NH CAPM - 6.10 Slides Student

CAPM® Exam
Preparation
PDU Course Number: OLLNHLSCAPMPREP6TH; ILTNHLSCAPMPREP6TH
PDUs: 28; PMI® R.E.P. Number: 1341
Author: Brian Salk, PhD, PMP®, PMI‐ACP®
Materials in this class are based on the Project Management Institute, A Guide to the Project Management Body of Knowledge, (PMBOK® Guide) ‐ Sixth Edition, Project Management Institute, Inc., 2017. PMI, PMP,
CAPM, OPM3, PMI‐SP, PMI‐RMP, PMI‐ACP, and PMBOK Guide are registered trademarks of the Project Management Institute, Inc.
CAPM® Exam Preparation
Version: 6.06
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CAPM® Exam Preparation Course Objectives
• Lecture, discussions, and guided questions to help
participants to identify project management terms,
concepts, and common practices as expressed by the Project
Management Body of Knowledge (PMBOK)® Guide Sixth
Edition.
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CAPM® Exam Preparation Course Topics
• Lesson 1: Project Management Introduction Page 12
• Lesson 2: The Environment in Which Projects Operate Page 41
• Lesson 3: The Role of the Project Manager Page 66
• Lesson 4: Initiating Processes Page 79
• Lesson 5: Planning Processes Page 94
• Lesson 5: Planning Processes, Section A – Management Plans Page 95
• Lesson 5: Planning Processes, Section B – Scope, Schedule, Resource,
and Cost Processes Page 168
• Lesson 5: Planning Processes, Section C – Risk Processes Page 229
• Lesson 6: Executing Processes Page 264
• Lesson 7: Monitoring and Controlling Processes Page 317
• Lesson 8: Closing Processes Page 392
• Appendices Page 410
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Exam: What to Expect, How
to Prepare
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PMP®/CAPM® Exam Details
PMP® CAPM®
Number of Multiple Choice 200 150
Questions (1 Correct Answer)
Exam Hours Four (plus 15 minutes for tutorial) Three (plus 15 minutes)
Price PMI Member: US $405 PMI Member: US $225
Non‐member: US $555 Non‐member: US $300
Prerequisites (leading and directing Secondary degree: 7,500 hours/ Secondary degree
projects.) 5 years PM Experience AND
Note: Secondary degree includes OR
high school diploma, associate’s Four‐year degree: 4,500 hours/ 23 hours PM education
degree or the global equivalent 3 years PM Experience OR
1,500 hours of project experience
35 hours of PM education
To maintain your certification Earn 60 professional development
6 PDUs
units (PDUs) every three years.
Overview of the Application Process
Become a PMI Member (optional)
Create an account, complete the application, and submit the application
PMI Review and Payment
Possible Audit
Take Exam within a Year
Maintain Your Certification
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Exam Registration and Environment: Scoring
• As of January, 2008, PMI has adopted industry
best practices and issues exam results of pass or
fail and, in the five sub‐domains, exam results of
proficient, mildly proficient, or lacking
proficiency. Our suggestion when doing exam
simulation is to be in the 80%+ range to create
some extra padding when taking the real exam.
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Exam Registration and Environment: Exam Objectives
• The exam consists of 150 questions, all of which you will want to
answer. Only 135 are scored. The remaining questions, which
are inserted randomly in the examination, are considered pre‐
test questions and are used to test the validity of future
questions.
• You have 3 hours to complete the exam.
• On average, you have 72 seconds per question.
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Exam Breakdown, Refer to PMI Website
Certified Associate in Project Management (CAPM)® Exam Content
Outline | PMI
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Exam Registration and Environment:
Question Formats
• The exam uses a number of question formats. Some of the questions
use multiple formats. Understanding the formats helps you dissect
the question and the available answers. Here are some formats:
Select Chicken or the egg (sequence)
Select NOT/EXCEPT Situational
All (or a combination of) the above Calculation
None of the above
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Exam Registration and Environment: Exam Questions
Question Formats (Cont.)
Question Description Example

Format
Select This is likely the most A milestone has what duration?
straightforward question A. 1 day
format on the exam. It simply B. 0 (no duration) (Correct)
asks you to select the best
C. 1 hour
answer. Be aware, however,
D. 8 hours
because it can also include
other question formats,
including the Chicken or the
Egg format questions.
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Question Format Description Example
Select NOT/EXCEPT For this the type of question, you must All the following are areas of

select the answer that does not apply. communications management except…
Generally, this question type is not a big A. Manage
deal unless you have already hit “the communications
wall” that we discussed in the exam B. Control communications
environment part of this book. The key C. Perform quantitative
to handling this type of question is to risk analysis (Correct)
determine which three answer
D. Plan communications
selections have something in common.
The fourth answer selection is the
exception and the answer to choose.
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All (or a With this question format, all Which of the following are areas of

Combination of) ‐‐ or a combination ‐‐ of the risk management?
the Answers answers are acceptable. The A. Identify risks
main thing to consider is that B. Perform quantitative
there isn’t a bad choice. The risk analysis
odds are that if two of the
C. Plan risk responses
answers (other than “All the
D. All the answers (Correct)
answers”) look good, so will
the third.
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Situational This question format is probably the most You’ve taken over an existing project and
challenging, and the exam will include at least discover that it has suffered major scope creep
75 questions using this format, some in because the former project manager couldn’t
combination with other formats. This say “no” to the sponsor, and it lacked enough
question format expects you to leverage your supporting documentation. What document do
PM experience and understanding of the you first want to see (or create if it doesn’t
PMBOK Guide and the PMI way of thinking. exist) about the project foundation?
Typically, you will see a Chicken or the Egg A. Risk list
(what comes first) ‐‐ with whom do you B. Project charter (Correct)
communicate regarding a project, or what is C. Communications plan
your next action on the project. Keys to
D. Budget
success in this area are to understand the
processes table in section 3.8.1 of this book,
plus the key role players in the methodology.
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Chicken or the Egg With this format, more than one What comes before sequence activities?

answer is acceptable. The key is A. Estimate activity
to understand the order ‐‐ what durations
comes first, last, before B. Estimate costs
something, or after C. Define activities (Correct)
something. In this case, look at D. Develop project
what the question is asking and management
determine the best answer based plan
on the timeline of the answers.
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Question Description Example

Format
Calculation This question format typically falls under the Select or the What is the CPI for the
None of the Above (sometimes “not enough information”) following data? AC=$200,
formats. If you know the formulas for the exam, you PV=$400, EV=$200,
shouldn’t have a problem with calculation questions. In BAC=$1,000
some, you could encounter possible answers that “add up” A. $200
correctly if you don’t know the formula, but attempt to B. ‐$200
reverse‐engineer the question. An example: you are to
C. 1.0 (Correct)
calculate CPI (divide EV by AC). You have incorrect answers
D. 0.5
that total other calculations as well (SP, SPI, CV, or others).
It is not uncommon for the exam to have questions that do
not give you enough data, such as future value or present
value. Therefore, it is important that you know all the
components of a formula.
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Question Characteristics Intended to Throw You Off
• There are different characteristics and
components you must recognize when
interpreting questions, especially the situational
ones. They include distracters, common
terminology, too much information, and wrong
area/point in time.
• If you recognize them in the questions, you may
determine more easily what the question is
actually asking.
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Question Characteristics and Components (Cont.)
Question Type Explanation
Distracter We use this word to reference information that has no value
or bearing in a question. We call it a distracter because it is
content that has been inserted to distract you in the exam
environment. We also call such content “noise.”
Common The exam typically uses PMI terminology. A question could
Terminology have one possible answer commonly connected with the
question but not PMI terminology. Another possible answer
uses the PMI terminology for the common description (e.g.,
budget at completion vs. budget). In this example, if you
answered “budget” because you weren’t familiar with the
true definition of “budget at completion,” you are technically
wrong because “budget at completion” is the better answer.
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Question Characteristics and Components (Cont.)
Question Type Explanation
Too Much Information The exam could present questions that contain a great deal of information.
(TMI) For example, you might encounter a situational question in which a number
of variables are included, such as time, cost, scope, and quality. Look at
each variable and see how it relates to what the question is asking. For
example, if you are given reasonable variables associated with time, quality,
and scope, but the cost variable shows that you are over budget, then the
cost variable is likely the one you that should concern you.
Wrong Area, or Wrong The exam could present questions that have an answer or answers that are
Point in Time from the incorrect knowledge area or are from the correct knowledge area
but occur too early or too late in the process to be acceptable. The
questions could also ask you to determine process or activity sequence (e.g.,
which of the following activities would you perform first?).
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Preparing for Exam Day
Practice Exams Practice tests help you become familiar with the environment, as well as the

question layout and timing.
When taking practice tests, focus on the speed at which you complete the
questions. Your mind will be accustomed to processing questions at a pace
that is above normal, and to recognize the questions types and characteristics.
Study Read the PMBOK guide cover to cover
Read the student guide provided in this course
Might I also recommend the app called PocketPrep for CAPM:
http://www.pocketprep.com/exams/pmi‐capm/
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Exam Registration and Environment: General Tips
• ****The exam tests your understanding of the PMBOK Guide and
PMI processes across all knowledge areas, as well as the ability to
know how to deal with these processes in situational questions.
• Know the formulas that are in the PMBOK.
• Know the terms and definitions.
• Know the acronyms that PMI uses.
• Be familiar with documents purposes, and when they are inputs vs.
outputs. You won’t be asked to create them, nor will there be details
on how they should look etc.
• The CAPM Examination can include questions with absolute words
such as ALWAYS, NEVER, COMPLETELY, and gray words, such as
SOMETIMES, SHOULD, COULD, GENERAL, and MAY.
• Be very sensitive to these words because absolute words compared to
gray words can significantly change the meaning of a question.
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Exam Registration and Environment: More General Tips
•Study often: aim for 1 to 3 hours per work day and 4 to 8
hours each weekend day.
• Spaced practice and study is better than pure cramming.
•Study consistently: the volume of material makes it harder
if you wait too long between study sessions.
• Test sooner rather than later: the volume of material
makes it harder to pass the exam if you wait months to
take the exam.
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Exam Registration and Environment: Preparing for Exam Day
Scheduling and Schedule your exam for a time when you are most alert. Try not to
the Day Before schedule your exam to follow a day's work. A good night's sleep the night
before the exam and eating well a few days before will help greatly.
Cramming the day before is not a bad idea. It can help you detect any
final subject areas that need last minute study.
Brain Dump A brain dump is important information that you write down as you begin
your CAPM Examination. We recommend that you write down your brain
dump during the tutorial of the exam. This tutorial occurs in the first
fifteen minutes before your three hours actually start. Ensure that you
can do this cold in fifteen minutes or less before you take the test.
***I recommend you memorize the Process Group and Knowledge Area
Mapping table on page 25 of your PMBOK.
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Exam Registration and Environment: Exam Day
What to Take: The following are required:
Required  Your eligibility letter with the authorization number on it
 A photo ID and two other forms of ID (credit card, etc.)
Verify that the names on the IDs and the letter are identical. For example,
Anthony and Tony could cause problems.
What to Take: • Dress in layers so you can be comfortable in the room environment whether it be
Recommended cold, warm, or unstable. A t‐shirt with a sweater is a good combination.
• Although you may take food and drink, you must leave them in the provided locker.
• You may take the locker key plus the provided pencils and paper into the test room.
• May be “white board” and dry erase markers – ask for fine tipped.
• The lockers can be small.
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Exam Registration and Environment: Exam Day (Cont’d)
Marking The exam lets you mark questions and return later to review them.

Questions for Studies show that your initial response to a question is usually the
right answer. While we suggest marking questions you are unsure
Later about, and perhaps math questions, we recommend that you don't
mark too many questions, and make sure you put an answer down
even if you mark it for review … better to have something than
nothing if you run out of time.
Typically, our classroom students who score well on the exam mark
about ten to fifteen questions.
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Online Proctored Exams are Now Available
• You can find out more here:
• https://www.pmi.org/certifications/types/certified‐
associate‐capm/exam‐prep/online
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Lesson 1: Project
Management Introduction
Learning Objective: Based on Chapters 1‐3 of the PMBOK® Guide
Sixth Edition.
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Lesson 1 Topics: Project Management
Introduction
• Defining Projects (1.2.1) • Project Management
• The Importance of Project Knowledge Areas
Management (1.2.2) • Project Data, Information, and
• Project, Program, Portfolio and Reports
Operations Management • Tailoring
(1.2.3) • Project Management Business
• Key Components (1.2.4) Documents (1.2.6)
• Project Management Process • Success Measurements
Groups
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Defining Projects (1.2.1)
• Developing a unique product, service, or result
• Temporary endeavor
• Definitive beginning and end
• Incorporating repetitive elements, as necessary
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The Importance of Project Management
(1.2.2)
• Effective project management increases the probability of
• Successful project execution
• The creation of tangible and intangible value
• The accomplishment of organizational goals
• Poor project management increases the probability of
• Wasted effort, materials, facilities and/or money
• Missed opportunities
• Failure to avoid or mitigate internal and external risks
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Project, Program, Portfolio and Operations
Management (1.2.3)
Mission statement or
vision statement
Strategic plan
Portfolio
Mega
Operations Program 1 Program 2
Project 1
Project 1 Project 2 Project 3 Project 4
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Portfolio vs. Program – Real World Example
City Center in Las Vegas, Nevada, originally owned by MGM Resorts International, is 5 hotels combined into one area.
The program took 5 years from conception, and included at least 5 projects. From left to right: Mandarin Oriental, Crystals,

Aria, Veer Towers, and Vdara.
MGM Resorts International’s Portfolio includes other casino resorts being planned/built internationally.
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Key Components (1.2.4) (1 of 2)
• Project life cycle
• Predictive: plan ahead completely and then execute, usually for a
well known opportunity/problem and solution
• Iterative: cycles of planning, executing, and client evaluations
• Incremental: adding additional scope (e.g. features) over time
• Adaptive (e.g., agile): can use iterative and incremental approaches
• Hybrid: using predictive lifecycles for predictable elements and agile
lifecycles for less well‐defined elements
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Types of Life Cycles‐ Predictive Life Cycle
• Predictive life cycles are also known as waterfall or plan
driven approaches.
• In the predictive life cycle the scope, schedule, and budget
are established as early as possible in the project.
• This approach is often used when the work is well
understood by the performing organization.
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Types of Life Cycles‐ Iterative, Incremental, Hybrid Life Cycles
• Iterations develop the product through a series of repeated cycles
• Increments successively add to the functionality of the product
• In iterative or incremental life cycles, project scope is identified
early in the project, but schedule and budget are adjusted as the
team learns more about the project work. Iteration durations and
team members may change based on project need.
• This approach is typically used when the goal is to minimize
complexity and risk, or when partial project delivery can benefit
some of the stakeholders.
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Types of Life Cycles‐ Adaptive Life Cycles
• Adaptive life cycles are also known as agile methods
and are generally thought of as a change‐driven
approach to project management.
• This approach has rapid iterations, typically 2‐4
weeks long with fixed time and resources, and
requires significant stakeholder/customer
involvement.
• This approach is often used in rapidly changing
project environments where the scope is difficult to
define in advance.
•
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Key Components (1.2.4) (2 of 2)
• Project phases within Project Life Cycle
• Each phase represents a logical element or component of the overall project. For example,
an organization could us a project life cycle consisting of the phases Analysis, Design,
Develop, Implement, and QA to guide their work.
• Phase gate
• A review process, typically conducted at the end of a project phase, to decide whether to
keep going on the project, or to “kill” it. For example, the project team might require
permission from the sponsor or customer before they can begin the work of the next project
phase.
• Project management processes
• Often, but not always, project management processes convert data or information (inputs)
into useful documents (outputs).
• There are 49 processes to represent the actions required to conduct the project!
• The majority of the PMBOK revolves around these processes and organizes them into
Process Groups and Knowledge Areas.
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Project Management Life Cycle:
Process Groups and Knowledge Areas
Monitoring and
Knowledge Areas Initiating Process Planning Process Executing Process Closing Process
Closing Process
Group Group Group Group
Group
4. Project 4.1 Develop Project 4.2 Develop Project 4.3 Direct and 4.5 Monitor and 4.7 Close Project or
Integration Charter Management Plan Manage Project Control Project Phase
Management Work Work
4.4. Manage Project 4.6 Perform
Knowledge Integrated Change
Control
5. Project Scope 5.1 Plan Scope 5.5 Validate Scope
Management Management 5.6 Control Scope
5.2 Collect
Requirements
5.3 Define Scope
5.4 Create WBS
Project Management Institute, A Guide to the Project Management Body of Knowledge, (PMBOK® Guide) ‐ Sixth Edition, Project Management
Institute, Inc., 2017, page 25.
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Project Life Cycle vs. Project Management Life Cycle
Analysis Phase Design Phase Develop Phase

Initiating Initiating Initiating
Planning Planning Planning
Executing Executing Executing
Monitoring & Monitoring & Monitoring &
Controlling Controlling Controlling
Closing Closing Closing
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Project Management Life Cycle
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Project Data, Information, and Reports
Reports
Work Performance “Activity A cost $10 less than planned, and this is favorable”
Information
Data Analysis (Tool or Technique)
Work Performance Data “Activity A cost $100”
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Exercise: Data, Information, and Reports
• Answer the following questions:
1. Is, “We’re ahead of schedule by 1 day” data or information?
2. Is, “We found two quality defects” data, information?
3. Generally, would a highly useful report contain primarily data or
information?
4. True or false: project reports should optimally include all work
performance information so stakeholders can determine for
themselves what’s important.
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Exercise Answers: Data, Information, and
Reports
1. “Ahead of schedule by 1 day” is information.
2. “Two quality defects” is data.
3. Generally, a highly useful report contains primarily
information.
4. False
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Tailoring (1.2.5)
• PMBOK® Guide not a methodology
• Several project management methodologies from many
sources ( Specifics not a requirement for CAPM exam)
• E.g. Agile, Six Sigma, Waterfall, Scrum
• Tailoring project management methodologies for each
project can increase team’s efficiency and likelihood of
project success.
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Project Management Business Documents
(1.2.6) (1 of 2) These 3 documents are considered “pre‐project work”
• Needs assessment: examines the gaps between an organization’s
current state and desired state
• Usually conducted prior to formally authorizing a project with a project
charter
• Project business case: documents the expected benefits of a project;
often used to approve a project prior to more detailed planning and
subsequent execution
• Potentially included as part of the needs assessment
• Project benefits management plan: describes the process for creating,
maximizing, and sustaining the project’s expected business benefit
• Can describe the alignment of targeted, measurable project benefits to
business benefits, expected timeframe to achieve the benefits, and benefits
owner
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Project Management Business Documents
(1.2.6) (2 of 2)
• Project charter: formally authorizes the project and
empowers the project manager (see section 4.1 of the
PMBOK® Guide)
• Project management plan: describes how the project
management team will execute, monitor and control, and
close the project (see section 4.2 of the PMBOK® Guide)
• Many other plans will be made throughout the project life cycle,
called subsidiary plans.
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Lesson 1 Review: Project Management
Introduction
• PMP®/CAPM® Test‐Worthy • Project Management
Topics: Project Management Knowledge Areas
Introduction • Project Data, Information, and
• Defining Projects Reports
• The Importance of Project • Tailoring
Management • Project Management Business
• Project, Program, Portfolio and Documents
Operations Management • What Are Your Questions?
• Key Components
• Project Management Process
Groups
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Lesson 2: The Environment in
Which Projects Operate
Learning Objective: based on Chapters 1‐3 of the PMBOK® Guide
Sixth Edition.
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Lesson 2 Topics: The Environment in Which
Projects Operate
• PMP®/CAPM® Test‐Worthy Topics: The Environment in Which
Projects Operate
• Enterprise Environmental Factors (2.2)
• Organizational Process Assets (2.3)
• Organizational Systems (2.4)
• Governance Frameworks (2.4.2)
• Management Elements (2.4.3)
• Organizational Structure Types (2.4.4)
• Project Management Office
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Enterprise Environmental Factors (2.2)
Factors beyond the team’s control, and these factors can help or hinder the project
Organizational
Marketplace
Culture
Human Physical / Social &

