PMP

Module 1
Project
Is temporary, has a beginning and has an end
Every project creates
A unique product, service or result
Triple Constraint
Scope, schedule, cost
Annex A1 contains
The standard for project management and presents the processes, inputs, and outputs that are considered to be good practice on most projects most of the time
A portfolio refers to
Collection of projects, programs, sub portfolios and operations managed as a group to achieve strategic objectives.
Project management is
The application of knowledge, skills, tools and techniques to project activities to meet the project requirements
The five process groups are
Initiating, planning, executing, monitoring and controlling and closing
Balancing the competing project constraints, which include, but are not limited to:
Scope, quality, schedule, budget, resources and risks
A program is defined as
A group of related projects, sub programs, and programs activities managed in a coordinated way to obtain the benefits not available from managing them individually
A Project Management Office (PMO) is
A management structure that standardizes the project governance processes and facilitates the sharing of resources
Types of PMO’s
Supportive- consultive role to projects by supplying templates. The degree of control is low.

Controlling – provide support and require support through various means. The degree of control is moderate.

Directive – take control of the projects by directly managing the projects. The degree of control is is high.

Operations are ongoing endeavors that produce repetitive outputs, with resources assigned to do basically the same set of tasks according to standards institutionalized in a product life cycle.
Project-based organizations (PBO) refer to
Various organizational forms that create temporary systems for carrying out their work.
Business value is defined as
The entire value of the business; the total sum of all tangible elements.
The project manager is the person assigned by the performing organization to lead the team that is responsible for achieving the project objectives.
In general, the project managers have the responsibility to Satisfy the needs: task needs, team needs, and individual needs.
Effective project management requires that the project manager posses the following competencies:
Knowledge – refers to what the project manager knows about project management

Performance – refers to what the project manager is able to accomplish while applying his or her project management knowledge

Personal – refers to,how the project manager behaves when performing the project or related activity

Operations are ongoing endeavors that produce repetitive outputs, with resources assigned to do basically the same set of tasks according to standards institutionalized in a product life cycle.
Project organizational structures
Functional
– classification structure
– grouped by specialty

Matrixed
– weak
– Balanced
– Strong

Projectized
– opposite end of spectrum from functional
– team members often collated
– PM have great independence, authority
– May be a separate organizational department

Composite
– hybrid
– PM has a lot of control

Organizational Process Assests (OPAs)
Things that the organization owns that are at the deposal of the PM to help manage the project
Of the 47 process groups processes OPAs are input to 38 (80%)
OPAs updates are outputs from 14 (30%)
Enterprise environmental factors (EEF)
Conditions not under the control of the project team
Enterprise environmental factors (EEF) include:
Organizational culture, structure and governance
Geographic distribution of facilities
Government or industry standards
Infrastructure
Human resources
Marketplace conditions
Stakeholder risk tolerance
Political climate
Software is classified as an environmental factor verses OPA
Of the 47 process group processes EEFs are inputs to 27 (57%)
Project success
Project is completed within constraints of
– Quality
– Resources
– Risk
– approved baselines for
– Scope
– Time
– Cost
– Degree of customer satisfaction
Project manager is a team leader regardless of level of authority
Project life cycle characteristics
Start
Organize, prepare
Execute the work
Close project
Processes and procedures
Initiating and planning
Executing, monitoring and controlling
Closing
Corporate knowledge base consist of:
Configuration management knowledge bases
Financial databases
Historical information and lessons learned
Process measurement databases
Project files from previous projects
Project phases
Single phase
Multi-phase sequential
Multi-phase overlapping
Life cycle modes
Predictive
– fully plan driven
Iterative / incremental
– phases intentionally repeat
– as product understanding increases
Adaptive
– agile / change-driven
– rapid, fixed time and schedule iterations
The organizations culture is an enterprise environmental factor
Cultures and styles are learned and shared and may have a strong influence on a projects ability to meet its objectives.
EEF updates are outputs from only 2 (5%)
Software is classified as an environmental factor verses OPA
Stakeholders include all members of the project team as well as all interested entities that are internal or external to,the organization.
The project manager should manage the influences of these various stakeholders in relation to the project requirements to ensure a successful outcome
Stakeholder identification lies a continuous process throughout the entire project lifecycle
Examples of project stakeholders:
Sponsor- person or group who,provides resources and support for the project and is accountable for enabling success
Customers and users – persons or organizations who,will approve and manage the projects product, service or result
Sellers – also called venders, suppliers, or contractors are external companies that enter into a contractual agreement to provide

components or services necessary for the project
Business partners- external organizations stat have a special relationship with the enterprise, sometimes attained thru a certification process
Functional managers – key individuals who play a management role within an administrative or functional area of the business
Other stakeholders-

