Program Management Professional (PMP)

Project Management Professional (PMP)Certification Study GuidePMI Certification MaterialsTo assist PMI candidates for completing the PMI certification exam administered by the Project Management InstituteContent is from A Guide To The Project Management Body Of Knowledge (PMBOK)www.pmi.orgRecurring ThemesHistorical Records need to collect and use for planning, estimating and riskKickoff meetings are importantWork Breakdown StructuresDo not introduce benefits that are not stated in requirementsNeeds of all stakeholders should be taken into account during all projectsTeam Members must be involved in project planningProject Mangers must be pro-activeChapter 1 IntroductionProject temporary endeavor undertaken to create a unique product or serviceHas a definite beginning and end and interrelated activitiesPrograms adopt new set of objectives and continue to work; projects cease when declared objectives have been attainedChapter 1 IntroductionProjects are unique characteristics are progressively elaboratedProgressively: proceeding in stepsElaborated: worked with care and detailScope of project should remain constant even as characteristics are progressively elaboratedChapter 1 - IntroductionProject Management: the application of knowledge, skills, tools and techniques to project activities in order to meet or exceed stakeholder needs and expectations from a defined project balancing the following:Scope, time, cost, and qualityStakeholders expectationsRequirements (needs) vs. unidentified requirements (expectations)Chapter 1 - IntroductionPrograms are groups of projects managed in a coordinated way to obtain benefits not available from managing the projects individuallyMost programs have elements of ongoing operationsSeries of repetitive or cyclical undertakingsProjects are often divided into subprojects for more manageabilityOften contracted out to external organizationsChapter 2 Project Management ContextProject Phases are marked by the completion of a deliverableTangible, verifiable work productReview of deliverables and approval/denial are phase exits, stage gates, or kill pointsPhases are collected into the Project Life CycleSet of defined work procedures to establish management controlChapter 2 Project Management ContextProject Life Cycle defines:Technical work performed in each phaseWho is involved in each phaseProject Phases can overlap Fast TrackingCommon Characteristics of Project Life Cycles:Cost and Staffing levels are low at start and move higher towards the endProbability of successfully completing project is low at beginning, higher towards the end as project continuesStakeholder influence is high at the beginning and progressively lowers as project continues

Chapter 2 Project Management Context Stakeholders: individuals and organizations who are actively involved in the projectOften have conflicting expectations and objectivesIn general, differences should be resolved in favor of the customer individual(s) or organization(s) that will use the outcome of the projectStakeholder management is a proactive taskProject Mangers must determine all stakeholders and incorporate their needs into the projectChapter 2 Project Management Context Stakeholders are:Project ManagersCustomersPerforming Organizations, ownersSponsorTeamInternal/ExternalEnd UserSociety, citizensOthers: owner, funders, supplier, contractorChapter 2 Project Management ContextOrganizational Systems: Project based vs. Non-Project BasedProject Based derive revenues from performing projects for others (consultants, contractors),management by projectsNon-Project Based seldom have management systems designed to support project needs (manufacturing, financial services)

Chapter 2 Project Management ContextOrganizational Cultures and Styles: Entrepreneurial firms more likely to adopt highly participative Project Manager accept higher risk/rewardHierarchical firms less likely to adopt participative Project Manager take fewer risksChapter 2 Project Management ContextOrganizational StructuresFunctional (classical) marked by identifiable superiors. Staff grouped by specialty . Perceived scope of project limited by function (Engineering, HR). Typically have part-time Project ManagerProjectized Organization blend functional and projectized characteristics. Mix cross-department personnel with full-time Project MangerChapter 2 Project Management ContextProject Management SkillsGeneral Business Management (consistently producing results expected by stakeholders)Leading (establishing direction, aligning resources, motivating)Communicating (clear, unambiguous, and complete)Negotiating (conferring with others to reach an agreement)Problem Solving (definition and decision making)Distinguish causes and symptomsIdentify viable solutionsInfluencing Organization (understanding power and politics)Chapter 2 Project Management ContextSocioeconomic InfluencesStandards document approved that provides common, repeated use, rules and guidelinesCompliance is not mandatoryRegulations document that identifies products, services or characteristicsCompliance is mandatoryStandards often become de facto regulationsInternationalizationCultural InfluencesChapter 2 Project Management ContextOrganization Structure Pros and ConsProjectizedEfficient Organization No homeLoyalty Lack of ProfessionalismEffective Communication Duplication of functions, less efficient resource usageMatrixVisible Objectives not cost effectivePM Control More than 1 bossMore support More complex to controlUtilize scarce resources Tough resource allocationInformation distribution Competition of prioritiesCoordination Policies & ProceduresHome based Potential for conflict Chapter 2 Project Management ContextFunctional OrganizationSpecialists More emphasis on functions1 supervisor No career path in PMChapter 3 Project Management ProcessesProject Management requires active management of Project ProcessesSeries of actions that achieve a resultProject Management ProcessesDescribing and organizing the workProduct-Oriented ProcessesSpecifying and creating the productChapter 3 Project Management ProcessesProcess Groups:Initiating processes: recognizing a project or phase should beginPlanning processes: devising and maintaining a workable planExecuting processes: coordinating resources to execute the planControlling processes: ensuring project objectives are met; monitoring, correcting and measuring progressClosing processes: formalized acceptance

Chapter 3 Project Management ProcessesProcess Groups are linked by the results each producesProcess Groups are overlapping activities with various levels of intensityProcess Group interactions cross phases rolling wave planningProvides details of work to complete current phase and provide preliminary description of work for subsequent phasesIndividual processes have inputs, tools and techniques, and outputs (deliverables)Chapter 3 Project Management ProcessesInitiating and Planning ProcessesCommitting the organization to beginInitiation, High-level planning, CharterAmount of planning proportional to the scope of the project Core PlanningScope Planning written statementScope Definition subdividing major deliverables into more manageable unitsActivity Definition determine specific tasks needed to produce project deliverablesActivity Sequencing plotting dependenciesChapter 3 Project Management ProcessesCore Planning (continued)Activity Duration Estimating determine amount of work needed to complete the activitiesSchedule Development analyze activity sequences, duration, and resource requirementsResource Planning identify what and how many resources are needed to perform the activitiesCost Estimating develop resource and total project costsCost Budgeting allocating project estimates to individual work itemsProject Plan Development taking results from other planning processes into a collective document

Chapter 3 Project Management ProcessesPlanning/Facilitating Processes manage the interaction among the planning processesQuality Planning standards that are relevant to the project and determining how to meet standardsOrganizational Planning identify, document, and assigning project roles and responsibilitiesStaff Acquisition obtaining the human resourcesCommunications Planning determining rules and reporting methods to stakeholdersChapter 3 Project Management ProcessesPlanning/Facilitating Processes (continued)Risk Identification determining what is likely to affect the project and documenting these risksRisk Quantification evaluating risks and interactions to access the possible project outcomesRisk Response Development defining enhancement steps and change control measuresProcurement Planning determining what to buy and whenSolicitation Planning documenting product requirements and identifying possible sources

Chapter 3 Project Management ProcessesPlanning/Facilitating Processes (continued)Order of events:Scope StatementCreate Project TeamWork Breakdown StructureWBS dictionaryFinalize the teamNetwork DiagramEstimate Time and CostCritical PathScheduleBudgetProcurement PlanQuality PlanRisk Identification, quantification and response developmentChange Control PlanCommunication PlanManagement PlanFinal Project PlanProject Plan ApprovalKick offChapter 3 Project Management ProcessesExecuting ProcessesProject Plan Execution performing the activitiesComplete Tasks/Work PackagesInformation DistributionScope Verification acceptance of project scopeQuality Assurance evaluating overall project performance on a regular basis; meeting standardsTeam Development developing team and individual skill sets to enhance the projectProgress MeetingsChapter 3 Project Management ProcessesExecuting Processes (continued)Information Distribution making project information available in a timely mannerSolicitation obtaining quotes, bids, proposals as appropriateSource Selection deciding on appropriate suppliersContract Administration managing vendor relationshipsChapter 3 Project Management ProcessesControlling Processes needed to regularly measure project performance and to adjust project planTake preventive actions in anticipation of possible problemsChange Control coordinating changes across the entire project planScope Change Control controlling scope creepSchedule Control adjusting time and project schedule of activitiesChapter 3 Project Management ProcessesControlling Processes (continued)Cost Control managing project budgetQuality Control monitoring standards and specific project results; eliminating causes of unsatisfactory performancePerformance Reporting status, forecasting, and progress reporting scheduleRisk Response Control responding to changes in risk during the duration of the projectChapter 3 Project Management ProcessesClosing ProcessesAdministrative Closure generating necessary information to formally recognize phase or project completionContract Close-out completion and delivery of project deliverables and resolving open issuesProcurement AuditsProduct VerificationFormal AcceptanceLessons LearnedUpdate RecordsArchive RecordsRelease TeamChapter 3 Project Management ProcessesOverall ProcessesInfluencing the organizationLeadingProblem SolvingNegotiatingCommunicatingMeetingsChapter 3 Project Management ProcessesProject Selection TechniquesComparative Approach (similar projects)Benefit measurement methodConstrained Optimization (mathematical approach) Key aspect of scope verification is customer acceptanceOnly 26 % of projects succeedChapter 4 Project Integration ManagementProject Integration ManagementEnsures that the project processes are properly coordinatedTradeoffs between competing objectives and alternatives in order to meet stakeholder approvalProject Plan DevelopmentProject Plan ExecutionOverall Change ControlThese processes may occur repeatedly over the project durationHistorical Records are needed to perform project management well, they are inputs to continuous improvementFilesLessons LearnedActual CostsTime EstimatesWBSBenchmarksRisks