Geography
Resources Environmental Cultural
Internal External
Commercial Regulations &
Technology Infrastructure
Databases Standards
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Organizational Process Assets (2.3)
Assets specific to the organization performing the project that can both help and constrain the project team
Policies Financial
Methods Procedures
Structural
or Project Knowledge Lessons
Docs Learned
Governance Base
Factors
Guidelines Processes
Issues &
Templates Defects
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Exercise: Enterprise Environmental Factors
and Organizational Process Assets
Identify whether each of the following options is an enterprise environmental
factor or an organizational process asset, and which type (i.e. Internal,
External, Structural, Knowledge Base).
1. The steps and passing score for an internal project quality audit
2. Sagging market demand for certain types of products
3. Regulations regarding financial reporting
4. Actual costs of a previous project within our organization
5. The status reporting process
6. The decision‐making authority typically given to project managers
7. IT systems that provide project schedule functionality
8. Project life cycle templates
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Exercise Answers: Enterprise Environmental
Factors and Organizational Process Assets
1. The steps and passing score for an internal project quality audit. OPA (Structural)
2. Sagging market demand for certain types of products EEF (External)
3. Regulations regarding financial reporting EEF (External)
4. Actual costs of a previous project within our organization OPA (Knowledge Base)
5. The status reporting process OPA (Structural)
6. Decision‐making authority frequently given to project managers EEF (Internal)
7. IT systems that provide project schedule functionality EEF (Internal)
8. Project life cycle templates OPA (Structural)
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Governance Frameworks (2.4.2)
• Governance/Structural elements strive to direct employee
and management behavior towards organizational goals.
Examples include (Note that many of these elements include
enterprise environmental factors and organizational process
assets).
• Processes
• Rules
• Policies
• Procedures
• Systems (e.g., automated)
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Management Elements (2.4.3)
• Management elements also direct employee and
management behaviors towards organizational goals.
Examples include
• Grouping employees with specialized skills
• Providing them with appropriate resources
• Delegating authority to make decisions
• Specifying who makes specific types of decisions
• Clarifying that organizational goals override departmental goals,
which override individual goals
• Compensating and treating people fairly
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Organizational Structure Types (2.4.4)
• Organizational structure type refers to the arrangement of
people into groups and reporting responsibilities.
• Aligning the organizational structure to the nature of the
organization’s industry, mission, vision, and overall culture
(e.g., views of leadership) increases the likelihood of
achieving project and organizational goals.
• Many types of organization structures exist, including:
• Organic, functional, matrix, project‐oriented, PMO, and hybrid.
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Organizational Structure Types (2.4.4)
Organizational structures organized to show which provides the least to the most amount of power and
authority to project managers
Organic,
functional, and
multi‐divisional
(little or none)
Weak matrix
(low)
Balanced matrix and virtual
(low to moderate)
Strong matrix
(moderate to high )
Project‐oriented, and PMO
(high to almost total)
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Organizational Structure Types: Organic
Involves people working together flexibly to accomplish common goals. A small, family‐owned organization
could be an example of an organic organization.
Project
Owner Employee
coordinator
Project
Employee
coordinator
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Organizational Structure Types: Functional
Generally departmentalize similar types of resources (e.g., engineering, manufacturing, accounting), and most resources
work on functional or operational activities the majority of the time. The role of a traditional project manager generally
doesn’t exist within a functional organization, as this type of organization runs few projects, and those projects generally run
within a single department. An organization that performs mostly repetitive activities, such as a restaurant or department
store, could organize itself functionally.
CEO
HR Manager Sales Manager
Project
Employee
coordinator
Project
Employee
coordinator
Employee Employee
Note: coordinators also have functional responsibilities 61
Organizational Structure Types: Multidivisional
Essentially, a multidivisional organization consists of two or more functional organizations, with great independence
between those organizations (i.e. geographic locations, product types). Like the functional organization, a
multidivisional organization rarely employs full‐time project managers, and most projects occur within a single
department.
CEO
Division Division
Manager Manager
Sales Sales
HR Manager HR Manager
Manager Manager
Project
Employee Employee Employee
coordinator
Project
Employee Employee Employee
coordinator
Note: coordinators also have functional responsibilities
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Organizational Structure Types: Weak Matrix
Perform a small number of projects and a large volume of repetitive, operational activities. Most employees provide
functional or operational services. Employees running projects such as project coordinators likely have minimal power,
authority, and control over project human resources or funds. Communication is most complex in a Matrix.
CEO
Manager Manager Manager
Employee Employee Project

Coordinator
Project
Employee Employee
Coordinator
Note: coordinators also have functional responsibilities
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Organizational Structure Types: Balanced Matrix
Organizations that create a moderate number of new products per year as well as support those products. Project
managers and departmental managers generally possess equal power, as projects and operations provide relatively
equal benefit to the organization. Communication is most complex in a Matrix.
CEO
Manager Manager Manager
Project
Employee Employee
Manager
Project
Employee Employee
Manager
Note: employees are assigned to projects as needed
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Organizational Structure Types: Strong Matrix
Good fit for organizations that create many new products or services per year. Most employees work on projects, and
projects account for most of the organization’s expenditures. Project managers tend to have more power than
functional or operational managers due to the volume and importance of projects to the organization. Communication
is most complex in a Matrix.
CEO
Manager of Project
Manager Manager Managers
Employee Employee Project Manager
Employee Employee Project Manager
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Organizational Structure Types: PMO
PMO provides structure and governance for projects and coordinates resources and information between projects. For
clarity, the graphics used for this topic and the preceding Strong Matrix topic are virtually identical, with the minor difference
of renaming the Strong Matrix’s “Manager of Project Managers” as “PMO Manager.” It’s not uncommon for a department
with a Manager of Project Managers to organize itself as a PMO.
CEO
Manager Manager PMO Manager
Project
Employee Employee
Manager
Project
Employee Employee
Manager
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Project Management Office
• Organizational group that
• Ensures strategic alignment of projects and the actual delivery of the
organizational benefits
• Standardizes project management methodology, tools, and techniques, and
provides training on these assets
• Shares project human resources, technology resources, and lessons learned
• Varying degree of control and influence
• Supportive (low): shares best practices, tools, templates
• Controlling (moderate): requires the use of tools and templates
• Directive (high): directs the projects; project managers report to the PMO
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Organizational Structure Types: Project‐Oriented
Organizations likely perform a very large number of complex projects. Most human resources work on projects, and projects
account for most organizational spending. Project managers, accordingly, have large degrees of power and authority.
Commonly, these organizations have PMOs (not shown in the graphic) to oversee all project managers and provide
consistency between projects. Functional departments usually perform supporting roles. A project‐oriented organization can
experience significant turnover as projects end.
CEO
Project Manager Project Manager Project Manager

A B C
Project Team Project Team Project Team

Member Member Member
Project Team Project Team Project Team

Member Member Member
68
Organizational Structure Types: Virtual
A virtual organization consists of geographically distributed resources. Realistically, a virtual organization
might have any of the organizational structure types mentioned previously. This graphic shows a
balanced or strong matrix with a combination of managers, project managers, employees, and team
members.
Mexico Canada
Employee Team Member
USA USA
Employee HR Manager CEO Project Manager Team Member
Employee Team Member
69
Exercise: Organizational Structure Types
Assign the correct type: organic, functional, multidivisional, matrix, virtual, or project‐oriented.
1. Most of the organization’s activities involve performing highly specialized temporary and
unique endeavors, and project team members might have no “home” when the project
concludes.
2. Operational policies and procedures are highly refined, and employees find the work
predictable and stable, though the volume of work may change day to day.
3. Communication is the most complex.
4. North American‐based project leaders have difficulties collaborating with European project
leaders due to differing policies, processes, and documents.
5. Establishing and coordinating with project team members can be difficult due to
geographically dispersed and highly specialized employees who work on a variety of
different initiatives.
6. Though project team members get cross‐departmental experience, they may have more
difficulty getting visibility in their departments when they are working on projects.
7. Team members work together flexibly and sometimes inefficiently to achieve both project
and operational goals as few formal operational policies and procedures exist.
70
Answers – Organizational Structure Types
1. Most of the organization’s activities involve performing highly specialized temporary and
unique endeavors, and project team members might have no “home” when the project
concludes. Project‐oriented
2. Operational policies and procedures are highly refined, and employees find the work
predictable and stable, though the volume of work may change day to day. Functional
3. Communication is the most complex. Matrix
4. North American‐based project leaders have difficulties collaborating with European project
leaders due to differing policies, processes, and documents. Multidivisional
5. Establishing and coordinating with project team members can be difficult due to
geographically dispersed and highly specialized employees who work on a variety of different
initiatives. Virtual
6. Though project team members get cross‐departmental experience, they may have more
difficulty getting visibility in their departments when they are working on projects. Matrix
7. Team members work together flexibly and sometimes inefficiently to achieve both project
and operational goals as few formal operational policies and procedures exist. Organic
71
Lesson 2 Review: The Environment in Which
Projects Operate
• PMP®/CAPM® Test‐Worthy Topics: The Environment in Which
Projects Operate
• Enterprise Environmental Factors (2.2)
• Organizational Process Assets (2.3)
• Organizational Systems (2.4)
• Governance Frameworks (2.4.2)
• Management Elements (2.4.3)
• Organizational Structure Types (2.4.4)
• Project Management Office
72
Lesson 3: The Role of the
Project Manager
Learning Objective: Based on Chapters 1‐3 of the PMBOK® Guide
Sixth Edition.
73
73
Lesson 3 Topics: The Role of the Project
Manager
• PMP®/CAPM® Test‐Worthy Topics: The Role of the Project Manager
• Overview (3.1)
• The Project Manager’s Sphere of Influence (3.3)
• Project Management Competencies (3.4)
• Comparison of Leadership and Management (3.4.5)
• Leadership Styles (3.4.5)
• Performing Integration (3.5)
• PMP®/CAPM® Practice Questions
• What are your questions?
74
Role of the Project Manager: Overview (3.1)
• Responsible for achieving project’s objective and leadership of
team to accomplish organization’s objectives
• Provides leadership, planning, and coordination
• PMs role and responsibilities vary by organization: may be
involved before the project formally initiated (e.g., help craft
business case) and after the project closed (e.g., determine
actual business benefits)
• Can work with business leaders who provide project team
members
• Doesn’t have to be a technical expert, but familiarity with the
work important
75
The Project Manager’s Sphere of Influence
(3.3)
The organization The industry
• works with/influences a wide variety of • works with/learns from other professionals
organizational stakeholders to continually gain industry‐specific
knowledge, skills, and best practices
The project
Professional discipline Across disciplines
• continually learn/share evolving project • advocate the value of project management
management best practices to a wide variety of professionals in a variety
of settings
76
Project Management Competencies (3.4)
Project, program, and portfolio knowledge
Knowledge of the industry and the and skills. Understanding/applying the
organization’s vision, strategy, and project management processes found in the
goals. This involves a variety of
Strategic Technical PMBOK® Guide, as well as choosing the
knowledge/skills, such as general and project appropriate project methodology (e.g. agile)
business practices, and organization‐ Business mgt. for a given project.
specific factors (e.g., products, Mgt.
services, departments, competitors,
suppliers, market factors). This
enables the project manager to Leadership
work with internal and external
stakeholders.
Guiding, motivating, and directing a team
to accomplish an organization’s goals. Skills
in this area can include negotiating,
communicating, problem solving, critical
thinking, and interpersonal skills.
77
Comparison of Management and Leadership(3.4.5)
Management Leadership
Direct using positional power Guide, influence, and collaborate using relational
power
Maintain Develop
Systems and structures Relationships with people
Rely on control Inspire trust
Focus: near‐term goals Focus: long‐range goals
Ask how and when Ask what and why
Focus on bottom line Focus on the horizon
Accepts status quo Challenges status quo
Efficiency: doing things right Effectiveness: doing the right things
Focus: operations and problem solving Focus: vision, alignment, motivation, inspiration
Project Management Institute, A Guide to the Project Management Body of Knowledge, (PMBOK® Guide) ‐ Sixth Edition, Project Management
Institute, Inc., 2017, page 64.
78
Leadership Styles (3.4.5)
Laissez‐faire
• team make its own
Interactional decisions; minimal
oversight/guidance Transactional
• combination of
transactional, • Based on behavior of
transformational, team, reward/correct
charismatic leadership appropriately
Leadership
Styles
Charismatic
Servant Leadership
• demonstrating high
energy and • serve team needs
confidence to inspire first and leading the
the team Transformational team second
• demonstrating idealized
attributes and
characteristics
79
Performing Integration (3.5)
• Combining parts into a whole; involves systems thinking
• Project management examples
• Developing and releasing a product, service, or result that helps
the organization achieve its strategic goals
• Managing and leading team members and stakeholders with
differing backgrounds, skills, and motivations
• Understanding project management process interdependencies
• Incorporating new and changing environmental factors and trends
(e.g., new technologies, social networks, multicultural
organizations and teams, and virtual teams)
80
Test‐Worthy Agile Project Management Topics
• This slide may be inaccurate. Let’s look at the CAPM handbook from PMI (page 6, first paragraph).
• About PMI’s Credentials
• Looking in the PMBOK Index, there are 13 pages that mention Agile out of 756 pages.
• And yet, 6th edition exam seems a bit “Agile‐heavy” according to some test takers.
• To make up for this “disparity”, this means during the exam you’ll need to understand the driving needs in Agile Environments so you can better
answer unexpected Agile questions on the exam.
• OR… you can study the heck out of all the “extra” Agile Topics presented here in Pinnacle and in the “Agile Practice Guide” just in case.
• When preparing for the exam, be familiar with the following agile project management terms and concepts.
• Agile values and principles
• Lean perspective
• Life cycles; iterations and increments
• Roles and skills of agile project manager (servant leader; coach) versus traditional project manager
• Roles and skills of team members
• Roles and skills of product owner (customer)
• Collocation; face‐to‐face communications
• For more information on these agile topics and the location of agile practice questions, see below.
81
Lesson 3 Review: The Role of the Project
Manager
• PMP®/CAPM® Test‐Worthy Topics: : The Role of the Project Manager
• Overview (3.1)
• The Project Manager’s Sphere of Influence (3.3)
• Project Management Competencies (3.4)
• Comparison of Leadership and Management (3.4.5)
• Leadership Styles (3.4.5)
• Performing Integration (3.5)
82
PMP®/CAPM® Practice Questions: Lessons 1‐3
• Open the file PMP and CAPM Practice Questions.
• Using the Table of Contents, navigate (using CTRL+Click) to
the entry Lessons 1‐3: Framework Questions.
• Answer the odd questions (1,3,5 etc) and check your
answers. The answers follow the questions.
• Time to complete this exercise: 10‐15 minutes
83
Lesson 4: Initiating
Processes
Learning Objective: Based on the PMBOK® Guide Sixth Edition
Initiating processes.
84
84
Lesson 4 Topics: Initiating Processes
•PMP®/CAPM® Test‐Worthy Topics: Initiating Processes
•Initiating Process Group Overview
•Develop Project Charter (4.1)
•Identify Stakeholders (13.1)
•PMP®/CAPM® Practice Questions
85
Initiating Process Group Overview
• Consists of the processes to formally authorize a new project or phase
of a project that addresses the organization’s strategic plan
• Clarifies the stakeholders affected by the project and their
corresponding interests, levels of power, and involvement
• Involves high‐level planning
• Occurs more than once for high‐risk projects; usually at the beginning
of each phase of the project life cycle
• Typically leads to planning the project work in detail, not to executing
the work
• While the Project Charter ultimately affects most documents in project
management to some degree, pay attention to when the PMBOK lists it
explicitly as an input: For example, it is an input into the Develop Project
Management Plan process
86
Develop Project Charter Process
(PMBOK® Guide 4.1)
• Signed by significant stakeholders, the project charter describes the
high‐level details of the project, shows the organization’s commitment
to the project, and provides the project manager with authority.
• Important considerations:
• The project sponsor should contribute heavily to the drafting and approval
of the project charter.
• The sponsor should possess sufficient political power to avoid or overcome
potential political problems later in the project.
• The intended project manager and relevant stakeholders should help draft
the project charter.
• The project charter should incorporate lessons learned from past projects,
which provide the foundation for the project’s high‐level implementation
strategy.
• Stakeholders should be informed once the project charter is approved.
87
Develop Project Charter: Key Output
Purpose,
success criteria Key requirements,
Project exit criteria deliverables, and
boundaries
High‐level
Sponsor Project Charter schedule and
budget
Project manager Overall risk
Key stakeholders
88
Develop Project Charter: Key Inputs, Tools
and Techniques, Outputs
Expert judgment
Business case Project
Data gathering methods
Agreements charter
Interpersonal and team skills
Project Management Institute, A Guide to the Project Management Body of Knowledge, (PMBOK® Guide) ‐
Sixth Edition, Project Management Institute, Inc., 2017, page 75.
89
Identify Stakeholders (PMBOK® Guide 13.1)
• Identifying the individuals, groups, and organizations affected or
impacted by or who can impact the project, and determining their
interests, involvement, interdependencies, and potential impact on
the project
• Sets the foundation for engaging those stakeholders.
• Following the Identify Stakeholders process, there is the Plan Stakeholder
Engagement process in which the Stakeholder Engagement Plan is created to
map out how to keep the key stakeholders involved and supportive. (More on
this in another lesson).
• Begins very early in the project, and performed at least once when
initiating a new project as a whole, and potentially when initiating
each new phase of the project
• Stakeholders may or may not be actively involved.
90
Identify Stakeholders: Key Outputs
• Stakeholder register, consisting of the following types of
information:
• Stakeholder identification information
• Stakeholder assessment information
• Stakeholder classification
• Change requests (e.g., All considered vendors charge more than
our original cost estimate, so we ask for more of project budget)
• Updates to the project management plan for any approved
changes
• Updates to other project documents like the risk register or the
assumptions log related to these stakeholders
91
Identify Stakeholders: Key Inputs, Tools and
Techniques, Outputs
Data gathering methods
Business case &
(e.g., brainstorming, Nominal Group, questionnaires) Stakeholder register
benefits mgt. plan
Data Representation Change requests
Project charter
(e.g., Power/Interest Grid, Updates Project Plan
Agreements
Salience model, 2‐D charts, 3‐D stakeholder cube) Updates other docs
Project mgt. plan
Stakeholder Analysis
Project Management Institute, A Guide to the Project Management Body of Knowledge, (PMBOK® Guide) ‐ Sixth
Edition, Project Management Institute, Inc., 2017, page 507.
92
Example of Power/Interest Grid
93
Example of Power and Interest Chart
Power and Interest Grid
5
4.5
4 Sponsor
3.5
3
Project
Power
Manager
2.5
1.5
End
Users
1
0.5
0
0 0.5 1 1.5 2 2.5 3 3.5 4 4.5 5
Interest
94
Example of Salience Model
Power: Is the ability project stakeholders has to
influence the outcome of an organization, deliverables,
or a project
Legitimacy: Is the authority and level of involvement
project stakeholders have on a project.
Urgency: Is the time expected by project stakeholders
for responses to their expectations.
95
Salience Model: Deeper Dive
1. Dormant
1 2 2. Discretionary
Power 4 Legitimacy
3. Demanding
4. Dominant
7
5 6 5. Dangerous
6. Dependent
Urgency 7. Definitive
8. Non‐
8 stakeholder
3
(Sharma, 2010)
96
• Again, this slide may not be accurate. Instead, refer to the PMI
Handbook and the PMBOK:
• https://www.pmi.org/certifications/types/certified‐associate‐
capm/exam‐prep
• When preparing for the exam, be familiar with the following agile
project management terms and concepts.
• Product (or project) vision statement or elevator speech
• Entire team assigned during the Initiating Process Group
• For more information on these agile topics and the location of
agile practice questions, see below.
97
Lesson 4 Review: Initiating Processes
•PMP®/CAPM® Test‐Worthy Topics: Initiating Processes
•Initiating Process Group Overview
•Develop Project Charter (4.1)
•Identify Stakeholders (13.1)
•PMP®/CAPM® Practice Questions
•What are your questions?
98
PMP®/CAPM® Practice Questions: Initiating
Processes
the entry Lesson 4: Initiating Processes Questions.
• Answer the odd questions and check your answers. The
answers follow the questions.
99
Lesson 5: Planning
Processes
Planning processes.
100
100
Lesson 5: Planning Processes,
Section A – Management Plans
Overview
101
101
Lesson 5: Planning Processes, Section A Topics –
Management Plans
• PMP®/CAPM® Test‐Worthy Topics: • Plan Communications
Initiating Processes Management (10.1)
• Planning Process Group Overview • Plan Risk Management (11.1)
• Develop Project Management Plan • Plan Procurement Management
(4.2) (12.1)
• Subsidiary Management Plans • Plan Stakeholder Engagement
• Plan Scope Management (5.1) (13.2)
• Plan Schedule Management (6.1) • Change Management Plan and
Configuration Management Plan
• Plan Cost Management (7.1) (4.2)
• Plan Quality Management (8.1) • PMP®/CAPM® Practice Questions
• Plan Resource Management (9.1)
102
Planning Process Group Overview
• Consists of the processes that define the scope, schedule,
cost, quality, and other factors of the project
• Describes how the team will accomplish the high‐level
objectives and solution described in the Initiating Process
Group
• Culminates in the approval of a detailed project
management plan, consisting of
• Four baselines (scope, schedule, cost, and performance
measurement)
• Subsidiary management plans
103
Develop Project Management Plan Process
(PMBOK® Guide 4.2)
• Involves the creation of an integrated project management
plan that defines all aspects of the project work
• As mentioned, consists of four baselines (scope, schedule,
cost, and performance measurement) and subsidiary
management plans
• **Requires the completion of many other Planning Process
Group processes to finalize the baselines and the subsidiary
management plans
104
Develop Project Management Plan: Detailed Inputs/ Outputs
Scope Mgt. Plan Communication Mgt. Plan
Requirements Mgt. Plan Risk Mgt. Plan
Schedule Mgt. Plan Subsidiary Mgt. Procurement Mgt. Plan
Cost Mgt. Plan Plans Stakeholder Engagement Plan
Quality Mgt. Plan Change Mgt. Plan
Resource Mgt. Plan Configuration Mgt. Plan
Project Mgt. Plan
Performance
Baselines Scope
Measurement
Cost Schedule
This is obviously not created by one person – the PM and the team should create
this together – though the PM assumes accountability for creating a realistic plan.
105
Subsidiary Management Plans
Change Mgt.
Plan
Stakeholder 4.2.3.1 Configuration
Mgt. Plan Mgt. Plan
13.1.3.1 4.2.3.1
Procurement
Scope Mgt. Plan
Mgt. Plan
5.1.3.1
12.1.3.1
Subsidiary Requirements
Risk Mgt. Plan
Mgt. Plan
11.1.3.1 Mgt. Plans 5.1.3.2
Commun. Mgt. Schedule Mgt.
Plan Plan
10.1.3.1 6.1.3.1
Resource Mgt.
Cost Mgt. Plan
Plan
7.1.3.1
9.1.3.1 Quality Mgt.
Plan
8.1.3.1
106
Develop Project Management Plan: Key
Inputs, Tools and Techniques, Outputs
Expert judgment
Project charter Data gathering
Outputs of Interpersonal and team skills Project
other processes Management Plan
Meetings
OPAs
(Kickoff Meetings signify end of Planning Process Group on
big projects)
107
Plan Scope Management Process
(PMBOK® Guide 5.1)
• Part of the Project Scope Management Knowledge Area, which
includes the processes that help the project team define and control the
work and deliverables included in (as well as excluded from) the project.
• Plan Scope Management involves the creation of the scope
management plan and the requirements management plan that
describe how the team will perform all other processes in the Project
Scope Management Knowledge Area, including:
Initiating Planning Executing Monitoring & Closing
Controlling
Collect Requirements (5.2) Validate Scope (5.5)
Define Scope (5.3) Control Scope (5.6)
Create WBS (5.4)
108
Project Scope Management Key Concepts
(PMBOK® Guide 5)
• Product scope: the features and functions that characterize a
product, service, or result;
completion measured against the product requirements
• Project scope: the work performed to deliver a product,
service, or result with the desired features and functions;
completion measured against the project management plan
• For predictive life cycles, scope generally locked down during
planning to minimize unnecessary downstream changes, false starts,
and rework
• For agile life cycles, scope progressively elaborated during the
planning portion of each iteration
109
Project Scope Management Key Concepts
(PMBOK® Guide 5)
• Requirements: measurable and testable characteristics of a
product, service, or process
• Deliverables: tangible work products or capabilities to perform a
service
• Requirements drive deliverables!
110
Plan Scope Management: Key Outputs
Documents how subsequent processes in the
Knowledge Area Project Scope Management
will be performed. Documents decisions such
as:
Scope mgt. • How and when will scope statement and
plan WBS be documented
• Who will document scope and WBS
• How will completed deliverables be
approved
Plan Scope • How will team control possible changes
Management
outputs
Documents how team will manage numerous
requirements over life of project. Documents
decisions such as
• How and when will requirements be Requirements
documented mgt. plan
• Who will document requirements
• How will requirements be approved
• How will team control possible changes 111
Plan Scope Management: Key Inputs, Tools,
Project charter Expert Judgement Scope mgt. plan

