PMP Tutorial

PMP Tutorial This tutorial gives a very high level overview for the PMP certification exam. It does not cover sufficient information to clear the exam. You need to at least know the concepts mentioned in the tutorial to clear the exam. You may use it either as a starting point to get an initial overview, or you may use it as a last minute refresher to ensure you have covered everything. The tutorial is divided into the following topics PMP fundamentals - This chapter covers general information about project management that is not part of nine process areas. Integration - covers the knowledge area of Project Integration Management. Scope - covers the knowledge area of Project Scope Management. Time - covers the knowledge area of Project Time Management. Cost - covers the knowledge area of Project Cost Management. Risk - covers the knowledge area of Project Risk Management. Quality - covers the knowledge area of Project Quality Management. HR - covers the knowledge area of Project HR Management. Communications - covers the knowledge area of Project Communication Management. Procurement - covers the knowledge area of Project Procurement Management. Ethics - covers the PMP's code of ethics. The PMP exam format has the following distribution across the five process groups Project Initiation Project Planning Project Execution Project Project Monitoring Monitoring and and Control Control Project Closure Professio sional re responsibilit lity

11% 23% 27% 21% 9% 9%

Project Fundamentals Every facet of human life is a project. Every little step we take, from the moment we wake up up to the time we settle to sleep, is filled with mini projects. It's then not a stretch to assume that the way we handle actual projects (from work, school, etc.) is reflection of the way we handle the biggest project there is - our existence. That's why it's doubly important to come up with the perfect habit of proper planning and management of projects. This page covers general information about the discipline of project management. 1. 2. 3. 4.

A project project is a temporary temporary endeavor endeavor.. Projects Projects are unique unique and non-rep non-repetitiv etitive. e. Building Building a road is is an example example of a project. The process of building a road takes a finite amount of time, and produces a unique product. Operations on the other hand are repetitive. Delivering mail every day is an example of operation. The character characteristics istics associat associated ed with a project project are - unique unique purpose, purpose, tempor temporary ary in nature, nature, require require resources (often from various domains), should have a primary sponsor and/or customer, and involves uncertainty. Project Project management management is the the application application of of knowledge, knowledge, skills, skills, tools, tools, and technique techniques s to project project activities activities in order to meet project requirements A program program consists consists of a related related group group of projects. projects. Project Projects s are finite finite where as as programs programs are ongoing ongoing and and continuous. Programs may be repetitive and cyclic. In some cases Project Management is a subset of  Program Management. The project manager may report to the program manager in such cases. A project may or may not be a part of a program, but a program will always have projects. A portfolio consists of multiple programs. As an example Building a house may be a project. Building a colony consisting of row of houses is a program. Building a set of colonies to develop a new city can be considered a portfolio.

5. 6.

A subproject is a subset of a project. Subprojects can be subcontracted. Technical or Functional Manager may be in charge of a subproject. Type of organization - This is an important concept to understand for the PMP exam. The type of  organizations in decreasing order of Project Manager's authority are o Projectized o Strong Matrix o Weak Matrix o Functional Project Manager has maximum authority in a Projectized organization and least authority in a Functional organization. In Functional organizations staff is organized based upon their specialty, such as engineering or sales. In these organizations, functional managers are responsible for specialized departments like marketing. In Functional organization, the role of Project Manager is limited. In Projectized organization, PMs have more authority and independence. All the persons in the project team report to the Project Manager. Real situations are a mixture of functional and projectized organizations. These mixed situations are called matrix organizations. Strong matrix organizations have characteristics of projectized organizations. Weak matrix organizations have characteristics of functional organizations.

7. Leadership style varies from autocratic to democratic. Shared leadership involves team members taking

most of the decisions. It encourages team development. 8. Project Management consists of nine Knowledge Areas. These are o Project Integration Management o Project Scope Management o Project Cost Management o Project Time Management o Project Risk Management o Project Quality Management o Project HR Management o Project Communication Management o Project Procurement Management Each Knowledge area has further Processes. There are a total of 42 processes. Each process has inputs, outputs and "tools and techniques" (ITTO). The PMBOK primarily covers each of the processes and it's ITTO in detail. You need to understand the concepts related to each of the input, output and "tools and techniques". 9. Further the discipline of Project Management has five process groups. These are o Initiation o Planning o Execution o Control o Closure

Each process is part of one of these five project phases. It is important to know the process group for  each of the 42 processes. 10. Project Sponsors are primarily involved in funding the project. Tasks performed by project sponsor  include o Provides financial support o Accepts the project during scope verification o May provide key milestone and deliverables due dates o Does not sign the Project Charter. This is done by Senior Management. Tasks performed by the senior management include o o o o

Issues the project charter  Helps organize the work into projects Helps identify risks Approves the final project plan

Stakeholders are all the individuals that are concerned with the project. Stakeholders have vested interest in the outcome of the project. They include project team members, customers, management, and other individuals who get impacted by the project. Stakeholders role includes o Distributed information during the project. o Notified of project plan changes o Are listed in the project team directory. o Become risk owners. 11. At the end of each project phase, reviews against a set of metrics are performed. If the project fails to meet these metrics, the project may not be allowed to continue. These phase end reviews are called Stage gates or Phase exits. 12. Project Life cycle: All projects have four parts in life cycle. These are 1. 2. 3. 4.

Starting the project Organizing and preparing Carrying out the project work Closing the project

2.