Chapter 4 Project Integration ManagementProject Plan DevelopmentUses outputs from other planning processes to create consistent document to guide project execution and controlIterated several timesDocuments planning assumptionsDocuments planning decisions that are chosenFacilitates communicationDefines key management reviewsProvides a baseline to track progress measurement and project controlChapter 4 Project Integration ManagementProject Plan Development InputsOther planning outputs: primarily the planning process outputs (WBS, base documents, application area inputs)Historical information verify assumptions, records of past project performanceOrganizational policies quality management, personnel administration, Financial controlsConstraints factors that limit performance, contractual provisions, budgetAssumptions risk factorsChapter 4 Project Integration ManagementTools & Techniques for Plan DevelopmentProject Planning Methodology any structured approach (software, templates, forms, start-up meetingsStakeholder Skills & Knowledge tap into plan development; use expertise for reasonablenessPMIS Out of the box approach to support all project aspects through closure

Chapter 4 Project Integration ManagementProject Plan Development OutputsProject Plan is a collection that changes over time as more information about the project becomes availableBaseline will change only in response to approved scope changeProject Plan includes some or all of the following:Project CharterProject Management approach or strategyScope statementWork Breakdown Structure (WBS)Budget, schedule, risksKey Staff, Major MilestonesChange Control Plan, Management and Communications Plan

Chapter 4 Project Integration ManagementProject Plan Components (continued)Cost Estimates, scheduled start dates and responsibility assignmentsPerformance measurement baselinesMajor milestones and target datesRequired StaffRisks, constraints and assumptionsSubsidiary management plans (scope, schedule)Open IssuesPending DecisionsChapter 4 Project Integration ManagementSupporting Details to the Project PlanOutputs from planning processesTechnical documentationBusiness requirements, specifications, and designsRelevant standardsAdditional information not previously knownChapter 4 Project Integration ManagementProject Plan ExecutionPrimary process for carrying out the project planMost costly aspect of project managementDirection of organizational resources and interfacesChapter 4 Project Integration ManagementProject Plan Execution Inputs:Project PlanSupporting DetailOrganizational PoliciesCorrective Action anything to bring expected performance in line with the project planChapter 4 Project Integration ManagementTools & Techniques for Plan ExecutionGeneral Management SkillsProduct Skills and Knowledge defined as part of planning, provided by staffingWork Authorization System formal procedure for sanctioning work to ensure completion written or verbal authorizationStatus review meetings regular exchanges of informationProject Management Information SystemOrganizational ProceduresChapter 4 Project Integration ManagementProject Plan Execution OutputsWork results the outcome of activities performed is fed into the performance reporting processChange Requests expand/shrink project scope, modify costs and schedule estimatesChapter 4 Project Integration ManagementOverall Change ControlInfluencing factors that create change to ensure beneficial results; ensure that change is beneficialDetermining that change has occurredManaging actual changes as they occurEvaluate impact of changeMeet with team to discuss alternativesMeet with management to present decisionChange control requiresMaintaining integrity of performance measurement baselines (project plan)Ensuring changes to scope are accurately recordedCoordinating changes across knowledge areas (scheduling, risk, cost, quality, etc.)Determine all factors that control change and pro-actively preventing the occurrence; evaluate the impact of change

Chapter 4 Project Integration ManagementInputs to Change ControlProject Plan baseline performancePerformance Reports issue tracking, risk managementChange Requests orally or written, externally or internally initiates, legally mandated or optional Chapter 4 Project Integration ManagementChange Control Tools & TechniquesAll Changes must be evaluated before a decision can be reachedChange Control System collection of formal procedures, paperwork, tracking systems, approval levelsChange Control Board decision making authorityConfiguration Management documented procedure to apply technical and administrative directionID and document functional and physical characteristicsControl changes to these characteristicsRecord and report change and implementation statusAudit items and system to verify requirementsChapter 4 Project Integration ManagementChange Control Tools & TechniquesPerformance Measurement earned value, plan variance analysisAdditional Planning revised cost estimates, modify activity sequences, plan adjustmentsProject Management Information SystemChange Control System may haveChange Control PlanChange Control BoardChange Control Procedures, Corrective Action plansPerformance Statistics, Reports, Change formsSpecification reviews, Demonstrations, Testing, MeetingsConfiguration ManagementChapter 4 Project Integration ManagementChange Control OutputsProject Plan UpdatesCorrective ActionsLessons Learned variance causes and reasoning documented for historical purposesChapter 4 Project Integration ManagementConfiguration ManagementRigorous Change Management as it relates to scopeSubset of the change control systemWork Authorization SystemControls gold plating; defines what task is/is not MeetingsMost are inefficient; keep minutesStatus can be determined without meetingChapter 4 Project Integration ManagementLessons LearnedProject is not complete until a Lessons Learned is completedWhat have we done, how can we do it betterTechnical Aspects of the projectProject Management (WBS, plans, etc.)Overall Management (communications, leadership)Best to have whole team complete and made available Also called Post MortemChapter 4 Project Integration ManagementIntegration is a result of need for communication within a projectPrimary responsibility to decide what changes are necessary is ManagementProject Managers must pro-actively define and solve problems before reporting to superiorsChapter 5 Project Scope ManagementProject Scope ManagementProcesses required to ensure that the project includes all, and only, work requiredDefining what is/is not included in the projectProject scope work that must be done measured against project planProduct scope features and functions included in the product or service measured against requirementsChapter 5 Project Scope ManagementInitiation Inputs:Product Description characteristics of the product/service that the project was to createLess detail in early phases, more comprehensive in latterRelationship between product/service and business needShould support later project planningInitial product description is usually provided by the buyerStrategic Plan supportive of the organization's goalsChapter 5 Project Scope ManagementInitiation Inputs (continued)Project Selection Criteria defined in terms of the product and covers range of management concerns (finance, market)Historical Information results of previous project decisions and performance should be consideredChapter 5 Project Scope ManagementTools & Techniques for InitiationProject Selection Methods:Benefit measurement models comparative approaches, scoring models, economic modelsMurder BoardsPeer ReviewScoring ModelsEconomic ModelsBenefits compared to costsConstrained operation models programming mathematicalLinear ProgrammingInteger ProgrammingDynamic ProgrammingMulti-objective programmingChapter 5 Project Scope ManagementTools & Techniques for InitiationProject Selection Methods:Decision models generalized and sophisticated techniquesExpert judgmentBusiness Units with specialized skillsConsultantProfessional and Technical AssociationsIndustry GroupsDelphi Technique obtain expert opinions on technical issues, scope of work and risksKeep experts identities anonymousBuild consensusChapter 5 Project Scope ManagementOutputs from Initiation:Project Charter formally recognizes project, created by senior manager, includes:Business need/Business CaseProduct description & titleSigned contractProject Manager Identification & Authority levelSenior Management approvalProjects Goals and Objectives - Constraints factors that limit project management teams optionsAssumptions factors that are considered true for planning purposes. Involve a degree of risk Chapter 5 Project Scope ManagementScope Planning process of developing a written statement as basis for future decisionsCriteria to determine if the project or phase is successfulScope Planning Inputs:Product descriptionProject CharterConstraintsAssumptionsChapter 5 Project Scope ManagementScope Planning Tools & TechniquesProduct Analysis - - developing a better understanding of the product of the projectCost/Benefit Analysis estimating tangible/intangible costs and returns of various project alternatives and using financial measures (R.O.I.) to assess desirabilityAlternatives Identification generate different approaches to the project; brainstorming Expert JudgmentChapter 5 Project Scope ManagementScope Planning OutputsScope Statement documented basis for making project decisions and confirming understanding among stakeholders. Includes:Project justification business need, evaluating future trade-offsProject Product summary of project descriptionProject Deliverables list of summary of delivery items marking completion of the projectProject Objectives quantifiable criteria met for success. Addresses cost, schedule and metrics unqualified objectives indicate high risk (customer satisfaction)Chapter 5 Project Scope ManagementScope Planning Outputs (continued)Supporting detail includes documentation of all assumptions and constraintsScope Management Plan how project scope is managed, change control procedure, expected stability, change identification and classificationControl what is/is not in the project; prevents delivering extra benefits to the customer that were not specified/required

Chapter 5 Project Scope ManagementScope Definition subdividing major deliverables into smaller, manageable componentsImprove accuracy of cost, time, and resource estimatesDefine a baseline for performance measurementClear responsibility assignmentsCritical to project success reduces risk of higher cost, redundancy, time delays, and poor productivityDefines what you are doing; WBS is the toolChapter 5 Project Scope ManagementScope Definition Inputs:Scope StatementConstraints consider contractual provisionsAssumptionsOther Planning OutputsHistorical Information

Chapter 5 Project Scope ManagementScope Definition Tools & TechniquesWork Breakdown Structure templates from previous projectsDecomposition subdividing major deliverables into manageable components:Major elements project deliverables and project management approachDecide cost and duration estimates are appropriate at level of detailConstituent elements tangible verifiable results to enable performance management, how the work will be accomplishedVerify correctness of decompositionAll items necessary and sufficient?Clearly and completely defined?Appropriately scheduled, budgeted, assigned?