Data Analysis Requirements mgt.
Project mgt. plan Meetings plan
Project Management Institute, A Guide to the Project Management Body of Knowledge, (PMBOK® Guide) ‐ Sixth Edition,
Project Management Institute, Inc., 2017, page 130.
112
Plan Schedule Management Process
(PMBOK® Guide 6.1)
• Part of the Project Schedule Management Knowledge Area, which
includes the processes that help the project team create and control a
realistic and optimized timeline to complete the agreed‐upon work.
• The first process in this knowledge area, Plan Schedule Management,
involves the creation of the schedule management plan that describes
how the team will perform all other Project Schedule Management
processes, including:
Controlling
Define Activities (6.2) Control Schedule (6.6)
Sequence Activities (6.3)
Estimate Activity Durations (6.4)
Develop Schedule (6.5)
113
Project Schedule Management Key Concepts
(PMBOK® Guide 6) (1 of 2)
Scheduling Schedule Schedule

method baseline presentation
Scheduling • Locked‐down
• CPM • Gantt
• Agile method
tool • No changes • Network
without change diagram
control
• Milestone chart
114
Project Schedule Management Key Concepts
Plan‐driven or Scope
Resource Learning
agile complexity
experience curve
approach and risk
Realistic Reporting
Incentives
Schedule requirements
Work hours, Quantity of
Resource Scheduling
productivity, resources and
availability quality, morale
technology
productivity
115
Plan Schedule Management: Key Output
• Documents how subsequent processes in the Project Schedule
Management Knowledge Area will be performed. Documents
decisions such as:
• Who will create schedule.
• What tools will be used to create schedule.
• What sources of historical information available to create
schedule.
Plan • How will team control possible changes.
Schedule Schedule • Will team choose a plan‐driven or an agile approach.
Management mgt. plan
• Who will review schedule progress to determine schedule
output
performance, and how often will this be done.
• What are important measurement units for controlling
schedule, such as monitoring hours of effort, duration,
and/or milestones.
• What are thresholds related to controlling schedule, and
what are the corrective actions required when schedule
exceeds thresholds.
116
Plan Schedule Management: Key Inputs, Tools
Project charter Expert Judgement
Data Analysis Schedule mgt. plan
Project mgt. plan Meetings
117
Plan Cost Management Process
(PMBOK® Guide 7.1)
• Part of the Project Cost Management Knowledge Area, which includes
the processes that help the project team create and control a realistic
and optimized cost baseline and cost budget to complete the agreed‐
upon work.
• The first process in this knowledge area, Plan Cost Management,
involves the creation of the cost management plan that describes how
the team will perform all other processes in the Project Cost
Management Knowledge Area, including:
Controlling
Estimate Costs (7.2) Control Costs (7.4)
Determine Budget (7.3)
118
Project Cost Management Key Concepts
Estimating
project costs
Estimating Securing
Return On internal and/or
Investment external
funding
Project Cost
Mgt.
Optimizing Incorporating
project costs reporting
vs. operational standards and
costs regulations
Controlling
costs
119
• Cost baseline
• Approved project costs plus contingency reserves (for known risks)
• Part of the project management plan
• Cannot change without approved change request
• Project budget:
• Cost baseline plus management reserves (for unknown risks)
• Agile projects can estimate costs for each iteration
• A cost‐constrained project may not produce all scope
120
• Estimating and managing cost considerations include:
• scope complexity
• risk
• plan‐driven or agile approach
• reporting requirements
• availability of cost tools
• relationship between quality and cost
• resource availability
• learning curve impact
• impact of incentives on performance
• … and more …
121
Plan Cost Management: Key Output
• Documents how subsequent processes in the Project Cost
Management Knowledge Area will be performed. Documents
decisions such as:
• Who will estimate project costs.
• What tools will be used to create project cost
estimates/budget.
• What is process to lock down cost baseline and project
budget with project sponsor.
Plan Cost
Cost mgt. • What sources of historical information are available to
Management estimate costs, including labor, materials, supplies, facilities,
plan
outputs inflation, currency fluctuations, and other factors.
• How will team control possible changes.
• Who will review actual project spending and funding to
determine cost performance, and how often.
• What is the level of detail required for controlling and
reporting project costs, such as tracking costs to the nearest
thousands of dollars, hundreds of dollars, dollars, or pennies.
122
Plan Cost Management: Key Inputs, Tools and
Techniques, Outputs
Project charter Expert Judgement
Data Analysis Cost mgt. plan
Project mgt. plan Meetings
123
Plan Quality Management (PMBOK® Guide
8.1)
• Part of the Project Quality Management Knowledge Area that includes
the processes that help the project team achieve overall stakeholder
satisfaction by meeting stakeholders’ product and project requirements.
It also involves continuous project, product, and process improvement.
• This first process, Plan Quality Management, involves the creation of
the
• Quality metrics: measurable attributes that indicate stakeholder satisfaction
(e.g., number of defects, downtime per month, customer satisfaction scores)
• Quality management plan: describes how the team will perform all other
processes in the Project Quality Management Knowledge Area, including:

Controlling
Manage Quality (8.2) Control Quality (8.3)
124
Plan Quality Management: Key Concepts
Quality
objectives
Deliverables Quality roles
testing plans and
responsibilities
Quality Mgt.
Plan
Continuous
improvement Quality OPAs
and audit plans
Quality EEFs
125
Plan Quality Management: Key Inputs, Tools
Benchmarking
(Comparing our planned result against comparable entities)
Data gathering methods Quality
Project charter
Data analysis metrics
Project mgt. plan
(Cost/Benefit Analysis, Cost of Quality(Conformance and Nonconformance)
Other planning Decision making Quality
documents
(Multicriteria Decision Analysis)
mgt. plan
Data representation
(Flowcharts, Matrix Diagrams, Mind Mapping)
126
Cost of Quality (COQ)
Cost of Conformance Cost of Nonconformance
• Project money spent to avoid • Project and operational money
failures spent because of failures
• Prevention (build) costs • Internal failure costs
(e.g., training, documentation, (found by the project team; e.g.,
equipment) rework and scrap)
• Appraisal (assessment) costs • External failure costs
(e.g., testing, destructive test loss, (often found by the customer; e.g.,
inspections) liabilities, warranty work, loss of
business)
127
Multicriteria Decision Analysis
Criteria
Possible Solution Addresses Entire Schedule to Cost to Implement Risk to Implement Total
Problem? Implement (1‐5) (1‐5)
(1‐10) (1‐8)
Solution 1 4 8 4 3 19
Solution 2 5 7 3 2 17
Solution 3 7 3 1 5 16
Solution 4 10 4 4 2 20
Note: Higher scores indicate desirability. Thus, a solution that addresses the entire problem receives a 10 out
of 10. Similarly, a solution with a short schedule, a low cost and a low risk are desirable, and thus, it receives
higher scores for these criteria. Solution 4, with a total score of 20, is the most desirable solution.
128
Flowcharts (a.k.a. Process Maps)
Side Note: Be aware of SIPOC flowcharts.
Customer calls customer service
SIPOC (Suppliers, Inputs, Process, Outputs, Customers)
A particular type of flowchart, describes the entire
Agent determines problem and system flow from supplier to end customers, though it
provides solution emphasizes understanding customer needs first, then
working upstream to the suppliers to ensure the
system meets customer needs.
Customer
Satisfied? While it could be helpful for finding risks to quality, it is
Yes more often use to judge a process, or identify scope.
Service complete
129
Matrix Diagrams
Matrix diagrams show relationships between a variety of quality factors, such as requirements,
specifications, features, customer importance, risks, development costs, and development priorities.
Below is a simplified example that only pits Customer Requirements with Product Features.
Intended Features/Components
Customer Feature 1 Feature 2 Feature 3 Feature 4 Feature 5
Requirement
Requirement 1 X X
Requirement 2
Requirement 3 X X
Requirement 4 X X
130
Mind Mapping
131
Plan Resource Management Process
(PMBOK® Guide 9.1)
• Part of the Project Resource Management Knowledge Area, which includes the
processes that help to identify, acquire, develop, manage, and control the resources
(e.g., human, equipment, facilities) needed to complete the project work.
• The first process in this knowledge area, Plan Resource Management involves the
creation of two key outputs: the resource management plan and the team charter. The
resource management plan describes how the project management team will perform all
other processes in the Project Resource Management Knowledge Area, including:

Controlling
Estimate Activity Acquire Resources (9.3) Control Resources (9.6)
Resources (9.2) Develop Team (9.4)
Manage Team (9.5)
132
Project Resource Management Key Concepts
(PMBOK® Guide 9)
PM required skills for physical PM required skills for human
resources resources
• Just In Time (JIT) inventory management • Assessing team skills
• Order as needed • Conducting team building activities
• Because having more inventory than needed
introduces unnecessary costs associated with • Coaching and motivating team
inventory storage, obsolescence, and shrinkage members
• Theory of Constraints (Goldratt & Cox, 1992) • Recognizing and incorporating
• Involves locating and removing bottlenecks that cultural differences
limit throughput • Working with virtual teams
• Can be ideal for projects that involve the design
and development of operational products or • Negotiating, resolving conflict, and
services (e.g., manufacturing goods, call center employing politics
operations)
• Incorporating HR regulations and
• Critical Chain (Goldratt, 1997) constraints
• Similar to Theory of Constraints, only applied to
the project workflow
133
Plan Resource Management: Key Outputs (1 of 2)
How to identify
and acquire project
resources types
and quantities Roles, authorities,
Team member
rewards and responsibilities,
recognition plans and competencies
Resource Mgt.
Plan
Physical Project reporting
resources policies relationships
and practices
Team resource
management
information
134
Plan Resource Management: Key Outputs (2 of 2)
Team values
Communication
Team agreements guidelines
Team Charter
Meeting Decision making
guidelines processes
Conflict resolution
processes
135
Plan Resource Management: Key Inputs, Tools
Data representation techniques, including:
Project charter
1. Hierarchical charts Resource
Project mgt. plan mgt. plan
(e.g., OBS, RBS, Project Organizational Charts)
Project Team charter
2. Responsibility Assignment Matrices
documents
(RAM: e.g. RACI charts)
136
Organizational Breakdown Structures (OBS)
Shows deliverables, work packages, or activities, organized by the individuals (internal or
external) responsible for performing the work.
Project
IT Finance
Develop Provide
Systems Requirements
Test Systems Provide Sign‐off
137
Resource Breakdown Structure (RBS)
Shows all project resources in graphic form. An RBS generally provides reporting relationships between
human resources, but it also includes information related to other resources such as materials,
facilities, equipment, etc.
Project
Resources
People Materials Facilities Equipment
IT Finance Paper Test Lab Test Server
Conference High‐speed
Technicians Manager Ink Cartridges
Rooms Printer
Developers Finance SME
138
Project Organizational Charts
Shows authority levels and reporting relationships between project stakeholders.
Sponsor
Project
Manager
IT Team Finance
Lead Team Lead
Technicians Analyst
Financial
Developers
139 Planner
Responsibility Assignment Matrix (RAM);
RACI (Responsible/Accountable/Consulted/Informed)
Work Package Responsible Accountable Consulted Informed
Provide Business Analyst Lead Business Finance Manager Project Manager

Requirements Analyst
Develop System IT Technicians IT Manager External IT Analyst Project Manager,

Finance Manager Finance Manager
Test System Quality Control Quality Control N/A Project Manager

Manager
** Having 2+ people “Accountable” for the same work package usually a bad idea (confusion, conflict, blame game)
140
Plan Communications Management Process
(PMBOK® Guide 10.1)
• Part of the Project Communications Management Knowledge
Area, which includes the processes that help ensure the effective
flow of communications between project stakeholders. Effective
communications greatly improve the likelihood of project
success.
• The first process in this knowledge area, Plan Communications
Management, involves the creation of the communications
management plan. This document describes how the project
management team will perform all other processes in the Project
Communications Management Knowledge Area, including:
Initiating Planning Executing Monitoring & Controlling Closing
Manage Communications (10.2) Monitor Communications (10.3)
141
Project Communications Management Key
Concepts (PMBOK® Guide 10)
Important PM
Communication Dimensions communications skills
• Internal and external • Writing
• Formal and informal • Listening
• Horizontal and vertical • Public speaking
• Official and unofficial • Diversity
• Stakeholder expectation setting
• Motivating and coaching
• Persuading and negotiating
• Resolving conflict
• Social networking
142
Plan Communications Management: Key
Concepts
Information
communicated
Time and cost of Reason or benefit
communications
Communications
mgt. plan
When and how From whom
often
To whom
***The communications management plan may also specify particulars such as:
escalation paths, a glossary of common terms, and methods to update the communications
management plan itself. 143
Plan Communications Management: Key
Inputs, Tools and Techniques, Outputs
Expert judgment
Communications requirement analysis
Project charter
Communications technology
Project mgt. plan Communications
Communications model
Project mgt. plan
Communications methods
documents
Data representation
144
Communications Requirement Analysis:
Number of Communication Channels= N(N‐1)/2 (Where N = # of stakeholders)
3 Stakeholders; 3 channels 4 Stakeholders; 6 channels
N (N‐1)/2 3*(2)/2 = 3 N (N‐1)/2 4*(3)/2 = 6
145
Communications Model
Feedback
Loop
Sender Receiver
Idea Encoding Message Decoding Meaning
Noise
Perceptual Differences:
Words, Culture, Judgments,
Values, Emotions,
Personalities
146
Communication Methods
The methods utilized to share information among stakeholders can be
divided into three primary methods:
• Interactive: exchange of information between multiple parties and
fosters a common understanding between participants
I I
• Push: distribute information but does not ensure that the information I
was received or understood
• Pull: provide information in a centrally accessible location such as the
Internet I
147
Plan Risk Management Process
• Part of the Project Risk Management Knowledge Area, which includes
the processes that help to identify, analyze, respond to, and control
project uncertainties.
• This first process in this knowledge area, Plan Risk Management involves
the creation of the risk management plan that describes how the
project management team will perform all other processes in the Project
Risk Management Knowledge Area, including:
Controlling
Identify Risks (11.2) Implement Risk Monitor Risks
Perform Qualitative Risk Analysis (11.3) Responses (11.6) (11.7)
Perform Quantitative Risk Analysis (11.4)
Plan Risk Response (11.5)
148
Project Risk Management Key Concepts
• Project risk management involves evaluating and responding to risks in a
controlled fashion, and optimizing the time and cost of risk management
activities against the expected project rewards.
• Project risk activities should vary based on the specific project’s
magnitude, complexity, and development approach.
• Risks represent uncertainty (potentially desirable and undesirable events.)
• “Known unknowns” = Risks we successfully anticipate
• “Unknown unknowns” = Risks we didn’t anticipate
• Project risk management examines individual risks, the sources of risk, and
the overall project risk rating.
• ***The project management team should reevaluate all risks at least once
per phase of the project life cycle (plan‐driven projects) or once per
iteration/sprint (agile projects.)
149
Project Risk Management Key Concepts
• A positive risk is an opportunity; a negative risk is a threat.
• An example of a positive risk event is accommodating the growth
that results when the sales of a new product exceed expectations.
• An example of a negative risk is the reliance on a piece of software
that is not available when needed or as planned, forcing the team
to come up with an alternative.
150
Project Risk Management Emerging Trends
(PMBOK® Guide 11) • Non‐event risks involve the examination of
favorable/unfavorable events or decisions that may occur
during the project.
Non‐event • Variability Risks: aspect of a planned task is uncertain
risks • Ambiguity Risks: lack of knowledge
• Emergent Risks: limitations in our conceptual
frameworks or world‐view (“unknown unknowns”)
• Project resilience entails preparing the project and the
project team to more effectively accommodate “unknown
Emerging unknowns” through methods such as allocating additional
trends reserve time/money, and empowering the team to make
decisions.
Integrated Project • Integrated risk management involves the development of
risk mgt. resilience organization‐wide, coordinated, systematic, and consistent
risk management processes, policies, and procedures.
151
Plan Risk Management: Key Concepts
Strategy and
methodology
Reporting, Funding and
tracking, auditing, timing
improving
Risk Mgt. Plan
Terms, scales,
and scale Risk categories
definitions
Stakeholder risk
appetites /
thresholds
152
Risk Appetites
Type Description
Risk‐averse Risk‐averse is a mentality of risk avoidance. Selecting the

low risk item or the sure thing is typical in this case.
•
Risk seeker Risk seeker is a mentality of looking for risk, or worse case,

not being afraid of it. This is typically the early adopter of
new products, or the person or company that is willing to go
•
for an all or nothing approach to an initiative.
Risk‐neutral Risk‐neutral is a middle ground mentality toward risk. It can
shift toward either seeker or averse, depending upon the
situation but usually falls in the middle.
153
•
Risk Breakdown Structure (RBS)
Provides a method to visually display project risks by category. The simplified graphic on
this page shows three categories of risk: scope, schedule, and business risks. Hundreds of
categories of risk exist.
Project risks
Scope risks Schedule risks Business risks
1.1 Unclear 2.1 Material 3.1 New

