SUCCESS, A
BUDGET OF RS. 50
LAC IS NEEDED:
A CONTINGENCY
OF ALMOST 22% !
( in RUPEES LACS)
Quantitative
Risk
Analysis
OUTPUTS
We had initiated the risk register
during risk identification. We fill up
the relevant information from this
99
8
OUTPUTS
Risk register
updates
the relevant information from this
process in it. Thus we update it
further, writing:
1) Probabilistic analysis of the project
2) Probability of achieving cost and
time objectives
3) Prioritized List of quantified risks
Identified
risks
Risks
owners
Q & Q
analysis
Response
plans
Residual
risks
Secondary
risks
Quantitative
Risk
Analysis
99
9
List of identified
Risks
List of potential
Responses
Root causes of
Risks
Updated risk
categories
A
B
C
D
E
-Probabilistic
analysis of
the project
-Probability of
achieving cost
and time
objectives
-Prioritized List
of quantified
Risks
-Trends in QRA
PROBALISTIC ANALYSIS OF THE
PROJECT
Provides predictions of potential project
Quantitative
Risk
Analysis
OUTPUTS
10
00
Provides predictions of potential project
schedule and cost results detailing expected
completion dates or project duration and
costs- along with concerned confidence levels
PROBABILITY OF ACHIEVING THE COST
AND TIME OBJECTIVES
Using quantitative risk analysis, we can
estimate the probability of achieving the
project objectives- under the current plan and
given knowledge of the risks.
OUTPUTS
Risk register
updates
Prioritized list of quantified
Risks (with a measure of their impact)
Quantitative
Risk
Analysis
OUTPUTS
10
01
This list contains the risks that
indicate:
Major threat, or
Major opportunity
OUTPUTS
Risk register
updates
Trends in Quantitative Risk
Quantitative
Risk
Analysis
OUTPUTS
10
02
Trends in Quantitative Risk
Analysis
With the repetition of the quantitative
risk analysis, a trend in its results
emerges.
OUTPUTS
Risk register
updates
PLAN RISK RESPONSES
Developing options and determining
10
03
Developing options and determining
actions to ENHANCE Opportunities and
REDUCE threats to the project
objectives
Involves selecting BEST RESPONSE
from several options
PLAN RISK RESPONSES
Follows the processes of qualitative and
10
04
Follows the processes of qualitative and
quantitative risk analysis
Involves identification of risk response
owners to carry through the responsibility
of each agreed and funded risk
response
Deals with risks as per their priority
PLAN RISK RESPONSES
incorporates needed resources and
10
05
incorporates needed resources and
activities into:
a) schedule
b) budget
c) project management plan
PLAN RISK RESPONSES
MUST be appropriate to:
10
06
MUST be appropriate to:
a) the importance of risk
b) timely
c) cost-effective
d) agreed upon by ALL PARTIES
e) owned by a responsible person
KEY PONITS NEED EMPHASIS AGAIN!
Risk response planning:
Should correspond to severity of risk
PLAN
RISK RESPONSES
10
07
Should correspond to severity of risk
Should be cost effective
Should be realistic
Should be consented by all involved parties
Should be owned by a responsible person
MOST OFTEN RISK RESPONSE DOES NOT GIVE
US INTENDED RESULTS BECAUSE ONE OR
MORE OF THESE KEY PONITS ARE IGNORED !
Risk Management Plan
Risk register
INPUTS
TOOLS &
TECHNIQUES
Strategies for
negative risk
OUTPUTS
Risk Register
updates
Project management
PLAN RISK
RESPONSES
Process
Overview
10
08
negative risk
(threats)
Strategies for
positive risks
(opportunities)
Strategies for both
threats and
opportunities
Contingent
response strategy
Expert judgment
Project management
plan updates
Risks-related
contract decisions
Project document
updates
provides:
RISK
RESPONSE
PLANNING
Risk register
INPUTS
10
09
provides:
Roles & responsibilities
Risk threshold for L, M, H risks
Time and budget for project risk
management
Risk analysis definitions
Risk register
Was created in risk identification process,
RISK
RESPONSE
PLANNING
Risk register
INPUTS
10
10
updated with outputs of qualitative and
quantitative risk analysis. We use these
outputs here:
1) From risk identification
Identified Risks, their root causes
List of potential responses
Risk owners
Symptoms & warning signs
Risk register
We use these outputs here:
2) From qualitative risk analysis
RISK
RESPONSE
PLANNING
Risk register
INPUTS
10
11
2) From qualitative risk analysis
Priority list of risks
Risks needing near-term response
Risks for additional analysis and
response
Trends in qualitative risk analysis results
Root causes
Risks grouped by categories
Watchlist of low priority risks
Risk register
RISK
RESPONSE
PLANNING
Risk register
INPUTS
10
12
2) From quantitative risk analysis
Probabilistic analysis of the
project
Probability of achieving cost and
time objectives
Prioritized list of quantified risks
Trends in quantitative risk
analysis results
10
13
RISK OWNERS MUST PARTICIPATE
IN DEVELOPING
RISK RESPONSES
WHICH STRATEGIES WILL YOU CHOOSE?
ANSWER:
First, the MOST EFFECTIVE STRATEGY for
each risk
RISK
RESPONSE
PLANNING
10
14
First, the MOST EFFECTIVE STRATEGY for
each risk
Then, BACKUP STRATEGIES in case the best
one fails
After choosing Primary and Backup Strategies,
develop actions to implement them
A fallback plan if selected strategy not fully
effective, or if accepted risk occurs
Avoid
Eliminate threat by eliminating the cause!
You change project plan to eliminate the
threat, to isolate the project objective from
RISK
RESPONSE
PLANNING
TOOLS &
TECHNIQUES
Strategies for
negative risk
10
15
threat, to isolate the project objective from
the its impact, or to relax the objective that is
in jeopardy:
Examples
Extending schedule or reducing scope
Some risk that arise early can be avoided by:
Clarifying requirements
Obtaining information
Improving communication or
Acquiring expertise
negative risk
(threats)
Strategies for
positive risks
(opportunities)
Strategies for both
threats and
opportunities
Contingent
response strategy
- Expert judgment
Transfer
RISK
RESPONSE
PLANNING
TOOLS &
TECHNIQUES
Strategies for
negative risk
10
16
Can you shift the
risk?
Yes, you can.
negative risk
(threats)
Strategies for
positive risks
(opportunities)
Strategies for both
threats and
opportunities
Contingent
response strategy
- Expert judgment
Transfer
You can shift it to third party for its
ownership.
RISK
RESPONSE
PLANNING
TOOLS &
TECHNIQUES
Strategies for
negative risk
10
17
ownership.
But remember, it is just shifted, the
risk remains. Only its ownership and
management is off-loaded to the third
party for which due premium is paid
by you.
Risk transference is found most
effective in transferring financial
risk exposure.
negative risk
(threats)
Strategies for
positive risks
(opportunities)
Strategies for both
threats and
opportunities
Contingent
response strategy
- Expert judgment
EXAMPLES
Insurance
Transfer
RISK
RESPONSE
PLANNING
10
18
Insurance
performance bonds,
warranties,
guarantees
Contracts ( a fixed-price contract has least with the
buyer. A cost reimbursable one leaves more risk with
the buyer)
Mitigate
A very important response
RISK
RESPONSE
PLANNING
TOOLS &
TECHNIQUES
Strategies for
negative risk
10
19
A very important response
technique. We should try to
master it.
Here, we attempt to reduce the
probability and/or consequence
of a negative risk to acceptable
threshold.
negative risk
(threats)
Strategies for
positive risks
(opportunities)
Strategies for both
threats and
opportunities
Contingent
response strategy
- Expert judgment
Mitigate
RISK
RESPONSE
PLANNING
10
20
CARDINAL PRINCIPLE
Take early action to reduce probability of a risks
occurrence or its consequence on the project
objectives.
It is far better than making whole lot of repairs
after it has taken place.
A STICH IN TIME SAVES NINE!
Mitigation costs should be justified in view of the likely risk
probability and its impact.
Mitigate
RISK
RESPONSE
PLANNING
10
21
probability and its impact.
EXAMPLES
Implementing a new course of action
Adopting a less complex process
Conducting more seismic/engineering tests
Choosing more reliable seller
Adding resources/time to schedule
Developing prototypes
Designing redundancy into a system
Exploit
Chosen for risks with positive impacts
to ensure that the opportunity is
RISK
RESPONSE
PLANNING
TOOLS &
TECHNIQUES
Strategies for
negative risk
10
22
to ensure that the opportunity is
realized. It tries to eliminate the
uncertainty of an upside risk by
making the opportunity surely happen.
Examples:
Assigning more talented resources to
reduce time to completion
To provide better quality than
originally planned
negative risk
(threats)
Strategies for
positive risks
(opportunities)
Strategies for
both threats and
opportunities
Contingent
response strategy
- Expert judgment
Share
Sharing a positive risk involves
allocating ownership with a third
RISK
RESPONSE
PLANNING
TOOLS &
TECHNIQUES
Strategies for
negative risk
10
23
allocating ownership with a third
party who is best able to
capture the opportunity.
Examples:
Forming risk-sharing
partnerships, teams, special
purpose companies, JVs for the
sole purpose of managing
opportunities.
negative risk
(threats)
Strategies for
positive risks
(opportunities)
Strategies for
both threats and
opportunities
Contingent
response strategy
-Expert judgment
Enhance
This strategy modifies the size of an
opportunity by:
RISK
RESPONSE
PLANNING
TOOLS &
TECHNIQUES
Strategies for
negative risk
10
24
opportunity by:
1) Increasing probability and positive
impact
2) Identifying and enhancing key drivers of
these risks.
This means seeking to facilitate/strengthen
the cause of opportunity and reinforcing
its trigger conditions. Impact drivers are
also targeted.
negative risk
(threats)
Strategies for
positive risks
(opportunities)
Strategies for
both threats and
opportunities
Contingent
response strategy
-Expert judgment
Accept
This approach shows your
RISK
RESPONSE
PLANNING
TOOLS &
TECHNIQUES
Strategies for
negative risk
10
25
This approach shows your
project team has agreed:
not to change project plan in
order to deal with a risk, or
is unable to find out any
appropriate response
strategy
This approach may be
adopted both threats and
opportunities.
negative risk
(threats)
Strategies for
positive risks
(opportunities)
Strategies for
both threats and
opportunities
Contingent
response strategy
-Expert judgment
Accept
ACTIVE ACCEPTANCE
RISK
RESPONSE
PLANNING
TOOLS &
TECHNIQUES
Strategies for
negative risk
10
26
ACTIVE ACCEPTANCE
Your acceptance may be active and
you develop a contingency plan.
PASSIVE ACCEPTANCE
It may be passive. Do nothing-
leaving the project team to deal
with the risks as they happen.
negative risk
(threats)
Strategies for
positive risks
(opportunities)
Strategies for
both threats and
opportunities
Contingent
response strategy
-Expert judgment
Accept
Most common risk acceptance response is
FAQ
How much
RISK
RESPONSE
PLANNING
10
27
establishing a contingency plan/reserve
that incorporates amounts of:
Money
Time.
Resources
to address accepted identified risks
Or even sometimes potential
unknown threats and opportunities)
How much
contingency allowance
should be kept?
Answer: It is
determined by the
impacts. Compute it at
an acceptable level of
risk exposure.
Accept
CALCULATING COST RESERVE
IMPACT Expected
RISK
RESPONSE
PLANNING
10
28
Risk Probability
IMPACT
COST = - tive
Benefits = + tive
Expected
Monetary
Value (EMV)
A
B
C
D
20%
45%
10%
65%
- Rs. 4000
+ Rs. 3000
+ Rs. 2100
- Rs. 2500
- Rs. 800
- Rs. 210
+ Rs. 1350
- Rs. 1625
BENEFIT : Rs. + 1560, WE WILL SAVE
COST : Rs. - 2425, WE WILL SPEND
CONTINGENCY AMOUNT NEEDED : Rs. 865
CALCULATING COST RESERVE: Hands-on Exercise for Students
For a product modification project, we have following data. Please calculate Cost Reserve!
RISK
IMPACT
RISK
RESPONSE
PLANNING
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RISK
THREATS
OPPORTUNITIES
Probability
IMPACT
COST = - tive
Benefits = + tive
Delay in shipment of parts
30%
25%
20%
30%
- Rs. 9000
+ Rs. 3500
+ Rs.10000
+ Rs. 2500
Parts need extra installation work
Parts will be cheaper than expected
Design defect will cause rework
Production will be simpler than expected
5% - Rs. 5000
CALCULATING COST RESERVE: hands-on Exercise for Students
RISK
IMPACT Expected
RISK
RESPONSE
PLANNING
10
30
RISK
THREATS
OPPORTUNITIES
Probability
IMPACT
COST = - tive
Benefits = + tive
Expected
Monetary
Value (EMV)
Delay in shipment of parts
30%
25%
20%
30%
- Rs. 9000
+ Rs. 3500
+ Rs.10000
+ Rs. 2500
- Rs. 2700
+ Rs. 2000
- Rs. 875
+ Rs. 750
Parts need extra installation work
Parts will be cheaper than expected
Design defect will cause rework
Production will be simpler than expected
5% - Rs. 5000 - Rs. 250
BENEFIT : Rs. + 2750, WE WILL SAVE
COST : Rs. - 3825, WE WILL SPEND
CONTINGENCY AMOUNT NEEDED : Rs. 1075
Contingent response strategy
Designed for use only when CERTAIN
EVENTS occur. Why? Well, for some
RISK
RESPONSE
PLANNING
TOOLS &
TECHNIQUES
Strategies for
negative risk
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EVENTS occur. Why? Well, for some
risks, its better to make a response plan
that will be used only under certain
predefined conditions (when there will
be sufficient warning to implement the
plan).
Events that trigger contingency response:
1) Missing intermediate milestones
2) Gaining higher priority with a supplier
negative risk
(threats)
Strategies for
positive risks
(opportunities)
Strategies for
both threats and
opportunities
Contingent
response strategy
-Expert judgment
Expert judgment
From knowledgeable parties,
RISK
RESPONSE
PLANNING
TOOLS &
TECHNIQUES
Strategies for
negative risk
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inputs can be taken regarding
actions for specific and defined
risks.
negative risk
(threats)
Strategies for
positive risks
(opportunities)
Strategies for
both threats and
opportunities
Contingent
response strategy
-Expert judgment
CONTINGENCY AMOUNT
STRATEGIES FOR RISK RESPONSE
RISK
RESPONSE
PLANNING
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CONTINGENCY AMOUNT
Can be added to individual
activities or work packages, or to
the project as a whole
We fill the outputs in the risk register.
At this point, the risk register contains:
RISK
RESPONSE
PLANNING
OUTPUTS
Risk Register
updates
Project management
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Identified risks with descriptions,
concerned area of project like WBS
element, their causes, and how they
may impact project objectives
outputs from qualitative and
quantitative risk analysis
Risk owners and their assigned
responsibilities
Budget and times for responses
Project management
plan updates
Risks-related
contract decisions
- Project document updates
We fill the outputs in the risk register. At
this point, the risk register contains:
Expected level of residual risks
RISK
RESPONSE
PLANNING
OUTPUTS
Risk Register
updates
Project management
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Expected level of residual risks
Consented responses for each risk and
specific actions for chosen response
strategy
Symptoms and warning signals of risks
occurrence
Budget and schedule activities for
implementing chosen responses
Contingency reserves of time and cost
designed to provide for stakeholders risk
tolerances
Contingency plans and trigger that call for
their execution
Project management
plan updates
Risks-related
contract decisions
-Project document updates
We fill the outputs in the risk
register. At this point, the risk
register contains:
RISK
RESPONSE
PLANNING
OUTPUTS
Risk Register
updates
Project management
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register contains:
Fallback plans if primary response
inadequate
Residual risks expected to remain after
planned responses have been taken and
those that have been deliberately accepted
Secondary risks that arise as a direct
outcome of of implementing a risk response
Contingency reserves calculated on the
basis of quantitative risk analysis and
organizations risk thresholds
Project management
plan updates
Risks-related
contract decisions
- Project document updates
Project management plan
updates
Updated as response activities are added
RISK
RESPONSE
PLANNING
OUTPUTS
Risk Register
updates
Project
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Updated as response activities are added
to it after review and approval through
Integrated Change Control. Integrated
change control is applied in the Direct
and Manage Project Execution process.
Why? To make sure that agreed-upon
actions are implemented and monitored
as part of the progressing project.
Risk response strategies are fed back into
concerned processes in other knowledge
areas (WBS, budget, schedule)
Project
management
plan updates
Risks-related
contract decisons
Risk-related contractual
agreements
RISK
RESPONSE
PLANNING
OUTPUTS
Risk Register
updates
Project
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Contractual agreements are
prepared to specify each partys
responsibility for specific risks, in
case they occur.
Example:
Agreements for insurance,
services, and other items as found
suitable.
Project
management
plan updates
Risks-related
contract decisions
Project document
updates
RISK
RESPONSE
PLANNING
OUTPUTS
Risk Register
updates
Project
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updates
Example:
1) Assumptions log updates
2) Technical documentation
updates
Project
management
plan updates
Risks-related
contract decisions
Project Planning continues!
Project
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Project
Procurement Management
Project Procurement Management
THE CONCEPT
Consists of processes to purchase or acquire the
products, services, or results needed from outside
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products, services, or results needed from outside
the project team to perform the work.
Procurement has two perspectives:
1) The buyer organization
2) The seller organization
THE CONCEPT
The processes
1) Plan procurements: make or buy decision, preparing
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1) Plan procurements: make or buy decision, preparing
procurement documents, and identifying potential
sellers.
2) Conduct procurements: obtaining proposals, selecting
sellers, and awarding contract.
3) Administer procurements: checking performance and
managing changes.
4) Contract procurements: completing each procurement.
These 4 processes together make the contract life cycle!
THE CONCEPT
Contract
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CONTRACTING PROCESS
LIFE CYCLE OF THE CONTRACT
Plan
Procurements
Administer
Procurements
Close
Procurements
Conduct
Procurements
1) Plan procurements: Make or buy decision
CONTRACT LIFE CYCLE BRIEF
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1) Plan procurements: Make or buy decision
made, contract type selected, scope of work
drafted. Procurement management plan
developed. Procurement documents
created. Potential buyers identified.
2) Conduct procurements: Proposals requested
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2) Conduct procurements: Proposals requested
and received. Sellers selected and Contract
awarded.
5) Administer procurements: Managing
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5) Administer procurements: Managing
procurement relationships, monitoring contract
performance, and making changes and corrections
as required.
6) Close procurements: Seller provides contracted
product, buyer accepts and makes final payment,
lessons learned documented, contract file archived.
This is completion of procurement for each item.
Contract: Ushers a legal relationship between Buyer
CONTRACT
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and seller.
It obligates the seller to provide the contracted item,
and it obligates the buyer to pay for it.
Hence, contract is a legal document and must be
prepared by the buyer with due care. It is subject to
remedy in the courts.
Contract comes into force only after it is accepted
and signed by both the parties.
CONTRACT
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and seller. It includes:
SOW of the contracted item (CSOW)
Terms and conditions.
Sellers proposal
Sellers marketing literature, and
Any other documentation buyer is relying upon to
establish what the seller is to perform or provide.
Contract: project management team is responsible to
CONTRACT
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Contract: project management team is responsible to
tailor the contract to the specific needs of the
project.
It is subjected to extensive reviewing process before
approval to ensure THAT THE CONTRACT
LANGUAGE DESCRIBES THE CONTRACTED
PRODUCTS, SERVICES, OR RESULTS THAT
SATISFY THE IDENTIFIED PROJECT NEED!
Contract: project management team should take help
CONTRACT
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Contract: project management team should take help
of specialists in contracting, purchasing and law!
Most organizations have policies and procedures
defining who can sign and administer such
agreements on behalf of the the organization!
By actively managing the contract life cycle and
carefully wording the contract, we can avoid or
mitigate some identifiable project risks. Contracting
is one way of transferring the risk to seller.
Contract: is Also called
CONTRACT
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Contract: is Also called
An agreement
Subcontract, or
Purchase order
Contract: A seller can Also be called
CONTRACT
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Contract: A seller can Also be called
Contractor, vendor, service provider, supplier, or
subcontractor,
A buyer can Also be called
Client, acquiring organization, customer, acquiring
organization, service requester, purchaser,
government agency, prime contractor, contractor.
Contract: A complex project may involve multiple
CONTRACT
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Contract: A complex project may involve multiple
contracts or subcontracts!
Each contract life cycle may complete during any
phase of the project life cycle.
Subcontract, or
Purchase order
Contract: Except for the purchase of materials, goods,
or common products, A seller will manage the work
CONTRACT
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or common products, A seller will manage the work
as a project:
Buyer becomes customer, and then key stakeholder for
the seller
Sellers project management team will follow all
knowledge areas and project management process
groups to mange it as a project
Inputs will be major deliverables, key milestones, cost
objectives. Plus contract terms and conditions.
Constraints may be buyer approval of staffing decisions,
etc.
CONTRACT
SELLER in contract life cycle
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First Then And thereafter
a bidder the selected source contracted vendor
Fundamental concept of project procurement
management is that The buyer of the items is within
the project team and seller is external to project
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the project team and seller is external to project
team:
1) This relationship true if the performing organization
is the seller a project to the customer.
2) This relationship is also true when the performing
organization is the buyer from other vendors,
suppliers of products, services, results, or
subproject components on a project.
Essence is that a formal Contractual Relationship
exits between buyer and seller!
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exits between buyer and seller!
If you are procuring items from your others units of the
project teams organizations also, you may not enter
into a non-contractual formal agreement but most of
our discussion on project procurement management
is relevant for such agreements also.
Example: Tata Motors procured steel sheets from its
Tata Steel for its Indices Project.
Plan Purchases and Acquisitions
Determines
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58
WHICH project needs WHICH project needs
Can be accomplished by the Can be best met by
project team during Project acquiring products/
Execution services outside the
project organization
identified DURING PROJECT DEFINITION EFFORT
Plan Procurements
Considers
Plan Procurements
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Considers
1. whether to procure? (make or buy!)
2. how to procure? (procurement methods)
3. what to procure? (description of products)
4. how much to procure? (quantity)
5. when to procure? (procurement schedule)
6. potential subcontractors (prospective sellers)
(Consideration of potential sellers gives some degree of
influence/ control to the buyer over contracting decisions)
PLEASE REMEMBER!
While planning purchases and acquisitions, we must
not forget to consider issues like:
Plan Procurements
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not forget to consider issues like:
Who is responsible for obtaining or holding any applicable
permits and professional licenses required by LEGISLATION,
REGULATION, OR YOUR ORGANIZATIONS PLOICY!
Project Schedule greatly influences this process.
Plus your decisions in procurement management plan may also
influence project schedule and therefore must be considered
when developing project schedule and activity resource
estimating, and make-or-buy decisions!
PLEASE REMEMBER!
While planning purchases and acquisitions, we must
not forget to review:
Plan Procurements
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not forget to review:
the type of contract you plan to use in relation to
MITIGATING RISKS AND TRANSFERRING THEM
TO THE SELLER!
Enterprise
INPUTS
TOOLS &
TECHNIQUES
Make-or-buy
Analysis
OUTPUTS
Procurement
Management Plan
Procurement Statements
Plan Procurements: PROCESS OVERVIEW
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assets
Scope baseline
Requirements
documentation
Teaming agreements
Risk register
Risk-related contract
decisions
Activity Resource
requirements
Project schedule
Cost baseline
Analysis
Expert Judgment
Contract Types
(Selection)
Procurement Statements
of work
Make-or-buy decisions
Procurement documents
Source selection criteria
(evaluation criteria)
Change requests
EEFs
provide information on
1) The marketplace
Plan
Procurements
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1) The marketplace
2) What product, services are
available in the market and under
what terms and conditions
3) Procurement resources: If you
dont have a purchasing group,
then the project team have to
supply both resources and
expertise for project procurement
activities.
INPUTS
OPAs
provide formal/informal procurement
policies, procedures, guidelines, and
management systems for use in making
Plan
Procurements
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management systems for use in making
Procurement Plan and deciding Contract
Type. They act as constraints and limit:
1) The ability to make specific make-or-buy
decisions.
2) May require specific types or sizes of
sellers.
3) Some organizations have multi-tier
system of selected and pre-qualified
sellers to decrease the number of direct
sellers and establish an extended supply
chain.
INPUTS
a) Project Scope Statement
provides important information on
1) project needs and strategies
Plan Procurements
INPUTS
Scope baseline
a) Scope statement
b) WBS
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1) project needs and strategies
that we must consider when during
what to procure.
Also provides 2) list of deliverables,
acceptance criteria for the project
and its products, plus any technical
issues relating to the product of the
project.
All these factors must be
considered and flowed down
within our contract to sellers!
b) WBS
c) WBS dictionary
Project Scope Statement
describes project 3) boundaries,
requirements, constraints and
Scope baseline
a) Scope statement
b) WBS
Plan Procurements
INPUTS
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requirements, constraints and
assumptions concerning project
scope. EXAMPLES:
A. Constraints: availability of funds (most
common on projects)
B. Assumptions: availability of multiple
sellers or sole seller
C. Requirements with legal and contractual
obligations: performance, intellectual
property rights, insurance, licenses,
permits, equal employment opportunities,
health, safety, and security.
b) WBS
c) WBS dictionary
b) WBS
describes relationship among all
the components of the project and
project deliverables. We will
Scope baseline
a) Scope statement
b) WBS
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project deliverables. We will
outsource some portion of it, or we
may outsource entire project also.
c) WBS dictionary provides
detailed SOWs identifying
deliverables plus description of
work within each WBS component
needed to be done to produce that
deliverable.
b) WBS
c) WBS dictionary
Plan procurements
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Difference between Product Description and Statement of Work:
Product Description describes the ultimate end product of the
project. Statement of work describes the portion of that
product to be provided by seller to the buyers project
The difference no longer exists if the performing organization
decides to procure the entire product.
Requirements documentation provides
Important information about project requirements
which need to be considered when we plan
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which need to be considered when we plan
procurements
Requirements with legal and contractual implications:
health, safety, security, performance, IPR, insurance,
environmental, licenses, permits, equal-employment-
opportunity, etc.
Teaming Agreements (legal contractual agreement
between two or more entities to form joint venture or
partnership. Whenever new business opportunity
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partnership. Whenever new business opportunity
ends, this agreement also ends)
Whenever a Teaming Agreement is in place on a
project, the roles of buyers and sellers are pre-
determined.
Scope of work, competition requirements and other
critical issues are also predefined.
We consider following too while planning procurements:
- risk register
- Risk related contract decisions
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- Risk related contract decisions
- Activity resource requirements
- Project schedule
- Activity cost estimates
- Cost performance baseline
TOOLS &
Make-or-buy analysis
General management technique
Plan procurements
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TOOLS &
TECHNIQUES
Make-or-buy
Analysis
Expert Judgment
Contract Type
Selection
General management technique
used to decide whether a particular
product/service can be produced
(COST EFFECTIVELY) by the project
team or need to be purchased
Budget constraints are factored in
Considers both direct and indirect
costs
example
TOOLS &
TECHNIQUES
example
Plan procurements
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TECHNIQUES
Make-or-buy
Analysis
Expert Judgment
Contract Type
Selection
example
Buy-side of analysis includes actual
1) Direct out-of-pocket costs to
procure the product, and
2) Indirect costs of managing the
purchasing process.
TOOLS &
TECHNIQUES
Reflects
Plan procurements
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TECHNIQUES
Make-or-buy
Analysis
Expert Judgment
Contract Type
Selection
Reflects
1) Perspective of the performing
organization, and
2) Immediate project needs
3) Long range strategy
examples
TOOLS &
TECHNIQUES
example
Buying an item (say material
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75
TECHNIQUES
Make-or-buy
Analysis
Expert Judgment
Contract Type
Selection
Buying an item (say material
handling equipments or computers)
or leasing it may or may be cost
effective on the current project.
But, if performing organization
Requires it on regular basis and
buys the item, then the part of the
purchase cost apportioned to the
project may be less than the leasing
cost. (Margin Analysis helps allocate
such costs)
TOOLS &
TECHNIQUES
Example of long range strategy
Certain items needed for performing the
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76
TECHNIQUES
Make-or-buy
Analysis
Expert Judgment
Contract Type
Selection
Certain items needed for performing the
project may not be with the organization
But having regard to future requirements
(for such items) and the business plans,
The organization may decide to purchase
them despite project requirements and
Constraints
If this happens, then the only marginal cost is
charged to the project and difference is
treated as investment for future
Expert judgement
What expert judgment is needed?
1) Expert technical judgment to access
TOOLS &
TECHNIQUES
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77
1) Expert technical judgment to access
inputs and outputs from this process.
2) Expert purchasing judgment to develop
or modify evaluation criteria.
3) Expert legal judgment to make terms and
conditions for non-standard procurement
items.
4) Such technical, business and legal
judgment can also be applied to other
aspects of procurement management
processes.
TECHNIQUES
Make-or-buy
Analysis
Expert
Judgment
Contract Type
Selection
Contract type selection
TOOLS &
TECHNIQUES
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Different contract types suit different
types of purchases
Degree of risk assessed by both buyer
and seller decides the choice of a
Contract Type
TECHNIQUES
Make-or-buy
Analysis
Expert
Judgment
Contract Type
Selection
Common contract types
Common Contract Types:
TOOLS &
TECHNIQUES
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Common Contract Types:
1) fixed-price or lump-sum
2) Cost-reimbursable
a) cost-plus-fee: CPF, or cost-plus-
percentage of cost: CPPC
b) cost-plus-fixed-fee: CPFF
c) cost-plus-incentive-fee: CPIF
3) time and material ( T & M )
TECHNIQUES
Make-or-buy
Analysis
Expert
Judgment
Contract Type
Selection
TOOLS &
TECHNIQUES
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fixed-price or lump-sum
1) Fixed total price for a well-defined
product
2) Buyer at least cost risk as seller bears
the risk of cost escalation
3) Seller most concerned about scope
4) Suitable if buyer can fully describe
scope
5) Also incentives for fixed-price
contracts
TECHNIQUES
Make-or-buy
Analysis
Expert
Judgment
Contract Type
Selection
Simplest form: Purchase Order
TOOLS &
TECHNIQUES
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a) fixed-price
Example Contract INR 5,500,00
Fixed-price-incentive-fee (FPIF)
Example
Contract INR 5,500,000
Incentive INR 50,000 for every month
for finishing contracted work early
TECHNIQUES
Make-or-buy
Analysis
Expert
Judgment
Contract Type
Selection
TOOLS &
TECHNIQUES
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Fixed-price-economic-price-adjustment
(FPEPA)
Example
Contract INR 5,500,000
Buyer agreed for price increase in
in year 2 based on All India Price
Index for year 1 for material price
escalation, or based on increase in
Statutory Variable Dearness
Allowance for labor
TECHNIQUES
Make-or-buy
Analysis
Expert
Judgment
Contract Type
Selection
Cost-reimbursable
TOOLS &
TECHNIQUES
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Cost-reimbursable
1) Buyer reimburses sellers actual costs
plus a fee as sellers profit.
2) Buyer at highest cost risk as complete
scope is not clear and total contracted
costs are unknown.
3) Such contracts are awarded when
buyers can only describe what they
need and not what to do.
TECHNIQUES
Make-or-buy
Analysis
Expert
Judgment
Contract Type
Selection
Cost-reimbursable
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Cost-reimbursable
Here, costs are categorized as direct costs or
indirect costs. Indirect cost: a percentage of
direct cost
Direct costs
incurred solely for the benefit of
the project.
Example: salaries of full-time
project staff
Indirect costs (overhead/general/
administrative cost): allocated to
the project as cost of doing
Business.
Example: 1)salary of management
staff indirectly involved in the
Project, 2) office electricity bill
TOOLS &
TECHNIQUES
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Cost-reimbursable
include incentive clauses for:
IF THE SELLER MEETS OR EXCEEDS
SELECTED OBJECTIVES (schedule/cost),
THE SELLER GETS
AN INCENTIVE / BONUS
PAYMENT
TECHNIQUES
Make-or-buy
Analysis
Expert
Judgment
Contract Type
Selection
TOOLS &
TECHNIQUES
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Cost-reimbursable
a) Cost-plus-fee (CPF) or Cost-plus-percentage