Project governance is an oversight function that is aligned with the organizations governance model and that encompasses the project life cycle.
Project success
Since projects are temporary in nature, the success of the project should be measured in terms of completing the project within the constraints of scope, time, quality, resources, and risk as approved between the project manager and senior management.
Predictive life cycles
Also known as fully plan driven are ones in which the project scope and the time and cost required to deliver that scope are determined as early in the project life cycle as practically possible
Module 3
Project management is all about application of knowledge, skills, tools, and techniques to,project activities to meet the project requirements
What is a process
A set of interrelated actions and activities performed to create a pre-specified product, service or result
A process is characterized by
By its inputs, the tools and techniques that can be applied, and by the resulting outputs
What should be considered for all processes, even if not explicitly stated
Organizational process assets
Enterprise environmental factors
Successful projects have
Tailored processes
Stakeholder engagement
Meet stakeholder expectations
Balance competing constraints
Project lifecycle phases
Start
Organize/prepare
Carry out the work
Close
Project data
Raw measurements of project work
– % complete
– quality defect measurements
– start/finish dates
– actual costs, durations
Project information
Raw data to meaningful info
– deliverables defect trending
– change request status
– forecastedrestimates
What does a knowledge area represent
A complete set of concepts, terms and activities that make up a professional field, project management field or area of specialization
There are 10 PMBOK knowledge areas
What are the knowledge areas
Project integration management
Project stakeholder management
Project human resource management
Project communications management
Project scope management
Project risk management
Project quality management
Project time management
Project cost management
Project procurement management
Number of activities in each knowledge area
6,6,7,4,3,4,3,6,4,4
Number of a activities in each process group
2,24,8,11,2
The project processes are performed by a he project team with stakeholder interaction and generally fall into one of two major categories
Project management processes
– these processes ensure the effective flow of the project throughout its lifecycle
Product oriented processes
– these processes specify and create the projects product
Good practice means there is general agreement that the application of project management processes has shown to enhance the chances of success over a wide range of products
5 project management process groups
Initiating process group
Planning processes group
Executions process group
Monitoring and controlling process group
Closing process group
The initiating process group consists of those processes performed to define a new project or a new phase of an existing project by obtaining authorization to start the project or phase. The initial scope is defined and initial financial resources are committed.
The planning process group establishes the total scope of the effort, define and refine the objectives and develop the course of action to attain those objectives. The planning process develops the project management plan and the projects documents that will be used to carry out the project.
The executing process group consists of those processes performed to complete the work defined in the PMP to satisfy the project specifications
The monitoring and controlling process group consists of those processes required to,track, review, and orchestrate the progress of performance of the project, identify any areas in which changes to the plan are required and initiate the corresponding changes
The closing process group consists of those processes performed to conclude all activities across all Project management process groups to formally complete mother project
The initiating process group consists of those processes performed to define a new project or a new phase of an existing project by obtaining authorization to start the project or phase
Project governance is an oversight function that is aligned with the organizations governance model and that encompasses the project life cycle.
Module 4
ITTO
Input tools techniques and outputs
The project charter is the first thing you develop to initiate the project
Only one process receives change request and that is 4.5 – perform integrated change control
You validate changes and verify deliverables
Project integration management is all about what
Managing change
Project management integration includes the process and activities to identify, define, combine, unify and coordinate the various processes and project management activities within the project management process groups
Project integration management processes include:
Develop project charter
Develop project management plan
Direct and manage project work
Monitor and control project work
Perform integrated change control
Close project or phase
Projects are initiated by an entity external to the project such as a sponsor, program or project management office (PMO) staff person, or portfolio governing body chairperson or authorized representative
Project charter inputs:
Statements of work
– business need
– product scope definition
– strategic plan
Business case
– describes the necessary information from a business standpoint to determine whether or not the project is worth the require investment
Agreements
– used to define initial intentions for a project
Enterprise environmental factors
Organizational process assets
Expert judgement is often used to assess the inputs used to,develop the project charter
Facilitation techniques also guide the development of the project charter
Brainstorming, conflict resolution, problem solving and meeting management are examples of key techniques used by facilitators
The project charter is the document issued by the project initiator or sponsor that formally authorizes the existence of a project and provides the projects manager with the authority to apply organizational resources to project activities
The project management plan defines how the project is executed, monitored and controlled and closed. It is progressively elaborated by updates and controlled and thru the perform integrated change control (section 4.5) process
Develop project management plan inputs:
Project charter
Outputs from other processes
Enterprise environmental factors
Organizational process assets
Develop project management plan tools and techniques
Expert judgment
Facilitation techniques
The direct and manage project work is the process of leading and performing the work defined in the project management plan and implementing approved changes to achieve project objectives
Corrective action
An intentional active that realigns the performance of the project changes and the implementation of approved changes
Preventive action
An intentional activity that ensures the future performance of the project work is aligned with the project management plan
Defect repair
An intentional activity to modify a nonconforming product or product component
Direct and manage project work meetings tend to be one of three types
Information exchange
Brainstorming, option evaluation or design
Decision making
Work performance data are the raw observations and measurements identified during activities being performed to carry out the project work
A change request is a formal proposal o modify any document, deliverable or baseline.
Change request types include:
Corrective action
Preventive action
Defect repair
Updates
Monitor and control project work is the process of tracking, reviewing and reporting the progress to,meet the performance objectives defined in the project management plan. The key benefit is that it allows stakeholders to understand the current state of the project. The steps taken, and budget, schedule and scope forecast
Work performance reports are the physical or electronic representation of work performance information compiled in project documents, intended to generate decisions, actions or awareness.
The perform integrated change control process is conducted from project inception thru completion and is the ultimate responsibility of the project manger
Some of the configuration management activities included in the perform integrated change control process include:
Configuration identification
Configuration status reporting
Configuration verification and audit
Module 5
Dark arrows represent an output within the same process. A light grey arrow represents output to external process
Charter key benefits:
Formally initiates project
Project manager assignment, if possible
Project manager authority
Costs, milestones
Scope, boundaries
Deliverables
Sponsor endorsement
PMBOK classifies all software as EEFs
There are 9 subsidiary plans
Deliverables
Any unique and verifiable product, result or capability to perform a service that is required to be produced to complete a process, phase or project
The only deliverable is output from 4.3
There is only one place the deliverable is an input to and that is 8.3 (control quality)
Change request
There are three major types
– corrective action (9 citations)
– preventive action (9 citations)
– defect repair (10 citations)
Also
– update (2 citations)
– enhancement requests (1 citation)
There are 9 subsidiary plans
Work performance reports are the physical or electronic representation of work performance information compiled in project documents, intended to generate decisions, actions or awareness.
Monitor and control project work is the process of tracking, reviewing and reporting the progress to,meet the performance objectives defined in the project management plan. The key benefit is that it allows stakeholders to understand the current state of the project. The steps taken, and budget, schedule and scope forecast
The direct and manage project work is the process of leading and performing the work defined in the project management plan and implementing approved changes to achieve project objectives
The project charter is the document issued by the project initiator or sponsor that formally authorizes the existence of a project and provides the projects manager with the authority to apply organizational resources to project activities
Process 4.4 – monitor and control project work is the only process that issues work performance reports
Process 4.5 – perform integrated change control is the only process that outputs a Change log
OPAs are updated 14 times across 10 knowledge areas
EEFs are updated only 2 times, but in only 1 knowledge area
– 9.3 Develop project team
– 9.4 Manage project team
According to PMBOK the schedule baseline is not considered a project document
Approved change requests are the output of process 4.5 – perform integrated change control
Approved change requests are the output of process 4.5 – perform integrated change control
13.1 – Identify Stakeholders has a single output:
Stakeholder register
A stakeholder list is included in the project charter. The stakeholder register builds on this list and is the official project document for stakeholder identification
The stakeholder register is output to 13.2 – plan stakeholder management as well as many external processes
What tools and techniques are used to identify stakeholders
Stakeholder analysis
Expert judgement
Meetings
The engagement level of stakeholders as used in a stakeholder engagement assessment matrix, can be classified as leading, supportive, neutral, resistant and
Unaware
The stakeholder register is output to 13.2 – plan stakeholder management as well as many external processes
Module 6
Process 4.5 – perform integrated change control is the only process that outputs a Change log
Module 7
Project stakeholder management is all about the processes required to
Identify all stakeholder people, groups, organizations, analyze stakeholder expectations, and effectively engage them in project decisions
PMBOK Apdx X3 list interpersonal skills for project managers
The following tools and techniques are used to manage stakeholder engagements
Communication methods
Interpersonal skills
Management skills
information management system (IMS)
Capture, store, distribute information to stakeholders about
– project cost
– schedule progress
– project performance
Work performance information is derived from
Work performance data
As you work to manage and control your stake holder engagements, you include a record of your interactions in pertinent project reports, in certain presentations and in your project lessons learned file. All of these items are considered
Organizational process assets
As you periodically meet with your various project stakeholders, you make updates to your stakeholder register and to the issue log as needed. When you do that, you are updating the
Project documents
Project management stakeholder management includes
13.1 Identify stakeholders
13.2 Plan stakeholder management
13.3 Manage stakeholder engagement
13.4 Control stakeholder engagement
Identify stakeholders inputs:
Project charter
Procurement documents
Enterprise environmental factors
Organizational process assests
Models used for stakeholder analysis
Power/interest grid
Power/influence grid
Influence/impact grid
Salience model
The stakeholder register contains:
Identification information
Assessment information
Stakeholder classification
Plan stakeholder management identifies how the project will affect stakeholders, which then allows the PM to develop various ways to effectively engage stakeholders in the project to manage their expectations and to ultimately achieving the project objectives.
Plan stakeholder management produces which document
Stakeholder management plan
Organizational culture, structure and political climate are important enterprise environmental factors to consider in putting together the stakeholder register
Lessons learned and historical information are important organizational process assets to consider when putting together the stakeholder Register
Engagement levels of stakeholders can be classified as:
Unaware
Resistant
Neutral
Supportive
Leading
Module 8
Project human resource management is all about the processes that
Organize, manage and lead the project team
Project human resource management process:
Plan human resource management
Acquire project team
Develop project team
Manage project team
A project is staffed when:
Appropriate people have been assigned to the team
The project management team is a subset of the project team and is responsible for the project management and leadership activities such as initiating, planning, executing, monitoring, controlling and closing various project phases