requirements delays competitors
3.2 Changing
1.2 Lack of 2.2 Decision
consumer
team expertise delays
tastes
154
One Way to Identify Risks: Fishbone Diagram
(a.k.a. Cause and Effect, a.k.a. Ishikawa Diagram)
Also good for finding root
cause of problems, and
other uses
155
Probability and Impact Assessment;
Probability and Impact Chart
Probability and Impact
Assessment Probability and Impact Chart
Risk Probability Impact Rating High
(1‐5) (1‐5) (P * I)
Risk 1 3 4 12
Risk 2 2 3 6
Probability
Low
Low Impact High
156
Plan Risk Management: Key Inputs, Tools and
Techniques, Outputs
Project charter
Expert judgment
Project mgt. plan Risk
Data analysis
Other project mgt. plan
Meetings
documents
157
Plan Procurement Management Process
• Part of the Project Procurement Management Knowledge Area,
which includes the processes that help the project management
team or other relevant stakeholders to obtain products and
services from outside the organization.
• This first process in this knowledge area, Plan Procurement
Management, involves the creation of numerous outputs. One of
these outputs, the procurement management plan, describes
how the project management team will perform the other
processes in the Project Procurement Management Knowledge
Area, including:
Conduct Procurements (12.2) Control Procurements (12.3)
158
Project Procurement Management Key
Concepts (PMBOK® Guide 12)
• General procurement concepts apply to legally binding contracts, Service Level
Agreements (SLAs), Memorandums of Understanding (MOA), and purchase
orders.
• Procurement introduces complexities and risks for the organization and the
project team.
• Departments (e.g., purchasing, legal, or contracting) ensure that the contract
addresses all requirements, risks, and regulations. The contracting officer works
with the project manager to obtain external goods and services. The
contracting officer has the authority to enter into legally binding contracts and
make contract modifications.
• Organizations can have two major approaches:
• Centralized purchasing: specific department that handles all procurement activities
• Decentralized purchasing: delegate procurements to the project manager
159
Project Procurement Management Emerging Trends and Practices
New technology tools have increased
procurement efficiencies. For
Organizations hire contractors under a example, online portals that link
trial engagement to gauge whether buyers and vendors help to
the contractor has the ability to standardize and streamline the
successfully provide the desired Technology tools acquisition, delivery, and closure of
products and services (online portals) contracts
Trial
engagements Risk
Emerging trends management
(contractors)
Increased procurement accountability and
More refined approaches to
transparency to stakeholders. For example,
Accountability defining and allocating risks
USASpending.gov provides general public
and between buyers and
with information related to amount of
transparency vendors
money that agencies have spent on
initiatives and the organizations that have
provided those products and services 160
Plan Procurement Management: Key Outputs
Procurement Procurement
Change requests
mgt. plan strategy
Plan
Independent
Procurement Bid documents
cost estimates
Mgt.
Make or buy Source selection Procurement

decision criteria SOW
161
Fixed‐Price Contract Payment Type
Firm‐Fixed Price
(FFP; lump sum)
Fixed Price
Purchase order Fixed Price Types Incentive Fee
(FPIF)
Fixed Price
Economic Price
Adjustment
(FPEPA)
162
Fixed‐Price Contract Payment Type
• Firm‐Fixed‐price (lump sum): a set price for well‐known deliverables with few expected changes.
• Fixed‐Price Incentive Fee: a fixed‐price contract that provides a financial incentive for one or
more criteria. For example, a vendor performing road maintenance for a fixed price might earn
an additional $2,000 for every day they finish ahead of schedule.
• Fixed‐Price Economic Price Adjustment (FP‐EPA): generally used for well‐defined, lengthier
projects. This type of contract payment permits price fluctuations for items like wages or
commodities. Typically, these contracts fix quantities, such as number of labor hours or the
number of components or the volume of materials purchased, but the price per item charged
fluctuates using an agreed‐upon index (e.g., a steel index).
• Purchase order: a unilateral (signed by the buyer only) contract, typically for commodities. The
definition of purchase order can vary greatly by organization. However, it’s somewhat common
for an organization to enter into a contract with a vendor for a specific commodity for a
certain time period at a specific fixed price per item (e.g., $30.00 for 10 reams of a specific type
of paper). When the organization needs to acquire additional quantities, the organization
creates (and potentially signs) a purchase order, and routes it to the vendor for fulfillment.
163
Cost‐Plus Contract Payment Type
Cost
Cost Plus Award Cost Sharing
Fee
Cost plus types
Cost Plus Cost Plus
Incentive Fee Percentage of
(CPIF) Cost (CPPC)
Cost Plus Fixed
Fee (CPFF)
164
Cost‐Plus Contract Payment Type
• Cost Contract (Garrett, 1997): the organization pays the vendor’s actual costs with no profit.
Government partnering with universities can use this type of contract.
• Cost‐Sharing Contract (Garrett, 1997): the organization pays only a portion of the vendor’s cost
with no profit. If the vendor benefits from the development of a product or service (e.g., it can be
sold to other customers), the vendor might be willing to absorb some of the development costs.
• Cost‐Plus‐Percentage‐of‐Cost (CPPC) contract (Garrett, 1997): the vendor up charges a specific
percentage of the actual costs as profit. This type of contract poses great risk to the buyer, as
unethical vendors have an incentive to prolong projects and acquire the most expensive resources.
• Cost Plus Fixed Fee (CPFF): the vendor receives a fixed monetary (e.g., dollars) amount of profit,
regardless of actual project costs. For example, a software development vendor may charge the
client $20,000 as a fixed fee (unchanging profit). If actual costs amount to $100,000, the buyer pays
this $100,000, plus the fixed fee of $20,000.
• Cost Plus Incentive Fee (CPIF): the vendor and buyer agree on a high‐level cost target for the
project work, and then agree to share the cost savings or the cost overruns. For example, they
agree to share any savings and cost overruns using a 30%/70% (buyer/vendor) ratio.
• Cost Plus Award Fee (CPAF): in addition to actual costs, the buyer pays the vendor a potential
profit (the award fee) based on the buyer’s satisfaction with subjective performance criteria. This
type of contract poses great risk to the vendor.
165
Time and Materials Contract Payment Type
• Often used for staff acquisition, hiring experts, and where
precise work is unknown
• Therefore the vendor charges for all costs like labor and materials
using predetermined prices.
• Time and materials payment type contains elements of
• Fixed‐price payment: labor rates, materials, and other factors use set
prices (unchanging unit prices)
• Cost‐reimbursable payment: both the work and the final costs are
open ended
• Time and materials places a burden on the organization to
ensure that assigned human resources have both sufficient
work and supervision.
166
Plan Procurement Management: Key Outputs
(Reminder)
Procurement Procurement
Change requests
mgt. plan strategy
Plan
Independent
Procurement Bid documents
cost estimates
Mgt.
Make or buy Source selection Procurement

decision criteria SOW
167
Make or Buy Calculation
(x = daily cost)
Buy (an asset) Lease (an asset)
$1,000,000 + $1,000X $5,000X
‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐
$1,000,000 + $1000(4) $5,000(4)
‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐ ‐‐‐‐‐‐‐‐‐‐‐‐‐ 4 days actual cost comparison
$1,004,000 $20,000
‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐
$1,000,000/$5000‐$1000 = 250 days
(Break Even Point, taking into account the $1,000 daily maintenance fee)
168
Source Selection Analysis
• Provides prospective vendors with a description of how the organization will choose the vendor:
oLeast cost: the lowest cost, technically acceptable vendor is generally offered the work.
oQualifications only: the organization shortlists a small number of potential vendors and offers the work to the
vendor who possesses the best qualifications, experience, references, or similar criteria.
oQuality‐based/highest technical proposal score: the vendor with the best technical proposal. Provided the buyer
and vendor can negotiate an agreeable price, the organization offers the work to this vendor.
oQuality and cost‐based: the organization considers the quality, cost, and potentially other factors of the vendors
submitting proposals, and offers the work to the vendor who provides the most applicable solution. The
organization can use weighting and screening criteria to determine the most suitable vendor.
oSole source: where only one vendor could possibly provide the product or service, such as when a vendor holds
a patent or highly specialized knowledge. In these cases, the vendor holds considerable leverage over the buyer.
oSingle source: the buyer chooses a particular vendor to provide standard products and services, generally for a
fixed time period through a master contract. These can provide benefits to the organization (e.g., lower prices,
faster acquisition of products and services, consistent quality) and to the vendor (consistent work and revenue
with reduced procurement‐related work.)
oFixed budget: the organization specifies the maximum amount of money available and describes the desired
scope. Vendors provide responses on the quantities of products and services they can provide within the cost
constraint. 169
Plan Procurement Management: Key Inputs
Business Project
Project mgt.
documents
charter plan
Other
project
documents
Procurement Mgt. Plan
Procurement Strategy
Other outputs
170
Plan Procurement Management: Key Tools
and Techniques
Expert judgment Procurement mgt.
Project charter
Data gathering plan
Business Procurement
documents (Market Research) strategy
Project mgt. plan Data analysis Bid documents
Procurement SOW
Project Source selection analysis Other outputs
documents
Meetings
Project Management Institute, A Guide to the Project Management Body of Knowledge, (PMBOK® Guide)
‐ Sixth Edition, Project Management Institute, Inc., 2017, page 466.
171
Plan Stakeholder Engagement Process
• Part of the Project Stakeholder Management Knowledge Area, which includes the
processes that help to identify the individuals, groups, and organizations affected by
the project; determine their requirements, and determine how to engage them
throughout the project to ensure their support.
• This second process in this knowledge area, Plan Stakeholder Engagement involves the
creation of a stakeholder engagement plan that describes the activities that will be
performed to keep stakeholders involved, interested, and supportive of the project. This
document also describes how the project management team will perform all other
processes in the Project Stakeholder Management Knowledge Area, including:

Manage Stakeholder Monitor Stakeholder
Engagement (13.3) Engagement (13.4)
172
Plan Stakeholder Engagement: Key Concepts
Current and desired
Process for engagement levels
Planned strategies
updating the plan
Stakeholder
engagement plan
Expected project
impact on Stakeholder
stakeholders interrelationships
(and their reactions)
173
Plan Stakeholder Engagement: Key Inputs,
Tools and Techniques, Outputs
Expert judgment
Project charter Data gathering
Data analysis Stakeholder
Project mgt. plan
Decision making engagement
Project plan
Data representation
documents
(Stakeholder Engagement Assessment Matrix)
Meetings
174
Stakeholder Engagement Assessment Matrix
Stakeholder Unaware Resistant Neutral Supportive Leading
Sponsor D, C
Customer C D
Functional C D
Manager 1
D= Desired level of engagement
C = Current level of engagement
175
Change Management Plan and Configuration Management Plan
(Additional Components to Project Management Plan)
(PMBOK® Guide 4.2.3.1)
• **Change management plan
• Specifies the process for evaluating and potentially incorporating project
changes that affect one or more of the project’s baselines
• Helps minimize scope creep, gold plating, late delivery, and cost overruns
• **And yet, NOT a process in the PMBOK process groups and knowledge areas
• **Configuration management plan
• Describes the project products, product documentation, and what product
information will be identified, recorded, verified, and audited.
• Benefits: identifying recalled components, documenting methods to quickly
resolve incidents, identifying maintenance schedules, etc.
• Works hand‐in‐hand with project change management systems: requested
changes often affect and create configuration items
• **And yet, NOT a process in the PMBOK process groups and knowledge areas
176
Lesson 5: Planning Processes, Section A Review –
Management Plans
• PMP®/CAPM® Test‐Worthy Topics: • Plan Resource Management (9.1)
Lesson 5, Section A – Management • Plan Communications Management
Plans (10.1)
• Planning Process Group Overview • Plan Risk Management (11.1)
• Develop Project Management Plan • Plan Procurement Management
(4.2) (12.1)
• Subsidiary Management Plans • Plan Stakeholder Engagement (13.2)
• Plan Scope Management (5.1) • Change Management Plan and
• Plan Schedule Management (6.1) Configuration Management Plan (4.2)
• Plan Cost Management (7.1) • PMP®/CAPM® Practice Questions
• Plan Quality Management (8.1) • What are your questions?
177
PMP®/CAPM® Practice Questions: Planning
Processes, Section A
the entry Lesson 5: Planning Processes Section A:
Management Plans Questions.
• Answer the odd‐numbered questions and check your
178
Section B – Scope, Schedule,
Resource, and Cost Processes
Learning Objective: Based on the planning processes described in the
PMBOK® Guide Sixth Edition, Planning processes.
179
179
Lesson 5: Planning Processes, Section B Topics – Scope,
Schedule, Resource, and Cost Processes
• PMP®/CAPM® Test‐Worthy Topics: • Resource Planning Processes
Lesson 5, Section B: Scope, Overview
Schedule, and Cost Processes • Define Activities (6.2)
• Scope, Schedule, Resource, and • Sequence Activities (6.3)
Cost Processes Overview
• Scope Planning Processes • Estimate Activity Resources (9.2)
Overview • Estimate Activity Durations (6.4)
• Collect Requirements (5.2) • Develop Schedule (6.5)
• Define Scope (5.3) • Cost Planning Processes Overview
• Create WBS (5.4) • Estimate Costs (7.2)
• Schedule Planning Processes • Determine Budget (7.3)
Overview • PMP®/CAPM® Practice Questions
180
Scope, Schedule, Resource, and Cost Planning
Processes Overview
• This section of the course describes in detail all the remaining
planning processes for the Project Scope, Schedule, Resource,
and Cost Knowledge Areas processes.
• Some project management books describe scope, schedule, and
cost as the “triple constraints.”
• It’s a long‐running truism (and perhaps somewhat of a joke) that if the
customer locks down the scope, schedule, and cost without input from
the project management team, the project manager can respond,
“Good, fast, or cheap. Pick two!”
• Resource types, quantities, and experience/grade directly affect
schedule and cost.
181
Scope Planning Processes Overview
• Plan Scope Management (discussed earlier in this course)
• Collect Requirements (Planning Process Group; PMBOK® Guide 5.2):
determining, documenting, and managing stakeholder needs and
requirements to meet project objectives.
• Define Scope (Planning Process Group; PMBOK® Guide 5.3):
developing a project scope statement that provides a detailed
description of the project work and product, and which also specifies
the work and deliverables excluded from the project.
• Create WBS (Planning Process Group; PMBOK® Guide 5.4): subdividing
project deliverables and project work into smaller, more manageable
components and finalizing the scope baseline
182
Collect Requirements (PMBOK® Guide 5.2)
• Requirements: measurable, testable, and complete conditions or
capabilities of a product, service, or result that address the needs
and expectations of stakeholders
• Examples:
• The project will generate a minimum return on investment of 10%.
• The system will achieve a throughput of at least 50 items per hour.
• The system’s planned downtime for maintenance will not exceed 20 minutes per day.
• Requirements drive the solution (deliverables and work), which
drives the project’s schedule, cost, quality, risk, and other factors.
183
Collect Requirements: Key Outputs
Business Requirements Traceability
revenue, cost
Matrix
savings
Description
Quality
Stakeholder
testing, certification Rationale
Requirements Project objective
Documentation
Project Solution Deliverables
milestone dates, functional requirements
contractual (product behavior) Design &
obligations and non‐functional development
(reliability, security)
Transition and
readiness Test plan
training
184
Collect Requirements: Key Inputs
Project Project
Project
charter mgt. plan
documents
Business
docs
Agreements
Requirements documentation
Requirements Traceability Matrix
185
Collect Requirement: Key Tools and
Techniques
Expert judgment
Data gathering
Data analysis
Project charter
Decision making Requirements
Project mgt. plan documentation
(Unanimity, Majority etc.)
Project documents
Data representation Requirements
Business documents
Agreements
Interpersonal and team skills Traceability Matrix
(Nominal Group Technique)
Context diagrams
Prototypes
Edition, Project Management Institute, Inc., 2017, page 138. 186
Decision Making Techniques
• Unanimity: all parties support the requirement
• Majority: over 50% support the requirement
• Plurality: largest block of votes even if less than 50%; used
when more than two options available
• Autocratic: one party with authority decides
187
Nominal Group Technique
• Structured form of brainstorming:
• Anonymous generation of ideas
• A moderator‐led discussion of these ideas
• Voting on these ideas
188
Define Scope Process
(PMBOK® Guide 5.3)
• Producing a project scope statement that further defines the work and
deliverables of the project described in the approved project charter
• Ensuring the design will meet the requirements defined in the requirements
documentation and requirements traceability matrix
• Determining exclusions: work or deliverables not included in the project to
help manage stakeholder expectations and reduce the likelihood of scope
creep (unmanaged scope changes)
• For predictive plan‐driven projects, scope defined and refined many times
during planning, but generally locked down at the conclusion of planning
• For agile projects, prioritized deliverables (features; characteristics)
determined and potentially revised at the beginning of each sprint (iteration)
189
Define Scope: Key Concepts
Product scope Requirements
description documentation
Project
Project Stakeholder Document Traceability
Scope Deliverables
exclusions register updates matrix
Statement
Acceptance Assumptions
criteria log
190
Define Scope: Key Inputs, Tools and
Techniques, Outputs
Expert judgment
Project charter Data analysis Project scope
statement
Project mgt. plan Decision making
Project document
Project documents Interpersonal and team skills updates
Product analysis*
**Examples of product analysis beyond the scope of this course include: product
breakdown, requirements analysis, systems analysis, systems engineering, value
analysis, value engineering, and instructional systems design.
Project Management Institute, Inc., 2017, page 150. 191
Create WBS Process
(PMBOK® Guide 5.4)
• Work Breakdown Structure (WBS)
• Decomposing the deliverables and work in the project scope statement
into smaller, manageable work packages
• Provides the foundation for all other project aspects like schedule,
cost, quality, and resources
• The WBS becomes part of the scope baseline: a key component of the
project management plan, and a key input for every process in the
Planning, Executing, Monitoring and Controlling, and Closing Process
Groups.
• Each work package represents a group of activities that will be further
decomposed in the Project Schedule Management Process called
Define Activities.
192
Work Packages, Activities and Control
Accounts
• *The lowest level of WBS lists the work packages, not the
activities themselves. The team decomposes work packages into
activities later in planning in the process called “Define
Activities”.
• Work packages should be detailed “enough” to enable the team
to generate a list of activities later in planning.
• When creating a WBS, the team must consider at what level of
detail that key stakeholders, such as the sponsor, finance, or
accounting, will require scope, schedule, and cost reporting.
• Control accounts in the WBS represent the elements where the team
will report performance. Generally, one control account represents two
or more work packages.
193
WBS Example – Organized by Phase
Project Name (0)
Phase (1) Phase (2)
Deliverable 4
Deliverable (1.1) Deliverable (1.2) Deliverable (2.1)
(2.2)
Design Work Work package Work package Work package

Package(1.1.1) (1.2.1) (2.1.1) (2.2.1)
Prototype Specs
Work package Work package Work package
Work
(1.2.2) (2.1.2) (2.2.2)
Package(1.1.2)
Note: the numbers in parentheses represent the WBS number
194
WBS Example – Organized by Deliverable
Project Name
(0)
Deliverable Deliverable
(1) (2)
Component Component 2
Feature (2.1) Feature (2.2)
(1.1) (1.2)
Work package Work package Work package Work package

(1.1.1) (1.2.1) (2.1.1) (2.2.1)
Work package Work package Work package Work package

