pmp prep-5th ed-bmc master-oct 2013 (1).pdf

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PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013

PMP® Certification Test Preparation

PMBOK® Fifth Edition

Presents




The PMP

®

Certification Test Preparation

Objectives

Provide a framework for structuring the ProjectManagement Body of Knowledge;

Identify the most generally accepted practiceswithin 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

Beijing

Shanghai

Tokyo

TaipeiMilan

Lisbon

Mumbai

Warsaw

Frankfurt

Houston

Brussels

Istanbul

Singapore

SeoulMoscowWashington DC

Vancouver

Atlanta

Bristol



PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013Page iv

Our Learning Institutions




Three Day Course Schedule

Page vii

Day Two

Planning Processes(continued)

Practice Test

Executing Processes

Day Three

Monitoring & ControllingProcesses

Practice Test

Closing Processes

Professional Responsibility

Preparing for the PMP

Day One

Introduction and overviewof PMI, PMP and PMBOK

Initiating Processes

Planning Processes

Sample Test




Introduction and Overview of the PMP

®


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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 aproject through to Closing the project.

Page 1



Planning

Processes

ExecutingProcesses

Monitoring &

Controlling Processes

Initiating

Processes

Page 1

Organization is Chronological

Closing

Processes



New Test and New PMBOK ® Edition

Page 2

The PMBOK® 5th Edition was released in January2013. The test changed again on July 31, 2013.

A new Knowledge Area was introduced:Stakeholder Management.



Qualification Requirements

A minimum of 4500 hours PMexperience within the past 8

years

A minimum of 7500 hours PM

experience within the past 8years

35 contact hours(PDU’s) of PM

education+ =

Graduate, 4-Year Degree

Non-Graduate, or 2-Year Degree

Eligibility to takethe PMP®

examination

Page 2

This Course ID is E1078and Awards 24 PDU’s

The T&T CD ID is E1091and Awards 11 PDU’s

PMTestOnline is C4070

and Awards 11 PDU’s



PMBOK Fifth Edition and the New Test

The PMBOK Fifth Edition was introduced in January 2013, and thenew fifth edition test started on July 31, 2013.

The PMP examination consists of 200 questions, with a four hourtime 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

http://www.pmi.org/

http://www.pmi.org/



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%



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 reschedulewithin 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 theydo not pass any, they must wait one (1) year from the date of the last attempt.

Page 3



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

Page 4




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

Page 4




Questions designed to make you make you think carefully

The theory “optimum quality level is obtained when

Incremental 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

Page 4




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 motivators

D. Entitlements

A. Perquisites (aka “Perks”)

Page 5





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

Page 5





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





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





Questions requiring calculation and knowledge of formulae

A project was estimated to cost $1.5 million and scheduled to lastsix months. After three months, the earn value analysis showsthe following:

BCWP (EV) = $650,000

BCWS (PV) = $750,000ACWP (AC) = $800,000

What are the schedule and cost variances?

A. SV = +$100,000 - - - CV = +$150,000B. SV = +$150,000 - - - CV = -$100,000

C. SV = -$50,000 - - - - CV = +$150,000D. SV = -$100,000 - - - -CV = -$150,000

D. SV=-S100,000 : CV=-$150,000

Page 6





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 becompleted on time and under budget by $200,000. Based on your

calculation, your personal profit will decrease by $2,000. Givenestimated 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

Page 6





Questions using acronyms you need to understand

There are several different types of network analysis tools fordetermining critical path. Which method for analysis is also calledMethod of Moments?

A. GERTB. CPMC. PERTD. Monte Carlo

C. PERT (Program Evaluation and Review Technique)

Extra

Mapping Process Groups to Knowledge Areas



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 Scope

Management

5.1

Collect Requirements5.2Define 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 Costs7.3 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 Team9.3 Develop Project Team

9.4 Manage Project Team

10. ProjectCommunicationsManagement

10.1 Plan Communications

Management10.2 Manage Communications

11. Project RiskManagement

11.1 Plan Risk Management11.2 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 5th Edition,

Table 3-1, Page 61

(47 Processes)




Mind Maps: Integration

Handout




Mind Maps: Scope

Handout

Scope



PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013Handout

Time

Mi d M C t




Mind Maps: Cost

Handout

Project Q alit Management




Mind Maps: Quality

Handout

Project Quality Management




Mind Maps: Human Resource

Handout

Communication




Communication

Ri k




Risk

P t




Procurement

Stakeholders




Stakeholders




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 toobtain benefits not obtainable from managing them

individually.• A portfolio is a collection of projects, programs, and

operations managed as a group to achieve strategicobjectives.

• An operation is an organizational function performing theongoing execution of activities that produce the sameproduct or provide the same repetitive service

Page 7




Scope(Planned Results)

Resource(Budget)

Schedule(Time)

PMBOK 5th Edition, Page 6The Triple Constraint, plus some.

Page 8




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






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)

Comparison: Project Program & Portfolio




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, anddegree 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 componentlevel.

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 benefitrealization 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




How do projects come about?

Projects can come about in the following ways:

Market demandStrategic opportunitySocial need

EnvironmentalCustomer requestTechnological advanceLegal requirement

Page 10

More on selection methods later

PMBOK 5th Edition, Page 10

Off ( O)




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

T f P j M Offi (PMO)




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

Project

Based Organizations (PBO)




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 ratherthan as a function, but can have functional supportareas.

Project-Based Organizations (PBO)

Page 13

R l f th P j t M




Project Managers

Page 15

Role of the Project Manager

Role is to achieve project objectives. Understanding tools andtechniques is not enough. It requires general managementskills, and: Knowledge of project management, Performance or accomplishment,

Personal behavior and effectiveness when performingthe project including attitude, personality characteristics,and leadership.

Th R l f th PMBOK

®




The Role of the PMBOK®

PMBOK ® Guide

Project Management

Body of Knowledge

Application AreaKnowledge,

Standards and

Regulations

Interpersonal

Skills

Understanding

the ProjectEnvironment

General

Management

Knowledge and

Skills

Page 15

O i ti l St t




Organizational

Structures

ProjectCharacteristics

Functional ProjectizedMatrix

Weak Matrix Balanced Matrix Strong Matrix

Little or None

Little or None

FunctionalManager

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

FunctionalManager

MixedProject

ManagerProject

Manager

Low

Low

Low toModerate

Low to

Moderate

Moderate toHigh

High toAlmost Total

Moderate to

High

High to

Almost Total

Organizational Structures PMBOK® Fifth Edition, Page 22

Page 16

O i ti l I fl




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 tolocating 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

O i ti l St t




Organizational Structure PMBOK® Fifth Edition, Page 22

Page 18

ChiefExecutive

FunctionalManager

FunctionalManager

FunctionalManager

Staff

Staff

Staff Staff

Staff

Staff

Staff

Staff

Staff

Staff engaged in project activities

ProjectCoordination

Functional Organization

O i ti l St t





Page 18

Weak Matrix ChiefExecutive

FunctionalManager

FunctionalManager

FunctionalManager

Staff

Staff

Staff Staff

Staff

Staff

Staff

Staff

Staff


ProjectCoordination

O i ti l St t





Page 19

Balanced Matrix ChiefExecutive

FunctionalManager

FunctionalManager

FunctionalManager

Staff

Staff

Project

Manager

Staff

Staff

Staff

Staff

Staff

Staff


ProjectCoordination

Organizational Structure




Manager of ProjectManagers


Page 19

Strong Matrix ChiefExecutive

FunctionalManager

FunctionalManager

FunctionalManager

Staff

Staff

Staff Staff

Staff

Staff

Staff

Staff

Staff

Staff engaged in project activitiesProject

Coordination

Project Manager

Project Manager

Project Manager






Page 20

Projectized ChiefExecutive

ProjectManager

ProjectManager

ProjectManager

Staff

Staff

Staff Staff

Staff

Staff

Staff

Staff

Staff

Staff engaged in project activitiesProject

Coordination






Page 20

Composite ChiefExecutive

FunctionalManager

FunctionalManager

FunctionalManager

Staff

Staff

Staff Staff

Staff

Staff

Staff

Staff

Staff

Staff engaged in project activities Project ACoordination

Manager of ProjectManagers

Project Manager

Project Manager

Project Manager

Project BCoordination

The Organization and it’s Environment




The Organization and it s Environment

Enterprise Environmental Factors (EEF)EEF are conditions not under the control of the team. They includegovernment or industry standards, organization culture,infrastructure (facilities & equipment), human resources,

marketplace conditions, risk tolerance, politics, communicationchannels, 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 andprocedures, and (2) corporate knowledge bases. They includeplans, processes, policies, procedures, lessons learned, historicalinformation, schedules, risk data, and earned value data.

What have we got?

Stakeholders




Stakeholders are persons or organizations who may affect, be affected, or perceive thatthat 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 withstakeholders’ needs or objectives. It is critical to management of stakeholder

engagement, maximizing the value of project outcomes, and aligning projects to thebusiness strategy.

The Project Manager should manage the influences of stakeholders regarding projectrequirements to ensure successful outcome.

Pages 22-23

Who are your stakeholders? Can you name them?See PMBOK® Fifth Edition, Pages 32-33

Stakeholders

The Project Sponsor




The Project Sponsor

The Project Sponsor is the person or group whoprovides resources and support for the projectand is accountable for enabling success. Thesponsor promotes the project and serves asspokesperson to management. They play a

significant role in project initiation and thedevelopment of the initial scope and charter

Page 22

Project Life Cycle




Startinga Project Organizingand

Preparing

Executing the Work Closing aProject

C o s t a n d S

t a f f i n g L e v e l

Time

ProjectCharter

ProjectManagement Plan

AcceptedDeliverables

ArchivedProject

Documents

Project Life Cycle

Page 24

Stakeholders Influence Over Project Performance




Stakeholders Influence Over Project Performance

Page 24

Value

Time

Concept Planning Execution Close-Out

Amount at Stake

Uncertainty (Risk)

Influence of Stakeholders

Process Groups are not Project Phases





Phased System Development Life Cycle (SDLC) to Launch

DevelopmentProduction

TechnologyTrials Production

Laboratory

Model LAUNCHIDEA

Feasibility

Study

INPUTS:

Market Basic Requirements

Knowledge Concept Specification Marketing

Technology Department’s K ey Technical Pr oof of Pr ototype Beta Test Pr oduction Pr oduct

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 TestAssessment Models

OUTPUTS:

Project Phases or Life Cycle(Phase-end reviews of deliverables are called

Stage Gates, Phase Exits, or Kill Points)






Process Groups PMBOK® Fifth Edition, Pages 42-43

Links between Process Groups in a Phase

Planning

Processes

Executing

Processes

Monitoring &


Initiating

Processes

Closing

Processes

Planning

Processes

Executing

Processes

Planning

Processes

Executing

Processes

Monitoring &


Initiating

Processes

Closing

Processes

Plan Do

CheckAct

Walter Shewhart,modified

by Edwards Deming

ExamTip






BeginEnd

Project Lifecycle

Charter Handover

Phase 1 Phase 2 Phase 3 Phase 4

Understand the Differences Between:




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

Overview of Project Integration Chapter 4 of the PMBOK®




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

Initiating Process Group




Initiating Process Groupby Chronology

Page 31

Process Groups

Initiating Planning Executing ClosingMonitoring &

PMBOK® Fifth Edition, Page 61





Controlling




Change Control

5. Project ScopeManagement

5.1

Collect Requirements5.2

Define Scope

5.5 Validate Scope

5.6 Control Scope


6.1




7.2 Estimate Costs

7.3 Determine Budget

7.4 Control Costs





9.1 Plan Human







11.1 Plan Risk Management

11.2 Identify Risks11.3 Perform QualitativeRisk Analysis



11.6 Control Risks





5.4 Create WBS

6.4

4.6 Close Project

or Phase


Engagement


Engagement

Plan Scope Mgt.

5.3

Plan Schedule Mgt.

6.6

7.1 Plan Cost Mgt.




Management

Initiating







Initiation results in:

GO

NO GO

DECISION


Page 30

Initiation: Project Integration Management





Initiation: Project Integration Management

Outputs

Project charter

Tools &Techniques

Expert judgmentFacilitation techniques

Inputs

Project statement of work

Business caseAgreementsEnterprise environmental factorsOrganizational process assets

Page 31

4 1 Develop Project Charter





Develop Project Charter is the process ofdeveloping a document that formally

authorizes the existence of a projectand provides the project manager withthe authority to apply organizational

resources to project activities.

The project manager is assigned early inthe project, during charter development.

ALWAYS before start of planning.

Page 31

ExamTip






Page 32

CustomerRequirements

• Problem

• Opportunity

• Business Need

ProjectInitiation

• Commitment to goahead

• Project Charter

• Project Managerassigned

Project

Planning






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 theend product

• Is progressively elaborated throughoutthe project life cycle

• Includes the Strategic Plan, a factorwhen 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






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 before

deciding 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.






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 industry

standards, 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






Page 35

Output: Project CharterPMBOK® Fifth Edition, Page 71

ExamTip






SelectedProjects

SuggestedProjects

Project Selection

Techniques

Net Present ValueReturn on Investment

Internal Rate of Return

Benefit/Cost Ratio

Opportunity Cost

Page 35

Project selection methods Economic Models

ExamTip




Project selection methods Economic Models

Net Present Value: net economic value (per year) of a project in terms of

present-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 the

project. Organizations may have a minimum rateof return (or hurdle rate).

A higher rate of return is better

Page 37

Tip

Project selection methods

Economic Models




j

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 Value

r = Interest Raten = Number of Time Periods

Average Earnings After Tax

Average InvestmentARR

(Accounting Rate ofReturn)

Benefit Cost Ratio : Benefits should exceed costs. The higherBCR wins.

=

Page 37

Project selection methods

Example Question




Project selection methods Example Question

Exam

Tip

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 upwhen you made your selection

Page 37

Exercise

Net present Value




p

Page 38

TIME PERIOD (YR) AMOUNT ($)PRESENT VALUE AT

10% INTEREST RATE

1 50 45

2 100 83

3 300 225

Exercise

Accounting Standards




PROJECT A PROJECT BWhich Project

Would You

Pick?

Net Present

Value$95,000 $75,000 A

IRR 13% 17% B

Payback

Period16 months 21 months A

Benefit Cost

Ratio2.79 1.3 A

g

Project Selection Methods

Weighted Scoring




j g g

Si = sijw j

j = 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 considersrelative importance of different evaluation factors

Project Selection Methods

Decision Models




$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.

j

Initiation: Project Stakeholder ManagementPMBOK

® Fifth Edition Section 13 1 Page 393





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





y

• It is critical for project success toidentify the stakeholders early in theproject, and to analyze their levels ofinterest, expectations, importanceand influence

• Stakeholders should be classifiedaccording to their interest,involvement and influence in theproject

Who are your stakeholders? Make sure you can name them?

Page 40

Stakeholder Analysis Tools and Techniques




y

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

Change

AgentBystanderResistor

P o w e r 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.

Planning Process Group




g

Page 45

Process Groups


Monitoring &

Controlling


Planning







Change Control


5.1


Define Scope

5.5 Validate Scope

5.6 Control Scope


6.1




7.2 Estimate Costs


7.4 Control Costs





9.1 Plan Human








11.2 Identify Risks




11.6 Control Risks





5.4 Create WBS

6.4

4.6 Close Project

or Phase


Engagement


Engagement

Plan Scope Mgt.

5.3

Plan Schedule Mgt.

6.6

7.1 Plan Cost Mgt.




Management

Planning

4.2 Develop Project Management Plan5.1 Plan Scope Management5.2 Collect Requirements

5.3 Define Scope5.4 Create WBS6.1 Plan Schedule Management6.2 Define Activities6.3 Sequence Activities6.4 Estimate Activity Resources6.5 Estimate Activity Durations

6.6 Develop Schedule7.1 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 Management

11.2 Identify Risks11.3 Perform Qualitative Risk Analysis11.4 Perform Quantitative Risk Analysis11.5 Plan Risk Response12.1 Plan Procurement Management13.2 Plan Stakeholder Management

24Plans

Planning is Iterative




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 you

to 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

Page 45

Project Planning




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

Planning: Integration Management





Outputs

Project management plan

Tools &Techniques

Expert judgmentFacilitation techniques

Inputs

Project charterOutputs from other processesEnterprise environmental factorsOrganizational process assets

Page 47





Develop Project ManagementPlan is the process of defining,preparing, and coordinating allsubsidiary plans and integratingthem into a comprehensiveproject management plan.

It is the central document thatdefines the basis of all project

work.

Page 47

I t

The Project Management Plan




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

Pages 45 & 49





Subsidiary Plans

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

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

Planning: Project Scope Management




5.1 Plan Scope Management

Outputs

Scope management planRequirements management

plan

Tools &Techniques

Expert judgmentMeetings

Inputs

Project management planProject charterEnterprise environmental factorsOrganizational process assets

Page 51

Project Scope Management




Ensures that the project includes all the work required,

and only the work required, for the project to completesuccessfully. It defines and controls what is and is not inthe 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

Plan Scope Management




5.1.1 Inputs

+

Outputs of Previous Processes:

Project Management Plan

Project Charter

Always Inputs:

EEF

OPA

Page 52





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

Planning: Scope Management PMBOK

®

Fifth Edition, Section 5.2, Page 110




5.2 Collect Requirements

Outputs

Requirements documentationRequirements traceability

matrix

Tools &Techniques

InterviewsFocus GroupsFacilitated WorkshopsGroup Creativity TechniquesGroup Decision Making

TechniquesQuestionnaires and SurveysObservationsPrototypesBenchmarking

Context DiagramsDocument Analysis

Inputs

Scope Management Plan

Requirements ManagementPlanStakeholder Management PlanProject CharterStakeholder Register

Page 54

5.2 Collect Requirements




Collecting Requirements is the process ofdetermining, documenting, andmanaging stakeholders needs andrequirements to meet project objectives

Requirements include the quantified and

documented needs and expectations ofthe sponsor, customer and otherstakeholders

Requirements must be detailed enoughto allow precise measurements during

Project Execution.

