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Managing Cost-Reimbursement Contracts
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PMP Exam Power Prep Slides and Practice Exams ®
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PMP® Exam Power Prep Slides and Practice Exams PMC:DJ4:EN:000 ver.3.0
© Copyright CMF Solutions and TwentyEighty Strategy Execution October 2015 All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior written permission of CMF Solutions and ESI International. All material from A Guide to the Project Management Body of Knowledge (PMBOK® Guide) is reprinted with permission of the Project Management Institute, Four Campus Boulevard, Newtown Square, Pennsylvania 19073-3299, USA, a worldwide organization for advancing the state-of-the-art in project management. Phone: (610) 356-4600; Fax: (610) 356-4647. PMI did not participate in the development of this publication and has not reviewed the content for accuracy. PMI does not endorse or otherwise sponsor this publication and makes no warranty, guarantee, or representation, expressed or implied, as to its accuracy or content. PMI does not have any financial interest in this publication and has not contributed any financial resources. PMI, PMP, and PMBOK are registered marks of the Project Management Institute, Inc.
Unit 1
INTRODUCTION
PMI, PMP, and PMBOK are registered marks of the Project Management Institute, Inc.
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Unit 1
INTRODUCTION • Course Concept and Guidelines • Key Materials • Agenda • Exam Structure and Test-Taking Tips
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Unit 1
Course Concept (Reference Manual p. 1-1)
• Reduces and structures required study time: - Targets testable material - Filters out non-testable information
• Provides a comprehensive review of testable topics: - Opportunity for personal Q & A - Practice exams taken and reviewed - Take the test sooner (within days), if desired - Approximately 95% first time pass rate
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Unit 1
Key Materials (Reference Manual p. 1-1)
• PMBOK® Guide, 5th edition, 2013 • Reference Manual: - Chapter on each testable topic - Drill practice (at the end of each chapter) - Summary of Processes (Unit 14) - Exercises (Unit 15)
• Course Slides • Practice Exams • Formula and Process Guide
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Unit 1
Typical Daily Agenda: 5-day Boot Camp (Reference Manual p. 1-1)
Lecture and Review: Mon:
Introduction, PMI Concepts, Processes, Integration, Scope
Tue:
Time
Wed:
Cost, Quality
Thu:
Human Resource, Communication, Risk
Fri:
Procurement, Stakeholder
Facilitated Study, Review, and Practice Exams: 1. Review reference manual and PMBOK® Guide for that day 2. Engage in group study and exercises, as appropriate 3. Review the drill practice topics for that day 4. Take the practice exams (approximately 3 times total) 1-5
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Unit 1
Course Guidelines (Reference Manual p. 1-2)
• Beware personal experience and “real world” • Slow the instructor down: - Taking notes - Asking questions
• Normal meeting etiquette: - Cell phones - Conversations
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Unit 1
The Exam (Reference Manual p. 1-3)
• Computerized at Prometric (Sylvan Learning Center) • Multiple choice (200 questions, 4 choices) • 4 hours: wordy questions / read ? first • Passing score:
66% is a safe guide for passing score!!!
- 25 “pre-test” or control questions; do not count in score - Need 106 of remaining 175 (approx. 61%) - Beware: if all 25 control questions correct but only 105 of the others; your score is 65% (130/200) but you failed by one question!!
• Test bank, random selection (more diverse than ever) • Questions jump from topic to topic (no defined sections) • No penalty for guessing (answer all questions) 1-7
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Unit 1
Test-Taking Tips and Strategies (Reference Manual pp. 1-3 to 1-5)
• The day before: normal sleep, dining, beverages • You may not bring any personal item to the workstation Top of locker • Do the computer tutorial at the test site: - Approximately 15 minutes (does not count against your 4 hours) - 4 hour timer begins immediately upon completion of tutorial - Brain dump formula list: see page 1-7, Reference Manual - Calm down (adrenaline will be pumping at first)
• Answer from PMI perspective and not your own experience (you will not always agree with PMI) • Read carefully; find the pace that works for YOU (not too fast) 1-8
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Unit 1
Processes, Inputs, Tools, Outputs • Many questions depend on your knowledge of inputs, tools, and outputs • Use the tables and exercises provided (Units 14 & 15) • Know the sequence of the processes in a knowledge area • Examine the following summary of trends and patterns Information
Typical Inputs Documents OPA Plans EEF
Actions
Typical Tools Judgment Analysis Meetings & methodologies Estimating Systems
Outcomes
Typical Outputs Documents Updates Change requests
EEF = Enterprise Environmental Factors OPA = Organizational Process Assets 1-9
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Unit 1
Preparing for the Math (Reference Manual p. 1-7)
• Testable math formulas are listed in the following 2 places: • Reference Manual, page 1-7 • Formula and Process Guide (color coded handout)
• There are approximately 39 formulas that have actually been tested. • Every formula will be taught at the appropriate time. • All formulas are tested in the practice exams. • There is also a “Math for the PMP Exam” guide for extra practice with the math. It appears in Unit 15-Exercises.
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Unit 2
PMI CONCEPTS
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Unit 2
PMI CONCEPTS • PMBOK® Guide, Chapter 1: Introduction • PMBOK® Guide, Chapter 2: Organizational Influences and Project Life Cycle • Appendix I: PMI® Code of Ethics and Professional Conduct • Appendix II: International Project Management
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Unit 2
First Two Chapters of the PMBOK® Guide • The first 2 PMBOK chapters are not so-called “knowledge areas;” however, they do contain testable material. • Chapter 1, Introduction, describes foundational ideas and defines key terms. • Chapter 2, Organizational Influences and Project Life Cycle, addresses : • Various organizational structures • The vital role of key stakeholders • Typical project life cycle
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Unit 2
PMBOK® Guide, Chapter 1: Introduction (Major Topics)
• PMI® Code of Ethics and Professional Conduct • Definitions of project and project management • Project constraints • Program and program management • Portfolios, Organizational Project Management, Governance • Project management office (PMO) • Role of the project manager
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Unit 2
PMI® Code of Ethics and Professional Conduct (Reference Manual pp. 2-1 & 2-13 to 2-17, PMBOK® Guide p. 2)
• The code of ethics rests on 4 standards of conduct: • Responsibility • Respect • Fairness • Honesty
• This material is no longer tested as much as it once was. • In-class coverage of the next 4 slides is optional.
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Unit 2
First Key Value: Responsibility (Reference Manual pp. 2-1, 2-14, PMBOK® Guide p. 2)
• Make decisions based on the best interests of society, public safety, and the environment • Only accept assignments you are qualified for • Report unethical or illegal conduct to management (never hide bad news) • Report ethics violations to PMI and cooperate in the collection of information • File ethics complaints only when substantiated by facts • Know and uphold all laws and regulations that govern your work
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Unit 2
Second Key Value: Respect (Reference Manual pp. 2-1, 2-15, PMBOK® Guide p. 2)
• Listen to others; respect the norms and customs of others • Respect the physical and intellectual property rights of others • Be professional even if it is not reciprocated • Do not use power for personal gain • Work directly with others when a conflict exists “Escalation” • Negotiate in good faith • Do not act in an abusive manner toward others
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Unit 2
Third Key Value: Fairness (Reference Manual pp. 2-1, 2-16, PMBOK® Guide p. 2)
• Be transparent, impartial, and objective when making decisions • Never discriminate; make opportunities equally available • Hiring • Procurement
• Disclose real or potential conflicts of interest • “Competing loyalties”
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Unit 2
Fourth Key Value: Honesty (Reference Manual pp. 2-1, 2-17, PMBOK® Guide p. 2)
• Never make misleading or false statements • Never state a half-truth or provide information out of context • Provide accurate information in a timely manner • Make commitments and promises in good faith • Do not mislead others for personal gain • Make others feel safe to tell the truth
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Unit 2
Project and Project Management (Reference Manual pp. 2-1 & 2, PMBOK® Guide pp. 3 and 5-6)
• Project: A temporary endeavor undertaken to create a unique product, service, or result •
Temporary: the project has a defined start and finish
•
Unique: the product or service is different in a distinguishable way
•
In contrast, operations are “on-going and repetitive”
• Project Management: The application of knowledge, skills, tools, and techniques to project activities to meet project requirements
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Unit 2
Project Constraints (Reference Manual p. 2-2, PMBOK® Guide p. 6)
Cost
Schedule Scope
• Cost, schedule, and scope are called the triple constraint • Project success is often measured against the triple constraint • A change in one factor is likely to affect other factors Other Constraints (must also be balanced with triple constraint): • Quality • Resources • Risk 2-11
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Unit 2
Program and Program Management (Reference Manual pp. 2-2 & 3, PMBOK® Guide p. 9)
• Program: A group of projects managed in a coordinated way to obtain benefits not available from managing them individually •
Programs are larger in scope than projects
•
It is not as clear when a program should end
•
Programs have elements of on-going, cyclical operations
• Program Management: Activities applied to a program to meet program requirements and obtain benefits not available by managing the projects individually
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•
Programs always contain related projects
•
However, projects may exist separately from programs
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Unit 2
Portfolio and OPM (Reference Manual p. 2-3, PMBOK® Guide pp. 4-10)
• Portfolio: A collection of projects, programs, and operations managed as a group to achieve strategic business objectives •
One outcome of portfolio management would be the selection and initiation of a new project or program
•
New projects and programs should always align with strategic objectives
• OPM (Organizational Project Management): The overall strategy framework for pursuing organizational goals and objectives •
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Projects, programs, and portfolios exist within this framework
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Unit 2
Organizational Governance (Reference Manual p. 2-3, PMBOK® Guide pp. 14-15)
• Organizational Governance: A high level of oversight and direction
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Board of Directors or Board of Regents at a university
•
Ensures value is added to the organization before approving new projects or programs
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Unit 2
Project Management Office (PMO) (Reference Manual pp. 2-3 & 4, PMBOK® Guide pp. 10-12)
• PMO: Used to establish and coordinate the use of standard methodologies and tools for managing projects •
May operate with differing levels of control:
1. Supportive PMO: Consults and suggests best practices. PMO control is low. 2. Controlling PMO: Empowered to require compliance with standard methodologies. PMO control is moderate. 3. Directive PMO: Takes control of projects by directly managing them. PMO control is high.
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Unit 2
Role of the Project Manager (PM) (Reference Manual p. 2-4, PMBOK® Guide pp. 16-18)
• The PM is a critical link between the project team and the rest of the organization • The PM must possess certain interpersonal skills (PLINCM) • The unit on HR will address this topic in detail
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Unit 2
PMBOK® Guide, Chapter 2: Organizational Influences and Project Life Cycle
• Organizational structures • Organizational process assets (OPA) • Enterprise environmental factors (EEF) • Stakeholders • Project team and other key project roles • Project life cycle
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Unit 2
Organizational Structures • Three classic organizational structures have been tested: • Functional • Matrix • Projectized
• A table in the Reference Manual, p. 2-6, describes advantages and disadvantages of each approach.
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Unit 2
Organizing for Projects: Functional Management (Reference Manual pp. 2-4 & 2-5, PMBOK® Guide pp. 21-26)
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Unit 2
Organizing for Projects: Matrix Management (Reference Manual pp. 2-5 & 2-6, PMBOK® Guide pp. 21-26)
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Unit 2
The Dedicated Project Team: “Projectized” (Reference Manual p. 2-6, PMBOK® Guide pp. 21-26)
Project Manager (high to almost total authority)
Engineers
Production Other project staff
Info Technology
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Unit 2
Summary of Organizational Structures Type of Structure
PM Authority
Functional: 1) PM (Working Level) 2) PE (PM from VP staff) 3) PC (PM from CEO staff)
Little to None Little Little
Matrix: 4) Weak 5) Balanced 6) Strong
Limited Low to Moderate Moderate to High
Dedicated Team: 7) Projectized
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Unit 2
Organizational Process Assets (OPA) (Reference Manual pp. 2-7 & 8, PMBOK® Guide pp. 27-28)
• OPA includes existing organizational processes, procedures, policies, and knowledge bases • PMI has divided OPA into 2 categories: • Standard processes and procedures (may have been developed by PMO) • Knowledge base
• OPA is an explicitly listed input to 38 of 47 processes
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Unit 2
OPA Standard Processes (Reference Manual p. 2-7 , PMBOK® Guide pp. 27-28)
• OPA includes any standard process for how to do things • Examples include: • Safety, ethics, quality control • Risk management and WBS • Change control and work authorization procedures • Procurement procedures • Financial controls • Project closure
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Unit 2
OPA Knowledge Base (Reference Manual p. 2-8, PMBOK® Guide pp. 27-28)
• OPA also includes an organizational knowledge base • The knowledge base would provide storage and allow retrieval of the following types of information: • Historical files from similar, previous projects • Lessons learned databases • Process measurement databases • Defect management databases • Configuration management knowledge base • Financial databases
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Unit 2
Enterprise Environmental Factors (EEF) (Reference Manual p. 2-8, PMBOK® Guide p. 29)
• Factors that may influence the chances for project success • The following 13 examples are identified by PMI: 1. Organizational structure 2. Geographic distribution of facilities and resources 3. Government or industry standards that govern your work 4. Existing infrastructure (facilities and equipment) 5. Existing human resources (skill sets)
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Unit 2
Enterprise Environmental Factors (EEF) (Reference Manual p. 2-8, PMBOK® Guide p. 29)
• 13 examples of EEF continued: 6. Personnel system (staffing, performance reviews, etc.) 7. Work authorization system (ensure the right work is done at the right time and in the right sequence) 8. Marketplace (competitors and contractor base for outsourcing) 9. Stakeholder risk tolerance 10. Political climate 11. Communication system 12. Information system 13. Commercial databases for cost and risk 2-27
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Unit 2
Stakeholders (Reference Manual p. 2-9, PMBOK® Guide pp. 32-33)
• Stakeholders may include anyone who is: • Involved in a project • Affected by project results • In a position to influence the project while it is underway
• PMI heavily emphasizes the importance of identifying and managing key stakeholders • PMBOK 5 includes a new knowledge area on stakeholder management
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Unit 2
Key Issues in Managing Stakeholders (Reference Manual p. 2-9, PMBOK® Guide pp. 32-33)
• Stakeholder requirements must be incorporated in the project management plan • Stakeholder identification is a continuous process • Overlooking negative stakeholders may increase risk of failure • If stakeholder expectations come into conflict, resolution should usually favor the customer • On some projects, the customer performs as the sponsor (no separate internal sponsor)
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Unit 2
Project Team and Other Roles (Reference Manual pp. 2-9 & 10, PMBOK® Guide pp. 35-38)
A project team consists of people with the right knowledge and skills to carry out the work • PMI defines the following roles: • Project management staff (perform management activities) • Project staff (carry out the work with no management responsibility) • Supporting experts (functional experts known as “SME’s”) • User or customer (liaisons who coordinate activities, advise on requirements, and accept deliverables) • Sellers (also called vendors, suppliers, or contractors; a contract usually governs the relationships for outsourced work) 2-30
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Unit 2
Project Life Cycle: Cost and Staffing Levels (Reference Manual p. 2-10, PMBOK® Guide pp. 38-40)
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Unit 2
Risk, Influence, and Changes (Reference Manual p. 2-10, PMBOK® Guide pp. 38-40)
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Unit 2
Appendix I: PMI® Code of Ethics • The Reference Manual describes the PMI® Code of Ethics and Professional Conduct (Unit 2, Appendix I). • This material is no longer tested as extensively as it once was. However, a brief review of this material during your self-study would be advisable.
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Unit 2
Appendix II: International Project Management • The Reference Manual describes factors that often affect projects conducted internationally (Unit 2, Appendix II). • This material is no longer tested as extensively as it once was. However, a brief review of this material during your self-study would be advisable.
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Unit 2
Drill Practice Reminder • In the reference manual, there is an item called Drill Practice • It is the equivalent of a set of flash cards: question and answer format • This is an effective way to help memorize key details • Many people do the drill practice just before taking the practice exam for that chapter • Drill practice for this chapter starts on p. 2-11
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Unit 3
PROCESSES
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Unit 3
PMI PROCESSES • Processes and Process Groups • Activities Aligned with Process Groups • Project Information • Building Blocks of the Body of Knowledge • Mapping Processes, Process Groups, and Knowledge Areas • PMI Changes After 1 November
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Unit 3
Processes (Reference Manual p. 3-1, PMBOK® Guide p. 47)
• PMI defines a process as: • A set of interrelated actions performed to achieve a pre-specified set of products, results, or services
• Processes fall into 2 categories: • Product processes: specify and create the desired product • Project processes: used to initiate, plan, execute, control, and close the project work (project management activities)
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Unit 3
Process Groups (Reference Manual p. 3-1, PMBOK® Guide pp. 47-49)
• PMI has organized all 47 project management processes into the following 5 process groups: • Initiating: defining and authorizing the project or phase • Planning: establishing scope, refining objectives, and defining a course of action to attain the objectives • Executing: completing the work defined by the plan • Monitoring and Controlling: measuring progress, identifying variances from the plan, and recommending corrective action when necessary • Closing: formally accepting the project or phase results; bringing the project to an orderly end 3-4
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Unit 3
Process Groups: Key Characteristics (Reference Manual p. 3-1, PMBOK® Guide pp. 47-49)
• Process groups: • Are linked by the results they produce: an output often becomes an input to the next process
Example: The charter is the output to Develop Project Charter and becomes an input to the next process, Develop Project Plan
• Are overlapping and iterating, e.g., a problem during execution may require a revision to the plan • Occur in all phases of a project, i.e., each phase of a project must be initiated, planned, executed, controlled, and closed
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Unit 3
Process Group Activities: Initiating (Reference Manual pp. 3-2 to 3-4)
• Typical initiating activities include the following: • Perform project assessment using: Available information Lessons learned Meetings with stakeholders Purpose: evaluate feasibility of a new project • Identify key deliverables and manage customer expectations • Perform stakeholder analysis: Align expectations Gain support • Establish goals and objectives 3-6
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Unit 3
Process Group Activities: Initiating (cont’d) (Reference Manual pp. 3-2 to 3-4)
• Additional initiating activities include: • Determine high level: Product description, key deliverables, milestones Constraints, assumptions, time and cost estimates Resource requirements and risks • Define responsibilities of the PM • Conduct benefit analysis: validate project alignment with organizational strategy and expected business value • Develop and obtain approval of project charter • Inform stakeholders of approved charter 3-7
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Unit 3
Process Group Activities: Planning (Reference Manual pp. 3-2 to 3-4)
• Typical planning activities include the following: • Review and assess detailed project requirements based on the project charter • Develop detailed management plans: Change management, scope, schedule, cost Quality, HR, communication Risk, procurement, stakeholder • Create a detailed scope statement • Determine who is needed on the project team
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Unit 3
Process Group Activities: Planning (cont’d) (Reference Manual pp. 3-2 to 3-4)
• Additional planning activities include: • Develop a WBS and associated WBS dictionary • Finalize needed team members • Create a network diagram and estimate durations • Determine critical path and develop schedule • Estimate costs and determine budget
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Unit 3
Process Group Activities: Planning (cont’d) (Reference Manual pp. 3-2 to 3-4)
• Additional planning activities include: • Analyze stakeholder needs, interests, and potential impact: Engage stakeholders in project decisions Effectively manage stakeholder expectations • Develop a formal project management plan • Obtain formal approval of the project management plan • Conduct a kick-off meeting
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Unit 3
Process Group Activities: Executing (Reference Manual p. 3-3)
• Typical executing activities include the following: • Set up a project organization • Acquire, develop, and manage the project team • Manage stakeholders • Conduct team building • Perform quality assurance • Perform (execute) work packages • Manage the flow of information per the communication plan • Maintain stakeholder relationships and manage expectations Note: PMI sometimes refers to executing as implementing 3-11
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Unit 3
Process Group Activities: Monitoring/Controlling (Reference Manual p. 3-4)
• Typical monitoring and controlling activities include the following: • Perform integrated change control • Perform various control processes: scope, schedule, cost, quality, risk, procurement, and stakeholder • Measure and report project performance • Monitor project variances: Plan minus Actual • Take corrective action • Capture, analyze, and manage lessons learned • Monitor procurement activities to verify compliance
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Unit 3
Process Group Activities: Closing (Reference Manual p. 3-4)
• Typical closing activities include the following: • Review and accept project results Procurement audits Product verification Formal acceptance • Transfer ownership of deliverables to appropriate stakeholders • Evaluate project results (lessons learned) • Update and archive records • Obtain feedback from stakeholders • Reassign resources (release team) 3-13
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Unit 3
Project Information (Reference Manual p. 3-5, PMBOK® Guide pp. 58-59)
• Know the following terminology: • Work performance data: raw measurements of work (Task A took 4 days) • Work performance information: data that have been analyzed and interpreted (Task A is ahead of schedule) • Work performance reports: presentation of results to the right audience
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Unit 3
Building Blocks of the Body of Knowledge (Reference Manual p. 3-6, PMBOK® Guide pp. 60-61)
• Fundamental Building Blocks: • Knowledge Areas:
10 management areas that must be handled by any PM
Integration, scope, time, cost, quality, HR, communication, risk, procurement, stakeholder
• Process Groups:
5 management domains that reflect the chronological progression of project management
Initiating, planning, executing, monitoring and controlling, closing
• Processes:
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47 discrete processes that must be performed and that map to the knowledge areas and process groups
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Unit 3
Mapping Knowledge Areas, Process Groups, and Processes (Reference Manual p. 3-7, PMBOK® Guide pp. 60-61)
Process Groups Knowledge Areas Integration
Initiating Develop project charter
Planning Develop project mgmt plan
Executing
Controlling
Direct/manage project work
Monitor/control project work Perform integrated change control
Closing Close project or phase
Scope The remaining 41 processes may be seen in the:
Time Cost Quality
•
Reference Manual p. 3-7
•
Formula and Process Guide
•
PMBOK® Guide p. 61
HR Communication Risk Procurement Stakeholder 3-16
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Unit 3
PMI Changes After 1 November 2015 (Exam Content Outline, June 2015)
• What has not changed: • The 10 knowledge areas and 5 process groups are unchanged • 4 hours to complete 200 multiple choice questions is unchanged • The scoring of the exam is unchanged • Qualifications to be allowed to take the exam are unchanged
• What has changed: • The new exam content outline added 8 new tasks (see following slides) • There will be increased emphasis on certain topics (see following slides)
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PMI Changes: New Initiating Tasks (Exam Content Outline, June 2015)
• New Initiating Tasks (3): • Identify key deliverables based on business requirements in order to:
Manage customer expectations
Achieve project goals
• Conduct benefit analysis with relevant stakeholders to:
Validate project alignment with organizational strategy
Validate expected business value
• Inform stakeholders of the approved charter:
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Ensure common understanding of key deliverables, milestones, and stakeholder roles
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Unit 3
PMI Changes: New Planning Tasks (Exam Content Outline, June 2015)
• New Planning Tasks (1): • Develop the stakeholder management plan by:
3-19
Analyzing needs, interests, and potential impact of stakeholders
Engaging stakeholders in project decisions
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Unit 3
PMI Changes: New Executing Tasks (Exam Content Outline, June 2015)
• New Executing Tasks (2): • Manage the flow of information by:
Following the communications plan
Keeping stakeholders engaged (involved) and informed
• Maintain stakeholder relationships by:
3-20
Following the stakeholder management plan
Managing expectations
Fostering continued support
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Unit 3
PMI Changes: New Monitoring/Controlling Tasks (Exam Content Outline, June 2015)
• New Monitoring and Controlling Tasks (2): • Capture, analyze, and manage lessons learned:
Use lessons learned techniques to enable continuous improvement
• Monitor procurement activities in accordance with the procurement plan:
3-21
Verify compliance with project objectives
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Unit 3
PMI Changes: Closing Tasks (Exam Content Outline, June 2015)
• There are no new closing tasks!!
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Unit 3
PMI Changes: Increased Emphasis Areas (Exam Content Outline, June 2015)
• Expect the following areas to receive more emphasis: • Benefits analysis • The opportunity side of risk management • Stakeholder management plans and associated communication • Lessons learned
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Unit 3
Drill Practice Reminder • In the reference manual, there is an item called Drill Practice: • It is the equivalent of a set of flash cards: question and answer format • This is an effective way to help memorize key details • Many people do the drill practice just before taking the practice exam for that chapter • Drill practice for this chapter starts on p. 3-11
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Unit 4
INTEGRATION MANAGEMENT
4-1
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Unit 4
Integration Management Concept (Reference Manual p. 4-1, PMBOK® Guide p. 63)
• Integration management unifies, coordinates, and manages the interdependencies among all processes and project management activities • It is the only knowledge area with processes in all 5 process groups • Overview of processes: • Develop Project Charter • Develop Project Management Plan • Direct and Manage Project Work • Monitor and Control Project Work • Perform Integrated Change Control • Close Project or Phase 4-2
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Unit 4
Overview of Topics in Unit 4 • Integration Management Processes • Other Topics • Information that has been tested but is not covered by the PMBOK® Guide.
• Drill Practice
4-3
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Unit 4
Overview of Integration Management Processes (Reference Manual p. 4-1, PMBOK® Guide p. 63)
4.1 Develop Project Charter (a document that formally authorizes a project or phase and also documents initial requirements)
4.2 Develop Project Management Plan (defining and integrating subsidiary plans into a comprehensive master project management plan)
4.3 Direct and Manage Project Work (performing the work defined in the project plan to achieve project objectives)
4.4 Monitor and Control Project Work (tracking, reviewing, and regulating progress toward meeting performance objectives)
4.5 Perform Integrated Change Control (reviewing all change requests and managing all changes to the project)
4.6 Close Project or Phase (finalizing all activities for a project or phase) 4-4
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Unit 4
Selected Knowledge Area, Process Groups, and Processes (Reference Manual p. 3-7, PMBOK® Guide pp. 60-61)
Process Groups Knowledge Areas Integration
Initiating
Planning
Executing
Controlling
Develop project charter
Develop project mgmt plan
Direct/manage project work
Monitor/control project work Perform integrated change control
Closing Close project or phase
Scope Time Cost Quality HR Communication Risk Procurement Stakeholder 4-5
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Unit 4
Develop Project Charter: Introduction (Reference Manual p. 4-1, PMBOK® Guide p. 66)
• Is one of only two processes in the initiating process group • Written document officially authorizing a project or phase • Documents initial, high-level requirements/scope and business need • The initial requirements are established on the basis of stakeholder needs and objectives • Identifies project manager and confers power/authority
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Unit 4
Develop Project Charter (Reference Manual p. 4-2, PMBOK® Guide p. 66)
Inputs
Tools
Project statement of work
Expert judgment
Business case
Facilitation techniques
Outputs Project charter
Agreements EEF OPA
Note: EEF = Enterprise Environmental Factors OPA = Organizational Process Assets 4-7
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Unit 4
Develop Project Charter: Key Points (Reference Manual p. 4-1, PMBOK® Guide p. 66)
• The charter: • Formally initiates the project. • Establishes a partnership between the performing and requesting organizations. • Identifies the PM. Ideally, the PM would help write the charter. • However, the PM should not sign the charter and should never be assigned later than the start of planning. • Upper management or the project sponsor should sign the charter to increase authority of the PM.
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Unit 4
Develop Project Charter: Key Points (Reference Manual pp. 4-1 to 4-4, PMBOK® Guide p. 66)
• The charter: • Authorizes the PM to acquire and use organizational resources. • Provides a description of project goals and objectives. • Is supported by needs analysis and feasibility studies. • Is part of the initiating process group. • Is performed before Identify Stakeholders: Project charter is an input to Identify Stakeholders Stakeholder register is not an input to Develop Charter
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Unit 4
Inputs to Develop Project Charter (Reference Manual p. 4-2, PMBOK® Guide p. 68)
• The statement of work (SOW): Provides a narrative description of products, services, or results to be delivered. • Internal projects: sponsor provides SOW based on business needs. • External projects: customer provides SOW as part of proposal or bid document.
• Business case: Describes business need and cost-benefit analysis. • Agreements: A contract is used for external customers. • EEF/OPA: Factors that influence success. Also, standard procedures, templates, historical information, lessons learned.
4-10
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Unit 4
Tools for Develop Project Charter (Reference Manual p. 4-3, PMBOK® Guide p. 71)
• Expert judgment: • Assesses accuracy of technical and management information. • Is a tool for 28 of 47 processes.
• Facilitation techniques: • Assisting the work of teams and small groups through the use of specific techniques. • Brainstorming, conflict resolution, problem solving, and meeting management.
4-11
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Unit 4
Outputs from Develop Project Charter (Reference Manual p. 4-4, PMBOK® Guide p. 71)
• Project charter. A formal document authorizing the project and providing the following high-level information: • Project purpose and business/customer needs • Project objectives and success criteria • High-level requirements • High-level risks, budget, and milestone schedule • Stakeholder list • Approval requirements (acceptance criteria and who signs off on the project) • Name and authority of the PM • Name and authority of the sponsor 4-12
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Unit 4
Develop Project Management Plan: Introduction (Reference Manual p. 4-4, PMBOK® Guide p. 72)
• Is part of the planning process group • Defines how the project will be executed, monitored, controlled, and closed • Creates a comprehensive plan by integrating all detailed subsidiary plans: • Scope
Schedule
• Communication
Cost
Risk
Quality
HR/Staffing
Procurement
Stakeholder
• Is developed by the entire team, not just the PM
4-13
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Unit 4
Develop Project Management Plan (Reference Manual p. 4-5, PMBOK® Guide p. 72)
Inputs
Tools
Project charter
Expert judgment
Outputs from other processes
Facilitation techniques
Outputs Project management plan
EEF OPA
4-14
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Unit 4
Develop Project Management Plan: Key Points (Reference Manual p. 4-4 PMBOK® Guide p. 72)
• Guides execution and control of a project • The completed plan must be presented to appropriate stakeholders for approval to proceed • Changes to the plan must be approved using the integrated change control process • Provides the guide for performing all project work • Forms the baseline against which any changes are made
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Unit 4
Inputs to Develop Project Management Plan (Reference Manual p. 4-5, PMBOK® Guide p. 74)
• Project charter: The output of the previous process often becomes an input to the next process • Outputs from other processes: • The project plan is a collection of detailed subsidiary plans • Scope, schedule, cost, quality, HR, communication, risk, procurement, and stakeholder
• EEF/OPA: • Factors that may influence success • Standard procedures, templates, historical information, lessons learned
4-16
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Unit 4
Tools for Develop Project Management Plan (Reference Manual p. 4-6, PMBOK® Guide p. 76)
• Expert judgment: • Assess accuracy of information used in developing the plan • Helps with tailoring the plan as well as technical and management details
• Facilitation techniques: • Assisting the work of teams through the use of specific techniques • Brainstorming, conflict resolution, problem solving, and meeting management
4-17
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Unit 4
Outputs from Develop Project Management Plan (Reference Manual p. 4-6, PMBOK® Guide p. 76)
• Project management plan. A formal, approved document used to guide execution of the project
• Is distributed as defined in the communication plan and contains the following: • Scope management plan • Requirements management plan • Schedule management plan • Cost management plan • Quality and process improvement plans
4-18
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Unit 4
Outputs from Develop Project Management Plan (Reference Manual p. 4-6, PMBOK® Guide p. 76)
• Information contained in the project plan (continued): • Human resource management plan • Communication management plan • Risk management plan • Procurement management plan • Stakeholder management plan • Baselines: Scope, schedule, cost
4-19
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Unit 4
Direct and Manage Project Work: Introduction (Reference Manual p. 4-7, PMBOK® Guide p. 79)
• Is part of the executing process group • The PM and other managers direct performance of planned activities • Previously approved changes must also be implemented as part of directing and managing the work • Work performance data: • Describes the actual status of required deliverables • Is collected and fed into the performance reporting process
4-20
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Unit 4
Direct and Manage Project Work (Reference Manual p. 4-8, PMBOK® Guide p. 79)
Inputs
Tools
Outputs
Project management plan
Expert judgment
Deliverables
Approved change requests
Project management information system
Work performance data
EEF
Meetings
Change requests
OPA
Project management plan updates Project documents updates
4-21
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Unit 4
Direct and Manage Project Work: Key Points (Reference Manual p. 4-7 PMBOK® Guide p. 79)
• Actions performed while executing the project plan include: • Set up a project organization • Acquire, develop, and manage the project team • Obtain other resources (materials, equipment, facilities) • Lead, manage, and/or perform project activities • Perform quality assurance • Manage the flow of information • Generate project data for status reports and forecasts
4-22
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Unit 4
Direct and Manage Project Work: Key Points (Reference Manual p. 4-7 PMBOK® Guide p. 79)
• Additional actions performed while executing the project plan: • Conduct change control and implement approved changes • Establish and manage communication channels • Manage risks • Obtain quotes, bids, and proposals for work to be outsourced • Manage sellers • Manage stakeholders and maintain stakeholder relationships • Collect and document lessons learned
4-23
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Unit 4
Inputs to Direct and Manage Project Work (Reference Manual p. 4-8, PMBOK® Guide p. 82)
• Project management plan: Provides the foundation for executing the work of the project
• Approved change requests: • Previously approved changes that may expand or reduce project scope • The team must manage the implementation of the change
• EEF/OPA: • Factors that may influence success • Standard procedures, historical information, lessons learned
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Tools for Direct and Manage Project Work (Reference Manual p. 4-9, PMBOK® Guide p. 83)
• Expert judgment: Expertise of the PM and the team • Project management information system: • Provides access to information collection and distribution systems • Also provides access to automated information systems for change control, scheduling, budgeting, etc.
• Meetings. PMI identifies 3 types of meetings: • Information exchange, brainstorming, and decision making • All meetings should have a: clearly defined purpose, agenda, time frame, and be documented with minutes
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Unit 4
Outputs from Direct and Manage Project Work (Reference Manual p. 4-9, PMBOK® Guide p. 84)
• Deliverables: Any unique verifiable product, result, or capability that must be completed as part of the project plan
• Work performance data: Raw measurements of the actual status of the work • Data are collected and fed to various control processes for interpretation. Examples include: Actual costs and durations Actual start and finish dates Number of defects Number of change requests 4-26
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Unit 4
Outputs from Direct and Manage Project Work (Reference Manual p. 4-9, PMBOK® Guide p. 84)
• Change requests: Used to modify procedures, scope, schedule, cost, or quality • Change requests may lead to the use of: Corrective actions Preventive actions Defect repairs • Read and know the following:
4-27
For the exam, be aware of “situational” questions in which various parties (senior manager, customer, etc.) want a change to the project. The appropriate first response is to evaluate the impact of the change and meet with the team to discuss alternatives. Common incorrect choices often involve meeting first with management or the customer.
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Unit 4
Outputs from Direct and Manage Project Work (Reference Manual p. 4-9, PMBOK® Guide p. 84)
• Project Management Plan and Project Documents Updates: • When there are changes to the project, the project plan or other documents may require updates. • Any item that ends with the word “updates” is always an output. • Examples of changes to the project plan include: Scope, schedule, cost, quality, etc. • Examples of other documents that may be changed include: Issue logs, risk register, stakeholder register, etc.
4-28
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Unit 4
Monitor and Control Project Work: Introduction (Reference Manual p. 4-11, PMBOK® Guide p. 86)
• Is part of the monitoring and controlling process group • Involves tracking, reviewing, and regulating progress toward meeting objectives • Monitoring collects data and interprets the status of the project • Controlling determines whether any responses are appropriate: • Corrective action • Preventive action • Defect repairs
4-29
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Unit 4
Monitor and Control Project Work (Reference Manual p. 4-11, PMBOK® Guide p. 86)
Inputs
Tools
Outputs
Project management plan
Expert judgment
Change requests
Schedule forecasts
Analytical techniques
Work performance reports
Cost forecasts
Project management information system
Project management plan updates
Validated changes
Meetings
Project documents updates
Work performance information EEF OPA
4-30
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Unit 4
Monitor and Control Project Work: Key Points (Reference Manual p. 4-11 PMBOK® Guide p. 86)
• Compares actual versus planned performance (variance analysis) • Determines/recommends preventive or corrective action • Identifies risks, reports risk status, and ensures response plans are implemented • Maintains a timely, accurate information base: • Status reports: variances tracked on a periodic basis • Progress reports: list of deliverables completed • Forecasts: predicting final cost and schedule outcomes
• Monitors the implementation of approved changes 4-31
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Inputs to Monitor and Control Project Work (Reference Manual p. 4-11, PMBOK® Guide p. 88)
• Project management plan: The project baselines provide the plan element for variance analysis (plan vs. actual).
• Schedule and cost forecasts: Predicting cost and schedule outcomes based on current progress.
• Validated changes: Changes that have been approved using integrated change control and must now be implemented.
• Work performance information: Data that have been interpreted and show the status of the work.
• EEF/OPA: • Factors that may influence success • Standard procedures, historical information, lessons learned 4-32
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Unit 4
Tools for Monitor and Control Project Work (Reference Manual p. 4-13, PMBOK® Guide p. 91)
• Expert judgment: Experts used to correctly interpret the information collected
• Analytical techniques. Various forecasting methods such as: • Trend or variance analysis • Earned value management
• Project management information system: As before, provides access to automated information tools.
• Meetings. Stakeholders using 2 types of meetings: • User groups and review meetings
4-33
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Unit 4
Outputs from Monitor and Control Project Work (Reference Manual p. 4-13, PMBOK® Guide p. 92)
• Change requests: May be issued to adjust the project if deemed necessary • As always, changes may involve: Corrective action Preventive action Defect repairs
• Work performance reports: Presentation of project information to appropriate stakeholders
4-34
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Unit 4
Outputs from Monitor and Control Project Work (Reference Manual p. 4-13, PMBOK® Guide p. 92)
• Project Management Plan and Project Documents Updates: • When there are changes to the project, the project plan or other documents may require updates • Examples of changes to the project plan include: Scope, schedule, cost, quality, etc. • Examples of other documents that may be changed include: Issue logs Work performance reports Schedule and cost forecasts
4-35
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Unit 4
Perform Integrated Change Control: Introduction (Reference Manual p. 4-14, PMBOK® Guide p. 94)
• Is part of the monitoring and controlling process group • Reviews all requests to change or modify the project • Change requests may affect: • Deliverables • Baselines • Organizational processes • Project documents or the project management plan
• All changes must be reviewed, approved or rejected, managed, and the disposition communicated 4-36
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Unit 4
Perform Integrated Change Control (Reference Manual p. 4-16, PMBOK® Guide p. 94)
Inputs
Tools
Outputs
Project management plan
Expert judgment
Approved change requests
Work performance reports
Meetings
Change log
Change requests
Change control tools
Project management plan updates
EEF
Project documents updates
OPA
4-37
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Unit 4
Perform Integrated Change Control: Key Points (Reference Manual p. 4-14 PMBOK® Guide p. 94)
• Changes are common and must be managed effectively • Informal changes that circumvent the system must be prevented (no scope creep) • All change requests must be reviewed promptly: • Usually by the CCB (Change control board) • Small changes may designated to another party
• All changes must be approved and managed using: • Proper documentation, tracking, and approval procedures • Effective communication to ensure stakeholder awareness
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Unit 4
Perform Integrated Change Control: Key Points (Reference Manual p. 4-14 PMBOK® Guide p. 94)
• The integrity of baselines must be maintained (scope, schedule, cost): • Only approved changes may be added to a revised baseline
• The CCB must document the likely impact of changes: • Changes must be coordinated across the entire project • Example: A schedule change might affect cost, quality, staffing, or risk
• It is possible to have more than one CCB: • Different projects within a program • CCB’s with technical vs. cost responsibility, etc. 4-39
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Unit 4
Perform Integrated Change Control: Key Points (Reference Manual p. 4-14 PMBOK® Guide p. 94)
• The change control process should be able to accommodate emergency changes: • Some changes may proceed without prior review and approval • However; review, approval, and proper documentation must be accomplished as soon as practical
• In some cases, changes may be approved by the customer (as per contract provisions) • Any stakeholder may request a change at any time • Verbal change requests must always be recorded in writing • Every change request must be either approved or rejected with supporting documentation 4-40
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Unit 4
Change Control and Configuration Management (Reference Manual p. 4-15 PMBOK® Guide pp. 96-97)
• Change control operates as a subset of configuration management: • Configuration management is focused on specifying project deliverables and processes • Change control manages changes to project documents, deliverables, or baselines
• Configuration management consists of 3 major activities: 1. Identify characteristics of the product or service and establish scope, schedule, and cost baselines 2. Control changes to the baselines and keep careful records 3. Audit final project results to verify that all requirements, including changes, have been met Note: Configuration management controls emerging scope against the baseline 4-41
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Unit 4
Inputs to Perform Integrated Change Control (Reference Manual p. 4-16, PMBOK® Guide p. 97)
• Project management plan. Elements of the project plan which are especially relevant to change control include: • Project baselines (scope, schedule, and cost). Note: changes are made against these baselines.
• Change management plan which addresses: How change control will be managed The role of the CCB
• Work performance reports: Schedule, cost, resource availability, and earned value reports
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Unit 4
Inputs to Perform Integrated Change Control (Reference Manual p. 4-17, PMBOK® Guide p. 97)
• Change requests: Change requests are outputs with this single exception • Change control is not needed unless a change has, in fact, been requested
• Enterprise Environmental Factors (EEF): • The use of information systems such as configuration management
• Organizational Process Assets (OPA): • Change control procedures • Historical files • Configuration management knowledge base 4-43
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Tools for Perform Integrated Change Control (Reference Manual p. 4-17, PMBOK® Guide p. 98)
• Expert judgment: Appropriate experts must be on the CCB • Meetings: Change control meetings by the CCB. • Review change requests • Approve or reject • Communicate the results
• Change control tools: Manual or automated tools to manage change requests
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Unit 4
Outputs from Perform Integrated Change Control (Reference Manual p. 4-17, PMBOK® Guide p. 99)
• Approved change requests: All changes must be approved or rejected • Approved changes are implemented through the Direct and Manage Project Work process • The disposition of all change requests must be documented in the change log
• Change log: A written record of all change decisions and rationale • At any point in time: All change requests must be classified as to disposition (approved, rejected, or pending)
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Outputs from Perform Integrated Change Control (Reference Manual p. 4-18, PMBOK® Guide p. 99)
• Project Management Plan and Project Documents Updates: • When there are changes to the project, the project plan or other documents may require updates • Project plan updates would include: Changes to any subsidiary plans (scope, schedule, cost,…) Changes to the baselines • Updates to other documents would include: Change request log
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Unit 4
Close Project or Phase: Introduction (Reference Manual p. 4-18, PMBOK® Guide p. 100)
• Is part of the closing process group • Finalizes all activities across all process groups to formally close a project or phase • Results in lessons learned and archiving of important records
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Unit 4
Close Project or Phase (Reference Manual p. 4-18, PMBOK® Guide p. 100)
Inputs
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Tools
Outputs
Project management plan
Expert judgment
Final product, service, or result transition
Accepted deliverables
Analytical techniques
OPA updates
OPA
Meetings
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Unit 4
Close Project or Phase: Key Points (Reference Manual p. 4-18 PMBOK® Guide p. 100)
• Review scope baseline to ensure all work has been completed and project objectives have been met • Formalize acceptance of deliverables (sign-off) • Document circumstances if project is terminated before completion; consult all appropriate stakeholders • Administrative aspects of closure: • Ensure exit criteria for phase or project have been met • Ensure product, service, or result has been transferred to next phase, production, or operations • Collect and archive final records • Document lessons learned and final performance outcomes 4-49
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Inputs to Close Project or Phase (Reference Manual p. 4-19, PMBOK® Guide p. 102)
• Project management plan: The project plan is the agreement between the PM and the sponsor about what constitutes completion.
• Accepted deliverables: Deliverables that have been accepted as a result of the Validate Scope process, Section 5.5.
• Organizational Process Assets (OPA): • Guidelines for project or phase closure • Historical information and lessons learned
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Tools for Close Project or Phase (Reference Manual p. 4-19, PMBOK® Guide p. 102)
• Expert judgment: Experts ensure that closure is conducted using correct standards
• Analytical techniques: • Regression analysis • Trend analysis
• Meetings: • User groups and review meetings • Lessons learned meetings
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Outputs from Close Project or Phase (Reference Manual p. 4-19, PMBOK® Guide p. 103)
• Final product, service, or result transfer: Transferring results to the next step or phase
• OPA updates. Record keeping of the following: • Project files: project management plan • Project or phase closure documents showing: Completion of the project Transfer of deliverables Documentation if project terminated early • Historical information: lessons learned and historical data 4-52
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Other Topics (Reference Manual p. 4-20, PMBOK® Guide No Reference)
• Other Topics covers information known to be on the real exam but not addressed by the PMBOK® Guide: • Management by Objectives (MBO) • Project Evaluation • Customer Satisfaction • Roles and Responsibilities
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Unit 4
Management by Objectives (MBO) (Reference Manual p. 4-20, PMBOK® Guide No Reference)
• Created by Peter Drucker, MBO is a 3-step, collaborative process for setting objectives. 1. Identify clear, realistic objectives 2. Measure progress toward meeting objectives 3. Take action or make adjustments if necessary
• Workers and their managers jointly establish objectives • Objectives are considered to be “clear” if different parties agree on the same meaning • MBO will be more successful if supported by top management
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Project Evaluation (Reference Manual pp. 4-20/21, PMBOK® Guide No Reference)
• Big picture look at the project usually conducted by outsiders • Mid-project evaluation is conducted during the project: • To determine whether the project is meeting its objectives and whether those objectives are still relevant and worthwhile • Potential outcomes: Identify problems Implement changes Terminate the project
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Unit 4
Project Evaluation (Reference Manual pp. 4-20/21, PMBOK® Guide No Reference)
• Potential problems with mid-project evaluation: • Senior managers misusing evaluations to: Find someone to blame or punish Pursue political agendas • Project team may be hostile and uncooperative; may feel the process is arbitrary and/or political • Evaluations can be time consuming
• Post-project evaluation is conducted when the project is complete: • Identify lessons learned and collect historical data
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Customer Satisfaction (Reference Manual p. 4-21, PMBOK® Guide No Reference)
• A primary determinant of customer satisfaction is whether: • An accurate needs assessment was done at the outset of the project • If not, you might meet the triple constraint perfectly but deliver a product the customer cannot or will not use Requirements are devised from needs Problem: The requirements are incorrect because they are based on an inaccurate understanding of customer needs
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Roles and Responsibilities (Reference Manual pp. 4-21/22, PMBOK® Guide No Reference)
• Senior management: • Assign and empower project managers • Approve the project plan • Protect the project from attack by outsiders
• Sponsor: • The source of funding for the project • Champion the project during initiation and thereafter • May lead project selection and development of initial scope/charter
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Roles and Responsibilities (Reference Manual pp. 4-21/22, PMBOK® Guide No Reference)
• Project manager: • In charge of the project but not necessarily the resources • Plan and lead the project • Assign tasks to team members
• Team members: • Help develop WBS • Provide estimates for their personal tasks • Perform their tasks • Resolve conflict directly without escalating as the first resort 4-59
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Drill Practice Reminder • In the reference manual, there is an item called Drill Practice: • It is the equivalent of a set of flash cards: question and answer format • This is an effective way to help memorize key details • Many people do the drill practice just before taking the practice exam for that chapter • Drill practice for this chapter starts on p. 4-23
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Unit 5
SCOPE MANAGEMENT
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Unit 5
Scope Management Concept (Reference Manual p. 5-1, PMBOK® Guide p. 105)
• Scope management ensures that a project includes all the work required and only the work required to complete the project successfully • Primary concern: defining and managing what is and is not included in the project • Overview of 6 processes: • Plan Scope Management • Collect Requirements • Define Scope • Create WBS • Validate Scope • Control Scope 5-2
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Scope Management: Key Points (Reference Manual p. 5-1, PMBOK® Guide p. 105)
• Two kinds of scope: • Product scope: Features and functions of the product, service, or result • Project scope: Management activities required to deliver the product, service, or result
• Scope baseline consists of the approved: • Scope statement • WBS • WBS dictionary • Note: the scope baseline should only be changed using formal change control procedures! 5-3
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Overview of Topics in Unit 5 • Scope Management Processes • Other Topics • Information that has been tested but is not covered by the PMBOK® Guide
• Drill Practice
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Unit 5
Overview of Scope Management Processes (Reference Manual p. 5-1, PMBOK® Guide p. 105)
5.1 Plan Scope Management (creating a scope management plan that documents how project scope will be defined, validated, and controlled)
5.2 Collect Requirements (defining and documenting stakeholders’ needs and requirements to meet project objectives)
5.3 Define Scope (developing a detailed description of the project and product)
5.4 Create WBS (subdividing project deliverables into smaller, more manageable components)
5.5 Validate Scope (formalizing acceptance of completed project deliverables)
5.6 Control Scope (monitoring status of the project and product scope, and managing changes to the scope baseline) 5-5
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Unit 5
Selected Knowledge Area, Process Groups, and Processes (Reference Manual p. 3-7, PMBOK® Guide pp. 60-61)
Process Groups Knowledge Areas
Initiating
Planning
Executing
Controlling
Closing
Integration Scope
Plan scope mgmt
Validate scope
Collect requirements
Control scope
Define scope Create WBS
Time Cost Quality HR Communication Risk Procurement Stakeholder 5-6
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Plan Scope Management: Introduction (Reference Manual p. 5-1, PMBOK® Guide p. 107)
• Is part of the planning process group • Results in a scope management plan which: • Documents how project scope will be defined, validated, and controlled • Plans the approach for accomplishing the remaining 5 processes: Collect requirements Define scope Create WBS Validate scope Control scope 5-7
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Unit 5
Plan Scope Management (Reference Manual p. 5-2, PMBOK® Guide p. 107)
Inputs
Tools
Outputs
Project management plan
Expert judgment
Scope management plan
Project charter
Meetings
Requirements management plan
EEF OPA
Note: EEF = Enterprise Environmental Factors OPA = Organizational Process Assets 5-8
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Inputs to Plan Scope Management (Reference Manual p. 5-2, PMBOK® Guide pp. 108-109)
• Project management plan: Approved subsidiary plans may influence the approach taken for planning and managing scope •
Scope, schedule, cost
•
Quality, HR, communication
•
Risk, procurement, stakeholder
• Project charter: Provides high-level project and product requirements • EEF/OPA: Factors that influence success, standard procedures, templates, historical information, and lessons learned
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Tools for Plan Scope Management (Reference Manual p. 5-3, PMBOK® Guide p. 109)
• Expert judgment: • Expertise provided by parties knowledgeable about scope management plans
• Meetings: • Selected stakeholders who attend meetings to develop the scope management plan
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Unit 5
Outputs from Plan Scope Management (Reference Manual p. 5-3, PMBOK® Guide pp. 109-110)
• Scope management plan: Describes how scope will be defined, monitored, validated, and controlled. Includes: • Process for preparing a scope statement • Process for creating and maintaining the WBS • Process for formal acceptance of deliverables • Process for managing scope changes
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Unit 5
Outputs from Plan Scope Management (Reference Manual p. 5-3, PMBOK® Guide pp. 109-110)
• Requirements management plan: Describes how requirements will be analyzed, documented, and managed. Includes: • How requirements will be planned, tracked, and reported • How changes to requirements will be handled • Requirements prioritization processes • Product metrics • Traceability structure
5-12
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Unit 5
Collect Requirements: Introduction (Reference Manual pp. 5-3 & 4, PMBOK® Guide pp. 110-112)
• Is part of the planning process group • Determines, documents, and manages stakeholders’ needs and requirements • Project success is directly influenced by stakeholder involvement in decomposing needs into requirements • Requirements form the basis for: • Developing the WBS • Schedule, cost, quality, and procurement plans
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Unit 5
Collect Requirements (Reference Manual p. 5-5, PMBOK® Guide p. 111)
Inputs
Tools
Outputs
Scope management plan
Interviews
Requirements documentation
Requirements management plan
Focus groups
Requirements traceability matrix
Stakeholder management plan
Facilitated workshops
Project charter
Group creativity techniques
Stakeholder register
Group decision-making techniques Questionnaires and surveys Observations Prototypes Benchmarking Context diagrams Document analysis
5-14
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Unit 5
Collect Requirements: Key Points (Reference Manual pp. 5-3 & 4 PMBOK® Guide pp. 110-112)
• Requirements include the documented needs and expectations of the sponsor, customer, and other stakeholders • Requirements must be recorded in enough detail to be measured during project execution • Development of requirements begins with analysis of information contained in the: • Project charter • Stakeholder register • Stakeholder management plan
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Unit 5
Collect Requirements: Key Points (Reference Manual pp. 5-3 & 4 PMBOK® Guide pp. 110-112)
• Requirements may be classified as follows: • Business: Higher-level needs of the organization; business opportunities; purpose of the project • Stakeholder: Perceived needs of a stakeholder or group • Solution: Features, functions, and characteristics of the product, service, or result • Transition: Training and data conversion needed to switch from the old (as-is) state to the new (to-be) state • Quality: Criteria needed to validate successful completion of project deliverables • Project: Conditions the project needs to meet 5-16
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Inputs to Collect Requirements (Reference Manual p. 5-5, PMBOK® Guide p. 113)
• Scope management plan: Clarifies which types of requirements need to be collected
• Requirements management plan: Identifies the processes to be used in defining stakeholder needs
• Stakeholder management plan: Identifies required levels of stakeholder involvement
• Project charter: Identifies high-level project and product requirements
• Stakeholder register: Identifies key stakeholders who can provide information on requirements
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Tools for Collect Requirements (Reference Manual pp. 5-6 to 5-8, PMBOK® Guide pp. 114-117)
• Interviews: Used to identify features and functions of desired product deliverables • May also be used to obtain confidential information
• Focus groups: • Interactive discussions guided by trained moderators • Purpose: document stakeholder expectations about a proposed product, service, or result
• Facilitated workshops: • Interactive discussions for defining cross-functional requirements • Purpose: build trust, improve communications, and uncover issues 5-18
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Unit 5
Tools for Collect Requirements (Reference Manual pp. 5-6 to 5-8, PMBOK® Guide pp. 114-117)
• Group creativity techniques: Ways for a group to generate ideas • Brainstorming and nominal group technique • See reference manual (pp. 5-6 & 7) for other examples and descriptions
• Group decision-making techniques: • Unanimity: requires 100% agreement • Majority: requires greater than 50% agreement
• Plurality: decision by agreement of the largest voting block • Dictatorship: decision made by one individual
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Unit 5
Tools for Collect Requirements (Reference Manual pp. 5-6 to 5-8, PMBOK® Guide pp. 114-117)
• Questionnaires and surveys. A written set of questions used for: • Reaching large audiences quickly • Enabling statistical analysis
• Observations (also called job shadowing): • Discreetly observing someone doing their job • Assists people who cannot articulate requirements without help
• Prototypes. Mock-ups and working models to: • Assist progressive elaboration of requirements • Allows stakeholders to interact and experiment with a model • Iterative cycles improves development of requirements 5-20
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Unit 5
Tools for Collect Requirements (Reference Manual pp. 5-6 to 5-8, PMBOK® Guide pp. 114-117)
• Benchmarking: Compares planned or actual practices to other organizations • Generates ideas for improvement • Provides new standards for measuring performance
• Context diagrams: Visual depictions of product scope •
Shows how people interact with the new product or system
• Document analysis: May provide insights into requirements • Business plans and marketing literature • RFPs (Requests for Proposals), laws, ordinances • Business processes 5-21
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Unit 5
Outputs from Collect Requirements (Reference Manual p. 5-8, PMBOK® Guide p. 117)
• Requirements documentation: Describes how requirements meet business needs • Requirements start as high-level information and become progressively more detailed (elaborated) • Every requirement should link to a business need • Requirements should be measureable, testable, traceable, complete, consistent, and acceptable to stakeholders • Possible categories: Business, stakeholder, solution Transition, quality, project
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Outputs from Collect Requirements (Reference Manual p. 5-8, PMBOK® Guide p. 117)
• Requirements traceability matrix: A table that links requirements to business needs • Uses of the matrix: Provides tracking of requirements during the project Helps in checking that requirements have been met (project closure) Helps track changes to requirements Shows decomposition of high-level requirements into the more detailed requirements
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Unit 5
Define Scope: Introduction (Reference Manual p. 5-9, PMBOK® Guide p. 120)
• Is part of the planning process group • Produces a written, detailed scope statement • The scope statement: • Is an agreement between the project team and the customer • Defines which requirements will be included or excluded from the project scope
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Unit 5
Define Scope (Reference Manual p. 5-9, PMBOK® Guide p. 120)
Inputs
5-25
Tools
Outputs
Scope management plan
Expert judgment
Project scope statement
Project charter
Product analysis
Project documents updates
Requirements documentation
Alternatives generation
OPA
Facilitated workshops
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Unit 5
Define Scope: Key Points (Reference Manual p. 5-9 PMBOK® Guide pp. 120-121)
• The level of uncertainty in defining project scope is greater for more complex projects • The Define Scope process selects: • Which requirements from the Collect Requirements process will actually be included in the final, approved project scope • Approves a detailed description of the project and product, service, or result
• Existing assumptions, constraints, and risks are checked for completeness and updated if necessary
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Inputs to Define Scope (Reference Manual p. 5-9, PMBOK® Guide p. 121)
• Scope management plan: Establishes how project scope will be developed, monitored, and controlled
• Project charter: Provides a high-level description of the project and product
• Requirements documentation: • This list of desired requirements was an output of the Collect Requirements process • Final, approved requirements are selected from this list
• OPA: Procedures, templates, historical files, and lessons learned
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Tools for Define Scope (Reference Manual p. 5-10, PMBOK® Guide p. 122)
• Expert judgment: Expertise related to technical details • Product analysis: Helpful when creating a product instead of a service or other result • Uses techniques to develop measureable deliverables and requirements • Examples: Product breakdown, requirements analysis, systems engineering, value engineering, and value analysis
• Alternatives generation: Techniques to identify potential options • Brainstorming • Lateral thinking • Analysis of alternatives 5-28
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Tools for Define Scope (Reference Manual p. 5-10, PMBOK® Guide p. 123)
• Facilitated workshops: • Was also a tool of Collect Requirements • Guided interactive discussions to: Develop cross-functional requirements Develop common understanding of objectives and any issues
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Unit 5
Outputs from Define Scope (Reference Manual p. 5-10, PMBOK® Guide p. 123)
• Project scope statement: A detailed description of project deliverables and the work required to create them • Provides common understanding of scope • Describes major objectives • Supports subsequent detailed planning • Guides execution and future decisions • Provides a baseline
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Unit 5
Outputs from Define Scope (Reference Manual pp. 5-10 & 11, PMBOK® Guide p. 123)
• Project scope statement (continued). Typical contents of the scope statement include: • Product description: Characteristics of the product, service, or result. May evolve through stages of progressive elaboration. • Acceptance criteria: Conditions required for acceptance of deliverables • Deliverables: Unique products, results, or capabilities that must be delivered
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Outputs from Define Scope (Reference Manual p. 5-11, PMBOK® Guide p. 124)
• Project scope statement (continued). Other typical contents of the scope statement include: • Exclusions: Explicit list of items considered out of scope (manages stakeholders’ expectations) • Constraints: Limiting factors or restrictions imposed on the project team by other stakeholders Predefined budget Imposed date or milestone • Assumptions: Factors believed to be true for planning Should be documented in writing May pose a risk 5-32
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Outputs from Define Scope (Reference Manual p. 5-11, PMBOK® Guide p. 125)
• Project documents updates: • Stakeholder register • Requirements documentation • Requirements traceability matrix
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Unit 5
Create WBS: Introduction (Reference Manual p. 5-11, PMBOK® Guide p. 125)
• Is part of the planning process group • Subdivides project deliverables into smaller, more manageable components • Provides a structured vision of what has to be delivered
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Unit 5
Create WBS (Reference Manual p. 5-12, PMBOK® Guide p. 125)
Inputs
Tools
Outputs
Scope management plan
Decomposition
Scope baseline
Project scope statement
Expert judgment
Project documents updates
Requirements documentation EEF OPA
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Unit 5
Create WBS: Key Points (Reference Manual pp. 5-11 & 12 PMBOK® Guide pp. 125-126)
• Organizes and defines the total scope of the project • Work not in the WBS is outside the scope of the project • When subdividing (decomposing) work, tasks at the lowest level of the WBS are called work packages • Work packages: • The level PMI considers adequate for scheduling, cost estimating, monitoring, and controlling the work • Accurate work packages = Accurate project planning
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Create WBS: Key Points (Reference Manual pp. 5-11 & 12 PMBOK® Guide pp. 125-126)
• A WBS dictionary contains a detailed description for each work package • A code of accounts provides a unique numerical identifier for each work package • An OBS (organizational breakdown structure) maps work assignments from organizational units to the WBS • A key benefit of accurate decomposition: • Carefully thinking through all required work • Less likely to forget tasks (therefore schedule and cost estimates are more likely to be accurate)
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Unit 5
Inputs to Create WBS (Reference Manual p. 5-12, PMBOK® Guide p. 127)
• Scope management plan: Specifies how to create the WBS • Project scope statement: Identifies deliverables which must be accomplished
• Requirements documentation: Detailed requirements that describe work that must be done to complete the project
• EEF: Industry-specific WBS standards and templates are sometimes available
• OPA: • Policies, procedures, and templates • Historical files • Lessons learned 5-38
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Tools for Create WBS (Reference Manual p. 5-13 & 14, PMBOK® Guide p. 128)
• Decomposition: Breaking the work into smaller , more manageable elements • The work package is the desired level of detail • Decomposition improves ability to plan, manage, and control the work • Excessive decomposition may lead to non-productive tracking and reporting of minute details (micro-management)
• Expert judgment: Technical knowledge of the work helps with decisions about decomposition
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Unit 5
Outputs from Create WBS (Reference Manual p. 5-14, PMBOK® Guide pp. 131-132)
• Scope baseline: Includes scope statement, WBS, and WBS dictionary • Scope statement: Already produced from Define Scope; identifies major deliverables • WBS. Decomposition of total scope and includes: Work packages: Lowest level of detail displayed and the level at which individual responsibility is assigned Control accounts: Contain one or more work packages; lowest level at which organizational responsibility is assigned Planning packages: Used in place of work packages for planning future work in less detail Code of accounts: Provides a WBS numbering system 5-40
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Unit 5
Outputs from Create WBS (Reference Manual p. 5-15, PMBOK® Guide p. 132)
• Scope baseline: Includes scope statement, WBS, and WBS dictionary • WBS dictionary. A companion document to the WBS and contains: Description of the work and technical requirements Responsible resources and deliverables Estimated costs and durations; list of milestones Predecessor activities for sequencing Code of accounts numbers for each work package Acceptance criteria
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Outputs from Create WBS (Reference Manual p. 5-15, PMBOK® Guide p. 132)
• Project Documents Updates: • Approved change requests may require updates to the requirements documentation
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Unit 5
ADDITIONAL WBS INFORMATION • The next five slides elaborate on the topic of the WBS • Topics covered include: • PMI historical concepts and “catch-phrases” • Uses of the WBS • Visual depictions of decomposition • Code of accounts
5-43
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WBS: Identifying the Work (Reference Manual pp. 5-11 to 5-15, PMBOK® Guide pp. 125-132)
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Uses of the WBS (Reference Manual pp. 5-11 to 5-15, PMBOK® Guide pp. 125-132)
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Unit 5
WBS: Scope Decomposition (Reference Manual pp. 5-11 to 5-15, PMBOK® Guide pp. 125-132)
5-46
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Unit 5
WBS Decomposition (Reference Manual pp. 5-11 to 5-15, PMBOK® Guide pp. 125-132)
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WBS Code of Accounts (Reference Manual pp. 5-11 to 5-15, PMBOK® Guide pp. 125-132)
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Unit 5
Validate Scope: Introduction (Reference Manual p. 5-15, PMBOK® Guide p. 133)
• Is part of the monitoring and controlling process group • Obtaining formal acceptance of project deliverables by stakeholders • Reviewing work results to determine whether work was completed correctly
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Unit 5
Validate Scope (Reference Manual p. 5-15, PMBOK® Guide p. 133)
Inputs
Tools
Outputs
Project management plan
Inspection
Accepted deliverables
Requirements documentation
Group decisionmaking techniques
Change requests
Requirements traceability matrix
Work performance information
Verified deliverables
Project documents updates
Work performance data
5-50
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Unit 5
Validate Scope: Key Points (Reference Manual p. 5-15 PMBOK® Guide pp. 133-134)
• If a project is terminated early, validation must document the extent of the work actually completed • Scope validation differs from quality control (QC): • Validation is primarily about acceptance • QC is primarily about correctness of the work
• Control Quality is generally performed before Validate Scope but the processes may overlap somewhat
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Unit 5
Inputs to Validate Scope (Reference Manual p. 5-16, PMBOK® Guide p. 134)
• Project management plan: Contains the scope baseline which identifies all the work that must be performed • Scope management plan: How acceptance will be obtained • Scope baseline: Scope statement (product description and acceptance criteria) and WBS (deliverables that must be accepted)
• Requirements documentation: Lists all requirements and acceptance criteria
• Requirements traceability matrix: Links requirements to their business need and tracks them
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Inputs to Validate Scope (Reference Manual p. 5-16, PMBOK® Guide p. 135)
• Verified deliverables: Work that has been completed and checked for correctness as part of Control Quality
• Work performance data. Collects the following: • Degree of compliance • Number of nonconformities • Severity of the nonconformities
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Unit 5
Tools for Validate Scope (Reference Manual p. 5-16, PMBOK® Guide p. 135)
• Inspection: Determining whether work results conform to requirements • Involves measuring, examining, and validating • Other names for inspection: reviews, product reviews, audits, and walkthroughs
• Group decision-making techniques. Provides four voting methods for reaching validation decisions: • Unanimity • Majority • Plurality • Dictatorship 5-54
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Unit 5
Outputs from Validate Scope (Reference Manual p. 5-17, PMBOK® Guide pp. 135-136)
• Accepted deliverables: • Deliverables that met the acceptance criteria and have been formally signed off • This formal documentation is forwarded to the Close Project or Phase process
• Change requests: Deliverables not accepted may require a change request for defect repair
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Unit 5
Outputs from Validate Scope (Reference Manual p. 5-17, PMBOK® Guide pp. 136)
• Work performance information: • Identifies which tasks have started and actual progress • Identifies which tasks have finished and been formally accepted
• Project documents updates: • Any documents that describe the product • Any documents that report actual status of the work
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Unit 5
Control Scope: Introduction (Reference Manual p. 5-17, PMBOK® Guide p. 136)
• Is part of the monitoring and controlling process group • Monitors the status of project and product scope by tracking variances • Also manages changes to the scope baseline by: • Following integrated change control guidelines • Ensuring proper documentation, tracking, and approval levels • Always evaluating every change request; never automatically accept or refuse a change!
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Unit 5
Control Scope (Reference Manual p. 5-18, PMBOK® Guide p. 136)
Inputs Project management plan
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Tools Variance analysis
Outputs Work performance information
Requirements documentation
Change requests
Requirements traceability matrix
Project management plan updates
Work performance data
Project documents updates
OPA
OPA updates
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Unit 5
Control Scope: Key Points (Reference Manual p. 5-17 PMBOK® Guide pp. 136-137)
• PMI states: Change is inevitable and a change control process is mandatory for all projects • The integrated change control process is the master plan for handling all changes and provides for: • Review of all change requests • Recommended preventive or corrective actions and defect repairs
• Successful control of scope changes prevents the uncontrolled expansion of project scope known as “scope creep”
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Inputs to Control Scope (Reference Manual p. 5-18, PMBOK® Guide p. 138)
• Project management plan. The following elements of the project plan assist in controlling scope: • Scope baseline: The current baseline is compared to actual results to determine if changes are needed
• Scope management plan: Directions on how scope will be monitored and controlled
• Change management plan: Defines the process for managing changes; Is part of the configuration management system
• Configuration management plan: Defines items that require formal change control and the process for controlling those changes
• Requirements management plan: Describes how requirements will be analyzed, documented, and managed
• Requirements documentation: Requirements should be measureable, testable, traceable, complete, consistent, and acceptable to stakeholders 5-60
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Inputs to Control Scope (Reference Manual p. 5-18, PMBOK® Guide p. 138)
• Requirements traceability matrix: Useful in understanding the potential effect of requirements changes upon business needs
• Work performance data. Tracks the following: • Number of change requests received • Number of change requests accepted • Number of deliverables completed
• OPA: • Procedures, policies, and guidelines • Monitoring and reporting methods
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Unit 5
Tools for Control Scope (Reference Manual p. 5-19, PMBOK® Guide p. 139)
• Variance analysis: • Assesses the magnitude of variations from the scope baseline • Determines whether corrective action is necessary
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Unit 5
Outputs from Control Scope (Reference Manual p. 5-19, PMBOK® Guide p. 139)
• Work performance information: Tracking of: • Scope variances and scope changes • Forecasts of future scope outcomes
• Change requests: Requested scope changes should be processed using integrated change control • Change requests are often the result of: External event such as a regulatory change Error in defining scope (left something out) Value adding change (value analysis or value engineering)
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Unit 5
Outputs from Control Scope (Reference Manual p. 5-19, PMBOK® Guide p. 140)
• Project Management Plan Updates: Approved changes may require updates to the scope, schedule, or cost baselines
• Project Documents Updates: Includes possible updates to the requirements documentation or requirements traceability matrix
• OPA Updates. Updates to the historical knowledge base: • Causes of variances • Corrective actions employed • Any other lessons learned
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Unit 5
Other Topics (Reference Manual p. 5-19, PMBOK® Guide No Reference)
• Other Topics covers information known to be on the real exam but not addressed by the PMBOK® Guide: • There are no Other Topics in this Unit!
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Unit 5
Drill Practice Reminder
Drill practice for this chapter starts on p. 5-21
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Unit 6
TIME MANAGEMENT
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Unit 6
Time Management Concept (Reference Manual p. 6-1, PMBOK® Guide p. 141)
• Time management includes the processes for managing timely completion of the project • Overview of 7 processes: • Plan Schedule Management • Define Activities • Sequence Activities • Estimate Activity Resources • Estimate Activity Durations • Develop Schedule • Control Schedule 6-2
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Unit 6
Time Management: Key Points (Reference Manual p. 6-1, PMBOK® Guide pp. 141-142)
• A schedule model is a representation of the plan for executing project activities and includes: • Durations and dependencies • Other planning information (e.g. resources)
• Schedule data are the detailed information contained in the schedule model • The schedule baseline is the approved version of a schedule model and is the basis for comparing actual results • You must know how to evaluate a schedule: forward and backward pass, float, critical path, schedule compression, etc.
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Unit 6
Overview of Topics in Unit 6 • Time Management Processes • Other Topics • Information that has been tested but is not covered by the PMBOK® Guide.
