Download - Pmp prep 5th ed-bmc master-oct 2013
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
PMP® Certification Test PreparationPMBOK® Fifth Edition
Presents
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
The PMP® Certification Test Preparation
Objectives
Provide a framework for structuring the Project Management Body of Knowledge;
Identify the most generally accepted practices within the discipline of project management;
Reveal “Exam Tips”;
Explain how to apply for and take the PMP® exam
Page i
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013Page iii
The World of Business Management Consultants
BristolPhoenix
Chicago
Hong Kong
BeijingShanghai
TokyoTaipeiMilan
Lisbon
Mumbai
WarsawFrankfurt
Houston
Brussels
Istanbul
Singapore
SeoulMoscow
Washington DC
Vancouver
Atlanta
Bristol
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013Page iv
Our Learning Institutions
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Three Day Course Schedule
Page vii
Day Two
Planning Processes (continued)
Practice Test
Executing Processes
Day Three
Monitoring & Controlling Processes
Practice Test
Closing Processes
Professional Responsibility
Preparing for the PMP
Day One
Introduction and overview of PMI, PMP and PMBOK
Initiating Processes
Planning Processes
Sample Test
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Introduction and Overview of the PMP®
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Organization of this Workbook
The PMBOK® Fifth Edition is organized by Knowledge Area.
We believe that people learn the same way they work on-the-job: by project phases.
So, this Test Preparation workbook is organized
chronologically, start to finish, from Initiating a project through to Closing the project.
Page 1
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Planning Processes
Executing Processes
Monitoring & Controlling Processes
Initiating Processes
Page 1
Organization is Chronological
Closing Processes
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
New Test and New PMBOK® Edition
Page 2
The PMBOK® 5th Edition was released in January 2013. The test changed again on July 31, 2013. A new Knowledge Area was introduced: Stakeholder Management.
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Qualification Requirements
A minimum of 4500 hours PM experience within the past 8
years
A minimum of 7500 hours PM experience within the past 8
years
35 contact hours (PDU’s) of PM
education
+ =
Graduate, 4-Year Degree
Non-Graduate, or 2-Year Degree
Eligibility to take the PMP®
examination
Page 2
This Course ID is E1078 and Awards 24 PDU’s
The T&T CD ID is E1091 and Awards 11 PDU’s
PMTestOnline is C4070 and Awards 11 PDU’s
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
PMBOK Fifth Edition and the New Test
The PMBOK Fifth Edition was introduced in January 2013, and the new fifth edition test started on July 31, 2013.
The PMP examination consists of 200 questions, with a four hour time limit
That’s 72 seconds (or 1.2 minutes) per question
This training course will give you everything you need,with a little self-study, to pass the PMP® examination
Visit www.pmi.org, download PMP Certification Handbook
Page 2
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
PMBOK 5th Edition PMP Test Domain Content
Project Initiation 13% Project Planning 24% Project Execution 30%Project Monitoring & Control 25%Project Closing 8%
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To pass, you need to get a minimum of 122
questions correct out of 200 questions (61%)
Pass rate on the 4th Edition test is about 74%
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
http://www.pmi.org/Certification/Project-Management-Professional-PMP.aspxLog in with your User Name and PasswordFollow the instructions
Submit your application to Project Management Institute (PMI)
http://www.pmi.org/info/PDC_PMPHandbook.pdf
PMI ® may audit when you pay your exam fee to PMI. If you cancel or reschedule within 30 days of the test, there is a fee of $70; within 2 days, you forfeit the entire fee.
Control is through audit
Schedule a test date with Prometrichttp://www.prometric.com/PMI/default.htm
Apply to PMI to take the test,
Schedule a date with Prometric
Candidates have three (3) opportunities to pass the exam in one year. If they
do not pass any, they must wait one (1) year from the date of the last attempt.
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PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Types of questions to expect
You are advised that a major purchased part on your projectwill be delayed. What do you do?
A. Ignore it. It will go awayB. Notify your bossC. Let the customer know about it and talk over optionsD. Meet with the team and identify alternatives
Questions requiring experience more than study
D. Meet with the team and identify alternatives
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PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Types of questions to expect
Study show that every time you double the production of“widgets”, unit cost goes down by 10%. Based on the study,the company concludes that the production of 4,000 “widgets”will cost $19,000. This illustrates:
A. Learning curve effectsB. Law of diminishing returnsC. The 80/20 ruleD. Bottoms up cost estimating
Information that does not matter (distractors)
A. Learning curve effects
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PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Types of questions to expect
Questions designed to make you make you think carefully
The theory “optimum quality level is obtained whenIncremental revenue from product improvement equalsincremental cost to secure it” comes from
A. Quality control analysisB. Marginal analysisC. Standard quality analysisD. Conformance analysis
B. Marginal Analysis
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PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Types of questions to expect
Questions using unfamiliar words and expressions
Parking places, corner office/door, and a key to the executivebathroom are example of:
A. PerquisitesB. OverheadC. Herzberg’s motivatorsD. Entitlements
A. Perquisites (aka “Perks”)
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PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Types of questions to expect
Questions requiring understanding of the subject matter
Decomposing deliverables into smaller manageable activitiesIs complete when:
A. Project justification has been establishedB. Change requests have occurredC. Cost and duration estimates can be developed for each work
element at this levelD. Each work element is found in the WBS dictionary
C. Cost and duration estimates can be developedfor each work element at this level
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PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Types of questions to expect
Questions requiring study (memorization) more than experience
Conflict resolution techniques that may be used on a projectinclude:
A. Withdrawing, compromising, controlling, and forcingB. Controlling, forcing, smoothing, and withdrawingC. Confronting, compromising, smoothing, and directingD. Smoothing, confronting, forcing and withdrawing
D. Smoothing, confronting, forcing and withdrawing
Page 5
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Types of questions to expect
New thinking about a known topic
In a matrix organization, information dissemination is mostlikely to be effective when?
A.Information flows both horizontally and verticallyB.The communication flows are kept simpleC.There is inherent logic in the type of matrix selectedD.Project managers and functional managers socialize
A. Information flows both horizontally and vertically
Page 6
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Types of questions to expect
Questions requiring calculation and knowledge of formulae
A project was estimated to cost $1.5 million and scheduled to last six months. After three months, the earn value analysis shows the following:
BCWP (EV) = $650,000BCWS (PV) = $750,000ACWP (AC) = $800,000
What are the schedule and cost variances?
A. SV = +$100,000 - - - CV = +$150,000B. SV = +$150,000 - - - CV = -$100,000C. SV = -$50,000 - - - - CV = +$150,000D. SV = -$100,000 - - - -CV = -$150,000
D. SV=-S100,000 : CV=-$150,000
Page 6
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Types of questions to expect
Questions designed to take up your time
You’ve been engaged to manage a project. The estimated cost of the project is $1,000,000. The project sponsor has approved this amount. Your earned value calculations indicate that the project will be completed on time and under budget by $200,000. Based on your calculation, your personal profit will decrease by $2,000. Given estimated decrease in personal profit, what action should you take?
A. Invoice for the full $1,000,000 based on contract and to cover profitB. Add tasks to improve the outcome and increase the actual project costC. Inform the end-user that you can add features to the project in order to
use the entire budgetD. Communicate the projected financial outcome to the project sponsor
D. Communicate the outcome to the project sponsor
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PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Types of questions to expect
Questions using acronyms you need to understand
There are several different types of network analysis tools for determining critical path. Which method for analysis is also called Method of Moments?
A. GERTB. CPMC. PERTD. Monte Carlo
C. PERT (Program Evaluation and Review Technique)
Extra
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013Page 17
Mapping Process Groups to Knowledge AreasProcess Groups
Knowledge AreasInitiating Planning Executing Closing
Monitoring &
Controlling
4. Project IntegrationManagement
4.2 Develop ProjectManagement Plan
4.3 Direct & Manage 4.4 Mon/Ctrl Proj Work4.5 Perform Integrated
Change Control
5. Project ScopeManagement
5.1
Collect Requirements5.2
Define Scope
5.5 Validate Scope
5.6 Control Scope
6. Project TimeManagement
6.1
Define Activities6.2Sequence Activities6.3Est. Activity ResourcesEst. Activity Durations6.5Dev. Schedule
6.7 Control Schedule
7. Project CostManagement
7.2 Estimate Costs
7.3 Determine Budget
7.4 Control Costs
8. Project QualityManagement
8.1 Plan Quality Mgt. 8.2 Perform Quality
Assurance8.3 Control Quality
9. Project HumanResourceManagement
9.1 Plan Human
Resource Mgt.9.2 Acquire Project Team
9.3 Develop Project Team
9.4 Manage Project Team
10. ProjectCommunicationsManagement
10.1 Plan Communications
Management 10.2 Manage Communications
11. Project RiskManagement
11.1 Plan Risk Management
11.2 Identify Risks
11.3 Perform QualitativeRisk Analysis
11.4 Perform QuantitativeRisk Analysis
11.5 Plan Risk Response
11.6 Control Risks
12. Project ProcurementManagement
12.1 Plan Procurement Mgt. 12.2 Conduct Procurements 12.3 Control Procurements 12.4 Close Procurements
Project Work 4.1 Develop Project Charter
13.1 Identify Stakeholders
5.4 Create WBS
6.4
4.6 Close Project
or Phase
13.3 Manage Stakeholder
Engagement
13.4 Control Stakeholder
Engagement
Plan Scope Mgt.
5.3
Plan Schedule Mgt.
6.6
7.1 Plan Cost Mgt.
10.3 Control Communications
13. Project Stakeholder
Management13.2 Plan Stakeholder
Management
PMBOK 5th Edition,
Table 3-1, Page 61
(47 Processes)
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Mind Maps: Integration
Handout
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Mind Maps: Scope
Handout
Scope
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013Handout
Time
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Mind Maps: Cost
Handout
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Mind Maps: Quality
Handout
Project Quality Management
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Mind Maps: Human Resource
Handout
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013Handout
Communication
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013Handout
Risk
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013Handout
Procurement
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Stakeholders
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
So, what is a project?
• A project is a temporary endeavor undertaken to create a unique product, service or result.
• A program is a group of related projects, subprograms, and program activities managed in a coordinated way to obtain benefits not obtainable from managing them individually.
• A portfolio is a collection of projects, programs, and operations managed as a group to achieve strategic objectives.
• An operation is an organizational function performing the ongoing execution of activities that produce the same product or provide the same repetitive service
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PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Scope(Planned Results)
Resource(Budget)
Schedule(Time)
PMBOK 5th Edition, Page 6The Triple Constraint, plus some.
Page 8
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Organizational Governance: Linkages
Strategic Planning
Management by Projects
Management of
Operations
Portfolio
Management
Program
Management
Project
Management
Processes,
Tools, Metrics
Page 8
PMBOK 5th Edition, Page 7
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Organizational Governance: Linkages
Page 9
Organizational Resources
VISION
Mission
Organizational Strategy & Goals
High-Level Operations Planning
& Management
Project Portfolio Planning &
Management
Management of On-Going Operations
(recurring activities)
(producing value)
Management of Authorized Programs & Projects
(projectized activities)
(increasing value production capability)
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013Page 10
Project Programs Portfolios
Projects have defined objectives. Scope is
progressively elaborated throughout the
project life cycle.
Project managers expect change and
implement processes to keep change
managed and controlled.
Project managers progressively elaborate
high-level information into detailed plans
throughout the project life cycle..
Project managers manage the project team
to meet the project objectives.
Success is measured by product and project
quality, timeliness, budget compliance, and
degree of customer satisfaction..
Project managers monitor and control the
work of producing the products, services,
or results that the project was undertaken to
produce.
Programs have a larger scope and provide
more significant benefits.
Program managers expect change from
both inside and outside the program and
are prepared to manage it.
Program Managers develop the overall
program plan and create high-level plans to
guide detailed planning at the component
level.
Program managers manage the program
staff and the project managers; they
provide vision and overall leadership.
Success is measured by the degree to
which the program satisfies the needs and
benefits for which it was undertaken..
Program managers monitor the progress of
program components to ensure the overall
goals, schedules, budget and benefits of the
program will be met.
Portfolios have an organizational scope
that changes with the strategic objectives
of the organization.
Portfolio managers continuously monitor
changes in the broader internal and
external environment.
Portfolio managers create and maintain
necessary processes and communication
relative to the aggregate portfolio.
Portfolio managers may manage or
coordinate portfolio management staff, or
program and project staff that may have
reporting responsibilities into the aggregate
portfolio.
Success is measured in terms of aggregate
investment performance and benefit
realization of the portfolio.
Portfolio managers monitor strategic
changes and aggregate resources
allocation, performance results, and risk of
the portfolio.
Organizational Project Management
Comparison: Project, Program & Portfolio
Scope
Change
Planning
Management
Success
Monitoring
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
How do projects come about?
Projects can come about in the following ways:
Market demandStrategic opportunitySocial needEnvironmentalCustomer requestTechnological advanceLegal requirement
Page 10
More on selection methods later
PMBOK 5th Edition, Page 10
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
The Project Management Office (PMO)
A PMO is an organizational structure:• standardizes project governance processes,• facilitates the sharing of resources, • develops methodologies, tools and techniques.
Responsibilities can range from providing support functions to direct management of projects.
Projects supported by a PMO may not be related, other than being managed together
Project Manager
focuses on specific project objectives controls assigned project resources manages the constraints
PMOs
manages major program scope changes optimizes shared resources across all projects manages methodologies, standards, overall risk
Page 12
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Types of Project Management Offices (PMO)
• Supportive. Consulting role , e.g., supplying templates, best practices, training, computer information, and lessons learned from other projects. Control from this type of PMO is low.
• Controlling. Provide support and require compliance, e.g., PM methodologies, specific templates-forms-tools, or conformance to governance. Control from this type of PMO is moderate.
• Directive. Control projects by managing projects. Control from this type of PMO is high.
Page 12
ExamTip
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
PBOs can be created by various organizations (functional, matrix, projectized).
They can diminish hierarchy since work is measured by results rather than position or politics.
PBOs do a majority of their work as projects rather than as a function, but can have functional support areas.
Project-Based Organizations (PBO)
Page 13
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Project Managers
Page 15
Role of the Project Manager
Role is to achieve project objectives. Understanding tools and
techniques is not enough. It requires general management
skills, and:
Knowledge of project management,
Performance or accomplishment,
Personal behavior and effectiveness when performing
the project including attitude, personality characteristics,
and leadership.
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
The Role of the PMBOK®
PMBOK® Guide
Project Management
Body of Knowledge
Application Area
Knowledge,
Standards and
Regulations
Interpersonal
Skills
Understanding
the Project
Environment
General
Management
Knowledge and
Skills
Page 15
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Organizational Structures
Project Characteristics
Functional ProjectizedMatrix
Weak Matrix Balanced Matrix Strong Matrix
Little or None
Little or None
Functional Manager
Project Manager’s Authority
Resource Availability
Who Manages the Budget?
Project Manager’s Role
Project Management Administrative Staff
Part-Time
Part-Time
Part-Time
Part-Time
Full-Time Full-Time Full-Time
Part-Time Full-Time Full-Time
Functional Manager
MixedProject
ManagerProject
Manager
Low
Low
Low to Moderate
Low to Moderate
Moderate to High
High to Almost Total
Moderate to High
High to Almost Total
Organizational Structures PMBOK® Fifth Edition, Page 22
Page 16
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Strong matrix: The balance of power rests with the project manager. Weak matrix: The balance of power rests with the functional manager. Balanced matrix: The power is balanced between the functional and the project managers. Tight Matrix: Beware here. It has nothing to do with the matrix organization. It refers to
locating the project team’s offices in the same room. Watch for this one!
Exam questions deal with matrix forms.ExamTip
Organizational Influences PMBOK® Fifth Edition, Page 22
Page 17
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Organizational Structure PMBOK® Fifth Edition, Page 22
Page 18
Chief Executive
FunctionalManager
FunctionalManager
FunctionalManager
Staff
Staff
Staff Staff
Staff
Staff
Staff
Staff
Staff
Staff engaged in project activities
Project Coordination
Functional Organization
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Organizational Structure PMBOK® Fifth Edition, Page 23
Page 18
Weak MatrixChief
Executive
FunctionalManager
FunctionalManager
FunctionalManager
Staff
Staff
Staff Staff
Staff
Staff
Staff
Staff
Staff
Staff engaged in project activities
Project Coordination
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Organizational Structure PMBOK® Fifth Edition, Page 24
Page 19
Balanced MatrixChief
Executive
FunctionalManager
FunctionalManager
FunctionalManager
Staff
Staff
Project Manager
Staff
Staff
Staff
Staff
Staff
Staff
Staff engaged in project activities
Project Coordination
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Manager of Project Managers
Organizational Structure PMBOK® Fifth Edition, Page 24
Page 19
Strong MatrixChief
Executive
FunctionalManager
FunctionalManager
FunctionalManager
Staff
Staff
Staff Staff
Staff
Staff
Staff
Staff
Staff
Staff engaged in project activitiesProject
Coordination
Project Manager
Project Manager
Project Manager
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Organizational Structure PMBOK® Fifth Edition, Page 25
Page 20
ProjectizedChief
Executive
ProjectManager
ProjectManager
ProjectManager
Staff
Staff
Staff Staff
Staff
Staff
Staff
Staff
Staff
Staff engaged in project activitiesProject
Coordination
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Organizational Structure PMBOK® Fifth Edition, Page 26
Page 20
CompositeChief
Executive
FunctionalManager
FunctionalManager
FunctionalManager
Staff
Staff
Staff Staff
Staff
Staff
Staff
Staff
Staff
Staff engaged in project activities Project A Coordination
Manager of Project Managers
Project Manager
Project Manager
Project Manager
Project B Coordination
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
The Organization and it’s Environment
Enterprise Environmental Factors (EEF)EEF are conditions not under the control of the team. They include government or industry standards, organization culture, infrastructure (facilities & equipment), human resources, marketplace conditions, risk tolerance, politics, communication channels, data bases, and PMIS. What is out there?
These are INPUTS to Processes
Page 21
Organizational Process Assets (OPA)OPA are assets available to the project team: (1) processes and procedures, and (2) corporate knowledge bases. They include plans, processes, policies, procedures, lessons learned, historical information, schedules, risk data, and earned value data. What have we got?
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Stakeholders are persons or organizations who may affect, be affected, or perceive that that they are affected by a decision, activity or outcome of the project. They: • May be actively involved in the project or have interests affected by the project, • May exert influence over the project/team to satisfy strategic business objectives.
Project Governance is an oversight function aligned with the organization’s governance model and includes the project life cycle. Governance is alignment of the project with stakeholders’ needs or objectives. It is critical to management of stakeholder engagement, maximizing the value of project outcomes, and aligning projects to the business strategy.
The Project Manager should manage the influences of stakeholders regarding project requirements to ensure successful outcome.
Pages 22-23
Who are your stakeholders? Can you name them? See PMBOK® Fifth Edition, Pages 32-33
Stakeholders
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
The Project Sponsor
The Project Sponsor is the person or group who provides resources and support for the project and is accountable for enabling success. The sponsor promotes the project and serves as spokesperson to management. They play a significant role in project initiation and the development of the initial scope and charter
Page 22
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Starting
a Project
Organizing
and
Preparing
Executing the Work Closing a
Project
Co
st a
nd
Sta
ffin
g L
evel
Time
Project
Charter
Project
Management Plan
Accepted
Deliverables
Archived
Project
Documents
Project Life Cycle
Page 24
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Stakeholders Influence Over Project Performance
Page 24
Value
Time
Concept Planning Execution Close-Out
Amount at Stake
Uncertainty (Risk)
Influence of Stakeholders
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013Page 25
Process Groups are not Project Phases
Phased System Development Life Cycle (SDLC) to Launch
DevelopmentProduction
TechnologyTrials Production
Laboratory
ModelLAUNCHIDEA
Feasibility
Study
INPUTS:
Market Basic Requirements
Knowledge Concept Specification Marketing
Technology Department’s Key Technical Proof of Prototype Beta Test Production Product
Appreciation Expertise Risks Principle Documentation Models Documentation Quantity
Basic Requirements Proof of Prototype Production User Product
Concept Specification Principle Product Documentation Reaction Quantity
Key Risk Beta Test
Assessment Models
OUTPUTS:
Project Phases or Life Cycle(Phase-end reviews of deliverables are called
Stage Gates, Phase Exits, or Kill Points)
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013Page 26
Process Groups are not Project Phases
Process Groups PMBOK® Fifth Edition, Pages 42-43
Links between Process Groups in a Phase
Planning Processes
Executing Processes
Monitoring & Controlling Processes
InitiatingProcesses
ClosingProcesses
Planning Processes
Executing Processes
Planning Processes
Executing Processes
Monitoring & Controlling Processes
Initiating Processes
Closing Processes
Plan Do
CheckAct
Walter Shewhart, modified
by Edwards Deming
ExamTip
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013Page 26
Process Groups are not Project Phases
Begin End
Project Lifecycle
Charter Handover
Phase 1 Phase 2 Phase 3 Phase 4
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Understand the Differences Between: PMBOK Fifth Edition, Pages 42-46
• Phase-to-Phase Relationships
• Predictive Life Cycles
• Iterative and Incremental Life Cycles
• Adaptive Life Cycles
Page 26
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Overview of Project Integration Chapter 4 of the PMBOK®
by Knowledge Area
Page 28
4.1 Develop Project Charter
4.2 Develop Project Management Plan
4.3 Direct and Manage Project Work
4.4 Monitor and Control Project Work
4.5 Perform Integrated Change Control, and
4.6 Close Project or Phase
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Initiating Process Groupby Chronology
Page 31
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013Page 28
Process Groups
Knowledge AreasInitiating Planning Executing Closing
Monitoring &
Controlling
4. Project IntegrationManagement
4.2 Develop ProjectManagement Plan
4.3 Direct & Manage 4.4 Mon/Ctrl Proj Work4.5 Perform Integrated
Change Control
5. Project ScopeManagement
5.1
Collect Requirements5.2
Define Scope
5.5 Validate Scope
5.6 Control Scope
6. Project TimeManagement
6.1
Define Activities6.2Sequence Activities6.3Est. Activity ResourcesEst. Activity Durations6.5Dev. Schedule
6.7 Control Schedule
7. Project CostManagement
7.2 Estimate Costs
7.3 Determine Budget
7.4 Control Costs
8. Project QualityManagement
8.1 Plan Quality Mgt. 8.2 Perform Quality
Assurance8.3 Control Quality
9. Project HumanResourceManagement
9.1 Plan Human
Resource Mgt.9.2 Acquire Project Team
9.3 Develop Project Team
9.4 Manage Project Team
10. ProjectCommunicationsManagement
10.1 Plan Communications
Management 10.2 Manage Communications
11. Project RiskManagement
11.1 Plan Risk Management
11.2 Identify Risks
11.3 Perform QualitativeRisk Analysis
11.4 Perform QuantitativeRisk Analysis
11.5 Plan Risk Response
11.6 Control Risks
12. Project ProcurementManagement
12.1 Plan Procurement Mgt. 12.2 Conduct Procurements 12.3 Control Procurements 12.4 Close Procurements
Project Work4.1 Develop Project Charter
13.1 Identify Stakeholders
5.4 Create WBS
6.4
4.6 Close Project
or Phase
13.3 Manage Stakeholder
Engagement
13.4 Control Stakeholder
Engagement
Plan Scope Mgt.
5.3
Plan Schedule Mgt.
6.6
7.1 Plan Cost Mgt.
10.3 Control Communications
13. Project Stakeholder
Management13.2 Plan Stakeholder
Management
PMBOK® Fifth Edition, Page 61
Initiating
4.1 Develop Project Charter
13.1 Identify Stakeholders
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Initiation results in:
GO
NO GO
DECISION
Initiating Process Group
Page 30
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
4.1 Develop Project Charter
Initiation: Project Integration Management
Outputs
Project charter
Tools & Techniques
Expert judgmentFacilitation techniques
Inputs
Project statement of workBusiness caseAgreementsEnterprise environmental factorsOrganizational process assets
Page 31
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
4.1 Develop Project Charter
Develop Project Charter is the process of developing a document that formally
authorizes the existence of a projectand provides the project manager with the authority to apply organizational resources to project activities.
The project manager is assigned early in the project, during charter development.
ALWAYS before start of planning.
Page 31
ExamTip
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
4.1 Develop Project Charter
Page 32
CustomerRequirements
• Problem
• Opportunity
• Business Need
ProjectInitiation
• Commitment to go ahead
• Project Charter
• Project Manager assigned
Project
Planning
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
4.1 Develop Project Charter
Page 32
Input: Project Statement of Work (SOW)PMBOK® Fifth Edition, Page 68
• States the Business Need and Cost-Benefit analysis in the Business Case. What triggered the project?
• Documents the characteristics of the end product
• Is progressively elaborated throughout the project life cycle
• Includes the Strategic Plan, a factor when making project selection decisions
• Should describe both what the deliverable is and what it is not
• With the project scope statement, the SOW protects against both scope creep and feature creep
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
4.1 Develop Project Charter
Page 33
Input: Business Case, Strategic PlanPMBOK® Fourth Edition, Page 75
Senior management considerseach project’s contribution to thestrategic goals and its alignmentwith the strategic plan beforedeciding to undertake, continue,suspend, or terminate projects
Strategic planning analyzes an organization’s strengths, weaknesses,opportunities, and threats (SWOT) to determine long-range objectives andstrategies for reaching them. Strategic planning often involves predictingfuture trends, including the need for new products and services.
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
4.1 Develop Project Charter
Page 33 & 34
Input: EEF and OPAPMBOK® Fifth Edition, Page 70
Enterprise Environmental Factors (EEF)Factors not under the control of the team that influence orconstrain the charter process. EEF include government or industrystandards, organization infrastructure, marketplace conditions, etc.What is out there?
Organizational Process Assets (OPA)OPA are standard processes, policies, and corporate knowledge:lessons learned, historical information, templates and otherdocuments.What have we got?
These are INPUTS to Develop Charter
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
4.1 Develop Project Charter
Page 35
Output: Project CharterPMBOK® Fifth Edition, Page 71
ExamTip
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
How do projects come about?
SelectedProjects
SuggestedProjects
Project Selection Techniques
Net Present ValueReturn on Investment
Internal Rate of ReturnBenefit/Cost RatioOpportunity Cost
Page 35
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Project selection methods Economic Models
Net Present Value: net economic value (per year) of a project in terms ofpresent-year monies.
A higher overall net present value is better within cash flow constraints.
Expected Present Value: Risk-adjusted NPV
Return on Investment (ROI): income divided by investment.
A higher ROI is better.
Payback Period: the amount of time it will take to recover the cost of the
project. A faster payback period is better.
Internal Rate of Return (IRR) or Hurdle Rate:the rate of return for the investment in theproject. Organizations may have a minimum rateof return (or hurdle rate).
A higher rate of return is better
Page 37
ExamTip
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Project selection methods Economic Models
Return on Investment (ROI) =
Internal Rate of Return (IRR) : Solve the NPV equation for “r” (hurdle rate)when present value of “cash in” equals present value of “cash out” (i.e., at breakeven)
Net Present Value (NPV) =
FV
(1+r)n
Where, FV = Future Valuer = Interest Raten = Number of Time Periods
Average Earnings After Tax
Average InvestmentARR(Accounting Rate of Return)
Benefit Cost Ratio : Benefits should exceed costs. The higher BCR wins.
=
Page 37
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Project selection methods Example Question
ExamTip
Many things on the Exam are not in the PMBOK. A lot of these are cost questions. Only Present Value
shows up on more than one question.
Opportunity Cost:
“A” has NPV of $45K, “B” has NPV of $75K, what is the Opportunity Cost of selecting Project “B”?
Answer: $45K. Opportunity cost is what you gave up when you made your selection
Page 37
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Exercise Net present Value
Page 38
TIME PERIOD (YR) AMOUNT ($)PRESENT VALUE AT 10% INTEREST RATE
1 50 45
2 100 83
3 300 225
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013Page 38
PROJECT A PROJECT BWhich Project
Would You Pick?
Net Present Value
$95,000 $75,000 A
IRR 13% 17% B
Payback Period
16 months 21 months A
Benefit Cost Ratio
2.79 1.3 A
Exercise Accounting Standards
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013Page 39
Project Selection Methods Weighted Scoring
Si = sijwjj = 1
n1) determine the evaluation factors2) assign a numerical weight to each factor3) rate the projects on each criterion4) multiply each rating by its weighting5) total the weighted ratings to compute an overall score6) highest number project wins
Removes personal bias, is more objective, and considers relative importance of different evaluation factors
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013Page 39
$10,000
$12,000
$8,000
$12,000
$10,200}
$10,000}
Forced Choice: Decision makers
choose among alternatives, often by
pair-wise comparisons, selecting the
one preferred and discarding the rest.
Decision Trees: Define all the possible
outcomes, the probability of each, andits value. Choose the best alternative.
Project Selection Methods Decision Models
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
13.1 Identify Stakeholders
Initiation: Project Stakeholder Management
Outputs
Stakeholder register
Tools & Techniques
Stakeholder analysisExpert judgmentMeetings
Inputs
Project charterProcurement documentsEnterprise environmental factorsOrganizational process assets
Page 40
PMBOK® Fifth Edition, Section 13.1, Page 393
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
13.1 Identify Stakeholders
• It is critical for project success toidentify the stakeholders early in theproject, and to analyze their levels of interest, expectations, importance and influence
• Stakeholders should be classified according to their interest, involvement and influence in theproject
Who are your stakeholders? Make sure you can name them?
Page 40
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Stakeholder Analysis Tools and Techniques
Pages 42 and 43
Position people on the Power/Influence Grid
Think about who is essential for support:
Who are the most influential people? How much will your project affect them? How are they likely to react to your project?Who is effected by the project’s objectives?
Think about how to identify all stakeholders:
Brainstorming (free or structured) Interviews Past Utilize the project team
Develop, Monitor, Focus, Stabilize
Influence
high
medium
low
ChangeAgent
BystanderResistor
Pow
er
LÖ
BG
AR
GU
JH
CF
AB
Note: The 5th Edition lists several classification models:• Power/Interest Grid• Power/Influence Grid• Influence/Impact Grid• Salience Model
Understand the similarities and differences.