Chapter 5 Project Scope ManagementScope Definition OutputsWork Breakdown Structure (WBS) a deliverable-oriented grouping of project assignments that organizes and defines the scope of the project Each descending level represents further detail; smaller and more manageable piecesEach item is assigned a unique identifier collectively known as code of accountsWork element descriptions included in a WBS dictionary (work, schedule and planning information) Other formats:Contractual WBS seller provides the buyerOrganizational (OBS) work elements to specific org. unitsResource (RBS) work elements to individualsBill of Materials (BOM) hierarchical view of physical resourcesProject (PBS) similar to WBSChapter 5 Project Scope ManagementScope Definition OutputsWork Breakdown Structure (WBS)First Level is commonly the same at the Project Life Cycle (requirements, design, coding, testing, conversion and operation)First level is completed before the project is broken down furtherEach level of the WBS is a smaller segment of level aboveWork toward the project deliverablesBreak down project into tasks thatAre realistically and confidently estimableCannot be logically divided furtherCan be completed quickly (under 80 hours rule of thumb)Have a meaningful conclusion and deliverableCan be completed without interruptionProvides foundation for all project planning and controlChapter 5 Project Scope ManagementScope Definition OutputsWork Breakdown Structure (WBS) - BenefitsPrevent work slippageProject team understands how their tasks fit into the overall project and their impact upon the projectFacilitates communication and cooperation between project team and stakeholdersHelps prevent changesFocuses team experience into what needs to be done results in higher qualityBasis and proof for estimating staff, cost and timeGets team buy-in, role identificationGraphical picture of the project hierarchyIdentifies all tasks, project foundationChapter 5 Project Scope ManagementWBS phrasesGraphical hierarchy of the projectIdentifies all tasks Foundation of the projectVery importantForces thought of all aspects of the projectCan be re-used for other projects

Chapter 5 Project Scope ManagementScope Definition OutputsWork Breakdown Structure (WBS) DictionaryDesigned to control what work is done and whenAlso known as a task descriptionPuts boundary on what is included in a task and what is not includedChapter 5 Project Scope ManagementScope Verification InputsWork results partially/completed deliverables, costs to dateProduct documentation description available for review (requirements)Scope Verification Tools & TechniquesInspection measuring, examining, testing to determine if results conform to requirementsScope Verification OutputsFormal acceptance documentation identifying client and stakeholder approval, customer acceptance of effortsChapter 5 Project Scope ManagementScope Change Control:Influencing factors to ensure that changes are beneficialDetermining scope change has occurredManaging changes when they occurThoroughly integrated with other control processesChapter 5 Project Scope ManagementScope Change Control Inputs:Work Breakdown StructurePerformance Reports- issues reportedChange Requests expansion/shrink of scope derived from :External events (government regulations)Scope definition errors of product or projectValue adding change new technologyScope Management PlanChapter 5 Project Scope ManagementScope Change Control Tools & TechniquesScope Change Control System defines procedures how scope change can occurAll paperwork, tracking systems, approval levelsIntegrated with overall change control proceduresPerformance Measurement determine what is causing variances and corrective actionsAdditional Planning Chapter 5 Project Scope ManagementScope Change Control Outputs:Scope Changes fed back through planning processes, revised WBSCorrective Actions Lessons Learned cause and reasoning for variances documented for historical purposesChapter 5 Project Scope ManagementManagement By Objectives (MBO)Philosophy that has 3 steps:Establish unambiguous and realistic objectivesPeriodically evaluate if objectives are being metTake corrective actionProject Manager must know that if project is not aligned or support corporate objectives, the project is likely to lose resources, assistance and attention.MBO only works if management supports it Chapter 6 Project Time ManagementProject Time ManagementProcesses required to ensure timely completion of the projectNo consensus concerning differences between activities and tasksActivities seen as composed of tasks most common usageOther disciplines have tasks composed of activitiesChapter 6 Project Time ManagementActivity Definition: identifying and documenting specific activities to produce project deliverables identified in the WBSMust be defined to meet the project objectivesChapter 6 Project Time ManagementActivity Definition InputsWBS primary inputScope Statement project justification & project objectivesHistorical Information ConstraintsAssumptions Chapter 6 Project Time ManagementActivity Definition Tools & TechniquesDecomposition outputs are expressed as activities rather than deliverablesTemplates reuse from previous projects

Chapter 6 Project Time ManagementActivity Definition OutputsActivity List all to be performed; extension to the WBS and includes description to ensure team members understand work to be performedSupporting Detail organized as needed and include all assumptions and constraintsWBS Updates identify missing deliverables and clarify deliverable descriptions. WBS updates often called refinements; more likely using new technologies in project Chapter 6 Project Time ManagementActivity Sequencing identifying and documenting interactive dependencies among activities. Support later development of a realistic scheduleProject Management software often usedChapter 6 Project Time ManagementActivity Sequencing Inputs:Activity ListProduct Description product characteristics often affect activity sequencing Mandatory Sequencing physical limitations, hard logic, prototypes needed; inherent in nature of work being doneDiscretionary Dependencies defined by project management team; best practices or unusual aspects of project soft logic, preferred logic, preferential logicExternal Dependencies relationship between project activities and non-project activities (company policies, procurement, etc.)ConstraintsAssumptions

Chapter 6 Project Time ManagementNetwork DiagramsShows how the project tasks will flow from beginning to endProves how long the project will take to completeTakes project tasks from low levels of WBS and placing them into their order of completion (beginning to end)

Chapter 6 Project Time ManagementActivity Sequencing Tools & TechniquesPrecedence Diagramming Method (PDM) constructing network diagram using nodes to represent activities and arrows to indicate dependencies; also called Activity On Node (AON)Most project management software usesIncludes 4 types of dependencies:Finish to Start from activity must finish before to activity can begin; most commonly used Finish to Finish from activity must finish before the next may finishStart to Start from activity must start before next to activity can startStart to Finish task must start before next activity can finishUse caution with last 3 techniques - logical relationships often not consistently implemented with project management softwareChapter 6 Project Time ManagementActivity Sequencing Tools & Techniques (continued)Arrow Diagramming Method (ADM) uses arrows to represent activities and connecting at nodes to illustrate dependenciesAlso called Activity On Arrow (AOA)Only uses finish to start dependenciesPERT and CPM only can be drawn using AOA

Chapter 6 Project Time ManagementActivity Sequencing Tools & Techniques (continued)Conditional diagramming methodsGERT (Graphical Evaluation and Review Technique)System Dynamic ModelsAllow for non-sequential activities (loops) or conditional branches not provided by PDM or ADM methodsChapter 6 Project Time ManagementActivity Sequencing Tools & Techniques (continued)Network Templates standardized networks can be used. Composed of subnets, or fragnetsSubnets are several nearly identical portions of a network (floors on a building, clinical trials, program modules)Useful for several identical processes (clinical trials, programming modules).Chapter 6 Project Time ManagementActivity Sequencing Outputs:Project Network Diagram schematic display of project activities and relationships (dependencies). Should be accompanied by a summary narrative that describes the diagram approachActivity List UpdatesChapter 6 Project Time ManagementActivity Duration EstimatingInvolves assessing number of work periods needed to complete identified activities Requires consideration of elapsed time, calendars, weekends, and day of week work startsChapter 6 Project Time ManagementActivity Duration Estimating Inputs:Activity ListsConstraintsAssumptionsResource Requirements amount of labor assigned to activityResource Capabilities human and material resources, expertiseHistorical InformationProject Files, or records of previous project resultsCommercial Duration Estimates useful when durations are not driven by actual work (approval periods, material resources)Project Team KnowledgeChapter 6 Project Time ManagementActivity Duration Estimating Tools & TechniquesExpert Judgment guided by historical information should be used whenever possible; high risk without expertise avail.Simulation using different sets of assumptions (Monte Carlo Analysis) to drive multiple durationsAnalogous Estimating top down estimating use actual, similar, previous known durations as basis for future activity duration. Used when limited knowledge is available. Form of expert judgmentChapter 6 Project Time ManagementActivity Duration Outputs:Activity Duration Estimates quantitative assessments of work periods to complete an activity. Should indicate a range +/- of possible resultsBasis of Estimates all assumptions should be documentedActivity List Updates Chapter 6 Project Time ManagementSchedule DevelopmentDetermining start and finish dates for project activitiesWithout realistic dates, project unlikely to be finished as scheduledSchedule development process often iterates as more information becomes available (process inputs)Chapter 6 Project Time ManagementSchedule Development Inputs:Project Network DiagramActivity Duration EstimatesResource RequirementsResource Pool Description availability patterns; shared resources are highly variableCalendars define eligible work periodsProject Calendars affect all resourcesResource Calendars affect specific resource pools or individuals