• Drill Practice • Self-Study Network Diagrams
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Unit 6
Overview of Time Management Processes (Reference Manual p. 6-1, PMBOK® Guide p. 141)
6.1 Plan Schedule Management (establishing procedures for planning, developing, managing, executing, and controlling the schedule)
6.2 Define Activities (identifying specific activities to be accomplished) 6.3 Sequence Activities (identifying and documenting relationships among activities, i.e., dependencies)
6.4 Estimate Activity Resources (estimating type and quantity of resources needed)
6.5 Estimate Activity Durations (approximating the number of work periods to complete individual activities with estimated resources)
6.6 Develop Schedule (analyzing sequences, resource requirements, durations, and schedule constraints to create the schedule)
6.7 Control Schedule (monitoring the status of the project and managing changes to the schedule baseline) 6-5
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Unit 6
Selected Knowledge Area, Process Groups, and Processes (Reference Manual p. 3-7, PMBOK® Guide pp. 60-61)
Process Groups Knowledge Areas
Initiating
Planning
Executing
Controlling
Closing
Integration Scope • • • • • •
Time
Plan schedule mgmt Define activities Sequence activities Estimate resources Estimate durations Develop schedule
• Control schedule
Cost Quality HR Communication Risk Procurement Stakeholder 6-6
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Unit 6
Plan Schedule Management: Introduction (Reference Manual p. 6-1, PMBOK® Guide p. 145)
• Is part of the planning process group • Results in a schedule management plan which: • Documents how the schedule will be planned, developed, managed, executed, and controlled • Plans the approach for accomplishing the remaining 6 processes: Define activities Sequence activities Estimate activity resources Estimate activity durations Develop schedule Control schedule 6-7
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Unit 6
Plan Schedule Management (Reference Manual p. 6-1, PMBOK® Guide p. 145)
Inputs
Tools
Project management plan
Expert judgment
Project charter
Analytical techniques
EEF
Meetings
Outputs Schedule management plan
OPA
Note: EEF = Enterprise Environmental Factors OPA = Organizational Process Assets 6-8
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Unit 6
Inputs to Plan Schedule Management (Reference Manual p. 6-2, PMBOK® Guide p. 146)
• Project management plan: Contains the following— •
Scope baseline: The scope statement and WBS may be used for defining activities, estimating durations, and managing the schedule
•
Other information: Cost and risk information that may affect the schedule
• Project charter: Provides a high-level, summary milestone schedule • EEF/OPA: Factors that influence success, standard procedures, templates, historical information, and lessons learned
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Unit 6
Tools for Plan Schedule Management (Reference Manual p. 6-2, PMBOK® Guide p. 147)
• Expert judgment: • Applying expert judgment combined with historical information to select appropriate scheduling methods
• Analytical techniques: Assessing— • Appropriate scheduling methods • Whether to use project management software • Whether to employ fast tracking and/or crashing
• Meetings: • Selected stakeholders who attend meetings to develop the schedule management plan 6-10
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Unit 6
Outputs from Plan Schedule Management (Reference Manual p. 6-3, PMBOK® Guide p. 148)
• Schedule management plan: Describes how the schedule will be developed, monitored, and controlled. Includes— • Schedule model: Chooses scheduling method • Acceptable accuracy: For duration estimates • Units of measure: How to track time (hours, days, …) or materials (liters, tons, …) • Schedule maintenance: How to update schedule status • Control thresholds: How much schedule variance is normal vs. when do you need corrective action • Performance measurement: Rules for partially completed tasks when doing a status report • Reporting formats: Formats and frequency for reporting 6-11
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Unit 6
Define Activities: Introduction (Reference Manual p. 6-3, PMBOK® Guide p. 149)
• Is part of the planning process group • Identifies and documents specific activities that must be accomplished to complete the project • Activities are decomposed to the work package level • Work packages are the lowest level displayed in the WBS • However, work packages may be decomposed into smaller components called activities: • Activities represent the more discrete work effort to accomplish deliverables within a work package
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Unit 6
Define Activities (Reference Manual p. 6-4, PMBOK® Guide p. 149)
Inputs
Tools
Outputs
Schedule management plan
Decomposition
Activity list
Scope baseline
Rolling wave planning
Activity attributes
EEF
Expert judgment
Milestone list
OPA
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Unit 6
Inputs to Define Activities (Reference Manual p. 6-4, PMBOK® Guide p. 150)
• Schedule management plan: Prescribes the level of detail needed to manage the work
• Scope baseline: Contains the WBS and its deliverables; also provides constraints and assumptions from the scope statement
• EEF: Organizational culture, commercially available databases, and project management information system
• OPA: Activity lists from previous projects, lessons learned, standard scheduling processes
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Unit 6
Tools for Define Activities (Reference Manual pp. 6-4 and 5, PMBOK® Guide p. 151)
• Decomposition: As with the WBS, breaking work into smaller components • Work packages are decomposed into the activities needed to produce individual deliverables • Involving the team leads to more accurate results
• Rolling wave planning: Using progressive elaboration • Work in the near term: Planned in detail using work packages • Work farther in the future: Planned with less detail and less accuracy using planning packages
• Expert judgment: Using experts to ensure the activity list is accurate
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Unit 6
Outputs from Define Activities (Reference Manual p. 6-5, PMBOK® Guide p. 152)
• Activity list: A comprehensive list of all activities, even those below the work package level • Should include a description of the work • May also include an activity title and code of accounts number
• Activity attributes: Similar to the WBS dictionary, includes details for each activity • Activity ID, WBS ID, activity title, activity description • Predecessor and successor activities, type of dependency • Leads and lags, resource requirements • Imposed dates, constraints, assumptions • Assigned resources, geographical location 6-16
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Unit 6
Outputs from Define Activities (Reference Manual p. 6-5, PMBOK® Guide p. 152)
• Milestone list: A list of important points in time when work should have started or finished • Milestones have zero duration • Tracking of specified milestones may be requested by any stakeholder • A milestone chart is an excellent way to display a high-level schedule to customers and/or management
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Unit 6
Sequence Activities: Introduction (Reference Manual p. 6-6, PMBOK® Guide p. 153)
• Is part of the planning process group • Identifies and documents interactivity dependencies • Dependencies are also called logical relationships • Shows the logical sequence for performing the work: • Some work is planned sequentially: Task 1 and then Task 2 • Parts of the work may be done in parallel (fast tracking)
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Unit 6
Sequence Activities (Reference Manual p. 6-6, PMBOK® Guide p. 153)
Inputs
Tools
Outputs
Schedule management plan
Precedence diagramming method (PDM)
Project schedule network diagrams
Activity list
Dependency determination
Project documents updates
Activity attributes
Leads and lags
Milestone list Project scope statement EEF OPA
6-19
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Unit 6
Sequence Activities: Key Points (Reference Manual p. 6-6 and 6-9 PMBOK® Guide pp. 120-121)
• Except for the first and last, all activities must have a predecessor and a successor No hanging tasks! • Leads and lags may be incorporated to make the schedule more realistic • Sequencing may be done manually or with software
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Unit 6
Inputs to Sequence Activities (Reference Manual p. 6-6, PMBOK® Guide p. 154)
• Schedule management plan: Identifies the intended scheduling method
• Activity list: Identifies all activities that must be sequenced • Activity attributes: Includes predecessors and successors for each activity
• Milestone list: Milestones must also be sequenced and may have imposed dates in some instances
• Project scope statement: Describes product characteristics which may indicate that certain dependencies would be mandatory
• EEF: Industry standards, information system, scheduling tool • OPA: Historical files and scheduling templates 6-21
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Unit 6
Tools for Sequence Activities (Reference Manual p. 6-7, PMBOK® Guide p. 156)
• Precedence diagramming method (PDM): A method for displaying a schedule as a network diagram • Also called activity-on-node; was developed in the 1960s at Stanford University • Activity listed inside boxes (nodes) and connected with lines or arrows to show sequencing Design
Test
Produce
• Uses four types of dependencies (next slide)
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Unit 6
Tools for Sequence Activities (Reference Manual p. 6-7, PMBOK® Guide p. 156)
• PDM continued: • Four types of dependencies: Finish-to-Start: Start of the successor depends on finish of the predecessor
Start-to-Start: Start of the successor depends on start of the predecessor
Finish-to-Finish: Finish of the successor depends on finish of the predecessor
Start-to-Finish: Finish of the successor depends on start of the predecessor
Note: The next four slides show visual examples
6-23
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Unit 6
PDM: Finish-to-Start (Reference Manual p. 6-7, PMBOK® Guide p. 156)
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Unit 6
PDM: Start-to-Start (Reference Manual p. 6-7, PMBOK® Guide p. 156)
6-25
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Unit 6
PDM: Finish-to-Finish (Reference Manual p. 6-7, PMBOK® Guide p. 156)
6-26
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Unit 6
PDM: Start-to-Finish (Reference Manual p. 6-7, PMBOK® Guide p. 156)
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Unit 6
Advantages of PDM (Reference Manual p. 6-8, PMBOK® Guide No Reference)
• Flexibility in sequencing: • Can choose from four types of dependencies • Arrow diagrams were limited to one type (Finish-to-Start)
• Does not require “dummy” activities • Added the concept of lag and lead times
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Unit 6
Tools for Sequence Activities (continued) (Reference Manual p. 6-8, PMBOK® Guide pp. 157-159 )
• Dependency determination: • Mandatory: “Hard logic” involving work with physical limitations such that the work must be done in sequence • Discretionary: “Soft logic” or preferential logic in which there is more than one possible sequence • External: Work performed outside the project team; outside the direct control of the team • Internal: Work within the direct control of the team
• Leads and lags: Adjusts the timing of the work • Lead: Allows the successor activity to be accelerated • Lag: Delays the successor activity 6-29
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Unit 6
Outputs from Sequence Activities (Reference Manual p. 6-9, PMBOK® Guide p. 159)
• Project schedule network diagrams: A schematic display of project activities • The display shows logical dependencies • PDM is the most common display method • Arrow diagrams were removed from the PMBOK® Guide but have still appeared on the exam
• Project documents updates: • Activity lists and attributes • Milestone list and risk register
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Unit 6
PDMs and Network Diagrams: Additional Information (Reference Manual pp. 6-7 to 6-9, PMBOK® Guide pp. 156-159)
• The next series of slides elaborates on the topics of PDM displays and network diagrams • Topics covered include: • Arrow diagrams (ADM: Arrow Diagram Method) • PDM basics • PDM: Forward pass, backward pass, float, critical path • PDM: Free float, most float, least float • Leads and lags • Sample diagram with multiple types of dependencies 6-31
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Unit 6
Arrow Diagrams with Multiple Dependencies (Reference Manual pp. 6-7 to 6-9, PMBOK® Guide pp. 156-159)
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Unit 6
Arrow Diagrams with Multiple Dependencies (Reference Manual pp. 6-7 to 6-9, PMBOK® Guide pp. 156-159)
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PDM Does Not Require Dummy Task (Reference Manual pp. 6-7 to 6-9, PMBOK® Guide pp. 156-159)
6-34
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Unit 6
Scheduling Using PDM Approach (Reference Manual pp. 6-7 to 6-9, PMBOK® Guide pp. 156-159)
6-35
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Unit 6
PDM: Forward Pass (Reference Manual pp. 6-7 to 6-9, PMBOK® Guide pp. 156-159)
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Unit 6
PDM: Backward Pass (Reference Manual pp. 6-7 to 6-9, PMBOK® Guide pp. 156-159)
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Unit 6
PDM: Calculating Float and Marking Critical Path (Reference Manual pp. 6-7 to 6-9, PMBOK® Guide pp. 156-159)
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Unit 6
PDM: Effect of an Additional Dependency (C-E) (Reference Manual pp. 6-7 to 6-9, PMBOK® Guide pp. 156-159)
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Unit 6
Sample Questions on Float (Reference Manual pp. 6-7 to 6-9, PMBOK® Guide pp. 156-159)
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Unit 6
Float Calculation Continued (Reference Manual pp. 6-7 to 6-9, PMBOK® Guide pp. 156-159)
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Unit 6
Float Depicted on a Numerical Scale (Reference Manual pp. 6-7 to 6-9, PMBOK® Guide pp. 156-159)
6-42
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Unit 6
Leads and Lags: A Tool of Sequence Activities (Reference Manual pp. 6-7 to 6-9, PMBOK® Guide pp. 156-159)
6-43
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Unit 6
Sample Network: Finish-to-Finish, Start-to-Start, Lag (Reference Manual pp. 6-7 to 6-9, PMBOK® Guide pp. 156-159)
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Unit 6
Sample Network: Finish-to-Finish, Start-to-Start, Lag (Reference Manual pp. 6-7 to 6-9, PMBOK® Guide pp. 156-159)
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Unit 6
Scheduling Definitions (Reference Manual pp. 6-7 to 6-9, PMBOK® Guide Glossary pp. 526-567)
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Unit 6
Estimate Activity Resources: Introduction (Reference Manual p. 6-9, PMBOK® Guide p. 160)
• Is part of the planning process group • Determines what resources will be needed: • People • Equipment • Materials • Facilities • Resource estimates also apply to cost estimating
6-47
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Unit 6
Estimate Activity Resources (Reference Manual p. 6-9, PMBOK® Guide p. 161)
Inputs
Tools
Outputs
Schedule management plan
Expert judgment
Activity resource requirements
Activity list
Alternative analysis
Resource breakdown structure (RBS)
Activity attributes
Published estimating data
Project documents updates
Resource calendars
Bottom-up estimating
Risk register
Project management software
Activity cost estimates EEF OPA 6-48
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Unit 6
Inputs to Estimate Activity Resources (Reference Manual p. 6-9, PMBOK® Guide p. 162)
• Schedule management plan: Specifies desired level of accuracy and units of measure for resources needed
• Activity list: Identifies activities which will require resources • Activity attributes: Developed previously for Define Activities; this is primary data for estimating resources
• Resource calendars: Identifies the typical working schedule for the organization and addresses the following • Time periods in which a given resource is available • Experience level or capability of a resource • Geographical location of a given resource
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Unit 6
Inputs to Estimate Activity Resources (Reference Manual p. 6-9, PMBOK® Guide p. 162)
• Risk register: Risk events may affect resource availability, i.e., a union contract may be up for renewal
• Activity cost estimates: Some resources may be more expensive; relative cost may affect resource selection
• EEF: Resource infrastructure currently available in-house • OPA: • Staffing policies • Procedures for purchasing supplies and equipment • Historical information about resource usage on similar projects
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Unit 6
Tools for Estimate Activity Resources (Reference Manual p. 6-10, PMBOK® Guide p. 164)
• Expert judgment: Experts who help judge the completeness and accuracy of resource estimates
• Alternative analysis: Required resources may be affected by the various alternative methods of doing the work
• Published estimating data: Some organizations publish data on cost of resources and typical durations for performing work
• Bottom-Up estimating: Decomposing work into smaller components if resource estimating proves difficult at the higher level
• Project management software: Organizing resource data by defining • Resource availability and labor rates • Resource calendars and resource breakdown structures (RBS) 6-51
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Unit 6
Outputs from Estimate Activity Resources (Reference Manual p. 6-11, PMBOK® Guide p. 165)
• Activity resource requirements: Type and quantity of resources needed for each activity. Should include— • Basis of the estimate (method used) • Any assumptions • Resource availability and quantity needed
• Resource breakdown structure (RBS): Tracks work assignments for specific individuals • Determines whether a resource is available when needed • The RBS tracks time periods in which a resource already has task assignments
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Outputs from Estimate Activity Resources (Reference Manual p. 6-11, PMBOK® Guide p. 165)
• Project Documents Updates: • Activity list and attributes • Resource calendars
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Unit 6
Estimate Activity Durations: Introduction (Reference Manual p. 6-12, PMBOK® Guide p. 165)
• Is part of the planning process group • Assessing the number of work periods needed to complete an activity • Accurate duration estimating supports the development of a realistic schedule
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Unit 6
Estimate Activity Durations (Reference Manual p. 6-12, PMBOK® Guide p. 166)
Inputs
Tools
Outputs
Schedule management plan
Expert judgment
Activity duration estimates
Activity list
Analogous estimating
Project documents updates
Activity attributes
Parametric estimating
Activity resource requirements
Three-point estimating
Resource calendars
Group decision-making techniques
Project scope statement
Reserve analysis
Risk register Resource breakdown structure EEF OPA 6-55
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Unit 6
Estimate Activity Durations: Key Points (Reference Manual p. 6-12 PMBOK® Guide pp. 165-167)
• Duration estimates should be: • Progressively elaborated (become more accurate as the project progresses) • Adjusted for “elapsed time”: Addresses whether weekends are official work periods
• Duration estimates should consider the difference between effort and duration: • Effort: If three people work ten hours each on a task, you must pay for 30 hours of work. Effort affects cost estimating. • Duration: If those three people are working simultaneously, the duration of the task would be ten hours. Duration affects schedules. 6-56
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Unit 6
Inputs to Estimate Activity Durations (Reference Manual p. 6-13, PMBOK® Guide p. 167)
• Schedule management plan: Defines the estimating method and desired level of accuracy
• Activity list: Durations must be estimated for each activity • Activity attributes: Developed previously and provides data to assist in estimating durations
• Activity resource requirements: Durations are clearly affected by the number of resources assigned
• Resource calendars: Identify the availability and capability of all required resources
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Unit 6
Inputs to Estimate Activity Durations (Reference Manual p. 6-13, PMBOK® Guide p. 167)
• Project scope statement: Documents constraints and assumptions that may affect durations • Constraint: A stakeholder may have imposed a deadline for a key task • Assumption: You may plan on the assumption that the new union contract will be signed and resources will be available on time
• Risk register: Provides a list of known risk events • RBS: Identifies resources by category (labor, materials, …)
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Inputs to Estimate Activity Durations (Reference Manual p. 6-13, PMBOK® Guide p. 167)
• EEF: • Duration estimating databases • Productivity metrics • Published commercial information
• OPA: • Historical information and lessons learned • Project calendars • Scheduling methodology
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Unit 6
Tools for Estimate Activity Durations (Reference Manual p. 6-14, PMBOK® Guide p. 169)
• Expert judgment: The use of expert judgment guided by historical information
• Analogous estimating: A form of top-down estimating • Uses actual durations from similar activities • Adjusts for differences in size, complexity, and risk • Done early in the project life cycle (initiating) • Not costly to develop but also less accurate
• Parametric estimating: Uses historical data • Example: you might discover that a drawing historically takes 10 hours • Then you only need to know how many drawings are needed 6-60
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Unit 6
Tools for Estimate Activity Durations (Reference Manual p. 6-14, PMBOK® Guide p. 169)
• Three-point estimating: Improves accuracy by considering risk • Uses three estimates and calculates an average • Optimistic: The best-case outcome • Most Likely: The most likely outcome • Pessimistic: The worst-case outcome • Three-point is similar to PERT; comparisons are covered later
• Group decision-making techniques: PMI believes teams can produce more accurate estimates; teaming also leads to increased commitment to the results
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Unit 6
Tools for Estimate Activity Durations (Reference Manual p. 6-14, PMBOK® Guide p. 169)
• Reserve analysis: Reserves are added to duration estimates to account for risk • Contingency reserve: Extra time allocated within the schedule baseline Associated with known-unknowns Certain work packages are known to be risky • Management reserve: Extra time withheld from the schedule baseline Associated with unknown-unknowns Difficult to predict which work will be affected by the risk event 6-62
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Unit 6
Outputs from Estimate Activity Durations (Reference Manual p. 6-15, PMBOK® Guide p. 172)
• Activity duration estimates: Number of work periods needed to complete activities and, by extension, the project • PMI recommends that duration estimates include a range of possible results • Estimates with wider ranges indicate work with inherently more risk (the results are less predictable or stable)
• Project documents updates: • Activity attributes • Assumptions associated with durations
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Unit 6
Develop Schedule: Introduction (Reference Manual p. 6-16, PMBOK® Guide p. 172)
• Is part of the planning process group • Builds upon previous processes to produce a project schedule • The approved schedule becomes the schedule baseline: • The baseline is used to track actual progress and calculate schedule variances
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Unit 6
Develop Schedule (Reference Manual p. 6-16, PMBOK® Guide p. 173)
Inputs
Tools
Outputs
Schedule management plan
Schedule network analysis
Schedule baseline
Activity list
Critical path method
Project schedule
Activity attributes
Critical chain method
Schedule data
Project schedule network diagrams
Resource optimization techniques
Project calendars
Activity resource requirements
Modeling techniques
Project management plan updates
Resource calendars
Leads and lags
Project documents updates
Activity duration estimates
Schedule compression
Project scope statement
Scheduling tool
Risk register Project staff assignments Resource breakdown structure EEF OPA 6-65
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Unit 6
Develop Schedule: Key Points (Reference Manual p. 6-16 PMBOK® Guide pp. 172-174)
• A schedule exists when every activity has a planned start and finish • Once approved, a schedule becomes a baseline: • Resource availability to support the planned schedule must be verified • The schedule baseline is used to track variances and may only be changed using the integrated change control process
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Unit 6
Inputs to Develop Schedule (Reference Manual p. 6-16, PMBOK® Guide pp. 174-175)
• Schedule management plan: Identifies the scheduling method • Critical path method or critical chain method or simulation…
• Activity list: Identifies each activity that must be scheduled • Activity attributes: Provides the details for each activity • Project schedule network diagrams: Shows the intended sequencing
• Activity resource requirements: Identifies types and quantities of resources needed
• Resource calendars: Availability and capability of resources 6-67
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Unit 6
Inputs to Develop Schedule (Reference Manual p. 6-17, PMBOK® Guide p. 175)
• Activity duration estimates: The number of work periods needed to complete activities
• Project scope statement: Documents any constraints or assumptions that may affect the schedule, e.g. • Dates imposed by the customer, upper management, or other stakeholders • Key events that have been promised or demanded by a certain date
• Risk register: Risk events that may affect the schedule
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Unit 6
Inputs to Develop Schedule (Reference Manual pp. 6-17 & 18, PMBOK® Guide pp. 175-176)
• Project staff assignments: Documents which resources have been assigned to each activity
• Resource breakdown structure: Documents how resource availability is affecting the schedule
• EEF: • Communication channels and standards • Scheduling tool to be used
• OPA: • Scheduling methodology • Project calendar 6-69
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Unit 6
Tools for Develop Schedule (Reference Manual p. 6-18, PMBOK® Guide p. 176)
• Schedule network analysis: Choosing from various scheduling techniques • Critical path method • Critical chain method • What-if analysis (simulation) • Resource optimization (resource leveling and smoothing) • Schedule compression
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Unit 6
Tools for Develop Schedule (Reference Manual p. 6-18, PMBOK® Guide pp. 176-177)
• Critical path method (CPM): Estimates the minimum required project duration and determines the amount of scheduling flexibility • Uses forward and backward pass to determine early and late times • Calculates available float or slack (schedule flexibility) • Determines the critical path Longest path (shows shortest possible duration) Path with zero float Path with least float available Negative float on critical path indicates: Behind schedule Positive float on critical path indicates: Ahead of schedule 6-71
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Unit 6
Tools for Develop Schedule (Reference Manual p. 6-18, PMBOK® Guide pp. 176-177)
• Critical path method (CPM): Additional key points about the critical path • Multiple critical paths may exist; would make the schedule more risky • A near-critical path exists when the duration of a path is almost as long • Near-critical paths must also be monitored carefully • Subsequent slides will compare CPM and PERT
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Unit 6
Tools for Develop Schedule (Reference Manual pp. 6-18 & 19, PMBOK® Guide p. 178)
• Critical chain method: Manages the schedule by monitoring duration buffers instead of float and the critical path • Determine the critical path • Apply resource limitations • The resource-constrained critical path is known as the critical chain • Schedule all activities to late start (what happened to float?) • Apply duration buffers to account for limited resources and uncertainty with the work • The size of the buffer reflects the uncertainty for that sequence of activities
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Unit 6
Tools for Develop Schedule (Reference Manual p. 6-19, PMBOK® Guide pp. 179-180)
• Resource optimization: Adjusting the schedule when resource demand does not match resource supply • Resource leveling: Used when supply of resources is inadequate When there are not enough resources for the work scheduled, move tasks with available positive float Tends to result in a longer project duration than planned • Resource smoothing: Adjusting start times to ensure that resource usage does not exceed pre-defined limits You must operate within available float The critical path is not allowed to change It may not be possible to optimize all resources 6-74
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Unit 6
Tools for Develop Schedule (Reference Manual pp. 6-19 & 20, PMBOK® Guide p. 180)
• Modeling techniques: Two related, classic techniques follow • What-If Scenario Analysis: Compares the potential effect of differing project conditions (e.g., hurricane, labor strike, blizzard, etc.) Helps with risk assessment and evaluating feasibility of the planned schedule Often used in conjunction with simulations • Simulation: Calculates numerous potential project durations with associated probabilities Again, helps with risk assessment and feasibility Uses software programs such as Risk+, Crystal Ball, etc. 6-75
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Unit 6
Tools for Develop Schedule (Reference Manual p. 6-20, PMBOK® Guide p. 181)
• Leads and lags: Used to adjust the timing of the work to account for delays or accelerations
• Schedule compression: Ways to shorten the schedule • Crashing: Adds resources to critical path activities to shorten durations; raises project costs • Fast tracking: Doing more activities in parallel; increases risk of overlapping (conflicting) resource assignments
• Scheduling tool: The use of automated scheduling tools • Makes it easier to produce a schedule and track changes 6-76
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Unit 6
Tools for Develop Schedule: Additional Information (Reference Manual pp. 6-18 to 6-20, PMBOK® Guide pp. 176-181)
• The next series of slides elaborates on the tools involved in developing the schedule • Topics covered include: • Comparison of three-point estimates, CPM, and PERT • Crashing • Fast-tracking
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Unit 6
Three-Point vs. PERT Estimates (Reference Manual pp. 6-18 to 6-20, PMBOK® Guide pp. 176-181)
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CPM vs. PERT vs. Three-Point (Reference Manual pp. 6-18 to 6-20, PMBOK® Guide pp. 176-181)
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CPM vs. PERT (Reference Manual pp. 6-18 to 6-20, PMBOK® Guide pp. 176-181)
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Unit 6
Schedule Compression: Crashing vs. Fast Tracking (Reference Manual pp. 6-18 to 6-20, PMBOK® Guide pp. 176-181)
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Unit 6
Exercise: Crashing the Project (Reference Manual pp. 6-18 to 6-20, PMBOK® Guide pp. 176-181)
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Unit 6
Exercise: Crashing the Project (Reference Manual pp. 6-18 to 6-20, PMBOK® Guide pp. 176-181)
Find critical path and lowest cost crashable tasks!
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Unit 6
Exercise: Crashing the Project (Reference Manual pp. 6-18 to 6-20, PMBOK® Guide pp. 176-181)
Find cheapest way to reduce the longest path!
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Unit 6
Exercise: Crashing the Project (Reference Manual pp. 6-18 to 6-20, PMBOK® Guide pp. 176-181)
Ensure no path exceeds the new goal of 5 days!
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Unit 6
Outputs from Develop Schedule (Reference Manual p. 6-20, PMBOK® Guide p. 181)
• Schedule baseline: The approved schedule becomes the baseline • Actual performance is measured against the baseline • The baseline should only be changed using formal change control procedures
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Unit 6
Outputs from Develop Schedule (Reference Manual pp. 6-20 &21, PMBOK® Guide p. 182)
• Project schedule: The schedule may be presented in several ways • Project schedule network diagrams: Is the best display to see dependencies and the critical path • Gantt charts (referred to as bar charts by PMI): Easy to read and preferred as a presentation method Best display to see progress and variances A summary level view may use hammock activities • Milestone charts: A milestone is an important event with zero duration An excellent way to communicate high-level schedule status to customers and upper management
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Unit 6
Outputs from Develop Schedule (Reference Manual p. 6-21, PMBOK® Guide p. 184)
• Schedule data: Detailed data that support the schedule • Activities and attributes, milestones, assumptions, constraints • Resource requirements • Alternative schedules • Contingency reserves for risk
• Project calendars: The working calendar for the project • The default calendar in most software is Monday to Friday, 8 am to 5 pm
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Unit 6
Outputs from Develop Schedule (Reference Manual pp. 6-21 & 22, PMBOK® Guide pp. 184-185)
• Project Management Plan Updates: • Schedule baseline • Schedule management plan
• Project Documents Updates: • Activity resource requirements • Activity attributes (resources, durations, risks, etc.) • Project calendar • Risk register
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Unit 6
Control Schedule: Introduction (Reference Manual p. 6-22, PMBOK® Guide pp. 185-186)
• Is part of the monitoring and controlling process group • Involves monitoring schedule status (variances) and managing schedule changes • Again, the schedule baseline may only be changed using the Perform Integrated Change Control process • Control Schedule supports the Integrated Change Control process by: • Determining the current status of the schedule • Influencing factors that create schedule changes • Determining that schedule changes have occurred • Managing those schedule changes 6-90
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Unit 6
Control Schedule (Reference Manual p. 6-22, PMBOK® Guide p. 185)
Inputs
Tools
Outputs
Project management plan
Performance reviews
Work performance information
Project schedule
Project management software
Schedule forecasts
Work performance data
Resource optimization techniques
Change requests
Project calendars
Modeling techniques
Project management plan updates
Schedule data
Leads and lags
Project documents updates
OPA
Schedule compression
OPA updates
Scheduling tool
6-91
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Unit 6
Inputs to Control Schedule (Reference Manual pp. 6-22 & 23 PMBOK® Guide pp. 187-188)
• Project management plan: Contains the schedule management plan and schedule baseline • The baseline is compared to actual outcomes to determine if a change, preventive action, or corrective action is needed
• Project schedule: The approved schedule is the baseline; it is this baseline that changes if schedule changes are approved
• Work performance data: Information about actual progress (which activities actually started, actual duration, percent complete)
• Project calendars: Identifies time periods available for completing work
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Unit 6
Inputs to Control Schedule (Reference Manual p. 6-23 PMBOK® Guide p. 188)
• Schedule data: Data that have been interpreted and show the status of the work
• OPA: • Policies for controlling schedule changes and making decisions about corrective action and preventive action • Schedule control tools • Reporting methods
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Unit 6
Tools for Control Schedule (Reference Manual pp. 6-23 & 24, PMBOK® Guide pp. 188-190)
• Performance reviews: Comparing planned vs. actual performance data. Various techniques may be used to analyze this data • Trend analysis • Critical path method • Critical chain method • Earned value management • Note: Variance = Plan-Actual
• Project management software: Provides automated means to track performance
• Resource optimization techniques: Optimizes the application of resources to the work that must be done • Leveling and smoothing 6-94
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Unit 6
Tools for Control Schedule (Reference Manual p. 6-24, PMBOK® Guide pp. 189-190)
• Modeling techniques: Using what-if analysis and simulation to analyze the probability of certain schedule outcomes
• Leads and lags: Bringing the schedule back in line with the plan by delaying or accelerating the work
• Schedule compression: Realigning schedule performance with the plan using crashing and/or fast tracking
• Scheduling tool: Producing an updated schedule using manual or automated means
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Unit 6
Outputs from Control Schedule (Reference Manual p. 6-24, PMBOK® Guide p. 190)
• Work performance information: Communicating schedule variance and schedule performance index to stakeholders
• Schedule forecasts: Predicting schedule outcomes based on the status revealed using work performance information
• Change requests: Change requests may arise from analysis of schedule variances; they should be processed using integrated change control
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Unit 6
Outputs from Control Schedule (Reference Manual p. 6-25, PMBOK® Guide pp. 191-192)
• Project Management Plan Updates: • Schedule baseline • Cost baseline if incur additional costs compressing the schedule
• Project Documents Updates: • Risk register
• OPA Updates: New lessons learned that must be added to the OPA knowledge base • Causes of variances • Corrective actions chosen • Other lessons learned about controlling the schedule 6-97
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Unit 6
Other Topics (Reference Manual p. 6-25, PMBOK® Guide No Reference)
• Other Topics covers information known to be on the real exam but not addressed by the PMBOK® Guide: • Monte Carlo analysis compared to CPM and PERT • GERT (Graphical Evaluation and Review Technique)
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Unit 6
Monte Carlo Analysis Compared to CPM and PERT (Reference Manual p. 6-25, PMBOK® Guide No Reference)
• CPM and PERT tend to understate durations compared to Monte Carlo • Monte Carlo can account for path convergence; CPM and PERT are not as statistically sophisticated and cannot take as many factors into account
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Unit 6
Monte Carlo Analysis Compared to CPM and PERT (Reference Manual p. 6-25, PMBOK® Guide No Reference)
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Unit 6
GERT (Reference Manual p. 6-25, PMBOK® Guide No Reference)
• A sophisticated schedule development tool that can account for: • Loops (Activities that occur more than once in an iterative fashion) • Conditional branches (Activities that occur only if something else happens first; If-Then logic)
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Unit 6
Drill Practice Reminder
Drill practice for this chapter starts on p. 6-27
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Unit 6
Self-Study: Additional Review of Scheduling Concepts • See Unit 15, Reference Manual for additional practice with network diagrams, including: • Review of the differences between PDM, Arrow diagram, and Gantt charts • Practice network diagrams with solutions • Practice crashing problems with solutions
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Unit 7
COST MANAGEMENT
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Unit 7
Cost Management Concept (Reference Manual p. 7-1, PMBOK® Guide p. 193)
• Cost management includes the processes for managing and controlling costs so that the project can completed within the approved budget • Overview of 4 processes: • Plan Cost Management • Estimate Costs • Determine Budget • Control Costs
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Unit 7
Cost Management: Key Points (Reference Manual p. 7-1, PMBOK® Guide pp. 193-195)
• The ability to influence cost is greatest during the early stages of a project: • Therefore, early scope definition is crucial • Various stakeholders will measure costs at different times: When the acquisition decision is made When the order is placed When the item is delivered When financial accounting of the expense occurs
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Unit 7
Cost Management: Key Points (Reference Manual p. 7-1, PMBOK® Guide pp. 193-195)
• PMI endorses the concept of life cycle cost; also called the total cost of ownership • Life cycle cost includes the following components: • Project (or acquisition) costs • Operating and maintenance costs incurred by the user • Disposal costs (safe and environmentally responsible)
• Conclusion: Do not reduce project costs at the expense of high operating and maintenance costs
7-4
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Unit 7
Overview of Topics in Unit 7 • Cost Management Processes • Other Topics • Information that has been tested but is not covered by the PMBOK® Guide.
• Cost Exercise • Drill Practice • Math for the PMP Exam
7-5
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Unit 7
Overview of Cost Management Processes (Reference Manual p. 7-1, PMBOK® Guide p. 193)
7.1 Plan Cost Management (establishing procedures for planning, managing, expending, and controlling costs)
7.2 Estimate Costs (estimating the total cost of all project activities) 7.3 Determine Budget (aggregating estimated costs to establish a cost baseline)
7.4 Control Costs (monitoring cost status and controlling changes to the cost baseline)
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Unit 7
Selected Knowledge Area, Process Groups, and Processes (Reference Manual p. 3-7, PMBOK® Guide pp. 60-61)
Process Groups Knowledge Areas
Initiating
Planning
Executing
Controlling
Closing
Integration Scope Time • Plan cost management • Estimate costs • Determine budget
Cost
• Control costs
Quality HR Communication Risk Procurement Stakeholder
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Unit 7
Plan Cost Management: Introduction (Reference Manual p. 7-2, PMBOK® Guide p. 195)
• Is part of the planning process group • Results in a cost management plan which: • Establishes procedures for planning, managing, expending, and controlling project costs • Plans the approach for accomplishing the remaining 3 processes: Estimate costs Determine budget Control costs
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Unit 7
Plan Cost Management (Reference Manual p. 7-2, PMBOK® Guide p. 195)
Inputs
Tools
Project management plan
Expert judgment
Project charter
Analytical techniques
EEF
Meetings
Outputs Cost management plan
OPA
Note: EEF = Enterprise Environmental Factors OPA = Organizational Process Assets 7-9
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Unit 7
Inputs to Plan Cost Management (Reference Manual p. 7-2, PMBOK® Guide p. 196)
• Project management plan: Contains the following— • Scope baseline: Contains the scope statement and WBS details for cost estimating
• Schedule baseline: Defines when costs will be incurred for budgeting • Other information: Cost-related scheduling, communication, and risk information
• Project charter: Provides high-level cost estimates • EEF/OPA: Factors that influence success, standard procedures, templates, historical information, and lessons learned
7-10
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Unit 7
Tools for Plan Cost Management (Reference Manual p. 7-3, PMBOK® Guide p. 198)
• Expert judgment: • Applying expert judgment combined with historical information to choose appropriate cost estimating methods
• Analytical techniques: Assessing— • Various funding methods (self-funding, incur debt …) • Whether to lease or buy needed equipment
• Meetings: • Selected stakeholders who attend meetings to develop the cost management plan
7-11
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Unit 7
Outputs from Plan Cost Management (Reference Manual pp. 7-3 & 4, PMBOK® Guide pp. 198-199)
• Cost management plan: Describes how estimating, budgeting, and controlling will be conducted. Includes— • Acceptable accuracy: Accuracy varies by stage of the project • Units of measure: How to track time (hours, days, …) or materials (liters, tons, …) • Control thresholds: How much cost variance is normal vs. when do you need corrective action • Performance measurement: Rules for partially completed tasks when doing a status report • Reporting formats: Formats and frequency for reporting
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Unit 7
Estimate Costs: Introduction (Reference Manual p. 7-4, PMBOK® Guide p. 200)
• Is part of the planning process group • Estimates the costs of all resources needed to complete the project • Labor and materials • Equipment and facilities
• Other cost factors: • Services, contingency for risks, inflation, cost of financing • Accuracy of estimates increases as project moves through the life cycle
7-13
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Unit 7
Estimate Costs: Accuracy (Reference Manual p. 7-4, PMBOK® Guide p. 200)
• Know the following three types of estimates: • Order of Magnitude (aka “ROM”): Used for initiating or project approval Range of accuracy -25% to +75% • Budget: Used for initial funding in early stages of planning Range of accuracy -10% to +25% • Definitive (aka “Bottom-Up”): Used to establish cost baseline in latter stages of planning Range of accuracy -5% to +10% 7-14
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Unit 7
Estimate Costs (Reference Manual p. 7-5, PMBOK® Guide p. 200)
Inputs
Tools
Outputs
Cost management plan
Expert judgment
Activity cost estimates
Human resource management plan
Analogous estimating
Basis of estimates
Scope baseline
Parametric estimating
Project documents updates
Project schedule
Bottom-up estimating
Risk register
Three-point estimating
EEF
Reserve analysis
OPA
Cost of quality Project management software Vendor bid analysis Group decision-making techniques
7-15
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Unit 7
Inputs to Estimate Costs (Reference Manual p. 7-5, PMBOK® Guide p. 202)
• Cost management plan: Defines how costs will be managed and controlled
• Human resource management plan: Contains labor rates and a resource calendar
• Scope baseline: Contains the following— • Scope statement: Product description, constraints, assumptions Will estimates include direct and indirect costs? • WBS: Identifies cost accounts and work packages • WBS dictionary: Identifies details for the effort needed to produce deliverables
7-16
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Unit 7
Inputs to Estimate Costs (Reference Manual p. 7-6, PMBOK® Guide pp. 203-204)
• Project schedule: Identifies how long a resource will be needed thereby enabling determination of what the resource will cost
• Risk register: Provides data so that risk mitigation costs can be estimated
• EEF: Market conditions for outsourced work and commercially available cost estimating databases
• OPA: Estimating policies, templates, historical information, and lessons learned
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Unit 7
Tools for Estimate Costs (Reference Manual pp. 7-6 to 7-8, PMBOK® Guide pp. 204-207)
• Expert judgment: • Applying expert judgment combined with historical information to improve the accuracy of estimating data • Also helps in choosing appropriate estimating methods
• Analogous estimating: A form of top-down estimating • Uses actual durations from similar activities • Adjusts for differences in size, complexity, and risk • Done early in the project life cycle (initiating) • Not costly to develop but also less accurate
7-18
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Unit 7
Tools for Estimate Costs (Reference Manual pp. 7-6 to 7-8, PMBOK® Guide pp. 204-207)
• Parametric estimating: Uses historical data • Example 1: $ per square foot in housing construction • Example 2: $ per pound in aircraft development • Note: Parametric estimates are reliable if historical methods of doing the work remain similar
• Bottom-up estimating: • Detailed, accurate estimates of individual work activities • Estimates are summarized at higher levels to get project total • Work packages into cost accounts into project total • More work to develop but much more accurate
7-19
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Unit 7
Tools for Estimate Costs (Reference Manual pp. 7-6 to 7-8, PMBOK® Guide pp. 204-207)
• Three-point estimating: Uses cost data instead of durations • Uses three estimates and calculates an average: • Optimistic: The best-case outcome • Most Likely: The most likely outcome • Pessimistic: The worst-case outcome • This technique is most useful when the work is uncertain or risky
7-20
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Unit 7
Tools for Estimate Costs (Reference Manual pp. 7-6 to 7-8, PMBOK® Guide pp. 204-207)
• Reserve analysis: Reserves are added to duration estimates to account for risk • Contingency reserve: Extra time allocated within the schedule baseline Associated with known-unknowns Certain work packages are known to be risky • Management reserve: Extra time withheld from the schedule baseline Associated with unknown-unknowns Difficult to predict which work will be affected by the risk event 7-21
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Unit 7
Tools for Estimate Costs (Reference Manual pp. 7-6 to 7-8, PMBOK® Guide pp. 204-207)
• Cost of quality: The cost of activities such as training and quality audits
• Project management software: Facilitates rapid cost comparisons of various project scenarios
• Vendor bid analysis: The cost of outsourced work • Group decision-making techniques: PMI believes teams can produce more accurate estimates; teaming also leads to increased commitment to the results
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Unit 7
Outputs from Estimate Costs (Reference Manual p. 7-8, PMBOK® Guide p. 207)
• Activity cost estimates: The likely costs of resources needed to complete the project • Cost estimates are usually refined during the project life cycle • Cost estimates should consider risks
• Basis of estimates: Documentation of the following— • Description of the work (usually the WBS is sufficient) • Basis of the estimate (which method: bottom-up, parametric…) • Assumptions and constraints • Range (expected accuracy)
• Project documents updates: Updates to the risk register 7-23
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Unit 7
Determine Budget: Introduction (Reference Manual p. 7-9, PMBOK® Guide p. 208)
• Is part of the planning process group • Aggregates cost estimates for all individual activities • Establishes a cost baseline so that actual cost performance can be monitored and controlled (on track or not) • The baseline: • Includes authorized budgets and contingency reserves • Excludes management reserves
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Unit 7
Determine Budget (Reference Manual p. 7-9, PMBOK® Guide p. 208)
Inputs
Tools
Outputs
Cost management plan
Cost aggregation
Cost baseline
Scope baseline
Reserve analysis
Project funding requirements
Activity cost estimates
Expert judgment
Project documents updates
Basis of estimates
Historical relationships
Project schedule
Funding limit reconciliation
Resource calendars Risk register Agreements OPA
7-25
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Unit 7
Inputs to Determine Budget (Reference Manual p. 7-9, PMBOK® Guide p. 209)
• Cost management plan: Describes how costs will be managed and controlled
• Scope baseline: • Scope statement: Identifies any constraints on spending • WBS and dictionary: Cost accounts: Organizes estimates into useful categories Work packages: Identifies work that must be scheduled and paid for Dictionary: Identifies deliverables that must be produced
• Activity cost estimates: Provides data to estimate costs of activities, work packages, and cost accounts 7-26
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Unit 7
Inputs to Determine Budget (Reference Manual p. 7-9, PMBOK® Guide p. 209)
• Basis of estimates: Documentation of the following details— • Scope, assumptions, and constraints • Estimating method and range of accuracy • Whether indirect costs are included or not
• Project schedule: Identifies when specific costs will be incurred • Resource calendars: Identifies which resources are assigned and when
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Unit 7
Inputs to Determine Budget (Reference Manual p. 7-9, PMBOK® Guide p. 209)
• Risk register: Identifies costs associated with risk response strategies
• Agreements: Identifies costs incurred through outsourcing portions of the work
• OPA: • Formal and informal cost budgeting procedures • Cost budgeting tools • Reporting methods
7-28
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Unit 7
Tools for Determine Budget (Reference Manual p. 7-10, PMBOK® Guide p. 211)
• Cost aggregation: Costs are established for work packages and summarized at higher levels (cost accounts and entire project)
• Reserve analysis: Establishes the approach for contingency and management reserves
• Expert judgment: Improves the accuracy of the budget • Historical relationships: Referred to as parametric estimating in the previous process. Parametrics are used for cost estimating and budgeting
• Funding limit reconciliation: Preventing large fluctuations in annual expenditures • May involve changing the timing of activities 7-29
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Unit 7
Outputs from Determine Budget (Reference Manual p. 7-11, PMBOK® Guide p. 212)
• Cost baseline: The approved time-phased budget • Includes work package estimates plus contingency reserves • Excludes management reserves • Should only be changed using formal change control procedures • Is used to measure and monitor cost performance • Large projects or programs may have multiple cost baselines • Note: The following five slides show visual displays and review key principles
7-30
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Unit 7
Cost Baseline: Historical Display (Reference Manual p. 7-11, PMBOK® Guide p. 212)
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Unit 7
Cost Baseline: Modern Display Using Excel and Power Point (Reference Manual p. 7-11, PMBOK® Guide p. 212)
7-32
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Unit 7
Is This Project In Trouble?? (Reference Manual p. 7-11, PMBOK® Guide p. 212)
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Unit 7
Baseline vs. Reserve (Reference Manual p. 7-11, PMBOK® Guide p. 212)
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Unit 7
Contingency and Management Reserve (Reference Manual p. 7-11, PMBOK® Guide p. 212)
7-35
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Unit 7
Outputs from Determine Budget (Reference Manual p. 7-11, PMBOK® Guide p. 212)
• Project funding requirements: • Funding is often made available on an incremental basis • The amounts of money or the timing of the disbursements may or not be evenly distributed • Note: The next slide shows the relationship of funding requirements to the cost baseline
• Project documents updates: • Risk register • Activity cost estimates • Project schedule 7-36
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Unit 7
Funding Requirements: Additional Information (Reference Manual p. 7-11, PMBOK® Guide p. 212)
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Unit 7
Control Costs: Introduction (Reference Manual p. 7-12, PMBOK® Guide p. 215)
• Is part of the monitoring and controlling process group • Involves monitoring cost status (variances) and managing cost changes • Earned Value Management (EVM) is a special system for monitoring cost and schedule variances • The cost baseline may only be changed using the Perform Integrated Change Control process
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Unit 7
Control Costs (Reference Manual p. 7-12, PMBOK® Guide p. 215)
Inputs
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Tools
Outputs
Project management plan
Earned value management
Work performance information
Project funding requirements
Forecasting
Cost forecasts
Work performance data
To-complete performance index
Change requests
OPA
Performance reviews
Project management plan updates
Project management software
Project documents updates
Reserve analysis
OPA updates
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Unit 7
Control Costs: Key Points (Reference Manual p. 7-12, PMBOK® Guide pp. 215-216)
• Knowing that spending is within the authorized budget only has meaning if you also know that the right amount of work is getting done • EVM is one way to know whether the right amount of work is getting done • Cost control involves: • Influencing factors that create cost changes and preventing unapproved changes • Ensuring change requests are handled in a timely manner • Monitoring cost variances and managing actual changes • Informing stakeholders of approved changes and bringing expected overruns within acceptable limits 7-40
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Unit 7
Inputs to Control Costs (Reference Manual p. 7-13, PMBOK® Guide p. 216)
• Project management plan: Contains the cost baseline and cost management plan
• Project funding requirements: Identifies projected expenditures • Work performance data: Includes— • Deliverables completed or partially completed • Costs authorized vs. costs actually incurred (plan vs. actual) • Forecasts for completing the work
• OPA: Includes— • Formal and informal cost control procedures • Cost control tools and reporting methods 7-41
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Unit 7
Tools for Control Costs (Reference Manual p. 7-13, PMBOK® Guide pp. 217-225)
• Earned Value Management (EVM): A methodology that forms a performance baseline based on scope, schedule, and cost data • Provides current cost and schedule status at planned intervals (cost and schedule variances) • Also measures cost and schedule efficiencies using cost and schedule indexes)
• Forecasting: EVM also predicts future project performance at each reporting interval using various formulas
• To-Complete Performance Index (TCPI): Calculates the cost performance required to meet a specific goal
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Unit 7
Tools for Control Costs (Reference Manual p. 7-13, PMBOK® Guide pp. 217-225)
• Performance reviews: Assessing cost performance using— • Variance analysis: Planned vs. actual cost and schedule comparisons • Trend analysis: Determining whether performance is improving, deteriorating, or remaining constant • Earned value: Special technique combining variance and trend analysis
• Project management software: Automates the analysis of earned value data
• Reserve analysis: Monitors whether contingency or management reserves need adjusting
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Unit 7
Additional Information on EVM (Reference Manual pp. 7-13 & 14, PMBOK® Guide pp. 217-225)
• Topics to be covered: • EVM origin and basic concept • Three basic variables (EV, PV, AC) • Measuring variances from the baseline • Forecasting future project outcomes • Diagrams: An alternate method for EVM exam questions (less likely but possible)
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Unit 7
EVM Origin and Basic Concept (Reference Manual pp. 7-13 & 14, PMBOK® Guide pp. 217-225)
• Created by the U.S. government to control progress payments on large programs • Purpose: progress payments were supposed to reimburse work actually completed • Progress payments were not intended to reimburse cost overruns
• Basic information provided by EVM: • Current cost and schedule status in the form of variances and indexes • Forecasts of future project outcomes using various formulas
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Unit 7
Three Basic Variables (Reference Manual pp. 7-13 & 14, PMBOK® Guide pp. 217-225)
• Planned Value (PV): budgeted cost for the work that should be done at a given time • Old name: BCWS (budgeted cost of work scheduled)
• Earned Value (EV): budgeted amount for the work that has been accomplished (measured at the same point in time as PV) • Old name: BCWP (budgeted cost of work performed)
• Actual Cost (AC): actual or total cost incurred in doing the work accomplished thus far (as measured by EV) • Old name: ACWP (actual cost of work performed)
7-46
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Unit 7
Cost Variance and Cost Performance Index (Reference Manual pp. 7-13 & 14, PMBOK® Guide pp. 217-225)
7-47
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Unit 7
Schedule Variance and Schedule Performance Index (Reference Manual pp. 7-13 & 14, PMBOK® Guide pp. 217-225)
7-48
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Unit 7
Earned Value Interpretation (Reference Manual pp. 7-13 & 14, PMBOK® Guide pp. 217-225)
7-49
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Unit 7
Forecasting: Estimate at Completion (Reference Manual pp. 7-13 & 14, PMBOK® Guide pp. 217-225)
7-50
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Unit 7
EAC: Second Formula (Reference Manual pp. 7-13 & 14, PMBOK® Guide pp. 217-225)
7-51
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EAC: Third Formula (Reference Manual pp. 7-13 & 14, PMBOK® Guide pp. 217-225)
7-52
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Unit 7
Estimate to Complete (ETC) (Reference Manual pp. 7-13 & 14, PMBOK® Guide pp. 217-225)
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Variance at Completion (VAC) (Reference Manual pp. 7-13 & 14, PMBOK® Guide pp. 217-225)
7-54
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Unit 7
To-Complete Performance Index (TCPI) (Reference Manual pp. 7-13 & 14, PMBOK® Guide pp. 217-225)
7-55
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Unit 7
To-Complete Performance Index (TCPI) (Reference Manual pp. 7-13 & 14, PMBOK® Guide pp. 217-225)
7-56
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Unit 7
EVM Performance Measurement Rules (Reference Manual pp. 7-13 & 14, PMBOK® Guide pp. 217-225)
7-57
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Unit 7
Diagrams: First Example-Alternate Type of EVM Question (Reference Manual pp. 7-13 & 14, PMBOK® Guide pp. 217-225)
7-58
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Unit 7
Diagrams: First Example-Alternate Type of EVM Question (Reference Manual pp. 7-13 & 14, PMBOK® Guide pp. 217-225)
7-59
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Unit 7
Diagrams: First Example-Alternate Type of EVM Question (Reference Manual pp. 7-13 & 14, PMBOK® Guide pp. 217-225)
7-60
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Unit 7
Diagrams: Second Example (Reference Manual pp. 7-13 & 14, PMBOK® Guide pp. 217-225)
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Unit 7
Diagrams: Third Example (Reference Manual pp. 7-13 & 14, PMBOK® Guide pp. 217-225)
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Unit 7
EVM Terms and Formulas (Reference Manual pp. 7-13 & 14, PMBOK® Guide pp. 217-225)
• PV (BCWS): Planned Value (Budgeted Cost of Work Scheduled). How much work should be done at any point in time ($ or hours). • EV (BCWP): Earned Value (Budgeted Cost of Work Performed). How much work has been completed/performed ($ or hours). • AC (ACWP): Actual Cost (Actual Cost of Work Performed). Actual amount of effort expended ($ or hours). • BAC: Budget at Completion. Original cost estimate for the total project. • SV: Schedule Variance. EV-PV or (BCWP-BCWS) • CV: Cost Variance. EV-AC or (BCWP-ACWP) • CPI: Cost Performance Index. EV / AC or (BCWP / ACWP) • SPI: Schedule Performance Index. EV / PV or (BCWP / BCWS) • EAC: Estimate at Completion. A revised estimate of the total project cost at completion. BAC/CPI or AC + (BAC-EV) or AC + (BAC-EV)/(CPI x SPI) • ETC: Estimate to Complete. Estimated remaining cost. EAC-AC or BAC-EV • VAC: Variance at completion. Estimated difference between the original cost (BAC) & the revised cost (EAC). BAC-EAC • TCPI: To Complete Performance Index. What the CPI will need to be to finish at a specific goal. (BAC-EV) / (BAC-AC) or (BAC-EV) / EAC-AC) 7-63
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Unit 7
Outputs from Control Costs (Reference Manual p. 7-14 PMBOK® Guide p. 225)
• Work performance information: The data calculated using EVM is communicated to stakeholders
• Cost forecasts: The latest EAC is communicated to stakeholders • Change requests: Changes to the cost baseline which must be reviewed using the Perform Integrated Change Control process
• Project management plan updates: Potential changes to the cost baseline or cost management plan
• Project documents updates: Potential changes to cost estimates or the basis of those estimates
• OPA updates: New lessons learned (causes of variances and corrective actions) 7-64
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Unit 7
Other Topics (Reference Manual pp. 7-15 to 7-18, PMBOK® Guide No Reference)
• Other Topics covers information known to be on the real exam but not addressed by the PMBOK® Guide: • Financial concepts: Opportunity cost, sunk cost, payback period, Benefit-cost ratio, present value, net present value, IRR Return on investment, learning curve • Depreciation of capital and value analysis • Law of diminishing returns and variable vs. fixed costs • Direct vs. indirect costs and working capital 7-65
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Unit 7
Opportunity Cost and Sunk Cost (Reference Manual pp. 7-15 to 7-18, PMBOK® Guide No Reference)
• Opportunity cost: The benefit you give up by choosing not to do a project (usually pursuing a better project that has superior financial potential)
• Sunk cost: Expended costs which you no longer control • Money already spent that cannot be recovered • Sunk costs should be ignored when deciding to spend the remaining money needed to finish a project
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Unit 7
Payback Period (Reference Manual pp. 7-15 to 7-18, PMBOK® Guide No Reference)
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Unit 7
Benefit Cost Ratio (BCR) (Reference Manual pp. 7-15 to 7-18, PMBOK® Guide No Reference)
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Unit 7
Present Value (Reference Manual pp. 7-15 to 7-18, PMBOK® Guide No Reference)
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Unit 7
Net Present Value (NPV) (Reference Manual pp. 7-15 to 7-18, PMBOK® Guide No Reference)
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Unit 7
Internal Rate of Return (IRR) (Reference Manual pp. 7-15 to 7-18, PMBOK® Guide No Reference)
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Unit 7
IRR: Additional Notes (Reference Manual pp. 7-15 to 7-18, PMBOK® Guide No Reference)
• Consider Project A from the previous slide: • At an interest rate lower than 18% (say 14%), the project would still show a profit using NPV calculations • At an interest rate of 18%, NPV showed that Project A would be at an exact breakeven point • At interest rates higher than 18%, NPV calculations would begin showing financial losses for the cash flows on Project A
• For Project B: • Project B is stronger financially because it still shows profits above the 18% interest rate • IF there were a Project C under consideration and its IRR was 40%, then it would be the best project 7-72
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Unit 7
Return on Investment (ROI) (Reference Manual pp. 7-15 to 7-18, PMBOK® Guide No Reference)
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ROI: Example (Reference Manual pp. 7-15 to 7-18, PMBOK® Guide No Reference)
• Assume the following information has been estimated: • Your technology project has been under way for three years. • Total revenues have been measured at $800,000 • Total costs in those three years were $580,000
• What is the ROI? • (Revenue-Costs)/Costs = ($800k-$580k)/$580k = $220k/$580k • The ROI is 0.379 or 37.9% • An ROI greater than zero indicates a profit
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Unit 7
Learning Curve: Parametric Cost Estimating (Reference Manual pp. 7-15 to 7-18, PMBOK® Guide No Reference)
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Unit 7
Depreciation of Capital (Reference Manual pp. 7-15 to 7-18, PMBOK® Guide No Reference)
• When purchasing capital equipment, part of the expense may be “written off” on your taxes • The following are methods for “accelerating” the tax credit: • Double declining balance • Sum of the years digits • You do not need to know the procedure
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Unit 7
Value Analysis (Reference Manual pp. 7-15 to 7-18, PMBOK® Guide No Reference)
• Also called value engineering • Most people consider the terms interchangeable • A cost reduction tool using four classic steps: 1) Identify the discrete functions in an existing item or the design of a new item 2) What portion of the overall cost does each function represent? 3) Determine whether each function is a need or a want. Can anything be deleted? 4) Search for different approaches that will deliver the needed functionality at a lower cost
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Unit 7
Law of Diminishing Returns (Reference Manual pp. 7-15 to 7-18, PMBOK® Guide No Reference)
• Situations in which you put more and more into something and get less and less back • If you study too long in the same day, you get tired and become inefficient • If you are spending money to develop cutting edge technology, you sometimes reach a plateau. Spending more money will yield little improvement!
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Unit 7
Variable vs. Fixed Costs (Reference Manual pp. 7-15 to 7-18, PMBOK® Guide No Reference)
• Fixed costs: Non-recurring start-up cost • Installing a production line: Buy the equipment, put it in place, test its use, and make adjustments
• Variable costs: Vary with the size of the project or the number of units to be produced • Labor and materials in each item produced
• For the exam: • The cost of 100 units would be the fixed cost to get started plus the variable cost of 100 units • The cost of 20 “additional or extra” units would be just the variable cost for the additional 20 units 7-79
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Unit 7
Direct vs. Indirect Costs (Reference Manual pp. 7-15 to 7-18, PMBOK® Guide No Reference)
• Direct costs: Incurred directly by a specific project • Salaries of project staff including the project manager • Labor and materials to do the specific work of the project
• Indirect costs: The organization’s cost of doing business • Security guards • Electricity • Fringe benefits • Insurance • Taxes • Projects share these costs on a pro-rated basis 7-80
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Unit 7
Working Capital (Reference Manual pp. 7-15 to 7-18, PMBOK® Guide No Reference)
• Current assets minus current liabilities
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Unit 7
Drill Practice Reminder
Drill practice for this chapter starts on p. 7-19
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Unit 8
QUALITY MANAGEMENT
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Unit 8
Quality Management Concept (Reference Manual p. 8-1, PMBOK® Guide p. 227)
• Quality management includes the processes that determine quality policies and objectives so that project needs will be satisfied • Overview of 3 processes: • Plan Quality Management Planning • Perform Quality Assurance Executing • Control Quality
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Unit 8
Quality Management: Key Points (Reference Manual pp. 8-1 & 2, PMBOK® Guide pp. 227-229)
• Know the following concepts and definitions: • Quality management is aimed at meeting project needs and requirements • Quality is the degree to which a set of inherent characteristics fulfills requirements • Quality and grade are not the same thing: Grade is features and functions. You might choose a lower grade to save money. Days Inn instead of Hilton Resort! However, low quality is not acceptable because it means you are not fully meeting requirements
8-3
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Unit 8
Quality Management: Key Points (Reference Manual pp. 8-1 & 2, PMBOK® Guide pp. 227-229)
• Concepts and definitions (continued): • Gold-plating is providing a solution that exceeds the original requirement PMI: Gold-plating is bad because it usually makes the project cost more and/or take longer Your customer will be happy if you accurately identify and meet requirements • You must produce accurate and precise (exact) outcomes: Precision means outcomes with low variation However, you must also produce accurate outcomes or the results could consistently fail to meet requirements
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Unit 8
Quality Management: Key Points (Reference Manual pp. 8-1 & 2, PMBOK® Guide pp. 227-229)
• Concepts and definitions (continued): • PMI also states that modern quality management emphasizes: Customer satisfaction: Emphasizing conformance to requirements (produce what you said you would) and fitness for use (product or service meets real needs)
Prevention over inspection: The cost of avoiding mistakes is less than the cost of correcting them
Continuous improvement: Using PDCA (plan-do-check-act) as the basis for quality improvement
Management responsibility: Management has the greatest role in providing adequate resources for effective quality programs
Cost of quality: Effectively managing costs of conformance vs. costs of non-conformance 8-5
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Unit 8
Overview of Topics in Unit 8 • Quality Management Processes • Other Topics • Information that has been tested but is not covered by the PMBOK® Guide.
• Drill Practice
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Unit 8
Overview of Quality Management Processes (Reference Manual p. 8-1, PMBOK® Guide p. 227)
8.1 Plan Quality Management (identifying quality requirements and standards and how to demonstrate compliance)
8.2 Perform Quality Assurance (auditing quality requirements and quality control measurements to ensure appropriate quality standards are used)
8.3 Control Quality (monitoring results to assess performance and recommend necessary changes)
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Unit 8
Selected Knowledge Area, Process Groups, and Processes (Reference Manual p. 3-7, PMBOK® Guide pp. 60-61)
Process Groups Knowledge Areas
Initiating
Planning
Executing
Controlling
Closing
Integration Scope Time Cost Quality
• Plan quality management
• Perform quality assurance
• Control quality
HR Communication Risk Procurement Stakeholder
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Unit 8
Plan Quality Management: Introduction (Reference Manual p. 8-2, PMBOK® Guide p. 231)
• Is part of the planning process group • Results in a quality management plan which: • Identifies quality requirements and standards for the project and documents how to demonstrate compliance • Provides guidance on how quality will be managed and validated • Emphasizes that quality should be planned in, not inspected in
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Unit 8
Plan Quality Management (Reference Manual p. 8-3, PMBOK® Guide p. 232)
Inputs
Tools
Outputs
Project management plan
Cost-benefit analysis
Quality management plan
Stakeholder register
Cost of quality
Process improvement plan
Risk register
Seven basic quality tools
Quality metrics
Requirements documentation
Benchmarking
Quality checklists
EEF
Design of experiments
Project documents updates
OPA
Statistical sampling Additional quality planning tools Meetings
Note: EEF = Enterprise Environmental Factors OPA = Organizational Process Assets 8-10
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Unit 8
Inputs to Plan Quality Management (Reference Manual p. 8-3, PMBOK® Guide p. 233)
• Project management plan: Contains the following— • Scope baseline: Contains the scope statement (product description and acceptance criteria) and WBS (deliverables and work packages)
• Schedule baseline: Approved start and finish times • Cost baseline: Planned costs and time intervals for measuring and reporting actual performance
• Other management plans (HR, risk, etc.): May identify actionable quality concerns
• Stakeholder register: Identifies stakeholders with an interest in the project
• Risk register: May contain information related to quality concerns that could threaten the project 8-11
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Unit 8
Inputs to Plan Quality Management (Reference Manual p. 8-4, PMBOK® Guide p. 234)
• Requirements documentation: Identifies product and project requirements that must be met
• EEF: • Regulations (mandatory, require compliance) and standards (optional, preferred practices) • Working conditions and cultural attitudes toward quality
• OPA: • Quality policies and procedures • PMI on quality policy: The overall intention of top management toward quality • Historical data and lessons learned 8-12
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Unit 8
Tools for Plan Quality Management (Reference Manual p. 8-4, PMBOK® Guide p. 235)
• Cost-benefit analysis: The cost of quality management activities vs. the resulting benefits. The benefits of meeting quality requirements— • Less rework and higher productivity • Lower overall costs and increased stakeholder satisfaction
• Cost of quality (COQ): • Includes costs of conformance (preventing defects and assessing quality) and costs of non-conformance (fixing defects) • Prevention (spending on conformance) is preferred as it is believed that it will reduce overall costs
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Unit 8
Additional Information on COQ (Reference Manual p. 8-5, PMBOK® Guide p. 235)
Prevention
Appraisal
Failure
(Build a Quality Product) “Conformance”
(Assess Quality) “Conformance”
Handle Defects “Nonconformance”
• Planning
• Testing
• Training
• Process control
• Good processes
• Inspection
Internal Failure (Found by Project) • Rework
• Maintain equipment
• Scrap
• Time to do it right
External Failure (Found by Customer) • Liabilities (recalls) • Warranty work • Lost business
Note: 80-90% of the cost of quality is the responsibility of management!!
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Unit 8
Tools for Plan Quality Management (Reference Manual pp. 8-5 to 8-8, PMBOK® Guide pp. 236-238)
• Seven basic quality tools: Known as 7QC, these classic tools are used to solve quality related problems • Cause and effect diagram: Also known as fishbone or Ishikawa diagram Problem statement placed at the head of the fishbone Then trace the source of the problem back to actionable root causes See additional slide
• Flowcharts: Also called process maps Diagrams used to help analyze and improve processes Flowcharts show activities, decision points, and the sequence of steps performed 8-15
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Unit 8
Tools for Plan Quality Management (Reference Manual pp. 8-5 to 8-8, PMBOK® Guide pp. 236-238)
• 7QC (continued): • Checksheets: Also called tally sheets Organizes quick data collection in a standard format Data often collected: Defect cause and location, number of defects Data used in Pareto charts often comes from checksheets
• Pareto diagrams: Based on the notion that 80% of problems/defects come from only 20% of the sources/causes A vertical bar chart, tallest bar on the left, and descending in order to the right The tallest bar on the left shows the number one cause of defects See additional slide 8-16
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Unit 8
Tools for Plan Quality Management (Reference Manual pp. 8-5 to 8-8, PMBOK® Guide pp. 236-238)
• 7QC (continued): • Histograms: Vertical bar charts that prioritize or rank order data Pareto diagram is a specific type of histogram
• Control charts: Used to determine whether a process is under control Tracks three types of data: 1) The center line which is the perfect or average outcome 2) Control limits (show the variation of the process) 3) Specification limits (show how much variation is acceptable to the customer) See additional slides (and reference manual, Unit 8)
• Scatter diagrams: Plot the relationship between two variables See additional slide 8-17
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Unit 8
Example of Cause and Effect Diagram (Reference Manual pp. 8-5 to 8-8, PMBOK® Guide pp. 236-238)
8-18
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Unit 8
Example of Pareto Diagram (Reference Manual pp. 8-5 to 8-8, PMBOK® Guide pp. 236-238)
8-19
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Unit 8
Control Charts: Normal and Random (Reference Manual pp. 8-5 to 8-8, PMBOK® Guide pp. 236-238)
8-20
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Unit 8
Control Charts: Add Specification Limits (Reference Manual pp. 8-5 to 8-8, PMBOK® Guide pp. 236-238)
8-21
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Unit 8
Control Charts: Special Cause (Reference Manual pp. 8-5 to 8-8, PMBOK® Guide pp. 236-238)
8-22
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Unit 8
Control Charts: Rule of Seven (Heuristic) (Reference Manual pp. 8-5 to 8-8, PMBOK® Guide pp. 236-238)
8-23
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Unit 8
Scatter Diagram: Regression Analysis (Reference Manual pp. 8-5 to 8-8, PMBOK® Guide pp. 236-238)
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Unit 8
Tools for Plan Quality Management (continued) (Reference Manual pp. 8-5 to 8-8, PMBOK® Guide pp. 236-238)
• Benchmarking: Comparing planned or actual practices to— • Generate ideas for improvement • Provide a standard or goal to work toward
• Design of experiments: “Observations conducted under controlled circumstances” • Used for optimizing products or processes
• Statistical sampling: Choosing part of a population for inspection • Done to reduce the cost of quality • A sampling plan is created so that the total cost of quality can be calculated 8-25
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Unit 8
Tools for Plan Quality Management (Reference Manual pp. 8-5 to 8-8, PMBOK® Guide pp. 236-238)
• Additional quality planning tools: General tools that may be applied to quality planning • Brainstorming • Force field analysis • Nominal group technique • Other quality management tools (also listed under quality assurance)
• Meetings: • Selected stakeholders who attend meetings to develop the quality management plan
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Unit 8
Outputs from Plan Quality Management (Reference Manual p. 8-9, PMBOK® Guide pp. 241-242)
• Quality management plan: Describes how the team will implement quality policy
• Process improvement plan: Steps for improving existing processes • Process boundaries: Describes the purpose, start, and end of the process
• Process configuration: A diagram or flowchart that shows all steps and interfaces in the process
• Process metrics: For measuring performance and improvements • Targets for improved performance: Goals that guide improvement activities
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Unit 8
Outputs from Plan Quality Management (Reference Manual p. 8-9, PMBOK® Guide pp. 241-242)
• Quality metrics: Measurements of actual outcomes • Defect frequency, reliability, failure rate, and test results
• Quality checklists: A structured tool to verify that all steps in a process have been performed
• Project documents updates: • Stakeholder register • Responsibility assignment matrix • WBS and WBS dictionary
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Unit 8
Perform Quality Assurance: Introduction (Reference Manual p. 8-10, PMBOK® Guide p. 242)
• Is part of the executing process group • Audits quality requirements and quality control measurements to ensure appropriate quality standards are used
8-29
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Unit 8
Perform Quality Assurance (Reference Manual p. 8-10, PMBOK® Guide p. 243)
Inputs
Tools
Outputs
Quality management plan
Quality management and control Change requests tools
Process improvement plan
Quality audits
Project management plan updates
Quality metrics
Process analysis
Project documents updates
Quality control measurements
OPA updates
Project documents
8-30
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Unit 8
Perform Quality Assurance: Key Points (Reference Manual p. 8-10, PMBOK® Guide pp. 242-244)
• Creates a management system: • Audits quality requirements • Reviews organizational processes • Captures results from quality control (QC measurements) • Builds confidence that future work outputs will meet quality requirements
• Quality assurance is also the umbrella for continuous improvement • An iterative means for improving the quality of all processes
• QA uses data from the Plan Quality and Control Quality processes 8-31
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Unit 8
Inputs to Perform Quality Assurance (Reference Manual p. 8-10, PMBOK® Guide p. 244)
• Quality management plan: Describes QA and continuous improvement approaches for the project
• Process improvement plan: Describes intended improvement processes and plans
• Quality metrics: Attributes to be measured (developed previously in the quality management plan)
• Quality control measurements: An output of quality control, this data indicates whether processes are performing to required standards
• Project documents: Monitoring documents within the context of configuration management
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Unit 8
Tools for Perform Quality Assurance (Reference Manual pp. 8-11 & 12, PMBOK® Guide pp. 245-247)
• Quality management and control tools: • QA uses tools from quality planning and quality control • Other general tools, e.g., affinity diagrams, may be applied to QA. See reference manual for examples.