This group can also be referred to as the core, executive or leadership team

Plan human resource management is the process of identifying and documenting project roles, responsibilities,required skills, reporting relationships and creating a staffing management plan
The human resource management plan describes how the roles and responsibilities, reporting relationships and staffing management will be addressed and structured within a project
Enterprise environmental factors that influence the plan human resource management process include:
Organizational culture and structure
Existing human resources
Geographical dispersion of team members
Personnel administration policies
Marketplace conditions
Various formats exist to document team members roles and responsibilities. Most of the formats fall into one of three types:
Hierarchical
Matrix
Text-oriented
Regardless of the method used, the objective is to ensure that each work package has an unambiguous owner and that all,team members have a clear understanding of their roles and responsibilities
Hierarchical type charts – the traditional organization chart structure can be used to show positions and relationships I. A graphical, top down format
Work breakdown structures (WBS) designed to show how project deliverables are broken down into work packages provide a way of showing high level areas of responsibility
The organization breakdown structure (OBS) is arranged according to an organizations existing departments, units, or teams with the project activities or work packages listed under each department
The resource breakdown structure (RBS) is a hierarchical list of resources listed by category and resource type that is used to facilitate planning and controlling of project work
Matrix bases charts – a responsibility assignment matrix (RAM) is a grid that shows the project resources assigned to each work package
One example of a RAM is a RACI (responsible, accountable, consult, inform) chart
A RACI chart is a useful tool when the team consists of internal and external resources in order to ensure clear divisions of roles and expectations
Text oriented formats – team member responsibilities that require detailed descriptions can be specified I. Text. Oriented formats
Che human resource management plan. A part of the project management plan, provides guidance on how to project human resources should be defined, staffed, managed and eventually released
The staffing management plan is a component of the human resource management plan that describes when and how project team members will be acquired and how long they will be needed
a resource histogram is used by the project management team as a means of providing a visual representation or resource allocations to all interested parties
The human resource management
Plan includes:
– Roles and responsibilities defining positions, skills, and competencies that the project demands
– project organization charts indicating the number of people needed for the project
– staffing management plan delineating the time periods each project team member will be needed and other information important to engage the project team
The Organizational process assets that influence the acquire project team include:
– organizational standard polices
– processes
– procedures
Acquire project team outputs:
– project staff assignments
– resource calendars
– project management plan updates
Objectives of developing a project team include:
– improving knowledge and skills of team members to increase their ability to complete project deliverables, while lowering cost, reducing schedules and improving quality
– improving feelings of trust and agreement among team members to raise moral, lower conflict and increase teamwork
– creating a dynamic, cohesive and collaborative team culture to improve individual and team productivity, team spirt, cooperation and allow cross training and mentoring between team members to share knowledge and expertise
One of the models to describe team development is the Tuckman model which includes five stages:
– forming
– storming
– norming
– performing
– adjourning
Collocation, also referred to as a right matrix involves placing many or all of the most active team project members in the same physical location to enhance their ability to perform as a team
As a result of managing the project team, change requests are submitted, the human resource management plan is updated. Issues are resolved, input is provided for performance appraisals and lessons learned are added to the organizations database.
The human resource management plan includes:
– roles and responsibilities
– project organization
– staffing management plan
There are five general techniques for resolving conflict:
– withdraw/avoid
– smooth/accomodate
– compromise/reconcile
– force/direct
– collaborate/problem solve
a resource histogram is used by the project management team as a means of providing a visual representation or resource allocations to all interested parties
Module 9
Work performance reports are only output from 4.4 – Monitor and control project work
Change request are only output to 4.5 – Perform integrated change control
There are five general techniques for resolving conflict:
Withdraw/avoid
Smooth/accomodate
Compromise/reconcile
Force/direct
Collaborate/problem solve
As an output of the develop team project team process, information concerning personnel administration, employee training records and skills assessments are all part of:
Enterprise environmental factors
Module 10
Project communications management is all about the processes that are required to ensure timely and appropriate planning, collection, distribution, storage, retrieval, management, control, monitoring and the ultimate disposition of project information
Communication types:
– internal/external
– formal/informal
– vertical/horizontal
– official/unofficial
– written/oral
– verbal (voice inflections)/non-verbal (body language)
Communications management process group processes:
– 10.1 plan communications management
– 10.2 manage communications
– 10.3 control communications
The key input to the plan communication process is:
Stakeholder register
The key output of 10.1 – plan communications management is:
Communications management plan
Efficient communications means providing:
Only the information needed to achieve project objectives
The number of communication Chanel’s between x number of people can be determined using the formula n(n-1)/2
Communication model – basic
– encode
– transmit
– decode
– acknowledge
– feedback/response
What are the three types of meetings:
– information exchange
– brainstorming
– decision-making
Effective communication means that the information is provided in the right format, at the right time, to the right audience and with the right impact
All EEFs described in section 2.1.4 are used as inputs to the plan communications management process
Factors that may affect the choice of communications technology include:
– urgency of the need for information
– availability of technology
– ease of use
– project environment
– sensitivity and confidentially of the information
Medium is the technology medium that includes the mode of communication while noise includes any interference or barriers that might compromise the delivery of the message
Communication methods:
– interactive communications
– push communication
– pull communicationz
Project documents that may be updated include:
– project schedule
– stakeholder register
When performing communications analysis, the foremost consideration is given to:
The value of the information
In the worse case, poor project communication management can lead to:
Complete project failure
What is the key input to the project communications plan?
The stakeholder register
10.2 – Manage Communications:
The key benefit of this process is that it enables an efficient and effective communications flow between project stakeholders
The communications management plan describes how project communications will be planned, structured, monitored and controlled.
Work performance reports are a collection of project performance and status information that may be used to facilitate discussion and to,create communications.
Project documents that may be updated include, but are not limited to:
– issue log
– project schedule
– project funding requirements
10.3 – Control Communications:
The key benefit of this process is that it ensures an optimal information flow among all communications participants, at any moment in time.
The control communications process can trigger an iteration of the plan communications management and/or manage communications process.
Project communications may include:
– deliverables status
– schedule progress
– cost incurred
Project documents may be updated as a result of the control communications process. These updates may include:
– forecast
– performance reports
– issue log
The OPAs that may be updated include:
– report formats
– lessons learned documentation
Performance reporting (baseline verses actual) includes:
– past performance
– project forecast
– current risk & issues (stakeholder)
– for a period:
– work completed
– work to be completed
Project management baseline (PMB)
Project management information system (PMIS):
Used to gather, integrate and disseminate the outputs of project management processes
Information management system (IMS):
Used to collect, store and distribute information between producers and consumers of information. e.g. Stakeholders
The approved plan for,the project work to which the project execution is compared and deviations are measured for management control is the?
Performance measurement baseline
The most common venue to determine the best ways to update and communicate project performance and to respond to requests from stakeholders for information is?
Meetings
Work performance reports are a collection of project performance and status information that may be used to facilitate discussion and to,create communications.
All EEFs described in section 2.1.4 are used as inputs to the plan communications management process
Change request are only output to 4.5 – Perform integrated change control
Module 12
Project scope management is all about ensuring that the project includes all the work required and only the work required, in order to complete the project successfully, with attention to what is NOT included in the project scope
A key PMBOK Concept: a projects success is directly influenced by active stakeholder involvement in the discovery and decomposition of needs into requirements
RTM
Provides:
– Traceabilty
– product requirements from origin to satisfying deliverables
– Links all requirements to
– business needs
– project objectives
– all requirements ( active/cancelled/deferred/added/approved/assigned/completed
WBS
– a structured vision of the devliverables
– scope baseline as basis for all project control
– integral part of PM plan
The scope baseline consist of?
– approved project scope statement
– work breakdown structure (WBS)
– WBS dictionary
The Work breakdown structure (WBS) consist of?
– control account
– planning package
– work package
What is known WBS that includes known work without detailed schedule activities?
Planning package
The WBS, the WBS dictionary and the approved project scope statement are all specific components of the?
Scope baseline
Project scope management processes include:
– plan scope management
– collect requirements
– define scope
– create WBS
– validate scope
– control scope
In the project context, the term scope is
– product scope
– project scope
The scope baseline for the project is the approved version of the project scope statement, WBS and its associated WBS dictionary and can only be changed thru formal change control procedures and is used for a basis of comparison.
Completion of the project scope is measured against the project management plan