Chapter 6 Project Time ManagementSchedule Development Inputs (continued):ConstraintsImposed Dates may be requiredKey events or milestones are initially requested and become expected during projectAssumptionsLead and Lag Time dependencies may specify time in order to satisfy relationship (example 2 weeks to receive order)Chapter 6 Project Time ManagementSchedule Development Tools & TechniquesMathematical Analysis calculating theoretical early/late finish and start dates without regard for resource pool limitations; indicate time periods which activity should be scheduled given resource limits and other constraints:Critical Path Method (CPM) single early/late start and finish date for all activities. Based on specified, sequential network and single duration estimate. Calculates float to determine flexibilityGraphical Evaluation and Review Technique (GERT) probabilistic treatment of network and activity duration estimates Program Evaluation and Review Technique (PERT)- sequential network and weighted average duration to calculate project duration differs from CPM by using mean (expected value) instead of most-likely estimate in CPM Chapter 6 Project Time ManagementSchedule Development Tools & TechniquesCritical Path Method: refers to estimating based on one time estimate per activityOne time estimate per task (Most Likely)Emphasis on controlling cost and leaving schedule flexibleDrawn using AOA diagramsCan have dummy taskPERT (Program Review and Estimating Technique)3 Time estimates per activity OptimisticPessimisticMost LikelyEmphasis on meeting schedule, flexibility with costsDrawn on AOA diagramsCan have dummy tasksChapter 6 Project Time ManagementSchedule Development Tools & TechniquesMonte Carlo AnalysisUses a computer with PERT values and network diagramTellsProbability of completing a project on any specific dayProbability of completing a project for any specific amount of costProbability of any task actually being on the critical pathOverall Project RiskSuggests that Monte Carlo simulation will create a project duration that is closer to reality than CPM or PERTChapter 6 Project Time ManagementSchedule Development Tools & Techniques (continued)Duration Compression look to shorten project schedule without affecting scopeCrashing cost and schedule trade-offs to determine greatest amount of compression for least incremental cost often results in higher costsFast Tracking performing activities in parallel that normally would be sequenced often results in re-work and usually increases riskSimulationChapter 6 Project Time ManagementSchedule Development Tools & Techniques (continued)Resource Leveling Heuristics leveling resources that apply to critical path activities a.k.a. resource constrained scheduling when limitation on quantity of available resources; sometimes called Resource Based Method often increases project durationProject Management SoftwareChapter 6 Project Time ManagementSchedule Development Tools & Techniques (continued)Project Mangers roleProvide the team with the necessary information to properly estimate the taskComplete a sanity check of the estimateFormulate a reserveProject Team should be involved; determine task estimatesHistorical RecordsGuessesActual Costs BenchmarksCPM and PERTChapter 6 Project Time ManagementSchedule Development Tools & TechniquesCritical Path Method: longest path through a network diagram and determines the earliest completion of the projectProves how long the project will takeIndicates tasks that need most monitoringAlmost always have no slackChapter 6 Project Time ManagementSchedule Development Outputs:Project Schedule includes planned start and finish dates for each activity; remains preliminary until resources assignments are approved. Usually in following formats:Project Network Diagrams (with date information added) show logical and critical path activitiesBar or Gantt charts activity start and end dates, expected durationsMilestone Charts identifies key deliverables and interfaces Time-scaled network diagrams blend of project network and bar charts

Chapter 6 Project Time ManagementSchedule Development Outputs (continued):Supporting Detail all assumptions and constraints. May also include:Resource requirement by time period (resource histogram)Alternative schedules (best/worst case)Schedule reserve/risk assessmentsSchedule Management Plan how updates are managedResource requirement updates leveling and activity impactChapter 6 Project Time ManagementSchedule Control:Influencing factors which create schedule changes to ensure changes are beneficialDetermining that schedule has changedManaging actual changes as they occurInputs to Schedule ControlProject Schedule baseline approved, measure against project performancePerformance Reports planned dates met, issuesChange RequestsSchedule Management PlanChapter 6 Project Time ManagementSchedule Control Tools & TechniquesSchedule Change Control System defines procedures for schedule changes, paperwork, approval, tracking systemsPerformance Measurement assess magnitude of variations to baseline; determine if corrective action is neededAdditional Planning Project Management SoftwareChapter 6 Project Time ManagementSchedule Control Outputs:Schedule Updates any modifications, stakeholder notificationRevisions change scheduled start and finish dates generally in response to scope changes. Re-baselining may be needed in drastic situationsCorrective Action re-align performance with project planLessons LearnedChapter 6 Project Time ManagementKey knowledge points not in PMBOKNeed to know manual calculations of network diagramsCreated after project charter and WBS (task estimates and dependencies are determined)Mandatory dependencies (Hard Logic) inherent in nature of workDiscretionary dependencies (Soft Logic) based on experience, desire or resultsExternal dependencies based on needs and desires of organizations outside the projectChapter 6 Project Time ManagementMethods to draw network diagramsActivity on Node (AON) or Precedence Diagramming Method (PDM)Boxes represent tasksArrows show task dependencies4 types of task relationshipsFinish to Start (task must finish before next can start)Finish to Finish (task must finish before next can finish)Start to Start (task must start before next can start)Start to Finish (task must start before the next can finish)No dummy tasks used

Chapter 6 Project Time ManagementMethods to draw network diagramsActivity on Arrow (AOA or Arrow Diagramming Method (ADM)Arrows used to represent tasksOnly Finish to Start relationships are usedMay use dummy tasks (show dependencies)PERT and CPM estimating techniques can only be drawn using AOACPM (Critical Path Method) estimating based on one time estimate per activity (the most likely time estimate)Emphasizes controlling cost and allowing schedule flexibilityCan have dummy tasksChapter 6 Project Time ManagementMethods to draw network diagramsActivity on Arrow (AOA or Arrow Diagramming Method (ADM) continued:PERT (Program Evaluation and Review technique)3 time estimates per activity: Optimistic (O), Most Likely (M), Pessimistic (P)Emphasizes meeting schedule, flexibility with costCan have dummy tasksChapter 6 Project Time ManagementMethods to draw network diagramsPERT (Program Evaluation and Review technique)Estimating based on 3 formulas:PERT Duration: (P + 4M + O)/6Standard Task Deviation: (P O)/6Task Variance:

Total project estimate:Add up all Optimistic, Most Likely and Pessimistic values of the critical path tasks and apply P + 4M + O/6 Total project variance (+/-):Add up the individual task variances and take the square root of the value. Use the value as a +/- figure to compute the Optimistic and Pessimistic values. The total project estimate will serve as the basis.

[P O]2 6Chapter 6 Project Time ManagementMonte Carlo Simulation:Uses a computer with PERT values (P, M, O) and a network diagram but does not use the PERT formulaIndicatesProbability of completing project on a specific dayProbability of completing project for any specific amount of costProbability of any task actually being on critical pathOverall project risk

Chapter 6 Project Time ManagementEstimating techniques in general:Should be performed by entire project teamProject manager needs to provide information to allow team to create estimates; sanity check; formulate reserveEstimates are:Guesses, Historical Records, Actual Costs, Benchmarks, CPM, PERTCritical paths determines the earliest completion date and identifies tasks that need monitoringCan be obtained by CPM, PERT and Monte Carlo estimating techniques

Chapter 6 Project Time ManagementKey Definitions:Slack (Float): the amount of time a task can be delayed without delaying the entire project. Tasks on critical path have no slack. Slack is calculated by the difference between Early Start and Late Start of a taskFree Slack (Float): the amount of time a task can be delayed without delaying the early start date of its successorTotal Slack (Float): the amount of time a task can be delayed without delaying the project completion dateLag: inserted waiting time between tasks

Chapter 6 Project Time ManagementGeneral Comments:Projects can have more than 1 critical path (increases risk) and can involve dummy tasksNegative float indicates that you are behindResource Leveling involves possibly letting schedule and cost slipHeuristics just means rule of thumb e.g. 80/20 ruleSchedules are calendar based makes this different than a time estimateBar Chart a.k.a. Gantt chart (track progress, report to entire team including stakeholders, control tool)Network Diagram (to show task inter-dependencies, show project organization, basis for project control)Milestone chart (report to Senior management, shows major events)

Chapter 6 Project Time ManagementGeneral Comments:To shorten project schedule examine the critical pathCrashing add more resources to the critical path tasksUsually results in increased costFast Tracking performing tasks in parallelCan result in re-work and increased riskBest to select method that has least impact on the project (is the importance on cost, risk or schedule?)

