Plan Risk Management is one of the 42 project management processes described in the fourth edition PMBOK®. It’s one of the six Risk knowledge area processes, and one of the twenty Planning processes. The purpose of this process is to develop the Risk Management Plan which lays the foundation for the other risk processes on how risk activities will be performed for the project. The Project Scope Statement is referenced to better understand the project and its deliverables as every project has a unique set of risks. A project that involves unchartered territory will have more unknowns involved than a more routine project based on a history of similar projects. Understanding the contingencies in place for risks affecting the budget and schedule can be accomplished through examining the Cost Management Plan and the Schedule Management Plan. Knowing with whom to discuss project risks and responses may be found in the Communications Management Plan (from the Plan Communications process). Interestingly, Planning Meetings and Analysis is the only tool and technique of this process. This demonstrates that planning for risk management essentially is determined by a group of stakeholders discussing and deciding what is best for the particular project at hand. The result of these discussions is the only output of Plan Risk Management—the Risk Management Plan which describes what risk activities will be performed and how they will be performed throughout the project.
March 26, 2009
March 24, 2009
Plan Communications Process
Plan Communications is one of the 42 project management processes described in the fourth edition PMBOK®. It’s one of the five Communications knowledge area processes, and one of the twenty Planning processes. The purpose of this process is to create the Communications Management Plan based on the communication needs of the stakeholders. It must be documented who should receive what information, how often, in what format, and from whom. Information about the key stakeholders can be found in the Stakeholder Register and Stakeholder Management Strategy (both documents are from the Identify Stakeholders process). This is the starting place for performing Communication Requirements Analysis, which is the identification of the unique communication needs of the various stakeholders. In developing the Communications Management Plan, one needs to know what type of communication technology is available (phone, email, video-conferencing, etc.) and should have knowledge of Communication Models and Communication Methods. The primary output of the Plan Communications process is the Communications Management Plan, which becomes part of the overall Project Management Plan. This document can contain much information depending on the size and formality of the project, including stakeholder communication requirements, what information should be communicated and why, who is responsible for communications, when communications should occur, the time and budget allowed for communication activities, communication constraints, and information flowcharts.
Please also see the related, earlier posts of Identify Stakeholders Process (posted February 19, 2009) which is a predecessor to this process, and PMP Exam – Communication Formula (posted February 3, 2009), which is part of performing Communication Requirements Analysis.
Develop Human Resource Plan Process
Develop Human Resource Plan is one of the 42 project management processes described in the fourth edition PMBOK®. It’s one of the four Human Resource knowledge area processes, and one of the twenty Planning processes. The purpose of this process is to create the Human Resource Plan. The Activity Resource Requirements document (from the Estimate Activity Resources process) is needed as a reference for knowing what human resources are needed for the project. To document the roles and responsibilities in the Human Resource Plan, the organization’s Organizational Charts and Position Descriptions are used, which outline reporting relationships. Networking in order to know more people, and to know people better is especially helpful at the beginning of the project when people are being selected for the team. Having an understanding of how people work together and are motivated is also helpful in putting together a good team, and this is called Organizational Theory.
The Human Resource Plan contains the roles and responsibilities of those involved in the project, organization charts outlining reporting relationships specific to the project, and the staffing management plan. There is much information contained in the staffing management plan, including a description of how staff will be acquired and released, resource calendars, training needs, how safety and compliance issues will be addressed, and how rewards will be given to team members.
March 23, 2009
Cost of Quality
How much should be invested in quality efforts? Cost of Quality is a tool and technique of the fourth edition PMBOK®’s Plan Quality process. These are the expenses associated with the investment to make a quality product and the costs of failing to meet quality standards. Cost of Quality is broken down into these two major categories which are called the Cost of Conformance and the Cost of Nonconformance. The Cost of Conformance may be further broken down into Prevention Costs and Appraisal Costs. Prevention Costs represent the investment of keeping the defects from happening at all. This could include extra training for staff members and sophisticated equipment that accurately assembles a product. Appraisal Costs are the expenses of checking the product in order to find any defects that may have occurred. This could include visually inspecting the product, turning the product on to see if it works, and using equipment that detects products that are not within the set parameters. The Cost of Nonconformance may also be broken down into two categories—Internal Failure Costs and External Failure Costs. If a defective product is discovered in-house before being sent to the customer, the costs of scrapping or re-doing the product are Internal Failure Costs. If the product is sold to the customer, the costs of handling returns, complaints, lawsuits, and lost business are called External Failure Costs.