Tools and Techniques

InterviewsFocus GroupsFacilitated WorkshopsGroup Creativity TechniquesGroup Decision Making TechniquesQuestionnaires and SurveysObservationsPrototypesBenchmarkingContext Diagrams

Document Analysis

Page 48

5.2.1 Collect Requirements




Interviews: talk with all stakeholders, checklists

Focus groups: talk with prequalified stakeholdersFacilitated 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 needsGroup 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

5.2.2 Collect Requirements ExamTip




Tools and Techniques: Group Creativity Techniques

Brainstorming: a technique to generate multiple ideas on requirements.

Does not include voting or prioritization., but is oftenused 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.

Tip





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.





Outputs

Requirements progressively elaborated

Documentation: record: how each requirement meets the businessneed. explicit, measurable, accepted in writing

Traceability Matrix: a table linking requirements to their origin

traces then over the project life cycle a structurefor managing scope changes

Example Requirements Traceability Matrix

Planning: Scope Management PMBOK

®

Fifth Edition, Section

5.3,

Page

120




5.3 Define Scope

Outputs

Project scope statementProject documents updates

Tools &Techniques

Expert judgmentProduct analysisAlternatives generationFacilitated workshops

Inputs

Scope management planProject charterRequirements documentationOrganizational process assets

Page 59

5.3 Define Scope




“... 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 agreedscope of work.

• You may see a variety of questions relating to this in Scope and Quality areas.

Page 59

Requirements vs. Scope PMBOK

Fifth Edition, Page 121




Not all of the requirements identified in “CollectRequirements” may be included in “Define Scope.”

“Define Scope” selects the final project requirements.

Scope is progressively elaborated. Detailed scope isdetermined one iteration at a time.

ExamTip

Page 60

5.3.1 Define ScopeI t



PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013Pages 60 & 61

Inputs

o P r e r e q u i s i

t e s a r e t h

e p r o j e c t

s t a t e m e n t

o f w o r k (

S O W ) a n d

t h e

b u s i n e s s c

a s e ( n e e d

f o r t h e p r

o j e c t

a n d c o s t/ b

e n e f i t a n a

l y s i s

o P r o j e c t p u

r p o s e o r j u

s t i f i c a t i o n

o M e a s u r a b

l e o b j e c t i v

e s

o A s s i g n e d p

r o j e c t m a

n a g e r, a u t

h o r i t y

a n d r e s p o

n s i b i l i t y

o H i g h - l e v e

l r e q u i r e m

e n t s, p r o j e

c t

d e s c r i p t i o n

, a n d r i s k s

o S u m m a r y b

u d g e t a n d

m i l e s t o n e

s

o C r i t i c a l s u c

c e s s f a c t o

r s

o F u n c t i o n a l o r g a

n i z a t i o n s

a n d t h e i r

p a r t i c i p a t

i o n

o N a m e a n d

a u t h o r i t y

o f s p o n s o r

+

+

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)

5.3.2 Define ScopeT l d T h i





+

+

Almost always a Tool:

• Expert Judgment

• Product Analysis

Translate objectivesinto deliverables

• Facilitated Workshops

key players reach understandingof the project objectives andtheir limits.

• Alternatives Generation

develop options usingbrainstorming, lateral thinking,alternatives analysis, etc.

5.3.2 Define Scope PMBOK Fifth Edition, Section 5.3, Page 122

Tools and Techniques: Product Analysis Value Analysis Example




Tools and Techniques: Product Analysis, Value Analysis Example

Cost/Benefit Analysis

Benefits:increased revenue

capital assetsregulatory compliancestrategic positioning

Costs:liquid assets consumedresources occupieddeferred opportunities

5.3.3 Define Scope PMBOK Fifth Edition, Section 5.3, Page 123

Outputs



PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013Page 62 & 63

Outputs

+

Subject matter document:

• Project Scope Statement

• Documents Updates:

Stakeholder register Requirements docs Traceability matrix

Includes

5.3.3

Define ScopeExam




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

Tip

5.3 Define Scope




Sponsor

ProjectManager

Charter

Scope

Statement

Product scope descriptionAcceptance criteriaDeliverablesProject exclusionsConstraintsAssumptions

Summary

High level

Planning: Scope Management




5.4 Create WBS

Outputs

Scope baselineProject document updates

Tools &Techniques

DecompositionExpert judgment

Inputs

Scope management plan

Project scope statementRequirements documentationEnterprise environmental factorsOrganizational process assets

Page 64

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

5.4 Create WBS PMBOK® Fifth Edition, Page 129




City Gentrification

LandscapingTree PlantingPreparation

MarkHoles

DigHoles

PlantTrees

FillHoles

Lay Turf Water

Soil

• At the lowest level of the WBS, workcan 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

5.4.1 Create WBS PMBOK® Fifth Edition, Page 127

Inputs




Inputs

+

Page 65


• Scope Management Plan

• Project Scope Statement

• Requirements Documentation

Always Inputs:

• EEF(industry WBS standards)

• OPA (procedures, templates, lessons

learned, files)







Decomposition

Decomposition is the subdivision of deliverables into smaller, more

manageable components until they are defined to the work package

level, where schedule and cost can be reliably estimatedwithout going to level that takes more effort to administer than is

worthwhile.

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

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

5.4.2 Create WBSTools and Techniques: Example




Tools and Techniques: Example

Page 67

Study Concept Prototype Qualification

Typical

Project

Pilot Production ProjectManagement

Chronological

SalesProduct

EngineeringPurchasing

QualityControl

Typical

Project

Job ShopManufacturing

Department

Project

Management

Functional

5.4.2 Create WBSTools and Techniques: Example of WBS by Phase




Tools and Techniques: Example of WBS by Phase

Page 68

SeagramMIS

Project

FunctionalRequirements

Definition

ProjectDefinition Analysis Design Construction Implementation Support

ProjectManagement

Process &Package

Evaluation

AnalysisCheck Point

Design &Integration

Installation

DesignCheck Point

UserProcedures &

Training

ProgramGeneration& Testing

DevelopmentSign Off

Training & UserAcceptance

User SignOff


-

132

Outputs




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

5.4.2 Create WBSOutputs, example of software to create WBS




Outputs, example of software to create WBS

Page 70

5.4.2 Create WBSOutputs, The WBS Dictionary

,

PMBOK

Fifth

Edition, Page

132




Outputs, 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 teammember.

Creating a WBS(Post-It Note Process)

Task “A” Specs. & Req.

Start Date Stop Date

Est. HoursWho?

= Task Description

5.4.2 Create WBSDo not confuse WBS with other breakdown structures




o o co use S o e b ea do s uc u es

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 departmental

breakdown 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 of resources by type used on the project.

5.4.2 Create WBSOBS: Organizational Breakdown Structure




g

Page 71

Project

Design Production

Comp. #2Comp. #1Comp. #2Comp. #1

C o m p a n y

E n g i n e e r i n g

M a n u f a c t u r

i n g

A

s s e m b l y

P a r t s

E l e c t r i c a l

M e c h a n i c a l

CostAccount

CostAccount

CostAccount

CostAccount

Cost

Account

CostAccount

Cost

Account

CostAccount

Cost Accounts provide a

way to control howfunctional organizationsto charge to projects.

WBS Codes showfunctional managersexactly what their

people are doing onthe project.

5.4.2 Create WBSOutputs




p

Page 72

Phrases about WBS that have been answers on theexam:

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.

5.4.2 Create WBSOutputs, WBS




p ,

Page 72

• The structure of the WBS should reflect the way theproject work will be performed and managed

• The WBS should be broken down to the level ofdetail needed to provide control of the work (80hour 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 uniqueidentifier that codes its position in the WBS and anyparent/child relationship among WBS elements

• Each WBS element should have an associated deliverable or set of deliverablesthat allow an indication of work progress and completion

5.4.2 Create WBSWBS Terminology




gy

Page 73

Chart of Accounts: a numbering systemused to monitor costs by category (e.g.,labor, supplies, travel)

Code of Accounts: The collection ofunique identifiers for each WBS element

Cost Account: A code that allows afunctional group to charge for work on aspecific element of project work

Work Order: A request for a functionalgroup to work on a specific element of aproject

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 oractivities by team members on larger projects.

6 1

Plan Schedule Management

Planning: Project Time Management PMBOK Fifth Edition, Page

145




6.1 Plan Schedule Management

Outputs

Schedule management plan

Tools &Techniques

Expert judgmentAnalytical techniquesMeetings

Inputs

Project Management Plan

Project CharterEnterprise environmental factorsOrganizational process assets

Page 74

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

6.1.1 Plan Schedule ManagementInputs

PMBOK® Fifth Edition, Page

146




+


• 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)

6.1.2 Plan Schedule ManagementTools and Techniques




• Expert Judgment• Analytical Techniques

(techniques to estimate and schedule theproject, PM software, fast track or crash,risk assessment)

• Meetings(to develop the plan)

6.1.3 Plan Schedule ManagementOutputs




• Schedule Management Plan(model development, accuracy, units,procedures, control thresholds,performance measurement rules, reportformats, process descriptions)

6 2

Define Activities

Planning: Project Time Management PMBOK® Fifth Edition, Page

149




6.2 Define Activities

Outputs

Activity listActivity attributesMilestone list

Tools &Techniques

DecompositionRolling wave planningExpert judgment

Inputs

Schedule Management Plan

Scope baselineEnterprise environmental factorsOrganizational process assets

Page 77





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.

Page 77





City Gentrification


MarkHoles

DigHoles

PlantTrees

Fill Holes Lay Turf Water

Soil

Page 80

Check groundMeasure distancesNail stakes…

Actions

Work Packages

6.2.1 Define ActivitiesInputs




+


• Schedule Management Plan• Scope Baseline

(Scope Statement, WBS, and WBSDictionary)

Always Inputs:

• EEF (culture, commercial databases,

PMIS)

• OPA (lessons learned, processes,

templates, activity procedures)

6.2.2 Define ActivitiesTools and Techniques




• 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)

6.2.2 Define ActivitiesTools and Techniques




Rolling Wave PlanningRolling 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 higher

level 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.

Page 78 & 79

6.2.1 Define ActivitiesDefinitions




Sometimes PMP Candidates do not understand thesubtle distinction between an Activity Definition and aWork Breakdown Structure (WBS). This may help:

Activity Definition Outputs areACTIONS TO BE DONE

W.B.S. Outputs areDELIVERABLES(Tangible Items)

ExamTip

Page 79

6.2.3 Define ActivitiesOutputs




City Gentrification


MarkHoles

DigHoles

PlantTrees

Fill Holes Lay Turf Water

Soil

1. Check ground2. Measure distances3. Nail stakes…

Page 80

Activity List

6.3

Sequence Activities

Planning: Time Management PMBOK®

Fifth

Edition, Page

153




q

Outputs

Project schedule networkdiagramsProject documents updates

Tools &Techniques

Precedence diagramming

method (PDM)Dependency determinationLeads and lags

Inputs

Schedule management planActivity list

Activity attributesMilestone listProject scope statementEnterprise environmental factorsOrganizational process assets

Page 82

Activity Sequencing

6.3 Sequence Activities




Activity Sequencing

Activity sequencing means identifying and documenting logical relationships

among 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 of activities and dependencies. It is usually more effective to have the team dosome form of manual activity sequencing before turning to projectmanagement software for scheduling.

Page 82

6.3 Sequence Activities




Activities are commonly sequenced using the PrecedenceDiagramming 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 externaldependencies

Lead and lag times add realism to the schedule (you Lead Into fast track, and Lag out to add a gap between activities)

Page 82

6.3.1 Sequence ActivitiesInputs



PMP®

Prep: PMBOK®

5th

- 2013PMP®

Prep: PMBOK®

5th

- 2013Page 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 allmilestones and if they are mandatory (contractual)They have zero duration.

• Project Scope Statement• EEF and OPA

6.3.2 Sequence ActivitiesTools and Techniques, Precedence Diagramming Method (PDM)



PMP®

Prep: PMBOK®

5th

- 2013PMP®

Prep: PMBOK®

5th

- 2013Page 84

Dependencies used in PDM

F-F

S-S

S-F

Activity A Activity B

Activity C

Activity D

Activity E

F-S

6.3.2 Sequence ActivitiesTools and Techniques, Precedence Diagramming Method (PDM)

also called Activity on Node



PMP®

Prep: PMBOK®

5th

- 2013PMP®

Prep: PMBOK®

5th

- 2013

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

6.3.2 Sequence ActivitiesTools and Techniques, Arrow Diagramming Method (ADM)

also called Activity on Arrow [

Not in

Fifth

Edition may be on test

]



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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

DE

2

4 5

3

Exam

Tip

6

F

6.3.2 Sequence ActivitiesTools and Techniques, Conditional Diagramming Method

Graphical Evaluation and Review Technique (GERT)



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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

6.3.2 Sequence ActivitiesTools and Techniques, Dependency Determination



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Mandatory Dependencies (Hard Logic):

Dependencies based on technological constraints, such as notbeing 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 usethe 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.

6.3.2 Sequence ActivitiesTools and Techniques



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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 finish

the 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

Page 87

6.3.2 Sequence Activities




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o A hammock is a summary level activityrepresenting a group of relatedactivities

o A subnet or fragnet is a sub-project ofa larger network diagram

o A hanger is an unintentional break inthe network diagram usually due toomitting either activities or logicalrelationships

Page 87

6.3.3 Sequence ActivitiesOutputs



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• Project Schedule Network Diagrams(a graphical representation of activities showingdependencies)

• Project Documents Updates(include activity lists and attributes, milestone list, andrisk register)

F-F

S-S

S-F

Activity A Activity B

Activity C

Activity D

Activity E

F-S

6.4

Estimate Activity Resources

Planning: Time Management

PMBOK®

Fifth

Edition, Page

160



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Outputs

Activity resource

requirementsResource breakdownstructure

Project documents updates

Tools &

Techniques

Expert judgment

Alternative analysisPublished estimating dataBottom-up estimatingProject management software

Inputs

Schedule management planActivity list

Activity attributesResource calendarsRisk registerEnterprise environmental factorsOrganizational process assets

Page 89

6.3 Estimate Activity Resources

Estimate Activity Resources is the



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Estimate Activity Resources is theprocess of estimating the type and

quantities of material, humanresources, equipment or suppliesrequired 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

6.3.1 Estimate Activity ResourcesInputs



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• 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

6.3.1 Estimate Activity ResourcesInputs, Resource Calendars



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Resource calendars document the time periods when

each team member can work on the project. To do thiswe must have a good understanding of the person’s

schedule conflicts, including holiday time andcommitments to other projects. We document activeand idle time for each person over the life of the project

and show the results in a project histogram. Resourcesinclude people, material, equipment and facilities.

6.3.2 Estimate Activity ResourcesTools and Techniques



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• 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)

6.3.2 Estimate Activity ResourcesTools and Techniques



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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.


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

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.

6.3.3 Estimate Activity ResourcesOutputs



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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

6.5

Estimate Activity Durations

Planning: Time Management PMBOK® Fifth Edition, Page 166



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Outputs

Activity duration estimatesProject documents updates

Tools &

Techniques

Expert judgmentAnalogous estimating

Parametric 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

6.5 Estimate Activity Durations PMBOK® Fifth Edition, Page 166

Estimates may be obtained in the



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Estimates may be obtained in thefollowing ways:

• Expert judgment• Analogous estimating• Parametric estimating• Three-point estimates• Group decision-making

A contingency reserve (or timereserve, or buffer) may be used toaccount for schedule uncertainty

Page 93

6.5 Estimate Activity Durations

Definition: Estimating the number of work periods needed to complete



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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 of resources to be applied, and (3) number of work periods needed to finish

each activity.

Duration estimates are progressively elaborated.

Rolling Wave applies to duration estimating

Estimating duration includes elapsed time as well as work time.

Page 93

6.5.1 Estimate Activity DurationsInputs



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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

6.5.2 Estimate Activity DurationsTools and Techniques, Estimating Methods


169



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Analogous Time Estimating (a form of expert judgment):

Estimating the time to do tasks or to do a current project by extrapolatingfrom 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., activitymultiplied 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 theWBS time estimates to get a project total.

Task “A”


Est. HoursWho?