Chapter 6 Project Time ManagementGeneral Comments:Bar (Gantt) ChartsWeak Planning Tool, effective progress and reporting toolDoes not show interdependencies of tasksDoes not help organize the project more effectivelyNetwork Diagrams (PERT, CPM, PDM)Shows task interdependenciesAids in effectively planning and organizing workProvides a basis for project controlMilestone ChartsOnly shows major eventsGood for reporting to management and customerFlow ChartsDepicts workflow and not commonly used for project management

Chapter 6 Project Time ManagementGeneral Comments:Free Slack (Float) amount of time a task can be delayed without delaying the early start date of its successorTotal Slack (Float) amount of time a task can be delayed without delaying the project completion date

Lag inserted waiting time between tasksResource Leveling level peaks of resource usage; stable number of resources allows schedule and cost slip in favor of leveling resourcesHeuristic rule of thumb (80/20 rule)

Chapter 7 Project Cost ManagementProject Cost ManagementEnsure that the project is completed within budgetConcerned with cost of resources needed to complete activities; consider effect of project decisions on cost of using product life-cycle costingMost prospective financial impact of using the product is outside the project scopeConsider information needs of stakeholders, controllable and uncontrollable costs (budget separately for reward and recognition systems)Chapter 7 Project Cost ManagementProject Cost ManagementEstimating should be based on WBS to improve accuracyEstimating should be done by the person performing the workHaving historical records is key to improving estimatesCosts (schedule, scope, resources) should be managed to estimatesA cost (schedule, scope, baseline) should be kept and not changedPlans should be revised as necessary during completion of workCorrective action should be taken when cost problems (schedule, scope and resources) occur.Chapter 7 Project Cost ManagementResource Planning:Determining what physical resources and quantities are needed to perform workInputs to Resource Planning:Work Breakdown StructureHistorical InformationScope Statement justification & objectivesResource Pool Description what resources are potentially available for resource planningOrganizational Policies staffing, procurementChapter 7 Project Cost ManagementInputs to Resource Planning:Work Breakdown StructureNetwork DiagramScheduleRisksHistorical InformationScope Statement justification & objectivesResource Pool Description what resources are potentially available for resource planningOrganizational Policies staffing, procurementChapter 7 Project Cost ManagementResource Planning Tools & TechniquesExpert JudgmentAlternatives IdentificationResource Planning Outputs:Resource Requirements what type & how many resources are needed for each activity in the Work Breakdown StructureChapter 7 Project Cost ManagementCost Estimating:Develop approximate costs of resourcesDistinguish estimating from pricingEstimating likely amountPricing business decisionIdentify alternatives and consider realigning costs in phases to their expected savingsChapter 7 Project Cost ManagementCost Estimating Inputs:Work Breakdown StructureResource RequirementsResource Rates (if known)Activity Duration EstimatesHistorical Information (project files, commercial cost databases, team knowledgeChart Of Accounts coding structure for accounting; general ledger reportingChapter 7 Project Cost ManagementCost Estimating Tools & TechniquesAnalogous Estimating top down; using actual costs from previous project as basis for estimate Reliable when previous projects are similar and individuals have expertise form of expert judgmentParametric Modeling uses project characteristics in mathematical models to predict costs (e.g.building houses)Reliable when historical information is accurate, parameters are quantifiable, and model is scalable2 types: Regression analysis, Learning Curve Bottom Up Estimating rolling up individual activities into project total smaller work activities have more accuracy - Computerized tools spreadsheets, software Chapter 7 Project Cost ManagementCost Estimating Tools & TechniquesPros and ConsAnalogous Estimating Quick - Less AccurateTasks dont need to be identified Estimates prepared with little detail and understanding of projectLess costly Requires considerable experience to do wellGives PM idea of management expectations Infighting at high levels of organizationOverall project costs are capped Difficult for projects with uncertaintyChapter 7 Project Cost ManagementCost Estimating Tools & TechniquesPros and ConsBottom Up EstimatingMore Accurate Takes time and expenseGains buy-in from the team Tendency for team to pad estimatesBased on detailed analysis of project Requires that project be defined and understoodProvides a basis for monitoring and control Team infighting to get biggest piece of pieChapter 7 Project Cost ManagementOutputs from Cost EstimatingCost estimates quantitative assessments of likely costs of resources required to complete tasksFor all resources of the project (labor, materials, supplies, inflation allowance, reserve)Expressed in units of currencySupporting DetailDescription of scope (reference to the WBS)Documentation how estimate was developedIndication of range of possible resultsAssumptionsCost Management Plan how cost variances will be managedCost Risk: associated to seller for Fixed Price; associated to buyer for Time and Materials budgetChapter 7 Project Cost ManagementCost Budgeting Involves allocation of total estimate to individual work to establish a cost baseline to measure performanceCost Budgeting InputsCost EstimateWork Breakdown StructureProject Schedule includes planned start and finish dates for items costs are allocated toNeeded to assign costs during the time period when the actual cost will be incurredChapter 7 Project Cost ManagementCost Budgeting Tools & Techniques same as Cost Estimating Tools and TechniquesOutputs from Cost BudgetingCost Baseline time phased budget to measure and monitor cost performanceDeveloped by summing estimated costs by period (S curve of values vs. time)Larger projects have multiple baselines to measure different aspects of cost performanceChapter 7 Project Cost ManagementCost ControlConcerned with influencing factors that create changes to the cost baseline that are beneficialDetermining that the cost baseline has changedManaging actual changes as they occurMonitor cost performance to detect variancesRecord all appropriate changes accurately in the cost baselinePreventing incorrect, unauthorized changes being included in the cost baselineInforming stakeholders of authorized changes Determine the whys of positive and negative variancesIntegrated will all other control processes (scope, change, schedule, quality)Chapter 7 Project Cost ManagementInputs to Cost ControlCost BaselinePerformance Reports meet, exceed budget50/50 Rule task is considered 50% complete when it begins and gets credit for remainder 50% only when completed20/80 Rule - task is considered 20% complete when it begins and gets credit for remainder 80% only when completed0/100 Rule task only credited when fully completedChange RequestsCost Management PlanTools & Techniques of Cost ControlCost Change Control System defines the procedures by which the cost baseline may be changedPerformance Measurement assess magnitude of cost variations (Earned Value Analysis) and what is causing the varianceAdditional Planning examine alternativesComputerized Tools forecast planned costs, track actual costs, forecast effect of cost changesChapter 7 Project Cost ManagementCost Control OutputsRevised Cost EstimateModifications to cost information; require stakeholder approval and adjustments to other project areasBudget Updates changes to approved cost baseline; revised in response to scope changesCorrective ActionEstimate at completion (EAC) forecast of total expendituresActual to date plus remaining budget modified by a factor (cost performance index)Current variances are seen to apply to future variancesActual to date plus new estimate for remaining workOriginal estimates are flawed, or no longer relevantActual to date plus remaining budgetCurrent variances are typical and similar variances will not occur in the futureLessons Learned

Chapter 7 Project Cost ManagementEarned Value AnalysisIntegrates cost, schedule and scopeBetter that comparing projected vs. actual because time and cost are analyzed separatelyTerms:BCWS Budgeted Cost of Work Scheduled (how much work should be done)BCWP Budgeted Cost of Work Performed a.k.a. Earned Value (how much work is budgeted, how much did we budget)ACWP Actual Cost of Work Performed (how much did the completed work cost)

Chapter 7 Project Cost ManagementEarned Value AnalysisTerms:BAC Budget at Completion (how much did you budget for the total job)EAC Estimate at Completion (what do we expect the total project to cost)ETC Estimate to Completion (how much more do we expect to spend to finish the job)VAC Variance at Completion (how much over/under budget do we expect to be)

Chapter 7 Project Cost ManagementEarned Value AnalysisFormulasVariance (Plan Actual)Cost Variance (CV): BCWP ACWP; negative is over budgetSchedule Variance (SV): BCWP BCWS; negative is behind scheduleCost Performance Index (CPI): BCWPACWPI am only getting x out of every $BCWPACWPChapter 7 Project Cost ManagementEarned Value AnalysisFormulasSchedule Performance Index (SPI): BCWP BCWS

I am only progressing x % of the planned rateEstimate at Completion (EAC): BAC CPI

As of now we expect the total project to cost x$ Estimate to Complete (ETC): EAC ACWP; how much will it cost from now to completionVariance at Completion: BAC EAC; when the project is over how much more or less did we spend (most common way of calculating EVABCWPBCWSBACCPIChapter 7 Project Cost ManagementEarned Value AnalysisBCWP comes first in most formulasIf it is a variance, BCWP comes firstIf it is an index, BCWP is divided byIf the formula relates to cost, use AWCPIf the formula related to schedule, use BWCPNegative is bad; positive results are goodETC refers to this point on; EAC refers to when job is completed

Chapter 7 Project Cost ManagementAccuracy of EstimatesOrder of Magnitude Estimate: -25% - 75%; usually made during Initiation PhaseBudget Estimate: -10% - 25%; usually made during the Planning phaseDefinitive Estimate: -5% - 10%; usually made during the Planning phase

Chapter 7 Project Cost ManagementAccounting StandardsNot usually part of the examPresent Value (value today of future cash flows):PV = FV (1 + r) NFV = Future ValueR = Interest RateN = Number of time periods