(1.1.2) (1.2.2) (2.1.2) (2.2.2)
Note: the number in parentheses represent the WBS number
195
Create WBS: Key Output
Describing a wide
variety of very
detailed information Project scope
for each element of statement
the WBS, such as
deliverable or work
descriptions, along
with schedule, cost,
quality, resource, and
agreements. Scope baseline
WBS dictionary WBS
196
Create WBS: Key Inputs, Tools and
Techniques, Outputs
Project mgt. plan Scope baseline
Decomposition Project document
Project documents updates
197
Schedule Planning Processes Overview
• Plan Schedule Management (Planning Process Group; PMBOK® Guide 6.1; discussed earlier in
this course)
• Define Activities (Planning Process Group; PMBOK® Guide 6.2): determining, and
documenting specific activities needed to be performed to meet project objectives and
produce deliverables.
• Sequence Activities (Planning Process Group; PMBOK® Guide 6.3): determining, and
documenting the order in which activities will be performed and the relationship between
them.
• Estimate Activity Durations (Planning Process Group; PMBOK® Guide 6.4): estimating the
amount of time needed to complete each activity with the estimated available resources.
• Develop Schedule (Planning Process Group; PMBOK® Guide 6.5): analyzing schedule
parameters like the sequence of activities, their durations and resource requirements, and
associated constraints in order to derive an optimum schedule to carry out project work.
198
Define Activities Process(PMBOK® Guide 6.2)
• Identifying and listing the actions to produce the project
deliverables to meet the project objectives
• Identifying milestones (significant events with 0 duration)
• Activities represent the work effort required to complete
the work package, and they provide a basis for scheduling,
cost estimating, monitoring and controlling.
199
Define Activities: Key Outputs Activity attributes
describe detailed
parameters of each
activity, such as
duration, cost,
resources, required
skill sets, schedule
Project Activity list time and date(s),
management plan Activity attributes tracking IDs, and
updates other information. It
requires information
typically not available
at the beginning of a
project, thus the
Define Activities team progressively
elaborates these
details as the project
progresses.
Change requests Milestone list
200
Define Activities: Key Inputs, Tools, and
Techniques
Expert judgment
Project Activity list
Decomposition
management Activity attributes
plan Rolling wave planning
Milestone list
Meetings
201
Sequence Activities Process
(PMBOK® Guide 6.3)
• Activities are ordered to be performed in sequence or parallel.
• Every activity, except the starting and finishing activities, has at
least one activity performed before it (predecessor) and after it
(successor).
• The schedule network diagram visually displays the resulting
sequence.
• Coupled with activity durations, activity resources, and other
factors, the network diagram leads to the creation of the
project schedule (during the process Develop Schedule,
discussed in detail later in the course).
202
Sequence Activities: Key Inputs, Tools, and
Techniques
Precedence diagramming
method (PDM)
Dependency determination Project schedule
Project mgt. plan network diagrams
and integration
Project documents Project documents
Leads and lags updates
Project mgt. information
system
203
Sequence Activities: Key Outputs
Project Schedule Network Diagram
FS+10
B D
Start A F Finish
C E
204
Path Divergence and Convergence
Divergence Convergence
FS+10
B D
Start A F Finish
C E
Project Schedule Network Diagram
205
PDM Relationship Types, Lags and Leads
https://blogs.msdn.microsoft.com/project/2008/07/28/back‐to‐basics‐understanding‐task‐dependencies/
206
Resource Planning Processes Overview
• Plan Resource Management (Planning Process Group;
PMBOK® Guide 9.1; discussed earlier in this course)
• Estimate Activity Resources (Planning Process Group;
PMBOK® Guide 9.2): determining and documenting types
and quantities of specific resources needed – both human
and physical – to perform project work and meet project
objectives
207
Estimate Activity Resources Process
(PMBOK® Guide 9.2)
• Determining the types, quantities, and attributes of human
and physical resources required to perform the project.
• Working in close conjunction with the Project Schedule
Management and the Project Cost Management processes
• Estimate Activity Resources is heavily integrated with the
previous process, Plan Resource Management process.
Particularly, elements such as activity resource
requirements, RACI charts, and project organizational
charts.
208
Estimate Activity Resources: Key Outputs
Basis of Estimates:
describes how the resource
Resource requirements were
requirements derived. This document
may include the method
used to develop the
estimate, the range for the
Project Basis of estimate if required, an
Estimate Activity
documents estimates indication of the level of
Resources
updates confidence in the
estimates, and additional
factors that were
Resource considered while
breakdown estimating including the
structure constraints, risks, and
assumptions.
209
Estimate Activity Resources: Key Inputs, Tools,
and Techniques
Expert judgment
Analogous estimating Resource
Parametric estimating requirements
Project management Basis of estimates
plan Bottom‐up estimating
Resource breakdown
Project documents Data analysis structure
Project management Project documents
information system updates
Meetings
210
Estimating
• Analogous estimating:
• With limited information, the project team may use the quick and
inexpensive approach of using resource estimates from similar past projects.
• Parametric estimating:
• Making use of formulas and algorithms to compute the estimate. For
example, a requirement to produce 6,000 parts per hour would require two
machines that each produces 3,000 parts per hour. Like all estimates, the
accuracy of a parametric estimate depends on the quality of the data and the
robustness of the estimating model used.
• Bottom‐up estimating
• Used when the work is too large to be estimated with a reasonable degree
of confidence. In such cases, the team divides the work into smaller
components (e.g., activities) that could be estimated for resources with a fair
degree of confidence. These estimates are then aggregated to the work
package level, control account level, and the project level.
211
Estimate Activity Durations Process
(PMBOK® Guide 6.4)
• Activity durations are estimated by people who specialize / are
knowledgeable in the activity to be estimated.
• Depends on the availability of resources and skills and other
factors, including:
Number of resources Motivation of staff
Increasing resources may or may not reduce the time to Parkinson’s Law: work expands to fill time available for
complete the activity; must also consider learning curve, its completion. Additionally, procrastination must be
knowledge transfers, and increase in administration and considered by estimating durations.
risk.
Law of diminishing returns Advances in technology
As activity resources are increased, a point will arrive Use of latest technology, which may be more efficient and
when adding additional resources results in diminishing have a higher throughput, could potentially impact
increases in productivity. resource needs and subsequently the duration.
212
Estimate Activity Durations: Key Outputs
Duration
estimates
Estimate Activity
Durations
Basis of
estimates
213
Estimate Activity Durations: Key Inputs
Schedule Lessons Activity Risk register Resource

Scope management learned list
baseline plan register Resource calendars
Project team Milestone breakdown
Resource structure
assignments list requirements
Assumption
log Activity
attributes
Duration estimates
Basis of estimates
214
Estimate Activity Durations: Key Tools and
Techniques
Expert judgment
Analogous estimating
Parametric estimating
Duration
Project mgt. plan Three‐point estimating estimates
Project documents Bottom‐up estimating Basis of
estimates
Data analysis
Decision making
Meetings
215
Three‐Point Estimating
• Three Point Estimate (tE) Involves the range of three estimates (best,
worst and most likely scenarios) to accomplish an activity, phase or the
entire project. Three‐point estimating incorporates varying degrees of
uncertainty to arrive at a single, final estimate.
• Most likely (tM) estimate is based on the scenario that makes realistic
assumptions of resource availability, productivity, dependencies on
influencing factors and constraints.
• Optimistic (tO) estimate is based on assumptions of a best‐case scenario
• Pessimistic (tP) estimate is based on assumptions of a worst‐case scenario
• Triangular distribution formula is used to compute the expected
duration:
(tE) is tE = (tO + tM + tP) / 3 (6 + 8 + 13) / 3 = 9
216
Develop Schedule Process
(PMBOK® Guide 6.5)
• Incorporating outputs of many other processes to create the
project schedule and the finalized schedule baseline
• The project schedule:
• Can change daily during the Executing Process Group as reality unfolds
• Used to manage the actual work
• The schedule baseline
• Key component of the project management plan
• Cannot change without an approved change request
• Compared against the actual project schedule during the Monitoring
and Controlling Process Group to determine schedule variances
217
Develop Schedule: Key Outputs
Schedule baseline
Project
documents Project schedule
updates
Develop Schedule Schedule data
Project
management plan • alternative
schedules, schedule
updates reserves
Change requests Project calendars
218
Develop Schedule: Key Inputs
Schedule Lessons Activity

learned Risk register
Scope management plan list Resource
baseline register Project schedule calendars
Milestone list Activity network diagrams
attributes Resource
Project team
assignments Duration requirements
Assumption estimates Basis of
log estimates
Agreements
Schedule baseline
Project schedule
Schedule data
Project calendars
219
Develop Schedule: Key Tools and Techniques
Schedule network analysis
Critical path method Schedule
Project mgt. plan Leads and lags baseline
Project Resource optimization Project schedule
documents Data analysis Schedule data
Agreements Schedule compression Project calendars
Project management Change requests
information system
220
Determine Critical Path
Activity A (on critical path)
5 Days
Activity B (on critical path)
Start Finish
5 Days
Activity C (not on critical path)
7 Days 3 days of total slack
221
Exercise: Create a Network Diagram to
Activity/Milestone Duration Predecessors
Start 0 N/A
A 5 Start
B 5 A
C 10 A
D 15 B,C
Finish 0 D
222
Answer: Create a Network Diagram to
223
Critical Path Analysis Sixth Edition, Project Management Institute, Inc., 2017, page 210. (6.5.2.2)
Analyze a Network
Diagram
1. How many paths run through
the network diagram?
Calculate the durations for all
paths (assuming duration in
days).
2. What is the critical path?
3. How long is the critical path?
4. If any activities are not on the
critical path, how many days
could they be delayed before
they would become critical as
well?
• Time to complete this
exercise: 5 minutes
224
Exercise Answers: Create a Network Diagram
to Determine Critical Path
1. How many paths run through the network diagram? Two:
ABD (25 days) and ACD (30 days)
2. What is the critical path? ACD
3. How long is the critical path? 30 days
4. If any activities are not on the critical path, how many days
could they be delayed before they would become critical as
well? B is not on the critical path. It could be delayed by
five days (or take five days longer than expected) before it
would become critical.
225
Additional Critical Path Exercises
• Note: there are additional critical path exercises, included
in the appendices of this manual.
• They are likely harder than the ones you will see on the
exam, as they entail more activities. However, answering
these questions correctly will give you confidence if (or
when) you see these types of questions on the exam.
226
Resource Optimization
• Adjust the project schedule to reflect real‐world resource
limitations. Optimizing resources for these limitations can
involve two similar methods:
• Resource leveling
• "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.“ (PMBOK Definition)
• Resource smoothing
• Provides the same leveling goal described above, though it
prohibits delaying the schedule end date. Thus, it only levels over‐
allocated and under‐allocated resources on non‐critical activities.
227
Schedule Compression
• Techniques that reduce the duration of activities on the critical
path while not changing the desired scope or quality of those
activities. Specific schedule compression techniques include:
• Crashing
• increasing the quality or quantity of activity resources (e.g., hiring or
assigning more human or physical resources, selecting more experienced
resources or faster machines). Crashing generally increases the cost and
the risk of the project: higher quality resources generally cost more
money, and managing more resources involves higher risk.
• Fast tracking
• performing multiple critical activities simultaneously as opposed to
sequentially. Though fast tracking generally shortens the schedule, it
increases risk and rework.
228
Cost Planning Processes Overview
• Plan Cost Management (Planning Process Group; PMBOK® Guide
7.1; discussed earlier in this course)
• Estimate Costs (Planning Process Group; PMBOK® Guide 7.2):
estimating the financial resources required to complete project
work with the available resources.
• Determine Budget (Planning Process Group; PMBOK® Guide 7.3):
consolidating the estimated costs to perform project work and
creating an understanding of how funds will be expended over
the course of the project.
229
Estimate Costs Process
(PMBOK® Guide 7.2)
• Estimates the monetary resources required to accomplish
each activity and project work in general.
• Includes cost considerations such as the potential costs of
outsourcing resources, financing, inflation, and currency
fluctuations
• Cost estimates are generally provided with ranges or
margins of error
• Rough Order of Magnitude (ROM) range (‐25% to +75%)
• Definitive range (‐5% to +10%)
230
Estimate Costs: Key Outputs
Cost
estimates
Estimate
Costs
Project
Basis of
documents
estimates
updates
231
Direct vs. Indirect Costs
• Direct Cost:
• Labor
• Materials, equipment, services, and facilities
• Information technology
• Cost of financing (including interest charges)
• Inflation allowances, exchange rates
• Contingency reserves
• Indirect Cost:
• Administration
• Marketing
• Many overhead costs
232
Estimate Costs: Key Inputs
Quality Cost
Scope management management Risk
baseline plan plan register
Lessons
learned Resources
register requirements
Project
schedule
Cost estimates
Basis of estimates
233
Estimate Costs: Key Tools and Techniques
Expert judgment
Analogous estimating
Parametric estimating
Cost estimates
Project management plan Bottom‐up estimating
Basis of estimates
Project documents Three‐point estimating
Project documents
Data analysis updates
Project management
information system
Decision making
234
Determine Budget Process (PMBOK® Guide 7.3)
• The project budget, in addition to being an aggregation of cost
estimates, also establishes the points in time when these costs
would come to bear (funding requirements).
• Funding requirements:
• When the project will require funds to pay for project expenditures,
typically either at designated dates (or perhaps milestones).
• When the project will disburse funds, like human resources paying
employees and outside organizations receiving payment for physical
resources upon transfer.
• Not having adequate funds to pay for resources can lead to significant
problems such as low morale and delays.
• It establishes the quantum of expenditure expected to be incurred
in carrying out project work and producing deliverables.
235
Determine Budget: Project Budget
Components
236
Determine Budget: Key Outputs
Cost Remember: Cost baselines
baseline include contingency reserves,
NOT management reserves!
Determine
Budget
Project Project
documents funding
updates requirements
237
Determine Budget: Key Inputs, Tools and
Techniques, Outputs
Expert judgment
Cost aggregation
Project management
Data analysis Cost baseline
plan
Historical information review Project funding
Project documents requirements
Funding limit reconciliation
Business documents (Work may have to be rescheduled in order to align
Project documents
expenses with funding limits) updates
Agreements
Financing
(May include debt, equity, internal/external sources)
238
Lesson 5: Planning Processes, Section B Review – Scope,
Schedule, Resource, and Cost Processes
• PMP®/CAPM® Test‐Worthy Topics: Lesson • Sequence Activities (6.3)
5, Section B: Scope, Schedule, Resource, • Estimate Activity Resources (9.2)
and Cost Processes
• Scope, Schedule, Resource, and Cost • Estimate Activity Durations (6.4)
Processes Overview • Develop Schedule (6.5)
• Scope Planning Processes Overview • Cost Planning Processes Overview
• Collect Requirements (5.2) • Estimate Costs (7.2)
• Define Scope (5.3) • Determine Budget (7.3)
• Create WBS (5.4) • PMP®/CAPM® Practice Questions
• Schedule Planning Processes Overview • What are your questions?
• Resource Planning Processes Overview
• Define Activities (6.2)
239
Processes, Section B
the entry Lesson 5: Planning Processes Section B: Scope,
Schedule, Resource, and Cost Questions.
• Time to complete this exercise: 10 minutes
240
Section C – Risk Processes
Learning Objective: Based on the planning processes described in the
PMBOK® Guide Sixth Edition, Planning processes.
241
241
Lesson 5: Planning Processes, Section C Topics – Risk
Processes
• PMP®/CAPM® Test‐Worthy Topics: Lesson 5: Planning
Processes Section C: Risk Processes
• Risk Planning Processes Overview
• Identify Risks (11.2)
• Perform Qualitative Risk Analysis (11.3)
• Perform Quantitative Risk Analysis (11.4)
• Plan Risk Responses (11.5)
242
Risk Planning Processes Overview
• Plan Risk Management (Planning Process Group; PMBOK® Guide 11.1;
discussed earlier)
• Identify Risks (Planning Process Group; PMBOK® Guide 11.2):
determining, and documenting risks to project objectives.
• Perform Qualitative Risk Analysis (Planning Process Group; PMBOK®
Guide 11.3): assessing the probability and impact of identified risks and
then prioritizing them.
• Perform Quantitative Risk Analysis (Planning Process Group; PMBOK®
Guide 11.4): assessing the impact of all risks on overall project
objectives.
• Plan Risk Responses (Planning Process Group; PMBOK® Guide 11.5):
determining action plans to deal with risks.
243
Identify Risks Process (PMBOK® Guide 11.2)
• The team and all relevant stakeholders identify the
uncertainties (risks) that can threaten or benefit the project
constraints and objectives.
• Risks may impact the project scope, schedule, budget,
quality, resources, and procurements, among other factors.
• Identifying these uncertainties, and subsequently analyzing
and responding to those uncertainties, leads to a much
more predictable project with a greater likelihood of
success.
244
Identify Risks: Key Outputs
Risk Risk Report depicts
register summary information about
the overall project
exposure.
At the conclusion of the
Identify project, the risk report
Risks provides a coherent
document that helps
Project stakeholders understand
documents Risk report how effectively risks were
updates managed on the project,
which can guide future
actions.
245
Risk Register
• Project risks identified by the project team and relevant stakeholders.
• Description of each identified risk
• Each risk’s causes or triggers (events or conditions that indicate that a
risk is about to occur)
• Risk category/categories (e.g., technical risk, resource risk, business risk,
scope risk, schedule risk, safety risk)
• Risk’s current status
• Effects it may have on project objectives and specific WBS elements.
• Potential risk owners
• Risk timing information (e.g., when the risk might occur, when a
response must be implemented if the risk occurs).
246
Identify Risks: Key Inputs, Tools, and
Techniques
Project Expert judgment
management plan
Data gathering
Risk register
Project
Data analysis Risk report
documents
Interpersonal and team skills Project documents
Agreements updates
Prompt lists
Procurement
documentation Meetings
247
Prompt Lists
• Prompt lists that provide the team with lists or frameworks of
pre‐determined categories of risks or impact areas that could
be used to identify specific project risks. Common frameworks
to determine overall project risks include:
• PESTLE (Political‐Economic‐Social‐Technological‐Legal‐Environmental)
• VUCA (Volatility‐Uncertainty‐Complexity‐Ambiguity)
• TECOP (Technical‐Environmental‐Commercial‐Operational‐Political)
248
Perform Qualitative Risk Analysis Process
• The project team and relevant stakeholders assess all risks in
the risk register to determine their probabilities of
occurrence and their impact on project objectives.
• Determining the probabilities and impacts of risks requires
soliciting people’s opinions, which can introduce biases.
Hence, it’s a subjective (qualitative) method.
• The probabilities and impact values may be combined with
other assessment factors, to derive a cumulative risk score.
249
Perform Qualitative Risk Analysis: Key Output
Risk Register
A log used to document and track
issues
Project
Issues log document Risk Report
updates
Assumptions A document used to record all
log assumptions and constraints throughout
the project life cycle
250
Perform Qualitative Risk Analysis: Key Inputs,
Tools, and Techniques
Expert judgment
Data gathering
Project management Data analysis
plan Project documents
Interpersonal and team skills updates
Project documents
Risk categorization
Data representation
Meetings
251
Probability and Impact Matrix; Probability and
Impact Chart
Probability and Impact Matrix Probability and Impact Chart
Risk Probability Impact Rating
(1‐5) (1‐5) (P X I) High
Risk 1
Risk 2
Probability
Low
**The result of Qualitative Risk Analysis Low Impact High
end up in the Risk Register that lists all
risks. 252
Updated Risk Register
Risk Prob. Impact Risk Rating Risk Response Risk Owner
1 (low)‐5 (high) 1 (low)‐5 (high) (P X I) Strategy
Sponsor leaving 3 4 12 Include likely Project Manager
company new sponsor in
communications
Not enough 2 3 6 Dedicated Project Manager

people resource, hire
contractors
253
Perform Quantitative Risk Analysis Process
• A quantitative analysis of risks numerically assesses risks to
determine their cumulative impact on project objectives. A
quantitative analysis of risks provides a more definitive way to
determine the actual impact of project risks.
• Involves the assessment of overall project risks on the project.
• Generally makes use of a computer simulation analyses to
determine the effect of risks on project outcomes.
• May not be required to be performed on projects that are small
or easier to execute or of lower significance.
254
Perform Quantitative Risk Analysis: Key
Outputs
Perform
Project documents
Quantitative Risk
updates
Analysis
255
Perform Quantitative Risk Analysis: Key
Inputs, Tools, and Techniques
Expert judgment
Data gathering
Project Interpersonal and team skills
management plan Representations of uncertainty Project documents
Project updates
(Probability Distributions,
documents Statistical Correlation)
Data analysis
(Monte Carlo)
256
Tornado Diagrams
• Rank risk variables that affect schedule, cost, or quality, helping
the project manager focus on the variables that potentially
impact the project.
• Frequently use optimistic, most likely, and pessimistic scenarios.
• Use variables in isolation; keep all other factors at their most
likely value and then create bars based on best case and worst
case.
• Provide the foundation for further research to verify
assumptions and to investigate risk response strategies.
257
Tornado Diagram: Effect of Risks on Schedule in Days
70 75 80 85 90 95 100 105 110 115
Labor availability
Weather
Optimistic
Labor experience Pessimistic
Working hours/day
Job site conditions
https://www.youtube.com/watch?v=grPcreRG‐lY
258
Influence Diagrams
• Provide a graphic of a system with causal influences, time
ordering of events, and relationships between variables.
• Can provide a depiction of project risks and potential risk
response strategies.
• With quantitative information, can provide the foundation
for decision trees.
259
Example: Influence Diagram
Vendor Shipping
Distance + Travel time ‐ Expediting Fees
+
Probability of
Arrival at
on‐time
Job Site
delivery
+
Vendor Manufacturing Manufacturing
Capacity
‐ time ‐ Expediting Fees
260
Expected Monetary Value (EMV) Analysis
• Calculates the average outcome for future events that may
or may not happen.
• The probability of an event times the “quantified output.”
For example, assume a project has a threat with a 10%
chance of causing a $1,000 loss.
• $1,000*0.1=$100
• The expected monetary value of this risk is $100. This $100
could be set aside as contingency reserves, along with
reserves of all other threats.
261
Exercise: Expected Monetary Value
• Calculate the Expected Monetary Value for the activities on this
project. What is the total EMV of this project?
• 20% of past projects have suffered from poorly‐defined requirements, which
adds an average, additional cost of $2,000 per project.
• 25% of past projects have been able to secure highly‐skilled resources,
which reduces the cost of the average project by $500.
• 40% of past projects have suffered from fluctuating customs fees, which add
an average, additional cost of $800 per project.
262
Exercise Answers: Expected Monetary Value
Risk Probability Impact Expected
Monetary Value
Poorly‐defined 20% $2,000 $400
requirements
Highly‐skilled 25% ($500) ($125)
resources
Fluctuating 40% $800 $320
customs fees
Total Expected Monetary Value $595
(Contingency Reserves*)
263
Exercise: Decision Trees Using Expected Monetary Value
• Calculate the Expected Monetary Value for each of these
projects.
• Project A
• 80% chance of EARNING $100,000 GAIN = ??
• 20% chance of LOSING $50,000 LOSS = ??
• EMV = ??
• Project B
• 50% chance of EARNING $160,000 GAIN = ??
• 50% chance of LOSING $40,000 LOSS = ??
• EMV =??
• If the organization could only fund one of these projects, which
would it fund?
264
Exercise Answers: Decision Trees Using Expected Monetary Value
• Project A
• 80% chance of EARNING $100,000 GAIN = $80,000
• 20% chance of LOSING $50,000 LOSS = ($10,000)
• EMV = $70,000
• Project B
• 50% chance of EARNING $160,000 GAIN = $80,000
• 50% chance of LOSING $40,000 LOSS = ($20,000)
• EMV = $60,000
Project A is more desirable, as it has a higher EMV
265
Monte Carlo
• Can simulate project schedule, cost, or other constraints
• Often uses optimistic, most likely, and pessimistic estimates
for task as inputs
• Simulates the project by randomly choosing different
numbers for many iterations
• Creates a probability distribution of expected schedule,
cost, etc.
266
Plan Risk Responses (PMBOK® Guide 11.5)
• High priority risks would have responses planned for them.
• Responses may not be planned for those risks that may not
significantly impact the project or aren’t likely to materialize.
These risks are monitored.
• Major risks would be addressed depending on the nature of
the risk – opportunity or threat.
• Project cost, time, and resources would be planned for use,
to implement responses
267
Risk: Risk Response Strategies
• The following strategies are those recommended
by PMI to use in planning risk responses. We
recommend that you memorize each response
type and be able to recognize it in a situation.
• Mnemonic:
• SEE (share, exploit, enhance) Opportunities
• ATM (avoid, transfer, mitigate) Threats
268
Risk: Risk Response Strategies (Cont.)
Risk Response Strategies for Positive Risks or Opportunities
Risk Response Tool Description Example
The share strategy splits the The technology company formed a
responsibility (and benefit) of the risk partnership with a marketing company to
Share
with a third party (or parties) to launch a sales campaign to support the
maximize an opportunity. new product being developed.
The exploit strategy takes steps to The new project had the best resources
Exploit ensure the success and the risk of the assigned to maximize the probability of
event or project. success.
The enhance strategy takes steps to When sales were exceeding projections,
improve the size or capacity of the risk the company hired more sales people to
Enhance event by determining the key ensure that as many customers as
components of the risk and maximizing possible knew of their products.
those components. 269
Risk Response Strategies for Negative Risks or Threats