• Quality audits: Structured, independent reviews to determine if project activities comply with organizational policies and procedures • Objectives of a quality audit: Identify and share best practices Identify shortcomings and nonconformities Document lessons learned and proactively offer positive assistance
• Audits may be scheduled or random (unannounced) 8-33
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Unit 8
Tools for Perform Quality Assurance (Reference Manual p. 8-12, PMBOK® Guide p. 247)
• Process analysis: Identifying and implementing needed improvements by using process improvement plans developed earlier
8-34
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Unit 8
Outputs from Perform Quality Assurance (Reference Manual p. 8-12, PMBOK® Guide pp. 247-248)
• Change requests: Change requests should always be handled using the Integrated Change Control process • In this case, changes would be aimed at quality improvement • As always, changes may be used to initiate corrective or preventive action or to request defect repair
• Project management plan updates: • Quality management plan • Scope management plan • Schedule management plan • Cost management plan
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Outputs from Perform Quality Assurance (Reference Manual p. 8-13, PMBOK® Guide p. 248)
• Project documents updates: • Quality audit reports • Training plans • Process documentation
• OPA updates: • Quality standards • Quality management system
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Unit 8
Quality Assurance: Other Information (Reference Manual p. 8-13, PMBOK® Guide No Reference)
• Two types of quality evaluation: • Formative: Similar to mid-project evaluation, done during the project to make corrections
• Summative: Similar to post-project evaluation, done at completion to document lessons learned
• Responsibility for quality: • For a Task: Belongs to the employee performing the task • For the Project: Belongs to the project manager
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Unit 8
Control Quality: Introduction (Reference Manual p. 8-13, PMBOK® Guide p. 248)
• Is part of the monitoring and controlling process group • Involves monitoring and recording specific project results to assess performance and recommend necessary changes • Validates that project deliverables met requirements so that formal acceptance may be accomplished
8-38
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Unit 8
Control Quality (Reference Manual p. 8-14, PMBOK® Guide p. 249)
Inputs
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Tools
Outputs
Project management plan
Seven basic quality tools
QC measurements
Quality metrics
Statistical sampling
Validated changes
Quality checklists
Inspection
Verified deliverables
Work performance data
Approved change requests review
Work performance information
Approved change requests
Change requests
Deliverables
Project management plan updates
Project documents
Project documents updates
Organizational process assets
OPA updates
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Unit 8
Control Quality: Key Points (Reference Manual p. 8-13, PMBOK® Guide pp. 248-250)
• QA and QC differ as follows: • QA is used during planning and executing to provide confidence that future work will meet requirements • QC is used during executing and closing to provide reliable data that actual work results met requirements
• Know the following terminology: • Prevention: keep errors out of the process vs. inspection: keep errors from reaching the customer
• Attribute sampling: the result conforms or not (dented or not dented) vs. variable sampling: the result must be measured and conform to a certain exactness
• Tolerance: the result is within specification limits vs. control limits: the process is under control if outcomes remain within the control limits 8-40
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Unit 8
Inputs to Control Quality (Reference Manual pp. 8-14 & 15, PMBOK® Guide pp. 250-251)
• Project management plan: Contains the quality management plan • Quality metrics: Identifies attributes to be measured such as MTBF (Mean Time Between Failure) and MTTR (Mean Time To Repair)
• Quality checklists: Developed previously as part of planning • Work performance data: • Planned vs. actual technical performance • Planned vs. actual schedule performance • Planned vs. actual cost performance
• Approved change requests: May affect work methods; the team must verify correct and timely implementation of changes 8-41
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Unit 8
Inputs to Control Quality (Reference Manual pp. 8-14 & 15, PMBOK® Guide p. 251)
• Deliverables: Any verifiable product or work result • Project documents: • Agreements (contracts), change logs, and quality audit reports • Training plans and process documentation (records of actual results)
• OPA: • Quality standards and policies • Standard work guidelines • Issue and defect reporting policies
8-42
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Unit 8
Tools for Control Quality (Reference Manual p. 8-15, PMBOK® Guide pp. 252)
• Seven basic quality tools: Covered during planning, 7QC also applies to quality control
• Statistical sampling: Sampling plans were described in planning; sampling reduces the cost of quality control. Sampling is appropriate when— • The population is large • The cost of inspection is high • Destructive testing is required • You have reason to believe the defect rate is low
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Unit 8
Tools for Control Quality (Reference Manual pp. 8-15 & 16, PMBOK® Guide pp. 252)
• Inspection: Examining a work result to determine whether it conforms to documented standards. Also called— • Reviews or peer reviews • Audits • Walkthroughs
• Approved change requests review: Verifying that approved changes have been implemented correctly
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Unit 8
Outputs from Control Quality (Reference Manual pp. 8-16 & 17, PMBOK® Guide pp. 252-254)
• QC measurements: Described in QA, these measurements evaluate whether current quality standards are effective (defect rate is low)
• Validated changes: Repaired or changed items are inspected • Verified deliverables: Deliverables confirmed as correct are reported as such to the Validate Scope process for formal acceptance
• Work performance information: Performance data that have been analyzed • Causes for rejected work • Rework and process adjustments
8-45
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Unit 8
Outputs from Control Quality (Reference Manual pp. 8-16 & 17, PMBOK® Guide pp. 252-254)
• Change requests: Used to request corrective action, preventive action, and defect repair • Must be processed using Perform Integrated Change Control
• Project management plan updates: May update the quality management or process improvement plans
• Project documents updates: Potential changes to cost estimates or the basis of those estimates • Quality standards and agreements • Quality audit reports and change logs • Training plans and process documentation
• OPA updates: Recording the use of checklists in historical database 8-46
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Unit 8
Other Topics (Reference Manual pp. 8-17 to 8-19, PMBOK® Guide No Reference)
• Other Topics covers information known to be on the real exam but not addressed by the PMBOK® Guide: • Graphs, kaizen, and continuous improvement • Priority of quality, cost, and schedule • Design vs. quality, JIT, kanban • Motivation vs. quality, marginal analysis, Taguchi method • Basic terminology, three vs. six sigma, TQM • ISO 9000, run chart
8-47
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Unit 8
Graphs and Kaizen (Reference Manual pp. 8-17 to 8-19, PMBOK® Guide No Reference)
• Graphs: Pictorial displays that are easily understood • Pie chart (relative or comparative effect) • Line graphs (shows a trend if one exists) • Histograms (vertical bar charts that group or rank order data, the Pareto diagram is a histogram)
• Kaizen and continuous improvement: Kaizen is the name for incremental, continuous improvement • Purpose: Reduce variances and particularly the cost of nonconformance • Warusa kagen: Japanese name for something that isn’t wrong but is not exactly right either (e.g., Rule of Seven)
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Unit 8
Priority of Quality and Design vs. Quality (Reference Manual pp. 8-17 to 8-19, PMBOK® Guide No Reference)
• Priority of quality compared to cost and schedule: Quality should share genuinely equal priority
• Design vs. quality: Careful up-front design of a product or service should increase reliability and maintainability (two important quality concepts) • Quality should be designed in, not inspected in!! • Primary responsibility for developing design specifications belongs to project engineers
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JIT and Kanban (Reference Manual pp. 8-17 to 8-19, PMBOK® Guide No Reference)
• JIT (Just-in-Time): Inventory approach that reduces work-in-process inventory to zero buffer or safety stock • If an organization has low quality (high rate of defects) while attempting to implement JIT, what will happen to the schedule? • Discuss with instructor
• Kanban: Works as part of JIT as the means for a worker to request more input to their work station • In JIT, work is not pushed forward but is rather requested when needed • Kanban is the communication mechanism to request more input:
8-50
Scanning bar codes, “runners”, ping pong balls through vacuum tubes, etc.
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Unit 8
Motivation, Marginal Analysis, and Taguchi (Reference Manual pp. 8-17 to 8-19, PMBOK® Guide No Reference)
• Motivation vs. quality: Higher quality is likely when team members display pride and commitment • One way to harm such a culture: allow frequent turnover of people assigned to the project
• Marginal analysis: Borrowed from the literature on economics • Optimal quality occurs where the incremental revenue from an improvement equals the incremental cost to secure it
• Taguchi method: Developed by Dr. Genichi Taguchi • Calculated a loss function using statistical quality control • Showed that when finished products were closer to customer specifications, the organization experienced lower financial losses (greater profits) 8-51
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Unit 8
Attribute, Variable, Probability (Reference Manual pp. 8-17 to 8-19, PMBOK® Guide No Reference)
• Attribute: A quality characteristic that shows conformance or nonconformance, can be objective or subjective
• Variable: A quality characteristic that is numerically measurable in increments • Diameter of a bolt measured in inches or centimeters
• Probability: The likelihood that something will happen • For attributes: Like a coin toss, 50-50 chance to occur or not occur • For variables: Involves ranges of possible outcomes and is more complicated. Two familiar distributions— Normal distribution or bell curve Histogram, e.g. a Pareto diagram 8-52
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Unit 8
Population, Sample, Standard Deviation (Reference Manual pp. 8-17 to 8-19, PMBOK® Guide No Reference)
• Population: The entire group of items that we wish to measure • Sample: Measuring a portion of the items in a population hoping for an accurate picture of the entire group at a lower measurement cost
• Standard deviation: Measures expected variations around an estimated average outcome (also referred to as “sigma”). Know this difference: • +/- 3 Sigma: PMI calls it the traditional approach to setting quality standards If your processes are designed to this standard, 99.7% of outcomes will meet requirements (3 items per 1000 will be defective) • +/- 6 Sigma: PMI calls this the modern approach to setting quality standards. At this standard, 99.9997% of outcomes will meet requirements (3.4 items per 1,000,000 will be defective) 8-53
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TQM, ISO 9000, Run Chart (Reference Manual pp. 8-17 to 8-19, PMBOK® Guide No Reference)
• TQM (Total Quality Management): An approach for implementing a quality improvement program and for pursuing continuous improvement
• ISO 9000: Created by the International Organization for Standardization • A set of documented standards to ensure that organizations meet certain minimum levels of performance
• Run chart: A trend analysis using a line graph that plots data points in exact chronological order of occurrence. The data may show: • Variances • Trends (performance improving, deteriorating, or remaining constant)
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Drill Practice Reminder
Drill practice for this chapter starts on p. 8-21
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Unit 9
HUMAN RESOURCE MANAGEMENT
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Human Resource (HR) Management Concept (Reference Manual p. 9-1, PMBOK® Guide p. 255)
• HR management includes the processes that organize, manage, and lead the project team • Overview of 4 processes:
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• Plan HR Management
Planning
• Acquire Project Team
Executing
• Develop Project Team
Executing
• Manage Project Team
Executing
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HR Management: Key Points (Reference Manual p. 9-1, PMBOK® Guide pp. 255-256)
• HR processes are aimed at making the most effective use of people: • Sponsor, upper management, the customer • PM, team members, other stakeholders • The sponsor is important in matters of funding, clarifying scope, and influencing other stakeholders to support the project
• Participation of team members during planning: • Adds their expertise • Strengthens their commitment to the project
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HR Management: Key Points (Reference Manual p. 9-1, PMBOK® Guide pp. 255-256)
• Managing and leading include: • Influencing the team: controlling communication, politics, cultural issues, and interpersonal issues • Professional and ethical behavior: The management team must behave in an ethical manner The management team must also ensure ethical behavior in other team members
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Overview of Topics in Unit 9 • HR Management Processes • Other Topics • Information that has been tested but is not covered by the PMBOK® Guide.
• Drill Practice
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Unit 9
Overview of HR Management Processes (Reference Manual p. 9-1, PMBOK® Guide p. 255)
9.1 Plan HR Management (establishing roles, responsibilities, reporting relationships, and creating a staffing management plan)
9.2 Acquire Project Team (getting the human resources needed to complete the project)
9.3 Develop Project Team (improving competencies and interaction of team members)
9.4 Manage Project Team (tracking performance, providing feedback, resolving issues, and coordinating changes)
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Unit 9
Selected Knowledge Area, Process Groups, and Processes (Reference Manual p. 3-7, PMBOK® Guide pp. 60-61)
Process Groups Knowledge Areas
Initiating
Planning
Executing
Controlling
Closing
Integration Scope Time Cost Quality • Plan HR management
HR
• Acquire project team • Develop project team • Manage project team
Communication Risk Procurement Stakeholder
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Plan HR Management: Introduction (Reference Manual p. 9-2, PMBOK® Guide p. 258)
• Is part of the planning process group • Results in a human resource management plan which: • Identifies and assigns roles, responsibilities, and reporting relationships • Creates a staffing management plan which addresses: Acquisition and release of team members Training needs and reward systems • Considers that the project is competing for limited human resources
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Unit 9
Plan HR Management (Reference Manual p. 9-2, PMBOK® Guide p. 258)
Inputs
Tools
Project management plan
Organization charts and position descriptions
Activity resource requirements
Networking
EEF
Organizational theory
OPA
Expert judgment
Outputs HR management plan
Meetings
Note: EEF = Enterprise Environmental Factors OPA = Organizational Process Assets 9- 9
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Unit 9
Inputs to Plan HR Management (Reference Manual p. 9-2, PMBOK® Guide p. 259)
• Project management plan: Other parts of the project plan which might support development of the HR plan— • Processes for each phase of the life cycle • Change and configuration management plans • How integrity of project baselines will be maintained • Communication needs and methods
• Activity resource requirements: Human resources needed for activities are also estimated as part of time management
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Unit 9
Inputs to Plan HR Management (Reference Manual p. 9-3, PMBOK® Guide p. 260)
• EEF: • Organizational structure: PM has less control over the team in a functional silo or weak matrix structure
• Existing human resources: Resources already available in-house • Personnel administration policies: The system for hiring new people and assigning people to specific project teams
• Marketplace: Availability of contractors to accept outsourcing
• OPA: • Organizational processes, procedures, lessons learned, and historical information • Templates for organizational charts and job descriptions • Escalation procedures for handling personnel issues 9- 11
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Tools for Plan HR Management (Reference Manual p. 9-3, PMBOK® Guide p. 261)
• Organization charts and position descriptions: Documenting roles and responsibilities
• RAM (responsibility assignment matrix) displays who does what • A RACI chart is more detailed: Shows Responsible, Accountable, Consult, and Inform • Key points:
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A RACI chart should never show more than one person accountable
A RAM does not show timing of the work
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Unit 9
Tools for Plan HR Management (Reference Manual p. 9-4, PMBOK® Guide pp. 263-264)
• Networking: Expanding the extent of your personal influence and ability to get information • Luncheons, conferences, and recreational activities
• Organizational theory: Using published literature and studies on organizational structures and issues • Virtual teams • Success factors in managing functional vs. matrix vs. projectized structures
• Expert judgment: Used to determine required skills, reporting relationships, and resource risks
• Meetings: Selected experts who meet to develop the HR management plan 9- 13
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Unit 9
Outputs from Plan HR Management (Reference Manual p. 9-5, PMBOK® Guide pp. 264-267)
• HR management plan: • Roles and responsibilities: Role: The function performed by a person (engineer, business analyst) Responsibility: The task you are assigned and expected to perform Authority: The right to make decisions, apply resources, and grant approvals
• Project organization charts: Display of reporting relationships • Staffing management plan: How resource requirements will be met
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Staff acquisition: Whether resources will come from inside or outside the organization
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Unit 9
Outputs from Plan HR Management (Reference Manual p. 9-5, PMBOK® Guide pp. 264-267)
• Staffing management plan (continued):
Resource calendar: A popular planning calendar is a resource histogram (see additional slide)
Staff release plan: Moving people off the project when they are no longer needed. Two benefits are— Reduced costs by not letting someone sit idle Improved morale by reducing uncertainty about assignments
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Training needs: Used if any team members arrive lacking required competencies or skills
Recognition and reward systems: To promote and reinforce desired behaviors
Compliance and safety: strategies for complying with regulations and providing a safe working environment
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Unit 9
Staffing Management Plan: Resource Histogram (Reference Manual p. 9-5, PMBOK® Guide pp. 265-266)
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Acquire Project Team: Introduction (Reference Manual p. 9-6, PMBOK® Guide p. 267)
• Is part of the executing process group • Involves getting the right people assigned to the project • Failure to do so in a timely manner may affect schedules, costs, risks, quality, and customer satisfaction • The project management team may or may not have direct control over team member selection
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Unit 9
Acquire Project Team (Reference Manual p. 9-6, PMBOK® Guide p. 267)
Inputs
Tools
Outputs
HR management plan
Pre-assignment
Project staff assignments
EEF
Negotiation
Resource calendars
OPA
Acquisition
Project management plan updates
Virtual teams Multi-criteria decision analysis
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Inputs to Acquire Project Team (Reference Manual p. 9-6, PMBOK® Guide p. 269)
• HR management plan: Identifies skill sets, quantities, and timing • EEF: • HR information:
Who is available and experience/skill set
Cost rate and level of interest in being on the project
• Personnel policies: How outsourcing is conducted • Organizational structure: Functional, matrix, or projectized • Location: Single or multiple, domestic or international
• OPA: HR procedures for staff assignments
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Tools for Acquire Project Team (Reference Manual p. 9-7, PMBOK® Guide pp. 270-272)
• Pre-assignment: • People promised by name in a competitive proposal • Key people assigned in the project charter
• Negotiation: Agreement with functional managers and other project teams about assignments (who you need and when)
• Acquisition: Procuring needed resources from outside the organization
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Unit 9
Tools for Acquire Project Team (Reference Manual p. 9-7, PMBOK® Guide pp. 270-272)
• Virtual teams: Teams that spend little or no time working face to face • Communication and conflict management especially important • Makes teaming possible in the following circumstances:
Members in different geographic areas, people who work from home or different shifts
To defray travel costs or to acquire special expertise not available locally
• Potential disadvantages of virtual teams:
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Difficulty sharing information, misunderstandings, feelings of isolation
Need for expensive communication technology
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Unit 9
Tools for Acquire Project Team (Reference Manual p. 9-7, PMBOK® Guide pp. 270-272)
• Multi-criteria decision analysis: Criteria used to rate or score potential team members • Availability, cost, experience • Ability, knowledge, skills • Attitude, international factors (location, time zones, language skills)
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Unit 9
Outputs from Acquire Project Team (Reference Manual p. 9-8, PMBOK® Guide p. 272)
• Project staff assignments: Publishing assignments using organizational charts and team directories
• Resource calendars: Documents time periods when resources can be used. Should anticipate changes due to— • Vacations, illness • Promotions, retirements • Needs of other projects
• Project management plan updates: Changes to the staffing plan • Team member lacks the right skill set or experience is lower than needed • Accident leads to loss of a team member 9- 23
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Develop Project Team: Introduction (Reference Manual p. 9-8, PMBOK® Guide p. 273)
• Is part of the executing process group • Improving project performance by improving competencies and team interaction
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Unit 9
Develop Project Team (Reference Manual p. 9-9, PMBOK® Guide p. 273)
Inputs
Tools
Outputs
HR management plan
Interpersonal skills
Team performance assessments
Project staff assignments
Training
EEF updates
Resource calendars
Team-building activities Ground rules Colocation Recognition and rewards Personnel assessment tools
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Unit 9
Develop Project Team: Key Points (Reference Manual p. 9-8, PMBOK® Guide pp. 273-274)
• Objectives of developing the project team: • Improve the ability of individual team members to contribute to the project • Improve the ability of the team to function effectively (teamwork, trust, cohesiveness, and collaborative problem solving) • Enhance project performance
• Team development is important throughout the entire project life cycle • Developing an effective team is a primary responsibility of the PM: • Motivation, team building, effective communication • Managing conflict, collaborative problem solving, and managing cultural diversity 9- 26
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Inputs to Develop Project Team (Reference Manual p. 9-9, PMBOK® Guide pp. 274-275)
• HR management plan: Provides guidance about team issues such as team building, rewards, training, and feedback
• Project staff assignments: Identifies the people on the team who may need development
• Resource calendars: Identifies when team members would be available for development activities • Team building • Training
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Tools for Develop Project Team (Reference Manual pp. 9-9 to 9-11, PMBOK® Guide pp. 275-278)
• Interpersonal skills: Behavioral competencies also called “soft skills” (remember the following list as “PLINCM”)
• Problem solving: Defining the problem, identifying alternatives, and making a timely decision
• Leadership: Developing a vision and strategy and motivating others to achieve that vision
• Influencing: Getting things done even though you may have limited formal power
• Negotiating and conflict management: Conferring with others to reach an agreement or to overcome a problem
• Communicating: The exchange of information • Motivating: “Energizing” people to high levels of performance 9- 28
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Tools for Develop Project Team (Reference Manual pp. 9-9 to 9-11, PMBOK® Guide pp. 275-278)
• Training: Formal (classroom) or informal (coaching or mentoring) to develop competence and enhance performance
• Team-building activities: Range from quick exercises during a meeting to professionally facilitated team sessions such as a ropes course • Objective: Develop rapport and trust, develop collaborative problem solving skills • Be familiar with the Tuckman model (or ladder): Identifies five stages teams experience in working together
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See next slide!
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Unit 9
Tools for Develop Project Team (Reference Manual pp. 9-9 to 9-11, PMBOK® Guide pp. 275-278)
• Tuckman model: Five stages of behavior experienced by project teams • Forming: Team meets and learns about the project. Members experience some confusion and uncertainty. Members are independent and not yet open to other members. • Storming: As work begins, members are committed to their own ideas and compete for assignments and control. Conflict between sub-groups may occur. • Norming: Members begin to adjust and support the team. Trust begins to develop. Ideas and information are shared. • Performing: Team functions as a cohesive, well organized unit. Issues are handled smoothly. • Adjourning: Team completes the project and begins to be reassigned. Separation anxiety may occur. • Note: Stages may be skipped or repeated or never achieved! 9- 30
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Tools for Develop Project Team (Reference Manual pp. 9-9 to 9-11, PMBOK® Guide pp. 275-278)
• Ground rules: The team establishes its own behavioral expectations and guidelines • Listening • Being on time • Taking personal responsibility for communication
• Colocation: Team members sit in the same physical vicinity • Also called a tight matrix • Enhances communication and team development • When colocation is not possible, a “war room” is recommended • A war room creates a better sense of identity with the project
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Tools for Develop Project Team (Reference Manual pp. 9-9 to 9-11, PMBOK® Guide pp. 275-278)
• Recognition and rewards: Actions that promote or reinforce desired behaviors • Project teams may need their own system (the organization may not directly support individual projects) • Examples: Access to education opportunities, a computer upgrade, time off
• Personnel assessment tools: Gaining insights into team strengths and weaknesses • Attitudinal surveys and structured interviews • Ability tests and focus groups
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Outputs from Develop Project Team (Reference Manual pp. 9-11 & 12, PMBOK® Guide pp. 278-279)
• Team performance assessments: Formal or informal assessments • Indicators of good team performance:
Project technical, schedule, and cost goals are met
Improvements occur in skills and team cohesion
Reduced turnover rates
• EEF updates: • Updates to employee training records • Skill assessments
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Unit 9
Manage Project Team: Introduction (Reference Manual p. 9-12, PMBOK® Guide p. 279)
• Is part of the executing process group • Involves tracking team performance, providing feedback, resolving issues, and managing team changes • Key skills in managing the team: • Communicating and negotiating • Managing conflict and leadership
• Managing the team is more complicated when members report to more than one boss (especially problematic in the matrix)
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Unit 9
Manage Project Team (Reference Manual p. 9-12, PMBOK® Guide p. 279)
Inputs
Tools
Outputs
HR management plan
Observation and conversation
Change requests
Project staff assignments
Project performance appraisals
Project management plan updates
Team performance assessments
Conflict management
Project documents updates
Issue log
Interpersonal skills
EEF updates
Work performance reports
OPA updates
OPA
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Inputs to Manage Project Team (Reference Manual pp. 9-12 & 13, PMBOK® Guide pp. 281-282)
• HR management plan: Addresses acquiring, managing, controlling, and releasing resources. Especially important information • Roles and responsibilities • Organizational structure • Staffing management plan
• Project staff assignments: The list of team members who may need performance reviews and who must be managed
• Team performance assessments: Assessment of the entire team’s performance as a group. Purpose: Deal with conflict and improve communication
• Issue log: Assigns responsibility to handle specific issues by a target date 9- 36
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Inputs to Manage Project Team (Reference Manual pp. 9-12 & 13, PMBOK® Guide pp. 281-282)
• Work performance reports: Documents actual performance against the following plans • Scope, schedule, cost • Quality and procurement
• OPA: OPA in this case identifies ways to show appreciation and reward people • Certificates of appreciation • Recognizing people’s work in newsletters and on websites • Financial bonuses • Corporate apparel, back-packs, briefcases • Special parking, window office, computer upgrade 9- 37
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Tools for Manage Project Team (Reference Manual pp. 9-13 to 9-17, PMBOK® Guide pp. 282-284)
• Observation and conversation: Techniques to be in touch with morale and feelings of the team
• MBWA: Management by walking around (get out of your office and interact with people)
• Project performance appraisals: The need for appraisals is affected by several factors • Policies on appraisals • Length of the project (will the appraisal come due?) • Organizational structure (PM has little input in a weak matrix)
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Tools for Manage Project Team (Reference Manual pp. 9-13 to 9-17, PMBOK® Guide pp. 282-284)
• Conflict management: Expect numerous potential questions on this topic • PMI survey: Top 7 sources of conflict (in order of likelihood)
Schedules
Priorities
Resources
Technical opinions
Administrative procedures
Costs
Personalities
• Conflict can be constructive:
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May increase creativity and lead to better decision making
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Tools for Manage Project Team (Reference Manual pp. 9-13 to 9-17, PMBOK® Guide pp. 282-284)
• Conflict management (continued): • Conflict should be:
Addressed early
Usually handled in private
Handled with a direct, collaborative approach
• There is a model created by Thomas and Kilmann with five methods for handling conflict: Technique Problem Solve/Collaborate
Description • Approached as a problem to be solved • Open exchange of information • Satisfy the needs of both parties, “win-win” • Issues are too important for compromise • Requires cooperation and commitment to a genuine search for the win-win solution
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Conflict Model (continued) (Reference Manual pp. 9-13 to 9-17, PMBOK® Guide pp. 282-284)
Technique Compromise/Reconcile
Description • Find solutions with a degree of satisfaction • Partial wins for each party • Concessions and trade-offs • Used as back-up when problem solving breaks down or running out of time • A temporary solution is needed • TK: Might result in lose-lose if solution not supported
Smooth/Accommodate
• Emphasizing areas of agreement vs. areas of disagreement • Conceding your position to maintain harmony • Used when a problem is threatening your ability to reach an agreement • Problem: The solution may be temporary
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Conflict Model (continued) (Reference Manual pp. 9-13 to 9-17, PMBOK® Guide pp. 282-284)
Technique Withdraw/Avoid
Description • Retreating temporarily from conflict • Used when belligerent, angry behavior threatens the agreement and relationship • Also used when the issue is not important enough to risk damaging the relationship
Force/Compete
• Offers only win-lose solutions • Pursuing your viewpoint at the expense of others • Used in an emergency or to protect your team from outside, forceful attack or pressure • Caution: May cause the following 2 problems • Create an enemy • Stalemate
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Tools for Manage Project Team (Reference Manual pp. 9-13 to 9-17, PMBOK® Guide pp. 282-284)
• Interpersonal skills: Getting the best from your team using these skills • Leadership: Creating a vision and the energy to achieve it • Influencing: Get things done when you lack formal authority • Decision making (Referred to earlier as problem solving)
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Outputs from Manage Project Team (Reference Manual p. 9-17, PMBOK® Guide pp. 284-285)
• Change requests: Staffing changes should be handled using the Integrated Change Control process
• Project management plan updates: The HR management plan may be updated
• Project documents updates: Includes potential updates to the issue log, roles description, and staff assignments
• EEF updates: • Inputs to performance appraisals • Personnel skill updates
• OPA updates: • Historical information, lessons learned, templates, standard processes 9- 44
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Other Topics (Reference Manual pp. 9-18 to 9-24, PMBOK® Guide No Reference)
• Other Topics covers information known to be on the real exam but not addressed by the PMBOK® Guide: • Power and authority • Motivation theories:
Hierarchy of needs, Theory X-Theory Y, Hygiene factors
Expectancy theory, Trichotomy of needs, Managerial grid
Myers-Briggs Type Indicator
• Leadership styles, Delegating, Resource Gantt chart • Kick-off meetings, Halo error, Concurrent engineering • Fringe benefits, Perquisites, Arbitration, Productivity
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Sources of Power and Authority for the PM (Reference Manual pp. 9-18 to 9-24, PMBOK® Guide No Reference)
• Legitimate/Formal: Derived from job title and position on organizational chart
• Technical/Expert: Technical knowledge of the product • Reward: Leverage via $ and other rewards • Referent: “Name dropping” (using someone else’s power) • Coercive or Penalty: Threats or retribution (use sparingly) • Bureaucratic: You know how to “work the system” and people owe you a favor
• Charisma: Interpersonal skills that elicit cooperation because people like you 9- 46
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Maslow’s Hierarchy of Needs (Reference Manual pp. 9-18 to 9-24, PMBOK® Guide No Reference)
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McGregor’s Theory X and Theory Y (Reference Manual pp. 9-18 to 9-24, PMBOK® Guide No Reference)
Theory X: • McGregor’s “traditional” view that workers are basically lazy • Appropriate management style: Strong, top-down control • “Man is not spontaneously fond of work” … Freud
Theory Y: • McGregor’s “social” view that workers are inherently motivated • Management style: Provide support, training, and a good work environment. The workers will do the rest
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Herzberg’s Hygiene Factors (Reference Manual pp. 9-18 to 9-24, PMBOK® Guide No Reference)
• Hygiene factors are working conditions such as: • Attitude of your boss • An adequate place to work • Being paid fairly compared to others doing the same work
• Inadequate attention to hygiene factors may lead to low morale, dissatisfaction, and outright anger • Conversely, satisfying these conditions is simply expected and will not directly produce high motivation in workers
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Vroom’s Expectancy Theory (Reference Manual pp. 9-18 to 9-24, PMBOK® Guide No Reference)
People will be productive and motivated IF: 1. They believe successful results are feasible or possible
AND 2. They believe a successful outcome will be rewarded
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McClelland’s Trichotomy of Needs (Reference Manual pp. 9-18 to 9-24, PMBOK® Guide No Reference)
Also called Needs-Achievement Index, addresses the following needs:
• Need for Achievement: • Prefer tasks with personal responsibility • Want results based on personal effort; not just good luck • Prefer prompt feedback on work results
• Need for Power: • Desire chance to wield power and influence over others • Seek positions with status and authority • May be more concerned about influence than work results
• Need for Affiliation: • Motivated by being liked and accepted • Will participate and support social events • May be uncomfortable with conflict 9- 51
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Unit 9
Blake and Mouton’s Managerial Grid (Reference Manual pp. 9-18 to 9-24, PMBOK® Guide No Reference)
Measures the following two aspects of how people lead:
• Concern for Production: • Leaders with a high concern for results or production • Concerned primarily about tasks and getting things done
• Concern for People: • Leaders with a high concern for feelings and morale • High concern for good workplace environment and employee comfort
Note: Effective leadership is combining these two factors in a balanced way and not over-emphasizing one dimension: • • • 9- 52
A 1,9 score (total concern for people) A 9,1 score (total concern for results) A 5,5 score (balanced approach)
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Unit 9
Myers-Briggs Type Indicator (Reference Manual pp. 9-18 to 9-24, PMBOK® Guide No Reference)
9- 53
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Leadership Styles (Reference Manual pp. 9-18 to 9-24, PMBOK® Guide No Reference)
Autocratic: • Leader makes decisions without input from others • Quick and efficient when you have all the facts • Not a good dominant style in some cultures
Laissez-faire: • “Leave be; let alone” • Good style with high-knowledge experts • Need clear objectives and support from boss, otherwise this style is passive and “hands-off”
Democratic: • A participative style • Leader seeks input and builds consensus • Voting may be involved 9- 54
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Delegating (Reference Manual pp. 9-18 to 9-24, PMBOK® Guide No Reference)
• Delegating is the process of distributing authority from the project manager to another person • You may delegate authority but not responsibility (the PM remains ultimately responsible) • Failure to delegate effectively is expensive and unproductive • Develops team skills • Improves productivity and morale
9- 55
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What Not to Delegate (Reference Manual pp. 9-18 to 9-24, PMBOK® Guide No Reference)
• Sensitive aspects of leadership: • Hiring • Firing • Pay • Organizational policies
• Management of key stakeholders
9- 56
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Resource Gantt Chart (Reference Manual pp. 9-18 to 9-24, PMBOK® Guide No Reference)
• Uses the structure of a traditional Gantt chart: The task and the timing
• Adds assigned resources to the display: The result is “who does what and when”
• Recall earlier we said the RAM did not show timing: The resource Gantt chart shows everything (who, what, when)
9- 57
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Kick-Off Meetings (Reference Manual pp. 9-18 to 9-24, PMBOK® Guide No Reference)
• Kick-off meetings are the responsibility of the PM • This question sometimes asked as a negative: Which is not… • PMI list of objectives for kick-off meetings: • Introduce team members • Establish working relationships • Establish lines of communication • Set/review goals and objectives • Review project status • Review project management plan • Identify problems and issues • Establish responsibilities and accountabilities • Obtain commitments 9- 58
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Halo Error and Concurrent Engineering (Reference Manual pp. 9-18 to 9-24, PMBOK® Guide No Reference)
• Halo error: Rating someone consistently high or low based on preconceived notions
• Concurrent engineering: • Overlapping tasks and phases in a project • Forming a multi-disciplinary core team early in the project • More work done in parallel and fewer late changes • Technique has proven track record in reducing costs and improving schedules
9- 59
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Definitions (Reference Manual pp. 9-18 to 9-24, PMBOK® Guide No Reference)
• Fringe benefits: Standard items provided to employees • Education, training, profit sharing • Medical benefits, employer matching of social security payments
• Perquisites (“perks”): Special awards only for select people • Executive dining room and company car • A corner office and special parking place
• Arbitration: Disputes heard by a neutral third party • Productivity: A ratio of output divided by input • Usable items produced divided by hours of labor
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Drill Practice Reminder
Drill practice for this chapter starts on p. 9-25
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Unit 10
COMMUNICATIONS MANAGEMENT
10-1
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Unit 10
Communications Management Concept (Reference Manual p. 10-1, PMBOK® Guide p. 287)
• Communications management includes the processes required to ensure timely handling of information: • Planning • Managing:
Creating
Distributing
Storing
Retrieving
Disposing
• Controlling
10-2
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Unit 10
Communications Management: Key Points (Reference Manual p. 10-1, PMBOK® Guide p. 287)
• Dimensions of communicating: • Written and oral • Formal and informal • Verbal (voice inflection) and non-verbal (body language) • Internal (within the project) and external (outside the project) • Vertical (bosses, subordinates) and horizontal (peers) • Official (published reports) and unofficial (off the record) • Note: Written-oral and formal-informal will receive special attention in the Other Topics section of the unit!
10-3
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Unit 10
Communication Skills for Project Managers (Reference Manual p. 10-2, PMBOK® Guide p. 288)
• Active listening • Paraphrasing, repeating what you think the sender meant
• Questioning and probing • Educating to increase the team’s knowledge • Fact-finding and managing expectations • Persuading, motivating, and coaching others • Negotiating and resolving conflict • Summarizing, recapping, and identifying next steps
10-4
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Unit 10
Overview of Topics in Unit 10 • Communications Management Processes • Other Topics • Information that has been tested but is not covered by the PMBOK® Guide.
• Drill Practice
10-5
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Unit 10
Overview of Communications Management Processes (Reference Manual p. 10-1, PMBOK® Guide p. 287)
10.1 Plan Communications Management (determining the information needs of stakeholders and defining a communication approach)
10.2 Manage Communications (creating, collecting, distributing, storing, retrieving, and disposing of project information in accordance with the plan)
10.3 Control Communications (ensuring the information needs of stakeholders are actually met)
10-6
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Unit 10
Selected Knowledge Area, Process Groups, and Processes (Reference Manual p. 3-7, PMBOK® Guide pp. 60-61)
Process Groups Knowledge Areas
Initiating
Planning
Executing
Controlling
• Plan communications management
• Manage communications
• Control Communications
Closing
Integration Scope Time Cost Quality HR Communication
Risk Procurement Stakeholder
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Unit 10
Plan Communications Management: Introduction (Reference Manual p. 10-2, PMBOK® Guide p. 289)
• Is part of the planning process group • Involves discovering information needs of stakeholders and devising an appropriate communication plan • The communication plan should address: • Who needs what information • When they need it • How they will get it • Who will give it to them
• Communication planning should be done early in the project and reviewed regularly 10-8
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Effective vs. Efficient Communication (Reference Manual p. 10-2, PMBOK® Guide p. 290)
• Effective communication: • Information to the right audience • At the right time • In the right format
• Efficient communication: • Providing only the information needed • Avoiding information overload
10-9
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Plan Communications Management (Reference Manual p. 10-3, PMBOK® Guide p. 289)
Inputs
Tools
Outputs
Project management plan
Communication requirements analysis
Communications management plan
Stakeholder register
Communication technology
Project documents updates
EEF
Communication models
OPA
Communication methods Meetings
Note: EEF = Enterprise Environmental Factors OPA = Organizational Process Assets 10-10
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Inputs to Plan Communications Management (Reference Manual p. 10-3, PMBOK® Guide p. 290)
• Project management plan: Describes how the project will be executed, monitored, controlled, and closed
• Stakeholder register: Identifies potentially important stakeholders • EEF: All 13 factors are potentially relevant to communication planning • OPA: All OPA information is potentially relevant (standard procedures and knowledge base) • Historical information and lessons learned are especially important
10-11
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Unit 10
Tools for Plan Communications Management (Reference Manual pp. 10-3 to 10-6, PMBOK® Guide pp. 291-295)
• Communication requirements analysis: Determines the information needed by stakeholders • Focus on information really needed • Avoid information overload and distracting minutiae • Understand the number of communication channels you must support • The number of channels is a measure of communication complexity • Know that communication channels increase at greater than a linear rate
10-12
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Unit 10
Communication Channel Example (Reference Manual pp. 10-3 to 10-6, PMBOK® Guide pp. 291-295)
10-13
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Unit 10
Communication Channels: More Examples (Reference Manual pp. 10-3 to 10-6, PMBOK® Guide pp. 291-295)
• You had 21 members on your project team and you just lost 5 of them. How many fewer channels do you now have? • Calculate the number of channels for 21 people • Calculate the number of channels for 16 people and determine the difference • Answer: ________
• You had 17 members on your project team and you just lost 4 of them. A new stakeholder just raised an important issue. How many communication channels do you now have to maintain? • The new number of people is: 17-4+1 = 14 people • Calculate the number of channels for 14 people • Answer: ________ 10-14
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Unit 10
Tools for Plan Communications Management (Reference Manual pp. 10-3 to 10-6, PMBOK® Guide pp. 291-295)
• Communication technology: Methods used to transfer information • Can be low tech: Conversations and meetings • Can be high tech: Automated, computerized • Factors in choosing appropriate technology: Urgency and technology already in use (is it sufficient?) Availability and ease of use Project environment (a virtual team might require advanced technologies) Sensitivity and need for confidentiality
10-15
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Unit 10
Tools for Plan Communications Management (Reference Manual pp. 10-3 to 10-6, PMBOK® Guide pp. 291-295)
• Communication models: PMI describes the following basic model • Encode: Sender encodes thoughts into a message • Transmit message: Send message using appropriate medium (voice, letter, email, …) “Noise” is anything that interferes with receipt or understanding • Decode: Receiver translates message • Acknowledge: Receiver acknowledges receipt Receipt of a message does not equal agreement or understanding • Feedback/Response: Response to the sender • Note: A PMI survey found project managers spend up to 90% of their time communicating and handling information
10-16
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Unit 10
Communication Models: Other Information (Reference Manual pp. 10-3 to 10-6, PMBOK® Guide pp. 291-295)
• Sender is responsible for: • Making the information clear, unambiguous, and complete • Confirming receiver’s understanding
• Receiver is responsible for: • Making sure the entire message was received • Confirming accurate understanding (active listening is recommended)
• Other notes: • Formal communication is best in writing • Advantages of verbal communication: Fast and immediate feedback is possible Supports brainstorming of a complex problem 10-17
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Communication Models: Effective Listening (Reference Manual pp. 10-3 to 10-6, PMBOK® Guide pp. 291-295)
• Effective listening includes: • Asking for clarification • Repeating what you heard • Observing body language (non-verbal clues) • Maintaining eye contact
10-18
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Unit 10
Tools for Plan Communications Management (continued) (Reference Manual pp. 10-3 to 10-6, PMBOK® Guide pp. 291-295)
• Communication methods: PMI identifies three methods for sharing information • Interactive communication: Multi-directional, two or more parties, quick and efficient • Push communication: Information sent to specific recipients, does not ensure receipt • Pull communication: Posting information so that it can be accessed (“pulled”) when needed
• Meetings: • Used to resolve problems and make decisions • Meetings should be adequately planned: Purpose, agenda, time, place, etc.
10-19
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Unit 10
Outputs from Plan Communications Management (Reference Manual pp. 10-6 & 7, PMBOK® Guide pp. 296-297)
• Communications management plan: Documents how information will be handled and contains— • Stakeholder communication requirements • Information to be communicated • Purpose for the information • Senders, receivers, format, medium, technology • Frequency and method for updates • Escalation process • Information flows and glossary of terms
10-20
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Unit 10
Outputs from Plan Communications Management (Reference Manual pp. 10-6 & 7, PMBOK® Guide pp. 296-297)
• Project documents updates: • Project schedule • Stakeholder register
10-21
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Unit 10
Manage Communications: Introduction (Reference Manual p. 10-7, PMBOK® Guide p. 297)
• Is part of the executing process group • Involves creating, collecting, distributing, storing, retrieving, and disposing of information in accordance with the plan • Ensures relevant information is: • Distributed • Received • Understood
• Allows response to follow-on requests for information
10-22
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Unit 10
Manage Communications (Reference Manual p. 10-7, PMBOK® Guide p. 297)
Inputs
Tools
Outputs
Communications management plan
Communication technology
Project communications
Work performance reports
Communication models
Project management plan updates
EEF
Communication methods
Project documents updates
OPA
Information management systems
OPA updates
Performance reporting
10-23
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Manage Communications: Key Points (Reference Manual p. 10-7, PMBOK® Guide pp. 297-299)
• Effective communication uses the following: • Sender-receiver models • Appropriate media • Writing style and presentation techniques • Meeting management • Facilitation techniques • Listening techniques
10-24
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Unit 10
Inputs to Manage Communications (Reference Manual pp. 10-7 & 8, PMBOK® Guide pp. 299-300)
• Communications management plan: Describes how communications will be planned, structured, monitored, and controlled
• Work performance reports: Used to collect and distribute project status; the information should be accurate and current
• EEF: • Organizational structure, regulations and standards • Information system
• OPA: • Policies, procedures, and templates • Historical information and lessons learned
10-25
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Tools for Manage Communications (Reference Manual pp. 10-8 & 9, PMBOK® Guide pp. 300-301)
• Communication technology: Choosing appropriate communication technologies
• Communication models: Selecting and using appropriate communication models • Managing communication barriers and noise
• Communication methods: The use of interactive, push, and pull methods
10-26
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Unit 10
Tools for Manage Communications (Reference Manual pp. 10-8 & 9, PMBOK® Guide pp. 300-301)
• Information management systems: Distributing information using— • Hard copy documents: Letters, memos, and reports • Electronic communications: E-mail, voice mail, telephone, video and web conferencing • Electronic project management tools: Project management software, portals, and collaborative work management tools
• Performance reporting: Analyzing the difference between planned status and actual status (identifying variances and taking corrective action) • Reporting by exception is recommended (avoid information overload) • Three major types of reports: Status reports (analyzing variances) Progress reports (listing deliverables completed) Forecasts (predicting future status using measures such as EAC) 10-27
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Unit 10
Outputs from Manage Communications (Reference Manual pp. 10-9 & 10, PMBOK® Guide pp. 301-303)
• Project communications: Typical communications may include • Performance reports, status of deliverables • Status of schedules, costs, and changes
• Project management plan updates: Actual performance outcomes may dictate changes in three areas of the plan • Project baselines (scope, schedule, cost) • Communications management • Stakeholder management
10-28
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Unit 10
Outputs from Manage Communications (Reference Manual p. 10-9 & 10, PMBOK® Guide pp. 301-303)
• Project documents updates: • Issue log • Project schedule • Funding requirements
• OPA updates: • Lessons learned documentation • Project records, reports, and presentations • Information provided to stakeholders • Feedback from stakeholders
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Unit 10
Control Communications: Introduction (Reference Manual p. 10-10, PMBOK® Guide p. 303)
• Is part of the monitoring and controlling process group • Ensures the information needs of stakeholders are met effectively and efficiently • May result in iterations of the previous planning and managing processes to make appropriate adjustments • Ultimate goal: Deliver the right message to the right people at the right time
10-30
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Unit 10
Control Communications (Reference Manual p. 10-10, PMBOK® Guide p. 303)
Inputs
10-31
Tools
Outputs
Project management plan
Information management systems
Work performance information
Project communications
Expert judgment
Change requests
Issue log
Meetings
Project management plan updates
Work performance data
Project documents updates
OPA
OPA updates
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Inputs to Control Communications (Reference Manual pp. 10-10 & 11, PMBOK® Guide pp. 304-306)
• Project management plan: Contains the communications management plan with the following important information • Stakeholder communication requirements • Reason, timing, and frequency for required information • Who communicates the information • Who receives the information
• Project communications: Provides the status of deliverables, schedules, and costs
• Issue log: Assigns an action, owner, and target date for resolution
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Inputs to Control Communications (Reference Manual pp. 10-10 & 11, PMBOK® Guide pp. 304-306)
• Work performance data: Organizes raw performance data so that actual outcomes can be compared to planned baselines
• OPA: • Report templates and communication technologies • Policies, standards, and procedures • Communication media • Record retention and security requirements
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Tools for Control Communications (Reference Manual p. 10-11, PMBOK® Guide pp. 306-307)
• Information management systems: Provides a standard set of tools that use distribution formats such as— • Table reports and spreadsheet analysis • Presentations • Graphical methods to visually present project performance data
• Expert judgment: Technical and management knowledge to determine the need for intervention and action plans
• Meetings: Provide a forum for discussing project performance and responding to stakeholders
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Unit 10
Outputs from Control Communications (Reference Manual p. 10-12, PMBOK® Guide pp. 307-308)
• Work performance information: Summarizes performance data, usually in the areas of scope, schedule, and cost
• Change requests: Controlling communications may result in the need for intervention, action, and adjustment • Always use Perform Integrated Change Control to process changes • Changes may lead to: Revisions to activities, schedules, costs, resources, and risks Updates to the project plan Recommendations for corrective or preventive actions
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Unit 10
Outputs from Control Communications (Reference Manual p. 10-12, PMBOK® Guide pp. 307-308)
• Project management plan updates: May update the human resource, communications, or stakeholder management plans
• Project documents updates: May update forecasts, issue logs, and performance reports
• OPA updates: Adding any new lessons learned to the OPA knowledge base
10-36
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Unit 10
Other Topics (Reference Manual pp. 10-12 to 10-14, PMBOK® Guide No Reference)
• Other Topics covers information known to be on the real exam but not addressed by the PMBOK® Guide: • Barriers to communication • Improving team communication (six actions) • Roles for a meeting chairperson • Documentation • Organizational structure and complexity of communication • Formal-informal combined with written-oral
10-37
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Unit 10
Barriers to Communication (Reference Manual pp. 10-12 to 10-14, PMBOK® Guide No Reference)
• Cultural differences • Lack of clear communication channels • Physical and temporal distance (time zones) • Technical language • Distracting environment (noise, temperature) • Poor attitudes (antagonism) • Note: The presence of any communication barriers increases the chance of conflict!
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Unit 10
Six Actions to Improve Team Communications (Reference Manual pp. 10-12 to 10-14, PMBOK® Guide No Reference)
• Be an effective communicator: • Foster 2-way communication including feedback and consensus • PMI: Effective communicators have high regard for the opinions and feelings of other people
• Be a Communications expeditor: • Use both formal and informal channels • Enhances project integration
• Discourage communications blockers: • It’ll never work, the boss won’t buy it • Get real, That’s nice but it’s too expensive • We tried that…it didn’t work 10-39
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Six Actions to Improve Team Communications (Reference Manual pp. 10-12 to 10-14, PMBOK® Guide No Reference)
• Use a tight matrix: Not the same as weak or strong matrix! • Physical colocation of the team • Improves communication, enhances team relationships, minimizes distractions
• Get a project war room: • A room assigned to the team for the duration of the project • Improves identity with the team
• Make meetings effective: Have good meeting policies (PALM) • Communicate the Purpose, have and follow an Agenda • Communicate length, location, other Logistics • Publish Minutes and consider team building 10-40
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Roles for the Meeting Chairperson (Reference Manual pp. 10-12 to 10-14, PMBOK® Guide No Reference)
• Encourage participation: Ensure quiet people are heard • Handle differences of opinion • Prevent drift and disruption: Use and enforce an agenda • Periodically summarize key issues: Be the gatekeeper who keeps the meeting on track
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Unit 10
The Role of Good Documentation (Reference Manual pp. 10-12 to 10-14, PMBOK® Guide No Reference)
• Documentation is important regardless of project size • Disciplined documentation will reduce unauthorized changes in scope • Project management plan especially important: • The analysis in preparing the plan actually reduces uncertainty • Distributing the plan keeps stakeholders informed
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Unit 10
Organizational Structure (Reference Manual pp. 10-12 to 10-14, PMBOK® Guide No Reference)
• One challenge of the matrix organizational structure: • The communication and information flows are more complex than for projectized or functional structures
10-43
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Unit 10
Formal-Informal vs. Written-Oral Communications (Reference Manual pp. 10-12 to 10-14, PMBOK® Guide No Reference)
Method
10-44
When Used
Formal, Written
• Contractual issues • Project documentation • Some e-mails
Formal, Oral
• Presentations • Speeches • Some meetings
Informal, Written
• Memos • Notes • Some e-mails
Informal, Oral
• Conversations • Some meetings
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Unit 10
Drill Practice Reminder
Drill practice for this chapter starts on p. 10-15
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Unit 11
RISK MANAGEMENT
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Unit 11
Risk Management Concept (Reference Manual p. 11-1, PMBOK® Guide p. 309)
• Risk management includes the processes concerned with planning, identifying, analyzing, responding, and controlling project risks • Objectives: • Increase likelihood and impact of positive events • Decrease likelihood and impact of negative events
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Unit 11
Risk Management: Key Points (Reference Manual pp. 11-1 & 2, PMBOK® Guide pp. 309-311)
• Risk: An uncertain event that could have a positive or a negative effect on the project
• Known risks: Have been identified and can be managed • May be assigned a contingency reserve
• Unknown risks: Cannot be adequately understood in advance • May be assigned a management reserve
• Risk management: Identifying, analyzing, and responding to project risks • Failure to proactively manage risks increases the chance of failure
11-3
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Unit 11
Risk Management: Key Points (Reference Manual pp. 11-1 & 2, PMBOK® Guide pp. 309-311)
• Utility theory or utility function: Balancing a risk against the potential reward • Also called risk tolerance or preference • Some organizations are likely to take risk while others prefer to avoid it
• Uncertainty vs. risk: PMI defines uncertainty as a lack of information that makes it difficult to estimate the likelihood of an event
• Risk factors: • Risk event (description of what might happen to the project) • Risk probability (the likelihood that the event will occur) • Amount at stake (the magnitude of the loss or gain)
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Unit 11
Business Risk vs. Insurable Risk (Reference Manual pp. 11-1 & 2, PMBOK® Guide pp. 309-311)
Business Risk
Insurable Risk
• The normal risk of doing business
• Protecting from injury or property damage
• Opportunity for gain or loss
• Only an opportunity for loss
• Should be managed:
• Should be insured:
Plan
Property damage (fire, flood, wind)
Identify
Indirect loss (cost of cleanup after a loss)
Qualitative analysis Quantitative analysis Response
Legal liability (injury to visitors) Personal injury (employee injuries, worker compensation)
Control
11-5
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Unit 11
Overview of Topics in Unit 11 • Risk Management Processes • Other Topics • Information that has been tested but is not covered by the PMBOK® Guide.
• Drill Practice
11-6
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Unit 11
Overview of Risk Management Processes (Reference Manual p. 11-1, PMBOK® Guide p. 287)
11.1 Plan Risk Management (defining how to conduct risk management activities)
11.2 Identify Risks (determining which risk events might affect the project) 11.3 Perform Qualitative Risk Analysis (performing qualitative analysis and prioritizing of risks)
11.4 Perform Quantitative Risk Analysis (numerically analyzing identified risks)
11.5 Plan Risk Responses (deciding how to enhance opportunities and reduce threats)
11.6 Control Risks (identifying new risks, tracking identified risks, implementing risk response plans, and evaluating risk management effectiveness) 11-7
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Unit 11
Selected Knowledge Area, Process Groups, and Processes (Reference Manual p. 3-7, PMBOK® Guide pp. 60-61)
Process Groups Knowledge Areas
Initiating
Planning
Executing
Controlling
Closing
Integration Scope Time Cost Quality HR Communication • Plan risk management • Identify risks • Qualitative analysis • Quantitative analysis • Plan risk responses
Risk
• Control risks
Procurement Stakeholder 11-8
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Unit 11
Plan Risk Management: Introduction (Reference Manual p. 11-3, PMBOK® Guide p. 313)
• Is part of the planning process group • Involves deciding how to conduct risk management activities for the project • The risk management plan is important: • For establishing communication with stakeholders • Obtaining continuing support from stakeholders
• Risk planning should begin during project initiation and be completed early during the planning process
11-9
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Unit 11
Plan Risk Management (Reference Manual p. 11-3, PMBOK® Guide p. 313)
Inputs
Tools
Project management plan
Analytical techniques
Project charter
Expert judgment
Stakeholder register
Meetings
Outputs Risk management plan
EEF OPA
Note: EEF = Enterprise Environmental Factors OPA = Organizational Process Assets 11-10
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Unit 11
Inputs to Plan Risk Management (Reference Manual pp. 11-3 & 4, PMBOK® Guide pp. 314-315)
• Project management plan: All subsidiary management plans must be taken into account so that the risk management plan is consistent
• Project charter: Identifies high-level risks and requirements • Stakeholder register: Identifies potentially important stakeholders who may have concerns or information relevant to project risks
• EEF: Risk attitudes and tolerances within the organization • OPA: • Risk categories, risk statement formats, and standard templates • Roles, responsibilities, and common definitions • Lessons learned and authority levels for decisions 11-11
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Unit 11
Tools for Plan Risk Management (Reference Manual p. 11-4, PMBOK® Guide pp. 315-316)
• Analytical techniques: Used to understand the overall risk management context • Risk context is a combination of risk attitudes and risk exposure • A risk profile analysis documents stakeholder risk attitudes • Risk scoring sheets could quantify the risk exposure of the project
• Expert judgment: Used to improve the risk management plan • Meetings: Planning meetings attended by key stakeholders • Develop the risk management plan • Estimate contingency and reserve amounts, assign risk responsibilities • Develop risk templates 11-12
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Unit 11
Outputs from Plan Risk Management (Reference Manual p. 11-5, PMBOK® Guide pp. 316-318)
• Risk management plan: Documents how risk identification, qualitative and quantitative analysis, response planning, and control will be handled • Methodology, roles, and responsibilities • Budgeting and timing • Risk categories (may use a risk breakdown structure, RBS) • Definitions of probability and impact • Probability and impact matrix • Revised stakeholder tolerances • Reporting formats and tracking
11-13
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Unit 11
Identify Risks: Introduction (Reference Manual p. 11-5, PMBOK® Guide p. 319)
• Is part of the planning process group • Determining which risk events are likely to affect the project • Risk identification is an iterative process (not a one-time event) • The risk statement should allow comparison of the relative effect of various risk events • The project team should be involved to develop a sense of ownership
11-14
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Unit 11
Identify Risks (Reference Manual p. 11-6, PMBOK® Guide p. 319)
Inputs
Tools
Risk management plan
Documentation reviews
Cost management plan
Information gathering techniques
Schedule management plan
Checklist analysis
Quality management plan
Assumptions analysis
HR management plan
Diagramming techniques
Scope baseline
SWOT analysis
Activity cost estimates
Expert judgment
Outputs Risk register
Activity duration estimates Stakeholder register Project documents Procurement documents EEF OPA 11-15
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Unit 11
Inputs to Identify Risks (Reference Manual pp. 11-6 to 11-8, PMBOK® Guide pp. 321-324)
• Risk management plan: Assigns roles and responsibilities, establishes required budget and schedule for risk management activities
• Cost management plan: Establishes how cost reserves will be handled • Schedule management plan: Requires duration estimates with ranges and addresses how schedule reserves will be handled
• Quality management plan: May provide information about technical risks • HR management plan: May provide information about human resource risks
11-16
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Unit 11
Inputs to Identify Risks (Reference Manual pp. 11-6 to 11-8, PMBOK® Guide pp. 321-324)
• Scope baseline: Contains the scope statement and the WBS • The scope statement documents assumptions (which may pose risks) • One use of the WBS is risk identification (by work package)
• Activity cost estimates: Estimates with wider cost ranges are more risky • Activity duration estimates: Estimates with wider ranges indicate work that is inherently more risky
• Stakeholder register: Stakeholders may provide information about risks • Project documents: Documents aimed at improving team communication • Project charter, project schedules, issue log • Quality checklist and any other miscellaneous information 11-17
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Unit 11
Inputs to Identify Risks (Reference Manual pp. 11-6 to 11-8, PMBOK® Guide pp. 321-324)
• Procurement documents: Helps assess outsourcing risks • EEF: • Published information, including commercial databases • Academic and industry studies • Benchmarking and organizational risk attitudes
• OPA: • Project files (historical data) • Risk statement templates • Lessons learned
11-18
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Unit 11
Tools for Identify Risks (Reference Manual pp. 11-8 & 9, PMBOK® Guide pp. 324-327)
• Documentation reviews: A structured review of all subsidiary management plans (scope, schedule, cost, …)
• Information-gathering techniques: • Brainstorming: Generates, refines, and categorizes risk information • Delphi technique: Experts answer questions anonymously and the results are summarized Objective: Reach consensus among the experts after several iterations • Interviewing: Conducted by experienced subject matter experts • Root cause analysis: Grouping risks by cause or category
11-19
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Unit 11
Tools for Identify Risks (Reference Manual pp. 11-8 & 9, PMBOK® Guide pp. 324-327)
• Checklist analysis: Uses information from previous, similar projects • Allows the creation of customized lists on the likely sources of risk: Technology, cost, schedule, internal, external Procurement, legal, poor planning, changes in requirements
• Assumptions analysis: Re-examining the validity of all assumptions • Diagramming techniques: • Cause and effect diagrams (Ishikawa, Fishbone) • Flowcharts (process or system) • Influence diagrams (graphical depictions of possible causal influences)
11-20
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Unit 11
Tools for Identify Risks (Reference Manual pp. 11-8 & 9, PMBOK® Guide pp. 324-327)
• SWOT analysis: Strengths, Weaknesses, Opportunities, Threats • Considers risk from multiple perspectives • Also considers both positive and negative factors
• Expert judgment: The use of subject matter experts with experience on similar projects
11-21
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Unit 11
Outputs from Identify Risks (Reference Manual p. 11-9, PMBOK® Guide p. 327)
• Risk register: The risk register (database) is built in stages • New information is added as each process is performed • At this point, the risk register contains: A list of potential risk events A list of potential responses (if known from previous experience) • Risk triggers may also be developed:
11-22
A symptom or warning sign that a risk is about to occur
Example: You are concerned about cost risk and decide to track the CPI. The CPI must remain within an established threshold or a corrective action is triggered.
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Unit 11
Perform Qualitative Risk Analysis: Introduction (Reference Manual p. 11-10, PMBOK® Guide p. 328)
• Is part of the planning process group • Assesses the likelihood and impact of identified risks • Objective: Prioritize the risks and determine whether the project is facing high risks • This technique uses qualitative methods and tools • By comparison, the next process (quantitative analysis) uses more rigorous statistical methods such as simulations and decision trees
11-23
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Unit 11
Perform Qualitative Risk Analysis (Reference Manual p. 11-10, PMBOK® Guide p. 328)
Inputs
Tools
Risk management plan
Risk probability and impact assessment
Scope baseline
Probability and impact matrix
Risk register
Risk data quality assessment
EEF
Risk categorization
OPA
Risk urgency assessment
Outputs Project documents updates
Expert judgment
11-24
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Unit 11
Inputs to Perform Qualitative Risk Analysis (Reference Manual pp. 11-10 & 11, PMBOK® Guide pp. 329-330)
• Risk management plan: Assigns roles and responsibilities as well as monetary and time resources to accomplish risk management
• Scope baseline: The scope statement provides insight into the basic nature of the project • Some projects are inherently risky: Technology developments Projects with high complexity
• Risk register: • The list of risk events identified during the previous process
11-25
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Unit 11
Inputs to Perform Qualitative Risk Analysis (Reference Manual pp. 11-10 & 11, PMBOK® Guide pp. 329-330)
• EEF: • Industry studies of similar projects • Risk databases from industry or proprietary sources
• OPA: • Risks on similar projects (historical information) • Lessons learned
11-26
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Unit 11
Tools for Perform Qualitative Risk Analysis (Reference Manual p. 11-11, PMBOK® Guide pp. 330-333)
• Risk probability and impact assessment: • Probability is the likelihood an event will occur • Impact is the effect on project objectives if the event actually occurs • These assessments are determined through interviews and meetings
• Probability and impact matrix: Assigns risk ratings based on combined probability and impact scores • Each risk event is classified as high, moderate, or low risk • The risk score helps guide risk responses • See the next slide for a visual example
• Risk Data Quality Assessment: The quality of the risk data is related directly to previous experience with similar projects 11-27
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Unit 11
Probability and Impact Matrix (Reference Manual p. 11-11, PMBOK® Guide pp. 330-333)
11-28
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Unit 11
Tools for Perform Qualitative Risk Analysis (Reference Manual p. 11-11, PMBOK® Guide pp. 330-333)
• Risk categorization: The RBS (risk breakdown structure) groups related risks into categories
• Risk urgency assessment: Some risks require immediate, near-term responses
• Expert judgment: Used to more accurately assess probability and impact for each risk event
11-29
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Unit 11
Outputs from Perform Qualitative Risk Analysis (Reference Manual pp. 11-11 & 12, PMBOK® Guide p. 333)
• Project documents updates: Updating the risk register and assumptions log • Risk rankings of the overall project and individual risk events • Information updated includes probabilities, impacts, category, and urgency • Risks that may require additional analysis • A watch list is created for low risks that may require future monitoring
11-30
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Unit 11
Perform Quantitative Risk Analysis: Introduction (Reference Manual p. 11-12, PMBOK® Guide p. 333)
• Is part of the planning process group • Similar to qualitative analysis, this process assesses the combined effects of probability and impact • The major difference is in the methods and tools used in the analysis • Quantitative analysis uses more rigorous statistical methods such as simulation, decision trees, and expected monetary value • PMI says some projects do not need this level of sophisticated analysis 11-31
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Unit 11
Perform Quantitative Risk Analysis (Reference Manual p. 11-12, PMBOK® Guide p. 334)
Inputs
Tools
Risk management plan
Data gathering and representation techniques
Cost management plan
Quantitative risk analysis and modeling techniques
Schedule management plan
Expert judgment
Outputs Project documents updates
Risk register EEF OPA
11-32
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Unit 11
Perform Quantitative Risk Analysis: Key Points (Reference Manual p. 11-12, PMBOK® Guide pp. 334-335)
• Monte Carlo simulation and decision tree analysis permit the following: • Determine the probability that specific cost and schedule objectives can be met • Quantify risk exposure to determine the amount of cost and schedule reserves • Identify which risks require the most attention • Identify realistic cost, schedule, and technical performance targets • Determine how much reserve is needed to protect against cost and schedule overruns
11-33
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Unit 11
Inputs to Perform Quantitative Risk Analysis (Reference Manual p. 11-13, PMBOK® Guide pp. 335-336)
• Risk management plan: Establishes roles, responsibilities, budget, and time needed to accomplish risk management activities
• Cost management plan: Provides guidelines for handling risk reserves • Schedule management plan: Provides guidelines for handling risk reserves
• Risk register: Provides information from all previous processes— • List of identified risks • Risk priorities from qualitative analysis • Risk categories
11-34
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Unit 11
Inputs to Perform Quantitative Risk Analysis (Reference Manual p. 11-13, PMBOK® Guide pp. 335-336)
• EEF: • Industry studies of similar projects • Risk databases from industry groups or proprietary sources
• OPA: • Information from previous, similar projects
11-35
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Unit 11
Tools for Perform Quantitative Risk Analysis (Reference Manual pp. 11-13 to 11-15, PMBOK® Guide pp. 336-341)
• Data gathering and representation techniques: • Interviewing: Collecting data from subject matter experts to build probability distributions Similar to the idea of optimistic, most likely, and pessimistic estimates in PERT
• Probability distributions: The outcome of interviewing is establishing distributions such as normal, uniform, beta, and triangular
11-36
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Unit 11
Tools for Perform Quantitative Risk Analysis (Reference Manual pp. 11-13 to 11-15, PMBOK® Guide pp. 336-341)
• Quantitative risk analysis and modeling techniques: • Sensitivity analysis: Determines which risks have the most potential impact on the project Similar to the idea of optimistic, most likely, and pessimistic estimates in PERT Example: What is the effect on costs, quality, and resource usage if task duration varies? Tornado diagrams compare the relative impact of variables with a high range of uncertainty to those that are more stable Tornado diagrams also identify which risk events have positive impacts that are greater than the potential negative impact An example: PMBOK Guide, Figure 11-15, p. 338
11-37
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Unit 11
Tools for Perform Quantitative Risk Analysis (Reference Manual pp. 11-13 to 11-15, PMBOK® Guide pp. 336-341)
• Quantitative risk analysis and modeling techniques (continued): • Expected monetary value (EMV): Calculates average outcome for future uncertain scenarios EMV = Probability of outcome multiplied by value of the outcome Outcomes may be positive (gains) or negative (losses) EMV is used as part of decision tree analysis See examples of EMV in the following six slides
• Modeling and simulation: Using a computer software model to simulate possible project outcomes Most common form is Monte Carlo Can quantify potential risks, e.g. schedule and cost Produces a distribution of possible outcomes with probabilities CPM and PERT understate durations and are too optimistic compared to Monte Carlo analysis Simulation results are affected by the statistical distribution used 11-38
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EMV Example #1 (Reference Manual pp. 11-13 to 11-15, PMBOK® Guide pp. 336-341)
You are on vacation and have some “mad money” to spend at the Aces and Eights Casino. You decide to play the following game: You wager $25 on the chance of winning $1,000 or $100 or losing your money. With the following data in mind, is the game a good idea financially?
Outcome
Probability
EMV
Win $1,000
1%
$10.00
Win $100
9%
$9.00
Lose $25
90%
-$22.50
Overall EMV:
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-$3.50
© 2015 CMF Solutions and TwentyEighty Strategy Execution, All Rights Reserved
Unit 11
EMV Example #2 (Reference Manual pp. 11-13 to 11-15, PMBOK® Guide pp. 336-341)
You are attempting to prioritize the potential effects of several risk events. Your boss wants to know which risk is the most important to manage carefully. You decide to use EMV to calculate the expected losses from each event. With the following data, which risk event poses the greatest financial risk in Euros?
Risk Event
Probability
Expected Loss
EMV
A
25%
-€2,000,000
-€500,000
B
70%
-€450,000
-€315,000
C
55%
-€1,250,000
-€687,500
D
90%
-€900,000
-€810,000
For the exam, Risk D (because of the high probability) calculates as the greatest average loss when using EMV. In the real world, other factors may also be relevant. 11-40
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EMV: Other Examples (Reference Manual pp. 11-13 to 11-15, PMBOK® Guide pp. 336-341)
• What is the EMV of a $500,000 gain if the probability is 80%? • 500,000 x .80 = $400,000
• What is the overall EMV for a project if it has a 60% chance of returning a $200,000 profit and a 40% chance of suffering a $50,000 loss? Outcome
Probability
EMV
$200,000
60%
$120,000
-$50,000
40%
-$20,000
Overall EMV
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$100,000
© 2015 CMF Solutions and TwentyEighty Strategy Execution, All Rights Reserved
Unit 11
Decision Tree: Example Scenario (Reference Manual pp. 11-13 to 11-15, PMBOK® Guide pp. 336-341)
• You must decide whether to introduce a new snow blower into stores in January or wait until February • The new product has design flaws that, if not fixed, may lead to a high rate of returns with associated financial losses • Decision: • Release in January and take your chances You must estimate sales and losses from repairs • Fix the design, release in February, and suffer some lost sales Again, you must estimate sales and losses from repairs
11-42
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Unit 11
Basic Structure of a Decision Tree (Reference Manual pp. 11-13 to 11-15, PMBOK® Guide pp. 336-341)
11-43
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Decision Tree Example: Add EMV Data (Reference Manual pp. 11-13 to 11-15, PMBOK® Guide pp. 336-341)
11-44
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Unit 11
Decision Trees: Key Points (Reference Manual pp. 11-13 to 11-15, PMBOK® Guide pp. 336-341)
11-45
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Unit 11
Monte Carlo Simulation: Effect of Path Convergence (Reference Manual pp. 11-13 to 11-15, PMBOK® Guide pp. 336-341)
11-46
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Unit 11
Tools for Perform Quantitative Risk Analysis (Reference Manual pp. 11-13 to 11-15, PMBOK® Guide pp. 336-341)
• Expert judgment: Subject matter experts used to provide data and validate quantification results
11-47
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Unit 11
Outputs from Perform Quantitative Risk Analysis (Reference Manual p. 11-15, PMBOK® Guide p. 341)
• Project documents updates: Updating the risk register • Probabilistic analysis of the project: Forecast of cost and schedule outcomes with confidence levels (probability data) • Probability of achieving cost and schedule objectives: A quantitative analysis of the likelihood of meeting specified goals • Prioritized list of quantified risks: Risks that pose the greatest threats or offer the greatest opportunities • Trends in quantitative risk analysis results: Documenting trends, if any, in the risk analysis
11-48
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Unit 11
Plan Risk Responses: Introduction (Reference Manual p. 11-15, PMBOK® Guide p. 342)
• Is part of the planning process group • Deciding how to enhance opportunities and reduce threats • Owners for each risk response should be assigned: • Take responsibility for each assigned response
• Risk responses should be: • Appropriate for the severity of the risk • Cost effective and timely • Agreed upon and realistic • Owned by a specific person
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Unit 11
Plan Risk Responses (Reference Manual p. 11-16, PMBOK® Guide p. 342)
Inputs
Tools
Outputs
Risk management plan
Strategies for negative risks or threats
Project management plan updates
Risk register
Strategies for positive risks or opportunities
Project documents updates
Contingent response strategies Expert judgment
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Unit 11
Inputs to Plan Risk Responses (Reference Manual pp. 11-16, PMBOK® Guide p. 343)
• Risk management plan: • Assigns risk owners • Defines thresholds for low, moderate, and high risks • Establishes the time and budget for conducting response activities
• Risk register: Contains the results of previous processes • Identified risks, priority, and risk triggers • Root causes and risk categories • List of potential responses • Risks requiring near-term response • Watch list of low risks 11-51
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Tools for Plan Risk Responses (Reference Manual pp. 11-16 to 11-18, PMBOK® Guide pp. 343-346)
• Strategies for negative risks or threats: • Avoid: Attempts to eliminate the threat Reduce scope or change project objectives Extend the schedule or adopt a safer, proven approach
• Transfer: Bringing another party into play (also called “deflect”) Insurance and/or warranty Outsource the work and use a fixed price contract
• Mitigate: Actions to reduce the probability or impact of a risk Use a less complex approach or conduct more tests Employ redundancy and back-up systems, choose proven suppliers
• Accept: The only technique that applies to both negative risks and positive opportunities Used for a low risk: Take no action, handle the risk later if it actually occurs 11-52
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Tools for Plan Risk Responses (Reference Manual pp. 11-16 to 11-18, PMBOK® Guide pp. 343-346)
• Strategies for positive risks or opportunities: • Exploit: Apply maximum possible support Assign the best resources, use the best technologies Sponsor exerts maximum influence, provide better cost and schedules
• Share: Joint ventures, alliances, and other collaboration Share costs and risks Build on synergy of each partner doing what they excel at
• Enhance: Increasing the probability or impact of an opportunity Maximize natural advantages: superior technology or distribution channels Add resources to finish earlier
• Accept: Minimal support of inferior opportunities Do not divert your best resources away from more promising opportunities
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Unit 11
Tools for Plan Risk Responses (Reference Manual pp. 11-16 to 11-18, PMBOK® Guide pp. 343-346)
• Contingent response strategy: Response plans only used when specific events occur first • Example: A response plan is triggered only if a given milestone was missed
• Expert judgment: Subject matter experts assisting with response planning
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Outputs from Plan Risk Responses (Reference Manual pp. 11-18 & 19, PMBOK® Guide pp. 346-348)
• Project management plan updates: Typical changes may include • Schedule and cost management plans • Quality, HR, and procurement management plans • Baselines: Scope, schedule, cost
• Project documents updates: Updates to the risk register • Assignment of risk owners and agreed response strategies • Budget and schedule needed to implement response plans • Risk triggers and contingency reserves • Contingency and fallback plans • Residual and secondary risks • Other: Assumptions log, technical documents, change requests 11-55
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Unit 11
Control Risks: Introduction (Reference Manual p. 11-19, PMBOK® Guide p. 349)
• Is part of the monitoring and controlling process group • Involves: • Identifying new risks • Ensuring that response plans are implemented • Evaluating the effectiveness of response plans • Monitoring residual risks (risks not covered by formal planning)
• Other control activities: • Determine whether assumptions are still valid • Decide whether to change or retire a risk • Decide whether to modify cost or schedule reserves 11-56
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Unit 11
Control Risks (Reference Manual p. 11-20, PMBOK® Guide p. 349)
Inputs
Tools
Outputs
Project management plan
Risk reassessment
Work performance information
Risk register
Risk audits
Change requests
Work performance data
Variance and trend analysis
Project management plan updates
Work performance reports
Technical performance measurement
Project documents updates
Reserve analysis
OPA updates
Meetings
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Inputs to Control Risks (Reference Manual pp. 11-20, PMBOK® Guide pp. 350-351)
• Project management plan: Contains the risk management plan • Assigns risk owners and the resources to carry out risk monitoring
• Risk register: Information from previous processes • Identified risks, risk owners, risk triggers • Residual and secondary risks, watch list, and planned reserves
• Work performance data: The status of the work indicates whether certain risks are occurring (deliverables, schedules, costs)
• Work performance reports: Analyzing work performance data to create status reports and forecasts
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Unit 11
Tools for Control Risks (Reference Manual p. 11-21, PMBOK® Guide pp. 351-352)
• Risk reassessment: Identifies new risks, tracks current risks, and closes risks that are outdated • For new risks: A response plan must be devised • For previously identified risks that actually occur: Evaluate the effectiveness of the response plan (lessons learned) • For previously identified risks that do not occur: Record the data for future use (quality of risk data)
• Risk audits: Evaluates and documents the effectiveness of risk responses and risk processes • May be part of regular status meetings or separate events
• Variance and trend analysis: Used to monitor overall performance and whether any deviations are caused by risks
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Unit 11
Tools for Control Risks (Reference Manual p. 11-21, PMBOK® Guide pp. 351-352)
• Technical performance measurement: Using the results of testing and prototyping to determine whether technical outcomes are on track
• Reserve analysis: Evaluates whether remaining reserves are adequate to cover remaining risks
• Meetings: Risk management should be on the agenda for regular team meetings
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Outputs from Control Risks (Reference Manual pp. 11-21 & 22, PMBOK® Guide pp. 353-354)
• Work performance information: Summarizes performance data and provides a mechanism for on-going decision making
• Change requests: Implementing contingency plans sometimes leads to project changes (money, schedules, resources, etc.) • Changes may lead to corrective or preventive actions • Corrective actions may include: Contingency plans: Devised up-front when a high risk is first identified Workarounds: A risk response devised after the risk has already occurred (used when a low risk was previously accepted)
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Outputs from Control Risks (Reference Manual pp. 11-21 & 22, PMBOK® Guide pp. 353-354)
• Project management plan updates: May update risk information in the project plan
• Project documents updates: Updating the risk register • Risk reassessment and risk audit activities • Recording the occurrence of risk events and effectiveness of responses
• OPA updates: • Templates for the risk plan and risk register • New lessons learned from risk management activities
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Other Topics (Reference Manual pp. 11-22 & 23, PMBOK® Guide No Reference)
• Other Topics covers information known to be on the real exam but not addressed by the PMBOK® Guide: • Probability theory • Risk versus estimating range
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Probability Theory (Reference Manual pp. 11-22 & 23, PMBOK® Guide No Reference)
• The questions on probability have always been relatively simple • The questions have also assumed that the events in question are statistically independent and mutually exclusive: • In other words, each event is an independent trial and is not affected by what happened on another event
• Probability of heads on a coin toss = 50% • Probability of heads on any subsequent trial also = 50% • Probability of heads twice in a row = 50% x 50% = 25% • If the probability of Event A is 30%, the probability of A not happening is 70%, i.e. 1-P(A) 11-64
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Probability Theory (continued) (Reference Manual pp. 11-22 & 23, PMBOK® Guide No Reference)
• If the probability of Event B is 20% during any given month, what is the probability that Event B will not occur in the third month? • 80%: Each month is an independent trial and the probability of this event not occurring = 80% = 1-20%
• From the previous question, what is the probability that Event B will not occur two months in a row? • Probability of the event not occurring = 80% • Not occurring two months in a row = 80% x 80% = 64%
• If the P(A) is 50% and the P(B) is 60%, what is the probability that A and B both occur? Multiply the probabilities: 50% x 60% = 30%
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Risk vs. Estimating Range (Reference Manual pp. 11-22 & 23, PMBOK® Guide No Reference)
• Recall that if your cost or duration estimate has a wider range, you are communicating that the work is more uncertain • Which of the following three cost estimates shows work with the highest risk or uncertainty? a. $100,000 plus or minus $10,000 b. $95,000 to $110,000 c. $88,000 to $105,000
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Drill Practice Reminder
Drill practice for this chapter starts on p. 11-25
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Unit 12
PROCUREMENT MANAGEMENT
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Unit 12
Procurement Management Concept (Reference Manual p. 12-1, PMBOK® Guide p. 355)
• Procurement management includes the processes for purchasing or acquiring products and services from outside the organization • Under U.S. contract law, contracts are: • Legally binding (if they meet four conditions-will be covered later) • Subject to remedy in the courts
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Procurement Management: Key Points (Reference Manual p. 12-1, PMBOK® Guide pp. 357-358)
• A contract may also be called an agreement, an understanding, a subcontract, or a purchase order • Because they are legally binding, contracts are usually subject to a more extensive review process than other documents • Complex projects usually involve managing multiple contracts • The seller may be called a contractor, subcontractor, vendor, service provider, or supplier • The buyer may be called a client, customer, acquiring organization, service requestor, or purchaser • A buyer may also be called a prime contractor or contractor when the contractor is, in turn, outsourcing part of their work 12-3
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Overview of Topics in Unit 12 • Procurement Management Processes • Other Topics • Information that has been tested but is not covered by the PMBOK® Guide.