ExamTip

People doing the work create time & cost estimates

Reserve Analysis (Contingency):Project Teams can incorporate additionaltime into projects for schedule riskcontingency or buffer. Qual. (%) or Quant.(Monte Carlo)

6.5.2 Estimate Activity Durations PMBOK® Fifth Edition, Page 170

Tools and Techniques, Analysis Methods

Critical Path Method (CPM)



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• 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

Exam

Tip

Pessimistic - Optimistic

6

Pessimistic + Optimistic + (4 x Most Likely)

6te =


6

2Variance =

StandardDeviation =

Sometimes

called BetaDistribution

Sometimes

called Methodof Moments

6.5.2 Estimate Activity DurationsTools and Techniques, Duration Estimates

3-Point or



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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

PERT

Analysis

Exercise

Calculate the following values using PERT…



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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

6.6

Develop Schedule

Planning: Time Management

PMBOK®

Fifth

Edition, Page

172



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Outputs

Schedule baselineProject scheduleSchedule dataProject calendarsProject management plan

updatesProject documents updates

Tools &

Techniques

Schedule network analysisCritical path methodCritical chain method

Resource optimizationtechniques

Modeling techniquesLeads and lagsSchedule compressionScheduling tool

Inputs

Schedule management planActivity listActivity attributesProject schedule network diagrams

Activity resource requirementsResource calendarsActivity duration estimatesProject scope statementRisk registerProject staff assignmentsResource breakdown structureEnterprise environmental

factorsOrganizational process

assets

Page 101

6.6 Develop Schedule

Develop Schedule is the process of analyzing activity sequences, durations,



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resource requirements and schedule constraints to create the project schedule

A technique to generate theproject schedule employingvarious analytical

techniques such as criticalpath, critical chain, what-if

analysis and resourceoptimization

Schedule Network Analysis

A method used to estimate

minimum duration andflexibility in network paths.Calculates theoretical early

and late start and finishdates for all activities

without regard to resourcelimitations, using forward

and backward pass analysis

Critical Path Method

Allows the team to placebuffers on any network

path to account for limited

resources and durationuncertainties. The resource-constrained critical path isthe critical chain. A projectbuffer can be placed at the

end of the critical chain,and feeding buffers can be

places on non-critical legsthat feed into the critical

chain.

Critical Chain Method

Pages 103-105 & 110

6.6 Develop Schedule



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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

6.6.2 Develop ScheduleTools and

Techniques, Schedule Network Analysis

k l h h h h d l l



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• 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.


6

Pessimistic + Optimistic + (4 x Most Likely)6

te =


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.


Techniques, Critical Path Method (CPM)




CPM calculates early and late start and finish dates for activities using forward and

backward 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 may

be positive, negative, or zero. Total float provides schedule flexibility.

Critical paths have either zero or negative total float. The definition of “Critical

Path” is the longest addition of activity durations on a path from start to finish. It is

also 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 late

finish dates, or early and late start dates. Also known as slack, float, or project

float.

“Free Float” is the amount of time a schedule activity can be delayed withoutdelaying the early start date of its successor.

ExamTip

Slack Analysis

If you have a network with parallel paths and one leg has slack,h t th h d l d t k th l k t th d



PMP® Prep: PMBOK® 5th - 2013Page 103

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 days

Slack

12 days 16 days

9 days 13 days6 days

Slack

OR

When first laying out a schedule, put the slack at the end of

the shorter leg. It helps with resource leveling and recovery ifsomething happens to either of the two shorter legs duringexecution. Don’t schedule projects JIT.

JIT

Example of Critical Path Method©2013 PMI. A Guide to the Project Management Body of Knowledge (PMBOK

®

Guide), Fifth Edition



PMP® Prep: PMBOK® 5th - 2013

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

EarlyStart

EarlyFinishDuration

LateFinish

LateStart

TotalFloat

Legend

Critical PathNon-Critical Path

Path A, B, D = 25

Path A, C, D = 30

Page 105

6.6.2 Develop ScheduleCritical

Path MethodSupport

Sales Aids &Brochure

Production

1 Week

2 Weeks

2 Weeks 0 Week

3 Weeks

4 Weeks 0 Week




• The critical path is the longest addition ofdurations over a network.

• It is the shortest period of time the project canbe done.

• A project may have more than one critical path• The critical path may change as the projectprogresses

• Critical Path may be found using CPM, Three-Point, or Monte Carlo analyses.

Definition

Brochures

Margin

Stock

Profile

Training

Acceptance

Go/No Go

Decision Advertising

Training

DBT Stocking &Measuring Sys

Go/No Go

Launch

ProgramLaunch

Sales

1 Week 2 Weeks

4 Weeks

1 Week

5 Weeks

7 Weeks

1 Week

12 Weeks

Page 106

Calculate the Critical Path

2 32 days

1 5




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

5 Activity D

Activity C

1 day

0

0

9

95

5

3 5

6

7

Page 106 PMP® Prep: PMBOK 4® - 2013

Critical Path: Related termsEarly Start Date is the earliest date that uncompleted activities can be started given thenetwork logic and any schedule constraints




Early Finish Date is the earliest date that uncompleted activities can be finished giventhe network logic and any schedule constraints

Late Start Date is the latest date that an activity can begin without compromising aspecified 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 startdate without delaying the project finish date, or violating a schedule constraint. Alsoknow as float , slack , or project float

Free Float is the amount of time an activity can be delayed without delaying the earlystart of any following activities

Slack Time or Total Float = Late Finish Date - Early Finish Date, or Late Start - Early Start

Page 107

Calculating Critical Path and Float

TF = 14FF = 0

Critical Path (C-E-F) = 24Total Float in A-D-F = 14Total Float in B E F 9

------ = Backward Pass

------ = Forward Pass




A

B

C

D

E

F3

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

FF 0

TF = 14FF = 14

TF = 9

FF = 2

TF = 0FF = 0

Total Float in B-E-F = 9Free float: The

difference betweenearly start ofpredecessor and earlystart of successor,minus the estimatedtime 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)

Exercise

(1) Draw the network diagram and find the critical path…




Work

Package

Preceding

Activity

Estimate in

Months

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

(2) Find the slack of task A-F-B path, and of the D-E-G-H-Cpath from the answer above.

Answer: A-F-B = 15 Months, D-E-G-H-C = 1 Month

Page 109

Exercise: ADMThere may be 5-7 questions on network diagrams on the exam. Here is an example of aform of question that has a table of information and four questions that relate to it:




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 WeeksA: (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 6are nodes in the AOA or ADM Diagram). Critical Path = 15Weeks.

0

1

2

3

5

4

6

B = 9

A = 3

C = 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?

C i i l h i difi h h d l f li i d I i i ll


Techniques, Critical Chain Method




Critical chain modifies the schedule to account for limited resources. Initially

the critical path of a network is calculated using activity duration estimates.Then, resources are applied and the resulting schedule may be resource

limited. The critical chain method adds duration buffers that are non-work

activities. The planned activities are then scheduled to their latest start and

finish dates. Instead of managing total float, critical chain focuses on managing

the buffer durations and the resources applied to the planned activities.

Pages 110

Example of Critical Chain Method




Start Finish

Legend Critical Chain LinkNon-Critical Link

Activity C

Activity A

Activity G

Activity B

Activity D

FeedingBuffer

Feeding

Buffer

Activity E Activity FProjectBuffer

Pages 110


Techniques, Resource

Optimization: Leveling and Smoothing

Th hi t i ti h d di l f th t f



PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013Pages 111

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

A C

2 2 Duration in Days

Network Analysis

and Resource Leveling



PMP® Prep: PMBOK® 5th - 2013Page 112

Critical Path: A-D-F

andB-E-F

4 Days Slack

D

F

EB

Start Finish

4

2

3 3

2 3

1

1 1

2 Work Force RequiredWork Force AvailableEach Day: 4 People

A

D

FC

BE

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

A C

2 2

42 3

Network Analysis

and Resource Leveling




D

F

EB

Start Finish

4

23 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


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 adverse

conditions 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 for

analyzing the sensitivity of the project to changes and for addressing the impact of uncertainty in the network logic, duration of activities, and availability of resources.

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

If you can’t change the scope, there are two ways to meet schedule constraints:


Techniques, Schedule Compression




y g p , y

CrashingA technique used to shorten the schedule duration for the least

incremental cost by adding resources.

Page 114

ExamTip

Fast TrackingA technique where activities or phases normally done in sequence

are done in parallel for at least a portion of their duration. Fasttracking may result in rework and increased risk.

Exercise1. 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.




Task OriginalDuration

in months

CrashDuration

in months

TimeSavings

OriginalCost

in $

CrashCost

in $

ExtraCost

in $

ExtraCost in $

per mth

RiskImpact

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 LOWG 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

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

The Project Schedule may be presented in tabular form, however it’s more

6.6.3 Develop ScheduleOutputs

, Project Schedule




often presented graphically using milestone charts, bar charts or project

schedule 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

Page 117

6.6.3 Develop ScheduleOutputs

, Project Schedule

Example Schedules




Example: Milestone Chart

Example: Bar Chart, Gantt Chart

p

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 A7 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

, Nov 16, '97 Nov 23, '97 Nov 30, '97 Dec 7, '97 Dec 14, '97 Dec 21, '97

The Project Schedule

• May be represented by a Gantt chart, an activity networkdiagram, or a milestone chart




diagram, or a milestone chart

• Indicates the planned start and finish dates for each WBSelement

• May also indicate early start, late start, early finish, andlate finish dates for each activity

Definition

Brochures

Support

Margin

StockProfile

Training

Acceptance

Go/No Go

Decision Advertizing

Training

DBT Stocking &

Measuring Sys

Sales Aids &

Brochure

Production

Go/No Go

Launch

ProgramLaunch

Sales

Name Duration

Definition1w

Feasibility30d

Brochures1w

Margin2w

Stock Profile4w

Support2w

Training2w

Acceptance1w

Go/No Go Decision0d

Program Development35d

Sales Aids & Brochure3w

Advertising4w

Training 5w

DBT Stock & Measure7w

0d

Program Launch 1w

Sales 12w

Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7

Page 118

Practice Test #1




Turn to page 387 in the workbook

There are 60 questions.

You have 72 minutes to complete

Answers are on page 404

Page 387

Hint: Use scratch paper for answers,so you can reuse the questions for practice

7.1

Plan Cost Management

Planning: Cost Management

T l &


195




Outputs

Cost management plan

Tools &

Techniques

Expert judgment

Analytical techniquesMeetings

Inputs


Project charterEnterprise environmental factorsOrganizational process assets

Page 119

Plan

Cost ManagementPlan 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




This is a component of the project management plan.

Inputs

• Project Management PlanInformation to develop the Cost Management Plan:

• Scope baseline

• Schedule baseline

• Other information

• Project Charter(Provides a summary budget)

• EEF and OPA

Page 120

Plan

Cost ManagementTools and Techniques




• Expert Judgment• Analytical Techniques

(Choosing options to fund the project: self-funding,equity funding, or debt funding. Ways to financeresources: make, buy, rent, or lease. Policies mayinfluence: ROI, payback period, internal rate of return,

discounted cash flow, and net present value.)

• Meetings

Page 120

Plan

Cost ManagementOutputs

• Cost Management Plan




units of measure, level of precision,

level of accuracy (e.g., ±10%),

organizational procedures (the WBS is a frameworkfor cost estimating),

control threshold (% deviation from the baselineplan),

rules of performance measurement (EVM),

reporting formats (format and frequency of costreports),

process descriptions, strategic funding, exchange rate fluctuations, and

cost recording.

Page 121

7.2

Estimate Costs


Tools &


200




Outputs

Activity cost estimates

Basis of estimatesProject documents updates

Tools &

Techniques

Expert judgmentAnalogous estimatingParametric estimatingBottom-up estimatesThree-point estimates

Reserve analysisCost of qualityProject management

softwareVendor bid analysisGroup decision-

makingtechniques

Inputs

Cost management planHuman resource mgt. planScope baseline

Project scheduleRisk registerEnterprise environmental factorsOrganizational process assets

Page 122

7.2 Estimate Costs

Estimate Costs is the process ofdeveloping an approximation of the




monetary resources needed to complete

project activities.

Usually they are expressed in monetaryterms, although other units of measuresuch as person hours or staff days areoften used.

Costs include the resources to be chargedto the project which includes labor, butmay also include also materials,equipment and facility fees and services.

Both direct and indirect costs should beconsidered.

Page 123

7.2 Estimate Costs PMBOK® Fifth Edition, Page

201

Cost estimates are progressively elaborated during the course of the




Cost estimates are progressively elaborated during the course of the

project 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 narrow

to -5% to +10%.

7.2.2 Estimate CostsInputs

• Cost Management Plan



PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013Pages 123-125

(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 tocomplete the work)

• Risk Register(negative risks cause near-term costs to increase and project

schedules may be delayed)

• EEF and OPA

7.2.2 Estimate CostsInputs

• Should be determined per unit of use (e g hours meters kilos)




• 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.

Expert Judgment: consult with experts and obtain historical information.

A l E ti ti t d ti ti i il j t i th b i f ti t

7.2.2 Estimate CostsTools and

Techniques




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 currentproject 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

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.C

e=

o + 4m + p

6

Group Decision-Making Techniques: Delphi or nominal group techniques improve costaccuracy and the team commitment to cost estimates


Techniques

Analogous Cost Estimating (a form of expert judgment):Estimating cost of a current project by extrapolation from actual cost of




ExamTip

People doing the work create time & cost estimates

g p j y p

a 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 canestimate cost (number of drawings times cost per drawing, cost per lineof code, cost per square foot for types of construction).

Bottom-Up Estimating:

Rolling up the WBS estimates to get a project total.

Task “A”


Est. HoursWho?

Page 128


Techniques

o most optimistic cost estimate

3-PointAnalysis or




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 estimate

p = 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

y

PERT

Hours

AACE International Cost Classification Recommended Practices

Cl N E d U L l f P j A

7.2.3 Estimate CostsOutputs, Accuracy of Estimates




Class Name End Usage Level of Project Accuracy

Definition 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?)

ExamTip

These come up often on the exam, but are easy

to answer once you memorize the numbers.

Page 130

7.3

Determine Budget


OTools &

I

PMBOK®

Fifth

Edition, Page

208




Outputs

Cost baseline

Project funding requirementsProject documents updates

Tools &

Techniques

Cost aggregationReserve analysis

Expert judgmentHistorical relationshipsFunding limit reconciliation

Inputs

Cost management planScope baselineActivity cost estimatesBasis of estimates

Project scheduleResource calendarsRisk registerAgreementsOrganizational process assets

Page 131

7.3.1 Determine BudgetDetermine Budget is the process of aggregating estimated costs of individual activities orwork 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

7.3.2 Determine BudgetTools 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 whichspending must be reconciled. This might cause rescheduling and reallocation ofresources to regulate cash flow.

Historical Relationships: parametric analysis from historical sources can predict totalcosts. Math models are used.

ExamTip

Cost Baseline: a time-phased budget (either by period or cumulative overthe life of the project) used to measure, monitor and control project costs.

7.3.3 Determine BudgetOutputs, Cost

Baseline

, or Performance Measurement Baseline (PMB)




Time

Cost Cost Baseline

CumulativePlanned Value (PV)

Monthly PlannedValue (PV)

Spending Plans

and Cash FlowPlans are special

types of CostBaselines

the life of the project) used to measure, monitor and control project costs.

BAC

Page 134

ExamTip

Project Budget Components

ProjectBudget

ManagementReserve




CostBaseline

ControlAccounts

Contingency

Reserve

Work PackageCost Estimates

ActivityContingency Reserve

Activity CostEstimates

TotalAmount

Project Budget Component

©2013 PMI. A Guide to the Project Management Body of Knowledge (PMBOK® Guide), Fifth Edition

Page 135

7.3.3 Determine BudgetOutputs: Funding Requirements and Management Reserve




Time

Cost

Cost Baseline

Cumulative PlannedValue (PV)

Cash Flow

Funding

} ManagementReserve

Project Budget

BAC

Expenditures

ExamTip

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

Make a list of items that go into a Project Plan in the spaces provided below :

Exercise




Make a list of items that go into a Project Plan in the spaces provided below :

Exercise

Project Management Plan Estimate Costs




Collect requirements

Define Scope

Create WBS

Plan Schedule ManagementDefine Activities

Sequence Activities

Est. Activity Resources

Est. Activity Durations

Develop Schedule

Plan Cost Management

Determine BudgetPlan Quality

Develop HR Plan

Plan Communications

Plan Risk Management

Identify Risks

Perform Qual. Risk Analysis

Perform Quant. Risk Analysis

Plan Risk Responses


Plan Procurement

Plan Stakeholder Mgt.

Chapter 8: Project Quality ManagementPMBOK

Fifth

Edition, Page

227

Knowledge AreaQuality management processes include:




Quality is the degree to which a set of inherentcharacteristics fulfill requirements

Page 139

y g p

8.1 Plan Quality Management: The process of identifying quality requirements/standardsfor the project and its deliverables, and documenting how the project will demonstratecompliance.

8.2 Perform Quality Assurance: The process of auditing the quality requirements, andresults from quality control measurements, to ensure that appropriate qualitystandards and operational definitions are used.

8.3 Control Quality: The process of monitoring and recording results from executing qualityactivities to assess performance and recommend changes.

Quality management here is compatible with ISO (International Organization for Standardization) as well asShewhart, Deming, Juran, Crosby, FMEA (Failure Modes and Effects Analysis), Customer Satisfaction, TheVoice of the Customer, Prevention over Inspection, COQ (Cost of Quality), and Continuous Improvement(Total Quality Management, Six-Sigma, maturity models), and Management Responsibility.

Chapter 8: Project Quality Management

Quality vs.

Grade




Quality: The degree to which a set ofinherent characteristics fulfillrequirements.

Grade: Products that perform the samefunction but have different technicalcharacteristics.

A product may be high quality (no obvious defects)

but low grade (limited number of features)

Page 139

ExamTip

Chapter 8: Project Quality Management

Precision vs. Accuracy




ExamTip

Precision = Consistency.

Accuracy = Correctness.

Precision: repeated measurements have little scatter.

Accuracy: measured value is close to the true value.