March 20, 2009
Leads and Lags
Applying Leads and Lags is a tool and technique of the fourth edition PMBOK®’s Sequence Activities process; and Adjusting Leads and Lags is a tool and technique of the Control Schedule process. In order to manage a project schedule, a project manager should understand the simple concepts of leads and lags. Leads and lags are sometimes needed in order to more accurately describe the relationship among project activities. For example, the relationship between two project activities may be that one is the predecessor (it needs to be done before the successor activity) and the other activity is the successor (it occurs after the predecessor). If one activity is mixing cake ingredients and the other activity is placing the cake batter in the oven, then the relationship between these two activities is that mixing cake ingredients is the predecessor and placing the cake batter in the oven is the successor.
A lead allows the successor activity to begin more quickly, and a lag means there is a delay before the successor activity may begin. For example, the activity of turning the oven on may take less than 1 minute, and the successor activity of placing the cake batter in the oven may take less than 1 minute. The schedule would be flawed, however, if only a couple minutes were allowed for completing both turning on the oven and placing the cake batter in the oven. This is because there is a lag of the time it takes for the oven to heat to the desired temperature. We may need to add a lag of 15 minutes to account for the oven heating before we can place the cake batter inside the oven. However, even though the oven is not done heating, we could be mixing cake ingredients while it is heating, which gives us some lead time (the ability to start on this activity sooner).
March 19, 2009
Plan Quality Process
Plan Quality is one of the 42 project management processes described in the fourth edition PMBOK®. It’s one of the three Quality area processes, and one of the twenty Planning processes—which should not be difficult to remember with its name. The purpose of this process is to decide what quality requirements and standards should apply to the project and develop a plan (Quality Management Plan) to assure compliance with them. The Scope Baseline includes acceptance criteria for the project which is especially useful in the development of the Quality Management Plan.
The quality processes contain many tools and techniques. In fact, after listing Cost-Benefit Analysis, Cost of Quality, Control Charts, Benchmarking, Design of Experiments, Statistical Sampling, Flowcharting, and Proprietary Quality Management Methodologies as tools and techniques of this process, “Additional Quality Planning Tools” is listed. See earlier posting of Control Chart (posted February 17, 2009). The Cost of Quality technique examines costs of conformance (prevention and appraisal costs) and nonconformance (internal and external failure costs). The primary output of this process is the Quality Management Plan, which describes how the conformance to the selected quality standards will occur. The Quality Management Plan is then used to guide the other two quality processes—Perform Quality Assurance and Perform Quality Control.
March 13, 2009
Determine Budget Process
Determine Budget is one of the 42 project management processes described in the fourth edition PMBOK®. It’s one of the three Cost knowledge area processes, and one of the twenty Planning processes. The purpose of this process is to add up the estimated costs of the project activities in order to create the budget. These cost estimates and their explanations are found in Activity Cost Estimates and Basis of Estimates, which were outputs of the Estimate Costs process. Cost Aggregation is the fancy term for simply adding up these estimated costs. Additionally, there are a few other documents that are good to reference when developing the budget—the Scope Baseline, Project Schedule, Resource Calendars, and Contracts. The Scope Baseline should be referenced for mention of funding constraints. Assuring that the budget is within these funding constraints is called Funding Limit Aggregation. The Project Schedule and Resource Calendars are used as a basis for knowing how much to budget for different calendar periods of the project. For example, costs may be low for the first couple months, but according to the calendar, in the third month a substantial amount of material may need to be purchased and specialized labor hired, so more funds will be budgeted for that time. Contracts associated with the project should also be examined for agreed-upon costs.
While developing the budget, having some information available on relevant past costs is called Historical Relationships, and taking advantage of someone’s expertise in the area is called Expert Judgment.
The major outputs of Determine Budget are the Cost Performance Baseline and Project Funding Requirements. The Cost Performance Baseline is usually a graph illustrating the budget over the length of time of the project. It does not include reserves which are funds set aside in case they are needed. Please see the earlier posting of Reserve Analysis (posted February 11, 2009). Project Funding Requirements, however, includes the cost baseline in addition to any reserves.
March 12, 2009
Estimate Costs Process
Estimate Costs is one of the 42 project management processes described in the fourth edition PMBOK®. It’s one of the three Cost knowledge area processes, and one of the twenty Planning processes. The purpose of this process is to estimate how much money will be needed for the project activities. Although the purpose is straightforward, this process has more inputs, tools, and outputs than most—6 inputs, 9 tools and techniques and 3 outputs. It’s difficult to accurately estimate costs, especially at the beginning of a project, so these estimates are refined during the course of the project. Estimates at the beginning of a project could be over or under by 50% (called the rough order of magnitude), whereas later on the estimates may be within 10% of the actual costs.