At the beginning of the project there is less cost and less demand for resources. Also there is a higher  risk of failure at the beginning of the project. The risk reduces over the life of the project. The stakeholder  influence is maximum at the beginning of the project and reduces over the life of the project. 3. Projects have multiple competing constraints. These are o o o o o o

Scope Quality Schedule Budget Resources Risk

Different stakeholders may give different priority to these constraints. As an example budget may be the most important constraint for the project sponsor. Scope may be imortant for a customer support engineer, and quality may be important for the testing team. A project team has to balance the demand of these constraints. 13. Progressive Elaboration means adding more details in an iterative fashion. Project Management Plan is

developed using progressive elaboration. 14. Project Management Office (PMO) is a group in an organization providing centralized project management services. The exact role of PMO may vary across organizations. PMO may provide services related to project management or may be directly responsible for project management. 15. Enterprise Environmental Factors refer to external factors in the company, that may influence the project. Enterprise Environmental Factors may include cultural factors, political climate, infrastructure and other  external factors within the organization that may impact the project. Enterprise Environmental Factors are input to many planning processes.

Project Integration Management This chapter covers key concepts related to Project Integration Management. 1.

The knowledge area of Project Integration Management consists of the following seven processes Project Integration Processes Process

Project Phase

Key Deliverables

Develop Project Charter

Initiating

Project Charter  

Develop Project Management Plan

Planning

Project Management Plan

Direct and Manage Project Execution Execution

Deliverables

Monitor and Control Project Work

Monitoring and Control Change Requests

Perform Integrated Change Control

Monitoring and Control Change Requests status updates

Close Project or Phase 2.

3.

Closure

Final product

A project charter  o Formally authorizes the project. o Gives the objectives and business case o Identifies the Project Manager. o Generic enough not to change often. o Written by a Manager higher in authority than Project Manager. o Includes name, description, deliverables o A project does not start unless it has a Project charter. The Inputs, Tools and Techniques and Output of Develop Project Charter process are given below. Develop Project Charter process Inputs

Project Statement of work

Tools & Techniques

Expert judgment

Outputs

Project Charter  

Business case Contract Enterprise environmental factors Organizational process assets 4. 5.

During project execution the project team focuses on completing the tasks assigned. The Senior  Management protects the project from changes and loss of resources. The Project Manager integrates all the pieces into the project as a whole. The Inputs, Tools and Techniques, and Outputs of the Develop Project Management Plan process are given in the table below. Develop Project Management Plan process Inputs

Project charter

Tools & Techniques

Expert judgment

Outputs

Project Management Plan

Outputs from planning processes Enterprise environmental factors Organizational process assets 6.

At the end of each phase of a project, a lessons learned document must be prepared. The lessons learned document defines what was done right, wrong etc. It is required to be completed in order for the project to be completed. 7. Project Management Information System (PMIS) is a system that keeps track of status of all the project tasks. It is used to track the status of the project. The exam does not focus on any specific system (for  example Microsoft Project ). 8. Project Management Plan is developed by Project Manager with inputs from the team, stakeholders and management. Project Management Plan development is iterative. A Project Management Plan is bought into, approved, realistic and formal. 9. A Project Management Plan includes o Project Charter  o Budget o Schedule o Resources o Scope Statement o WBS o Responsibility charts/assignments o Management Plans 10. A Project Management Plan consolidates other management plans. These are: A. B. C. D. E. F. G. H. I. J.

Scope management plan Requirement management plan Schedule management plan Cost management plan Quality management plan Process improvement plan Human resource plan Communication management plan Risk management plan Procurement management plan

The Project Management Plan also includes project baselines. These are: K. Schedule baseline L. Cost performance baseline and M. Scope baseline 2. Project baseline refers to the original version of the project management plan. Once the project management plan is baselined, it may only be changed by raising a change request. 3. Progressive Elaboration involves the process of taking a project from concept to detailed design. 4. Kick-off meeting happens after the planning phase and before the project execution. It is typically used to communicate responsibilities of key stakeholders. 5. Direct and Manage Project Execution process includes performing the work defined in the PMP to achieve project goals. The Input, Tools and Techniques and Outputs of this process are given below. Direct and Manage Project Execution process Inputs

Tools & Techniques

Outputs

Project management plan

Expert judgment

Deliverables

Approved change requests

Project management information system

Work performance information

Enterprise Environmental factors

Change requests

Organizational process assets

Project management plan updates Project document updates

6.

Monitor and Control project work process includes tracking and reviewing the progress of the project. The Input, Tools and Techniques and Outputs of this process are given below. Monitor and Control project work process Inputs

Tools & Techniques

Project management plan

Expert judgment

Outputs

Change requests

Performance reports

Project management plan updates

Enterprise environmental factors

Project document updates

Organizational process assets 7.

The change requests that get generated are evaluated as part of the Perform Integrated Change Control process. The change requests on the project deliverables and project artifacts are managed in this process. The Input, Tools and Techniques and Outputs of this process are given below. Perform Integrated Change Control process Inputs

Tools & Techniques

Outputs

Project management plan

Expert judgment

Work performance information

Change control meetings Project management plan updates

Change requests

Change request status updates Project document updates

Enterprise environmental factors Organizational process assets 8. Change Control Board is formed to review change requests. It is used to approve or reject change

requests. After the project scope has been baselined, each requested change must go through a change control review process. 9. Project Manager needs to be proactive in looking for deviations from project plan and then take timely corrective action. After that the Project Manager needs to evaluate the effectiveness of corrective action, and measure performance of corrective action, and then determine the need for further corrective action. 10. When a change request is received, the following steps must be taken (in this order) -

2.