Avoid involves modifying the plan so Selecting alternative potential vendors will keep
Avoid risk doesn’t have to be dealt with. To you from running out of inventory.
get rid of the problem.
Transfer reassigns risk exposure to Example #1: Hiring an outside company to do
another party. In doing this, you do something instead of doing it yourself (contract
Transfer not necessarily eliminate all risk, but out risk)
likely minimize some and create Example #2: Buying insurance for something
additional risk as well. (contractually underwrite cost of risk)
Mitigate is to proactively change the Eliminating outside sources and doing work

Mitigate plan to minimize the impact or internally mitigates your risk if another company
probability of the risk occurring. failed to meet the deliverables on your project.
270
Risk Response Strategies for both Positive and Negative Risks
Acceptance tolerates the risk and deals with Determining that, if a union goes on
Accept it. It is a valid option if there are no other strike, the project will have to stop until
options available. the strike is settled.
When the project team and/or project While working on a new residential
manager agree that the risk is outside the construction project, the project manager
scope of the project, or that the response catches wind of a neighboring parcel of
Escalate exceeds the project manager’s authority. land, zoned for commercial use only, is
Often escalated to program level or portfolio recently listed for sale. This may be an
level, or other parts of the organization. opportunity, but is outside the scope of
the current project.
271
Plan Risk Responses: Key Outputs
Change
requests
Plan Risk
Responses
Project Project
documents management
updates plan updates
272
Plan Risk Responses: Key Inputs
Risk report Cost Resource
Risk Resource baseline management plan
register
calendars
Stakeholder
register Lessons learned Risk management
register plan
Project
schedule Project team
assignments
Change requests
273
Plan Risk Responses: Key Tools and Techniques
Expert judgment
Data gathering
Strategies for threats
(ATM) Change requests
Project management Strategies for opportunities Project management
plan plan updates
(SEE)
Contingent response strategies
updates
(when risk responses fail to have the
anticipated effect)
Strategies for overall project risk
Data analysis
Decision making
274 Sixth
Lesson 5: Planning Processes, Section C Review – Risk
Processes
• PMP®/CAPM® Test‐Worthy Topics: Lesson 5: Planning Processes
Section C: Risk Processes
• Risk Planning Processes Overview
• Identify Risks (11.2)
• Perform Qualitative Risk Analysis (11.3)
• Perform Quantitative Risk Analysis (11.4)
• Plan Risk Responses (11.5)
275
• Again, this slide may not be accurate. Instead, refer to the PMI Handbook and the PMBOK:
• https://www.pmi.org/certifications/types/certified‐associate‐capm/exam‐prep
• For simplicity, all agile concepts related to the Planning Process Group have been collected here.
• When preparing for the exam, be familiar with the following agile project management terms and
concepts.
• Product backlog, release backlog, iteration backlog
• Product roadmap
• Aspects/Elements of release planning and iteration planning
• Stories and epics
• Verification and validation criteria
• Story points, ideal days, affinity estimating
• Velocity/capacity
276
Processes, Section C
the entry Lesson 5: Planning Processes Section C: Risk
Questions.
277
Lesson 6: Executing
Processes
Executing processes.
278
278
Lesson 6 Topics: Executing Processes
• PMP®/CAPM® Test‐Worthy Topics: • Manage Communications (10.2)
Executing Processes • Implement Risk Responses (11.6)
• Executing Process Group Overview • Conduct Procurements (12.2)
• Direct and Manage Project Work • Manage Stakeholder Engagement
(4.3) (13.3)
• Manage Project Knowledge (4.4) • PMP®/CAPM® Practice Questions
• Manage Quality (8.2)
• Acquire Resources (9.3)
• Develop Team (9.4)
• Manage Team (9.4)
279
Executing Process Group Overview
• The Executing Process Group consists of the processes that carry out
project work
• The execution of plans results in the creation of deliverables that create
value for the organization, add new capabilities to the organizations
existing capacity, which help the organization realize its strategic
objectives enlisted in the project charter, and the business case in the
project’s business documents
• Spending on a project is at its highest when executing project work
• Execution generally is the most complex part of a project, because of
the numerous interactions between competing demands, project
stakeholders, and changing dynamics – within the project, organization
and beyond.
280
Direct and Manage Project Work Process
(PMBOK® Guide 4.3)
• Accomplishing all planned work on the project
• Implementing the project management plan and its
subsidiary plans to guide execution of project work
• Performing activities and producing deliverables
• Identifying and documenting issues in a structured manner
• Generating work performance data
281
Direct and Manage Project Work: Key Outputs
Issue log typically
contains an issue
Deliverables description, the issue
Organization effects, the date when
process asset Work performance the team identified the
updates data issue, the targeted
resolution date, and
possible solutions. Each
Direct and Manage issue typically has an
Project Work owner, identified in the
Project documents Issue log
updates issue log, who has the
responsibility of
monitoring the issue, and
Project working to resolve or
management plan Change requests control it.
updates
282
Direct and Manage Project Work: Key Inputs,
Deliverables
Expert judgment Work performance data
Project
management plan Project Issue log
management Change requests
Project documents
information Project management plan updates
Approved change system Project documents updates
requests
Meetings Organizational process assets
updates
283
Manage Project Knowledge Process
(PMBOK® Guide 4.4)
• **New to PMBOK 6th Edition
• Creating, collecting, distributing and integrating knowledge
and information on the project
• Project performance relies on the availability and best use
of knowledge and information
• Using knowledge management tools and techniques to
motivate the project team and create ways and means to
share their knowledge and learn from others’ knowledge.
284
Manage Project Knowledge: Key Outputs
Lessons learned
register
Manage
Project
Knowledge
Organizational Project
process assets management
285
Manage Project Knowledge: Key Inputs, Tools,
and Techniques
Lessons learned
Project Expert judgment register
management plan Project
Knowledge management management plan
Project updates
documents Information management
Organizational
Deliverables Interpersonal and team skills process assets
updates
286
Knowledge vs. Information
• Knowledge management:
• is the use of tools and techniques to create, gather, disseminate and
integrate knowledge. (More of interactive communication style)
• Examples: networking with people and communities at trade shows,
conferences, fairs, and workshops, along with work shadowing, and training
• Information management:
• is the use of tools and techniques to generate information and
connecting people to it. (More of push or pull communications style)
• Examples: contributing or referring to the lessons learned register, adding data to
project management information systems, reading and discovering information
through online searches, and interacting with subject matter experts
287
126
Manage Quality Process
(PMBOK® Guide 8.2)
• Quality can be achieved by:
• ensuring that the product is of desired quality levels by building it
correctly the first time
• iteratively improving quality through identification and resolution of
defects.
• This process deals with being right, the first time
• Costs of activities performed in this process fall under the cost
of conformance in the cost of quality framework
• The project team assures that stated quality objectives would be
met by following due process, improving processes, and
designing the result to meet the requirements in scope
288
Manage Quality: Key Outputs
Change requests
Test and
Quality reports, evaluation Project
containing information documents management plan
measurements and updates
readings taken of
process and product Manage Quality
quality, summarizing
the level of quality
achieved and, if
Quality reports Project documents
necessary,
updates
recommending steps
to be taken to elevate
quality to desired
levels. 289
Manage Quality: Key Inputs
Quality
management plan Quality control
measurements
Risk report
Quality
Lessons metrics
learned
register
Quality reports
Test and evaluation documents
Change requests
290
Manage Quality: Key Tools and Techniques
Data gathering
(Checklists) Quality reports
Data analysis Test and evaluation
documents
Decision making
Project management Change requests
plan Data representation
Audits Project
Project documents management plan
Design for X
updates
(focus developmental efforts on one req)
Project documents
Problem solving updates
Quality improvement methods
291
Acquire Resources Process
(PMBOK® Guide 9.3)
• Confirming the availability and acquiring physical and
human resources
• In matrix organizations, negotiating with a department
head, or a functional manager to acquire resources
• Preassigning specialized resources when crafting the project
charter or writing a proposal for a prospective client
• Acquiring resources internally or externally through
vendors, contractors, and staffing agencies
292
Acquire Resources: Key Outputs
OPA update examples: Physical
• Documentation resource
related to acquiring, Organizational assignments Project team
assigning and process assets assignments
allocating resources updates
EEF update examples: Enterprise
Acquire Resource
• Resource availability environmental calendars
Resources
in the organization factors updates
• Amount of
organization’s
Project Change
consumables used documents requests
updates Project
management
plan updates
293
Acquire Resources: Key Inputs, Tools, and
Techniques
Physical resource
assignments
Project team assignments
Decision
Resource calendars
making
Change requests
Project management Interpersonal
plan Project management plan
and team skills updates
Project documents
Pre‐assignment Project documents updates
Virtual teams Enterprise environmental
factors updates
Organizational process
assets updates
294
Develop Team Process
(PMBOK® Guide 9.4)
• Developing the team through
• Open communication
• Trust building behaviors and exercises
• Working collaboratively
• Providing regular constructive feedback
• Rewarding high performance
• Assessing the team’s performance on factors such as
individual skills, collective competencies, knowledge sharing,
collaboration, and staff attrition
295
Develop Team: Key Outputs
Team
performance
assessments
Organizational
process assets Change
updates requests
Develop Team
Enterprise Project
environmental management
factors updates plan updates
Project
documents
updates
296
Develop Team: Key Inputs
Resource Project team
Team
management
charter assignments
plan
Project
schedule Resource
calendars
Lessons
learned
register
Team performance assessments
Change requests
297
Develop Team: Key Tools and Techniques
Team performance
Colocation assessments
Virtual teams Change requests
Project management
Project Communication technology plan updates
management Interpersonal and team skills Project documents
plan updates
Project Recognition and rewards
Enterprise
documents Training environmental
factors updates
Individual and team assessments
Organizational
Meetings process assets
Project Management Institute, A Guide to the Project Management Body of Knowledge, (PMBOK® Guide) ‐ Sixth updates
298
Manage Team Process
(PMBOK® Guide 9.5)
• Tracking performance, providing feedback, resolving issues, and
managing team changes to help the team become more self‐
directing and high‐performing
• Optimizing project performance while engendering project team
growth and morale
• Coaching the team so they can eventually manage themselves
• Reviewing the team performance assessment and work
performance reports, followed by using a variety of
interpersonal skills, team skills, leadership skills, to help the team
improve their communications, conflict resolution skills, and
overall performance
299
Manage Team: Key Outputs
Change requests
Enterprise Project
environmental Manage Team management
factors updates plan updates
Project
documents
updates
300
Manage Team: Key Inputs
Team performance
Resource Project team
management plan assessments assignments
Lessons Work performance
learned reports
register
Team Issue
charter log
Change requests
301
Manage Team: Key Tools and Techniques
Change requests
Project management
plan Project management
plan updates
Project documents Interpersonal and team skills
Project documents
Work performance Project management information updates
reports system
Enterprise
Team performance
environmental
assessments
factors updates
302
Manage Team: Key Tools and Techniques –
Conflict Management
• The Manage Team process includes the tool and technique,
“interpersonal and team skills”, which covers a variety of
important skills the project manager should possess.
• In particular, this tool and technique describes conflict
management techniques.
• Common conflict management techniques include
• Collaborate/problem solve
• Withdraw/avoid
• Smooth/accommodate
• Compromise/reconcile
• Force/direct
303
Conflict Resolution (Cont.)
Conflict Resolution Description Example
Technique
Collaborating/ Problem Collaborating/problem solving is an If it’s taking too long for a team member
Solving effort in which attempts are made to to create status reports, maybe buy
work out the actual problem. It is the better reporting software and devise
best type of conflict resolution. better ways to collect the data.
Compromising/ Compromising/reconciling is a If we can get labor to give in on benefits a
Reconciling negotiation attempt to get everyone little, and management to increase their
involved to give (concede) a little to raise a little, I think we can find
find a common ground and resolution. agreement that both sides can live with.
It is sometimes viewed as undesirable
because when everyone gives
something up, there is a potential that
the solution might fail to meet
anyone’s needs.
304
Conflict Resolution (Cont.)
Conflict Resolution Description Example
Technique
Forcing/ Forcing/directing is an action in which a direct You will stop using that software and switch
Directing order to resolve something is given. It is to the authorized version or you will not be
typically the worst type of conflict resolution. around here for long.
Smoothing/ Smoothing/accommodating is an attempt to Look at how well the requirements on the
Accommodating focus on the positive and distract the attention project went. We just have to apply that
from the negative. same view to this phase of the project as
well.
Withdrawing/ In withdrawing/avoiding, the project manager I know he is a pain to work with, and takes
Avoiding ignores the problem and hopes it either fixes longer to do his work than we like, but
itself or disappears. Typically, withdrawal is maybe if we let him be, he will just quit and
not viewed by PMI as a conflict resolution take a new job.
technique because it’s not a proactive
approach to resolving conflict.
305
Exercise: Conflict Management Techniques
The team is evaluating whether they should use Technology X or Technology Y.
For each of the following scenarios, indicate whether the approach involves
collaborating/problem solving, withdrawing/avoiding, smoothing/accommodating,
compromising/reconciling, or forcing/directing:
1.The project manager wants to postpone the decision until senior management
announces the yearly budget, which will determine how much money will be available
to acquire the needed technology, which could influence the decision.
2.The team suggests using Technology X for one portion of the work, and Technology Y
for a second portion of the work. The technologies will not interfere with one another.
3.The project manager informs the team that an existing contract requires the team to
use Y.
4.The team suggests testing both technologies in prototypes to determine which
performs better.
5.The project manager decides to use Technology X, as a senior team member strongly
favors this technology. Choosing Technology Y would inevitably result in strong
resentment and pushback from this senior team member.
306
Exercise: Conflict Management Techniques
1.The project manager wants to postpone the decision until senior
management announces the yearly budget, which will determine how
much money will be available to acquire the needed technology, which
could influence the decision. Withdrawing/avoiding
2.The team suggests using Technology X for one portion of the work, and
Technology Y for a second portion of the work. The technologies will not
interfere with one another. Compromising/reconciling
3.The project manager informs the team that an existing contract
requires the team to use Y. Forcing/directing
4.The team suggests testing both technologies in prototypes to determine
which performs better. Collaborating/problem solving
5.The project manager decides to use Technology X, as a senior team
member strongly favors this technology. Choosing Technology Y would
inevitably result in strong resentment and pushback from this senior
team member. Smoothing/accommodating
307
Manage Communications Process
• The process Manage Communications involves implementing the
communication management plan and the stakeholder engagement plan to
produce project communications that inform and involve stakeholders, and
to enable decision making.
• A full‐time project manager often spends the majority of time communicating.
Accordingly, the project manager must strive to continuously improve
his/her communication and interpersonal skills, including
• Providing feedback
• Making presentations
• Interpreting non‐verbal communications
• Building trusted relationships
• Communicating effectively depends on understanding the changing needs of
stakeholders.
308
Manage Communications: Key Outputs
Project
communications
Organizational Project
Manage management
process assets
Communications plan updates
updates
Project
documents
updates
309
Project Communication Examples
• Progress reports • Post‐its • Slouching
• Meeting minutes • Emails • Sighs
• Presentations • IMs • Raised Voice
• Records • Plans • Flyers
• Reports • Voicemail • Training Manuals
• Memos • Phone calls • Labels
• Posts online • Charts • Posters
• Passing comments • Smiles • Calendars
• Meetings • Frowns • Head in hands
• Video Conferencing • Rolling Eyes • Handshake
We care because communication has long‐lasting, far‐reaching, big‐impacting
effect! For example, project communications may be archived for future
reference and/or used as templates and assets for the organization.
310
Manage Communications: Key Inputs
Issue log Work Resource
Change Quality
performance management
log report
reports plan
Stakeholder
register Lessons learned Stakeholder
register engagement plan
Risk Communications
report management
plan
Project communications
311
Manage Communications: Key Tools and
Techniques
Communication technology
Communication methods Project communications
Project management Communication skills Project management
plan plan updates
Project management
information system
Work performance updates
reports Project reporting Organizational process
Interpersonal and team skills assets updates
Meetings
312
Implement Risk Responses Process
• ***New to PMBOK Sixth Edition
• Ensuring that agreed‐upon risk responses are implemented by risk
owner and relevant stakeholders with the goal of maintaining the
project at an acceptable level of risk
• Planning risk responses doesn’t guarantee the execution of those
responses: the project manager may need to influence stakeholders
and risk owners to execute the agreed‐upon risk responses.
• Implementing risk responses not only addresses the project’s overall risk
exposure, but also strengthens the performing organization’s resilience
to risks by creating a culture that proactively manages risks.
313
Implement Risk Responses: Key Outputs
Change requests
Implement Risk
Responses
Project
documents
updates
314
Implement Risk Responses: Key Inputs, Tools,
and Techniques
Project Expert judgment
management Interpersonal and Change requests
plan team skills Project documents
Project updates
Project management
documents information system
315
Conduct Procurements Process
1. Publishing the Request For Quote/Request For Proposal and
the procurement statement of work
2. Advertising and seeking responses from interested and
qualified vendors
3. Evaluating bids/proposals on numerous, predetermined
weighting and screening criteria to determine suitable vendors
4. Negotiating with these shortlisted vendors
5. Making an offer to the desired seller
6. Entering into an agreement (e.g., contract, service level
agreement, memorandum of understanding) with the external
organization
316
Procurement: Procurement Documents
Document Typical Purpose Description Example
Type
Request for Typically used to solicit A document requesting A request from a state
Information •
information to learn information on a service government to see if a consulting
(RFI) •
more about a company provider’s qualifications company has the appropriate
that could provide service so a buyer can review experience in an area to bid for a
for a buyer them project
Request for Typically used to solicit A document requesting a A request for prospective sellers
Quote •
proposals for a small price for a standard item wishing to provide pricing for
(RFQ) dollar amount or used for There is a general customer‐established server
commodity type of assumption that criteria: Quantity 50 XYZ Servers
products that do not negotiation is not with 1G RAM, 200G hard drive to
require a great degree of associated with this type be purchased within 90 days of
customization of procurement submittal.
document.
317
•
Procurement: Procurement Documents (Cont.)
Document Typical Purpose Description Example
Type
Request for Typically used to solicit A document that requests A request for a proposal to
•
Proposal proposals for bigger, an approach, price, and prospective sellers for design,

•
(RFP) higher priced, customized significant detail about implementation, and training for

sometimes called services or products how the seller proposes a data warehouse to consolidate
Request for (Generally, the seller to do the requested work five different enterprise
Tender (RFT) describes the detailed The general assumption is databases at a fortune 500
•
approach for the solution that negotiations occur company named Widgets, Inc.