of cost (CPPC)
1) Buyer reimburses all allowable costs plus
an agreed-upon percentage of costs as fee
2) Here, seller is not motivated to control
costs. WHY? Fee varies with the actual
cost. The seller will get fee on every cost
without limit.
TECHNIQUES
Make-or-buy
Analysis
Expert
Judgment
Contract Type
Selection
Example: contract = cost plus 5% of costs
as fee
TOOLS &
TECHNIQUES
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Cost-reimbursable
b) Cost-plus-fixed-fee: CPFF (most common)
1) Buyer reimburses all allowable costs and
paid a fee ( profit) fixed at a specific rupee
amount (as a percentage of estimated
project cost)
2) Fee is fixed: does not vary with cost
3) Advantage: keeps sellers costs in line.
TECHNIQUES
Make-or-buy
Analysis
Expert
Judgment
Contract Type
Selection
WHY?
TOOLS &
TECHNIQUES
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Cost-reimbursable
b) Cost-plus-fixed-fee: CPFF (most common)
because a cost overrun will not get the
seller any extra fee (profit)
Example:
Contract = cost plus INR 500,000 (fixed)
TECHNIQUES
Make-or-buy
Analysis
Expert
Judgment
Contract Type
Selection
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Cost-reimbursable
1) Buyer reimburses all allowable costs + an
agreed-upon fee + an incentive bonus,
based on achieving certain performance
objective levels
EXAMPLE
Contract = Costs + fee, say INR 500,000 + INR 50,000 (for
every month the project is earlier than agreed)
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90
Cost-reimbursable
2) In some cases, if the final costs are less
than expected costs, then both buyer and
seller benefit from the savings, base on
mutually agreed sharing formula
HANDS-ON EXERCISE
HANDS-ON EXERCISE : COST REIMBURSABLE CASE 2
DATA
1) Estimate cost INR 630,000, fee INR 75,000
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1) Estimate cost INR 630,000, fee INR 75,000
2) If seller performs better, savings sharing:
80% buyer, 20% seller
3) Actual costs INR 600,00
4) Find out final fee and final price
HANDS-ON EXERCISE : COST REIMBURSABLE CASE 2
SOLUTION
Step 1
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Step 1
Fee = INR 630,000 INR 600,000
= INR 30,000 x 20%
= INR 6,000
Final fee = INR 75,000 target fee + INR 6,000
= INR 77,000
Step 2
Final price = INR 600,000 + 77,000
= INR 677,000
Plan purchases &
Acquisitions
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93
time and material ( T & M )
1) Hybrid of cost-reimbursable and fixed-
price
- Cost-reimbursable portion: open ended
- Fixed-price portion : unit rates are
fixed
2) Full value and exact quantity of items to be
delivered are not defined by buyer, but unit
rate of the category of item is are set by
mutual agreement
3) Buyer has medium amount of cost risk
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time and material ( T & M )
Example
Contract = INR 1000 per hour or material at cost
or INR 300 per linear foot of tiles
Moot points
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95
Moot points
Contract type is also determined by:
the requirements buyer imposes on seller
Example: standard/custom product version, cost data submittal,
performance reporting
2) Other planning considerations
Example: degree of risk, market competition
Contract pricing
when high future potential of purchase item is promised by the buyer,
the seller may charge less, but buyer should be honest in promising
such a potential (otherwise it may lead to legal remedy by the seller).
Procurement management
plan
OUTPUTS
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96
Describes
how the procurement processes shall
be managed from developing procurement
documents through contract closure
Includes
1) Contract types for use
2) Who will make independent estimates
and if they are required as evaluation
criteria
OUTPUTS
Procurement
Management Plan
Procurement
Statements of work
Procurement
documents
Source Selection
Criteria
Change requests
plan includes
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plan includes
3) If the performing organization has a
procurement department, then what
actions project management team is
allowed to take on its own
4) Standard procurement documents
5) Information on managing multiple
contractors
6) Coordinating procurement with project
scheduling, performance reporting, etc.
plan includes
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7) Procurement related constraints and
assumptions
8) Lead times management and
coordination with schedule
development
9) Managing make-or-buy decisions,
linking well with resource planning and
schedule development
plan includes
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99
10) Determining scheduled dates for
contract deliverables and coordinating
them with schedule development and
control processes
11) Determining performance bonds /
insurance to mitigate risks
12) Establishing direction for seller to help
develop and maintain contract WBS
13) Establishing format for contract SOW
14) Listing pre-qualified sellers
plan includes
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15) Determining procurement metrics for
managing contracts and evaluating
sellers
Depending on the needs of the project,
this plan may be:
- formal or informal
- highly detailed or broadly
framed
IS A SUBBIDIARY PART OF PROJECT PLAN
Procurement Statement of work
Each contract SOW defines:
the portion of the project scope to be acquired through the
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the portion of the project scope to be acquired through the
respective contract
Developed from:
1) Scope baseline
2) Activity resource requirements
Please remember it!
Procurement Statement of work
Describes the procurement item
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Describes the procurement item
in sufficient detail TO ALLOW THE PROSPECTIVE
SELLERS TO DETERMINE IF THEY ARE
CAPABLE OF PROVIDING THE ITEM!
Please remember it!
Procurement Statement of
work
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03
work
SUFFICIENT DETAIL depends on:
1) NATURE OF THE ITEM
2) NEEDS OF THE BUYER, OR
3) EXPECTED CONTRACT
FORM
Contract SOW must be CLEAR,
COMPLETE AND CONCISE!
INFORMATION IN CSOW:
a) Specifications
b) Desired quantity
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04
b) Desired quantity
c) Quality levels
d) Performance data
e) Period of performance
f) Work location
g) Collateral services (performance
reporting/ post-project operational
support)
h) Other requirements
INFORMATION IN CSOW:
there are specific content and
format requirements for a contract
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05
format requirements for a contract
SOW in some application areas
CSOW as it moves the
Procurement process:
is revised and refined until
incorporated into a signed
contract. WHY?
Because a prospective seller
may suggest:
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06
A MORE EFFICIENT
APPROACH OR LESS
COSTLY PRODUCT (THAN
THE ONE ORIGINALLY
SPECIFIED)
Are obvious output.
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07
May also include: Decisions to buy
insurance policies, performance
bond contracts! WHY? Answer: To
address some of the identified risks.
May be simple (short justification)
May be complex (iterative as subsequent
procurement activities may require a
different approach)
used to request proposals from
prospective sellers
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prospective sellers
Common names for different types of
procurement documents:
invitation for bid (IFB), request for bid
(RFB)
request for proposal (RFP)
request for quotation (RFQ)
invitation for negotiation,
tender notice
contactor initial response
Term quotation, bid, tender is often used:
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Term quotation, bid, tender is often used:
When buyer selects seller based on price
Example: purchasing standard or
commercial items
Term proposal is often used:
When other considerations, such as
sellers technical skills or technical
approach, experience, background, etc.,
are considered important
Terms may be used interchangeably also.
Hence, please avoid making unwarranted
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Hence, please avoid making unwarranted
assumptions
STRUCTURE OF PROCUREMENT
DOCUMENTS MUST:
1) Facilitate an accurate and
complete response from each
prospective seller
2) Facilitate easy evaluation of the
bids
include:
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include:
1) A description of the desired form of
response
2) Contract SOW
3) Required contractual provisions
(copy of model contract, non-
disclosure provisions)
4) Evaluation criteria
COMPLEXITY AND LEVEL OF DETAIL:
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COMPLEXITY AND LEVEL OF DETAIL:
Correspond the value of purchase and
the risk involved
PROCUREMENT DOCUMENTS SHOULD
BE RIGOROUS ENOUGH:
to ensure complete, consistent, and
comparable responses
FLEXIBLE ENOUGH:
to permit consideration of suggestions
from the sellers regarding better ways to
satisfy requirements
Evaluation criteria
Developed and used to rate or
score Proposals
Source
selection
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13
score Proposals
1) FOR THE ITEMS READILY
AVAILABLE FROM MANY
SELLERS
Evaluation Criteria limited to
purchase price. Purchase Price
means landed cost
( cost of the item and ancillary
expenses, such as freight)
selection
criteria
Source
selection
Evaluation criteria
Developed and used to rate or score
Proposals
2) FOR A MORE COMPLEX PRODUCT
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selection
criteria
2) FOR A MORE COMPLEX PRODUCT
OR SERVICE
1) Understanding of need
2) Overall life cycle cost
3) Technical capability
4) Management approach
5) Financial capacity
6) Production capacity and interest
7) Business size and type
8) References
9) Intellectual property rights
10) Proprietary rights
Change Requests
This process may lead to
requested changes to the project
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requested changes to the project
management plan and its
subsidiary plans.
These changes are processed for
approval through Integrated
Change Control process.
Deals with
Develop project charter (discussed)
Develop project management plan (We will discuss now)
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Develop project management plan (We will discuss now)
Direct and manage project execution
Monitor and control project work
Perform Integrated change control
Close project or phase
PROCESS of documenting the actions necessary
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PROCESS of documenting the actions necessary
to define, prepare, integrate, and coordinate all
subsidiary plans.
The project management plan defines how the
project is executed, monitored and controlled,
and closed. It integrates and consolidates all
baselines and subsidiary plans.
PROCESS RESULTS IN
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PROCESS RESULTS IN
A Project Management Plan
The contents of this plan depend on
complexity of the project and the application
area
The project management plan is developed
Through a series of integrated processes
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Through a series of integrated processes
until project closure.
This process results in a project management
plan that is progressively elaborated by
updates and controlled and approved through
the Perform Integrated Change Control
process.
Develop Project
Management Plan
PROJECT PLAN
PM PLAN UPDATES
OUTPUTS OF ALL OTHER
PM PROCESSES + PLUS
THEIR MANAGEMENT
PLANS, Organizational policies
Constraints, Assumptions
Project Management Overview
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PROJECT PLAN
EXECUTION
INTEGRATED
CHANGE CONTROL
Deliverables
Requested changes
Implemented change requests
Implemented corrective action
Implemented preventive action
Implemented defect repair
Work performance report
Approved corrective action
Approved preventive action
Rejected change requests
Recommended corrective action
Recommended preventive action
Recommended defect repair
Forecasts
Project closeout
Contract closure
Administrative
closure
Constraints, Assumptions
Monitor & Control
Project Work
Close project
deliverables
Project Management Plan Components
Scope management plan
All baselines
- scope baseline
Subsidiary plans
components
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Human resource plan
Communication management plan
Change management plan
Configuration management plan
- scope baseline
- schedule baseline
- cost baseline
Life cycle selected
Results of tailoring
How work will be executed
Key management reviews
(for addressing open issues
and pending issues).
Project Documents: List 1
Activity attributes
Activity list
Milestone list
Performance reports
Project funding
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Activity list
Assumptions log
Basis of estimates
Change log
Charter
Contracts
Duration estimates
Forecasts
Issue log
Project funding
requirements
Proposals
Project organization
structure
QC measurements
Quality checklists
Quality metrics
Project Documents: List 2
Requirements traceability
matrix
RBS
Stakeholder requirements
Statement of work
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RBS
Resource calendars
Risk register
Roles and responsibilities
Sellers list
Source selection criteria
Stakeholder management
strategy
Statement of work
Teaming agreements
Team performance
assessments
Work performance
information
Work performance
measurements
Develop Project Management plan process overview
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Project charter
outputs from planning
processes
Enterprise
Organizational
process assets
INPUTS
TOOLS &
TECHNIQUES
OUTPUTS
Expert Judgment
Project Management
Plan
Develop Project Management Plan process: INPUTS
1) Project charter
2) Outputs from planning processes
3) Enterprise environmental factors considered
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3) Enterprise environmental factors considered
here:
a) Government or industry standards
b) PMIS
c) Organization structure and culture
d) Infrastructure (existing facilities and capital
equipments)
e) Personnel administration
4) Organizational Process Assets considered
here:
a) Standardized guidelines, work instructions,
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a) Standardized guidelines, work instructions,
proposal evaluation criteria, and performance
measurement criteria,
b) Project management plan templates- elements of
the project management plan that may be updated:
Guidelines for tailoring the organizations set of
standard processes to satisfy needs of the project,
Project closure guidelines (product validation and
acceptance criteria)
here:
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c) Change control procedures
d) Project files from past projects:
Scope, cost, schedule and performance
measurement baselines, project calendars,
network diagrams, risk registers, planned
response actions, and defined risk impact.
here:
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Historical information and lessons learned,
Configuration management knowledgebase
(versions and baselines of all official company
standards, policies, procedures, and any other project
document).
Develop Project Management Plan process: TOOLS
EXPERT JUDGMENT Utilized to
tailor the process to meet project needs,
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tailor the process to meet project needs,
Develop technical and management
details to include in project management
plan,
Determine resources and skills needed to
perform the project work,
Develop Project Management Plan process: TOOLS
EXPERT JUDGMENT Utilized to
Define the level of configuration
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Define the level of configuration
management to apply on the project, and
Determine which project documents will
be subject to formal change control
process.
WBS
EARNED VALUE CPM
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PMIS
EARNED VALUE CPM
HISTOGRAM
Develop Project Management Plan process: OUTPUTS
Project Management plan
We have already discussed about Project
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We have already discussed about Project
Management Plan. Please get it approved and
then we are ready for Execution!
Did we hear it right?
Hold kick-off meeting!
Develop Project Management Plan process: OUTPUTS
Kick-off meeting
After project plan is developed and
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After project plan is developed and
approved and before we begin
implementation, we hold kick-off meeting!
WHY?
SO THAT EVERYONE IS ON THE SAME
PAGE!!
EXECUTING
Executing Process Group
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EXECUTING
PROCESS
Group
Executing processes
EXECUTING PROCESS GROUP
THE CONCEPT
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THE CONCEPT
Consists of processes:
Deployed to accomplish the work described in
the project management plan in order to
achieve the projects requirements.
Executing processes
THE CONCEPT
Involves:
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Involves:
1) Coordinating PEOPLE and RESOURCES
2) Integrating and performing the activities according to
the project management plan
3) Addressing the defined scope
4) Implementing approved changes
Executing processes
THE CONCEPT
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Requires some replanning: Due to normal execution
variances
Examples of general variances:
a) Activity duration variances
b) Resource productivity variances
c) Resource availability variances
d) Unanticipated risks (variance from what risks you had
expected)
Executing processes
THE CONCEPT
These variances:
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These variances: May or may not impact the project
management plan. But you must analyze them! WHY?
Because the results of your analysis may:
1) Trigger a change request
2) If the change request is approved, it would modify the
project plan and MAY NEED REBASELINING!!
Executing processes
Direct & Manage Project Execution
THE CONCEPT
Utilizes : Majority of budget, as all the resources
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Utilizes : Majority of budget, as all the resources
you had planned are put to maximum
use here.
processes
1) Direct and Manage Project Execution
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1) Direct and Manage Project Execution
2) Acquire project team
3) Develop project team
4) Manage project team
5) Perform quality assurance
6) Distribute information
7) Manage stakeholders expectations
8) Conduct procurements
THE CONCEPT
Is Primary Process for Carrying out the project
management plan;
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management plan;
Involves directing and managing various
technical and organizational interfaces
existing in the project to execute the work;
Deliverables are produced as outputs (from
the processes as defined in the project
management plan).
What do we do?
1. Perform activities to accomplish project
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1. Perform activities to accomplish project
requirements,
2. Create project deliverables,
3. Staff, train, and manage the team members,
4. Obtain, manage, and use resources (all
types),
5. Implement the planned standards and
methods,
What do we do?
6. Establish and manage project communication
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6. Establish and manage project communication
channels,
7. Generate project data (status, forecasting),
8. Issue change requests and adapt approved
changes into the projects scope, plans, and
environment,
What do we do?
9. Manage risks and implement risk response
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9. Manage risks and implement risk response
activities,
10. Manage sellers and suppliers,
11. Collect and document lessons learned,
and implemented approved process
improvement activities.
Project manager, along with project
management team, directs the performance
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management team, directs the performance
of planned activities, and manages various
Technical and Organizational Interfaces that
exist within the project!
Direct and manage project execution is
directly affected by the project application
area!
What do we get?
Deliverables
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Deliverables
Work performance information about
completion status of deliverables, and
what has been accomplished is fed into
the performance reporting process.
Work performance info used as input to
monitoring and Controlling Process Group.
Here we also implement:
Approved corrective actions to bring
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Approved corrective actions to bring
anticipated project performance as per project
plan.
Approved preventive actions to reduce
probability of negative consequences.
Approved defect repair with recommendation
to either repair or replace defective
component.
Direct and Manage Project Execution process overview
INPUTS
TOOLS &
OUTPUTS
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Project Management
Plan
Approved change
requests:
- Approved Corrective
actions
- Approved Preventive
actions
- Approved change
requests (other types)
- Approved defect
repair
EEFs
OPAs
INPUTS
TOOLS &
TECHNIQUES
Expert judgment
Project
management
information
system
OUTPUTS
Deliverables
Work performance
information
Change requests
Project management
plan update
Project document
updates
process inputs
1. Project Management Plan
We have discussed in detail.
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2. Approved Change Requests
As a part of the Perform Integrated Change
Control process, a change control status
update shows that some changes are
approved and some are not.
process inputs
Approved Change Requests continued
Approved change requests are scheduled for
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implementation by the project team.
Approved change requests are the documented,
authorized changes to expand or reduce scope.
Approved change requests can also modify,
project management plan, procedures,
costs/budget, or revise schedule.
process inputs
Approved Change Requests continued
Approved change requests may also require
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implementation of Corrective Action, or
Preventive Action, or Defect Repair or
Replacement of Defective Component.
3. Enterprise environmental factors
Factors that can influence are:
Organizational, company or customer culture
and structure,
process inputs
Enterprise environmental factors
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Infrastructure (existing facilities and capital
equipments),
Personnel administration (hiring and firing
guidelines, employee performance review,
and training records),
Stakeholder risk tolerances
process inputs
Enterprise environmental factors
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Project Management Information System
(PMIS) AN AUTOMATED TOOL:
1) a scheduling software,
2) A configuration management system,
3) An information collection and distribution
system,
4) Web interfaces to other online automated
systems).
process inputs
OPAs that can influence are:
Standard guidelines and work instructions,
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Standard guidelines and work instructions,
Communication requirements (defining
allowed media, record retention, and security
requirements),
Issue and defect management procedures
(defining issue and defect controls, issue and defect
identification and resolution, and action item
tracking).
process inputs
Organizational process assets continued
OPAs that can influence are:
Process measurement databases used to
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Process measurement databases used to
collect and make available measurement
data on processes and products,
Project files from previous projects,
Issue and defect databases (having historical
issue and defect status, control info,
resolution, and action item results).
process tools & techniques
EXPERT JUDGMENT
Used to assess inputs
needed for this process.
TOOLS &
TECHNIQUES
Expert judgment
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needed for this process.
Such judgment and expertise
is applied to all technical and
management details during
this process.
Expert judgment
Project
management
information
system
EXPERT JUDGMENT
This expertise is provided by the
project manager and the project
TOOLS &
TECHNIQUES
Expert judgment
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project manager and the project
management team.
Additional expertise is available
from many sources:
- other units within organization,
- consultants, stakeholders
- professional/technical associations
Expert judgment
Project
management
information
system
Project Management
Information System
TOOLS &
TECHNIQUES
Expert judgment
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Used here. Details already
discussed.
Expert judgment
Project
management
information
system
process outputs
Deliverables
An deliverable is any unique
OUTPUTS
Deliverables
Work performance
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An deliverable is any unique
and verifiable product, result
or capability to perform a
service that must be
produced to complete a
process, phase, or project.
Work performance
information
Change requests
Project management
plan updates
Project document
updates
Direct and Manage Project Execution process
OUTPUTS
Information on work results:
To what extent Which
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To what extent
the quality
standards are
being met
What costs have
been incurred or
committed
Which
deliverables
have been
completed
and which
have not
IS COLLECTED HERE AND FED INTO THE PERFORMANCE
REPORTING PROCESS FOR NECESSARY ANALYSIS AND
EVALUATION!
Work Results (DELIVERABLES)
Are mostly tangible but intangible too:
Example
OUTPUTS
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Example
Tangible Deliverables
1) Buildings
2) Structures
3) Roads
Intangible
Deliverables
1) Training
2) Mentoring
3) Facilitation
OUTPUTS
Changes Requests
When issues are found while work is being
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When issues are found while work is being
performed, change requests are issued.
Change requests may to expand modify project
policies or procedures, project cost or budget,
project schedule or project quality.
OUTPUTS
Changes Requests
Other change requests cover required
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Other change requests cover required
preventive or corrective actions to forestall
negative impact later in the project.
OUTPUTS
Changes Requests
Please note: requests for a change can be direct
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Please note: requests for a change can be direct
or indirect, externally or internally initiated,
and can be optional or legally/contractually
mandated. They can include:
a) Corrective action (to bring expected future
performance in line with the project
management plan).
OUTPUTS
Changes Requests
They can include:
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They can include:
b) Preventive action (to reduce the probability
of negative consequences associated with
project risks).
c) Defect repair
d) Updates (changes to formally controlled
documentation, plans to reflect modified or
additional ideas or content.
OUTPUTS
Project Management Plan Updates
Include updates to:
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Include updates to:
1. Requirements management plan
2. Schedule management plan
3. Cost management plan
4. Quality management plan
5. Human resource plan
6. Procurement management plan, and
7. Project baselines
OUTPUTS
Include updates to:
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Include updates to:
1. Requirements documentation
2. Project logs (issue, assumptions, etc.)
3. Risk register, and
4. Stakeholder register
Executing Process Group
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EXECUTION
PROCESSES
The process of confirming Human Resource
Acquire Project Team
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The process of confirming Human Resource
availability and obtaining the team necessary to
complete project assignments.
Please remember: The project management team
may or may not have control over team members!
WHY? Because of collective bargaining
agreements, use of subcontractor personnel,
matrix organization, internal or external reporting
relationships, or other various reasons!!
Please remember following:
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1) The project manager or project management
team should effectively negotiate with others
who are in a position to project human
resources for the project.
2) Failure to acquire necessary human resources
may affect project schedules, budgets,
customer satisfaction, quality, and risks! It
could decrease probability of success and finally lead to
project cancellation.
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3) If human resources are not available due to
constraints, economic factors, or previous
assignments to other projects, the project
manager or project team may be required to
assign alternative resources with lower
competencies, provided there is no violation of
legal, regulatory, mandatory, or other specific
criteria.
All these factor must be considered and planned
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All these factor must be considered and planned
for during planning stages.
BE SURE!
The project manager or project management team
should reflect Impact of any unavailability of
required human resources in the project schedule,
project budget, project risks, project quality, training
plans, and other project management plans!!!
Acquire project team process overview
INPUTS
TOOLS &
TECHNIQUES
OUTPUTS
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Project Management
Plan
Enterprise
environmental
factors
Organizational
process assets
INPUTS
TECHNIQUES
Preassignment
Negotiations
Acquisition
Virtual teams
OUTPUTS
Project Staff
Assignments
Resource
Calendars
Project management
plan updates
Acquire Project Team process INPUTS
Project Management Plan provides
Human Resource Plan
That has information on How Project Human
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That has information on How Project Human
Resource should be identified, staffed, managed,
controlled, and eventually released. Defines:
a) Roles and responsibilities describing positions,
skills, and competencies that the project demands.
b) Project organization charts indicating the number
and hierarchy of people needed for the project.
c) Staffing management plan (time periods of usage,
and other necessary information).
Following factors influence this process:
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1) Existing information for human resources (Availability
Competency levels, Experience, Interest in working on
the project, their Cost Rates).
2) Personnel administration policies (that affect
outsourcing).
3) Organizational structure
4) Location or multiple locations
Following factors influence this process:
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Organization standard policies, processes,
procedures.
Tools & Techniques
Preassignment
Happens when project team is
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Happens when project team is
promised as part of competitive
bid, or project depends on some
special expertise, or staff
assignments are defined in the
charter. Please remember it!
Negotiation
Happens when project team is drawn
from within:
Acquire
Project Team
Tools &
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from within:
You negotiate with Functional
Managers for competent staff, to be
provided in needed timeframes,
and stay with until their job is
completed.
You negotiate with other project
management teams for sharing
scarce or specialized resources.
Tools &
Techniques
Negotiation
Here, your ability to influence and
politics of the organizations involved
Acquire
Project Team
Tools &
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politics of the organizations involved
play important part.
A Functional Manager will provide
his/her exceptional performers only
where he/she sees benefits and
visibility of competing projects
demanding those resources!
Tools &
Techniques
Acquisition
Recruit or hire or subcontract work if
Acquire
Project Team
Tools &
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Recruit or hire or subcontract work if
the performing organization lacks
the in-house staff required to
complete the project.
Tools &
Techniques
Virtual teams
Creates new possibilities when
Acquire
Project Team
Tools &
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Creates new possibilities when
acquiring project team members!
These teams are groups of people,
though not meeting face to face, but
share common goal and fulfill their
roles. Video-conferencing, emails,
etc. have really helped success of
such teams.
Tools &
Techniques
Virtual teams
New possibilities
Acquire
Project Team
Tools &
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New possibilities
Teams of people from same company
located in different geographical areas
Add special expertise through remote
Include employees working from home
offices or people with mobility handicaps
Teams of people working in different
shifts/hours
Take up projects ignored due to travel
expenses
Tools &
Techniques
Virtual teams
New possibilities caution!
Acquire
Project Team
Tools &
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New possibilities caution!
You need to spend extra time to
1) SET CLEAR EXPECTATIONS
2) DEVELOP PROTOCOLS FOR
CONFRONTING CONFLICTS
3) INVOLVE PEOPLE IN DECISION-
MAKING
4) SHARE CREDIT IN SUCCESS
So, communication planning becomes very
important here!! Please remember!!!
Tools &
Techniques
OUTPUTS
Project is staffed when
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Project is staffed when
necessary people are assigned
to work on it!
Includes documentation:
1) Project team directory
2) Memos to team members
3) Their names written in
organization charts, schedules
OUPUTS
Resource Calendars
Documents time periods each team
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Documents time periods each team
member will work on the project.
Please remember: You can develop
a reliable, final schedule only after
considering each persons
schedule conflicts, including his
commitments to other projects and
his vacations, etc.
OUTPUTS
updates may include
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Human Resource Plan.
D
E
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T
E
A
M
E
V
E
L
O
P
M
E
N
T
Project Human Resource Development
Develop Project Team
Concept
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Consists of
1) Improving the competencies, team interaction,
and overall team environment to enhance
project performance.
2) Project managers should acquire skills to
identify, build, maintain, motivate, lead, and
inspire project teams to achieve high
performance and meet project objectives.
Concept
Teamwork Critical Success Factor for project
success
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success
1) Developing effective project team is one of the
primary responsibility of the project manager!
2) Project managers should create an environment
that facilitates teamwork.
3) Project Manager
Concept
Teamwork Critical Success Factor for project
success
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success
3) Project Manager should continually motivate
their team by:
1) Providing challenges and opportunities,
2) Timely feedback,
3) Support as needed, and
4) Recognizing and rewarding good performance.
Concept
HIGH Team Performance can be by
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1) Using open and effective communication,
2) Developing trust among team members,
3) Managing conflict in a constructive manner, and
4) Encouraging collaborative problem-solving and
decision making.
The project manager should request support and influence