1. Evaluate (assess) the impact of change to the project 2. Create alternatives including cutting other tasks, crashing, fast-tracking etc. 3. Meet with management, sponsors etc. 4. Meet with the customer if necessary The Close Project or Phase is the process of formal completion of all project related activities. The Input, Tools and Techniques and Outputs of this process are given below. Close Project or Phase Inputs

Project management plan

Tools & Techniques

Expert judgment

Outputs

Final product, service or result transition

Accepted deliverables

Organizational process assets updates

Organizational process assets 3.

At the end of each phase of a project, a lessons learned document must be prepared. The lessons learned document defines what was done right, wrong etc. It is required to be completed in order for the project to be completed.

Project Scope Management This chapter covers key concepts related to Project Scope Management. 1.

The knowledge area of Project Scope Management consists of the following processes Scope Management Processes Process

Project Group

Key Deliverables

Collect Requirements planning

Requirements document

Define Scope

planning

project scope statement

Create WBS

planning

WBS, WBS dictionary

Verify Scope

Monitoring and Controlling Acceptance deliverables

Control Scope

Monitoring and Controlling Change Requests

2. The knowledge area of Scope Management includes the processes required to ensure that the project

includes all the work, and only all the work required to complete the project successfully. It is primarily concerned with controlling what is and what is not in the scope. 3. Project Portfolio Management is the process of project selection. It involves making a decision about which project an organization should execute. 4. There are two types of project selection methods. These are o Benefits Measurement o Constrained Optimization 5. Benefits Measurement project selection methods involve comparing the values of one project against another. There are the following type of Benefit Measurement project selection techniques o Murder Boards - This involves a committee asking tough questions from each project o Scoring Models - Different projects are given scores based on certain defined criteria. Project with higher score is selected. o Benefits Cost Ratio - This technique involves computing benefits to cost ratio (BCR) for a project. Project with higher BCR is selected. o Payback period - This technique involves considering how long it takes back to "pay back" the cost of the project. Inflation or interest earned in not considered in this technique. A project with lower pay back period is better. o Discounted Cash Flow - This technique takes into account the interest earned on the money. The Future Value (FV) of projects is compared. FV=PV(1+i)n PV is the present value of the project. A project with higher present value is better. o Internal Rate of Return (IRR) - A project that has higher IRR is better, as it is giving higher  return on money. 6. Constrained Optimization Project selection methods are used for large projects. These are techniques based on mathematical models. The Constrained Optimization techniques are o Linear Programming o Non-Linear Programming o Integer Algorithm o Dynamic Programming o Multi-objective Programming 7. Expected monetary value of a project (or expected value) is equal to probability*impact . So if  probability of a project's success is 20% and revenue earned if successful is $100000, then the net value of the project will be $20,000. A project with higher net value should be selected when performing project selection. 8. Management by Objective (MBO) is a management philosophy with three objectives o Establish unambiguous and realistic objectives o Periodically Evaluate if objectives are being met o Take corrective actions. MBO works only if management supports it.

9.

Collect Requirements process involves documenting stakeholders needs to meet project objectives. The Inputs, Tools and Techniques, and Outputs of Collect Requirements process are given below. Collect Requirements Process Inputs

Project charter

Tools & Techniques

Outputs

Interviews

Requirements documentation

Stakeholder register Focus groups

Requirements management plan

Facilitated workshops

Requirements traceability matrix

Group creativity techniques Questionaires and surveys Observations Prototypes Group decision-making techniques 10. The Define Scope process involves defining detailed description of the project and major deliverables. The Input, Tools and Techniques and Output of the Define Scope process are: Define Scope Process Inputs

Project charter

Tools & Techniques

Expert judgment

Outputs

Project scope statement

Requirements documentation Product analysis

Project document updates

Organizational process assets Alternative identification Facilitated workshops 11. Create WBS is the process of dividing the project deliverables into smaller components. The Inputs, Tools and Techniques and Outputs of Create WBS process are: Create WBS Process Inputs

Project Scope Statement

Tools & Techniques

Decomposition

Outputs

WBS

Requirements documentation

WBS dictionary

Organizational process assets

Scope baseline Project document updates

12. Work Breakdown Structure (WBS) is an important part of the exam. It is a graphical representation of the hierarchy of the project. The WBS template can be reused across projects. WBS forces the project team to think through all the levels of the project. If a task is not in the WBS, then it is not part of the project. 13. 8/80 rule for WBS - No task should be less than 8 hours or more than 80 hours. 14. WBS dictionary explains all the WBS components. Also WBS is input to most of the planning processes. Specifically WBS is input to the following processes o Cost Estimating o Cost Budgeting o Scope control o Activity Definition o Plan Purchases and Acquisitions 15. The Verify Scope is the process in which the project customer formally accepts the project deliverables. Scope Verification happens at the end of each phase. During the Verify Scope process customer gives feedback on work performed. While Verify Scope process focuses on customer acceptance, Perform Quality Control process focuses on correctness of work. 16. The table below gives inputs, Tools & Techniques, and Outputs of the Verify Scope process. Verify Scope Process Inputs

Project management plan

Tools & Techniques

Inspection

Outputs

Accepted Deliverables

Requirements documentation

Change requests

Requirements traceability matrix

Project document updates

Validated deliverables 17. Control Scope process involves monitoring the status of project and managing scope changes. The Inputs, Tools and Techniques and Outputs of Control Scope process are: Control Scope Process Inputs

Tools & Techniques

Outputs

Project management plan

Variance analysis

Work performance measurements

Requirements documentation

Change requests

Requirements traceability matrix

Project management plan updates

Organizational process assets

Organizational process assets updates

Work performance information

Project document updates

Project Time Management This chapter covers key concepts related to Project Time Management. 1.