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Planning Process Group
Page 45
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013Page 28
Process Groups
Knowledge AreasInitiating Planning Executing Closing
Monitoring &
Controlling
4. Project IntegrationManagement
4.2 Develop ProjectManagement Plan
4.3 Direct & Manage 4.4 Mon/Ctrl Proj Work4.5 Perform Integrated
Change Control
5. Project ScopeManagement
5.1
Collect Requirements5.2
Define Scope
5.5 Validate Scope
5.6 Control Scope
6. Project TimeManagement
6.1
Define Activities6.2Sequence Activities6.3Est. Activity ResourcesEst. Activity Durations6.5Dev. Schedule
6.7 Control Schedule
7. Project CostManagement
7.2 Estimate Costs
7.3 Determine Budget
7.4 Control Costs
8. Project QualityManagement
8.1 Plan Quality Mgt. 8.2 Perform Quality
Assurance8.3 Control Quality
9. Project HumanResourceManagement
9.1 Plan Human
Resource Mgt.9.2 Acquire Project Team
9.3 Develop Project Team
9.4 Manage Project Team
10. ProjectCommunicationsManagement
10.1 Plan Communications
Management 10.2 Manage Communications
11. Project RiskManagement
11.1 Plan Risk Management
11.2 Identify Risks
11.3 Perform QualitativeRisk Analysis
11.4 Perform QuantitativeRisk Analysis
11.5 Plan Risk Response
11.6 Control Risks
12. Project ProcurementManagement
12.1 Plan Procurement Mgt. 12.2 Conduct Procurements 12.3 Control Procurements 12.4 Close Procurements
Project Work4.1 Develop Project Charter
13.1 Identify Stakeholders
5.4 Create WBS
6.4
4.6 Close Project
or Phase
13.3 Manage Stakeholder
Engagement
13.4 Control Stakeholder
Engagement
Plan Scope Mgt.
5.3
Plan Schedule Mgt.
6.6
7.1 Plan Cost Mgt.
10.3 Control Communications
13. Project Stakeholder
Management13.2 Plan Stakeholder
Management
PMBOK® Fifth Edition, Page 61
Planning
4.2 Develop Project Management Plan5.1 Plan Scope Management5.2 Collect Requirements5.3 Define Scope5.4 Create WBS6.1 Plan Schedule Management6.2 Define Activities6.3 Sequence Activities6.4 Estimate Activity Resources6.5 Estimate Activity Durations6.6 Develop Schedule 7.1 Plan Cost Management7.2 Estimate Costs7.3 Determine Budget8.1 Plan Quality Management9.1 Plan Human Resource Management10.1 Plan Communications Management11.1 Plan Risk Management11.2 Identify Risks11.3 Perform Qualitative Risk Analysis11.4 Perform Quantitative Risk Analysis11.5 Plan Risk Response12.1 Plan Procurement Management13.2 Plan Stakeholder Management
24 Plans
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Although the constraints of text and page layout force us todepict the planning process as a linear sequence of activities, thisis not true and probably should not be practiced as such in reality.Planning is, in fact, an iterative activity. The various planningprocesses interact with each other; later processes may cause youto rethink the execution and output of earlier processes.
Replanning at phase gates is called “progressive elaboration” or“rolling wave planning.”
Planning is done by the Project TeamExamTip
Planning is Iterative
Page 45
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Don’t over-plan and don’t under-plan(Your challenge is to match the degree of planning to the demands of the project).
Document, distribute, and maintain the plan(You’re not the only one who is going to use the plan)
Page 46
Project Planning
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
4.2 Develop Project Management Plan
Planning: Integration Management
Outputs
Project management plan
Tools & Techniques
Expert judgmentFacilitation techniques
Inputs
Project charterOutputs from other processesEnterprise environmental factorsOrganizational process assets
Page 47
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
4.2 Develop Project Management Plan
Develop Project Management Plan is the process of defining, preparing, and coordinating all subsidiary plans and integrating them into a comprehensive project management plan.
It is the central document that defines the basis of all project work.
Page 47
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Plan Scope Management Collect Requirements Define Scope Create WBS Plan Schedule Management Define Activities Sequence Activities Estimate Activity Resources Estimate Activity Durations Develop Schedule Plan Cost Management Estimate Costs
Determine Budget Plan Quality Management Plan Human Resource Management Plan Communications Management Plan Risk Management Identify Risks Perform Qualitative Risk Analysis Perform Quantitative Risk Analysis Plan Risk Response Plan Procurement Management Plan Stakeholder Management
The other 23 planning processes are integrated to create the projectmanagement plan. Updates to any plans require an update to the PM plan. Thinkof the PM plan as a bucket into which all the other plans “drip” until it is full.
Input: Outputs from Other Processes
Output: The PM Plan
The Project Management Plan
Pages 45 & 49
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Subsidiary Plans
The Project Management Plan
Page 49
Documents that flow from these planning processes are called Subsidiary Plans. These documents, also controlled by the Integrated Change Control process.
• Process Improvement Plan• Human Resource Plan• Communications Management Plan• Risk Management Plan• Procurement Management Plan• Stakeholder Management Plan
• Scope Management Plan• Requirements Management Plan• Schedule Management Plan• Cost Management Plan• Quality Management Plan
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Differentiation: PM Plan and Project DocumentsProject Management Plan Project Documents
Change management plan Activity attributes Project staff assignments
Communications management plan Activity cost estimates Project statement of work
Configuration management plan Activity duration estimates Quality checklists
Cost baseline Activity list Quality control measurements
Cost management plan Activity resource requirements Quality metrics
Human resource management plan Agreements Requirements documentation
Process improvement plan Basis of estimates Requirements traceability matrix
Procurement management plan Change log Resource breakdown structure
Scope baseline• Project scope statement• WBS• WBS dictionary
Change requests Resource calendars
Quality management plan Forecasts• Cost forecast• Schedule forecast
Risk register
Requirements management plan Issue log Schedule data
Risk management plan Milestone list Seller proposals
Schedule baseline Procurement documents Source selection criteria
Schedule management plan Procurement statement of work Stakeholder register
Scope management plan Project calendars Team performance assessments
Stakeholder management plan Project charterProject funding requirementsProject scheduleProject schedule network diagrams
Work performance dataWork performance informationWork performance reports
Page 50
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
5.1 Plan Scope Management
Planning: Project Scope Management
Outputs
Scope management planRequirements management
plan
Tools & Techniques
Expert judgmentMeetings
Inputs
Project management planProject charterEnterprise environmental factorsOrganizational process assets
Page 51
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Project Scope Management
Ensures that the project includes all the work required, and only the work required, for the project to complete successfully. It defines and controls what is and is not in the project (the positive and negative scope items).
If it is not in the scope, it is not in the WBS
The Scope Baseline includes:1. Project scope statement (SOW)2. Work breakdown structure (WBS)3. WBS dictionary
Page 51
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Plan Scope Management
5.1.1 Inputs
+
Outputs of Previous Processes:
Project Management Plan
Project Charter
Always Inputs:
EEF
OPA
Page 52
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Plan Scope Management
5.1.3 Outputs
Scope Management Plan Part of the project management plan Defines how the scope will be defined, developed,
controlled, and verified.
Requirements Management Plan Also part of the project management plan Describes how requirements will be analyzed,
documented, and managed Includes configuration management, requirements
prioritization, metrics, and traceability.
Page 53
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
5.2 Collect Requirements
Planning: Scope Management PMBOK® Fifth Edition, Section 5.2, Page 110
Outputs
Requirements documentationRequirements traceability
matrix
Tools & Techniques
InterviewsFocus GroupsFacilitated Workshops Group Creativity TechniquesGroup Decision Making
TechniquesQuestionnaires and SurveysObservationsPrototypesBenchmarkingContext DiagramsDocument Analysis
Inputs
Scope Management PlanRequirements Management
PlanStakeholder Management PlanProject CharterStakeholder Register
Page 54
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
5.2 Collect Requirements
Collecting Requirements is the process of determining, documenting, and managing stakeholders needs and requirements to meet project objectives
Requirements include the quantified and documented needs and expectations of the sponsor, customer and other stakeholders
Requirements must be detailed enough to allow precise measurements during Project Execution.
Tools and Techniques
InterviewsFocus GroupsFacilitated Workshops Group Creativity TechniquesGroup Decision Making TechniquesQuestionnaires and SurveysObservationsPrototypesBenchmarkingContext DiagramsDocument Analysis
Page 48
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
5.2.1 Collect Requirements
Interviews: talk with all stakeholders, checklists
Focus groups: talk with prequalified stakeholders
Facilitated workshops: allow key cross-functional stakeholders to define product/project features and to reconcile differences.
Joint Application Design/Development (JAD): software
Quality Function Deployment (QFD): new products, manufacturing
Voice of the Customer (VOC): when QFD collects client needs
Group creativity techniques (see list on next page)
Group decision making techniques
Questionnaires and surveys: written sets of questions
Observations: job shadowing
Prototypes: working model
Benchmarking: comparing to best practices
Context Diagrams: a scope model
Document Analysis: analyzing existing documentation
Pages 55-57
Tools and Techniques to define features and functions
ExamTip
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
5.2.2 Collect Requirements
Page 56
Tools and Techniques: Group Creativity Techniques
Brainstorming: a technique to generate multiple ideas on requirements. Does not include voting or prioritization., but is often used with creative methods that do.
Nominal Group enhances brainstorming with a voting process
Technique: to rank the best ideas.
Delphi Technique: questionnaires are sent to experts: anonymous. responses are compiled, prioritized, and sent back.A method for building consensus.
Idea/Mind Mapping: a graphical method to consolidate brainstorm ideas show commonality and differences: generate new ideas
Affinity Diagram: gathering lots of ideas and sorting them into groupsanalyze to identify patterns within data
Multicriteria Decision uses a decision matrix to establish criteria (risk,
Analysis: uncertainty, valuation), evaluate, and rank many ideas.
ExamTip
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
5.2.2 Collect Requirements
Page 57
Tools and Techniques: Group Decision-Making Techniques
Unanimity: everyone agrees. Example: Delphi Technique.
Majority: more than 50% agree.
Plurality: largest block in the group decides.
Dictatorship: one person decides. Example: Forced Choice.
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
5.2.3 Collect Requirements
Page 58
Outputs
Requirements progressively elaborated
Documentation: record: how each requirement meets the business need. explicit, measurable, accepted in writing
Traceability Matrix: a table linking requirements to their origintraces then over the project life cycle a structure for managing scope changes
Example Requirements Traceability Matrix
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
5.3 Define Scope
Planning: Scope Management PMBOK® Fifth Edition, Section 5.3, Page 120
Outputs
Project scope statementProject documents updates
Tools & Techniques
Expert judgmentProduct analysisAlternatives generationFacilitated workshops
Inputs
Scope management planProject charterRequirements documentationOrganizational process assets
Page 59
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
“... process required to ensure that the project includes all the work required, and only the work required, to complete the project successfully. Documents the features and functionality of the product, service, or result”
ExamTip
• Know and understand for exam
• Objectives = Agreement by all parties
• PMI-ism: give customer “No more - No less”
• Controls what IS and what IS NOT in project
ExamTip
• Giving the customer more than they ask for is “Gold Plating”. PMI® does not approve of Gold Plating.
• Currently only 26% of projects succeed, concentrate on doing the agreed scope of work.
• You may see a variety of questions relating to this in Scope and Quality areas.
5.3 Define Scope
Page 59
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Requirements vs. Scope PMBOK Fifth Edition, Page 121
Not all of the requirements identified in “Collect Requirements” may be included in “Define Scope.”
“Define Scope” selects the final project requirements.
Scope is progressively elaborated. Detailed scope is determined one iteration at a time.
ExamTip
Page 60
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
5.3.1 Define Scope
Pages 60 & 61
Inputs
o Prerequisites are the project
statement of work (SOW) and the
business case (need for the project
and cost/benefit analysis
o Project purpose or justification
o Measurable objectives
o Assigned project manager, authority
and responsibility
o High-level requirements, project
description, and risks
o Summary budget and milestones
o Critical success factors
o Functional organizations and their
participation
o Name and authority of sponsor
+
+
Outputs of Previous Processes:
• Scope Management Plan
• Requirements Documentation
Always an Input:
OPA
There have been as many as 20 “Input, Tools, and Output” questions on past tests (10%). We want you to get these right!
(One person had 40 ITO questions on his test)
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
5.3.2 Define Scope
Page 61
Tools and Techniques
+
+
Almost always a Tool:
• Expert Judgment
• Product Analysis
Translate objectives into deliverables
• Facilitated Workshops
key players reach understanding of the project objectives and their limits.
• Alternatives Generation
develop options using brainstorming, lateral thinking, alternatives analysis, etc.
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
5.3.2 Define Scope PMBOK Fifth Edition, Section 5.3, Page 122
Page 61
Tools and Techniques: Product Analysis, Value Analysis Example
Cost/Benefit Analysis
Benefits:increased revenuecapital assetsregulatory compliancestrategic positioning
Costs:liquid assets consumedresources occupieddeferred opportunities
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
5.3.3 Define Scope PMBOK Fifth Edition, Section 5.3, Page 123
Page 62 & 63
Outputs
+
Subject matter document:
• Project Scope Statement
• Documents Updates: Stakeholder register Requirements docs Traceability matrix
Includes
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
5.3.3 Define Scope
Remember the difference between the Charter and the Scope Statement:
• the charter contains high-level information, • the scope statement is a detailed description
of the scope elements.
Page 62
Both are progressively elaborated throughout the project
See table 5-1, PMBOK Fifth Edition, Section 5.3, Page 124
ExamTip
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
5.3 Define Scope
Sponsor
ProjectManager
Charter
ScopeStatement
Product scope descriptionAcceptance criteriaDeliverablesProject exclusionsConstraintsAssumptions
Summary
High level
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
5.4 Create WBS
Planning: Scope Management
Outputs
Scope baselineProject document updates
Tools & Techniques
DecompositionExpert judgment
Inputs
Scope management planProject scope statementRequirements documentationEnterprise environmental factorsOrganizational process assets
Page 64
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
5.4 Create WBS
The Work Breakdown Structure is the process of subdividing project deliverables into smaller, more manageable components.
It is a hierarchical decomposition of the total scope of work done by the project team to satisfy the objectives and create the deliverables.
If it is not in the scope, it is not in the WBS, and vice versa. This is called the 100% rule.
The Scope Baseline includes:1. Project scope statement (SOW)2. Work breakdown structure (WBS)3. WBS dictionary
Page 64
ExamTip
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
5.4 Create WBS PMBOK® Fifth Edition, Page 129
City Gentrification
LandscapingTree PlantingPreparation
Mark Holes
DigHoles
Plant Trees
Fill Holes
Lay TurfWater
Soil
• At the lowest level of the WBS, work can be properly scheduled, cost estimated, monitored and controlled
• The WBS is critical to project successThe WBS is very important
• The lowest level WBS components arecalled Work Packages
Page 67
Work Packages
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
5.4.1 Create WBS PMBOK® Fifth Edition, Page 127
Inputs
+
Page 65
Outputs of Previous Processes:
• Scope Management Plan
• Project Scope Statement
• Requirements Documentation
Always Inputs:
• EEF (industry WBS standards)
• OPA (procedures, templates, lessons
learned, files)
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
5.4.2 Create WBS PMBOK® Fifth Edition, Page 128
Tools and Techniques
Decomposition
Decomposition is the subdivision of deliverables into smaller, more
manageable components until they are defined to the work packagelevel, where schedule and cost can be reliably estimatedwithout going to level that takes more effort to administer than isworthwhile.
Decomposition may be difficult for work to be done far in the future,
so the team does rolling wave planning.
Parts of the WBS done by a supplier are known as the contract work
breakdown structure (CWBS). Each component in a WBS should beassigned to a department, and sorting by organizational unit creates
an Organizational Breakdown Structure (OBS).
Page 66
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
5.4.2 Create WBSTools and Techniques
Page 67
001
400300200100
210 220 230 240 250 310 320 330 410 420
221 222 231 251 252 321 322 411 412
Whole Project
Main Divisions
Activity Deliverables
Work Packages
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
5.4.2 Create WBSTools and Techniques: Example
Page 67
Study Concept Prototype Qualification
Typical
Project
Pilot Production Project Management
Chronological
SalesProduct
EngineeringPurchasing
Quality Control
Typical
Project
Job ShopManufacturing
DepartmentProject
Management
Functional
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
5.4.2 Create WBSTools and Techniques: Example of WBS by Phase
Page 68
Seagram MIS
Project
Functional Requirements
Definition
Project Definition Analysis Design Construction Implementation Support
Project Management
Process & Package
Evaluation
Analysis Check Point
Design & Integration
Installation
Design Check Point
User Procedures &
Training
Program Generation & Testing
Development Sign Off
Training & User Acceptance
User Sign Off
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
5.4.2 Create WBS PMBOK® Fifth Edition, Page 131-132
Outputs
Work not included in the WBS is outside the scope of the project.This is called the 100% rule.
People who do the work must create their part of the WBS.
The work breakdown structure is a KEY document. It provide forhierarchical summation of cost, schedule and resourceinformation, sometimes called “rolling up the WBS.”
Rules of thumb are applied to the size of a work package:the 80-hour and 2-week rules.
Include all project work and all aspects of the project deliverables.Remember, the scope of the project is always greater than thescope of the product alone!
Heuristics
Page 69
ExamTip
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
5.4.2 Create WBSOutputs, example of software to create WBS
Page 70
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5.4.2 Create WBSOutputs, The WBS Dictionary, PMBOK Fifth Edition, Page 132
Page 70
Project Title: ___________________________________ Task Title: ___________ Charge Number: ___________Task Leader: _______________Department: ________________Project Manager: ____________
Task: Scheduled Start: _____ Scheduled Completion: _____Description: _____________________________________________________________________________________________________________________________________________________________________________
End Requirements: _________________________________________________________________________________________________________________________
Budget:Labor Hours Other Direct
_____________ ________ __________________________________ ________ __________________________________ ________ _____________________
Work Package Completed: _______________________
Hours Expended: ________ Date Completed: ______
WBS Dictionary
• Controls what work is done, when, by whom, for how much.
• Created with help of the team member.
Creating a WBS(Post-It Note Process)
Task “A” Specs. & Req.
Start Date Stop Date
Est. HoursWho?
= Task Description
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
5.4.2 Create WBSDo not confuse WBS with other breakdown structures
Page 71
WBS: a deliverable-oriented hierarchical decomposition of the work tobe executed by the project team to accomplish project objectives andto create required deliverables.
OBS: Organizational Breakdown Structure: a hierarchical view of theproject organization showing how work packages relate to functionaldepartments in the performing organization, i.e., a departmentalbreakdown for the project.
BOM: Bill of Material: a hierarchical tabulation of parts to fabricate amanufactured product.
RBS: Risk Breakdown Structure: a hierarchical depiction of identifiedrisks arranged by risk category.
Resource Breakdown Structure (another RBS?): a hierarchical view ofresources by type used on the project.
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
5.4.2 Create WBSOBS: Organizational Breakdown Structure
Page 71
Project
Design Production
Comp. #2Comp. #1Comp. #2Comp. #1
Co
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Engi
nee
rin
gM
anu
fact
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ng
Ass
emb
lyP
arts
Elec
tric
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Account
Cost Account
Cost Account
Cost Account
Cost Account
Cost Account
Cost Account
Cost Account
Cost Accounts provide a way to control how functional organizations to charge to projects.
WBS Codes show functional managers exactly what their people are doing on the project.
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
5.4.2 Create WBSOutputs
Page 72
Phrases about WBS that have been answers on the exam:
Graphical picture of the project
Identifies all tasks
Foundation upon which the project is built
Is VERY important
Forces you to think through all aspects of the project
A WBS can be re-used for other projects
ExamTip W.B.S.
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
5.4.2 Create WBSOutputs, WBS
Page 72
• The structure of the WBS should reflect the way the project work will be performed and managed
• The WBS should be broken down to the level of detail needed to provide control of the work (80 hour and 2 week rules)
• Smart PM’s know they need to manage the pieces, not the whole project.
• Each element of the WBS should be given a unique identifier that codes its position in the WBS and any parent/child relationship among WBS elements
• Each WBS element should have an associated deliverable or set of deliverables that allow an indication of work progress and completion
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
5.4.2 Create WBSWBS Terminology
Page 73
Chart of Accounts: a numbering system used to monitor costs by category (e.g., labor, supplies, travel)
Code of Accounts: The collection of unique identifiers for each WBS element
Cost Account: A code that allows a functional group to charge for work on a specific element of project work
Work Order: A request for a functional group to work on a specific element of a project
Work Package: An element of work or deliverable at the lowest level of the WBS (relates to tasks or activities on most projects) -- may be subdivided into tasks or activities by team members on larger projects.
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
6.1 Plan Schedule Management
Planning: Project Time Management
Outputs
Schedule management plan
Tools & Techniques
Expert judgmentAnalytical techniquesMeetings
Inputs
Project Management PlanProject CharterEnterprise environmental factorsOrganizational process assets
Page 74
PMBOK Fifth Edition, Page 145
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
6.1 Plan Schedule Management
Plan Schedule Management is the process of establishing policies, procedures, and documentation for planning, developing, managing, executing and controlling the project schedule.
It defines how schedule contingencies will be reported and assessed.
Page 74
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
6.1.1 Plan Schedule Management
Page 74
Inputs
+
Outputs of Previous Processes:
• Project Management Plan (includes the Scope Baseline)
• Project Charter
Always Inputs:
• EEF (resource availability, scheduling
tool, commercial databases)
• OPA (reporting tools, lessons
learned, control tools, closure)
PMBOK® Fifth Edition, Page 146
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
6.1.2 Plan Schedule Management
Page 75
Tools and Techniques
• Expert Judgment
• Analytical Techniques(techniques to estimate and schedule the project, PM software, fast track or crash, risk assessment)
• Meetings(to develop the plan)
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
6.1.3 Plan Schedule Management
Page 76
Outputs
• Schedule Management Plan(model development, accuracy, units, procedures, control thresholds, performance measurement rules, report formats, process descriptions)
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
6.2 Define Activities
Planning: Project Time Management
Outputs
Activity listActivity attributesMilestone list
Tools & Techniques
DecompositionRolling wave planningExpert judgment
Inputs
Schedule Management PlanScope baselineEnterprise environmental factorsOrganizational process assets
Page 77
PMBOK® Fifth Edition, Page 149
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Activity definition identifies specific actions at the work package level of the
WBS to produce the deliverables. Work packages have smaller elementscalled schedule activities that have to be planned, i.e., estimated, scheduled,executed and monitored & controlled, to meet project objectives.
The best way to think about activity definition is that the outputs are
ACTIONS to be done.
6.2 Define Activities
Page 77
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
6.2 Define Activities
City Gentrification
LandscapingTree PlantingPreparation
Mark Holes
DigHoles
Plant Trees
Fill Holes Lay TurfWater
Soil
Page 80
Check groundMeasure distancesNail stakes…
Actions
Work Packages
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
6.2.1 Define ActivitiesInputs
Page 78
+
Outputs of Previous Processes:
• Schedule Management Plan
• Scope Baseline (Scope Statement, WBS, and WBS Dictionary)
Always Inputs:
• EEF (culture, commercial databases,
PMIS)
• OPA (lessons learned, processes,
templates, activity procedures)
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
6.2.2 Define ActivitiesTools and Techniques
Page 78
• Decomposition Subdividing work packages into actions or work effort
necessary to complete the deliverable of the work package.
These actions or work effort are sometimes called “schedule activities.”
• Rolling Wave Planning(see next page)
• Expert Judgment (Always a tool)
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Rolling Wave Planning
Rolling wave planning is progressive elaboration of the plan throughout theproject life cycle. Work accomplished in the near term is planned in detail ata low level of the WBS, while work far in the future is planned at a higherlevel of the WBS. Therefore, schedule activities can exist at various levels inthe project life cycle. For example, in the initiation stage where strategicplanning is done, activities might be kept at the milestone level. As eachproject phase is completed, rolling wave planning means that the next phasecan now be planned in more detail as more is known about the detailactivities.
6.2.2 Define ActivitiesTools and Techniques
Page 78 & 79
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
6.2.1 Define ActivitiesDefinitions
Sometimes PMP Candidates do not understand the subtle distinction between an Activity Definition and a Work Breakdown Structure (WBS). This may help:
Activity Definition Outputs are ACTIONS TO BE DONE
W.B.S. Outputs are DELIVERABLES (Tangible Items)
ExamTip
Page 79
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
City Gentrification
LandscapingTree PlantingPreparation
Mark Holes
DigHoles
Plant Trees
Fill Holes Lay TurfWater
Soil
1. Check ground2. Measure distances3. Nail stakes…
Page 80
Activity List
6.2.3 Define ActivitiesOutputs
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
6.3 Sequence Activities
Planning: Time Management
Outputs
Project schedule network diagrams
Project documents updates
Tools & Techniques
Precedence diagramming method (PDM)
Dependency determinationLeads and lags
Inputs
Schedule management planActivity listActivity attributesMilestone listProject scope statementEnterprise environmental factorsOrganizational process assets
Page 82
PMBOK® Fifth Edition, Page 153
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Activity Sequencing
Activity sequencing means identifying and documenting logical relationshipsamong project activities. Think NETWORKS !
Accurate and complete activity sequencing is critical to developing schedules.Schedule activities (actions) can be sequenced to develop the project schedule.
The project planning team should work together to clarify the sequence ofactivities and dependencies. It is usually more effective to have the team dosome form of manual activity sequencing before turning to projectmanagement software for scheduling.
6.3 Sequence Activities
Page 82
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
6.3 Sequence Activities
Activities are commonly sequenced using the Precedence Diagramming Method (PDM) which allows finish-to-start, finish-to-finish, start-to-start and start-to-finish
Finish-to-start is the most common type of relationship There are three types of dependencies – mandatory
dependencies, discretionary dependencies and external dependencies
Lead and lag times add realism to the schedule (you Lead In to fast track, and Lag out to add a gap between activities)
Page 82
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
6.3.1 Sequence ActivitiesInputs
Page 83
• Schedule Management Plan
• Activity List (activities or actions to be sequenced)
• Activity Attributes (activities have durations, resources, and costs associated and are used for schedule development)
• Milestone List (A significant event in a project. The list identifies all milestones and if they are mandatory (contractual) They have zero duration.
• Project Scope Statement
• EEF and OPA
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
6.3.2 Sequence ActivitiesTools and Techniques, Precedence Diagramming Method (PDM)
Page 84
Dependencies used in PDM
F-F
S-S
S-F
Activity A Activity B
Activity C
Activity D
Activity E
F-S
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
6.3.2 Sequence ActivitiesTools and Techniques, Precedence Diagramming Method (PDM)
also called Activity on Node
Page 84
Finish-to-Start (most often used)Finish-to-FinishStart-to-StartStart-to-Finish (rarely used)
Start Finish
A B C
D E F
• No repetitive activities or conditional loops! No Dummies!• Often used for Three Point Estimates (PERT) and Critical Path Method
(CPM) analysis
A-B; B-C; etc.B-EB-DF-C
Lead inLag out
ExamTip
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
6.3.2 Sequence ActivitiesTools and Techniques, Arrow Diagramming Method (ADM)
also called Activity on Arrow [ Not in Fifth Edition, may be on test ]
Page 85
• Finish-to-Start only (need additional nodes for leads and lags)• No repetitive activities or conditional loops• May use “dummy” activities • Nodes numbered, activities lettered, numbers above arrows are duration• Often used for Three Point Estimates (PERT) and Critical Path Method
(CPM) analysis
1Start Finish
B
C
D
E
2
4 5
3
ExamTip
6
F
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6.3.2 Sequence ActivitiesTools and Techniques, Conditional Diagramming Method
Graphical Evaluation and Review Technique (GERT)
Not in Book
• Allows repetitive activities (looping back) and conditional branches• Combines features of flow diagrams and decision tree models
Manufacture Inspect
Rework Inspect
Package
Scrap
Ship
Not in the Fifth Edition, But has been on recent tests
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
6.3.2 Sequence ActivitiesTools and Techniques, Dependency Determination
Page 86
Mandatory Dependencies (Hard Logic):
Dependencies based on technological constraints, such as not being able to paint a wall before it is constructed
Discretionary Dependencies (Soft Logic):
Dependencies based on management preference, such as delaying one task until another is completed in order to use the same resources on both.
External Dependencies:
Dependencies based on external constraints such as a required inspection before proceeding to the next activity.
Internal Dependencies:
Dependencies within the project team’s control, such as not testing a product until the product is fully assembled.
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Applying Leads and Lags
A lead allows acceleration of the successor activity (you
“lead in” to fast track a project).For example, a team of technical writers can begin writing thesecond draft of a large document 15 days before they finishthe first draft. When scheduling, this is accomplished with afinish-start relationship and a 15 day lead time.
A lag directs a delay in the successor activity (you “lag out” to
allow a waiting time).For example, you have to wait 10 days to discover infantmortality of new semiconductor chips. This is accomplishedusing a finish start relationship and a 10 day lag time.
ExamTip
6.3.2 Sequence ActivitiesTools and Techniques
Page 87
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6.3.2 Sequence Activities
o A hammock is a summary level activity representing a group of related activities
o A subnet or fragnet is a sub-project of a larger network diagram
o A hanger is an unintentional break in the network diagram usually due to omitting either activities or logical relationships
Tools and Techniques
Page 87
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
6.3.3 Sequence ActivitiesOutputs
Page 88
• Project Schedule Network Diagrams (a graphical representation of activities showing dependencies)
• Project Documents Updates (include activity lists and attributes, milestone list, and risk register)
F-F
S-S
S-F
Activity A Activity B
Activity C
Activity D
Activity E
F-S
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
6.4 Estimate Activity Resources
Planning: Time Management
Outputs
Activity resource requirements
Resource breakdown structure
Project documents updates
Tools & Techniques
Expert judgmentAlternative analysisPublished estimating dataBottom-up estimatingProject management software
Inputs
Schedule management planActivity listActivity attributesResource calendarsRisk registerEnterprise environmental factorsOrganizational process assets
Page 89
PMBOK® Fifth Edition, Page 160
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
6.3 Estimate Activity Resources
Estimate Activity Resources is the process of estimating the type and quantities of material, human resources, equipment or supplies required to perform each activity.