Chapter 7 Project Cost ManagementAccounting StandardsNet Present Value: total benefits (income or revenue) less the costs. NPV is the sum of each present value of each income/revenue item Internal Rate of Return (IRR): company may select project based on highest IRRPayback Period: number of time periods it takes to recover the investment in the project before generating revenuesBenefit Cost Ratio (BCR): compares costs to the benefits of different projectsGreater than 1 means benefits are greater than costsLess than 1 means costs are greater than benefitsOpportunity Cost: opportunity given up by selecting one project over another

Chapter 7 Project Cost ManagementAccounting StandardsSunk Costs: expended costs. Sunk costs should not be considered when determining to continue with a troubled projectLaw of Diminishing Returns: the more that is put in the less of an outcome is receivedWorking Capital: current assets current liabilitiesVariable Cost: costs that change with the amount of production or the amount of work (materials, wages)Fixed Cost: non-recurring costs that do not changeDirect Cost: directly attributable to project work (travel, wages, materials)Indirect Cost: overhead items or costs for the benefit of more than one project (taxes, fringe benefits)

Chapter 7 Project Cost ManagementAccounting StandardsDepreciation: assets lose value over timeStraight Line depreciation: same amount is taken each yearAccelerated Depreciation: 2 formsDouble Declining BalanceSum of the Years DigitsLife Cycle Costing: includes operations and maintenance phasesValue Analysis: find a less costly way to do same work

Chapter 7 Project Cost ManagementAccounting StandardsMake or Buy decisions at Development (Planning) phase, not conceptual phaseProject Objectives are not necessarily needed to fund projectProject Definition focus on end product initially; costs and benefits will be evaluated later25% of project lifecycle expended at end of planningNo guarantees; only most likely resultsChapter 7 Project Cost ManagementAccounting StandardsLine of Balance charts are used for manufacturingNegative Float the late start date is earlier than the early start dateValue Engineering/analysis does not trade performance for costProspectus profitability and technical feasibility used to solicit fundingChapter 7 Project Cost ManagementAccounting StandardsDefinitive Estimate most precise/accurate estimate for determining project costsManagement Reserve over time PM wants no change to reserve; customers wants $ backCost and Schedule Data predicts future performanceROI, Nest Present Value and Discounted Cash Flow all can be used to measure total income vs. total $ expendedUndistributed budget budget that contains approved scope changes but are not planned yetDepreciation is not a measurement of profitabilityPay Back Period - # of periods required to recover the initial investmentChapter 8 Project Quality ManagementProject Quality ManagementProcesses required to ensure that the project will satisfy the needs for which it was designedIncludes all activities of the overall management function that determine the quality policy, objectives, and responsibilities. These are implemented by quality planning, quality control, quality assurance, and quality improvementChapter 8 Project Quality Management3 major processes:Quality Planning identifying quality standards that are relevant to the project (Plan); Project Manager, Project OwnerQuality Assurance evaluating overall project performance to provide confidence that project will satisfy relevant quality standards (Implement or Execution); Project TeamQuality Control monitoring specific results to comply with quality standards and eliminating unsatisfactory performance causes (Check or Control); Project Manager, Project TeamCompatible with ISO 9000 and 10000 seriesProprietary and non-proprietary approaches (total quality managementMust address the management of the project and the product of the project Chapter 8 Project Quality ManagementQuality the totality of characteristics of an entity that bear on its ability to satisfy stated or implied needsCritical aspect is to turn implied needs into stated needs through project scope managementDo not confuse with grade category or rank given to entities having the same functional use but different requirements for qualityCustomer satisfaction conformance to specifications (must produce what is stated) and fitness for use (must satisfy real needs)Prevention avoid mistakes vs. cost of correctionManagement responsibility requires participation of team; responsibility of management to provide resourcesProcesses within phases plan-do-check-act cycleRecognize that the investment in product quality improvements may be borne by the performing organization since the project may not last long enough to reap rewardChapter 8 Project Quality ManagementQuality PlanningIdentify quality standards are relevant and how to satisfyInputs to Quality PlanningQuality Policy the overall intentions and direction of an organization with regard to quality as expressed by managementScope StatementProduct DescriptionStandards and RegulationsOther Process Outputs processes from other knowledge areas (procurement planning)Chapter 8 Project Quality ManagementTools &Techniques for Quality PlanningBenefit/Cost Analysis consider trade-offs, benefit is less rework; cost is expense of project management activitiesBenchmarking comparing actual or planned practices to those of other projectsFlowchartingCause and effect diagramming (Ishikawa or fishbone diagrams) illustrate how causes relate to potential problems or effectsSystem or Process flowcharts show how various elements of the system interrelateHelps anticipation of what and where quality problems may occurDesign of Experiments analytical technique which defines what variables have most influence of the overall outcomeCost and schedule tradeoffsChapter 8 Project Quality ManagementOutputs from Quality PlanningQuality Management Plan describes how team will implement its quality policy; describes the project quality system organizational structures, responsibilities, procedures, processes and resources needed to implement quality managementOperational Definitions defines how an item is measured by the quality control process. Also known as Metrics.Checklists structured tool used to verify that a set of required steps has been performedInputs to other processes may identify a need for further activity in another areaChapter 8 Project Quality ManagementQuality AssuranceAll planned and systematic activities implemented within the quality system to provide confidence that the project will satisfy quality standardsInputs to Quality AssuranceQuality Management PlanResults of quality control measurements (testing)Operational definitionsChapter 8 Project Quality ManagementTools & Techniques for Quality AssuranceQuality planning tools & techniquesQuality Audits structured review of quality management activities to identify lessons learnedOutputs from Quality AssuranceQuality improvements taking action to increase the effectiveness and efficiency of the project to provide added benefits to the stakeholdersMost likely will involve change controlChapter 8 Project Quality ManagementQuality Control monitoring specific results to determine if they comply with quality standards and identifying ways to eliminate causes of unsatisfactory resultsIncludes project (deliverables) and management (cost and schedule performance) resultsAwareness of statistical quality controlPrevention (keep errors out of process) and inspection (keep errors from customers)Attribute sampling (result conforms) and variable samplingSpecial Causes (unusual events) and random causesTolerances (acceptable range) and control limits (result falls within range)Chapter 8 Project Quality ManagementInputs to Quality ControlWork results include process and product resultsQuality Management PlanOperational DefinitionsChecklists

Chapter 8 Project Quality ManagementTools & Techniques for Quality ControlInspection activities such as testing to determine if results comply with requirementsControl Charts plot results over timePareto diagrams frequency of occurrence that identifies type or category of result (80/20 rule) guides corrective actionStatistical sampling select population of interest for inspectionFlowchartingTrend Analysis forecast future outcomes based on historical resultsTechnical performance (# of errors identified; # of errors that remain)Cost and Schedule performance (activities per period with significant variances) Chapter 8 Project Quality ManagementOutputs from Quality ControlQuality ImprovementAcceptance Decisions (accept/reject)Rework action to bring defective item into complianceFrequent cause of project overrunsCompleted checklistsProcess Adjustments immediate corrective/preventive actionsMost likely involves change controlChapter 8 Project Quality ManagementTips from the Review GuidePhilosophy: definition of quality, avoidance of gold plating giving customer extras, prevention over inspectionConformance to requirements, specifications and fitness of useQuality Management processes required to ensure that the project will satisfy the needs for which it was undertakenContinuous Improvement - small improvements to reduce costs and ensure consistency Marginal Analysis optimal quality is reached at the point when revenue from improvement equals the costs to secure itJust in Time - decrease amount of inventory/decrease investmentChapter 8 Project Quality ManagementTips from the Review GuideISO 9000 or 10000 standards to ensure that corporations follow their own quality proceduresTotal Quality Management continuous improvement in business practicesNormal Distribution most common probability used to measure variationsStandard deviation (sigma) measure how far away from the mean (dotted vertical line)3 or 6 sigma represents level of quality +/- 1 sigma equal to 68.26%+/- 2 sigma equal to 95.46%+/- 3 sigma equal to 99.73%+/- 6 sigma equal to 99.99% Chapter 8 Project Quality ManagementTips from the Review GuideResponsibility to quality entire organizationUltimate employeeOverall or Primary Project ManagerDesign and Test Specifications engineerPrevention over inspection quality must be planned in not inspected inChapter 8 Project Quality ManagementTips from the Review GuideCost of conformance vs. non-conformanceQuality Training vs. reworkStudies vs. ScrapSurveys vs. Inventory Costs and warranty costsQuality Planning (Plan) determine what will be quality on project and how quality will be measured done during Planning PhasesIdentifying which standards are relevant to project how to satisfy them Benchmarking look at past projects to determine ideas for improvementCost Benefit Analysis Flowcharts (fishbone)Design of Experiments

Chapter 8 Project Quality ManagementTips from the Review GuideQuality Assurance (Implement) determine if your measurement of quality is appropriate done during Execution phasesProcess of evaluating overall performance on a regular basis Quality Audits structured review of quality activities that identify lessons learned Chapter 8 Project Quality ManagementTips from the Review GuideQuality Control (Check) perform the measurement and compare to the quality plan done during Control phasesProcess of monitoring specific project results to determine if they comply with relevant quality standards and identify ways of eliminating unsatisfactory performancePerformance of the measurement or process, using quality control tools checking work