The knowledge area of Project Time Management consists of the following processes Time Management Processes Process

2.

Project Phase

Key Deliverables

Define Activities

Planning

Activity List, Milestone list

Sequence Activities

Planning

Project Schedule network diagrams

Estimate Activity Resources Planning

Activity resource requirements, Resource breakdown structure

Estimate Activity Durations

Planning

Activity duration estimates

Develop Schedule

Planning

Project Schedule

Control Schedule

Monitoring and Controlling

Work Performance measurements, Change Requests

class="basic" The Define Activities process has the following Inputs, Tools and Techniques and Outputs Define Activities Process Inputs

Tools and Techniques

Scope baseline

Decomposition

Outputs

Activity list

Enterprise environmental factors Rolling wave planning

Activity attributes

Organizational process assets

Milestone list

Templates Expert judgment

3.

The Sequence Activities process has the following Inputs, Tools and Techniques and Outputs Sequence Activities Process Inputs

Tools and Techniques

Outputs

Project scope statement

Precedence diagram method (PDM) or  AON

Project schedule network diagrams

Activity List

Applying leads and lags

Project document updates

Activity attributes

Schedule Network Templates

Milestone list

Dependency determination

Organizational process assets 4.

The Estimate Activity Resources process has the following Inputs, Tools and Techniques and Outputs Estimate Activity Resources Process Inputs

Tools and Techniques

Outputs

Activity List

Expert judgment

Activity resource requirements

Activity attributes

Alternative analysis

Resource breakdown structure

Resource calendars

Published estimating data

Project document updates

Enterprise environmental factors Bottom-up estimating Organizational process assets 5.

Project Management software

The Estimate Activity Durations process has the following Inputs, Tools and Techniques and Outputs Estimate Activity Durations Process Inputs

Tools and Techniques

Outputs

Activity list

Expert judgment

Activity duration estimates

Activity attributes

Analogous estimating

Project document updates

Activity resource requirements

Parametric estimating

Resource calendars

Three-point estimates

Project scope statement

Reserve analysis

Enterprise environmental factors Organizational process assets 6.

The Develop Schedule process has the following Inputs, Tools and Techniques, and OutputsDevelop Schedule Process Inputs

Tools and Techniques

Outputs

Organizational process assets

Schedule network analysis Project Schedule

Project scope statement

Critical path method

Schedule baseline

Activity List

Schedule Compression

Schedule data

Activity attributes

What-if scenario analysis

Project document updates

Project Schedule Network diagram Resource levelling Activity Resource requirements

Critical chain method

Resource Calendars

Scheduling tool

Activity duration estimates

Applying calendars

Project Management Plan Risk Register 

Adjusting Leads and Lags

Enterprise environmental factors 7.

The Control Schedule process has the following Inputs, Tools and Techniques and Outputs Control Schedule Process Inputs

Tools and Techniques

Outputs

Project management plan

Performance reviews

Work performance measurements

Project schedule

Variance analysis

Organizational process assets updates

Work performance information Project management software Change requests Organizational process assets Resource leveling What-if scenario analysis

Project management plan updates Project document updates

Adjusting leads and lags Schedule compression Scheduling tool 8.

Bar charts (or Gantt charts) are used to display tasks and their dates in a graphical fashion. They are used to display information of the type task 1 is scheduled from date A to date B. Typically the date range is displayed in the X-axis and the tasks on the Y-axis. Bar charts do not show task dependencies. They are generally used to track progress and show to the team. 9. Milestone charts are similar to bar charts but display only major events. They display major milestones (for example bridge design completed). They are used to report status to Management. 10. Network diagrams are used to display activities and their dependencies. Network diagrams can be used to perform critical path analysis. Network diagrams can also be used to perform crashing and fast tracking of the project. There are two type of network diagrams o Activities on Node (or Precedence) o Activities on Arrow (or AOA) Precedence is most commonly used. AON and AOA cannot have loops or conditional relationships. 11. An activity in a network diagram is displayed as shown below. Activity name class="basic"Activity Number Estimate 12. As an example Documentation 2

5 days

13. In the above example Documentation is activity number 2 and is estimated to last 5 days. 14. Precedence (or Activity on Node) diagrams can be used to display four type of relationship between activities. These are

o o o o

Finish-To-Start Start-To-Start Start-To-Finish Finish-To-Finish

Finish-to-start relationship means the dependent activity cannot start until the first activity is finished. This is the most common way to represent relationships between activities. 15. Activity on Array (AOA) network diagrams have the following characteristics. o AOA only uses Finish-To-Start relationship between tasks. o PERT and CPM can only be used with AOA. o Dummy events are shown with dotted lines. They do not take any time. They show dependencies between tasks. 16. Longest path through the network diagram is called the critical path. The activities on the critical paths are called critical activities. 17. Lags are inserted waiting times in between tasks. For example Task B cannot start until three days after  task A completes. 18. Slack or Float is the amount of time a task can be delayed without delaying the project. Tasks on the critical path have zero float. 19. Critical Path Method (CPM) has the following characteristics. o It uses one time estimate per activity o It can be drawn only using AOA diagrams o It can have dummy events 20. Program Evaluation and Review Technique (PERT) has the following characteristics. o It uses three estimates per activity - optimistic, pessimistic and most likely o It can be drawn only using AOA diagrams o It can have dummy events 21. PERT utilizes more information than CPM as it considers the "Pessimistic" and "Optimistic" values in addition to the "Most Likely" value in its calculations. The following are formulae used by PERT Mean = (P + 4M + O)/6 Standard Deviation = (P-O)/6 Variance = ((P-O)/6) 2 Here P is the pessimistic estimate, O is the optimistic estimate and M is the most likely estimate. 22. GERT is another type of network diagram. It can support looping. 23. If a project has more than one critical paths then the risk to the project increases. 24. Resource levelling refers to keeping the resources same across the duration of the project.