stakeholders to get resources for developing effective project
teams!
Challenges
Global environment, cultural diversity
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Team members often have diverse industry
experience, multiple languages, and sometimes
operate in the tteam languageor norm that is a
different language than their native one.
What should be done to tackle this?
Challenges
The project management team should
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a) Capitalize on cultural differences,
b) Focus developing and sustaining the project
team throughout the project life cycle, and
c) Promote working interdependently in a climate of
mutual trust.
Advantage?
Advantage
Developing the project team
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Improves the people skills and technical
competencies, and overall team environment and
project performance!
It requires clear, timely, effective and efficient
communication between team members
throughout the project lifecycle!
Objectives?
Objectives of developing a project team
1) Improve knowledge and skills to increase ability
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1) Improve knowledge and skills to increase ability
to complete project deliverables, while lowering
costs, reducing schedules, and improving
quality.
2) Improve feelings of trust and agreement among
team members to raise morale, lower conflict,
and increase teamwork, and
Objectives of developing a project team
3) Create a dynamic and cohesive team culture
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96
3) Create a dynamic and cohesive team culture
to improve both individual and team productivity,
team spirit, and cooperation, and allow cross-
training and mentoring to share knowledge and
expertise.
Team development basics
TEAM DEVELOPMENT
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97
INDIVIDUAL DEVELPOMENT
(behavioral and technical)
is the foundation essential
to develop the team
TEAM DEVELOPMENT
is
critical to the projects ability
to meet its objectives
FORMING STORMING NORMING,
PERFORMING
MOURNING
STAGE 1 STAGE 2 STAGE 3 STAGE 4
Stage of Team Development
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98
STAGE 1 STAGE 2 STAGE 3 STAGE 4
Team members
enthusiastic
about new team:
commitment high
only beginning
to work
together:
competence low
Experience
temporary lapse
of commitment
to the team as
they struggle to
find a good way
to work together
team learns:
competence
rises
Team has found
and agreed a
good way to
work:
commitment and
competence high
Competence
established at
high level
Commitment
may surge or dip
depending how
disbanding the
team handled
Team development basics
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99
of the performing organization has great bearing on
team development on projects
Efforts to develop team are complicated
When individual team members are accountable to both
a functional manager and the project manager
Its project managers responsibility
to balance this relationship and get the due
contribution and cooperation
of the team members!
Develop Project Team process overview
INPUTS
TOOLS &
TECHNIQUES
OUTPUTS
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00
Project Staff
assignments
Project management
Plan
Resource calendars
INPUTS
TECHNIQUES
Interpersonal Skills
Training
Team-building
Activities
Ground rules
Co-location
Recognition and
rewards
OUTPUTS
Team Performance
assessments
Enterprise
Environmental
Factors Update
INPUTS
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01
Team development starts with the
list of the project team members,
project staff assignments
documents identify the people who
are on the team.
Develop
project team
INPUTS
Provides human resource plan
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02
Provides human resource plan
which Identifies training strategies and
plans for developing project team
members.
The project moves on and so do project
team assessments, resulting in addition
of items like rewards, feedback,
additional training, and disciplinary
actions to the plan.
INPUTS
Resource Calendars
Identifies
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03
Identifies times that project team
members can participate in team
development activities.
Develop Project Team Tools & Techniques
Interpersonal skills
Sometimes known as soft skills, play Important
Role in team development.
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04
Role in team development.
The project management team can GREATLY
REDUCE problems and increase cooperation
By understanding the SENTIMENTS OF
TEAM MEMEBRS, ANTICIPATING THEIR
ACTIONS, ACKNOWLEDGING THEIR
CONCERNS, AND FOLLOWING UP ON THEIR
ISSUES.
Develop Project Team Tools & Techniques
Interpersonal skills
Skills that help you managing team
members:
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05
members:
1) Empathy
2) Influence
3) Creativity
4) Group facilitation
Develop Project Team process Tools & Techniques
Training
All activities designed to enhance competencies
of team members. Can be formal, informal.
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06
of team members. Can be formal, informal.
Class room, online, computer-based, on-the-
job assisted by another team member,
mentoring, and coaching.
Please remember if anyone lacks necessary
managerial or technical skills, these skills
must be developed as part of project work.
Tools & Techniques
Training
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07
Planned Training: scheduled in
staffing management plan.
Unplanned Training: result of
observation, conversations,
performance appraisal conducted
during the process Manage Project
Team in Controlling!
Tools & Techniques
Team-building activities
Vary from:
1. Five-minute agenda item in status
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08
1. Five-minute agenda item in status
review meeting to
2. Off-site, professionally facilitated
TEAMBUILDING WORKSHOP
3. Involving non-management level
team members in the planning
process, also develops team spirit.
Team-building activities
You should also:
Encourage informal communication
Tools & Techniques
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09
Encourage informal communication
and activities as they establish trust
and build good working relationships!
Please remember team building
strategies are quite necessary for
virtual team as they dont get the
benefit of face-to-face contact!
Team-building activities: discussion
As ongoing process, team building is crucial to
project success. Changes in project
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10
project success. Changes in project
environment are inevitable, and to manage them
effectively, a continued or a renewed team
building effort must be applied!!
Project Manager must continually monitor team
functioning and performance to determine if any
actions are needed to prevent or correct team
problems!!!
Team-building activities: discussion
Five stages (Tuckman ladder of team development)
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11
1) Forming
2) Storming
3) Norming
4) Performing
5) Adjourning
These occur in order but a
team may get stuck up at one
stage or slip to an earlier one.
Team Members who have
worked in the past may even
skip a stage!
We have already talked about these stages
Ground rules
Tools & Techniques
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12
Please establish clear expectations of
acceptable behavior by project team
members!
Early commitment to these guidelines
reduces misunderstanding and
increases productivity!
Form by joint participation so that team
members share responsibility to follow
them.
Co-location
Placing all or most of the active team
members at same location increases
Tools & Techniques
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13
members at same location increases
their ability to work as a team. It may
be: a) temporary, b) at strategically
important times, or c) for entire
project. Co-location strategy includes: A
meeting room, sometimes called war room,
having electronic devices, place to post
schedules, and other conveniences to
EHNHANCE COMMUNICATION and A
SENSE OF COMMUNITY!
Co-location
When co-location is thought to be a
good strategy, the use of virtual team
Tools & Techniques
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good strategy, the use of virtual team
members will reduce the frequency
that team members are located
together!
Recognition and Rewards
Is part of the team development
process.
Tools & Techniques
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process.
Recognize and reward desirable
team behavior.
Please remember:
1) Ways to reward developed during
HR Planning process.
2) Awards decisions are made during
Manage Project Team process
through performance appraisals.
CAUTION! Only desirable
behavior should be rewarded!
Tools & Techniques
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16
Please remember:
1) Willingness to work overtime to
meet an aggressive schedule
should be recognized/rewarded.
2) Needing to work overtime due to
poor planning should not be
rewarded.
CAUTION! Only desirable
Tools & Techniques
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17
Please remember:
3) Win-lose rewards (that only some team
members can achieve, like of the
month) destroys cohesiveness.
4) Reward win-win behavior that everyone
can achieve (like progress reports in
time) increases team spirit.
5) Consider cultural differences! Team
rewards in a culture of individualism will
be difficult to work.
OUTPUTS
Team performance
assessment
Effective team development
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Effective team development
strategies and activities increase
Teams Performance, which in
turns increases chances of
achieving project objectives!
We come to know this by
assessing team performance.
Develop Project Team process OUTPUTS
Team performance assessment
Informal and formal assessments of teams
effectiveness (resulting from team
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19
development activities):
1) Improvement in skills (that allow one to
perform more effectively).
2) Improvement in competencies and
sentiments that help the team to perform
better as a group.
3) Less staff turnover
Informal and formal assessments of teams
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20
development activities):
4) Increased team cohesiveness where team
members share information and experiences
openly and help each other to improve the
overall project performance!
Please remember
Such assessments can also identify need for
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21
Such assessments can also identify need for
Some specific training, coaching, mentoring,
assistance, or changes to improve the teams
performance.
Please note
This is especially important if team members are part of
a union, involved in collective bargaining, bound by
contract performance clauses, or other related
situations!
OUTPUTS
Factors Updates
may include
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22
may include
Personnel Administration,
including updates for
Employee Training Records
Skill Assessments.
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23
Manage Project Team
Manage Project Team
Involves:
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24
1) Tracking team member performance
2) Providing feedback
3) Resolving issues
4) Coordinating changes to enhance project
performance
Manage Project Team
HOW? Well, the project management team:
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25
HOW? Well, the project management team:
1) Observes team behavior
2) Manages conflict
3) Resolves issues
4) APPRAISES TEAM MEMBER
PEROFRMANCE
Manage Project Team
RESULT?
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26
RESULT?
1) Staffing management plan is updated.
2) Change requests are submitted.
3) Issues are resolved.
4) Inputs provided to performance appraisals
5) Lessons learned are added to organizations
database.
Manage Project Team
CAUTION!
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27
CAUTION!
Managing team members becomes difficult when they
report to two bosses! Functional Managers and Project
Managers (in matrix organization).
Project success largely depends on how well this dual
reporting relationship is managed.
Its responsibility of Project Manager to manage it
nicely! Remember it!!
Manage Project Team
CAUTION!
CAUTION!
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28
CAUTION!
Team Management
requires a combination of
skills with special emphasis
on:
1) Communication
2) Conflict Management
3) Negotiation, and
4) Leadership.
CAUTION!
Project Managers should
provide challenging
assignments to the team
members and provide
recognition for high
performance.
Manage Project Team process overview
INPUTS
TOOLS &
TECHNIQUES
OUTPUTS
Change Requests
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Project staff
assignments
Project Management
Plan
Team performance
assessment
Performance Reports
Organization Process
Assets
INPUTS
Observation and
conversation
Project
performance
appraisals
Conflict
management
Issue log
Change Requests
Enterprise
Environmental factors
Update
OPAs updates
PM Plan updates
Manage Project team process INPUTS
Provide a list of team members to be evaluated.
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Provide human resource plan which gives us
information on:
A) ROLES AND RESPONSIBILITES
B) PROJECT ORGANIZATION
C) STAFFINGMANAGEMENT PLAN a list of R & R
to be used to monitor and evaluate performance.
Team Performance Assessments
(ongoing, formal/informal)
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31
Helps take actions to resolve
issues, modify communication,
address conflict, and improve team
interactions.
Performance reports
Results from control processes, such as:
1) schedule control, cost control
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32
1) schedule control, cost control
2) quality control, scope verification
3) procurement audits
Results from performance reports
including forecasts helps decide:
a) recognition & rewards,
b) future HR requirements
c) updates to staffing management plan
That can influence this process:
1) Certifications of appreciation
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33
1) Certifications of appreciation
2) Newsletters
3) Websites
4) Bonus structures
5) Corporate apparel, and
6) Other organizational perquisites.
Observation & conversation
To be in touch with work and attitudes of
team members. PM team monitors:
Manage Project Team process Tools & Techniques
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34
team members. PM team monitors:
1) Progress toward project
deliverables.
2) Accomplishments that are
source of pride among team
members.
3) Interpersonal issues
Project performance appraisals
(feedback)
Performance Feedback to team
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35
Performance Feedback to team
members from their supervisors. It can
also be 360-degree (from superior,
peer, and subordinates). Objectives?
1) To re-clarify Roles & responsibilities,
2) To ensure positive feedback is
given through a Structured Time in an
otherwise hectic environment.
Project performance appraisals
(feedback)
Objectives?
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36
Objectives?
3) Discover unknown and unresolved
issues,
4) Develop individual training plans, and
5) Establish specific goals for future time
periods.
Conflict management
Conflict is an inevitable part in a project
environment. Successful conflict
ANSWER:
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37
environment. Successful conflict
management increases productivity and
brings in positive working relationships.
Sources of conflict?
- scarce resources
- scheduling priorities
- personal work styles
Conflict management
What can help?
- Team ground rules
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38
- Team ground rules
- Solid project management
practices (communication
planning, role definition, etc.)
Benefit? If managed properly.
Differences of opinion are healthy
Leads to enhanced creativity
Better decision-making
Conflict management
Please remember that differences become a
negative factor, team members are first responsible
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39
negative factor, team members are first responsible
to resolve their own conflicts.
If it is not resolved and escalates, then the
project manager must facilitate satisfactory
resolution.
Conflict management
Please remember
Conflict should be addressed EARLY and usually
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40
Conflict should be addressed EARLY and usually
IN PRIVATE, using a direct, collaborative
approach!
If disruptive conflict continues, formal
procedures may be used, including
disciplinary actions. it is not resolved and
escalates, then the project manager must facilitate
satisfactory resolution.
MOST VITAL POINTS:
1. CONFLICT IS NATURAL AND FORCES A SEARCH
FOR ALTERNATIVES
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41
FOR ALTERNATIVES
2. CONFLICT IS A TEAM ISSUE
3. OPENESS RESOLVES CONFLICTS
4. CONFLICT RESOLUTION MUST FOCUS ON
ISSUES, not personalities
5. Conflict resolution should focus on present, not
past!
Success in managing project teams depends
largely on the ability to resolve conflict.
Factors that effect conflict resolution methods:
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42
Factors that effect conflict resolution methods:
1. Relative importance and intensity of conflict
2. Time pressure for resolving conflict
3. Position taken by players involved
4. Motivation to resolve conflict on long-term or
short-term basis.
Conflict resolution techniques:
1. Withdrawal/avoiding
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43
1. Withdrawal/avoiding
2. Smoothing/accommodating
3. Compromising
4. Forcing
5. Collaborating
6. Confronting/Problem Solving
1. Withdrawal / Avoiding: Retreating from an
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44
1. Withdrawal / Avoiding: Retreating from an
actual or potential conflict situation.
2. Smoothing / Accommodating: Emphasizing
areas of agreement rather than areas of differences.
3. Compromising: searching for solutions that bring
some degree of satisfaction to all parties.
4. Forcing: Pushing ones point of view at the
expense of others. Win-Lose.
5. Collaborating: Incorporating multiple point of
views and insights from differing perspectives. Leads
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45
views and insights from differing perspectives. Leads
to consensus, commitment.
6. Confronting/Problem Solving: Treating
conflict as a problem to be solved. A written log
documents and helps monitor who is responsible for
resolving by a target date. Needs give-and-take
attitude and open dialogue.
Issue log (issues arising during managing
project team)
Helps so much! Documents persons
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Helps so much! Documents persons
responsible to resolve issues by a target
date. Addresses obstacles that may stall
team from achieving goals.
Example of obstacles:
Differences of opinion
Situations to be investigated
Emerging/unanticipated responsibilities (need
to be assigned to someone in project team)
Project managers use a combination of
technical, human, and conceptual skills to
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47
technical, human, and conceptual skills to
analyze situations and interact appropriately
with team members.
Please note:
Using appropriate interpersonal skills aids
project managers in capitalizing on the
strengths of team ALL members!
1. Leadership
2. Influencing
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2. Influencing
3. Effective decision making
Leadership: Communicate the vision
and inspire the project team to achieve
high performance. Important through all
phases of project life cycle.
1. Leadership
2. Influencing
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49
2. Influencing
3. Effective decision making
Influencing: Ability to influence
stakeholders on a timely manner,
especially in a matrix environment where
project manager have little or no direct
authority.
Key Influencing skills:
1. Ability to be persuasive and clearly
articulate points and positions.
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50
articulate points and positions.
2. High levels of active and effective
listening habits
3. Consideration of various perspectives
4. Gathering relevant and critical
information to address important issues
and reach agreements.
Effective decision making
Ability to negotiate and influence the organization
and the project management team. GUIDELINS:
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and the project management team. GUIDELINS:
1. Focus on goals to be served
2. Follow a decision-making process
3. Study environmental factors
4. Develop personal qualities of the team members
5. Stimulate team creativity, and
6. Manage opportunity and risk.
Change Requests
Staffing changes emerging from this process
( whether by choice or by uncontrollable
Manage Project Team process OUTPUTS
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52
( whether by choice or by uncontrollable
events) can cause schedule to be extended,
budget to be exceeded, etc. Staffing issues
can disrupt project plan.
These change requests are examined by ICC
and then approved with due consideration of
their impact on the project!
Change Requests
Staffing changes can include:
1. Moving people to different assignments
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53
1. Moving people to different assignments
2. Outsourcing some work
3. Replacing team members who leave
4. Preventive actions to reduce probability and
impact of problems before they occur. Example:
a) Cross-training to reduce problems during team
member absences
b) Additional role clarification to ensure all
responsibilities are fulfilled.
OPAs updates
1) inputs to performance appraisals
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54
1) inputs to performance appraisals
of team members. Provided by project
staff for team members with whom they
interact significantly.
2) HR-Related lessons learned posted
in historical database
examples
OPAs updates
HR-Related lessons learned posted in
historical database:
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55
1) Project org. charts, position
descriptions, staffing management plan
(kept as templates).
2) Ground rules, conflict management
techniques, and recognition events that
proved so good.
examples
OPAs updates
HR-Related lessons learned posted in
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56
3) Procedures for co-location, virtual
teams, training, negotiation, and team
building that proved so useful.
4) Special competencies or skills of team
members discovered during project.
5) Issues and their solutions from issue
log.
Factors Updates
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57
1. Input to organizational
performance appraisals.
2. Personal Skills Updates
Project Management plan
Updates
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58
1. Staffing management plan
Perform Quality assurance
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59
The process of
Auditing the quality requirements and
results from quality control measurements
Assurance may be provided to ensure
appropriate quality standards and
operations definitions are used!
Please remember
A quality assurance department, or similar
organization, often oversees quality
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60
organization, often oversees quality
assurance activities.
Quality assurance support may be provided
to the project team, the management of the
performing organization, the customer or
sponsor, as well as other stakeholders not
actively involved in the project!
Please remember
This process provides and umbrella for
Continuous Process Improvement, that is
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Continuous Process Improvement, that is
an iterative means for improving quality of all
processes.
Quality assurance
CONTINOUS PROCESS IMPORVEMENT
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62
CONTINOUS PROCESS IMPORVEMENT
Reduces waste and eliminates activities that do
not add value non-value-added activities,
Increases efficiency and effectiveness of
processes,
Reviews and improves organizational business
processes.
Perform Quality Assurance process overview
INPUTS
TOOLS &
TECHNIQUES
OUTPUTS
Change Requests
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Project Management
Plan
Quality metrics
Work performance
information
Quality control
Measurements
Plan Quality and
perform Quality
Control Tools &
Techniques.
Quality Audits
Process analysis
Change Requests
Organizational
process assets
updates
Project management
plan updates
Project Document
Updates
Project management
Plan provides
1. Quality Management Plan
Perform Quality
assurance
INPUTS
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64
prescribes how quality will be
performed within the project.
2. Process Improvement Plan
details steps for analyzing
processes to identify activities
that enhance value and the ones
do not add value.
Quality metrics
We have dealt with this also during
quality planning and we use them
Perform Quality
assurance
INPUTS
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65
quality planning and we use them
as another important input here.
Work performance
information
Needed for quality audit, reviews,
Perform Quality
assurance
INPUTS
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66
Needed for quality audit, reviews,
process analyses. Includes:
1) Technical performance measures
2) Project deliverables status
3) Required corrective actions
4) Performance reports
Quality control
measurements
Are results of quality control
Perform Quality
assurance
INPUTS
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Are results of quality control
activities.
Based on the these results, we
reanalyze and reevaluate the
quality standards and processes
during QA process!
Perform Quality
Assurance
Tools &
Recap
Plan Quality & Perform Quality Control
tools & techniques: already discussed
Benefit/Cost analysis
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Techniques
Quality audits
carried out to identify: lessons learnt that can
improve performance of the present project,
and also of other projects in performing
organization
Benefit/Cost analysis
Benchmarking
Flowcharting
Design of experiments
Cost of quality
Quality audits
A structured, independent review
Perform Quality
Assurance
Tools &
Techniques
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A structured, independent review
(scheduled or random, in-house or by
outside third party) to determine WHETHER
PROJECT ACTIVITIES COMPLY WITH
ORGANIZATIONAL AND PROJECT
PLOICIES, PROCESSES, AND
PROCEDURES!
Quality audits
OBJECTIVES:
Perform Quality
Assurance
Tools &
Techniques
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OBJECTIVES:
1. Identify all the good /best practices are being
implemented,
2. Identify all gaps,
3. Share the good practices introduced or
implemented in similar projects in the
organization or the industry,
4. Proactively offer assistance in a positive manner
to improve implementation of processes to help
team
Quality audits
OBJECTIVES:
Perform Quality
Assurance
Tools &
Techniques
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OBJECTIVES:
4. Proactively offer assistance in a positive manner
to improve implementation of processes to help
team raise productivity,
5. Highlight contributions of each audit in the
Lessons Learned repository of the organization.
Advantage
Quality audits
ADVATAGE: Subsequent efforts to correct these
Perform Quality
Assurance
Tools &
Techniques
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ADVATAGE: Subsequent efforts to correct these
deficiencies will result in:
Reduced cost of quality
Increase in the percentage of
acceptance of the product/service by
the customer or sponsor
Quality audits confirm the implementation of
approved change request/corrective/preventive
actions/defect repairs!
Perform Quality
Assurance
TOOLS &
Process analysis
Done by following steps written in
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73
TECHNIQUES
Done by following steps written in
process improvement plan.
PURPOSE?
To find out required improvements
from the technical and organizational
point of view!
HOW?
Process analysis
What do you analyze during process operations?
Perform Quality
Assurance
TOOLS &
TECHNIQUES
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What do you analyze during process operations?
1. Problems experienced
2. Constraints experienced
3. Non-value-added activities identified
We conduct root cause analysis, may use a
specific technique to analyze a problem/situation,
to understand underlying causes. Then, we decide
preventive actions TO AVOID SIMILAR
PROBLEMS.
Change Requests
Requests for actions to be taken for quality
Perform Quality
Assurance
OUTPUTS
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Requests for actions to be taken for quality
improvement for the increasing the
efficiency and effectiveness of policies,
processes, and procedures of the
performing organization.
TO PROVIDE ADDED BENEFITS
TO THE STAKE HOLERDS OF
ALL PROJECTS!
updates
Perform Quality
Assurance
TOOLS &
TECHNIQUES
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76
updates
2. Schedule Management Plan
3. Cost Management Plan.
updates
Perform Quality
Assurance
TOOLS &
TECHNIQUES
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77
updates
What are these changes?
1. Incorporation of processes that have been
through continuous process improvement (and
are ready to repeat the cycle).
2. Improvements to processes that have been
identified and measured (and are ready for
implementation).
Project management
Plan updates
Perform Quality
Assurance
TOOLS &
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78
Plan updates
These changes can lead to:
1. Additions
2. Modifications
3. Deletions
to the Project management Plan
and its Subsidiary Plans, after
they are processed and
approved by ICC process.
TECHNIQUES
OPA Updates
may include
Perform Quality
Assurance
TOOLS &
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79
may include
Quality Standards
include
1. Quality Audit Reports.
2. Training Plans, and
3. Process Documentation.
TECHNIQUES
DISTRIBUTE
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DISTRIBUTE
INFORMATION
Project Communication Management
DISTRIBUTE INFORMATION
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81
Timely communication of needed information
to project stakeholders
Implementing communications management
plan
Attending to unexpected requests for
information
DISTRIBUTE INFORMATION
Sample
Project information distributed:
status
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progress, success
forecast
variance report
corrective action
problems, new risks discovered
updated project plans/ components of project
plan
team members performance
meeting schedule , etc
DISTRIBUTE INFORMATION - Sample
Project information is distributed to
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83
internal to the project
external to the project
management
sponsor
functional managers
team
team members managers
other project managers
project manager
other stakeholders
Distribute Information process overview
INPUTS
TOOLS &
TECHNIQUES
OUTPUTS
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Project Management
Plan
Performance Reports.
Assets
INPUTS
TECHNIQUES
Communications
Methods
Information
Distribution
Tools
OUTPUTS
OPAs Updates
The Project Management Plan contains the :-
Communications management plan which
includes:-
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includes:-
Stakeholder communication requirements
Information to be sent, format, content, detail
Persons responsible for communication
Persons/groups to be communicated
Methods of communication
Frequency (weekly, monthly)
Escalation process-identifying timeframes and
the management chain (names) for escalation
issues that cant be solved at lower level
Communications management
plan
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plan
contains
Method for updating and refining
communications management plan AS PROJECT
PROGRESSES
GLOSSARY OF COMMON TERMINOLOGY (VERY
IMPORTANT)! WHY?
Performance Reports:-
They are used to distribute project performance
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They are used to distribute project performance
and status information. It should be as precise
and current as possible.
OPAs include:-
Policies, Procedures, and guidelines regarding
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88
Policies, Procedures, and guidelines regarding
information distribution.
Templates, and
Historical Information and Lessons Learned.
includes:-
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includes:-
Individual and group meetings.
Video and Audio Conferences.
Computer Chats
Remote Communication Methods are used to
distribute information.
Information distribution
methods
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methods
Using various methods to send project
information to the stakeholders as per their
needs.
Examples:
project meetings
videoconferencing, web conferencing
voice mail, fax, telephone
email, fax, shared networked databases
hard copy, web publishing
Web interfaces, virtual office, portals, etc.
OPAs Updates
Consist of
1) Lessons learned documentation
Distribute
Information
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2) Project records
3) Project reports
4) Project presentations
5) Feedback from stakeholders
6) Stakeholder notifications Lessons
OPAs Updates
1. Lessons learned
documentation: OPAs are
Distribute
Information
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92
documentation: OPAs are
updated as new lessons learned are
included in its database!
What is documented?
a) Causes of issues
b) Reasoning behind corrective action
chosen
c) Other types of lessons learned
about information distribution
OPAs Updates
2. Project records Are documents
that describe the project. They are
Distribute
Information
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93
that describe the project. They are
arranged and kept in an organized
manner. Project team can also
maintain records in a project
notebook.
Project record Examples:
correspondence
memos
documents describing the project
OPAs Updates
3. Project reports
Formal or informal project reports
Distribute
Information
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94
Formal or informal project reports
detailing:
Project status
Lessons learned
Issue logs
Project closure reports
Outputs from other knowledge areas
OPAs Updates
Distribute
Information
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95
OPAs Updates
4. Project presentations
Are made by the project team to the
stakeholders to satisfy their information
needs by using appropriate formal or
informal methods.
OPAs Updates
Distribute
Information
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96
OPAs Updates
5. Feedback from stakeholders
Information received from stakeholders
concerning project progress.
Distributed and used to modify or
improve future project performance!.
OPAs Updates
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97
OPAs Updates
6. Stakeholder notifications
Information provided to stakeholders
about:
1) Approved changes
2) Resolved issues
3) General project status
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98
Manage Stakeholder
Expectations
Process of communicating and working
Manage Stakeholder Expectations
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99
Process of communicating and working
with stakeholders to meet their needs and
addressing their issues as they occur.
Involves communication activities directed toward
project stakeholders to influence
their expectations, address concerns, and resolve their
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00
issues, such as:
1) Actively managing their expectations to increase