There are five tools and techniques:• Expert judgment• Alternative analysis• Published estimating data• Bottom-up estimating• Project management software
Page 89
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
6.3.1 Estimate Activity ResourcesInputs
Pages 89-90
• Schedule Management Plan
• Activity List (Activities that need resources)
• Activity Attributes (data for estimating resources)
• Resource Calendars (periods when resources are available and skill level)
• Risk Register (shows events that impact resource availability)
• Activity Cost Estimates
• EEF and OPA
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
6.3.1 Estimate Activity Resources
Page 78
Resource calendars document the time periods wheneach team member can work on the project. To do thiswe must have a good understanding of the person’sschedule conflicts, including holiday time andcommitments to other projects. We document activeand idle time for each person over the life of the projectand show the results in a project histogram. Resourcesinclude people, material, equipment and facilities.
Inputs, Resource Calendars
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
6.3.2 Estimate Activity ResourcesTools and Techniques
Pages 90-92
• Expert Judgment
• Alternative Analysis (Different people, skills, equipment, tools, make-buy)
• Published Estimating Data (data for estimating resources)
• Bottom-Up Estimating (Estimating at the bottom level of the WBS and adding [aggregating] to the top. Yields best accuracy)
• Project Management Software (a scheduling tool helps plan, manage resource pools, and develop resource estimates)
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Project Title: ___________________________________
Task Title: ___________ Charge Number: ___________Task Leader: _______________Department: ________________
Project Manager: ____________
Task: Scheduled Start: _____ Scheduled Completion: _____
Description: ___________________________________
______________________________________________
______________________________________________
______________________________________________
End Requirements: _____________________________
______________________________________________
______________________________________________
Budget:
Labor Hours Other Direct
_____________ ________ _____________________
_____________ ________ _____________________
_____________ ________ _____________________
Work Package Completed: _______________________
Hours Expended: ________ Date Completed: ______
WBS Dictionary(PMBOK 3rd Edition, Page 117)
• Controls what work is done,
when, by whom, for how much.
• Created with team member’s
help
Creating a WBS(Post-It Note Process)
Task “A” Specs. & Req.
Start Date Stop Date
Est. HoursWho?
= Task Description
The WBS dictionary describes the detailed content of the WBS work packages.
Post-It Note Process: A Method For Bottoms Up Estimating
6.3.2 Estimate Activity ResourcesTools and Techniques
Page 91
Alternative Analysis
Brainstorming: a method of joint creative thinking that first records and
considers all possible options/solutions without judgment before proceeding to
critical evaluation of the project/product requirements.
Nominal Group Technique: enhances brainstorming with a voting process to
rank the best ideas for further brainstorming or prioritization.
Delphi Technique: questionnaires are sent to a group of experts who provide
answers and are kept anonymous. Responses are compiled, prioritized, and
sent back for another round of requirements gathering. A method for building
consensus.
Idea/Mind Mapping: a graphical method of consolidating brainstorm ideas to
show commonality and differences and to generate new ideas.
Affinity Diagram: gathering large numbers of ideas and sorting them into
groups for review and analysis – they help to identify patterns within data.
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
6.3.3 Estimate Activity ResourcesOutputs
Page 92
Activity Resource Requirements
The output of resource planning is a set of resource requirements. The resourcerequirements describe what types of resources are required and in whatquantities for each element of the WBS. The list of resource requirements will beused for staff acquisition and procurement planning. Develop Scheduledetermines when the resources are needed.
This is a hierarchical structure of identified resources, sorted by category andtype. When limited to people resources, it is sometimes referred to as a projectorganization chart.
Updates include activity list, activity attributes, and resource calendars
Resource Breakdown Structure
Project Documents Updates
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
6.5 Estimate Activity Durations
Planning: Time Management
Outputs
Activity duration estimatesProject documents updates
Tools & Techniques
Expert judgmentAnalogous estimatingParametric estimatingThree-point estimatingGroup decision-making
techniquesReserve analysis
Inputs
Schedule management planActivity listActivity attributesActivity resource requirementsResource calendarsProject scope statementRisk registerResource breakdown structureEnterprise environmental factorsOrganizational process assets
Page 93
PMBOK® Fifth Edition, Page 166
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
6.5 Estimate Activity Durations PMBOK® Fifth Edition, Page 166
Estimates may be obtained in the following ways:• Expert judgment• Analogous estimating• Parametric estimating• Three-point estimates• Group decision-making
A contingency reserve (or time reserve, or buffer) may be used to account for schedule uncertainty
Page 93
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
6.5 Estimate Activity Durations
Definition: Estimating the number of work periods needed to completeeach activity with estimated resources.
The team members should make the estimate.
Estimates: (1) amount of work to complete each activity, (2) number ofresources to be applied, and (3) number of work periods needed to finisheach activity.
Duration estimates are progressively elaborated.
Rolling Wave applies to duration estimating
Estimating duration includes elapsed time as well as work time.
Page 93
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
6.5.1 Estimate Activity Durations
Pages 94-96
Schedule management plan Activity list Activity attributes Activity resource requirements Resource calendars Project scope statement Risk register Resource breakdown structure Enterprise environmental factors Organizational process assets
Inputs
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
6.5.2 Estimate Activity Durations
Page 98
Tools and Techniques, Estimating Methods
Analogous Time Estimating (a form of expert judgment):Estimating the time to do tasks or to do a current project by extrapolating from actual cost of a previous project. Also called top-down time estimating. Inexpensive but may also be inaccurate.
Parametric Time Estimating:Using a statistical relationship to predict project times, e.g., activity multiplied by productivity rate predicts time standards, or number of drawings multiplied by labor hours per drawing calculates drawing duration.
Expert Judgment:By the project team, or other experts, e.g., rolling up the WBS time estimates to get a project total.
Task “A”
Start Date Stop Date
Est. HoursWho?
ExamTip
People doing the work create time & cost estimates
Reserve Analysis (Contingency):Project Teams can incorporate additional time into projects for schedule risk contingency or buffer. Qual. (%) or Quant. (Monte Carlo)
PMBOK® Fifth Edition, Page 169
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013Page 98
6.5.2 Estimate Activity Durations PMBOK® Fifth Edition, Page 170
Tools and Techniques, Analysis Methods
Critical Path Method (CPM)
• Uses a weighted average to estimate activity and project durations.• Provides variance estimates for duration dates.• Emphasis is on controlling schedule and leaving cost flexible• Used on ADM (AOA) diagrams, can have dummies.• Is used on PDM diagrams also, but they have no dummies
Three Point Estimates (PERT=Program Evaluation and Review Technique)
• One time estimate per task = “most likely” duration.• The emphasis is on controlling cost and leaving schedule flexible.• Used on ADM (AOA) diagrams, can have dummies.• Is used on PDM diagrams also, but they have no dummies
ExamTip
Pessimistic - Optimistic
6
Pessimistic + Optimistic + (4 x Most Likely)
6te =
Pessimistic - Optimistic
6
2Variance =
StandardDeviation =
Sometimes called Beta Distribution
Sometimes called Method of Moments
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013Page 99
6.5.2 Estimate Activity DurationsTools and Techniques, Duration Estimates
Quantitative EstimateIndication of Range
Indication of Confidence
19 1days with 68% confidence19 2 days with 95.5% confidence19 4 days with 99.7% confidence
o = most optimistic completion timep = most pessimistic completion timem = most likely completion time
te = o + 4m + p
6
(te) = p – o
6
te 1 <=> 68% probabilityte 2 <=> 95.5% probability
te 3 <=> 99.7% probability
16 17 18 19 20 21 22 23 2415
3-Point or PERT
Analysis
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Exercise
Calculate the following values using PERT…
A 14 27 47 28.166 5.5 30.25
B 41 60 89 61.666 8 64
C 39 44 48 43.833 1.5 2.25
D 29 37 42 36.5 2.166 4.693
Task Opt Likely Pess PERT Std. Dev Variance
Assuming that the tasks listed above make up the entire critical path for the project,how long will the project take? 170.2 days ± 10.1 days (add the variances and take square root)
Page 99
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
6.6 Develop Schedule
Planning: Time Management
Outputs
Schedule baselineProject scheduleSchedule dataProject calendarsProject management plan
updatesProject documents updates
Tools & Techniques
Schedule network analysisCritical path methodCritical chain methodResource optimization
techniquesModeling techniquesLeads and lagsSchedule compressionScheduling tool
Inputs
Schedule management planActivity listActivity attributesProject schedule network diagramsActivity resource requirementsResource calendarsActivity duration estimatesProject scope statementRisk registerProject staff assignmentsResource breakdown structureEnterprise environmental
factorsOrganizational process
assets
Page 101
PMBOK® Fifth Edition, Page 172
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
6.6 Develop Schedule
Develop Schedule is the process of analyzing activity sequences, durations, resource requirements and schedule constraints to create the project schedule
A technique to generate the project schedule employing
various analytical techniques such as critical path, critical chain, what-if
analysis and resource optimization
Schedule Network Analysis
A method used to estimate minimum duration and
flexibility in network paths. Calculates theoretical early
and late start and finish dates for all activities
without regard to resource limitations, using forward
and backward pass analysis
Critical Path Method
Allows the team to place buffers on any network
path to account for limited resources and duration
uncertainties. The resource-constrained critical path is the critical chain. A project buffer can be placed at the
end of the critical chain, and feeding buffers can be places on non-critical legs that feed into the critical
chain.
Critical Chain Method
Pages 103-105 & 110
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
6.6 Develop Schedule
Page 101
Determines planned start and finish calendar dates for project activities
Schedule development is iterative and continuously elaborated
Requires review of duration and resource estimates to create a schedule
Creates a baseline against which to track progress
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
6.6.2 Develop Schedule
Page 103
Tools and Techniques, Schedule Network Analysis
Critical Path Method (CPM)
• Uses a weighted average to estimate activity and project durations.• Provides variance estimates for duration dates.• Emphasis is on controlling schedule and leaving cost flexible
Three Point Estimates (PERT=Program Evaluation and Review Technique)
• One time estimate per task = “most likely” duration.• The emphasis is on controlling cost and leaving schedule flexible.
Pessimistic - Optimistic
6
Pessimistic + Optimistic + (4 x Most Likely)
6te =
Pessimistic - Optimistic
6
2Variance =
StandardDeviation =
Network analysis is a technique that generates the project schedule. It employsa schedule model and includes CPM, critical chain method, what-if analysis andresource optimization to calculate early and late start and finish dates.
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
6.6.2 Develop Schedule
Page 96
Tools and Techniques, Critical Path Method (CPM)
CPM calculates early and late start and finish dates for activities using forward andbackward pass analyses through the network paths. The early and late start andfinish dates may not be the same on different network paths since total float maybe positive, negative, or zero. Total float provides schedule flexibility.
Critical paths have either zero or negative total float. The definition of “CriticalPath” is the longest addition of activity durations on a path from start to finish. It isalso defined as the shortest period of time in which the project can be completed.
The definition of “Total Float” is the total amount of time a schedule activity can bedelayed from its early start date without delaying the project finish date. CPMcalculates total float by determining the difference between early finish and latefinish dates, or early and late start dates. Also known as slack, float, or projectfloat.
“Free Float” is the amount of time a schedule activity can be delayed withoutdelaying the early start date of its successor.
ExamTip
PMP® Prep: PMBOK® 5th - 2013
Slack Analysis
Page 103
If you have a network with parallel paths and one leg has slack, when you create the schedule, do you take the slack at the end of that leg or at the start?
12 days 16 days
9 days 13 days 6 daysSlack
12 days 16 days
9 days 13 days6 daysSlack
OR
When first laying out a schedule, put the slack at the end of the shorter leg. It helps with resource leveling and recovery if something happens to either of the two shorter legs during execution. Don’t schedule projects JIT.
JIT
PMP® Prep: PMBOK® 5th - 2013
Example of Critical Path Method
Start FinishA
1 5 5
1 0 5
B
6 5 10
11 5 15
C
6 10 15
6 0 15
D
16 15 30
16 0 30
Activity Name
Early Start
Early FinishDuration
Late Finish
Late Start
Total Float
Legend
Critical PathNon-Critical Path
©2013 PMI. A Guide to the Project Management Body of Knowledge (PMBOK® Guide), Fifth Edition
Path A, B, D = 25
Path A, C, D = 30
Page 105
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
• The critical path is the longest addition of durations over a network.
• It is the shortest period of time the project can be done.
• A project may have more than one critical path• The critical path may change as the project
progresses• Critical Path may be found using CPM, Three-
Point, or Monte Carlo analyses.
6.6.2 Develop ScheduleCritical Path Method
Definition
Brochures
Support
Margin
Stock
Profile
Training
Acceptance
Go/No Go Decision
Advertising
Training
DBT Stocking & Measuring Sys
Sales Aids & Brochure
Production
Go/No Go Launch
Program Launch
Sales
1 Week
1 Week
2 Weeks
2 Weeks
2 Weeks
4 Weeks
1 Week
0 Week
3 Weeks
4 Weeks
5 Weeks
7 Weeks
0 Week
1 Week
12 Weeks
Page 106
PMP® Prep: PMBOK® 5th - 2013
Calculate the Critical Path
number above the node is the earliest possible start datenumber below the node is the latest possible start datecritical path is where earliest start date = latest start date
1
2
4
3
6
5Activity D
Activity C
2 days
1 day
0
0
9
9
1 5
5
5
3 5
6
7
Page 106 PMP® Prep: PMBOK 4® - 2013
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Critical Path: Related terms
Early Start Date is the earliest date that uncompleted activities can be started given the network logic and any schedule constraints
Early Finish Date is the earliest date that uncompleted activities can be finished given the network logic and any schedule constraints
Late Start Date is the latest date that an activity can begin without compromising a specified milestone (generally the project finish date)
Late Finish Date is the latest date than an activity can finish without compromising a specified milestone (generally the project finish date)
Total Float is the amount of time an activity can be delayed from its scheduled start date without delaying the project finish date, or violating a schedule constraint. Also know as float, slack, or project float
Free Float is the amount of time an activity can be delayed without delaying the early start of any following activities
Slack Time or Total Float = Late Finish Date - Early Finish Date, or Late Start - Early Start
Page 107
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Calculating Critical Path and Float
Page 108
A
B
C
D
E
F
3
9
2
12
3
50 5
0 3
0 12
21 24
12 21
5 7
21 24
19 21
0 12
12 21
14 19
9 12
TF = 14FF = 0
TF = 14FF = 14
TF = 9FF = 2
TF = 0FF = 0
Critical Path (C-E-F) = 24Total Float in A-D-F = 14Total Float in B-E-F = 9
------ = Backward Pass
Free float: The difference between early start of predecessor and early start of successor, minus the estimated time of the predecessor
Free Float of A = 0 (5-0-5)Free Float of B = 2 (5-0-3)Free Float of D = 14 (21-5-2)
------ = Forward Pass
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Exercise
Work Package
Preceding Activity
Estimate inMonths
START 0
D START 4
A START 6
F D,A 7
E D 8
G F,E 5
B F 5
H G 7
C H 8
END C,B 0
START
D
A
E
F
G
B
H C
END
Answer: The critical path (project duration) is 33 months
(1) Draw the network diagram and find the critical path…
(2) Find the slack of task A-F-B path, and of the D-E-G-H-C path from the answer above.
Answer: A-F-B = 15 Months, D-E-G-H-C = 1 Month
Page 109
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Exercise: ADM
Page 109
2. If the duration of task F changes to 2 weeks, what is the effect on the project?3. What task(s) must be completed before task D begins?4. If the management tells you to complete the project two weeks early, what is the project float?
Does the critical path change?
Work Package(Nodes)
Estimate
In Weeks
A: (0 - 1) 3
9
C: (1 - 3) 3
(2 - 3) Dummy
E: (2 - 5) 2
D: (3 - 4) 2
F: (3 - 5) 1
G: (5 - 6) 4
H: (4 - 6) 2
B: (0 - 2)
The critical path is B, E, G. (Note that 0, 1, 2, 3, 4, 5, and 6 are nodes in the AOA or ADM Diagram). Critical Path = 15 Weeks.
0
1
2
3
5
4
6
B = 9
A = 3C = 3 D = 2
E = 2G = 4
F = 1
H = 2
Dummy
B-Dummy-F-G also becomes critical
Tasks A, B and C
Float is -2 weeks. No CP change unless Crashed or Fast Tracked
1. What tasks are on the critical path?
There may be 5-7 questions on network diagrams on the exam. Here is an example of a form of question that has a table of information and four questions that relate to it:
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Critical chain modifies the schedule to account for limited resources. Initiallythe critical path of a network is calculated using activity duration estimates.Then, resources are applied and the resulting schedule may be resourcelimited. The critical chain method adds duration buffers that are non-workactivities. The planned activities are then scheduled to their latest start andfinish dates. Instead of managing total float, critical chain focuses on managingthe buffer durations and the resources applied to the planned activities.
6.6.2 Develop ScheduleTools and Techniques, Critical Chain Method
Pages 110
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Example of Critical Chain Method
Start Finish
Legend Critical Chain LinkNon-Critical Link
Activity C
Activity A
Activity G
Activity B
Activity D
Feeding Buffer
Feeding Buffer
Activity E Activity FProject Buffer
Pages 110
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013Pages 111
6.6.2 Develop ScheduleTools and Techniques, Resource Optimization: Leveling and Smoothing
Month 1 Month 2 Month 3 Month 4
Product Manager
Resource plans are best when resource requirementsincrease and decrease without variations
0.5
1.0
1.5
The resource histogram is a time-phased display of the amount of project work assigned to each resource
• May be used at the individual or group level• May be used to detect over-allocation of resources• Avoid over-allocation, under-allocation, and peaks and valleys
(PMBOK Fourth Edition, Page 156)
Scheduling Tool
PMP® Prep: PMBOK® 5th - 2013Page 112
Critical Path: A-D-F and
B-E-F
4 Days Slack
A C
D
F
EB
Start Finish
2 2
4
2
3 3
2 3
1
1 1
2
Duration in Days
Work Force RequiredWork Force Available Each Day: 4 People
A
D
FC
B
E
2 2
1 1 1 1
2 23 3
1 1 1
1 1 1
1 2 3 4 5 6 7 8Days
Work Force 3 3 5 5 2 2 2 2
Network Analysis and Resource Leveling
PMP® Prep: PMBOK® 5th - 2013
A C
D
F
EB
Start Finish
2 2
4
2
3 3
2 3
1
1 1
2
A
B
E
2 2
D
F
1 1 1 1
2 2
C3 3
1 1 1
1 1 1
1 2 3 4 5 6 7 8 9 10Days
Work Force 3 3 4 4 2 2 1 1 2 2
2 Days Slack
Page 112
Network Analysis and Resource Leveling
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013Pages 113
6.6.2 Develop ScheduleTools and Techniques, “What if” Scenario Analysis
“What-If” analysis is the process of evaluating scenarios and their effect on schedule,i.e., “what if” a major component delivery is delayed? It assesses effect of adverseconditions on the project schedule and helps with response planning.
Simulations calculate multiple project durations with different activity assumptions.They use three-point estimates (PERT) to determine duration uncertainty. The mostcommon simulation uses Monte Carlo analysis. Possible activity durations are definedand used to calculate outcomes for the total project. Simulations are valuable foranalyzing the sensitivity of the project to changes and for addressing the impact ofuncertainty in the network logic, duration of activities, and availability of resources.
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Applying Leads and Lags
A lead allows acceleration of the successor activity (you
“lead in” to fast track a project).
A lag directs a delay in the successor activity (you “lag out” to
allow a waiting time).
ExamTip
Pages 114
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
If you can’t change the scope, there are two ways to meet schedule constraints:
CrashingA technique used to shorten the schedule duration for the least
incremental cost by adding resources.
Page 114
6.6.2 Develop ScheduleTools and Techniques, Schedule Compression
ExamTip
Fast TrackingA technique where activities or phases normally done in sequence
are done in parallel for at least a portion of their duration. Fast tracking may result in rework and increased risk.
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Exercise
Task Original Duration
in months
Crash Duration
in months
Time Savings
Original Cost in $
Crash Cost in $
Extra Cost in $
Extra Cost in $ per mth
Risk Impact
F 14 12 2 10,000 14,000 4,000 2,000 HIGH
A 9 7 2 17,000 27,000 10,000 5,000 LOW
H 3 2 1 25,000 26,000 1,000 1,000 LOW
G 7 6 1 14,000 16,000 2,000 2,000 HIGH
C 11 8 3 27,000 36,000 9,000 3,000 NONE
1. What option below would you select to save three months on the project assuming that the tasks listed below represent critical path?
There is no answer. The answer depends on whether cost or risk is most important.
2 Lets assume that time is of most importance followed by cost. Such questions are on the exam. What would be your answer?
The answer would be to select tasks F and H for an additional cost of $5,000.If risk is second to time in importance the answer would be to select task C foran additional cost of $9,000. The exam will probably not include risk columnbecause risk (nor quality) is not considered when most people crash or fast tracktheir projects. Without a risk column, simply pick the least cost alternative
Page 116
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
The Project Schedule may be presented in tabular form, however it’s moreoften presented graphically using milestone charts, bar charts or projectschedule network diagrams. The schedule baseline is a specific version of theproject schedule that is accepted and approved by the project team. It is acomponent of the project management plan
6.6.3 Develop ScheduleOutputs, Project Schedule
Page 117
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Example: Milestone Chart
Example: Bar Chart, Gantt Chart
6.6.3 Develop ScheduleOutputs, Project Schedule
Example Schedules
Page 117
ID Task Name
1 Mark Out Site
2 Dig Foundation A
3 Dig Foundation B
4 Concrete Foundation A
5 Concrete Foundation B
6 Com plete Base at A
7 Erect Plinth
8 Erect Tower A
9 Erect Tower B
10 Erect Span
F S S M T W T F S S M T W T F S S M T W T F S S M T W T F S S M T W T F S S M T W T
Nov 9, '97 Nov 16, '97 Nov 23, '97 Nov 30, '97 Dec 7, '97 Dec 14, '97 Dec 21, '97
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
The Project Schedule
• May be represented by a Gantt chart, an activity network diagram, or a milestone chart
• Indicates the planned start and finish dates for each WBS element
• May also indicate early start, late start, early finish, and late finish dates for each activity
Definition
Brochures
Support
Margin
Stock
Profi le
Training
Acceptance
Go/No Go
DecisionAdvertizing
Training
DBT Stocking &
Measuring Sys
Sales Aids &
Brochure
Production
Go/No Go
Launch
Program Launch
Sales
Name Duration
Definition1w
Feasibility30d
Brochures1w
Margin2w
Stock Profile4w
Support2w
Training2w
Acceptance1w
Go/No Go Decision 0d
Program Development35d
Sales Aids & Brochure3w
Advertising 4w
Training 5w
DBT Stock & Measure 7w
0d
Program Launch 1w
Sales 12w
Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7
Page 118
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Turn to page 387 in the workbook
There are 60 questions.
You have 72 minutes to complete
Answers are on page 404
Practice Test #1
Page 387
Hint: Use scratch paper for answers,so you can reuse the questions for practice
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
7.1 Plan Cost Management
Planning: Cost Management
Outputs
Cost management plan
Tools & Techniques
Expert judgmentAnalytical techniquesMeetings
Inputs
Project management planProject charterEnterprise environmental factorsOrganizational process assets
Page 119
PMBOK® Fifth Edition, Page 195
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Plan Cost Management
Plan Cost Management is the process that establishes policies, procedures, documentation for planning, expending, and controlling project costs. This is a component of the project management plan.
Inputs
• Project Management Plan Information to develop the Cost Management Plan:
• Scope baseline
• Schedule baseline
• Other information
• Project Charter (Provides a summary budget)
• EEF and OPA
Page 120
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Plan Cost ManagementTools and Techniques
• Expert Judgment
• Analytical Techniques (Choosing options to fund the project: self-funding, equity funding, or debt funding. Ways to finance resources: make, buy, rent, or lease. Policies may influence: ROI, payback period, internal rate of return, discounted cash flow, and net present value.)
• Meetings
Page 120
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Plan Cost ManagementOutputs
• Cost Management Plan units of measure,
level of precision,
level of accuracy (e.g., ±10%),
organizational procedures (the WBS is a framework for cost estimating),
control threshold (% deviation from the baseline plan),
rules of performance measurement (EVM),
reporting formats (format and frequency of cost reports),
process descriptions,
strategic funding, exchange rate fluctuations, and cost recording.
Page 121
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
7.2 Estimate Costs
Planning: Cost Management
Outputs
Activity cost estimatesBasis of estimatesProject documents updates
Tools & Techniques
Expert judgmentAnalogous estimatingParametric estimatingBottom-up estimatesThree-point estimatesReserve analysisCost of qualityProject management
softwareVendor bid analysisGroup decision-
making techniques
Inputs
Cost management planHuman resource mgt. planScope baselineProject scheduleRisk registerEnterprise environmental factorsOrganizational process assets
Page 122
PMBOK® Fifth Edition, Page 200
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
7.2 Estimate Costs
Estimate Costs is the process of developing an approximation of the monetary resources needed to complete project activities.
Usually they are expressed in monetary terms, although other units of measure such as person hours or staff days are often used.
Costs include the resources to be charged to the project which includes labor, but may also include also materials, equipment and facility fees and services.
Both direct and indirect costs should be considered.
Page 123
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
7.2 Estimate Costs PMBOK® Fifth Edition, Page 201
Page 124
Cost estimates are progressively elaborated during the course of theproject as additional detail becomes available. Accuracy increasesthrough the project life cycle.
For example, a project in the Initiation phase could have a roughorder of magnitude (ROM) estimate in the range of -25% to +75%.Later in the project as more detail is known, estimates could narrowto -5% to +10%.
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
7.2.2 Estimate CostsInputs
Pages 123-125
• Cost Management Plan (how project costs will be managed and controlled)
• Human Resource Management Plan(project staffing plan, personnel rates, rewards/recognition)
• Scope baseline(Scope statement, WBS, and WBS dictionary)
• Project Schedule (type and quantity of resources and time required to complete the work)
• Risk Register(negative risks cause near-term costs to increase and project schedules may be delayed)
• EEF and OPA
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
7.2.2 Estimate CostsInputs
Page 123
• Should be determined per unit of use (e.g., hours, meters, kilos)• Salaries should be known at the individual or group rate• Components of labor rates may include:
– base rate– tax burden if applicable (as a percentage of base rate)– benefit burden if applicable (fixed or percentage of base rate)– allocation for overhead (percentage of burdened rate)
Charge Rate = [(Base Rate) * (Burden)] * Overhead
i.e., Charge Rate = [($30/hr) * (1.3)] * 1.8 = $70/hr.
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Expert Judgment: consult with experts and obtain historical information.
Analogous Estimating: top-down estimating - a similar project is the basis of estimates for the current one. It is most reliable when previous projects are similar.
Parametric Estimating: uses a statistical link between historical data and the current project which is then used for calculation (e.g., cost per square foot).
Reserve Analysis: a contingency reserve may be used to account for cost uncertainty
Cost of Quality (COQ): determining costs incurred to assure quality
Project Management Software: simplifies cost estimating. Rapid alternatives evaluation
Vendor Bid Analysis: bids from suppliers help analyze what a project should cost
7.2.2 Estimate CostsTools and Techniques
Pages 126-129
Bottom-Up Estimating: the smaller the activity, the more accurate is the cost estimate.
Three-Point Estimates (PERT): a weighted average, more accuracy. Ce =o + 4m + p
6
Group Decision-Making Techniques: Delphi or nominal group techniques improve cost accuracy and the team commitment to cost estimates
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
7.2.2 Estimate CostsTools and Techniques
ExamTip
People doing the work create time & cost estimates
Analogous Cost Estimating (a form of expert judgment):Estimating cost of a current project by extrapolation from actual cost ofa previous project. Also called top-down estimating. Inexpensive butmay also be inaccurate.
Parametric Cost Estimating:The quantities for specific work multiplied by the resource rate can estimate cost (number of drawings times cost per drawing, cost per line of code, cost per square foot for types of construction).
Bottom-Up Estimating:Rolling up the WBS estimates to get a project total.
Task “A”
Start Date Stop Date
Est. HoursWho?
Page 128
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
7.2.2 Estimate CostsTools and Techniques
Page 128
Quantitative EstimateIndication of Range
Indication of Confidence
60 5days with 68% confidence60 10 days with 95.5% confidence60 20 days with 99.7% confidence
o = most optimistic cost estimatep = most pessimistic cost estimatem = most likely cost estimate
Ce =o + 4m + p
6
(Ce) = p – o
6
Ce 1 <=> 68% probabilityCe 2 <=> 95.5% probability
Ce 3 <=> 99.7% probability
45 50 55 60 65 70 75 80 8540
3-Point Analysis or
PERT
Hours
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
AACE International Cost Classification Recommended Practices
Class Name End Usage Level of Project AccuracyDefinition Range
5 Rough Order of Magnitude Concept Screening 0 to 2% L: -20 to -50%
(ROM) H: +30 to +100%
4 Concept Study or Feasibility 1 to 15% L: -15 to -30%
H: +20 to +50%
3 Budget/Authorization Budget Authorization 10 to 40% L: -10 to -20%
or Control H: +10 to +30%
2 Definitive/Control Control or Bid/Tender 30 to 70% L: -5 to +15%
H: +5 to +20%
1 Detail/Bid/Tender Check Estimate or 50 to 100% L: -3 to -10%
Bid/Tender H: +3 to +15%
PMI, PMBOK®
Order of Magnitude Estimates: -25% to +75%(Usually made during Initiation Phase)
Budget Estimate: -10% to +25%(Usually made during the Planning Phase)
Definitive Estimate: -5% to +10%(Roll up of WBS? Rule of 80 hours or two weeks?)
7.2.3 Estimate CostsOutputs, Accuracy of Estimates
ExamTip
These come up often on the exam, but are easy
to answer once you memorize the numbers.
Page 130
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
7.3 Determine Budget
Planning: Cost Management
Outputs
Cost baselineProject funding requirementsProject documents updates
Tools & Techniques
Cost aggregationReserve analysisExpert judgmentHistorical relationshipsFunding limit reconciliation
Inputs
Cost management planScope baselineActivity cost estimatesBasis of estimatesProject scheduleResource calendarsRisk registerAgreementsOrganizational process assets
Page 131
PMBOK® Fifth Edition, Page 208
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
7.3.1 Determine Budget
Determine Budget is the process of aggregating estimated costs of individual activities or work packages to establish an authorized cost baseline.
The cost baseline is the time-phased project budget, but excludes management reserves.