Precision

Accuracy

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

8.1 Plan

Quality Management

Planning: Project Quality Management

OutputsTools &

Inputs




Outputs

Quality management planProcess improvement plan

Quality metricsQuality checklistsProject documents updates

Techniques

Cost-benefit analysisCost of quality (COQ)Seven basic quality toolsBenchmarkingDesign of experimentsStatistical samplingAdditional quality planning

toolsMeetings

Inputs

Project management planStakeholder registerRisk register

Requirements documentationEnterprise environmental factorsOrganizational process assets

Page 142

8.1 Plan Quality Management PMBOK® Fifth Edition, Page 231

Plan Quality is the process of identifyingquality requirements and/or standards




for the project and its deliverables, anddocumenting how the project willdemonstrate compliance.

The Quality Management Plan, which is

an output of this process, describes howthe project management team willimplement the quality policy and meetthe quality requirements.

Quality is planned, designed, and built into the project.It is not inspected in.

Page 142

8.1.1 Plan Quality ManagementInputs




• 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

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) scatterdiagrams.

Statistical Sampling: inspecting part of a batch to qualify the whole population.

Additional Quality Planning Tools: brainstorming, force field analysis, nominal grouptechnique, 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

8.1.2 Plan QualityTools 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

Exam

Tip

8.1.2 Plan QualityTools 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

8.1.2 Plan Quality ManagementTools and Techniques: Flowcharting

Cause & Effect, Ishikawa or Fishbone Diagrams

Not Following



PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013Page 145-146

EFFECTCAUSES

People

Lack of Training

MethodsMaterial

Transport IT System Procedure

Process Flowchart

Design Review

Revise

OK?Yes

Proceed

No

Not Following

Procedures

8.1.2 Plan Quality ManagementTools and Techniques:

Flowcharting, SIPOC Model

Suppliers Inputs Process Outputs Customers ____________ ____________ ____________ ____________ ____________ ____________ ____________ ____________ ____________ ____________ ____________ ____________ ____________ ____________ ____________




Supplier Process Customer

Input Output

Requirements andFeedback Loop

Requirements andFeedback Loop

Requirements List Measurements List Requirements List Measurements List

____________ _____________ _____________ _____________

____________ _____________ _____________ _____________ ____________ _____________ _____________ _____________


Page 145-146

8.1.2 Plan Quality ManagementTools and Techniques: Pareto Diagrams and Design of Experiments

e )




source

% c o n t r

i b u t i o n ( o r f r e q u e

n c y o f o c c u r r e n c e

Pareto’s Law:

80/20 Rule

80%?

Design of Experiments:

Which factors may influence

specific variables?

“What If” Analysis

A histogram shows central tendency, dispersion,


Histograms




A histogram shows central tendency, dispersion,and shape of a statistical distribution.

0.5

1.0

1.5

Page 147


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

DistributionCurve

ExpectedVariation

Out of Control(Assignable Cause)


Control

Chart

Upper Spec. Limit




Plan or Mean

UCL

LCL

Lower Spec. Limit

Upper Spec. Limit

Actual

Hours recorded for this projectstarted on plan, but if the trendcontinues, hours spent will driftout of control.


Scatter Diagram




Timecard Submission vs. Travel Days


Scatter Diagram




0 5 10 15 20 250

2

4

6

-2

-4

-6

Total Travel Days in the Month

S u b m i s s i o n D a y s , E

a r l y ( - ) , L a t e ( + )

o o o

o

o

o

o

o

o

o

o

o

o oo

o o

o

oo o o


Seven Basic Quality Tools



PMP® Prep: PMBOK® 5th - 2013PMP® Prep: PMBOK® 5th - 2013PMBOK® Fifth Edition, Page 239


8.1.2 Plan Quality ManagementTools and Techniques: Statistical Sampling

…a technique for accepting or rejecting a larger population

by choosing a part of the population for inspection ...




y g p p p p

• 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.

8.1.2 Plan Quality ManagementTools 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 into

groupings 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 of

weighing pros and cons. You can plan to strengthen the forces supporting a decision, and reduce the impact of opposition to it.

A nominal group technique is a structured process which identifies and ranks the major problems or issues that

need addressing.

8.1.2 Plan QualityTools and Techniques: Additional Quality Planning Tools, Group Creativity





considers 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 who

provide 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.

8.1.3 Plan Quality ManagementOutputs




• Quality Management Plan• Process Improvement Plan

(process boundaries, configuration, metrics, and targets forimproved performance)

• Quality Metrics

• Quality Checklists

• Project Documents Updates(stakeholder register, responsibility assignment matrix, WBS,WBS dictionary, etc.)

8.1.3 Plan Quality ManagementOutputs: Update Responsibility Assignment Matrix (RACI Chart)




R = Responsible

A = Accountable

C = Consulted

I = Informed

Chapter 9: Plan Human Resource ManagementPMBOK

Fifth

Edition, Page

255

Knowledge AreaProject Human Resource Management processes include:




Human resource management includes the processesthat organize, manage, and lead the project team

The project management team (core, executive, orleadership team) is a subset of the project team

and is responsible for leadership activities.

ExamTip

Page 155

9.1 Plan Human Resource Management: The process of identifying and documentingproject roles., responsibilities required skills, reporting relationships, and creating astaffing management plan.

9.2 Acquire Project Team: confirming HR availability and obtaining the team to completeproject activities.

9.3 Develop Project Team: improving competencies, team members interaction, and teamenvironment to enhance performance.

9.4 Manage Project Team: tracking team member performance, providing feedback,resolving issues, and managing change to enhance project performance.

9.1

Plan

Human Resource

Management

Planning: Human Resource Management

Outputs

Tools &

Inputs

PMBOK

Fifth

Edition, Page

258




Human resource managementplan

Techniques

Organization charts andposition descriptions

NetworkingOrganizational theoryExpert judgmentMeetings

Project management planActivity resource requirementsEnterprise environmental factorsOrganizational process assets

Page 156

9.1 Plan Human Resource ManagementPMBOK® Fifth Edition, Page 258

Plan Human Resource Management is the




process of identifying and documentingproject roles, responsibilities, required skillsand reporting relationships and creating astaffing management plan

Page 156

9.1.2

Plan Human Resource ManagementTools 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

BankingProtocols

Customer

Services(TM #1)

Information

Tech. and IS(TM #2)

Operations(TM #3)

Regulatory(TM #4)

System Design(TM #22)

SystemDevelopment

(TM #23)

Legal(TM #41)

Filing &Documentation

(TM #42)

AccountingRelations(TM #61)

Global Trans.Services(TM #51)

CashManagement

(TM #52)Audit &

Inspection(TM #53)

System Analysis(TM #21)

ProductPlanning(TM #11)

Treasury(TM #5)

Project

Management(PM)

Training(TM #31)

Sales(TM #12)

IntegrationProtocols

(TM #32)

StrategicPlanning

(TM #62)

9.1.2


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.

9.1.2


Organizational Breakdown Structure

ProjectCost Accounts provide a




Design Production

Comp. #2Comp. #1Comp. #2Comp. #1

C o m p a n y

E n g i n e e r i n g

M a n u f a c t u r i n g

A s s e m b l y

P a r t s

E l e

c t r i c a l

M e c h a n i c a l

Cost

Account

Cost

Account

Cost

Account

Cost

Account

Cost

Account

Cost

Account

Cost

Account

Cost

Account

way to control howfunctional organizationsto charge to projects.

WBS Codes showfunctional managersexactly what their

people are doing onthe project.

9.1.2


Matrix Charts

Responsibility Assignment Matrix (RAM)




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.

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 AdviseScale Up Advise Advise Lead Support Support

Production Advise Advise Advise Lead Support

Assembly Advise Advise Advise Support Lead

D a v e

M a r y

G a v

i n

B o

b

T o m

R = Responsible

A = Accountable

C = Consulted

I = Informed

9.1.2


Text

-

Oriented Forms

i i i i




Position Descriptionsshow team memberresponsibilities,authority,competencies, andqualifications

outlined in a textdocument. These canbe used forPerformance

Evaluations

9.1.3

Plan Human Resource ManagementOutputs




Human Resource Management Planroles and responsibilities, project organization charts,staffing management plan:

Staff Acquisition

Resource Calendars

Staff Release Plan Training Needs

Recognition and Rewards

Compliance

Safety.

9.1.2 Develop Human Resource PlanOutputs: 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

Chapter 10: Project Communications ManagementPMBOK

Fifth

Edition, Page

287

Knowledge Area

P j C i i M i l d




Project Communications Management includes the processesrequired 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 onstakeholder’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 controllingcommunications throughout the entire project life cycle to ensureinformation needs of stakeholders are met.

10.2 Plan

Communications Management

Planning: Project Communications Management

OutputsTools &

T h i

Inputs




Communications

management planProject documents updates

Techniques

Communication requirementsanalysis

Communication technology

Communication modelsCommunication methodsMeetings

Project management planStakeholder register

Enterprise environmental factorsOrganizational process assets

Page 165

10.2 Plan Communications ManagementPMBOK® Fifth Edition, Page 289

Communications Management is soimportant that it is sometimes included

l




as a major WBS element

Page 165

Study Concept Prototype Qualification

TypicalProject

Pilot Production ProjectManagement &

CommunicationsPlan

10.2.2

Plan Communications ManagementTools and Techniques

Communications Requirements Analysis

Consider the following information as you plan your project

communications




Communication Technology

Pages 166-167

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 theavailable 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 virtualenvironment

• Sensitivity and confidentiality of the information.

10.2

Plan Communications Management

Plan Communications is the process of

d t i i th j t t k h ld i f ti





determining the project stakeholder informationneeds 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 isthe number of people in the group

Page 166-167

10.2.2

Plan Communications Management

Try it ….





If a project team of 5 people adds onemore person to the team, how many more

channels of Communication are there?

5 more

Page 167

10.2.2

Plan Communications ManagementTools and Techniques: Communication Models

Thinking

Sending

The basic model of communication is thesend-receive model which includes:• Encoding (translating ideas to language),• Transmit Message (transmitting),• Medium (methods used to transmit)

• Noise (disruptions) and




Articulating

Hearing

Listening

Transmitting

Thinking

Receiving

Feedback !!

• Noise (disruptions), and• Decoding (translate for receiver)• Acknowledge (receipt of message)• Feedback (back to sender).

10.2.3

Plan Communications ManagementOutputs: Communications Management Plan

The

Communications Management Plan usually provides:




• Stakeholder communication requirements• Information to be distributed• Reason for the distribution• Time frame and frequency• Communication responsibilities

10.2.3 Plan CommunicationsOutputs: Communications Management Plan

documents a

communication strategy for the project and describes:

St k h ld i ti i t




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)

Chapter 11: Project Risk ManagementPMBOK

Fifth

Edition, Page

309

Knowledge Area

Project Risk Management processes include:




Project risk management includes the processes ofconducting risk planning, identification, analysis, response

planning, and monitoring and control on a project.

Page 171

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 onobjectives,

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.

Chapter 11: Project Risk Management• Project risk includes both threats to the project’s objectives

(negative outcomes) and opportunities to improve on thoseobjectives (positive outcomes) - PMBOK® Fifth Edition, page 310.

• Uncertainty: An uncommon state of nature characterized by




• Uncertainty: An uncommon state of nature, characterized byabsence of information related to a desired outcome.

• Risk Management: The process of identifying, analyzing andresponding to risk - maximizing positive events and minimizingconsequences of negative events.

• Risk arises throughout a project and must be identified andevaluated 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


Planning: Project Risk Management

OutputsTools &

Techniques

Inputs

PMBOK®

Fifth

Edition, Page

313




Risk management plan

Techniques

Analytical techniques


Project management planProject charter

Stakeholder registerEnterprise environmental factorsOrganizational process assets

Page 173

11.1 Plan Risk ManagementPlan

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




11.1.1 Plan Risk ManagementInputs

• Project Management Planprovides current state of risk affected areas including




11.1.2 Tools and Techniques: Analytical Techniques, Expert Judgment, and Meetings

Pages 174-175

provides current state of risk-affected areas includingscope, schedule, and cost

• Project Charterhigh-level requirements

• Stakeholder Register• EEF and OPA

11.1.3 Plan Risk ManagementOutputs

Risk

Management

Plan, includes

:

• Methodology: Approaches tools and data sources




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

11.2 Identify Risks


OutputsTools &

Techniques

Inputs

PMBOK®

Fifth

Edition, Page

319




Risk register

Techniques

Documentation reviewsInformation gathering

techniquesChecklist analysis

Assumptions analysisDiagramming techniquesSWOT analysisExpert judgment

Risk management planCost management planSchedule management planQuality management planHuman resource mgt. plan

Scope baselineActivity cost estimatesActivity duration estimatesStakeholder registerProject documentsProcurement docs.

EEFOPA

Page 177

11.2 Identify Risks

Identify Risks is the processof determining which risksmay affect the project anddocumenting their




documenting theircharacteristics .

All project personnel shouldbe encouraged to identify

potential risks

Page 177

11.2.1 Identify RisksInputs

• Risk Management Plan

provides risk responsibilities risk breakdown structure




provides 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

11.2.2 Identify RisksTools and Techniques: Information Gathering Techniques


considers all possible options/solutions without judgment before proceedingt iti l l ti f th j t/ d t i t




considers all possible options/solutions without judgment before proceedingto critical evaluation of the project/product requirements.

Delphi Technique: questionnaires are sent to a group of experts who provideanswers and are kept anonymous. Responses are compiled, prioritized, andsent back for another round of requirements gathering. A method forbuilding consensus.

Interviewing: experienced stakeholders and SME can identify risks

Root Cause Analysis: Cause and Effect analysis to find causes and develop

prevention actions.

11.2.2 Identify RisksTools and Techniques:

Checklist Analysis

Checklist Analysis:

Risk identification checklists are developed from previous




Risk identification checklists are developed from previousprojects 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 incorporatenew lessons learned.

Page 180

11.2.2 Identify RisksTools and Techniques: Assumption Analysis

Assumption: a factor in the planning process considered to betrue real or certain without proof or demonstration:




Assumption Analysis: explores the accuracy ofassumptions and identifies risks to the projectfrom inaccuracy, inconsistency, or incompleteness,

Assumptions involve risk -- identify the risk!

true, real, or certain, without proof or demonstration:

• resource, equipment, and facilities availability• external timelines• technology compatibility

• interpretation of legal and regulatory constraints

11.2.2 Identify RisksTools and Techniques: Diagramming Techniques


Not FollowingP d




EFFECTCAUSES

People

Lack of Training

MethodsMaterial


Procedures


An

Influence

Diagram is a visual representation of situationsshowing causal influences, time ordering of events, or other

relationships among variables.




relationships 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.


Influence Diagram




Influence Diagram

ProjectEstimates

RiskCondition

ProjectActivity

Deliverables


Page 181

11.2.3 Identify RisksOutputs: Risk Register

Risk Register




Risk Registera document where results of risk analysis and riskresponse 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

11.3 Perform Qualitative Risk Analysis


OutputsTools &

TechniquesInputs

PMBOK®

Fifth

Edition, Page

328





Risk probability and impactassessment

Probability and impact matrix

Risk data quality assessmentRisk categorizationRisk urgency assessmentExpert judgment

Risk management planScope baseline

Risk registerEnterprise environmental factorsOrganizational process assets

Page 183

11.3 Perform Qualitative Risk Analysis

Perform Qualitative Risk Analysis

is the process of prioritizing risks forfurther analysis or action by assessingor combining their probability of




or combining their probability ofoccurrence and impact.

The Perform Qualitative Risk Analysisassesses priority of identified risks

using “probability/Impact” or“likelihood of occurrence/severity”

analysis to determine impact onproject objectives if the risks occur.

Page 183

Probability

Impact

11.3.1 Perform Qualitative Risk AnalysisInputs

•Risk Management Planprovides risk responsibilities budget/schedule P/I matrix




provides risk responsibilities, budget/schedule, P/I matrix,stakeholder risk tolerance, etc.


• Risk Register

• EEF and OPA

11.3.2 Perform Qualitative Risk AnalysisTools and

Techniques, Risk P/I Assessment

Risk Probability and Impact Assessment

• Probability is the likelihood that a risk event will occur.




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 bemanaged aggressively, or must be mitigated.

• Risks with low P/I ratings will be included on a watch list.

11.3.2 Perform Qualitative Risk AnalysisTools and

Techniques, Probability and Impact Matrix

Risk Probability and Impact Matrix

• The risk matrix is one of the simplest and most effective tools




The risk matrix is one of the simplest and most effective toolsto analyze risk. It has probability (likelihood) on one axis andimpact (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.

11.3.2 Perform Qualitative Risk AnalysisTools and Techniques: P/I Matrix

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.

Probability Threats OpportunitiesExam





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

y pp

Impact (ratio scale) on an Objective

ExamTip

11.3.2 Perform Qualitative Risk AnalysisTools and Techniques: Risk Matrix

Unacceptable

Risk Legend




HighMediumLow

Likelihood (Probability)

Low

High

Medium

Managed

Controlled

Identified, nocontingent plan

Must Mitigate

11.3.2 Perform Qualitative Risk AnalysisTools and Techniques:

Industry Guidelines




11.3.3 Perform Qualitative Risk AnalysisOutputs:






j p Risk register

• Assessments of P/I for each risk

• Risk ranking

• Risk categorization

• Watch list for low probability risks Assumptions log updates

11.4 Perform Quantitative Risk Analysis


OutputsTools & TechniquesInputs

PMBOK®

Fifth

Edition, Page

333





Data gathering andrepresentation techniques

Quantitative risk analysis andmodeling techniques

Expert judgment

Risk management planCost management planSchedule management plan

Risk registerEnterprise environmental factorsOrganizational process assets

Page 188


Perform Quantitative Risk Analysis

is the process of numerically analyzing the

effect of identified risks on overall project




objectives.