chances of project acceptance by negotiating
and influencing their desires to achieve and
maintain project goals.
2) Addressing concerns that have not become
issues yet, often related to anticipation of future
problems.
Involves communication activities directed toward
project stakeholders to influence
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01
issues, such as:
3) Clarifying and resolving issues identified. This
may result in a change request or may be
addressed outside the project (postponed for
another project or phase or deferred to another
organizational entity).
ADVANTAGE:
Managing stakeholder expectations helps increase the
probability of project success by ensuring that the
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02
probability of project success by ensuring that the
stakeholders understand the project benefits and risks.
This enables them to be ACTIVE SUPPORTERS of the
project and to help with risk assessment of project
choices!
By anticipating their reaction to the project, we can take
preventive action TO WIN THEIR SUPPORT or
minimize potential negative impacts.
WHOSE DUTY?
Project Manager is responsible. It decreases
the risk that the project will fail to meet its
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03
the risk that the project will fail to meet its
goals and objectives due to unresolved
stakeholder issues. It limits disruptions during
the project!
Manage Stakeholder Expectations process overview
INPUTS
TOOLS &
TECHNIQUES
OUTPUTS
Change Requests
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04
Strategy
Issue Log
Change Log
OPAs
INPUTS
Communication
methods
Interpersonal
Skills
Management Skills
Change Requests
Project Document
Updates
OPAs updates
PM Plan updates
Manage Stakeholder Expectations - INPUTS
1. Stakeholder Register
Provides list of the relevant stakeholders. Used to
ensure all stakeholders are included in the project
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05
ensure all stakeholders are included in the project
communications!
2. Stakeholder Management Strategy
Gives an understanding of stakeholder goals and
objectives. The strategy documented immensely
helps us here in managing stakeholder
expectations.
provides
a) Communications management plan. The needs
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06
a) Communications management plan. The needs
and expectations are identified, analyzed, and
documented in the communications management
plan.
b) Stakeholder requirements and expectations
provide an understanding of their goals, objectives,
and level of communication required during the
project.
4. Issue logs (action-item log)
A tool used to record and monitor Resolution of
Issues! Please note:
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07
Issues! Please note:
1) The purpose of issue resolution is to maintain
good, constructive working relationships among
different stakeholders (including team members!).
2) An issue must be stated in such a way that its
resolution becomes feasible.
4. Issue logs (action-item log)
Please note:
3) For each issue the responsibility is assigned and a
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08
3) For each issue the responsibility is assigned and a
target date is fixed for closure!
4) Unresolved issues can become major source of
conflict and may delay project!
5. Change Log
Used to record changes that occur during the
project. These changes and their impact (time, cost,
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09
project. These changes and their impact (time, cost,
and risk) must be communicated to the concerned
stakeholders.
6. Organizational Process Assets
- organization communication requirements
- Issue mismanagement procedures
- Change control procedures
- Historical information
Methods of communication identified for each
stakeholder (in communication management plan)
Manage Stakeholder Expectations Tools & Techniques
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10
stakeholder (in communication management plan)
are used during stakeholder management.
2. Interpersonal Skills
Project Manager applies toward:
a) Building Trust,
b) Resolving conflict,
c) Active listening, and
d) Overcoming resistance to change.
3. Management Skills
Managing is the act of directing and controlling
a group of people for coordinating an
Manage Stakeholder Expectations Tools & Techniques
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11
a group of people for coordinating an
harmonizing toward achieving a goal that is
beyond the scope of individual effort!
Project Manager uses these management skills:
a) Presentation skills
b) Negotiating
c) Writing skills
d) Public Speaking
Manage Stakeholder Expectations OUTPUTS
1. Organizational process updates
Posting lessons learned like causes of
issues and logic behind corrective action
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12
issues and logic behind corrective action
chosen, plus other type of lessons learned
about stakeholder management!
2. Change requests
Managing stakeholder expectations may
result in a change request to the product or
the project. It may also include corrective or
preventive actions.
3. Project Management Plan updates
Communication Management plan, that is part
of the project management plan, may be
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13
of the project management plan, may be
updated when NEW Communication
Requirements are identified!
EXAMPLE:
- Some communication may no longer be
necessary,
- An ineffective method is replaced,
- A new communication requirement identified.
3. Project Documents updates
- Stakeholder Management Strategy:
Updated as a result of addressing concerns and
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14
Updated as a result of addressing concerns and
issues.
- Stakeholder register: Updated as information
on stakeholders change. Example: New
stakeholders identified, if registered
stakeholders are no longer involved in or impacted by
the project, or other updates for any stakeholder.
- Issue Log: Updated as new issues identified and
current ones are resolved!
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Conduct Procurements
PROCESS
Consists of
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16
Consists of
Obtaining responses (bids, proposals) from
prospective sellers, selecting a seller, and awarding a
contract.
The project team receives proposals, applies
previously defined selection criteria to select seller.
On major procurement items, the overall process of
requesting responses may be repeated!
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17
requesting responses may be repeated!
A short list of qualified sellers made based on
Preliminary proposal. More detailed evaluation is done
on the basis of more detailed requirements document
Obtained from short-listed ones.
Additionally, tools & techniques can be used alone or
combination.
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18
combination.
Example
A weighting system may be used to:
- select a single seller who will sign a standard
contract.
- Establish a negotiating sequence by ranking all
proposals by weighted evaluation.
Conduct procurements process overview
INPUTS
TOOLS &
TECHNIQUES
OUTPUTS
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19
OPAs
Project management
plan
Procurement
documents
Source selection
criteria
Qualified seller list
Seller proposals
Project documents
Teaming agreements
INPUTS
TECHNIQUES
Bidder Conferences
Advertising
Proposal
evaluation
techniques
Independent
estimates
Expert judgment
Internet search
Procurement
negotiations
OUTPUTS
Selected sellers
Procurement
contract award
Resource calendars
Change requests
Procurement
management plan
updates
Project document
updates
1. OPAs
List or files with information on
prospective or previously qualified
Conduct
Procurement
INPUTS
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20
prospective or previously qualified
sellers. We can invite them to bid,
propose or quote on work.
Provides information on
prospective sellers past
experience and other
characteristics.
Some companies maintain
preferred sellers list, selected
through some qualification
method.
INPUTS
2. Project management plan
provides procurement
management plan for use here.
Conduct
Procurement
INPUTS
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management plan for use here.
We have discussed about it
during plan procurements.
3. Procurement documents
We have discussed about
procurement documents during
plan contracting.
INPUTS
4. Source selection
criteria
Conduct
Procurement
INPUTS
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22
We use it as an as key input here.
Involves examining samples of the
suppliers (previously produced
products) to evaluate their
capabilities and product quality
Involves reviewing suppliers past
record with the contracting
organization and other buyers
INPUTS
Project Procurement Management Project Procurement Management
5. Qualified sellers list
Pre-screened for their qualifications and past experience.
We developed Qualified sellers list using:
Conduct
Procurement
INPUTS
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23
We developed Qualified sellers list using:
1) Lists already available (OPA)
2) Internet, library directories, local associations, trade catalogues,
or similar sources
3) Site visits (when more extensive efforts needed)
4) Contact with previous customers
Procurement documents can also be sent to find if
some or all prospective sellers are willing to quote!
6. Proposals (quotations/bids)
Seller-prepared documents made in
Conduct
Procurement
INPUTS
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24
accordance with the requirements of
procurement documents.
Describe sellers ability and willingness to
provide the requested products, as
described in the procurement documents.
Reflect the application of applicable
contract principles.
INPUTS
7. Project documents
We consider following documents:
Conduct
Procurement
INPUTS
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1. Risk register
2. Risk-related contract decisions
8. Make-or-buy decisions
We have discussed already
9. Teaming agreements
Whenever such an agreement is in place
consider following documents:
Conduct
Procurement
INPUTS
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consider following documents:
1. Risk register
2. Risk-related contract decisions
Conduct Procurements TOOLS & TECHNIQES
Bidder conferences (pre-
bid/vendor/contractor conferences)
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27
Meetings with prospective
sellers prior to preparation of a
proposal by sellers in response
to buyers RFP.
Bidder conferences aims at ensuring that
1) Each prospective seller has a common understanding of
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28
1) Each prospective seller has a common understanding of
the procurement (technical requirements, contract requirements,
etc.)
2) All potential sellers must remain on equal standing during
the process.
Responses to questions may be incorporated into the
Procurement documents as amendments.
Advertising
Inviting proposals from
prospective sellers by putting
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29
prospective sellers by putting
advertisements in newspapers or
professional journals
The purpose of this method is:
to have a wider base than the
existing list of potential sellers.
for certain government departments,
it is mandatory to advertise in order
to procure the goods or services.
Real life example
Request for Proposal (RPF)
For collection, Transportation and Disposal of Hotel Waste
Under Green Lines Services Project of JMC
1. STATEMENT OF WORK
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1. STATEMENT OF WORK
The Green Line Services Project is an ambitious project of
Jaipur Municipal Corporation (JMC) under which a private
Entrepreneur will be issued a license to collect, transport, process
and dispose off the waste generated from hotels, restaurants,
sweets shops, canteens, and other eating joints. Processing may
be by any suitable means like Vermicomposting/ Composting/
Biogas or any other method as per MSW Rules 2000.
The approximate number of hotels under different categories are:
(I) Five Star-9, (II) Other Starred Hotels and A/C Restaurants-70,
(III) Others-900 with overall approximate biodegradable waste
Real life example
1. STATEMENT OF WORK (continued)
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1. STATEMENT OF WORK (continued)
quantity as 10 tons per day. However the interested bidders
should ascertain themselves about the quantity and number of
generating units before submission of the bid.
The project has to be operated on Build, Own, Operate (BOO)
basis by the license holder by collecting user charges for initial
period of three years.
2. INVITATION
sealed tenders are invited from interested contractors having
experience of working in the field in the two envelope systems:
Envelope A (Technical offer) and Envelope B (Financial offer)
Real life example
2. INVITATION (continued)
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2. INVITATION (continued)
The tender documents may be obtained on during office-hours
from 28.01.05 to 10.02.05 from:
The Office of Senior Health Officer
Civil Lines Zone, JMC, Jaipur (RAJ)
Tel: xxxx- xxxxxxx
3. A pre-bid meeting is arranged on 5.02.05 at 3:00 P.M. in the
conference hall of JMC Head Office.
4. Completed tender must be submitted up to 11.02.05 till 3:00 P.M.
5. Envelope A (Technical offer) shall be opened on 11.02.05 at 4:00
P.M. in the presence of bidders at Conference Hall of JMC.
Real life example
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33
5. Envelope B (Financial offer) shall be opened on suitable date for
which separate intimation shall be sent to the qualified bidders.
6. Interested eligible Bidders may obtain further information from the
office of the Senior Health Officer.
Name: xyz
Designation:
Proposal evaluation techniques
On complex procurements, source selection is done
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34
Based on previously defined weighted criteria! Buyers
procurement policies define a formal evaluation
process!
The evaluation committee makes their selection for
approval by management prior to the award!
Evaluates proposals based on
quantifying qualitative data
Weighting system
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quantifying qualitative data
Minimizes the effect of personal
prejudice on source selection
THE PROCESS
1) Assigns a weight to each criterion
2) Rates prospective proposals on
each criterion
3) Multiplies rates with weight
4) Totals the results to arrive at
PROPOSAL-WISE SCORE
Weightage Score Total
Evaluation Criteria
Sample Weighting system
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36
Weightage
% (W)
Score
(S)
Total
(W x S)
Evaluation Criteria
Understanding of need
Life cycle cost
Technical capability
Sellers management approach
Price
Financial capability
Total of weightage (100) Sum W x S
CASE STUDY: DCA 21 PROJECT
1) EVALUATION CRITERIA using five point scale
Criteria
1 2 3 4 5
Technical solutions
Bad Poor
Adequate
Good
Excellent
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Technical solutions
approach
Bad Poor
Adequate
Good
Excellent
Price
above
1.8
1.6-1.8 1.4-1.6 1.2-1.4 Below
1.2
Project organization and
management
Bad Poor
Adequate
Good
Excellent
Likelihood of meeting
schedule / cost targets
Bad Poor
Adequate
Good
Excellent
Reputation of seller
Bad Poor
Adequate
Good
Excellent
2) Simple Rating using five point scale
CRITERIA
Proposal
A
Proposal
B
Proposal
C
Provided scores (S)
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Technical solutions approach
4 2 5
Price
5 5 2
Project organization and
management
5 3 4
Likelihood of meeting
schedule / cost targets
4 3 5
SUM SCORES
4
22
4
17
5
21
Criteria Weight
3) Criteria and Weights (W)
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Technical solutions approach
0.25
Price
0.25
Project organization and management
0.20
Likelihood of meeting schedule / cost targets
0.15
0.15
1.00
Final evaluation (S x W): Proposal A selected and awarded contract !
Proposal A Proposal B Proposal C
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S (S) (W)
4 1.0
CRITERIA
TECHNICAL SOLUTION
APPROACH
PRICE OF CONTRACT
PROJECT ORGANIZATION /
MANAGEMENT
REPUTATION OF SELLER
RISK OF SOLUTION
S (S) (W) S (S) (W)
WEIGHT
(W)
O.25
O.25
O.20
O.15
O.15
5 1.25
5 1.0
4 0.6
4 0.6
SUM 4.45
2 0.5
5 1.25
3 0.6
3 0.45
4 0.6
5 1.25
2 0.5
4 0.8
5 0.75
5 0.75
SUM 3.4 SUM 4.05
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Independent estimates
Serve as benchmark on proposed responses.
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Buyer can make its own independent estimates (can
also get it prepared by an outside professional
estimator). n complex procurements, source selection
is done
What does it mean if the difference between
independt estimate made by buyer anf the one
submitted by seller?
Independent estimates
What does it mean if the difference between
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43
independent estimate made by buyer and the one
submitted by seller?
Answer:
a) SOW was deficient or ambiguous! Or
b) Prospective seller has misunderstood or
c) Prospective seller failed to respond fully to the
procurement SOW
Expert judgment Used in evaluating proposals.
It may consist of multi-discipline review team in each
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It may consist of multi-discipline review team in each
of the areas covered by procurement documents and
proposed contract.
Expert may come from functional disciplines, such as:
- Contracting, Legal, Finance, Accounting,
Engineering, Design, R&D, Sales, and
manufacturing!
Internet search
Used to locate and expand search for suitable sellers.
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Used to locate and expand search for suitable sellers.
Caution:
Many commodities, and off-the-shelf items can be
quickly located and secured at a fixed price on the net
BUT
The high-risk, highly complex, procurement effort that
needs to be closely monitored can not be
accomplished through net.
Procurement negotiations
1. Clarify structure, requirements and other terms for
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1. Clarify structure, requirements and other terms for
mutual agreement before contract is signed!
2. Final contract language shows all agreements
reached, covering:
Responsibilities, authority to make changes,
applicable terms and governing laws, technical
& business management approaches, propriety
rights, contract financing, technical solutions,
overall schedule, payments, price.
Sample
Contract Negotiation
For
Complex items
N
Contract negotiations
for complex items is taken
up as an independent
process
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Open items list
Inputs
Issues
Open items list
Understanding
Outputs
Memorandum
of
Understanding
N
E
G
O
T
I
A
T
I
O
N
S
process
Conduct Procurements OUTPUTS
Selected sellers
Who are selected sellers?
Answer:
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Answer:
1) Those who are in the competitive
range
2) Who have negotiated a draft
contract (that will the actual contract
when it is awarded)
Procurement contract award
Contract !
(Called a contract, an agreement, a memorandum
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(Called a contract, an agreement, a memorandum
of understanding, a subcontract, or a purchase
order)
Once you sign it, it becomes a mutually binding
document with due obligations both sides:
1. obligates the seller to provide the specified
product
2. obligates the buyer to pay for it.
Contract !
What is inside a contract?
1) Section headings
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1) Section headings
2) SOW
3) Schedule
4) Period of performance
5) Roles and responsibilities
6) Pricing and payment,
7) Inflation adjustment
8) Acceptance criteria
9) Warranty, product support
10) Limitation of liability, fees, retainage
11) Penalties
Contract !
What is inside a contract?
12) Incentives
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12) Incentives
13) Insurance
14) Performance bonds
15) Subcontractor approval
16) Change request handling
17) A termination and dispute resolution
mechanism
Contract can be:
A complex document, or
A simple purchase order
Resource calendars
Documents the quantity and
availability of resources and the
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availability of resources and the
dates on which each specific
resource will be ACTIVE OR
IDLE.
Requested changes
This process may result in change requests relating to project
schedule, procurement management plan, etc. These
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schedule, procurement management plan, etc. These
requests are reviewed and disposed by Perform Integrated
Change Control process.
Project management plan updates
Updates to show approved changes to:
Cost baseline, scope baseline, schedule baseline, and
procurement management plan
Project Documents updates
- requirements documentation
Project Documents updates
- Requirements documentation
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- Requirements traceability documentation,
and
- Risk register
MONITORING &
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MONITORING &
CONTROLLING
PROCESS GROUP
The concept of Monitoring and
Controlling
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1.Checking performance
2. Managing changes
1.Checking performance against plan or
against baselines by conducting variance
analysis.
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analysis.
Variance analysis means comparing actual
with the plan.
Formula = Plan Actual
example: if you want to check my scope
performance, please compare the scope
performed and scope planned.
example: if you want to check my schedule
performance, please compare the actual start
and finish dates of a work completed and
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and finish dates of a work completed and
actual time taken in doing it with the dates
planned and duration written in schedule
baseline (approved schedule). It will give you
schedule variance, called performance
measurements, that may be:
SV = 0 or SV = + or SV = -
Checking performance
In case of variance:
1) Find causes of variance,
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1) Find causes of variance,
2) Find corrective action to recover,
3) Recommend it to ICC for approval.
ICC will review it and then approve.
Once ICC approves it and returns it to
Monitoring and controlling, then :
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60
1) Give it execution for implementation,
2) Write approved changes in the project plan.
This is called Replanning and done with the
help of configuration management system.
You had original project plan and when you
write approved changes, its version or
configuration changes.
This is called versioning. You must retain
all versions! This will help us understand
evolution of project management plan
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evolution of project management plan
through approved changes during the
project life cycle.
Also update project documents. We will learn
more on it as we proceed. Right now, we are
talking of concept.
Once ICC approves it and returns it to
Monitoring and controlling, then :
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3) Inform concerned stakeholders about
approved changes.
This was about the first part of the concept of
Monitoring and Controlling. Now, the second part:
Managing Changes.
2. Managing Changes: changes to scope,
schedule, cost, and quality. There is a standard
change control procedure.
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change control procedure.
Step one Step two Step three Step four
Change Evaluation, Recommend ICC reviews
Request Impact to ICC for and then
Analysis approval approves or
rejects.
2. Managing Changes:
once ICC approves and returns the change
request to you, then:
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request to you, then:
1) Give it to execution for implementation
2) Write approved changes in project
management plan.
3) Update project documents.
4) Inform concerned stakeholders about
approved changes.
Controlling Concepts
Prevention is better than cure
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65
Take
preventive
action
Anticipate
problems
Monitoring & Controlling Concepts
Purposes
of
Project control
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Project control
Identify problems
Solve problems
Get the project back on track as soon
as possible after problem has been
identified!
CONCEPT
THIS process group consists of processes to
observe project execution,
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67
observe project execution,
identify problems in timely manner,
recommend corrective action for problems that
have occurred,
recommend preventive action in anticipation of
possible problems,
thus bring the project into compliance with
the project management plan.
CONCEPT
Key benefit
project performance is observed and
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project performance is observed and
measured regularly to find variances from
the project management plan
continuous monitoring provides insight
into the health of the project and suggests
areas that need additional attention
CONCEPT
Key benefit
Monitors and controls not only the work
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69
Monitors and controls not only the work
being done in a process group but the entire
project effort!
When variances JOEPARDIZE PROJECT
OBJECTIVES, appropriate processes in
planning PM Group are revisited (as a part
of modified PDCA cycle), and pm plan may
get updated from such review!
example
CONCEPT
example
REQUIRES
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70
A MISSED
ACTIVITY FINISH
DATE
REQUIRES
ADJUSTMENTS TO CURRENT
STAFFING PLAN
RELIANCE ON OVERTIME
TRADEOFFS BETWEEN
BUDGET AND SCHEDULE
OBJECTIVES
CONCEPT
Key benefit
Monitoring the ongoing project activities
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Monitoring the ongoing project activities
against project management plan and the
project management baseline.
Influencing factors that could circumvent
integrated change control so that only
APPROVED CHANGES ARE
IMPLEMENTED.
example
Dynamics of Project Management Process Groups
Initiating Planning
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Initiating Planning
Monitoring
and
Controlling
Executing
Closing
Monitoring and Controlling: process interactions
Verify Scope Initiating
processes
Control Scope
Control Schedule
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73
Perform
Integrated
Change control
Monitor & Control
Project Work
Planning
processes
Executing
processes
Closing
processes
Perform quality control
Control Schedule
Control Costs
Report Performance
Monitor & Control Risks
Administer Procurements
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Monitor and Control Project Work
The process of:
Tracking, reviewing, and regulating the
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75
Tracking, reviewing, and regulating the
progress to meet the project objectives
defined in the project management plan.
What is the meaning of Monitoring?
Monitoring means:
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76
1. Collecting, measuring, and distributing
performance information.
2. Assessing measurements and trends
to effect process improvements!
Please remember!
Monitoring:
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77
Monitoring:
3. Is done throughout the project.
4. Continuous monitoring gives the project
management team an insight into the
health of the project, and IDENTIFIES
AREAS THAT MAY REQUIRE SPECIAL
ATTENTION!
What is the meaning of Controlling?
Controlling means:
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78
Controlling means:
1. Determining corrective or preventive
actions or
2. Replanning, and
3. Following up on action plans
TO DETERMINE IF THE ACTIONS TAKEN
RESOLVED THE PERFORMANCE ISSUE!
How do we do it?
Most basic:
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79
1. Comparing actual project performance against
the project management plan!
2. We assess performance to determine whether
any corrective and preventive actions are
indicated. If so, then we recommend them to
ICC for approval.
How do we do it?
Most basic:
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80
3. We analyze, track, monitor project risks to
ensure the risks are identified, their status is
reported, and appropriate response plans are
executed.
4. We maintain accurate and timely information
base about projects product and related
documentation through project completion.
How do we do it?
Most basic:
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81
5. We provide information to support STATUS
REPORTING,PROGRESS MEASUREMENT,
FORECASTING!
6. We provide forecasts to update current
schedule and cost information.
7. We monitor implementation of approved
changes.
Monitor and Control Project Work process overview
INPUTS
TOOLS &
OUTPUTS
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Project Management
Plan
Performance reports
Enterprise
environmental
factors
Organizational
process assets
INPUTS
TOOLS &
TECHNIQUES
Expert Judgment
OUTPUTS
Change requests
Project management
plan updates
Project document
updates
Monitor and Control Project Work process: INPUTS
Project Management Plan provides baselines for
measuring performance.
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Performance reports provide actual work
performance information.Reports prepared by the
project team detailing activities, accomplishments,
Milestones, identified issues, and problems.
Example
Performance reports provide key information.
Examples:
- Current status
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84
- Current status
- Significant accomplishments for the period
- Scheduled activities
- Forecasts, and
- Issues.
Enterprise environmental factors that can
influence this process:
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85
1. PMIS used for variance analysis and evaluation
of impact on the project.
2. Stakeholder risk tolerances
3. Company work authorization systems
4. Government or industry standards (regulatory
agency regulations, product standards, quality
standards, and workmanship standards).
Organizational process assets that can
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86
1. Issue and risk management procedures,
2. Financial control procedures (time reporting,
accounting codes, expenditure and
disbursement reviews, and standard contract
provisions),
3. Organization communication requirements,
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87
4. Risk control procedures (risk categories,
probability definition and impact, and probability
and impact matrix), Issue and risk management
procedures,
5. Process measurement database (used to make
available measurement data on processes and
products, and
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5. Process measurement database (used to make
available measurement data on processes and
products, and
6. Lessons learned database.
Monitor and Control Project Work process:
Expert judgment
The project management team uses expert
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89
The project management team uses expert
judgment to interpret the information provided by
the monitor and control process.
The project manager, along with the team,
determines the actions required to ensure project
performance matches with the expectations
detailed in the project management plan.
Please remember
Although not mentioned specifically, we use here
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90
Although not mentioned specifically, we use here
all the performance measurement, forecasting,
And change control tools and techniques,
including PMIS.
OUTPUTS
1. Change requests
Variance Measurements resulting from this
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91
process may lead to following change requests:
a) Corrective action to bring expected future
performance in line with project management
plan).
b) Preventive action to reduce the probability of
negative consequences associated with project
risks.
OUTPUTS
1. Change requests
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process may lead to following change requests:
c) Defect repair Corrective action to either
repair the defect in a project component or
completely replace it.
Change requests are sent to ICC for review and
approval.
OUTPUTS
Change requests are sent to ICC for review and
approval. Without review and approval of ICC, no
change request can be implemented.
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93
change request can be implemented.
Change requests, if approved, may:
- Expand, adjust project or product scope,
- Revise project management plan,
- Revise project documents, or
- Revise product deliverables.
OUTPUTS
2. Project management plan updates
Revision of following may happen:
- Baselines
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- Baselines
(Scope baseline, schedule baseline, cost
performance baseline).
- Subsidiary plans
(such as schedule management plan, cost
management plan, quality management plan).
OUTPUTS
3. Project document updates
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- Forecasts
- Performance reports
- Issue log
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PERFORM INTEGRATED CHANGE CONTROL
Perform Integrated Change Control
Process of
Reviewing all change requests, approving
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Reviewing all change requests, approving
changes and managing changes to the
deliverables, project management plan, project
documents and the organizational process
assets.
Please remember
PERFORM INTEGRATED CHANGE
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98
PERFORM INTEGRATED CHANGE
CONTROL PROCESS IS CONDUCTED FROM
PROJECT INCEPTION THROUGH
COMPLETION.
During planning also, all updates, refining, maturing of
the project management plan and other project
documents happens only after the information is
reviewed and allowed for inclusion.
Please remember
One of the major job of this process is to
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99
One of the major job of this process is to
carefully and continuously manage changes
and permit only approved changes to revise
a baseline.
This is the only way to maintain the project
management plan, the project scope statement,
and other deliverables!
How do we do it?
1. Reviewing, analyzing, and approving change
request PROMPTLY. A slow decision may
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request PROMPTLY. A slow decision may
negatively affect time, cost or the feasibility of
a change! A quick approval or denial of all
recommended corrective or preventive actions
or any other type of request is necessary.
How do we do it?
2. Maintaining the integrity of baselines by
releasing only approved changes for
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releasing only approved changes for
incorporation into the project management
plan and project documents.
3. Coordinating changes across the entire project.
example: a proposed schedule change will
often affect cost, risk, quality, and staffing.
How do we do it?
4. Documenting the complete impact of change
requests.
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requests.
5. Influencing the factors that circumvent
integrated change control so that only
approved changes are implemented.
Please remember
Changes may be requested by any stakeholder.
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03
Although they may be initiated verbally, but they
must always be recorded in written form and
entered into the change management or
configuration management system!
The cost and time impacts must be understood.
Please remember
Every documented change request must be
either approved or rejected by some authority
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either approved or rejected by some authority