Plan scope management inputs include:
– project management plan
– project charter
– EEFs
– OPAs
The scope management plan is a component of the project or program management plan that describes how the scope will be defined, developed, monitored, controlled and verified.
The requirements management plan is a component of the project management plan that describes how requirements will be analyzed, documented and managed.
The key benefit of the collect requirements process is that it provides the basis for defining and managing the project scope including product scope.
The development of requirements begins with an analysis of the information contained in the project charter, the stakeholder register and the stakeholder management plan
Collect requirements inputs:
– scope management plan
– requirements management plan
– stakeholder management plan
– project charter
– stakeholder register
Several group activities can be organized to identify project and product requirements:
– brainstorming
– nominal group technique
– idea mind mapping
– affinity diagram
– multi criteria decision analysis
There are various methods of reaching a group decision:
– unanimity
– majority
– plurality
– dictatorship
Before being baselines, requirements need to be unambiguous (measurable and testable), traceable, complete, consistent and acceptable to key stakeholders
Components of requirements documentation can include:
– business requirements
– stakeholder requirements
– solution requirements
– project requirements
– transition requirements
– requirements assumptions, dependencies and constraints
The requirements traceability matrix is a grid that links product requirements from their origin to the deliverables that satisfy them
The key benefit of the define scope process is that it describes the product, service, or result boundaries by defining which of the requirements collected will be included in and excluded from project scope
The project scope statement documents the entire scope including project and product scope. It describes,min detail, the projects deliverables and the work required to create those deliverables
The detailed project scope statement, either directly, or by reference to other documents includes:
– product scope description
– acceptance criteria
– deliverable
– project exclusion
– constraints
– assumptions
WBS
– a structured vision of the devliverables
– scope baseline as basis for all project control
– integral part of PM plan
Create WBS is the process of subdividing project deliverables and project work into smaller, more manageable components. The key benefit of this process is that it provides a structured vision of what has to be delivered.
Create WBS inputs:
– scope management plan
– project scope statement
– requirements documentation
– EEFs
– OPAs
The work package is the work defined at the lowest level of the WBS for which cost and duration can be estimated and managed
A WBS structure may be created through various approaches. Some of the popular methods include:
– top-down approach
– use of organization specific guidelines
– use of WBS templates
The total of the work at the lowest levels should roll up to the higher levels so that nothing is left out and no extra work is performed. This is sometimes referred to as the:
100% rule
A control account is a management control point where scope, budget, actual cost and schedule are integrated and compared to the earned value for performance measurement.
A planning package is a WBS component below the control account with known work content but without detailed schedules activities
The key benefit of the validate scope process is that it brings objectivity to the acceptance process and increases the chance of final product, service or result acceptance by validating each deliverable
Validate scope outputs:
– accepted deliverables
– change requests
– work performance information
– project documents updates
The key benefit of the control scope process is that it allows the scope baseline to be maintained throughout the project.
The uncontrolled expansion to product or project scope without adjustments to time, cost and resources is referred to as:
Scope creep
Variance analysis is a technique for determining the cause and degree of difference between the baseline and actual performance
Module 13
The key benefit of the validate scope process is that it brings objectivity to the acceptance process and increases the chance of final product, service or result acceptance by validating each deliverable
A planning package is a WBS component below the control account with known work content but without detailed schedules activities
Create WBS is the process of subdividing project deliverables and project work into smaller, more manageable components. The key benefit of this process is that it provides a structured vision of what has to be delivered.
The key benefit of bringing objectivity to the acceptance process and increasing the likelihood of final product acceptance relates to which of the following scope management processes:
Validate scope
The act of of measuring, examine and validating to determine whether the work and deliverables meet requirements and product acceptance criteria is called:
Inspection
The ______________is used to compare against actual project results in order to,determine if a change, corrective action, or preventive action is necessary:
Scope baseline
Module 14
Project risk is all about maximizing the likelihood and impact of positive events (opportunities) and minimizing the likelihood and impact of negative events (threats)
You use contingency reserve for known risk (known-unknowns) and management reserve for unknown risk (unknown-unknowns)
What are three types of project. Attitudes
Risk appetite (degree of uncertainty you are willing to take)
Risk tolerance (degree of risk an entity can withstand)
Risk threshold (point where an entity will either accept or no longer tolerate the risk)
Risks info gathering techniques:
Brainstorming
Delphi technique
Interviewing
Root cause analysis
The Delphi technique is a way to,reach consensus of experts. Project risk experts participate in this technique anonymously.
Cause and effect diagrams (also known as Ishikaw or fish bone diagrams) are useful for identifying causes of risk
Influence diagrams are graphical representations of situations showing causal influences, time ordering of events, and other relationships among variables and outcomes
SWOT Analysis examines the project from each of the strengths, weaknesses, opportunities and threats (SWOT) perspectives to increase the breath of identified risks by including internally generated risks.
The primary output from identify risks is the initial entry into the risk register. The risk register is a document in which the results of risk analysis and risk response planning ate recorded.
Perform qualitative risk analysis is the process of prioritizing risks for further analysis or action by assessing and combining their probability of occurrence and impact.
The perform qualitative risk analysis process is performed regularly throughout the project life cycle as defined in the project’s risk management plan. The process can lead into perform quantitative risk analysis (section 11.4) or directly into plan risk responses (section 11.5).
Perform qualitative risk analysis inputs include:
– risk management baseline
– scope baseline
– risk register
– EEFs
– OPAs
Risk data quality assessment is a technique to evaluate the degree to which the data about risk is useful for risk management.
Perform qualitative risk a analysis outputs include:
– Risk register updates
– assumptions log updates
Perform quantitative risk analysis is the process of numerically analyzing the effect of identified risks on overall project objectives
Perform quantitative risk analysis generally follows the perform qualitative risk analysis process.
Perform quantitative risk analysis is performed on risk that have been prioritized by the qualitative risk analysis as potentially and substantially impacting the projects competing demands.
Continuous probability distributions which are used extensively in modeling and simulation, represent the uncertainty in values such as durations of schedule activities and cost of project components.
Sensitivity analysis helps to determine which risks have the most potential impact on the project. It helps to understand how the variations in projects objectives correlate with variations in different uncertainties.
Expected monetary value (EMV) analysis is a statistical concept that calculates the average outcome when the future includes scenarios that may or may not happen. A common use of this type of analysis is a decision tree analysis
A project simulation uses a model that translates the specified detailed uncertainties of the project into their potential impact on project objectives. Often use Monte Carlo technique.
Quantitative risk analysis outputs:
– probabilistic analysis of the project
– probability of achieving cost and time objectives
– prioritized list of quantified risks
– trends in quantitative risk analysis results
The plan risk responses is the process of developing options and actions to enhance opportunities to reduce threats to project objectives.
The plan risk response process follows the perform quantitative analysis process (if used)
Plan risk responses input:
– risk management plan
– risk register
Strategies for negative risks or threats
– avoid
– transfer
– mitigate
– accept
Strategies for positive risks or opportunities-
– exploit
– enhance
– share
– accept
Control risks is the process of implementing risk plans, tracking identified risks, monitoring residual risks, and evaluating risk process effectiveness throughout the project.
The key benefit of this process is that it improves efficiency of the risk approach throughout the project lifecycle to continuously optimize risk responses.
Control risks inputs:
– project management plan
– risk register
– work performance data
– work performance reports
Control risks outputs:
– work performance information
– change requests
– recommended corrective actions
– recommended preventive action
– project management plan updates
– project documents updates
– organizational process assets updates
The key benefit of this process is that it improves efficiency of the risk approach throughout the project lifecycle to continuously optimize risk responses.
The plan risk response process follows the perform quantitative analysis process (if used)
Perform qualitative risk analysis is the process of prioritizing risks for further analysis or action by assessing and combining their probability of occurrence and impact.
Beta and triangular distributions are frequently used in quantitative risk analysis. The horizontal (x) axes represent possible values of time or cost and the vertical (y) axes represent relative likelihood.
Quantitative risk analysis & modeling techniques include:
– Sensitivity analysis/ Tornado diagrams
– Expected monetary value analysis (EVM)
Quality and the triple constraint of scope, time, costs, amongst others are referred to as:
Project objectives
Contingent response strategies:
– pre-specified conditions to activate
– triggers activate planned response
– contingency, fallback plans
– workarounds
Residual Risks:
Risks that are expected to remain after planned responses have been taken, as well as those that have been deliberately accepted
Secondary risk:
A direct outcome of implementing a risk response
Plan Risk Management – the process of defining how to conduct risk management activities for a project.
Module 17 – Project Quality Management
Project quality management is all about the processes and activities of the performing organization that determine:
– quality policies
– quality objectives
– quality responsibilities