Perform Quantitative Analysis is used onrisks that have been prioritized by

qualitative analysis as substantiallyimpacting project objectives.

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.

Q tit ti Ri k t h i lik Monte Carlo Simulation




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.

11.4.2 Perform Quantitative Risk AnalysisTools and Techniques:

Data Gathering and Representation Techniques

Risk Interview

WBS Element Optimistic PessimisticMost Likely




Build

Test

Total Project

Design $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.


11.4.2 Perform Quantitative Risk AnalysisTools and Techniques: Data Gathering and Representation Techniques

o = most optimistic cost estimate

p = most pessimistic cost estimatem = most likely cost estimate

3-PointAnalysis or

PERT

Probability Distributions




Beta Distribution

60 5 hours with 68% confidence60 10 hours with 95.5% confidence60 20 hours with 99.7% confidence

ost e y cost est ate

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 Hours

11.4.2 Perform Quantitative Risk AnalysisTools 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 display

of sensitivity is the tornado diagram, which compares the importance of variables having highuncertainty to those that are more stable.




uncertainty 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, when

evaluating alternatives during project selection, EMV that is most positive (the higher number) isprobably the best outcome. However, when alternative risks are evaluated, perhaps the lower

number (minimum risk) is best.

Decision Tree Analysis

Decision Tree Analysis is a common use of EMV analysis. It incorporates the cost of each available

choice, 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.


Sensitivity Analysis: Tornado Diagram

Low High

Uncertainty

Uncertaintyat baseValues




V a r i a b l e s

What is a Tornado Diagram?

The purpose of sensitivity analysis is toidentify which uncertainty variables havethe greatest impact on total value.Why create a Tornado Diagram?

The tornado diagram helps identify

uncertainties with the highest economicimpact. (Risk-Adjusted NPV). 80% of thetotal uncertainty can be discovered by usingthe top 5-8 variables in the tornado diagram

(+) Positive Impact(-) Negative Impact

Risk 1

Risk 2

Risk 3

Risk 4

Risk 5


Expected Monetary Value (EMV)

$ 12,000




$ 10,000

$ 10,200

$ 8,000

$ 12,000

$ 10,000

Select “B” for lowest Risk

A

Decision Tree : a common use of

EMV analysis

Flagship store in

Increased shopper

traffic(+$100,000)

0.6

Exercise

Answer:




New store orrenovation?

new mall(-$1,000,000) Stronger

competition(-$50,000)

Renovate existingstore

(-$250,000) Dwindling shopper

traffic(-$100,000)

Initial businesssurge

(+$50,000)

0.4

0.8

0.2

-$960,000

-$230,000

Page 192

EMV is the second most-tested topic on theexam after “the process of risk management”

ExamTip

1. Test yourself :You are planning modifications to a product line Below is the

Exercise




You are planning modifications to a product line. Below is thecomplete assessment of risks on the project Calculate the EMV ofyour 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.

-

+

- - $13,375

+

-

2. Test yourself on a decision tree:

What is the EMV of A and B?

Exercise




A

B

Answer: $42K+$6K = $48K


Modeling and Simulation

Monte Carlo Simulation

The most common simulation technique is Monte Carlo simulation.




qEarlier 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.


Modeling and Simulation

Uses the network diagram (PDM) and Three-Point Estimates as models toi l t h d l i t th j t d th WBS it d l i





simulate schedule impacts on the project, and the WBS as its model usingThree-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 riskwhere 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.

7 5 %

1 0 0 %

Mean = $46M

Total Project Cost (cumulative)

11.4.2 Perform Quantitative Risk Analysis

Tools and Techniques: Quantitative Risk Analysis and Modeling Techniques

Modeling and

Simulation, Cost Risk Simulation




Cost

$30 M $38M $47M $56M $65M

P r o b a b i l i t y

0 %

2 5 %

5 0 %

$50M$41M

The project is only 12% likely to meet the 41 million “most likely”

cost estimate. If the organization wants 75% chance of success, $50million is required (at contingency of 22%, [$50M-41M)/$41M]).

12%

Page 194

11.4.2 Perform Quantitative Risk Analysis


Road Closed

R i t

30% Mean Probabilityof Project Failure

Tools and Techniques: Quantitative Risk Analysis and Modeling Techniques

Modeling and

Simulation




0 .25 .5 .75 1.0

Running outof Gas

Getting Stuckin Snow Drift

0 .25 .5 .75 1.0

Monte Carlo Simulation,Overall Project Risk

5% Chance ThatProbability is 75%

11.4.2 Perform Quantitative Risk AnalysisOutputs: Project Documents Updates

Risk Register Updates include: Probability analysis of the project




Probability analysis of the project

• confidence levels and distributions are used to calculate costand time reserves.

Probability of achieving cost and time objectives

Priority list of quantified risks Trends in risk analysis results

11.5 Plan Risk Responses


OutputsTools &

TechniquesInputs

PMBOK®

Fifth

Edition, Page

342




Project management planupdates


Strategies for negative risksor threats

Strategies for positive risksor opportunities

Contingent responsestrategies

Expert judgment

Risk management plan

Risk register

Page 196

11.5 Plan Risk Responses

Plan Risk Responses is the process of

developing options and actions toenhance opportunities and to reduce




threats to project objectives

Page 196

11.5.2 Plan Risk ResponsesTools and Techniques: Strategies for

Threats

or Opportunities

• Avoid

Eliminate the threat by eliminating the cause.

• Transfer

Contract the risk out. Transfer it to a third party with incentives, penalties,warranties, bonding, .. , purchase insurance.

NegativeRisk orTh t




• Mitigate

Effect the probability and/or the impact of the risk.

• Exploit

Eliminate uncertainty of upside risk to ensure opportunity happens

• ShareThird party helps to capture the opportunity

• Enhance

Opposite of Mitigation. Proactively target and reinforce the trigger toachieve a positive opportunity.

• Acceptance

Know about the risk, but decide to accept the consequences if failure

occurs.

Threats

PositiveRisk orOpportunities

Both

ExamTip

Pages 197-199

• Knowledge and Research

Perform tests & simulations. Consult experts. Start risk tasks asearly as possible within available slack.

11.5.3 Plan Risk ResponsesOutputs: Contingency Reserve, Part of the Risk Register

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 problems




y p pMay 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%

11.5.3 Plan Risk ResponsesOutputs:


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

Chapter 12: Project Procurement ManagementPMBOK

Fifth

Edition, Page

355

Knowledge Area

12.1 Plan Procurement Management: Documenting purchase decisions,specifying the approach, and identifying potential sellers.




Plan Procurement Management includes the processes necessary to purchase

or acquire products, services, or results needed from outside the projectteam. It includes contract management and change control processes, as well

as administering contracts and obligations under the contracts.

12,2 Conduct Procurements: Obtaining seller responses, selecting aseller, and awarding a contract.

12.3 Administer Procurements: Managing procurement relationships,

monitoring contract performance, and making changes andcorrections as needed.

12.4 Close Procurements: Competing each project procurement.

Chapter 12: Project Procurement Management

Procurement Process




Make orBuy

RFP/RFQIssued

ProposalReceived

ContractAward

SubstantiveCompletion

Q&A

PlanPurchases &Acquisitions

PlanContracting

RequestSeller

Responses

SelectSellers

ContractAdministration

ContractClosure

12.1 Plan Procurements

Planning: Plan Procurement Management

Outputs

Tools &Techniques

Inputs





Procurement managementplan

Procurement statement ofwork

Procurement documentsSource selection criteriaMake-or-buy decisionsChange requestsProject documents updates

Make-or-buy analysisExpert judgment

Market researchMeetings

Project management planRequirements documentationRisk registerActivity resource requirementsProject schedule

Activity cost estimatesStakeholder registerEnterprise environmental

factorsOrganizational process

assets

Page 203

12.1 Plan Procurement Management

Plan Procurement Management is the

process of documenting projectpurchasing decisions, specifying the

PMBOK®

Fifth

Edition, Page

358




p g , p y gapproach and identifying potentialsellers.

The plan procurements process involvesdeciding whether to “make-or-buy”, the

consideration of potential sellers, andthe consideration of the risks involved

Page 202

12.1.2

Plan Procurement ManagementInputs: Organizational Process Assets




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.

Page 204-206

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 PriceAdjustment (FP EPA)




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

12.1.2


Fixed Price (or Lump Sum) Type Contracts:

Used on well specified projects for which costs can be accuratelyestimated Cost risk is on the supplier (includes FFP FPIF FP-EPA)




Cost Reimbursable Type Contracts:

Time & Materials Type Contracts:

Used on development projects for flexibility. Cost risk is on the buyer, soestablish administrative & reporting systems to allow both buyer and sellervisibility into costs. (Includes CPFF, CPIF, CPAF)

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, orlabor hours and associated material costs – includes overhead and burden)

ExamTip

12.1.2


FFP

FPEPA

FPAF

Client, Customer

or Buyer

100% 0%

On the exam contract

Inputs: Organizational Process Assets




FPAF

FPIS

FPIF

CPIF

CPAF

CS

CPFF

COSTContractoror Seller

0% 100%

RISK

On the exam, contractquestions are written

from the buyer’s

perspective

RISK

FFP

FPEPA

FPAF

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 judgmentof the quality of the contractor's performance.

Fi d P i I i (S i T ) d ( )

US Federal Acquisition Regulations (FAR 16.104)

12.1.2 Plan Procurements Inputs: OPA




FPIS

FPIF

CPIF

CPAF

CS

CPFF

COST

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 commercialbenefit which they accept in lieu of fee.

Cost: Typically for R&D with nonprofit organizations, educational institutions,

and facilities contracts.

12.1.2

Plan Procurement ManagementTools and Techniques: Budget Implications




12.1.2

Plan Procurement ManagementTools and Techniques: Profit or Fees for Different Contracts




12.1.2

Plan Procurement ManagementTools and Techniques: Point of Total Assumption

Exam

Tip

Is on the exam




Cost Plus Incentive Fee Calculation

Incentive Fee Calculation

Exercise

You may have to calculate both the Fee and the Final Price for the Exam!




Target cost $210,000

Target fee $ 25,000

Target price $235,000

Sharing ratio 80/20 Actual 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

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 legalexperts 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 otherless mature technologies.

Page 206

MeetingsInformation exchange with potential bidders can benefit the project.

12.1.3

Plan Procurement ManagementOutputs: Procurement Management Plan, and

Procurement

Statement of Work

• Provides the basis of agreement between buyer and supplier

• Sufficient detail to allow prospective suppliers to determine

A narrative description of products or services to be supplied under contract.




Sufficient detail to allow prospective suppliers to determinewhether 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!

12.1.3

Plan Procurement ManagementOutputs: Procurement Documents

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 Plan




from 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

Understandingof need

Life-cycle cost Technicalcapability

Risk Managementapproach

Examples of source selection

criteria are:

12.1.3

Plan Procurement ManagementOutputs: Source Selection Criteria




Technicalapproach

Warranty Financialstability

Productioncapacity

Business sizeand type

Pastperformance

of sellers

References Intellectualproperty rights

Proprietaryrights

• 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

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 formallycontrolled

• The US Government backs all contracts byproviding a court system (this is a US exam)

Page 213

13.2 Plan Stakeholder Management

Planning: Project Stakeholder Management

Outputs

Tools &Techniques

Inputs

PMBOK

® Fifth Edition, Section

13.2,

Page 393




Stakeholder managementplan



Analytical techniques

Project management planStakeholder register


Page 314

13.2 Plan Stakeholder Management

Plan Stakeholder Management is the

process of developing managementstrategies to engage stakeholdersthroughout the project life cycle,




throughout the project life cycle,based on the analysis of their needs,interests, and impact on projectsuccess.

It allows the project manager thedevelop ways to engage stakeholdersin the project, to manage theirexpectations, and to achieve theproject objectives.

Page 214

13.2 Plan Stakeholder ManagementTools and Techniques

: Analytical Techniques

Engagement level of the stakeholders can be classified as follows:

• Unaware of project and potential impacts

Engagement Level of Stakeholders




• 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 inensuring success.

13.2 Plan Stakeholder ManagementTools and Techniques

: Analytical Techniques

Stakeholder Engagement Assessment Matrix

Stakeholder LeadingSupportiveNeutralResistantUnaware




ExamTip

Stakeholder 1

Stakeholder 2

Stakeholder 3

C

C

D

D

D C

Legend: “C” = Current Engagement

“D” = Desired Engagement


13.2 Plan Stakeholder ManagementOutputs: 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 theproject progresses.

Executing Process GroupPMBOK® Fifth Edition, Page 79




Process Groups

Knowledge Areas

Initiating Planning Executing ClosingMonitoring &

Controlling4. Project Integration

Management4.2 Develop Project

Management Plan4.3 Direct & Manage 4.4 Mon/Ctrl Proj Work

4.5 Perform IntegratedChange Control


5.1


Define Scope

5.5 Validate Scope

5.6 Control Scope


6.1

Define Activities6.2

Sequence Activities6.3Est. Activity ResourcesEst. Activity Durations6.5Dev. Schedule



5.4 Create WBS

6.4

4.6 Close Project

or Phase

Plan Scope Mgt.

5.3

Plan Schedule Mgt.

6.6


Executing

4.3 Direct and Manage Project

Work8.2 Perform Quality Assurance9.2 Acquire Project Team





7.2 Estimate Costs


7.4 Control Costs





9.1 Plan Human








11.2 Identify Risks




11.6 Control Risks



13.1 Identify Stakeholders 13.3 Manage Stakeholder

Engagement


Engagement

7.1 Plan Cost Mgt.




Management

9. Acquire Project Team9.3 Develop Project Team9.4 Manage Project Team10.2 Manage Communications

12.2 Conduct Procurements13.3 Manage Stakeholder

Engagement

4.3 Direct and Manage Project

Work

Executing: Integration Management

OutputsTools &

TechniquesInputs

PMBOK®

Fifth

Edition, Page

79




DeliverablesWork performance dataChange requests

Project management planupdatesProject documents updates

Expert judgmentProject management

information systemMeetings

Project management planApproved change requests


Page 220


Direct and Manage Project Work

is the process of leading and performing

the work defined in the projectmanagement plan and implementing




approved changes to achieve the

project’s objectives

Page 220

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,





, q p , ,• 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

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

4.3.1 Direct and Manage Project Work

Plan Scope Management Determine Budget




Plan Scope Management Collect Requirements Define Scope Create WBS Plan Schedule Management Define Activities Sequence Activities Estimate Activity Resources Estimate Activity Durations


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


4.3.2 Direct and Manage Project WorkTools and Techniques

Expertise is provided by the project manager and the PM team, andadditional knowledge can be gained from a variety of sources inside

and outside of the organization.

PM Information System (PMIS)

Expert Judgment




f y ( )

The PMIS provides access to tools: scheduling tool, work authorization system,configuration management system, information collection/distribution system, reportingon key performance indicators (KPI), and interfaces to online automated systems.

Meetings

Meetings can include information exchange, brainstorming, option evaluation, or

decision making. Meetings are most effective when face-to-face. Virtual meetings (audioor video-conferencing) require additional preparation and organization to be as effectiveas face-to-face.

4.3.3 Direct and Manage Project WorkOutputs

Deliverables

Any product, result or service identified in the PM Plan produced during project execution.

Work Performance Information

Status of project activities is routinely collected. It includes schedule progress, deliverablestatus quality requirements met costs incurred estimates to complete lessons learned




status, quality requirements met, costs incurred, estimates to complete, lessons learned,and resources used.

Change Requests

Changes 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 Updates

Requirements, schedule, cost, quality, HR, communications, risk, procurement, and theproject baselines.

Project Document Updates: requirements, logs, risk register, and stakeholder register.

8.2 Perform Quality Assurance

Executing: Quality Management

Outputs

Tools &Techniques

Inputs

PMBOK®

Fifth

Edition, Page

242




Change requestsProject management plan

updates

Project document updatesOrganizational process assetsupdates

Quality management andControl tools

Quality auditsProcess analysis

Quality management planProcess Improvement planQuality metrics

Quality control measurementsProject documents

Page 224

8.2 Perform Quality Assurance

Perform

Quality

Assurance isthe process of auditing the

quality requirements and theresults from quality control




measurements to ensureappropriate quality standardsand operational definitions

are used

Page 224

8.2.2 Perform Quality AssuranceTools and Techniques: Quality

Management and Control Tools

• Flowcharting• Brainstorming

• Benefit/Cost Analysis• Cost of Quality (COQ)

l h

The Tools for Quality Planning should be used for Quality Assurance




• Force Field Analysis• Nominal Group Techniques• Matrix Diagrams

• Priority Matrixes

• Control Charts• Benchmarking• Design of Experiments (DOE)

• Statistical Sampling• Proprietary Methods

8.2.2 Perform Quality Assurance

• Prioritization Matrices• Activity Network Diagrams

• Affinity Diagrams• Process Decision Program

Ch ( C)

In Addition, Use the Seven Quality Management and Control Tools

Tools and Techniques: Quality

Management and Control Tools




• Matrix DiagramsCharts (PDPC)• Interrelationship Digraphs• Tree Diagrams

The Seven Quality Management and Control Tools

Affinity Diagram PDPC Interrelationship Digraph

Tree Diagrams Prioritization Matrices

No Yes YesNo No No

Network Diagrams




Tree Diagrams Prioritization Matrices

Matrix Diagrams

Start Finish

A B C

D E F

1Start Finish

BC

D

E

F

2

4 5

3

6

F

PDM

ADM

Network Diagrams

8.2.2 Perform Quality Assurance

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 and

operational definitions are used..