to the buyer, including based on scope, time,
previous experience in and cost of what the
the area.) buyer requested and
what the seller
suggested.
318
•
Conduct Procurements: Other Concepts
• Five elements of a binding contract include:
• Offer
• Acceptance
• Consideration (something of value received by both parties)
• Legal capacity (separate legal parties, empowered by their
organization, competent parties)
• Legal age
• Words in contracts generally given more weight than
numbers if there is a dispute. For example
• “The seller will be paid fifty dollars ($5.00).”
319
Conduct Procurements: Key Outputs
Selected
vendors
Organizational
process assets Agreements
updates
Conduct
Procurements
Project
documents Change
updates requests
Project
management
plan updates
320
Conduct Procurements: Key Inputs
Communications Procurement
Configuration management plan documentation Procurement
management plan management plan
Risk management plan Requirements
documentation Scope
Requirements management
Lessons Seller
management plan plan
Stakeholder learned proposals
register register
Risk register
Cost Project
baseline schedule
Selected sellers
Agreements
321
Conduct Procurements: Key Tools and
Techniques
Selected vendors
Expert judgment Agreements
Project management Advertising Change requests
plan
Project documents Bidder Project management
conferences plan updates
Procurement Project documents
documentation Data analysis updates
Vendor proposals Interpersonal and Organizational
team skills process assets
updates
322
Bidder Conferences
• Special meetings held prior to the submission of proposals that
the purchasing organization conducts with all interested sellers.
• Aim to answer all seller questions related to the procurement,
ensuring that the all sellers have the same understanding of the
requirements, and that no particular seller receives favored
treatment.
• On the other hand, the procuring organization must strive to
minimize the likelihood of collusion.
• Collusion involves the illegal collaboration between competing
vendors. For example, if only two firms have the capabilities to provide
a particular service, those firms may agree to inflate their prices in their
proposals, with tacit agreements that the firm that wins the contract
will subcontract part of the work to the other firm.
323
Manage Stakeholder Engagement Process
• Communicating and working with stakeholders, as outlined in
the stakeholder engagement plan, to meet their needs and
expectations, address their issues, and to continually foster
their support
• Involving stakeholders in decision making
• Negotiating with negative stakeholders
• The project manager provides an indispensable role in generating
and maintaining support and engagement, and project success
often depends on receiving support from powerful and
influential stakeholders
324
Manage Stakeholder Engagement: Key
Outputs
Change
requests
Manage
Stakeholder
Engagement
Project Project
325
Manage Stakeholder Engagement: Key Inputs,
Expert judgment
Communication skills Change requests
Project Project management
management plan Interpersonal and
plan updates
team skills
Ground rules updates
Meetings
326
• For simplicity, all agile concepts related to both the Executing Process Group and the
Monitoring and Controlling Process Group have been collected here.
• When preparing for the exam, be familiar with the following agile project management
terms and concepts.
• Wireframes, storyboards, and protypes
• Fist of fives
• Standup meetings/daily scrums
• Tracking best practices; Information radiators and refrigerators
• Continuous integration, test‐driven development, refactoring
• Backlog grooming
• Product reviews (demonstrations)
• Iteration, release, and product retrospectives
• For more information on these agile topics and the location of agile practice questions, see
below.
327
Lesson 6 Review: Executing Processes
• PMP®/CAPM® Test‐Worthy Topics: • Manage Communications (10.2)
Executing Processes • Implement Risk Responses (11.6)
• Executing Process Group Overview • Conduct Procurements (12.2)
• Direct and Manage Project Work • Manage Stakeholder Engagement
(4.3) (13.3)
• Manage Project Knowledge (4.4) • PMP®/CAPM® Practice Questions
• Manage Quality (8.2) • What are your questions?
• Acquire Resources (9.3)
• Develop Team (9.4)
• Manage Team (9.4)
328
PMP®/CAPM® Practice Questions: Executing
Processes
the entry Lessons 6: Executing Processes Questions.
329
Lesson 7: Monitoring and
Controlling Processes
Monitoring and Controlling processes.
330
330
Lesson 7 Topics: Monitoring and Controlling
Processes
• PMP®/CAPM® Test‐Worthy Topics: • Control Schedule (6.6)
Monitoring and Controlling • Control Costs (7.4)
Processes
• Monitoring and Controlling Process • Control Quality (8.3)
Group Overview • Control Resources (9.6)
• Monitor and Control Project Work • Monitor Communications (10.3)
(4.5) • Monitor Risks (11.7)
• Perform Integrated Change Control • Control Procurements (12.3)
(4.6)
• Monitor Stakeholder Engagement
• Validate Scope (5.5) (13.4)
• Control Scope (5.6) • PMP®/CAPM® Practice Questions
331
Monitoring and Controlling Process Group
Overview
• Ensures that the actual work performed aligns to the project
management plan and other planning documents
• Emphasizes a proactive approach to both performance and issues
• Recommends the necessary actions and steps to maximize the
likelihood of project success
• Ensures that the organization and the project team follow a
standardized process to evaluate all requested changes
• Performed throughout the project lifecycle
• The project manager is accountable for ensuring the project meets the
business and project objectives and conforms to the project’s approved
scope, schedule, and cost baselines.
332
Monitor and Control Project Work Process
(PMBOK® Guide 4.5)
• Tracking the project’s performance and generating work
performance reports that identify variations between
planned results and actual results
• Recommending corresponding preventive and corrective
actions to improve project performance
333
Monitor and Control Project Work: Key
Outputs
Reports that show progress,
Work
forecasts, charts, KPIs, issues and
performance
risks.
reports
Project Monitor and
documents Control Project Change requests
updates Work
Project
management plan
updates
334
Monitor and Control Project Work: Key Tools
and Techniques
Project management Work performance
plan Expert judgment reports
Project documents Data analysis Change requests
Project management plan
Work performance Decision making updates
information Meetings Project documents
Agreements updates
335
Perform Integrated Change Control Process
(PMBOK® Guide 4.6) (1 of 2)
• Involves the evaluation by relevant stakeholders (e.g.,
project manager, sponsor, Change Control Board) of
proposed changes to controlled project items (e.g., project
management plan elements, deliverables, controlled
documents), and managing those changes efficiently and
effectively
• For agile projects ‐ welcoming all value‐added changes,
even late in the project
• Preventing unnecessary change and protecting the project
objectives
336
Perform Integrated Change Control Process
(PMBOK® Guide 4.6) (Continued) (2 of 2)
• This process is mandatory when a proposed change affects any
element of the project management plan (e.g., scope, schedule, and
cost baselines; any subsidiary management plans) and any document
the organization deems important enough to control.
• **The change management plan and the configuration management
plan specify which documents require the formal change control
process.
• Generally, integrated change control is not required prior to finalizing
the project management plan, or if reserves are available for specific
risks and events.
• The project manager accountable for requiring all proposed changes
follow the Integrated Change Control process.
337
Exercise: Integrated Change Control Steps
Using your experience and judgment, rearrange the following steps related to
processing a requested change into the correct order.
• Approve or deny the change
• Assess and evaluate the proposed change
• Close the change record
• Create the Request For Change (RFC)
• Implement the change
• Inform relevant stakeholders
• Record the Request For Change (RFC)
• Review the implemented change
• Review the Request For Change (RFC) for completeness
• Update relevant documents
338
Answers: Integrated Change Control Steps
Create the Review the Assess and
Record the evaluate the
Request For RFC for proposed
RFC
Change (RFC) completeness change
Inform Update Approve or

Implement
relevant relevant deny the
the change
stakeholders documents change
Review the Close the
implemented change
change record
339
Perform Integrated Change Control: Key
Outputs
Approved
change
requests
Perform
Integrated
Change
Control
Project Project
340
Perform Integrated Change Control: Key
Inputs, Tools, and Techniques
Expert judgment
Project
management plan Change control tools Approved change
requests
(Change Log)
Project documents Project management
Data analysis
Work performance plan updates
Decision making
reports Project documents
Meetings updates
Change requests (Change Control Board, CCB)
341
Validate Scope Process (PMBOK® Guide 5.5)
• Conducting a formal review of completed deliverables by the
customer or the sponsor with the goal of obtaining approval of
those deliverables
• Validating that deliverables:
• meet the customer’s expectations
• (fitness for use)
• meet product requirements
• (conformance to requirements/specifications)
• Initiating appropriate actions (e.g., change requests, lessons
learned) if the customer or sponsor declines to approve
deliverables
342
Validate Scope: Key Outputs
Work
performance
information
Project Accepted
document Validate Scope deliverables
updates
Change requests
343
Validate Scope: Key Inputs, Tools, and
Techniques
Project management Accepted deliverables
plan Inspection Work performance
Project documents (Demos, walkthroughs, information
reviews) Change requests
Verified deliverables
Decision making Project document
Work performance data updates
344
Control Scope Process (PMBOK® Guide 5.6)
• Ensuring the team creates all agreed‐upon deliverables and perform all agreed‐
upon work listed in the most recent scope baseline
• Managing changes to the scope baseline and associated documentation by
routing all proposed scope changes through the process of Integrated Change
Control
• Updating relevant documentation (e.g., requirements documentation, project
scope statement, WBS)
• Eliminating unmanaged scope, such as scope creep and gold plating
• Gold Plating: the team adding features with the hopes of surprising and delighting the
customer
• ***Uncontrolled changes cause many projects to fail, or at a minimum, they
negatively impact other project objectives, such as cost, schedule, resources,
quality, and risk.
• Thus, effective scope control greatly influences project success, and increases the
likelihood that the project will deliver the intended benefits.
345
Control Scope: Key Outputs
Work
performance
information
Project
document Control Scope Change requests
updates
Project
management
plan updates
346
Control Scope: Key Inputs, Tools, and
Techniques
Work performance
Project management information
plan Data analysis Change requests
Project documents Project management
(Variance Analysis) plan updates
Work performance data Project document
updates
347
Control Schedule Process (PMBOK® Guide 6.6)
• Ensuring the team completes deliverables and performs work according to
the most recent, agreed‐upon schedule
• Comparing the project’s actual schedule performance (e.g., actual start dates,
finish dates, and hours of effort) with the planned schedule to determine
schedule‐related work performance information.
• Using earned value analysis, performance reviews, and schedule forecasts.
• If applicable, submitting change requests to improve schedule performance.
• Managing changes to the schedule baseline and associated documentation by
routing these requests through the process Integrated Change Control
• Employing a variety of schedule‐oriented techniques such as:
• using schedule compression (crashing and/or fast tracking)
• adjusting leads and lags
• applying resource optimization techniques (resource smoothing and leveling)
• Continually reviewing the project’s critical path activities to determine
performance, assess risks, and respond to issues
348
Control Schedule: Key Outputs
Work performance
Project information
documents Schedule forecasts
updates
Control Schedule
Project
management plan Change requests
updates
349
Control Schedule: Key Inputs
Schedule Schedule
Lessons learned management plan baseline Resource calendars
register
Schedule Performance
Project data measurement baseline
schedule Scope baseline
Work
performance
data Project
calendars
Schedule forecasts
Work performance information
Change requests
350
Control Schedule: Key Tools and Techniques
Data analysis
Critical path method Work performance information
Project management
Schedule forecasts
plan Project management
information system Change requests
Project documents
Work performance Resource optimization updates
data
Leads and lags Project document updates
Schedule compression
351
Control Costs (PMBOK® Guide 7.4)
• Comparing baseline versus actual expenditures and funding at
the activity, work package, deliverable, and project levels to
produce cost‐related work performance information, including
cost forecasts.
• Investigate the reasons behind any variances and generating
change requests and/or corrective actions to bring future
performance in line with planned performance
• Ensuring that actual expenditures lead to the creation of
deliverables that meet quality expectations
• Ensuring that no changes to the cost baseline occur without
proper routing through the process Integrated Change Control
352
Control Costs: Key Outputs
Work performance
Project document information
Cost forecasts
updates
Control Costs
Project
management plan Change requests
updates
353
Control Costs: Key Inputs
Cost management Cost baseline Lessons learned

plan register
Project
funding Work performance
requirements data
Change requests
354
Control Costs: Key Tools and Techniques
Expert judgement Work performance
Data analysis information
Cost forecasts
Project documents (Earned Value, Reserve)
Change requests
Project funding To‐complete
requirements Project management
performance index plan updates
Work performance data
Project management Project document
information system updates
355
Earned Value Analysis (EVA)
• Involves the examination and comparison of
against
planned schedule and cost actual schedule and cost metrics
to determine overall project performance.
356
Earned Value: Key Metrics
• Budget At Completion (BAC): the cost baseline – the amount of
money expected to be spent on the project, including contingency
reserves.
• Assume BAC = $100,000
• Planned Value (PV): the baseline value of the work that should have
been completed, as of the reporting date.
• Assume PV = $40,000
• Earned Valued (EV): the baseline value for the work that was
accomplished, as of the reporting date.
• Assume EV = $30,000
• behind schedule; $10,000 work not completed
• Actual Cost (AC): the actual amount of money spent on the work that
was accomplished, as of the reporting date.
• Assume AC = $35,000
• overbudget; spent $5,000 more than expected for completed work
357
Earned Value: Variances, Indices, Interpretations
• Schedule Variance (SV) = EV ‐ PV. In this example, SV = $30,000 ‐ $40,000 = ($10,000).
• An SV < $0 means behind schedule; an SV > $0 means ahead of schedule.
• The team failed to complete work with a baseline cost of $10,000.
• Schedule Performance Index (SPI) = EV/PV. In this example, SPI= $30,000/$40,000 = .75.
• An SPI < 1 means behind schedule; an SPI > 1 means ahead of schedule.
• The team created only 75% of the planned work deliverables.
• Cost Variance (CV) = EV ‐ AC. In this example, CV = $30,000 ‐ $35,000 = ($5,000).
• A CV < $0 means the project is over budget; a CV > $0 is under budget.
• The team spent $5,000 more than expected on the completed work.
• Cost Performance Index = EV/AC. In this example, CPI = $30,000/$35,000 = .857.
• A CPI < 1 means over budget; a CPI > 1 means under budget.
• Thus, the team is only receiving 85.7 cents of value for every dollar they are spending.
• Note: variances (SV and CV) use subtraction, and indices (SPI and CPI) use division.
• All four formulas begin with EV. 358
Earned Value: Forecasts
• Estimate At Completion (EAC): expected total project cost based on current
performance. Though there are three different formulas, the team chooses the
one that most accurately reflects their current performance.
1. EAC = AC + Bottom‐up (new) ETC
• Actual costs different than planned. Assume new ETC equals $75,000. In this case, EAC =
$110,000 = ($35,000 + $75,000).
2. EAC = AC + (BAC ‐ EV)
• The current cost variance will not influence future performance. In this case, EAC =
$105,000 = $35,000 + ($100,000‐$30,000)
3. EAC = BAC/CPI
• Current spending expected to continue. In this case, EAC = $116,686 = $100,000/.857
(rounded).
• Estimate To Completion (ETC) = EAC ‐ AC. The expected remaining amount of
money to complete the work. For the values of EACs listed above
1. ETC = $110,000 ‐ $35,000 = $75,000
2. ETC = $105,000 ‐ $35,000 = $70,000
3. ETC = $116,686 ‐ $35,000 = $81,686
359
Earned Value: Variance At Completion (VAC)
• The expected cost variance for the entire project based on current
performance
• VAC = BAC ‐ EAC
• A VAC less than $0 means the project is expected to cost more than planned;
a VAC greater than $0 means the project is expected to cost less than planned.
• Based on the values of EAC on the previous slide of $110,000, $105,000, and
$116,686:
1. VAC = $100,000 ‐ $110,000 = ($10,000)
2. VAC = $100,000 ‐ $105,000 = ($5,000)
3. VAC = $100,000 ‐ $116,686 = ($16,686)
• Using the three values of VAC, above, the project is expected to exceed the
original budget by $10,000, $5,000, and $16,686 respectively.
360
Earned Value: To‐Complete Performance
Index (TCPI)
• Provides a measure of how efficiently the team must manage their
remaining project money to complete the remaining work
• TCPI = (BAC ‐ EV)/(BAC ‐ AC)
• in other words: Remaining Project Work/Remaining Project Money
• Based on the values from previous slides,
• Remaining work = $70,000 = BAC ‐ EV = $100,000 ‐ $30,000
• Remaining money = $65,000 = BAC ‐ AC= $100,000 ‐ $35,000
• Thus, TCPI = $70,000/$65,000 = 1.077 (rounded)
• Meaning: for every $1 of money remaining, the team must find a way to earn
$1.077 to correct the current $5,000 variance.
• TCPI greater than 1.00 means the project is currently overbudget, and the
team will need to earn more than $1 of value for every $1 left in the budget.
• A TCPI less than 1.00 means the project is currently under budget.
361
Earned Value: S‐Curves
Earned Value
2500
Gap between EV and PV
2000 indicates a schedule variance.
1500
1000
500 Gap between EV and AC
indicates a cost variance.
0
Week 1 Week 2 Week 3 Week 4 Week 5 Week 6 Week 7 Week 8
EV PV AC
362
Earned Value Management (EVM) (Cost Analysis Only)
• Perhaps the easiest way to understand EVM and Cost Analysis is to look at the
components and formulas within the context of a home building project.
• To determine EARNED VALUE and perform COST and SCHEDULE analysis, you need
to know the total project value and, at a distinct point in time, the completion
percentage, the amount of work that should have been completed, and the
amount that has been spent.
• For our example:
• The overall planned value of the project is $100,000.
• At the end of the day today (a specific point in time):
• The house is 40% completed, thus $40,000 in work done so far
• The amount of work that should have been completed is $60,000
• The amount that has been spent is $80,000
363
Earned Value Management (EVM)
Determining Earned Value
•
Component
•
•
Definition Calculation/Amount
Budget at Completion (BAC) The amount you expect the project to Total the costs of each project work
cost package without regard to
completion status: $100,000
•
**May have to be done per activity
Planned Value (PV) The value of the work that should have Total the value of each project

been completed at a specific point in activity scheduled for completion at
time, excluding any work started ahead a specific point in time: $60,000
• of schedule
Actual Cost (AC) The cost of the work that has been Total all the project costs at a

•
completed at a specific point in time, specific point in time:
including any work started ahead of $80,000
•
schedule 364
Earned Value Management (EVM)
Determining Earned Value (Cont.)
Component Definition Calculation/Amount
Earned Value (EV) A measurement of the BAC multiplied by

progress of a project and the percentage complete
basis for cost analysis, (40%):
including any work started $100,000*40%=$40,000
ahead of schedule **This is often done per
activity up to this point in
time.
365
Cost: Earned Value Management (EVM) – (Cont.)
Performing Cost Analysis (Cont.)
Index/Variance Formula/Result Result Interpretation
Cost Variance (CV) EV‐AC A variance indicator that denotes the difference between the

$40,000 ‐ $80,000 = ($40,000) value of the work completed
and cost of the work completed.
Be able to calculate EV or AC if
given CV and EV or AC. If the result is 0, the project is on track.
For example: If the result is greater than 0, the project is under budget.
AC + CV = EV If the result is less than 0, the project is over budget.
or
EV – CV = AC In this case, the result is less than 0;
therefore the project is over budget by $40,000.
366
Earned Value Management (EVM) – (Cont.)
Performing Cost Analysis
Index/Variance Formula/Result Result Interpretation
Cost EV / AC An efficiency indicator that denotes the return on each dollar spent at a single

Performance $40,000 / $80,000 = 0.5 point in time.
Index (CPI) If the result is 1.0, the return on the project at a single point in time is on track.
Be able to calculate EV If the result is greater than 1.0, the return on the project is under budget.
or AC if given CPI and If the result is less than 1.0, the return on the project is over budget.
EV or AC.
For example:
A CPI of .5 means that the project is getting 50 cents of
AC x CPI = EV
work done for every dollar spent.
or
EV/CPI = AC
367
Cost: Forecasts
Forecasts are estimates or predictions of the future state of the project based on past
performance and expected future performance.
Cost Formula* Description
Forecast Varied Approaches
Estimate at EAC=BAC/CPI The estimate at completion (EAC) represents the current projected

Completion Or final cost based on the current spending efficiency (CPI).
(EAC) $100,000/0.5 If you have a CPI greater than one (>1), the number will be less than
***Remember, =$200,000 the BAC, meaning that the project will likely finish under budget.
there are 3 possible ***This formula is if we
If you have a CPI of less than one (<1), the number will be greater
formulas here based expect the current
than the BAC, meaning that the project will finish over budget.
on what caused the spending to continue
past variance and if If the CPI equals 1, the project will finish on budget.
we expect that
cause to continue. EAC: $200,000 (This is on pace to come in over the BAC
of $100,000 in our example on the previous pages.)
368
Cost: Forecasts (Cont.)
Forecast
Estimate to ETC=EAC‐AC The estimate to complete (ETC) represents the amount needed to finish the

Complete Or project based on the current spending efficiency of the project. This figure is
(ETC) $200,000‐$80,000= the EAC without the actual cost to date.
$120,000 ETC: $120,000 (It is on pace to exceed the BAC amount when factoring in what
has already been spent in our example in the previous pages.)
Variance at VAC=BAC‐EAC The variance at completion (VAC) is the difference between the budget at

Completion Or completion (BAC) and the estimate at completion (EAC). This difference tells
(VAC) $100,000 ‐200,000 = how much over or under budget the project might finish.
($100,000) VAC: $100,000 (This figure is the projected over budget amount, based on the
current spending efficiency of the project in our example on the previous
pages.)
369
Cost: Forecasts (Cont.)
Forecast
To‐complete TCPI= An efficiency indicator that denotes the efficiency needed from the remaining