• Drill Practice
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Unit 12
Overview of Procurement Management Processes (Reference Manual p. 12-1, PMBOK® Guide p. 355)
12.1 Plan Procurement Management (documenting what to purchase, specifying the approach, and identifying potential sellers)
12.2 Conduct Procurements (obtaining seller responses, selecting sellers, and awarding contracts)
12.3 Control Procurements (managing procurement relationships, monitoring contract performance, and making changes as needed)
12.4 Close Procurements (completing project procurements)
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Selected Knowledge Area, Process Groups, and Processes (Reference Manual p. 3-7, PMBOK® Guide pp. 60-61)
Process Groups Knowledge Areas
Initiating
Planning
Executing
Controlling
• Plan procurement management
• Conduct procurements
• Control procurements
Closing
Integration Scope Time Cost Quality HR Communication Risk Procurement
• Close procurements
Stakeholder
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Plan Procurement Management: Introduction (Reference Manual p. 12-1, PMBOK® Guide pp. 358-360)
• Is part of the planning process group • Involves deciding which products or services should be procured from outside the organization • This process also involves: • Specifying the procurement approach to be used • Identifying potential sellers
• Specific questions that must be answered: • Whether to procure a product or service from outside • What, how, when, and how much to procure
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Plan Procurement Management: Key Points (Reference Manual p. 12-1, PMBOK® Guide pp. 358-360)
• Procurement planning must consider the following: • Potential sellers (Is a buy decision feasible?) • The desired schedule (Best met through “make” in-house or “buy” from the outside) • Risks (Best managed in-house or through “buy” from the outside) • The appropriate type of contract for the work • The exam has focused primarily on two types of contracts: Fixed price Cost reimbursable
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Unit 12
Plan Procurement Management (Reference Manual p. 12-2, PMBOK® Guide p. 358)
Inputs
Tools
Outputs
Project management plan
Make-or-buy analysis Procurement management plan
Requirements documentation
Expert judgment
Procurement statement of work
Risk register
Market research
Procurement documents
Activity resource requirements
Meetings
Source selection criteria
Project schedule
Make-or-buy decisions
Activity cost estimates
Change requests
Stakeholder register
Project documents updates
EEF OPA Note: EEF = Enterprise Environmental Factors OPA = Organizational Process Assets 12-9
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Inputs to Plan Procurement Management (Reference Manual pp. 12-2 to 12-5, PMBOK® Guide pp. 360-364)
• Project management plan: Describes project need and contains the scope baseline • Scope statement: Requirements, deliverables, constraints, assumptions, and acceptance criteria Constraints include: delivery dates and available skilled resources
• WBS: Describes and organizes the work • WBS dictionary: Details for control accounts and work packages
• Requirements documentation: Identifies project requirements • Some requirements have contractual and legal implications: Health, safety, environmental, licenses, and permits • These legal issues may dictate that outsourcing is necessary
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Inputs to Plan Procurement Management (Reference Manual pp. 12-2 to 12-5, PMBOK® Guide pp. 360-364)
• Risk register: Outsourcing via a contract is sometimes chosen as a risk mitigation strategy
• Activity resource requirements: Work may be outsourced using a contract if equipment and human resources are not available in-house
• Project schedule: Outsourcing if in-house capabilities cannot meet the required timeline
• Activity cost estimates: Outsourcing if in-house costs are too high • Stakeholder register: Lists key stakeholders and their level of interest in the project
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Inputs to Plan Procurement Management (Reference Manual pp. 12-2 to 12-5, PMBOK® Guide pp. 360-364)
• EEF: • Conditions of the marketplace: Is the product or service available in the marketplace? Is a reputable contractor available at the right time?
• Typical terms and conditions for the specific work needed • Unique local requirements that may exist geographically
• OPA: • Procurement policies: Will certain work be “set aside” for small and disadvantaged business? • Procedures for selecting contract type: You must know the differences between fixed price and cost reimbursable contracts 12-12
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Contract Types: Three Major Categories (Reference Manual pp. 12-2 to 12-5, PMBOK® Guide pp. 360-364)
• Fixed price: Used for well defined product and risk is low • Seller bears most of the risk • Seller legally obligated to deliver finished product even if they lose money
• Cost reimbursement: Used when scope of work cannot be adequately defined and risk is high • Buyer bears most of the risk • Seller not required to deliver finished product (must deliver “best effort”)
• Time and material: Hybrid mix of fixed price and cost reimbursement • Seller paid a preset amount per unit, e.g., $200 per hour for engineering services • Quantity to be delivered is left open ended (how many hours used) 12-13
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Types of Contracts: Key Issues (Reference Manual pp. 12-2 to 12-5, PMBOK® Guide pp. 360-364)
• Risk and type of contract • Factors in selecting appropriate type of contract • Cost reimbursement types: • Cost Plus Percentage of Cost (CPPC) • Cost Plus Fixed Fee (CPFF) • Cost Plus Incentive Fee (CPIF) • Cost Plus Award Fee (CPAF)
• Fixed price types: • Fixed Price Incentive Fee (FPIF) • Firm Fixed Price (FFP) • Fixed Price with Economic Price Adjustment (FP-EPA) 12-14
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Risk and Type of Contract (Reference Manual pp. 12-2 to 12-5, PMBOK® Guide pp. 360-364)
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Factors in Selecting Type of Contract (Reference Manual pp. 12-2 to 12-5, PMBOK® Guide pp. 360-364)
Factor
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Fixed Price
Cost Reimbursement
Ability to define scope
Scope is well defined
Scope vague, hard to define
Risk
Risk is low
Risk is high
Ability to estimate costs accurately
Cost estimates are accurate
Cost estimates are difficult
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CPPC Pricing: Cost Plus Percentage of Cost (Reference Manual pp. 12-2 to 12-5, PMBOK® Guide pp. 360-364)
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CPFF Pricing: Cost Plus Fixed Fee (Reference Manual pp. 12-2 to 12-5, PMBOK® Guide pp. 360-364)
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CPIF Pricing: Cost Plus Incentive Fee (Reference Manual pp. 12-2 to 12-5, PMBOK® Guide pp. 360-364)
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CPIF Pricing: Calculation of Fee and Price (Reference Manual pp. 12-2 to 12-5, PMBOK® Guide pp. 360-364)
Given:
Solution:
Target cost = $100,000
Step 1. Calculate Fee Adjustment:
Target fee = $20,000
(Target cost – Actual cost) x SSR
Share ratio = 50:50
(100k-90k) x .50
Problem to solve: If actual costs are $90,000 What fee will seller earn? What price does buyer pay?
+10k x .5 = +5k Step 2. Calculate Fee: Target fee + Adjustment 20k + 5k = 25k Step 3. Calculate Buyer Price: Actual Cost + Actual Fee 90k + 25k = 115k Conclusion: Saved $10,000 Seller got half added to fee Buyer got half subtracted from price
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FPIF Pricing: Fixed Price Incentive Fee (Reference Manual pp. 12-2 to 12-5, PMBOK® Guide pp. 360-364)
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FPIF: Pricing Exercise (PTA, Fee, Price) (Reference Manual pp. 12-2 to 12-5, PMBOK® Guide pp. 360-364)
Given:
Solution (PTA):
Target cost = $100,000
PTA Formula:
Target fee = $20,000 Share ratio = 75:25 (“BS”) Ceiling price = $150,000
Ceiling Price-Target Price Buyer Share
Problem to solve:
Calculate PTA:
If actual costs are $120,000
(150,000-120,000) + 100,000 .75
• What is the PTA? • What fee will seller earn?
=
40,000
+ Target Cost
+ 100,000 = $140,000
• What price does buyer pay?
Next Slide Shows Fee and Price Calculations!
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Unit 12
FPIF Pricing: Calculation of Fee and Price (Reference Manual pp. 12-2 to 12-5, PMBOK® Guide pp. 360-364)
Given:
Solution:
Target cost = $100,000
Step 1. Calculate Fee Adjustment:
Target fee = $20,000
(Target cost - Actual cost) x SSR
Share ratio = 75:25 (“BS”)
(100k-120k) x .25
Problem to solve: If actual costs are $120,000 • What fee will seller earn? • What price does buyer pay?
-20k x .25 = -5k Step 2. Calculate Fee: Target fee + Adjustment 20k - 5k = 15k Step 3. Calculate Buyer Price: Actual Cost + Actual Fee 120k + 15k = 135k Conclusion: Over by $20,000: • Seller got 25% ($5k) subtracted from fee • Buyer got 75% ($15k) added to price
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CPIF vs. FPIF: Similarities and Differences (Reference Manual pp. 12-2 to 12-5, PMBOK® Guide pp. 360-364)
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FFP Pricing: Firm Fixed Price (Reference Manual pp. 12-2 to 12-5, PMBOK® Guide pp. 360-364)
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Risk and Type of Contract: Summary (Reference Manual pp. 12-2 to 12-5, PMBOK® Guide pp. 360-364)
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Special Contract Types (Reference Manual pp. 12-2 to 12-5, PMBOK® Guide pp. 360-364)
• PMI identifies two special types of contracts: • Fixed Price with Economic Price Adjustment (FP-EPA) • Cost Plus Award Fee (CPAF)
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Fixed Price with Economic Price Adjustment (Reference Manual pp. 12-2 to 12-5, PMBOK® Guide pp. 360-364)
• Long-term performance period (usually several years) • Protects the seller from rising costs: • Inflation rate changes • Changes in cost of materials, fuel, etc.
• Provides for adjustments to the final contract price • Adjustments usually based on a designated financial index
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Cost Plus Award Fee (Reference Manual pp. 12-2 to 12-5, PMBOK® Guide pp. 360-364)
• Subjective performance criteria established at the outset • An award fee pool in a specified monetary amount is established • Buyer decides how much of the fee the seller has earned • Gives the buyer significant leverage • Award fee pools can be combined with virtually any type of contract
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Purpose and Effectiveness of Incentives (Reference Manual pp. 12-2 to 12-5, PMBOK® Guide pp. 360-364)
• Types of incentive contracts in the PMBOK® Guide: • CPIF, CPAF, FPIF
• Purpose of incentives: Align the objectives of both parties, i.e. find a zone that is “win-win” • If the contractor can perform below the target cost, the fee is adjusted upward and the price is adjusted downward
• Effectiveness of incentives: • Real world evidence shows that incentives really work, they are not just a theory! • An entire interstate highway exchange was rebuilt in one weekend; the motivation was a significant award fee (pot of money)
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Tools for Plan Procurement Management (Reference Manual p. 12-6, PMBOK® Guide pp. 365-366)
• Make-or-buy analysis: Examines the cost effectiveness of producing inhouse (make) or procuring from the outside (buy) • The analysis should consider both direct and indirect costs • Indirect costs are the costs of managing the contractor
• Expert judgment: Expertise to develop evaluation criteria and to judge the proposals received • Special expertise required: Purchasing, legal, and technical
• Market research: Examines capability of potential contractors to actually complete the work successfully
• Meetings: Meetings with potential bidders, e.g., bidder conferences
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Outputs from Plan Procurement Management (Reference Manual pp. 12-6 to 12-8, PMBOK® Guide pp. 366-370)
• Procurement management plan: A component of the project plan, describes how procurement processes will be managed • Types of contracts • Whether independent estimates will be used • Managing multiple suppliers • Coordinating procurement with resource needs, schedules, costs • Formats for the statement of work and maintenance of the WBS • Constraints, assumptions, and lead times • Managing risks • Identifying pre-qualified sellers • Metrics for performance reporting
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Outputs from Plan Procurement Management (Reference Manual pp. 12-6 to 12-8, PMBOK® Guide pp. 366-370)
• Procurement statement of work (SOW): A narrative description of goods or services to be supplied under contract • The SOW may also identify other services such as performance reporting, project reviews, and post-project support • May also be called a: Statement of requirements (SOR) Statement of objectives (SOO)
• Procurement documents: Used to request proposals from prospective sellers • A procurement may be initiated as a unilateral contract (a purchase order for standard items at established prices) • Alternatively, a bilateral contract may be initiated in one of several ways
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Outputs from Plan Procurement Management (Reference Manual pp. 12-6 to 12-8, PMBOK® Guide pp. 366-370)
• Procurement documents (continued): • Request for Information (RFI): Asks for “expressions of interest”, provides a forum to clarify requirements, and may help establish a qualified sellers list • Invitation for Bid (IFB, aka Sealed Bid): Used for routine, well-defined items Objective: Best price (usually low bid); no negotiating or discussion
• Request for Quotation (RFQ): Also used for routine, well-defined items Objective: Best value; considers other factors (schedule, quality, etc.) Negotiating and discussion are allowed
• Request for Proposal (RFP): Used for complex, non-standard items of relatively high monetary value Objective: Must develop a new item; Negotiating and discussion are usually necessary 12-34
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Outputs from Plan Procurement Management (Reference Manual pp. 12-6 to 12-8, PMBOK® Guide pp. 366-370)
• Source selection criteria: Used to rate or score proposals • The criteria may be objective: The project manager must have a PMP • The criteria may be subjective: The PM must have relevant experience • Example criteria: Price, overall life cycle cost Understanding of need Technical capability Past performance Financial and production capacity Intellectual property and proprietary rights Warranty and risk Management approach
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Outputs from Plan Procurement Management (Reference Manual pp. 12-6 to 12-8, PMBOK® Guide pp. 366-370)
• Make-or-buy decisions: Buy decisions drive the process to find an outside supplier
• Change requests: When change requests arise during procurement, they must be processed using the Perform Integrated Change Control process
• Project documents updates: • Requirements documentation • Requirements traceability matrix • Risk register
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Unit 12
Conduct Procurements: Introduction (Reference Manual p. 12-8, PMBOK® Guide p. 371)
• Is part of the executing process group • Includes the processes for: • Obtaining seller responses • Selecting a seller • Awarding a contract
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Unit 12
Conduct Procurements (Reference Manual p. 12-9, PMBOK® Guide p. 371)
Inputs
Tools
Outputs
Procurement Management plan Bidder conferences
Selected sellers
Procurement documents
Proposal evaluation techniques
Agreements
Source selection criteria
Independent estimates
Resource calendars
Seller proposals
Expert judgment
Change requests
Project documents
Advertising
Project management plan updates
Make-or-buy decisions
Analytical techniques
Project documents updates
Procurement statement of work
Procurement negotiations
OPA
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Conduct Procurements: Key Points (Reference Manual p. 12-8, PMBOK® Guide p. 371)
• During this process, qualified seller lists are often created to: • Speed up the process • Reduce the chance of awarding to a poorly qualified seller
• Bidder conferences are also used to clarify requirements and improve the quality of proposals • Common practice: Screen initial responses to create a list of sellers who are in the “competitive range” • Weighting and screening systems establish a preferred sequence of the best offers
• Some organizations use a practice known as BAFO (best and final offer) • Used as a way to suggest that prospective sellers lower their prices 12-39
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Inputs to Conduct Procurements (Reference Manual pp. 12-9 & 10, PMBOK® Guide pp. 373-375)
• Procurement management plan: An output of the previous process, describes how procurement processes will be managed
• Procurement documents: Chooses the appropriate document to request seller responses (IFB, RFQ, RFP)
• Source selection criteria: Used to evaluate and compare bids or proposals
• Seller proposals: Submitted by potential sellers in response to buyer’s procurement document package (PDP) • A proposal is a legal offer, if accepted it’s the basis for a contract • PDP contains: a) Procurement document (IFB, RFQ, or RFP), b) List of evaluation criteria, and c) Instructions (Due date, table of contents, required formatting, etc.) 12-40
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Inputs to Conduct Procurements (Reference Manual pp. 12-9 & 10, PMBOK® Guide pp. 373-375)
• Project documents: The risk register and decisions to outsource because of risk
• Make-or-buy decisions: Factors influencing these decisions— • Core capability (technical capability to perform the work in-house) • Value added by a vendor • Risk comparison: make vs. buy
• Procurement statement of work (SOW): Describes goals and requirements that must be met, SOW may include— • Specifications, quantity, quality, and performance data • Period of performance, work location, other information as appropriate
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Inputs to Conduct Procurements (Reference Manual pp. 12-9 & 10, PMBOK® Guide pp. 373-375)
• OPA: • Listings of qualified sellers • Past experience with specific sellers • Prior contractual agreements (historical files)
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Tools for Conduct Procurements (Reference Manual pp. 12-11 & 12, PMBOK® Guide pp. 375-377)
• Bidder conferences: Used to ensure all bidders share a clear understanding of requirements • All potential sellers must be given equal access to information
• Proposal evaluation techniques: Established source selection procedures • Establishes the approach for evaluating and selecting winning proposals • May establish a screening system: A minimum criteria that must be met • For example, your proposal is discarded without further review if your PM does not have a PMP
• Independent estimates: In-house verification that bids are fair and reasonable, important if not using competitive procurement
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Tools for Conduct Procurements (Reference Manual pp. 12-11 & 12, PMBOK® Guide pp. 375-377)
• Expert judgment: Financial, technical, and managerial expertise needed to evaluate proposals
• Advertising: Additional advertising to increase the extent of competition • Analytical techniques: Evaluating past performance information to ensure prospective sellers will be capable of meeting project requirements
• Procurement negotiations: Reaching mutual agreement on contract requirements prior to signing • Objectives of negotiation: Obtain a fair and reasonable price Develop and preserve a good working relationship for both parties (by achieving a win-win solution)
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Tools for Conduct Procurements (Reference Manual pp. 12-11 & 12, PMBOK® Guide pp. 375-377)
• Procurement negotiations (continued): • Common negotiating tactics: Deadline: We have to catch a flight and must go home with a signed deal Good cop/bad cop: One person is friendly and helpful, the other is demanding and difficult Fait accompli: Pretending that a condition is either a “done deal” or is not negotiable Missing man: “Only my boss can agree to that, how about this instead” Limited authority: “I’m only authorized to offer up to $50,000” Delay: “We’re running out of time, let’s handle that later” (like smoothing in the conflict model) Personal insults: Trying to intimidate or undermine someone’s confidence Fair and reasonable: An appeal to your good nature to be fair 12-45
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Unit 12
Outputs from Conduct Procurements (Reference Manual pp. 12-12 to 12-14, PMBOK® Guide pp. 377-379)
• Selected sellers: A seller who has submitted a proposal that has been accepted • The proposal becomes the basis for the contract, subject to any final negotiating of terms and conditions
• Agreements: The contract establishes a legal relationship subject to remedy in the courts • Is mutually binding: Obligates the seller to provide the specified product and the buyer to pay for it • Elements of a legally enforceable contract: Agreement must be voluntary: An offer and an acceptance Agents must be legally authorized to enter into an agreement (the authorization can be written or verbal) There must be sufficient cause or consideration (an exchange of value) The contract must be for work that is legal 12-46
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Outputs from Conduct Procurements (Reference Manual pp. 12-12 to 12-14, PMBOK® Guide pp. 377-379)
• Resource calendars: Documenting the quantity needed and availability of contracted resources
• Change requests: Any change requests during the procurement must be handled using the Perform Integrated Change Control process
• Project management plan updates: • Cost, schedule, and scope baselines • Communication and procurement management plans
• Project documents updates: • Requirements documentation and traceability information • Risk and stakeholder registers
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Control Procurements: Introduction (Reference Manual p. 12-14, PMBOK® Guide p. 379)
• Is part of the monitoring and controlling process group • Both parties ensure the other meets its contractual obligations • Involves: • Monitoring performance • Managing interfaces among multiple providers • Handling changes and making corrections • Processing interim or progress payments • May involve managing early termination of a contract: By mutual agreement For default For convenience of the buyer 12-48
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Unit 12
Control Procurements (Reference Manual p. 12-14, PMBOK® Guide p. 379)
Inputs
Tools
Outputs
Project management plan
Contract change control system Work performance information
Procurement documents
Procurement performance reviews
Change requests
Agreements
Inspections and audits
Project management plan updates
Approved change requests
Performance reporting
Project documents updates
Work performance reports
Payment systems
OPA updates
Work performance data
Claims administration Records management system
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Inputs to Control Procurements (Reference Manual p. 12-15, PMBOK® Guide pp. 381-382)
• Project management plan: Contains the procurement management plan which describes how procurement processes will be handled
• Procurement documents: The contract and the SOW are two of the most important guiding documents
• Agreements: The contract or other agreement (understanding, subcontract, purchase order)
• Approved change requests: Provides information on modifications to contract terms, especially any effect on the triple constraint • Verbally discussed but undocumented change requests should not be implemented
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Inputs to Control Procurements (Reference Manual p. 12-15, PMBOK® Guide pp. 381-382)
• Work performance reports: Documentation on seller performance • Technical progress • Cost, schedule, and resource performance • Forecasts
• Work performance data: Actual outcomes • Costs incurred • Deliverables completed • Interim or progress payments processed • Are quality standards being met?
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Tools for Control Procurements (Reference Manual pp. 12-15 & 16, PMBOK® Guide pp. 383-384)
• Contract change control system: Establishes procedures by which changes can be approved • Includes paperwork, tracking, and approval levels • Also includes dispute resolution procedures
• Procurement performance reviews: Structured review of seller’s progress • Cost, schedule, scope, quality • Purpose: Document whether seller is able to complete the work as planned
• Inspections and audits: Techniques used to check seller compliance with contract requirements
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Tools for Control Procurements (Reference Manual pp. 12-15 & 16, PMBOK® Guide pp. 383-384)
• Performance reporting: Documents seller’s effectiveness in meeting contract objectives
• Payment systems: Handling of progress payments if appropriate • Claims administration: Contested or “constructive” changes may lead to a dispute about whether a change was authorized • If the parties cannot agree, dispute resolution procedures come into play • See p. 12-20 in the reference manual for a definition of constructive change
• Records management system: Management of contract documents • Usually involves a disciplined index system for archiving and retrieval 12-53
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Outputs from Control Procurements (Reference Manual pp. 12-16 & 17, PMBOK® Guide pp. 384-386)
• Work performance information: Provides information to check seller performance and compliance with the contract
• Change requests: Processed using integrated change control, disputed changes receive special attention
• Project management plan updates: • Procurement management plan • Cost or schedule baselines
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Outputs from Control Procurements (Reference Manual pp. 12-16 & 17, PMBOK® Guide pp. 384-386)
• Project documents updates: • The contract and supporting schedules • Status of change requests still under review • Approved change requests • Status of deliverables, especially technical progress • Invoices and payment records • Contractually required inspections
• OPA updates: A big procurement record keeping exercise • All important correspondence: Decisions, inspections, audits, changes • Handling of payments • Seller performance evaluation 12-55
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Close Procurements: Introduction (Reference Manual p. 12-17, PMBOK® Guide p. 386)
• Is part of the closing process group • Supports the Close Project or Phase process, Integration Unit • Involves: • Product verification: Was the work completed correctly? • Administrative closeout: Updating and archiving of records
• Early termination is a possibility: • Mutual agreement • Default • Convenience of the buyer
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Unit 12
Close Procurements (Reference Manual p. 12-17, PMBOK® Guide p. 386)
Inputs
Tools
Outputs
Project management plan
Procurement audits
Closed procurements
Procurement documents
Procurement negotiations
OPA updates
Records management system
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Inputs to Close Procurements (Reference Manual p. 12-18, PMBOK® Guide p. 388)
• Project management plan: Contains the procurement management plan which provides guidelines for closing each procurement
• Procurement documents: Collecting, indexing, and filing all documentation • The information is used for: Estimating future contracts Evaluating contractors on future procurements Lessons learned
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Tools for Close Procurements (Reference Manual p. 12-18, PMBOK® Guide pp. 388-389)
• Procurement audits: Structured reviews to identify successes and failures • Procurement audits are also known as lessons learned • The information is used to improve current and future projects
• Procurement negotiations: Final settlement of issues, claims, and disputes • Negotiation is preferred but alternate dispute resolution methods may be called on if needed
• Records management system: Provides a consistent, structured method for archiving contract records
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Outputs from Close Procurements (Reference Manual p. 12-18, PMBOK® Guide p. 389)
• Closed procurements: Buyer provides formal, written notice that the contract is complete
• OPA updates: • Procurement file: An official, complete set of indexed contract documentation • Deliverable acceptance: Formal, written notice that deliverables have been accepted or rejected • Lessons learned documentation: Post-project evaluation provides historical records Creates a past performance database to assist in selecting contractors on future work Organizes all project lessons learned in the OPA knowledge base
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Other Topics (Reference Manual pp. 12-19 to 12-22, PMBOK® Guide No Reference)
• Other Topics covers information known to be on the real exam but not addressed by the PMBOK® Guide: • Non-competitive procurements • Single vs. sole source • Organizing procurement: Centralized or decentralized • Privity of contract • Constructive change • Other contract definitions • Summary of closing processes 12-61
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Three Conditions for Non-Competitive Procurement (Reference Manual pp. 12-19 to 12-22, PMBOK® Guide No Reference)
• PMI identifies three conditions in which non-competitive procurement makes sense: • When a specific contractor has genuinely unique capabilities • When you have methods (such as independent estimating) to ensure proposed prices are fair and reasonable • When schedule pressure exists: Competitive procurements use procedures that are time consuming Competitive procurements do not allow a quick response to a need
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Single vs. Sole Source (Reference Manual pp. 12-19 to 12-22, PMBOK® Guide No Reference)
• Single source: Using a preferred supplier but other sources do exist • Sole source: Only one known supplier is available • Could be a patent limitation • Could be that only one supplier has the technical capability
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Centralized or Decentralized Procurement (Reference Manual pp. 12-19 to 12-22, PMBOK® Guide No Reference)
• Centralized: Procurement specialists all sit together • Essentially a functional stovepipe organizational structure • More economical • Supports specialization of the procurement function • Less responsive to individual project needs
• Decentralized: Procurement specialists sit colocated with the project team • Essentially a projectized organizational structure • Procurement more responsive to individual projects, PM has more control • Higher resource costs; need to staff each project on a full-time basis
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Privity of Contract (Reference Manual pp. 12-19 to 12-22, PMBOK® Guide No Reference)
• Privity of contract defines which parties have legally binding agreements • A buyer enters into a legally binding agreement with their contractor • However, the buyer has no legal agreement when their contractors do any further outsourcing with subcontractors: Example: The National Energy Technology Lab (NETL) enters into a contract with CGG Corporation CGG then outsources part of their work to the Synergetics Group NETL has no legal relationship with Synergetics In fact, it is improper for NETL to deal directly with Synergetics without the permission of CGG
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Constructive Change (Reference Manual pp. 12-19 to 12-22, PMBOK® Guide No Reference)
• Changes that originated because of: • Any statement, act, or inaction by an employee who is not legally authorized to make changes or sign contracts
• Such acts sometimes lead to changes which are questionable: • Was the change legally authorized or not? • Should the contractor have acted on the change? • Will the contractor be paid for the work that was done?
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Other Definitions (Reference Manual pp. 12-19 to 12-22, PMBOK® Guide No Reference)
• See the reference manual on pages 12-20 and 21 for other testable definitions: • Foreign currency exchange • Backcharge • Breach of contract • Force majeure • Liquidated damages • Standard contract clauses • Specification • Undefined work • Warranty • Warranty of Merchantibility • Waiver 12-67
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Summary of the Two Processes for Closing Work (Reference Manual pp. 12-19 to 12-22, PMBOK® Guide No Reference)
• See the reference manual on pages 12-21 and 22 for a concise summary of the closing processes: • Close Project or Phase • Close Procurements
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Drill Practice Reminder
Drill practice for this chapter starts on p. 12-23
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Unit 13
STAKEHOLDER MANAGEMENT
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Unit 13
Stakeholder Management Concept (Reference Manual p. 13-1, PMBOK® Guide p. 391)
• Stakeholder management identifies people, groups, and organizations that could impact or be impacted by the project • Some stakeholders are likely to impact the project in a positive way • Others are more likely to impact the project in a negative way • Some stakeholders have more power and influence than others • Managing these issues effectively may make a significant difference in project success
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Stakeholder Management: Key Points (Reference Manual p. 13-1, PMBOK® Guide p. 391)
• Key activities in effective stakeholder management: • Identify potential stakeholders • Assess interest, influence, and power of each stakeholder • Understand stakeholder needs and expectations • Develop appropriate management strategies • Manage issues and conflict • Continuously communicate with stakeholders
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Unit 13
Overview of Topics in Unit 13 • Reminder of previous stakeholder management guidelines from the PMBOK® Guide • Stakeholder Management Processes • Other Topics • Information that has been tested but is not covered by the PMBOK® Guide.
• Drill Practice
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Reminder of Stakeholder Management Guidelines (Reference Manual p. 2-9, PMBOK® Guide pp. 32-33)
• A stakeholder is anyone involved in the project, affected by the project, or who could influence the project: • Project manager and project team • Functional managers • Customers (approve and manage the product) and users (use the product) • Sponsor • PMO • Performing organization (enterprise with the people most directly involved in the work) • Sellers and business partners • Citizens and communities potentially affected by the project
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Stakeholder Reminders: Management Issues (Reference Manual p. 2-9, PMBOK® Guide pp. 32-33)
• Stakeholder requirements must be in the project plan • Stakeholder identification must occur early and be updated • Overlooking negative stakeholders can increase risk of failure • If stakeholder expectations come into conflict, the resolution should generally favor the customer • Sometimes the customer acts as the sponsor, there may not be a separate internal sponsor • Important stakeholders may be internal (inside your organization) or external (outside your organization) 13-6
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Overview of Stakeholder Management Processes (Reference Manual p. 13-1, PMBOK® Guide p. 391)
13.1 Identify Stakeholders (identifying the interests, involvement, and impact of people, groups, or organizations that could affect or be affected by the project)
13.2 Plan Stakeholder Management (developing appropriate management strategies for engaging stakeholders throughout the project)
13.3 Manage Stakeholder Engagement (communicating and working with stakeholders to meet needs and addressing issues as they occur)
13.4 Control Stakeholder Engagement (monitoring stakeholder relationships and adjusting strategies as needed)
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Selected Knowledge Area, Process Groups, and Processes (Reference Manual p. 3-7, PMBOK® Guide pp. 60-61)
Process Groups Knowledge Areas
Initiating
Planning
Executing
Controlling
Closing
Integration Scope Time Cost Quality HR Communication Risk Procurement Stakeholder
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Unit 13
Identify Stakeholders: Introduction (Reference Manual p. 13-1, PMBOK® Guide p. 393)
• Is part of the initiating process group • Identifies people, groups, and organizations that may impact or be impacted by the project • It is important to identify stakeholders early and: • Determine level of interest, influence, and power • Maximize positive influences and minimize negative impacts
• Project managers often deal with a large number of stakeholders • Therefore, it is important to prioritize the relative importance of all stakeholders
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Unit 13
Identify Stakeholders (Reference Manual p. 13-2, PMBOK® Guide p. 393)
Inputs
Tools
Project charter
Stakeholder analysis
Procurement documents
Expert judgment
EEF
Meetings
Outputs Stakeholder register
OPA
Note: EEF = Enterprise Environmental Factors OPA = Organizational Process Assets 13-10
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Inputs to Identify Stakeholders (Reference Manual p. 13-2, PMBOK® Guide pp. 394-395)
• Project charter: Provides information about stakeholders such as customers, sponsor, PM, team members, and other parties
• Procurement documents: When outsourcing, members of the seller organization are stakeholders
• EEF: • Organizational structure • Regulations or standards • Global, regional, or local trends
• OPA: • Templates for stakeholder registers and previous stakeholder registers • Lessons learned 13-11
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Tools for Identify Stakeholders (Reference Manual pp. 13-2 & 3, PMBOK® Guide pp. 395-397)
• Stakeholder analysis: Identifying the stakeholders who should be managed most carefully • Step 1: Identify potential stakeholders and document their roles, interests, and expectations • Step 2: Analyze potential impact and use a classification model Power vs. Interest Power vs. Influence Influence vs. Impact See next slide for an example
• Step 3: Assess likely responses (supporter or antagonist)
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Power vs. Interest Grid (Reference Manual pp. 13-2 & 3, PMBOK® Guide pp. 395-397)
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Tools for Identify Stakeholders (Reference Manual pp. 13-2 & 3, PMBOK® Guide pp. 395-397)
• Expert judgment: Used to identify and analyze stakeholders • Meetings: Profile analysis meetings are used to exchange information about stakeholders
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Outputs from Identify Stakeholders (Reference Manual p. 13-3, PMBOK® Guide p. 398)
• Stakeholder register: Contains all the information on identified stakeholders • Identification: Name, position, location, role, contact information • Assessment: Expectations and potential influence • Classification: Internal or external, supporter or antagonist
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Unit 13
Plan Stakeholder Management: Introduction (Reference Manual p. 13-3, PMBOK® Guide pp. 399)
• Is part of the planning process group • Involves developing strategies for effectively engaging key stakeholders throughout the project life cycle • Key activities: • Identify stakeholder expectations so they can be managed (makes gaining stakeholder buy-in easier) • Manage and improve communications • Create and maintain relationships between the project team and other stakeholders • Continuously review and adjust the levels of stakeholder engagement
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Unit 13
Plan Stakeholder Management (Reference Manual p. 13-4, PMBOK® Guide p. 399)
Inputs
Tools
Outputs
Project management plan
Expert judgment
Stakeholder management plan
Stakeholder register
Meetings
Project documents updates
EEF
Analytical techniques
OPA
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Inputs to Plan Stakeholder Management (Reference Manual p. 13-4, PMBOK® Guide pp. 400-401)
• Project management plan: • Project life cycle: Which processes apply to each project phase • How work will be executed to accomplish objectives • HR requirements: Roles, responsibilities, reporting, and managing staffing levels • Change management plan • Techniques for communicating among stakeholders
• Stakeholder register: Identifies important stakeholders
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Inputs to Plan Stakeholder Management (Reference Manual p. 13-4, PMBOK® Guide pp. 400-401)
• EEF: • All 13 factors are potentially relevant to managing stakeholders
• OPA: • Historical information and lessons learned are of special importance
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Tools for Plan Stakeholder Management (Reference Manual pp. 13-4 & 5, PMBOK® Guide pp. 401-403)
• Expert judgment: Helps determine the level of stakeholder engagement needed at each stage of the project • Example: Project sponsor is more important near the beginning of the project
• Meetings: Provide a forum to discuss stakeholder engagement • Analytical techniques: Comparing planned levels of engagement to actual levels of engagement • See the next slide for a classification scheme
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Stakeholder Engagement Matrix (Reference Manual p. 13-5, PMBOK® Guide pp. 402-403)
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Outputs from Plan Stakeholder Management (Reference Manual p. 13-5, PMBOK® Guide pp. 403-404)
• Stakeholder management plan: Identifies management strategies for effectively engaging stakeholders • Desired engagement levels • Stakeholder interrelationships and potential overlaps • Stakeholder communication requirements • Information to be distributed and impact (importance) to the project • Time frame and frequency for required information • Method for updating the stakeholder management plan
• Project documents updates: • Project schedule • Stakeholder register 13-22
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Manage Stakeholder Engagement: Introduction (Reference Manual p. 13-5 PMBOK® Guide p. 404)
• Is part of the executing process group • Involves communicating and working with stakeholders to: • Meet their needs and expectations, handle issues as they occur • Negotiate and communicate to ensure goals are being met • Proactively address concerns before they become issues • Increase support and minimize resistance
• PM must be aware that the ability of stakeholders to influence the project: • Is at its greatest early in the project • Grows progressively lower as the project progresses • PMI: The PM is responsible for managing stakeholders! 13-23
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Unit 13
Manage Stakeholder Engagement (Reference Manual p. 13-6, PMBOK® Guide p. 404)
Inputs
Tools
Outputs
Stakeholder management plan
Communication methods
Issue log
Communications management plan
Interpersonal skills
Change requests
Change log
Management skills
Project management plan updates
OPA
Project documents updates OPA updates
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Inputs to Manage Stakeholder Engagement (Reference Manual pp. 13-6 & 7, PMBOK® Guide pp. 406-407)
• Stakeholder management plan: Addresses the following • Methods and technologies for stakeholder communication • The appropriate level of interaction among stakeholders • Strategies on involving stakeholders
• Communications management plan: Provides guidance on managing stakeholder expectations • Communication requirements • Information to be communicated and who needs to receive it • Escalation process
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Inputs to Manage Stakeholder Engagement (Reference Manual pp. 13-6 & 7, PMBOK® Guide pp. 406-407)
• Change log: Documents the status and expected impact of all changes • No surprises for important stakeholders!!
• OPA: • Organizational communication requirements and procedures • Issue management procedures • Change control procedures • Historical information
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Tools for Manage Stakeholder Engagement (Reference Manual p. 13-7, PMBOK® Guide pp. 407-408)
• Communication methods: During stakeholder management, the following methods may be used— • Interactive • Push • Pull • Note: PMI states that face-to-face meetings are preferred if possible
• Interpersonal skills: The ability to— • Build trust • Resolve conflict • Listen actively • Overcome resistance to change 13-27
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Tools for Manage Stakeholder Engagement (Reference Manual p. 13-7, PMBOK® Guide pp. 407-408)
• Management skills: • Facilitate consensus on project objectives • Build support using influencing skills • Negotiate agreements to meet project needs • Gain organizational acceptance of project outcomes
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Outputs from Manage Stakeholder Engagement (Reference Manual pp. 13-7 & 8, PMBOK® Guide pp. 408-409)
• Issue log: Used to record new issues and document resolution of previous issues • Issue logs appear as part of the HR, Communication, and Stakeholder knowledge areas • Common denominator: People issues
• Change requests: Some stakeholder issues lead to changes • Project management plan updates: • Changes in stakeholder requirements • Revisions of any ineffective communication methods • Actions to address stakeholder concerns or issues
• Project documents updates: Any changes to the stakeholder register 13-29
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Outputs from Manage Stakeholder Engagement (Reference Manual pp. 13-7 & 8, PMBOK® Guide pp. 408-409)
• OPA updates: • Stakeholder notifications about resolved issues • Project records, reports, and presentations • Feedback from stakeholders • Lessons learned from managing stakeholders
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Unit 13
Control Stakeholder Engagement: Introduction (Reference Manual p. 13-8, PMBOK® Guide p. 409)
• Is part of the monitoring and controlling process group • Involves: • Monitoring stakeholder relationships • Adjusting strategies as needed
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Unit 13
Control Stakeholder Engagement (Reference Manual p. 13-8, PMBOK® Guide p. 410)
Inputs
Tools
Outputs
Project management plan
Information management systems
Work performance information
Issue log
Expert judgment
Change requests
Work performance data
Meetings
Project management plan updates
Project documents
Project documents updates OPA updates
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Unit 13
Inputs to Control Stakeholder Engagement (Reference Manual p. 13-9, PMBOK® Guide pp. 411-412)
• Project management plan: Contains the procurement management plan which provides guidelines for managing stakeholders • Techniques for communicating among stakeholders • HR: Roles, responsibilities, reporting, and staffing guidelines • Change management plan • Which processes are relevant to each project phase • How work should be executed to accomplish project objectives
• Issue log: Documentation of new issues and resolution of previous issues
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Inputs to Control Stakeholder Engagement (Reference Manual p. 13-9, PMBOK® Guide pp. 411-412)
• Work performance data: Documentation of actual outcomes • Actual durations and costs • Actual start and finish dates • Percentage of planned work actually completed • Number of defects and change requests
• Project documents: Documents relevant to controlling stakeholder engagement • Project schedule • Stakeholder register • Issue and change logs • Project communications 13-34
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Tools for Control Stakeholder Engagement (Reference Manual p. 13-10, PMBOK® Guide pp. 412-413)
• Information management systems: Standard tools for handling information. PMI identifies the following distribution formats— • Table reports • Spreadsheet analysis • Presentations
• Expert judgment: Used to identify new stakeholders and assess relationships with current stakeholders
• Meetings: Used to exchange information about stakeholder relationships
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Unit 13
Outputs from Control Stakeholder Engagement (Reference Manual pp. 13-10 & 11, PMBOK® Guide pp. 413-415)
• Work performance information: Interpretation of data previously collected so that status can be accurately reported to stakeholders • Status of costs, schedules, and deliverables • Status of change requests • Forecasts of future outcomes
• Change requests: Performance analysis may lead to changes which should always be processed using Integrated Change Control
• Project management plan updates: Possible revisions to any subsidiary management plan • Scope, schedule, cost, quality, HR • Communication, risk, procurement, and stakeholder 13-36
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Unit 13
Outputs from Control Stakeholder Engagement (Reference Manual pp. 13-10 & 11, PMBOK® Guide pp. 413-415)
• Project documents updates: • Stakeholder register • Issue log
• OPA updates: • Stakeholder notifications about resolved issues • Project records, reports, and presentations • Feedback from stakeholders • Lessons learned from managing stakeholders
13-37
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Unit 13
Other Topics • Other Topics covers information known to be on the real exam but not addressed by the PMBOK® Guide: • There are no Other Topics in this Unit!
13-38
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Unit 13
Drill Practice Reminder
Drill practice for this chapter starts on p. 13-13
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Practice Exam: Concepts, Processes, and Integration Management 1. Which of the following is not an important aspect of configuration management? a. b. c. d.
use of a CCB (change control board) establishment of baselines verifying conformance to requirements tracking BCWP (budgeted cost of work performed)
2. During which of the following processes is the majority of the project budget usually spent? a. b. c. d.
initiation planning control execution
3. Which of the following is not an important purpose of progress measurement? a. b. c. d.
assist with feasibility analysis determine whether project performance is on track identify problems so corrective action can be taken provide information to facilitate forecasting of future performance
4. The three-step process of establishing clear objectives, measuring their achievement, and adjusting performance if necessary is known as ______. a. goal programming b. management by objectives c. strategic planning d. analytical hierarchy process 5. Which of the following is not a common problem of project evaluation? a. b. c. d.
it can be threatening to the project team it can be disruptive and time consuming upper management using an evaluation for political reasons the process frequently uses observers from outside the project team
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Concepts, Processes, Integration
6. Your organization has the opportunity to collaborate with a foreign company to develop and market a new biomedical product for worldwide sales. You have been appointed by management to determine whether this project should be initiated. You should prepare a ______. a. b. c. d.
feasibility study project charter make-or-buy analysis scope verification analysis
7. Post-project evaluation should be used to ______. a. b. c. d.
identify and weed out poor performers determine whether the objectives of a project are still relevant keep the project management plan up to date document lessons learned
8. A periodic document covering cost, time, and resource performance is called _____. a. b. c. d.
a status report an engineering change proposal (ECP) mid-project evaluation the project charter
9. Project management plans are usually developed by ______. a. b. c. d.
the project manager the project team engineering marketing
10. Developing standard project management methodologies is the direct responsibility of the _______. a. b. c. d.
portfolio manager operations manager project management office organizational governance function
11. Your team has completed the project management plan. The plan should be distributed to ______. a. b. c. d.
2
the project team and all project stakeholders the project team and the customer the project team people designated by the communications management plan
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12. Your project has been officially authorized through the signing of a written project charter. From an integration management perspective, your next step should be to ______. a. b. c. d.
assemble members of the project team develop a project management plan direct and manage execution of the project manage any changes suggested by key stakeholders
13. The project manager has just received a change from the customer that does not affect the project schedule and is easy to complete. What should the project manager do first? a. b. c. d.
make the change as soon as possible inform the project sponsor and ask for permission go to the change control board evaluate the effect on the triple constraint
14. During the process to monitor and control the project, which output tracks any recommendations for corrective actions, preventive actions, and defect repairs? a. b. c. d.
project management plan updates project document updates change requests expert judgment
15. Approved changes should be reflected in the ______. a. b. c. d.
project management plan production readiness review change management plan quality assurance plan
16. Integrated change control ______. a. is concerned entirely with managing actual changes when they occur b. uses change requests that are not legal unless written c. uses the project management plan as a baseline against which changes are controlled d. has no relationship to the lessons learned process
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Concepts, Processes, Integration
17. The tools of develop project charter include ______. a. b. c. d.
expert judgment and facilitation techniques agreements and statement of work expert judgment and statement of work business case and project charter
18. A charter is a key document in the approval process for any project. Which statements about project charters are true? A project charter _________. i. authorizes the project and gives the PM the authority to acquire and expend resources ii. identifies work packages and includes resource estimates iii. identifies the business need and project objectives iv. provides a definitive cost estimate for the project or phase a. b. c. d.
i, ii, and iii i, iii, and iv i and iii none of the above statements are true
19. Change control systems sometimes permit automatic approval or approval without prior review for some types of changes. An example would be ______. a. b. c. d.
the need to incorporate a necessary design feature the result of an emergency a change suggested by the project sponsor a change identified by the lead engineer
20. Which statement about integrated change control is not true? a. b. c. d.
4
The integrity of the performance baseline must be maintained. The effect of changes across all knowledge areas must be coordinated. Change requests is an output of integrated change control. Approved changes often result in updates to the project management plan.
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Concepts, Processes, Integration
21. Activities such as team building, accomplishing work packages, developing the project team, and quality assurance typically occur during which phase of the project life cycle? a. b. c. d.
initiating executing controlling closing
22. Project variances identify deviations from the project management plan. A variance is most significant if it ______. a. b. c. d.
requires corrective action jeopardizes project objectives is identified as a project risk becomes a lesson learned
23. A work authorization system is a ______. a. work breakdown structure b. formal procedure for sanctioning work so it is done in the proper sequence and at the right time c. method to assign responsibility for specific tasks to team members d. system to measure work completed versus work planned 24. There are advantages and disadvantages to each of the three major organizational structures identified by PMI. The tendency to duplicate facilities, job functions, and resources is a/an ______. a. b. c. d.
advantage of the functional structure advantage of the matrix structure disadvantage of the matrix structure disadvantage of the projectized structure
25. As project manager, your team members are borrowed from various functional managers. You usually have no official role in writing performance appraisals and team members complain that they receive competing task assignments from other project managers as well as their functional manager. Your organizational structure is a ______. a. b. c. d.
weak matrix balanced matrix strong matrix tight matrix
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Concepts, Processes, Integration
26. You are the project manager for a major renovation of the processes for the ecological disposal of turkey by-products in a well-known city in central Texas. You have been on-site for development and testing for six months, the local drinking water smells and tastes “suspicious”, and you have been ready to go home for about five and a half months. Testing is almost complete when your nemesis, Annabeth Tyson, suggests a significant change to the process. The change would probably delay project completion by at least one month. Your first step should be to ______. a. take the matter to the project sponsor who you know does not wish to incorporate any more changes b. ask your primary customer contact what she thinks c. suggest that members of your team take Annabeth out for a drink and try to talk her out of the change d. refer the request to the change committee and assess the potential impact 27. Which of the following is not accurate with regards to a project change control system? a. A change control board should be established. b. Provisions to handle emergency changes should be established. c. A change control system should establish the basic requirements for the project. d. A change control system should include paperwork, tracking, and approval procedures. 28. Your PMO recently indicated to all project managers that project closure activities within the company were being performed inconsistently. The office stated that project closure should ALWAYS accomplish the following objectives: verify and document all project deliverables, coordinate and assure the formal acceptance of those deliverables, and investigate the reasons in the event that any project is terminated before its completion. The PMO also described the desired outputs of closing any project. Which of the following is one of those outputs? a. b. c. d.
accepted deliverables final product, service, or result transition organizational process assets analytical techniques
29. Approved change requests are implemented through which process? a. b. c. d.
6
Develop Project Management Plan Perform Integrated Change Control Monitor and Control Project Work Direct and Manage Project Work
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Concepts, Processes, Integration
30. You have just been assigned to take over a project that is supposed to be about half done. You quickly learn that the project is, in fact, far behind schedule and will probably take over twice as long as originally planned. Worse yet, upper management has been led to believe that everything is going well. What is the BEST thing to do in this instance? a. b. c. d.
try to compress the schedule to bring it back in line with the original plan try to turn the project over to someone you don't like immediately report your findings to upper management proceed as planned and report at the first missed milestone
31. Project management would apply the least to which of the following situations? a. b. c. d.
when a specific deliverable must be produced by a given deadline when a team must provide a cross-functional effort to produce a deliverable when the work is unique when the work is familiar and repetitive
32. As applied to projects, temporary means _____. a. b. c. d.
doing something that has not been done before the project is relatively short in duration the project has a definite beginning and end that uncertainty will be a problem
33. Rolling wave planning involves progressive detailing of the work that must be done for ______. a. b. c. d.
the current phase of the project subsequent phases of the project the current phase and subsequent phases of the project all phases of the project
34. Which statement about configuration management and change control is true? a. b. c. d.
Configuration management is a subset of change control. The chairperson of the CCB is usually the project sponsor. The CCB audits project results to verify conformance to requirements. Configuration management identifies characteristics of the product and establishes baselines.
35. Which of the following is not part of stakeholder management? a. b. c. d.
Identify the stakeholders Determine stakeholder’s needs and expectations Provide “extras” for stakeholders Manage stakeholder’s expectations
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Concepts, Processes, Integration
36. In which process group are the project scope and objectives determined? a. b. c. d.
initiating planning executing closing
37. In which process group are feasibility studies performed? a. b. c. d.
initiating planning executing closing
38. Integrated change control recognizes that projects always evolve and change. A system that accommodates but controls these changes must exist, i.e., all changes must be managed using a consistent process. Change control must also ________. a. provide effective communication so that stakeholders are aware of all changes b. allow baselines to remain flexible c. allow informal changes to be accommodated d. operate with one change control board 39. One of the initiating processes for projects, a project charter is a written document that authorizes a new project. Which of the following statements about the project charter is true? i. The charter leads to the assignment of a project manager; the PM should never be assigned later than the start of project execution. ii. The charter may be signed by the project manager. iii. The charter is usually developed and distributed as part of the planning phase. iv. Expert judgment is an input to developing the project charter. a. b. c. d.
8
i and ii ii and iii i and iv all of the statements are false
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Concepts, Processes, Integration
40. Project management processes are organized into five process groups. They are the fundamental building blocks for how to conduct project management. Which of the following statements about process groups is incorrect? a. b. c. d.
The process groups occur in all phases of a project. One of the process groups is directing. One of the process groups is monitoring and controlling. Process groups may be iterative in that feedback may cause certain process groups, or portions thereof, to be repeated.
41. The matrix organizational structure ______. a. is used to manage multiple projects simultaneously when the organization does not have the resources to staff each project on a full-time basis b. ensures less conflict when compared to other organizational structures c. is used when an organization decides to undertake a single, large project d. allows a stronger focus on cost and schedule objectives than other organizational structures 42. In which organizational approach is the PM likely to have the most authority? a. b. c. d.
expeditor coordinator strong matrix projectized
43. You have just been assigned as project manager for the development of a new pharmaceutical product. Which organizational structure would make managing the human resources the most difficult? a. b. c. d.
functional weak matrix strong matrix projectized
44. As a new project manager, Susan has been assigned to a project in a matrix organization. She can expect communication to be ______. a. b. c. d.
simple complex highly automated horizontal
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Concepts, Processes, Integration
45. A project team member complains that too many people are asking him to do things. If he works in a weak matrix organization, who has more power? a. b. c. d.
stakeholders project manager functional manager board of directors
46. A major part of closing a project or phase involves reviewing accepted deliverables to ensure that all the work has been completed and meets requirements. In fact, accepted deliverables is one of three inputs to Close Project or Phase. Which of the following processes provides the information for accepted deliverables? a. b. c. d.
Direct and Manage Project Work Develop Project Management Plan Validate Scope Collect Requirements
47. A signed charter is a vital step in successfully initiating a new project. The business case is among the inputs used in this important process. The business case helps evaluate whether the project is worth the required investment. Which of the following choices correctly identifies the components of a business case? a. b. c. d.
10
historical information and strategic objectives organizational culture and marketplace conditions business need and narrative description of products business need and cost-benefit analysis
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Concepts, Processes, Integration
Answer Sheet #1 Answer 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. 23. 24. 25.
Answer
Notes
26. 27. 28. 29. 30. 31. 32. 33. 34. 35. 36. 37. 38. 39. 40. 41. 42. 43. 44. 45. 46. 47. 48. 49. 50.
Percent Correct? Pass or Fail? # Misread ?s Other Notes:
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Concepts, Processes, Integration
Answer Key: Concepts, Processes, Integration Management No. Answer
Slides
Note
1
d
4-41
Choice d is related to earned value (not configuration management).
2
d
2-31
PMI historical question. Reference manual p. 2-10: see life cycle, bullet #2 and also PMBOK® Guide pp. 40 & 56.
3
a
3-6 4-9
Feasibility analysis is part of initiating (p. 3-2) rather than monitoring/controlling (pp. 4-10 to 4-13).
4
b
4-54
MBO = 1. Establish clear, realistic objectives, 2. Measure progress, and 3. Take action/adjust, if necessary.
5
d
4-55/56
6
a
4-9
See output 1: Charters are not considered complete until supporting analysis such as a feasibility study has been completed. Also see reference manual, p. 4-4.
7
d
4-56
Documenting lessons learned is a primary objective of post-project evaluation.
8
a
4-31
Status reports identify current performance to date, using variances, and occur on a periodic basis. See introduction to monitor and control, bullet 4.
9
b
4-13
See introduction to develop project management plan. In most situations, the project manager would not have the time or full range of expertise to develop the plan alone.
10
c
2-15
The PMO (project management office) is most directly responsible for establishing standard methodologies.
11
d
4-18
See project management plan, output 1. The communication plan identifies information needs of key stakeholders and establishes distribution lists for project documents.
12
b
3-16
Also see reference manual, p. 3-7. The first integration management process (develop charter) is complete. The second process (develop project management plan) is next. Choice a: “assembling” (acquiring) the team is an executing step (not planning).
13
d
4-27 4-38
You should first evaluate the anticipated effect on the triple constraint. Small, routine changes may not need to go to the CCB.
14
c
4-34
Output 1: change requests are always potentially associated with corrective action, preventive action, and defect repair.
15
a
4-46
Output #3 for integrated change control is to update the project management plan (and any subsidiary plans) and project baselines, as necessary. Choice c: change management plan is how to approve changes; not what to do after the change is already approved.
Choice d is simply a fact about the evaluation process; choices a, b, and c are potential problems.
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Concepts, Processes, Integration No. Answer
Slides
Note
16
c
4-15 4-42
See bullet #5 on slide 4-15. Also, the project management plan is input #1 to integrated change control. This plan provides the baseline against which changes are made.
17
a
4-11
You must be familiar with inputs, tools, and outputs for all 47 processes.
18
c
4-6 4-8/9 4-12
Statement i is true (see slides 4-8/9). Statement ii is false (work packages are identified by a planning process, Create WBS). Statement iii is true (slides 4-6 and 9). Statement iv is false (definitive cost estimates are provided during the latter stages of planning; the charter would provide an initial, ball-park estimate known as an order of magnitude estimate).
19
b
4-40
See bullet #1.
20
c
4-39 4-43 4-46
Change requests is input #3 (not an output).
21
b
3-11
See the list of typical activities for executing (slide 3-11) and the list of processes under the executing column, reference manual p. 3-7.
22
b
No ref
PMI logic and common sense. Choice a seems logical, however, it is not unusual for variances to lead to corrective actions. In choice b, the word “jeopardizes” implies a more serious situation.
23
b
2-24 2-27
Work authorization (right work at the right time in the right sequence) is identified as part of OPA and EEF.
24
d
2-18
See the disadvantages of the projectized structure in the table, reference manual, p. 2-6.
25
a
2-20
Matrix management involves borrowed resources from various functional silos. In particular, a weak matrix usually means the project manager has no official role in performance appraisals, has low spending authority, and competes with other project managers who are also assigning work to the same team members. (reference manual, pp. 2-5/6).
26
d
4-27 4-38
See slide 4-27, last paragraph regarding change requests. Also, see slide 4-38, bullet #3 on review of change requests.
27
c
4-38 to 4-41
28
b
4-48 4-52
Choices a and c are inputs. Choice d is a tool.
29
d
4-20 4-24
See Direct and Manage Project Work, input #2, approved change requests.
30
c
2-6 2-9
Always report accurate, timely information (never hide bad news).
31
d
2-10
Work that is on-going and repetitive is associated with operations.
16
Choice c: Change control does not establish requirements. Other processes identify project requirements (e.g., Collect Requirements and Define Scope).
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Concepts, Processes, Integration No. Answer
Slides 2-10
Note
32
c
Temporary does not refer to short durations but rather to projects having defined start and finish times.
33
c
34
d
4-41
Choice a: the reverse is true. Choice b: the sponsor is not necessarily (or even usually) the chairperson of the CCB. Choice c: the CCB deals with changes and does not perform the final audit required as part of configuration management.
35
c
2-29
Gold-plating is discouraged.
36
a
3-6/7
Slightly tricky, this question refers to the initial, high-level scope (see p. 4-1, project charter) and not the detailed scope that comes later as part of scope planning.
37
a
3-6
See initiating activities: purpose of project assessment is to evaluate project feasibility.
38
a
4-38
Choice b: the integrity of baselines must be maintained. Choice c: “informal change” leads to “scope creep” and loss of control. Choice d: more than one CCB is possible (e.g., large program).
39
d
4-6 to 4-12
The PM should never be assigned later than the start of planning, the PM should not sign the charter (does not improve authority), the charter is developed as part of initiating, and expert judgment is a tool (not an input).
40
b
3-4/5
See the list of process groups and characteristics.
41
a
42
d
2-22
See the description for the projectized structure; it provides the highest authority for a project manager.
43
a
2-19 2-22
A PM has little or no authority in a functional organization, and may not even have a charter.
44
b
45
c
2-20
Functional managers have comparatively more power than project managers in a weak matrix.
46
c
4-50
Accepted deliverables includes deliverables that have been accepted as a result of the Validate Scope process.
47
d
4-10
The business case contains a description of the business need and a cost-benefit analysis. Choices a-c contain information provided by the other inputs to the project charter.
Reference manual p. 2-2: see “two additional characteristics” of projects. It may appear that choices c and d are both correct. However, you must choose the better answer. You are looking for anything that is not complete or represents an exception as a way to eliminate a choice. With choice d, you never plan backwards. So, at the beginning of phase 3 of a project, choice c is still true but choice d might imply re-planning phases 1 and 2 (not realistic).
Reference manual p. 2-6: see the advantages of matrix management.
Reference manual p. 2-6: see bullet #2, disadvantages for matrix management.
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Practice Exam: Scope Management 1. While devising project management plans, project managers must often make assumptions. Assumptions may pose risk to a project because ______. a. b. c. d.
they are based on constraints they involve factors that are believed to be true, real, or certain they are based on lessons learned upper management is too optimistic
2. Which of the following is a constraint in developing the project management plan? a. b. c. d.
a predefined budget lessons learned from previous projects cost performance records from a previous project a list of key resources required for the project
3. The subdivision of project deliverables into smaller and smaller components is called ______. a. b. c. d.
concept definition flow charting decomposition scope verification
4. Detailed descriptions of work packages are contained in ______. a. b. c. d.
the statement of work product specifications WBS cost accounts WBS dictionaries
5. Lessons learned are important because they ______. a. b. c. d.
show why an organization chose specific projects indicate why specific project managers and team members were selected show the causes of variances and the reasons for the corrective actions prove that organizational policies are being followed
6. The document that specifically identifies work that is excluded from the project is the ______. a. b. c. d.
scope management plan project scope statement WBS scope verification plan
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Scope Management
7. As technological complexity increases, the level of uncertainty in defining the work would ______. a. b. c. d.
be unaffected be impossible to predict decrease increase
8. Which of the following best represents a project assumption? a. the equipment for operational testing will arrive, as scheduled, one week before the start of testing b. the budget for the annual company picnic is $50,000 c. the organizational structure currently used is a matrix d. the initial estimate for the Webinator project is $2 million, but you know that the estimate is a rough guess and that the actual budget will change 9. One objective of scope control is to influence the factors that lead to scope changes and to control the potential impact of those changes. Which of the following is a tool of scope control? a. b. c. d.
work performance data change requests expert judgment variance analysis
10. You have been appointed project manager for the development of the “next generation” movie projector for the major U.S. entertainment studios. You decide that you should prepare a WBS to help show the magnitude and complexity of this highly visible and important project. No WBS templates are available to help guide this effort. Your first step should be to ______. a. b. c. d.
identify the major project deliverables determine the cost and duration estimates for each project deliverable identify the components of each project deliverable determine the procedures for making project changes
11. Scope validation is the process of reviewing work results and obtaining formal acceptance of the project scope. Which is not an outcome of this process? a. b. c. d.
2
project management plan updates accepted deliverables change requests project documents updates
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Scope Management
12. You are a project manager for the Environmental Protection Agency located in the Research Triangle Park near several North Carolina universities. Your current environmental remediation project is $250,000 over budget and six months behind schedule. One of your engineers has found a way to reduce costs by incorporating a technology that was not available at the beginning of the project. Which of the following techniques is being used? a. b. c. d.
a force majeure configuration management a value engineering change life-cycle cost analysis
13. Which of the following processes most directly defines and manages stakeholder expectations? a. b. c. d.
Collect Requirements Define Scope Validate Scope Control Scope
14. The process Define Scope results in a written, detailed scope statement. One of the tools is called Alternatives Generation. Which of the following is part of generating alternatives? a. b. c. d.
value engineering expert judgment analysis of alternatives project charter
15. Your neutron exciter project is off to a good start. You have completed the scope management plan, collected requirements and have a written scope statement. Your next scope management step is to _______ and the primary goal is ________. a. validate scope; to ensure that the buyer and seller agree on project scope b. control scope; to identify successes and failures for lessons learned purposes c. consider prototyping; to facilitate design comparisons to choose the most effective technical approach d. create a WBS; document tasks within the project scope
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Scope Management
16. The lowest level of the WBS is called a/an ___________ and has the following characteristics: _______ and _______. a. b. c. d.
task, duration estimate, responsibility assignment activity, duration estimate, responsibility assignment work package, responsibility assignment, identified deliverables work package, duration estimate, primary stakeholder
17. In the WBS, a cost or control account is __________. a. b. c. d.
a summary of the project budget the lowest level at which organizational responsibility is assigned a system which provides a unique numerical identifier for each work package also referred to as level three of the WBS
18. As defined by PMI, the second scope management activity is known as _____ and relies on the ______ as an important source of information. a. b. c. d.
identify stakeholders; interviews identify stakeholders; stakeholder register collect requirements; requirements documentation collect requirements; stakeholder register
19. As one of 47 project management processes identified in the PMBOK® Guide, validate scope is concerned with ________ and belongs to which process group? a. b. c. d.
agreement; planning correctness; executing acceptance; monitoring and controlling acceptance; closing
20. Your team has created a requirements management plan, a requirements traceability matrix, and a written scope statement that has been coordinated with the customer and key stakeholders. The team has also created a WBS that has been decomposed to the work package level. A chart of accounts has been established for the WBS and the detailed information for each task has been documented. What is the next major scope management step that your project team will need to perform? a. b. c. d.
4
control scope validate scope create the WBS dictionary respond to change requests
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Scope Management
21. Control scope is about all the following except ______. a. b. c. d.
controlling the impact of cost changes influencing the factors that create scope changes managing actual scope changes assuring that requested changes are handled using integrated change control
22. Features and functions describes what kind of scope? a. b. c. d.
project scope product scope design scope baseline scope
23. The collect requirements process defines and documents stakeholders’ needs to meet project objectives. Which of the following statements about collecting requirements is true? a. Context diagrams are a primary output for collecting requirements. b. Requirements documentation and document analysis are inputs to collecting requirements. c. Project requirements can include technical and performance requirements. d. The use of facilitated workshops is one of the tools and quality function deployment is one example of such a workshop. 24. Which statement about the WBS numbering system is not true? It ______. a. b. c. d.
is called apportioned effort identifies the level at which specific activities are found allows allocation of costs to individual WBS activities is sometimes referred to as a code of accounts
25. Which of the following statements about the WBS is not true? a. b. c. d.
Each item is generally assigned a unique identifier. Work element descriptions are often collected in a WBS dictionary. Activities at the lowest level of the WBS are referred to as work packages. The WBS and the OBS are essentially the same thing.
26. Change control systems include which of the following? a. b. c. d.
documentation, tracking systems, and approval levels CCB, provision for emergency changes, and audits to verify conformance establishment of requirements decomposition
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Scope Management
27. Having completed the requirements collection process, your next step is to define the scope. Which of the following is not a tool of scope definition? a. b. c. d.
interviews facilitated workshops expert judgment product analysis
28. Scope management should ensure that a project management plan includes all the work required but only the work required to complete the project successfully. This planning must include both product scope (the features and functions embodied in the product or service) and project scope (the management activities required to deliver the product or service). Product scope should be measured against the ________ and project scope should be measured against the ________. a. b. c. d.
statement of work; WBS project management plan; product requirements WBS; project charter product requirements; project management plan
29. In addition to work performance information and change requests, the outputs of control scope are ______. a. scope statement, lessons learned, and WBS templates b. work results, scope changes, and historical information c. organizational process assets updates, project management plan updates, and project documents updates d. scope changes, product documentation, and performance reports 30. Two weeks ago you were called into your supervisor’s office and informed that you had been competitively selected (you were immediately suspicious) for a challenging technical development project. You were advised that the company needs the most cost-effective design possible that will also provide the best functionality. At your first team meeting, your lead engineer described a technique that would analyze the functions inherent in a design, evaluate whether each function is really needed, and assess the most cost-effective way to provide the needed functions without sacrificing quality. Your engineer was describing which tool? a. b. c. d.
6
pareto analysis root cause analysis value engineering configuration management
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Scope Management
31. You have been assigned to a small, but important team charged with quickly defining and documenting the requirements for the renovation of a series of “theme” hotels in cities with major casinos around the world. There are obvious geographical and cultural dimensions to this project. One of the team members suggested using group creativity techniques. Which of the following is not an example of such a technique? a. b. c. d.
brainstorming focus groups affinity diagram nominal group technique
32. The WBS can be used for which of the following? a. b. c. d.
showing calendar dates for tasks describing the business need of the project communicating with the customer identifying each team member’s functional manager
33. Your project is almost complete and the customer wants to make a major change to the scope of work. You should ______. a. b. c. d.
refuse the change accept the change complain to management inform the customer of the impact of the change
34. Which of the following statements about decomposing work into smaller tasks known as work packages is inaccurate? a. b. c. d.
Decompose tasks until they can be realistically estimated. Decompose tasks until they can be completed by one person. Different deliverables can have different levels of decomposition. Excessive decomposition of tasks can result in non-productive management.
35. Which is not a major advantage of using a work breakdown structure? a. b. c. d.
organizes the work in a logical manner provides a sound basis for estimating promotes team buy-in of the project management plan clearly describes the project work down to the smallest sub-tasks
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Scope Management
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Scope Management
Answer Sheet #1 Answer 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. 23. 24. 25.
Answer
Notes
26. 27. 28. 29. 30. 31. 32. 33. 34. 35. 36. 37. 38. 39. 40. 41. 42. 43. 44. 45. 46. 47. 48. 49. 50.
Percent Correct? Pass or Fail? # Misread ?s Other Notes:
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Scope Management
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Scope Management
Answer Key: Scope Management No.
Answer
Slides
Note
1
b
5-32
Assumptions pose risk because they deal with unknowns and might be incorrect.
2
a
5-32
A limited budget is a classic constraint. Choices b and c are historical records available from the knowledge base. Choice d is stated as an estimate. If Choice d indicated that resource availability was limited to a certain level, it would then be a constraint.
3
c
5-34 5-39
See tool #1, decomposition.
4
d
5-37 5-41
WBS dictionary contains detailed descriptions for every work package.
5
c
5-64
See output #5. Lessons learned identify the causes of problems and the corrective action that solved the problems.
6
b
5-24 5-32
Exclusions from the project scope should be listed in the scope statement.
7
d
5-26
See key points, bullet #1. Common sense.
8
a
5-32
Choice a: note that assumptions are future oriented. Choice b is a constraint, c is a fact, and d depends on the wording (as worded, it states that initial estimates usually change as the project progresses; progressive elaboration).
9
d
5-62
The only tool for control scope is variance analysis.
10
a
5-38 5-40
Choice a represents the “top down” approach to a WBS (identify major deliverables at a high level) and is the best choice (see input #2). Choice c refers to the “bottom up” approach (start with a list of every detailed work package. Choice c would be difficult for a situation with no templates available and a new technology involved.
11
a
5-55 5-56
See the list of outputs for validate scope. Choice a is not an output.
12
c
5-63
See output #2 for control scope and note the reference to value engineering. VE is aimed at incorporating the advantages of better technologies and also at reducing costs through superior alternatives.
13
a
5-13
Note bullet #2 in the introduction for collect requirements. This process is highly focused on stakeholder expectations.
14
c
5-28
See tool #3 for define scope, alternatives generation.
15
d
5-2 & 5 5-34
16
c
5-36 5-40
The first three scope management processes have been completed. The next process is Create WBS. The lowest level in the WBS is the work package. Different deliverables often have different levels of decomposition.
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Scope Management No.
Answer
Slides
17
b
5-40
See output #1, WBS, control accounts.
18
d
5-13 5-17
Collect requirements is the second scope management process and the stakeholder register is a primary input.
19
c
5-49 5-51
Validate scope is aimed at formal acceptance (signing off on the work) and is part of monitoring and controlling.
20
b
5-49
The first four scope processes are complete; the next process is validate scope.
21
a
5-57
Control scope does not deal with cost changes (choice a).
22
b
5-3
Product scope identifies features and functions.
23
d
5-13 to 5-23
24
a
5-37
Choice a: there is no such term associated with the WBS. Also see reference manual p. 5-14.
25
d
5-37
See key points, bullet #3, definition of OBS.
26
a
5-57
Choice a: see bullet #3. Choices b, c, and d are all part of configuration management.
27
a
5-28 5-29
Interviews is a tool of collect requirements.
28
d
29
c
5-63 5-64
See outputs for control scope.
30
c
5-63
Value engineering evaluates a potential design as to whether there is a more cost-effective approach for meeting requirements.