So the project will satisfy the needs for which it was undertaken

Quality management process group processes include:
– plan quality management
– perform quality assurance
– control quality
Cost of quality consists of two components:
– cost of conformance (money spent during the project to avoid failures)
– preventive costs
– appraisal costs
– cost of nonconformance (money spent during and after the project because of failures)
– internal failure costs
– external failure costs
Cost benefit analysis:
Cost of quality verses expected benefit
SIPOC Model:
Suppliers, inputs, processes, outputs, customers – a form of flow charting
Seven basic quality tools:
– cause and effect diagram
– flowchart
– check sheets
– Pareto diagrams
– histograms
– control charts
– scatter diagrams
Quality measures and techniques are specific to the type of deliverables being produced by the project
Module 18 – Quality Assurance and Project Quality Control
Grade relates to deliverables which differ technically but have similar fucntion
While a quality level that fails to meet quality requirements is always a problem , a low grade of quality may not be a problem
Precision is a measure of exactness whereas Accuracy is a measure of correctness
Quality Assurance is:
The process of auditing the quality requirements and the result of quality control measurements in order to facilitate improvements to quality processes
Control Quality is the process of monitoring and recording results of executing the quality activities to assess performance and recommend necessary changes.
Statistical control process terms
Prevention
– keeping errors out of the process
Inspection
– keeping errors out of the customers hands
Attribute sampling:
The results either conform or not
Variables sampling
Measures degree of non- conformity
Tolerances:
Specific range of acceptable results
The fundamental intent of continuous process improvement is to enhance process efficiency and effectiveness by:
Reducing waste and eliminating activities that do not add value
Regarding the quality control process, which of the following is the only correct input/output pairing:
Deliverables/verified deliverables
The primary goal of the quality control process is to:
Determine the correctness of deliverables
Plan quality management:
The process of identifying quality requirements and/or standards for the project and its deliverables and documenting how the project will demonstrate compliance and quality requirements
Perform quality assurance:
The process of auditing the quality requirements and the results from quality control measurements to ensure that appropriate quality standards and operational definitions are used
Quality control:
The process of monitoring and recording results of executing the quality activities to assess performance and recommend necessary changes
Conformance to requirements:
Ensure the project produces what it was created to produce
Fitness for use:
The product or service needs to satisfy the real needs
The PDCA (plan-do-check-act) cycle is the basis for quality improvement as defined by Shewhart and modified by Deming.
IPECC:
Initiating, planning, executing, controlling and closing
Project quality management addresses the management of the project and the deliverables of the project.
Quality and grade are not the same concepts:
Quality as a delivered performance or result is the degree to which a set of inherent characteristics fulfill requirements (ISO 9000)
Grade as a design intent is category assigned to deliverables having the same functional use but different technical characteristics
Continuous improvement:
The PDCA (plan-do-check-act) cycle is the basis for quality improvement as defined by Shewhart and modified by Deming.
Perform quality assurance is an execution process ghat uses data created during plan quality management (section 8.1) and control quality (section 8.3) processes
Quality assurance work will fall under the conformance work category in the cost of quality framework.
Affinity diagrams:
Similar to mind mapping techniques in that they can be linked to form organized patterns of thought about a problem
Process decision program charts (PDPC):
Used to understand a goal in relation to the steps for getting to the goal
Interrelationship digraphs:
Provide a process for creative problem solving in moderately complex scenarios that possess intertwined logical relationships for up to 50 relevant items.
Tree diagrams:
Used to represent decomposition hierarchies such as the WBS, RBS and OBS
Prioritization matrices:
Identify key issues and the suitable alternatives to be prioritized as a set of decisions for implementation
Module 19: Planning, defining and sequencing project activities
Quality assurance work will fall under the conformance work category in the cost of quality framework.
Sequencing is the relationship between activities arranged into a logical ordering of work to gain greatest efficiency within project constraints resulting in the project network schedule diagram.
finish-to-start (FS) – most common scheduling sequence
Activity-on-node (AON)
Uses boxes to denote schedule activities
Boxes or nodes are connected from beginning to end with arrows to depict a logical relationship of the dependencies between the schedule activities
Activity-on-arrow (AOA)
Circles denote completed milestones
Arrows denote tasks
Dotted arrows are dummy tasks
No durations, only work flow logic
Leads and lags
Lead – successor advanced earlier than predecessor
Lag – successor delayed later than predecessor
For which of the following might a project milestone schedule model view be most appropriate:
Management reports
The schedule baseline is:
An approved version of the project schedule model at some point in time
When estimating activity resources, the best use of the risk register would be to help identify how logged risk events might impact:
Resource selection and availability
Module 21 – Develop and control,of the project schedule
The critical path is the longest duration path thru the schedule network diagram, which determines the shortest time to complete all the work (the activities)
Total float:
Free float:
Critical chain method – CCM:
Compensate for uncertainties
End point project buffer
Non-critical chain feeding buffers
Best when limited resources
Resource leveling:
Start/finish dates adjusted to balance demand with supply
Module 21 – Develop and control,of the project schedule
Automated schedule model generation:
Resource smoothing:
Adjusting resources for activities not on the critical path
Schedule performance index (SPI)
1.0 means you are on schedule. Anything above 1.0 means you are taking longer than forecasted. Anything below 1.0 means you are taking less time than forecasted.
During the control schedule process, determine whether corrective action may be required by analyzing the status of free and project buffers is a technique of:
Critical chain analysis
Automated project schedule presentation:
Lead:
Advance successor relative to predeccessor
Lag:
Time elapsed between successor, predecessor
6.1 Plan Schedule Management:
The process of establishing the policies, procedures and documentation for planning, developing, managing, executing, and controlling the project schedule
6.2 Define Activities:
The process of identifying and documenting the specific actions to be performed to produce the project deliverables
6.3 Sequence Activities:
The process of identifying and documenting relationships among the project activities
6.4 Estimate Activity Resources:
The process of estimating the type and quantities of material, human resources, equipment, or supplies required to perform each activity
6.5 Estimate Activity Durations:
The process of estimating the number of work periods needed to complete individual activities with estimated resources
6.6 Develop Schedule:
The process of analyzing activity sequences, durations, resource requirements, and schedule constraints to create the project schedule model
6.7 Control Schedule:
The process of monitoring the status of project activities to update project progress and manage changes to the schedule baseline to achieve the plan
A schedule model is a representation of the plan for executing the projects activities including durations, dependencies, and other planning information, used to produce project schedules along with other scheduling artifacts.
The Project Time Management processes and their associated tools and techniques are documented in the schedule management plan.
The schedule management plan identifies a scheduling method and scheduling tool and sets the format and establishes criteria for developing and controlling the project schedule.
The finalized and approved is the baseline that will be used in the control schedule process (Section 6.7)
Plan schedule management inputs:
Project management plan
Project charter
EEFs
OPAs
Plan schedule management tools and techniques:
Expert judgment
Analytical techniques
Meetings
Plan schedule management outputs:
Schedule management plan
Schedule management plan:
A component of the project management plan that establishes the criteria and the activities for developing, monitoring, and controlling the schedule.
The schedule management plan may consist of:
Project schedule model development
Level of accuracy
Units of measure
Organizational procedure links
Project schedule model maintenance
Control thresholds
Rules of performance measurement
Reporting formats
Process descriptions
6.2 Define activities is the process of identifying and documenting the specific actions to be performed to produce the project deliverables:
The key benefit of this process is to break down work packages into activities that provide a basis for estimating, scheduling, executing, monitoring and controlling the project work.
The create WBS process identifies the deliverables at the lowest level in the WBS – the work package:
Work packages are typically decomposed into smaller components called activities
Rolling Wave Planning:
An interactive planning technique in which the work to be accomplished in the near term is planned in detail, while the work in the future is planned at a higher level.
Sequence activities is the process of identifying and documenting relationships among project activities:8
The key benefit of this process is that it defines the logical sequence of work to obtain the greatest efficiency given all project constraints.
Each activity and milestone except the first and last should be connected to at least one predecessor with a finish-to-start or start-to-start logical relationship and at least one successor with a finish-to-start of finish-to-finish logical relationship.
The scheduling management plan identifies the scheduling method and tool to be used on the project.
The Precedence Diagramming Method (PDM) is a technique used for constructing a schedule model in which activities are represented by nodes and are graphically linked by one or more logical relationships to show the sequence in which the activities are to be performed.
Activity- on-Node (AON) is one method of representing a precedence diagram. This is the method used by most project management software packages.
Finish-to-Start (FS):
A logical relationship in which a successor activity cannot start until a predecessor activity has finished.
Finish-to-Finish (FF):
A logical relationship in which a successor activity cannot finish until a predecessor activity has finished.
Start-to-Start (SS):
A logical relationship in which a successor activity cannot start until a predecessor activity has started.
Start-to-finish (SF):
A logical relationship in which a successor activity cannot finish until a predecessor activity has started.
The scheduling management plan identifies the scheduling method and tool to be used on the project.
In PDM, finish- to-start is the most commonly used type of precedence relationship
Types of dependencies:
Mandatory
Discretionary
External
Internal
Discretionary dependencies re sometimes referred to as preferred logic, preferential logic or soft logic
A lead is the amount of time whereby a successor activity can be advanced with respect to a predecessor activity
A Lag is the amount of time whereby a successor activity will be delayed with respect to a predecessor activity
Estimate activity resource is the process of estimating the type and quantities of material, human resources, equipment, or supplies required to,perform each activity:
The key benefit of this process is that it identifies the type, quanity, and characteristics of resources required to complete each activity which allows for more accurate cost and duration estimates.
The activity attributes provide the primary data input for use in estimating those resources required for each activity in the activity list.
Bottom-up Estimating is a method of estimating project duration or cost by aggregating the estimates of the lower level components of the WBS.
The Resource Breakdown Structure (RBS) is a hierarchical representation of resources by category and type.
6.5 Estimate activity durations is the process of estimating the number of work periods needed to complete individual activities with estimated resources.
Analogous estimating is a technique for estimating the duration or cost of an activity or a project using historical data from a similar activity or project.
Parametric estimating is an estimating technique in which an algorithm is used to calculate cost or duration based on historical data and project parameters.
Three point estimating uses three estimates to define an approximate range for an activities duration to include:
Most likely (tM)
Optimistic (tO)
Pessimistic (tP)
Two commonly used formulas for three point estimating include:
Triangular Distribution tE = (tO + tM +tP) / 3
Beta Distribution tE = (tO + 4tM + tP) / 6
Contingency reserves are the estimated duration within the schedule baseline, which is allocated for identified risks that are accepted and for which a contingent or mitigation responses are developed.
Contingency reserves are associated with the known-unknowns
Management reserve are a specified amount of the project duration withheld for management control purposes and are reserved for unforeseen work that is within the scope of the project.
Management reserves are intended to address the unknown-unknowns.
6.6 Develop schedule is the process of analyzing activity sequences, durations, resource requirements, and schedule constraints to create the project schedule model.
The critical path method, which is a method used to estimate the minimum project duration and determine the amount of flexibility on the logical network paths within the schedule model.
Schedule network analysis is a technique that generates the project schedule model.
The critical path is the sequence of activities that represents the longest path thru the project, which determines the shortest possible project duration.
The critical chain method (CCM) is a schedule method that allows the project team to place buffers on any project schedule path to account for limited resources and project uncertainties.
The CCM method adds duration buffers that are non-work schedule activities to manage uncertainty.
Resources leveling is a technique in which start and finish dates are adjusted based on resource constraints with the goal of balancing demand for resources with the available supply.
Resource smoothing, as opposed to, resource leveling, the projects critical path is not changed and the completion date may not be delayed.
Schedule compression techniques:
Crashing – a technique used to shorten the schedule duration for the least incremental cost by adding resources