Inputs
Cost Management Plan Scope Baseline Activity Cost Estimates Basis of Estimates Project Schedule Resource Calendars Risk Register Agreements Organizational Process Assets
Pages 131-132
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
7.3.2 Determine Budget
Pages 133-134
Tools and Techniques
Cost Aggregation: work package costs at the bottom of the WBS are summed (aggregated) to the next level, then costs at this level are summed to higher levels, etc. This is called “rolling costs up the WBS” to develop an overall cost budget.
Reserve Analysis: establishes both contingency reserves (unplanned changes due to
identified risks, “known unknowns”), and management reserves (unplanned changes to
project scope and cost, “unknown unknowns”). Reserves are NOT part of cost baseline, and not part of earned value calculations, but are included in the budget.
Expert Judgment: budgeting information from prior, similar projects.
Funding Limit Reconciliation: funding limits may be set by the customer to which spending must be reconciled. This might cause rescheduling and reallocation of resources to regulate cash flow.
Historical Relationships: parametric analysis from historical sources can predict total costs. Math models are used.
ExamTip
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Time
Cost Cost Baseline
Cumulative Planned Value (PV)
Monthly Planned Value (PV)
Spending Plans and Cash Flow
Plans are special types of Cost
Baselines
Cost Baseline: a time-phased budget (either by period or cumulative over the life of the project) used to measure, monitor and control project costs.
BAC
7.3.3 Determine BudgetOutputs, Cost Baseline, or Performance Measurement Baseline (PMB)
Page 134
ExamTip
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Project Budget Components
Cost Baseline
Project Budget
ControlAccounts
Contingency Reserve
Management Reserve
Work Package Cost Estimates
Activity Contingency Reserve
Activity Cost Estimates
Total Amount
Project Budget Component
©2013 PMI. A Guide to the Project Management Body of Knowledge (PMBOK® Guide), Fifth Edition
Page 135
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
7.3.3 Determine BudgetOutputs: Funding Requirements and Management Reserve
Page 136
Time
Cost
Cost Baseline
Cumulative Planned Value (PV)
Cash Flow
Funding
} Management Reserve
Project Budget
BAC
Expenditures
ExamTip
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
A Review
Plan Scope Management Collect Requirements Define Scope Create WBS Plan Schedule Management Define Activities Sequence Activities Estimate Activity Resources Estimate Activity Durations Develop Schedule Plan Cost Management Estimate Costs
Determine Budget Plan Quality Management Plan Human Resource Management Plan Communications Management Plan Risk Management Identify Risks Perform Qualitative Risk Analysis Perform Quantitative Risk Analysis Plan Risk Response Plan Procurement Management Plan Stakeholder Management
Think of the PM plan as a bucket into which all the other plans “drip” until it is full.
Pages 45 & 49
The Project Management Plan
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Make a list of items that go into a Project Plan in the spaces provided below :
Exercise
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Make a list of items that go into a Project Plan in the spaces provided below :
Exercise
Project Management Plan
Collect requirements
Define Scope
Create WBS
Plan Schedule Management
Define Activities
Sequence Activities
Est. Activity Resources
Est. Activity Durations
Develop Schedule
Plan Cost Management
Estimate Costs
Determine Budget
Plan Quality
Develop HR Plan
Plan Communications
Plan Risk Management
Identify Risks
Perform Qual. Risk Analysis
Perform Quant. Risk Analysis
Plan Risk Responses
Plan Scope Management
Plan Procurement
Plan Stakeholder Mgt.
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Chapter 8: Project Quality ManagementPMBOK Fifth Edition, Page 227
Knowledge Area
Quality is the degree to which a set of inherent characteristics fulfill requirements
Page 139
Quality management processes include:
8.1 Plan Quality Management: The process of identifying quality requirements/standards for the project and its deliverables, and documenting how the project will demonstrate compliance.
8.2 Perform Quality Assurance: The process of auditing the quality requirements, and results from quality control measurements, to ensure that appropriate quality standards and operational definitions are used.
8.3 Control Quality: The process of monitoring and recording results from executing quality activities to assess performance and recommend changes.
Quality management here is compatible with ISO (International Organization for Standardization) as well as Shewhart, Deming, Juran, Crosby, FMEA (Failure Modes and Effects Analysis), Customer Satisfaction, The Voice of the Customer, Prevention over Inspection, COQ (Cost of Quality), and Continuous Improvement (Total Quality Management, Six-Sigma, maturity models), and Management Responsibility.
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Chapter 8: Project Quality Management
Quality: The degree to which a set of inherent characteristics fulfill requirements.
Grade: Products that perform the same function but have different technical characteristics.
A product may be high quality (no obvious defects) but low grade (limited number of features)
Quality vs. Grade
Page 139
ExamTip
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Chapter 8: Project Quality Management
Precision vs. Accuracy
Page 140
ExamTip
Precision = Consistency.
Accuracy = Correctness.
Precision: repeated measurements have little scatter.
Accuracy: measured value is close to the true value.
Precision
Accuracy
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Note to Test Takers
Quality is one of the most heavily tested areas on the examination.
Study it completely during your preparations to take the test!
Page 141
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8.1 Plan Quality Management
Planning: Project Quality Management
Outputs
Quality management planProcess improvement planQuality metricsQuality checklistsProject documents updates
Tools & Techniques
Cost-benefit analysisCost of quality (COQ)Seven basic quality toolsBenchmarkingDesign of experimentsStatistical samplingAdditional quality planning
toolsMeetings
Inputs
Project management planStakeholder registerRisk registerRequirements documentationEnterprise environmental factorsOrganizational process assets
Page 142
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8.1 Plan Quality Management PMBOK® Fifth Edition, Page 231
Plan Quality is the process of identifying quality requirements and/or standards for the project and its deliverables, and documenting how the project will demonstrate compliance.
The Quality Management Plan, which is an output of this process, describes how the project management team will implement the quality policy and meet the quality requirements.
Quality is planned, designed, and built into the project. It is not inspected in.
Page 142
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8.1.1 Plan Quality Management
Pages 142 & 143
Inputs
• Project Management Plan, which includes:
Scope Baseline (Scope statement, WBS, and WBS dictionary),
Schedule & Cost Baselines, etc.
• Stakeholder Register
• Risk Register
• Requirements Documentation(stakeholder quality requirements)
• EEF and OPA
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
8.1.2 Plan Quality ManagementTools and Techniques
Cost-Benefit Analysis: compares COQ with expected benefits.
Cost of Quality (COQ): investment in preventing non-conformance to requirements.
Seven Basic Quality Tools: (1) cause and effect diagrams, (2) flowcharts, (3) checksheets, (4) Pareto diagrams, (5)histograms, (6) control charts, (7) scatter diagrams.
Statistical Sampling: inspecting part of a batch to qualify the whole population.
Additional Quality Planning Tools: brainstorming, force field analysis, nominal group technique, quality management and control tools.
Meetings
Benchmarking: comparing to similar projects to identify best practices.
Design of Experiments: statistical: what factors influence project variables?
Pages 144 - 151
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8.1.2 Plan Quality
Page 143
Tools and Techniques: Quality Definitions
Conformance to Requirements, Specifications and Fitness For Use:
• This one phrase will help you to answer about 4 questions on the exam.Memorize it!
• The PM should perform careful “needs” analysis of the stakeholders which become foundations of the Scope
Gold Plating:
• PMI® does not support giving the customer “extras”.
• Gold Plating adds no value to the project.
• Exam questions have the team member’s coming to the PM with impressions of what the customer would like.
Prevention over Inspection
Note: There may be 15 or more questions relating to definitions and control charts
ExamTip
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
8.1.2 Plan Quality
Page 145
Tools and Techniques: Cost of Quality (COQ)
Cost of Conformance Cost of Nonconformance
Prevention Costs(Build a quality product)
• Training
• Documentation processes
• Equipment
• Time to do it right
Appraisal Costs(Assess the quality)
• Testing
• Destructive testing loss
• Inspections
Internal Failure Costs(Failures found by project team)
• Rework
• Scrap
External Failure Costs(Failures found by the customer)
• Liabilities
• Warranty work
• Lost business
Money spent to avoid failures
Money spent because of failures
ExamTip
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8.1.2 Plan Quality Management
Page 145-146
Tools and Techniques: Flowcharting
Cause & Effect, Ishikawa or Fishbone Diagrams
EFFECTCAUSES
People
Lack of Training
MethodsMaterial
Transport IT System Procedure
Process Flowchart
Design Review
Revise
OK?Yes
Proceed
No
Not Following Procedures
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
8.1.2 Plan Quality ManagementTools and Techniques: Flowcharting, SIPOC Model
Suppliers Inputs Process Outputs Customers____________ ____________ ____________ ____________ ________________________ ____________ ____________ ____________ ________________________ ____________ ____________ ____________ ____________
Supplier Process Customer
Input Output
Requirements and Feedback Loop
Requirements and Feedback Loop
Requirements List Measurements List Requirements List Measurements List
____________ _____________ _____________ _________________________ _____________ _____________ _________________________ _____________ _____________ _____________
©2013 PMI. A Guide to the Project Management Body of Knowledge (PMBOK® Guide), Fifth Edition
Page 145-146
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8.1.2 Plan Quality Management
Page 147
Tools and Techniques: Pareto Diagrams and Design of Experiments
source
% c
on
trib
uti
on
(o
r fr
equ
en
cy o
f o
ccu
rren
ce)
Pareto’s Law:
80/20 Rule
80%?
Design of Experiments:
Which factors may influence specific variables?
“What If” Analysis
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
A histogram shows central tendency, dispersion, and shape of a statistical distribution.
0.5
1.0
1.5
8.1.2 Plan Quality ManagementTools and Techniques: Histograms
Page 147
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8.1.2 Plan Quality Management
Page 148
Tools and Techniques: Control Charts
A chart of process performance over time used todetermine if the process is in control or out of control
in control normal distribution of outcomes due to common causes of variation
inherent in the process
out of control rule of seven, trends, and cycles due to special causes of variation
external to the process
±1
6
8%
±2
9
5.5
%
±3
9
9.7
%...
...
.....
..................
UCL
LCL
......
Mean
.Normal
Distribution Curve
Expected Variation
Out of Control(Assignable Cause)
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8.1.2 Plan Quality Management
Page 149
Tools and Techniques: Control Chart
Plan or Mean
UCL
LCL
Lower Spec. Limit
Upper Spec. Limit
Actual
Hours recorded for this project started on plan, but if the trend continues, hours spent will drift out of control.
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
8.1.2 Plan Quality ManagementTools and Techniques: Scatter Diagram
Page 149
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0 5 10 15 20 250
2
4
6
-2
-4
-6
Total Travel Days in the Month
Sub
mis
sio
n D
ays,
Ear
ly (
-), L
ate
(+)
o o o
o
o
o
o
o
o
o
o
o
o oo
o o
o
oo o o
Timecard Submission vs. Travel Days
8.1.2 Plan Quality ManagementTools and Techniques: Scatter Diagram
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013PMBOK® Fifth Edition, Page 239
©2013 PMI. A Guide to the Project Management Body of Knowledge (PMBOK® Guide), Fifth Edition
8.1.2 Plan Quality ManagementTools and Techniques: Seven Basic Quality Tools
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8.1.2 Plan Quality Management
Page 150-151
Tools and Techniques: Statistical Sampling
…a technique for accepting or rejecting a larger population by choosing a part of the population for inspection ...
• Statistical sampling can reduce the cost of QC on a project.
• The validity of statistical sampling depends on anappropriate choice of sample items and sample size.
• Sample size increases exponentially as the level of desired certaintyincreases and the acceptable level of error decreases.
• Sampling strategies include single samples from a lot, multiple smallsamples from a lot, and double sampling methods where the size of thesecond sample depends on the results of the first sample.
• All sampling strategies involve some risk of producer error (type I error)where acceptable lots are rejected based on a non-representative sampleor consumer error (type II error) where unacceptable lots are acceptedbased on a non-representative sample.
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
8.1.2 Plan Quality Management
Page 151
Tools and Techniques: Additional Quality Planning Tools, Affinity Diagram
These include brainstorming, affinity diagrams, force field analysis, nominal group techniques, matrix diagrams, flowcharts, and prioritization matrices.
Affinity Diagrams are useful for gathering large amounts of data (opinions, ideas etc.) and for organizing them intogroupings based on their relationship. An Affinity Diagram can help to identify patterns within data providingrecourse for further investigation or action.
Force Field Analysis looks at all the forces for and against a decision. In effect, it is a specialized method ofweighing pros and cons. You can plan to strengthen the forces supporting a decision, and reduce the impact ofopposition to it.
A nominal group technique is a structured process which identifies and ranks the major problems or issues thatneed addressing.
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8.1.2 Plan Quality
Page 151
Tools and Techniques: Additional Quality Planning Tools, Group Creativity
Brainstorming: a method of joint creative thinking that first records andconsiders all possible options/solutions without judgment beforeproceeding to critical evaluation of the project/product requirements.
Nominal Group Technique: enhances brainstorming with a voting processto rank the best ideas for further brainstorming or prioritization.
Delphi Technique: questionnaires are sent to a group of experts whoprovide answers and are kept anonymous. Responses are compiled,prioritized, and sent back for another round of requirements gathering. Amethod for building consensus.
Idea/Mind Mapping: a graphical method of consolidating brainstorm ideasto show commonality and differences and to generate new ideas.
Affinity Diagram: gathering large numbers of ideas and sorting them intogroups for review and analysis – they help to identify patterns within data.
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
8.1.3 Plan Quality Management
Pages 152 & 153
Outputs
• Quality Management Plan
• Process Improvement Plan (process boundaries, configuration, metrics, and targets for improved performance)
• Quality Metrics
• Quality Checklists
• Project Documents Updates (stakeholder register, responsibility assignment matrix, WBS, WBS dictionary, etc.)
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
8.1.3 Plan Quality Management
Pages 155
Outputs: Update Responsibility Assignment Matrix (RACI Chart)
R = Responsible
A = Accountable
C = Consulted
I = Informed
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Chapter 9: Plan Human Resource ManagementPMBOK Fifth Edition, Page 255
Human resource management includes the processes that organize, manage, and lead the project team
The project management team (core, executive, or leadership team) is a subset of the project team
and is responsible for leadership activities.
ExamTip
Page 155
Knowledge AreaProject Human Resource Management processes include:
9.1 Plan Human Resource Management: The process of identifying and documenting project roles., responsibilities required skills, reporting relationships, and creating a staffing management plan.
9.2 Acquire Project Team: confirming HR availability and obtaining the team to complete project activities.
9.3 Develop Project Team: improving competencies, team members interaction, and team environment to enhance performance.
9.4 Manage Project Team: tracking team member performance, providing feedback, resolving issues, and managing change to enhance project performance.
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9.1 Plan Human Resource Management
Planning: Human Resource Management
Outputs
Human resource management plan
Tools & Techniques
Organization charts and position descriptions
NetworkingOrganizational theoryExpert judgmentMeetings
Inputs
Project management planActivity resource requirementsEnterprise environmental factorsOrganizational process assets
Page 156
PMBOK Fifth Edition, Page 258
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9.1 Plan Human Resource Management PMBOK® Fifth Edition, Page 258
Plan Human Resource Management is the process of identifying and documenting project roles, responsibilities, required skills and reporting relationships and creating a staffing management plan
Page 156
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9.1.2 Plan Human Resource Management
Pages 158-159
Tools and Techniques: Organization Charts and Position Descriptions
Hierarchical Chart
Project Organization Chart. shows project team members related to their work on the project. Simply substitute the name of the team member into the box of the WBS
Banking Protocols
Customer Services(TM #1)
Information Tech. and IS
(TM #2)
Operations(TM #3)
Regulatory(TM #4)
System Design(TM #22)
System Development
(TM #23)
Legal(TM #41)
Filing & Documentation
(TM #42)
Accounting Relations(TM #61)
Global Trans. Services(TM #51)
Cash Management
(TM #52)
Audit & Inspection(TM #53)
System Analysis(TM #21)
Product Planning(TM #11)
Treasury(TM #5)
Project Management
(PM)
Training(TM #31)
Sales(TM #12)
Integration Protocols(TM #32)
Strategic Planning(TM #62)
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
9.1.2 Plan Human Resource Management
Pages 158-159
Tools and Techniques: Organization Charts and Position Descriptions
Resource Breakdown Structure and Organizational Breakdown Structure
Resource Breakdown Structure breaks down projects by type of resource. It can help track project costs and can contain categories other than human resources.
Organizational Breakdown Structure (OBS) is a depiction of the project organization arranged to relate work packages to functional departments.
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9.1.2 Plan Human Resource Management
Page 159
Tools and Techniques: Organization Charts and Position Descriptions
Organizational Breakdown Structure
Project
Design Production
Comp. #2Comp. #1Comp. #2Comp. #1
Com
pan
y
Engin
eeri
ng
Man
ufa
cturi
ng
Ass
emb
lyP
arts
Ele
ctri
cal
Mec
han
ical
Cost
Account
Cost
Account
Cost
Account
Cost
Account
Cost
Account
Cost
Account
Cost
Account
Cost
Account
Cost Accounts provide a way to control how functional organizations to charge to projects.
WBS Codes show functional managers exactly what their people are doing on the project.
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9.1.2 Plan Human Resource Management
Page 160
Tools and Techniques: Organization Charts and Position Descriptions
Matrix Charts
PMI® advocates that all roles and responsibilities on a project be
clearly assigned and be linked to scope and to the WBS.
• Often used for decision responsibilities or to resolve conflict.
• Multiple RAMs at different levels of the project, also called LRCs.
• Other responsibility charts: Resource Histogram, Resource Gantt
Chart - know these.
Responsibility Assignment Matrix (RAM)
RAM (n.) a structure that relates the OBS to the WBS to ensure that
the scope of work components are assigned to a responsible person.
Design Lead Support Advise Advise Advise
Prototype Support Lead Advise Advise Advise
Scale Up Advise Advise Lead Support Support
Production Advise Advise Advise Lead Support
Assembly Advise Advise Advise Support Lead
Dav
e
Mar
y
Gav
in
Bo
b
Tom
R = Responsible
A = Accountable
C = Consulted
I = Informed
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9.1.2 Plan Human Resource Management
Page 161
Tools and Techniques: Organization Charts and Position Descriptions
Text-Oriented Forms
Position Descriptionsshow team member responsibilities, authority, competencies, and qualifications outlined in a text document. These can be used for Performance Evaluations
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
9.1.3 Plan Human Resource Management
Pages 162-163
Outputs
Human Resource Management Plan roles and responsibilities, project organization charts, staffing management plan:
Staff Acquisition
Resource Calendars
Staff Release Plan
Training Needs
Recognition and Rewards
Compliance
Safety.
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9.1.2 Develop Human Resource Plan
Page 163
Outputs: Resource Calendars, PMBOK Fifth Edition, Page 265
Resource Histogram is a time-phased display of
the amount of project work assigned to each resource
• May be used at the individual or group level• May be used to detect over-allocation of resources
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Chapter 10: Project Communications ManagementPMBOK Fifth Edition, Page 287
Knowledge Area
Project Communications Management includes the processes required to ensure timely and appropriate generation, collection,
distribution, storage, retrieval, and disposition of project information.
Page 164
Project Communications Management processes include:
10.1 Plan Communication Management: the process of developing an appropriate approach and plan for project communications based on stakeholder’s information needs and requirements,
10.2 Manage Communications: the process of creating, collecting, distributing, storing, retrieving, and disposition of project information.
10.3 Control Communications - the process of monitoring and controlling communications throughout the entire project life cycle to ensure information needs of stakeholders are met.
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10.2 Plan Communications Management
Planning: Project Communications Management
Outputs
Communications management plan
Project documents updates
Tools & Techniques
Communication requirements analysis
Communication technologyCommunication modelsCommunication methodsMeetings
Inputs
Project management planStakeholder registerEnterprise environmental factorsOrganizational process assets
Page 165
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10.2 Plan Communications Management PMBOK® Fifth Edition, Page 289
Communications Management is so important that it is sometimes included
as a major WBS element
Page 165
Study Concept Prototype Qualification
Typical
Project
Pilot Production Project Management &
Communications Plan
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10.2.2 Plan Communications Management Tools and Techniques
Communications Requirements Analysis
Communication Technology
Pages 166-167
Consider the following information as you plan your project communications:
• the project organization and stakeholder responsibility relationships• the functional departments involved in the project• the logistics: persons involved with the project and their locations• external information needs: communicating with external
stakeholders and the media
Communications planning will be both enhanced and constrained by the available communications technology.
• urgency of need for the information• availability, ease of use, and cost of the technology• experience and expertise of the project staff and other stakeholders• life of the available technology relative to the length of the project• project environment. Does the team meet face-to-face or in a virtual
environment• Sensitivity and confidentiality of the information.
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10.2 Plan Communications Management
Plan Communications is the process of determining the project stakeholder information needs and defining a communication approach
N(N – 1)
2
Channels =
The formula:
Reveals the number of possible channels of communication in a group, where N is the number of people in the group
Tools and Techniques
Page 166-167
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10.2.2 Plan Communications Management
If a project team of 5 people adds one more person to the team, how many more
channels of Communication are there?
Try it ….
Tools and Techniques
5 more
Page 167
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10.2.2 Plan Communications Management Tools and Techniques: Communication Models
Page 168
Articulating
Hearing
Listening
Transmitting
Thinking
Sending
Receiving
Feedback !!
The basic model of communication is the send-receive model which includes:• Encoding (translating ideas to language), • Transmit Message (transmitting),• Medium (methods used to transmit)• Noise (disruptions), and • Decoding (translate for receiver)• Acknowledge (receipt of message)• Feedback (back to sender).
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10.2.3 Plan Communications Management Outputs: Communications Management Plan
Page 169
The Communications Management Plan usually provides:
• Stakeholder communication requirements• Information to be distributed• Reason for the distribution• Time frame and frequency• Communication responsibilities
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
10.2.3 Plan CommunicationsOutputs: Communications Management Plan
Page 170
documents a communication strategy for the project and describes:
Stakeholder communication requirements
Which information flows from whom, when, via which media, and in what format.
Schedule and frequency for information collection and distribution.
Methods to convey information (memos, e-mail, press releases, etc.)
Resources for communication activities, including time and budget
Problem escalation procedure
Method for updating the communication plan
Flow charts of information flow
List of reports and meetings planned (schedule and attendees)
Communications constraints
“Communications infrastructure” for the project (who may talk to whom)
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Chapter 11: Project Risk ManagementPMBOK Fifth Edition, Page 309
Knowledge Area
Project risk management includes the processes of conducting risk planning, identification, analysis, response
planning, and monitoring and control on a project.
Page 171
Project Risk Management processes include:
11.1 Plan Risk Management: deciding how to approach, plan and execute risk management,
11.2 Identify Risks: which risks might affect the project and documenting their characteristics,
11.3 Perform Qualitative Risk Analysis: probability of occurrence and severity of impact,
11.4 Perform Quantitative Risk Analysis: numerically analyzing the effect of risks on objectives,
11.5 Plan Risk Responses: developing options to enhance opportunities and reduce threats.
11.6 Control Risks: implementing risk response plans, tracking risks, monitoring residual risks, ID new risks, and evaluating effectiveness throughout the project life cycle.
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Chapter 11: Project Risk Management
Page 171
• Project risk includes both threats to the project’s objectives (negative outcomes) and opportunities to improve on those objectives (positive outcomes) - PMBOK® Fifth Edition, page 310.
• Uncertainty: An uncommon state of nature, characterized by absence of information related to a desired outcome.
• Risk Management: The process of identifying, analyzing and responding to risk - maximizing positive events and minimizing consequences of negative events.
• Risk arises throughout a project and must be identified and evaluated on a regular basis over the life cycle of the project.
• Inputs to risk management process : All other planning processes, including Create WBS and
ExamTip
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11.1 Plan Risk Management
Planning: Project Risk Management
Outputs
Risk management plan
Tools & Techniques
Analytical techniquesExpert judgmentMeetings
Inputs
Project management planProject charterStakeholder registerEnterprise environmental factorsOrganizational process assets
Page 173
PMBOK® Fifth Edition, Page 313
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
11.1 Plan Risk Management
Plan Risk Management is the process of defining how to conductrisk management activities for a project.Risk planning should be commensurate with both the risks and theimportance of the project to the organization
Page 173
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11.1.1 Plan Risk ManagementInputs
11.1.2 Tools and Techniques: Analytical Techniques, Expert Judgment, and Meetings
Pages 174-175
• Project Management Planprovides current state of risk-affected areas including scope, schedule, and cost
• Project Charter high-level requirements
• Stakeholder Register
• EEF and OPA
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
11.1.3 Plan Risk ManagementOutputs
Risk Management Plan, includes:
• Methodology: Approaches, tools and data sources.
• Roles and Responsibilities: Team member ownership for risk activities.
• Budgeting: Funds needed for contingency reserves and management reserves.
• Timing: When processes will be done, reserves applied, and how risk appears in schedule.
• Categories: Risk groupings. The RBS looks at sources of risk, IDs and categorizes them.
• Thresholds: What is the trigger? Stakeholders have different thresholds of risk tolerance, define them, and the must be agreed by all.
• Define P/I Levels: Qualitative (low to high) or probabilities.
• Risk Matrix: Likelihood-Severity, or Probability-Impact.
• Stakeholder Risk Tolerances: Progressively elaborated.
• Reporting Formats and Tracking: Document risk, auditing, defines content of risk register.
Page 176
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11.2 Identify Risks
Planning: Project Risk Management
Outputs
Risk register
Tools & Techniques
Documentation reviewsInformation gathering
techniquesChecklist analysisAssumptions analysisDiagramming techniquesSWOT analysisExpert judgment
Inputs
Risk management planCost management planSchedule management planQuality management planHuman resource mgt. planScope baselineActivity cost estimatesActivity duration estimatesStakeholder registerProject documentsProcurement docs.EEFOPA
Page 177
PMBOK® Fifth Edition, Page 319
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
11.2 Identify Risks
Identify Risks is the process of determining which risks may affect the project and documenting their characteristics .
All project personnel should be encouraged to identify potential risks
Page 177
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11.2.1 Identify Risks
Pages 178
Inputs
• Risk Management Planprovides risk responsibilities, risk breakdown structure
• Cost, Schedule, Quality, and HR Management Plans
• Scope Baseline (scope statement, WBS, WBS dictionary)
• Activity Cost and Duration Estimates
• Stakeholder Register
• Project Documents (Charter, schedule, network, issue log)
• Procurement Documents
• EEF and OPA
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11.2.2 Identify Risks
Page 179
Tools and Techniques: Information Gathering Techniques
Brainstorming: a method of joint creative thinking that first records and considers all possible options/solutions without judgment before proceeding to critical evaluation of the project/product requirements.
Delphi Technique: questionnaires are sent to a group of experts who provide answers and are kept anonymous. Responses are compiled, prioritized, and sent back for another round of requirements gathering. A method for building consensus.
Interviewing: experienced stakeholders and SME can identify risks
Root Cause Analysis: Cause and Effect analysis to find causes and develop prevention actions.
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
11.2.2 Identify RisksTools and Techniques: Checklist Analysis
Checklist Analysis:
Risk identification checklists are developed from previous projects or lessons learned.
Lowest level of the WBS or RBS can be used as checklists. Teams should explore items not on the checklist. It
should be pruned as it is progressively elaborated. Review the checklist during project closure to incorporate
new lessons learned.
Page 180
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11.2.2 Identify Risks
Page 180
Tools and Techniques: Assumption Analysis
Assumption Analysis: explores the accuracy of assumptions and identifies risks to the project from inaccuracy, inconsistency, or incompleteness,
Assumptions involve risk -- identify the risk!
Assumption: a factor in the planning process considered to be true, real, or certain, without proof or demonstration:
• resource, equipment, and facilities availability• external timelines• technology compatibility• interpretation of legal and regulatory constraints
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11.2.2 Identify Risks
Page 181
Tools and Techniques: Diagramming Techniques
Cause & Effect, Ishikawa or Fishbone Diagrams
EFFECTCAUSES
People
Lack of Training
MethodsMaterial
Transport IT System Procedure
Not Following Procedures
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11.2.2 Identify Risks
Page 181
Tools and Techniques: Diagramming Techniques
An Influence Diagram is a visual representation of situationsshowing causal influences, time ordering of events, or otherrelationships among variables.
For example, “Unit sales” is a confluence point. What is theprobability that all activities leading into it and out of it willhappen at the scheduled time? It is a causal influence of risk.
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
11.2.2 Identify RisksTools and Techniques: Diagramming Techniques
Influence Diagram
Project Estimates
Risk Condition
Project Activity
Deliverables
©2013 PMI. A Guide to the Project Management Body of Knowledge (PMBOK® Guide), Fifth Edition
Page 181
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11.2.3 Identify Risks
Page 182
Outputs: Risk Register
Risk Registera document where results of risk analysis and risk response planning are recorded:
List of identified risks
• “EVENT” may occur causing “IMPACT”
• If “CAUSE” exists, “EVENT” may occur leading to “EFFECT”
List of potential responses
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
11.3 Perform Qualitative Risk Analysis
Planning: Project Risk Management
Outputs
Project documents updates
Tools & Techniques
Risk probability and impact assessment
Probability and impact matrixRisk data quality assessmentRisk categorizationRisk urgency assessmentExpert judgment
Inputs
Risk management planScope baselineRisk registerEnterprise environmental factorsOrganizational process assets
Page 183
PMBOK® Fifth Edition, Page 328
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
11.3 Perform Qualitative Risk Analysis
Perform Qualitative Risk Analysisis the process of prioritizing risks for further analysis or action by assessing or combining their probability of occurrence and impact.
The Perform Qualitative Risk Analysis assesses priority of identified risks using “probability/Impact” or “likelihood of occurrence/severity” analysis to determine impact on project objectives if the risks occur.
Page 183
Probability
Impact
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
11.3.1 Perform Qualitative Risk AnalysisInputs
Page 184
• Risk Management Planprovides risk responsibilities, budget/schedule, P/I matrix, stakeholder risk tolerance, etc.
• Scope Baseline (scope statement, WBS, WBS dictionary)
• Risk Register
• EEF and OPA
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
11.3.2 Perform Qualitative Risk AnalysisTools and Techniques, Risk P/I Assessment
Page 184
Risk Probability and Impact Assessment
• Probability is the likelihood that a risk event will occur.