31
b
5-18 to 5-21
32
c
5-45
See bullet #9 (2nd to last).
33
d
5-57
Always follow integrated change control procedures. Never automatically accept or refuse a change.
34
b
35
d
14
Note
Choice d is unequivocally true. Choice a is a tool, not an output. Choice b: an output and tool, not inputs. Choice c: is for product requirements, not project requirements.
See reference manual p. 5-1: bullet #1 on product scope.
Focus groups is a separate tool of its own (not part of group creativity techniques).
Choice b might be true in some cases but is not a rule. See reference manual p. 5-13. 5-45
See last bullet.
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Practice Exam: Time Management 1. Which of the following is not a type of network logic used in establishing activity dependencies? a. b. c. d.
critical logic hard logic preferential logic external logic
2. Your team has agreed on the preferred activity sequences for your South Entrance Security program. Durations have been estimated and resource availability to support the schedule has been verified. In displaying the resulting schedule, __________ would generally illustrate __________ better than network diagrams. a. b. c. d.
milestone charts; activity sequencing milestone charts; the critical path bar charts; resource trade-offs bar charts; progress or status
3. Fast tracking involves ______. a. b. c. d.
developing workarounds for problems that have occurred in the past an increase in schedule risk meeting schedule objectives by doing the job right the first time reducing delays through better allocation of resources
4. A team member just informed you that resource availability was just reduced across the entire organization. Unfortunately, you now have more tasks scheduled for next week than the resources available can possibly handle. One potential solution for this predicament is to employ ______. Ideally, this technique would make maximum use of activities _______. a. b. c. d.
resource leveling; with positive float resource leveling; on the critical path crashing; with negative float crashing; with zero float
5. If you expect an activity to take three days and it takes two days, the variance is ______. a. b. c. d.
+5 days +1 day -1 day -5 days
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Time Management
6. Tasks A, B, and C have durations of 12 days each and are performed in sequence using finish-to-start dependencies. Task D has a duration of 10 days and a finish-tofinish dependency with Task A. What is the late finish for Task A and Task D? a. b. c. d.
Task A = 36 and Task D = 36 Task A = 12 and Task D = 12 Task A = 36 and Task D = 12 Task A = 12 and Task D = 36
7. You have been a project manager for more than twenty years and have noticed that schedule changes tend to increase project costs. As a result of your experience and recent project management certification, you know that schedule changes are handled using the Control Schedule process. Which of the following is not a tool for Control Schedule? a. b. c. d.
change requests resource optimization techniques leads and lags performance reviews
8. Which of the following describes an approach to crashing the project? a. b. c. d.
achieving planned duration by doing the job right the first time achieving planned duration by getting more cooperation from the stakeholders reducing project duration by appropriate use of overtime reducing project duration by doing more work in parallel
9. Scheduling heuristics are ______. a. b. c. d.
optimal solutions shortest possible durations methods for doing more work in parallel rules of thumb
10. The major difference between a milestone and an activity is that milestones ______. a. b. c. d.
2
have zero duration have zero float can only be delayed with proper approval are identified by customers
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Time Management
11. The objective of fast tracking a project is to ______. a. b. c. d.
add resources to critical activities reduce the project duration reduce the number of resources needed by the project provide faster status reporting
12. You are kicking off a complex project that seems to have numerous loops and conditional branches. A more experienced colleague recommended a technique that is not used as much as traditional network diagrams but is capable of dealing with your situation. Which of the following did she recommend? a. b. c. d.
PERT GERT Critical chain method CPM
13. If an activity lies on the critical path, its total float will normally be: a. b. c. d.
greater than its free float positive zero negative
14. Precedence diagrams are often preferred over arrow diagrams because they ____. a. b. c. d.
handle a large number of activities better simplify scheduling by avoiding overlapping activities do not require dummy activities allow the project manager to identify the critical path
15. Which of the following items best identifies all the tasks that must be included in the schedule? a. b. c. d.
the master schedule the WBS the technical baseline the network diagram
16. The schedule baseline ______. a. b. c. d.
is less important than the scope baseline does not consider resource availability can only be determined accurately with computer analysis is used to measure project schedule performance
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Time Management
17. Your project is facing significant issues with respect to limited resources. You recently heard about an alternate scheduling technique that is designed for such situations. Rather than managing float, this technique relies on the use of ______ and is called ______. a. b. c. d.
leads and lags; fast tracking project buffers; simulation duration buffers; critical chain method duration buffers; resource smoothing
18. Which of the following statements about float (slack) is true? a. the project manager may use float as a guide in making resource assignments b. the project manager should generally use available float as early in the project as possible c. negative float is not of concern if enough activities have positive float d. negative float can often be reduced by slowing the project expenditure rate 19. In a network logic diagram, the critical path is the ______. a. b. c. d.
path that contains the most important activities most expensive path through the network shortest path through the network longest path through the network
20. ______________ is an indication of scheduling flexibility. a. b. c. d.
Early start Late start Slack Near-critical path
21. Activity definition is an essential, early step in building an accurate project schedule. If the activity list is inaccurate, then the schedule will also be inaccurate. Which of the following is an output of defining activities? a. b. c. d.
4
milestone list decomposition activity list updates activity dependencies
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Time Management
22. In the arrow diagramming method, __________ is a constraint that does not require an expenditure of resources. a. b. c. d.
a logical dependency a dummy activity a successor the critical path
23. Your project to update the security system for a major bank involves work that is uncertain and difficult to estimate. You have decided to try using PERT to get a better idea of the range of possible durations for this work. Accordingly, you have asked several experts to come up with three estimates (best case, worst case, and most likely). The estimates they provided were 7 days, 19 days, and 10 days respectively. Using PERT, what is the expected average duration for this work? a. b. c. d.
10 days 11 days 12 days PERT is not used for this type of estimating
24. There are organizations that have performed studies of how long it “should take” to perform certain activities. The information is often useful in estimating activity durations. This technique is known as ______ and is a ______ of estimate activity resources. a. work analysis; tool b. work analysis; output c. published estimating data; tool d. published estimating data; output 25. Which of the following dependency descriptions is incorrect? a. Finish-to-start: Initiation of the successor depends on completion of the predecessor. b. Finish-to-finish: Completion of the successor depends on completion of the predecessor. c. Start-to-start: Initiation of the successor depends on initiation of the predecessor. d. Start-to-finish: Initiation of the predecessor depends on completion of the successor. 26. Resource leveling will generally ______. a. b. c. d.
require more resources in the long run delay the end date of the project reduce total costs for the project have no effect on the schedule
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Time Management
27. Your experience and training have taught you that identifying the critical path is crucial for establishing accurate expectations about schedule outcomes. Which is the least correct statement about the critical path? a. b. c. d.
The critical path is the shortest time in which the project can be completed. The critical path is the longest path. The critical path has the least float. The critical path has zero float.
28. The project activity list should generally ______. a. b. c. d.
be organized by WBS element include only those activities on the critical path include only those activities with confirmed resource assignments include only those activities with confirmed start dates
29. If the end date of an initial plan is later than the desired date, which of the following should generally be tried first? a. start non-critical path activities at their early start dates b. examine the activity sequences to determine whether more work can be done in parallel c. add more resources to critical path activities d. negotiate a reduced scope for any activities with negative float 30. When compared to scheduling results using CPM and Monte Carlo simulations, the project duration calculated using PERT will most likely be ______. a. b. c. d.
more pessimistic than CPM and more optimistic than Monte Carlo simulation more optimistic than CPM and more pessimistic than Monte Carlo simulation more pessimistic than either CPM or Monte Carlo simulation more optimistic than either CPM or Monte Carlo simulation
31. The roof must be built before the roof can be shingled is an example of a/an ______. a. b. c. d.
external dependency internal dependency mandatory dependency discretionary dependency
32. Lag time is ______. a. b. c. d.
6
derived from a forward and backward pass waiting time the time a task can be delayed without delaying the project completion the time a task can be delayed without delaying the successor task
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Time Management
33. Which project management tool would show the critical path? a. b. c. d.
WBS project charter milestone chart network diagram
34. Your most recent project management training class suggested that project managers should be proficient in all aspects of the use of float. Which of the following statements about free float is correct? Free float ______. a. identifies resources assigned to the project that are not actively working on project tasks b. identifies how long a task can be delayed without causing a delay in the project c. identifies how long a task can be delayed without causing a delay in the start time of the immediate successor d. identifies how much time it will take to complete the remaining work on the project 35. Given the data provided below, which activity should be crashed to reduce the project duration by one day? All times are in days. Task Start A B C D End a. b. c. d.
Predecessor -Start A Start C B, D
Normal Time -4 5 4 6 --
Crash Time -4 3 2 4 --
Crash Cost per day -N/A $20 $50 $35 --
A B C D
36. If you are more constrained by resource availability than by cost or schedule, you might ______. a. b. c. d.
employ the concept of crashing to conserve resources employ resource leveling to make the best use of scarce resources use Monte Carlo simulation use fast tracking to conserve resources
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Time Management
37. A project with multiple critical paths ______. a. b. c. d.
will need more resources than usual is more risky is not possible (there is only one critical path) must be analyzed using computerized tools
38. How does standard deviation relate to risk? a. b. c. d.
Standard deviation indicates how unsure the estimate is. Standard deviation indicates the extent of management reserve. Standard deviation has no bearing on risk. Standard deviation calculates additional resources needed during crashing.
39. You already have limited resources and have been told that increasing resources on your project is simply not going to happen. However, you have also been told that you must find a way to stay on schedule. Which of the following is your best option? a. b. c. d.
resource leveling crashing fast tracking GERT
Use the following information to answer questions 40-42. You have been hired by the National University of Singapore to manage a facilities renovation project. The first part of the project, as the University conceived it, consists of four major tasks and you have collected the information in the following table: Task
Early Finish
Late Finish
A
4
5
B
8
8
C
12
15
D
20 (revised scheduled finish)
15
40. Which task has the most float? a. b. c. d.
8
Task A Task B Task C Task D
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Time Management
41. Which task has the least float? a. b. c. d.
Task A Task B Task C Task D
42. Which task most threatens completing the project on time? a. b. c. d.
Task A Task B Task C Task D
43. Which of the following terms is not associated with a precedence diagram? a. b. c. d.
critical path slack dummy task lag
44. The default display in many project management software programs is the Gantt chart, which is also called a bar chart. A distinctive advantage of the Gantt chart is that it _____. a. b. c. d.
clearly shows any schedule variances is the best way to view the critical path identifies dummy tasks is the preferred way to show high-level schedule status to customers
45. Which of the following is a key characteristic of an arrow diagram? a. b. c. d.
lag dummy task finish-to-finish dependency critical chain
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Time Management
46. How much free float is on the critical path of the schedule defined by the following table? All dependencies are finish-to-start except that Task I is finish-to-finish with H. Task Start A B C D E F G H I J End a. b. c. d.
Predecessor -Start Start Start A,B A,B,C D,E C,E F,G G,H(Finish-to-Finish) I J
Duration (days) -3 5 5 6 4 3 10 4 2 3 --
26 days 7 days 5 days 0 days
47. You are searching for more effective ways to do management presentations of schedule status on complex projects with large numbers of interdependent work packages. Increased use of ______ would be an effective way to display summary results to upper management. a. b. c. d.
arrow diagrams hammock activities critical chain diagrams precedence diagrams
48. Your project has fallen behind schedule due to conflict between team members. You have resolved the conflict. What should you consider to get the project back on schedule? a. b. c. d.
10
crashing resource leveling resource smoothing adding lag times along the critical path
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Time Management
Answer Sheet #1 Answer 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. 23. 24. 25.
Answer
Notes
26. 27. 28. 29. 30. 31. 32. 33. 34. 35. 36. 37. 38. 39. 40. 41. 42. 43. 44. 45. 46. 47. 48. 49. 50.
Percent Correct? Pass or Fail? # Misread ?s Other Notes:
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Time Management
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Time Management
Answer Key: Time Management No. Answer
Slides
Note
1
a
6-29
Critical logic is not one of the types of dependencies identified by PMI.
2
d
6-87
See output #2, project schedule. Bar charts are easy to read and show schedule variances very clearly.
3
b
6-76 6-81
See tool #7,schedule compression. One potential effect of fast tracking is an increase in risk related to resource assignments.
4
a
6-74
See tool #4, resource optimization: resource leveling.
5
b
6-94
See tool #1, performance reviews. Variance is calculated as plan minus actual (3-2 in this example).
6
d
6-20 6-44 & 45
You must connect task D to end (or you will not have a legitimate way to determine the late finish for task D). A & D are finish-tofinish but are not both on the critical path.
7
a
6-94 to 6-97
Change requests is an output (not a tool).
8
c
6-76
Overtime is a form of crashing (more time from the same people). Choice d is fast tracking.
9
d
6-74
See tool #4, resource leveling. Heuristics are guidelines or rules of thumb.
10
a
6-17
Milestones are important points in time but have no duration.
11
b
6-76
Both types of schedule compression (crashing and fast tracking are aimed at shortening the schedule).
12
b
6-101
See other topics, GERT.
13
c
6-71
See tool #2, critical path method.
14
c
6-28
PDMs do not require dummy tasks.
15
b
5-44 5-45 6-67
PMI has historically emphasized the WBS as the best way to get an accurate activity list and therefore produce an accurate schedule. Define Activities produces the activity list that becomes an input to Develop Schedule. The WBS is a major input in defining that activity list.
16
d
6-86
See output #1, schedule baseline.
17
c
6-73
Critical chain manages duration buffers rather than float and the critical path.
18
a
6-38 6-71
Choice b: as a rule, float is saved until needed. Choice c: an activity with positive float is non-critical and cannot make up for a task with negative float (and would also be on a different path).
19
d
6-71
See tool #2, critical path method.
20
c
6-71
Slack or float indicates the flexibility to delay work, if needed.
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Time Management No. Answer
Slides
Note
21
a
6-16 6-17
Choice b is a tool. Choice c: associated with sequencing, see output #2, project documents updates. Choice d: associated with sequencing, see tool #2.
22
b
6-32 6-33
Dummy activities are “fictitious” activities that have no duration, resources, or actual work. They are used in arrow diagrams whenever multiple dependencies exist.
23
b
6-78
PERT average duration = (O + 4M + P) / 6
24
c
6-51
See tool #3, published estimating data.
25
d
6-23 to 6-27
26
b
6-74
See tool #4, resource leveling.
27
d
6-71
The critical path has zero float unless you are behind schedule (then you have negative float). Choices a, b, and c are always true. Choice d has exceptions (when you are behind or ahead of schedule).
28
a
6-12
PMI has always centered on the use of the WBS in defining an accurate activity list. Choices b, c, and d are incorrectly trying to limit the activity list to include “only” certain types of activities.
29
b
6-76
Choice a: would not solve the problem. Choice b: is fast tracking and is the correct choice. Choice c: is crashing and adds cost (it may be necessary but is not the preferred “first resort”). Choice d: reducing scope would be a last resort.
30
a
6-99 6-100
See other topics, Monte Carlo analysis.
31
c
6-29
Mandatory dependencies involve physical or technical limitations in the nature of the work, i.e., work that cannot be done in parallel.
32
b
6-29 6-43
See tool #3, applying leads and lags.
33
d
6-87
See output #2, project schedule.
34
c
6-39 6-46
Free float is how long you can delay a task and not delay the early start of the immediate successor task.
35
d
6-81 to 6-85
You must draw the network and find the critical path (C,D). Task D is the cheapest, crashable task.
36
b
6-74
Choice a: crashing usually requires more resources (not less). Choice c: simulations are used for risky, complex projects of high cost (it is not aimed at conserving resources). Choice d: aimed at reducing the schedule (not resources).
37
b
6-72
See tool #2, critical path method. More than one critical path is possible and increases risk.
16
Choice d is stated backwards (the predecessor does not depend on the successor).
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Time Management No. Answer
Slides
Note
38
a
6-63
Standard deviation provides one way to measure whether an estimate has a wide or narrow range. Estimates with wide ranges indicate work that is uncertain or risky (basic knowledge of statistics).
39
c
6-76
Crashing requires more resources (which are not available). Fast tracking allows improvement of the schedule without additional resources.
40
c
6-40 to 6-42
Float = Late Finish-Early Finish. Task C has the most float at +3 days.
41
d
6-40 to 6-42
Task D has the least float at -5 days (it is behind schedule).
42
d
6-40 to 6-42
Because it is currently behind schedule, task D is the greatest threat to not completing the work on time.
43
c
6-32 to 6-34
Dummy tasks are used in arrow diagrams but are not part of precedence diagrams.
44
a
6-87
45
b
6-32 to 6-34
46
d
6-71
Float and free float on the critical path will be zero; you do not need to work this complicated diagram.
47
b
6-87
Hammock activities are summary level activities that show the total time span between the initial start of the first activity and the finish of the last activity in a series.
48
a
6-76 6-81
Choice b: will make the project fall further behind. Choice c: the rules for smoothing do not allow the schedule to change. Choice d: adding lags would further delay project completion.
Gantt charts use horizontal bars and a time scale. The empty bar shows the plan and the darkened portion shows actual work accomplished. It is visually easy to determine schedule progress or variances with Gantt charts. Dummy tasks are used in arrow diagrams but are not part of precedence diagrams.
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Practice Exam: Cost Management Use the following information to answer questions one through four below: PV = $2,200 EV = $2,000 AC = $2,500 BAC = $10,000 1. Using earned value analysis, what is the schedule variance and status of the project described above? a. b. c. d.
-$200 and the project is behind schedule +$200 and the project is ahead of schedule -$300 and the project is ahead of schedule +$8,000 and the project is exactly on schedule
2. What is the CPI for this project and what does it tell us about cost performance thus far? a. b. c. d.
.20; actual costs are exactly as planned .80; actual costs have exceeded planned costs .80; actual costs are less than planned costs 1.25; actual costs have exceeded planned costs
3. What is the cost variance? a. b. c. d.
+$300 -$300 +$500 -$500
4. Assuming current variances are typical of future performance, what is the EAC and what does it represent? a. $10,000; the original project budget b. $12,500; the original project budget c. $10,500; the revised estimate for total project cost (based on performance thus far) d. $12,500; the revised estimate for total project cost (based on performance thus far)
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Cost Management
5. Life Cycle Cost (LCC) estimates consider ______. a. the total life cycle costs of the project (initiating, planning, executing, and closing) b. the differential cost of owning and operating a system c. the total cost of acquisition as well as operations and maintenance d. the total project cost at the time of customer acceptance 6. Accelerated depreciation allows a company to write capital expenses off their taxes more quickly. Which of the following is a recognized method of accelerated depreciation? a. b. c. d.
straight line double declining balance rapid capital deduction accumulated cash analysis
7. You have completed one year on the troubled Yucky Mountain nuclear waste disposal project. Numerous concerns have surfaced about the project and you have been directed to perform analysis and recommend either terminating or continuing the project. The $2.5 million already spent is referred to by finance experts as _________ and experts contend that these costs should ___________ considered in making the decision to continue the project or not. a. b. c. d.
sunk costs; not be allocated costs; not be direct costs; be amortized costs; be
8. The cost of investing in a particular project and therefore giving up the potential benefits of other projects is known as ______. a. b. c. d.
variable cost fixed cost opportunity cost indirect cost
9. Which of the following estimates would most closely predict the actual cost of a project? a. b. c. d.
2
Order of magnitude Budget Definitive Parametric
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Cost Management
10. Which of the following is one possible approach for developing parametric cost estimates? a. b. c. d.
WBS learning curve analysis payback period factor analysis
11. Your project is running behind schedule and you decide to crash the network to catch up. Which of the following rules should you follow? a. b. c. d.
Begin noncritical tasks at their early start times. Use resource leveling to optimize the productivity of project resources. Crash the tasks that have the longest duration. Crash critical tasks whose cost of crashing is lowest.
12. Learning curve theory states that in repetitive production of many items ______. a. production equipment that requires less operator training results in lower unit costs b. unit costs decrease as production rates increase c. unit costs decrease in a regular pattern as more units are produced d. costs of training increase as the level of automation increases 13. Which of the following is not an example of a direct cost? a. b. c. d.
Salary of the project manager Subcontractor expenses Materials used by the project Insurance
14. Your project budget was estimated at $2,000,000. The third monthly status report revealed that $500,000 worth of work was complete and that $750,000 had been spent. Your team believes that current variances will not be indicative of remaining performance. What is the EAC? a. b. c. d.
$3,000,000 $2,000,000 $2,750,000 $2,250,000
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Cost Management
Using the following information, answer questions 15 and 16: Variable costs = $100 per unit Fixed costs = $2,500 15. What is the cost of producing 20 units? a. b. c. d.
$4,500 $2,600 $2,500 $2,000
16. What is the cost of producing 10 additional units? a. b. c. d.
$25,000 $2500 $1000 $600
17. As of the fourth month on the Acme project, cumulative planned expenditures were $100,000. Actual expenditures totaled $120,000. How is the Acme project doing? a. b. c. d.
The project is ahead of schedule The project is in trouble because of a cost overrun The information available is insufficient Project costs are within a normal range
18. Present value is the ______. a. b. c. d.
after-tax value of working capital value today of future cash flows total budget as of today total budget as of today plus management reserve
19. Working capital is defined as ______. a. b. c. d.
4
current assets less current liabilities funds reserved for bid and proposal costs funds set aside for unforeseen problems the sum of cost plus profit
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Cost Management
20. As the chairman of the project selection committee, you are reporting the findings after assessing the following four projects: Project A B C D
Duration 3 years 2 years 3 years 4 years
Net Present Value $40,000 $30,000 $35,000 $40,000
What do you plan to report? a. Projects A and C are the two best choices; Project A is preferred with the highest NPV b. Projects A and D are the two best choices; Project A is preferred because the payback occurs more quickly c. Project B is preferred because the payback occurs faster than any other project d. Projects A and D have equal financial value to your organization 21. Which of the following statements about management reserve is/are true? i. Management reserve is intended to reduce the chance of a cost overrun ii. Management reserve funds may be used to fund work not originally authorized for the project iii. Management reserve funds may be used to fund unforeseen problems a. b. c. d.
i and ii i and iii ii and iii i, ii, and iii
22. According to the law of diminishing returns, ______. a. b. c. d.
short people are best suited to some kinds of work using fewer resources will result in greater profit using more resources will result in proportionately less and less output using more resources will result in the project taking less time
23. Which of the following is a cost reduction tool aimed at: a) analyzing a design, b) determining the necessary functions, and c) assessing how to provide those functions at the lowest cost without degrading performance or quality? a. b. c. d.
Pareto diagram Kanban Configuration management Value analysis
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Cost Management
24. Which of the following statements are true regarding benefit cost-ratios (BCR)? i. A BCR greater than zero indicates a profitable project ii. A BCR of 2.5 represents a gross payback of $2.50 for each dollar invested iii. Benefit-cost ratio represents the average rate of return on the money invested in a project a. b. c. d.
i ii iii ii and iii
25. Analysis of payback period determines __________. a. b. c. d.
which project will become profitable most quickly the future value of money invested today the ratio of discounted revenues over discounted costs the first time period in which a financial profit occurs
26. Your project involves inspecting the operating, maintenance, and security procedures of nuclear energy facilities. The latest status report showed the CPI to be 0.88 and the SPI to be 0.93. What is your cost and schedule status? a. You have a cost overrun and are behind schedule. b. You have a cost underrun and are ahead of schedule. c. You have spent 88 percent of the budget and have completed 93 percent of the work. d. There is insufficient information to determine cost and schedule status. 27. Which statement about bottom-up cost estimating is not true? The concept _____. a. identifies cost estimates for WBS work packages b. aggregates work package estimates to yield a cost estimate for the entire project c. is an example of an order of magnitude estimate d. is considered a very accurate form of definitive estimating 28. IRR is a quantitative measure of a project’s expected profitability and can be thought of as ______. a. b. c. d.
6
after tax profit reported to the IRS the average rate of return for the project the estimate at completion minus the budget at completion the cost variance percentage
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Cost Management
29. Given the following information on the XYZ project, what is the expected outcome? (Assume current variances are typical of future performance)
Original project budget was $400,000 The current BCWP is $200,000 The current BCWS is $180,000 The current ACWP is $250,000
a. b. c. d.
The project will finish with a positive cost variance The estimate to complete is about $100,000 The project will finish with a cost overrun of $100,000 There is insufficient information to evaluate the project
30. Your project’s budget is $500,000. The planned value as of today’s reporting period is $300,000. The project is 50% complete and 60% of the budget has been spent. The earned value for the project is ______ and the project is ________. a. b. c. d.
$300,000; behind schedule $300,000; on schedule $250,000; ahead of schedule $250,000; behind schedule
31. EAC is a periodic evaluation of ______. a. b. c. d.
value of work performed cost of work completed what it will cost to finish the job estimated total cost at project completion
32. Analogous estimating ______. a. b. c. d.
relies on actual historical costs is a form of bottom-up estimating is a form of top-down estimating is used most often during the implementation phase
33. A CPI of .75 indicates that ______. a. b. c. d.
you have spent 75% of your budget you have a cost underrun you are over budget your marginal tax is 25%
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Cost Management
34. You just completed estimating the cost of a project to renovate an elementary school and install a security and fire-alarm system that meets current city codes. The estimate is $100,000 but experience with projects of this type leads you to believe that the actual costs could range anywhere from $90,000 to as much as $125,000. What kind of estimate have you created? a. b. c. d.
order of magnitude estimate budget estimate definitive estimate parametric estimate
35. An order of magnitude estimate would normally be made during which project management phase? a. b. c. d.
initiation planning executing closing
36. You are in the second month of clinical trials on the development of a new drug which your company is planning to call “Awake”. The target market is professional, long-haul drivers and college students who procrastinate on their work. You think things are going pretty well but are about to look at some earned value data to find out for sure. The data show that the CPI is 0.96 and actual costs are $50,000. Given these data, what is the earned value? a. b. c. d.
$48,000 $50,000 $52,083 there is not enough information to determine the earned value
37. The CPI on the Awake project is 0.96 and you have calculated the EAC as $312,500. What was the original budget (BAC) for the project if you believe that current variances are typical for the remaining work? a. b. c. d.
8
$325,521 $312,500 $300,000 there is not enough information to determine the budget at completion
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Cost Management
38. You just assumed the PM role for a virtual team with members in six different geographical locations. The project is using earned value analysis and the data for the latest month showed the EV (BCWP) to be $126,000, the PV (BCWS) to be $120,500, the AC (ACWP) to be $130,000, the BAC to be $600,000, and the percent complete to be 0.21. What is the earned value at this point? a. b. c. d.
$600,000 $126,000 $130,000 $120,500
39. Which statement best explains the declining SPI in the graph shown below? a. b. c. d.
the project started late insufficient resources are available to the project team materials cost less than anticipated a portion of the work was outsourced
CPI 1.0 SPI
40. Most organizations prefer to avoid large changes in spending during any portion of a fiscal year (for example, a huge spike in spending for the third fiscal quarter). A technique for reducing such fluctuations is known as ______ and is ______. a. b. c. d.
funding limit reconciliation; a tool of estimate costs funding limit reconciliation; a tool of determine budget reserve analysis; a tool of estimate costs reserve analysis; a tool of determine budget
41. You are not quite half done with your project to upgrade the company’s I.T. systems. The latest status showed a CPI of 0.90 and you have been asked what your cost performance must be for the remainder of the project if you are to finish on budget. What formula should you use? a. b. c. d.
To-Complete Performance Index; (BAC – EV) / (BAC – AC) To-Complete Performance Index; (EV + AC) / BAC Variance at completion; BAC minus EAC Variance at completion; BAC / CPI
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Cost Management
42. You have received information for your next status report that shows that $80,000 of work has been completed on your $300,000 computer upgrade project. The baseline called for $86,000 to be completed at this point. You have spent $75,000. Your percent spent is ______ and the SPI (schedule performance index) is ______. a. b. c. d.
25%; .93 (ahead of schedule 25%; .93 (behind schedule) 26.67 %; 1.07 (ahead of schedule) 26.67%; 1.07 (behind schedule)
43. You are reviewing the latest earned value data and note that the CPI is 0.83 and the SPI is 0.89. Your project ______. a. b. c. d.
has a cost underrun and is behind schedule has a cost underrun and is ahead of schedule has a cost overrun and is behind schedule has a cost overrun and is ahead of schedule
44. Your current status report reveals that the planned value of the work at this point is $500,000. It further shows that 50% of the $1,000,000 BAC has been completed and that 55% of the project budget has been spent. The data also show that 2 tasks are behind schedule. What is the SPI and what does it mean? a. b. c. d.
SPI = 1.0; the project is exactly on schedule SPI = 1.0; the project is behind schedule SPI = .9091; the project is ahead of schedule SPI = .9091; the project is behind schedule
45. A project’s payback period occurs when ______. a. b. c. d.
10
profit has been maximized unit profit is reached monthly revenue exceeds monthly costs cumulative revenue equals or exceeds cumulative costs
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Cost Management
46. You have been tasked to report on the financial advisability of a large (for your organization) education technology improvement project. Your boss specifically asked you to use ROI (return on investment) in your analysis. After several meetings with the best resident experts you could identify, you have gathered the following estimates: The most likely cost of the project: $250,000 Direct revenues from the project: $410,000 You plan to report that the ROI for this project is ______ and that any ROI above the value of ______ indicates a likely profit. a. b. c. d.
1.64 (164%); one 1.64 (164%); zero 0.64 (64%; one 0.64 (64%); zero
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Cost Management
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Cost Management
Answer Sheet #1 Answer 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. 23. 24. 25.
Answer
Notes
26. 27. 28. 29. 30. 31. 32. 33. 34. 35. 36. 37. 38. 39. 40. 41. 42. 43. 44. 45. 46. 47. 48. 49. 50.
Percent Correct? Pass or Fail? # Misread ?s Other Notes:
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Cost Management
Answer Key: Cost Management No. Answer
Slides
Note
1
a
7-48
EV - PV = 2,000-2,200 = -$200. Negative variances are bad.
2
b
7-47
EV/AC = 2,000/2,500 = 0.80. Indexes less than one are also bad.
3
d
7-47
EV - AC = 2,000-2,500 = -$500. Cost overrun.
4
d
7-50
EAC = BAC / CPI = 10,000/0.80 = $12,500
5
c
7-4
Life cycle cost considers project costs, operating costs, maintenance costs, and potential disposal costs (if relevant).
6
b
7-77
Accelerated methods of depreciation include double declining balance and sum of the years digits.
7
a
7-67
Sunk cost is money already spent that cannot be recovered. Sunk cost should not be considered when deciding whether to finish a project.
8
c
7-67
Opportunity cost is the benefit you give up in deciding not to perform a specific project.
9
c
7-14
The definitive estimate has the most narrow range of accuracy at -5 to +10%.
10
b
7-76
Learning curve analysis uses a parametric called the rate of learning to model the reduction in labor hours required to do repetitive tasks.
11
d
6-81 to 6-85
Choice a: non-critical tasks have no direct bearing on improving the schedule. Choice b: usually results in a schedule slip. Choice c: won’t help if the tasks are not on the critical path.
12
c
7-76
Choice c is compatible with the basic definition of learning curve.
13
d
7-81
Insurance is a typical overhead expense and overhead expenses are considered indirect costs.
14
d
7-51
EAC formula #2 is appropriate because you were told that current variances will not be indicative of future performance. So, EAC = AC + (BAC-EV) = 750,000 + (2,000,000-500,000) = $2,250,000.
15
a
7-80
The total cost of 20 units = Fixed Cost + Variable Cost = 2,500 + (100 x 20) = $4,500.
16
c
7-80
The cost of 10 additional units implies that production was already under way and you now want additional units. The fixed cost (nonrecurring, start-up cost) is not relevant. So, 10 additional units at $100 per unit will cost $1,000.
17
c
7-33
The data provide a spending variance, but not a real cost variance. You are missing EV; you have not measured how much work has been done (trick question).
18
b
7-70
Present value is thought of as the value today of a future cash flow.
19
a
7-82
Working capital is defined as current assets minus current liabilities.
20
b
7-68 7-71
NPV already takes into account the timing of the cash flows. The only relevance of project duration is that, of the two best projects, Project A finishes earlier and is thus preferred.
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Cost Management No. Answer
Slides
Note
21
b
7-21 7-35
Statement i is true: see slide 7-35, bullet #3. Statement ii is false: see slide 7-35, bullet #4 (reserve is not supposed to be used for scope changes). Statement iii is true: see slide 7-21. Management reserve is for “unknown unknowns”, events that are difficult or impossible to predict in advance.
22
c
7-79
The law of diminishing returns is associated with any situation in which putting more into something yields less return.
23
d
7-78
The description identifies three of the four classic steps of value analysis.
24
b
7-69
Statement i is false: a BCR greater than one indicates a profitable project. Statement ii is true: the slide uses that exact example. Statement iii is false: this statement is the classic definition of IRR (not BCR).
25
a
7-68
Choice a is the most correct statement. The problem with choice d (as stated) is that it could represent the situation in slide 7-68 where time period 1 shows the first profit, but the overall project is still operating at a loss. You should be looking for key words such as overall profit, net cumulative profit, and so on.
26
a
7-47 & 7-48
A CPI less than one indicates a cost overrun. An SPI less than one indicates that the project is behind schedule.
27
c
7-14 7-19
Bottom-up estimates are synonymous with definitive estimates. They require more effort but are much more accurate than order of magnitude estimates.
28
b
7-72
One description of IRR is that it represents the average rate of return on your investment.
29
c
7-47 7-50 7-55
Choices a and c may both be assessed by calculating the variance at completion. VAC = BAC - EAC (you are given BAC but must calculate EAC). EAC = BAC / CPI. Do the math and choice c is correct. You could quickly make a best guess: current status is cost overrun (you can see that easily and quickly from the data given to you). So look for choices that show the project finishing with an overrun. Again, choice c stands out.
30
d
7-48
In the reference manual, p. 1-7, the formula is given for %complete for total project: EV = .5 x 500k. Slide 7-48 gives SV = EV-PV = 250,000-300,000 = -$50,000 (behind schedule).
31
d
7-50
Choice a is EV. Choice b is AC. Choice c is ETC.
32
c
7-18
Choice c is the best answer (historical cost must also be adjusted; so choice a is not as complete or correct as choice c).
33
c
7-47
A CPI less than one is analogous to a negative variance. They both indicate bad news; you have a cost overrun.
34
b
7-14
The range given is -10 to +25% (budget estimate).
35
a
7-14
Order of magnitude estimates are for go/no-go decisions during initiating.
18
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Cost Management No. Answer
Slides
Note
36
a
7-47
CPI = EV / AC. So, .96 = EV / 50,000. EV = .96 x 50,000.
37
c
7-47 7-50
EAC = BAC / CPI. So, 312,500 = BAC / .96. BAC = .96 x 312,500.
38
b
Logic
EV is given as $126,000. (RTQ: Read The Question).
39
b
7-48
Choice a: The project did not start late. The display shows the SPI at 1.0 (on time) at the start of the project (left edge of the display). Choice b (insufficient resources) is a logical explanation for being behind schedule. Choice c explains the CPI but not the SPI. Choice d does not necessarily explain the SPI or the CPI.
40
b
7-29
See Tool #5, funding limit reconciliation.
41
a
7-56
TCPI calculates the CPI needed for a project to finish on budget. It divides the dollar value of the remaining work by the original budget still available.
42
b
7-48
Reference manual, p. 1-7, gives the formula for % spent as AC/BAC (75k/300k = 25%). Slide 7-48 gives SPI as EV/PV = 80k/86k = .93. Indexes below one are bad; you are behind schedule.
43
c
7-47 7-48
Indexes less than one are bad news: cost overrun and behind schedule.
44
a
7-48
SPI = EV/PV. PV is given as $500k. You must calculate EV, which is given as .50 x BAC = .50 x $1,000,000 = $500k. Therefore, SPI = 500,000/500,000 = 1.0. You are exactly on schedule.
45
d
7-68
Note the contrast in wording compared to question #25. This wording clearly states that cumulative revenues exceed cumulative costs and therefore the project is truly profitable.
46
d
7-75
ROI = (Revenue-Cost)/Cost = ($410k-$250k)/$250k = $160k/$250k = 0.64. As a percentage (multiply by 100), ROI is 64%. Any ROI above zero shows a profit.
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Practice Exam: Quality Management 1. Primary responsibility for quality on a project is vested in the ______. a. b. c. d.
lead engineer quality manager CEO project manager
2. Given the following information, where would a Pareto Chart suggest that corrective action be focused? Source of problem % of problems Design Fabrication Prototype Test Installation a. b. c. d.
78 08 06 04 04
Design Design and Fabrication Design, Fabrication, and Prototype All activities
3. Which quality management process audits quality requirements to ensure that appropriate quality standards are used and also provides an umbrella for continuous process improvement? a. b. c. d.
Plan Quality Management Conduct Quality Audits Perform Quality Assurance Control Quality
4. Your major information systems project is under pressure to finish as quickly as possible. Someone from the quality department wants to begin a quality audit of your project and your team objects. Which statement about quality audits is incorrect? a. b. c. d.
They may be scheduled or random. They assess whether the project is following its quality processes. They identify lessons learned that may improve performance on the project. They check the accuracy of the cost estimates submitted by the team.
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Quality Management
5. An assignable variance indicates that ______. a. b. c. d.
training is inadequate production equipment is worn out implementation of quality circles is paying off there may be an identifiable problem that must be investigated
6. When would sampling not be preferred over 100% inspection? a. b. c. d.
when destructive testing is required when you believe there are many defects when the cost of inspection is high when the population is large
7. Some companies today are using six sigma to set upper and lower control limits rather than the traditional ______ sigma. If your processes are engineered to a quality standard of six sigma, you will experience defects at a rate of approximately ______. a. b. c. d.
three; 3 defects per thousand items three; 3 defects per million items two; 5 defects per thousand items square root of “n”; 1 defect per ten thousand items
8. The primary responsibility for developing design specifications belongs to ______. a. b. c. d.
purchasing the project manager quality control engineering
9. Quality should generally be of ______. a. b. c. d.
lower priority than cost and schedule higher priority than cost and schedule equal priority with cost and schedule equal priority with schedule but higher priority than cost
10. Which is not a commonly used quality planning tool? a. b. c. d.
2
CSSR report (Cost and Schedule Status Report) Fishbone diagram Pareto chart Control chart
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Quality Management
11. A project manager notices that, while all the measurements on a control chart are within the control limits, several runs in the data show ten or more outcomes in a row below the midpoint (negative variance). The PM should ______. a. b. c. d.
take no action as long as all the variances remain within the control band apply the rule of seven assume there is a problem since negative variances have occurred report that the variances are most likely caused by random factors
12. Just-in-time (JIT) relies on the concept of reducing work-in-process inventory to ______. a. b. c. d.
zero stock half of previous stock a two day supply a one week supply
13. Plan quality management is ______. a. identifying which quality standards are relevant to the project and documenting how the project will demonstrate compliance b. monitoring specific project results to determine whether they comply with relevant quality standards and identifying ways to eliminate causes of unsatisfactory performance c. auditing quality requirements and results from quality control measurements to ensure appropriate quality standards and operational definitions are used d. the process of emphasizing prevention over inspection so as to reduce the total cost of quality 14. Control quality is ______. a. identifying which quality standards are relevant to the project and documenting how the project will demonstrate compliance b. monitoring and recording results of executing quality activities to assess performance and recommend necessary changes c. auditing quality requirements and results from quality control measurements to ensure appropriate quality standards and operational definitions are used d. the process of emphasizing prevention over inspection so as to reduce the total cost of quality 15. Quality management involves directing a team of people to achieve stated needs or goals by providing ______. a. b. c. d.
a project completed in the shortest possible time a product or service that conforms to the specification an award-winning product that brings public recognition to the project products meeting the highest standards of luxury goods
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Quality Management
16. According to current quality management thinking, which of the following approaches is least likely to produce quality improvements? a. b. c. d.
increased inspection employee suggestion programs quality circles statistical quality control
17. The concept of quality is based on ______. a. b. c. d.
meeting luxury goods standards producing excellent products that are superior to similar items conforming to the requirements / specifications maintaining uniformity of design
18. From a high-level perspective, quality ______. a. b. c. d.
is ensured by having inspectors cannot be quantitatively measured is inconsistent with productivity and meeting schedules is primarily a management problem (i.e., 80-90% of quality issues are the responsibility of management)
19. Reliability and maintainability are most affected by the ______ of a product or service. a. b. c. d.
design fabrication production testing
20. Which of the following is least likely to result in a project team with a strong commitment to quality? a. b. c. d.
clear goals cohesive team commitment to the project frequent turnover of personnel use of kick-off meetings
21. Benchmarking is best described as ______. a. b. c. d.
4
the measurement of customer satisfaction comparing planned product performance to the actual product performance a comparison of cost and quality comparing planned or current project practices with those of other projects
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Quality Management
22. As a tool of Plan Quality Management, what are three specific categories of costs associated with cost of quality? a. b. c. d.
prevention, appraisal, and failure planning, test, and rework prevention, inspection, and rework planning, appraisal, and failure
23. Quality attributes ______. a. are used to determine how effectively the performing organization supports the project b. can be objective or subjective in nature c. are numerically measurable on a continuous scale d. are best examined using flow charts 24. The quality tool that displays the sources of defects from the most occurrences (displayed on the left of the diagram) to the fewest occurrences (displayed on the right of the diagram) is called a ______. a. b. c. d.
control chart histogram checksheet Pareto chart
25. ISO 9000 is ______. a. b. c. d.
a process for preparing control charts a set of guidelines for quality an international standard that describes a recommended quality system only applicable to products manufactured in the United States
26. Kaizen is an approach that emphasizes ______. a. b. c. d.
quality circles cause and effect diagrams incremental improvement technological advances
27. The Kanban technique supports the ______. a. b. c. d.
use of Pareto diagrams use of control charts Just-In-Time inventory system variance analysis process
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Quality Management
28. The cost of quality includes the ______. a. b. c. d.
cost of inspection and rework cost of prevention and appraisal cost of system test and rework cost of conformance and nonconformance
29. The most likely result of an increase in quality is ______. a. b. c. d.
increased productivity decreased cost effectiveness increased technological advance increased amount of rework
30. Inspections are also referred to as ______. a. b. c. d.
sampling system tests status reports audits
31. “The optimal quality level is reached at the point where the incremental revenue equals the incremental cost” refers to what concept? a. b. c. d.
incremental analysis conformance analysis total quality analysis marginal analysis
32. During a meeting, the project team determines that the customer would benefit from a specific area of extra work and they add it to the project. This is called ______. a. b. c. d.
a change order gold-plating customer delight rapid prototyping
33. Although they are definitely related, quality assurance differs from quality control in several ways. Quality assurance is used during ______ and is focused on ______. a. executing and closing; providing confidence that future work will meet requirements b. planning and controlling; ensuring that actual results met requirements c. planning and executing; providing confidence that future work will meet requirements d. planning and closing; ensuring that actual results met requirements
6
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Quality Management
34. A quality standard of Plus/Minus three sigma would result in what approximate percentage of items that conform to requirements? a. b. c. d.
68.3% 95.5% 99.7% 99.9997%
35. Which of the following is an example of quality assurance? a. b. c. d.
quality audits control charts Pareto diagrams fishbone diagrams
36. Which of the following graphs contains a dependent as well as an independent variable? a. b. c. d.
Ishikawa diagram Scatter diagram Pareto diagram Control chart
37. You are using a control chart to track production of 60 watt light bulbs. The mean is 60 and the UCL/LCL are 64 watts and 56 watts respectively. Which set of outcomes shows a process under control? a. b. c. d.
61, 60, 58, 59, 60, 63, 65, 66, 64, 60 63, 65, 62, 59, 61, 64, 65, 66, 58, 61 61, 58, 59, 63, 65, 64, 66, 63, 59, 61 60, 59, 57, 62, 63, 61, 58, 59, 62, 58
38. The cost of quality (COQ) tracks costs of conformance in which of the following formal categories? a. b. c. d.
prevention, appraisal, and failure costs prevention and appraisal costs inspection and rework costs training and warranty costs
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Quality Management
39. You are reviewing a diagram that shows vertical bars. The tallest bar is on the left and identifies the number of defects caused by a specific problem. Other shorter bars also identify defects originating from specific causes. This diagram is called a ______ and may be used to ______. a. b. c. d.
Cause and Effect Diagram; determine the causes of a specific problem Cause and Effect Diagram; determine whether your process is under control Pareto Chart; determine whether your process is under control Pareto Chart; guide corrective action to the most productive areas
40. You are attempting to stimulate discussion to solve a persistent, recurring problem on your telecommunications project. Which of the following techniques is specifically designed for that purpose? a. b. c. d.
8
Ishikawa Diagram Pareto Chart Control Chart Run Chart
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Quality Management
Answer Sheet #1 Answer 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. 23. 24. 25.
Answer
Notes
26. 27. 28. 29. 30. 31. 32. 33. 34. 35. 36. 37. 38. 39. 40. 41. 42. 43. 44. 45. 46. 47. 48. 49. 50.
Percent Correct? Pass or Fail? # Misread ?s Other Notes:
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Quality Management
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Quality Management
Answer Key: Quality Management No. Answer
Slides
Note
1
d
8-37
Responsibility for the project is the PM and for a task is the employee doing the work.
2
a
8-16 8-19
See tool #3d, Pareto diagram/chart. The 80/20 rule is a guideline and not an absolute requirement. Even though it’s not quite 80%, there is a huge break in the data (from 78% down to 8% for fabrication).
3
c
8-31
Definitions are especially important in the quality chapter.
4
d
8-33
See tool #2, quality audits.
5
d
8-22
See tool #3f, control charts.
6
b
8-43
See tool #2, statistical sampling. Conditions under which sampling is preferred: large population, cost of inspection is high, destructive test is required, and you know the defect rate is low.
7
b
8-53
Know the distinction between 3 sigma and 6 sigma.
8
d
8-49
Engineers are the experts with the knowledge to develop design specifications.
9
c
8-49
Quality should share equal priority with cost and schedule.
10
a
8-10 8-13 to 8-26
11
b
8-23
See rule of seven.
12
a
8-50
Just-in-Time (JIT) works off of the idea of zero work-in-process safety stock.
13
a
8-9
See introduction to Plan Quality Management (definitions are especially important in this chapter).
14
b
8-38
See introduction to Control Quality.
15
b
8-3 to 8-5
See customer satisfaction (conformance to specifications is one of the possible definitions of quality management).
16
a
8-5 8-9
17
c
8-3 to 8-5
Quality is focused on the idea of meeting established requirements.
18
d
8-5 8-14
8-14: See the note below the table (one of Deming’s major points was the role of management in achieving quality).
19
a
8-49
Fits the notion of designing in quality on the front end.
20
c
8-51
Frequent turnover erodes the connection (or sense of responsibility) to the end result of someone’s work.
21
d
8-25
Benchmarking compares what you do to other approaches.
A CSSR report has nothing to do with quality (it’s a form of earned value reporting used by some government organizations).
8-5: See the bullet prevention over inspection. 8-9: Last bullet: Any suggestion that inspection is the best path to high quality is incorrect for purposes of the certification exam. A strong, historical PMI belief.
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Quality Management No. Answer
Slides
Note
22
a
8-13 8-14
See tool #2, cost of quality. Costs of conformance and nonconformance break into three additional categories: prevention, appraisal, and failure.
23
b
8-53
Attributes are simple quality characteristics: the result conforms or not. PMI says attributes may be objective or subjective.
24
d
8-16 8-19
See tool #3d, Pareto diagram (for the exam may also be called Pareto chart).
25
c
8-54
ISO 9000 is an international quality standard.
26
c
8-48
Kaizen is a Japanese concept meaning incremental improvement.
27
c
8-50
Kanban is a communication system that works in conjunction with the JIT inventory method.
28
d
8-13 8-14
Cost of quality includes costs of conformance and nonconformance. In addition, conformance breaks down into prevention and appraisal and nonconformance is also known as failure.
29
a
8-13
See tool #1, cost-benefit analysis. There are 4 benefits of meeting quality requirements.
30
d
8-44
See tool #3, inspection.
31
d
8-51
Marginal analysis defines optimal quality as the point at which incremental revenue equals incremental cost.
32
b
8-4
Gold-plating involves the project team unilaterally adding “extras” without using the change control process. PMI discourages this practice.
33
c
8-40
PMI says QA is used primarily during planning and executing to build confidence that future work will meet requirements. QC is used during executing and closing to ensure that actual outcomes met requirements.
34
c
8-53
A standard of three sigma means that 99.7% of outcomes meet requirements where a standard of six sigma means that 99.9997% of outcomes will meet requirements.
35
a
8-30 to 8-34
36
b
8-24
The independent variable is displayed on the horizontal (X) axis and represents the factor which may affect the dependent variable on the Y-axis.
37
d
8-20 to 8-23
Choices a, b, and c all have outcomes above the UCL (upper control limit). Choice d: The outcomes are all within the control limits.
38
b
8-13 8-14
Tricky question. The question mentioned only costs of conformance, not the overall cost of quality. Therefore, the correct answer is just prevention and appraisal and does not include failure.
39
d
8-16 8-19
A Pareto chart is a histogram (vertical bars). It often reveals that only a few issues are causing most of the defects (80:20 rule). Helps guide corrective action toward the most productive improvements.
14
Choices b, c, and d are associated with quality control (not quality assurance). Quality audits belong uniquely to QA.
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Quality Management No. Answer 40
a
Slides 8-18
Note The Ishikawa diagram is also called Cause-and-effect diagram or fishbone diagram. It is used as a group method to investigate root causes of specific problems.
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Practice Exam: Human Resource Management 1. According to McGregor’s Theory X, ______. a. b. c. d.
group consensus is the most effective route to management improvements quality circles are the most important factor in reducing the cost of quality poor working conditions are the most important reason for absenteeism workers are inherently unmotivated and need strong guidance
2. As an interpersonal skill, negotiation has been defined as ______. a. b. c. d.
the exchange of information to reach a decision the ability to get things done conferring with others to reach an agreement problem definition and timely decision making
3. The objectives of develop project team include the following except ______. a. b. c. d.
enhance project performance get the right people on the project team improve team members’ skills and abilities to complete project tasks improve trust and cohesiveness among team members
4. According to Abraham Maslow, human beings have a variety of potential needs. Maslow contended that the ______ need for a worker is ______, which means that _________. a. lowest-level; self-actualization; workers are motivated by a desire for personal growth and challenging work b. lowest-level; self-esteem; workers are motivated by respect and recognition c. highest-level; self-actualization; workers are motivated by a desire for personal growth and challenging work d. highest-level; self-esteem; workers are motivated by respect and recognition 5. “The tendency to rate high or low on all factors due to the impression of a high or low rating on some specific factor” is called ______. a. b. c. d.
relativity error halo error nepotism heteroscedasticity
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Human Resource Management
6. The planning tool used to show how human resources are allocated over time is called ______. a. b. c. d.
resource histogram responsibility matrix resource leveling strong matrix
7. At a recent luncheon, a question arose about fringe benefits and perquisites. The HR Director correctly pointed out that __________. a. they are essentially the same thing b. fringe benefits are standard items such as health insurance whereas perquisites are special awards such as access to the executive dining room c. a corner office is a fringe benefit whereas access to training is a perquisite d. an executive membership at a golf resort is a fringe benefit whereas a day off to participate in a company golf outing is a perquisite 8. You are collaborating with another company in the development of satellite technology to achieve easier and faster communication processes. Today you reached an impasse regarding a technical issue (one group favors round pegs and the other is adamantly committed to virtual pegs). While this disagreement is significant, many areas of common agreement exist. Which conflict resolution method might work best in this situation? a. b. c. d.
smoothing withdrawing compromising problem solving
9. Autocratic project managers ______. a. b. c. d.
often have abrasive personalities work closely with their team members make decisions without input from others usually have excellent management information systems
10. Which of the following is not part of problem solving as an interpersonal skill? a. b. c. d.
2
defining the problem identifying alternatives getting things done making a timely decision
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Human Resource Management
11. You are performing the work associated with acquiring the project team. If some of the staff that you need to complete the project are not available in house, which tool would you use to resolve the situation? a. b. c. d.
acquisition pre-assignment negotiation virtual teams
12. An important tool for identifying when people are allocated to tasks is called ______. a. b. c. d.
resource leveling responsibility matrix WBS resource Gantt chart
13. The resource management tool that focuses on “who is to do what” is called ______. a. b. c. d.
resource leveling fast tracking responsibility matrix PERT (Personnel Enhancement Reliability Tool)
14. Which of the following conflict management approaches is least likely to produce lasting results? a. b. c. d.
smoothing/accommodating withdrawing/avoiding confronting/problem solving compromising
15. Which of the following is an obstacle to team building in a matrix organizational structure? a. b. c. d.
Teams are too large. There are too many technical geeks on the teams. Large salary differences cause resentment. Team members are borrowed and can be hard to motivate.
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Human Resource Management
16. The kick-off meeting should ______. a. b. c. d.
identify team goals undertake detailed planning of tasks occur periodically during the life of the project always include the customer
17. A project manager can best create a sense of identity among team members by ______. a. b. c. d.
mandating the frequent use of e-mail reading the project mission statement at the start of all meetings getting and using a project war room implementing the use of name tags
18. You have been dismayed at recent behavior within your team. Sub-groups have formed (you are worried about cliques affecting long-term behavior) and seem to be competing to gain control of the project. There are so many differing ideas and such competition for specific jobs that you have become quite worried. What stage of the Tuckman model do you believe the team is experiencing? What would the next stage be? a. b. c. d.
forming; storming joining; performing storming; norming norming; performing
19. Legitimate power is also known as ________ authority. a. b. c. d.
reward (or purse string) bureaucratic technical formal
20. If both parties in a conflict employ forcing, the most likely result is ______. a. b. c. d.
stalemate compromise win-win a busy pizza delivery person
21. Which of the following statements about conflict is true? a. b. c. d.
4
conflict should be resolved by first separating the parties conflict should be avoided conflict is bad conflict can be positive
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Human Resource Management
22. Concurrent engineering involves ______. a. crashing the project schedule b. multi-functional teams and overlapping of project phases c. managing the work force by scheduling all design activities during the same timeframe d. eliminating the need for a separate production division 23. A responsibility matrix does not show ______. a. b. c. d.
who is doing what a list of project tasks functional resources the timing of specific tasks
24. “Employees who believe their efforts will lead to effective performance and who also believe they will be rewarded for their accomplishments will stay productive as long as the rewards meet their expectations”. This statement illustrates ______. a. b. c. d.
Theory Z expectancy theory requirements-rewards matrix hygiene factors
25. Education, medical benefits, insurance, and profit sharing are examples of ______. a. b. c. d.
overhead entitlements direct costs fringe benefits
26. Parking spaces, corner offices, and access to the executive dining room are examples of ______. a. b. c. d.
perquisites (“perks”) overhead self-actualization fringe benefits
27. As a rule, engineering staff are often responsive to ______. a. b. c. d.
referent authority formal authority technical authority purse string authority
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Human Resource Management
28. Which approach to resolving conflict is most likely to provide a lasting solution? a. b. c. d.
smoothing compromise forcing problem solving
29. One of your team members is fond of name dropping and, in particular, is constantly mentioning what the project sponsor wants the team to do. Which source of power is this team member using? a. b. c. d.
charisma formal expert referent
30. The hearing and resolution of a labor dispute by a neutral third party is called ______. a. b. c. d.
two-step collective bargaining force majeure arbitration bi-modal negotiation process
31. Managers who ascribe to McGregor’s Theory Y generally believe that employees ______. a. b. c. d.
dislike their work are inherently motivated and ambitious respond primarily to penalty power need perquisites as a form of motivation
32. You need to make an important decision quickly and you are reasonably confident that you already have the information needed to make a good decision. Which leadership style is appropriate? a. b. c. d.
6
autocratic democratic laissez-faire ready-fire-aim
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Human Resource Management
33. Which of the following is not a form of power derived from a project manager’s position? a. b. c. d.
penalty reward expert formal
34. What are the most common causes of conflict on a project? a. b. c. d.
schedules, project priorities, personalities schedules, project priorities, resources schedules, project priorities, cost schedules, personalities, project priorities
35. Which of the following is not a typical objective of a kick-off meeting? a. b. c. d.
identify and review project goals present the detailed project management plan achieve team commitment and buy-in introduce the key players
36. Dan D. Mann is the Director of Project Management Services for an explosives manufacturing conglomerate owned by Kennedy, Andersen, Burton, Oliver, Osteen, and Millwood (KABOOM, Inc.). Dan’s desk is positioned next to the main entrance to the office suite and he arrives early every morning. He observes when employees arrive, monitors how long they are gone at lunch, and frequently patrols the office area to prevent personal conversations and computer solitaire from hampering productivity. Dan believes he is a beloved boss but is, in fact, not well liked. As a boss, which of the following motivation theories does Dan seem to follow most closely? a. b. c. d.
Theory X Theory Y Hygiene factors Expectancy theory
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Human Resource Management
37. The design team is late in delivering their work to the test and evaluation team on a rather important and costly project. The project manager is aware of the problem but, in typical fashion, has done nothing. At breakfast this morning, Annika Valikangas (head of test and evaluation) reluctantly concluded that the project manager would probably not handle the problem. Realizing that she would have to handle the problem herself, which of the following actions should she take FIRST? a. b. c. d.
go directly to the project sponsor go to the project manager and the sponsor go to the manager of the design team and the PM go to the change control board
38. You are the lead negotiator for the government team in an endeavor to reach an agreement with a large company in Orlando, Florida. The company, Helicopter Universal Gyration Equippers (HUGE,) has a dozen representatives on their team from the areas of finance, engineering, production, procurement, and project management. You are trying to start an initiative to jointly fund improvements in manufacturing processes and then share the resulting cost savings. On the second morning of negotiations, the procurement representative from HUGE misunderstood a comment you made and has begun to act in a belligerent and insulting manner. Among other angry remarks, he questioned whether a fence post is smarter than you. You realize that he thinks you have questioned his integrity. Which of the following conflict resolution techniques might be most appropriate at this point? a. b. c. d.
problem solving compromise smoothing withdrawing
39. On the RACI chart shown below, which of the tasks is entered correctly? Task
Liisa
Lì
Saburo
Raymond
A
R
C
A
I
B
A
C
A
R
C
R
A
C
A
D
A
A
R
I
R = Responsible
a. b. c. d.
8
A = Accountable
C = Consult
I = Inform
Task A Task B Task C Task D
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Human Resource Management
40. As an experienced project manager, you personally believe that managing the human side of projects is crucial to your overall success. You are aware that the project management process for “manage project team” involves tracking team performance, providing feedback, and resolving issues. Which of the following is not a tool of manage project team? a. b. c. d.
observation and conversation performance appraisals conflict management ground rules
41. You were provided with a graph that was inadvertently unlabeled. The graph contains vertical bars. The vertical axis tracks how many hours are needed for specific resources and the horizontal axis contains time frames. You instruct your assistant to have the graph labeled as a ______ with the primary purpose of ______. a. responsibility assignment matrix; identifying time frames when team members will perform assigned tasks b. responsibility assignment matrix; identifying time frames when team members will attend training c. resource histogram; identifying time frames when team members are needed d. resource histogram; identifying time frames when training is needed 42. The graph identified in question 41 above is part of the ______ management plan. a. b. c. d.
training staffing acquisition teaming
43. Your dynamic but troublesome duo, team members Patricia Norman and Dawn Carlson, are at it again. At your last meeting of key project team members, they got into a loud but entertaining argument. Patricia vehemently contended that, above all, communication must be truthful. Dawn countered that tact is also an absolute requirement and stated that Patricia should try it some time. They are discussing which classic theory? a. b. c. d.
Blake and Mouton: Concern for Production vs. Concern for People Herzberg’s Hygiene Factors Myers-Briggs: Thinking vs. Feeling Maslow’s Hierarchy of Needs: Social vs. Self-Esteem
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Human Resource Management
44. While accomplishing human resource management activities, you find that you must build an effective team with people in multiple locations. Which tool should you use? a. b. c. d.
virtual team acquisition multi-criteria decision analysis pre-assignment
45. Earl is a high-performing engineer who does outstanding work. The only issue is that he needs to be recognized and appreciated for his efforts. Earl’s behavior is described by ______. a. b. c. d.
McGregor’s Theory Y Vroom’s Expectancy Theory Maslow’s Hierarchy of Needs for self-esteem Blake and Mouton’s Concern for People
46. You have several people on your team who seem to be very concerned about being liked and accepted by others. The problem is that they also tend to shy away from conflict instead of dealing with it. These people are motivated by _______. a. b. c. d.
10
Maslow’s social needs level in the hierarchy of needs Blake and Mouton’s theory on concern for people Vroom’s expectancy theory McClelland’s theory on need for affiliation
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Human Resource Management
Answer Sheet #1 Answer 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. 23. 24. 25.
Answer
Notes
26. 27. 28. 29. 30. 31. 32. 33. 34. 35. 36. 37. 38. 39. 40. 41. 42. 43. 44. 45. 46. 47. 48. 49. 50.
Percent Correct? Pass or Fail? # Misread ?s Other Notes:
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Human Resource Management
Answer Key: Human Resource Management No. Answer
Slides
Note
1
d
9-48
McGregor’s Theory X cautions that people are basically lazy and need strong guidance and controls to force them to work.
2
c
9-28
See tool #1, interpersonal skills. Know the definitions of all six terms (PLINCM).
3
b
9-26
Choice b (get the right people on the team) is associated with acquiring the team, not developing the team.
4
c
9-47
In Maslow’s Hierarchy of Needs, the highest level need is selfactualization.
5
b
9-59
Halo error is rating someone consistently high or low based on preconceived notions.
6
a
9-14 9-15
A resource histogram, also called a resource loading chart, depicts how many resources are needed during each time period. The chart is part of the staffing management plan.
7
b
9-60
Fringe benefits are standard items available to all employees and perquisites are special awards available only to selected people.
8
a
9-41
Smoothing builds on areas of agreement while steering around difficult issues that threaten an agreement. The downside of smoothing is always that the real problem may re-emerge later and the deal will fall through anyway. “Temporary solution”
9
c
9-54
See leadership styles: Autocratic leaders make decisions without input from others.
10
c
9-28
Choice c, getting things done, is part of influencing (not problem solving).
11
a
9-20
See tool #3, acquisition. Used when resources are not available inhouse.
12
d
9-57
Resource Gantt chart shows who is doing which task at what time.
13
c
9-12
See tool #1, organization charts and position descriptions. A responsibility matrix shows who is to do what, but does not address timing.
14
a
9-41
Smoothing fails to address the difficult issues and almost always results in a temporary solution. Compromise could result in failure to support an agreement in the long term (according to Thomas and Kilmann) and is a possible answer. However, historically PMI has thought of smoothing as temporary.
15
d
RM
See RM (reference manual), p. 2-6, disadvantages of the matrix.
16
a
9-58
Kick-off meetings do not usually involve detailed planning. They occur at the end of planning to announce the start of project execution (i.e., do not occur periodically). Some organizations hold an internal kick-off meeting that does not include the customer to get the project team “on the same page” before any discussions are held in the presence of the customer.
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Human Resource Management No. Answer
Slides
Note
17
c
9-31
In developing the team, colocation is a major advantage. If colocation is not possible, a war room is highly recommended and is believed to create a better sense of identity with the project.
18
c
9-29 9-30
Be familiar with the stages of the Tuckman model.
19
d
9-46
Legitimate or formal power/authority is the power that comes with a particular job title. For many project managers, formal power is limited.
20
a
9-42
Problems associated with the forcing technique include: making enemies and stalemate.
21
d
9-39
Be familiar with the potential positive and negative effects of conflict. Conflict may produce the analysis and discussion necessary to solve an important problem.
22
b
9-59
Concurrent engineering overlaps work and uses a multi-disciplinary team from the early stages of a project.
23
d
9-12 9-57
A responsibility matrix shows who does what but does not address timing.
24
b
9-50
Expectancy theory states that people are likely to be motivated and productive if there is feasible and they expect to be rewarded for a successful outcome.
25
d
9-60
Know the examples of fringe benefits, which are standard items available to all employees.
26
a
9-60
Know the examples of “perks”, which are special awards available only to certain people.
27
c
9-46
Many engineers have difficulty with project managers who lack technical understanding.
28
d
9-40
Problem solving is used when the issues are important to both parties and the solution is likely to last because the end result is a “win” for both parties.
29
d
9-46
Referent power is using the power of “name dropping”, borrowing someone else’s power.
30
c
9-60
Arbitration uses a neutral third party to hear and resolve disputes.
31
b
9-48
Theory Y asserts that employees are naturally motivated and want to do good work.
32
a
9-54
See leadership styles, autocratic. Making decisions without input is considered safe if you have all the relevant information.
33
c
9-46
Also see RM, p. 9-18, power and authority, bullet #2. Expert power is attained through education and experience.
34
b
9-39
See sources of conflict. Remember the acronym SPoRT (schedules, priorities, resources, technical issues).
35
b
9-58
See objectives of a kick-off meeting, which do not include detailed planning.
16
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Human Resource Management No. Answer
Slides
Note
36
a
9-48
See McGregor’s Theory X.
37
c
9-40
Do not immediately escalate as the first response to a problem. Handle conflict in a direct, collaborative manner.
38
d
9-42
Withdrawing is recommended when someone has become angry, belligerent, and/or insulting. Withdraw, calm down, re-engage in discussions.
39
a
9-12
To avoid confusion, a RACI chart should show only one person accountable for a given task.
40
d
9-35 9-38 to 9-43
Ground rules is associated with developing the team, not managing the team.
41
c
9-15 & 16
A resource histogram identifies time frames when resources are needed.
42
b
9-14 & 15
The staffing management plan includes the resource histogram under the heading “resource calendar”.
43
c
9-53
See Myers-Briggs Type Indicator®. The question focuses on the thinking vs. feeling dimension. “Thinkers” believe that it is far more important to be truthful than tactful. “Feelers” believe that tact is also an essential part of human interaction.
44
a
9-21
One advantage of virtual teaming is the ability to accomplish a project with resources in multiple locations (domestic or international).
45
c
9-47
In Maslow’s Hierarchy of Needs, self-esteem is the second highest level of need. It involves people needing recognition and appreciation for the value they add to their work. McClelland’s Need for Achievement is similar but was not a choice in this particular question.
46
d
9-51
In McClelland’s Theory on Need for Affiliation describes people who need to be liked and accepted. They support other team members quite well but they don’t like to deal with conflict.
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Practice Exam: Communication Management 1. Surveys have shown that project managers typically spend as much as __________ percent of their time communicating and acquiring information. a. b. c. d.
50 67 75 90
2. Which of the following is not a typical communication barrier? a. b. c. d.
lack of clear communication channels personal antagonisms cultural differences a democratic leadership style
3. The project manager’s formal communications are best handled ______. a. b. c. d.
in writing verbally, face to face through personal contacts according to established reporting procedures
4. A project team is experiencing problems with personal issues. This situation would be best handled through __________ communication. a. b. c. d.
formal, written formal, oral informal, written informal, oral
5. When the project objectives include meeting an external, competitive challenge, the project team tends to ______. a. b. c. d.
lose cohesiveness gain cohesiveness enter the storming phase of the Tuckman team development model enter the norming phase of the Tuckman team development model
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Communication Management
6. Which of the following would be least likely to improve project communications? a. b. c. d.
Define policies that force people to communicate. Use available information distribution systems appropriately. Improve the communications skills of the project management team. Identify and deal with conflict.
7. Active listening involves paraphrasing what someone says to you. It is often used to ______. a. b. c. d.
interrupt the speaker if you disagree with him or her check to see if you understand the speaker let the speaker know that you are really listening gain credibility with the rest of the audience
8. Effective listening includes all but which of the following ______. a. b. c. d.
watching the speaker to pick up physical gestures and facial expressions limiting the amount of eye contact providing feedback, e.g., paraphrasing the speaker’s message considering what you want to say before responding
9. As projects grow larger, the amount of documentation and communication will ______. a. b. c. d.
grow at a linear rate grow at greater than a linear rate decrease at a linear rate decrease at greater than a linear rate
10. You have a total of 12 team members during the executing phase of your work. Five were just removed and a new stakeholder has just raised an important issue. How many communication channels are you dealing with at this point? a. b. c. d.
28 13 12 8
11. Customer acceptance of major project deliverables should be confirmed by ______. a. b. c. d.
2
written documentation verbal communication formal, written documentation formal, verbal communication
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Communication Management
12. Four months ago, you were assigned the honor of project manager for the redesign of information technology systems at Texas A&M University in the metropolis of College Station. You began the project with a team of five people and, despite the occasional tension caused by personality conflicts, good progress has been made. You just received approval to continue to the second phase of the project and now have five additional team members (you are now a group of ten). How many additional communication channels do you have to maintain? a. 5 b. 10 c. 35 d. 45 13. Project managers would be involved the least in ______. a. b. c. d.
making oral presentations understanding the details of shareholder reporting explaining technical issues communicating with the customer
14. Project progress reports are ______. a. b. c. d.
descriptions of what the team has accomplished required on a weekly basis for almost all projects primarily used to predict future project outcomes of use primarily to the project sponsor
15. Barriers to effective communication include cultural differences, differing time zones, technical language, and uncooperative attitudes. The existence of communication barriers is likely to produce ______. a. b. c. d.
timely project decisions higher levels of trust and cooperation higher levels of conflict enhanced project performance
16. Which of the following statements about Plan Communications Management is true? a. b. c. d.
A primary tool is the information distribution system. A primary tool is communication requirements analysis. A major output is project records. An input is the communications management plan.
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Communication Management
17. Which statement about information is true? a. b. c. d.
Work performance data is an output to Control Communications. Work performance reports is an output to Manage Communications. Effective communication means providing only the information that is needed. Effective communication means providing information in the right format at the right time to the right audience.
18. The primary reason for variance analysis and reporting performance is to ______. a. b. c. d.
protect the team from second guessing by other stakeholders reduce the required frequency and duration of status review meetings identify variances and take corrective action keep the project management plan up to date
19. Project status review meetings should do all of the following except ______. a. b. c. d.
have a clearly defined purpose follow a published agenda be planned for a defined duration be held on a weekly basis
20. Which of the following is true when controlling communications? a. Work performance reports is an input and information management systems is a tool. b. Work performance reports is an output and information management systems is a tool. c. Work performance data is an input and work performance information is an output. d. Work performance data is an output and work performance information is an input. 21. Which of the following is a tool of plan communications management? a. b. c. d.
communications management plan information management systems communication technology communication strategy
22. You have just completed a performance report and your assistant asked who should get a copy. Your guidance is ________. a. b. c. d.
4
key stakeholders follow the communications management plan follow the project management plan all project stakeholders
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Communication Management
23. Communication is improved when the sender __________ the receiver. a. b. c. d.
sends an email so there is a written record for actively listens to emotes as much as shows concern for the perspective of
24. What is a tight matrix? a. ensuring that team members never work more than two projects at a time b. physically collocating the team in a single area c. an environment where the balance of power is shifted in favor of functional managers d. an environment where the balance of power is shifted in favor of the project manager 25. Using both formal and informal project communication is likely to enhance ______. a. b. c. d.
keeping the boss informed project integration project teams that do not have access to electronic mail creating a healthy level of conflict
26. Which of the following is an input to Manage Communications? a. b. c. d.
work performance reports performance reporting expert judgment project communications
27. The chairperson of a meeting should ______. a. b. c. d.
discourage participation hold meetings on holidays to raise productivity hold meetings every day to increase communication and awareness help the group decide how to handle differences of opinion
28. Which PMI recommendation for more effective communication helps teams have a better sense of identity? a. b. c. d.
Make meetings effective. Use a tight matrix. Get a project war room. Hold weekly social gatherings.
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Communication Management
29. If the project is experiencing increasing levels of conflict due to poor communication, which of the following is most likely to improve the situation? a. b. c. d.
encouraging the team to socialize outside of work scheduling project status meetings early in the morning installing the latest version of an automated scheduling tool scheduling an off-site team building workshop
30. A benefit of documenting and disseminating the project management plan is to ______. a. b. c. d.
reduce uncertainty in project execution communicate with the project stakeholders improve cost controls evaluate other technical solutions
31. Your global project has 7 team members in the USA, 8 team members in Europe, and 10 communication channels in Asia. How many total people are involved? a. b. c. d.
59 28 25 20
32. Project meetings are generally more effective when they ______. a. b. c. d.
leave the agenda flexible exclude troublesome people who always identify problems have an explicitly defined purpose require that attendees stand throughout the entire meeting
33. The PMBOK® Guide describes three methods for sharing information. These methods include ______, ______, and ______. Communication methods is a ______ of Plan Communications Management and Manage Communications. a. b. c. d.
6
interactive, push, pull; input interactive, push, pull; tool meetings, technology, reports; input meetings, technology, reports; tool
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Communication Management
Answer Sheet #1 Answer 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. 23. 24. 25.
Answer
Notes
26. 27. 28. 29. 30. 31. 32. 33. 34. 35. 36. 37. 38. 39. 40. 41. 42. 43. 44. 45. 46. 47. 48. 49. 50.