The Human Resource Plan (from the Develop Human Resource Plan process) is used as a reference to help estimate costs associated with paying the people who are working on the project. The Scope Baseline (from the Create WBS process) contains information on the budget constraints in addition to the project activities and their inter-relationships. Like the Scope Baseline, the Project Schedule (from the Develop Schedule process) contains a large amount of information related to the needed resources and activity durations. Mitigation costs should also be calculated using the Risk Register (from the Identify Risks process) as a guide.
As mentioned, there are many tools that can be employed when estimating costs. When vendors are involved, there may need to be an overall analysis of what the project should cost. The costs of quality should also be considered. To read more about the tools of this process, please see earlier postings on TAPUniversity’s blog: PMP Exam – Cost Estimating Tools and Techniques (posted February 4, 2009), PMP Exam – PERT Formula (posted February 6, 2009) which is a weighted three-point estimating formula; and Reserve Analysis (posted February 11, 2009).
The major outputs of Estimate Costs are Activity Cost Estimates and Basis of Estimates. The Activity Cost Estimates are the actual estimates of expenses, and the Basis of Estimates is the supporting detail, such as the assumptions used for a particular estimate.
March 10, 2009
Develop Schedule Process
Develop Schedule is one of the 42 project management processes described in the fourth edition PMBOK®. It’s one of the six Time knowledge area processes, and one of the twenty Planning processes. The purpose of this particularly important process is to create the project schedule. This is the most important Time process, and there are more inputs and tools for the Develop Schedule process than any other Time process. The four Time processes that occur beforehand (Define Activities, Sequence Activities, Estimate Activity Resources, and Estimate Activity Durations) all contribute information that is needed to create the schedule, and the process that begins after the schedule is made (Control Schedule) monitors whether the project is on track with the schedule. In addition to the Project Scope Statement and Resource Calendars being inputs, the Time processes provide the inputs of Activity List and Activity Attributes (from Define Activities), Project Schedule Network Diagrams (from Sequence Activities), Activity Resource Requirements (from Estimate Activity Resources), and Activity Duration Estimates (from Estimate Activity Durations).
The Develop Schedule process takes all this information from these inputs concerning the activities, their needed durations and resources, and their dependencies among each other, and creates the Project Schedule. This is not a simple process. In fact, PMI (Project Management Institute) even offers a credential for scheduling professionals, the PMI-SP. Software is frequently used to make schedule creation easier, which is this process’s tool of Scheduling Tool. Leads and lags are determined, which is accounting for lead time before an activity and lag time after an activity. The Critical Path Method and Critical Chain method are two common methods of organizing individual project activities into a complete schedule. If the schedule must be compressed, there are the options of crashing (adding some type of resources) and fast-tracking (performing tasks in parallel). Of course, the primary output of this process is the Project Schedule.
March 9, 2009
Estimate Activity Durations Process
Estimate Activity Durations is one of the 42 project management processes outlined in the fourth edition PMBOK®. It’s categorized as one of the six Time knowledge area processes, and one of the twenty Planning processes. The purpose of this process is straightforward—it estimates how long the individual project activities will take. We first need a list and information about these activities, which is in the form of the Activity List and Activity Attributes documents (outputs of the Define Activities process). We also should know the resource requirements, which is in the form of the Activity Resource Requirements document (an output of the Estimate Activity Resources process), and we must know how much time people have to work and when they are available, and this is in the form of the Resource Calendars (an output of the Acquire Project Team process). Estimate Activity Durations lists four different ways to actually estimate how long an activity will take—Expert Judgment, Analogous Estimating, Parametric Estimating, and Three-Point Estimating. Also, the tool of Reserve Analysis may be used to add a little time into your estimates as a safety, so that the entire project will not be behind schedule if some activities take longer than planned. To read more about these tools, please see earlier postings on TAPUniversity’s blog: PMP Exam – PERT Formula (posted February 6, 2009) which is a weighted three-point estimating formula; Reserve Analysis (posted February 11, 2009); and PMP Exam – Cost Estimating Tools and Techniques (posted February 4, 2009). The primary output of Estimate Activity Durations is the Activity Duration Estimates, which is then used to develop the project schedule in the Develop Schedule process.
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