• Impact is the effect (severity) on the objective (scope, schedule, cost, quality, performance) if the risk event occurs.
• These apply to specific risk events, not to the overall project.
• High likelihood and high consequence defines a risk that must be managed aggressively, or must be mitigated.
• Risks with low P/I ratings will be included on a watch list.
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11.3.2 Perform Qualitative Risk AnalysisTools and Techniques, Probability and Impact Matrix
Page 185
Risk Probability and Impact Matrix
• The risk matrix is one of the simplest and most effective tools to analyze risk. It has probability (likelihood) on one axis and impact (consequence or severity) on the other.
• The scales can be either numeric or subjective.
• The organization should determine the threshold of risk that can be tolerated. This will determine: high risk (red light), moderate risk (yellow light), and low risk (green light).
• The score guides risk response actions.
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11.3.2 Perform Qualitative Risk AnalysisTools and Techniques: P/I Matrix
Page 185
Project risk includes both threats to the project’s objectives (negative outcomes) and opportunities to improve on those objectives (positive outcomes) - PMBOK® 5th Edition, 331.
0.90
0.70
0.50
0.30
0.10
0.05
0.04
0.03
0.02
0.01
0.05
0.18
0.14
0.10
0.06
0.02
0.20
0.36
0.28
0.20
0.12
0.04
0.40
0.72
0.56
0.40
0.24
0.08
0.80
0.09
0.07
0.05
0.03
0.01
0.10
0.05
0.04
0.03
0.02
0.01
0.05
0.72
0.56
0.40
0.24
0.08
0.80
0.36
0.28
0.20
0.12
0.04
0.40
0.18
0.14
0.10
0.06
0.02
0.20
0.09
0.07
0.05
0.03
0.01
0.10
Probability Threats Opportunities
Impact (ratio scale) on an Objective
ExamTip
©2013 PMI. A Guide to the Project Management Body of Knowledge (PMBOK® Guide), Fifth Edition
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11.3.2 Perform Qualitative Risk AnalysisTools and Techniques: Risk Matrix
Page 186
HighMediumLow
Likelihood (Probability)
Low
High
Medium
Unacceptable
Managed
Controlled
Risk Legend
Identified, nocontingent plan
Must Mitigate
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11.3.2 Perform Qualitative Risk AnalysisTools and Techniques:
Industry Guidelines
Page 196
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11.3.3 Perform Qualitative Risk AnalysisOutputs: Project Documents Updates
Page 187
Project Documents Updates Risk register
• Assessments of P/I for each risk
• Risk ranking
• Risk categorization
• Watch list for low probability risks
Assumptions log updates
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
11.4 Perform Quantitative Risk Analysis
Planning: Project Risk Management
Outputs
Project documents updates
Tools & Techniques
Data gathering and representation techniques
Quantitative risk analysis and modeling techniques
Expert judgment
Inputs
Risk management planCost management planSchedule management planRisk registerEnterprise environmental factorsOrganizational process assets
Page 188
PMBOK® Fifth Edition, Page 333
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
11.4 Perform Quantitative Risk Analysis
Perform Quantitative Risk Analysis is the process of numerically analyzing the effect of identified risks on overall project objectives.
Perform Quantitative Analysis is used on risks that have been prioritized by qualitative analysis as substantially impacting project objectives.
Page 188
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11.4 Perform Quantitative Risk Analysis
Page 188
Quantitative risk analysis
The Quantitative process analyzes priority risk events and assigns a
numerical rating. It also helps you make decisions in areas of uncertainty.
Quantitative Risk process uses techniques like Monte Carlo Simulationand decision tree analysis to:
★ Quantify outcomes for the project and the probabilities.
★ Assess the probability of achieving project objectives
★ Identify priority risks by quantifying their contribution to overallproject risk.
★ Identify realistic cost, schedule, scope and quality targets, given theproject risks.
★ Determine the best project decision when some outcomes areuncertain.
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
11.4.2 Perform Quantitative Risk Analysis
Page 190
Tools and Techniques: Data Gathering and Representation Techniques
Risk Interview
WBS Element
Build
Test
Total Project
Design
Optimistic PessimisticMost Likely
$4 M $6 M $10 M
$16 M $20 M $35 M
$11 M $15 M $23 M
$31 M $41 M $68 M
Likelihood of completing the project at or below $41 million is relatively low given the range and skew of the simulation results.
©2013 PMI. A Guide to the Project Management Body of Knowledge (PMBOK® Guide), Fifth Edition
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11.4.2 Perform Quantitative Risk Analysis
Page 190
Tools and Techniques: Data Gathering and Representation Techniques
Beta Distribution
60 5 hours with 68% confidence60 10 hours with 95.5% confidence60 20 hours with 99.7% confidence
o = most optimistic cost estimatep = most pessimistic cost estimatem = most likely cost estimate
Ce =o + 4m + p
6
(Ce) = p – o
6
Ce 1 <=> 68% probabilityCe 2 <=> 95.5% probability
Ce 3 <=> 99.7% probability
45 50 55 60 65 70 75 80 8540
3-Point Analysis or
PERT
Hours
Probability Distributions
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11.4.2 Perform Quantitative Risk Analysis
Pages 191-193
Tools and Techniques: Quantitative Risk Analysis and Modeling Techniques
Sensitivity Analysis
Sensitivity Analysis helps determine which risks have the most impact on a project. A typical displayof sensitivity is the tornado diagram, which compares the importance of variables having highuncertainty to those that are more stable.
Expected Monetary Value
Expected Monetary Value (EMV) calculates average outcomes on uncertain future scenarios. TheEMV of opportunities will be positive values, where those of risks may be negative. That is, whenevaluating alternatives during project selection, EMV that is most positive (the higher number) isprobably the best outcome. However, when alternative risks are evaluated, perhaps the lowernumber (minimum risk) is best.
Decision Tree Analysis
Decision Tree Analysis is a common use of EMV analysis. It incorporates the cost of each availablechoice, the probabilities in each path, and the outcomes. Solving the decision tree provides theEMV for each alternative. As said before, in selecting competing projects the higher number maygive the best payback, but in evaluating risk alternatives, the lower number may be best.
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11.4.2 Perform Quantitative Risk Analysis
Page 191
Tools and Techniques: Quantitative Risk Analysis and Modeling Techniques
Sensitivity Analysis: Tornado Diagram
Low High
Var
iab
les
Uncertainty
What is a Tornado Diagram?The purpose of sensitivity analysis is to identify which uncertainty variables have the greatest impact on total value. Why create a Tornado Diagram?The tornado diagram helps identify uncertainties with the highest economic impact. (Risk-Adjusted NPV). 80% of the total uncertainty can be discovered by using the top 5-8 variables in the tornado diagram
(+) Positive Impact(-) Negative Impact
Risk 1
Risk 2
Risk 3
Risk 4
Risk 5
Uncertainty at base Values
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11.4.2 Perform Quantitative Risk Analysis
Page 192
Tools and Techniques: Quantitative Risk Analysis and Modeling Techniques
Expected Monetary Value (EMV)
$ 12,000
$ 10,000
$ 10,200
$ 8,000
$ 12,000
$ 10,000
Select “B” for lowest Risk
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
A Decision Tree : a common use of EMV analysis
New store or renovation?
Flagship store in new mall
(-$1,000,000) Stronger competition(-$50,000)
Increased shopper traffic
(+$100,000)
Renovate existing store
(-$250,000) Dwindling shopper traffic
(-$100,000)
Initial business surge
(+$50,000)
0.6
0.4
0.8
0.2
Exercise
Answer:
-$960,000
-$230,000
Page 192
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013Page 193
EMV is the second most-tested topic on the exam after “the process of risk management”
ExamTip
1. Test yourself:
You are planning modifications to a product line. Below is the complete assessment of risks on the project Calculate the EMV of your budget’s reserve.
• 30% probability that parts delivery will be delayed at a cost of $50,000.
• 20% chance that the parts will be $10,000 less expensive.
• 25% likelihood that two parts will have interference fit, resulting in extra cost of $3,500.
• 30% chance that production will be simpler, saving us $2,500.
• 5% probability that design defects will cause $5,000 in rework.
Exercise
-
+
- - $13,375
+
-
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013Page 193
2. Test yourself on a decision tree:
A
B
What is the EMV of A and B?
Exercise
Answer: $42K+$6K = $48K
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11.4.2 Perform Quantitative Risk Analysis
Page 193
Tools and Techniques: Quantitative Risk Analysis and Modeling Techniques
Modeling and Simulation
Monte Carlo Simulation
The most common simulation technique is Monte Carlo simulation.Earlier in the workbook it was called “What-If” analysis, where acomputer is used to calculate a distribution of possible outcomes forthe total project.
For example, calculate multiple project durations with different setsof activity assumptions and calculate a risk probability distribution.
For cost risk, simulations can use the WBS or cost breakdownstructure as its model.
For schedule risk, simulations use Precedence Diagramming Method(PDM) models.
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11.4.2 Perform Quantitative Risk Analysis
Page 194
Tools and Techniques: Quantitative Risk Analysis and Modeling Techniques
Modeling and Simulation
Uses the network diagram (PDM) and Three-Point Estimates as models to simulate schedule impacts on the project, and the WBS as its model using Three-Point estimates to simulate cost impacts, then “performs” the project several times to determine uncertainty.
• Indicates schedule risk by estimating probability that each task will be on the critical path.
• Accounts for task convergence - calculates increased schedule risk where paths in a network diagram converge into one task.
• Stakeholders (team) estimate cost ranges for each WBS element. Simulation shows probability of meeting the most likely budget estimate.
Monte Carlo Simulation
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Cost
$30 M $38M $47M $56M $65M
Pro
bab
ility
0%
25
%5
0%
75
%1
00
%
$50M
Mean = $46M
$41M
Total Project Cost (cumulative)
The project is only 12% likely to meet the 41 million “most likely” cost estimate. If the organization wants 75% chance of success, $50 million is required (at contingency of 22%, [$50M-41M)/$41M]).
12%
Page 194
11.4.2 Perform Quantitative Risk AnalysisTools and Techniques: Quantitative Risk Analysis and Modeling Techniques
Modeling and Simulation, Cost Risk Simulation
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11.4.2 Perform Quantitative Risk Analysis
Page 195
Monte Carlo Simulation
0 .25 .5 .75 1.0
Road Closed
Running out
of Gas
Getting Stuck
in Snow Drift
0 .25 .5 .75 1.0
Monte Carlo Simulation,
Overall Project Risk
5% Chance That
Probability is 75%
30% Mean Probability
of Project Failure
Tools and Techniques: Quantitative Risk Analysis and Modeling Techniques
Modeling and Simulation
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
11.4.2 Perform Quantitative Risk AnalysisOutputs: Project Documents Updates
Risk Register Updates include: Probability analysis of the project
• confidence levels and distributions are used to calculate cost and time reserves.
Probability of achieving cost and time objectives
Priority list of quantified risks
Trends in risk analysis results
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
11.5 Plan Risk Responses
Planning: Project Risk Management
Outputs
Project management plan updates
Project documents updates
Tools & Techniques
Strategies for negative risks or threats
Strategies for positive risks or opportunities
Contingent response strategies
Expert judgment
Inputs
Risk management planRisk register
Page 196
PMBOK® Fifth Edition, Page 342
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11.5 Plan Risk Responses
Plan Risk Responses is the process of developing options and actions to enhance opportunities and to reduce threats to project objectives
Page 196
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11.5.2 Plan Risk ResponsesTools and Techniques: Strategies for Threats or Opportunities
• AvoidEliminate the threat by eliminating the cause.
• Transfer Contract the risk out. Transfer it to a third party with incentives, penalties, warranties, bonding, .. , purchase insurance.
• MitigateEffect the probability and/or the impact of the risk.
• ExploitEliminate uncertainty of upside risk to ensure opportunity happens
• ShareThird party helps to capture the opportunity
• EnhanceOpposite of Mitigation. Proactively target and reinforce the trigger to achieve a positive opportunity.
• Acceptance Know about the risk, but decide to accept the consequences if failure occurs.
NegativeRisk or Threats
PositiveRisk or
Opportunities
Both
ExamTip
Pages 197-199
• Knowledge and Research Perform tests & simulations. Consult experts. Start risk tasks as early as possible within available slack.
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
11.5.3 Plan Risk ResponsesOutputs: Contingency Reserve, Part of the Risk Register
Page 200
A provision in the project plan to mitigate cost and/or schedule risk
May be calculated as a percent of baseline to allow for overrunsMay be established as a separate fund for unforeseen problemsMay have many different (and application area specific) names:
• management reserve• contingency
May be assigned to any level of the WBS
ExamTip
PMI recommends aminimum totalreserve of 10%
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
11.5.3 Plan Risk ResponsesOutputs: Project Documents Updates
Page 201
Risk Register Updates include: Risk owners and their responsibilities, Agreed response strategies, Actions to implement from the response strategy, Trigger conditions and warning signs of risk occurrence, Budget and schedule activities to implement the response, Contingency plans and triggers that call for their execution, Fallback plans for inadequate risk responses, Residual risks remaining after response has been taken, and those
that have been deliberately accepted, Secondary risks that arise from implementing a risk response, Calculated contingency reserves,
Other Documents Updates: Assumption log updates. Technical documentation updates, Change requests processed
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Chapter 12: Project Procurement Management
Page 202
PMBOK Fifth Edition, Page 355
Knowledge Area
Plan Procurement Management includes the processes necessary to purchase or acquire products, services, or results needed from outside the project
team. It includes contract management and change control processes, as well as administering contracts and obligations under the contracts.
12.1 Plan Procurement Management: Documenting purchase decisions, specifying the approach, and identifying potential sellers.
12,2 Conduct Procurements: Obtaining seller responses, selecting a seller, and awarding a contract.
12.3 Administer Procurements: Managing procurement relationships, monitoring contract performance, and making changes and corrections as needed.
12.4 Close Procurements: Competing each project procurement.
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Chapter 12: Project Procurement Management
Page 202
Make or Buy
RFP/RFQ Issued
Proposal Received
Contract Award
Substantive Completion
Q&A
Procurement Process
Plan Purchases & Acquisitions
Plan Contracting
Request Seller
Responses
Select Sellers
Contract Administration
Contract Closure
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
12.1 Plan Procurements
Planning: Plan Procurement Management
Outputs
Procurement management plan
Procurement statement of work
Procurement documentsSource selection criteriaMake-or-buy decisionsChange requestsProject documents updates
Tools & Techniques
Make-or-buy analysisExpert judgmentMarket researchMeetings
Inputs
Project management planRequirements documentationRisk registerActivity resource requirementsProject scheduleActivity cost estimatesStakeholder registerEnterprise environmental
factorsOrganizational process
assets
Page 203
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
12.1 Plan Procurement Management
Plan Procurement Management is the process of documenting project purchasing decisions, specifying the approach and identifying potential sellers.
The plan procurements process involves deciding whether to “make-or-buy”, the consideration of potential sellers, and the consideration of the risks involved
PMBOK® Fifth Edition, Page 358
Page 202
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Contract TypesThere are several contract types that may be used, and the contract type determines how the
risk is shared between the buyer and the seller.
12.1.2 Plan Procurement ManagementInputs: Organizational Process Assets
Page 204-206
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12.1.2 Plan Procurement Management
Fixed Price/Lump Sum Contracts: • Firm Fixed Price (FFP)• Fixed Price Incentive Fee (FPIF)• Fixed Price with an Economic Price
Adjustment (FP-EPA)
Cost Reimbursable Contracts:
Unit Price or Time & Materials Contracts (T&M)
• Cost Plus Fixed Fee (CPFF)• Cost Plus Incentive Fee (CPIF)• Cost Plus Award Fee (CPAF)
Contracts are risk mitigation tools Other professionals may handle the contract, but contracts
should not be created before the PM is assigned Match the contract type to the type of project Contract type will determine the balance of financial risk between
the buyer and the supplier.
Page 204-207
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12.1.2 Plan Procurement Management
Page 207
Fixed Price (or Lump Sum) Type Contracts:
Cost Reimbursable Type Contracts:
Time & Materials Type Contracts:
Used on development projects for flexibility. Cost risk is on the buyer, so establish administrative & reporting systems to allow both buyer and seller visibility into costs. (Includes CPFF, CPIF, CPAF)
Used on well specified projects for which costs can be accurately estimated. Cost risk is on the supplier. (includes FFP, FPIF, FP-EPA)
Used on projects where the deliverables are well defined, repetitive units but the quantities are not yet known (e.g., identical pieces of equipment, or labor hours and associated material costs – includes overhead and burden)
ExamTip
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12.1.2 Plan Procurement Management
Page 208
FFP
FPEPA
FPAF
FPIS
FPIF
CPIF
CPAF
CS
CPFF
COST
Client, Customeror Buyer
Contractoror Seller
0%
100% 0%
100%
RISK
On the exam, contract questions are written
from the buyer’s perspective
RISK
Inputs: Organizational Process Assets
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013Page 208
FFP
FPEPA
FPAF
FPIS
FPIF
CPIF
CPAF
CS
CPFF
COST
Firm Fixed Price: A negotiated fixed price to produce the good or service.
Fixed Price with Economic Price Adjustment: Unstable market or labor conditions, price can be adjusted up or down with a ceiling
Fixed Price Award Fee: award amount related to a subjective judgment of the quality of the contractor's performance.
Fixed Price Incentive (Successive Targets): Contains production point (s) at which either a firm target and final profit formula can be negotiated.
Fixed Price Incentive (Fee or Firm Target): target profit, and profit sharing formula are negotiated into contract, profit is adjusted upon contract completion.
Cost Plus Incentive Fee: positive profit incentives are negotiated.
Cost Plus Award Fee: Award fee is earned for performance, quality, timeliness, and cost effectiveness and can be earned in whole or in part.
Cost Plus a Fixed Fee: Level of effort is unknown, fee is expressed as percentage of estimated cost at time contract is awarded.
Cost Sharing: Development or research projects, contractor sees a commercial benefit which they accept in lieu of fee.
Cost: Typically for R&D with nonprofit organizations, educational institutions, and facilities contracts.
US Federal Acquisition Regulations (FAR 16.104)12.1.2 Plan Procurements Inputs: OPA
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12.1.2 Plan Procurement ManagementTools and Techniques: Budget Implications
Page 209
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12.1.2 Plan Procurement ManagementTools and Techniques: Profit or Fees for Different Contracts
Page 209
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12.1.2 Plan Procurement ManagementTools and Techniques: Point of Total Assumption
Page 209
ExamTip
Is on the exam
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013Page 210
Cost Plus Incentive Fee Calculation
Target cost $210,000Target fee $ 25,000Target price $235,000
Sharing ratio 80/20Actual cost $200,000
Fee
Final Price
$210,000 - $200,000 = $10,000 x 20% = $2000
$25,000 target fee + $2,000 = $27,000 fee
$200,000 + $27,000 = $227,000
Incentive Fee Calculation
Exercise
You may have to calculate both the Fee and the Final Price for the Exam!
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
12.1.2 Plan Procurement ManagementTools and Techniques:
Make-or-Buy AnalysisA general management technique to determine whether work is best done by the project
team or purchased from an outside source. Considerations such as capability, risk, budget and schedule are all considered as well as whether to purchase, lease or rent
Expert JudgmentExperts may be used in several areas. Technical experts will assess capability, inputs and
outputs. Purchasing experts will generate the criteria to select appropriate sellers, and legal experts will focus on terms, conditions and issues
Market ResearchCapabilities of industry and seller must be researched by information gained at conferences,
on-line, and other sources. Leverage mature technologies while balancing the risks with other less mature technologies.
Page 206
MeetingsInformation exchange with potential bidders can benefit the project.
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
12.1.3 Plan Procurement ManagementOutputs: Procurement Management Plan, and
Procurement Statement of Work
Page 211
• Provides the basis of agreement between buyer and supplier
• Sufficient detail to allow prospective suppliers to determine whether or not they can comply
• Sufficient latitude for creative solutions only if appropriate
• Each procurement requires a separate SOW. But one SOW may cover many items in a single procurement
• May be revised as the procurement progresses
• Should be clear, concise, and unambiguous
• May be developed by the project team or supporting offices (or even the seller) depending on policy and ability
• Your best defense against procurement scope creep!
A narrative description of products or services to be supplied under contract.
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
12.1.3 Plan Procurement ManagementOutputs: Procurement Documents
Page 212
Procurement documents from the buyer:
TECHNICALLY-DRIVEN CONTRACTS:
• Request for Proposal (RFP) - requests a detailed proposal on how thework will be done, who will do it, . . . , basically a Project Execution Planfrom the contractor or seller.
PRICE-DRIVEN CONTRACTS:
• Invitation for Bid (IFB, or RFB) - requests one price to do all the work.
• Request for Quotation (RFQ) - Requests a price quote per item, per hourcharges, etc.
Procurement Terminology is not universal
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Understanding of need
Life-cycle cost Technical capability
Risk Management approach
Technical approach
Warranty Financial stability
Production capacity
Business size and type
Past performance
of sellers
References Intellectual property rights
Proprietary rights
Examples of source selection criteria are:
12.1.3 Plan Procurement ManagementOutputs: Source Selection Criteria
• The Contracting Officer or Administrator is the one with authority to change the contract• The Project Manager must understand the contract and manage its completion• The exam tests conflicts that arise between the two
ExamTip
Page 212
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Notes on procurement for the exam
• The exam questions are always from the buyer’s perspective
• Different words are sometimes used (vendor, owner, contractor, subcontractor etc.)
• A contract is a formal agreement• All requirements should be specifically stated in
the contract• Changes must be in writing and formally
controlled• The US Government backs all contracts by
providing a court system (this is a US exam)
Page 213
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13.2 Plan Stakeholder Management
Planning: Project Stakeholder Management
Outputs
Stakeholder management plan
Project documents updates
Tools & Techniques
Expert judgmentMeetingsAnalytical techniques
Inputs
Project management planStakeholder registerEnterprise environmental factorsOrganizational process assets
Page 314
PMBOK® Fifth Edition, Section 13.2, Page 393
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
13.2 Plan Stakeholder Management
Plan Stakeholder Management is the process of developing management strategies to engage stakeholders throughout the project life cycle, based on the analysis of their needs, interests, and impact on project success.
It allows the project manager the develop ways to engage stakeholders in the project, to manage their expectations, and to achieve the project objectives.
Page 214
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13.2 Plan Stakeholder Management Tools and Techniques: Analytical Techniques
Engagement level of the stakeholders can be classified as follows:
• Unaware. of project and potential impacts
• Resistant. Aware of project and impacts, and resistant to change
• Neutral. Aware of project yet neither supportive nor resistant
• Supportive. Aware of project/impacts and supportive to change
• Leading. Aware of project/impacts and actively engaged in ensuring success.
Engagement Level of Stakeholders
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013Page 216
13.2 Plan Stakeholder Management Tools and Techniques: Analytical Techniques
Stakeholder Engagement Assessment Matrix
ExamTip
Stakeholder
Stakeholder 1
LeadingSupportiveNeutralResistantUnaware
Stakeholder 2
Stakeholder 3
C
C
D
D
D C
Legend: “C” = Current Engagement“D” = Desired Engagement
©2013 PMI. A Guide to the Project Management Body of Knowledge (PMBOK® Guide), Fifth Edition
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013Page 217
13.2 Plan Stakeholder Management Outputs: Stakeholder Management Plan
This plan identifies the management strategies required to engage stakeholders.
• Desired engagement levels of key stakeholders,
• Scope and impact of change to stakeholders,
• Interrelationships and overlap between stakeholders,
• Stakeholder communication requirements for the current phase,
• Information to be distributed to stakeholders (language, format, content, level of detail),
• Timing and frequency for distributing the information,
• Method for updating the stakeholder management plan as the project progresses.
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Executing Process Group
Page 219
PMBOK® Fifth Edition, Page 79
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013Page 28
Process Groups
Knowledge AreasInitiating Planning Executing Closing
Monitoring &
Controlling
4. Project IntegrationManagement
4.2 Develop ProjectManagement Plan
4.3 Direct & Manage 4.4 Mon/Ctrl Proj Work4.5 Perform Integrated
Change Control
5. Project ScopeManagement
5.1
Collect Requirements5.2
Define Scope
5.5 Validate Scope
5.6 Control Scope
6. Project TimeManagement
6.1
Define Activities6.2Sequence Activities6.3Est. Activity ResourcesEst. Activity Durations6.5Dev. Schedule
6.7 Control Schedule
7. Project CostManagement
7.2 Estimate Costs
7.3 Determine Budget
7.4 Control Costs
8. Project QualityManagement
8.1 Plan Quality Mgt. 8.2 Perform Quality
Assurance8.3 Control Quality
9. Project HumanResourceManagement
9.1 Plan Human
Resource Mgt.9.2 Acquire Project Team
9.3 Develop Project Team
9.4 Manage Project Team
10. ProjectCommunicationsManagement
10.1 Plan Communications
Management 10.2 Manage Communications
11. Project RiskManagement
11.1 Plan Risk Management
11.2 Identify Risks
11.3 Perform QualitativeRisk Analysis
11.4 Perform QuantitativeRisk Analysis
11.5 Plan Risk Response
11.6 Control Risks
12. Project ProcurementManagement
12.1 Plan Procurement Mgt. 12.2 Conduct Procurements 12.3 Control Procurements 12.4 Close Procurements
Project Work 4.1 Develop Project Charter
13.1 Identify Stakeholders
5.4 Create WBS
6.4
4.6 Close Project
or Phase
13.3 Manage Stakeholder
Engagement
13.4 Control Stakeholder
Engagement
Plan Scope Mgt.
5.3
Plan Schedule Mgt.
6.6
7.1 Plan Cost Mgt.
10.3 Control Communications
13. Project Stakeholder
Management13.2 Plan Stakeholder
Management
PMBOK® Fifth Edition, Page 61
Executing
4.3 Direct and Manage Project Work
8.2 Perform Quality Assurance9.2 Acquire Project Team9.3 Develop Project Team9.4 Manage Project Team10.2 Manage Communications12.2 Conduct Procurements13.3 Manage Stakeholder
Engagement
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
4.3 Direct and Manage Project Work
Executing: Integration Management
Outputs
DeliverablesWork performance dataChange requestsProject management plan
updatesProject documents updates
Tools & Techniques
Expert judgmentProject management
information systemMeetings
Inputs
Project management planApproved change requestsEnterprise environmental factorsOrganizational process assets
Page 220
PMBOK® Fifth Edition, Page 79
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
4.3 Direct and Manage Project Work
Direct and Manage Project Workis the process of leading and performing the work defined in the project management plan and implementing approved changes to achieve the project’s objectives
Page 220
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
The activities of Direct and Manage Project Work include:
• Perform activities to accomplish project objectives,• Create deliverables,• Provide, train, and manage team members• Obtain materials, equipment, and facilities,• Implement methods and standards,• Establish communication channels,• Generate project date: cost schedule, technical, quality, and status to
facilitate forecasting,• Issue change requests and manage approved changes
(corrective action, preventative action, defect repair),• Manage risks and risk responses,• Manage sellers and contractors,• Manage stakeholders and their engagement, and • Collect and document lessons learned
Page 220
4.3 Direct and Manage Project Work
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
The other 23 planning processes are integrated to createthe project management plan. Updates to any plansrequire an update to the PM plan. Think of the PM plan asa bucket into which all the other plans “drip” until it is full.
Inputs: The Project Management Plan
Page 221
4.3.1 Direct and Manage Project Work
Plan Scope Management Collect Requirements Define Scope Create WBS Plan Schedule Management Define Activities Sequence Activities Estimate Activity Resources Estimate Activity Durations Develop Schedule Plan Cost Management Estimate Costs
Determine Budget Plan Quality Management Plan Human Resource Management Plan Communications Management Plan Risk Management Identify Risks Perform Qualitative Risk Analysis Perform Quantitative Risk Analysis Plan Risk Responses Plan Procurement Management Plan Stakeholder Management
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4.3.2 Direct and Manage Project Work
Page 222
Tools and Techniques
Expertise is provided by the project manager and the PM team, and additional knowledge can be gained from a variety of sources inside and outside of the organization.
PM Information System (PMIS)The PMIS provides access to tools: scheduling tool, work authorization system, configuration management system, information collection/distribution system, reporting on key performance indicators (KPI), and interfaces to online automated systems.
MeetingsMeetings can include information exchange, brainstorming, option evaluation, or decision making. Meetings are most effective when face-to-face. Virtual meetings (audio or video-conferencing) require additional preparation and organization to be as effective as face-to-face.
Expert Judgment
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
4.3.3 Direct and Manage Project Work
Page 223
Outputs
DeliverablesAny product, result or service identified in the PM Plan produced during project execution.
Work Performance InformationStatus of project activities is routinely collected. It includes schedule progress, deliverable status, quality requirements met, costs incurred, estimates to complete, lessons learned, and resources used.
Change RequestsChanges are requested to expand or reduce scope, modify policies/procedures, costs, budgets, quality, or schedules. They also include corrective action, preventative action, defect repair, and document updates.
PM Plan UpdatesRequirements, schedule, cost, quality, HR, communications, risk, procurement, and the project baselines.
Project Document Updates: requirements, logs, risk register, and stakeholder register.
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
8.2 Perform Quality Assurance
Executing: Quality Management
Outputs
Change requestsProject management plan
updatesProject document updatesOrganizational process assets
updates
Tools & Techniques
Quality management and Control tools
Quality auditsProcess analysis
Inputs
Quality management planProcess Improvement planQuality metricsQuality control measurementsProject documents
Page 224
PMBOK® Fifth Edition, Page 242
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
8.2 Perform Quality Assurance
Perform Quality Assurance isthe process of auditing thequality requirements and theresults from quality controlmeasurements to ensureappropriate quality standardsand operational definitionsare used
Page 224
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
8.2.2 Perform Quality Assurance
Page 225
Tools and Techniques: Quality Management and Control Tools
• Flowcharting• Brainstorming • Force Field Analysis• Nominal Group Techniques• Matrix Diagrams• Priority Matrixes
• Benefit/Cost Analysis• Cost of Quality (COQ)• Control Charts• Benchmarking• Design of Experiments (DOE)• Statistical Sampling• Proprietary Methods
The Tools for Quality Planning should be used for Quality Assurance
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
8.2.2 Perform Quality Assurance
Page 225
• Prioritization Matrices• Activity Network Diagrams• Matrix Diagrams
• Affinity Diagrams• Process Decision Program
Charts (PDPC)• Interrelationship Digraphs• Tree Diagrams
In Addition, Use the Seven Quality Management and Control Tools
Tools and Techniques: Quality Management and Control Tools
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013Page 226
The Seven Quality Management and Control Tools
Affinity Diagram PDPC Interrelationship Digraph
Tree Diagrams Prioritization Matrices
Matrix Diagrams
No Yes YesNo No No
Start Finish
A B C
D E F
1Start Finish
B
C
D
E
F
2
4 5
3
6
F
PDM
ADM
Network Diagrams
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
8.2.2 Perform Quality Assurance
Pages 227
Quality Control (QC): a process of monitoring and recording results (both product
and project management) of executing quality activities to assess performance andto recommend necessary changes. Involves identifying ways to remove the causes ofquality defects.