within the project management team or an
external organization.
On some projects, the project manager may be
given authority to approve certain types of
changes! And this would be mentioned in the
roles and responsibilities document.
Please remember
The Perform Change Control process may
include a Change Control Board (CCB). Then,
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include a Change Control Board (CCB). Then,
CCB will approve or reject change requests.
The roles and responsibilities of CCBs are
defined in Configuration Control and Change
Control Procedures with due consent of
appropriate stakeholders. Large organizations
have multi-tier board structure!
THE NEED FOR A
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THE NEED FOR A
CONFIGURATION MANAGEMENT
SYSTEM
A configuration management system with
integrated change control provides
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07
integrated change control provides
a standardized, effective, and efficient way
to centrally manage approved changes and
baselines within a project!
QUESTION
What is the difference between configuration
control and change control?
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control and change control?
ANSWER
Configuration control is focused on the specification of
both the deliverables and the processes.
Change control is focused on identifying,
documenting and controlling changes to the project
and the product baselines.
Project-wide application of configuration
Objectives accomplished?
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Project-wide application of configuration
management systems, including change
control processes, accomplishes three
main objectives
1) Establishes an evolutionary method to
consistently identify and request changes to
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consistently identify and request changes to
established baseline!
2) Provides opportunities to continuously validate
and improve the project by considering impact of
change!
3) Provides the mechanism for the project
management team to consistently communicate
all changes to the stakeholders!
THREE Key configuration management activities:
1. Configuration identification
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11
1. Configuration identification
2. Configuration status accounting
3. Configuration verification and audit
Integrated Change Control
What Configuration Management Activities
are included in Integrated Change Control?
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12
Provides basis from which
1) the configuration of
products is defined and verified
2) Products and documents are
labeled
3) Changes are managed and
accountability is maintained
Configuration
Identification
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13
Capturing, storing, and assessing
configuration information required
to manage products and product
information effectively.
Configuration
Status
Accounting
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14
Establishes that the performance
and functional requirements
defined in the configuration
management have been met.
Configuration
Verification &
Auditing
Perform Integrated Change Control process overview
INPUTS
TOOLS &
OUTPUTS
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Project Management
Plan
Work Performance
Information
Change requests
Enterprise
Environmental
Factors
Organizational
Process Assets
INPUTS
TOOLS &
TECHNIQUES
Expert judgment
Change control
Meetings
OUTPUTS
Change requests
Status Updates
Project management
plan UPDATES
Project document
UPDATES
Perform Integrated Change Control process inputs
Used in this process. We have talked about it
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16
in detail.
Work performance information
in detail.
Perform Integrated Change Control process inputs
Change requests
- Recommended corrective action
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17
- Recommended corrective action
- Recommended preventive action
- Recommended defect repair
- Any other type of change request regarding
scope, time, cost, quality addition or
deletion.
All monitoring and controlling processes and many of
executing processes produce change requests!
Please remember
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CORRECTIVE AND PREVETIVE ACTIONS
DO NOT NORMALLY AFFECT THE
BASELINES, ONLY THE PERFORMNCE
AGAINST THE BASELINES!!
Perform Integrated Change Control inputs
Enterprise environmental factors provide
PMIS
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PMIS
An automated system used by the project
management team as an aid for implementing
an Integrated Change
Control Process for the project.
- Also facilitates FEEDBACK for the project
- Controls changes across the project.
Perform Integrated Change Control inputs
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- Change control procedures
- Procedures for approving and issuing change
authorizations
- Process measurement database
(measurement data on processes and products)
- Project files
- Configuration management knowledgebase
Perform Integrated Change Control tools and techniques
Expert judgment
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In addition to the project management teams
expert judgment, stakeholders may be
requested to provide advantage of their
expertise. They may be invited by the CCB.
Such expert judgment is applied to any technical
and management aspect during this process.
Expert judgment
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CCB can use expertise from various sources:
- Subject matter experts
- Project Management Office
- Stakeholders (including customers or sponsors)
- Consultants
- Professional and technical associations
- Industry groups
Change control meetings
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Change control board conducts meetings and
reviews change requests. Then, approves or
rejects the. All CCB decisions are recorded and
communicated to the stakeholders for
information and follow-up actions.
Perform Integrated Change Control process
OUTPUTS
Change Requests Status Updates
Change requests are processed according to the
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24
Change requests are processed according to the
change control system by the project manager or
assigned team member.
Approved change requests are implemented by
the Direct and Manage Project Execution
process.
Status of all changes, approved or not, put in the Change
Request Log.
OUTPUTS
Project Management Plan Updates
- Baselines are updated
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- Baselines are updated
- Subsidiary Management Plans updated
Please note: Changes to the baselines must only
show the CHANGES FROM THE CURRENT
TIME FORWARD. Past performance may not be
changed! This protects the integrity of the
baselines and the data of past performance!
OUTPUTS
- Change Request Log
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- Change Request Log
- Any other project document (as applicable)
Verify SCOPE
PURPOSE:
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PURPOSE:
To obtain stakeholders formal acceptance of the
completed project scope and associated deliverables!
HOW IS IT DONE?
By verifying the project scope and reviewing deliverables
to make sure each is completed satisfactorily!
Please remember!
Verify SCOPE
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Please remember!
IF PROJECT IS TERMINATED EARLY, SCOPE
VERIFICATION MUST BE DONE TO ESTABLISH THE
LEVEL AND EXTENT OF COMPLETION!
WHAT IS THE DIFFERENCE BETWEEN SCOPE
Verify SCOPE
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WHAT IS THE DIFFERENCE BETWEEN SCOPE
VERIFICATION AND QUALITY CONTROL?
SCOPE VERIFICATION IS PRIMARILY CONCERNED
WITH ACCEPTANCE OF DELIVERABLES!
QUALITY CONTROL IS PRIMARILY CONCERNED
WITH QUALITY REQUIREMENTS FOR THESE
DELIVERABLES!
WHEN IS QUALITY CONTROL PERFORMED?
Verify SCOPE
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WHEN IS QUALITY CONTROL PERFORMED?
Generally before SCOPE VERIFICATION.
But these two can be performed parallel also.
Verify Scope process overview
INPUTS
TOOLS &
TECHNIQUES
OUTPUTS
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Project management
plan
Requirements
documentation
Requirements
Traceability Matrix
Validated Deliverables
INPUTS
TECHNIQUES
Inspection
Reviews
Product reviews
Audits
Walkthroughs
OUTPUTS
Accepted deliverables
Change requests
Project documentation
updates
Verify Scope
Provides scope baseline:
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Provides scope baseline:
1. Project scope statement for product
scope description, product
deliverables, product user acceptance
criteria.
2. WBS defines each deliverable and its
decomposition into work packages.
3. WBS dictionary for detailed technical
description for each WBS element.
Verify Scope- Inputs
Requirements documentation Provides:
All the project, product, technical and other types of
requirements that must be present in the deliverables
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requirements that must be present in the deliverables
along with their acceptance criteria.
Requirements traceability matrix Links:
Requirements to their origin and tracks them
throughout the project life cycle.
Validated deliverables
All those deliverables that are duly checked by QC and
offered for inspection for formal acceptance.
Verify Scope
Inspection
Includes measuring,
TOOLS &
TECHNIQUES
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Includes measuring,
examining, and verifying to
determine whether work and
deliverables meets
requirements and product
acceptance criteria!
Termed as reviews, product
reviews, audits, and
walkthroughs. Remember this!
TECHNIQUES
Inspection
Reviews
Product reviews
Audits
Walkthroughs
Verify Scope
Accepted deliverables
Those completed deliverables
OUTPUTS
Accepted
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Those completed deliverables
that have been accepted!
Completed deliverables that
are not accepted are recorded
with reasons for non-
acceptance.
All supporting documents from
customer or sponsor are
maintained.
Accepted
deliverables
Change Requests
Project document
updates
Change Requests
Change requests may result
Verify Scope
OUTPUTS
Accepted
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Change requests may result
from this process for
deliverables not accepted and
require defect repair!
Processed for review and
approval through Perform
process.
Accepted
deliverables
Change Requests
Project document
updates
Project document
updates
Verify Scope
OUTPUTS
Accepted
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updates
Any document that define
the product or report status
on product completion may
require updating as a result
of this process!
Accepted
deliverables
Change Requests
Project document
updates
Control SCOPE
Involves:
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Involves:
1) Influencing factors that create scope changes
2) Control impact of those changes
3) To ensure that only approved changes are
implemented by sending requested changes and
recommended corrective actions to ICC.
4) To manage actual scope changes when they happen
and integrate them with other control processes
Uncontrolled changes are called scope creep!
Control Scope process overview
INPUTS
TOOLS &
TECHNIQUES
OUTPUTS
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Project management
plan
Work performance
information
Requirements
documentation
Requirements
traceability matrix
assets
INPUTS
TECHNIQUES
Variance analysis
OUTPUTS
Work performance
measurements
OPAs updates
Change requests
PM plan updates
Project document
updates
Control Scope- Inputs
Includes information that is used:
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Includes information that is used:
Scope baseline: compared to actual results to decide
if a change, corrective action, or preventive action is
required!
Scope management plan (describes how project scope
will be managed and controlled)
Change management plan for handling changes
Configuration management plan defines-
1) items that are configurable
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1) items that are configurable
2) items that require formal change control
3) process to control changes to such items
Requirements management plan includes:
a) how requirements activities will be planned, tracked
and informed
b) how changes to requirements will be initiated
c) how impacts will be analyzed
d) authorization level for approving these changes
Which deliverables have started, their progress
Which deliverables have finished
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Which deliverables have finished
Requirements documentation
To check accomplishment of requirements
Requirements traceability matrix
To trace requirements to their origin
OPAs
Scope control policies, procedures
Monitoring and reporting methods
Control Scope
Variance analysis(comparing
actual with what is planned)
Assesses magnitude of variation
TOOLS &
TECHNIQUES
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Assesses magnitude of variation
Determines cause of variance
from scope baseline.
Decides if corrective or preventive
action is required.
Variance
analysis
Control Scope
Work performance
measurements
Planned vs. Actual technical
OUTPUTS
Work performance
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Planned vs. Actual technical
performance, or other scope
performance measurements!
Also informed to stakeholders!
Work performance
measurements
OPAs updates
PM Plan updates
Change requests
Project document
updates
OPAs updates
Lessons learned are posted in the organizations
Lessons Learned database:
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Lessons Learned database:
1) causes of scope variances,
2) logic behind action chosen, and
3) other types of lessons learned.
This provides help to Current projects as well as Future
projects! One can just access this database from OPAs!
Change Requests
Analysis of scope performance can result in a
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change request to scope baseline or other
components of project management plan.
Examples: Corrective action or preventive
action or defect repair.
Change requests are sent to ICC for approval.
Project management plan updates
1. Scope baseline updates
2. Other baseline updates
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2. Other baseline updates
If approved change request have an effect on
project scope, then scope statement, WBS, and
WBS dictionary are revised and reissued to show
the approved changes.Corresponding cost
baseline and schedule baseline are also revised and
reissued to reflect the approved changes.
Scope changes result in
corresponding updates to:
Project
Document
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corresponding updates to:
2) Requirements traceability
matrix.
updates
CONTROL SCHEDULE
Involves:
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Involves:
1) Influencing factors that create schedule changes
2) Control impact of those changes
3) To ensure that only approved changes are
implemented by sending requested changes and
recommended corrective actions to ICC.
4) To manage actual schedule changes when they
happen and integrate them with other control
processes
Control Schedule process overview
Project
INPUTS
TOOLS &
TECHNIQUES
OUTPUTS
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Project
management plan
Project Schedule
Work Performance
information
Assets
TECHNIQUES
Performance
Reviews
Resource Leveling
Schedule
Compression
Project
management
software
Variance analysis
Schedule Tool
Work Performance
measurements
Change requests
OPAs updates
Project Management
plan updates
Project documents
updates
Control Schedule process INPUTS
Project management plan provides
1. Schedule baseline
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* Actual results are compared with schedule
baseline to determine if a change, corrective
or preventive action is necessary.
* Schedule management plan tells how the
schedule will be managed and controlled.
Project schedule provides
the most current version of the project
schedule with notations to show updates,
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schedule with notations to show updates,
completed activities, and started activities as
of indicated data date!
Work Performance Information
provides information on project progress
Which activities have started, their progress,
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Which activities have started, their progress,
and which activities have finished.
- Schedule control policies, procedures
- Schedule control tools
- Monitoring and reporting methods to be
used.
Control Schedule process TECHNIQUES
Performance reviews
Variance analysis
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Resource leveling
Adjusting leads and lags
Scheduling tool
Performance reviews
Variance analysis
Project management
Performance reviews
Measure, compare, and
analyze schedule performance
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Project management
software
Resource leveling
What-if scenario
analysis
Adjusting leads and
lags
Scheduling tool
analyze schedule performance
such as actual start and finish
dates, percent complete, and
remaining duration for work in
progress.
If we use EVM, then SV and
SPI provide magnitude of
variance.
Performance reviews
Variance analysis
Project management
Performance reviews
If we use Critical chain
scheduling method, then we
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Project management
software
Resource leveling
What-if scenario
analysis
Adjusting leads and
lags
Scheduling tool
scheduling method, then we
compare the amount of buffer
remaining to the amount of
buffer needed to protect the
delivery date.
Buffer variance can decide
whether corrective action
required or not.
Performance reviews
Variance analysis
Project management
Variance analysis
SV and SPI help us to know
magnitude of variance. Total
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Project management
software
Resource leveling
What-if scenario
analysis
Adjusting leads and
lags
Scheduling tool
magnitude of variance. Total
float variance also gives an
idea of time performance.
We then find causes of
variances and necessary
corrective or preventive action.
Performance reviews
Variance analysis
Project management
PM Software
Provides ability to track planned
dates versus actual dates, and
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Project management
software
Resource leveling
What-if scenario
analysis
Adjusting leads and
lags
Scheduling tool
dates versus actual dates, and
to forecast the effects of
changes to the project
schedule.
Resource leveling
Used to optimize distribution of
work among resources. We
have talked about it.
Performance reviews
Variance analysis
Project management
Used to review various
scenarios to bring the schedule
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Project management
software
Resource leveling
What-if scenario
analysis
Adjusting leads and
lags
Scheduling tool
scenarios to bring the schedule
into alignment with the plan.
We have talked about this.
Adjusting leads and lags
Used to find ways to bring
project activities that are behind
into alignment with the plan
Performance reviews
Variance analysis
Project management
Used to find ways to bring
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Project management
software
Resource leveling
What-if scenario
analysis
Adjusting leads and
lags
Schedule
compression
Scheduling tool
into alignment with the plan.
1. Crashing
2. Fast tracking
We have talked about them.
Performance reviews
Variance analysis
Project management
Scheduling tool
Schedule data is updated and
compiled into the schedule
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Project management
software
Resource leveling
What-if scenario
analysis
Adjusting leads and
lags
Scheduling tool
compiled into the schedule
to reflect actual progress of the
project and remaining work.
Scheduling tool and supporting
data are used (in conjunction
with manual methods or other
PM Software) to perform
network analysis and generate
and updated schedule.
Control Schedule process OUTPUTS
OUTPUTS
Work
performance
Work performance
measurements
The calculated SV and SPI values
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performance
measurements
Organizational
process asset
updates
Change requests
Project
management
plan updates
Project document
updates
The calculated SV and SPI values
For WBS components, specially the
Work Packages and Control
Accounts, are documented and
communicated to the stakeholders!
OUTPUTS
Work
performance
assets updates
With the entry of Lessons Learned:
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performance
measurements
Organizational
process asset
updates
Change requests
Project
management
plan updates
Project document
updates
With the entry of Lessons Learned:
1. Causes of variances
2. Corrective action chosen and
reason
3. Other types of lessons learned.
The calculated SV and SPI
values
OUTPUTS
Work performance
measurements
Change requests
Schedule variance analysis, review
of progress reports, results of
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measurements
Organizational
process asset
updates
Change requests
Project
management plan
updates
Project document
updates
of progress reports, results of
performance measures, and
modifications to the project
schedule can result into change
requests to schedule baseline and
other components of the project
plan!! Recommended to ICC for
approval!
OUTPUTS
Work performance
measurements
Updates after ICC approves
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measurements
Organizational
process asset
updates
Change requests
Project
management plan
updates
Project document
updates
3. Cost baseline
OUTPUTS
Work performance
measurements
Schedule baseline- changes to
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measurements
Organizational
process asset
updates
Change requests
Project
management plan
updates
Project document
updates
Schedule baseline- changes to
the schedule baseline are
incorporated IN RESPONSE TO
Approved Changes related to:
a) Project scope changes
b) Activity durations
c) Activity resources
OUTPUTS
Work performance
measurements
Schedule management plan-
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measurements
Organizational
process asset
updates
Change requests
Project
management plan
updates
Project document
updates
Schedule management plan-
May be updated to reflect a
change in the way the schedule is
managed!
Cost baseline-
The cost baseline may be
Updated to reflect changes
caused by compression or
Crashing techniques!
OUTPUTS
Work performance
measurements
Project document Updates
1. Schedule data
2. Project schedule
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measurements
Organizational
process asset
updates
Change requests
Project
management plan
updates
Project document
updates
2. Project schedule
Schedule data update:
New network diagrams may be
developed to display approved
remaining durations and
modifications to the work plan.
OUTPUTS
Work performance
measurements
Please remember
In some cases, project
schedule delays can be so
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measurements
Organizational
process asset
updates
Change requests
Project
management plan
updates
Project document
updates
schedule delays can be so
severe that development of a
new target schedule with
forecasted start and finish
dates is needed to provide
realistic data for directing the
work, and for measuring
performance and progress!!!
OUTPUTS
Work performance
measurements
Project document Updates
1. Schedule data
2. Project schedule
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measurements
Organizational
process asset
updates
Change requests
Project
management plan
updates
Project document
updates
2. Project schedule
Project schedule update:
An updated project schedule
will be generated from the
updated schedule data to
reflect the schedule changes
and manage the project.
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CONTROL COST
CONTROL COST
COST CONTROL
THE CONCEPT
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THE CONCEPT
Cost control tracks expenditures versus budget to detect
variances.
It seeks to eliminate unauthorized or inappropriate
expenditures, and to minimize or contain cost changes.
It identifies WHY variances occur, WHERE changes to
cost baselines are necessary, and WHAT cost changes
are reflected in the budgets and cost baselines.
THE CONCEPT
COST CONTROL
CONTROL COST
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THE CONCEPT
Periodically, the project manager reviews actual and
budgeted costs, and compares costs to assessments of
the work completed, and prepares estimates of the
completion cost and completion date of the project.
It is accomplished both at work package level and the
project level using the cost account structure.
THE CONCEPT
COST CONTROL
CONTROL COSTS
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THE CONCEPT
So, the key to cost control is to:
Detect and understand variances from the plan by
monitoring cost performance
Prevent inappropriate, unauthorized, and incorrect
modifications from inclusion in the cost baseline
THE CONCEPT
CONTROL COST
CONTROL COST
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THE CONCEPT
Take action to get expected costs within
acceptable range
Report approved changes to the concerned
stakeholders
Search out REASONS for positive as well as
negative variances
THE CONCEPT
CONTROL COST
CONTROL COST
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THE CONCEPT
Thoroughly integrate cost control with other control
processes as we have discussed during integrated
change control:
Scope change control
Schedule control
Quality control, and
Others
THE CONCEPT
CONTROL COST
CONTROL COST
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THE CONCEPT
Remember improper responses to
cost variances may lead to
schedule or quality issues
THE CONCEPT
CONTROL COSTS
CONTROL
COSTS
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THE CONCEPT
Remember improper responses to cost variances
may lead to:
Schedule problems or
Quality problems or
An unacceptable risk-level in future in the
project
CONTROL COSTS
HENCE, COST CONTROL PROCESS CONSISTS OF:
CONTROL COSTS
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HENCE, COST CONTROL PROCESS CONSISTS OF:
1) Impacting the factors that lead to schedule changes so
that these changes are agreed upon.
2) Ascertaining that the schedule has changed.
3) Dealing with the actual changes as they
happen.
Control Costs process overview
INPUTS
TOOLS &
TECHNIQUES
OUTPUTS
CONTROL COSTS
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80
Project management
plan
Project funding
requirements
Work performance
information
assets
INPUTS
TECHNIQUES
Earned Value
Management
Forecasting
To Complete
Performance Index
(TCPI)
Performance
reviews
Variance analysis
Project
management
Software
OUTPUTS
Work Performance
measurements
Budget Forecasts
Change Requests
Recommended
corrective actions
OPAs Updates
PM Plan Updates
- cost baseline
- cost management plan
CONTROL COSTS
Project management
plan
Project funding
INPUTS
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81
- cost management plan
Cost baseline is Used for
comparing actual expenditure with
planned expenditure as mentioned
in the cost baseline.
Cost management plan tells how
project cost will be managed and
controlled!
Project funding
requirements
Work performance
information
assets
Project Funding requirements
Are used as input here.
CONTROL COSTS
Project management
plan
Project funding
INPUTS
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82
Used for comparing actual
expenditure with planned
expenditure as mentioned in the
cost baseline.
Project funding
requirements
Work performance
information
assets
Costs incurred. Also tells which
CONTROL COSTS
Project management
plan
Project funding
INPUTS
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83
Costs incurred. Also tells which
deliverables completed, work-in
Progress
1) Deliverables completed and yet to
be completed
2) Costs actually spent
3) Estimate to complete balance work
4) Percentage physically complete of
schedule activities.
Project funding
requirements
Work performance
information
assets
- Cost-related policies,
CONTROL COSTS
Project management
plan
Project funding
INPUTS
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84
- Cost-related policies,
procedures, guidelines
- Cost control tools
- Monitoring and reporting
methods to be used.
Project funding
requirements
Work performance
information
assets
Sample Change Control System
CONTROL COSTS
FLOW DIAGRAM OF COST CHANGE SYSTEM
(Tracks and Documents Cost Change Issues)
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85
Cost
Change
Request
Cost
Change
Tracking
system
Has Cost
Change
Already
Taken
place?
DOCUMENTATION
1) Cause
2) Cost
3) Parties involved
4) Decision
Cost
Change
Approved?
YES
NO
YES
NO
Earned Value Management
Integrates scope, time and cost
CONTROL COSTS
TOOLS &
TECHNIQUES
Earned Value
Management
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86
Integrates scope, time and cost
measures to help assess and
measure project performance and
progress! Requires formation of
an integrated baseline!
Measures three dimensions for
each work package and control
account.
Management
Forecasting
To Complete
Performance Index
(TCPI)
Performance
reviews
Variance analysis
Project
management
Software
1) Earned value management
Earned Value Concept
Costs are budgeted period-by-period for each work
CONTROL COSTS
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87
Costs are budgeted period-by-period for each work
package or cost account (time-phased budgeting).
Once project begins, work progress and actual costs
are tracked every period and compared to these
budgeted costs.
We measure and track work progress using the
concept of earned value.
The earned value of work completed in a project is
CONTROL COSTS
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88
The earned value of work completed in a project is
determined by the combined status of all work
packages at a given time.
Computed by taking:
1) The sum of the budgeted costs of all work
packages thus far completed
PLUS
2) The sum of earned value of all open work packages
example
Say as of August 25, work packages A, B, C
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89
Say as of August 25, work packages A, B, C
had been completed and they were
budgeted to cost Rs. 30 K, Rs. 15 K, and 10
K respectively. Work package D budgeted to
cost Rs. 40 K was only 75% complete.
Then, THE EARNED VALUE for the project
as of August 25:
Rs. 30 K + Rs. 15 K + Rs. 10 K + (0.75) Rs. 40 K =
Rs. 85 K
Earned value management
Do you know the purpose of EVM Control Account
Plans (CAPs)?
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90
Plans (CAPs)?
Well, all these CAPs continuously measure project
performance.
HOW?
By relating to three independent variables (we have
discussed them and refresh again)
Planned value (PV), Earned value (EV), and Actual
value (AC)
Planned value (PV)
The sum cost of all work, plus apportioned effort,
Control Costs
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91
The sum cost of all work, plus apportioned effort,
scheduled to be completed within a given time period
as specified in the original budget. Earlier name
BCWS (budgeted cost of work performed)
EXAMPLE: (discussed during Performance Reporting
process)
In Essar Cargo Project in week 20 to date:
Cumulative PV = Rs. 512,000
Weekly PV = Rs. 83,000
Earned value (EV)
Is the budgeted value of the work actually completed
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92
Is the budgeted value of the work actually completed
as on the date of measurement . Earlier name BCWP
(budgeted cost of work performed)
EXAMPLE
In Essar Cargo Project in week 20:
Cumulative EV is Rs. 429,000
Actual costs (AC)
The total of costs incurred in accomplishing work
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93
The total of costs incurred in accomplishing work
during a given time period. It is the sum of the costs
for all completed work packages plus all open work
packages and overhead.
Earlier known as ACWP (actual cost of work
performed)
Example
In Essar Cargo Project, as of week 20:
AC is Rs. 530,000
Essar Cargo Project: Performance Report Week 20 (cumulative to date)
REAL LIFE
EXAMPLE
CPI SPI SV CV
EV AC PV
ACTIVITY
H 100 100 100 0 0 1.00 1.00
Tabular form
(Rs. 1000 s) (Rs. 1000 s) (Rs. 1000 s)
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94
J
K
L
M
N
O
P
Q
I 64
96
16
36
84
40
20
24
32
512 PROJECT
70
97
12
30
110
45
28
22
16
530
64
96
14
18
33
40
24
24
16
429
0
0
- 2
- 18
- 51
0
4
0
- 16
- 83
- 6
- 1
2
- 12
- 77
- 5
- 4
2
0
- 101
1.00
1.00
0.88
0.50
0.39
1.00
1.20
1.00
0.50
0.84
0.91
0.99
1.17
0.60
0.30
0.89
0.86
1.09
1.00
0.81
EVM in action
Schedule Variance (SV)
SV = EV PV
At project level,
Week 20:
PV = INR 512 K
EV = INR 429 K
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95
= 429 K 512 K
= - 83 K
We are behind schedule as of
week 20
Cost Variance (CV )
CV = EV AC
= 429 K 530 K
= - 101 K
We have spent more than
budgeted for the work done
as of week 20
Project
Performance
(Essar Cargo Project)
EV = INR 429 K
AC = INR 530 K
EVM in action
For knowing the status of the project,
we need to have information on the
Work package
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96
we need to have information on the
performance for all work packages and
participating functional areas.
In Essar Cargo Project as of week 20:
1) Work packages H, I, J have been
completed and are closed accounts
2) Work packages K through Q are
open and in progress
Work package
Analysis
and
Performance
Indices
EVM in action
Two types of indices are used to asses
the schedule and cost performance of
Work package
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97
the schedule and cost performance of
the work packages and the relative size
of the problem areas:
Schedule Performance Index (SPI)
SPI = EV / PV
Cost Performance Index (CPI)
CPI = EV / AC
Work package
Analysis
and
Performance
Indices
EVM in action
YARD STICK
Values of SPI and CPI
Work package
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98
Values of SPI and CPI
1) Greater than 1.0 indicate the work is ahead
of schedule and under-budget
2) Lesser than 1.0 shows the work is behind
schedule and over-budget
SPI and CPI highlight trouble spots and their
Relative Magnitude!
Example: Essar Cargo Project, week 20
1) Work packages L, M, and Q have fallen the
most behind schedule (have smallest SPI)
Work package
Analysis
and
Performance
Indices
EVM in action
2) L and M had the greatest cost overruns
relative to their size (they have smallest
At project level,
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99
CPI)
The overall project is behind schedule
and over cost:
At project level,
Week 20:
PV = Rs. 512 K
EV = Rs. 429 K
AC = Rs. 530 K
Schedule Performance Index (SPI)
SPI = EV / PV = 429 K / 512 K = 0.84
Cost Performance Index (CPI)
CPI = EV / AC = 429 K / 530 K = 0.81
Essar Cargo Project
EVM in action
Focusing on only the project level or
Work package
15
00
only the work package level to
determine project status can be
misleading!
If the project manager looks only at the
project level, good performance of some
activities will overshadow and hide poor
performance in others!!
If the project manager focuses only on
individual work packages, the
cumulative effect from slightly
Work package
Analysis
and
Performance
Indices
EVM in action
poor performance on many activities
Work package
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01
can easily be overlooked
Even small cost overruns on many
individual work packages can add up to
large overruns for the project!!!
LESSON LEARNED?
THE PROJECT MANAGER MUST
SCAN BOTH PROJECT LEVEL AND
WORK PACKAGE LEVEL, BACK
AND FORTH
Work package
Analysis
and
Performance
Indices
example
Project Status as of week 20
500
550
450
SV
CV
AV
PV
C
o
s
t