Project Cost Management This chapter covers key concepts related to Project Cost Management. 1.

The knowledge area of Project Cost Management consists of the following processes Project Cost Processes Process

Estimate Costs

Project Phase

Planning

Determine Budget Planning Control Costs 2. 3.

Key Deliverables

Activity Cost Estimates,Basis of estimates Cost performance baseline

Monitoring and Controlling Work performance measurements

Alternative identification process identifies other solutions to an identified problem. Value Analysis approach is used to find more affordable, less costly methods for accomplishing the same task. 4. The Estimate Costs process takes the following inputs o Scope baseline o Project schedule o Human resource plan o Risk register  o Enterprise environmental factors o Organizational process assets 5. Depreciation is technique used to compute the estimated value of any object after few years. There are three type of depreciation techniques. These are o Straight line depreciation The same amount is deprecated (reduced) from the cost each year.

Double-declining balance - In the first year there is a higher deduction in the value - twice the amount of straight line. Each year after that the deduction is 40% less than the previous year. o Sum of year depreciation - Lets say the life of an object is five years. The total of one to five is fifteen. In first year we deduce 5/15 from the cost, in second year we deduce 4/15, and so on. Analogous Estimating is an estimating technique with the following characteristics o Estimates are based on past projects (historical information) o It is less accurate when compared to bottom-up estimation o It is a top-down approach o It takes less time when compared to bottom-up estimation o It is a form of an expert judgment

o

6.

7. In Parametric Modeling Estimation, you use a mathematical model to make an estimate. It is of two

types. o o

Regression Analysis is a mathematical model based upon historical information. Learning Curve model is based upon the principal that the cost per unit decreases as more work gets completed. 8. Bottom up estimation is same as WBS estimation. It involves estimating each work item and adding the estimates to get the total project estimate. 9. You can expect five to ten questions related to Earned Value Management. These are generally pretty simple once you have good understanding of the concepts, and remember the formulae. These formulae are explained below. 10. Planned Value (PV) refers to what the project should be worth at this point in the schedule. It is also referred as BCWS (Budgeted Cost of Work Scheduled). 11. Earned Value (EV) is the physical work completed to date and the authorized budget for that. It is also referred as BCWP (Budgeted Cost of Work Performed). 12. Actual Cost (AC) is the actual amount of money spent so far. It is also referred as ACWP (Actual Cost of Work Performed). 13. Estimate At Completion (EAC) refers to the estimated total cost of the project at completion. 14. CPI refers to Cost Performance Index. It is defined as CPI = EV/AC If CPI is less than 1, this means that the project is over budget. 15. BAC refers to Budget at Completion. It is related to EAC. EAC = BAC/CPI 16. ETC refers to Estimate to Completion. It is defined as ETC = EAC - AC 17. CV refers to Cost Variance. It is defined as CV = EV - AC 18. SV refers to Schedule Variance. It is defined as SV = EV - PV

Negative cost or schedule variance means that project is behind in cost or schedule. 19. SPI refers to Schedule Performance Index. It is defined as SPI = EV/PV 20. VAC refers to Variance At Completion. It is defined as VAC = BAC - EAC 21. The process of Cost budgeting defines time phased cost estimates for the project. For example, in the first month the project will require $10,000. Cost estimating involves defining cost estimates for tasks. Cost budgeting defines cost estimates across time. 22. The tools and techniques used for Estimate Costs are o Expert judgment o Analogous estimating o Parametric estimating o Bottom-up estimating o Three-point estimates o Reserve analysis o Cost of quality o Project Management estimating software o Vendor bid analysis 23. Cost baseline refers to what is expected to be spent on the project. It is usually an S-curve. That is the expenditure is less in the beginning, and the end. The expenditure is maximum during the middle of the project. 24. The after project costs are called life cycle costs.

Project Quality Management This chapter covers key concepts related to Project Quality Management. 1.

The knowledge area of Project Quality Management consists of the following processes Quality Management Processes Process

Plan Quality

Project Phase

Quality Management Plan, Quality Metrics

Planning

Perform Quality Assurance Execution Perform Quality Control

Key Deliverables

Change Requests

Monitoring and Controlling Quality control measurements

2. The process of Plan Quality includes defining quality requirements of the project and documenting how

the project will ensure compliance. The ITTO of Plan Quality process are given below. Plan Quality Process Inputs

Tools and Techniques

Outputs

Scope baseline

Cost-benefit analysis

Quality management plan

Stakeholder register

Cost of quality

Quality metrics

Cost performance baseline

Control charts

Quality checklists

Schedule baseline

Benchmarking

Process improvement plan

Risk register

Design of experiments

Project document updates

Enterprise environmental factors Stastical sampling Organizational process assets

Flowcharting Proprietary quality management methodology Additional quality planning tools

3.