Quality control involves inspection and requires an understanding of samplingstrategies, tolerances, and the causes of variation in a process. It is done in theMonitoring and Controlling Processes.
Tools and Techniques: Quality Audits
Quality Assurance (QA): the process of auditing quality requirements, and the
results from quality control (QC) measurements, to ensure quality standards andoperational definitions are used..
Quality assurance involves Quality Audits, and is done in Execution Processes.
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
8.2.1 Perform Quality Assurance
Page 228
Tools and Techniques: Quality Audits
. . a structured review (audit) of the project’s quality management activities to determine if they comply with organizational and project
policies, processes, and procedures.
• Quality audits may be random or scheduled• Quality audits may be performed internally or externally
Quality audits Identify best practices and gaps or shortcomings Share good practices with similar projects in the organization Proactively assist to improve processes and raise team productivity Contribute audit results to lessons learned archives.
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Turn to page 416 in the workbookThere are 68 questions.
You have 81 minutes to completeAnswers are on page 433
Page 416
Hint: Use scratch paper for answers,so you can reuse the questions for practice
Practice Test #2
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
9.2 Acquire Project Team
Executing: Human Resource Management
Outputs
Project staff assignmentsResource calendarsProject management plan
updates
Tools & Techniques
Pre-assignmentNegotiationAcquisitionVirtual teamsMulti-criteria decision
analysis
Inputs
Human resources management plan
Enterprise environmental factorsOrganization process assets
Page 230
PMBOK® Fifth Edition, Page 267
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
9.2 Acquire Project Team
Acquire Project Team is the process of confirming human resource availability and obtaining the team necessary to complete project activities
Page 230
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
9.2.1 Acquire Project TeamInputs: Project Management Plan, that includes:
Page 231
• Human Resource Management Plan
defining positions, skills, and competencies
project organization charts
when team members are needed
• EEF and OPA
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
9.2.2 Acquire Project TeamTools and Techniques
Pre-AssignmentProject team members are selected in advance, perhaps where the project is part of
a proposal
NegotiationThe project manager may need to negotiate with functional managers or other
project managers to gain the staff required
AcquisitionHiring or subcontracting team members from outside sources. This may involve
outsourcing work to another organization
Virtual TeamsTeams where the members may not be able to meet face-to-face because of
geographic or mobility limitations. Communication planning becomes increasingly important in a virtual team environment
The project manager should effectively negotiate and influence others who are in a position to provide the required human resources for the project
Pages 232-233
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
9.2.2 Acquire Project TeamTools and Techniques
Pages 233
Multi-Criteria Decision Analysis
Criteria are used to rate potential team members. The criteria are weighted by considering relative importance within the team.
• Availability. Is the team member available to work in the time period needed?• Cost. Is the team member’s cost within the budget constraints?• Experience. Have the people done similar work before? Done it well?• Ability. Does the team member have the required competence?• Knowledge. Does the team member know the customer, worked on similar
projects, understand PM?• Skills. Can they use project tools, or have appropriate training?• Attitude. Can the team member work with others in a cohesive team?• International Factors. What is the location of the team member, time zones,
communication skills?
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
9.3 Develop Project Team
Executing: Human Resource Management
Outputs
Team performance assessments
Enterprise environmental factors updates
Tools & Techniques
Interpersonal skillsTrainingTeam-building activitiesGround rulesCo-locationRecognition and rewardsPersonnel assessment tools
Inputs
Human resource management plan
Project staff assignmentsResource calendars
Page 235
PMBOK® Fifth Edition, Page 273
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
9.3 Develop Project Team
Develop Project Team is the process of improving the competencies, team interaction and the overall team environment to enhance project performance. Teamwork is a critical factor for project success, and developing effective project teams is one of the primary responsibilities of the project manager
Page 235
ExamTip
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Interpersonal Skills: “soft skills”
Training: activities designed to improve competencies of the project team members
Team-Building Activities: should be designed to help individual team members work together effectively and establish good working relationships.
9.3.2 Develop Project TeamTools and Techniques:
Pages 236-237
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
9.3.2 Develop Project Team
Page 238
Tools and Techniques: Team Building Activities
Bruce Tuckman: The Five Stages of Team Development
• Forming: Team meets, learns about the project, understands
roles, but is independent, not open
• Storming: Team addresses project and methodology and must
be open in this phase or it can become destructive.
• Norming: Team works together, adjusts behaviors that are
supportive, and trust develops
• Performing: Team performs as well organized unit and works
through issues smoothly and effectively
• Adjourning: Team completes the work, celebrates their success,
and moves on from the project.
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
9.3.2 Develop Project Team
Page 238
Tools and Techniques: Team Building Activities
The proper use of most project management tools & techniques contribute to teambuilding, but PMI defines “Team Building Activities” as “actions taken specifically and primarily to improve team performance.”
• Facilitated off-site workshops• Inter-personal skills development
training and workshops• Communications training
(including listening skills)• Conflict resolution• Psychological preference
indicators such as Myers-Briggs• Physical challenge workshops• Planned team outings• Standing agenda item at review
meetings • Shared space, publicity, and
symbols to create a team identity
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Ground Rules: Discussing ground rules allows team members to discover values important to one another, to set clear expectation for team behavior, and to share their commitment to the rules
Co-location: Physically locating team members in the same physical location enhances team communication and performance
Recognition and Rewards: Promote and reinforce desired
behaviors, and only desired behavior should be rewarded.
“What gets measured, gets done”
9.3.2 Develop Project TeamOther Tools and Techniques
Page 239
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
9.3.2 Develop Project TeamTools and Techniques: Recognition and Rewards
Page 239 & 241
Self Actualization = Achievement
Self Esteem = Recognition
Social
Safety
Physiological
Maslow’s Hierarchy of Needs
ExamTip
Herzberg’s Motivators
1. Achievement
2. Recognition
3. Work Itself
4. Responsibility
5. Advancement
6. Growth
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
9.3.2 Develop Project TeamTools and Techniques: Recognition and Rewards
Page 239
ExamTip
McClelland’s “Theory of
Needs”
Achievement
Affiliation
Power
A person’s motivation and effectiveness are influenced by three needs:
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
9.3.2 Develop Project TeamTools and Techniques: Recognition and Rewards
Be sure the link between performance and reward is clear, explicit, timely, and achievable.
Be sure to reward desired behaviors more than recovery from the results of undesired behaviors.
Consider cultural factors such as individualism vs. collectivism in choosing rewards and giving recognition (team vs. personal).
• prized assignments• responsibility• presentation opportunities• training opportunities-growth• flexible scheduling/days off
• Recognition of achievement• better offices, new
equipment• bonuses, trips• promotions, pay raises
A
Page 240
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013Page 240
Outputs: Team Performance Assessments
Position Descriptions
show team member responsibilities, authority, competencies, and qualifications outlined in a text document.
9.3.3 Develop Project Team
improvements in individual skills
Improvements in team behaviors
improvements in project performance
reduced staff turnover rate.
Performance Assessments
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
9.4 Manage Project Team
Executing: Human Resource Management
Outputs
Change requestsProject management plan
updatesProject documents updatesEnterprise environmental
factors updatesOrganizational process assets
updates
Tools & Techniques
Observation and conversationProject performance appraisalsConflict managementInterpersonal skills
Inputs
Human resource management plan
Project staff assignmentsTeam performance assessmentsIssue logWork performance reportsOrganizational process assets
Page 242
PMBOK® Fifth Edition, Page 279
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
9.4 Manage Project Team
Manage Project Teamis the process of tracking team member performance, providing feedback, resolving issues and managing team changes to optimize project performance
Page 242
Team members are accountable both to their functional manager and to their project manager.
Effective Management of the dual reporting relationship is the responsibility of the Project Manager
ExamTip
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
9.4.1 Manage Project Team
Page 242-243
Inputs:
• Human Resource Management Planresponsibilities, project organization, staffing management plan.
• Project Staff Assignments
• Team Performance Assessments
• Issue Log
• Work Performance Reportsproject status, project forecasts, schedule/cost/quality control, scope validation, future HR requirements
• Scope Baseline (scope statement, WBS, WBS dictionary)
• OPA
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
9.4.2 Manage Project Team
Fill in the last column with PM (Project Manager), T (Team member) or SM (Senior/Functional Management) as to who is most appropriate to solve the problem listed under the “situation” column. Understanding of these questions will help with your with your Situation Questions:
Situation Who Solves the Problem (PM/T/SM)?
1 Two project team members are having a disagreement -
2 There is a change to the overall project deliverables –
3 A boss is trying to pull a team member off the project to do other work –
4 The project manager does not have the authority to get things done –
5 There are not enough resources to complete the project –
6 The team is unsure of what needs to happen when –
7 A task needs more time and will cause the project to be delayed –
8 A tasks needs more time without causing the project to be delayed –
T
SM
SM
PM
SM
PM
T
SM
Tools and Techniques: Project Performance Appraisals, Roles and Responsibilities
Exercise
Page 245
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
9.4.2 Manage Project TeamTools and Techniques: Project Performance Appraisals, Roles and Responsibilities
Exercise
9 A team member is not performing -
10 The team is not sure who is in charge of the project –
11 There is a talk that the project may be no longer needed –
12 Senior management provides an unrealistic schedule requirement –
13 The team is in conflict over priorities between tasks –
14 The project is behind schedule –
15 A team member determines that another method is needed to complete the task within its scope of work -
SM
SM
PM
PM
T
SM
SM
Page 245
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
9.4.2 Manage Project TeamTools and Techniques: Powers of a Project Manager
Page 246
ExamTip
Powers of the P.M. How Earned?
Expert: recognition by others On your own
Reward: giving rewards to others PM’s Position
Formal: power based on the position PM’s Position
Referent: refer to authority of management Other’s Position
Penalty: ability to penalize team members PM’s Position
Principles of Project Management, PMI, ISBN: 1-880410-30-3
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
9.4.2 Manage Project TeamTools and Techniques: Conflict Management
Page 246
ExamTip
Conflict ResolutionBest to Worst
1. Collaborate/Problem Solving: solving the real problem2. Compromise/Reconcile: solutions that satisfy all parties3. Withdraw/Avoid: retreating or postponing a decision4. Smooth/Accommodate: emphasis on agreement rather than differences5. Force/Direct: one viewpoint at the expense of another
Principles of Project Management, PMI, ISBN: 1-880410-30-3
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9.4.2 Manage Project Team
Page 246
ExamTip
Factors for Conflict Resolution
• Importance and intensity of conflict
• Time pressure to resolve
• Position taken by persons involved
• Motivation to resolve, long and short term
Tools and Techniques: Conflict Management
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
9.4.2 Manage Project TeamTools and Techniques: Conflict Management
Page 247
Sources of Conflict(order of priority)
1. Schedules
2. Project priorities
3. Resources
4. Technical opinions
5. Admin. Procedures
6. Cost
7. Personality
ExamTip
Principles of Project Management, PMI, ISBN: 1-880410-30-3
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
9.4.2 Manage Project TeamTools and Techniques: Interpersonal Skills
Page 247
The Fourth Edition was the first time the “soft skills” have been givenspecial recognition by PMI in the guidebook.
Please refer to Appendix X3 in the Fifth Edition for a listing ofinterpersonal skills important to project management. PMI said theseskills were too large to cover in-depth in the PMBOK. This makes it a ripesource for questions on the fifth edition test.
ExamTip
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
9.4.2 Manage Project TeamTools and Techniques: Leadership
Page 248
Leadership focuses team efforts toward a common goal. Leaders getthings done through other people. They develop trust and respect, notfear and submission.
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
9.4.2 Manage Project TeamTools and Techniques: Leadership, the Team Performance Curve
Page 249
Team Effectiveness
Perf
orm
ance Im
pact
Pseudo-Team
Working Group
Potential Team
Real Team
High-PerformanceTeam
Katzenbach and Smith“The Wisdom of Teams”
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
A high performing team is:
• A small group of people
• with complimentary skills
• committed to a common
purpose, performance goals and methods
• for which they hold themselves accountable
• and take the risk of conflict
Page 236 and 249
9.3.2 Develop Project TeamTools and Techniques: Team Building Activities
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
9.4.2 Manage Project TeamTools and Techniques: Communication and Influencing
Page 250
Communication is one of the biggest contributors to project success or failure.
• Geert Hofstede: Cultural Dimensions (national cultural differences)• Myers Briggs: “Personality Test”• The “Sender-Receiver Model” (mentioned earlier)• Conflict resolution is part of communication (mentioned earlier)
Communication
• Lead by example, follow through with commitments• Clarify how decisions will be made• Use a flexible style, adjust to the situation (Situational Leadership)• Apply your power skillfully and cautiously
Influencing
“Influence: What you think you have until your try to use it” Joan Welsh
ExamTip
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
9.4.2 Manage Project TeamTools and Techniques: Decision Making
Page 251
• Command• Consultation• Consensus• Random (coin flip)
Decision Making Styles Factors Affecting Style
• Time constraints• Trust• Quality• Acceptance
1. Problem Definition: explore, clarify, and define the problem
2. Solution Generation: brainstorm solutions and discourage early decisions
3. Ideas to Actions: define evaluation criteria, rate pros/cons, select one
4. Solution Plan: involve team for acceptance and commitment
5. Evaluation Plan: implement, analyze, evaluate, lessons learned
6. Evaluation Outcome: was the problem solved? Goals achieved?
Six-Phase Problem Solving Model
ExamTip
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
9.4.2 Manage Project TeamTools and Techniques: Negotiation
Page 250-251
Negotiating Skills and Behaviors
1. Analyze the situation
2. Differentiate between wants and needs by both parties
3. Focus on interests and issues, not positions
4. Ask high and offer low (but be realistic). Do you have a BAFO?
5. When making a concession, act like you are yielding something of value. Don’t just give in.
6. Both parties should feel like they won (win-win). Never let the other party leave feeling they have lost.
7. Do a good job of active listening and articulating
ExamTip
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
9.4.2 Manage Project TeamTools and Techniques: Appendix X3, Covey, Dinsmore, Levin, Verma
Page 252
Seven Habits of Highly Effective People
Habit 1: Be Proactive: Principles of Personal Choice Habit 2: Begin with the End in Mind: Principles of Personal Vision Habit 3: Put First Things First: Principles of Integrity & Execution Habit 4: Think Win/Win: Principles of Mutual Benefit Habit 5: Seek First to Understand, Then to be Understood Habit 6: Synergize: Principles of Creative Cooperation Habit 7: Sharpen the Saw: Principles of Balanced Self-Renewal
(The Eighth Habit: “From Effectiveness to Greatness”; Find your voice and inspire others to find theirs)
ExamTip
Stephen R. Covey, 2004
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
9.4.2 Manage Project TeamTools and Techniques: Trust Building
Page 253
ExamTip
• Open and direct communications to resolve problems
• Inform all stakeholders when commitments are at risk
• Engage directly with the team, ask a lot of questions
• Be direct and explicit about what you need or expect
• Do not withhold information
• Be receptive to innovation
• Look beyond your own interests
• Demonstrate true concern for others
Trust Building
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
10.2 Manage Communications
Executing: Communications Management
Outputs
Project communicationsPM plan updatesProject documents updatesOrganizational process assets
updates
Tools & Techniques
Communication technologyCommunication modelsCommunication methodsInformation management
systemsPerformance reporting
Inputs
Communications management plan
Work performance reportsEnterprise environmental factorsOrganizational process assets
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10.2 Manage Communications
Manage Communications is the process of creating, collecting, distributing, storing, retrieving, and the ultimate disposition of project information in accordance with the Communications Management Plan.
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Communication Management Plan
describes how communications will be planned,
structured, monitored and controlled.
Stakeholder communication requirements
Which information flows from whom, when, via which media, and in what format.
Schedule and frequency for information collection and distribution.
Methods to convey information (memos, e-mail, press releases, etc.)
Resources for communication activities, including time and budget
Problem escalation procedure
Method for updating the communication plan
Flow charts of information flow
List of reports and meetings planned (schedule and attendees)
Communications constraints
“Communications infrastructure” for the project (who may talk to whom)
Page 256
Inputs: Includes the Communications Management PlanInputs:
10.2.1 Manage Communications
Performance Reports
• Organizes and summarizes information on project
status and progress
• May have different reports for different stakeholders,
each to the level of detail and in the format and
frequency appropriate to the stakeholder
Caution: Ensure a consistent “data date”,
ideally from a common set of data
• Includes cost, schedule, quality and scope accomplishment and variance
information
• Reports the results of variance analysis, trend analysis, and earned value
analysis. Generally involves charts such as bar charts (e.g., Gantt charts)
and S-curves (e.g., earned value charts) to summarize data and facilitate
reporting by exception.
Performance Reports
Guidelines for Performance Reports:
• keep the report short, matching its length to the projects’ complexity and the audience’s needs
• use a consistent template and format
• use visual elements such as charts and graphs
Criteria for Performance Reporting:
• gives timely, complete, and accurate information
• doesn’t add more administrative overhead than it’s worth
• is acceptable and useful to all participants
• gives warning of problems in time for preventive or corrective actions
• is easily understood by those who have a need to know
Purpose of Performance Reports:
• to detect problems in time to take corrective or preventive action
• to reduce customer and management anxiety
• to share project information within the project team
More on these reports later . . .
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Tools and Techniques
10.2.2 Manage Communications
Communication TechnologyTechnology can vary from project-to-project and throughout the life cycle of the same project. The team must ensure that the technology is appropriate for the information being communicated.
Communication ModelsThe choice of communication model must be appropriate for the project and any barriers (noise) are identified and managed.
Communications MethodsMethods to communicate can take place through many media. Effective and efficient use of each requires appropriate communication skills: Written and oral, listening and speaking Internal (in the project) and external (client, public) Formal (reports) and informal (memos, e-mail, IM, telecon) Vertical (up/down the org.) and horizontal (with peers)
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Tools and Techniques
10.2.2 Manage Communications
Information Management SystemsA variety of tools are available for managing and distributing information:• Hard copy documents: letters, memos, reports, and press releases• Electronic communication media: e-mail, fax, IM, voice mail, telephone, video, web
conferencing, web sites, web publishing, FTP sites, intranet• Electronic PM tools: web interfaces for scheduling , PM software, Skype, meeting software,
virtual office software, portals, and collaborative work management tools.
Performance ReportingThis is collecting and distributing performance information (status reports, progress measurements, and forecasts). It includes periodic analysis of baseline versus actual data to communicate progress and to forecast project results. Simple reports show percent complete or status dashboards (scope, schedule, cost, quality). More elaborate reports may include:• Analysis of past performance• Analysis of forecasts (including time and cost)• Status of risks and issues• Work completed during the period• Work to be completed during the next period
• Summary of changes approved, etc.
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
12.2 Conduct Procurements
Executing: Procurement Management
Outputs
Selected sellersAgreementsResource calendarsChange requestsProject management plan
updatesProject documents updates
Tools & Techniques
Bidder conferencesProposal evaluation
techniquesIndependent estimatesExpert judgmentAdvertisingAnalytical techniquesProcurement negotiations
Inputs
Project management planProcurement documentsSource selection criteriaSeller proposalsProject documentsMake-or-buy decisionsProcurement statement of workOrganizational process assets
Page 260
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12.2 Conduct Procurements
Conduct Procurements is the process of obtaining seller responses, selecting a seller and awarding a contract.
It may involve developing a short list of qualified sellers which are then subject to further information
Page 260
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Understand the following Inputs for the test:
Procurement Management Plan: How procurement processes will be managed
Procurement Documents: Used to request proposals from sellers, audit trail
Source Selection Criteria: Used to rate and scope proposals
Seller Proposals: Evaluated to select the successful seller
Project Documents: Risk Register and contract decisions on risk
Make-or-Buy Decisions: Will the work be done internally or be acquired?
Procurement Statement of Work: Clearly stated goals and requirements
OPA: Company supplier lists
12.2.1 Conduct ProcurementsInputs
Pages 260-261
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Bidder Conferences – Assembling all prospective vendors in a single meeting, with information disseminated and individual bids later receivedProposal Evaluation Techniques –Comparison of alternative proposals on the basis of vendor responses. Weighted Scoring is a commonly used techniqueIndependent Estimates – Use of an outside professional to provide a benchmark estimate of costs in advance of receiving proposalsExpert Judgment – Experts from various disciplines may be used to evaluate and advise on proposals
12.2.2 Conduct ProcurementsTools and Techniques
Weighting System
1) determines the evaluation factors
2) assigns a numerical weight to each factor
3) rates the prospective sellers on each criterion
4) multiplies each rating by its weighting
5) totals the ratings to compute an overall score
Removes personal bias, is more objective, and considers
relative importance of different evaluation factors
• Typical factors include technical,
management, and cost factors
• Avoid overly complicated rating models
Pages 262-263
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Advertising – Advertising in selected newspapers or trade publications. Government may require advertising of certain kinds of contracts.
Analytical Techniques– evaluate readiness of a seller, examine past performance for risks.
Procurement Negotiations – The project manager may not be the lead negotiator in many cases, but will provide technical and project clarification.
12.2.2 Conduct ProcurementsTools and Techniques
Pages 263-264
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12.2.2 Conduct ProcurementsTools and Techniques: Procurement Negotiations
• responsibilities and authorities (Who Will Negotiate?)• pricing, payments, and payment schedules• penalty terms• deliverables -- specifications, quantities, quality, timing• applicable laws, standards, regulations, and other requirements• technical and management approaches• copyright and ownership issues; data rights
Ethical Negotiations: each party is honest with the other, regardless of expectations related to future work.
… undertaken to clarify structure, requirements, and contract terms so that mutual agreement on contract terms can be reached prior to signing.
Page 264
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Selected Sellers:
Sellers who are competitive and have negotiated a draft contract
Agreements:
A legal agreement between Buyer and Seller, mutually binding. It includes many requirements and terms that you should remember, including Incoterms and ADR. Read this section carefully.
12.2.3 Conduct ProcurementsOutputs
Page 265
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12.2.3 Conduct ProcurementsOutputs: Types of Contracts
Page 266
Fixed Price (or Lump Sum) Type Contracts:
Cost Reimbursable Type Contracts:
Time & Materials Type Contracts:
Used on development projects for flexibility. Cost risk is on the buyer, so establish administrative & reporting systems to allow both buyer and seller visibility into costs. (Includes CPFF, CPIF, CPAF)
Used on well specified projects for which costs can be accurately estimated. Cost risk is on the supplier. (includes FFP, FPIF, FP-EPA)
Used on projects where the deliverables are well defined, repetitive units but the quantities are not yet known (e.g., identical pieces of equipment, or labor hours and associated material costs – includes overhead and burden)
ExamTip
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13.3 Manage Stakeholder Engagement
Executing: Stakeholder Management
Outputs
Issue logChange requestsProject management plan
updatesProject documents updatesOrganizational process assets
updates
Tools & Techniques
Communication methodsInterpersonal skillsManagement skills
Inputs
Stakeholder management planCommunications management
planChange logOrganizational process assets
Page 268
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13.3 Manage Stakeholder Engagement
Manage Stakeholder Engagement is the process of communicating and working with stakeholders to meet their needs, address issues as they occur, and foster stakeholder engagement in project activities throughout the project life cycle. Managing stakeholders increases the likelihood of project success by ensuring they clearly understand project goals, objectives, benefits, and risk.
Test items in this process are Inputs/Tools and Techniques/Outputs, and understanding the issues and change logs.
Pages 268
The Project Manager (PM) is responsible for engaging and managing stakeholders.
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Monitoring & Controlling Process Group
Page 273
PMBOK® Fifth Edition, Page 86
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Process Groups
Knowledge AreasInitiating Planning Executing Closing
Monitoring &
Controlling
4. Project IntegrationManagement
4.2 Develop ProjectManagement Plan
4.3 Direct & Manage 4.4 Mon/Ctrl Proj Work4.5 Perform Integrated
Change Control
5. Project ScopeManagement
5.1
Collect Requirements5.2
Define Scope
5.5 Validate Scope
5.6 Control Scope
6. Project TimeManagement
6.1
Define Activities6.2Sequence Activities6.3Est. Activity ResourcesEst. Activity Durations6.5Dev. Schedule
6.7 Control Schedule
7. Project CostManagement
7.2 Estimate Costs
7.3 Determine Budget
7.4 Control Costs
8. Project QualityManagement
8.1 Plan Quality Mgt. 8.2 Perform Quality
Assurance8.3 Control Quality
9. Project HumanResourceManagement
9.1 Plan Human
Resource Mgt.9.2 Acquire Project Team
9.3 Develop Project Team
9.4 Manage Project Team
10. ProjectCommunicationsManagement
10.1 Plan Communications
Management 10.2 Manage Communications
11. Project RiskManagement
11.1 Plan Risk Management
11.2 Identify Risks
11.3 Perform QualitativeRisk Analysis
11.4 Perform QuantitativeRisk Analysis
11.5 Plan Risk Response
11.6 Control Risks
12. Project ProcurementManagement
12.1 Plan Procurement Mgt. 12.2 Conduct Procurements 12.3 Control Procurements 12.4 Close Procurements
Project Work4.1 Develop Project Charter
13.1 Identify Stakeholders
5.4 Create WBS
6.4
4.6 Close Project
or Phase
13.3 Manage Stakeholder
Engagement
13.4 Control Stakeholder
Engagement
Plan Scope Mgt.
5.3
Plan Schedule Mgt.
6.6
7.1 Plan Cost Mgt.
10.3 Control Communications
13. Project Stakeholder
Management13.2 Plan Stakeholder
Management
PMBOK® Fifth Edition, Page 61
Monitoring and Controlling
4.4 Manage and Control Project Work
4.5 Perform Integrated Change Control
5.5 Validate Scope5.6 Control Scope6.7 Control Schedule7.4 Control Costs8.3 Control Quality10.3 Control Communications11.6 Control Risks12.3 Control Procurements13.4 Control Stakeholder
Engagement
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
4.4 Monitor and Control Project Work
M&C: Integration Management
Outputs
Change requestsWork performance reportsProject management plan
updatesProject documents updates
Tools & Techniques
Expert judgmentAnalytical techniquesProject management
information systemMeetings
Inputs
Project management planSchedule forecastsCost forecastsValidated changesWork performance informationEnterprise environmental factorsOrganizational process assets
Page 274
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4.4 Monitor and Control Project Work
Monitor and Control Project Work is the process of tracking, reviewing and reporting the progress to meet the performance objectives defined in the project management plan.
Control includes determining corrective action, preventative action or defect repair and following up on actions taken to resolve performance issues
Page 274
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4.4 Monitor and Control Project Work
Page 273
Taken together, the controlling processes monitor project progress and performanceagainst the plan and provide the appropriate response to deviations from plan. Theseresponses frequently require changes to the project plan; hence, project planning,project execution, and project control form a triad of process groups that arerepeated throughout the project life cycle at each phase gate.
Project monitoring and control is more than earned value
Many project management technicians and some inexperienced project managersequate project control with earned value. While earned value is an essential part ofproject control, it is only a part. Fully integrated project control draws from severalknowledge areas and calls upon all of the leadership, communication, and negotiationskills of the project manager.
Project monitoring and control is more than data collection
Another common, practical problem is confusing data collection with project control.Project control is more than just collecting data about project performance; it alsorequires analyzing the data, evaluating the meaning of the data and any variances,taking appropriate corrective actions, and related record keeping.
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4.4 Monitor and Control Project Work
Page 274
This process is part of Project Integration Management knowledge area,
along with Integrated Change Control. This process involves monitoringall processes: initiating, planning, executing, and closing.
Planning Processes
Executing Processes
Monitoring & Controlling Processes
Initiating Processes
Closing Processes
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Inputs: The Project Management Plan (Another Reminder)
Page 275
4.4.1 Monitor and Control Project Work
Plan Scope Management Collect Requirements Define Scope Create WBS Plan Schedule Management Define Activities Sequence Activities Estimate Activity Resources Estimate Activity Durations Develop Schedule Plan Cost Management Estimate Costs
Determine Budget Plan Quality Management Plan Human Resource Management Plan Communications Management Plan Risk Management Identify Risks Perform Qualitative Risk Analysis Perform Quantitative Risk Analysis Plan Risk Response Plan Procurement Management Plan Stakeholder Management
The other 23 planning processes are integrated to create the projectmanagement plan. Updates to any plans require an update to the PM plan. Thinkof the PM plan as a bucket into which all the other plans “drip” until it is full.
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Other Inputs:
Page 275-276
4.4.1 Monitor and Control Project Work
• Schedule Forecastsusing schedule variance (SV) and schedule performance index (SPI) to compute estimate to complete (ETC)
• Cost Forecasts using cost variance (CV) and cost performance index (CPI) to compute estimate at completion (EAC)
• Validated Changes
• Work Performance Informationcollected data is analyzed and transformed into work performance information
• EEF and OPA
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Work Performance Information
• Status of deliverables
• Implementation of change requests
• Forecasts: variance, trend, and earned value information, estimates at completion (EAC), schedule forecasts, index information
(SPI, CPI, TCPI).
• Generally involves Gantt charts and S-curves.
• Includes cost, schedule, quality and scope accomplishment and variance information
Page 276
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Tools and Techniques:
Page 277
4.4.1 Monitor and Control Project Work
• Expert Judgment
• Analytical Techniquesregression analysis, grouping methodscausal analysis root cause, FMEA, trends, etc.