R
s
.

1
0
0
0

s
15
02
Week
50
0
0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20
450
400
350
300
150
100
250
200
PV
AC
EV
Status Date
C
o
s
t

R
s
.

1
0
0
0

s
TV
Project level analysis
says that the project is
about 1 week behind
schedule.
BUT
Project Status as of week 20
BUT
But work package level analysis tells that one of the
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03
But work package level analysis tells that one of the
Work packages (M) is behind Schedule. It is on critical
path and appear to be 3 week behind schedule, hence
project should also be 3 weeks behind, not 1 Week as
shown by project level analysis.
Example: Gantt chart
Gantt Chart: Work Status as of week 20
Basic design H
Hardware design A I
Hardware design B J
Drawings B K
Software specs L
M is on critical path,
And behind schedule
15
04
Week
0 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 32 34 36.48
Software specs L
Parts purchasing B M
Parts purchasing A N
Drawings A O
Installation drawings P
Software purchasing Q
Delivery B R
Delivery A S
Software delivery T
Assembly A U
Assembly B V
Test A W
Test B X
Final installation Y
Final test Z
Completed work
Pending work
EVM in action
The greatest problem: How to predict percentage complete?
Solutions:
1) 50/50 Rule (most common)
Half budget of each element is booked at the time the work is
Resolving problems in calculating EV
15
05
Half budget of each element is booked at the time the work is
scheduled to start and other half when it is scheduled to finish.
Advantage: eliminates the necessity for continuous determination
of percentage complete.
2) 100 percent Rule
a) Used when work or materials will be planned and earned
ON RECEIPT than usage, or
b) when the start and finish of the efforts happens in a time span
short enough to justify use of 50/50 rule
3) N percent completion Rule
Used when we can identify meaningful criteria for reporting on
work packages spanning several months
2) Forecasting
As the project progresses, the project team can
develop a forecast for the estimate at completion
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06
develop a forecast for the estimate at completion
(EAC). This may differ from budget at completion
(BAC).
The project manager develops forecasted EAC if
BAC is no longer viable.
Forecasting
EAC is a prediction of conditions and events in
future based on knowledge at the time of
15
07
future based on knowledge at the time of
forecast.
Forecasts are generated, updated, and re-issued
based on work performance information.
Calculating EAC
Actual cost for work completed plus a new estimate to
complete remaining work. EVM work well in
15
08
complete remaining work. EVM work well in
conjunction with manual forecasts of required EAC
costs, most common, Bottom-up summation.
But one has to stop work to do it and there is no
separate budget or time included for this. Additional
costs are incurred if you do so.
Equation, EAC = AC + bottom-up ETC
Forecasting (EVM in action)
ORIGINAL
PLAN
BAC
PV
TODAY
15
09
PLAN
BAC
EAC
ETC
PV
AC
BAC = BUDGET AT COMPLETION
(budget for the total project)
ETC = ESTMATE TO COMPLETE
(how much more balance it will
cost to complete balance project
work?)
EAC = ESTMATE AT COMPLETION
(what do we currently expect the
total project to cost ? : A VERY
NATURAL CONCERN OF
STAKEHOLDERS)
1. EAC forecast for ETC work performed at budgeted rate
SCENARIO ONE FORMULA
EAC = AC + BAC - EV
15
10
When we find variances till date
will not recur in future and we
complete remaining work at the
budgeted rate.
In such a scenario, we find EAC
by adding Actual Cost to date
(AC) to balance budget
(BAC EV).
EAC = AC + BAC - EV
Example
Say for a project,
AC = Rs. 10 K
BAC = Rs. 150 K,
EV = Rs. 15 K
Then EAC will be
EAC = AC + BAC EV
= Rs.10 K + Rs.150 K 15 K
= Rs. 145 K
1. EAC forecast for ETC work performed at budgeted rate
SCENARIO ONE
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11
CAUTION!
WHEN ACTUAL PERFORMANCE IS
UNFAVOURABLE, THE ASSUMPTION THAT
FUTURE PERFORMNCE WILL IMPROVE
SHOULD BE ACCEPTED ONLY WHEN
SUPPORTED BY PROJECT RISK ANALYSIS!
EAC forecast for ETC work performed at the present CPI
SCENARIO TWO FORMULA
EAC = AC + (BAC EV) / CPI
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12
What project has
experienced to date can
be expected to continue
in future! ETC work
assumed to be
performed at the same
cumulative CPI to date!
EAC = BAC/ cumulative CPI
EAC = AC + (BAC EV) / CPI
Example
Say for a project,
AC = Rs. 10 K
BAC = Rs. 150 K,
EV = Rs. 15 K, CPI = 0.87
Then EAC will be:
AC + BAC EV
Rs.10 K + Rs.150 K 15 K / 0.87
= Rs. 145 K / 0.87
= Rs. 167 K
EAC forecast for ETC work performed at the present CPI
ETC work will be performed at an efficiency rate that
SCENARIO THREE
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13
ETC work will be performed at an efficiency rate that
considers both CPI and SPI.
Assumes a negative cost performance to date and a
requirement to meet a firm Schedule Commitment!
This helps when schedule impacts ETC effort.
Variances of this method weighs CPI and SPI in
different values: 80/20, 50/50, etc., as per project
managers judgment.
EAC = AC + [ (BAC-EV) / (cumulative CPI x Cumulative SPI) ]
ETC AND VAC
ESTIMATE TO COMPLETE (ETC)
15
14
HOW MUCH MORE THE PROJECT WILL COST!
CALCULATION FORMULA: ETC = EAC - AC
VARIANCE AT COMPLETION (VAC)
HOW MUCH MORE THE PROJECT WILL COST!
CALCULATION FORMULA: VAC = BAC - EAC
FORECASTS AS OF WEEK 20
ESSAR CARGO PROJECT
BAC
1200
1100
1000
C
O
S
T

(

R
s
.

1
0
0
0

s
)
Forecast AC EAC
Status Date
ETC = BAC EV / CPI, EAC = AC + ETC
BAC = Rs. 990 K, EV = Rs. 429 K, CPI = 0.81
AC = Rs. 530,000
ETC
15
15
WEEK
BAC
0 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 32 34 36 38 40 42 44 46 48 50 52
900
800
700
600
500
400
300
200
100
C
O
S
T

(

R
s
.

1
0
0
0

s
)
PV
AC
EV
Forecast EV
ETC
Initial
target date
Revised
Completion
date
ETC
990 K 429 K / 0.81
= Rs. 692,593
EAC
530,000 + 692,593
= Rs. 1,222,593
Control Costs process techniques
3) To complete Performance Index (TCPI)
It is the calculated projection of Cost Performance
that must be achieved on the remaining work to meet
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16
that must be achieved on the remaining work to meet
the specified management goal.
TCPI = work remaining / fund remaining
TCPI = (BAC- EV) / (BAC AC)
When BAC no longer viable, the project manager will
make new estimate to complete balance work and
once approved, the project will work to new EAC
value.
4) performance reviews
What do they give us:
1) Compare cost performance over
Control Costs
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17
1) Compare cost performance over
time,
2) Find schedule activities/work
packages overrunning and
underruning budget (PV),
3) Milestones met and due.
These meetings must use one or
more performance-reporting
techniques
performance reviews
performance-reporting techniques to
use:
Control Costs
15
18
use:
1) Variance analysis: comparing
actual with planned. Cost and
schedule variances are often
analyzed but we must variances in
scope, quality, resources, and risk
are also equally or sometimes
more important.
performance reviews
performance-reporting techniques to
use:
Control Costs
15
19
use:
2) Trend analysis: examining project
performance over time to see if
performance is improving or
deteriorating!
3) EV technique: compares actual
performance with planned
performance.
5) Variance Analysis
Cost performance measurements (CV, CPI) are
used to assess the magnitude of variation to the
CONTROL COSTS
15
20
used to assess the magnitude of variation to the
original cost baseline! And then decide if any
corrective or preventive action is needed!
Vital part of cost control lies in:
1) Determining the cause of variance
2) Deciding if the variance warrants corrective
action
example
Example: Variance Analysis
Progress Measurement data date: October 1, 2004
Work
package
Planned
Value
Earned
Value
Actual cost
Work package
Schedule Cost
Status
H COMPLETED 100 100 0 100 0
15
21
H
I
J
K
L
M
O
P
COMPLETED
COMPLETED
COMPLETED
Not started
Not started
COMPLETED
Started
Not started
100
50
40
90
70
50
50
0
450 340
0
50
0
90
0
50
50
100 0
360
0
25
0
140
0
40
55
100
0
- 100
0
- 100
0
0
- 55.5
-------
20
-10
0
- 24.4
-----
- 5.9
-------
-------
50
VAIANCE ANALYSIS RESULTS: AS OF OCTOBER, 2004
THE PROJECT IS BEHIND SCHEDLUE AND OVER BUDGET
5) Variance Analysis
please remember
the percentage range of acceptable variances
CONTROL COSTS
15
22
the percentage range of acceptable variances
tend to decrease as more work is
accomplished. The larger percentage
variances permitted at the start of the project
can decrease as the project nears
completion!
example
6) Project Management Software
Used to monitor three EVM dimensions
CONTROL COSTS
15
23
Used to monitor three EVM dimensions
(PV, EV, and AC) to display graphical
trends and forecast a range of possible
final results!
Cost Costs process Outputs
1) Work Performance
measurements
Calculated
Control Costs
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24
Calculated CV, SV, CPI, SPI
values for WBS components
(work packages or control
accounts).
Are recorded and informed to
stakeholders!
2) Budget Forecast
(EAC, ETC)
Calculated
Control Costs
15
25
Calculated or performing
organization-reported EAC value.
Is recorded and informed to
stakeholders!
Calculated or performing
organization-reported ETC value.
Is recorded and informed to
stakeholders!
3) Change Requests
To some aspect of the project
resulting from project performance
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26
resulting from project performance
analysis.
Example: Increasing or decreasing
the budget!
Routed through ICC.
4) OPAs Updates
Lessons learned posted in database.
Guide us on our current project as well as
Control Costs
15
27
Guide us on our current project as well as
Future ones. Such knowledge management
leads to project management maturity of
the performing organization and also helps
us reinventing the wheel!
Documents from cost control process:
1. Causes of variances,
2. Logic behind the chosen corrective
action, and
3. Other types of lessons learnt from cost
control
5) PM Plan Updates
Components of PM Plan are updated
to reflect changes on account of
Control Costs
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28
to reflect changes on account of
approved change requests of this
process.
Components that often get updated:
1) Cost estimates of Schedule activity,
Work package or Planning package.
2) Cost baseline
6) PM Document Update
include
1) Cost Estimates
Control Costs
15
29
1) Cost Estimates
2) Basis of Estimates
PERFORM QUALITY
15
30
PERFORM QUALITY
CONTROL
PERFORM QUALITY CONTROL
THE CONCEPT
15
31
THE CONCEPT
QUALITY IS THE DEGREE TO WHICH A
SET OF INHERENT CHARACTERISTICS
FULFILL REQUIREMENTS
STATED AND IMPLIED NEEDS ARE THE
INPUTS TO DEVELOPING PROJECT
REQUIREMENTS
THE CONCEPT
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32
THE CONCEPT
A CRITICAL ELEMENT OF QUALITY
MANAGEMENT IN PROJECT CONTEXT IS
TO CONVERT STAKEHOLDER NEEDS,
WANTS, AND EXPECTATIONS INTO
REQUIREMENTS THROUGH
STAKEHOLDER ANALYSIS DURING
PROJECT SCOPE MANAGEMENT
THE CONCEPT
15
33
THE CONCEPT
Quality is synonymous with ability to
conform to the requirements of the end-
item and work processes and procedures.
THE CONCEPT
15
34
THE CONCEPT
Quality control is managing the work to
achieve the desired requirements,
specifications, taking preventive measures
to keep errors and mistakes out of the work
process, and determining and eliminating
the sources of errors and mistakes as they
occur.
THE CONCEPT
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35
THE CONCEPT
Quality management plan plays a vital role as it
describes necessary QUALITY CONDITIONS FOR
EVERY WORK PACKAGE
(prerequisites/stipulations about what must exist
before, during, and after the work package to
ensure quality).
It also specifies the measures and procedures
(tests, reviews, inspections, etc.)
THE CONCEPT
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36
THE CONCEPT
Another important aspect is tracking project
performance with respect to technical
requirements, and modifying the work or the
requirements as necessary.
Variety of methods are used for testing and
inspection to eliminate defects and ensure
that end-items satisfy requirements.
THE CONCEPT
15
37
THE CONCEPT
Tests and inspections must be ongoing so
that problems/defects are identified as early
as possible.
It is less costly to remedy the defects and
problems if they are known early both in the
project management life cycle and product
life cycle.
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38
THE CONCEPT
FUNDAMENTAL PILLARS OF QUALITY
1) Customer Satisfaction
2) Prevention over inspection
3) Management Responsibility
4) Continuous Improvement
FROM OUR DISCUSSION ON THE CONCEPT,
IT IS EVIDENT
THAT QUALITY CONTROL PROCESS
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39
requires us to:
1) Monitor specific project results to
determine whether they comply with
relevant quality standards
2) Identify ways to eliminate causes of
unsatisfactory results
FROM OUR DISCUSSION ON THE CONCEPT,
IT IS EVIDENT
15
40
requires us to:
3) Perform it throughout the project specific
project
4) Quality standards consist of project
processes and product goals
5) Project results include both product
results and project management results
EXAMPLES of
product results and
project management results:
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41
project management results:
1) PRODUCT RESULTS
Deliverables
2) PROJECT MANAGEMENT RESULTS
Schedule performance
Cost performance
PREREQUISITES FOR PROJECT MANAGEMENT TEAM
15
42
PREREQUISITES FOR PROJECT MANAGEMENT TEAM
In order to evaluate quality control outputs, the project
management team must be aware of a working
knowledge of SQC (statistical quality control), mainly:
Sampling and
Probability
PROJECT MANAGEMENT TEAM
MUST KNOW
THE DIFFERENCE
between
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43
between
Prevention
Keeping errors out of process!
Inspection
Keeping errors out of the hands
of the customer!
Attribute Sampling
Implies either result conforms or
it does not conform!
Variable Sampling
Implies the result is rated on a
continuous scale that measures
magnitude of conformity!
PROJECT MANAGEMENT TEAM
MUST KNOW
THE DIFFERENCE
between
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44
between
Special Causes /
Non-random
Mean unusual occurrences!
Common Causes /
Random Causes
Mean normal process variation
Tolerances
Mean the result is acceptable if it
is within specified tolerance
range!
Control Limits
Define variation range of a
process. The process is said to be
in control if the result falls within
this range!
Perform Quality Control process overview
INPUTS
TOOLS &
TECHNIQUES
OUTPUTS
Quality control
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45
Project Management
Plan
Quality metrics
Quality checklists
OPAs
Work performance
measurements
Approved change
requests
Deliverables
INPUTS
Cause and effect
diagram
Control Charts
Flowcharting
Histogram
Pareto charts
Run chart
Scatter diagram
Statistical
Sampling
Inspection
Approved Change
Requests review
Quality control
measurements
Validated Changes
Change requests
Recommended defect
repair
OPAs updates
Validated deliverables
PM Plan updates
Project Document
Updates
Perform Quality
Control process
1) Project management plan
It contains quality management
plan which is used to control
15
46
INPUTS
plan which is used to control
quality.
Guides us how quality control
should be performed.
2) Quality metrics
Also have been duly deliberated by
us during Plan Quality
We bring them for use here.
Perform Quality
Control
3) Quality Checklists
We have with us as an output of our
discussion on quality planning. They
15
47
discussion on quality planning. They
come in handy here.
4) OPAs
Provide us quality control practices in
use, plus standards we need to
adhere to.
5) Work performance
Measurements
Important inputs to QC:
Perform Quality
Control
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Important inputs to QC:
Technical performance measures
Project deliverables completion
status
Implementation of required
corrective actions
Planned results and actual results
Implemented change requests
6) Approved change requests
Timely implementation of approved
change requests needs to be examined.
Perform Quality
Control
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change requests needs to be examined.
These change requests are modifications,
such as:
Revised work methods
Revised schedule
7) Deliverables
We have amply talked about them. We
examine them here if they meet quality
requirements.
1) Cause and effect diagram
(Ishikawa or fishbone diagrams)
Show how how various factors could
Perform Quality
Control process
TOOLS &
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Show how how various factors could
be linked to potential problems or
effects!
Help us find the causes of the quality
problems.
TOOLS &
TECHNIQUES
example
SAMPLE CAUSE AND EFFECT DIAGRAM
TIME MATERIAL METHOD MACHINE
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Major
Defect
EFFECT CAUSES
ENVIRONMENT PERSONNEL MEASUREMENT ENERGY
2) Control charts
Help us determine whether process is in
control.
Perform Quality
Control process
TOOLS &
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control.
They graphically display results, over
time, of a process.
COMPONENTS OF A CONTROL CHART:
1) Upper and lower control limits-
the acceptable range of variation of a
process, often shown as dotted lines.
2) Mean- a line in the middle showing the
middle of the range of acceptable
variation of the process.
TOOLS &
TECHNIQUES
Control charts
Perform Quality
Control process
TOOLS &
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3) Data points- random and non-random
data points. Their appearance and
position determines whether process is
in control or out of control.
4) Out of control- the process is out of a
state of statistical control under two
circumstances:
a) A data point falls outside ULC or LCL
b) Non-random data points still within
UCL and LCL
TOOLS &
TECHNIQUES
Control charts
Perform Quality
Control process
TOOLS &
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5) Rule of seven (heuristic)-
nonrandom data points grouping in
series on one side of the mean,
signifying process is out of control.
You must investigate such a situation,
find cause, and take corrective action.
TOOLS &
TECHNIQUES
Control charts
Perform Quality
Control process
TOOLS &
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6) Assignable cause- a random data
point outside control limits, or non
random data points (even though
within control limits, such a rule of
seven).
You must determine the cause of the
variation, find solution, and implement
it to bring process back to normal.
TOOLS &
TECHNIQUES
Sample Control Chart
Center line:
average of
process data
Upper line:
Upper
Rule of seven
(out of control)
Process out of control or
unstable: 1) points outside UCL
and LCL; 2) inside UCL & LCL
nonrandom points (seven)
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Assignable cause
(out of control)
Upper line:
upper range
of
acceptable
data
Lower line:
lower range
of
acceptable
data
X axis consists
of sample
numbers (time of
sample)
Upper
control limit
Lower
control limit
X Mean
Control charts
Please do not adjust the process when it is in control.
However, you may change the process to usher in
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However, you may change the process to usher in
improvements, but again remember that you will not adjust it
when its in control!
Any type of process output can be monitored by using control charts.
Control charts are mostly used to monitor repetitive activities
like production lots, but they can also be used to track if project
management process is in control:
Schedule and cost variances
Frequency and volume scope changes
Mistakes in project documents
Any other project management results
3) Flowcharting
Helps to analyze how problems
occur.
Perform Quality
Control process
TOOLS &
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occur.
Styles are many but all process
flowcharts show:
1) Activities,
2) Decision points, and
3) Order of processing
Show how various elements of the
process interrelate.
TOOLS &
TECHNIQUES
Flowcharting
Helps the project management
team anticipate:
Perform Quality
Control process
TOOLS &
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team anticipate:
1) What and where quality
problems might occur
2) Hence, help develop
approaches for dealing with
them
Example Flowcharting
TOOLS &
TECHNIQUES
Example: Flowcharting
(PROCESS FLOWCHART FOR DESIGN REVIEWS)
1
Project
request
2
Compliance
Copy
3
Develop
Artwork
4 NO
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6
Artwork out
For proofs
5
Change control
For specs
7
Vendors make
proofs
10
Approved
Proof back to
Vendor
11
Specs signed
(package & QA)
12
Order
materials
8
Package
Development
Review &
approval
9
QA review /
approval
4
Artwork
Approved
NO
YES
YES
YES
NO
NO
4) Histogram
A bar chart showing distribution of
variables:
Perform Quality
Control process
TOOLS &
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variables:
1) Each column represents an
attribute or characteristic of a
problem or situation.
2) Helps identify the cause of
problems in a process by the shape
and width of the distribution.
3) Height of each column shows
relative frequency of characteristic.
TOOLS &
TECHNIQUES
5) Pareto charts
Know 80/20 Rule? It says 80%
Perform Quality
Control process
TOOLS &
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Know 80/20 Rule? It says 80%
problems are due to 20% causes!
Well, it Paretos law which opines
that a relatively small number of
causes create a large majority of
defects/problems. Pareto diagrams
follow this concept.
TOOLS &
TECHNIQUES
Pareto diagrams
It is a histogram ordered by
Perform Quality
Control process
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It is a histogram ordered by
frequency of occurrence. That
means how many results were
produced by category/type of
identified cause.
Such rank ordering helps project
team take corrective action to
eliminate the problems causing
greatest number of defects first.
TOOLS &
TECHNIQUES
Sample Pareto Diagram (Chart)
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Cumulative
P
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CAR PROBLEMS
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0 0
25
50
75
10
20
30
Cumulative
Percentage
Frequency by Cause
P
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t
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6) Run chart
Shows history or pattern of variation!
Is a line diagram where data points
Perform Quality
Control process
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Is a line diagram where data points
are plotted in the order of occurrence!!
Depicts TRENDS in a process over
time, variation over time, declines or
improvements in a process over time.
Whats the advantage?
Helps forecast future outcomes based
on historical results!!!
TOOLS &
TECHNIQUES
Run chart
Trend analysis often used to monitor:
1) Technical Performance: how many
Perform Quality
Control process
TOOLS &
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1) Technical Performance: how many
defects have been identified and
how many remain uncorrected?
2) Cost and Schedule Performance:
How many activities (per period)
were done with significant
variances?
TOOLS &
TECHNIQUES
7) Scatter diagram
Shows pattern of relationship between
two variables.
Perform Quality
Control process
TOOLS &
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two variables.
Helps quality team examine and find
possible relationship between
changes observed in two variables!
- Dependent variables and
independent variables are plotted
- Closer they are to a diagonal line,
more closely they are related!
TOOLS &
TECHNIQUES
8) Statistical sampling
Inspecting by choosing only a part of
population of interest (SAMPLE).
Perform Quality
Control process
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population of interest (SAMPLE).
Example: selecting 5 cabins out of 100
cabins built on An Office Building Project.
Proper sampling reduces the cost of
quality control. It is best to apply if the
population under study is large and
examining the whole population would
cost a lot, take too long, and be too
destructive.
TOOLS &
TECHNIQUES
8) Inspection
DETERMINE if a work product
complies to requirements or not
Perform Quality
Control process
TOOLS &
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complies to requirements or not
ACTIVITIES: testing, examining,
measuring at any level - single activity
level or final product level.
KNOWN as: Audits,
Walkthroughs, Product Reviews,
Reviews.
In certain application areas, these terms
carry a specific or narrow meaning
TOOLS &
TECHNIQUES
Technical performance
We have sufficiently discussed about schedule and cost
performance. Besides them, project performance
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performance. Besides them, project performance
depends how well the project is meeting technical
requirements!!!
TECHNICAL PERFORMANCE is measured through
tracking the history of a set of technical objectives or
requirements over time. It provides management with the
information about how well the project is progressing with
respect to particular project objectives, targets, and
requirements (Quality).
The purpose of measuring technical performance is to
monitor progress in performance measures and their
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monitor progress in performance measures and their
relationship TO GOALS AND TARGETS BY
PROVIDING:
1) A best estimate of current technical performance or
progress to date, and
2) An estimate of technical performance at project
completion
BOTH KINDS OF ESTIMATES ARE BASED ON THE
RESULTS OF:
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RESULTS OF:
1) Modeling,
2) Simulation, or
3) Tests, and
4) Demonstrations
TO PERFORM IT, WE NEED TO HAVE CERTAIN
TECHNICAL PERFORMANCE MEASURES AS KEY
INDICATORS OF SUCCESS
THESE MESURES SHOULD BE TIED TO USER NEEDS AND
REPRESENT MAJOR PERFORMANCE DRIVERS!!!
Examples of Technical Performance Measures
Availability
Back-up Utility
Size or space
Reliability
Power
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Safety
Speed
Survivability
Maintainability
Flexibility
Cycle Time
Efficiency
Output Rate
Capacity
Response Time
Security
Setup Time
Durability
Range
Variance
Cost
Utilization
Error / Defect Rate
Power
Interface
Compatibility
Interoperability
Simplicity /
Complexity
Signal-to-noise
Ratio
Trip Time
Idle Time
MEASUREMENT:
STEP 1
STEP 3
Current estimates and the
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74
STEP 1
Periodically,
current (actual)
Performance
Estimates
are computed
or measured
STEP 2
And then, they
are compared
to objectives
Initially, they are based on results from Modeling and Simulation
Activities, and later on Test and Demonstration results
Using actual Hardware and Software
Current estimates and the
Technical objectives are
Charted on a time-phased TPM
Chart which SIMPLIFIES
determining the extent of
progress made toward
Achieving Objectives
9) Approved Change
Requests review
Done to ensure that product
Perform Quality
Control process
TOOLS &
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Done to ensure that product
defects are repaired and
brought into compliance with
requirements/specifications!
TOOLS &
TECHNIQUES
1) Quality control
measurements
Are Results of QC.
Perform Quality
Control process
OUPUTS
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Are Results of QC.
They are fed back to QA to
reevaluate and analyze the
efficiency and effectiveness of
quality standards and processes of
the performing organization!
Please do remember!!
OUPUTS
2) Validated Changes
Repaired items re inspected
to confirm if they are ok now.
Perform Quality
Control process
OUPUTS
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77
to confirm if they are ok now.
Rejection again may require
further repair.
Decision is notified after
examination.
OUPUTS
3) PM Plan Updates
Quality management plan (a
component of PM Plan) needs to be
Perform Quality
Control process
OUPUTS
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component of PM Plan) needs to be
updated to reflect approved changes
resulting from QC.
QC may lead to incorporation of
approved changes in other
components (subsidiary plans) of the
PM Plan also.
All changes are first reviewed by ICC
for approval!
OUPUTS
4) OPA Updates
include
a) Completed Checklists,
Perform Quality
Control process
OUPUTS
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a) Completed Checklists,
b) Lessons learned
documentation.
OUPUTS
5) Validated Deliverables
Quality Control is done to
determine the correctness of
Perform Quality
Control process
OUPUTS
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determine the correctness of
deliverables.
The results of execution quality
control processes are validated
deliverables.
They are an input to verify
scope for formalized
acceptance.
OUPUTS
6) Change Requests
include
a) defect repair
Perform Quality
Control process
OUPUTS
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a) defect repair
b) corrective action
c) preventive action
7) Project Document Updates
may include
- Quality Standards.
OUPUTS
Project communications management
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REPORT PERFORMANCE
REPORT PERFORMANCE
The process of
Collecting and distributing performance
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Collecting and distributing performance
Information, including status reports, progress
measurements, and forecasts.
INVOLVES
Periodic collection and analysis of baseline
versus actual data to understand and
communicate.
REPORT PERFORMANCE
The process of
Performance reports need to be provide
information at an appropriate level for each
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information at an appropriate level for each
audience. It may be a simple report or an
elaborate one.
A simple status report might show percentage
complete or status dashboards for scope,
schedule, cost, and quality.
REPORT PERFORMANCE
An elaborate report may include:
1) Analysis of past performance
2) Current status of risks and issues
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2) Current status of risks and issues
3) Work completed during the period
4) Work to be completed next
5) Summary of changes approved for the period
6) Other relevant information which may be reviewed
and discussed.
A COMPLETE REPORT SHOULD ALSO INCLUDE
FORECASTED COMPLETION INCLUDING TIME
AND COST!!
CONSISTS OF
REPORT PERFORMANCE
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CONSISTS OF
collecting and disseminating
performance information
to
stakeholders
about
HOW RESOURCES ARE USED TO ACHIEVE
PROJECT OBJECTIVES
1. Status reporting
REPORT PERFORMANCE
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Where the project now
stands
Budget metrics
Schedule achieved
2. Progress reporting
Work packages complete
Work packages in
progress,
Percentage complete
Forecasting schedule and
3. Forecasting
Estimating where it will
land in future
Forecasting schedule and
cost based on the trends
of current progress
Must provide information on:
Scope
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Many projects need information on Risk and Procurement also!
Scope
Schedule
Cost
Quality
Report Performance process overview
TOOLS &
TECHNIQUES
INPUTS OUTPUTS
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TECHNIQUES
Variance Analysis
Forecasting
Methods
Communication
Methods
Reporting
systems
Project Management
Plan
Work Performance
measurements
Budget Forecasts
Assets
INPUTS OUTPUTS
Performance Reports
Change Requests
OPAs updates
Report Performance - INPUTS
Provides information on project baselines.
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Provides information on project baselines.
Project execution is compared to these baselines
And deviations are measured for management
control.
It typically integrates Scope, Schedule, and Cost
parameters of a project but may also include
Technical and Quality parameters.
2. Work performance information
(collected from execution)
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1. Deliverables Status
2. Schedule progress
3. Costs incurred
3. Work performance measurements
Work performance information is used to
generate project activity metrics to evaluate
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generate project activity metrics to evaluate
actual progress compared to planned progress.
THE METRICS INCLUDE:
1. Planned versus actual schedule performance
2. Planned versus actual cost performance
3. Planned versus actual technical performance
4. Work performance measurements
Budget forecast information from Control Cost
process give information on additional funds
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process give information on additional funds
are expected to be be required for the
remaining work, and also estimates for the
completion of the total project work.
provide:
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a) Reporting templates
b) Policies and procedures with measures and
indicators for use
c) Defined variance limits
Report Performance TOOLS & TECHNIQUES
1. Variance Analysis
An after-the-fact look at what caused a
difference between the baseline and actual
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95
difference between the baseline and actual
performance!
The process varies with application area, the
standard used, and and the industry.
COMMON STEPS
a) Verify the quality of the information collected
COMMON STEPS
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a) Verify the quality of the information
collected to ensure it is complete, consistent with
past data, and credible.
b) Determine variances, and note all differences
both favorable and unfavorable to project
outcomes.
c) Determine the impact of variances.
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ANALYZE THE TRENDS OF VARIANCES AND
RECORD FINDINGS ABOUT SOURCES OF
VARIATIONS AND IMPACT AREA.
2. Forecasting Methods
a) TIME SERIES METHODS:
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a) TIME SERIES METHODS:
Use historical data as the basis for estimating
future outcomes.
Examples: Earned Value, Moving Average,
Extrapolation, Linear Prediction, Trend
estimation, and Growth Curve.
b) CASUAL/ ECONOMICAL METHODS:
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Use the assumption that it is possible to identify
the underlying factors that might influence the
variable that is being forecasted. Sales of
Umbrellas might be associated with weather
conditions.
16
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THE PROCESS: If the causes are understood,
projections of the influencing variables can be
made and used in the forecast!
Example: Regression Analysis (using linear or
non-linear regression), Autoregressive Moving
Range (ARMA), and Econometrics.
c) JUDGMENTAL METHODS: Use intuitive
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c) JUDGMENTAL METHODS: Use intuitive
judgments, opinions, and probability estimates.
Composite forecast, Delphi, Scenario Building,
Technology Forecasting, and Forecast By Analogy.
d) OTHER MRTHODS: Simulation, Probabilistic
Forecasting, and Ensemble Forecasting.
Status Review Meetings used to exchange and
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Status Review Meetings used to exchange and
analyze information about the project progress and
performance. The project manager generally uses
a PUSH COMMUNICATION technique for
distributing performance reports. Please remember
this!.
4. Reporting Systems
A reporting system provides a standard tool for
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A reporting system provides a standard tool for
the project manager to:
- capture, store, and distribute schedule, cost,
progress, and performance to the stakeholders.
Software packages help project manager to
consolidate reports from several systems and
facilitate report distribution. Examples of
distribution formats: Table Reporting, Spreadsheet
Analysis, and Presentations.
Predicting future project performance based on
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Predicting future project performance based on
actual performance to date! Methods:
a) TIME SERIES METHODS
b) CASUAL/ ECONOMICAL METHODS
c) JUDGMENTAL METHODS
d) OTHER MRTHODS
Report Performance - OUTPUTS
1. Performance reports
You prepare performance reports by organizing
and summarizing the performance information
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05
and summarizing the performance information
gathered by you and then presenting the results
of the analysis in suitable formats:
1) Bar Charts (Gantt charts)
2) S-curves
3) Histograms
4) Tables
Variance Analysis, Earned Value Analysis, Forecast
Data are included in the report!
Reports must display the type of information
and level of detail needed by various
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06
and level of detail needed by various
stakeholders (as defined in the
communications management plan).
Performance reports are issued periodically.
They may a simple status report or an elaborate
one. Elaborate reports include:
Elaborate reports include:
- Analysis of past performance,
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07
- Analysis of past performance,
- Current status of risks and issues,
- Work to be completed during the next reporting
period,
- Summary of approved changes for the period,
- Results of variance analysis,
- Forecasts,
- Other information for review and discussion.
Example: Performance Report in bar chart
Unit Projected
Actual
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Engineering
Design
Facility
And so on
Time
Actual
Example: Performance Report in S-curve
Date of measurement
C
u
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a
t
i
v
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V
a
l
u
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s