Performance Index (BAC ‐EV)/ resources to meet the cost goals of the project and finish the project on budget.
(TCPI) (BAC ‐ AC)
Or In other words, the To Complete Performance Index (TCPI) is the estimate of the
($100k ‐ $40k) / future cost performance that you may need to complete the project within the
($100k ‐ $80k) approved budget (which is either the initial approved budget (BAC), or a newly
=3.0 calculated budget/estimate at completion (EAC)).
It’s like saying “if we want to stay on budget, we’ll have to continue with a
future Cost Performance Index of x.
In this scenario, it’s like saying from now on we’ll have to
get 3 times the amount of work per planned dollar!
370
Earned Value: Summary of Formulas Discussed
• EV: BAC*% Completed work
• SV: EV ‐ PV
• SPI: EV/PV
• CV: EV ‐ AC
• CPI: EV/AC
• EAC = AC + ETC (Most common and accurate; uses Management ETC: adding expected costs of all remaining
activities)
• EAC = AC + (BAC ‐ EV) (Past cost performance may have differed, but future cost performance expected to
align with planned)
• EAC = BAC/CPI (Past cost performance expected to continue)
• ETC: (BAC ‐ EV)/CPI or EAC ‐ AC

• VAC = BAC ‐ EAC
• TCPI = (BAC ‐ EV)/(BAC ‐ AC)
371
Exercise: Earned Value
Answer the following questions. Refer to the formulas on the previous page if necessary.
A project has total expected development costs of $50,000. The project manager determines the following on status reporting day:
Activity A has an expected development cost of $5,000. It should be 100% complete. It’s currently 100% complete, has an actual cost of $6,000
Activity B has an expected development cost of $8,000. It should be 100% complete. It’s currently 60% complete, has an actual cost of $5,500
Questions:
1. What is AC for the project?
2. What is EV for the project?
3. What is PV for the project?
Double‐check your work for Questions 1‐3 before you begin the remaining questions. Make sure you’ve done the math correctly.
4. What is SV for the project?
5. Based on the value of SV, what can you determine about the project?
6. What is CPI for the project?
7. Based on the value of CPI, what can you determine about the project?
****The current cost performance is attributed to the cost of raw material being more expensive than expected, and the remaining activities
require the same types and quantities of resources.
8. What is EAC for the project?
9. What is VAC for the project?
10. What does the VAC mean for the project?
11. What is ETC for the project?
372
Exercise Answers: Earned Value
1. AC = $11,500 ($6,000 + $5,500)
2. EV = $9,800 ($5,000 + $8,000*.6) = ($5,000 + $4,800)
3. PV = $13,000 ($5,000 + $8,000)
4. SV = ‐$3,200 ($9,800 ‐ $13,000)
5. Behind schedule (less than $0)
6. CPI = .852 (rounded; $9,800/$11,500)
7. Overbudget (less than 1; only getting 85.2 cents for every dollar spent)
8. EAC = $58,685 ($50,000/.852)
9. VAC = ‐$8,685 ($50,000 ‐ $58,685)
10. At this moment, the project is expected to cost $8,685 more than expected.
11. ETC = $47,185 ($58,685 ‐ $11,500)
Remember to practice schedule formulas as well!
373
Control Quality Process
(PMBOK® Guide 8.3)
• Producing quality‐related work performance information, such as
whether the project deliverables comply with planned standards,
regulations, requirements, and specifications, typically listed in the
quality management plan and requirements documentation
• Ensuring that the project produces complete and correct outputs
• Recording defects, investigating root cause(s) and potentially
recommending change requests
• Performing population testing or statistical sample testing
• Optimally, achieving the goal of “verified deliverables”: those tested
deliverables that successfully meet all relevant requirements (an input
to the process Validate Scope, discussed earlier)
374
Control Quality: Key Outputs
Quality control
measurements
Project
documents Verified
updates deliverables
Control Quality
Project Work
management performance
plan updates information
Change
requests
375
Control Quality: Key Inputs
Quality management plan
Lessons learned Test and evaluation
register documents
Quality metrics
Deliverables Approved
Work change
performance requests
data
Quality control measurements
Verified deliverables
Change requests
376
Control Quality: Key Tools and Techniques
Data gathering Quality control
(Check Sheets, Surveys) measurements
Project management plan Data analysis Verified deliverables
Project documents Inspection Work performance
Approved change requests Testing/product evaluations information
Deliverables Data representation Change requests
Work performance data (Control, Pareto, Histogram Project management plan
and Scatter Charts, Ishikawa) updates
Meetings Project documents updates
377
Check Sheets
Check sheets help gather data about the attributes or defects in deliverables
Morning Shift Afternoon Shift Total

Wrong Shape 5 4 9
Wrong Color 2 0 2
Wrong Weight 3 4 7
Wrong Height 9 8 17
Wrong Width 3 3 6
Totals 22 19 41
378
Pareto Charts
Pareto charts help organizations focus on eliminating the most significant cause first, the second most
significant cause next, etc.
Causes of Scrapped Products
100 100%
90
80
70
60
50 50%
40
30
20
10
0 0%
Machine Calibration Poor Raw Materials Improper Storage Shipping Damage
379
Control Charts
Provide an indication of whether a process produces acceptable or “out of control” outputs. This chart
shows an average (mean) of 100% schedule performance. This implies that the organization runs the
average projects at 100% schedule performance. The organization has set Lower Control Limits (LCL) and
Upper Control Limits (UCL) at 97% and 103%, respectively.
Schedule Performance
<100% implies behind schedule
108% UCL, 103%
Mean, 100%
100% LCL, 97%
Out of Control,
92% 96%
Week 1 Week 2 Week 3 Week 4 Week 5 Week 6
380
Histograms
Histograms provide a graphical representation of data in bar chart format. Histograms can lead
to more detailed quantitative (and/or qualitative) investigation, such as finding statistical
correlations or root causes. For the process Control Quality, histograms can display the number
of defects discovered related to specific products, components, project phases, or any other
relevant aspect.
Types of Defects
30
25
20
15
10
Missing components Wrong Components Extra Components Defective Components
381
Generally show the potential
Scatter Diagrams correlation between variables. For
the process Control Quality, they
could show the potential correlation
X axis = Weeks of PM training between work hours and defects, or
Y axis = Schedule Performance between training and morale.
110% Briefly, scatter diagrams explore
whether variables are related
100% (correlation), not whether one
variable causes the other (causality).
90% As an often‐cited example, consider
these two statements:
80%
1. Ice cream consumption and
70% drowning deaths are related. On
days when people eat more ice
60% cream, there are more drowning
deaths (correlation).
50% 2. Eating ice cream increases the
0 1 2 3 4 5 chances of drowning (causality).
382
Exercise: Control Quality Tools and Techniques
Match each quality control scenario with an appropriate tool or technique that could adequately
address that scenario.
Tools and techniques: check sheets, checklist, control charts, cause‐and‐effect diagrams,
histograms, questionnaires and surveys, scatter diagrams
• The team needs to measure products (e.g., height, weight, density, torque) or service outcomes
(e.g., service times) where they have well‐defined ranges for successful and unsuccessful
outcomes.
• The team member performing a test must indicate the number of defects and the types of
defects (e.g., wrong size, dented components, missing components) found during testing.
• The team wants to know whether schedule performance (amount of work completed
successfully) is related to the temperature within the office.
• The team needs to perform a test with 10 specific steps in a very specific order.
• The team wants to determine whether customers are satisfied with their product in the
operational environment.
• The team wants to visually display the number of defects found in each phase of the project life
cycle (or the number of defects attributable to various departments, products, or other factors).
• The team wants to display the root causes that lead to a particular outcome (e.g., scrap, defects,
warranty claims)
383
Exercise Answers: Control Quality Tools and Techniques
• The team needs to measure products or service outcomes (e.g., service time, height, weight,
density, torque) where they have well‐defined ranges for successful and unsuccessful
outcomes. Control charts
• The team member performing a test must indicate the number of defects and the types of
defects (e.g., wrong size, dented components, missing components) found during testing.
Check sheets or histograms
• The team wants to know if schedule performance (amount of work completed successfully) is
related to the temperature within the office. Scatter diagrams
• The team needs to perform a test with 10 specific steps in a very specific order. Checklist
• The team wants to determine whether customers are satisfied with their product in the
operational environment. Questionnaires and surveys
• The team wants to visually display the number of defects found in each phase of the project
life cycle (or the number of defects attributable to various departments, products, or other
factors). Histograms
• The team wants to display the root causes that lead to a particular outcome (e.g., scrap,
defects, warranty claims) Cause‐and‐effect diagrams (Ishikawa diagrams; fishbone
diagrams)
384
Control Resources Process
(PMBOK® Guide 9.6)
• ***New to the PMBOK Sixth Edition
• Focusing on the effective assignment and use of physical resources (e.g.,
equipment, materials, facilities)
• Ensuring that stakeholders who control physical resources provide those
resources according to plan: in the correct types, quantities, and at the correct
locations
• Comparing actual utilization to planned utilization to generate resource‐related,
work performance information and potential unacceptable variances
• Ensuring the team uses physical resources as planned to maximize efficiencies
• Predicting shortages and overages, communicating resource issues to relevant
stakeholders, initiating corrective and preventative actions
• Submitting change requests related to physical resources to the process
Integrated Change Control
385
Control Resources: Key Outputs
Work
performance
information
Project
Control Change requests
document
Resources
updates
Project
management
plan updates
386
Control Resources: Key Inputs
Resource Physical resource
management plan assignments Resource
Lessons learned
register requirements
Issue log Risk register
Project schedule Resource breakdown
structure
Work performance
data
Agreements
Change requests
387
Control Resources: Key Tools and Techniques
Data analysis
Work performance
(Performance Reviews, information
Project management plan Trend Analysis)
Change requests
Project documents Problem solving
Work performance data Interpersonal and team updates
Agreements skills
Project documents
Project management updates
information system
388
Monitor Communications Process
• Monitoring communications and producing communications‐
related work performance information by evaluating whether:
• the project provides the specified communications as defined in the
communications management plan and the stakeholder management
plan
• the project communications effectively and efficiently inform and
engage stakeholders by sending the right information to the right
audience at the right time using the right channels
• Submitting change requests, as appropriate, with the intent of
continually improving communications and engagement
389
Monitor Communications: Key Outputs
Work
performance
information
Project
Monitor Change requests
document
Communications
updates
Project
management
plan updates
390
Monitor Communications: Key Tools and
Techniques
Expert Judgement Work performance
Project management plan Data Representation information
Project documents Interpersonal and team Change requests
Work performance data skills Project management plan
EEFs Project management updates
OPAs information system Project documents
Meetings updates
391
Monitor Risks Process
• Monitoring the:
• overall level of project risk
• effectiveness of risk management processes
• Performing activities, such as
• Monitoring the implementation and effectiveness of risk responses
• Tracking known risks, and updating the risk register and the risk report to
reflect changing details
• Monitoring low‐ranking risks
• Identifying and analyzing new risks and retiring risks
• Monitoring reserves, and recommending applicable changes
• Generating work performance information, such as determining the level of
compliance to risk policies and procedures and the effectiveness of those policies
and procedures
• Generating lessons learned and recommending changes to improve
effectiveness or efficiency
392
Monitor Risks: Key Outputs
Work
performance
information
Project
document Monitor Risks Change requests
updates
Project
management
plan updates
393
Monitor Risks: Key Inputs, Tools, and
Techniques
Work performance
Project management plan information
Data analysis
Project documents Change requests
(Reserve Analysis)
Work performance data Audits Project management plan
updates
Work performance Meetings Project documents
reports updates
394
Control Procurements Process
• Managing the procurement relationship, making payments,
making applicable corrections, and eventually closing contracts
• Monitoring seller performance, communicating to build effective
working relationships, performing procurement audits, and
recommending beneficial changes
• Resolving claims through (in desired order):
• negotiation, mediation, binding arbitration and litigation
• Generally, performed by SMEs from departments such as
contracting, legal, purchasing, or procurements, though the
project management team should optimally understand all
particulars
395
Control Procurements: Key Outputs
Must close both successful and
unsuccessful procurements.
Closed
procurements
Project Work
document performance
updates information
Control
Procurements
Project Procurement
management documentation
plan updates updates
Change
requests
396
Control Procurements: Key Inputs
Requirements Lessons Approved

learned change Risk register Change
Schedule management plan
register requests Procurement management
baseline Procurement plan
Quality Milestone list management
reports documentation plan
Risk management plan Work Requirements
Assumption performance documentation
log data Stakeholder
Requirements
register
traceability matrix
Agreements
Closed procurements
Change requests
397
Control Procurements: Key Tools and
Techniques
Closed procurements
Project management plan Expert judgment Work performance
Project documents Claims information
Agreements administration Procurement
Procurement documentation updates
Data analysis
documentation Change requests
Approved change requests Inspection Project management plan
Work performance data Audits updates
Project documents updates
398
Claims Administration
• Involves the process of managing and resolving conflicting opinions on
applicable charges and expenses between the buyer and seller.
• Generally, the agreement between the parties specifies the procedures for
performing claims administration to resolve the claims.
• If both parties cannot resolve the claim through the objective interpretation
of the agreement, they should attempt to resolve the claim through
negotiations with a win‐win orientation.
• If this fails, the agreement may specify Alternative Dispute Resolution (ADR)
procedures, such as resolving the dispute through mechanisms such as
mediation, binding arbitration, and (lastly) litigation.
399
Monitor Stakeholder Engagement Process
• Generating work performance information by examining the
compliance to agreed‐upon engagement strategies and
evaluating the effectiveness of those strategies
• Recommending alternative strategies that could produce higher
levels of stakeholder involvement and support
• Using a variety of tools and techniques such as communication
skills, interpersonal skills, and political skills, among others
• Performing root cause analysis and alternatives analysis to
propose activities that should foster more favorable stakeholder
relationships
400
Monitor Stakeholder Engagement: Key
Outputs
Work
performance
information
Project Monitor
document Stakeholder Change requests
updates Engagement
Project
management
plan updates
401
Monitor Stakeholder Engagement: Key Inputs
Resource Project
Lessons learned management plan communications Stakeholder
register Stakeholder engagement plan
Issue log Risk register
register
Work Communications
performance management
data plan
Change requests
402
Monitor Stakeholder Engagement: Key Tools
and Techniques
Data analysis
Work performance
Decision making information
Project management plan Data representation Change requests
Project documents Communication skills Project management plan
Work performance data updates
Interpersonal and
Project documents
team skills updates
Meetings
403
• For simplicity, all agile concepts related to both the Executing Process Group and the Monitoring and
Controlling Process Group have been collected here.
• When preparing for the exam, be familiar with the following agile project management terms and
concepts.
• Wireframes, storyboards, and protypes
• Fist of fives
• Standup meetings/daily scrums
• Tracking best practices; Information radiators and refrigerators
• Continuous integration, test‐driven development, refactoring
• Backlog grooming
• Product reviews (demonstrations)
• Iteration, release, and product retrospectives
404
Lesson 7 Review: Monitoring and Controlling
Processes
• PMP®/CAPM® Test‐Worthy Topics: • Control Quality (8.3)
Monitoring and Controlling Processes • Control Resources (9.6)
• Monitoring and Controlling Process • Monitor Communications (10.3)
Group Overview
• Monitor and Control Project Work • Monitor Risks (11.7)
(4.5) • Control Procurements (12.3)
• Perform Integrated Change Control • Monitor Stakeholder Engagement
(4.6) (13.4)
• Validate Scope (5.5) • PMP®/CAPM® Practice Questions
• Control Scope (5.6) • What are your questions?
• Control Schedule (6.6)
• Control Costs (7.4)
405
PMP®/CAPM® Practice Questions: Monitoring
and Controlling Processes
the entry Lesson 7: Monitoring and Controlling Processes
Questions.
406
Lesson 8: Closing Processes
Learning Objective: Based on the PMBOK® Guide Sixth Edition Closing
process.
407
407
Lesson 8 Topics: Closing Processes
• PMP®/CAPM® Test‐Worthy Topics: Lesson 8: Closing
Processes
• Closing Process Group Overview
• Close Project or Phase (4.7)
408
Closing Process Group Overview
• Finalizing all work of the project, phase, or contract
• Updating and archiving documentation
• Releasing physical and human resources
• Transitioning information from the project lessons learned log to
the organization’s information repositories
• Writing and filing the final project report
• ***The Closing Process “Group” consists of only a single
process (Close Project or Phase), but the PMBOK® Guide uses
the word “Group,” as organizations may have additional
processes they perform while closing a project phase, project,
or contract.
409
Close Project or Phase Process (PMBOK® Guide 4.7)
• Transitioning project products, services, or results to operations or to the next project
phase
• Performing a variety of required administrative activities.
• Confirming acceptance from relevant • Evaluate key project parameters
stakeholders • Measuring stakeholder satisfaction
• Closing project accounts (e.g., work hours, costs) • Releasing project resources for other
• Archiving information and documents organizational uses
• Creating the project’s final report
• Collecting final lessons learned and transferring them to the organization’s knowledge
repository
• Performing similar activities for procurements (e.g., confirming acceptance of seller’s
deliverables, processing final payments, finalizing open claims, collecting lessons learned,
and archiving procurement)
• An organization must close projects, project phases, and procurements, whether they are
successful or unsuccessful. 410
Close Project or Phase: Key Outputs
Final Report: summarizing the project’s
or phase’s performance on key
parameters like scope, schedule, cost,
quality, and risk. The final report
highlights variances, the root causes and Project documents
associated lessons learned. updates
It also describes the degree to which the
phase’s or project’s result meets planned
objectives and delivers the anticipated
benefits. Close Project or
Phase
In the event of early termination of the
phase or the project, the report would Final product,
also contain reasons for termination, Final report service, or result
lessons learned, and recommendations transition
for the management and use of any
partially completed product, service or
result. 411
Close Project or Phase: Key Inputs
Project Lessons Risk Risk register
Project management plan learned report Project communications
charter Basis of estimates register Quality control Change log
Quality Issue
Milestone list log measurements
reports
Business case Procurement Requirements
Assumption documentation documentation
log Benefits
Accepted management
deliverables plan
Agreements
Final product, service, or result transition
Final report
412
Close Project or Phase: Key Tools and
Techniques
Project charter
Project documents Project documents updates
Accepted deliverables Expert judgment Final product, service, or
Business documents result transition
Data analysis
Agreements Final report
Meetings Organizational process
Procurement
documentation assets updates
Organizational process
assets
413
Lesson 8 Review: Closing Processes
• PMP®/CAPM® Test‐Worthy Topics: Closing Process
• Closing Process Group Overview
• Close Project or Phase
414
PMP®/CAPM® Practice Questions: Closing
Processes
the entry Lesson 8: Closing Processes Questions.
415

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CAPM® Exam

Question Description Example

Select NOT/EXCEPT For this the type of question, you must All the following are areas of

Question Format Description Example

All (or a With this question format, all Which of the following are areas of

Question Format Description Example

Question Format Description Example

Chicken or the Egg With this format, more than one What comes before sequence activities?

Question Description Example

Practice Exams Practice tests help you become familiar with the environment, as well as the

Marking The exam lets you mark questions and return later to review them.

Project 1 Project 2 Project 3 Project 4

The program took 5 years from conception, and included at least 5 projects. From left to right: Mandarin Oriental, Crystals,

Analysis Phase Design Phase Develop Phase

Human Physical / Social &

Manager Manager Manager

Employee Employee Project

Manager Manager Manager

Employee Employee Project Manager

Employee Employee Project Manager

Manager Manager PMO Manager

Project Manager Project Manager Project Manager

Project Team Project Team Project Team

Project Team Project Team Project Team

Employee HR Manager CEO Project Manager Team Member

Project charter Expert Judgement Scope mgt. plan

Scheduling Schedule Schedule

Initiating Planning Executing Monitoring & Closing

Initiating Planning Executing Monitoring & Closing

People Materials Facilities Equipment

IT Finance Paper Test Lab Test Server

Provide Business Analyst Lead Business Finance Manager Project Manager

Develop System IT Technicians IT Manager External IT Analyst Project Manager,

Test System Quality Control Quality Control N/A Project Manager

Idea Encoding Message Decoding Meaning

Risk‐averse Risk‐averse is a mentality of risk avoidance. Selecting the

Risk seeker Risk seeker is a mentality of looking for risk, or worse case,

Scope risks Schedule risks Business risks

1.1 Unclear 2.1 Material 3.1 New

Make or buy Source selection Procurement

Make or buy Source selection Procurement

Initiating Planning Executing Monitoring & Controlling Closing

Design Work Work package Work package Work package

Work package Work package Work package Work package

Work package Work package Work package Work package

Schedule Lessons Activity Risk register Resource

Schedule Lessons Activity

Not enough 2 3 6 Dedicated Project Manager

Risk Response Tool Description Example

Risk Response Tool Description Example

Mitigate is to proactively change the Eliminating outside sources and doing work

Proposal proposals for bigger, an approach, price, and prospective sellers for design,

(RFP) higher priced, customized significant detail about implementation, and training for

approach for the solution that negotiations occur company named Widgets, Inc.

Inform Update Approve or

Cost management Cost baseline Lessons learned

planned schedule and cost actual schedule and cost metrics

Planned Value (PV) The value of the work that should have Total the value of each project