Fast tracking – compression technique in which in which activities or phases normally done in sequence are performed in parallel for at least a portion of their duration.

A schedule baseline is the approved version of a schedule model that can be changed only through formal change control procedures and is used as a basis for comparisons to actual results.
The outputs from a schedule model are schedule presentations.
Control schedule is the process of monitoring the status of project activities to update project progress and manage changes to the schedule baseline to achieve the plan.
Module 22 – Planning and Estimation of Project Cost
Project cots management management includes the processes involved in:
Planning
Estimating
Budgeting
Financing
Funding
Managing
Controlling costs
Project cost management includes the following processes:
7.1 Plan cost management
7.2 Estimate costs
7.3 Determine budget
7.4 Control costs
Control thresholds:
Variance thresholds for monitoring cost performance indicate variation from the baseline plan allowed before some action needs to be taken.
In addition to expert judgement and project team meetings, which other tool and technique is used to develop the cost management plan:
Analytical
When predicting total project costs, the use of historical relationships can best result in:
Parametric and/or analogous cost estimates
The cost baseline is an output from which cost management process:
Determine budget
Module 24 – Controlling Project Costs
Earned Value Management monitors three key components:
Planned value (PV)
Earned value (EV)
Actual cost (AC)
EVM integrates:
Scope baseline
Cost baseline
Schedule baseline

To create a Performance Measurement Baseline (PMB)

Schedule variance formula:
SV = EV – PV
Cost variance formula:
CV = EV – AC
Schedule performance index (SPI) formula:
SPI = EV / PV
Cost performance index (CPI) formula:
CPI = EV / AC
CPI is considered the most critical EVM metric
To-complete performance index (TCPI):
A measure of the cost performance efficiency that is required to be achieved w it’s the remaining resources in order to achieve the final project cost.
TCPI = (BAC – EV / BAC – AC):
Work remaining / funds remaining = work to be completed for every dollar spent
CPI is considered the most critical EVM metric
A TCPI over 1.1 is not good
Variance analysis:
VAC = BAC – EAC
Project funding requirements include:
The cost baseline plus management reserve
A TCPI over 1.1 is not good
Control schedule is the process of monitoring the status of project activities to update project progress and manage changes to the schedule baseline to achieve the plan.
The critical path is the sequence of activities that represents the longest path thru the project, which determines the shortest possible project duration.
In PDM, finish- to-start is the most commonly used type of precedence relationship
Project cost management is primarily concerned with the cost of resources needed to complete project activities.
7.1 Plan Cost Management:
Process that establishes the policies, procedures, and documentation for planning, managing, expending and controlling project costs.
The project charter provides the summary budget from which the detailed project cost are developed.
The WBS (section 5.4) provides the framework for the cost management plan. The WBS component used for the project cost accounting is called the control account.
7.2 Estimate Costs:
Process of developing an approximation of the monetary resources needed to complete project activities
One basic assumption that needs to be made when estimating project costs is whether the estimates will be limited to direct project costs only or whether the estimates will also include indirect costs.
Analogous Estimating:
Cost estimating technique that uses values such as scope, cost p, budget and duration or measures of scale such as size, weight and complexity from a previous or similar project as the basis of measurement for the current project.
Analogous estimating is generally less costly and less time consuming than other techniques, but it is also less accurate.
Parametric Estimating:
Uses a statistical relationship between relevant historical data and other variables to calculate a cost estimate for project work.
Bottom-up Estimating:
Is a method of estimating a component of work. The cost of individual work packages or activities is estimated to the greatest level of detail. The detailed cost is then summarized or “rolled up” to higher levels for subsequent reporting and tracking purposes.
Three-point estimating:
Most likely (cM) – the cost of the activity, based on realistic effort assessment for the required work and any predicted expenses

Optimistic (cO) – the activity cost based on analysis of the best case scenario for the activity

Pessimistic (cP) – the activity cost based on analysis of the worse case scenario for the activity

Triangular Distribution:
cE = (cO + cM + cP) / 3
Reserve Analysis:
Contingency reserves are the budget within the cost baseline that is allocated for identified risks. The are intended to address the “known-unknowns” that can affect a project.

Management reserves are an amount of the project budget withheld for management control purposes and are reserved for unforeseen work that is within the scope of the project. They address the “unknown unkowns” that can affect a project, the management reserve is not included in the cost baseline. If it is used, it requires an approved change to the cost baseline.

7.3 – Determine Budget:
Process of aggregating the estimated costs of individual activities or work packages to establish an authorized cost baseline.
Budget reserve analysis can establish both the contingency reserves and the management reserves for the project.
7.4 – Control Costs:
Process of monitoring the status of the project costs and managing changes to the cost baseline.
Earned Value Management (EVM):
Methodology that combines scope. Schedule and resource measurements to assess project performance and progress.
EVM develops and monitors three key dimensions for each work package and control account:
Planned value (PV) is the authorized budget to,scheduled work. It is the authorized budget planned for the work to be accomplished for an activity or work breakdown structure component, not including management reserve.