Percent Correct? Pass or Fail? # Misread ?s Other Notes:
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Communication Management
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Communication Management
Answer Key: Communication Management No.
Answer
Slides
Note
1
d
10-16
See special note: project managers spend up to 90% of their time communicating and handling information.
2
d
10-38
See barriers to communication. Reverse the question: Finding the three things that ARE barriers is usually easier.
3
a
10-17
Formal communication is best handled in writing. For example, if a formal presentation is delivered, you should have a hard copy in your files to prove what was said at a later date.
4
d
10-44
Many people are reluctant to handle personal conflict in writing and are slow to make such interactions formal (until absolutely necessary).
5
b
None
PMI historical question and logic. When challenged by outsiders, most groups bond together in response.
6
a
None
Another PMI historical question based on logic with no specific reference. Try reversing the question: Which statements would most likely improve communication. Also, PMI does not generally favor the use of “bad” words such as penalizing or forcing.
7
b
10-4 10-17
See receiver responsibilities, active listening.
8
b
10-18
Effective listening guidelines include maintaining eye contact.
9
b
10-12
See tool #1, communication requirements analysis. As project teams grow larger, the number of communication channels increases at greater than a linear rate.
10
a
10-12 to 10-14
You started with 12 people, lost 5, and gained 1. Therefore, you are now operating with 8 people. Using the formula for communication channels: (N x (N-1))/2 = (8 x 7)/2 = 28 channels.
11
c
10-44
Important, official information should usually be handled through formal, written documentation.
12
c
10-13
You must know how to calculate communication channels and you must note the key word “additional” in the last sentence of the question. With 5 people, there are 10 communication channels: [n (n-1)] / 2 = (5x4)/2. With 10 people, there are 45 channels: (10x9)/2. Therefore, there are 35 additional channels when the team grows from 5 to 10 people.
13
b
10-27 10-44
PM not responsible for stock prices or reporting to shareholders (some people misread that word as “stakeholders”).
14
a
10-27
See tool #5, performance reporting. Three major types of reports are identified by PMI.
15
c
10-38
See barriers to communication. PMI says the presence of these barriers will make conflict more likely.
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Communication Management No.
Answer
Slides
16
b
10-12 to 10-19
See tool #1, communications requirements analysis.
17
d
10-9
Choices a and b: Are inputs, not outputs. Choice c: States the definition of efficient communication, not effective communication.
18
c
10-27
See tool #5, performance reporting. As stated in numerous places in the PMBOK® Guide, analyzing variances is aimed at identifying the need for corrective or preventive action.
19
d
10-40
See action #6, effective team communication. It is not a universal guideline that meetings should be held on a weekly basis (they may be weekly or not).
20
c
10-31 10-33 10-35
Choices a and b: work performance reports is an input to manage communications. Choice d: backwards (choice c is correct).
21
c
10-10 10-15
Choice a: an output, not a tool. Choice b: part of manage (not plan) communication. Choice d: No such formal PMI terminology (but doesn’t it sound logical?).
22
b
4-18
Also see reference manual, p. 4-6. PMI has indicated that official documents (e.g. project management plan and others) are distributed according to the communications management plan. Planning communications is centered around the information needs of key stakeholders.
23
d
10-39
See effective team communication: Be an effective communicator.
24
b
10-40
See effective team communication: Use a tight matrix.
25
b
10-39
See effective team communication: Be a communication expeditor.
26
a
10-25
Choice b: a tool, not an input. Choice c: part of manage (not plan) communication. Choice d: an output, not input.
27
d
10-41
See roles of a meeting chairperson.
28
c
10-40
See effective team communication: Get a project war room.
29
d
9-29
See tool #3, team-building activities. Team-building is a PMI historical theme. Also, there has always been some overlap in exam content between HR, communication, and stakeholder management.
30
a
10-42
Developing the project management plan involves analysis which reduces uncertainty and distribution of the plan keeps people informed.
31
d
10-14
Determine the number of stakeholders involved.
32
c
10-40
Effective meetings have: Purpose, agenda, logistics, and minutes.
33
b
10-19 10-26
PMI identifies three methods for sharing information: interactive, push, and pull. These choices are classified as a tool called Communication Methods and it’s a tool for two processes: Plan Communications Management and Manage Communications.
12
Note
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Practice Exam: Risk Management 1. Identifying, analyzing, and responding to risk factors throughout the life of a project is risk ______. a. b. c. d.
mitigation response planning management identification
2. As a subset of response planning, deflection includes all of the following except ______. a. b. c. d.
transferring risk to another party by outsourcing (subcontract) performing reserve analysis purchasing insurance against specific losses purchase of a warranty
3. Which of the following scheduling techniques explicitly incorporates risk assessment? a. b. c. d.
PERT Activity-on-Arrow diagrams CPM Gantt chart
4. Which statement best describes risk reassessment? It is ______. a. an output of control risks that regularly checks for new risks and monitors previously identified risks b. an output of plan risk responses that assesses the likely effect of change requests on project risk exposure c. a tool of plan risk responses that compares remaining reserves to remaining risk d. a tool of control risks that regularly checks for new risks and monitors previously identified risks 5. Which of the following factors does not characterize risk? a. b. c. d.
The risk portfolio The risk event The risk probability The amount at stake
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Risk Management
6. “A lack of information that makes it difficult to estimate the likelihood of an event” describes which of the following concepts? a. b. c. d.
risk aversion dating uncertainty amount at stake
7. The most important time for project risk assessment is ______. a. as soon as the project cost and schedule baselines have been established b. as soon as a problem surfaces c. during the planning phase d. during the close-out phase 8. Projects that require new technology are inherently high risk because ______. a. there is a larger base of similar projects to provide historical results b. performing personnel probably have considerable experience with the new technology c. of the additional uncertainty in the design activity d. the customer has a full understanding of the actual requirements 9. The Delphi method uses ________. a. b. c. d.
expert opinion and group creativity techniques expert opinion and consensus linear regression lessons learned
10. Which risk response strategy applies to both positive and negative risks? a. b. c. d.
accept mitigate enhance insure
11. Which tool would help you assess the potential impact of highly uncertain variables on the rest of the project? a. b. c. d.
2
Decision Tree Tornado Diagram Probability and Impact Matrix Path Convergence
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Risk Management
12. The ______ is useful in risk analysis because it permits a structured evaluation of the work. a. b. c. d.
WBS network diagram project charter design specification
13. If the probabilities for events A and B are 50% and 60% respectively and the events are independent, what is the likelihood that both events will occur? a. b. c. d.
30% 55% 60% 110%
14. After a risk assessment has identified, prioritized, and planned responses for the project’s concerns, risk management is then ______. a. b. c. d.
concerned with changes in the risk factors during the project concerned primarily with lessons learned after the project is finished readdressed only if the customer becomes concerned complete
15. Schedule risk can be most accurately assessed by ______. a. b. c. d.
identifying the critical path employing the PERT methodology treating it as a function of technical risk a simulation that captures the effects of both duration estimate distributions and path convergence
16. If an identified risk event has a 20% chance of happening in any given month, and if the project is expected to last 5 months, the probability that this risk event will not occur during the third month of the project is ______. a. b. c. d.
20% 40% 60% 80%
17. Including a cost reserve in the project budget is intended to ______. a. b. c. d.
reduce the probability of scope changes increase the probability of scope changes reduce the probability of a cost overrun increase the probability of a cost overrun
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Risk Management
18. Risk analysis is most effective if it is organized according to the project’s ______. a. b. c. d.
work breakdown structure resource breakdown structure strategic plan baseline schedule
19. Which of the following diagramming techniques provides the best insight into the risk event interdependencies of a project? a. b. c. d.
Influence diagrams Decision trees Precedence diagrams Affinity diagrams
20. The results of Monte Carlo simulation will be most affected by your choice of ______. a. b. c. d.
computer program statistical distribution work breakdown structure network diagramming technique
21. A tool of perform quantitative risk analysis is ______. a. b. c. d.
risk register risk data quality assessment risk urgency assessment simulation
22. If a project has a 60% chance of a $100,000 profit and a 40% chance of a $100,000 loss, the expected monetary value for the project is a ______. a. b. c. d.
4
$100,000 profit $ 60,000 profit $ 20,000 profit $ 40,000 loss
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Risk Management
23. Given the following information, what is the expected value of this risk event? Probability .5 .2 .2 .1 a. b. c. d.
Result - 10,000 - 7,000 - 5,000 - 2,000
- 24,000 - 10,000 - 7,600 insufficient information to answer the question
24. Which of the following is not a concern of risk management? a. b. c. d.
adverse consequences legal issues arising from project activities pursuing the opportunities presented by taking risks verifying correctness of the work
25. Response planning is the process of formulating suitable management strategies to deal with identified risk events. Which of the following is not associated with response planning? a. b. c. d.
mitigation contracting contingent strategies modeling and simulation
26. Which of the following estimates involve the least risk? a. b. c. d.
30 days plus or minus 5 days 25 to 30 days optimistic = 26 days, most likely = 30 days, pessimistic = 33 days 25 days give or take 4 days
27. Your team has been tracking approximately a dozen risks and you have accomplished about 2/3 of the tasks identified in the WBS. A team member suggested that one of the risks was no longer very likely and should be closed. Two weeks later, the closed risk actually did occur. ______, which is a tool of ______ should have been used to track this situation. a. b. c. d.
Risk audits; control risks Risk audits; plan risk responses Risk reassessment; control risks Risk reassessment; plan risk responses
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Risk Management
28. The process of determining what risk events may affect a project is called risk ______. a. b. c. d.
quantification identification deflection mitigation
29. Which one of the risk management processes may not be performed on every project? a. b. c. d.
monitor and control risks plan risk management perform quantitative risk analysis perform qualitative risk analysis
30. Developing alternative activity sequences (i.e. “workarounds”) is an example of ______. a. b. c. d.
identify risks perform quantitative risk analysis contingency planning control risks
31. Which of the following is not a likely result of risk management? a. b. c. d.
the project management plan is changed the communication plan is modified contract terms & conditions are modified or added the project charter is changed
32. Purchasing insurance is an example of ______. a. b. c. d.
risk identification risk transfer (deflection) risk acceptance risk avoidance
33. The customer requests a change to the project that would increase your risk. What would you do first? a. b. c. d.
6
analyze the impact of the change with the project team change the risk management plan talk to the customer about the impact of the change analyze the expected monetary value of the risk
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Risk Management
34. A contingency plan is devised at the time a potential risk event is identified. This plan is used later if the risk event actually occurs. By comparison, a __________ is devised after a risk event already occurred and is used as part of which process? a. b. c. d.
reassessment; analyze risks reassessment; plan risk responses workaround; plan risk responses workaround; control risks
35. Risks should be identified during which phase of the project management life cycle? a. b. c. d.
all phases initiation planning executing
36. Which of the following is a tool of Identify Risks? a. b. c. d.
SWOT Analysis Risk Categorization Analytical Techniques Risk Data Quality Assessment
37. You are prioritizing the potential damage from several risk events. Which risk event represents the greatest threat to the project? Risk Event A B C D a. b. c. d.
Probability 80% 20% 50% 70%
Amount of Loss $100,000 $320,000 $220,000 $180,000
A B C D
38. An appropriate sequence for risk management activities is ______. a. b. c. d.
identification, analysis, and response planning planning, assessment, and control factor identification, management, and elimination identification, deflection, and mitigation
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Risk Management
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Risk Management
Answer Sheet #1 Answer 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. 23. 24. 25.
Answer
Notes
26. 27. 28. 29. 30. 31. 32. 33. 34. 35. 36. 37. 38. 39. 40. 41. 42. 43. 44. 45. 46. 47. 48. 49. 50.
Percent Correct? Pass or Fail? # Misread ?s Other Notes:
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Risk Management
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Risk Management
Answer Key: Risk Management No. Answer
Slides
Note
1
c
11-3
PMI defines risk management in a very simple way: Identifying, analyzing, and responding to project risks.
2
b
11-52
See tool #1, strategies for negative risks. Transferring risk has also been called deflecting risk. It involves insurance, warranties, outsourcing, and the use of fixed price contracts.
3
a
6-80 11-37
PERT explicitly incorporates the idea of variation or range into the estimating by using optimistic, most likely, and pessimistic estimates. Wider ranges in the data indicate more uncertainty in the work being performed.
4
d
11-59
See tool #1, risk reassessment. Reassessment considers new risks, the effectiveness of risk responses, and whether to retire outdated risks.
5
a
11-4
PMI defines risk factors as the event that might happen, the probability, and the amount at stake.
6
c
11-4
The technical definition of uncertainty is lacking the information needed to assign a probability to an event.
7
c
Logic
Five of the six risk processes are associated with planning. PMI states that risk assessment is iterative but it is primarily a planning function.
8
c
11-25
See input #2, scope baseline. New technology tends to be naturally high risk.
9
b
11-19
See tool #2, information-gathering techniques. The Delphi method involves experts seeking consensus about specific questions.
10
a
11-52
The “accept” response may be used for a low risk (handle it later if the risk actually occurs) or for a low opportunity (an unexciting opportunity compared to other choices).
11
b
11-37
See tool #2, quantitative analysis and modeling. Tornado diagrams explore the impact of uncertain variables on project outcomes.
12
a
11-17
See input #6, scope baseline. The scope baseline includes the WBS, which allows a way to consider the risk in each work package.
13
a
11-65
The probability of two independent events happening is the product of the probabilities for each event (multiply the two probabilities).
14
a
11-56
Controlling risks is fundamentally about watching for any changes in the project (a new risk emerges, an identified risk event actually occurs, and so on).
15
d
11-38 11-46 11-48
See tool #2, quantitative analysis and modeling techniques. Simulations involve more effort, analysis, and expense but they usually yield the most rigorous, detailed, and accurate information.
16
d
11-65
The probability of the event not happening is 80% (1-Probability Event Happens). Each month is an independent trial.
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Risk Management No. Answer
Slides
17
c
7-35 11-33
The use of reserve is intended to reduce the chance of cost and schedule overruns.
18
a
5-45 11-17
See input #6, scope baseline. PMI has always believed that one of the most valuable techniques for any project is the WBS. The WBS would help relate the risk to the right part of the work and, by extension, the expected timing of the risk.
19
b
11-45
Decision trees evaluate multiple possible risk events and how they might interact.
20
b
11-38
See key points about simulation: The results of any simulation are significantly affected by the statistical distribution that is applied to the analysis.
21
d
11-38
A simulation is part of tool #2, quantitative analysis and modeling techniques.
22
c
11-39 to 11-41
(.60 x 100,000) + (.40 x -100,000) = 60,000-40,000 = +$20,000
23
c
11-39 to 11-41
Each outcome should be multiplied by its probability. Then, all resulting outcomes should added. (.5 x -10,000) + (.2 x -7,000) + (.2 x -5,000) + (.1 x -2,000) = (-5,000) + (-1,400) + ( -1,000) + (-200) = -7,600.
24
d
All
Choice d is associated with validate scope (correctness of the work). It is not about risk. Choices a, b, and c are examples of various aspects of risk management.
25
d
11-38
Choice d (modeling and simulation) is associated with quantitative analysis (not response planning).
26
b
11-66
Least risk equals most narrow range.
27
c
11-59
Risk reassessment identifies new risks, evaluates the effectiveness of response plans, and determines whether specific risks should be closed.
28
b
11-14
Risk identification creates a list of risk events that might affect the project.
29
c
11-31
Quantitative risk analysis is more time consuming and expensive than other methods and may not be needed.
30
d
11-61
See output #2, change requests. Know the difference between contingency plans and workarounds.
31
d
11-61 11-62
Among the outputs, notice that the lists for updates to the project management plan and project documents never mention the project charter. Modifying various plans, contract terms, and baselines is likely. Also, updates to the risk register are mentioned consistently; however, changing the charter is unlikely.
32
b
11-52
See tool #1, strategies for negative risks.
14
Note
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Risk Management No. Answer
Slides
Note
33
a
4-27
The first response is always to follow integrated change control procedures.
34
d
11-61
See output #2, change requests. Workarounds are devised after a risk has already occurred. Contingency plans are developed before the risk occurs.
35
a
11-14
Risk identification is an on-going, periodic activity. New risks could emerge at any time.
36
a
11-21
SWOT (Strengths, Weaknesses, Opportunities, Threats) evaluates both negative and positive aspects of a project.
37
d
11-40
You must calculate the EMV for each risk event by multiplying the probability by the estimated loss in dollars. Risk D has the largest EMV.
38
a
11-7
Choice a is the correct sequence: Identify, analyze, plan responses. The other choices uses names that are incorrect.
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15
Practice Exam: Procurement Management 1. A make-or-buy analysis should consider ______. a. b. c. d.
design to cost modeling value engineering producibility direct and indirect costs
2. Which tools are used to evaluate prospective contractors? a. b. c. d.
written and oral proposals weighting and screening systems performance reports contract change control system
3. Which of the following contract types poses the highest cost risk for the buyer? a. b. c. d.
cost plus fixed fee cost plus incentive fee fixed price incentive fee firm fixed price
4. Which of the following contract types poses the highest cost risk for the contractor? a. b. c. d.
cost plus fixed fee cost plus incentive fee fixed price incentive fee firm fixed price
5. Which factor would least influence the type of contract to be used? a. b. c. d.
how well defined the scope is the buyer’s willingness to make changes after the project has started the amount of risk in completing the work and in estimating costs accurately whether a lessons learned process will be used
6. Incentive clauses in a contract are designed to ______. a. b. c. d.
reduce risk for the contractor by shifting it to the buyer reduce risk for the buyer by shifting it to the contractor bring the contractor’s objectives in line with those of the buyer achieve the lowest possible cost
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Procurement Management
7. One of your major contractors, ABC Electronics, just made a complaint that a member of your team had visited one of ABC’s subcontractors without permission. Your team member may have violated the concept of _________. a. b. c. d.
undefined work liquidated damages single source privity of contract
8. Which statement about the statement of work is inaccurate? The SOW is ______. a. b. c. d.
a description of a product or service to be procured also known as a statement of requirements in some application areas a description of collateral services such as performance reporting used to expand the pool of potential sellers
9. Which of the following statements regarding change control is correct? a. A fixed price contract will minimize the need for change control. b. Contracts should include procedures to accommodate changes. c . A Design Review Committee (DRC) is responsible for reviewing change requests. d. Detailed specifications will eliminate the most common causes of change. 10. Which statement about type of contract is correct? a. Cost Plus Fixed Fee contracts are illegal in many jurisdictions. b. A fixed price contract shifts most of the risk to the buyer. c. Firm Fixed Price (Lump sum) contracts offer sellers the greatest profit potential. d . Cost reimbursable contracts offer sellers the highest profit potential. 11. In which type of contract is it most essential for the contractor to control any changes in scope? a. b. c. d.
fixed price cost plus incentive fee cost plus fixed fee cost plus percentage of costs
12. A make-or-buy analysis is usually conducted as part of ______. a. b. c. d.
2
plan procurement management conduct procurements control procurements close procurements
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Procurement Management
13. Which of the following statements about contract negotiations is most correct? a. Every negotiation has a winner and a loser. b. Successful negotiations preserve working relationships by satisfying the needs of both parties. c. Determine your bottom-line but don’t reveal it to the other side. d. Define your objectives in advance and stick with them. 14. Once signed, a contract is legally binding unless ______. a. b. c. d.
it violates public law the consideration is deemed inequitable one party is unable to finance their part of the work one party changes their mind and declares the agreement void
15. Control procurements should ______. a. b. c. d.
be performed by contract attorneys manage the interfaces among the various providers on larger projects be the primary responsibility of the project manager utilize tools such as independent estimates and screening systems
16. A contract for undefined work ______. a. b. c. d.
is usually priced at the time of award is legally reserved for small and disadvantaged firms should only be awarded to firms with a reputation for honesty is illegal and should never be used
17. With respect to monitoring and surveillance of contractor performance, buyers should ______. a. conduct surveillance only on technically complicated projects b. conduct minimal surveillance so the contractor can stay on schedule c. conduct extremely close surveillance so that contractors cannot take advantage d. conduct sufficient surveillance to ensure the work is being performed properly 18. Which of the following is not an advantage of decentralized contracting? a. b. c. d.
The contracting staff will be more familiar with specific project needs. The cost of the contracting function will be reduced. The project manager will have more control. A decentralized approach is more flexible and adaptable.
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Procurement Management
19. Post-contract evaluations are important because ______. a. b. c. d.
fees may be tied to contractor performance most contracts require them they help establish a historical database for future contractor selection they are mandatory in many cases
20. A buyer decides they want to expand the project scope and change from a cost reimbursable to a fixed price contract. The contractors may ______. a. complete the original work; reject the additional work b. negotiate a fixed price contract that includes both the additional work and the remaining work c. complete the original work on a cost reimbursable basis; negotiate a contract for the additional work d. follow any of the strategies cited above 21. A contract is awarded with a clearly specified statement of work. The contractor completes the work as specified, but the buyer is not pleased with the results. Under normal circumstances, the contract is considered to be ______. a. b. c. d.
incomplete because the buyer is not pleased incomplete because the specifications were incorrect complete because the contractor is satisfied complete because the contractor met the terms and conditions of the contract
22. You are developing and testing a new product. The potential for this technology to work successfully has been evaluated through lab research and it looks promising. You want to enter into a development contract that has financial incentives for the contractor to keep costs under control. However, the potential contractors are adamant that there should be a guaranteed minimum fee because of the risk involved. You should enter into a ______ contract. a. b. c. d.
CPIF (Cost Plus Incentive Fee) CPMF (Cost Plus Minimum Fee) CPFF (Cost Plus Fixed Fee) CPAF (Cost Plus Award Fee)
23. A contract is ______. a. b. c. d.
4
a legal relationship subject to remedy in the courts legally enforceable only if it is written generally not needed for readily available goods and services a legal document used to describe project products & services
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Procurement Management
24. Contractor selection without competition makes sense when ______. a. b. c. d.
there is no schedule pressure other mechanisms exist to ensure that contractor prices are reasonable no particular contractor has unique qualifications the target marketplace is an oligopoly
25. Contract incentives aimed at improving cost or schedule performance ______. a. b. c. d.
are usually not cost effective in the real world are not needed for well managed projects have an excellent track record in improving performance are only advantageous for buyers
26. Which of the following is not a criterion typically used to evaluate prospective contractors? a. b. c. d.
technical capability management approach cost type of procurement document
27. Which of the following statements about procurement are true? i. Standard contract clauses are more costly to develop. ii. A unilateral contract may be originated using an RFP. iii. Sellers are paid a preset amount per unit of service in time and material contracts. a. b. c. d.
i ii iii i, ii, and iii
28. You are purchasing 150 laptop computers for the engineering school at Imperial College, London, UK. You are attempting to compare various factors such as delivery schedule, price, and technical specifications. Which procurement document would be most appropriate for this situation a. b. c. d.
IFB RFI RFP RFQ
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Procurement Management
29. You have been tasked to recommend the appropriate type of contract for a major development project in the field of cryo-telekinesis. The work involves a newly emerging technology and the company has no prior experience. Several colleagues have agreed that the work is highly uncertain and estimating schedules and required budgets is expected to be difficult. Last night, you went into the attic and retrieved information from your graduate studies at IMD (International Institute for Management Development, Lausanne, Switzerland). You now recall that the most appropriate type of contract in this situation is ______. a. b. c. d.
fixed price time and material oral agreement with award fee cost reimbursable
30. The primary purpose of contract negotiations is to ______. a. b. c. d.
avoid competitive bidding reach an acceptable agreement between the buyer and seller ensure the buyer receives the lowest price ensure the seller receives the highest price
31. Bidder conferences are part of ______. a. b. c. d.
plan procurement management conduct procurements control procurements close procurements
32. Which of the following must be present to have a binding contract? a. b. c. d.
a platter of shrimp and two attorneys the business addresses of the primary parties acceptance signatures of authorized agents
33. Stating that you have to catch an airplane in one hour represents what negotiating tactic? a. b. c. d.
6
good guy, bad guy deadline missing man fait accompli
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Procurement Management
34. A screening system establishes requirements that must, at a minimum, be met by the contractor. These systems are usually applied during the _______ phase of the procurement process. a. b. c. d.
plan procurement management negotiation control procurements conduct procurements
35. A Request for Proposal (RFP) is prepared during which step of the procurement process? a. b. c. d.
make-or-buy analysis plan procurement management conduct procurements develop source selection criteria
36. An RFP is used to ______. a. solicit bids from contractors when the work is a complex development for a relatively high monetary amount b. solicit bids from contractors when conducting a best value search for existing commodity items in the marketplace c. solicit bids from contractors when you are looking for the best price for routine items readily available in the marketplace d. solicit expressions of interest from contractors 37. Which of the following is a narrative description of products and/or services to be supplied under contract? a. b. c. d.
the chart of accounts the specification the statement of work the project management plan
38. Which of the following provides a precise description of a physical item, service, or result for the purpose of purchase and/or implementation of an item or service? a. b. c. d.
a statement of work a specification a WBS dictionary an RFP
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Procurement Management
39. A buyer is most likely to award a cost plus incentive fee contract under which of the following conditions ______. a. b. c. d.
scope is not well defined and there is significant cost risk scope is not well defined and there is very little cost risk scope is well defined and there is significant cost risk scope is well defined and there is very little cost risk
40. You are the project manager for a major renovation of a Las Vegas hotel called the Kat’s Meow. After two weeks of grueling one hour per day negotiating sessions, you have agreed on the following contract terms: the contract will be a fixed price incentive fee (FPIF), the target cost will be $120 million, the target profit will be $30 million, the share ratio will be .80/.20, and the ceiling price will be $190 million. You know that there is a point at which the contract incentive stops and all additional costs come entirely from the contractor’s profit. This concept is known as the point of total assumption (PTA). What is the PTA for this contract? a. b. c. d.
$150 million $170 million $190 million PTA does not apply to an FPIF contract
41. If the final, actual cost of the Kat’s Meow project from question #40 was $100 million, what contract price would the customer pay? Assume that no changes were made to the agreement described above. a. b. c. d.
$120 million $130 million $134 million There is insufficient information to calculate the result
42. If the final, actual cost of the Kat’s Meow project from question #40 was $140 million, what contract price would the customer pay and what would the seller’s profit be? Assume that no changes were made to the agreement described above. a. b. c. d.
8
$150 million, $30 million $166 million, $26 million $170 million, $30 million There is insufficient information to calculate the result
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Procurement Management
43. You are developing a technology that will be the first true virtual video program in the world. Customers can have experiences as world class athletes, famous explorers, or take the “dream” vacation of a life time. The project is still hush-hush and is known to those working on it as the Imaginator Project. You are operating under a CPIF (cost plus incentive fee) contract with the following terms: target cost is $90 million, target profit is $30 million, the share ratio is .50/.50, the maximum fee is $40 million, and the minimum fee is $20 million. If the final cost is $96 million, what price will the customer pay? a. b. c. d.
$ 96 million $110 million $120 million $123 million
44. You are entering into a multi-year technical development program and have already been warned about potential price increases for certain supplies and materials. These potential price increases represent uncertainties over the time span envisioned and are, unfortunately, beyond your control. You should consider which type of contract? a. b. c. d.
Fixed Price with Economic Price Adjustment Fixed Price Incentive Fee Cost Plus Award Fee Time and Material
45. The project cost estimates are of greatest interest to the contractor’s project manager when performing __________ contracts. a. b. c. d.
cost plus fixed fee cost plus incentive fee fixed price incentive firm fixed price
46. Changing a contract’s scope is usually easier with a ______. a. b. c. d.
letter agreement joint venture fixed price contract cost plus contract
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Procurement Management
47. Negotiating the ceiling price of a cost reimbursable contract to a lower figure ______. a. b. c. d.
is generally advisable because it saves money does not ensure delivery of the required product for the negotiated price will ensure buyer satisfaction because the contract scope can be changed should never be done in a competitive environment
48. As a buyer, a primary objective of a contract negotiation is ______. a. b. c. d.
10
obtaining products and services of the highest possible grade obtaining the lowest possible price ensuring that the contract is done on a fixed price basis obtaining a fair and reasonable price
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Procurement Management
Answer Sheet #1 Answer 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. 23. 24. 25.
Answer
Notes
26. 27. 28. 29. 30. 31. 32. 33. 34. 35. 36. 37. 38. 39. 40. 41. 42. 43. 44. 45. 46. 47. 48. 49. 50.
Percent Correct? Pass or Fail? # Misread ?s Other Notes:
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Procurement Management
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Procurement Management
Answer Key: Procurement Management No.
Answer
Slides
Note
1
d
12-31
See tool #1, make-or-buy analysis. Indirect costs include the cost of managing a contractor (monitoring, evaluating status reports, site visits, and so on).
2
b
12-39
See introduction to Conduct Procurements. Screening systems help narrow proposals down to the most competitive ones. Also, note that weighted evaluation scores are used to establish a preferred negotiating sequence for the best proposals (“short list”).
3
a
12-15 12-26
Cost reimbursement contracts place most of the risk on the buyer whereas fixed price contracts place most of the risk on the seller/contractor.
4
d
12-15 12-26
Cost reimbursement contracts place most of the risk on the buyer whereas fixed price contracts place most of the risk on the seller/contractor.
5
d
12-16
The use of a lessons learned process would easily be the factor of least interest in choosing the type of contract. See course slide #1216 with respect to choices a and c. Choice b: If a buyer is known to firmly resist changes, a contractor would be at even more risk than usual if they signed a fixed price (especially firm fixed price) contract.
6
c
12-30
Contract incentives are designed to align the objectives of both parties, create a win-win zone.
7
d
12-65
Under the rules of privity of contract, you may not interfere with someone else’s contractor.
8
d
12-33 12-44
Choice d is about advertising, not the SOW.
9
b
12-52
A basic logic question. Choice a: Change control is especially important with fixed price agreements. Unlike cost reimbursement, if costs change in a fixed price contract, the contractor might not be reimbursed.
10
c
12-13 to 12-26
Choice a: CPFF is legal; CPPC is illegal in the federal sector. Choice b: fixed price shifts risk to the seller, not the buyer. Choice c: correct, see bullet #3, slide #12-25. Choice d: incorrect, highest profit potential is with fixed price rather than cost reimbursable contracts.
11
a
12:25
Logic: costs are covered in cost reimbursement but not in fixed price. So, scope changes must be handled more carefully by a seller under a fixed price contract.
12
a
12-8 12-31
See tool #1, make-or-buy analysis.
13
b
12-44
See tool #7, procurement negotiations. This is a PMI historical belief (negotiations should strive to satisfy the needs of both parties).
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Procurement Management No.
Answer
Slides
Note
14
a
12-46
There are four characteristics required for a contract to be legally enforceable. One of them is that the agreement must not violate any laws.
15
b
12-48
At this point in a procurement, the contract has been awarded and the work must actually be managed. One of the management issues is the possibility of multiple providers.
16
c
12-67
See the definition of undefined work in the reference manual on p. 12-20. Starting work without agreed terms and conditions requires a certain amount of trust.
17
d
12-48
Logic. PMI states that buyers and sellers both perform the amount of monitoring and surveillance necessary to ensure that each party meets its obligations.
18
b
12-64
If contracting is decentralized, costs will probably increase because it will take more people to fully staff each individual project.
19
c
12-60
See output #2, bullet #3. Post contract evaluations create a past performance database for use in selecting contractors for future work.
20
d
No ref
A basic logic question.
21
d
No ref
PMI has asked several basic logic questions about contracts.
22
a
12-15 12-16 12-19
CPIF is the appropriate arrangement. The clues are: the project is a risky developmental effort, the contractor feels a need for incentives and wants a guaranteed minimum fee. The only contract with that exact set of factors is CPIF.
23
a
12-2 12-46
See output #2. An agreement, also called a contract, is a legal relationship subject to remedy in the courts and is binding to both parties.
24
b
12-62
In the absence of competition, one concern is whether you have a way to ensure that prices are fair and reasonable.
25
c
12-30
Ample real world evidence shows that contract incentives really work.
26
d
12-35
Cost, management approach, and technical capability are classic criteria for evaluating prospective contractors.
27
c
12-67 12-33 12-13
Statement i: Standard clauses are less costly (p. 12-20 in the reference manual), Statement ii: Unilateral contracts are initiated using purchase orders (slide 12-33), Statement iii: Time & materials contracts establish a preset amount of money for each unit of service (slide 12-13).
28
d
12-34
You are looking for an item generally available in the marketplace and you wish to get the best value by considering multiple criteria (schedule, price, and technical). RFQ is the appropriate document.
29
d
12-16
Examining the factors influencing the type of contract shows that cost reimbursement is appropriate when the work is uncertain (emerging technology) and cost estimates are difficult.
16
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Procurement Management No.
Answer
Slides
Note
30
b
12-44
See tool #7, objectives of negotiating a contract (fair and reasonable price; develop/preserve a good working relationship by achieving a win-win outcome).
31
b
12-43
See tool #1, bidder conferences.
32
c
12-46
See output #2: For a contract to be binding, there must be an offer and acceptance.
33
b
12-45
See common negotiation tactics.
34
d
12-43
See tool #2, proposal evaluation techniques. Screening systems help narrow the proposals to the most promising ones (referred to as the short list).
35
b
12-34
An RFP is developed as part of Plan Procurement Management.
36
a
12-33 12-34
An RFP is used for complex, nonstandard development involving relatively high monetary amounts.
37
c
12-33
Classic definition of the SOW.
38
b
12-67
See p. 12-20 in the reference manual for the definition of a specification. Also, see PMBOK® Guide glossary, p. 563.
39
a
12-16 12-19
See factors influencing the type of contract. Cost reimbursement is appropriate when risk is high and the scope is hard to define.
40
b
12-21 12-22
PTA = [(Ceiling price-Target price)/Buyer share] + Target cost = [(190-150)/.80] + 120 = (40/.80) + 120 = $170 mil. Note: Target price is 150 mil (not 120 mil).
41
c
12-21 to 12-23
This type of question is worked most easily as a series of 3 steps: 1. Calculate fee adjustment = (Target cost-Actual cost) x Seller share = (120-100) x .20 = +$4 mil. 2. Calculate actual fee = Target fee + Fee adjustment = 30 + 4 = $34 mil. 3. Calculate contract price = Actual cost + Actual Fee = 100 + 34 = $134 mil.
42
b
12-21 to 12-23
Same 3 steps: 1. Fee adjustment = (120-140) x .20 = -$4 mil. 2. Actual fee = 30-4 = $26 mil. 3. Price = 140 + 26 = $166 mil. Step 2 calculated the seller’s profit at $26 mil.
43
d
12-19 12-20
Price = Cost + Fee. Cost given as 96 mil. Fee adjust = (TC - AC) x SSR = (90-96) x .50 = -3 mil. So, fee is 30 - 3 = 27. Price = 96 + 27 = $123 mil.
44
a
12-28
Fixed Price with Economic Price Adjustment contracts protect buyers and sellers from external conditions beyond their control, e.g., price increases for supplies and materials over an extended time frame.
45
d
12-25 12-26
In a firm fixed price agreement, there is no share ratio. Every dollar spent by the contractor comes 100% from their potential profit.
46
d
12-15 12-16
With cost reimbursement contracts, all valid costs are reimbursed and some level of profit is guaranteed. Therefore, contractors have less risk that an unexpected aspect of a change will penalize them financially.
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17
Procurement Management No.
Answer
Slides
Note
47
b
12-15
The contractor is not required to deliver a final product in a cost reimbursement contract (only required to deliver “best effort”). If you set the ceiling price too low, you could possibly ensure that the contractor cannot finish the work within the available budget. You would then spend the entire ceiling price and not get a finished result.
48
d
12-44
PMI identifies two primary objectives for a contract negotiation. One of them is to obtain a fair and reasonable price. This is actually the objective for both parties, buyer and seller.
18
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Practice Exam: Stakeholder Management 1. Stakeholder management is usually the responsibility of the ________ and the most effective means for communicating with stakeholders is _________. a. b. c. d.
project sponsor; electronic mail project sponsor; face-to-face meetings project manager; electronic mail project manager; face-to-face meetings
2. Which of the following statements about identifying stakeholders is the most correct? a. b. c. d.
Identifying stakeholders usually occurs as part of planning. A power/interest grid may be of use during stakeholder analysis. All stakeholders should be treated in a fair and equal manner. The stakeholder register is an input to the process.
3. Which of the following is a tool of identify stakeholders? a. b. c. d.
stakeholder analysis stakeholder register stakeholder management strategy analytical techniques
4. Which of the following is an input to control stakeholder engagement? a. b. c. d.
issue log organizational process assets updates interpersonal tools change requests
5. An output of manage stakeholder engagement is ______. a. b. c. d.
project management plan updates change log stakeholder management plan interpersonal tools
6. The actions associated with Identify Stakeholders are associated with which process group? a. b. c. d.
Identifying Initiating Planning Controlling
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Stakeholder Management
7. Which process group aligns stakeholders’ expectations with the purpose of the project and which stakeholder process belongs to that group? a. b. c. d.
Planning; Identify Stakeholders Planning; Plan Stakeholder Management Initiating; Identify Stakeholders Initiating; Plan Stakeholder Management
8. With respect to the role of stakeholders, the planning process is aimed primarily at ______. a. b. c. d.
effectively managing stakeholders’ expectations gaining stakeholder buy-in controlling changes and recommending corrective actions obtaining acceptance by the customer or sponsor
9. With respect to the role of stakeholders, the executing process is aimed primarily at ______. a. b. c. d.
effectively managing stakeholders’ expectations gaining stakeholder buy-in controlling changes and recommending corrective actions obtaining acceptance by the customer or sponsor
10. Which of the following is the least likely to be an advantage of involving stakeholders during project initiation? a. b. c. d.
Create a shared understanding of project success criteria. Improve deliverable acceptance. Improve stakeholder satisfaction. Improve the change control process.
11. Which of the following statements about stakeholders is most true? a. The primary concern of the project team should be external, negative stakeholders. b. Stakeholder identification is only of concern during initiating. c. It is primarily the responsibility of the stakeholder to make him or herself known to the project team. d. Overlooking negative stakeholder interests can increase the likelihood of failure.
2
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Stakeholder Management
12. Which statement about stakeholders is incorrect? a. b. c. d.
On some projects, the customer provides the functions of a sponsor. Stakeholder requirements must be incorporated into the project plan. The most important stakeholders are usually internal to your organization. Stakeholder identification is a continuous process.
13. Which statement about customers and users is not true? a. Customers are the persons or organizations who will use the product, service, or result. b. If stakeholder expectations come into conflict, the resolution should generally favor the customer. c. Users are the persons or organizations who will use the product, service, or result. d. Customers are the persons or organizations who will approve and manage the product, service, or result. 14. Your team has identified a stakeholder who has very high power within your organization but a fairly low interest in the details of your project. This stakeholder should be ______. a. b. c. d.
managed very closely monitored but not managed extensively managed sufficiently to keep him or her satisfied managed sufficiently to keep him or her informed
15. Which of the following is not an input to Identify Stakeholders? a. b. c. d.
enterprise environmental factors procurement documents project charter stakeholder analysis
16. Which of the following is an output of Identify Stakeholders? a. b. c. d.
stakeholder identification stakeholder register stakeholder communications stakeholder analysis
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Stakeholder Management
17. Which of the following is not one of the important activities associated with Plan Stakeholder Management? a. Create and maintain relationships between the project team and other stakeholders. b. Manage and improve communications. c. Review the level of stakeholder engagement. d. Classify stakeholders as positive or negative. 18. Identify Stakeholders is part of ______ and Manage Stakeholder Engagement is part of ______. a. b. c. d.
initiating; planning initiating; executing planning; executing planning; controlling
19. Which of the following is an input to Plan Stakeholder Management? a. b. c. d.
Meetings Analytical techniques Project charter Stakeholder register
20. Which of the following is not a level of engagement for stakeholders? a. b. c. d.
Uninformed Unaware Neutral Leading
21. Stakeholder influence is at its greatest potential ______. a. b. c. d.
4
at the time project baselines are being formed early in the project life cycle during execution of the project management plan whenever changes are requested
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Stakeholder Management
22. Which of the following are recommended interpersonal skills when managing stakeholder engagements? a. b. c. d.
Negotiating agreements and facilitating consensus Active listening and negotiating agreements Building trust and resolving conflict Resolving conflict and facilitating consensus
23. The outputs to Manage Stakeholder Engagement include ______. a. b. c. d.
change logs and OPA updates project documents updates and work performance information issue logs and change requests change requests and communication methods
24. Control Stakeholder Engagement includes ______. a. identifying and classifying stakeholders b. the use of face-to-face meetings as a preferred communication method for handling stakeholder issues c. devising a stakeholder management plan d. monitoring stakeholder relationships and adjusting strategies as necessary 25. Stakeholder management can potentially have an effect on any project management process the team or other stakeholders might perform. Which listed process has a direct, formal connection to stakeholder management? a. b. c. d.
Collect requirements Create WBS Estimate activity durations Control quality
26. Which statement about the initiating process group is true? a. Develop Project Charter occurs before Identify Stakeholders. b. Identify Stakeholders occurs before Develop Project Charter. c. The project sponsor is most important to project success in the latter stages of the project. d. The initiating process group monitors the status of work packages.
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Stakeholder Management
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Stakeholder Management
Answer Sheet #1 Answer 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. 23. 24. 25.
Answer
Notes
26. 27. 28. 29. 30. 31. 32. 33. 34. 35. 36. 37. 38. 39. 40. 41. 42. 43. 44. 45. 46. 47. 48. 49. 50.
Percent Correct? Pass or Fail? # Misread ?s Other Notes:
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Stakeholder Management
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PMC:DJ4:EN:000 ver.3.0 | © 2015 CMF Solutions and TwentyEighty Strategy Execution. All Rights Reserved.
Stakeholder Management
Answer Key: Stakeholder Management No. Answer
Slides
Note
1
d
13-23 13-27
PMI has always recommended that the PM must personally handle (and not delegate) certain sensitive, important tasks. Managing stakeholders is one of those important items. Also, when dealing with important stakeholders, face-to-face meetings are preferred.
2
b
13-12 13-13
See tool #1, stakeholder analysis, step 2: Analyze impact and use a classification model. Choice a: identifying stakeholders is part of initiating. Choice c: the importance of various stakeholders must be prioritized (they are all not of equal importance). Choice d: is an output, not an input.
3
a
13-10 13-12
Choice b is an output. Choices c and d are associated with plan stakeholder management, not identify stakeholders.
4
a
13-32 13-33
Choices b and d are outputs, not inputs. Choice c is a tool of manage stakeholder engagement, not control the engagement.
5
a
13-24 13-29
Choices b and c are inputs, not outputs. Choice d is a tool.
6
b
13-8
Identify stakeholders is one of two initiating processes (Develop project charter is the other). Also see reference manual p. 3-7.
7
c
13-8
See PMBOK® Guide, p. 54. A major goal of initiating is to align stakeholders’ expectations with the purpose and goals of the project. Identify stakeholders is an initiating process.
8
b
13-16
See PMBOK® Guide, p. 55. Stakeholder buy-in is one of the goals of the planning process. While buy-in is always of interest, the primary work on making it happen is in planning.
9
a
13-23
See PMBOK® Guide, p. 56. Executing is aimed at the on-going management of expectations.
10
d
13-9
See PMBOK® Guide, p. 55. Initiating is aimed more at overall project vision, buy-in, and setting the stage for satisfied stakeholders. It is not aimed at reviewing and improving management procedures such as change control.
11
d
13-6
See PMBOK® Guide, pp. 30-33. Also mentioned in the introduction to the risk chapter, failure to consider negative stakeholders may increase the chances of project failure.
12
c
13-6 13-15
See PMBOK® Guide, pp. 30-33. Important stakeholders may be internal or external, positive or negative, and performing or advising.
13
a
13-5
See PMBOK® Guide, pp. 30-33. Customers approve and manage the product, service, or result; users are the persons or organizations who will use the product, service, or result.
14
c
13-13
See the Power/Interest Grid. High power but low interest are managed by “keeping them satisfied.”
15
d
13-10 13-11
Stakeholder analysis is a tool, not an input.
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Stakeholder Management No. Answer
Slides
16
b
13-10 13-15
The stakeholder register is the only output for Identify Stakeholders.
17
d
13-12 13-16
Choice d (Classifying stakeholders) is part of Identify Stakeholders. Choices a, b, and c are all part of Plan Stakeholder Management.
18
b
13-8
The 4 stakeholder processes cover initiating, planning, executing, and controlling, respectively.
19
d
13-17
The charter is an input to Identify Stakeholders (not planning); choices a & b are tools, not inputs.
20
a
13-20 13-21
See tool #3, analytical techniques. Also see reference manual p. 13-5.
21
b
13-23
See the introduction to Manage Stakeholder Engagement. This point is emphasized in several places in the body of knowledge. Stakeholders have the greatest influence over outcomes early in the project life cycle.
22
c
13-27
See tool #2, interpersonal skills. Choices a, b, and d each contain management skills, tool 3, different skills than those in tool 2.
23
c
13-24 13-29 13-30
Choice a: the change log is an input, not an output. Choice b: work performance information is an output for a different process (control stakeholder engagement). Choice d: communication methods is a tool, not an output.
24
d
13-31
Choice d is correct: Control stakeholder engagement involves monitoring relationships and adjusting strategies. Choice a: Is part of identify stakeholders. Choice b: Is tool #1 for manage stakeholder engagements. Choice c: Is output #1 for plan stakeholder management.
25
a
5-13 5-14
The stakeholder register is an input to collect requirements. There is no such formal connection to the other 3 processes.
26
a
4-9 13-10 13-20
The project charter is an input to Identify Stakeholders. Conversely, the stakeholder register is not an input to Develop Project Charter. The influence of project sponsors tends to be most important earlier in the project.
12
Note
PMC:DJ4:EN:000 ver.3.0 | © 2015 CMF Solutions and TwentyEighty Strategy Execution. All Rights Reserved.
Comprehensive Exam #1 1. Which of the following is least likely to lead to a scope change? a. b. c. d.
customers who change their minds about project deliverables a change in government regulations a desire to incorporate a newly emerged technology into the project bottom-up cost estimating
2. Configuration management is ______. a. b. c. d.
monitoring and controlling emerging project scope against the scope baseline the production of a scope statement the creation of the work breakdown structure the set of procedures developed to ensure that project design criteria are met
3. Recently, many of your team members were clashing over how to proceed and challenging each other for control of certain tasks. You are now noticing that most team members are beginning to trust each other and are sharing information. The team has moved into which stage of team development on the Tuckman ladder? a. b. c. d.
performing storming forming norming
4. A key rule for achieving customer satisfaction is ______. a. b. c. d.
do not spare expenses in product/service development conduct a needs analysis always do what the customer suggests conduct a life cycle cost analysis
5. Which of the following are the most common categories of project reports? a. b. c. d.
status, progress, and forecast profitability, status, and exception status, variance, and stock price progress, status, and trend
6. Which of the following statements is correct? a. b. c. d.
The project manager should be assigned no later than the start of planning. The project manager should be assigned when the WBS is finalized. The project charter is often updated as a result of change requests. Validate scope is a planning process.
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Comprehensive Exam 1
7. Your team has been tracking approximately a dozen risks and you have accomplished about 2/3 of the tasks identified in the WBS. A team member suggested that one of the risks was no longer very likely and should be closed. Two weeks later, the closed risk actually did occur. ______, which is a tool of ______ should have been used to track this situation. a. b. c. d.
Risk audits; control risks Risk audits; plan risk responses Risk reassessment; control risks Risk reassessment; plan risk responses
8. Most projects begin in response to a business need or market demand, but are not usually formally initiated until completion of ______. a. b. c. d.
a project management plan goals and objectives a make-or-buy analysis a project charter
9. You are searching for more effective ways to do management presentations of schedule status on complex projects with large numbers of interdependent work packages. Increased use of ______ would be an effective way to display summary results to upper management. a. b. c. d.
arrow diagrams hammock activities critical chain diagrams precedence diagrams
10. A work package is ______. a. b. c. d.
a required level of reporting a daily work sheet (list of tasks for that day) a deliverable found at the lowest level of the WBS an activity that can be assigned to more than one organizational unit
11. Which of the following contract types offers the maximum profit potential to the contractor? a. b. c. d.
2
cost plus fixed fee cost plus incentive fee fixed price incentive firm fixed price
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Comprehensive Exam 1
12. What is the business case and when is it created? a. a description of the business need and cost-benefit analysis; a tool of Develop Project Charter b. a description of the business need and cost-benefit analysis; an input to Develop Project Charter c. a description of products and services to be delivered; a tool of Develop Project Management Plan d. a description of products and services to be delivered; an input to Develop Project Management Plan 13. A cost account is ______. a. also called a code of accounts and provides a numbering system for all work packages b. also called a code of accounts and is a management control point that contains one or more work packages c. also called a control account and is the lowest level at which organizational responsibility is assigned d. also called a control account and provides a numbering system for all work packages 14. You are reviewing the latest earned value data and note that the CPI is 0.83 and the SPI is 1.13. Your project ______. a. b. c. d.
has a cost underrun and is behind schedule has a cost underrun and is ahead of schedule has a cost overrun and is behind schedule has a cost overrun and is ahead of schedule
15. You just changed companies and your new manager has asked you to develop a project management methodology. You were instrumental in developing such a methodology in your previous company and you happen to have an unofficial copy. You should ______. a. b. c. d.
tell your manager that you cannot participate because of your previous work use the unofficial copy as the basis for the requested methodology consult your new manager about whether it is okay to use your unofficial copy use your knowledge and experience to create the methodology
16. If the level of quality conformance increases as a result of new processes or changed methods, the required cost of monitoring is likely to ______. a. b. c. d.
decrease increase decrease initially, then increase slightly increase, then tend to level off
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Comprehensive Exam 1
17. Quality Function Deployment is used to ______. a. b. c. d.
enhance the just-in-time inventory procedure improve product distribution systems provide better product definition provide a benchmarking process for quality improvements
18. You have just noticed that most of your process outputs are trending below the centerline of your control chart. You should ______. a. b. c. d.
apply the Rule of 7 extend the lower control limit as necessary create and analyze a Pareto diagram use a Scatter diagram to determine the greatest cause of defects
19. A fundamental tenet of modern quality management holds that quality is most likely to be achieved by ______. a. b. c. d.
planning it into the project developing careful mechanisms to inspect for quality developing prestigious products and processes implementing effective quality circle meetings
20. The cost of quality (COQ) tracks costs of conformance in which of the following formal categories? a. b. c. d.
prevention, appraisal, and failure costs prevention and appraisal costs inspection and rework costs training and warranty costs
21. A common human resource management implication of fast tracking is ______. a. b. c. d.
job enrichment demotivation need for increased coordination among the work force need for increased pay
22. A key component of MBO is that ______. a. b. c. d.
4
management and workers identify objectives jointly the subjective component of creating objectives can be included customers are involved in the evaluation process objectives are reviewed quarterly
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Comprehensive Exam 1
23. You have several people on your team who seem to be very concerned about being liked and accepted by others. The problem is that they also tend to shy away from conflict instead of dealing with it. These people are motivated by _______. a. b. c. d.
Maslow’s social needs level in the hierarchy of needs Blake and Mouton’s theory on concern for people Vroom’s expectancy theory McClelland’s theory on need for affiliation
24. Output per person-hour of input describes ______. a. b. c. d.
economies of scale value marginal product productivity the learning curve
25. You are reviewing a diagram that shows vertical bars. The tallest bar is on the left and identifies the number of defects caused by a specific problem. Other shorter bars also identify defects originating from specific causes. This diagram is called a ______ and may be used to ______. a. b. c. d.
Cause and Effect Diagram; determine the causes of a specific problem Cause and Effect Diagram; determine whether your process is under control Pareto Chart; determine whether your process is under control Pareto Chart; guide corrective action to the most productive areas
26. Project managers would be involved the least in ______. a. b. c. d.
making oral presentations understanding the details of shareholder reporting explaining technical issues communicating with the customer
27. Extensive use of __________ is most likely to aid in solving complex problems. a. b. c. d.
verbal communications written communications project management software a management information system
28. Which of the following is a tool of Collect Requirements? a. b. c. d.
Benchmarking Stakeholder register Expert judgment Requirements documentation
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Comprehensive Exam 1
29. Project meetings are generally more effective when they ______. a. b. c. d.
leave the agenda flexible exclude troublesome people who always identify problems require that attendees stand throughout the entire meeting have an explicitly defined purpose
30. Which of the following is most likely to improve the effectiveness of project communications? a. b. c. d.
developing a project procedures handbook scheduling project status meetings during lunch managers who are careful to confirm the accuracy of messages sent hiring a graphic artist to design the slides for project presentations
31. If an identified risk event has a 20% chance of happening in any given month and if the project is expected to last 5 months, the probability that this risk event will occur during the last month of the project is ______. a. b. c. d.
20% 40% 60% 80%
32. The tornado diagram in your risk management approach is aimed at _______. a. b. c. d.
depicting the interactions of multiple possible events probabilistic analysis of the project transferring high risks where possible assessing the impact of highly uncertain variables on the rest of the project
33. Which of the following is not a factor in the assessment of project risk? a. b. c. d.
6
risk event risk probability amount at stake insurance premiums
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Comprehensive Exam 1
34. Which task in the RACI chart shown below was entered incorrectly? Task A Task B Task C Task D a. b. c. d.
Dan R I A A
Sunil A R R R
Shinobu R A C C
Arturo I C A I
Task A Task B Task C Task D
35. An appropriate sequence for risk management activities is ______. a. b. c. d.
plan, identify, and analyze plan, identify, and mitigate identify, mitigate, and control identify, deflect, and mitigate
36. Which of the following is associated with procurement management? a. control procurements which results in handling early termination if there is a default b. manage procurements which results in resolving disputed changes c. conduct procurements which results in handling progress payments d. conduct procurements which results in a legally binding contract 37. You are developing a new technology for an actual product (voice commands through blue tooth in a golf cart to order food at the country club grill). There is still some risk in making this technology work successfully. The contractor is asking for some guarantees about profit or at least not losing money on the development work. An appropriate type of contract would be ________. a. b. c. d.
Fixed price with economic price adjustment, FP-EPA Time and material, T&M Cost plus guaranteed fee, CPGF Cost plus incentive fee, CPIF
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Comprehensive Exam 1
38. The Shandong Electric Power Company (SEPCO) located in Jinan, China is considering which of two projects is more attractive financially. One of their employees suggested they could use ROI as a financial evaluation tool if they simply substituted the cost savings generated by a project for revenues. In comparing the two projects, Project 1 is expected to generate cost savings of 1.6 million yuan at an overall cost of 1.1 million yuan. Project 2 is expected to generate cost savings of 1.95 million yuan at an overall cost of 1.5 million yuan. Which project has a better return on investment? a. b. c. d.
Project 1 because it costs less Project 1 with a superior ROI of 45.5% Project 2 because it saves more money Project 2 with a superior ROI of 30%
39. Standard contract clauses are desirable because they ______. a. b. c. d.
cover all situations for all contracts are legally sufficient and cost less to produce in most cases take less space than customized contracts and clauses eliminate the need for professional legal advice
40. As a buyer, a primary objective of a contract negotiation is ______. a. b. c. d.
obtaining products and services of the highest possible grade obtaining the lowest possible price ensuring that the contract is done on a fixed price basis obtaining a fair and reasonable price
41. Integration management includes which of the following processes? a. develop charter, develop project management plan, and perform integrated change control b. develop charter, develop project management plan, and control scope c. develop project management plan, direct project work, and collect requirements d. develop project management plan, direct project work, and create WBS
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Comprehensive Exam 1
42. You have been chosen as the project sponsor for the Brazos Development Project in the sprawling metropolis of Waco, Texas. The project is expected to last two years, is hoping to attract key businesses, and finally aims to provide 10,000 new jobs in the community. You have multiple demands on your time and have begun to think about when the project may need your involvement the most. During which of the following phases will you most likely have the greatest influence on the scope, time, cost, and quality of the project? a. b. c. d.
initiating phase planning phase executing phase closing phase
43. Which of the following is not part of administration closure? a. activities needed to ensure the exit criteria for the phase or project have been met b. activities needed to transfer the product, service, or result to the next appropriate step (phase, production, operations) c. activities to identify that changes are needed d. activities to collect records, document lessons learned, and archive information for future use 44. A project’s payback period occurs when ______. a. b. c. d.
profit has been maximized unit profit is reached monthly revenue exceeds monthly costs cumulative revenue equals or exceeds cumulative costs
45. A scope statement ______. a. b. c. d.
constitutes an agreement between the project team and the customer provides the format for documenting lessons learned approves the project for the stakeholders provides criteria for measuring project cost
46. A project manager can compare earned value performance data to all of the following except ______. a. b. c. d.
critical path analysis technical performance metrics funding required to complete the project forecasted cost and schedule estimates
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Comprehensive Exam 1
47. During the project scope management process, the work breakdown structure should be developed to ______. a. b. c. d.
the sub-project level the cost center level a level allowing for adequate estimates the level established by the project office
48. Decomposition is used to construct a ______. a. b. c. d.
variance analysis precedence diagram CPM diagram work breakdown structure
49. You are attempting to stimulate discussion to solve a persistent, recurring problem on your telecommunications project. Which of the following techniques is specifically designed for that purpose? a. b. c. d.
Ishikawa Diagram Pareto Chart Control Chart Run Chart
50. Your current status report reveals that the planned value of the work at this point is $500,000. It further shows that 50% of the $1,000,000 BAC has been completed and that 55% of the project budget has been spent. The data also show that 2 tasks are behind schedule. What is the SPI and what does it mean? a. b. c. d.
SPI = 1.0; the project is exactly on schedule SPI = 1.0; the project is behind schedule SPI = .9091; the project is ahead of schedule SPI = .9091; the project is behind schedule
51. A matrix organization attempts to combine some of the advantages of both functional and projectized organizations. The success of a matrix organization depends on ______. a. teamwork between project managers and functional managers to effectively resolve project conflicts b. the ability of the project team to develop a detailed scope of work c. project and functional managers sharing equal authority d. a Manager of Project Managers who resolves conflict across all projects
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Comprehensive Exam 1
52. Risk management involves _______, ______, and ______ uncertainties during a project. a. b. c. d.
quantifying, evaluating, and directing identifying, planning, and monitoring schedule, cost, and quality identifying, analyzing, and responding to
53. You are currently managing 8 members on your project team. You just gained one engineering specialist and transitioned three other people off the project. How many communication channels do you need to maintain? a. b. c. d.
6 7 18 21
54. Reynaldo has recently observed that many of the tasks on his project are “falling between the cracks” and important things are sometimes not getting done. Which of the following tools would provide the most benefit to Reynaldo in this situation? a. b. c. d.
work breakdown structure pareto chart responsibility matrix organization chart
55. A schedule completion date is most likely to change if ______. a. b. c. d.
the critical path is reduced management reserve is removed from the plan no float time is available project resources are reduced
56. Your project has fallen behind schedule due to conflict between team members. You have resolved the conflict. What should you consider to get the project back on schedule? a. b. c. d.
crashing resource leveling resource smoothing adding lag times along the critical path
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Comprehensive Exam 1
57. Risk analysis includes ______. a. b. c. d.
identifying potential risk events and impacts enumerating sources of internal vs. external risks evaluating probability and impact developing contingency plans
58. Which risk response tool is used only when triggered by a specific prior event? a. b. c. d.
contingent response strategy mitigate enhance insure
59. A precise physical description of a deliverable is called a ______. a. b. c. d.
specification baseline work package WBS dictionary
60. The purpose of fast tracking a project is to ______. a. b. c. d.
reduce project risks reduce project duration increase schedule tracking controls increase productivity
61. A purchase order represents a ________ and is used for _________. a. b. c. d.
unilateral contract; routine items unilateral contract; complex items bilateral contract; routine items bilateral contract; complex items
62. Which of the following are tools used in plan procurement management? a. b. c. d.
12
make-or-buy analysis, expert judgment, and market research contract types, bidder conferences, and expert judgment expert judgment, audits, and bidder conferences make-or-buy analysis, contract types, and weighting system
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Comprehensive Exam 1
63. Which rule for using a RACI chart is correct? a. b. c. d.
There should never be more than one person informed for a single task. There should never be more than one person accountable for a single task. There should never be more than one person responsible for a single task. There should never be more than one person consulted for a single task.
64. Which of the following conflict management approaches is believed to lead to the least enduring results? a. b. c. d.
problem solving smoothing withdrawing forcing
65. During the project planning process it is sometimes necessary to make assumptions when data are unavailable or uncertain. Which statement best describes assumptions for the purpose of project management? a. assumptions are considered to be true, real, or certain without proof or documentation b. making assumptions reduces project risks c. assumptions are based primarily upon historical data d. assumptions are derived from stakeholder analysis 66. Purchasing insurance is an example of risk ______. a. b. c. d.
acceptance transfer or deflection avoidance mitigation
67. From a supplier’s perspective, which form of contract entails the most risk? a. b. c. d.
cost plus fixed fee fixed price time and material unilateral
68. A Purchase Order becomes an enforceable contract ______. a. b. c. d.
upon shipment of the order by the seller when the buyer acknowledges receipt of the item when the delivery vehicle accepts the item from the seller when final payment is made to the seller
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13
Comprehensive Exam 1
69. Complex projects involving cross-functional efforts are most effectively managed by a ______. a. b. c. d.
functional organization project coordinator strong matrix organization projectized organization
70. Which of the following measures is used to forecast the project cost at completion? a. b. c. d.
CPI SPI BCWP ACWP
71. You are managing the renovation of the security system at a large hotel in Sydney, Australia. You have decided to use a more proven technology as one facet of your risk management approach. This is an example of risk _______. a. b. c. d.
sharing acceptance mitigation avoidance
72. Conflict resolution techniques include which of the following? a. b. c. d.
withdrawing, compromising, controlling, and forcing controlling, forcing, smoothing, and withdrawing confronting, compromising, smoothing, and directing smoothing, confronting, forcing, and withdrawing
73. It is critical for your company to offer its products on the Internet to maintain its competitive position. The company has little experience in this area but believes it is important to move quickly. As one of the resident PMP®s , you have been asked to start planning for this project. What is the first step you should take? a. b. c. d.
14
identify the risks plan the scope establish a resource plan complete a cost and schedule estimate
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Comprehensive Exam 1
74. Stakeholder management includes which of the following? a. b. c. d.
using tornado diagrams to identify and prioritize stakeholder requirements using the scope statement to identify and prioritize key stakeholders providing frequent cost and schedule status reports incorporation of stakeholder requirements into the project management plan
75. A possible result of using compromise to resolve a conflict is ______. a. b. c. d.
lose-lose win-lose win-win lose-win
76. Which statement about delegating is true? a. b. c. d.
You should delegate sufficient responsibility to get the job done. Delegation tends to lower morale. Delegation improves efficiency and productivity. Delegation improves quality.
77. A generally accepted method to confirm accuracy of task progress is through ______. a. b. c. d.
earned value expected monetary value maximum ceiling work breakdown structure
78. Which of the following is used to control the project schedule? a. b. c. d.
Pareto diagram work performance information parametric modeling statistical sampling
79. The _________ scope is measured against the requirements whereas the _________ scope is measured against the project management plan. a. b. c. d.
project, product product, project program, project project, program
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Comprehensive Exam 1
80. During which project phase is the amount at stake the lowest? a. b. c. d.
initiate plan execute close
81. If a contract is not completed as a result of contractor bankruptcy, failure to comply with contract requirements, or some other reason, such a circumstance is referred to as a ______. a. b. c. d.
force majeure broken promise tort breach of contract
82. Your project progressed exactly as planned until two days ago when you experienced a completely unexpected risk event. You quickly devised a response plan to deal with the situation. Your response is called a ______. a. b. c. d.
contingency plan corrective action workaround lesson learned
83. You have decided to identify and correct problems that are causing the most defects. You should use a ______. a. b. c. d.
Pareto chart run chart cause and effect diagram scatter diagram
84. Changing the project schedule should be done in accordance with the ______ and ________ processes. a. b. c. d.
monitor/control project work; control costs monitor/control project work; control schedule integrated change control; control costs integrated change control; control schedule
85. An individual’s willingness to take a risk can be affected by ______. a. b. c. d.
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decision tree modeling Monte Carlo simulation sensitivity analysis utility function
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Comprehensive Exam 1
86. All of the following assist in determining the impact of a scope change except ______. a. b. c. d.
project charter baseline work performance information work breakdown structure
87. A project was estimated to cost $1.5 million and scheduled to last six months. After three months, the earned value analysis shows the following: BCWP = $650,000 BCWS = $750,000 ACWP = $800,000 What are the schedule and cost variances? a. b. c. d.
SV = +$100,000 and CV = +$150,000 SV = +$150,000 and CV = -$100,000 SV = -$50,000 and CV = +$150,000 SV = -$100,000 and CV = -$150,000
88. Configuration management is most closely related to ______. a. b. c. d.
integrated change control validating scope defining scope analyzing quantitative risks
89. You have been assigned as a portfolio manager. Portfolios contain which of the following? a. b. c. d.
organizational project management operations management projects and programs organizational governance
90. Reviewing work products and results to ensure that all were completed satisfactorily and formally accepted is part of ______. a. b. c. d.
risk management quality control change control management validate scope
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Comprehensive Exam 1
91. Risk response planning is intended to ______. a. b. c. d.
create steps to identify project risks formulate strategies for dealing with adverse events construct a list of previous project risks develop measurements to quantify project risks
92. Your Transcontinental Super-Collider Project, based in Tokyo, is in deep trouble. A prominent stakeholder is visiting tomorrow for a briefing on the status and everyone knows that project termination is a serious possibility. You have negative slack on multiple paths and your cost variance is negative, as well. If the project is terminated, the scope validation process should ______. a. be delayed in case the project is re-instated after the board of directors completes its quarterly resource reallocation b. determine the correctness of the work results c. establish and document the level and extent of completion d. be canceled because there will be no further work to be evaluated 93. You are a project manager in a strong matrix organization. Which of the following is the most important skill you could have in such an environment? a. b. c. d.
ability to organize ability to communicate ability to plan ability to negotiate
94. Which of the following is true for a company that is certified under ISO 9001? a. Company products and services must meet the specified standard of quality set forth in ISO 9001. b. The company’s quality system must conform to the criteria set forth in ISO 9001. c. The company’s cost of quality must not exceed the threshold set forth in ISO 9001. d. Work processes must be measured using approved statistical quality control techniques. 95. Which of the following contract types places the greatest risk on the buyer? a. b. c. d.
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cost plus percentage of cost cost plus fixed fee cost plus incentive fee fixed price plus incentive fee
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Comprehensive Exam 1
96. You are the project manager of a large, two-year construction project and one of your most valuable team members has suggested a change during the last fiscal quarter of the execution phase. The team member is adamant that the change will greatly benefit the project, however, meeting the schedule has consistently been emphasized by your most important stakeholder. You should ______. a. b. c. d.
ask the project sponsor to take the change to the CCB call a meeting of major stakeholders to discuss the change reject the change because it is so late in the project evaluate the change in accordance with the project change control system
97. What is the most important consideration when using a fixed price contract? a. b. c. d.
a realistic schedule accurate development of the scope availability of resources availability of funds
98. Administrative closure is associated with the ______ process and addresses ______. a. b. c. d.
close project or phase; archives that comply with regulatory requirements close project or phase; monitoring and controlling of risks validate scope; formal acceptance of work results close procurements; deliverable acceptance
99. Task A has a 90% chance of finishing on time (based on historical experience) whereas Task B has only a 60% chance of finishing on time. You really need both tasks to finish promptly on this project. What is the chance that both tasks will be on time? a. b. c. d.
75% 60% 54% 30%
100. During contract closeout, the project manager needs to document ______. a. b. c. d.
formal acceptance the statement of work the payment schedule the change control procedure
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Comprehensive Exam 1
101. You are nearing completion of the final phase of a successful biomedical project. Earned value calculations currently indicate that the project will be completed on time and under budget by $500,000. At the completion of the project, the project manager will document and archive all project information. This information may be used for future projects in all areas except ______. a. b. c. d.
estimating durations estimating costs resolving conflicts allocating resources
102. Which procurement concept establishes a required level of quality and a remedy for failure to meet those standards? a. b. c. d.
warranty of merchantability warranty backcharge quality control
103. You are a native of Switzerland and have been a project manager for 15 years. You were just sent with no notice to handle a problem that arose in Shenyang, China. You have never been in an Asian country and, upon arrival at the airport, you find yourself to be confused. Finding transportation to the hotel was unusually difficult. At the hotel you also experience difficulty with door locks and turning on the lights. You struggle to find foods that you recognize. You are probably experiencing a phenomenon known as _______. a. b. c. d.
ethnocentricity time lag sociological distress culture shock
104. Which project management process provides a means of settling unresolved claims? a. b. c. d.
Close Procurements Close Project or Phase Control Procurements Perform Integrated Change Control
105. A key activity for achieving customer satisfaction is to accurately define ______. a. b. c. d.
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the expected business use requirements the change control process the project manager’s authority
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Comprehensive Exam 1
106. You are the project manager for a research and development project and find that a design error may interfere with meeting technical performance requirements. Your preferred response would be to ______. a. reduce the overall technical complexity of the project b. develop alternative solutions to the problem c. reduce the performance component of the triple constraint until it equals the revised performance output d. increase performance in some other aspect of the product to compensate 107. The ______ process provides formal documentation showing completion of the project or phase and transfer of completed deliverables to others, whereas the ______ process includes of copy of the closed contract and an indexed set of contract documentation. a. b. c. d.
close project or phase; close procurements close procurements; close project or phase close project or phase; validate scope monitor and control project work; validate scope
108. You recently had a discussion with your customer about the difference between quality and grade. You pointed out that grade is essentially _______. You further pointed out that low grade ________ and that low quality is ________. a. fitness for use; may be acceptable to save money; never acceptable because it means you are not meeting requirements b. features and functions; may be acceptable to save money; never acceptable because it means you are not meeting requirements c. features and functions; is not acceptable because of the cost; acceptable if the sponsor approves the change d. conformance to requirements; may be acceptable if the customer agrees; acceptable if the sponsor agrees 109. Which quality management process audits quality requirements and quality control measurements to ensure appropriate quality standards are met? a. b. c. d.
Perform quality assurance Control quality Plan quality management Validate scope
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Comprehensive Exam 1
110. The planning technique which progressively details the work as more information becomes known is referred to as ______. a. b. c. d.
critical path planning just-in-time planning rolling wave planning strategic planning
111. Using earned value, which of the following work completion rules is the most conservative? a. b. c. d.
percent complete 0/100 20/80 50/50
112. Herzberg is most known for a motivation theory that deals primarily with ______. a. b. c. d.
Theory X expectancy theory hygiene factors participative management
113. Which of the following statements about the risk management plan is not true? a. The risk management plan is an output of the Plan Risk Management process. b. The risk management plan includes a description of the responses to identified risks and triggers. c. The risk management plan includes budgets, scoring and interpretation methods, thresholds, and responsible parties. d. The risk management plan is an input to all the remaining risk planning processes. 114. Work authorization ______. a. b. c. d.
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is a process for sanctioning project work is necessary for scope management is tied to the individual tasks that are included in a work package includes procedures for work orders, contracts, and purchase orders
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Comprehensive Exam 1
115. You changed employers about a year ago and have been very pleased that your new organization provides strong emphasis and support for project teams. You are the project manager for one of several important research projects. Although your team members are borrowed from various functional areas, you write their performance appraisals and exercise considerable control over the expenditure of project funds. What type of organizational structure are you using and what might be one of your biggest potential problems? a. b. c. d.
projectized structure; duplication of resources functional structure; communication with project team members strong matrix structure; conflict with functional managers weak matrix structure; communication with project team members
116. Which of the following is one of the major components of the communication model? a. b. c. d.
urgency environment medium dimension
117. The cost estimator for a highway construction project used the historical cost per mile data for a similar highway that was recently built. This is an example of ______. a. b. c. d.
budget estimating parametric estimating bottom-up estimating top-down estimating
118. Both the CPM and PERT network analysis methods assume that estimated activity durations are ______. a. b. c. d.
mean distributed variance distributed statistically dependent statistically independent
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Comprehensive Exam 1
119. You are part of a revolutionary project to prove that traffic safety will be improved and related accident-response costs will be reduced if drivers are only allowed to make right turns. Dubbed as the “Right Stuff” project, the latest status report included a Gantt chart showing that three consecutive activities have each been completed a week early. The lead engineer is on vacation and therefore not available for comment. Based on this information, the project is ______. a. b. c. d.
ahead of schedule three weeks ahead of schedule behind schedule indeterminate from the information given
120. Duration estimates indicate ______. a. b. c. d.
how many hours a resource will work on an activity how many work periods an activity will take when an activity is likely to start when an activity is likely to finish
121. Which stakeholder management process provides a classification scheme for comparing desired levels of stakeholder engagement to actual levels of engagement? a. b. c. d.