• Validated Changes
• PMIS and Meetings
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
4.5 Perform Integrated Change Control
M&C: Integration Management
Outputs
Approved change requestsChange log Project management plan
updatesProject documents updates
Tools & Techniques
Expert judgmentMeetingsChange control tools
Inputs
Project management planWork performance reportsChange requestsEnterprise environmental factorsOrganizational process assets
Page 279
PMBOK® Fifth Edition, Page 94
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4.5 Perform Integrated Change Control
Perform Integrated Change Controlis the process of reviewing all change requests, approving changes and managing changes to deliverables, organizational process assets, project documents and the project management plan; and communicating their disposition.
Sometimes a Change Control Board (CCB) is responsible for approving or rejecting changes, as approved by the customer or sponsor.
Page 279-280
Configuration Control focuses on the specification of deliverables and processes.Change Control focuses on changes to project documents, deliverables or baselines.
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4.5 Perform Integrated Change Control
Page 280
Change Control System
A set of procedures that describes how modifications to the project deliverables and documentation are managed and controlled, including:
• requesting changes• reviewing the implications of changes requests• approving or rejecting changes• communicating changes• maintaining a change log - comprehensive list of changes
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4.5.2 Perform Integrated Change Control
Page 281
Tools and Techniques: Configuration Management
A set of processes and procedures to ensure that the documentation of the product and the actual product remain consistent with each other:
Glossary Definition:
The configuration management system is a collection of procedures used to identify and document the functional and physical characteristics of a product or component. It:
• controls changes to these characteristics, • records/reports each change, • audits the products to verify conformance to requirements. • documentation, tracking, and approval levels • validates the impact, and • communicates them to stakeholders.
ExamTip
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4.5.1 Perform Integrated Change Control
Page 281
Inputs: Work Performance Reports
Reports of interest include: • resource availability, • schedule/cost data, • earned value management (EVM) reports, and • Burnup or burndown charts.
A burndown chart tracks how much work remains on your project and whether or not you will hit the deadline.
A burnup chart tracks how much work is done.
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4.5.1 Perform Integrated Change Control
Page 282
Inputs: Change Requests are NOT Change Orders
Change Requests: oral or written, formal or informal, may or may not be implemented
Change Orders: formal request for change to approved project plan; typically used for projects performed under contract
Beware of the “Constructive Change Order” -- an oral or writtencommunication from a perceived authority that the project team may(possibly legally) respond to as equivalent to a written change order.
“A Functional Manager wants to make a change in the project. What is the firstthing a PM should do?”
“A Senior Manager decides the scope of work should be changed. What is bestto do?”
Answer: Evaluate the impact on the project. Meet with the team to discussalternatives, before deciding to use reserves and meet with management.
The Exam lists incorrect choices, like: “meet with the customer first” or “meetwith management first” The correct answer is evaluate first
ExamTip
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4.5.2 Perform Integrated Change Control
Page 283
Tools and Techniques: Change Control Meeting
Approved or Rejected Change Requests
A formally chartered group responsible for reviewing, evaluating, approving, delaying, or rejecting changes to the project, and for recording and communicating such decisions.
• Reviews and approves or rejects change requests• May also be responsible for defining the change request process,
communicating change decisions, and managing the implementation of approved changes.
• Power and responsibilities should be reviewed and agreed to by stakeholders
In some projects, changes are controlled by a Change Control Board (CCB),And implemented by the Project Team
A Change Control Board (CCB) is:
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
5.5 Validate Scope
M&C: Scope Management
Outputs
Accepted deliverablesChange requestsWork performance
informationProject documents updates
Tools & Techniques
InspectionGroup decision-making
techniques
Inputs
Project management planRequirements documentationRequirements traceability matrixVerified deliverablesWork performance data
Page 285
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5.5 Validate Scope
Validate Scopeis the process of formalizing acceptance of the completed project deliverables.
Scope validation is different from quality control in that validate scope is primarily concerned with the acceptance of the deliverables
PMBOK® Fourth Edition, Page 123
Page 285
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5.5.3 Validate Scope
Page 287
Outputs: Accepted Deliverables
These have all been answers on the test:
Customer feedback on a more detailed basis
Done at the end of each Project Phase
Results in formal acceptance
ExamTip
The questions on the exam are vague on Scope Validation.Read them carefully.
One question asks for: “the key aspect of scope validation”
Answer: “customer acceptance of project efforts”.The answer does not involve correctness of the work.
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
5.6 Control Scope
M&C: Scope Management
Outputs
Work performance information
Change requestsProject management plan
updatesProject documents updatesOrganizational process assets
updates
Tools & Techniques
Variance analysis
Inputs
Project management planRequirements documentationRequirements traceability matrixWork performance dataOrganizational process assets
Page 288
PMBOK® Fifth Edition, Page 136
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5.6 Control Scope
Control Scope is the process of monitoring the status of the project and product scope and managing changes to the scope baseline
Uncontrolled changes are often referred to as Scope Creep.
Page 288
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5.6.1 Control Scope
Page 288
Inputs
The primary inputs to Control Scope are: Project management plan Requirements documentation Requirements traceability matrix Work performance data Organizational process assets
The project management plan includes the following to control scope:
The scope baseline Scope management plan Change management plan Configuration management plan Requirements management plan
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
5.5.2 Control Scope
Pages 290
Tools and Techniques: Variance Analysis
… a comparison of actual results to planned results for the purpose of early problem detection ...
• Cost, schedule, scope, and quality variances are most typical – but they can also include resources and risk variances.
• Both positive and negative variances need analysis
• Should involve an evaluation of cause and impact
• Becomes an input to change control process for generating corrective actions
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
5.5.2 Control Scope
Pages 291
Outputs: Work Performance Information
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
6.7 Control Schedule
M&C: Time Management
Outputs
Work performance information
Schedule forecastsChange requestsProject management plan
updatesProject documents updatesOrganizational process
assets updates
Tools & Techniques
Performance reviewsProject management
softwareResource optimization
techniquesModeling techniquesLeads and lagsSchedule compressionScheduling tool
Inputs
Project management planProject scheduleWork performance dataProject calendarsSchedule dataOrganizational process assets
Page 292
PMBOK® Fifth Edition, Page 185
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6.7 Control Schedule
Control Schedule is the process of monitoring the status of project activities to update project progress and manage changes to the schedule baseline to achieve the plan
Page 292
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6.7.1 Control Schedule
Page 292
Inputs
The inputs to Control Schedule are: Project management plan Project schedule Work performance data Project calendars Schedule data OPA
To control schedule, the project management plan includes:
The schedule management plan The schedule baseline
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
6.7.2 Control ScheduleTools and Techniques: Performance Reviews
PV = Planned Value (was BCWS) (1)
EV = Earned Value (was BCWP) (2)
AC = Actual Cost (was ACWP) (3)
(1) requires a performance baseline(2) requires a way to measure value of
work completed (earned value)(3) requires a way to collect actual
costs at work package level
t Actual
t When Planned
Time
Cost, Hours, or Work Products
EVWork Performed(Earned Value)
PVPlanned Value
ACActual Cost
SVScheduleVariance
CVCost
Variance
Pages 294-295
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6.7.2 Control Schedule
Pages 294-295
Tools and Techniques: Variance Analysis
… a comparison of actual results to planned results for the purpose of early problem detection ...
• Cost, schedule, scope, and quality variances are most typical – but they can also include resources and risk variances.
• Both positive and negative variances need analysis
• Should involve an evaluation of cause and impact
• Becomes an input to change control process for generating corrective actions
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6.7.2 Control Schedule
Page 294
Tools and Techniques: Corrective Action
* Taking action to expedite schedules, such as assigning more or different resources or overlapping tasks
* Delaying a purchase to protect cash flow
* Invoking planned risk responses when risk events occur
Changes to align future project performance with the project plan. Corrective actions should be based on what-if evaluations and may be the result of formal replanning. Corrective actions complete the loop between project control and project execution:
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6.7.2 Control Schedule
Page 295
Tools and Techniques: Trend Analysis
• a tool that uses mathematical techniques to forecast future outcomes based on past results
• may be used to monitor quality (product), cost and scheduleperformance of a project
• provides a high-level overview that indicates whether or not more detailed information is needed The Rule of Seven: 7 data
points all above or below the mean, or all increasing or decreasing, indicate a trend
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6.7.2 Control Schedule
Page 206
Tools and Techniques: Project Management Software
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6.7.2 Control Schedule
Page 296
Tools and Techniques: Resource Optimization Techniques
Month 1 Month 2 Month 3 Month 4
Product Manager
Resource plans are best when resource requirementsincrease and decrease without variations
0.5
1.0
1.5
The resource histogram is a time-phased display of the amount of project work assigned to each resource (PMBOK Fifth Edition, Page 189-190)
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6.7.2 Control Schedule
Page 297
Tools and Techniques: Modeling Techniques
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6.7.2 Control Schedule
Page 298
Tools and Techniques: Schedule Compression
Activity
ABC
NormalTime
4 wks3 wks2 wks
NormalCost
12,0006,0004,000
CrashTime
2 wks2 wks1 wks
CrashCost
15,0007,0005,500
Crash(wks)
2 wks1wks1 wks
TotalCrash Cost
3,0001,0001,500
Crash Costper week
1,5001,0001,500
Fast TrackingParalleling - Activities or phases normally be done in sequence are performed in
parallel for at least a portion of their duration. fast tracking can result in rework and increased risk.
CrashingA technique to shorten the schedule duration for the least incremental cost by adding
resources. Works only for activities on the critical path. May result in increased risk and/or cost.
ExamTip
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7.4 Control Costs
M&C: Cost Management
Outputs
Work performance information
Cost forecastsChange requestsProject management plan
updatesProject documents updatesOrganizational process
assets updates
Tools & Techniques
Earned Value ManagementForecastingTo-complete performance
index (TCPI)Performance reviewsProject management softwareReserve analysis
Inputs
Project management planProject funding requirementsWork performance dataOrganizational process assets
Page 300
PMBOK® Fifth Edition, Page 215
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7.4 Control Costs
Control Costs is the process of monitoring the status of the project to update the project costs and managing changes to the cost baseline
Page 300
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7.4.1 Control Costs
Page 301
Inputs: Project Management Plan (Cost Management Plan & Cost Baseline)
Time
Cost Cost Performance Baseline
Cumulative Planned Value (PV)
Monthly Planned Value (PV)
Spending Plans and Cash Flow
Plans are special types of Cost
Baselines
ExamTip
A time-phased budget (either by performance period or summed cumulatively over the life of the project) used to monitor and control project costs.
BAC
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7.4.1 Control Costs
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Inputs: Project Funding Requirements and Management Reserve
ExamTip
Time
Cost
Cost Baseline
Cumulative Planned Value (PV)
Cash Flow
Funding
}Management
Reserve
Project Budget
BAC
Expenditures
EAC (forecasted cost)
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7.4.1 Control Costs
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Inputs: Work Performance Data
• Organizes and summarizes information on project status and progress
• It includes data on activities that have started , their progress, and which deliverables have been finished
Caution: Ensure a consistent “data date”, ideally from a common set of data
• Includes cost, schedule, scope accomplishment and variance information
• Includes data on costs authorized and costs incurred
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7.4.2 Control Costs
Page 303 & 305
Tools and Techniques: Earned Value Management (EVM)
Earned value management (EVM), also known as earnedvalue technique (EVT) compares Earned Value (EV or BCWP)to both Planned Value (PV or BCWS) and Actual Cost (AC orACWP) to analyze cost control, resource management, andproduction. Cost control determines the cause of a variance,its magnitude, and if corrective action is needed.
CV at the end of a project is BAC minus total actual cost. SVat the end of a project is zero, because all of the plannedvalues will have been earned.
CPI and SPI are efficiency indicators.
ExamTip
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7.4.2 Control Costs
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Tools and Techniques: Earned Value Management (EVM)
Definition of Terms
Value of work planned to be done at any point in time.
How much did we spend to get the work done at a point in time?
Planned value of the work we completed at any point in time.
How much did we budget for the whole project?
Given our progress, what is our forecast of the total project cost?
How much more do we estimate the job will cost?
How much over/under budget will we be?
PV
AC
EV
BAC
EAC
ETC
VAC
Planned Value
Actual Cost
Earned Value
Budget at Completion
Estimate at Completion
Estimate to Complete
Variance at Completion
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013Page 304
Tools and Techniques: Earned Value Management (EVM) - Equations
CV Cost Variance CV = EV – AC Negative = Over budget, Positive = Under budget
SV Schedule Variance SV = EV – PV Negative = Behind schedule, Positive = Ahead of schedule
CPI Cost Performance Index Less than 1.0 = Over budgetGreater than 1.0 = Under budget
SPI Schedule Performance Index
Less than 1.0 = Behind scheduleGreater than 1.0 = Ahead of schedule
EAC Estimate at Completion(4 formulas)
Definition:At this time in the project, what is the forecast of total project cost?
Used when EV trend is typical (CPI will be the same for the rest of the project)
Used when EV trend is atypical (CPI will change to follow the planned rate, or PV line)
Actual cost plus bottom-up estimate to complete by the team. (plan is no longer valid, re-estimate the plan)
Used when both CPI and SPI influence the remaining work. Assumes negative cost performance and need for firm schedule.
EAC = AC + (BAC-EV)
BACCPI
EVAC
CPI =
EVPV
SPI =
(BAC-EV)
(CPI x SPI)
EAC =
EAC = AC + ETC
EAC = AC +
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013Page 305
Tools and Techniques: Earned Value Management (EVM) - Equations
ETC Estimate to Complete ETC = EAC - AC
ETC= Re-estimate
The expected cost to finish all the remaining work. If work is proceeding on plan, use this this to calculate the work remaining
Bottom up re-estimate by the team
TCPI
Basedon
BAC
Based on
EAC
VAC
Cost efficiency that must be maintained to complete the project on plan (BAC).
Cost efficiency that must be maintained to complete the current EAC.
Variance at Completion
Less than 1.0 = Easier to completeGreater than 1.0 = Harder to complete(Value of work remaining divided by the value of the budget remaining)
Less than 1.0 = Easier to completeGreater than 1.0 = Harder to complete(Value of work remaining divided by calculated estimate to complete, ETC)
At the end, how much more or less than plan will we have spent?
BAC-EVBAC-AC
TCPI =
BAC-EVEAC-AC
TCPI =
VAC = BAC-EAC
7.4.2 Control Costs
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7.4.2 Control Costs
Page 307
Tools and Techniques: Earned Value Management (EVM)
EACWork Products
Money Hours Deliverables.
0
$2,000 200 20
$1,000 100 10
1 2Weeks
3
$3,000 300 30
AC
Schedule Variance (SV)
Cost Variance
(CV)
EV
Projected Overrun
PV(Baseline)
BAC
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7.4.2 Control Costs
Page 307
Tools and Techniques: EVM, The Easy Way to Remember It
• EV (BCWP) comes first in every formula.
• If it is a variance - it is EV minus something
• If it is an index - it is EV divided by something
• If the question relates to cost - use AC
• If the question refers to schedule - use PV
• Negative is either behind schedule or over budget ( For example: CV = -30% = over budget)
• Positive is either ahead of schedule or under budget
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Task A100 Hrs
Task B200 Hrs
Task C200 Hrs
WBS
A
C
Time, weeks 1 2 3 4
500
Cum. Hrs.
400
300
200
100
BCWS
B
Project Status at the end of Week 2
Task A 100% complete AC = 140 hours
Task B 25% complete AC = 80 hours
Task C 0% complete AC = 0 hours
Try It:
Schedule Variance ____________
Cost Variance ____________
Cost at Completion ____________(Typical)
Cost at Completion ___________(Atypical)
-50 hours
50 50
100 100
100 100
EVc = 150 hours
PVc = 200 hours
SV = - 50 hours
EVc = 150 hours
ACc = 220 hours
CV = - 70 hours
-70 hours
733 hours
Cost at Completion = 220 + [(500-150)/(150/220)]
(Typical) = 733 hours
Cost at Completion = 220 + (500 -150)
(Atypical) = 570 hours
570 hours
Exercise
PV
= BAC/CPI
Page 308
Dimensions of Project Performance
PV = Planned Value
AC = Actual Cost
EV = Earned Value
Schedule Variance = EV - PV
Cost Variance = EV - AC
CPIc = EVc/ACc
Estimated (Cost) (BAC-EVc)] at Completion =
(EAC): Typical
Estimated (Cost)at Completion = ACc + (BAC-EVc)
(EAC): Atypical
CPIcACc +
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7.4.2 Control Costs
Page 309
Tools and Techniques: Forecasting
• EAC Based on ETC by the Team
EAC = AC + Bottom-Up ETC
• EAC Forecast where Future Work is at Same Rate of Work Shown in the Baseline Budget
Past costs were atypical, and future work will be at the same rate of expenditure as in the baseline budget.
EAC = AC + (BAC - EV)
• EAC Forecast where Future Work will not Change from Actual
Past costs were typical of what will happen in the future.
EAC = BAC/CPI
• EAC Forecast where Future Work be Modified by both CPI and SPI
Future work will be at the same rate of expenditure as in the original baseline budget, but is modified byboth of the indexes. It assumes the project is in a cost overrun situation and there is a requirement to meeta firm schedule commitment. It is useful when schedule is a factor affecting future work. The weighting ofCPI and SPI can be varied according to the PM’s judgment (80/20, 50/50, etc.)
EAC = AC + [(BAC – EV)/(CPI x SPI)]
Same as:EAC = AC + [(BAC – EV)]/CPI]
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Tools and Techniques: To-Complete Performance Index (TCPI)
TCPI is used to determine if the BAC or the EAC can be reasonably achieved
It measures future cost performance needed achieve either a target BAC ortarget EAC. Calculate the reasonableness of BAC first. If it is obvious that theBAC is no longer viable, the project manager should consider thereasonableness of achieving the forecasted EAC.
TCPI (BAC) =Work Remaining
Funds Remaining
TCPI (BAC) =BAC - EV
BAC - AC
To Achieve a Target BAC
TCPI (EAC) =BAC - EV
EAC - AC
To Achieve a Target EAC
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7.4.2 Control Costs
Page 310
Tools and Techniques: To-Complete Performance Index (TCPI)
The TCPI is compared to the cumulative CPI to determine if a target EAC is reasonable, e.g., within plus/minus 0.05 of the cumulative CPI (some management groups allow plus/minus 0.10). If a TCPI delta exceeds 0.05, the target EAC may be overly optimistic. If a TCPI delta is lower than 0.05, the target EAC may be overly conservative.
Given a TCPI of 1.1, the simple definition is: for every dollar spent from here to the end of the contract, a dollar and ten cents worth of budgeted work must be completed (or earned) to achieve the target EAC. Likewise a TCPI of 0.95 means: for every dollar spent from here to the end of the contract, only 95 cents worth of budgeted work must be completed or earned.
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
7.4.2 Control Costs
Pages 310
Tools and Techniques: To-Complete Performance Index (TCPI)
To-Complete Performance Index
1.00
+
-
Baseline Plan
TCPI (BAC)
TCPI (EAC)
Status Date
Cumulative CPI
To-Complete Performance Index
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
8.3 Control Quality
M&C: Quality Management
Outputs
Quality control measurements
Validated changesVerified deliverablesWork performance informationChange requestsProject management plan
updatesProject documents updatesOrganizational process
assets updates
Tools & Techniques
Seven basic quality toolsStatistical samplingInspectionApproved change requests
review
Inputs
Project management planQuality metricsQuality checklistsWork performance dataApproved change requestsDeliverablesProject documentsOrganizational process
assets
Page 315
PMBOK® Fifth Edition, Page 248
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
8.3 Control Quality
Perform Quality Control is the process of monitoring and recording results of executing the quality activities to assess performance and recommend necessary changes
Page 315
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8.3.1 Control Quality
Pages 316
Quality Control (QC): a process of monitoring and recording results (both product
and project management) of executing quality activities to assess performance andto recommend necessary changes. Involves identifying ways to remove the causes ofquality defects.
Quality control involves inspection and requires an understanding of samplingstrategies, tolerances, and the causes of variation in a process. It is done in theMonitoring and Controlling Process.
Inputs: Are straight forward, read them, but remember:
Quality Assurance (QA): the process of auditing quality requirements, and the
results from quality control (QC) measurements, to ensure quality standards andoperational definitions are used..
Quality assurance involves Quality Audits, and is done in Execution Process.
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8.3.2 Control Quality
Page 319
Tools and Techniques
Cause and Effect Diagram
Control Charts
Flowcharting
Histograms
Pareto Diagrams
Checksheets
Scatter Diagram
The first seven (7) Tools & Techniques in this section are called the Seven Basic Tools of Quality - know these for the test!
ExamTip
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8.3.2 Control Quality
Page 319
Tools and Techniques: Cause and Effect Diagram
Cause & Effect, Ishikawa or Fishbone Diagrams
EFFECTCAUSES
People
Lack of Training
MethodsMaterial
Transport IT System Procedure
Not Following Procedures
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8.3.2 Control Quality
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Tools and Techniques: Control Charts
A chart of process performance over time used todetermine if the process is in control or out of control
in control normal distribution of outcomes due to common causes of variation
inherent in the process
out of control rule of seven, trends, and cycles due to special causes of variation
external to the process
±1
6
8%
±2
9
5.5
%
±3
9
9.7
%...
...
.....
..................
UCL
LCL
......
Mean
.Normal
Distribution Curve
Expected Variation
Out of Control(Assignable Cause)
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8.3.2 Control Quality
Page 321
Tools and Techniques: Control Charts
Plan or Mean
UCL
LCL
Lower Spec. Limit
Upper Spec. Limit
Actual
Hours recorded for this project started on plan, but if the trend continues, hours spent will drift out of control.
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8.3.2 Control Quality
Page 321
Tools and Techniques: Flowcharting
Process Flowchart
Design Review
Revise
OK?
Yes
Proceed
No
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8.3.2 Control Quality
Pages 321-322
Tools and Techniques: Pareto Charts
source
% c
on
trib
uti
on
(o
r fr
equ
en
cy o
f o
ccu
rren
ce) Pareto Diagram: a histogram, ordered by
frequency of occurrence, that shows the percentcontribution of each category of identified cause tothe overall quality defects in a product or process.
Pareto’s Law:
80/20 Rule
80%?
Design of Experiments:
Which variables have influence over the outcome.
“What If” Analysis
Pareto Analysis: Pareto diagrams help
project teams identify the vital few factors thataccount for most quality problems from the morenumerous trivial many factors.
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8.3.2 Control Quality
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Tools and Techniques: Run Chart
… a tool that uses mathematical techniques to forecast future outcomes based on past results
… may be used to monitor quality (product), cost and schedule performance of a project
… provides a high-level overview that indicates whether or not more detailed information is needed The Rule of Seven: 7 data
points all above or below the mean, or all increasing or decreasing, indicate a trend
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8.3.2 Control Quality
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Tools and Techniques: Scatter Diagram
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8.3.2 Control Quality
Page 324
Tools and Techniques: Statistical Sampling
…a technique for accepting or rejecting a larger population by choosing a part of the population for inspection ...
• Statistical sampling can reduce the cost of QC on a project.
• The validity of statistical sampling depends on anappropriate choice of sample items and sample size.
• Sample size increases exponentially as the level of desired certaintyincreases and the acceptable level of error decreases.
• Sampling strategies include single samples from a lot, multiple smallsamples from a lot, and double sampling methods where the size of thesecond sample depends on the results of the first sample.
• All sampling strategies involve some risk of producer error (type I error)where acceptable lots are rejected based on a non-representative sampleor consumer error (type II error) where unacceptable lots are acceptedbased on a non-representative sample.
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8.3.2 Control Quality
Page 325
Tools and Techniques: Inspection Techniques
… An evaluation of whether or not the project results conform to the latest specifications and requirements ...
Types of Inspection :
• measuring• examining• auditing• testing• acceptance testing• reviewing• walk-throughs
Inspection generally takes place throughout the project’s lifecycle. Be sure to plan for it accordingly and to include it in the WBS.
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
10.3 Control Communications
M&C: Communications Management
Outputs
Work Performance information
Change requestsProject management plan
updatesProject documents updatesOrganizational process
assets updates
Tools & Techniques
Information management systems
Expert judgmentMeetings
Inputs
Project management planProject communicationsIssue logWork performance dataOrganizational process assets
Page 328
PMBOK® Fifth Edition, Page 303
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
10.3 Control Communications
Control Communications is the process of monitoring and controlling communications throughout the entire project life cycle to insure the information needs of the project stakeholders are met.
Page 328
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013Page 329
Inputs: Work Performance Data
• How much work is done so far?
• How much work did we plan to have done so far?
• When do we now estimate the project will be done?
• How much have we spent for what we’ve achieved?
• How much did we plan to spend for what we’ve achieved?
• How much do we now estimate the project will cost to complete?
?Earned Value Management: Test Yourself
10.3.1 Control Communications
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013Page 332
Outputs: Work Performance Information
10.3.3 Control Communications
Variance Analysis
… a comparison of actual results to planned results for the purpose of early
problem detection ...
• Cost, schedule, scope, and quality variances
are most typical – but they can also include
resources and risk variances.
• Both positive and negative variances need
analysis
• Should involve an evaluation of cause and
impact
• Becomes an input to change control process
for generating corrective actions
Earned Value Management: The Data
PV = Planned Value (was BCWS) (1)
EV = Earned Value (was BCWP) (2)
AC = Actual Cost (was ACWP) (3)
(1) requires a performance baseline
(2) requires a way to measure value of
work completed (earned value)
(3) requires a way to collect actual
costs at work package level
t Actual
t When Planned
Time
Cost,
Hours,
or Work
Products
EV
Work Performed
(Earned Value)
PV
Planned Value
AC
Actual Cost
SVScheduleVariance
CVCost
Variance
TotalVariance
• a tool that uses mathematical
techniques to forecast future outcomes
based on past results
• may be used to monitor quality
(product), cost and schedule
performance of a project
• provides a high-level overview that
indicates whether or not more detailed
information is neededThe Rule of Seven: 7 data
points all above or below the
mean, or all increasing or
decreasing, indicate a trend
Trend Analysis
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
11.6 Control Risks
M&C: Risk Management
Outputs
Work performance information
Change requestsProject management plan
updatesProject documents updatesOrganizational process
assets updates
Tools & Techniques
Risk reassessmentRisk auditsVariance and trend analysisTechnical performance
measurementReserve analysisMeetings
Inputs
Project management planRisk registerWork performance dataWork performance reports
Page 335
PMBOK® Fifth Edition, Page 349
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
11.6 Control Risks
Control Risks is the process of implementing risk response plans, tracking identified risks, monitoring residual risks, identifying new risks and evaluating risk process effectiveness throughout the project
Page 335
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
11.6.1 Control Risks
Page 335-236
Inputs
Work Performance Reports
Guidelines for Performance Reports:
• keep the report short, matching its length to the projects’ complexity and the audience’s needs
• use a consistent template and format
• use visual elements such as charts and graphs
Criteria for Performance Reporting:
• gives timely, complete, and accurate information
• doesn’t add more administrative overhead than it’s worth
• is acceptable and useful to all participants
• gives warning of problems in time for preventive or corrective actions
• is easily understood by those who have a need to know
Purpose of Performance Reports:
• to detect problems in time to take corrective or preventive action
• to reduce customer and management anxiety
• to share project information within the project team
The Risk Management Plan Includes:
• Methodology: Approaches, tools and data sources.
• Roles and Responsibilities: Team member ownership for risk activities.
• Budgeting: Funds needed for contingency reserves and management reserves.
• Timing: When processes will be done, reserves applied, and how risk appears in schedule.
• Categories: Risk groupings. The RBS looks at sources of risk, IDs and categorizes them.
• Thresholds: What is the trigger? Stakeholders have different thresholds of risk tolerance,
define them, and the must be agreed by all.
• Define P/I Levels: Qualitative (low to high) or probabilities.
• Risk Matrix: Likelihood-Severity, or Probability-Impact.
• Stakeholder Risk Tolerances: Progressively elaborated.
• Reporting Formats and Tracking: Document risk, auditing, defines content of risk register.
Risk Register
• Sources of risk, potential risk event, and risk symptoms
• Opportunities to pursue, opportunities to ignore
• Threats to respond to, threats to accept
• Planned risk responses and how contingencies will be implemented
• Risk reserves
• Responsibilities for risk management
• Plan for ongoing risk identification,
quantification, and response development
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11.6.2 Control Risks
Page 338
Tools and Techniques: Variance and Trend Analysis
Variance Analysis
… a comparison of actual results to planned results for the purpose of early
problem detection ...
• Cost, schedule, scope, and quality variances
are most typical – but they can also include
resources and risk variances.
• Both positive and negative variances need
analysis
• Should involve an evaluation of cause and
impact
• Becomes an input to change control process
for generating corrective actions
• a tool that uses mathematical
techniques to forecast future outcomes
based on past results
• may be used to monitor quality
(product), cost and schedule
performance of a project
• provides a high-level overview that
indicates whether or not more detailed
information is neededThe Rule of Seven: 7 data
points all above or below the
mean, or all increasing or
decreasing, indicate a trend
Trend Analysis
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11.6.2 Control Risks
Pages 339
Tools and Techniques: Reserve Analysis
A provision in the project plan to mitigate cost and/or schedule risk
May be calculated as a percent of baseline to allow for overrunsMay be established as a separate fund for unforeseen problemsMay have many different (and application area specific) names:
• management reserve• contingency
May be assigned to any level of the WBS, or RBS cause.
ExamTip
PMI recommends aminimum totalreserve of 10%
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11.6.3 Control Risks
Pages 339
Outputs: Updates and Change Requests
Implementing contingency plans or workaroundsrequires change to the project plan. Workaround is defined as a response to a threat that has occurred, for which a prior response had not been planned or was not effective. Change requests can include corrective and preventive actions.
Change Control System
A set of procedures that describes how modifications to
the project deliverables and documentation are managed
and controlled, including:
• requesting changes
• reviewing the implications of changes requests
• approving or rejecting changes
• communicating changes
• maintaining a change log - comprehensive list of changes
Contingency = Pre-Planned
Was on my test
ExamTip
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Exercise
Risk Monitoring and Control
ExamTip
The exam often asks questions such as:
•What do you do with non-critical risks?
•Would you select only one risk response strategy?
•What risk activities would you do during Execution?.
•What is most important to address in team meetings?
•How would risk be addressed in team meetings?
•Which are more frequent, contingency plans
or workarounds?
Answer: Document and revisit frequently
Answer: No, a combination of choices
Answer: Watch for non-critical risks thatbecome more important
Answer: Risk
Answer: “Status of risks?”, “Any newrisks?”, “Any change to theorder of importance?”