Grade refers to category or rank given to entities having same functional use but different technical characteristics. As an example, for different grades of hotels, the customers expectations are different. Poor grade may be acceptable, but poor quality is not. 4. The aim of quality is to ensure "Conformance to requirements" and "fitness for use". 5. Quality Policy defines the company goals and how to adhere to them. This acts as an input to Quality Planning for a project. Quality Policy is part of Organizational Process assets. 6. Deming suggested a process of Plan-Do-Check-Act to improve quality. According to Deming, each process should go through these steps to improve the quality. 7. Kaizen Theory - Apply continuous small improvements to reduce costs and ensure consistency. 8. Marginal Analysis - You compare the cost of incremental improvements against the increase in revenue made from quality improvements. Optimal quality is reached when cost of improvements equals the costs to achieve quality. 9. The value of sigma of Normal Distribution are given below. These are important for the exam. Normal Distribution Sigma values Sigma

Percentage covered

One sigma

68.26%

Two sigma

95.46%

Three sigma 99.73% Six sigma

99.99%

10. Based on the above table, we can see that in six sigma one out of 10,000 items can have defects. In three sigma, twenty seven out of 10,000 items can have defects. 11. Giving extras i.e. doing more than the project scope is called gold-plating. PMI does not recommend gold-plating. 12. Quality must be planned in and not inspected in. Prevention is more important than inspection. 13. Quality Assurance is done during execution of the project. It includes o Process of evaluating overall performance on a regular basis o Re-evaluating quality standards o Quality audits - structured review of quality activities that identify lessons learned. These lessons learned are used for process improvement.

Perform Quality Assurance involves reviewing the quality requirements and auditing the results from quality control measurements. Perform Quality Assurance uses data created during Perform Quality Control.

ITTO of Perform Quality Assurance Inputs

Tools and Techniques

Outputs

Project management plan

Plan Quality and Perform Quality Control tools and techniques

Organizational process updates

Quality metrics

Quality audits

Change requests

Work performance information

Process analysis

Project management plan updates

Quality control measurements

Project document updates

14. Perform Quality Control focuses on correctness of work. It includes inspections. The inputs, tools and techniques and outputs (ITTO) used for Perform Quality Control process are ITTO of Perform Quality Control Inputs

Tools and Techniques

Outputs

Project management plan

Cause and effect diagram

Quality control measurements

Quality metrics

Control charts

Validated changes

Quality checklists

Flowcharting

Validated deliverables

Work performance measurements

Histogram

Organizational process assets updates

Approved change requests

Pareto chart

Change requests

Deliverables

Run chart

Project management plan updates

Organizational process assets

Scatter diagram

Project document updates

Statistical Sampling Inspection Approved change requests review 15. In Just-In-Time (JIT) Quality, the amount of inventory is zero. The inputs are made available, just when

they are required. This reduces the storage cost. 16. Rule of seven : In control charts, if there are seven points on one side of mean, then an assignable cause must be found. 17. The process of Analogous Estimation involves looking at the history of past projects, and use them to make estimates.

Project HR Management This chapter covers key concepts related to Project HR Management. 1.

The knowledge area of Project HR Management consists of the following processes HR Management Processes Process

Project Phase

Key Deliverables

Develop Human Resource Plan Planning

Human Resource Plan

Acquire Project Team

Execution

Project Staff assignments

Develop Project Team

Execution

Team performance assessments

Manage Project Team

Execution

Change requests

2.

Develop Human Resource Plan process involves identifying and documenting project roles and responsibilities. The table below gives the inputs, tools and techniques, and Outputs for the Develop Human Resource Plan process Develop Human Resource Plan Process Inputs

3.

Tools and Techniques

Outputs

Enterprise environmental factors

Organization charts and Human resource plan position descriptions

Organizational process assets

Organizational Theory

Activity resource requirements

Networking

Acquire project team process involves identifying and obtaining the team necessary to execute the project. The table below gives the inputs, tools and techniques, and Outputs for the Acquire project team process Acquire project team process Inputs

Tools and Techniques

Project management plan

Pre-assignment

Outputs

Project staff assignments

Enterprise environmental factors Negotiation

Resource calendars

Organizational process assets

Project management plan updates

Acquisition Virtual teams

4.

Develop project team process involves improving the competencies of the team members and improving teamwork between the team. The table below gives the inputs, tools and techniques, and Outputs for the Develop project team process Develop project team process Inputs

Project staff assignment

Tools and Techniques

Interpersonal skills

Project management plan Training Resource calendars

Outputs

Team performance assessments Enterprise environmental factors updates

Team-building activities Ground rules Co-location Recognition and rewards

5. Responsibility Assignment Matrix (RAM) defines who does what. The Staffing Management Plan

6.

7.

defines when will people get added and removed from the project. A Project Manager may yield authority over the project team in one of the following ways o Referent - project team knows the PM o Formal Power - Power due to Project Managers position o Technical Power - Project Manager has strong technical skills in the projects domain. o Coercive Power - The project team is afraid of the power the Project Manager holds. Conflicts in the team are caused due to the following reasons in decreasing order of occurrences. o Schedules o Project Priorities o Resources o Technical Opinions So the most common cause of conflicts in projects are issues related to schedules.

8.