Control Stakeholder Engagement Identify Stakeholders Plan Stakeholder Management Manage Stakeholder Engagement
122. Which of the following are potential sources of power for project managers? a. b. c. d.
expert, referent, charisma compromise, coercive, reward formal, bureaucratic, influencing referent, compromise, bureaucratic
123. Which conflict resolution method is preferred when one of the parties has become angry or belligerent? a. b. c. d.
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problem solving withdrawing forcing compromising
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Comprehensive Exam 1
124. A buyer is most likely to award a Cost Plus Incentive Fee contract to a seller under which of the following conditions ______. a. b. c. d.
scope is well defined and you are entering into stable production scope is well defined and you are entering into limited production scope is not well defined and you are conducting exploratory research scope is not well defined and you are conducting applied research
125. Which of the following is not a component of Abraham Maslow’s Hierarchy of Needs? a. b. c. d.
expectancy social self-esteem self-actualization
126. The most common causes of conflict in a project environment include ______. a. b. c. d.
personalities, project priorities, quality personalities, schedules, project priorities schedules, project priorities, resources cost, personalities, schedules
127. J & M Electronics has been selected to install an updated security system that complies with current legal requirements. The customer is a care-provider called Rest Easy Elderly People (REEP). The contract includes a provision that requires J & M to pay a penalty of $3,000 per day for every day beyond the agreed completion date of June 30th. This contractual provision is an example of ______. a. b. c. d.
liquidated damages implied warranty backcharge constructive change
128. Calculating the expected monetary value of a specific project risk is done by ______. a. b. c. d.
using decision analysis subtracting the risk impact from the amount of management reserve multiplying the risk probability by the risk impact estimating the value of the associated workaround plan
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129. Sensitivity analysis is one of many possible methods to identify potential risks. Which of the following is an advantage of sensitivity analysis? a. b. c. d.
It makes the team feel involved and therefore promotes “buy-in”. It provides statistically independent choices. It provides a range of possible outcomes. It provides a qualitative dimension to the risk assessment.
130. Administrative closure for the feasibility phase of a project requires that ______. a. b. c. d.
the phase has satisfied all requirements lessons learned are implemented phase results are verified and documented project feasibility has been established
131. You have been assigned to an especially important medical research project in the southwestern region of your hospital consortium. The project is tackling a rather uncertain and developing technology. The project is large in size and is quite important in the ten-year strategy for your consortium. Your key sponsor recently expressed concern that the team needed to be really committed to the success of this effort. Which organizational structure would best meet the needs of this project? a. b. c. d.
technical functional matrix projectized
132. Who is responsible for making sure the message is clear, unambiguous, and complete? a. b. c. d.
project manager sender receiver both sender and receiver
133. When the issues are extremely important to both parties, the most effective method for conflict resolution is ______. a. b. c. d.
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forcing compromise smoothing problem solving/confronting
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Comprehensive Exam 1
134. The literature on leadership styles refers to which three basic approaches? a. b. c. d.
formal, directive, and laissez-faire autocratic, expert, bureaucratic integrated, directive, and democratic autocratic, laissez-faire, and democratic
135. You are working on a new project in your organization. Your company’s staff can easily meet some of the project requirements but do not have the expertise to handle several of the key requirements. You are aware of other companies that specialize in some of the areas where you lack internal capability. As part of plan procurement management, your first step should be to ______. a. b. c. d.
conduct a market survey conduct a make-or-buy analysis solicit proposals from prospective suppliers using an RFP consult your qualified seller list and send an RFP to appropriate suppliers
136. For the past several weeks, two of your team members have been arguing about which software development program will meet the needs of your project. You need to make a decision and you are also sick and tired of listening to them. You decide to hold a meeting to seek consensus by emphasizing any common points of agreement to come to a fair resolution. You are using which form of conflict resolution? a. b. c. d.
problem solving smoothing withdrawing compromising
137. You have a large volume of information that may be needed by different parties at different times. Which communication method is most suited to this situation? a. b. c. d.
interpersonal push efficient pull
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Comprehensive Exam 1
138. Research at your company has finally caught up with futuristic concepts portrayed in the greatest science fiction epic of our time, Star Trek. Yes, you are actually achieving success with human transporter devices. At the last project meeting, held at a secret location, a representative from the marketing department indicated that reliable intelligence data indicate that a competitor is near completion of a similar product. Suddenly the schedule has become of paramount importance. Worse yet, you are forced to remind the team that because of resource limitations at the outset, the project was planned using resource leveling. Now that you need to race a competitor to market, you desperately need to bring the resource leveled schedule back in line with the original schedule, if possible. Which of the following tools will help you in this endeavor? a. b. c. d.
a reward and recognition system resource manipulation reverse resource allocation crashing
139. Your team is working on a highly dangerous infrastructure rehabilitation project in an undisclosed country that has experienced significant violence between rival political factions. During the fifth month of your project, civil conflict erupts over the murders of key people on both sides of the country’s internal conflict. The violence begins to escalate and a decision is made to stop the project and send your team home immediately. How should you handle a risk of this type? a. intense up-front risk management planning with continual reviews throughout the project’s life cycle b. periodic risk reviews or audits c. disaster recovery actions rather than risk management d. a risk repository that serves as the basis for the risk portion of a lessons learned database 140. Your experience has been primarily with federal government projects and you have noticed that additional funds tend to become available near the end of each fiscal year. These funds have proven useful in handling desired changes in project requirements. However, you also have learned that a cost change control system is needed to handle these situations effectively. The purpose of this cost change control system is to ______. a. b. c. d.
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determine whether a budget update is required determine why a cost variance has occurred define the procedures by which the cost baseline may be changed define when contingency funds should be used
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Comprehensive Exam 1
141. Your company is hiring a project engineer. Yesterday, your boss intervened in the evaluation process and influenced the committee to hire a candidate that turned out to be his nephew. No further consideration was given to equally qualified candidates. This action violates standards of conduct associated with ________. a. b. c. d.
honesty respect fairness responsibility
142. Which of the following statements about a responsibility assignment matrix (RAM) is true? a. b. c. d.
Also called a RACI chart, only one person should be responsible. Also called a RACI chart, only one person should be accountable. A RAM shows the timing of the identified tasks. A RAM is created as part of Acquire Project Team.
143. Which of the following statements about management reserve are true? i. Management reserve is intended to reduce the chance of a cost overrun. ii. Management reserve funds may be used to fund work not originally authorized for the project. iii. Management reserve funds may be used to fund unforeseen problems. a. b. c. d.
i & ii i & iii ii & iii i, ii, & iii
144. If a project has a 70% chance of a $100,000 profit and a 30% chance of an $80,000 profit, the expected monetary value for the project is a ______. a. b. c. d.
$180,000 profit $ 100,000 profit $ 94,000 profit there is insufficient information to answer the question
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Comprehensive Exam 1
145. Sigmund Ford is having a heated debate with Frederick Young about the best method for displaying a schedule network diagram. Frederick has indicated that arrow diagrams are the best way to show a schedule. Sigmund maintains that precedence diagrams allow flexibility in the choice of dependencies and are able to deal more effectively with lag times in the schedule. Sigmund also challenged Frederick to name a software program that uses arrow diagrams. Another reason that many project managers prefer precedence diagrams over arrow diagrams is that they ______. a. b. c. d.
handle a large number of activities better simplify scheduling by avoiding overlapping activities do not require dummy activities allow the project manager to identify the critical path
146. Which of the following are the obligations for professional conduct as stated by the PMI® Code of Ethics and Professional Conduct? a. b. c. d.
loyalty, sensitivity, fairness, and teamwork responsibility, respect, fairness, and honesty fairness, honesty, cooperation, loyalty respect, fairness, honesty, cooperation
147. According to current quality management thinking, which of the following approaches is least likely to produce quality improvements? a. b. c. d.
increased inspection quality audits process improvement plans statistical quality control
148. Which process and tool provide a means to rank the importance of each stakeholder? a. b. c. d.
Identify Stakeholders; Stakeholder Analysis Identify Stakeholders; Expert Judgment Manage Stakeholder Engagement; Analytical Techniques Manage Stakeholder Engagement; Stakeholder Analysis
149. “Employees who believe their efforts will lead to effective performance and who also believe they will be rewarded for their accomplishments will stay productive as long as the rewards meet their expectations”. This statement illustrates ______. a. b. c. d.
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Theory Z expectancy theory requirements-rewards matrix hygiene factors
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Comprehensive Exam 1
150. If the project is experiencing increasing levels of conflict due to poor communication, which of the following is most likely to improve the situation? a. b. c. d.
encouraging the team to socialize outside of work scheduling project status meetings early in the morning installing the latest version of the automated scheduling tool used by the team scheduling an off-site team building workshop
Note: Use the following figure to answer questions 151 through 156!
Figure 1: Schedule
A 4d
E 4d
C 3d
G 6d
Start
B 7d
End
D 5d
F 4d
© C. Michael Farr
151. Using the schedule in Figure 1, what is the expected duration for the project? a. b. c. d.
17 days 18 days 20 days 22 days
152. Which tasks are on the critical path? a. b. c. d.
A, C, E, G B, C, E, G B, D, G B, D, F, G
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Comprehensive Exam 1
153. What is the float at task D? a. b. c. d.
zero days two days five days minus four days
154. Which of the following tasks has free float? a. b. c. d.
Task A Task B Task D Task G
155. What is the early finish for task F? a. b. c. d.
8 days 10 days 12 days 16 days
156. You have just been told that you must reduce the total project duration by three days. Your boss is a PMP® and says she wants you to use crashing to achieve the schedule reductions. Using Figure 1 and the data provided below, which tasks would you need to crash in order to achieve the required schedule reduction? Task
Normal Time
Crash Time
A B C D E F G
4 days 7 days 3 days 5 days 4 days 4 days 6 days
3 days 6 days 3 days 3 days 3 days 2 days 3 days
a. b. c. d.
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Crash Cost per Day $25 $40 N/A $50 $75 $25 $100
A, F G B, D B, E, G
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Comprehensive Exam 1
157. Robbie, Charlie, and Allison are project managers at a major petrochemical company and they have formed a study group to help prepare for the PMI® certification exam. At their last lunch meeting, Robbie and Charlie were not sure what “free float” meant. Allison indicated that free float is ______. a. how long a task can be delayed without causing the project to be late b. how long a task can be delayed without delaying the start of any immediate successor tasks c. allowing critical resources to float where needed to smooth out the critical path d. moving tasks into other time periods to resolve resource limitations Note: Use Figure 1 above and the data provided below to answer questions 158 through 162. Task A B C D E F G
Total Planned Value $200 $300 $500 $400 $1000 $500 $800
Planned Value After 14 Days
Earned Value
Actual Cost
$200 $300 $500 $400 $1000 $500 $0
$200 $300 $400 $300 $800 $500 $0
$250 $300 $400 $350 $800 $600 $0
158. Fourteen work days have elapsed for the project shown above in Figure 1. Using Figure 1 and the data given above, use earned value analysis to calculate the cost variance for the overall project. All data are based on what has happened after the first fourteen days. a. b. c. d.
CV = - $200 CV = +$200 CV = $1200 CV = - $400
159. Using the same data as above, interpret the cost and schedule status of the project at this point. a. b. c. d.
cost underrun and behind schedule cost overrun and ahead of schedule cost underrun and ahead of schedule cost overrun and behind schedule
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Comprehensive Exam 1
160. Given the status thus far, what is the total cost of the project expected to be when it is completed (assume current variances will be typical of remaining performance)? a. b. c. d.
approximately $3425 exactly $3700 approximately $4000 approximately $4300
161. If your organization believes a project is within acceptable boundaries as long as cost and schedule performance are within plus or minus 10 percent of the plan, how is this project doing? a. b. c. d.
Cost performance is acceptable but schedule is out of prescribed limits. Cost performance is outside of limits but schedule performance is okay. Both cost and schedule performance are outside of normal limits. Both cost and schedule performance are acceptable.
162. What percent of the original budget has been spent thus far? a. b. c. d.
approximately 68% of the budget has been spent approximately 108% of the budget has been spent approximately 92% of the budget has been spent approximately 73% of the budget has been spent
163. Using the data given below, which task has the least float? Task A B C D a. b. c. d.
Early Finish 5 5 8 10
Late Finish 5 8 12 5
A B C D
164. Using the same data given in question #163, which task has the most float? a. b. c. d.
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A B C D
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Comprehensive Exam 1
165. Using the data again from question #163, which task is most likely on the critical path? a. b. c. d.
A B C D
166. You are convinced that effective delegating of project tasks will improve productivity and team morale. However, you also believe that ________ should not be delegated. a. b. c. d.
monitoring the work of your most crucial subcontractor performance of tasks on the critical path pay and hiring risk identification
167. The company is taking a vote to see if the contracting department should be split up and reassigned to many projects or remain intact. A contract professional might not want this to occur because they would lose _________ in a decentralized contracting environment. a. b. c. d.
standardized company project management practices loyalty to the project a clearly defined career path expertise
168. Which type of organization is least suited for managing complex projects involving cross-disciplinary efforts? a. b. c. d.
projectized matrix line functional
169. Which step in your approach to human resource management should first consider training needs? a. b. c. d.
staffing management plan organization chart acquisition interpersonal skills
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Comprehensive Exam 1
170. Which of the following is a tool for Plan Procurement Management? a. b. c. d.
make-or-buy decisions bidder conferences make-or-buy analysis statement of work
171. The lowest level of the WBS is called a ___________ and has the following characteristics: _______ and _______. a. b. c. d.
task, duration estimate, responsibility assignment activity, duration estimate, responsibility assignment work package, responsibility assignment, assignment to a cost account work package, duration estimate, primary stakeholder
172. Which of the following accurately describes a project charter? a. b. c. d.
provides a project schedule and budget authorizes funding to begin work on the project describes the company vision and names the team members of a project authorizes the project manager to expend resources to accomplish a particular business objective
173. You just received the latest deliverable on the in-store, real-time inventory upgrade project. Project completion is scheduled in three weeks. A quick test revealed that the deliverable is defective and does not perform as needed. If you fail to demand a correction in a timely manner, you have effectively provided a ________. a. b. c. d.
breach of contract warranty waiver backcharge
174. The matrix organizational structure ______. a. is used to manage multiple projects simultaneously when the organization does not have the resources to staff each individual project on a full-time basis b. ensures less conflict when compared to other organizational structures c. is used when an organization decides to undertake a single, large project d. allows a stronger focus on cost and schedule objectives than other organizational structures
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175. You are managing a team consisting of some of the best technical experts in the world. Which management style may be most appropriate for this high-knowledge group? a. b. c. d.
directive laissez-faire autocratic democratic
176. The Tuckman ladder of team development identifies the stages that teams experience as they are formed and work together. Those stages are ______. a. b. c. d.
forming, storming, norming, performing, and adjourning forming, norming, adjusting, performing, and adjourning forming, planning, performing, and adjourning forming, norming, performing, and adjourning
177. As a program manager for numerous European water improvement projects, you have noticed lately that certain problems have begun to plague your efforts. You decide to choose a technique that will help a strategically chosen group of experts stimulate their thinking and discussion of the likely causes for these problems. You should use a/an ______. a. b. c. d.
Tornado Diagram Decision Tree Ishikawa Diagram Pareto Chart
178. You have been assigned as the lead negotiator for a rather urgent situation. The other party shares an equal power base and is committed to a different solution. The issues involved are complex and leaders in both organizations have expressed the need for some expedient solution, even if it is only temporary. You have decided that _________ is the most appropriate conflict resolution technique, however, you are concerned that the long-term result might be a __________ outcome. a. b. c. d.
forcing; win-lose withdrawal; lose-win smoothing; lose-win compromise; lose-lose
179. The risk register is an input to which of the following processes? a. b. c. d.
Plan Quality Management Perform Quality Assurance Control Quality Develop Project Team
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Comprehensive Exam 1
180. As an experienced project manager, you personally believe that managing the human side of projects is crucial to your overall success. You are aware that the project management process for “manage project team” involves tracking team performance, providing feedback, and resolving issues. Which of the following is not a tool of manage project team? a. b. c. d.
observation and conversation performance appraisals conflict management ground rules
181. You are the project manager for a major renovation of the Las Vegas Oasis hotel. After several intense negotiating sessions, you have agreed on the following contract terms: the contract will be a fixed price incentive fee (FPIF), the target cost will be $100 million, the target profit will be $20 million, the share ratio will be .75/.25, and the ceiling price will be $150 million. You know that there is a point at which the contract incentive stops and all additional costs come entirely from the contractor’s profit. This concept is known as the point of total assumption (PTA). What is the PTA for this contract? a. b. c. d.
$120 million $140 million $150 million PTA does not apply to an FPIF contract
182. If the final, actual cost of the Oasis project from question #181 was $80 million, what contract price would the customer pay? Assume that no changes were made to the agreement described above. a. b. c. d.
$ 95 million $100 million $105 million $120 million
183. If the final, actual cost of the Oasis project from question #181 was $120 million, what contract price would the customer pay and what would the seller’s profit be? Assume that no changes were made to the agreement described above. a. b. c. d.
38
$120 million, $20 million $135 million, $15 million $140 million, $20 million $150 million, $30 million
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Comprehensive Exam 1
184. You are leading a multinational project involving your country (Germany) and five other countries on three continents. The current phase, for validating the key technology, is operating under a CPIF (cost plus incentive fee) contract with the following terms: target cost is $100 million, target profit is $25 million, the share ratio is .50/.50, the maximum fee is $35 million, and the minimum fee is $15 million. If the final cost of the phase is $116 million, what price will the customer pay? a. b. c. d.
$116 million $120 million $125 million $133 million
185. You are just finishing the first month of the contract to supply new uniforms for all basketball referees throughout the NCAA (National Collegiate Athletic Association). You are about to review earned value data to verify whether, as the contractor claims, the project is on track. The data show that the CPI is 0.94 and actual costs are $50,000. Given these data, what is the earned value? a. b. c. d.
$47,000 $50,000 $53,191 there is not enough information to determine the earned value
186. The CPI on the NCAA uniform project is 0.94 and you have calculated the EAC as $319,148.94 (you assumed current variances will be representative of future performance). What was the original budget (BAC) for the project? a. b. c. d.
$339,520.14 $319,148.94 $300,000 there is not enough information to determine the budget at completion
187. You just assumed the PM role for a project with numerous potential risk variables. The project includes international partners and the steering committee has tasked you to examine and compare the relative importance and impact of variables that may have high uncertainty versus those that may be more stable. You have decided to use a ______. a. b. c. d.
Ishikawa Diagram Tornado Diagram Decision Tree Log-Normal Distribution Diagram
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Comprehensive Exam 1
188. You are a brand new project manager with a total of six months of experience in the information technology industry. You were given your first project to run “on your own” (no mentor or coach) and the project is somewhat risky. You are concerned about accurate planning data for the schedule and budget and you expressed your concerns to an experienced colleague yesterday. She mentioned that you might consider using PERT. You were too embarrassed to ask her what PERT stands for but, after looking it up, you now know that PERT stands for ______. a. b. c. d.
Program Evaluation Review Technique Procurement Evaluation Review Technique Project Evaluation Requirements Tool Proposal Evaluation Risk Tool
189. Shinobu Sugiyama is the project manager for the design and installation of three fire and safety alarm systems in Nagasaki, Japan. Shinobu can either rent or lease a key piece of equipment needed for the job. Given the following information, how many days would the equipment need to be used before the costs of the two choices would be the same? Maintenance costs Daily operating costs Rental costs a. b. c. d.
Rent $0 $0 $160 per day
Lease $3200 per year $80 per day $0
30 days 35 days 40 days 45 days
190. Arnold “Terminator” Schwartz has the reputation for being hard on project managers who present status reports to him during weekly meetings. Arnold just completed a one-day seminar sponsored by the Project Management Institute and now thinks he is an expert on the PMBOK® Guide. Yesterday, he quizzed you about which of the following was an output of control procurements. You answered ______. a. b. c. d.
40
contract change control system inspections and audits work performance reports work performance information
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Comprehensive Exam 1
191. You are so new to project management that you are still referred to as “Rookie”. You need to know more about the product your project is supposed to deliver. An experienced colleague told you that there is a document that describes the precise requirements, design, behavior, and other characteristics of a system, component, product, result, or service. The document you need is a _______. a. b. c. d.
Request for Proposal (RFP) Specification Statement of Work (SOW) Statement of Objectives (SOO)
192. You are leading a new project to develop a breakfast cereal that will be less filling, have outstanding taste, and improve memory function in the average human being by 15%. The cost estimate for the next phase came in at $100,000 with the caveat that actual outcomes could range from $90,000 to $125,000. What kind of estimate is this? a. b. c. d.
Rough Order of Magnitude (ROM) Order of Magnitude Budget Definitive
193. Tasks A, B, and C have durations of 8, 5, and 7 days respectively and are performed in sequence using finish-to-start dependencies. Task D has a duration of 8 days and a finish-to-finish dependency with Task A. Task E has a duration of 14 days and has a finish-to-start dependency with Task D. What is the late finish for Task A and Task D? a. b. c. d.
Task A = 22 & Task D = 22 Task A = 10 & Task D = 10 Task A = 10 & Task D = 8 Task A = 8 & Task D = 8
194. You are leading the effort to submit a proposal on a production contract for a revolutionary device that is intended to improve the productivity and morale of workers in a variety of industries who drive long distances, make long international flights, or just simply work long hours in uncomfortable seats. You are concerned that your labor rates may be too high and you have been asked to identify ways to reduce costs. Which recommendation would be the best to present to management at your next meeting? a. Use existing labor rates combined with a value engineering program to lower overall costs. b. Reduce labor rates so they match the competition and pay any extra costs from another project budget. c. Substitute newly hired staff with lower labor rates if you win the bid. d. Use a technique you recently learned about called crashing the project.
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Comprehensive Exam 1
195. You are kicking off a complex project that seems to have numerous loops and conditional branches. A more experienced colleague recommended a technique that is not used as much as traditional network diagrams but is capable of dealing with your situation. Which of the following did he recommend? a. b. c. d.
PERT GERT VERT QWERT
196. Your division Vice President has placed you in charge of preparing a “ballpark” guesstimate for an upcoming project. You have been given 36 hours to be ready with the estimate which will then be used to support a project go or no-go decision. Which of the following techniques should you consider and what approximate range of accuracy do you expect? a. b. c. d.
Order of Magnitude estimate with - 25 to + 25 percent accuracy Analogous estimate with - 50 to + 50 percent accuracy Order of Magnitude estimate with - 25 to + 75 percent accuracy Budget estimate with - 10 to + 25 percent accuracy
197. You have been a project manager for 10 years, a program manager for 3 years, and were just assigned to a portfolio management team. Such a team would be most involved in which of the following activities? a. b. c. d.
Portfolio managers monitor and control work results. Portfolio managers manage programs and project managers. Portfolio managers measure success by extent of customer satisfaction. Portfolio managers ensure that project objectives align with the strategic goals of the organization.
198. You are looking for some insights that would help you understand and manage team members more effectively. Specifically, you want to know more about people’s varying needs for success and power. You should read up on which of the following? a. b. c. d.
42
Maslow’s Hierarchy of Needs McClelland’s Needs-Achievement Index Myers-Briggs Needs Indicator Ishikawa Needs Chart
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Comprehensive Exam 1
199. Two of your best team members are experiencing some interpersonal issues. Ted is very task and schedule driven. He uses a daily to-do list and becomes upset when deadlines are missed. He expects others to engage in serious planning meetings. Kristen is the very definition of flexible and spontaneous. She has a lot of excellent ideas and love to initiate action on those ideas. She has a tendency to get distracted and not meet previously agreed deadlines. You are reminded of the Myers-Briggs model and decide to use it as a guide to understanding the issues. Ted is characterized by the preference known as ________ and Kristen is characterized by ________. a. b. c. d.
Judging; Intuitive Sensing; Perceiving Judging; Perceiving Sensing; Intuitive
200. The latest “hurry up and wait” project in your company is in its third month and you are calmly at the helm as the second project manager for this doomed endeavor. Your team is working feverishly to acquire accurate and timely performance data and you think that you are close to understanding the real status of the work. The latest earned value data just arrived and show that the CPI is .88, the SPI is .82, the percent complete is approximately 40%, and the ETC is $2.5 million. Which is the most likely explanation for this status? a. b. c. d.
A key resource went out on emergency sick leave two weeks ago. The cost of fuel dropped by 10 percent. It took three days for concrete to cure. New York Stock Exchange values rose by 5 percent last month.
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Comprehensive Exam 1
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Comprehensive Exam 1 Answer Sheet #1 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. 23. 24. 25. 26. 27. 28. 29. 30. 31. 32. 33. 34. 35. 36. 37. 38. 39. 40. 41. 42. 43. 44. 45. 46. 47. 48. 49. 50.
51. 52. 53. 54. 55. 56. 57. 58. 59. 60. 61. 62. 63. 64. 65. 66. 67. 68. 69. 70. 71. 72. 73. 74. 75. 76. 77. 78. 79. 80. 81. 82. 83. 84. 85. 86. 87. 88. 89. 90. 91. 92. 93. 94. 95. 96. 97. 98. 99. 100.
101. 102. 103. 104. 105. 106. 107. 108. 109. 110. 111. 112. 113. 114. 115. 116. 117. 118. 119. 120. 121. 122. 123. 124. 125. 126. 127. 128. 129. 130. 131. 132. 133. 134. 135. 136. 137. 138. 139. 140. 141. 142. 143. 144. 145. 146. 147. 148. 149. 150.
151. 152. 153. 154. 155. 156. 157. 158. 159. 160. 161. 162. 163. 164. 165. 166. 167. 168. 169. 170. 171. 172. 173. 174. 175. 176. 177. 178. 179. 180. 181. 182. 183. 184. 185. 186. 187. 188. 189. 190. 191. 192. 193. 194. 195. 196. 197. 198. 199. 200.
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Comprehensive Exam 1
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Comprehensive Exam 1 Simple Answer Key: Comprehensive Exam #1 Answer 1. d 2. a 3. d 4. b 5. a 6. a 7. c 8. d 9. b 10. c 11. d 12. b 13. c 14. d 15. d 16. a 17. c 18. a 19. a 20. b 21. c 22. a 23. d 24. c 25. d 26. b 27. a 28. a 29. d 30. c 31. a 32. d 33. d 34. c 35. a 36. d 37. d 38. b 39. b 40. d 41. a 42. a 43. c 44. d 45. a 46. b 47. c 48. d 49. a 50. a
Answer 51. a 52. d 53. d 54. c 55. a 56. a 57. c 58. a 59. a 60. b 61. a 62. a 63. b 64. b 65. a 66. b 67. b 68. a 69. c 70. a 71. d 72. d 73. b 74. d 75. a 76. c 77. a 78. b 79. b 80. a 81. d 82. c 83. a 84. d 85. d 86. a 87. d 88. a 89. c 90. d 91. b 92. c 93. b 94. b 95. a 96. d 97. b 98. a 99. c 100. a
Answer 101. c 102. b 103. d 104. a 105. b 106. b 107. a 108. b 109. a 110. c 111. b 112. c 113. b 114. a 115. c 116. c 117. b 118. d 119. d 120. b 121. c 122. a 123. b 124. d 125. a 126. c 127. a 128. c 129. c 130. c 131. d 132. b 133. d 134. d 135. b 136. b 137. d 138. d 139. c 140. c 141. c 142. b 143. b 144. c 145. c 146. b 147. a 148. a 149. b 150. d
Answer 151. c 152. b 153. b 154. a 155. c 156. d 157. b 158. a 159. d 160. c 161. a 162. d 163. d 164. c 165. d 166. c 167. d 168. d 169. a 170. c 171. c 172. d 173. c 174. a 175. b 176. a 177. c 178. d 179. a 180. d 181. b 182. c 183. b 184. d 185. a 186. c 187. b 188. a 189. c 190. d 191. b 192. c 193. d 194. a 195. b 196. c 197. d 198. b 199. c 200. a
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Comprehensive Exam 1
Detailed Answer Key: Comprehensive Exam #1 No.
Answer
Slides
Note
1
d
5-63
See output #2, Change Requests. Bottom-up cost estimating is part of cost management (not scope).
2
a
4-41
See the note at the bottom of slide 4-41.
3
d
9-30
The team has just moved from storming to norming.
4
b
4-57
See customer satisfaction: Needs analysis precedes requirements definition. If the needs assessment is faulty, the requirements will also be faulty.
5
a
4-31 10-27
PMI recognizes three major types of reports: status, progress, and forecasts (covered in the integration and communication units).
6
a
4-8
The PM should be assigned as early as is feasible but not later than the start of planning.
7
c
11-59
As a tool of Control Risks, risk reassessment tracks whether new risks have emerged and also tracks the disposition of identified risks (did they actually occur or not).
8
d
4-8 4-12
A project charter is used to formally authorize a new project or the next phase of a project.
9
b
6-87
See output #2, project schedule. Hammock activities are often used as part of bar charts (Gantt charts) to summarize a series of interdependent work packages.
10
c
5-36
Work packages are tasks at the lowest level displayed in the WBS.
11
d
12-25 12-26
FFP places the greatest cost risk on the contractor (seller) but also offers the maximum profit potential. It’s classic utility theory: maximum reward for maximum risk incurred.
12
b
4-10
The business case is an input to Develop Project Charter. It includes a description of the business need and the cost-benefit analysis that justifies the investment.
13
c
5-40
See output #1 scope baseline, WBS, bullet #2. Cost accounts are also called control accounts. They are categories of work in a WBS, are the lowest level at which organizational responsibility is assigned, and represent management control points.
14
d
7-47 to 7-49
See tool #1, earned value management. Indexes less than one indicate bad news (cost overrun and behind schedule) and indexes greater than one are good news (cost underrun and ahead of schedule).
15
d
2-7 2-8
See guidelines for ethical conduct. Under the rules for fairness: Do not allow conflicts of interest to harm anyone's legitimate business interests. However, you have the right to use your knowledge and experience.
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51
Comprehensive Exam 1 No.
Answer
Slides
16
a
8-43
See tool #2, statistical sampling. With greater conformance (fewer defects), sampling could be employed more aggressively and, therefore, reduce the cost of quality control.
17
c
5-18
Also see p. 5-6 in the reference manual. See tool #3, facilitated workshops, bullet #2, quality function deployment.
18
a
8-23
The Rule of 7 provides a heuristic-style guideline for investigating possible problems whenever a control chart shows specific trends even though the outcomes are within the control limits.
19
a
8-9
PMI provides high emphasis on the idea that quality must be planned in, not inspected in. Similarly, money spent on costs of conformance is preferred over money spent on costs of non-conformance (fixing defects)
20
b
8-14
Prevention and appraisal costs are associated with costs of conformance (preventing defects). Failure costs are part of the cost of nonconformance.
21
c
6-76 6-81
See tool #7, schedule compression. Fast tracking moves more work into parallel which means some of the work must be performed in different time periods. In turn, this requires reassignment of people into different time periods.
22
a
4-54
See MBO (objectives identified jointly with management and employees working together).
23
d
9-51
See motivation theory #5, McClelland’s Trichotomy of Needs, Need for Affiliation.
24
c
9-60
See item #4, productivity (output produced per unit of input, such as hours of labor).
25
d
8-19
Pareto Charts are vertical bar charts with the tallest bar on the left. Other bars decline in descending order to the right. The bars identify the number of defects attributed to a specific cause. Typically, 80% of defects are caused by only a few sources and this knowledge guides corrective actions to the most productive areas.
26
b
N/A
General knowledge and logic. PMI has sometimes asked questions with no specific reference; just basic logic. Notice that choice b refers to shareholders, not stakeholders.
27
a
10-17
See other notes for the exam, item #2: verbal communication is the best way to conduct brainstorming when working on a complex problem.
28
a
5-14
Choice b: an input, not a tool. Choice c: not a tool for Collect Requirements. Choice d: an output, not a tool.
29
d
10-40
See effective team communication: make meetings effective.
30
c
10-17
See sender responsibilities: ensure information is clear and complete, and confirm receiver’s understanding.
31
a
11-64 11-65
See basic principles of probability theory.
52
Note
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Comprehensive Exam 1 No.
Answer
Slides
Note
32
d
11-37
See the description of a tornado diagram under the heading of sensitivity analysis.
33
d
11-4
See risk factors (event, probability, amount at stake).
34
c
9-12
Never more than one person should be assigned accountability for a single task. This avoids confusion.
35
a
11-7
The sequence laid out by PMI is planning, identification, qualitative and quantitative analysis, response planning, and controlling (choice a).
36
d
12-5
Choice a: Early termination is handled as part of close procurements. Choice b: Disputed changes are handled as part of control procurements (also there is no procurement process called manage procurements). Choice c: Progress payments are handled during control procurements. Choice d: Is correct; conduct procurements is aimed at awarding a legally binding contract.
37
d
12-19 12-26
CPIF contracts are for applied research to develop a new product. However, the work is still risky and might not work out as hoped. CPIF also provides a guaranteed fee of a certain amount (called minimum fee).
38
b
7-74 7-75
The formula for ROI is (Revenue-Cost)/Cost. It is an accepted practice to substitute cost savings for revenue if the project is aimed at cost savings from an improved process or product. Using that logic: Project 1 ROI = (Cost savings-Cost)/Cost = (1.6 mil-1.1 mil)/1.1 mil = .5 / 1.1 = .4545 or 45.5%. Project 2 ROI = (1.95 mil-1.5 mil)/1.5 mil = .45 / 1.5 = .30 or 30%. Conclusion: Project 1 has a better ROI. Both projects save more than they cost but the return on Project 1 is better.
39
b
12-67
See p. 12-20 in the reference manual. Standard contract clauses are less costly to develop and they reduce the chance of legal disputes.
40
d
12-44
See tool #7, a major objective of a contract negotiation is to get a fair and reasonable price.
41
a
4-2
Choice b: Control Scope is incorrect. Choice c: Collect Requirements is incorrect. Choice d: Create WBS is incorrect. The integration management processes are: develop project charter, develop project management plan, direct and manage project work, monitor and control project work, perform integrated change control, and close project or phase.
42
a
2-32 13-20 13-23
The greatest opportunity for any stakeholder to influence project outcomes is during the earliest stages of the project. The role of the sponsor is especially important in getting the project off to a successful start.
43
c
4-49
Identifying that changes are needed is a different process (integrated change control).
44
d
7-68
See other topics, payback period.
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53
Comprehensive Exam 1 No.
Answer
Slides
45
a
5-24 5-30
The scope statement is an agreement that documents what is contractually within scope. It also provides a foundation for future project decisions (slide 5-30).
46
b
7-42 to 7-57
See tool #1, earned value management. EVM does not directly address technical performance, however, it does provide information for choices a, c, and d.
47
c
5-36 5-39
See tool #1, decomposition. One guide is to decompose work to a level at which it can be accurately estimated.
48
d
5-36 5-39 5-40
See tool #1, decomposition. Decomposition improves ability to plan, manage, and control the project. One important use of the WBS is to improve estimates (slide 5-45).
49
a
8-18
See tool #3a, cause and effect diagram. You must be aware that a cause and effect diagram is also called an Ishikawa Diagram.
50
a
7-48
SPI = EV / PV. EV is 50% of $1,000,000 or $500,000. PV was given as $500,000. Therefore, the SPI is 1.0, indicating that you are exactly on schedule.
51
a
2-18
Also see the table in the reference manual on p. 2-6. The matrix structure provides more authority for project managers and, for its success, depends on the interaction between functional and project managers. This question relies a bit on common sense and basic logic.
52
d
11-3
Risk management involves identifying, analyzing, and responding to risk.
53
d
10-13 10-14
The headcount on the team changed as follows: started with eight, added one, and subtracted three. You ended up with 8+1-3 = 6 team members. The last wrinkle is whether you need to count yourself for communication purposes. PMI has asked questions where you had to add yourself to the numbers. Read the wording carefully and if you are unsure, try the numbers with you added and without you added and see which answers are there. In this case, if you add yourself, the total number of people is 7. Therefore, the number of channels is (7x6)/2 = 21 channels.
54
c
9-12
See tool #1, organization charts and position descriptions. The responsibility assignment matrix (also called simply responsibility matrix) identifies who is to do what. Also see p. 9-4 in the reference manual. The purpose of a responsibility matrix is to make sure work packages have owners and work “does not fall between the cracks”.
55
a
6-71 6-72
Basic logic. Reducing the critical path (the longest path) will always result in an earlier finish date.
56
a
6-76
See tool #7. The classic techniques for schedule compression are crashing and fast tracking.
57
c
11-23 11-31
The fundamental activity in qualitative or quantitative risk analysis is to estimate probability and impact for each potential risk event.
54
Note
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Comprehensive Exam 1 No.
Answer
Slides
Note
58
a
11-54
Contingent response strategies are response plans used only when specific events occur first.
59
a
12-67
Also see p. 12-20 in the reference manual: definition of specification.
60
b
6-76
See tool #7, schedule compression. Crashing and fast tracking are tools for reducing project duration.
61
a
12-33
See output #3, procurement documents.
62
a
12-31
See tools for Plan Procurement Management (make-or-buy analysis, expert judgment, market research, meetings).
63
b
9-12
See tool #1: To avoid confusion, a RACI chart should never show more than one person accountable for a given task.
64
b
9-41
The problem with smoothing is that the real issue is not solved and it re-emerges. The initial solution is only temporary.
65
a
5-32
Documented as part of the scope statement, assumptions are factors believed to be true (without any actual proof) so that planning can be completed.
66
b
11-52
See tool #1, strategies for negative risks.
67
b
12-13 12-15
Fixed price contracts require the seller/supplier to complete the work for the agreed amount of money, even if they lose money.
68
a
12-33
See output #3, procurement documents. Also see p. 12-7 in the reference manual. Purchase orders become enforceable agreements when the seller ships the item requested by the buyer.
69
c
2-18
See p. 2-6 in the reference manual: the strong matrix is the organizational structure with the unique advantages to meet the demands of complex projects with the need to involve people across multiple functions. Those words (complex with cross-functional effort) have been in the PMI history about matrix structures.
70
a
7-47 7-50
The CPI establishes the trend in project performance. That trend is then assumed to be true for the remaining work.
71
d
11-52
See tool #1, risk avoidance, adopt proven technical approaches.
72
d
9-40 to 9-42
Conflict resolution techniques include: problem solving/collaborating (confronting), compromising, smoothing, withdrawing, and forcing.
73
b
5-30
Estimating durations, developing the schedule, estimating costs, and identifying risks all have the scope statement and/or scope baseline as an input. While the HR plan does not have the scope statement as an input, you cannot plan for resources until you know what the work entails.
74
d
13-6
See important issues in stakeholder management, bullet #1.
75
a
9-41
See compromise. Thomas and Kilmann indicated that a possible outcome of compromise is a lose-lose stalemate if members of both parties see the compromise as a sell-out in which neither party got what they needed.
76
c
9-55
Delegating increases productivity and efficiency.
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55
Comprehensive Exam 1 No.
Answer
Slides
77
a
7-42 7-45
See tool #1, earned value management.
78
b
6-96
See output #1, work performance information. Choices a and d: Are about quality, not schedules. Choice c: Is used in estimating and planning, not in controlling.
79
b
5-3
Also see p. 5-1 in the reference manual. Bullets #1 and #2 address how product and project scope are measured (against the product requirements for the product scope and the project management plan for project scope).
80
a
2-31
Amount at stake is like the concept of sunk cost: The farther you have progressed into the project life cycle, the greater the cumulative investment will be at that point.
81
d
12-67
Also see p. 12-20 in the reference manual: Breach of contract.
82
c
11-61
See output #2, change requests, workaround.
83
a
8-16 8-19
See tool #3d, Pareto chart.
84
d
6-90
All changes follow the basic guidelines established by Perform Integrated Change Control. Schedule changes in particular would also follow Control Schedule guidelines.
85
d
11-4
Utility theory/function addresses an individual or organizations willingness to take risk in light of the reward that is available.
86
a
5-58
Scope changes are controlled through the process called Control Scope. See input #1, project management plan. The scope baseline is referenced here and includes choice b and choice d (the WBS is a major component of the scope baseline). Choice c is output #1, work performance information. The charter is not directly involved in controlling scope changes.
87
d
7-47 7-48
Schedule variance = BCWP-BCWS = 650,000-750,000 = -$100,000. Cost variance = BCWP-ACWP = 650,000-800,000 = -$150,000.
88
a
4-41
Change control operates as a subset of configuration management.
89
c
2-13
Portfolios contain programs and projects chosen to help attain organizational goals. Organizational governance and organizational project management are overall frameworks within which portfolios exist.
90
d
5-49
Validate Scope is concerned with reviewing work results, checking for correctness, and obtaining formal acceptance.
91
b
11-7 11-49
Risk response planning is aimed at reducing the downside threats or adverse events and enhancing the positive opportunities.
92
c
5-51
Validate scope determines whether work was completed correctly and should be accepted. Early termination is always a possibility and the extent of the work completed must be documented.
56
Note
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Comprehensive Exam 1 No.
Answer
Slides
Note
93
b
2-18
Also see p. 2-6 in the reference manual. Communication stands out as the primary issue. The matrix is believed to be the organizational structure with the most complex information flows. In a matrix, the project manager must work extensively with functional managers to get things done. Communication skills are paramount.
94
b
8-54
See ISO 9000/9001: Requires that an organization’s quality system conform to criteria established by the ISO 9000/9001 standards.
95
a
12-26
Under a CPPC contract, the buyer is required to cover valid costs and the seller’s fee actually increases as more money is expended. It is the worst contract arrangement for a buyer (from a cost and risk perspective).
96
d
4-27
See output #3, change requests. See the last bullet, which warns about such questions. Change requests should never be automatically accepted or rejected. You also never speak with other stakeholders before the integrated change control system has been followed. You must understand the potential impact of the change before discussing with other stakeholders.
97
b
12-16
If the scope cannot be described accurately and in some detail, fixed price contracts are dangerous and risky for a seller.
98
a
4-49
Administrative closure is a major part of closing a project or phase of a project. It requires disciplined archiving of important project records.
99
c
11-65
The probability that 2 independent events will both occur is determined by multiplying the two probabilities.
100
a
12-60
Both outputs to close procurements address the issue of ensuring that the work is complete and has been signed off/documented.
101
c
4-52
Also see pp. 4-19 & 20 in the reference manual. Historical data are used for estimating and planning future work that is similar in nature. Conflict resolution is the least likely of such information.
102
b
12-67
Also see p. 12-20 in the reference manual: warranty.
103
d
2-34
Also see p. 2-25 in the reference manual (Appendix II on international project management): The definition of culture shock. These questions have become less likely than they once were.
104
a
12-59
See tool #2, procurement negotiations: Provides a means to settle outstanding issues, claims, and disputes. This tool is part of Close Procurements.
105
b
8-3 to 8-6
Quality involves meeting project requirements. Customer satisfaction occurs when requirements are met and the product works properly in meeting the customer’s needs.
106
b
11-52
See tool #1. Developing an alternative solution is a form of avoiding risk. It is preferred over choices a and c which are ways to reduce scope (not a first resort). Choice d may not make sense or be acceptable to the customer.
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57
Comprehensive Exam 1 No.
Answer
Slides
107
a
12-68
Also see pp. 12-21 & 22 in the reference manual. Close Project or Phase documents completion of a project or phase and transfer of deliverables to customers/users. Close Procurements documents contract records and creates a complete, indexed set of contract documentation.
108
b
8-3
Grade is features and functions. Choosing a lower grade to save money is a perfectly acceptable decision. Low quality is never okay because it means you are not meeting requirements.
109
a
8-7
The question describes the exact definition of quality assurance.
110
c
2-10
Also see p. 2-2 in the reference manual. An additional characteristic of a project involves progressive elaboration which is also called rolling wave planning.
111
b
7-58
The 0:100 rule provides no credit for work completed until it is completely finished. Therefore, when reporting status, it is possible to get zero credit for a task that is actually 90% complete.
112
c
9-49
See Herzberg’s motivation model on hygiene factors.
113
b
11-22
Choice b: risks and triggers are not identified until after the risk management plan has already been completed.
114
a
2-27
As part of enterprise environmental factors, work authorization systems ensure the right work is done at the right time and in the right sequence. PMI has also used the word “sanctioning” the work (an alternate way of saying the work has been authorized).
115
c
2-20
See strong matrix. You have a lot of authority so you are either operating in a strong matrix or a projectized structure. It is strong matrix because your team members are borrowed from functional managers elsewhere in the organization.
116
c
10-16
In the basic communication model, information is transmitted using an appropriate medium.
117
b
7-19
Parametric estimates use a multiplier factor based on historical data. Examples are almost limitless: Cost per mile, dollars per square foot, dollars per pound, etc.
118
d
6-54
Also see p. 6-15, output #1, activity duration estimates. The estimates are assumed to be statistically independent (one estimate does not affect or determine the estimate for a different task).
119
d
6-71
See tool #2, critical path method. This question is about evaluating performance. You must know the status of the critical path and you must know the status of other project activities to draw any valid conclusions.
120
b
6-53
Duration estimates are basically how many time periods an activity will take (how many hours, days, etc).
121
c
13-20 13-21
See Plan Stakeholder Management, tool #3: Analytical techniques provides a classification model to monitor desired vs. current levels of stakeholder engagement.
58
Note
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Comprehensive Exam 1 No.
Answer
Slides
Note
122
a
9-46
Compromise and influencing are not sources of power. They are associated with conflict resolution and interpersonal skills, respectively.
123
b
9-42
See withdrawing (used when someone has become angry and you are concerned about damaging working relationships; take a break, calm down, and re-engage when everyone is ready.)
124
d
12-16 12-26
Cost reimbursement contracts are appropriate when the scope is difficult to define, risk is high, and costs are difficult to estimate accurately.
125
a
9-47
Choices b, c, and d are levels in Maslow’s Hierarchy of Needs. Expectancy is associated with a different theory: Vroom’s Expectancy Theory.
126
c
9-39
The top 4 sources of conflict, according to a PMI® survey, are (SPoRT) schedules, priorities, resource, and technical issues.
127
a
12-67
Also see p. 12-20 in the reference manual. Liquidated damages are included as a contractual clause that provides a specific penalty if certain conditions are not met. Often a dollars per day penalty for being late.
128
c
11-38
See expected monetary value. EMV is determined by multiplying the probability of an event by its estimated amount at stake.
129
c
11-37 11-38
Sensitivity analysis is often performed by employing a computer simulation. One possible advantage is to produce a distribution or range of possible outcomes.
130
c
4-49
Administrative closure must verify that the work is complete for that phase.
131
d
2-21
Also see p. 2-6 in the reference manual. The projectized structure is perfectly suited to a large, important project in which it is vital for the team to be highly focused and committed to the success of the project.
132
b
10-17
See sender responsibilities: information is clear and complete and confirm receiver’s understanding.
133
d
9-40
See problem solving/collaborating (confronting). PMI has historically endorsed problem solving/confronting as the preferred, most effective way to handle conflict.
134
d
9-54
See leadership styles: autocratic, laissez-faire, democratic.
135
b
12-31
See tool #1, make-or-buy analysis.
136
b
9-41
See smoothing: emphasizing and building upon areas of agreement; de-emphasizing areas of contention.
137
d
10-19
The pull form of communication allows people to access a large volume of information whenever they need it.
138
d
6-76
Crashing and fast tracking are the two classic methods suggested by PMI for getting the project done faster.
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59
Comprehensive Exam 1 No.
Answer
Slides
139
c
N/A
General knowledge.
140
c
4-43
See input #4, OPA, cost control procedures and guidelines. Integrated change control establishes the master plan for handling changes of any type.
141
c
2-8
Under the standards for fairness, you should never hire or fire on the basis of favoritism or nepotism.
142
b
9-12
Part of Plan Human Resource Management, a RACI chart should only designate one person as accountable for a task (to avoid confusion) and does not show timing of the work.
143
b
7-35
Statement ii is false, reserve is not intended for scope changes (work not originally authorized.)
144
c
11-38 11-41
See tool #2, expected monetary value. (.70x100,000) + (.30x80,000) = 70,000+24,000 = $94,000 profit.
145
c
6-28
Dummy tasks are required for arrow diagrams, but not for precedence diagrams.
146
b
2-5
The 4 obligations of the PMI® Code of Ethics and Professional Conduct are responsibility, respect, fairness, and honesty.
147
a
8-5 8-9
PMI has always endorsed up-front prevention and planning over inspection. Inspection does not improve quality, it simply stops defects from getting to the customer (hopefully).
148
a
13-12 13-13
The first tool in the process Identify Stakeholders is stakeholder analysis. It provides three steps to identify and prioritize the importance of various stakeholders.
149
b
9-50
See Victor Vroom’s motivation theory on expectancy.
150
d
9-39
Also see p. 9-15 in the reference manual: Bullet #3 at the top of the page states a PMI preference for the use of team building exercises to address conflict.
151
c
6-36 6-38
The forward pass yields a total duration of 20 based on the longest path: BCEG.
152
b
6-36 6-38
The longest path is BCEG, 20 days. It also has zero float.
153
b
6-38
Task D: early finish is 12 and late finish is 14. Float = LF-EF = 2 days.
154
a
6-39 6-46
EF for task A is 4 and ES for task C is 7. Therefore, task A can be delayed 3 days with no impact upon task C.
155
c
6-44
EF for task F is 12 because it is finish-to-finish with task D.
60
Note
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Comprehensive Exam 1 No.
Answer
Slides
Note
156
d
6-81 to 6-85
You must reduce the critical path by 3 days (and ensure that no other path emerges as the critical path). Task B is the cheapest crash cost and can be reduced by one day. Task C cannot be crashed. Task E is the next cheapest crash cost and can be crashed by one day. Finally, Task G is the most expensive crash cost and, while it can be crashed by 3 days, you only need 1 to meet the new schedule. So, you crash BEG and the new schedule becomes 17 days.
157
b
6-39 6-46
Free float is how long you can delay a task without delaying the start of the immediate successor task.
158
a
7-47
You must add the total for the PV, EV, and AC columns. Cost variance = EV-AC = 2500-2700 = -$200.
159
d
7-47 7-48
CV = -200 and SV = -400 (2500-2900). Negative variances are bad news. Cost overrun and behind schedule.
160
c
7-50
EAC (variances typical) = BAC/CPI. BAC = $3700 (add total PV column). CPI = EV/AC = 25/27 = .92592593. So, EAC = 3700/.92592593 = $3,996 (approximately $4,000).
161
a
7-47 7-48
CPI = .93 and SPI = EV/PV = 25/29 = .86. Cost is -7% on the low side (CPI of 1.0 would be exactly on track). However, SPI is .86 which is 14% off track and is outside the prescribed limit.
162
d
N/A
See p. 1-7 in the reference manual. The percent of the budget spent is given by AC/BAC = 2700/3700 = .73. The formula for percent spent is also on the color coded Formula and Process Guide.
163
d
6-40 6-41
Float = LF-EF. Task D has float of -5 (it is behind schedule.)
164
c
6-40
Task C has float of 4 and is the most float available.
165
d
6-38
The task with the least float is on the critical path (assuming there are no other paths with even less float.)
166
c
9-56
PMI recommends not delegating sensitive things like pay and hiring.
167
d
12-64
Decentralized procurement puts the procurement people on the individual project teams. This gives better responsiveness to project needs but makes it harder for procurement specialists to support each other and share knowledge.
168
d
2-19 to 2-22
Also see pp. 2-5 & 6 in the reference manual: Functional silos are the least appropriate style for managing multiple projects, especially if they involve cross-functional expertise. Matrix management works much better for projects requiring cross-disciplinary cooperation, which is exactly where functional stovepipes run into trouble.
169
a
9-15
Training needs are first mentioned as part of the staffing management plan.
170
c
12-31
See tool #1, make-or-buy analysis. Choice a: an output, not a tool. Choice b: a tool for conduct procurements. Choice d: an output, not a tool.
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61
Comprehensive Exam 1 No.
Answer
Slides
Note
171
c
5-40 5-41
See Create WBS. Only choices c and d are possible answers (lowest level is work package.) Choice c is correct; choice d (primary stakeholder is not a formal characteristic.)
172
d
4-8 4-9
Choices a through c are all accomplished later in the planning process.
173
c
12-67
See p. 12-20 in the reference manual. If a project manager accepts defective work and fails to demand correction, the concept of waiver excuses the contractor from meeting standards of performance.
174
a
2-20
Also see p. 2-6 in the reference manual. An advantage of the matrix structure is the opportunity for time sharing of critical resources. Therefore, it is possible to more easily handle multiple projects without tying anyone up full-time on a single project. Choices b and d are not necessarily true in any given situation. Choice c is referring to the projectized structure.
175
b
9-54
See leadership styles, laissez-faire. This approach is a natural fit when working with high-knowledge experts who do not need or appreciate being closely managed (micromanaged).
176
a
9-30
The Tuckman model identifies stages that teams experience as they begin working together.
177
c
8-15 8-18
See tool #3a. Ishikawa Diagram is another name for a cause and effect diagram.
178
d
9-41
Also see p. 9-15 in the reference manual. Compromise represents a back-up approach if powerful parties need some sort of solution quickly. Thomas and Kilmann warned that this can, in some cases, result in a lose-lose outcome.
179
a
8-11
See input #3.
180
d
9-25 9-35
Ground rules is a tool for develop the team, not manage the team.
181
b
12-22
PTA = [(Ceiling price-Target price)/Buyer share] + Target cost = [(150-120)/.75] + 100 = (30/.75) + 100 = $140 mil. Note: Target price is 120 mil (not 100 mil).
182
c
12-23
This type of question is worked most easily as a series of 3 steps: 1. Calculate fee adjustment = (Target cost-Actual cost) x Seller share = (100-80) x .25 = +$5 mil. 2. Calculate actual fee = Target fee + Fee adjustment = 20 + 5 = $25 mil. 3. Calculate contract price = Actual cost + Actual Fee = 80 + 25 = $105 mil.
183
b
12-23
Same 3 steps: 1. Fee adjustment = (100-120) x .25 = -$5 mil. 2. Actual fee = 20 – 5 = $15 mil. 3. Price = 120 + 15 = $135 mil. Step 2 calculated the seller’s profit at $15 mil.
184
d
12-20
Same 3 steps: 1. Fee adjustment = (100-116) x .50 = -$8 mil. 2. Actual fee = 25 – 8 = $17 mil. 3. Price = 116 + 17 = $133 mil.
185
a
7-47
CPI = EV/AC. So, .94 = EV/50,000. EV = .94 x 50,000 = $47,000. Questions 185 and 186 are algebra tricks.
62
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Comprehensive Exam 1 No.
Answer
Slides
Note
186
c
7-50
EAC = BAC/CPI. So, $319,148.94 = BAC/.94. BAC = .94 x 319,148.94 = $300,000.
187
b
11-37
Tool #2, bullet #1, sensitivity analysis, tornado diagram.
188
a
6-80
PERT stands for Program Evaluation and Review Technique. Used when work is uncertain and a range of estimates is better than a single estimate.
189
c
7-11
Also see Unit 15 in the reference manual: Contains various exercises on potential math questions. One of those is how to evaluate lease vs. rent scenarios. In this case: 160 X = 3200 + 80 X, where X = days. 80 X = 3200. X = 40 days.
190
d
12-54
Choices a and b are tools. Choice c is an input.
191
b
12-67
Also see p. 12-20 in the reference manual for the definition of specification.
192
c
7-14
See range of accuracy for a budget estimate. The range provided in the question is -10% to +25%.
193
d
6-36 6-37
The critical path is ADE with a duration of 22 days. Late finishes (backward pass) are: A = 8, B = 15, C = 22, D = 8, and E = 22.
194
a
7-78
See value engineering (a legitimate technique for reducing costs). Choice b is questionable if not unethical and/or illegal. Choice c could backfire and would be unethical if you promised experienced staff in your proposal. Choice d would actually increase costs.
195
b
6-101
See other topics, GERT.
196
c
7-14
See order of magnitude estimates.
197
d
2-13
See portfolios. Portfolio management links the objectives of projects and programs to the strategic objectives of the organization.
198
b
9-51
See the motivation theory on McClelland’s Trichotomy of Needs (also called Needs-Achievement Index.)
199
c
9-53
Judging people are planned and orderly. They take deadlines very seriously. What matters is finishing tasks. Perceiving people are spontaneous and flexible. They love to start new tasks but often let deadlines slip and change.
200
a
7-47 7-48
You have a cost overrun (CPI less than one) and are behind schedule (SPI less than one.) Choice a: logical explanation for being behind schedule. Choice b: you have a cost overrun (the cost of fuel decreasing would not cause that result.) Choice c: you have no reference for how long it was supposed to take for the concrete to cure (therefore, you cannot interpret this choice accurately.) Choice d: has no direct link to performance on a specific project.
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63
Comprehensive Exam #2 1. A fellow project manager just suggested that you do some reading on the use of PERT as one possible way to evaluate the uncertainty in the risk on your upcoming development project. Which of the following is an advantage of PERT? a. b. c. d.
It tends to produce more optimistic schedules. It can evaluate the effect of loops and conditional branches in the work. It allows the use of dummy tasks. It can help identify schedule risk.
2. Which of the following is not a tool of Close Procurements? a. b. c. d.
Procurement audits Expert judgment Procurement negotiations Records management system
3. You were just placed in charge of a sub-project consisting of five tasks. Tasks A, B, and C are to be performed in sequence with finish-to-start dependencies. They have durations of 4, 6, and 2 days respectively. Task D has a finish-to-finish dependency with Task A (Task A is the predecessor), and Task D has a duration of four days. Task E has a finish-to-start dependency with D. Task E has a duration of seven days. You were also informed that resource estimates for all five tasks have been completed and confirmed. What is the next step that must be completed to establish a schedule baseline? a. b. c. d.
develop schedule resource leveling what-if scenario analysis control schedule
4. You were recently contrasting the behavior of two key team members with a colleague. One person prefers to work alone and seems to need breaks from large groups to recover his energy. The other prefers to work in groups and seems to draw enthusiasm and energy from being with others. Your colleague commented that this situation is in line with research on the ______. a. b. c. d.
Vroom Expectancy Theory Maslow Hierarchy of Needs Model Myers-Briggs Type Indicator Herzberg Hygiene-Motivator Model
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1
Comprehensive Exam 2
5. You are sharing project management responsibilities with the designated project managers from five other countries. The project is developing remediation processes for the improved quality of public drinking water. Water quality is a growing concern and the PMs are meeting next week in Geneva to negotiate an agreement about key technological approaches for the next phase of the project. The United States and one European country favor the use of electro-hyperstasis as the cornerstone technology. However, another European country as well as countries in Africa and Asia favor a different approach. There have already been heated disagreements that threaten to disrupt the partnership. Your boss has suggested that you do your best to focus on areas in which there is general agreement, and try to de-emphasize the contentious subjects. Which conflict management technique is your boss suggesting? a. b. c. d.
problem solving smoothing compromise withdrawal
6. Risk has been defined as an uncertain event that, should it actually occur, may have a positive or a negative effect on the project outcome. Which of the following concepts describes the amount of risk that an organization is willing to accept when evaluated against the potential reward? a. b. c. d.
utility function expected monetary value contingent value analysis sensitivity analysis
7. Supporting the Close Project process, Close Procurements verifies that all work and deliverables were acceptable. It also involves administrative record-keeping activities. Which of the following are inputs to Close Procurements? a. b. c. d.
project management plan and procurement documents procurement audits and procurement documentation closed procurements and organizational process assets updates contract file and lessons learned documentation
8. The initiating steps of the City Center Renovation project were completed last week and approval to enter the planning phase has been received. The core project team has, accordingly, grown from 10 members to 15 members. As the newly appointed project manager, how many communication channels must be managed? a. b. c. d.
2
10 15 60 105
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Comprehensive Exam 2
9. One process on your Shopping Mall Update project must produce bulbs for neon signs with illumination of 1100 lumens. The customer has specified that the lumens may vary from 1060 lumens (LSL) to 1140 lumens (USL). Your process has historically produced output varying from 1050 lumens (LCL) to 1150 lumens (UCL). The first 500 bulbs were measured as follows: Number of Bulbs 2 30 30 50 53 100 65 95 60 10 5
Lumens 1160 1145 1140 1120 1110 1100 1095 1080 1060 1055 1050
Which of the following statements is not true? a. The data show 2 special causes which should be investigated. b. You have produced 45 outcomes that do not meet customer requirements but are considered normal for your current process. c. Your process typically produces outcomes that result in rework or scrap. d. Your process meets customer requirements. 10. You are compiling this month’s status report. The CPI is 0.80, the actual costs are $1,250, and the budget at completion is $5,000. What percent of the work is complete? a. b. c. d.
80% 25% 20% cannot be determined from the information given
11. You have negotiated a fixed price incentive fee contract with the following terms. The ceiling price is set at $200,000; the share ratio is 80 / 20, the target cost is $120,000, and the target profit is $40,000. What is the point of total assumption? a. b. c. d.
$320,000 $220,000 $200,000 $170,000
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3
Comprehensive Exam 2
12. Using the data from question #11, if the contractor’s actual final cost was $150,000, what price would the customer pay? a. b. c. d.
$190,000 $184,000 $166,000 cannot be determined from the information given
13. You have decided to rank project stakeholders using a power/interest grid. For stakeholders who are rated as high in power and high in interest, you should handle them by ______. a. b. c. d.
keeping them informed monitoring them keeping them satisfied managing them closely
14. You are negotiating an agreement that has become a bit contentious and have discussed the possibility of using the conflict method of forcing to handle the situation. However, one of your trusted advisors has warned you that the other party may have more power than you thought. You have accordingly become concerned that your negotiation could run into the problem of ________. a. b. c. d.
a stalemate negative publicity not adequately thinking of all of the relevant issues failure to consider lessons learned
15. You are making an annual purchase of pencils, paper, and notebooks for employees at your company and price is the primary concern. Which procurement document would be most appropriate for this purchase? a. b. c. d.
RFP Unilateral purchase order IFB RFQ
16. Tasks A, B, and C have durations of 12, 8, and 10 days respectively. They are performed in sequence (A, then B, and then C) and have float of zero days. Tasks A and D have a finish-to-finish dependency. Task D has a duration of 6 days. What is the float, early finish, and late finish for Task D? a. b. c. d.
4
float = 0, early finish = 6, late finish = 6 float = 24, early finish = 6, late finish = 30 float = 18, early finish = 12, late finish = 30 cannot be determined from the information given
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Comprehensive Exam 2
17. You are in the planning phase of a project to improve traffic flow and safety for the city of Austin, Texas. You have established ballpark cost and schedule estimates and are now considering risk issues. Your team has identified its initial concerns and analyzed the probability and impact of these potential risk events. As you determine possible risk response strategies, which of the following is not a strategy for negative risks? a. b. c. d.
exploit avoid accept transfer
18. Which of the types of contracts has a ceiling price, share ratio, target cost, target fee, and point of total assumption? a. b. c. d.
FPIF CPIF FPFF CPFF
19. You have decided to employ the risk response strategy of transferring or deflecting the risk. Which of the following choices is a method for transferring the risk (having another party handle the problem)? a. b. c. d.
adopting a less complex approach insurance change project objectives conduct more tests
20. You must arrange for specialized engineering support services for your project. You know that professional services are often provided at a specified monetary rate per hour, however, you are not sure how many hours of support will be needed. Which type of contract is appropriate for this situation? a. b. c. d.
Cost plus award fee Cost plus incentive fee Time and material Cost plus percentage of cost
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5
Comprehensive Exam 2
21. You are planning the communication processes for a new product development project that begins in two weeks. Which of the following would not be a tool of Plan Communications Management? a. b. c. d.
communication technology information management systems communication methods meetings
22. During a meeting with key stakeholders, you discuss quality requirements for an upcoming project. One participant suggests a strategy that calls for providing a solution that surpasses the customer’s requirements. This practice is called _____ and is considered _____. a. quality improvement; a good practice because it positions your organization as a better value than the competition b. quality improvement; a bad practice because it needlessly increases costs c. goldplating; a good practice because it positions your organization as a better value than the competition d. goldplating; a bad practice because it needlessly increases costs 23. You recently began a six-month upgrade project for the communication system at the Mirage Hotel in Las Vegas. The status report at the end of the third month revealed the following data: the original budget was $2 million, the current earned value is $800,000, the money spent thus far is $1 million, and the planned amount of work after three months was $1.1 million. What is the cost variance and its meaning? a. b. c. d.
-$300,000; cost underrun -$300,000; cost overrun -$200,000; cost underrun -$200,000; cost overrun
24. Using the data from question #23, what is the estimate at completion? Previous experience has shown that cost performance does not change significantly after the first 15 to 20 percent of the work is completed. a. b. c. d.
6
$1,600,000 $2,500,000 $2,750,000 cannot be determined from the data given
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Comprehensive Exam 2
25. Your team has created a requirements management plan and a written scope statement that has been coordinated with the customer and key stakeholders. What is the next major scope management step that your project team must perform? a. b. c. d.
Collect requirements Create WBS Validate scope Control scope
26. You have completed the cost estimating process using the bottom-up method. What is the next major cost management step and what is the primary output for that step? a. b. c. d.
determine budget; cost performance baseline control costs; cost baseline updates performance measurement analysis; corrective action project funding requirements; cost aggregation
27. Your project has numerous repetitive processes and you are monitoring process outcomes using control charts. In looking at the latest report, you find that three outcomes were above your upper control limit (UCL). This outcome is called ________ and must be ________? a. b. c. d.
a rule of seven incident; reported a violation of the USL; corrected a special or assignable cause; investigated a special or assignable cause; documented as a lesson learned
28. Your team of six experts is evaluating the advisability of a particular communications technology project. Other teams are evaluating alternative projects. Your team has agreed that there is a 60% chance of earning a $10 million profit, a 20% chance of earning a $5 million profit, and a 20% chance of incurring a $2 million profit. What is the expected monetary value of this project? a. b. c. d.
$17,000,000 profit $10,000,000 profit $7,400,000 profit cannot be determined from the data given
29. Managing the project team includes tracking team performance, providing feedback, resolving issues, and coordinating changes. Which of the following is a tool of managing the project team? a. b. c. d.
project staff assignments work performance reports human resource management plan conflict management
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Comprehensive Exam 2
30. Which human resource concept suggests that people are basically lazy and must be managed with strong controls or they will surf the internet all day? a. b. c. d.
McGregor’s Theory X Ouchi’s Theory Z Goldratt’s Theory of Constraints Vroom’s Expectancy Theory
31. The PMBOK® Guide includes two processes for closing out work. Close project is part of integration management and close procurements is part of procurement management. Which of the following is an output that is common to both close project and close procurements? a. b. c. d.
procurement audits organizational process assets updates closed procurements final product transition
32. A portion of the work on your project to update the security system for a major bank involves work that is uncertain and difficult to estimate. You have decided to try the use of PERT to get a better idea of the range of possible durations for this work. Accordingly, you have asked several experts to come up with three estimates (best case, worst case, and most likely). The estimates they provided were 7 days, 19 days, and 10 days respectively. Using PERT, what is the expected average duration for this work? a. b. c. d.
10 days 11 days 12 days PERT is not used for this type of estimating
33. Which of the following is not a tool of Control Quality? a. b. c. d.
control charts scatter diagram inspection deliverables
34. Which of the following would not be an activity performed during the closing of a project? a. b. c. d.
8
ensure that the right work is done at the right time document project deliverables formalize acceptance of project deliverables document the reasons if a project is terminated before completion
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Comprehensive Exam 2
35. Organizational structures do not always confer sufficient power and authority on project managers. Which of the following are considered potential sources of power for a project manager? a. b. c. d.
formal, reward, and laissez-faire self-esteem, reward, and penalty expert, reward, and referent laissez-faire, expert, and referent
36. You have produced a written, detailed scope statement and have started the next step, which is to create a WBS. Which of the following is a tool for creating the WBS? a. b. c. d.
requirements documentation scope baseline scope statement updates decomposition
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Comprehensive Exam 2
Note: Use the following figure to answer questions 37 through 40.
Figure 1: Schedule
A 4d
E 3d
C 3d
G 6d
Start
B 9d
End
D 5d
F 7d
© C. Michael Farr
37. What are the late finish times for Tasks B and D? a. b. c. d.
10 and 16 10 and 14 9 and 14 9 and 16
38. What is the expected duration of the project and which tasks are on the critical path? a. b. c. d.
27 days; B, D, F, G 21 days; B, C, E, G 21 days; A, C, E, G 22 days; B, D, F, G
39. Which activity has free float? a. b. c. d.
10
C A G B
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Comprehensive Exam 2
40. What is the float for Task A? a. b. c. d.
one day six days zero days five days
41. Communications planning should be done early in the project life cycle and should be reviewed on a regular basis. What is one of the most important factors in the Plan Communications Management process? a. b. c. d.
stakeholder information needs SWOT analysis performance reporting communication skills
42. Project management processes are organized into five process groups. They are fundamental building blocks in the conduct of project management. Which of the following statements about process groups is incorrect? a. The process groups occur in all phases of a project. b. Process groups may be iterative in that feedback may cause certain process groups, or portions thereof, to be repeated. c. One of the process groups is monitoring and controlling. d. One of the process groups is directing. 43. Having completed the requirements management plan and published the requirements documentation, your next step is Define Scope. What are the four tools of Define Scope? a. expert judgment, product analysis, alternatives generation, facilitated workshops b. organizational process assets, project charter, product analysis, expert judgment c. expert judgment, WBS, scope validation, scope management plan updates d. product analysis, scope validation, scope management plan updates, recommended corrective actions
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Comprehensive Exam 2
44. Your team is identifying potential risks for your pharmaceutical development project. Because of the large investment in this project, you have also involved a few outside experts. Which technique will ensure that no particular expert will dominate the thinking of the group? a. b. c. d.
brainstorming root cause analysis Delphi technique SWOT analysis
45. You are in the process of choosing quality control tools for the next phase of your project. One tool is a chart with vertical bars showing the various sources of defects. The tallest bar is displayed on the left and the height of the bars descends in order toward the right side of the chart. This tool is called a ___________ and is used to __________. a. run chart; plot data points as they occur and discover any trends that might be present b. control chart; display process results and determine whether the process is under control c. cause and effect diagram; determine the possible causes for specific problems d. Pareto chart; guide corrective action to the most productive areas for improvement 46. One of your team members, a veteran project warrior, noted in a recent conversation that he believes people are motivated when they believe that success is both feasible and rewarded. What motivation theory was he describing? a. b. c. d.
Vroom’s expectancy theory Herzberg’s hygiene factors Maslow’s hierarchy of needs No formal theory exists for this common sense notion
47. Communication and the management of information is believed to consume as much as 90% of a project manager’s time. Which of the following statements about communication is true? i. The presence of communication barriers may increase the chance of conflict. ii. Formal communication is more important than informal communication. iii. Listening, feedback, and building consensus are legitimate aspects of communication. a. b. c. d.
12
i and ii ii and iii i and iii i, ii, and iii
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Comprehensive Exam 2
48. Based on the data provided below, which activity should you crash first? Tasks A, C, and E are on the critical path. Task A B C D E
a. b. c. d.
Normal Time 4 days 6 days 3 days 5 days 4 days
Crash Time 2 days 5 days 3 days 3 days 2 days
Crash Cost per Day $200 $150 $100 $160 $175
Task C Task E Task B Task D
49. As one of the tools for Control Risks, reserve analysis _____. a. considers whether a sufficient amount of reserve is left to cover the remaining risk b. determines whether reserve should be incorporated in the baseline or held as a separate amount c. evaluates the requests of project teams to use portions of the existing reserve d. is used as an input to trend analysis 50. While it has a negative connotation to some people, whistle-blowing is one way to report perceived violations of the code of conduct. Whistle-blowing may be necessary when others are reluctant to deal with a serious violation. For example, two workers on a facilities project accidentally uncovered several barrels containing hazardous waste materials on a Friday afternoon. They did not recognize the material until they had opened the barrels and spilled some of the materials on themselves. They replaced the barrels, cleaned themselves up using faucets at a nearby picnic area, but did not share the information with anyone else until the following Monday morning. During the weekend, a troop of girl scouts used the picnic area for a campsite. You just heard this information and you know that no one in upper management is aware of the incident. You should _____. a. b. c. d.
leak the report to the local newspapers secretly record a meeting held to discuss the matter do nothing; there will probably be no harm to anyone report the incident to management
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Comprehensive Exam 2
51. During a project selection session, your group of experts has determined the following information for two potential projects. Which project is better from a financial perspective? Benefit cost ratio Net present value Internal rate of return
Project A 1.5 $500,000 15%
Project B 2.0 $450,000 22%
Note: The company hurdle rate for IRR is 20%. a. b. c. d.