Answer: With proper risk managementWorkarounds become lessfrequent than contingency plans.
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
12.3 Control Procurements
M&C: Procurement Management
Outputs
Work performance information
Change requestsProject management plan
updatesProject documents updatesOrganizational process
assets updates
Tools & Techniques
Contract change control system
Procurement performance reviews
Inspections and auditsPerformance reportingPayment systemsClaims administrationRecords management
system
Inputs
Project management planProcurement documentsAgreementsApproved change requestsWork performance reportsWork performance data
Page 341
PMBOK® Fifth Edition, Page 379
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
12.3 Control Procurements
Control Procurements is the process of managing procurement relationships, monitoring contract performance and making changes and corrections to contracts as appropriate
Page 341
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013Pages 342-343
Inputs
Match Contract Type to the Project
Fixed Price (or Lump Sum) Type Contracts:
Cost Reimbursable Type Contracts:
Time & Materials Type Contracts:
Used on development projects for flexibility. Cost risk is on the buyer,
so establish administrative & reporting systems to allow both buyer and
seller visibility into costs. (Includes CPFF, CPIF, CPAF)
Used on well specified projects for which costs can be accurately
estimated. Cost risk is on the supplier. (includes FFP, FPIF, FP-EPA)
Used on projects where the deliverables are well defined, repetitive units
but the quantities are not yet known (e.g., identical pieces of equipment, or
labor hours and associated material costs – includes overhead and burden)
ExamTip
12.3.1 Control Procurements
Procurement Statement of Work
A narrative description of products or services to be supplied under contract.
• Provides the basis of agreement between buyer and supplier
• Sufficient detail to allow prospective suppliers to determine
whether or not they can comply
• Sufficient latitude for creative solutions only if appropriate
• Each procurement requires a separate SOW. But one SOW
may cover many items in a single procurement
• May be revised as the procurement progresses
• Should be clear, concise, and unambiguous
• May be developed by the project team
or supporting offices (or even the seller)
depending on policy and ability
• Your best defense against procurement scope creep!
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013Page 343
Inputs: Approved Change Requests
Change Requests/ Change Orders / Constructive Change Orders --know the differences
Use the Change Control System and Change Control Board
Approved / Unapproved -- document all “changes”
Re-plan and update the documentation (including risk)
Contractors may use change orders to “get well”
12.3.1 Control Procurements
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013Page 345
Tools and Techniques: Contract Change Control System
12.3.2 Control Procurements
Contract Change Control System
Defines the process by which the contract can be modified. It ispart of the Integrated Change Control system, and includespaperwork, tracking systems, dispute resolution conditions, andapproval levels for authorization.
If the buyer terminates the contract for cause, convenience, ordefault, it is done in accordance with the termination and changecontrol sections of the contract.
Contract changes usually also involve changes in either contractpricing or schedule or both. Disputed changes may requiremediation or legal resolution.
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013Page 348
Tools and Techniques: Contract Change Control System
Contract Change Control System (PMBOK® Fourth Edition, Page 338): “A Process formodifying the contract”
• Note: When working under a contract, the PM’s success depends not solely on
success of team members, but on the culture and procedures of the buyer’s company.
• Exam questions - “How is project control different in a contracted environment?” Answers may include:
• You need to deal with a different company’s set of procedures
• It is not as easy to “see” the problems
• A greater reliance on reports to determine if a problem exists
• A greater reliance on relationships between Buyer and Seller’s PMs.
Example
12.3.3 Control Procurements
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013Page 345
Tools and Techniques: Claims Administration
12.3.2 Control Procurements
Claims Administration
Contested changes and constructive changes are those where thebuyer and seller cannot agree on payment for the change, orcannot agree that the change even occurred. These become claims,disputes, or appeals.
If not settled by the parties, it may be subject to dispute resolutionprocedures in the contract, e.g., arbitration dispute resolution(ADR), and can be started either before or after contract closure.The preferred method of settlement is negotiation.
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
EXERCISECONTRACT INTERPRETATION – “WHICH WINS”
In each line, circle the item that would “win” in a dispute over contract interpretation !
It depends on the Order of Precedence Clause in the contract !
Contract Language OR A memo describing changes after the contract is signed
Contract Language OR A memo signed by both parties before the contract is signed that
describes what was agreed to during negotiations
Contract terms and conditions OR Scope of work
Common definition OR The intended meaning (without supplying a definition)
Industry use of the term OR Common use of term
Special provisions OR General provisions
Typed over wording on contract OR A handwritten comment on the contract that is also initialed
Numbers OR Words
Detailed terms OR General terms
12.3 Control Procurements
Page 350
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
13.4 Control Stakeholder Engagement
M&C: Project Stakeholder Management
Outputs
Work performance information
Change requestsProject management plan
updatesProject documents updatesOrganizational process
assets updates
Tools & Techniques
Information management systems
Expert judgmentMeetings
Inputs
Project management planIssue logWork performance dataProject documents
Page 351
PMBOK® Fifth Edition, Page 409
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
13.4 Control Stakeholder Engagement
Control Stakeholder Engagement is the process of monitoring overall project stakeholder relationships and adjusting strategies and plans for engaging stakeholders. This process will increase the efficiency and effectiveness of engaging stakeholders as the project evolves. The Project Manager (PM) is responsible for engaging and managing stakeholders.
Page 351
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013Page 352
Tools and Techniques: Information Management Systems
13.4.2 Control Stakeholder Engagement
Information Management Systems
A variety of tools are available to the PM for capturing and distributing information on cost schedule and performance. Reports can be consolidated from several systems for distribution.
Examples are table reporting, spreadsheet analysis, and presentations. Dashboard graphics can be used for visual presentation of project performance
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Closing Process Group
Page 355
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013Page 28
Process Groups
Knowledge AreasInitiating Planning Executing Closing
Monitoring &
Controlling
4. Project IntegrationManagement
4.2 Develop ProjectManagement Plan
4.3 Direct & Manage 4.4 Mon/Ctrl Proj Work4.5 Perform Integrated
Change Control
5. Project ScopeManagement
5.1
Collect Requirements5.2
Define Scope
5.5 Validate Scope
5.6 Control Scope
6. Project TimeManagement
6.1
Define Activities6.2Sequence Activities6.3Est. Activity ResourcesEst. Activity Durations6.5Dev. Schedule
6.7 Control Schedule
7. Project CostManagement
7.2 Estimate Costs
7.3 Determine Budget
7.4 Control Costs
8. Project QualityManagement
8.1 Plan Quality Mgt. 8.2 Perform Quality
Assurance8.3 Control Quality
9. Project HumanResourceManagement
9.1 Plan Human
Resource Mgt.9.2 Acquire Project Team
9.3 Develop Project Team
9.4 Manage Project Team
10. ProjectCommunicationsManagement
10.1 Plan Communications
Management 10.2 Manage Communications
11. Project RiskManagement
11.1 Plan Risk Management
11.2 Identify Risks
11.3 Perform QualitativeRisk Analysis
11.4 Perform QuantitativeRisk Analysis
11.5 Plan Risk Response
11.6 Control Risks
12. Project ProcurementManagement
12.1 Plan Procurement Mgt. 12.2 Conduct Procurements 12.3 Control Procurements 12.4 Close Procurements
Project Work 4.1 Develop Project Charter
13.1 Identify Stakeholders
5.4 Create WBS
6.4
4.6 Close Project
or Phase
13.3 Manage Stakeholder
Engagement
13.4 Control Stakeholder
Engagement
Plan Scope Mgt.
5.3
Plan Schedule Mgt.
6.6
7.1 Plan Cost Mgt.
10.3 Control Communications
13. Project Stakeholder
Management13.2 Plan Stakeholder
Management
PMBOK® Fifth Edition, Page 61
Closing
4.6 Close Project or Phase12.4 Close Procurements
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
4.6 Close Project or Phase
Closing: Integration Management
Outputs
Final product, service or result transition
Organizational process assets updates
Tools & Techniques
Expert judgmentAnalytical techniquesMeetings
Inputs
Project management planAccepted deliverablesOrganizational process assets
Page 355
PMBOK® Fifth Edition, Page 100
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
4.6 Close Project or Phase
Close Project or Phase is the process of finalizing all activities across all of the Project Management Process Groups to formally complete the project or phase
Page 355
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
The PM reviews all information from previous phaseclosures to ensure that all work has been done andobjectives have been met. The scope baseline (scope,WBS and WBS dictionary) is reviewed to ensurecompletion.
If a project is terminated before completion, proceduresare established to investigate and document why theaction was taken.
Stakeholders are engaged in the process.
4.6 Close Project or Phase
Page 355
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
4.6.1 Close Project or PhaseInputs: The Project Management Plan (Another Reminder)
Page 356
Plan Scope Management Collect Requirements Define Scope Create WBS Plan Schedule Management Define Activities Sequence Activities Estimate Activity Resources Estimate Activity Durations Develop Schedule Plan Cost Management Estimate Costs
Determine Budget Plan Quality Management Plan Human Resource Management Plan Communications Management Plan Risk Management Identify Risks Perform Qualitative Risk Analysis Perform Quantitative Risk Analysis Plan Risk Response Plan Procurement Management Plan Stakeholder Management
The other 23 planning processes are integrated to create the projectmanagement plan. Updates to any plans require an update to the PM plan. Thinkof the PM plan as a bucket into which all the other plans “drip” until it is full.
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
4.61 Close Project or PhaseInputs: Accepted Deliverables
Page 357
These have all been answers on the test:
• Customer feedback on a more detailed basis
• Done at the end of each Project Phase (not PM phase)
• Results in formal acceptance
ExamTip
The questions on the exam are vague on Scope Validation.Read them carefully.
One question asks for: “the key aspect of scope validation”
Answer: “customer acceptance of project efforts”.The answer does not involve correctness of the work.
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
4.63 Close Project or PhaseOutputs: Final Product, Service, or Result Transition
Pages 358
Final Product, Service, or Result Transition
The output of Close Project or Phase is the transition ofwhat the project was authorized to produce. If it is aphase closure, it is the intermediate product, service orresult of that phase. Formal acceptance includesreceiving a formal statement that the requirements ofthe project or phase have been met.
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
4.63 Close Project or PhaseOutputs: Organizational Process Assets Updates
Pages 359
Organizational Process Assets Updates
Closure will include storage of project documentation using the configuration management system. OPA updated during closure include:
Project FilesAssemble a complete set of project records from all processes for archiving, and updating historical databases. Examples include: the PM plan, scope, cost, schedule, calendars, risk registers, change documents, risk responses, and risk impact.
Project or Phase Closure DocumentsDocumentation showing project completion (or termination) and transfer of deliverables. During closure, the PM reviews closure documents from all prior phases, acceptance documents from Validate Scope and the contract to ensure that all requirements are completed.
Historical InformationLessons learned are transferred to archives for future use. This can be information on issues and risks as well as techniques that worked well and can be applied to future projects.
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
12.4 Close Procurements
Closing: Project Procurement Management
Outputs
Closed procurementsOrganizational process assets
updates
Tools & Techniques
Procurement auditsProcurement negotiationsRecords management system
Inputs
Project management planProcurement documents
Page 360
PMBOK® Fifth Edition, Page 386
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
12.4 Close Procurements
Close Procurements is the process of completing each procurement.
Contract closure involves verification that all the work and deliverables produced under contract were acceptable.
In multi-phase contracts, the term of the contract may only apply to the end of each phase, and this process would close phase-end contracts.
Page 360
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Contract closure involves verification that all the work anddeliverables produced under contract were acceptable. It alsoinvolves updating records to as-built and archiving this informationfor future use. In multi-phase contracts, this process closes phase-end contracts.
Early termination of a contract (or a portion) can result from mutualagreement of the parties or from default of one of the parties, or forconvenience of the buyer. Rights and responsibilities of the partiesare controlled by the terminations clause.
Buyer may have the right to terminate all or part of a contract forcause or convenience at any time, but buyer may have tocompensate seller for preparations, partial completions, andcompleted/accepted work
12.4 Close Procurements
Page 360
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
12.4.2 Close Procurements
Page 327
Tools and Techniques: Procurement Negotiations
Negotiation is the primary goal for settling disputes
If this cannot be achieved, use Alternative Dispute Resolution (ADR) – Mediation or Arbitration
Litigation is the LEAST desirable option.
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
4.6 and 12.4Close Project/Phases and Close Procurements
Be prepared for as many as sixteen questions on these topics:
• Inputs and Outputs
• How Close Project is similar/different from Close Contract(Close Procurements has similar work to Close Project, but with more attention on documentation, completion of files and verification/acceptance.)
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
10.2 Plan Communications
Plan Communications is the process of determining the project stakeholder information needs and defining a communication approach
N(N – 1)
2
Channels =
The formula:
Reveals the number of possible channels of communication in a group, where N is the number of people in the group
One More Time: It was on my examination twice
Page 166-167
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Professional Responsibility
Page 365
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Professional Responsibility
Professional Responsibilitywas introduced into the PMBOK in version in it’s third edition. It requires project managers to consider legal and ethical issues, and at all times to focus on professionalism and advancement of the profession of project management
Page 365
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Professional Responsibility
• Think about Legal, ethical and professional behavior when answering exam questions
• You will be challenged with multiple situational questions
• Read PMI Member Ethical Standards: Member Code of Ethics and Member Standards of Conduct, PMP Code of Professional Conduct
• Follow the law, follow bylaws and cooperate on ethics investigations
• The PMI prefers that ethics be handled through infractions without resorting to formal procedures
• Focus on professionalism, integrity, responsibility, self-improvement, fairness, honesty and communication
• Balance stakeholders’ interests
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Professional Responsibility
Read Pages 365-366 Carefully
Clarifying Information
Pages 365-66
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Professional Responsibility
Page 367
Code of Professional Conduct 2006CHAPTER 1. VISION AND APPLICABILITY 1.1 Vision and Purpose As practitioners of project management, we are committed to doing what is right and honorable. We set high standards for ourselves and we aspire to meet these standards in all aspects of our lives—at work, at home, and in service to our profession. This Code of Ethics and Professional Conduct describes the expectations that we have of ourselves and our fellow practitioners in the global project management community. It articulates the ideals to which we aspire as well as the behaviors that are mandatory in our professional and volunteer roles. The purpose of this Code is to instill confidence in the project management profession and to help an individual become a better practitioner. We do this by establishing a profession-wide understanding of appropriate behavior. We believe that the credibility and reputation of the project management profession is shaped by the collective conduct of individual practitioners. We believe that we can advance our profession, both individually and collectively, by embracing this Code of Ethics and Professional Conduct. We also believe that this Code will assist us in making wise decisions, particularly when faced with difficult situations where we may be asked to compromise our integrity or our values. Our hope that this Code of Ethics and Professional Conduct will serve as a catalyst for others to study, deliberate, and write about ethics and values. Further, we hope that this Code will ultimately be used to build upon and evolve our profession.
1.2 Persons to Whom the Code Applies The Code of Ethics and Professional Conduct applies to: 1.2.1 All PMI members1.2.2 Individuals who are not members of PMI but meet one or more of the following criteria:
.1 Non-members who hold a PMI certification
.2 Non-members who apply to commence a PMI certification process
. .3 Non-members who serve PMI in a volunteer capacity.
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Professional Responsibility
Page 369
Code of Professional Conduct 2006
CHAPTER 2. RESPONSIBILITY 2.1 Description of Responsibility Responsibility is our duty to take ownership for the decisions we make or fail to make, the actions we take or fail to take, and the consequences that result.
2.2 Responsibility: Aspirational Standards As practitioners in the global project management community: 2.2.1 We make decisions and take actions based on the best interests of society, public safety, and
the environment. 2.2.2 We accept only those assignments that are consistent with our background, experience, skills,
and qualifications. 2.2.3 We fulfill the commitments that we undertake – we do what we say we will do. 2.2.4 When we make errors or omissions, we take ownership and make corrections promptly.
When we discover errors or omissions caused by others, we communicate them to the appropriate body as soon they are discovered. We accept accountability for any issues resulting from our errors or omissions and any resulting consequences.
2.2.5 We protect proprietary or confidential information that has been entrusted to us. 2.2.6 We uphold this Code and hold each other accountable to it.
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Professional Responsibility
Page 370
Code of Professional Conduct 2006
2.3 Responsibility: Mandatory Standards As practitioners in the global project management community, we require the following of ourselves and our fellow practitioners:
Regulations and Legal Requirements 2.3.1 We inform ourselves and uphold the policies, rules, regulations and laws that
govern our work, professional, and volunteer activities. 2.3.2 We report unethical or illegal conduct to appropriate management and, if
necessary, to those affected by the conduct.
Ethics Complaints 2.3.3 We bring violations of this Code to the attention of the appropriate body for
resolution. 2.3.4 We only file ethics complaints when they are substantiated by facts. 2.3.5 We pursue disciplinary action against an individual who retaliates against a
person raising ethics concerns.
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Professional Responsibility
Page 371
Code of Professional Conduct 2006CHAPTER 3. RESPECT 3.1 Description of Respect Respect is our duty to show a high regard for ourselves, others, and the resources entrusted to us. Resources entrusted to us may include people, money, reputation, the safety of others, and natural or environmental resources. An environment of respect engenders trust, confidence, and performance excellence by fostering mutual cooperation. 3.2 Respect: Aspirational Standards As practitioners in the global project management community:
3.2.1 We inform ourselves about the norms and customs of others and avoid engaging in behaviors they might consider disrespectful.
3.2.2 We listen to others’ points of view, seeking to understand them. 3.2.3 We approach directly those persons with whom we have a conflict or disagreement. 3.2.4 We conduct ourselves in a professional manner, even when it is not reciprocated.
3.3 Respect: Mandatory Standards As practitioners in the global project management community, we require the following of ourselves and our fellow practitioners:
3.3.1 We negotiate in good faith. 3.3.2 We do not exercise the power of our expertise or position to influence the decisions or
actions of others in order to benefit personally at their expense. 3.3.3 We do not act in an abusive manner toward others. 3.3.4 We respect the property rights of others.
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Professional Responsibility
Page 372
Code of Professional Conduct 2006CHAPTER 4. FAIRNESS
4.1 Description of Fairness Fairness is our duty to make decisions and act impartially and objectively. Our conduct must be free from competing self interest, prejudice, and favoritism.
4.2 Fairness: Aspirational Standards As practitioners in the global project management community:
4.2.1 We demonstrate transparency in our decision-making process. 4.2.2 We constantly reexamine our impartiality and objectivity, taking corrective action as appropriate. 4.2.3 We provide equal access to information to those who are authorized to have that information. 4.2.4 We make opportunities equally available to qualified candidates.
4.3 Fairness: Mandatory Standards As practitioners in the global project management community, we require the following of ourselves and our fellow practitioners:
Conflict of Interest Situations 4.3.1 We proactively and fully disclose any real or potential conflicts of interest to the appropriate
stakeholders. 4.3.2 When we realize that we have a real or potential conflict of interest, we refrain from engaging in
the decision-making process or otherwise attempting to influence outcomes, unless or until: we have made full disclosure to the affected stakeholders; we have an approved mitigation plan; and we have obtained the consent of the stakeholders to proceed.
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Professional Responsibility
Page 373
Code of Professional Conduct 2006
Favoritism and Discrimination 4.3.3 We do not hire or fire, reward or punish, or award or deny contracts based on personal
considerations, including but not limited to, favoritism, nepotism, or bribery. 4.3.4 We do not discriminate against others based on, but not limited to, gender, race, age, religion,
disability, nationality, or sexual orientation. 4.3.5 We apply the rules of the organization (employer, Project Management Institute, or other
group) without favoritism or prejudice.
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Professional Responsibility
Page 373-274
Code of Professional Conduct 2006
CHAPTER 5. HONESTY
5.1 Description of Honesty Honesty is our duty to understand the truth and act in a truthful manner both in our communications and in our conduct.
5.2 Honesty: Aspirational Standards As practitioners in the global project management community:
5.2.1 We earnestly seek to understand the truth. 5.2.2 We are truthful in our communications and in our conduct. 5.2.3 We provide accurate information in a timely manner.
5.3 Honesty: Mandatory Standards As practitioners in the global project management community, we require the following of ourselves and our fellow practitioners:
5.3.1 We do not engage in or condone behavior that is designed to deceive others, including but not limited to, making misleading or false statements, stating half-truths, providing information out of context or withholding information that, if known, would render our statements as misleading or incomplete.
5.3.2 We do not engage in dishonest behavior with the intention of personal gain or at the expense of another.
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Professional Responsibility
Pages 375-377
Read Pages 375-377 Carefully
History of the Standard
Glossary
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Professional Responsibility
Page 378
P.M.P ® Code of Professional ConductI. Responsibilities to the Profession
A. Compliance with all organizational rules and policies. 1. Responsibility to provide accurate and truthful representations concerning all information directly or
indirectly related to all aspects of the PMI Certification Program, including and not limited to the following: examination applications, test item banks, examinations, answer sheets, candidate information, and professional development program reporting forms.
2. Upon a reasonable and clear factual basis, responsibility to report possible violations of the professional code of conduct by individuals in the field of project management.
3. Responsibility to cooperate with PMI concerning ethics violations and the collection of related information. 4. Responsibility to disclose to clients, customers, owners, or contractors, significant circumstances that could be
construed as a conflict of interest, or an appearance of impropriety.
B. Candidate/Certificant Professional Practice. 1. Responsibility to provide accurate, truthful advertising and representations concerning qualifications,
experience, and performance of services. 2. Responsibility to comply with laws, regulations, and ethical standards governing professional practice in the
state/province and/or country when providing project management services.
C. Advancement of the Profession. 1. Responsibility to recognize and respect intellectual property developed or owned by others, and to otherwise
act in an accurate, truthful, and complete manner, including, all activities related to professional work and research.
2. Responsibility to support and disseminate the professional code of conduct to other PMI certificants.
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Professional Responsibility
Page 378
P.M.P ® Code of Professional Conduct
I. Candidate/Certificant Responsibilities to Customers and the Public
A. Qualifications, experience, and performance of professional services. 1. Responsibility to provide accurate and truthful representations to the public in advertising,
public statements, and in the preparation of estimates concerning costs, services, and expected results.
2. Responsibility to maintain and satisfy the scope and objectives of professional services, unless otherwise directed by the customer.
3. Responsibility to maintain and respect the confidentiality of sensitive information obtained in the course of professional activities or otherwise where a clear obligation exists.
B. Conflict of interest situations and other prohibited professional conduct. 1. Responsibility to ensure that a conflict of interest does not compromise legitimate interests
of a client or customer, or influence/interfere with professional judgments. 2. Responsibility to refrain from offering or accepting inappropriate payments, gifts, or other
forms of compensation for personal gain, unless in conformity with applicable laws or customs of the country where project management services are being provided.
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Professional responsibility
Types of Questions to Expect
A. Inform the public …
You are building a water treatment facility. Routine tests indicate that there are contaminants in the water but that they have an extremely low risk of causing sickness. As a project manager you should:
A. Inform the public that a detailed examination has been ordered to determine the extent to which the problem exists
B. Do nothing because there is an extremely low risk except for some effects on small children or the elderly
C. Tell the public there is no problem, except for small children and the elderly who should boil their water before drinking it
D. Educate the public about the advances in water treatment technology and the industry efficiency and safety record
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Professional responsibility
Types of Questions to Expect
B. Requirements
A KEY activity to defining customer satisfaction is to define:
A. Business UseB. RequirementsC. Product SpecificityD. Change Control
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Professional responsibility
Types of Questions to Expect
B. Develop alternative solutions to the problem
When it appears that a design error will interfere with technical performance objectives, the PREFERRED response is to:
A. Decrease the performance value to equal the assessed valueB. Develop alternative solutions to the problemC. Increase the specified value to set a new performance goalD. Reduce the overall technical complexity of the project
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Professional responsibility
Types of Questions to Expect
B. Training
What is the MOST effective practice to ensure that cultural and ethical differences do not impede the success of your multi-national project?
A. Co-LocatingB. TrainingC. FormingD. Teaming
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Professional responsibility
Types of Questions to Expect
A. Mutual trust and cooperation
Negotiating across international cultures involves mutual interdependence between parties. The negotiations MUST be conducted in an atmosphere of:
A. Mutual trust and cooperationB. Generalities and vaguenessC. Sincerity and compassionD. Uncertainty and caution
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
PMP® Certification Test Preparation
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
New Test and New PMBOK® Edition
Page 2
The PMBOK® 5th Edition was released in January 2013. The test changed again on July 31, 2013. A new Knowledge Area was introduced: Stakeholder Management.
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Qualification Requirements
A minimum of 4500 hours PM experience within the past 8
years
A minimum of 7500 hours PM experience within the past 8
years
35 contact hours (PDU’s) of PM
education
+ =
Graduate, 4-Year Degree
Non-Graduate, or 2-Year Degree
Eligibility to take the PMP®
examination
Page 2
This Course ID is E1078 and Awards 24 PDU’s
The T&T CD ID is E1091 and Awards 11 PDU’s
PMTestOnline is C4070 and Awards 11 PDU’s
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
PMBOK Fifth Edition and the New Test
The PMBOK Fifth Edition was introduced in January 2013, and the new fifth edition test started on July 31, 2013.
The PMP examination consists of 200 questions, with a four hour time limit
That’s 72 seconds (or 1.2 minutes) per question
This training course will give you everything you need,with a little self-study, to pass the PMP® examination
Visit www.pmi.org, download PMP Certification Handbook
Page 2
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
PMBOK 5th Edition PMP Test Domain Content
Project Initiation 13% Project Planning 24% Project Execution 30%Project Monitoring & Control 25%Project Closing 8%
Page 2
To pass, you need to get a minimum of 122
questions correct out of 200 questions (61%)
Pass rate on the 4th Edition test is about 74%
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
http://www.pmi.org/Certification/Project-Management-Professional-PMP.aspxLog in with your User Name and PasswordFollow the instructions
Submit your application to Project Management Institute (PMI)
PMI ® may audit when you pay your exam fee to PMI. If you cancel or reschedule within 30 days of the test, there is a fee of $70; within 2 days, you forfeit the entire fee.
http://www.pmi.org/info/PDC_PMPHandbook.pdf
Control is through audit (when you pay)
Schedule a test date with Prometrichttp://www.prometric.com/PMI/default.htm
Apply to PMI to take the test,
Schedule a date with Prometric
Candidates have three (3) opportunities to pass the exam in one year. If they
do not pass any, they must wait one (1) year from the date of the last attempt.
Page 3
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Taking the PMP® examination
Ensure you have the required
experience
Complete a PMP® Prep
course
Send in your
application
Ensure you have 35 PDU’s
AND
Join the PMI® (if you
haven’t)
Study hard for about 2 weeks
Take the exam
and pass
www.pmi.org
Schedule exam at
Prometrics
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Applying to Take The Exam
• Apply using the PMI web site. http://www.pmi.org/Certification/Project-Management-Professional-PMP.aspx
• Using the PMI® web site to complete the application is fast and easy. Turn around to approval is normally just a few days, but it may take a little longer.
• Sometimes your test center may not have an opening for a few weeks.
• On the computerized test, the questions are in English, but pop-up screens will aid you in understanding the question in your native language. This feature must be requested by you in your application.
• In some countries, the test may be given on paper, in English, not in your native language.
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Taking the PMP® examination
Number of Questions: 200
Time for the Exam: 4 Hours
To Pass: you must get about 122 of 200 questions correct About 61%
Questions are randomly generated, 4-option, multiple choice.
Questions not answered are wrong - answer all questions.
Don’t be surprised if some long questions are early in the exam
and you get behind on time.
Breaks are allowed, but extra time is NOT allotted for them.
In most test centers you must sign out and sign back in, which takes time
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Reasons people fail the exam
• They do not read all the questions correctly
• They do not read all the choices in each question
• They are too nervous• They have not studied enough or use
source books other than the PMBOK®• They believe they can rely purely on
experience• They have not taken a PMP® prep
course like this one
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• Go to the test center before the day of your test, find where it is, look at the testing room, talk to the administrator.
• Bring your PMI® authorization e-mail or letter to the test site.
• Bring a picture identification.
• PMI has recently decided not to allow any personal calculators in the testing room. A pop-up calculator is available on the computer. If that is awkward for you to use, ask the administrator to provide a calculator for you.
• You will be given scrap paper, pencils, and in some test centers, earplugs.
• All personal items will be safely stored for you and cannot be taken into the test room.
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Taking the PMP® examination
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
• Upon entering the test room, you will be given 15 minutes to use the computer tutorial and to become familiar with the commands. You can mark questions on the computer and return to the marked questions later, or you can review every question.
• Use the entire 15 minutes to write information you need to remember on the scratch paper.
• You will see one question on the screen at a time.
• Many people finish the exam ahead of the 4-hour limit and return to “marked” questions for review/correction.
• When you finish the exam or when the time limit is expired, your answers are immediately graded. The computer tells you if you pass. A temporary certificate is printed at the test center, and you immediately become a PMP®. PMI® will post a formal certificate to you later.
• If you do not pass, PMI® will be notified and will send you information about retaking the exam. See PMI®s website about the additional fee.
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Taking the PMP® examination
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Hints on Test Questions
Choices like “A or B” and “never and always” have been removed.
Watch out for distractors - choices that are true, but not the best answer.
There are about 45 to 75 “what should you do in this situation” questions.
Most people feel unsure about 50 of the 200 questions.
You must be familiar with PMI®-specific definitions. A big trick to success on the exam is to try touse PMI®’s perspective, not your experience. If that does not work, then use your training and lifeexperiences.
Read the last sentence of each question first. What is the question asking?
Read ALL FOUR answers, without making a choice.
Read the whole question. Understand the topic and descriptors. Read the last sentence AGAIN,then eliminate two of the four answers.
Read the last sentence AGAIN, then pick the best of the two remaining answers.
About 8 to 12 questions deal with PMBOK® step-by-step processes and the input/output toprocesses.
There have been less than 8 earned value questions on the exam in the last three years.
Use all the exam time; do not leave early unless you have reviewed each question twice.
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Turn to page 449 in the workbookThere are 100 questions.
You have 120 minutes to completeAnswers are on page 475
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Hint: Use scratch paper for answers,so you can reuse the questions for practice
Practice Test #3
CONGRATULATIONS !!!
You have just completed more than the entire PMP Test!
You have done 228 questions
PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013
Let us know when you pass, andSend us “surprises” you remember !