Quality assurance involves Quality Audits, and is done in Execution Processes.




Quality Control (QC): a process of monitoring and recording results (both product

and project management ) of executing quality activities to assess performance and

to recommend necessary changes. Involves identifying ways to remove the causes of quality 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.

y Q y ,

8.2.1 Perform Quality AssuranceTools 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

Q lit dit b f d i t ll t ll




• 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.

Practice Test #2




Turn to page 416 in the workbookThere are 68 questions.

You have 81 minutes to completeAnswers are on page 433

Page 416


9.2 Acquire Project Team

Executing: Human Resource Management

OutputsTools &

TechniquesInputs

PMBOK®

Fifth

Edition, Page

267




Project staff assignmentsResource calendarsProject management plan

updates

Pre-assignmentNegotiationAcquisition

Virtual teamsMulti-criteria decisionanalysis

Human resources managementplan

Enterprise environmental factorsOrganization process assets

Page 230

9.2 Acquire Project Team

Acquire Project Team is the process ofconfirming human resource availability

and obtaining the team necessary tocomplete project activities




9.2.1 Acquire Project TeamInputs: Project Management Plan, that includes:

• Human Resource Management Plan

defining positions, skills, and competencies

project organization charts




when team members are needed

• EEF and OPA

9.2.2 Acquire Project TeamTools and Techniques

Pre

-

Assignment

Project team members are selected in advance, perhaps where the project is part ofa proposal

The project manager should effectively negotiate and influence others whoare in a position to provide the required human resources for the project




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 ofgeographic or mobility limitations. Communication planning becomes increasingly

important in a virtual team environment

Pages 232-233

9.2.2 Acquire Project TeamTools and Techniques

Multi

-

Criteria Decision Analysis

Criteria are used to rate potential team members. The criteria are weighted byconsidering 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?




• 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?

9.3 Develop Project Team


OutputsTools &

Techniques

Interpersonal skills

Inputs

PMBOK®

Fifth

Edition, Page

273




Team performanceassessments

Enterprise environmentalfactors updates

pTrainingTeam-building activitiesGround rules

Co-locationRecognition and rewardsPersonnel assessment tools

Human resource managementplan

Project staff assignmentsResource calendars

Page 235

9.3 Develop Project Team

Develop Project Team is the process of

improving the competencies, teaminteraction and the overall teamenvironment to enhance project




environment to enhance projectperformance.Teamwork is a critical factor for project

success, and developing effective projectteams is one of the primary responsibilities

of the project manager

Page 235

ExamTip

Interpersonal Skills:

“soft skills”

Training:

activities designed to improve competencies of the

9.3.2 Develop Project TeamTools and Techniques:




project team members

Team-Building Activities:

should be designed to help individual team memberswork together effectively and establish good workingrelationships.

Pages 236-237

9.3.2 Develop Project TeamTools 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




Sto g ea add esses p oject a d et odo ogy a d ust

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.


The proper use of most project management tools & techniquescontribute 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

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 theircommitment to the rules

Co

-

location: Physically locating team members in the same

9.3.2 Develop Project TeamOther Tools

and

Techniques




y y g

physical location enhances team communication andperformance

Recognition and Rewards: Promote and reinforce desired

behaviors, and only desired behavior should berewarded.

“What gets measured, gets done”

Page 239

9.3.2 Develop Project TeamTools and Techniques: Recognition and Rewards

ExamTip

Herzberg’s

Motivators

1. Achievement

2. Recognition

3. Work Itself4. Responsibility

5 Advancement




Self Actualization = Achievement

Self Esteem = Recognition

Social

SafetyPhysiological

Maslow’s

Hierarchyof Needs

5. Advancement

6. Growth


ExamMcClelland’s Achievement

A person’s motivation and effectiveness

are influenced by three needs:




ExamTip “Theory of

Needs” Affiliation

Power


• prized assignments• responsibility

• presentation opportunities• training opportunities-growth• flexible scheduling/days off

• Recognition of achievement• better offices, new

equipment• bonuses, trips• promotions, pay raises




Be sure the link between performance and reward isclear, explicit, timely, and achievable.

Be sure to reward desired behaviors more thanrecovery from the results of undesired behaviors.

Consider cultural factors such as individualism vs.

collectivism in choosing rewards and givingrecognition (team vs. personal).

A

Page 240

Outputs: Team Performance Assessments

Position Descriptions

show team member

responsibilities,authority,competencies, and

9.3.3 Develop Project Team

improvements inindividual skills

I t i

Performance

Assessments




qualifications outlinedin a text document.

Improvements inteam behaviors

improvements inprojectperformance

reduced staffturnover rate.



Outputs


Tools &Techniques

Inputs

Human resource management

PMBOK®

Fifth

Edition, Page

279





Project documents updatesEnterprise environmental

factors updatesOrganizational process assets

updates

Observation and conversationProject performance appraisalsConflict managementInterpersonal skills

gplan

Project staff assignmentsTeam performance assessments

Issue logWork performance reportsOrganizational process assets

Page 242


Manage Project Team

is the process of tracking teammember performance, providing

feedback, resolving issues andmanaging team changes tooptimize project performance




Team members are accountable both to theirfunctional manager and to their project manager.

Effective Management of the dual reporting relationshipis the responsibility of the Project Manager

ExamTip

9.4.1 Manage Project TeamInputs:

• Human Resource Management Planresponsibilities, project organization, staffing management

plan.• Project Staff Assignments

• Team Performance Assessments




• Team Performance Assessments

• Issue Log

• Work Performance Reportsproject status, project forecasts, schedule/cost/qualitycontrol, scope validation, future HR requirements


• OPA

9.4.2 Manage Project Team

Fill in the last column with PM (Project Manager), T (Team member) or SM (Senior/FunctionalManagement) 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

Tools and Techniques: Project Performance Appraisals,

Roles and Responsibilities

Exercise




(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

Page 245

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 –

SM

SM

SM




12 Senior management provides an unrealistic schedule requirement –

13The 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

PM

PM

T

SM

Page 245

9.4.2 Manage Project TeamTools and Techniques: Powers of a Project Manager

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




ExamTip

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

9.4.2 Manage Project TeamTools and Techniques: Conflict Management

Conflict ResolutionBest to Worst

1. Collaborate/Problem Solving: solving the real problem2. Compromise/Reconcile: solutions that satisfy all parties




ExamTip

p y p3. Withdraw/Avoid: retreating or postponing a decision4. Smooth/Accommodate: emphasis on agreement rather than differences

5. Force/Direct: one viewpoint at the expense of another

Principles of Project Management, PMI, ISBN: 1-880410-30-3

9.4.2 Manage Project Team

Factors for Conflict Resolution

• Importance and intensity of conflict• Time pressure to resolve

• Position taken by persons involved

Tools and Techniques: Conflict Management




ExamTip

y p

• Motivation to resolve, long and short term

9.4.2 Manage Project TeamTools and Techniques: Conflict Management

Sources of Conflict(order of priority)

1. Schedules

2. Project priorities

ExamTip




3. Resources

4. Technical opinions

5. Admin. Procedures

6. Cost

7. Personality

Principles of Project Management,PMI, ISBN: 1-880410-30-3

9.4.2 Manage Project TeamTools and Techniques: Interpersonal Skills

The Fourth Edition was the first time the “soft skills” have been givenspecial recognition by PMI in the guidebook.

Please refer to Appendix X

3 in the Fifth Edition for a listing of

E




interpersonal skills important to project management. PMI said theseskills were too large to cover in-depth in the PMBOK. This makes it a ripe

source for questions on the fifth edition test.

ExamTip

9.4.2 Manage Project TeamTools and Techniques: Leadership

Leadership focuses team efforts toward a common goal. Leaders getthings done through other people. They develop

trust

and

respect, not

fear and submission.




9.4.2 Manage Project TeamTools and Techniques: Leadership, the Team Performance Curve

P e r f o r m a n c e I m p a c t

RealTeam

High-PerformanceTeam




Team Effectiveness

P

Pseudo-Team

WorkingGroup

PotentialTeam

Katzenbach and Smith“The Wisdom of Teams”

A high performing team is

:

• A small group of people• with complimentary skills

• committed to a common





• 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

9.4.2 Manage Project TeamTools and Techniques: Communication and Influencing

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)

Communication

ExamTip




( )

• Conflict resolution is part of communication (mentioned earlier)

• 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

9.4.2 Manage Project TeamTools and Techniques: Decision Making

• 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

9.4.2 Manage Project TeamTools and Techniques: Negotiation

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

ExamTip




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 ofvalue. Don’t just give in.

6. Both parties should feel like they won (win-win). Never let theother party leave feeling they have lost.

7. Do a good job of active listening and articulating

9.4.2 Manage Project TeamTools and Techniques: Appendix

X3,

Covey,

Dinsmore

, Levin,

Verma

Seven Habits of Highly Effective People

Habit 1:

Be Proactive: Principles of Personal ChoiceHabit 2:

Begin with the End in Mind: Principles of Personal VisionH bit 3

P t Fi t Thi Fi t P i i l f I t it & E ti

ExamTip

Stephen R. Covey, 2004




Habit 3: Put First Things First: Principles of Integrity & ExecutionHabit 4: Think Win/Win: Principles of Mutual Benefit

Habit 5: Seek First to Understand, Then to be UnderstoodHabit 6: Synergize: Principles of Creative CooperationHabit 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)

9.4.2 Manage Project TeamTools and Techniques:

Trust Building

• 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

Trust Building




ExamTip

• 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

10.2 Manage Communications

Executing: Communications Management

Outputs

Project communications

Tools &Techniques

Communication technologyC i ti d l

Inputs

Communications management

PMBOK®

Fifth

Edition, Page

297




jPM plan updatesProject documents updates

Organizational process assetsupdates

Communication modelsCommunication methodsInformation management

systemsPerformance reporting

gplan

Work performance reports


Page 255

10.2 Manage Communications

Manage Communications is theprocess of creating, collecting,

distributing, storing, retrieving,and the ultimate disposition ofproject information inaccordance with the




accordance with theCommunications Management

Plan.

Page 255

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 )

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 tothe projects’ complexity and the audience’sneeds

• 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 a dministrative overhead thanit’s worth

• is acceptable and useful to all participants

• gives warning of problems in ti me for preventiveor corrective actions

• is easily understood by those who have a need toknow

Purpose of Performance Reports:

• to detect problems in time to take corrective or preventiveaction

• to reduce customer and management anxiety

• to share project information within the project team

More on these reports later . . .



Communication Technology Technology can vary from project-to-project and throughout the lifecycle 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




pp p p jand any barriers (noise) are identified and managed.

Communications MethodsMethods to communicate can take place through many media. Effectiveand 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)



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 tocommunicate progress and to forecast project results. Simple reports show percent completeor 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.

12.2 Conduct Procurements

Executing: Procurement Management

Outputs

Selected sellersAgreements

Tools &Techniques

Bidder conferencesProposal evaluation

techniques

Inputs

Project management planProcurement documentsSource selection criteria




Resource calendarsChange requests

Project management planupdatesProject documents updates

techniquesIndependent estimatesExpert judgment

AdvertisingAnalytical techniquesProcurement negotiations

Source selection criteriaSeller proposalsProject documents

Make-or-buy decisionsProcurement statement of workOrganizational process assets

Page 260

12.2 Conduct Procurements

Conduct Procurements is theprocess of obtaining seller

responses, selecting a seller andawarding a contract.




It may involve developing a shortlist of qualified sellers which are

then subject to furtherinformation

Page 260

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

12.2.1 Conduct ProcurementsInputs




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

Pages 260-261

Bidder Conferences – Assembling allprospective vendors in a single meeting, with

information disseminated and individual bidslater received

Proposal Evaluation Techniques –

Comparison of alternative proposals on theb i f d

W i ht d S i

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




basis of vendor responses. Weighted Scoringis a commonly used technique

Independent Estimates – Use of an outsideprofessional to provide a benchmarkestimate of costs in advance of receivingproposalsExpert Judgment – Experts from variousdisciplines may be used to evaluate and

advise on proposals

• Typical factors include technical,

management, and cost factors

• Avoid overly complicated rating models

Pages 262-263

Advertising – Advertising in selectednewspapers or trade publications.Government may require advertising ofcertain kinds of contracts.

Analytical Techniques – evaluate readiness ofa seller, examine past performance for risks.

12.2.2 Conduct ProcurementsTools and Techniques




Procurement Negotiations – The projectmanager may not be the lead negotiator in

many cases, but will provide technical andproject clarification.

Pages 263-264

12.2.2 Conduct ProcurementsTools and Techniques: Procurement Negotiations

• responsibilities and authorities (Who Will Negotiate?)• pricing, payments, and payment schedules

… undertaken to clarify structure, requirements,

and contract terms so that mutual agreement on

contract terms can be reached prior to signing.




p g p y p y• 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.

Page 264

Selected Sellers:

Sellers who are competitive and have

negotiated a draft contractAgreements:

A legal agreement between Buyer and Seller,mutually binding. It includes many

12.2.3 Conduct ProcurementsOutputs




mutually binding. It includes manyrequirements and terms that you shouldremember, including Incoterms and ADR.Read this section carefully.

Page 265

12.2.3 Conduct ProcurementsOutputs: Types of Contracts



Used on well specified projects for which costs can be accuratelyestimated. Cost risk is on the supplier. (includes FFP, FPIF, FP-EPA)

ExamTip





Used on development projects for flexibility. Cost risk is on the buyer, so

establish administrative & reporting systems to allow both buyer and sellervisibility into costs. (Includes CPFF, CPIF, CPAF)

Used on projects where the deliverables are well defined, repetitive unitsbut the quantities are not yet known (e.g., identical pieces of equipment, or

labor hours and associated material costs – includes overhead and burden)

p

13.3

Manage Stakeholder

Engagement

Executing: Stakeholder Management

Outputs

Issue logChange requestsP j l

Tools &Techniques

C i i h d

Inputs

Stakeholder management planC i i

PMBOK®

Fifth

Edition, Page

404





Project documents updatesOrganizational process assetsupdates

Communication methodsInterpersonal skills

Management skills

Communications managementplan

Change logOrganizational process assets

Page 268

13.3 Manage Stakeholder Engagement

Manage Stakeholder Engagement is theprocess of communicating and working withstakeholders to meet their needs, addressissues as they occur, and foster stakeholderengagement in project activities throughoutthe project life cycle.

i k h ld i h




Managing stakeholders increases thelikelihood 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, andunderstanding the issues and change logs.

Pages 268

The Project Manager (PM) is responsible for engaging and managingstakeholders.

Monitoring & Controlling Process GroupPMBOK®

Fifth

Edition, Page

86




Process Groups


Monitoring &

Controlling




Change Control


5.1


Define Scope

5.5 Validate Scope

5.6 Control Scope


6.1

Define Activities6.2Sequence Activities6.3

Est. Activity ResourcesEst. Activity Durations6.5Dev. Schedule



7.2 Estimate Costs


7.4 Control Costs


5.4 Create WBS

6.4

4.6 Close Project

or Phase

Plan Scope Mgt.

5.3

Plan Schedule Mgt.

6.6

7.1 Plan Cost Mgt.


Monitoring and Controlling

4.4 Manage and ControlProject Work

4.5 Perform IntegratedChange Control5.5 Validate Scope5.6 Control Scope








9.1 Plan Human








11.2 Identify Risks




11.6 Control Risks




Engagement


Engagement




Management

6.7 Control Schedule7.4 Control Costs

8.3 Control Quality10.3 Control Communications11.6 Control Risks12.3 Control Procurements13.4 Control Stakeholder

Engagement


M&C: Integration Management

Outputs

Change requestsWork performance reports

Tools &Techniques

Expert judgmentAnalytical techniques

Inputs

Project management planSchedule forecastsCost forecasts

PMBOK®

Fifth

Edition, Page

86




Work performance reportsProject management plan


Analytical techniquesProject management

information systemMeetings

Cost forecastsValidated changes

Work performance informationEnterprise environmental factorsOrganizational process assets

Page 274


Monitor and Control Project

Work is the process of tracking,

reviewing and reporting theprogress to meet theperformance objectives definedin the project management plan




in the project management plan.

Control includes determiningcorrective action, preventativeaction or defect repair andfollowing up on actions taken toresolve performance issues

Page 274


Taken together, the controlling processes monitor project progress and performance

against 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 are

repeated 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 of




project control, it is only a part. Fully integrated project control draws from severalknowledge areas and calls upon all of the leadership, communication, and negotiation

skills 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.


This process is part of Project Integration Management knowledge area,

along with Integrated Change Control. This process involves

monitoring

all

processes: initiating, planning, executing, and closing.

Monitoring &





Planning

Processes

Executing

Processes

Initiating

Processes

Closing

Processes

Inputs: The Project Management Plan (Another Reminder)

4.4.1 Monitor and Control Project Work

Plan Scope Management Collect Requirements Define Scope

Determine Budget Plan Quality Management Plan Human Resource Management

The other 23 planning processes are integrated to create the projectmanagement plan. Updates to any plans require an update to the PM plan. Think

of the PM plan as a bucket into which all the other plans “drip” until it is full.