Project A Project B Either project is okay You cannot adequately compare the projects with this data
52. Based on the planned schedule reflected by the data in the table below, how much free float is on the critical path? Task
Predecessor
Dependency
Duration
A B C D E F G
Start A Start C B D E, F
FS SS FS FF FF FS FS
5 days 4 days 5 days 6 days 3 days 5 days 7 days
a. b. c. d.
zero days one day two days insufficient information to answer the question
53. One of two initiating processes for projects, a project charter is a written document that authorizes a new project. Which of the following statements about the project charter is true? i. The charter leads to the assignment of a project manager; the PM should never be assigned later than the start of project execution. ii. The charter is usually developed and distributed as part of the planning phase. iii. Expert judgment is an input to developing the project charter. a. b. c. d.
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i and ii ii and iii i and iii none of the above statements are true
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Comprehensive Exam 2
54. Insurance is a risk ______ strategy? a. b. c. d.
mitigation enhancing transfer avoidance
55. Activity definition is an essential first step in building an accurate project schedule. If the activity list is inaccurate, then the schedule will also be inaccurate. Which of the following is an output of Define Activities? a. b. c. d.
milestone list decomposition activity list updates activity dependencies
56. A fundamental principle of modern quality management holds that prevention of defects is more important than inspection. Therefore, high quality is most likely to be achieved by _______. a. b. c. d.
careful control of the costs of non-conformance effective quality planning developing prestigious products effective use of benchmarking
57. You have awarded a contract to Digitizer, Inc. to develop a key component of a new electronic product. Digitizer has, in turn, awarded a contract to Collectimizer, Inc. for a portion of Digitizer’s scope of work. Problems have arisen with the quality of Collectimizer’s work. In accordance with the concept of privity, you should ______. a. b. c. d.
work directly with Collectimizer; your privity with Digitizer applies work with both organizations; you have privity with both work with Digitizer to solve the problem; you have no privity with Collectimizer you have no legal recourse in this matter
58. The cost of quality (COQ) includes which of the following? a. b. c. d.
conformance and nonconformance inspection and rework administrative and project performance productive and nonproductive
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Comprehensive Exam 2
59. Recalls, warranty work, and lost business are examples of ______ costs. a. b. c. d.
internal failure external failure appraisal prevention
60. You are working on the highly touted Star Gazer III program. Now in its second year, the 50-person project team has been unusually diligent about risk management because of the enormous investment and the inherent uncertainty of the project. Murphy’s Law (anything that can go wrong will go wrong) has just struck again in that one of your initially rated low risks has actually occurred. Your initial response strategy for that risk was to accept it and so no response plan was created. Now that the risk has occurred, you analyzed the situation and have created a plan for dealing with the risk. The plan you created is called a ________. a. b. c. d.
contingency plan contingent response plan secondary risk plan workaround
61. Incentive contracts are designed to bring the objectives of contractors in line with the objectives of the customers. For instance, in a Fixed Price Incentive Fee contract, the contractor’s profit goes up if they can perform below the target cost. The buyer’s overall price also goes down and both parties are better off. Which characteristic is not common to both FPIF and CPIF contracts? a. b. c. d.
point of total assumption share ratio ceiling price target cost
62. You are have entered the early stages of planning and have asked for a cost estimate to help establish the proper level of funding. This type of estimate is referred to as a ______ and has a range of accuracy of ______. a. b. c. d.
16
order of magnitude estimate; -25 to +25 percent analogous estimate; -50 to +75 percent budget estimate; -10 to +25 percent definitive estimate; -5 to +10 percent
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Comprehensive Exam 2
63. Maslow’s Hierarchy of Needs contends that if certain lower-level needs are not satisfied, then people will not be as concerned about the higher-level needs. According to Maslow, what is the highest-level need that a human being can aspire to? a. b. c. d.
self-esteem expectancy early promotion self-actualization
64. A major milestone in your international project requires that you deliver an oral presentation to the project steering committee in Vienna on March 15th. As part of the project plan, failure to deliver this presentation on time was assumed to mean that performance was not as required. Therefore, a financial penalty of $150,000 would be imposed. Volcanic ash caused cancellation of all flights beginning 3 days before the meeting and extending through 2 days after the meeting. Your absence is ________. a. b. c. d.
not excused because the contractual requirement take precedence excused because of the concept of privity excused because of the concept of force majeure excused because of the concept of liquidated damages
65. In one portion of your project schedule, Tasks A, B, and C are performed in parallel and are also all predecessors of Task D. The schedule for this part of the work is uncertain and you decided to develop some probability data to support a simulation of the project. Your experts agree that the respective probabilities that Tasks A, B, and C will each finish on time are 50%, 80%, and 70%. What is the probability that Task D will start on time? a. b. c. d.
80% 50% 28% cannot be determined from the information given
66. Which of the following is not an advantage of verbal communication? a. b. c. d.
It is relatively fast. An audit trail is available for your records. It supports the brainstorming needed to solve complex problems. An immediate opportunity exists for feedback and clarification.
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Comprehensive Exam 2
67. Your experience and training have taught you that identifying the critical path is crucial for establishing accurate expectations about schedule outcomes. Which is the most correct statement about the critical path? a. b. c. d.
The critical path is the shortest path through the project network. The critical path marks activities of greatest importance to stakeholders. The critical path has zero float. The critical path has the least float available.
68. As an experienced and respected staff member at a small university, you have been selected to negotiate an agreement with a disorderly fraternity. The fraternity is currently on double-secret academic probation and has caused a multitude of problems for the school. However, your boss wishes to avoid problems with the large and wellregarded national chapter. Accordingly, she has asked you to work through any hard feelings and build commitment for a consensus solution. The conflict resolution technique that must be employed here is __________. a. b. c. d.
forcing compromise smoothing problem solving
69. You wish to establish a management system for auditing quality requirements, reviewing organizational processes, and capturing quality results. You are performing actions associated with ________. a. b. c. d.
quality planning quality assurance quality improvement quality control
70. You want to become more statistically sophisticated in the quality management area. One capability you would like to add is to use statistical data to predict (and improve) various quality metrics such as defect rate. A colleague told you about a technique that plots data on a diagram with a dependent variable on the vertical axis and an independent variable on the horizontal axis. This technique is called a ______ and is part of ________. a. b. c. d.
18
scatter diagram; plan quality management control chart; plan quality management run chart; control quality pareto chart; control quality
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Comprehensive Exam 2
71. Disagreements and conflict have become an increasing problem among the stakeholders involved in your array of electronic communication projects. You are trying to understand the source and cause of these conflicts. One of the stakeholders insists that disagreements about cost are always a “top four” problem. According to PMI data on that subject, what are the top four most likely sources of conflict? a. b. c. d.
Schedules, priorities, resources, and technical opinions Personalities, technical opinions, resources, and costs Costs, personalities, priorities, and resources Resources, priorities, schedules, and technical opinions
72. You are involved in a highly secret research project about the effect of sound on human performance. Some original conceptual development was funded by government agencies such as No Such Agency (NSA) and Characters In Action (CIA). At the last project meeting, held at a secret location, reliable information was presented warning that a competitor was nearing completion of similar work. Suddenly, the schedule has become of paramount importance. You were forced to remind the team that the project was originally planned using limited resources (controlling costs as well as limiting how many people knew about the project). Now that you are racing toward a faster completion, you desperately need to compress the original resource-leveled schedule. You are told by upper management that, at this point, cost is not an issue. You must get the work completed first. Which of the following tools would you use to aggressively compress the schedule? a. b. c. d.
fast tracking crashing and fast tracking resource reallocation reward and recognition system
73. Scope management should ensure that a project management plan includes all the work required, but only the work required to complete the project successfully. This planning must include both product scope (the features and functions embodied in the product or service) and project scope (the management activities required to deliver the product or service). Product scope should be measured against the ________ and project scope should be measured against the ________. a. b. c. d.
statement of work; WBS project management plan; product requirements WBS; project charter product requirements; project management plan
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Comprehensive Exam 2
74. Your most important stakeholders have emphasized control of cost overruns. You wish to know the magnitude of any expected final cost overrun. Which earned value formula would provide such information? a. b. c. d.
Estimate at Completion Variance at Completion Estimate to Complete Cost Performance Index
75. Conflict management is one of the important tools used by the process called Manage Project Team. A certain amount of conflict may be helpful in identifying and resolving important issues. However, conflict may also get out of control and do substantial harm to a project. Which of the following are conflict resolution techniques? a. b. c. d.
negotiate, compromise, withdraw, force negotiate, command, compromise, smooth confront, compromise, smooth, and force compromise, smooth, reward, and force
76. As part of scope management, Create WBS helps to organize and define the total scope of a project. Most experienced project managers have learned that the WBS is the foundation of an accurate, comprehensive project management plan. The WBS _________. a. decomposes work to a level at which accurate estimates can be established b. breaks work into smaller, more manageable components using a tool called subdivision c. shows the lowest level of detail needed for an accurate plan using planning packages d. uses a numbering system based on the hierarchy of accounts 77. One output of risk identification is the development of appropriate risk triggers. A risk trigger is ________. a. b. c. d.
20
the primary cause of a potential risk event a warning sign that a risk is about to occur a mitigation plan a secondary or residual risk
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Comprehensive Exam 2
78. Integrated change control recognizes that projects always evolve and change. There must be a system that accommodates but controls these changes, i.e., all changes must be managed using a consistent process. Change control must ________. a. allow informal changes to be accommodated b. allow baselines to remain flexible c. provide effective communication so that stakeholders are aware of all changes d. operate with one change control board 79. When selecting the appropriate type of contract, an important issue is which party will bear most of the risk. If you are the buyer, which contract places the most risk on your contractor? a. b. c. d.
cost plus fixed fee cost plus incentive fee fixed price incentive fee firm fixed price
80. Quality assurance is a classic quality management process that involves ______. a. identifying which quality standards are relevant to the project and determining how to satisfy them b. auditing quality requirements and results from quality control measurements to ensure appropriate quality standards are used c. monitoring specific project results to determine whether they comply with relevant quality standards and eliminating unsatisfactory results d. determining whether project processes are under control 81. After creating your communication management plan, your next step is Manage Communications. Which of the following is an output of Manage Communications? a. b. c. d.
project communications communication technology performance reporting work performance information
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Comprehensive Exam 2
82. A contractor is building a temporary classroom that will add 5,000 square feet of usable teaching space. The contractor estimated that each 500 square feet would require 20 hours of work. The contractor is paid $85 per hour, has completed 2,000 square feet of the work, and has spent $8,000. The original plan required 2,500 square feet to be completed at this point. Using earned value analysis, what is the current cost variance? a. b. c. d.
minus $1,200 plus $1,200 minus $1,700 cannot be determined from the information given
83. You are preparing for a $50 million project that will develop a new technology and involve numerous contractors. Which procurement document would be most appropriate in this situation? a. b. c. d.
request for quotation request for proposal request for information invitation for bid
84. Successful quality management often involves intricate trade-offs regarding issues such as grade, goldplating, and defining how quality will be measured. Which statement about quality management is correct? a. Quality is measured by the features and functions inherent in the product. b. A successful project requires high quality and high grade. c. Quality is defined as the extent to which characteristics inherent in a product exceed requirements. d. Low quality is always a problem, but low grade may not be. 85. One suggestion for improving communication on a project team is the use of a tight matrix. A tight matrix involves physical colocation of the team. Which is not an advantage of a tight matrix? a. b. c. d.
22
enhances working relationships speeds communication and improves decision making makes meetings more effective minimizes distractions
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Comprehensive Exam 2
86. A project management colleague is asking advice about a risk tool that she just heard about. She shows you a diagram with a square box on the far left and two lines branching out to the right. Each line leads to a circle and there are multiple branches to the right from each circle. This tool is a ________ and is used when ________. a. SWOT chart; you need to show the relationships and trade-offs between strengths and weaknesses on a project b. risk breakdown structure; you need to search for possible patterns in the risk events c. path convergence; you need to show the risks in various work flows d. decision tree; you need to evaluate potential risk event interdependencies 87. Validate Scope is the process of obtaining formal acceptance of project work. It involves reviewing work results and must still be accomplished even if a project is terminated early. Scope validation is considered part of the ________ process group. a. b. c. d.
planning executing monitoring and controlling closing
88. Quality control involves monitoring specific project results to determine whether they conform to requirements. Control charts are often used to help accomplish this task. With respect to control charts, what does the term tolerance refer to? a. A tolerance is specified by the customer and represents the range of variation that the customer will accept. b. A tolerance is an unusual event that may indicate that something is wrong with the process being evaluated. c. A tolerance measures how much variation the process normally produces. d. A tolerance is a method for determining where most of your defects are coming from. 89. Performance reporting involves collecting, analyzing, and disseminating performance information to appropriate stakeholders. This reporting is often done on an exception basis to focus attention on the most important information. Which of the following is not a type of performance report? a. b. c. d.
status report progress report work performance information forecast
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Comprehensive Exam 2
90. You are four months into a project to develop an emerging technology. There was some dissent when this particular approach was chosen and, unfortunately, it is now time for some of the company’s managers to say “I told you so”. The technology is not performing well and the costs are higher than expected. The company has already spent $5 million on the effort that was scheduled to take a year. The money that has already been spent is called ________ and should ________ when deciding whether to continue the project or terminate it. a. b. c. d.
sunk cost; be ignored sunk cost; be considered allocated cost; be ignored allocated cost; be considered
91. Your company just successfully completed exploratory research on the potential use of eye drops as a substitute for contact lenses. You now wish to move forward with applied research to actually develop this product for the marketplace. Which type of contract would be most appropriate? a. b. c. d.
CPFF CPIF FPIF FP-EPA
92. Many successful companies (including General Electric, Motorola, and Johnson & Johnson) manage quality using the concept of standard deviation. Many of these companies provide green belt and black belt training for carefully chosen employees. This modern concept attempts to engineer processes to limit defects to a low rate. The concept is called ________ and attempts to create outcomes that meet requirements ________ percent of the time. a. b. c. d.
two sigma; 95.5 three sigma; 99.7 six sigma; 99.97 six sigma; 99.9997
93. Thus far, your risk management activities have produced a list of potential risk events, an overall risk ranking for the project, a list of individually prioritized risk events, and a watch list for low risks. Your next step should be to ________. a. b. c. d.
24
consider whether modeling or simulation techniques are appropriate identify risk triggers create appropriate fallback plans identify appropriate response strategies
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Comprehensive Exam 2
94. Quality assurance tends to focus on ________ whereas quality control tends to focus on ________. a. executing and controlling to provide confidence that stakeholders’ requirements will be met; controlling and closing to document that acceptance criteria have been met b. planning and executing to provide confidence that stakeholders’ requirements will be met; executing and closing to document that acceptance criteria have been met c. planning and executing to document that acceptance criteria have been met; executing and closing to provide confidence that stakeholders’ requirements will be met d. initiating and planning to provide confidence that stakeholders’ requirements will be met; executing and controlling to document that acceptance criteria have been met 95. Which of the following is a disadvantage of the matrix organizational structure? a. b. c. d.
Team members are borrowed and getting commitment may be difficult. The project manager has more control over resources. The flow of information is comparatively simple. Team members have one clear boss; accountability is simplified.
96. You just received an input from your supervisor to “help” you complete the proposed budget for the newest project. Upon review, you realize that the monetary amount for management reserve has been included in the baseline. Before formal submission of this budget, you should _______. a. leave the amount as shown; the supervisor has handled the management reserve correctly b. include a footnote highlighting the amount intended for management reserve c. remove the management reserve and show it as a separate amount d. remove this amount completely, management reserve is not a legitimate budgeting approach 97. Which of the following statements about effective meetings is incorrect? a. b. c. d.
An important role for a meeting chairperson is to prevent drift and disruption. Effective meetings require a clear purpose and agenda. Cultural differences may lead to increased conflict during a meeting. Team building would tend to be a distraction and prolong the duration of most project team meetings.
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Comprehensive Exam 2
98. Which of the following statements about quality control is true? a. Inspection will keep defects from getting to customers and will also improve your processes. b. If process results are random, your process is not under control and should be investigated. c. Ten consecutive outcomes are all below the center line in your control chart. You should investigate your process as if a special cause had occurred. d. A Pareto chart is a horizontal bar chart that is useful in detecting trends in process outcomes. 99. You just finished establishing roles and responsibilities, publishing an organization chart, and creating the staffing management plan for your project. Your next step in human resource management is to ________ and the primary output will be ________. a. b. c. d.
acquire a project team; acquisition acquire a project team; project staff assignments develop a project team; team performance improvements develop a project team; project performance appraisals
100. Which of the following steps are you most likely to perform first? a. b. c. d.
Plan Procurement Management Create WBS Acquire Project Team Define Scope
101. You are a project manager for the Laboratory of Advanced Future Energy Reinventers (LOAFER). Your current solar energy project is $400,000 over budget and is also behind schedule. The good news is that one of your engineers has found a way to reduce costs by incorporating the advantages of a superior technology that was not available at the beginning of the project. Which of the following techniques is being used? a. b. c. d.
value engineering configuration management product analysis quality function deployment
102. Which of the following is an input to Develop Project Management Plan? a. b. c. d.
26
expert judgment facilitation techniques change requests project charter
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Comprehensive Exam 2
103. You are near the end of the third phase of a multi-million dollar environmental remediation project in Nevada. The execution of all major project deliverables is complete and all change requests have been handled. The next integration management step at this point is ______. a. b. c. d.
close project or phase direct and manage project work scope validation integrated change control
104. Which of the following statements about the critical path is/are true? i. The critical path identifies activities that have finish dates imposed by stakeholders. ii. Activities on the critical path always have zero float. iii. By definition, there can only be one critical path at any given time. a. b. c. d.
i ii ii and iii none of the statements is correct
105. The statement of work (SOW) is an input when developing the project charter. Which statement about the SOW is not correct? a. The SOW describes the business need and provides a cost-benefit analysis. b. The SOW provides a narrative description of products, services, or results to be delivered. c. For internal projects the sponsor provides the SOW based on business needs. d. For external projects the customer provides the SOW as part of a proposal or bid document. 106. Effective communication management is among THE most important things any successful project manager must do. Which of the following statements about communication is correct? a. b. c. d.
Active listening is a communication barrier. The preferred method of communication with stakeholders is e-mail. Cultural differences may be a barrier to effective communication. Change requests is an input to Control Communications.
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Comprehensive Exam 2
107. Which of the following is a correct definition within the area of risk management? a. Risk is an uncertain event that may have a negative effect on a project. b. Risk factors include cost, schedule, scope, and quality. c. Uncertainty is a lack of information that makes it difficult to estimate the likelihood of an event. d. Risk analysis determines an appropriate response for a particular situation. 108. Which of the following is a process in the initiating process group? a. b. c. d.
define scope identify stakeholders expert judgment estimate costs
109. There are six processes in the knowledge area for managing risks. Which one is not always used on every project? a. b. c. d.
Plan Risk Responses Perform Qualitative Risk Analysis Control Risks Perform Quantitative Risk Analysis
110. A detailed cost estimate has been completed using painstaking definitive cost estimating methods. What is the next cost management step that should be taken? a. b. c. d.
Ensure that the estimate provided has a range of accuracy of -10 to +25%. Estimate required resources. Establish a cost baseline. There is insufficient information to answer the question.
111. You are part of a team negotiating a contract for final testing of a prototype. The parties have agreed on a fixed price incentive fee (FPIF) contract with the following terms. The target cost is $1,000,000 and the associated target fee is $300,000. The ceiling price is $1,700,000 and the share ratio is 80:20. Your boss wants to know the level of cost at which the incentive stops and the contract converts to a firm fixed price equivalent to the ceiling price. You do the calculation for PTA and report that the point of total assumption is ______. a. b. c. d.
28
$1,300,000 $1,500,000 $1,875,000 there is not enough information to determine the answer
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Comprehensive Exam 2
112. Which of the following problems is a likely result of failure to effectively delegate tasks within the project team? a. b. c. d.
Morale is low and you frequently work late hours. Hiring decisions are slow and lag behind project needs. Decision making is usually democratic. Meetings are taking too long.
113. As part of your quality control program, you are using a chart that resembles the skeleton of a fish. What is the name of this tool and what are you using it for? a. Run Chart; tracks performance and identifies trends. b. Ishikawa Diagram; identifies factors possibly causing or influencing a specific problem. c. Control Chart; determines whether a given process is under control. d. Scatter Diagram; determines the greatest causes of defects. 114. Which of the following is not an input to directing and managing project work? a. b. c. d.
the project management plan organizational process assets approved change requests change requests
115. Which of the following is an output of control scope? a. b. c. d.
performance reports variance analysis requirements traceability matrix WBS updates
116. A simple sub-project has been planned as follows. Tasks A, B, and C are to be performed in sequence with finish-to-start dependencies and durations of 8, 7, and 4 days respectively. On a second path, tasks D and E are to be performed in sequence with finish-to-start dependencies and durations of 5 and 10 days respectively. Additionally, task D has task A as a predecessor (finish-to-start). What is the expected duration of this sub-project? a. b. c. d.
15 days 19 days 23 days there is not enough information to determine the answer
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Comprehensive Exam 2
117. A simple sub-project has been planned as follows. Tasks A, B, and C are to be performed in sequence with finish-to-start dependencies and durations of 8, 7, and 4 days respectively. On a second path, tasks D and E are to be performed in sequence with finish-to-start dependencies and durations of 5 and 10 days respectively. Additionally, task D has task A as a predecessor (finish-to-start). What is the float for task B? a. b. c. d.
0 days 4 days 7 days there is not enough information to determine the answer
118. A key stakeholder has raised concerns about a task that introduces significant risk with respect to the likelihood of meeting the published schedule. You decide to use PERT analysis to get a more realistic duration estimate. Using the assistance of several experts, you are told that the best case is 10 days, a worst case of 20 days, and a most likely of 12 days. What is the expected average duration using PERT analysis? a. b. c. d.
12 days 13 days 14 days 20 days
119. You are using control charts to track performance of several crucial processes. Which of the following statements is correct? a. Specification limits are established by the seller and show the variance inherent in your process. b. An assignable cause means that a process outcome is outside the specification limits. c. Random variations indicate that your process is out of control. d. Control limits reflect the natural variation inherent in your process. 120. Which of the following tools is common to both quality planning and quality assurance? a. b. c. d.
quality audits quality checklists benchmarking quality metrics
121. Which of the following is used to guide execution and control of a project? a. b. c. d.
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project management plan stakeholder register organizational process assets configuration management system
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Comprehensive Exam 2
122. The project charter was just signed by the project sponsor and you have been officially assigned as the project manager. What integration management step should you take next? a. b. c. d.
conduct integrated change control create the work breakdown structure develop the project management plan acquire appropriate staff for the next phase
123. Which of the following belongs to the monitoring and controlling process group? a. b. c. d.
perform integrated change control perform quality assurance develop project charter direct and manage project work
124. Which of the following is not a process group identified by PMI? a. b. c. d.
initiating analyzing planning closing
125. Approval for a multi-million dollar environmental remediation project in North Dakota is pending. Approval and funding for this project will be handled ______. a. b. c. d.
by the project manager by the project management team internal to the project boundaries external to the project boundaries
126. Which of the following prioritizes the needs of key stakeholders? a. b. c. d.
identify stakeholders collect requirements manage stakeholder expectations define scope
127. Collect requirements is part of the _____ process group? a. b. c. d.
initiating planning executing closing
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Comprehensive Exam 2
128. The requirements management plan, requirements documentation, and a detailed, written scope statement have been completed. Which major scope management output should be produced next? a. b. c. d.
the WBS project documents updates inspection accepted deliverables
129. Which statement about the WBS is not true? a. b. c. d.
Each item is generally assigned a unique numerical identifier. Activities at the lowest level of the WBS are referred to as work packages. The WBS provides the same information as the OBS. The WBS is part of the scope baseline.
130. The process of creating a detailed, written scope statement is part of which process and which process group? a. b. c. d.
define scope; initiating define scope; planning create WBS; planning create WBS; executing
131. You have chosen the appropriate tools to conduct scope management. In other words, you have decided how you intend to define the scope, identify the tasks required, inspect and accept completed work, and control scope changes. What scope management step comes next? a. b. c. d.
define scope create WBS validate scope collect requirements
132. One objective of scope control is to influence factors that lead to scope changes and to control the potential impact of those changes. Which of the following is an output of Control Scope? a. b. c. d.
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change control system variance analysis scope creep organizational process assets updates
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Comprehensive Exam 2
133. Your organization is interested in developing a highly exploratory idea that would extend the previous boundaries of artificial intelligence. The research question is whether it is possible to repel or kill the common, and annoying, house fly using the power of intense, focused mental thought processes. You wish to engage a university research lab to explore the idea as a proof of concept type of project. Which contract type is best suited for this work? a. b. c. d.
CPPC CPFF CPIF CPAF
134. Controlling changes to the schedule is part of which process group? a. b. c. d.
planning executing monitoring and controlling closing
135. Which of the following statements about the critical path is false? a. b. c. d.
Activities on the critical path have zero float. It is possible for critical path activities to have negative float. Critical activities are those which are important to key stakeholders. The critical path is the longest path.
136. In modern usage, precedence diagrams are preferred over arrow diagrams. Which of the following statements is not true as to why precedence diagrams are preferred? a. b. c. d.
They allow flexibility through the use of various types of dependencies. They make more effective use of dummy activities. They handle lag more effectively. They are supported by modern project management software.
137. A contractor has submitted work that is incomplete. If the project manager accepts the work and does not demand that it be completed, the contractor may be excused from meeting the requirements based on the concept of ________. a. b. c. d.
waiver warranty offers that cannot be refused undefined work
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Comprehensive Exam 2
138. The schedule baseline is determined as part of which process group? a. b. c. d.
initiating planning executing monitoring and controlling
139. Your organization began using a methodology benchmarked to the PMBOK® Guide approximately one year ago. You just completed the process of estimating durations. Which schedule management process should you complete next? a. b. c. d.
develop schedule estimate activity resources control schedule perform integrated change control
140. You just completed the cost estimate to install a fire alarm and security system in an elementary school. The estimate is $100,000 but your experience suggests that the actual outcome could range from $95,000 to $110,000. What kind of estimate have you created? a. b. c. d.
rough order of magnitude order of magnitude budget definitive
141. Which of the following is not a tool of control costs? a. b. c. d.
earned value management project management software performance reviews project funding requirements
142. The initial cost estimate to support a go/no-go decision has been completed using a combination of analogous and parametric methods. What is the next cost management step that should be taken? a. b. c. d.
34
ensure that the estimate provided has a range of accuracy of -10% to +25% estimate required resources establish a cost baseline There is insufficient information to answer the question.
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Comprehensive Exam 2
143. Many organizations place extra money in the cost estimates and the budget to account for uncertainty. As a tool in cost management, this practice is known as _____ and is associated with ______. a. b. c. d.
alternatives generation; estimate costs reserve analysis; estimate costs reserve analysis; estimate costs and determine budget cost baseline; determine budget
144. You have produced a definitive estimate using the bottom-up method. You are about ready to take this estimate to upper management and ask to establish a firm cost baseline. You should brief your audience that the range of accuracy on this estimate is approximately ______. a. b. c. d.
-5% to +10% -10% to +25% -25% to +75% -50% to +100%
145. The total budget for your project, known as the BAC (budget at completion), is $750,000. The work is 20% complete and you have spent 24% of the budget. What is the CPI and what does it tell you about current cost performance? a. b. c. d.
0.20; cost underrun 0.20; cost overrun 0.83; cost underrun 0.83; cost overrun
146. Which of the following statements is false? a. b. c. d.
The scope baseline is an input to cost estimating. Basis of estimates is an input to cost estimating. Project documents updates is an output of cost estimating. Parametric estimating relies on accurate historical information.
147. _____ and _____ are related to cost estimating. a. b. c. d.
Project management estimating software; funding limit reconciliation Expert judgment; cost aggregation Cost aggregation; reserve analysis Vendor bid analysis; reserve analysis
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Comprehensive Exam 2
148. Which of the following is associated with all three quality management processes? a. b. c. d.
project management plan quality audits quality metrics process improvement plan
149. Which of the following statements about quality management is true? a. Low grade usually indicates a problem. b. The scope baseline is an input to plan quality management. c. As defined by PMI, quality management applies to product requirements rather than project measures. d. Costs of conformance includes warranty work. 150. Your project is experiencing significant process problems. Which of the following would best help you understand the steps that comprise the existing processes? a. b. c. d.
flowcharting statistical sampling brainstorming benchmarking
151. Control charts are used to determine whether a process is under control, i.e., whether the results are stable and predictable. Which of the following statements about control charts is false? a. Upper and lower control limits are often set at ±3σ (especially for repetitive processes). b. Specification limits establish the range of outcomes that are acceptable to the customer. c. The only quality management process that uses control charts is Control Quality. d. A process is considered out of control if any outcome is outside the control limits or if seven consecutive outcomes fall below or above the mean. 152. Which of the following is not a conflict resolution technique identified by the PMBOK® Guide? a. b. c. d.
36
Teaming Withdraw Confront/problem solve Smooth/accommodate
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Comprehensive Exam 2
153. You are preparing for an important briefing for your most important stakeholders and, among other things, you need a good way to show an integrated picture of who is performing which tasks at which time. You should consider using a ______. a. b. c. d.
resource scheduling diagram resource histogram resource milestone chart resource Gantt chart
154. Which of the following is not a process of procurement management? a. b. c. d.
Plan Procurement Management Conduct Procurements Identify Stakeholders Control Procurements
155. Which of the following are outputs of plan quality management? a. b. c. d.
benchmarking and requirements documentation quality metrics and meetings cost of quality and process improvement plan quality metrics and quality checklists
156. The contract for your traffic light synchronization project has a clause that provides for a $200,000 bonus if the project is completed within four months. The contract was FFP for a price of $1,000,000. A Monte Carlo simulation completed yesterday puts your probability of meeting the 4-month schedule at 80%. What is the expected monetary value of the bonus? a. b. c. d.
zero; you may take no credit for a tentative bonus $160,000 $1,000,000 $1,160,000
157. As a newly appointed program manager, you are considering team assignments for several project managers who work for you. One of the managers tends toward micromanagement and a highly directive style. What kind of team would be the best fit for him? a. b. c. d.
a team with Theory Y tendencies a team with very high-knowledge experts a team with Theory X tendencies a high-performing team with a history of working together
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Comprehensive Exam 2
158. Your project has a total budget of $500,000. As of the status report at the end of the third month, you have completed half of the work and have spent 60% of the total budget. What earned value information do you now have? a. b. c. d.
budget at completion, planned value, and actual costs budget at completion, earned value, and actual costs planned value, earned value, and actual costs estimate at completion, earned value, and planned value
159. Using the data provided in question 158 above, what is the variance at completion if you believe that current variances are not expected to be typical for the remaining work? a. b. c. d.
-$50,000 -$100,000 $550,000 $600,000
160. Using the data provided in question 158 above, what is the TCPI for finishing at the current EAC? a. b. c. d.
1.0 1.20 1.25 .83
161. What is the correct earned value formula for schedule variance? a. b. c. d.
(EV-PV) x SPI EV+PV EV-PV PV-EV
162. Obtaining a formal, written sign-off by the customer is a crucial aspect of what project management process? a. b. c. d.
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Control Procurements Close Procurements Negotiated Settlements Records Management System
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Comprehensive Exam 2
163. You are in the process of controlling the procurement of an information system upgrade program. One of your outputs is ______. a. b. c. d.
work performance information inspections and audits performance reporting procurement documents
164. The Plan Procurement Management process includes which of the following? a. make-or-buy analysis, selecting appropriate types of contracts, and drafting statements of work b. source selection criteria, drafting statements of work, and bidder conferences c. make-or-buy analysis, source selection criteria, and advertising d. bidder conferences, source selection criteria, and advertising 165. The primary deliverable for the initiating phase of a project is a signed _______. a. b. c. d.
draft statement of work contract requirements management plan project charter
166. According to Herzberg, when hygiene factors such as fair pay and adequate working conditions are not satisfied, employees will ______. a. b. c. d.
become angry and quit their jobs experience low motivation and dissatisfaction with their work not care because these factors have no bearing on motivation create an organized response such as an employee union
167. You are part of a project selection committee that has decided to use net present value to evaluate financial opportunity. Using this technique, a project would be minimally acceptable as long as the ______. a. b. c. d.
NPV is greater than one NPV is greater than zero NPV is greater than the EPV payback period is not longer than one year
168. Ideally, a project manager should be chosen and assigned to a project ______. a. b. c. d.
at the beginning of the planning process at the beginning of the executing process during the initiating process None of these statements is correct.
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Comprehensive Exam 2
169. You are the project manager for a team of 7 specialists with Ph.D.s in several technical fields. They are collaborating on the development of a new curriculum for a corporate Center of Excellence. You have clearly established objectives. The best leadership style in this case is ______. a. b. c. d.
laissez-faire democratic autocratic Theory X
170. Project processes describe ______ and product processes describe ______. a. b. c. d.
scope management; statements of work business requirements; delivery requirements management activities; delivery requirements management activities needed to accomplish the project; features and functions required by the customer
171. You are the project manager for a new cereal product that aids digestion, boosts energy, and makes you look younger (unless you are under the age of 17, in which case it makes you look older). You are reviewing the product description, which is called a ______, for one of your subcontracts. This product description is prepared as part of the ______ process. a. b. c. d.
scope statement; plan procurement management scope statement; conduct procurements statement of work; plan procurement management statement of work; conduct procurements
172. You are responsible for a sub-project with two paths: Tasks are to be performed as given in the table. If Task B is actually completed in only 4 days instead of 6, how does the float for Task D change? Task Start A B C D E End
a. b. c. d.
40
Predecessor -Start A B B D C, E
Duration 4d 6d 5d 7d 4d
The float on Task D changes to -2 days. The float on Task D remains 7 days. Task D is on the critical path so the float remains zero The float on Task D was originally zero and changes to +2 days.
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Comprehensive Exam 2
173. You are pleased with the performance of your project team. They are functioning as a cohesive, well organized unit. Issues are being handled smoothly and in a timely manner. Which stage of the Tuckman ladder are they at? a. b. c. d.
Performing Norming Forming Conjoining
174. Several of your team members work with a functional counterpart who constantly mentions what a highly placed stakeholder wants. The functional counterpart is attempting to use ______ power. a. b. c. d.
coercive formal referent interpersonal
175. You are in the process of preparing a quality management plan. Concerns have been expressed about needing a way to track variances and identify trends. You should use a ______. a. b. c. d.
Pareto chart flowchart control chart run chart
176. A major program is coming to an end after six exciting years, and you have dozens of contracts to close. Which of the following is not a tool you will use as part of the Close Procurements process? a. b. c. d.
Procurement audits Change control system Procurement negotiations Records management system
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Comprehensive Exam 2
177. You are devising risk management strategies and are specifically considering ways to transfer risks in the most effective manner. Which of the following identifies PMI-approved ways to transfer risk? a. b. c. d.
teaming insurance collaborating contingency reserves
178. Which procurement management process results in the award of a legally binding contract? a. b. c. d.
plan procurement management conduct procurements control procurements close procurements
179. Which of the following is not a process of scope management? a. b. c. d.
Close scope Define scope Validate scope Control scope
180. You are analyzing a situation with numerous relevant factors. You are worried about how these factors might interact and what the cost implications might be. Which of the following tools would help in this situation? a. b. c. d.
simulation cause and effect diagram decision tree earned value analysis
181. In the current reporting period, you are tracking the status of five tasks. Each task is valued at $500 and the status is as follows: task 1 is 100% complete, task 2 is 80% complete, task 3 is 60% complete, task 4 is 30% complete, and task 5 has not started. Using earned value, would the percent complete rule or the 50:50 rule provide a larger earned value? a. b. c. d.
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50:50 rule with an EV of $1,000 50:50 rule with an EV of $1,250 percent complete rule with an EV of $1,000 percent complete rule with an EV of $1,350
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Comprehensive Exam 2
182. If a performance appraisal becomes appropriate for a team member, which project management process addresses the handling of appraisals? a. b. c. d.
Manage Stakeholder Engagement Plan Stakeholder Management Develop Project Team Manage Project Team
183. What is the formula for Cost Performance Index in the earned value management system? a. b. c. d.
EV / AC EV / PV EV / BAC AC / BAC
184. The Plan Communication Management process determines the information needs of key stakeholders. Which of the following is an output of that process? a. b. c. d.
project management plan updates communication models communications management plan organizational process assets updates
185. Two of your team members were reassigned to a project in trouble. Trying to find something positive about this revolting turn of events, you mused that at least you don’t have as many communication channels to manage. How many fewer channels do you now have in your remaining group of five? a. b. c. d.
21 11 10 2
186. Which of the following statements about risk management is false? a. Utility function is a concept that considers the best way to achieve business opportunities. b. Project risk is always in the future. c. Projects without a proactive focus on risk management have an increased chance of failure. d. SWOT analysis is a tool for the Identify Risks process.
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Comprehensive Exam 2
187. Which procurement management process uses advertising? a. b. c. d.
Plan Procurement Management Conduct Procurements Control Procurements Close Procurements
188. As part of the Close Procurements process, the primary purpose of procurement audits is to ______. a. b. c. d.
provide a structured review of all important procurement documents provide an external, unbiased review of procurement procedures identify and settle all outstanding issues, claims, and disputes identify successes and failures that warrant recognition in the management of other procurements
189. Which of the following is an input of the Close Procurements process? a. b. c. d.
procurement management plan organizational process assets records management system procurement documents
190. In light of the data provided below, how much free float is on the critical path? Task Start A B C D E F End a. b. c. d.
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Duration -6 days 8 days 7 days 5 days 8 days 5 days --
Predecessor -Start Start A, B A, B C, D D, E F
two days one day zero days cannot be determined from the data provided
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Comprehensive Exam 2
191. You just received data to construct your next status report. You are confused, however, because your earned value analysis says the project is on schedule and your critical path analysis indicates that the project is three days behind schedule. Is this possible? a. No, something is wrong with the data. b. Yes, earned value totals the status of all tasks, so it is possible for the critical path to be behind schedule while numerous non-critical tasks are ahead or on schedule. c. It depends on which earned value reporting rule is being used. d. There is insufficient information to answer the question 192. With respect to the circumstances presented in the previous question, what should you do? a. Ask that the data be re-evaluated because there is something definitely wrong. b. Trust the critical path analysis. For scheduling purposes, it is more reliable and provides more information anyway (float, early times, and late times). c. Re-evaluate the earned value reporting rules. d. There is insufficient information to answer the question. 193. If you experience a dispute with respect to a change request, which procurement management process provides the means to handle such a problem? a. b. c. d.
Plan procurements (expert judgment) Conduct procurements (change requests) Control procurements (claims administration) Control procurements (claims administration) and Close procurements (procurement negotiations)
194. Aside from developing the project charter, which project management process is part of initiating? a. b. c. d.
Collect requirements Identify risks Estimate costs Identify stakeholders
195. You are installing security systems for an entire school district in the state of Minnesota. The client has directed that you must work at night and return the rooms to a usable condition for class each day. This requirement represents ______. a. b. c. d.
a constraint an assumption an intervention an input to the statement of work
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Comprehensive Exam 2
196. You are performing risk response planning and are looking for strategies to increase the likelihood of achieving positive opportunities. Which approach should you adopt? a. b. c. d.
avoid transfer exploit mitigate
197. Which of the following statements about risk management is incorrect? a. A probability and impact matrix is part of quantitative risk analysis. b. Quantitative analysis includes statistical techniques such as simulations and analysis of expected monetary value. c. The risk management plan is an input to Plan Risk Responses. d. Controlling risks may involve modifying the project management plan. 198. Which of the following is not a form of contract termination? a. b. c. d.
termination for default termination for convenience termination for risk termination by mutual agreement
199. You are concerned about the lengthy period of time for your next contract. The economy is uncertain, and you are worried about inflation and fluctuating materials prices. Which type of contract is specifically designed to address those worries? a. b. c. d.
Fixed Price with Economic Price Adjustment Fixed Price Incentive Fee Time and Materials Cost Plus Award Fee
200. Which of the following are methods for acquiring members of your project team? a. b. c. d.
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pre-assignment, negotiation, and sharing negotiation, sharing, and acquisition pre-assignment, negotiation, and acquisition negotiation, virtual team, and collaborating
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Comprehensive Exam 2 Answer Sheet #1 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. 23. 24. 25. 26. 27. 28. 29. 30. 31. 32. 33. 34. 35. 36. 37. 38. 39. 40. 41. 42. 43. 44. 45. 46. 47. 48. 49. 50.
51. 52. 53. 54. 55. 56. 57. 58. 59. 60. 61. 62. 63. 64. 65. 66. 67. 68. 69. 70. 71. 72. 73. 74. 75. 76. 77. 78. 79. 80. 81. 82. 83. 84. 85. 86. 87. 88. 89. 90. 91. 92. 93. 94. 95. 96. 97. 98. 99. 100.
101. 102. 103. 104. 105. 106. 107. 108. 109. 110. 111. 112. 113. 114. 115. 116. 117. 118. 119. 120. 121. 122. 123. 124. 125. 126. 127. 128. 129. 130. 131. 132. 133. 134. 135. 136. 137. 138. 139. 140. 141. 142. 143. 144. 145. 146. 147. 148. 149. 150.
151. 152. 153. 154. 155. 156. 157. 158. 159. 160. 161. 162. 163. 164. 165. 166. 167. 168. 169. 170. 171. 172. 173. 174. 175. 176. 177. 178. 179. 180. 181. 182. 183. 184. 185. 186. 187. 188. 189. 190. 191. 192. 193. 194. 195. 196. 197. 198. 199. 200.
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Comprehensive Exam 2
Answer 1. d 2. b 3. a 4. c 5. b 6. a 7. a 8. d 9. d 10. c 11. d 12. b 13. d 14. a 15. c 16. c 17. a 18. a 19. b 20. c 21. b 22. d 23. d 24. b 25. b 26. a 27. c 28. c 29. d 30. a 31. b 32. b 33. d 34. a 35. c 36. d 37. c 38. d 39. b 40. b 41. a 42. d 43. a 44. c 45. d 46. a 47. c 48. b 49. a 50. d
50
Simple Answer Key: Comprehensive Exam #2 Answer 51. b 52. a 53. d 54. c 55. a 56. b 57. c 58. a 59. b 60. d 61. a 62. c 63. d 64. c 65. c 66. b 67. d 68. d 69. b 70. a 71. a 72. b 73. d 74. b 75. c 76. a 77. b 78. c 79. d 80. b 81. a 82. a 83. b 84. d 85. c 86. d 87. c 88. a 89. c 90. a 91. b 92. d 93. a 94. b 95. a 96. c 97. d 98. c 99. b 100. d
Answer 101. a 102. d 103. a 104. d 105. a 106. c 107. c 108. b 109. d 110. c 111. b 112. a 113. b 114. d 115. d 116. c 117. b 118. b 119. d 120. c 121. a 122. c 123. a 124. b 125. d 126. a 127. b 128. a 129. c 130. b 131. d 132. d 133. b 134. c 135. c 136. b 137. a 138. b 139. a 140. d 141. d 142. c 143. c 144. a 145. d 146. b 147. d 148. c 149. b 150. a
Answer 151. c 152. a 153. d 154. c 155. d 156. b 157. c 158. b 159. a 160. a 161. c 162. b 163. a 164. a 165. d 166. b 167. b 168. c 169. a 170. d 171. c 172. d 173. a 174. c 175. d 176. b 177. b 178. b 179. a 180. c 181. d 182. d 183. a 184. c 185. b 186. a 187. b 188. d 189. d 190. c 191. b 192. b 193. d 194. d 195. a 196. c 197. a 198. c 199. a 200. c
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Comprehensive Exam 2
Detailed Answer Key: Comprehensive Exam #2 No.
Answer
Slides
Note
1
d
6-80
PERT gives insights into schedule risk because of the ranges inherent in the best case vs. worst case estimates. Wider ranges indicate work that is more uncertain.
2
b
12-59
See tools, Close Procurements. Expert judgment is often a tool, but not in this case.
3
a
6-5
Beware: you are given data to build the schedule but the question does not ask you to do so. Resource and duration estimates are done; the next step (process) is develop the schedule.
4
c
9-53
The Myers-Briggs Type Indicator identifies 4 dimensions of human behavior. The question refers to the dimension that addresses the extravert vs. introvert difference among various people.
5
b
9-41
Smoothing often involves steering around a serious disagreement by focusing on areas of agreement. The problem is that solutions reached in this fashion are often temporary (the problem recurs).
6
a
11-4
Utility function involves the amount of risk that an individual or organization is willing to accept in light of the potential reward.
7
a
12-58
In choice b, procurement audits is a tool. In choice c, closed procurements and OPA updates are outputs. In choice d, the contract file is part of OPA updates.
8
d
10-13 10-14
With a team of 15, there are 105 communication channels. (15 x 14) / 2 = 7 x 15 = 105
9
d
8-20 to 8-22
Choice a is true; the only 2 outcomes outside the control limits are the 2 bulbs at 1160 lumens. Choice b is true; the 30 bulbs at 1145 lumens are outside the customer spec limits (above the USL of 1140) and the 15 bulbs at 1055 and 1050 lumens are also outside the customer spec limits but all 45 outcomes are inside the control limits and are therefore normal for the process. Choice c is true; there are a total of 47 outcomes that do not meet customer requirements (even though 45 are within the control limits). Note: this is the type of question that should be skipped on the first or even second pass through the exam. It is too time consuming and is only worth one point.
10
c
7-47
Also see p. 1-7 in the reference manual. Two steps: 1) EV = CPI x AC = .80 x 1250 = $1,000. 2) % complete = EV / BAC = 1,000 / 5,000 = .20
11
d
12-22
[(200k – 160k)/.80] + 120k = (40k/.80) + 120k = 50k +120k = $170,000
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51
Comprehensive Exam 2 No.
Answer
Slides
Note
12
b
12-23
Price = Cost + Fee. The cost was given as 150k. Therefore, you must calculate the fee adjustment and actual final fee that is due. Fee adjust = (Target cost-Actual cost) x Seller share = (120k-150k) x .20 = - $6k. Final fee due = Target fee + Fee Adjust = 40k-6k = 34k. Therefore, the price = 150k + 34k = $184,000.
13
d
13-12 13-13
PMI suggests that high power, high interest stakeholders be managed closely.
14
a
9-42
Choices b, c, and d all sound somewhat plausible. However, choice a (stalemate) is one of the two explicit and classic problems with the use of forcing.
15
c
12-34
IFB (also called a sealed bid) is appropriate when you are looking for the best price for routine items readily available in the marketplace. A purchase order could possibly be relevant if you have a preexisting arrangement with a supplier but IFB is the more likely situation.
16
c
6-36 6-37
Task D must be connected to the project end or the network would violate diagramming rules. Overall project duration is 30 days (A, B, C) and the late finish for D is, therefore, 30. Early finish for D is 12 (because of the finish-to-finish with A).
17
a
11-52 11-53
Choice a is a strategy for maximizing positive opportunities.
18
a
12-21
See characteristics of FPIF. It is the only type that has a point of total assumption.
19
b
11-52
Choices a and d are examples of risk mitigation. Choice c is an example of avoiding a risk. Choice b (insurance) is one of several ways to transfer risk.
20
c
12-13
Time and material contracts are aimed at exactly this kind of scenario: there is a specific rate per hour for services but the number of hours needed is not known up front and is left open.
21
b
10-10
See tools for Plan Communications Management. Information management systems is a tool for both Manage and Control Communications but not for planning.
22
d
8-4
Simple definition coupled with the PMI belief that gold-plating will tend to raise costs needlessly.
23
d
7-47
CV = EV-AC = 800k-1mil = -$200,000. A negative cost variance signifies a cost overrun.
24
b
7-50
EAC (variance typical) = BAC / CPI = 2mil / .80 = $2,500,000
25
b
5-5 5-34
This is a “what next” question. Process 3 (Define Scope) is complete. The next scope management process is Create WBS.
26
a
7-6 7-30
Process 2 (Estimate Costs) is complete. The next process is Determine Budget and the primary output is the cost performance baseline.
52
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Comprehensive Exam 2 No.
Answer
Slides
Note
27
c
8-22
An outcome outside of the control limits is called a special or assignable cause. Such outcomes must be investigated to determine whether there is a problem that must be corrected. The situation may or may not be of any interest as a lesson learned.
28
c
11-38 to 11-41
Calculate EMV by multiplying each potential dollar outcome by its probability. Then, add the resulting numbers. (.6 x 10mil) + (.2 x 5mil) + (.2 x 2mil) = 6 + 1 +.4 = $7,400,000
29
d
9-35
Choices a, b, and c are all inputs.
30
a
9-48
See McGregor’s Theory X.
31
b
12-68
Also see p. 12-22 in the reference manual. Choice a: is a tool (not an output). Choice c: applies only to close procurements. Choice d: applies only to close project.
32
b
6-78
(O + 4M + P) / 6 = (7+4x10+19)/6 = 66/6 = 11 days
33
d
8-39
Choice d (deliverables) is an input. Choices a and b are among the seven basic quality tools.
34
a
2-27
Choice a describes the work authorization system (not part of closing).
35
c
9-46
Laissez-faire (choices a and d) is a leadership style (not a source of power). Self-esteem (choice b) is one of the needs in Maslow’s hierarchy.
36
d
5-35
Decomposition and expert judgment are the only 2 tools for Create WBS.
37
c
6-36 6-37
You must perform a forward and backward pass. Note that Task C has 2 predecessors (must use largest number for the early start) and that F is start-to-start with D.
38
d
6-38
The longest path is 22 days through B-D-F-G.
39
b
6-39
Free float is how long you can delay a task without delaying the start of the immediate successor task.
40
b
6-38
Float = LF-EF = 10-4 = 6 days
41
a
10-8
Choices b through d are all important, but communications planning is totally centered around information needs of key stakeholders.
42
d
3-4 3-5
Directing is not a process group. IPECC (Initiating, Planning, Executing, Controlling [Monitor/Control], and Closing).
43
a
5-25
See 4 key tools.
44
c
11-19
Delphi is a tool of Identify Risks (part of information gathering techniques). One of its features is that experts participate anonymously so that no one can dominate the outcome.
45
d
8-16 8-19
See tool #3d, Pareto Chart (included as part of 7QC). There have been questions in which a diagram is described and you must be able to “name that diagram” and know what it is used for.
46
a
9-50
See the motivation theory by Vroom: Expectancy theory.
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53
Comprehensive Exam 2 No.
Answer
Slides
47
c
10-37 to 10-39
Statement ii is incorrect. Informal communication taps you into the network of communication that often alerts you to existing or developing problems. Waiting on formal communication may make you late in responding to such problems. See effective team communication, action #2.
48
b
6-82 to 6-85
Task C is the cheapest and is on the critical path. However, it is not crashable. You would pay for adding a resource but gain no improvement (a scenario that sometimes mistakenly happens in the real world). Task E is the cheapest, crashable task on the critical path.
49
a
11-60
See tool #5, reserve analysis, which determines whether the remaining reserves are sufficient to cover the remaining risk.
50
d
2-6
Report violations of the code of conduct and always provide accurate, truthful information. You are also responsible to act in the best interests of public safety and the environment.
51
b
7-69 to 7-72
Project B is financially better by BCR and IRR measures. Project B also meets the hurdle rate and A does not (A hurdle rate is a required minimum standard established by an organization. In this example, the standard requires that a project should have an IRR of at least 20% or better.).
52
a
6-38
You do not need to draw the schedule to answer the question. The question says that the schedule is a planned schedule. Float and free float for a planned schedule is zero.
53
d
4-6 to 4-12
All statements are false. Statement i: The PM should not be assigned later than the start of planning. Statement ii: The charter is developed as part of initiating. Statement iii: Expert judgment is a tool and is never an input or output.
54
c
11-52
Insurance is one of four possible risk transfer strategies suggested by PMI.
55
a
6-16 6-17
See output #3, milestone list. Choice b: Decomposition is a tool. Choices c and d: dependency determination and activity list updates are part of sequencing.
56
b
8-3 to 8-5 8-9
Choice a: conformance is more important than non-conformance. Choice c: low grade may be acceptable (customer does not always need a luxury item). Choice d: possible but choice b (effective planning) is better.
57
c
12-65
You have privity of contract (a legal contract) with Digitizer but not Collectimizer. You must work through Digitizer and/or get their permission to work directly with Collectimizer. You are not legally permitted to work directly with Collectimizer unless Digitizer gives permission. However, as always, a contractor is responsible for their subcontractors (Digitizer is responsible for any problems).
58
a
8-13 8-14
COQ includes the cost of conformance and nonconformance which subdivides into prevention, appraisal, and failure.
54
Note
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Comprehensive Exam 2 No.
Answer
Slides
Note
59
b
8-14
See external failure costs in the table.
60
d
11-61
See output #2, change requests, and note the distinction between contingency plans and workarounds.
61
a
12-24
The PTA is part of an FPIF contract and is not part of CPIF.
62
c
7-14
Budget estimates are done early in planning to establish required levels of funding.
63
d
9-47
See motivation theory #1, Maslow’s hierarchy of needs. Selfactualization is the highest level need in the model.
64
c
12-67
Also see p. 12-20 in the reference manual: Force majeure is a procurement concept that holds that failure to perform as prescribed is forgiven as a result of an Act of Nature (e.g. volcano, earthquake, blizzard, fire).
65
c
11-46
Path convergence: the chance that D will start on time depends on whether A, B, and C all finish on time. .50 x .80 x .70 = .28
66
b
10-17
Choice b (an audit trail) depends upon written communication.
67
d
6-71 6-72
The critical path is always the path with the least float available. Choice c: If you are behind schedule, float will be negative. If you are ahead of schedule, float will be positive. Therefore, choice c has exceptions.
68
d
9-40
Problem solving is appropriate when the issues are important and compromise is not acceptable.
69
b
8-31
Quality audits and process analysis are tools of Perform Quality Assurance. The definition provided is the definition for quality assurance used by PMI.
70
a
8-24
Scatter diagrams determine whether one variable (called the independent variable) can help predict another variable (called the dependent variable).
71
a
9-39
A PMI survey found that the top seven sources of conflict were (in order of likelihood): Schedules, priorities, resources, technical opinions, administrative procedures, costs, and personalities.
72
b
6-76
The two classic methods for compressing the schedule are crashing and fast tracking. An aggressive approach would use both techniques.
73
d
5-3
Also see the 2 bullets on p. 5-1 in the reference manual, product and project scope. They are measured against the product requirements and the project management plan respectively.
74
b
7-55
Variance at completion is a forecasting formula that estimates any expected cost variances when the project has been completed.
75
c
9-40 to 9-42
Negotiating, commanding, and reward are not among the conflict resolution techniques identified by PMI. Also, note that the term “confront” is an alternative terminology for problem solving/collaborating.
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55
Comprehensive Exam 2 No.
Answer
Slides
Note
76
a
5-36 5-39
Choice b: decomposition (not subdivision). Choice c: work packages (not planning packages). Choice d: code of accounts (not hierarchy of accounts).
77
b
11-22
See output #1, risk register (which also identifies the use of risk triggers).
78
c
4-38 to 4-41
Choice a: informal changes should be resisted. Choice b: the integrity of baselines must be maintained. Choice d: more than one CCB is possible.
79
d
12-25 12-26
The contractor (seller) can possibly lose money on fixed price contracts. Further, with FFP, the contractor bears the entire effect of costs that are higher than expected (there is no share ratio).
80
b
8-7 8-29
The definitions are especially important in the quality chapter. The definition in choice b describes Perform Quality Assurance.
81
a
10-28 10-29
See outputs, Manage Communications: Project communications, project management plan updates, project documents updates, and opa updates.
82
a
7-47
You must determine EV, as follows: four 500 square foot sections have been completed at 20 hours each. So, 80 hours of work are complete at $85 per hour. EV is $6800 and AC was given as $8,000. Cost variance is EV-AC = 6800-8000 = -$1200.
83
b
12-33 12-34
See output #3, procurement documents. An RFP is appropriate for complex, non-routine (e.g., development of new technologies) items of relatively high dollar value.
84
d
8-3 to 8-5
Choice a: grade is features and functions (not quality). Choice b: low grade may be acceptable to the customer in some circumstances. Choice c: quality is meeting requirements (not necessarily exceeding them, which would constitute gold-plating).
85
c
10-40
See effective team communication, action #4, use a tight matrix. It does not necessarily follow that a tight matrix will lead to more effective meetings.
86
d
11-43
The diagram described is a decision tree. PMI has been known to ask about diagrams by first describing them (no visual illustration provided).
87
c
5-49
You will need to know the relevant process group for each process. Validate scope is part of monitoring and controlling.
88
a
8-21
Control charts are part of the seven basic quality tools, which are included in plan quality management and in control quality. A detailed description of tolerances is provided on pp. 8-6 & 7 in the reference manual. Tolerances are defined by the customer. They are usually implemented through the designation of upper and lower specification limits (USL and LSL). Tolerances define the range of variation in product outcomes that is acceptable to the customer.
89
c
10-27
See tool #5, performance reporting.
56
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Comprehensive Exam 2 No.
Answer
Slides
Note
90
a
7-67
See sunk cost, money already spent that cannot be recovered. Sunk costs should be ignored when deciding to terminate or continue a project.
91
b
12-26
CPIF is often used for applied research and development of a new idea as an actual new product.
92
d
8-53
See standard deviation, 6 sigma. A common quality approach uses six sigma as the standard for meeting requirements, which means that 99.9997% of outcomes meet requirements.
93
a
11-7 11-31
See Perform Quantitative Risk Analysis. You have identified potential risks and performed qualitative analysis. The next step is quantitative analysis, which uses techniques such as modeling and simulation.
94
b
8-40
Choice b correctly states PMI’s distinction: QA is to provide confidence that requirements will be met and QC is to document that acceptance criteria have, in fact, been met.
95
a
2-20 2-23
Also see p. 2-6 in the reference manual, disadvantages of the matrix. Choice b: more control is an advantage, not a disadvantage. Choice c: information flows in a matrix are more complex. Choice d: team members have multiples bosses, not one clear boss.
96
c
7-29 7-34 7-35
Management reserve is not included in the cost baseline. It is an amount managed separately and intended for unforeseen events called “unknown unknowns”.
97
d
10-40
See effective team communication, action #6. PMI actually recommends the use of team building during meetings (especially kick-off meetings).
98
c
8-23
Choice a: inspection does not improve processes. Choice b: a pattern of random outcomes is a positive sign that your process is operating normally. Choice d: a Pareto chart is a vertical bar chart and identifies the greatest causes of defects (trends are identified using a run chart).
99
b
9-6 9-14 9-15
The first HR process is complete (the HR plan establishes roles and responsibilities, creates an organization chart, and creates a staffing management plan). The next process is to acquire the team members and output #1 is staff assignments (p. 7-8).
100
d
3-16 5-6
Also see p. 3-7 in the reference manual. Define Scope clearly precedes the WBS and Plan Procurement Management. See p. 2-15 and note that Acquire Project Team is an executing step and would not occur before the planning steps.
101
a
7-78
Value engineering is a technique that reduces costs and/or improves technology by finding better ways to provide the desired function or performance.
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57
Comprehensive Exam 2 No.
Answer
Slides
Note
102
d
4-16
Choices a and b are tools, not inputs. Choice c: change requests is always an output except when used as an input to integrated change control.
103
a
4-4 4-47
Choices b and d have already been completed. Choice c: is a scope management process. Close project is the only remaining process within integration management.
104
d
6-71 6-72
See tool #2, critical path method. Statement i: imposed dates are called constraints. Statement ii: float on the critical path will be positive if you are ahead of schedule and negative if you are behind schedule. Statement iii: it is possible to have more than one critical path (same durations).
105
a
4-10
Choice a: Describes the business case, not the SOW. The other three choices are all correct.
106
c
13-27 10-17 10-38
Choice a: active listening promotes good communication. Choice b: preferred method with stakeholders is face-to-face. Choice c: cultural differences are a potential barrier to good communication. Choice d: change requests is an output, and is never a tool for any process.
107
c
11-3 11-4 11-7
Choice a: Risk may also have a positive effect. Choice b: Risk factors (p. 9-2) include the potential event, the likelihood, and the amount at stake. Choice d: Risk analysis prioritizes the potential effect of each risk event.
108
b
3-16
Also see p. 3-7 in the reference manual. The initiating process group has 2 processes: Develop Project Charter and Identify Stakeholders.
109
d
11-31
PMI states that not all projects need the rigorous and sophisticated approaches that come with quantitative risk analysis. Some projects are both low cost and low risk. They do not need Monte Carlo simulations or decision trees.
110
c
7-6 7-14 7-25
Determining the budget is the next step after estimating costs. Choice c (the cost baseline) is the primary output of determining the budget. Choice a: range of accuracy on a definitive estimate is -5 to +10%. Choice b: the next process is determine budget, which does not produce resource estimates as an output. Choice d: there is enough information to answer.
111
b
12-22
PTA = [(1,700,000 – 1,300,000)/.80] + 1,000,000 = $1,500,000
112
a
9-55
Failure to delegate causes work to stack up awaiting your attention. Morale will often suffer when employees are not trusted and allowed to do their job.
113
b
8-15 8-18
See tool #3, seven basic quality tools. An Ishikawa Diagram resembles the appearance of the skeleton of a fish. Employed in a group process, it is used to find actionable root causes for a specific problem or concern.
114
d
4-27
Choice d (change requests) is always an output with one exception (it is an input for integrated change control).
58
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Comprehensive Exam 2 No.
Answer
Slides
Note
115
d
5-58 5-64
See output #3, project plan updates (the scope baseline may be updated as a result of scope changes and the scope baseline includes the WBS). Choice a: performance reports is not part of scope control. Choice b: variance analysis is always a tool. Choice c: requirements traceability matrix is an input.
116
c
6-36 to 6-38
You must draw the network. Path ADE totals 23 days and is the longest path (and, therefore, the critical path).
117
b
6-38
The forward and backward pass reveals EF and LF of 15 and 19 respectively for Task B. Therefore, float is 4 days (19-15).
118
b
6-78 6-79
PERT e(t) = (O + 4M + P) / 6 = 78/6 = 13 days.
119
d
8-17 8-20 to 8-23
See tool #3, seven basic quality tools (control charts). Choice a: spec limits are established by the buyer. Choice b: an assignable cause is an outcome outside the control limits. Choice c: a random pattern tends to show a process that is operating normally.
120
c
8-10 8-30
Choice a: quality audits are used only in quality assurance. Choice b: quality checklists is an output, not a tool. Choice d: quality metrics is an input or an output, not a tool. Note that for quality assurance, benchmarking falls under tool #1 (quality management and control tools).
121
a
4-15 4-18
The project management plan is used to guide execution and control of the project.
122
c
4-4
Process 1 is complete. Process 2 (project management plan) is next.
123
a
4-5
Also see p. 3-7 in the reference manual. Any form of change control is part of monitoring and control. Choices b and d: quality assurance and directing and managing project work are part of executing. Choice c: The charter is part of initiating.
124
b
3-4
The process groups are initiating, planning, executing, monitoring and controlling, and closing (IPECC: monitoring and controlling is often shortened to controlling).
125
d
4-8 4-9
Also see p. 4-2 in the reference manual. Approval of a project and its funding occur external to project boundaries, but are documented by a project document known as the project charter.
126
a
13-9 13-13
127
b
5-6
Collect requirements is part of planning.
128
a
5-6 5-40
What is next: scope management processes 1 through 3 are complete (plan scope management, collect requirements, and define scope). Process 4 (Create WBS) is next. See output #1, scope baseline, which includes the WBS.
The introduction to Identify Stakeholders indicates that project managers have limited time and must prioritize the importance of various stakeholders. The first tool (stakeholder analysis) also provides a grid for prioritizing relative importance.
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59
Comprehensive Exam 2 No.
Answer
Slides
129
c
5-37
The WBS displays deliverables and work packages that must be performed. The OBS links tasks in the WBS to resources on the organization chart that will perform the work.
130
b
5-6 5-24
Define Scope produces the detailed scope statement and is part of planning.
131
d
5-5
After the scope management plan is complete (scope process #1), the next process is Collect Requirements.
132
d
5-58 5-64
See output #5, OPA updates. Choice a: as part of the project plan, the change management plan (change control system) is an input. Choice b: variance analysis is a tool (analysis is always a tool and never an input/output). Choice c: scope creep is an undesirable, unintended effect of failure to manage changes effectively.
133
b
12-26
Cost plus fixed fee contracts are often used for exploratory research and proof of concept efforts.
134
c
3-12 6-6
Any act of change control is part of the monitor and control process group.
135
c
6-71 6-72
Activities on the critical path are determined by the results of sequencing and duration estimating. Stakeholders do not directly designate activities as belonging to the critical path.
136
b
6-28
Precedence diagrams do not use dummy tasks.
137
a
10-20
See the definition of waiver.
138
b
6-64 6-86
See output #1. The schedule baseline is an output of schedule development, which is a planning step.
139
a
6-5 6-64
Estimating durations is process #4 in time management. Process #5 is to develop the schedule.
140
d
7-14
See accuracy of estimates. A definitive estimate has a -5 to +10% range.
141
d
7-39
Choice d (project funding requirements) is an input, not a tool.
142
c
7-6 7-30
The next process is determining the budget and the primary output is the cost baseline.
143
c
7-15 7-25
Reserve analysis is tool #6 for estimate costs and tool #2 for determine budget.
144
a
7-14
See accuracy of estimates (definitive). You should be familiar with the types of estimates and associated accuracy.
145
d
7-47
CPI = EV / AC. EV = .20 x 750,000 = $150,000. AC = .24 x 750,000 = $180,000. CPI = 150 / 180 = .833 and a CPI less than one indicates a cost overrun.
146
b
7-15
Choice b (basis of estimates) is an output, not an input.
147
d
7-15
Choice a: funding limit reconciliation is associated with determine budget. Choices b and c: cost aggregation is associated with determine budget.
60
Note
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Comprehensive Exam 2 No.
Answer
Slides
Note
148
c
8-10 8-30 8-39
Metrics is an output of plan quality and an input to quality assurance and quality control. Choice a: project management plan is only associated with quality assurance and quality control. Choice b: quality audits are only associated with quality assurance. Choice d: process improvement plan is only associated with plan quality and quality assurance.
149
b
8-3 8-11 8-14 8-31
Choice a: low grade is not necessarily a problem. Choice b: true, as part of the project management plan the scope baseline is an input to planning quality. Choice c: Q.A. also looks at processes. Choice d: warranty work is part of the costs of non-conformance.
150
a
8-15
See flowcharts as part of tool #3 (seven basic quality tools).
151
c
8-10 8-30 8-39
Choice c: control charts are part of all 3 quality processes.
152
a
9-40 to 9-42
153
d
9-57
See resource Gantt chart which shows who is doing what and at what time.
154
c
12-5
Also see p. 3-7 in the reference manual. Identify stakeholders is part of stakeholder management.
155
d
8-10
See list of outputs. Choices a, b, and c contain items which are either inputs or tools, not outputs.
156
b
11-38 to 11-41
EMV = probability x amount at stake = .80 x 200,000 = $160,000.
157
c
9-48
See motivation theory for McGregor’s Theory X-Theory Y. If employees are believed to be basically lazy, theory X suggests a highly directive and controlling management style.
158
b
7-46
Choices a, c, and d: planned value is not revealed in the data.
159
a
7-51 7-55
1. VAC = BAC-EAC. BAC is given as $500,000. EAC must be calculated. 2. EAC (variance not typical) = AC + (BAC-EV) = 300,000 + 500,000 - 250,000 = $550,000. So, VAC = 500k-550k = -$50,000.
160
a
7-57
TCPI (EAC) = (BAC-EV)/(EAC-AC) = (500k-250k)/(550k-300k) = 1.0
161
c
7-48
SV = EV-PV
162
b
12-60
See output #1, closed procurements.
163
a
12-49
Choices b and c are tools, not outputs. Choice d: an input.
164
a
12-9 12-38
Bidder conferences and advertising (choices b, c, and d) are associated with conduct procurements, not plan procurements.
Teaming is not part of the Thomas and Kilmann conflict model.
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61
Comprehensive Exam 2 No.
Answer
Slides
Note
165
d
3-7
Also see p. 3-7 in the reference manual. Choice a: draft SOW comes from plan procurements (planning).Choice b: contract comes from conduct procurements (executing). Choice c: requirements management plan comes from collect requirements (planning).
166
b
9-49
See the motivation theory on Herzberg’s Hygiene Factors. When not cared for, hygiene factors may cause low motivation and dissatisfaction.
167
b
7-71
NPV > 0 indicates a profitable project.
168
c
4-8
Ideally, the project manager should be assigned during initiating and participate in development of the charter. The PM should never be assigned later than the start of planning.
169
a
9-54
See leadership styles. Laissez-faire would be the best fit for a highknowledge group of experts (especially when clear objectives are established).
170
d
5-3
See product scope (describes features and functions in the desired product or service) and project scope (identifies management activities required to deliver the product or service).
171
c
12-33
The scope statement and SOW both describe the product but the SOW is part of the procurement process whereas the scope statement is created as part of scope management.
172
d
6-36 to 6-38
The critical path is ABDE with a duration of 21 days. When Task B finishes in 4 days instead of 6, the new finishes for B, D, and E become 8, 15, and 19 respectively. Therefore, the float for Tasks D and E changes from zero to +2. The project is now ahead of schedule.
173
a
9-30
You have a professional obligation to protect sensitive information belonging to others, and you should not immediately escalate an issue. In this case, you should speak directly with the administrative assistant before raising the issue with anyone else.
174
c
9-46
Referent power is exercised by “referring” to powerful figures in an attempt to make someone cooperate either because they respect or, conversely, are afraid of the powerful figure.
175
d
8-54
Run charts are used to identify and track trends and variances.
176
b
12-49 12-57
Choice b (contract change control system) is part of Control Procurements (not Close Procurements).
177
b
11-52
See tool #1, strategies for negative risks: Methods to transfer risk include insurance, warranties, outsourcing, fixed price contracts.
178
b
12-5 12-46
See output #2, agreements (part of conduct procurements). PMI now also refers to contracts as agreements.
179
a
5-5
Scope management processes include: plan scope management, collect requirements, define scope, create WBS, validate scope, and control scope. There is no process called close scope.
62
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Comprehensive Exam 2 No.
Answer
Slides
Note
180
c
11-45
See EMV. Decision trees help identify the possible interactions (risk event interdependencies) in a given situation and also factors in cost effects through the use of expected monetary value.
181
d
7-58
The 50:50 rule gives half credit for any task started but not completed (tasks 2-4), 100% credit for tasks completed (task 1), and no credit for tasks that have not started (task 5). EV using the 50:50 rule totals $1,250. The % complete rule gives credit by multiplying PV by the reported % complete. This rule totals $1,350 in this case.
182
d
9-38
See manage project team, tool #2, performance appraisals.
183
a
7-48
Choice b = SPI. Choice c = % completed. Choice d = % spent.
184
c
10-10
See output #1, communications management plan. Choices a and d: Project plan updates and OPA updates are not part of plan communications. Choice b: Communication models is a tool.
185
b
10-13 10-14
With 7 members, you had 21 channels: (7x6)/2. With 5 members, you have 10 channels: (5x4)/2. You have decreased from 21 to 10, 11 fewer channels.
186
a
11-3 11-4
Utility function addresses how much risk one is willing to accept in light of the potential reward (does not evaluate how to achieve business opportunities).
187
b
12-38
Advertising is Tool #5 of Conduct Procurements.
188
d
12-59
See tool #1, procurement audits. Procurement audits identify lessons learned (successes and failures that may help in managing future projects).
189
d
12-57
Procurement documents is input #2.
190
c
6-36 to 6-38
Trick question that has been used on the real exam. You do not need to build or analyze the schedule. Float and free float on the critical path is zero.
191
b
N/A
This is a logic question. Earned value totals the status of all tasks and does not focus only on the critical path. Therefore, it is conceivable that the critical path could be behind schedule while many non-critical tasks could be ahead of schedule. Choice c, the EV rule being used, may have some bearing but choice b is a better answer.
192
b
N/A
Earned value was created primarily for the cost information. For accurate schedule data, critical path analysis would be superior.
193
d
12-53 12-59
Slide 12-53: See Tool #6, Claims administration. Slide 12-59: Also see Procurement negotiations. Choice c is correct but choice d is more complete in that the dispute may extend past the official closing of the procurement (procurement negotiations).
194
d
3-16
Also see p. 3-7 in the reference manual. The initiating processes are Develop Project Charter (integration management) and Identify Stakeholders (stakeholder management).
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63
Comprehensive Exam 2 No.
Answer
Slides
195
a
5-32
See output #1, scope statement: Constraints are restrictions imposed by others.
196
c
11-52 11-53
Choices a, b, and d are strategies for dealing with negative risks (see tool #1). Choice c, exploit, is one of the strategies for achieving positive opportunities (see tool #2)
197
a
11-24
A probability and impact matrix is part of qualitative analysis, not quantitative analysis (see tool #2).
198
c
12-56
See close procurements, introduction. Termination may occur for default, convenience of the buyer, or by mutual agreement.
199
a
12-28
See fixed price with economic price adjustment.
200
c
9-18
See the 4 tools for acquiring a team. Sharing and collaborating are not among these tools (choices a, b, and d).
64
Note
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