Earned Value (EV) is a measure of worked performed expressed in terms of the budget authorized for that work. It is the budget associated with the authorized work that has been completed.

Actual cost (AC) is the realized cost incurred for the work performed on an activity during a specific time period. It is the total cost incurred in accomplishing the work that the EV measured.

Schedule Variance (SV):
Is a measure of schedule performance expressed between the earned value and the planned value. It is the amount by which the project is ahead or behind the planned delivery date.

Equation: SV = EV – PV

Cost Variance (CV):
Is the amount of budget deficit or surplus at a given point in time, expressed as the difference between earned value and the actual cost. It is a measure of cost performance on a project.

Equation: CV = EV – AC

Schedule Performance Index (SPI):
Is a measure of schedule efficiency expressed as the ratio of earned value to planned value. An SPI of less than 1.0 indicates less work was completed than planned. An SPI greater than 1.0 indicates more work was completed than planned.

Equation: SPI = EV/PV

Cost Performance Index (CPI):
Is a measure of cost efficiency of budgeted resources, expressed as a ratio of earned value to a causal cost. It is the most critical EVM metric and measures the cost efficiency for the work completed. A CPI of less than 1.0 indicates cost over run. A CPI of greater than 1.0 indicates. Cost under run.

Equation: CPI = EV/AC

EAC:
Estimate of completion
EACs are typically based on the actual costs incurred for work completed, plus an estimate to complete (ETC) the remaining work
The most common EAC forecasting approach is a manual, bottom up summation by the project manager and project team.
The to-complete performance index (TCPI) is a measure of the cost performance that is required to be achieved with the remaining resources in order to meet a specified management goal, such as the BAC or the EAC.

Equation: BAC: (BAC – EV) / (BAC – AC)

Module 25: Planning and Conducting Project Procurements
Beta Distribution (from a traditional PERT analysis):
cE = (cO + 4cM + cP) / 6
Project management plan contains:
Project scope statement
WBS
WBS dictionary
Contract types:
The project manager can act as a negotiator for procurements.
Project cost management is primarily concerned with the cost of resources needed to complete project activities.
7.1 Plan Cost Management:
Process that establishes the policies, procedures, and documentation for planning, managing, expending and controlling project costs.
The project charter provides the summary budget from which the detailed project cost are developed.
The WBS (section 5.4) provides the framework for the cost management plan. The WBS component used for the project cost accounting is called the control account.
7.2 Estimate Costs:
Process of developing an approximation of the monetary resources needed to complete project activities
One basic assumption that needs to be made when estimating project costs is whether the estimates will be limited to direct project costs only or whether the estimates will also include indirect costs.
Analogous Estimating:
Cost estimating technique that uses values such as scope, cost p, budget and duration or measures of scale such as size, weight and complexity from a previous or similar project as the basis of measurement for the current project.
Analogous estimating is generally less costly and less time consuming than other techniques, but it is also less accurate.
Parametric Estimating:
Uses a statistical relationship between relevant historical data and other variables to calculate a cost estimate for project work.
Bottom-up Estimating:
Is a method of estimating a component of work. The cost of individual work packages or activities is estimated to the greatest level of detail. The detailed cost is then summarized or “rolled up” to higher levels for subsequent reporting and tracking purposes.
Three-point estimating:
Most likely (cM) – the cost of the activity, based on realistic effort assessment for the required work and any predicted expenses

Optimistic (cO) – the activity cost based on analysis of the best case scenario for the activity

Pessimistic (cP) – the activity cost based on analysis of the worse case scenario for the activity

Triangular Distribution:
cE = (cO + cM + cP) / 3
Reserve Analysis:
Contingency reserves are the budget within the cost baseline that is allocated for identified risks. The are intended to address the “known-unknowns” that can affect a project.

Management reserves are an amount of the project budget withheld for management control purposes and are reserved for unforeseen work that is within the scope of the project. They address the “unknown unkowns” that can affect a project, the management reserve is not included in the cost baseline. If it is used, it requires an approved change to the cost baseline.

7.3 – Determine Budget:
Process of aggregating the estimated costs of individual activities or work packages to establish an authorized cost baseline.
Budget reserve analysis can establish both the contingency reserves and the management reserves for the project.
7.4 – Control Costs:
Process of monitoring the status of the project costs and managing changes to the cost baseline.
Earned Value Management (EVM):
Methodology that combines scope. Schedule and resource measurements to assess project performance and progress.
EVM develops and monitors three key dimensions for each work package and control account:
Planned value (PV) is the authorized budget to,scheduled work. It is the authorized budget planned for the work to be accomplished for an activity or work breakdown structure component, not including management reserve.

Earned Value (EV) is a measure of worked performed expressed in terms of the budget authorized for that work. It is the budget associated with the authorized work that has been completed.

Actual cost (AC) is the realized cost incurred for the work performed on an activity during a specific time period. It is the total cost incurred in accomplishing the work that the EV measured.

Schedule Variance (SV):
Is a measure of schedule performance expressed between the earned value and the planned value. It is the amount by which the project is ahead or behind the planned delivery date.

Equation: SV = EV – PV

Cost Variance (CV):
Is the amount of budget deficit or surplus at a given point in time, expressed as the difference between earned value and the actual cost. It is a measure of cost performance on a project.

Equation: CV = EV – AC

Schedule Performance Index (SPI):
Is a measure of schedule efficiency expressed as the ratio of earned value to planned value. An SPI of less than 1.0 indicates less work was completed than planned. An SPI greater than 1.0 indicates more work was completed than planned.

Equation: SPI = EV/PV

Cost Performance Index (CPI):
Is a measure of cost efficiency of budgeted resources, expressed as a ratio of earned value to a causal cost. It is the most critical EVM metric and measures the cost efficiency for the work completed. A CPI of less than 1.0 indicates cost over run. A CPI of greater than 1.0 indicates. Cost under run.

Equation: CPI = EV/AC

EAC:
Estimate of completion
EACs are typically based on the actual costs incurred for work completed, plus an estimate to complete (ETC) the remaining work
The most common EAC forecasting approach is a manual, bottom up summation by the project manager and project team.
The to-complete performance index (TCPI) is a measure of the cost performance that is required to be achieved with the remaining resources in order to meet a specified management goal, such as the BAC or the EAC.

Equation: BAC: (BAC – EV) / (BAC – AC)

Module 25: Planning and Conducting Project Procurements
Beta Distribution (from a traditional PERT analysis):
cE = (cO + 4cM + cP) / 6
When a project contains products or services from outside of their performing organization, the four procurement management processes are BEST described as being:
Performed foe each item as required
Each individual procurement requires a SOW that describes which part of the project scope is to be included in that procurement and the blank is the best document to use to develop that SOW:
Procurement SOW
Chapter 12 – Project Procurement Management
The close procurements process also involves administrative activities such as finalizing open claims, updating records to reflect final results and archiving such information for future use.
The close procurements process supports the close project or phase (section 4.6) by ensuring contractual agreements are completed of terminated.
The project management plan contains the procurement management plan which provides the details and guidelines for closing procurements.