Define Scope Create WBS

Plan Schedule Management Define Activities Sequence Activities Estimate Activity Resources Estimate Activity Durations


Plan Human Resource Management Plan Communications Management

Plan Risk Management Identify Risks Perform Qualitative Risk Analysis Perform Quantitative Risk Analysis Plan Risk Response


Other Inputs:


• Schedule Forecastsusing schedule variance (SV) and schedule performance index

(SPI) to compute estimate to complete (ETC)

• Cost Forecastsusing cost variance (CV) and cost performance index (CPI) to

t ti t t l ti (EAC)




compute estimate at completion (EAC)

• Validated Changes• Work Performance Information

collected data is analyzed and transformed into workperformance information

• EEF and OPA

Work Performance Information

• Status of deliverables

• Implementation of change requests

• Forecasts: variance, trend, and earned valueinformation, estimates at completion (EAC),schedule forecasts, index information

(SPI CPI TCPI)




(SPI, CPI, TCPI).

• Generally involves Gantt charts and S-curves.• Includes cost, schedule, quality and scope

accomplishment and variance information

Page 276

Tools and Techniques:


• Expert Judgment

• Analytical Techniquesregression analysis, grouping methodscausal analysis root cause, FMEA, trends, etc.

• Validated Changes




g

• PMIS and Meetings

4.5 Perform Integrated Change Control

M&C: Integration Management

Outputs

Approved change requestsChange log

Tools &Techniques

Expert judgment

Inputs

Project management planWork performance reports

PMBOK®

Fifth

Edition, Page

94




Change logProject management plan


Expert judgmentMeetingsChange control tools

Work performance reportsChange requestsEnterprise environmental factorsOrganizational process assets

Page 279

4.5 Perform Integrated Change Control

Perform Integrated Change Control

is the process of reviewing allchange requests, approvingchanges and managing changes to

deliverables, organizational processassets, project documents and theproject management plan; andcommunicating their disposition.




Sometimes a Change Control Board

(CCB) is responsible for approvingor rejecting changes, as approvedby the customer or sponsor.

Page 279-280

Configuration Control focuses on the specification of deliverables andprocesses.

Change Control focuses on changes to project documents, deliverables orbaselines.

4.5 Perform Integrated Change ControlChange

Control System

A set of procedures that describes how modifications to theproject deliverables and documentation are managed andcontrolled, including:

• requesting changes• reviewing the implications of changes requests




• approving or rejecting changes

• communicating changes• maintaining a change log - comprehensive list of changes

4.5.2 Perform Integrated Change ControlTools and Techniques: Configuration Management

A set of processes and procedures to ensure that thedocumentation of the product and the actualproduct remain consistent with each other:

Glossary Definition:

The config ration management s stem is a collection of proced res sed

ExamTip




The configuration management system is a collection of procedures usedto identify and document the functional and physical characteristics of aproduct 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.

4.5.1 Perform Integrated Change ControlInputs: 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 muchk i j t d

A burnup chart tracks how much




work remains on your project andwhether or not you will hit the deadline.

work is done.

4.5.1 Perform Integrated Change ControlInputs: 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

ExamTip




(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 “meet

with management first” The correct answer is evaluate first

4.5.2 Perform Integrated Change ControlTools and Techniques: Change Control Meeting

Approved or Rejected Change Requests

A formally chartered group responsible for reviewing, evaluating,i d l i j ti h t th j t d f di

In some projects, changes are controlled by a Change Control Board (CCB),

And implemented by the Project Team

A Change Control Board (CCB) is:




approving, delaying, or rejecting changes to the project, and for recordingand 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 implementationof approved changes.

• Power and responsibilities should be reviewed and agreed to by

stakeholders

5.5 Validate

Scope

M&C: Scope Management

Outputs

Accepted deliverablesChange requests

Tools &Techniques

Inspection

Inputs

Project management planRequirements documentation




Work performanceinformation


Group decision-makingtechniques

Requirements traceability matrixVerified deliverablesWork performance data

Page 285

5.5 Validate Scope

Validate Scope

is the process offormalizing acceptanceof the completedproject deliverables.

Scope validation is

PMBOK® Fourth Edition, Page 123




Scope validation isdifferent from quality

control in thatvalidate scope isprimarily concernedwith the acceptance ofthe deliverables

Page 285

5.5.3

Validate ScopeOutputs: 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

ExamThe questions on the exam are vague on Scope Validation.




Tip 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.

5.6

Control Scope

M&C: Scope Management

Outputs



Tools &Techniques

Inputs

Project management planRequirements documentation

PMBOK®

Fifth

Edition, Page

136




updatesProject documents updatesOrganizational process assets

updates

Variance analysisRequirements traceability matrixWork performance dataOrganizational process assets

Page 288

5.6 Control Scope

Control Scope is the processof monitoring the status of theproject and product scope and

managing changes to thescope baseline

Uncontrolled changes areoften referred to as

Scope




often referred to as Scope

Creep.

Page 288

5.6.1 Control ScopeInputs

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:




p j g p g p

The scope baseline Scope management plan Change management plan Configuration management plan Requirements management plan

5.5.2 Control ScopeTools and Techniques: Variance Analysis

… a comparison of actual results to planned results for the purpose of early

problem detection ...

• Cost, schedule, scope, and quality variancesare most typical – but they can also includeresources and risk variances.

• Both positive and negative variances need




analysis

• Should involve an evaluation of cause andimpact

• Becomes an input to change control processfor generating corrective actions

5.5.2 Control ScopeOutputs: Work Performance Information




6.7

Control Schedule

M&C: Time Management

Outputs


Schedule forecastsChange requestsP j l

Tools &Techniques

Performance reviewsProject management

softwareResource optimization

Inputs

Project management planProject scheduleWork performance data

PMBOK®

Fifth

Edition, Page

185





Project documents updatesOrganizational process

assets updates

techniques

Modeling techniquesLeads and lagsSchedule compressionScheduling tool

Work performance dataProject calendars

Schedule dataOrganizational process assets

Page 292


Control Schedule is the processof monitoring the status ofproject activities to updateproject progress and managechanges to the schedule baselineto achieve the plan




6.7.1 Control ScheduleInputs

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

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 ofwork completed (earned value)

(3) requires a way to collect actual

costs at work package level

PV

AC

Actual Cost

CV




t Actual

t When Planned

Time

Cost,Hours,or WorkProducts

EV

Work Performed(Earned Value)

PV

Planned Value

SVScheduleVariance

CVCost

Variance

Pages 294-295

6.7.2 Control ScheduleTools and Techniques: Variance Analysis

… a comparison of actual results to planned results for the purpose of early


• Cost, schedule, scope, and quality variancesare most typical – but they can also includeresources and risk variances.





analysis

• Should involve an evaluation of cause andimpact

• Becomes an input to change control processfor generating corrective actions

6.7.2 Control ScheduleTools and Techniques: Corrective Action

* Taking action to expedite schedules, suchi i diff t

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 theloop between project control and project execution:




as assigning more or different resources or

overlapping tasks

* Delaying a purchase to protect cash flow

* Invoking planned risk responses when riskevents occur

6.7.2 Control ScheduleTools and Techniques: Trend Analysis

• a tool that uses mathematicaltechniques to forecast future

outcomes based on past results

• may be used to monitor quality(product), cost and

scheduleperformance of a project




performance of a project

• provides a high-level overview thatindicates whether or not moredetailed information is needed The Rule of Seven: 7 data

points all above or below themean, or all increasing or

decreasing, indicate a trend

6.7.2 Control ScheduleTools and Techniques: Project Management Software




6.7.2 Control ScheduleTools and Techniques: Resource

Optimization Techniques

Month 1 Month 2 Month 3 Month 4

Resource plans are best when resource requirementsincrease and decrease without variations

1.5

The

resource histogram is a time-phased display of the amount ofproject work assigned to each resource (PMBOK Fifth Edition, Page 189-190)




Product Manager

0.5

1.0

6.7.2 Control ScheduleTools and Techniques: Modeling Techniques




6.7.2 Control ScheduleTools 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

3,000

1,0001,500

Crash Costper week

1,5001,0001,500

Fast TrackingParalleling - Activities or phases normally be done in sequence are performed in




Paralleling Activities or phases normally be done in sequence are performed inparallel 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 riskand/or cost.

ExamTip

7.4

Control Costs

M&C: Cost Management

Outputs


Cost forecastsChange requestsProject management plan

Tools &Techniques

Earned Value ManagementForecastingTo-complete performance

index (TCPI)

Inputs

Project management planProject funding requirements

PMBOK®

Fifth

Edition, Page

215






assets updates

index (TCPI)Performance reviews

Project management softwareReserve analysis

Work performance data


Page 300

7.4 Control Costs

Control Costs is the process ofmonitoring the status of theproject to update the project

costs and managing changes tothe cost baseline




7.4.1 Control CostsInputs: Project Management Plan (Cost Management Plan & Cost Baseline)

Cost Cost Performance Baseline

CumulativePlanned Value (PV)

Spending Plansand Cash Flow

ExamTip

A time-phased budget (either by performance period or summed cumulativelyover the life of the project) used to monitor and control project costs.

BAC




Time

Planned Value (PV)

Monthly PlannedValue (PV)

Plans are special

types of CostBaselines

7.4.1 Control CostsInputs: Project Funding

Requirements and Management Reserve

ExamTip

Cost

Cost BaselineCumulative Planned

Value (PV)

}Management

Reserve

Project Budget

BAC

EAC (forecasted cost)




Time

Cash FlowFunding

Expenditures

7.4.1 Control CostsInputs: Work Performance

Data

• Organizes and summarizes information on projectstatus and progress

• It includes data on activities that have started , theirprogress, and which deliverables have been finished

• Includes cost, schedule, scope accomplishment and variance information

• Includes data on costs authorized and costs incurred




Caution: Ensure a consistent “data date”,

ideally from a common set of data

• Includes data on costs authorized and costs incurred

7.4.2 Control CostsTools and Techniques: Earned Value Management (EVM)

Earned value management (EVM), also known as earned

value 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.

ExamTip




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.


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?

PV

AC

EV

BAC

EAC

Planned Value

Actual Cost

Earned Value

Budget at Completion

Estimate at Completion




How much more do we estimate the job will cost?

How much over/under budget will we be?

ETC

VAC

Estimate to Complete

Variance at Completion

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 PerformanceIndex

Less than 1.0 = Behind scheduleGreater than 1.0 = Ahead of schedule

EAC Estimate at Completion(4 formulas)

Used when EV trend is typical (CPI will be thesame for the rest of the project)

EAC AC + (BAC EV)

BACCPI

EVAC

CPI =

EVPV

SPI =

EAC =




Definition:At this time in the project,what is the forecast oftotal project cost?

Used when EV trend is atypical (CPI will

change to follow the planned rate, or PV line)

Actual cost plus bottom-up estimate tocomplete by the team. (plan is no longer valid,re-estimate the plan)

Used when both CPI and SPI influence theremaining work. Assumes negative costperformance and need for firm schedule.

EAC = AC + (BAC-EV)

(BAC-EV)

(CPI x SPI)

EAC = AC + ETC

EAC = AC +

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 remainingwork. If work is proceeding on plan, use thisthis to calculate the work remaining

Bottom up re-estimate by the team

TCPI

Based

on

Less than 1.0 = Easier to completeGreater than 1.0 = Harder to completeBAC-EV

BAC ACTCPI =

7.4.2 Control Costs




BAC

Based

on

EAC

VAC

Cost efficiency that must

be maintained tocomplete the project onplan (BAC).

Cost efficiency that mustbe maintained tocomplete the current EAC.

Variance at Com letion

(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 bycalculated estimate to complete, ETC)

At the end, how much more or less than planwill we have spent?

BAC-AC

BAC-EVEAC-AC

TCPI =

VAC = BAC-EAC


EACWork Products

Money Hours Deliverables.

$2,000 200 20

$3,000 300 30

ACCost

ProjectedOverrun

PV( li )

BAC




0

$1,000 100 10

1 2Weeks

3

Schedule Variance (SV)

Variance

(CV)

EV

(Baseline)

7.4.2 Control CostsTools 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

WBSCum Hrs

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

-70 hours

733 hours

570 hours

Exercise

Dimensions of Project Performance

PV = Planned ValueAC = 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

CPIcAC

c

+




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

50 50

100 100

100 100

EVc = 150 hours

PVc = 200 hours

SV = - 50 hours

EVc = 150 hours

ACc = 220 hours

CV = - 70 hours

Cost at Completion = 220 + [(500-150)/(150/220)]

(Typical) = 733 hours

Cost at Completion = 220 + (500 -150)

(Atypical) = 570 hours

PV

= BAC/CPI

Page 308

7.4.2 Control CostsTools 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.




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 of CPI 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]

7.4.2 Control CostsTools 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.

To Achieve a Target BAC To Achieve a Target 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


-


The TCPI is compared to the cumulative CPI to determine if a target EAC isreasonable, 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




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 becompleted (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.


-


To-Complete Performance Index

+TCPI (BAC)

Status Date

To-Complete Performance Index




1.00

-

Baseline Plan

TCPI (EAC)

Cumulative CPI

8.3

Control Quality

M&C: Quality Management

Outputs

Quality controlmeasurements

Validated changesVerified deliverablesWork performance informationChange requests

Tools & Techniques

Seven basic quality toolsStatistical samplingI ti

Inputs

Project management planQuality metricsQuality checklistsWork performance dataApproved change requests

PMBOK®

Fifth

Edition, Page

248






assets updates

Inspection

Approved change requestsreview

Approved change requests

DeliverablesProject documentsOrganizational process

assets

Page 315

8.3 Control Quality

Perform Quality Control isthe process of monitoringand recording results of

executing the qualityactivities to assessperformance andrecommend necessarychanges




changes

Page 315

8.3.1

Control Quality

Quality Control (QC): a process of monitoring and recording results (both product

and project management ) of executing quality activities to assess performance and

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.




to recommend necessary changes. Involves identifying ways to remove the causes of quality 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.

8.3.2

Control QualityTools and Techniques

Cause and Effect Diagram

Control Charts

Flowcharting

Histograms

The first seven (7) Tools & Techniques in this section arecalled the

Seven Basic Tools of Quality - know these for thetest!

ExamTip

http://www.tresnainstrument.com/product/dc03.html

http://www.tresnainstrument.com/product/dc03.html




Pareto Diagrams

Checksheets

Scatter Diagram

8.3.2

Control QualityTools and Techniques: Cause and Effect Diagram


EFFECTCAUSES

People

Lack of Training

MethodsMaterialNot Following

Procedures




EFFECT


8.3.2

Control QualityTools and Techniques: Control Charts

A chart of process performance over time used todetermine if the process is in control or out of control

% 5

% 7

%

.. . ... .

.......UCL

. . ..

NormalDistributionCurve

Expected

Out of Control(Assignable Cause)




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.... ..

.. .

...

.....

LCL

. . .MeanExpected

Variation

8.3.2

Control QualityTools and Techniques: Control Charts

Plan or MeanUCL

LCL

Lower Spec. Limit

Upper Spec. LimitHours recorded for this projectstarted on plan, but if the trend

continues, hours spent will driftout of control.




Actual

8.3.2

Control QualityTools and Techniques: Flowcharting

Process Flowchart

Design Review

Revise

OK?

Yes

Proceed

No




8.3.2

Control QualityTools and Techniques: Pareto Charts

q u e n c y o f o c c u r r e n c e ) Pareto Diagram: a histogram, ordered by

frequency of occurrence, that shows the percent

contribution of each category of identified cause tothe overall quality defects in a product or process.

80%?

Pareto Analysis: Pareto diagrams help

project teams identify the vital few factors that




source

% c o n t r i b u t i o n ( o r f r e

Pareto’s Law:

80/20 Rule

Design of Experiments:

Which variables have influenceover the outcome.

“What If” Analysis

account for most quality problems from the morenumerous trivial many factors.

8.3.2

Control QualityTools and Techniques: Run Chart

… a tool that uses mathematicaltechniques to forecast futureoutcomes based on past results

… may be used to monitor quality(product), cost and scheduleperformance of a project

… provides a high-level overview that




p g

indicates whether or not moredetailed information is needed The Rule of Seven: 7 data

points all above or below themean, or all increasing ordecreasing, indicate a trend

8.3.2

Control QualityTools and Techniques: Scatter Diagram




8.3.2

Control QualityTools 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 an

appropriate choice of sample items and sample size.

• Sample size increases exponentially as the level of desired certaintyincreases and the acceptable level of error decreases




increases 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 sample

or consumer error (type II error) where unacceptable lots are acceptedbased on a non-representative sample.

8.3.2

Control QualityTools 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

http://search.aol.com/aol/imageDetails?s_it=imageDetails&query=inspection,+magnifying+glass&img=http://mystagedlife.com/wp-content/uploads/2008/03/magnifying-glass.jpg&site=&host=http://mystagedlife.com/category/local-news&width=137&height=103&thumbUrl=http://images-partners-tbn.google.com/images?q=tbn:qwrPu0vuUOh-tM:mystagedlife.com/wp-content/uploads/2008/03/magnifying-glass.jpg&b=image?query=inspection,+magnifying+glass&page=3&s_cs=4492289638552585718&s_it=rboxImgDtls&flv=1&icid=snap-pic&imgHeight=480&imgWidth=640&imgTitle=%3Cb%3Emagnifying%3C/b%3E+%3Cb%3Eglass%3C/b%3E&imgSize=111766&hostName=mystagedlife.com





• acceptance testing• reviewing• walk-throughs

Inspection generally takes place throughoutthe project’s lifecycle. Be sure to plan for it

accordingly and to include it in the WBS.