Conflicts are best resolved by those in the team. 9. There are standard conflict resolution techniques available to resolve conflicts. These are (from best to worst) o Problem Solving or Confrontation (look at the facts, analyze them and find a solution). This is an example of win-win situation. o Compromising (Find the middle route). This is an example of loose-loose situation. o Withdrawal or Avoidance o Smoothing (Emphasize the agreements) o Forcing (Do it my way). This is an example of win-loose situation. 10. The process of problem solving has these steps o Define the cause of the problem o Analyze the problem o Identify solution o Implement a decision

o Review the decision, and confirm that the problem is solved. 11. Manage project team process is the process of tracking team member performance and managing issues within the team. The table below gives the inputs, tools and techniques, and Outputs for the Manage project team process Manage project team process Inputs

Tools and Techniques

Outputs

Project staff assignments

Observation and conversation Enterprise environmental factors updates

Project management plan

Project performance appraisals Organizational process assets updates

Team performance assets

Conflict management

Change requests

Performance reports

Issue log

Project management plan updates

Organizational process assets Interpersonal skills 12. War room is a technique for team building. As part of this the project team meets in one room. It helps to

create a project identity. 13. Halo Effect is the assumption that because the person is good at a technology, he will be good as a project manager. 14. There are many organizational theories. Some of the main ones are - Expectancy Theory, McGregory Theory, Herzberg Theory, Maslow's Hierarchy of needs. 15. Expectancy Theory - People accept to be rewarded for their efforts. This is a motivation factor. People put in more efforts because they accept to be rewarded for their efforts. 16. McGregory Theory of X and Y - There are two type of employees. Employees of type X need to be always watched. They cannot be trusted and need to be micro managed. Employees of type Y, on the other hand, are self-motivated. They can work independently. 17. Herzberg Theory - Hygiene factors (salary, cleanliness etc.) if not present can destroy motivation. However good hygiene alone does not improve motivation. What motivates people is the work itself. The motivation factors for employees include responsibility, self-actualization, growth, recognition etc. 18. Maslow's Hierarchy of needs - there are various levels of needs for an employee. When a lower level is met, employee attempts to reach the next higher level. The maximum satisfaction is achieved when the employee reaches the highest level of satisfaction - self-fulfillment. These level of needs from the highest to lowest are o Self-fulfillment o Esteem o Social o Safety o Physiology

Project Communication Management This chapter covers key concepts related to Project Communication Management. 1.

The knowledge area of Project Communication Management consists of the following processes class="basic"Communication Management Processes Process

Process Group

Identify Stakeholders

Initiating

Stakeholders register  

Plan Communications

Planning

Communication Management Plan

Distribute Information

Executing

Organization process assets updates

Manage Stakeholders Expectations Executing Report Performance 2. 3. 4. 5.

Key Deliverables

Change requests

Monitoring and Controlling Performance Reports

Communication Management Plan defines how and when the various stakeholders receive information, and communicate with each other. Memos, emails are examples of non-formal communication. The total number of communication channels between n stakeholders is n(n-1)/2. So if there are ten stakeholders in a project, there are 45 channels of communication. The Identify Stakeholders process involves identifying all persons and organizations that may impact the outcome of project. Project stakeholders may include customers, project team, project sponsor and other  persons involved in the project. During stakeholder analysis the power and interest of the stakeholders is plotted with Interest on X-axis and Power on Y-axis. The Inputs, Tools and Techniques, and Output of  Identify Stakeholders process is given below. Identify Stakeholders

Inputs

Tools & Techniques

Outputs

Project Charter

Stakeholder analysis Stakeholder register  

Procrement documents

Expert judgment

Stakeholder management strategy

Enterprise environmental factors Organizational process assets 6.

Plan Communications process involves determining what kind of information should be shared with which project stakeholder. This is documented in the Communication management plan. Also documented is how and when the communication needs to be shared with stakeholders. The Inputs, Tools and Techniques, and Output of Plan Communications process is given below. Plan Communications Process Inputs

Tools & Techniques

Outputs

Stakeholder register 

Communication requirements analysis

Communications management plan

Stakeholder management strategy

Communication technology

Project document updates

Enterprise environmental factors Communication models Organizational process assets 7.

Communication methods

Throughout the project duration, information is shared with stakeholders as planned. This sharing of  information is part of the Distribute Information process. The Inputs, Tools and Techniques, and Output of Distribute Information process is given below. Distribute Information Inputs

Tools & Techniques

Project management plan

Communication methods

Performance reports

Information distribution tools

Outputs

Organizational process assets updates

Organizational process assets 8.

As part of the Manage Stakeholder Expectations process, the project manager works with the stakeholders, understands and addresses their needs and expectations. The Inputs, Tools and Techniques, and Output of Manage Stakeholder Expectations process is given below. Manage Stakeholder Expectations Process Inputs

Stakeholder register

Tools & Techniques

Outputs

Communication methods Organizational process assets updates

Stakeholder management strategy Interpersonal skills

Change requests

Project management plan

Project management plan updates

Management skills

Issue log

Project document updates

Change log Organizational process assets 9.

The Report Performance process involves sharing the project status reports and measurements with appropriate stakeholders. Report Performance Process Inputs

Tools & Techniques

Outputs

Project Management Plan

Variance analysis

Performance reports

Work performance information

Forecasting methods

Organizational process assets updates

Work performance measurements Communication methods Change requests Budget forecasts

Reporting systems

Organizational process assets

Project Risk Management This chapter covers key concepts related to Project Risk Management. 1.

The knowledge area of Project Risk Management consists of the following processes -

Risk Management Processes Process

2. 3.

Project Phase

Key Deliverables

Plan Risk Management

Planning

Risk Management Plan

Identify Risks

Planning

Risk register  

Perform Qualitative Risk Analysis

Planning

Risk register updates

Perform Quantitative Risk Analysis Planning

Risk register updates

Plan Risk Responses

Planning

Risk related contract decisions

Monitor and Control Risks

Monitoring and Controlling Risk register updates

A project risk is a potential source of deviation from the project plan. Project risks can have a negative or  positive impact on the project. Project risks that are negative are called threats. Project risks that are positive are called opportunities. Responses to threat include -o Reducing the probability of risk o Developing contingency plans o Passively accepting consequences. o Transferring risk Insurance is an example of transferring risk.