i
n

I
N
R
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Planned Value (PV)
Earned Value (EV)
Actual Value (AV)
C
u
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l
a
t
i
v
e

V
a
l
u
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s

i
n

I
N
R
Time
Essar Cargo Project: Performance Report Week 20 (cumulative to date)
REAL LIFE
EXAMPLE
CPI SPI SV CV EV AC PV ACTIVITY
H 100 100 100 0 0 1.00 1.00
Tabular form
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10
J
K
L
M
N
O
P
Q
I 64
96
16
36
84
40
20
24
32
512 PROJECT
70
97
12
30
110
45
28
22
16
530
64
96
14
18
33
40
24
24
16
429
0
0
- 2
- 18
- 51
0
4
0
- 16
- 83
- 6
- 1
2
- 12
- 77
- 5
- 4
2
0
- 101
1.00
1.00
0.88
0.50
0.39
1.00
1.20
1.00
0.50
0.84
0.91
0.99
1.17
0.60
0.30
0.89
0.86
1.09
1.00
0.81
2. Organizational process assets updates
1) Report Formats,
2) Lessons Learned Documentation , including
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11
2) Lessons Learned Documentation , including
the causes of issues, reasoning behind
corrective action,
3) Other type of lessons learned about
performance reporting.
3. Change Requests
Analysis of performance often generates Change
Requests. They are processed through the
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Requests. They are processed through the
as:
a) Recommended corrective action
to bring expected future performance in line
with the plan.
a) Recommended preventive action
to reduce the probability of of incurring future
negative performance.
MONITOR
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MONITOR
AND
CONTROL
RISKS
Monitor and control Risks
THE CONCEPT
Planned Risk Responses are executed during project
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14
life cycle, but the Project Work MUST BE CONTINOUSLY
MONITORED FOR NEW AND CHANGING RISKS!
FOR THIS, YOU SHOULD:
1. IDENTIFY, ANALYZE, AND PLAN FOR NEWLY
ARISING RISKS
2. KEEP TRACK OF THE IDENTIFIED RISKS AND THE
ONES ON WATCHLIST
THE CONCEPT
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3. REANALYZE EXISTING RISKS
4. MONITOR TRIGGER CONDITIONS FOR
CONTINGENCY PLANS
THE CONCEPT
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5. MONITOR RESIDUAL RISKS
6. REVIEW EXECUTION OF RISK RESPONSES WHILE
EVALUATING THEIR EFFECTIVENESS
THE CONCEPT
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APPLIES TECHNIQUES (VARIANCE ANALYSIS,
TREND ANALYSIS, ETC) USING THE PERFORMANCE
DATA GENERATED DURING PROJECT EXECUTION
THE RISK MONITORING AND CONTROL
(PLUS OTHER RISK MANAGEMENT PROCESSES)
IS AN ONGOING PROCESS
FOR THE LIFE OF THE PROJECT!
THE CONCEPT
We also document risk metrics linked with
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We also document risk metrics linked with
executing contingency plans
New risks develop or anticipated ones no
longer exist with the progress of the project as
it attains maturity by that time
THE CONCEPT
Making effective decisions before risk occurs is
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Making effective decisions before risk occurs is
the crux of risk monitoring and control processes
You must periodically ascertain the risk
acceptability level of project stakeholders by
reporting information to them!
THE CONCEPT
HELPS US ENSURE WHETHER
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We have executed the risk responses as
planned.
Our risk response actions are effective as
envisaged or we need to develop new ones.
Project assumptions still holding good.
Risk exposure (from earlier state) is steady or
not.
THE CONCEPT
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A risk trigger has taken place.
Adequate policies are being observed.
Any new risks have happened (the ones not
identified by us earlier).
Updated the risk register and risk identification
checklists.
THE CONCEPT
REQUIRES YOU TO
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REQUIRES YOU TO
1) Choose Alternative Strategies
2) Execute a Contingency Plan or Fallback Plan
3) Take Corrective Action
4) Modify the Project Management plan
THE CONCEPT
RISK RESPONSE OWNERS REPORTS PERIODICALLY
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RISK RESPONSE OWNERS REPORTS PERIODICALLY
TO THE PROJECT MANAGER
The effectiveness of the plan,
Any unexpected impacts,
Any corrective action required in the mid-
course for handling the risk appropriately.
Monitor and Control Risks process overview
INPUTS
TOOLS &
TECHNIQUES
OUTPUTS
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Project Management
Plan
Risk Register
Work performance
information
Performance Reports
INPUTS
TECHNIQUES
Risk
Reassessment
Risk audits
Variance and trend
analysis
Technical
Performance
Measurement
Reserve analysis
Status meetings
OUTPUTS
Change Requests
OPAs updates
PM Plan updates
Project document
updates
Provides RMP that Defines procedure
for structuring and performing the response
Monitor and Control
Risks
INPUTS
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for structuring and performing the response
planning during the project life cycle.
Risk Register (provides key inputs)
Identified risks, risk owners, agreed-
upon risk responses, specific
implementation actions, symptoms,
warning signals, residual and
secondary risks, watchlist, time and
cost contingency reserves.
Project Management
Plan
Risk Register
Work performance
information
Performance Reports
INPUTS
Work performance
information
Including project deliverables status,
INPUTS
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26
Including project deliverables status,
corrective actions, and performance
reports serve as important inputs here!
Project Management
Plan
Risk Register
Work performance
information
Performance Reports
INPUTS
Performance reports
Provide us information on project work
performance.
INPUTS
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27
performance.
We need to know if any performance
analysis impacts the risk management
processes!
Project Management
Plan
Risk Register
Work performance
information
Performance
Reports
INPUTS
Risk reassessment
We regularly identify new risks
and reassess known ones!
TOOLS &
TECHNIQUES
16
28
and reassess known ones!
Risk management must be an
agenda in at project team
status meeting!
TECHNIQUES
Risk
Reassessment
Risk audits
Variance and trend
analysis
Technical
Performance
Measurement
Reserve analysis
Status meetings
Risk reassessment
AS PROJECT PERFORMANCE
TOOLS &
TECHNIQUES
16
29
AS PROJECT PERFORMANCE
MEASURED AND REPORTED
POTENTIAL RISKS
NOT IDENTIFIED EARLIER
CYCLE OF RISK
MANAGEMENT PROCESSES
FOR THESE RISKS
MAY SURFACE
IMPLEMENT
TECHNIQUES
Risk
Reassessment
Risk audits
Variance and trend
analysis
Technical
Performance
Measurement
Reserve analysis
Status meetings
Additional risk response
planning
That was
1) Not anticipated in
TOOLS &
TECHNIQUES
16
30
A RISK EMERGES
1) Not anticipated in
the Risk response
plan, or
2) Its impact on
objectives IS
GREATER THAN
EXPECTED
ADDITIONAL
RISK RESPONSE PLANNING
Planned
response
not adequate
TO
CONTROL
RISK
TECHNIQUES
Risk
Reassessment
Risk audits
Variance and trend
analysis
Technical
Performance
Measurement
Reserve analysis
Status meetings
Risk audits
Conducted during the project life cycle
TOOLS &
TECHNIQUES
16
31
Risk
Auditors
EXAMINE AND RECORD
EFFECTIVENESS OF
RISK RESPONSE ACTIONS
How much they have succeeded
in avoiding, transferring, mitigating
negative risks, and enhancing the
opportunities for positive risks
Effectiveness of the RM Process!
TECHNIQUES
Risk
Reassessment
Risk audits
Variance and trend
analysis
Technical
Performance
Measurement
Reserve analysis
Status meetings
Variance & trend analysis
Variance and trend in project
execution is reviewed with the help
TOOLS &
TECHNIQUES
16
32
execution is reviewed with the help
of:
1) Performance data,
2) EV Analysis,
3) Other means of project variance
and trend analysis.
WHY? Answer: Outcomes from these
analyses may forecast cost and schedule
potential deviations at project
completion!
TECHNIQUES
Risk
Reassessment
Risk audits
Variance and
trend
analysis
Technical
Performance
Measurement
Reserve analysis
Status meetings
Variance & trend analysis
WHY?
Answer:
TOOLS &
TECHNIQUES
16
33
Answer:
Outcomes from these analyses
may forecast Cost and
Schedule potential deviations at
Project completion!
2) It may indicate potential impact of
threats or opportunities!
TECHNIQUES
Risk
Reassessment
Risk audits
Variance and
trend analysis
Technical
Performance
Measurement
Reserve analysis
Status meetings
examples
BEWARE OF SCOPE CHANGES!
TOOLS &
TECHNIQUES
16
34
SCOPE CHANGES
NEW RISK ANALYSIS
NEW RESPONSE PLANS
WE HAVE ALREADY DISCUSSED
SCOPE CHANGES
TECHNIQUES
Risk
Reassessment
Risk audits
Variance and
trend analysis
Technical
Performance
Measurement
Reserve analysis
Status meetings
Earned value analysis
EV analysis ( as already discussed )
used for tracking overall project
TOOLS &
TECHNIQUES
16
35
used for tracking overall project
performance against a baseline
plan
Results tell us about potential
deviation of the project at
completion from schedule and cost
objectives
If a project deviates substantially from
the baseline, updated risk identification
and analysis must be conducted!
TECHNIQUES
Risk
Reassessment
Risk audits
Variance and
trend analysis
Technical
Performance
Measurement
Reserve analysis
Status meetings
measurement
Compares technical performance
TOOLS &
TECHNIQUES
16
36
Compares technical performance
accomplishments during execution
to the project plans schedule for
technical achievement.
Example:
If a functionality
planned as a milestone
is not demonstrated,
it poses risk
to attaining projects scope!
TECHNIQUES
Risk
Reassessment
Risk audits
Variance and
trend analysis
Technical
Performance
Measurement
Reserve analysis
Status meetings
Reserve analysis
Compares the amount of COST AND
SCHEDULE contingency reserve left
TOOLS &
TECHNIQUES
16
37
SCHEDULE contingency reserve left
to the amount of risks remaining AT
ANY TIME IN THE PROJECT!
To find out if the remaining
contingency is sufficient for
remaining risks!
TECHNIQUES
Risk
Reassessment
Risk audits
Variance and
trend analysis
Technical
Performance
Measurement
Reserve
analysis
Status meetings
Status meetings
VERY IMPORTANT TOOL!
Risk reviews must be done regularly
All meetings should have it as a
TOOLS &
TECHNIQUES
16
38
All meetings should have it as a
necessary agenda!
ALSO, PLEASE REMEMBER:
1) As the project advances, the risk
ratings and prioritization may
change.
2) These changes may need
additional qualitative and
quantitative analysis.
TECHNIQUES
Risk
Reassessment
Risk audits
Variance and
trend analysis
Technical
Performance
Measurement
Reserve
analysis
Status meetings
Two categories of updates:
Results of risk reassessments, risk
OUTPUTS
16
39
Results of risk reassessments, risk
audits, and risk views. Examples:
updates to Probability, Impact,
priority, response plans, ownership,
and other items of risk register.
Risk register
updates
Change Requests
OPAs updates
PM Plan updates
Project document
updates
Two categories of updates:
Actual outcomes of risks and risk
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40
Actual outcomes of risks and risk
responses which help us plan for
risk throughout our organization (for
future projects). This concludes the
record of risk management on the
project and serves as input to
Close Project process and included
in project closure documents!
Performing Risk
Controls
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41
RISKS
Record
and
Evaluate
Record
and Close
in risk
register
Controls
reduces the
impact or
probability of
identified - tive
Risks and
enhances
opportunity for
+ tive risks
Reassess Risk
Ratings to properly
control New,
Important Risks
Change Requests
Frequently, the implementation of
contingency or workaround plans
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42
contingency or workaround plans
necessitates change to PM Plan! ICC
reviews and approves them.
Then, they become input to
1) Direct & Manage Project Execution
process
2) Risk monitoring & control process
Change Requests
Requirement to
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43
Contingency or
Workaround plans
Implemented
Requirement to
Change
the project
Plan
Change
Request
Often
Results
Into
Integrated
Change control
Risk
Monitoring &
Control
Direct &
Manage Project
Execution
Approves the requested change
Include :
Contingency plans and workaround
Change Requests
16
44
plans
Workaround plans must be properly
recorded. They are included in both
process and Monitor & Control
Project Work process! Remember!!
Workaround plans
Are Unplanned Responses to the
emerging risks which were not
Change
Requests
May lead to
16
45
emerging risks which were not
identified or accepted passively.
DOCUMENT WORKAROUNDS
IN PM PLAN
AND RISK RESPONSE PLAN
WORKAROUNDS:
Unplanned
Responses
RISKS
( not identified or accepted passively)
May lead to
Recommended preventive
actions
Are actions taken to bring the project
Change
Requests
May lead to
16
46
Are actions taken to bring the project
into compliance with Project
Management Plan.
OPAs updates
All the six risk management processes
provide information that can help future
projects, and hence must be entered in
OPAs.
examples
May lead to
OPAs updates
Examples:
1) Templates for the following can be
16
47
1) Templates for the following can be
updated at Project Closure:
risk management plan template
P & I Matrix template
risk register template
2) Risks can be documented and RBS
updated.
3) Risk Lessons Learned can be
entered in OPAs.
OPAs updates Examples:
16
48
OPAs updates Examples:
4) Data on actual costs and durations
can be added to organizations
database.
5) Final versions of risk register and
risk management plan templates are
included.
Risk database( a useful repository )
RISK REPOSITORY
RISK DATA
Assists risk management
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49
RISK DATA
COLLECTED,
MAINTAINED,
And ANALYSED
RISK
MANAGEMENT
PROCESSES
USED IN
Assists risk management
throughout the
organization
Over time, builds
basis of A RISK
LESSONS LEARNED
PROGRAM
ITS USE
Updates to risk identification checklist
16
50
1
2
3
4
5
6
7
8
9
Updated checklist
ORIGINAL
CHECKLIST
1.
2.
3.
4.
5.
UPDATED
BY
EXPERIENCE
WILL HELP
RISK
MANAGEMENT
OF
FUTURE
PROJECTS
PM Plan updates
When approved changes impact risk management
processes, corresponding component documents of PM
16
51
processes, corresponding component documents of PM
Plan are revised and reissued to reflect those changes.
- Assumptions log updates
- Technical documentation updates
ADMINSTER
16
52
ADMINSTER
PROCUREMENTS
You have selected the seller
16
53
You have selected the seller
who begins work as per contract.
Now what is
your prime responsibility
from buyers side?
16
54
Ensure that sellers performance meets
contractual requirements
Manage interfaces among various providers if
you are procuring multiple products and services
Be absolutely clear of the legal implications of
the actions taken while administering the
contract
16
55
But how do you ensure that sellers
performance meets your projects
requirements?
Well, you apply suitable project management
processes and integrate outputs of these
processes into overall management of the
project!
16
56
But how do you ensure that sellers
performance meets your projects
requirements?
You also integrate and coordinate at many
levels if your project involves many sellers
and many products from them
Sample: Application of project management processes to
Administer Procurements process
Contract administration PM Process used
16
57
Contract administration PM Process used
Authorizing contractors work at
appropriate time
Project plan execution
Monitoring contractors technical
performance, schedule, and cost
Performance reporting
Inspecting and verifying the adequacy
of contractors product
Quality control
Ensuring that changes are properly
approved , and this information is
distributed to the concerned
stakeholders
Change control
Financial aspect
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58
Financial aspect
Seller progress has direct linkage with seller payment as duly
defined in the contract.
Please remember this while administering the contract and
Verifying sellers work!
Otherwise, difference of opinion between you and the seller will
give rise to claims, disputes, and appeals.
Administer Procurements process overview
Procurement
INPUTS
TOOLS &
TECHNIQUES
OUTPUTS
16
59
Procurement
documents
Project Management
Plan
Contract
Performance reports
Approved change
requests
Work Performance
information
Contract Change
Control System
Procurement
Performance reviews
Inspections & audits
Performance
reporting
Payment Systems
Claims
administration
Records
management system
Procurement
documentation
Change requests
OPAs updates
PM Plan updates
provide complete supporting records for administration
of procurement process and includes procurement
Administer Procurements process INPUTS
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60
of procurement process and includes procurement
contract awards and SOW.
Guides us on how to administer the contract. We have
discussed it already.
Contract
Is the main input. We have
Administer
Procurements
process
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61
Performance reports
- Seller-developed technical
documentation and other
deliverables information given as
per contract terms and conditions
- Seller performance reports about
scope, time, cost, and quality.
process
INPUTS
INCLUDE approved modifications
to contract terms and conditions
Administer
Procurements
process
16
62
to contract terms and conditions
(including SOW, Pricing, Product
description of products, services,
or results to be provided by
contractor)
All changes are formally recorded and
approved before implementation! Verbally
discussed or unrecorded changes MUST NOT
be processed or allowed for implementation!
process
INPUTS
Work performance
information
As contractor begins performing the
Administer
Procurements
process
16
63
As contractor begins performing the
work, we start getting the outcomes:
1) Which deliverables have been
accomplished, which ones left.
2) Extent to which quality standards have
been met.
3) What costs have been incurred or
committed
4) Whether schedule has been met, etc
Seller should give timely invoices as per contract.
process
INPUTS
Seller invoices
Yes, when seller is doing work, the
Administer
Procurements
process
16
64
Yes, when seller is doing work, the
invoices for the completed work, or as
per the terms of the contract also come
and serve as important inputs to contract
administration.
These invoices are accompanied by all
supporting documents to help you
approve payment.
process
INPUTS
Contract change control
system
Administer
Procurements
16
65
system
Procedure for modifying the contract.
Consists
paper work, tracking system, dispute
resolution procedures, approval levels
necessary for authorizing changes.
CAUTION: PLEASE DONT FORGET TO
INTEGRATE THE CONTRACT CHANGE
CONTROL SYSTEM WITH THE INTEGRATED
CHANGE CONTROL SYSTEM!!!
Procurements
process
Tools &
Techniques
Procurement performance
reviews
Consists
Administer
Procurements
16
66
Consists
Sellers progress to deliver scope and
quality, within cost and on schedule,
compared to what is mentioned in
contract!
Includes review of seller
documentation and inspections by
buyer!
Quality audits during work execution
process
Tools &
Techniques
Procurement performance
reviews
Administer
Procurements
16
67
reviews
Whats the objective? Answer:
To identify performance successes or
failures,
To judge Sellers progress as
compared to CSOW,
Find contract non-compliance to
quantify sellers demonstrated
ability/inability to do work.
Procurements
process
Tools &
Techniques
TOOLS &
TECHNIQUES
Contract Change
Control System
Inspection and audits
Required by buyer, supported by
seller
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68
Control System
Procurement
Performance
reviews
Inspections &
audits
Performance
reporting
Payment System
Claims
administration
Records
management system
seller (as mentioned in contract)
To identify any weaknesses in sellers
work processes or deliverables during
execution.
May include buyers procurement
personnel if authorized by contract.
TOOLS &
TECHNIQUES
Contract Change
Control System
Performance reporting
How effectively seller is achieving
contractual objectives!
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69
Control System
Procurement
Performance
reviews
Inspections &
audits
Performance
reporting
Payment System
Claims
administration
Records
management system
contractual objectives!
You should not forget to integrate it
into Performance Reporting Process of
your project (buyer side).
Payment system
Buyer accounts payable system
handles payments to the seller. On
large projects, you can have your own
payment system.
TOOLS &
TECHNIQUES
Contract Change
Control System
Payment system
The project management team reviews
and approves payment and then the
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70
Control System
Procurement
Performance
reviews
Inspections &
audits
Performance
reporting
Payment System
Claims
administration
Records
management system
and approves payment and then the
payment is made in accordance with
the the contract terms.
Claims administration
Claims are those contested and
constructive change requests for which
buyer refuses to compensate or does
not agree that change has happened.
Claims are also called disputes and appeals.
Claims administration
Claims are recorded, processed, and
managed throughout contract life cycle
TOOLS &
TECHNIQUES
Contract Change
Control System
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71
managed throughout contract life cycle
as per clauses of the contract.
If parties are not able to resolve, it has
to be then resolved as per Dispute
Resolution Procedures mentioned in
the contract, like:
1) Arbitration
2) Litigation
It can happen before or after the contract
closure!
Control System
Procurement
Performance
reviews
Inspections &
audits
Performance
reporting
Payment System
Claims
administration
Records
management system
TOOLS &
TECHNIQUES
Contract Change
Control System
Records management system
A set of processes to manage contract
documentation and records (S/W, PMIS).
PURPOSE? Helps maintain an index of
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72
Control System
Procurement
Performance
reviews
Inspections &
audits
Performance
reporting
Payment System
Claims
administration