Chapter 8 Project Quality ManagementTips from the Review GuideQuality Control ToolsPareto Diagrams 80/20 rule the chart presents the information being examined in its order of priority and helps focus attention on the most critical issuesFishbone diagram (Cause and Effect) A creative way to look at the causes or potential causes of a problemHelps stimulate thinking, organizes thoughts and generates discussionCan be used to explore a desired future outcome and the factors to which it relatesChapter 8 Project Quality ManagementTips from the Review GuideQuality Control ToolsChecklists list of items to inspectControl Charts graphic displays of the results over time used to determine if a process is in controlUpper and Lower Control Limits two dashed lines show the acceptable range of a variation range determined by companys quality standard (sigma)Mean line in the middle shows middle of the range of acceptable resultsSpecification Limits 2 solid lines outside the upper and lower control limits represent the customer's expectations/requirements of quality Chapter 8 Project Quality ManagementTips from the Review GuideQuality Control ToolsOut of Control process is out of control when:A data point falls outside of the upper or lower control limitNon-random data points are within the upper control and lower control limitsRule of 7 non-random points outside the mean - process should be investigatedAssignable Cause data point the requires investigation to determine the cause of the variationChapter 8 Project Quality ManagementPMI and DemingCost of conformance 85% of costs of quality are responsibility of ManagementQuality Training ReworkStudies ScrapSurveys Inventory and Warranty costsCrosby absolutes of qualityPerformance standard is zero defects; measurement system is cost of non-conformanceContinuous ImprovementJapanese (Kaizen)Chapter 8 Project Quality ManagementMarginal Analysis optimal quality is reached when incremental revenue from improvement equals incremental cost to secureVariable characteristic to be measuredAttribute measurement (objective or subjective)Increase quality = increased productivity, increased cost effectiveness, decreased cost risk

Chapter 8 Project Quality ManagementReview Guide TipsPrimary responsibility for quality management is the PMResults of increase in qualityIncreased productivityIncreased cost effectivenessDecreased cost riskQuality attributes can be subjective, objective and are specific characteristics for which a project is designed and testedQuality assurance example is team trainingCost of Conformance = team trainingChapter 8 Project Quality ManagementReview Guide TipsMarginal Analysis: optimal quality is reached when incremental revenue from improvement equals the incremental cost to secureStandard Deviation: how far away from meanVariable: characteristic you want to measureAttribute: measurement (subjective or objective)Ultimate Responsibility EmployeeOverall Responsibility PMDesign/Test Specifications - EngineerChapter 8 Project Quality ManagementReview Guide TipsIf quality sample size increases, the quality control band decreasesProduct Cost plus Operations and Maintenance costs increase perceived value when balancedCost of Conformance = trainingCrosby Absolutes of Quality performance of standard is zero defects and the measurement system is the cost of non-conformanceDeming & Japanese are associated with Quality Improvement programsQuality Control performed by operating personnel Chapter 8 Project Quality ManagementReview Guide TipsQuality objectives are approved in conceptual stage by project ownerQA auditing function that provides feedback to team and client about quality of output being producedIf sample size is a constant and acceptance numbers increase, the producers risk decreases and consumer risk increases85% of costs of quality are direct responsibility of management

Chapter 9 Human Resource ManagementProject Human Resource ManagementProcesses required to make the most efficient use of people3 major processes:Organizational PlanningStaff AcquisitionsTeam DevelopmentKeep in mind of transient nature of projectsApply techniques that apply to current project needsEnsure HR compliance with project management activitiesChapter 9 Human Resource ManagementProject Human Resource Management1,9 manager = good relationship with teamProject OrganizationConflict between PM and Functional ManagersDual allegiance of team membersComplex prioritization of resourcesLoss of developed procedures on project dissolutionCompromise = both sides will loseDelegationDefer the decisionInterpreted as passiveEmphasize task vs. personnelCan be frequently used

Chapter 9 Human Resource ManagementProject Human Resource ManagementIf there is a team of experts, PM decisions will promote high satisfactionFunctional/Project Managers likely to exercise:PowerAuthorityInfluenceTraditional organization forms have no single point of contact for client/sponsor

Chapter 9 Human Resource ManagementOrganizational PlanningIdentifying, documenting and assigning project roles, responsibilities, and reporting relationshipsIndividual and group assignmentsInternal and external employeesLinked with communication planningChapter 9 Human Resource ManagementInputs to Organizational PlanningProject Interfaces Organizational interfaces formal and informal reporting relationships among organizational unitsTechnical interfaces - formal and informal reporting relationships among technical disciplinesEngineers, manufacturers, electrical, etc.Interpersonal interfaces formal and informal reporting relationships among individualsStaffing Requirements define skill sets from individual/group in particular time framesChapter 9 Human Resource ManagementInputs to Organizational PlanningConstraints factors that limit project teams optionsOrganizational structure (strong vs. weak matrix)Collective bargaining agreements contractual arrangementsPreferences of project management teamExpected staff assignments Chapter 9 Human Resource ManagementTools & Techniques for Organizational PlanningTemplates reuse a similar projects role and responsibility definitionsHuman Resource Practices corporate policies, guidelines, and practicesOrganizational Theory how organizations are structuredStakeholder Analysis needs of stakeholders are ensured

Chapter 9 Human Resource ManagementOutputs from Organizational PlanningRole and Responsibility Assignments can vary over time, closely linked to scope definition. Utilizes a Responsibility Assignment Matrix (RAM) to define responsibility for each item in the Work Breakdown Structure/task listStaffing Management Plan when and how personnel are included and removed from the project teamResource leveling, reduce transition periods, eliminate dead time between assignments, sensitivity to moraleOrganizational Chart display reporting relationshipsSupporting DetailOrganizational impactJob descriptionsTraining needsChapter 9 Human Resource ManagementStaff AcquisitionEnsure resources are available for project workInputs to Staff AcquisitionStaffing Management PlanStaffing Pool DescriptionPrevious experiencePersonal interestsPersonal characteristicsAvailabilityRecruitment PracticesChapter 9 Human Resource ManagementTools & Techniques for Staff AcquisitionNegotiations with functional managers and other teamsStaff utilization and corporate politicsPre-assignment result of a competitive proposal, or an internal initiativeProcurement outside services are needed (lacking internal skills or availability can not be met)Outputs from Staff AcquisitionProject staff assignedProject Team Directory contact list

Chapter 9 Human Resource ManagementTeam Development enhancing stakeholders to contribute along with maintaining the project teams functionalityPersonal development is the foundationTeam members often balance responsibilities to a functional manager and project managerCritical to success of projectChapter 9 Human Resource ManagementInputs to Team DevelopmentProject StaffProject PlanStaffing Management PlanPerformance ReportsExternal FeedbackPeriodic measurements of performance