4. 5.

Non-critical risks should be documented. They should be revisited and reviewed regularly. Risks are identified in all phases. 6. Work-around refers to how to handle risks that have occurred but are not part of risk response plan. This happens in risk monitoring and control phase. 7. Delphi technique is most commonly used to obtain expert opinions on technical issues. It can be used to get inputs on Scope, Estimates or Risks. Some characteristics of the Delphi technique are o The experts identities are anonymous. They are not in the same room. o The PM tries to build a consensus among the experts.

Project Procurement Management This chapter covers key concepts related to Project Procurement Management. 1.

Procurement Management involves getting work done by people outside the project team. Project Procurement Management includes administering contracts and change control process to manage contracts or purchase orders. The knowledge area of Project Procurement Management consists of the following processes Procurement Management Processes Process

Project Phase

Key Deliverables

Plan Procurements

Planning

Procurement Management Plan

Conduct Procurements

Execution

Selected Sellers, Procurement contract award

Administer Procurements Monitoring and Controlling Change requests Close Procurements 2.

Closure

Closed procurements

The Plan Procurement process involves build versus buy decisions. The Inputs, Tools and Techniques, and Outputs of Plan Procurement process are listed in the table below. Plan Procurement process Inputs

Tools and Techniques

Outputs

Scope baseline

Make-or-buy analysis

Procurement management plan

Requirements documentation

Expert judgment

Procurement statements of work

Teaming agreements

Contract types

Make-or-buy decisions

Risk register

Procurement documents

Risk-related contract decisions

Source selection criteria

Activity resource requirements

Change requests

Project schedule Activity cost estimates Cost performance baseline

Enterprise environmental factors Organizational process assets 3. 4.

A contract is a formal agreement. It is a legal document biding to both seller and buyer. Changes to contract must be in writing and formally controlled. Most Governments back all contracts by providing a court system. The process of Conduct Procurement involves receiving seller responses, selecting a seller, and awarding a contract. During this process bids or proposals from sellers are evaluated, and one or more seller is selected to execute the work. Conduct Procurement process Inputs

Tools and Techniques

Outputs

Project Management Plan

Bidder conferences

Selected sellers

Procurement documents

Proposal evaluation techniques Procurement contract award

Source Selection criteria

Independent estimates

Resource calendars

Qualified seller list

Expert judgment

Change requests

Seller proposals

Advertising

Project management plan updates

Project documents

Internet search

Project document updates

Make-or-buy decisions

Procurement negotiations

Teaming agreements Organizational process assets 5. Sole Source refers to a market condition in which only one qualified seller exists in the market. Single Source refers to a market condition in which the company prefers to contract with only one seller. Oligopoly refers to a market condition where very few sellers exist, and the action of one seller will have

6. 7.

impact on other seller prizes. Bidder conferences are meetings between buyer and sellers before the bid is submitted. The conference is used by buyers to provide consistent information to all sellers. The process of Administer Procurement involves managing procurement relationships and ensuring the seller performance meets the procurement requirements. Administer Procurement process Inputs

Tools and Techniques

Outputs

Procurement documents

Contract change control system

Procurement documentation

Project management plan

Procurement performance reviews Organizational assets updates

Contract

Inspection and audits

Change requests

Performance reports

Performance reporting

Project management plan updates

Approved change requests

Payment systems

Work performance information Claims administration Records management system 8. 9.

10. 11. 12.

Contract can be used as a risk management tool, as in transferring risk. Centralized Contracting refers to a separate contracting office that handles contracts for all projects. In De-centralized Contracting a contract administrator is assigned for each project. Force majeure is a powerful and unexpected event, such as hurricane or other disaster. Privity is contractual information between customer and vendor. The process of Close Procurement involves completing each procurement. The process involves verifying that all planned work as per the contract has been completed. Close Procurement process Inputs

Tools and Techniques

Project management plan

Procurement audits

Procurement documentation Negotiated settlements

Outputs

Closed procurements Organizational process updates

Records management system

Code of Professional Ethics This chapter covers PMI's code of Professional Conduct. The PMP code of Professional Conduct is defined at http://www.pmi.org/PDF/AP_PMICodeofEthics.pdf 

1. Culture Shock refers to the initial disorientation that a person first experiences when visiting a country

other than his own. 2. Ethnocentrism is a typical belief that one's culture is superior to the foreigner's culture. 3. PMP's Code of Professional Conduct is a document provided by PMI. It is a guide to Project Managers on how to conduct as a professional. 4. PMP aspirants need to provide accurate and truthful information through out the application process. Any violations can lead to disciplinary action. 5. If a project team member or the project manager has a conflict of interest, then it must be brought into notice of all the stake-holders, to prevent any appearance of improperiety. As an example of this consider a case where a Project Manager is evaluating some vendors. Lets assume the Project Manager  has friendship with one of the vendors. In such a situation, the Project Manager should let all the stakeholders know, and offer herself to be excluded out of the evaluation process. 6. The confidentiality of any intellectual property information that a PMP professional works with, must be maintained. 7. Any information that a PMP provides to general public must be accurate and truthful. 8. A PMP must not accept any form of inappropriate gifts. Similarly a PMP must not offer inappropriate compensation for personal gains.