M&C: Communications Management

Outputs

Work Performanceinformation


updates

Tools &Techniques

Information managementsystems

Expert judgment

Inputs

Project management planProject communicationsIssue logWork performance data

PMBOK®

Fifth

Edition, Page

303






updates


assets updates

p j g

Meetings

Work performance data


Page 328


Control Communications is theprocess of monitoring andcontrolling communications

throughout the entire projectlife cycle to insure theinformation needs of theproject stakeholders are met.




Inputs: Work Performance D

ata

• 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?

?Earned Value Management: Test Yourself

10.3.1 Control Communications




• 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?

?

Outputs: Work Performance Information

10.3.3 Control Communications

Variance Analysis

… a comparison of actual results to p lanned results for the purpose of early


• Cost, schedule, scope, and quality variances

are most typical – but they can also includeresources and risk variances.


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 WhenPlanned

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


• 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

11.6

Control

Risks

M&C: Risk Management

Outputs



updatesP j t d t d t

Tools &Techniques

Risk reassessmentRisk auditsVariance and trend analysisTechnical performance

measurement

Inputs

Project management planRisk registerWork performance dataW k f t

PMBOK®

Fifth

Edition, Page

349





assets updates

Reserve analysisMeetings

Work performance reports

Page 335

11.6 Control Risks

Control Risks is the process ofimplementing risk responseplans, tracking identified

risks, monitoring residualrisks, identifying new risksand evaluating risk processeffectiveness throughout theproject




11.6.1 Control RisksInputs

Work Performance Reports

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




Guidelines for Performance Reports:

• keep the report short, matching its length tothe projects’ complexity and the audience’sneeds

• use a consistent template and format

• use visual elements such a s charts and graphs

Criteria for Performance Reporting:

• gives timely, complete, and accurate information

• doesn’t add more administrative overhead thanit’s worth

• is acceptable and useful to all participants

• gives warning of problems in time for preventiveor corrective actions

• is easily understood by those who have a need toknow

Purpose of Performance Reports:

• to detect problems in time to take corrective or preventiveaction

• to reduce customer and management anxiety

• to share project information within the project team

11.6.2 Control RisksTools 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.


analysis

• Should involve an evaluation of cause and

impact

• Becomes an input to change control process

• a tool that uses mathematicaltechniques to forecast future outcomes

based on past results

• may be used to monitor quality

(product), cost and schedule


• provides a high-level overview that

indicates whether or not more detailed

information is neededThe Rule of Seven: 7 data


Trend Analysis




Becomes an input to change control process

for generating corrective actions


mean, or all increasing ordecreasing, indicate a trend

11.6.2 Control RisksTools and Techniques: Reserve Analysis

A provision in the project plan to mitigate cost and/or schedulerisk

May be calculated as a percent of baseline to allow for overruns

May 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 total

reserve of 10%

11.6.3 Control RisksOutputs: 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 hadnot been planned or was not effective.Change requests can include corrective andpreventive 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

ExamTip




Contingency =

Pre-Planned

Was on

my test

ExerciseRisk 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?

Answer: Document and revisit frequently

Answer: No, a combination of choices

Answer: Watch for non-critical risks thatbecome more important

Answer: Risk




•How would risk be addressed in team meetings?

•Which are more frequent, contingency plans

or workarounds?

Answer: “Status of risks?”, “Any newrisks?”, “Any change to the

order of importance?”

Answer: With proper risk managementWorkarounds become lessfrequent than contingency plans.

12.3

Control

Procurements

M&C: Procurement Management

Outputs



updates

Tools &Techniques

Contract change controlsystem

Procurement performancereviews

Inspections and auditsPerformance reporting

Inputs

Project management planProcurement documentsAgreementsApproved change requestsWork performance reports

PMBOK®

Fifth

Edition, Page

379





assets updates

p g

Payment systemsClaims administrationRecords management

system

Work performance reportsWork performance data

Page 341

12.3 Control Procurements

Control Procurements is theprocess of managingprocurement relationships,

monitoring contract performanceand making changes andcorrections to contracts asappropriate




Inputs

Match Contract Type to the Project




Used on development projects for flexibility. Cost risk is on the buyer,

so establish administrative & reporting systems to allow both bu yer 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

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 de termine

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




but the quantities are not yet known (e.g., identical pieces of equipment, orlabor hours and associated material costs – includes overhead and burden)

p g p y y

• Your best defense against procurement scope creep!

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”

Tools and Techniques: Contract Change Control System


Contract Change Control System

Defines the process by which the contract can be modified. It is

part 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, or




default, 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 require

mediation or legal resolution.

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:

Example





• 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.

Tools and Techniques: Claims Administration


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 resolution




y p , y j pprocedures 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.

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 thatdescribes 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

12.3 Control Procurements




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

Page 350

13.4 Control Stakeholder Engagement

M&C: Project Stakeholder Management

Outputs



updates

Tools &Techniques

Information managementsystems

Expert judgment

Inputs

Project management planIssue logWork performance dataProject documents

PMBOK®

Fifth

Edition, Page

409





assets updates

Meetingsj

Page 351

13.4 Control Stakeholder Engagement

Control Stakeholder

Engagement is the process ofmonitoring overall project

stakeholder relationships andadjusting strategies and plans forengaging stakeholders. Thisprocess will increase theefficiency and effectiveness of




engaging stakeholders as theproject evolves.The Project Manager (PM) isresponsible for engaging andmanaging stakeholders.

Page 351

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 anddistributing information on cost schedule and performance.Reports can be consolidated from several systems fordistribution.




Examples are table reporting, spreadsheet analysis, andpresentations. Dashboard graphics can be used for visualpresentation of project performance

Closing Process Group




Process Groups


Monitoring &

Controlling




Change Control


5.1


Define Scope

5.5 Validate Scope

5.6 Control Scope


6.1

Define Activities6.2Sequence Activities6.3Est. Activity Resources

Est. Activity Durations6.5Dev. Schedule



7.2 Estimate Costs


7.4 Control Costs





9.1 Plan Human




5.4 Create WBS

6.4

4.6 Close Project

or Phase

Plan Scope Mgt.

5.3

Plan Schedule Mgt.

6.6

7.1 Plan Cost Mgt.


Closing

4.6 Close Project or Phase12.4 Close Procurements









11.2 Identify Risks




11.6 Control Risks

12. Project ProcurementManagement 12.1 Plan Procurement Mgt. 12.2 Conduct Procurements 12.3 Control Procurements 12.4 Close Procurements


Engagement


Engagement




Management


Closing: Integration Management

Outputs

Final product, service or resulttransition


Tools &Techniques

Expert judgmentAnalytical techniquesMeetings

Inputs

Project management planAccepted deliverablesOrganizational process assets

PMBOK®

Fifth

Edition, Page

100




updates

Page 355


Close Project or Phase isthe process of finalizingall activities across all ofthe Project ManagementProcess Groups toformally complete theproject or phase




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 the





action was taken.

Stakeholders are engaged in the process.

Page 355

4.6.1 Close Project or Phase

Inputs: The Project Management Plan (Another Reminder)

Plan Scope Management Collect Requirements Define Scope Create WBS Plan Schedule Management

Determine Budget Plan Quality Management Plan Human Resource Management Plan Communications Management Plan Risk 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.




Define Activities Sequence Activities Estimate Activity Resources Estimate Activity Durations Develop Schedule

Plan Cost Management Estimate Costs

g Identify Risks Perform Qualitative Risk Analysis Perform Quantitative Risk Analysis Plan Risk Response Plan Procurement Management

Plan Stakeholder Management


Inputs: 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 (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.


Outputs: Final Product, Service, or Result Transition

Final Product, Service, or Result Transition

The output of Close Project or Phase is the transition of what 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 of the project or phase have been met.





Outputs: Organizational Process Assets Updates

Organizational Process Assets Updates

Closure will include storage of project documentation using the configurationmanagement system. OPA updated during closure include:

Project FilesAssemble a complete set of project records from all processes for archiving, and updatinghistorical databases. Examples include: the PM plan, scope, cost, schedule, calendars, riskregisters, change documents, risk responses, and risk impact.

j h l




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, acceptancedocuments from Validate Scope and the contract to ensure that all requirements arecompleted.

Historical InformationLessons learned are transferred to archives for future use. This can be information on issuesand risks as well as techniques that worked well and can be applied to future projects.

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

PMBOK®

Fifth

Edition, Page

386





Close Procurements is theprocess of completing eachprocurement.

Contract closure involvesverification that all the work anddeliverables produced undercontract were

acceptable.

l h h




In multi-phase contracts, theterm of the contract may onlyapply to the end of each phase,and this process would closephase-end contracts.

Page 360

Contract closure involves verification that all the work anddeliverables produced under contract were

acceptable. It alsoinvolves updating records to as-built and archiving this information

for 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 parties

ll d b h

i i

l





are 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

Page 360

12.4.2 Close Procurements

Tools and Techniques: Procurement Negotiations

Negotiation is the primary goal for settlingdisputes

If this cannot be achieved, use AlternativeDispute Resolution (ADR) – Mediation orArbitration

Litigation is the

LEAST desirable option.




4.6 and 12.4

Close 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, butwith more attention on documentation, completion of filesand verification/acceptance.)





Plan Communications is the process of

determining the project stakeholder informationneeds and defining a communication approach

N(N

–

1)

Ch l

The formula:

One More Time: It was on my examination twice




2Channels =

Reveals the number of possible channelsof communication in a group, where N isthe number of people in the group

Page 166-167







was introduced into thePMBOK in version in it’s third

edition. It requires project

managers to consider legal andethical issues, and at all timesto focus on professionalism andadvancement of the professionof project management





• Think about Legal, ethical and professional behavior whenanswering exam questions

• You will be challenged with multiple situational questions

• Read PMI Member Ethical Standards: Member Code of Ethics andMember 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

ti t f l d




resorting to formal procedures• Focus on professionalism, integrity, responsibility, self-

improvement, fairness, honesty and communication

• Balance stakeholders’ interests


Read Pages 365-366 Carefully

Clarifying Information





Code of Professional Conduct 2006

CHAPTER 1. VISION AND APPLICABILITY1.1 Vision and PurposeAs practitioners of project management, we are committed to doing what is right and honorable. We set highstandards for ourselves and we aspire to meet these standards in all aspects of our lives—at work, at home, andin service to our profession.This Code of Ethics and Professional Conduct describes the expectations that we have of ourselves and our fellowpractitioners 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 individualbecome a better practitioner. We do this by establishing a profession-wide understanding of appropriatebehavior. We believe that the credibility and reputation of the project management profession is shaped by thecollective conduct of individual practitioners.We believe that we can advance our profession, both individually and collectively, by embracing this Code ofEthics and Professional Conduct. We also believe that this Code will assist us in making wise decisions, particularlywhen 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




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 andevolve our profession.

1.2 Persons to Whom the Code AppliesThe Code of Ethics and Professional Conduct applies to:1.2.1 All PMI members

1.2.2 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.


Code of Professional Conduct 2006CHAPTER 2. RESPONSIBILITY

2.1 Description of ResponsibilityResponsibility is our duty to take ownership for the decisions we make or fail to make, the actions we take or failto take, and the consequences that result.

2.2 Responsibility: Aspirational StandardsAs 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, andthe 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 promptlyWhen e disco er errors or omissions ca sed b others e comm nicate them to the




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 theappropriate body as soon they are discovered. We accept accountability for any issues resultingfrom 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.



2.3 Responsibility: Mandatory Standards

As practitioners in the global project management community, we require the following ofourselves and our fellow practitioners:

Regulations and Legal Requirements2.3.1 We inform ourselves and uphold the policies, rules, regulations and laws thatgovern our work, professional, and volunteer activities.

2.3.2 We report unethical or illegal conduct to appropriate management and, ifnecessary, 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




2.3.3 We bring violations of this Code to the attention of the appropriate body forresolution.

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.



CHAPTER 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 naturalor 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




3.2.4 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 ofourselves 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.



CHAPTER 4. FAIRNESS

4.1 Description of FairnessFairness is our duty to make decisions and act impartially and objectively. Our conduct must be free fromcompeting 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




As practitioners in the global project management community, we require the following of ourselves and ourfellow 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 mitigationplan; and we have obtained the consent of the stakeholders to proceed.



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.






CHAPTER 5. HONESTY

5.1 Description of HonestyHonesty is our duty to understand the truth and act in a truthful manner both in our communications and inour conduct.

5.2 Honesty: Aspirational StandardsAs 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




As practitioners in the global project management community, we require the following of ourselves and ourfellow practitioners:

5.3.1 We do not engage in or condone behavior that is designed to deceive others, including butnot limited to, making misleading or false statements, stating half-truths, providing informationout of context or withholding information that, if known, would render our statements asmisleading or incomplete.

5.3.2 We do not engage in dishonest behavior with the intention of personal gain or at the expenseof another.


Read Pages 375-377 Carefully

History of the Standard

Glossary





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




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 thestate/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 andresearch.

2. Responsibility to support and disseminate the professional code of conduct to other PMI certificants.


P.M.P ® Code of Professional ConductI. 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




1. Responsibility to ensure that a conflict of interest does not compromise legitimate interestsof 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.

Professional responsibility

Types of Questions to Expect

You are building a water treatment facility. Routine tests indicatethat there are contaminants in the water but that they have anextremely low risk of causing sickness. As a project manager you

should:

A. Inform the public that a detailed examination has been orderedto determine the extent to which the problem exists

B. Do nothing because there is an extremely low risk except forsome effects on small children or the elderly

C. Tell the public there is no problem, except for small children and




A. Inform the public …

C. Tell the public there is no problem, except for small children andthe elderly who should boil their water before drinking it

D. Educate the public about the advances in water treatmenttechnology and the industry efficiency and safety record



B. Requirements

A KEY activity to defining customer satisfaction is to define:

A. Business Use

B. RequirementsC. Product SpecificityD. Change Control






B. Develop alternative solutions to the problem

When it appears that a design error will interfere with technicalperformance 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




B. Develop alternative solutions to the problem



B. Training

What is the MOST effective practice to ensure that cultural andethical differences do not impede the success of your multi-nationalproject?

A. Co-LocatingB. TrainingC. FormingD. Teaming




B. Training



A Mutual trust and cooperation

Negotiating across international cultures involves mutualinterdependence between parties. The negotiations MUST beconducted in an atmosphere of:

A. Mutual trust and cooperationB. Generalities and vaguenessC. Sincerity and compassionD. Uncertainty and caution




A. Mutual trust and cooperation

PMP

®

Certification Test Preparation




New Test and New PMBOK

®

Edition

The PMBOK® 5th

Edition was released in January2013. The test changed again on July 31, 2013.A new Knowledge Area was introduced:Stakeholder Management.




Qualification Requirements


years

35 contact hours(PDU’s) of PM

education

+ =

Graduate, 4-Year Degree

Non-Graduate, or 2-Year Degree

Eligibility to takethe PMP®

examination

The T&T CD ID is E1091and Awards 11 PDU’s

PMTestOnline is C4070and Awards 11 PDU’s





years

Page 2

This Course ID is E1078

and Awards 24 PDU’s

PMBOK Fifth Edition and the New Test

The PMBOK Fifth Edition was introduced in January 2013, and thenew fifth edition test started on July 31, 2013.

The PMP examination consists of 200 questions, with a four hourtime 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

PMBOK

5

th

Edition PMP Test Domain Content

Project Initiation 13%Project Planning 24%

Project Execution 30%Project Monitoring & Control 25%Project Closing 8%

To pass, you need to get a minimum of 122ti t t f 200 ti (61%)

http://www.pmi.org/

http://www.pmi.org/




To pass, you need to get a minimum of 122questions correct out of 200 questions (61%)

Pass rate on the 4th Edition test is about 74%

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

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




PMI ® may audit when you pay your exam fee to PMI. If you cancel or reschedulewithin 30 days of the test, there is a fee of $70; within 2 days, you forfeit the entire fee.

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

Taking the PMP

®

examination

Ensure youhave therequired

experience

Send inyour

application

Ensure youhave 35PDU’s

AND

Join thePMI® (if you

haven’t)

Studyhard forabout 2weeks

Take theexam

and pass

www pmi org

Scheduleexam at

Prometrics




Complete aPMP® Prep

course

www.pmi.org

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 littlelonger.

• 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. Thisfeature must be requested by you in your application

http://www.pmi.org/Certification/Project-Management-Professional-PMP.aspx






y g q y g gfeature must be requested by you in your application.

• In some countries, the test may be given on paper, in English, not in yournative language.

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

Page 345

Reasons people fail the exam

• They do not read all the questionscorrectly

• They do not read all the choices ineach 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

Page 346

• Go to the test center before the day of your test, find where it is, look at thetesting 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 testingroom. A pop-up calculator is available on the computer. If that is awkward foryou to use, ask the administrator to provide a calculator for you.

• You will be given scrap paper, pencils, and in some test centers, earplugs.

Taking the PMP

®

examination




• All personal items will be safely stored for you and cannot be taken into the testroom.

Page 346

• Upon entering the test room, you will be given 15 minutes to use the computertutorial and to become familiar with the commands. You can mark questions onthe computer and return to the marked questions later, or you can reviewevery 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 arei di t l d d Th t t ll if A t

Taking the PMP

®

examination




immediately graded. The computer tells you if you pass. A temporarycertificate 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.

Page 346

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 to

use 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.




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.

Page 347

h kb k

Practice Test #3

CONGRATULATIONS !!!

You have just completed more

than the entire PMP Test!

You have done 228 questions




Turn to page 449 in the workbookThere are 100 questions.

You have 120 minutes to completeAnswers are on page 475

Page 403