Records
management system
PURPOSE? Helps maintain an index of
contract documents/correspondence.
Helps their retrieval and archival!
Information Technology
Enhances efficiency and effectiveness
of contract administration by automating
portions of: records management system,
payment system, claims administration,
performance reporting, and exchange of data
between parties!
Procurement documentation
INCLUDES:
Contract itself with supporting schedules
Approved contract change requests
Outputs
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73
Approved contract change requests
Unapproved contract change requests
Seller-developed technical documentation
Other work performance information like
Deliverables
Seller performance reports
Warranties
Financial documents (invoices, payment
records)
Results of inspections
Change Requests
CONTRACT ADMINSTRATION MAY LEAD
TO REQUESTED CHANGES TO PM
PLAN, ITS COMPONENTS, LIKE
Outputs
16
74
PLAN, ITS COMPONENTS, LIKE
PROJECT SCHEDULE. ICC reviews
before their approval.
Examples:
Can include directions from buyer,
Actions taken by seller
But the other party must deem it to be a
beneficial change to the contract.
Such constructive changes, if disputed,
become claims!
OPAs updates
1) Seller performance evaluation
Outputs
16
75
1) Seller performance evaluation
documentation
2) Payment schedules & payments
3) Correspondence
OPAs updates
Seller performance evaluation
documentation records sellers
Outputs
16
76
documentation records sellers
ability to continue to perform work
on the contract.
Helps decide if seller should be
given work on future projects and be
included in qualified sellers list for
future.
These documents also help decide contract
termination, penalties, fees, or incentives!
OPAs updates
Payment schedules and requests
are received and disposed by
Outputs
16
77
are received and disposed by
buyers Accounts Payable System
(assuming it is external to project).
OPAs updates
Correspondence is written record of
buyer-seller communication, mainly:
1) warnings of unsatisfactory
performance, requests for changes,
or clarifications.
OPAs updates
Correspondence is written record of
Outputs
16
78
2) can include reported results of
buyer inspections and audits that
show weaknesses seller needs to
correct.
3) A complete and accurate record
of all written and oral
communications and actions taken
and decisions made.
PM Plan updates
Procurement management plan is
updated to reflect approved change
Outputs
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79
updated to reflect approved change
requests that impact it and so
require its revision.
Baseline schedule If there are
slippages that impact overall project
performance, the baseline schedule
may require to be updated to show
current expectations!
CLOSING
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80
CLOSING
PROCESSES
POSITION IN PROJECT MANAGEMENT LIFE CYCLE
PLANNING INITIATING
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81
CONTROLLING
& MONITORING
PROCESSES
CLOSING
PROCESSES
EXECUTING
PROCESSES
PLANNING
PROCESSES
INITIATING
PROCESSES
Process Groups Interactions (partial)
Executing Process
Group
Organizational
Process
Assets
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82
Closing Process
Group
M & C Process
Group
Customer
Final product,
Service, result
Administrative closure procedure
Contract closure procedure
Rejected change requests
Approved corrective actions/ preventive actions
Approved defect repair
PM Plan Updates
Scope statement updates
Recommended corrective actions
Recommended preventive actions
Recommended defect repair
Forecasts
Approved deliverables
Organizational process updates
THE CONCEPT
Projects are have a definite beginning and a
definite end.
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83
definite end.
The end is reached
1. When objectives are accomplished
2. When it is concluded that objectives will not be / cant be
achieved
3. When the need for the project no longer exists, or
4. The project is terminated before completion ( for various
reasons )
THE CONCEPT
During closing, it is the project manager who
ensures that all project-related work has been
completed and formally closed out by a specific
16
84
completed and formally closed out by a specific
date.
It is his / her responsibility to put an end to the
project (sometimes through requirement when
there is no follow-up project)!
By the time the end-item has been delivered and
installed, many people in the project will have
lost the enthusiasm and be anxious to move on
to another project.
THE CONCEPT
As a result, the project closeout gets little
attention as managers shift their emphasis to
16
85
attention as managers shift their emphasis to
upcoming projects OR scan the environments
FOR LEADS about potential projects.
YET, CLOSING A PROJECT PROPERLY IS NO
LESS IMPORTANT THAN ANY OTHER PROJECT
ACTIVITY!
The process of project closeout is so critical that
it can determine whether ULITIMATELY project
was A SUCCCESS OR FAILURE.
THE CONCEPT
UNLESS formally closed, the projects have a
tendency to drag on:
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86
tendency to drag on:
Sometimes unintentionally from neglect or
insufficient resources
Sometimes intentionally for lack of follow-up
work
Workers stay on project payroll for months after
their obligations have been met, which can turn
an otherwise successful project into financial
failure
THE CONCEPT
As long as the project has not been officially
closed, work orders remain open and labor
16
87
closed, work orders remain open and labor
charges continue to incur.
The seeds of successful closeout are sown early
in the project: Since closure requires customer
acceptance, the Criterion of Acceptance
SHOULD BE CLEARLY DEFINED, AGREED
UPON, and DOCUMENTED at the beginning of
the project.
THE CONCEPT
Any subsequent changes to criteria (made
during the project) must be approved both by
16
88
during the project) must be approved both by
contractor and customer.
Throughout all phases of the project, the project
manager must emphasize achievement of
customers acceptance criteria!
THE CONCEPT
The Closing Process Group consists of
THE PROCESSES USED TO FORMALLY
16
89
1) THE PROCESSES USED TO FORMALLY
TERMINATE ALL ACTIVITIES OF THE PROJECT
OR A PHASE
2) HAND OFF THE COMPLETED PRODUCT TO
OTHERS, OR
3) CLOSE A CANCELLED PROJECT
THE CONCEPT
The Closing Process Group (when completed)
verifies
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90
verifies
1) THAT THE DEFINED PROCESSES ARE
COMPLETED WITHIN ALL PROCESS GROUPS
TO CLOSE THE PROJECT OR A PHASE!
2) FORMALLY ESTABLISHES THAT THE
PROJECT OR PHASE IS FINISHED!
THE CONCEPT
The Closing Process Group processes
Close Procurements CLOSE PROJECT or phase
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91
1) COMPLETION AND
SETTLEMENT OF THE
CONTRACT,
2) RESOLUTION
OF OPEN ITEMS IF ANY
1) GENERATING, GATHERING,
AND DISSEMINATING
INFORMATION TO
FORMALIZE PROJECT OR
PHASE COMPLETION
2) EVALUATING THE PROJECT
3) COMPILING LESSONS
LEARNED FOR USE IN
FUTURE PROJECTS OR
PHASES
Close Procurements CLOSE PROJECT or phase
CLOSE
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92
CLOSE
PROCUREMENTS
CLOSE PROCUREMENTS
SUPPORTS the administrative closure of the project,
16
93
SUPPORTS the administrative closure of the project,
as it involves verification that all work and deliverables
were acceptable (contracted work being part of the total
Project)
ENTAILS administrative activities:
1) Updating of records to reflect final results
2) Archiving this information for future use
ADDRESSES each contract applicable to the project
CLOSE PROCUREMENTS
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94
ADDRESSES each contract applicable to the project
or its phase
In multi-phase projects, the term of a contract may
only be relevant to a concerned phase then this
process closes the contract(s) relevant to the phase
CONTRACT terms and conditions can mention:
Specific Procedure for contract closure
EARLY TERMINATION of a contract is a special
CLOSE PROCUREMENTS
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95
EARLY TERMINATION of a contract is a special
case of contract closure that may happen from:
1) A mutual agreement between the parties
2) Default of one of the parties
Each contract contains Termination Clause (in case
early termination) detailing the rights and responsibilities
of the parties
TERMINATION CLAUSE may give buyer the right to
CLOSE PROCUREMENTS
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96
TERMINATION CLAUSE may give buyer the right to
terminate entire contract or its portion for Cause or
Convenience at any time!
BUT, the buyer may have to compensate the seller for:
1) Sellers preparations, and
2) Any completed and accepted work
UNRESOLVED CLAIMS LEAD TO LITIGATION
AFTER CONTRACT CLOSURE!
PROVIDES value to the performing organization and
CLOSE PROCUREMENTS
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97
PROVIDES value to the performing organization and
the customer and must not be ignored under any
Circumstances
ALL CONTRACTS must be closed out no matter the
circumstances under which they come to an end:
1) Whether completed, or
2) Terminated
CLOSE PROCUREMENTS
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98
UPDATING
RECORDS
To reflect final results
To archive it for future use
Contract performance
Financial closure
Contract file
PRODUCT
VERIFICATION
ADMINISTRATIVE
CLOSURE
Was the work completed
Correctly and Satisfactorily?
Was the product of the
project same as what was
requested?
Does it meet the needs?
Close Procurements process overview
INPUTS
TOOLS &
TECHNIQUES
OUTPUTS
16
99
Procurement
management plan
Procurement
documentation
INPUTS
TECHNIQUES
Procurement
Audits
Negotiated
settlement
Records
management
system
OUTPUTS
Closed Procurements
OPAs updates
Close Procurements
Procurement
INPUTS
17
00
Provides directions for closing
procurements!
Procurement
management plan
Procurement
documentation
Procurement documentation
Consists
1. Contract INPUTS
Close Procurements
17
01
1. Contract
2. Supporting schedules
3. Requested and approved contract changes
4. Seller-developed technical documentation
5. Seller performance reports
6. Financial documents ( invoices, payment
records )
7. Inspection reports concerning the contract
Contract terms may define procedure
for contract closure
and then such procedure has to be followed
Procurement
management plan
Procurement
documentation
INPUTS
Procurement audits
STRUCTURED REVIEW
Of
N
O
T
TOOLS &
TECHNIQUES
17
02
Of
the entire
procurement process
from procurement planning
through contract administration
LESSONS LEARNED
Identify success and failures
that
GUIDE US on other
procurement items
or to other projects within
the performing organization
OBJECTIVE
T
A
U
D
I
T
O
F
C
O
S
T
S
Procurement
Audits
Negotiated
settlement
Records
management
system
Procurement audits
OTHER SPECIAL ACTIVITES:
TOOLS &
TECHNIQUES
17
03
1) Arranging for storage of contract
records and drawings
2) Creating and delivering legal documents
(release of lien documents and formal
acceptance letters)
3) Return of property used on the contract to
its owner
Procurement
Audits
Negotiated
settlement
Records
management
system
Negotiated Settlements
17
04
The final equitable settlement of all outstanding issues,
claims, and disputes by negotiation!
Any matter that can not be settled through direct
negotiation may be resolved by Alternative Dispute
Resolution (ADR), including mediation or arbitration.
Lastly, court of law 9although least desirable option).
Records management
TOOLS &
TECHNIQUES
17
05
Records management
system
We have discussed it already.
Procurement
Audits
Negotiated
settlement
Records
management
system
Closed Procurements
Buyer (through authorized contract
Close Procurements
OUTPUTS
17
06
Buyer (through authorized contract
administrator) gives Formal Written
notice to seller that the contract has
been completed.
Requirements for contract closure
are defined in the contract terms and
conditions and also included in the
contract management plan.
Closed
Procurements
OPAs updates
OPAs updates
1) Contract file
Close Procurements
OUTPUTS
17
07
1) Contract file
IS THE COMPLETE SET of
indexed records including closed
contract, and it
IS MERGED with the final project
records.
Closed
Procurements
OPAs updates
OPAs updates
2) Deliverable acceptance
Written formal notice from buyer to
Contract Closure
OUTPUTS
17
08
Written formal notice from buyer to
seller about deliverables accepted
or not accepted as per contract
terms.
Lessons learned analysis and
process improvement
recommendations for future
procurement management.
Closed Contracts
OPAs updates
17
09
ADMINISTRATIVE
CLOSURE
ADMINISTRATIVE
CLOSURE
CLOSE
PROJECT or Phase
Close Project or Phase Process
17
10
Performing
Close Project portion
Of the project management plan!
17
11
For what?
Finalizing all activities completed across all
PM Process Groups
to
Formally close the project or phase
And transfer the completed project
(or cancelled one) as appropriate.
How do we do it?
17
12
How do we do it?
1) Establish procedures to coordinate activities needed to
verify and document the project deliverables
2) Coordinate and interact to formalize acceptance of
those deliverables by customer/sponsor
3) Investigate and document reasons for actions taken if a
project is terminated before completion
Close Project Process
How do we do it?
17
13
How do we do it?
We develop TWO PROCESSES for this purpose:
Administrative closure procedure
Close procurements procedure
How do we do it?
17
14
How do we do it?
Administrative closure procedure details
- all activities
- interactions, and
- related roles and responsibilities of the project
management team involved in this process
How do we do it?
17
15
How do we do it?
Administrative closure procedure also includes
all activities needed to
- collect project records
- analyze project success or failure
- gather lessons learned, and
- archive project information for future use
How do we do it?
17
16
How do we do it?
Close procurement procedure includes
all activities and interactions needed to
- settle and close any contract done for the project
- define those related supporting activities the formal
administrative closure of the project
How do we do it?
17
17
How do we do it?
Close procurements procedure involves both
PRODUCT VERIFICATION
- all work completed correctly and satisfactorily
ADMINSTRATIVE CLOSURE
- updating contract records to reflect final results
and archiving for future use
Please remember!
17
18
Please remember!
Early termination of the contract is a special case
of Close procurements
May involve:
1) Inability to deliver the product
2) A budget overrun
3) Lack of required resources
Close Project or Phase process overview
INPUTS
TOOLS &
OUTPUTS
17
19
Project Management
Plan
Organizational
process assets
Accepted Deliverables
INPUTS
TOOLS &
TECHNIQUES
Expert Judgment
OUTPUTS
Final product, service
or result transition
Organizational
process assets
(UPDATES)
Close Project process inputs
INPUTS
Project management
17
20
Project Management
Plan
INPUTS
Project management
plan
We have already discussed
about it. We take it as an
important input here.
Close Project or Phase process inputs
OPAs provides
INPUTS
17
21
Project or phase closure
guidelines or requirements
(project audits, project
evaluations, and transitions
criteria).
Historical information and
lessons learned guides
proper closure.
Project Management
Plan
Organizational
process assets
INPUTS
Close Project or Phase process inputs
INPUTS
17
22
Refers to transition of final
product (or case of phase
closure, then intermediate
product).
Project Management
Plan
Organizational
process assets
Accepted
Deliverables
INPUTS
Close Project process tools & techniques
TOOLS &
Expert Judgment
17
23
TOOLS &
TECHNIQUES
Expert
Judgment
Expert Judgment
Applied in developing and
performing Used to both the
administrative closure
procedures.
Administrative closure: Three most important things!
Actions and activities to define the stakeholder Approval
17
24
Actions and activities to define the stakeholder Approval
Requirements for changes and all levels of deliverables
Actions and activities that are necessary to confirm this,
Verify that all deliverables have been PROVIDED AND
ACCEPTED, and validate that completion and exit criteria are met
Actions and activities necessary to satisfy Completion or
Exit criteria for the project
Close Project process outputs
OUTPUTS
Final product, service, or
17
25
OUTPUTS
Final product,
service
or result
Organizational
process assets
(UPDATES)
Final product, service, or
result
Formal acceptance and handover of
the product, service, or result that the
project was authorized to produce.
Receipt of a statement that the terms
and conditions of the contract have
been met!
OUTPUTS
OPAs updates
17
26
OUTPUTS
Final product,
service
or result
Organizational
process assets
(UPDATES)
OPAs updates
Development of the index and
location of project documentation
(using the configuration management
system)
Formal acceptance documentation
Project files
Project closure documentation
Historical information
OUTPUTS
OPAs updates
17
27
OUTPUTS
Final product,
service
or result
Organizational
process assets
(UPDATES)
OPAs updates
formal acceptance documentation
Formal confirmation from customer
or sponsor that customer
requirements and specifications have
been met.
Indicates official acceptance.
OUTPUTS
17
28
OUTPUTS
Final product,
service
or result
Organizational
process assets
(UPDATES)
assets updates
project files
Documents resulting from project
management :
Project management plan, scope,
schedule, cost and quality baselines,
project calendars, risk registers, planned
risk response actions, and risk impact.
OUTPUTS
17
29
OUTPUTS
Final product,
service
or result
Organizational
process assets
(UPDATES)
assets updates
project closure documents
Documents indicating completion of
project and transfer of completed
deliverables to others(operations).
OUTPUTS
17
30
OUTPUTS
Final product,
service
or result
Organizational
process assets
(UPDATES)
assets updates
historical information
Historical information and lessons
learned information are transferred to
the LESSONS LEARNED
KNOWLEDGE BASE for future use!
Professional Responsibility
AS PROJECT MANAGEMENT PROFESSIONAL
We should
17
31
1. ENSURE INTEGRITY
2. CONTRIBUTE TO KNOWLEDGEBASE
3. APPLY PROFESSIONAL KNOWLEDGE /
ENHANCE INDIVIDUAL COMPETENCE
4. BALANCE STAKEHOLDER INTERESTS
5. RESPECT DIVERSITY
We should
17
32
Uphold and Support
the integrity and ethics
of
the profession
OUR ACTIONS must always be
17
33
In line with
Legal requirements
and
Ethical standards
We must always
17
34
Uphold the needs of
the Project Stakeholders
and the part of the Society
impacted by our projects
ENSURE INTEGRITY
Of
17
35
The Project Management Process
The Projects Product
Your own Personal Conduct
ENSURE INTEGRITY
Of
17
36
The Project Management Process
Follow the right process
You must have a charter
You must have a WBS
Project manager must have clear and adequate authority
You should not compromise on applying all the concepts,
tools and techniques we have been discussing about during
this course
ENSURE INTEGRITY
Of
17
37
The Projects Product
A product that has integrity is the one
that is complete and sound, or fit for use.
The correct application of
project management processes
will ensure it.
ENSURE INTEGRITY
Of
17
38
Do not put personal gain over the needs of the project
Tell the truth in reports, conversations and other communications
Follow copyright and other laws
Do not divulge company data to unauthorized parties
Value and protect intellectual property
ENSURE INTEGRITY
Of
17
39
Prevent conflicts of interest or appearance of conflicts of interest
and deal with them as they happen
Do not give or take inappropriate gifts, favors, or bribes
Report violations of regulations, laws, ethics, policies, etc.
Do the right thing and follow the right process
CONTRIBUTE TO KNOWLEDGE BASE
Share lessons learned from the project with others
17
40
Share lessons learned from the project with others
Write articles about project management
Support education of other project managers and
stakeholders about project management.
Coach/mentor other project managers.
CONTRIBUTE TO KNOWLEDGE BASE
Perform research on projects done within your
17
41
organization for the purpose of calculating
performance metrics.
Perform research to discover best practices for
use of project management and share the findings
with other.
APPLY PROFESSIONAL KNOWLEDGE / ENHANCE,
INDIVIDUAL COMPETENCE
17
42
Professional knowledge means knowledge of project
management practices and the technical knowledge
needed to complete the project (specific to the
application area).
Train others to use correct techniques.
Inform stakeholders of correct processes.
APPLY PROFESSIONAL KNOWLEDGE / ENHANCE
Constantly look for new information and practices
17
43
that will help the organization or its projects.
Continue to learn about the industry where you
work.
Stick to the right processes throughout the project.
Enhance individual competence by increasing and
applying professional knowledge to improve
services
APPLY PROFESSIONAL KNOWLEDGE / ENHANCE
17
44
Work to understand your personal strengths
and weaknesses.
Continue to learn.
Plan your own professional development.
BALANCE STAKEHOLDER INTERESTS
Determine and understand the needs and objectives of
all stakeholders.
17
45
all stakeholders.
Actively look for competing or conflicting needs and
interests.
Get the team and stakeholders.
Involved as appropriate and get management involved
when team can not resolve conflicting objectives.
Determine options for fair resolution of conflict.
RESPECT DIVERSITY
Understand cultural differences
17
46
Understand cultural differences
Uncover communication preferences when identifying
stakeholders
Prevent cultural shock by training and advance
research
RESPECT DIVERSITY
Uncover and respect different work ethics and practices
17
47
Uncover and respect different work ethics and practices
of the team members
Provide training to team members from different cultural
backgrounds to help them understand each other
Follow the practices in other countries as long as they
do not violate laws
THE PROJECT MANAGEMENT
WE WISH YOU ALL SUCCESS!
17
48
WE WISH YOU ALL SUCCESS!
AND HOPE
YOU WILL ACHIEVE HIGHER
LANDMARKS!
THE PROJECT MANAGEMENT
17
49
THANK YOU!

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