Chapter 9 Human Resource ManagementTools & Techniques for Team DevelopmentTeam-building activitiesGeneral Management SkillsReward and recognition systemsPromote desired behaviorMust be achievable; apply to the projectCultural differences recognitionCo-location place members in physical locationTraining enhance skills, knowledge, and capabilities of project teamMust be factored in cost analysis of projectChapter 9 Human Resource ManagementOutputs from Team DevelopmentPerformance ImprovementsIndividual skillsTeam BehaviorIdentify more efficient methods of workInput for performance appraisalsChapter 9 Human Resource ManagementReview Guide TipsRoles and responsibilitiesProject Manger plan, estimate and schedule of projectTeam help prepare the WBS, Network Diagrams, and estimate time for tasks, complete tasksSenior Management approve Overall project plan, budget and schedule and to approve any changes that are made to those figuresThe person experiencing the problem must try to solve it themselves as long as means are in their controlChapter 9 Human Resource ManagementReview Guide TipsPowers:Formal (legitimate)RewardPenalty (coercive)Expert (earned)Referent authority of a higher positionBest are Expert and Reward; Penalty is the worstFormal, Reward and Penalty derived from PMs position within the companyChapter 9 Human Resource ManagementReview Guide TipsConflictInevitable consequence of organizational interactionsCan be beneficialResolved by identifying the causes and problem solving by people that are involved & their immediate managerNature of projectLimited power of the project managerNecessity for obtaining resources from functional managers Chapter 9 Human Resource ManagementReview Guide TipsAvoid conflictInforming the teamClearly assigning tasks without ambiguityChallenging and interesting work assignmentsConflict Sources (in order of frequency)SchedulesProject PrioritiesResourcesTechnical opinionsAdministrative ProceduresCostPersonalityChapter 9 Human Resource ManagementReview Guide TipsMotivational TheoriesMaslows Hierarchy of Needs people work to get a chance to contribute and use their skillsself-actualizationMcGregors Theory of X and YX people need to be watched every minuteY people willing to work without supervisionHerzbergs Theory poor hygiene factors destroy motivation but improving them will not improve motivationMotivating AgentsResponsibilitySelf-actualizationProfessional growthRecognitionChapter 9 Human Resource ManagementReview Guide TipsResponsibility ChartsMatrix cross references team members with tasks (does not show time when job is done)Histogram months vs. number of resourcesGantt Chart shows when staff allocated to tasksLeadership SkillsDirectiveFacilitatingCoaching SupportiveTeam Building SkillsChapter 9 Human Resource ManagementReview Guide TipsProjectized OrganizationConflict between PM and Functional ManagersDual Allegiance of team membersComplex prioritization of resourcesLoss of developed procedures on project dissolutionCompromise both sides will loseDelegationDefer the decisionInterpreted as passiveEmphasize task vs. personnelCan be frequently utilizedChapter 10 Project Communications ManagementProject Communications ManagementProcesses to ensure timely and proper generation, collection, dissemination and disposition of project informationGeneral communications managementCommunications Planning determining informational needs, who needs what and when; 90% of PMs time is spent communicatingInformation Distribution making information availablePerformance Reporting collecting and disseminating project informationAdministrative Closure formalize project/phase completion Chapter 10 Project Communications ManagementCommunications PlanningDetermining information requirements of stakeholdersTightly linked with organizational planningInputs to Communications PlanningCommunication requirements sum of the information requirements of the stakeholdersDefine type and format of information with analysis of value of informationProject organization and stakeholder responsibility relationshipsDisciplines, departments and specialties involved in projectLogistics of number of individuals at locationExternal communication needs (media)Chapter 10 Project Communications ManagementCommunication Technology used to transfer informationImmediacy of need for informationAvailability of technologyExpected project staffing compatible with personnel experienceLength of project will technology change during duration?Constraints factors that limit project teams optionsAssumptionsChapter 10 Project Communications ManagementTools & Techniques for Communication PlanningStakeholder analysis informational needs should be analyzed to develop methodology suited for the project; eliminate unnecessary information or technologiesOutputs from Communications PlanningCommunication Management PlanCollection and filing structure to detail the gathering and storage of information; updating and disseminationDistribution structure who gets info in certain format; compatible with project organization chartDescription of information included format, level of detail, conventionsProduction schedules of each type of communicationMethods for accessing informationMethod for updating and refining communications plan

Chapter 10 Project Communications ManagementInformation Distribution making information available in a timely manner by implementing the communications plan; responding to requests for informationInputs to Information DistributionWork ResultsCommunication Management PlanProject Plan

Chapter 10 Project Communications ManagementTools & Techniques for Information DistributionCommunication Skills used to exchange information. Sender is responsible for clarity; receiver is responsible for receipt and understandingInformation retrieval systems filing systems, softwareInformation distribution systems meetings, correspondence, networked databases, video/audio conferencingOutputs from Information DistributionProject Records maintained in an organized fashionChapter 10 Project Communications ManagementPerformance ReportingCollecting and disseminating performance indicators to provide stakeholders information how resources are achieving project objectivesStatus reportingProgress reportingForecastingProject scope, schedule, cost and quality, risk and procurement Chapter 10 Project Communications ManagementInputs to Performance ReportingProject PlanWork Results deliverables completed, % completed, costs incurredOther Project recordsChapter 10 Project Communications ManagementTools & Techniques for Performance ReportingPerformance reviews meetings to assess statusVariance Analysis comparing actual results to planned or expected results (baseline); cost and schedule most frequentTrend Analysis examining results over time to determine performanceEarned Value Analysis integrates scope, cost and schedule measures calculate 3 keys:Budgeted Cost of Work (BCWS) portion of approved cost estimate planned to be spent on activity during a given periodActual Cost of Work Performed (ACWP) total of direct and indirect cost incurred in accomplishing work on activity in a given periodEarned Value (Budgeted Cost of Work Performed BCWP) percentage of total budget equal to percentage of work actually completedCost Variance (CV) = BCWP ACWPSchedule Variance (SV) = BCWP BCWSCost Performance Index (CPI) = BCWP/ACWPInformation Distribution Tools & Techniques

Chapter 10 Project Communications ManagementOutputs from Performance ReportingPerformance Reports organize and summarize information gathered and present resultsBar charts, Gantt charts, S-curves, etc.Change Requests handled as part of change controlChapter 10 Project Communications ManagementAdministrative ClosureProjects/phases after achieving results or terminated require closureVerifying and documenting project results to formalize acceptanceCollection of project records, analysis of effectiveness, reflect final specifications and archiving of materialChapter 10 Project Communications ManagementInputs to Administrative ClosurePerformance Measurement Documentation includes planning docs; all information that records and analyzes performanceDocumentation of product and projectOther project recordsTools & Techniques of Administrative ClosurePerformance Reporting tools & techniquesOutputs from Administrative ClosureProduct Archives complete index of all records, database updatesFormal Acceptance signoffs from client or sponsorLessons LearnedChapter 10 Project Communications ManagementTips from Review GuideUnderstand all concepts and major pointsMemorize the communications modelUnderstand the inputs/outputs of Administrative ClosureUnderstand how administrative closure differs from contract closeoutContract closeout has product verification and administrative closeout but the contract terms may have special provisions/procedures for closeoutChapter 10 Project Communications ManagementCommunication ModelMessages are encoded by sender and decoded by receiver based on receivers education, experience, language and cultureSender should encode message carefullyNonverbalParalingual (pitch and tone)Active Listening receiver confirms they are listening, confirms agreement and ask for clarificationEffective Listening watching speaker, think before speaking, ask questions, repeating and providing feedback

Chapter 10 Project Communications ManagementCommunication MethodsPick the form of communication that is best for the situationFormal Written complex problems, All Plans, communicating over long distancesFormal Verbal Presentations, speechesInformal Written memos, e-mail, notesInformal Verbal Meetings, conversations

Chapter 10 Project Communications ManagementCommunication BlockersNoise, Distance, Improper en-coding, bad idea, Hostility, Language, CulturePerformance ReportingStatus Reports (where project stands)Progress Reports (what has been accomplished)Trend Report (project results over time)Forecasting Report (projecting future status)Variance Report (actual results vs. planned)Earned ValueCommunication Channels communications grow at a linear rateN (N-1)/2 where N = the number of peopleExample 4 people equals 6 communication channels

Chapter 10 Project Communications ManagementTo determine if someone understands message feedback must be obtainedUnanimous AgreementAll members committedDecisions reached slowlyIntegrity is developedFuture decision making is enhancedClearly defined group goalsMotivate team behaviorCause tension until completedEncourage member identificationComplex messages need oral, written and non verbal methodsThere are 5 directions of communicationFaade when an individual processed needed information but withholds the information

Chapter 10 Project Communications ManagementLeast effective form of communication for complex situations is verbal and formalIf there are a team of experts, PM decisions will likely promote high satisfactionFunctional/Project Mangers likely to exercisePowerAuthorityInfluenceTraditional organization forms have no single point of contact for clients/sponsorsTo determine if someone understands message, must obtain feedbackUnanimous Agreement all members committed, decisions reached slowly, integrity is developed, future decision making is enhancedClearly defined group goals: motivate team behavior, cause tension until completed, encourage member interaction

Chapter 10 Project Communications ManagementComplex messages need oral, written and non verbal methodsLeast effective form of communication for complex issues: verbal and formal

Chapter 11 Project Risk ManagementProject Risk ManagementIncludes identifying, analyzing, and responding to risk areas; maximizing results of positive events and minimizing consequences of adverse eventsRisk Identification which are likely to affect the projectRisk Quantification evaluation of risk to assess the range of possible outcomesSometimes treated as single process; risk analysis/assessmentRisk Response Development defining enhancement steps for opportunities and responseSometimes called response planning/mitigationRisk Response Control responding to changes in risk over course of project May be combined as risk managementChapter 11 Project Risk ManagementRisk IdentificationDetermining which risks are likely to affect the project and documenting themPerformed on a regular basis; address internal and external risksInternal project team has control/influence overExternal beyond project teams controlIdentify cause and effect and effects and causes; what could happen vs. what outcomes should be avoidedChapter 11 Project Risk ManagementInputs to Risk IdentificationProduct Description more risk associated with unproven technologies (innovation/invention). Often described in terms of cost and schedule impactOther Planning Reports WBS (any non-traditional approaches)Cost/Duration Estimates aggressive schedules; limited amount of informationStaffing Plan hard to replace/source skill setsProcurement Management Plan market conditionsHistorical Information previous projectsProject FilesCommercial DatabasesProject Team Knowledge member experiencesChapter 11 Project Risk ManagementTools & Techniques for Risk IdentificationChecklists organized by source of risk, included project context, process outputs, product and technology issues, internal sourcesFlowcharting understand cause and effect relationshipsInterviewing conversations with stakeholders

Chapter 11 Project Risk ManagementOutputs from Risk IdentificationSources of Risk categories of possible risk events, all-inclusiveChanges in requirementsDesign errors, omissions, misunderstandingPoorly defined roles and responsibilitiesInsufficiently skilled staffInclude estimate of probability, range of possible outcomes, expected timing, anticipated frequencyPotential Risk