A standard is a formal document that describes established norms, methods, processes and practices.

First two chapters provide an introduction to key concepts in the project management field. Chapter three is the standard for project management. Chapter 4 through 1 are the guide to the project management body of knowledge. !he "#$%& guide provides guidelines for managing invidividual projects. !his standard is a guide rather than a methodology. !he Project Management Institute Code of Ethics and Professional Conduct is specific about the basic obligation of responsibility, respect, fairness and honesty. A project is a temporary endeavour undertaken to create a uni'ue product, service or result. !he temporary nature of projects indicates a definite beginning and end. !he end is reached when the project( objectives have been achieved or when the project is terminated because its objectives will not or cannot be met or when the need for the project no longer e)ists. Temporary does not necessarily mean short in duration. Temporary does not generally apply to the product, service or result created by the project* most project are undertaken to create a lasting outcome. "rojects can also have social, economic and environemental impacts that far outlast the projects themselves. +very project creates a unique product, service or result. A project can involve a single person, a single organization or multiple organizational units. "rojects are not ongoing efforts. A project can create, - A product that can be either a component of another item or an end item in itself. - A capability to perform a service - A result such as an outcome or document. #anaging a project typically includes - .dentifying the re'uirements - Addressing the various needs, concerns and e)pectations of the stakeholders as the project is planned and carried out. - $alancing the competing project constraints including, but not limited to, a. /cope b. 0uality c. /chedule d. $udget e 1esources f. 1isk A portfolio refers to a collection of projects or programs and other work that are grouped together to facilitate effective management of that work to meet strategic business objectives. Portfolio management refers to the centrali2ed management of one or more portfolios, which includes identifying, prioriti2ing, authori2ing, managing and controlling projects, programs and other related work to achieve specific business objectives. A program is defined as a group of related projects managed in a coordinated way to obtain benefits and control not available from managing them individually. A project may or may not be part of a program but a program will always have projects. .f the relationship between projects is only that of a shared client, seller, technology or resource, the effort should be managed as a portfolio of projects rather than as a program.

"rojects are typically authori2ed as a result of one or more of the following strategic considerations, 1. #arket demand . /trategic opportunity 3 business need 4. Customer re'uest 4. !echnological advance 5. 6egal re'uirements %rgani2ations manage portfolios based on their strategic plan, which may dictate a hierarchy to the portfolio, program or projects involved. A Project management office PM!" is an organi2ational body or entity assigned various responsibilities related to the centrali2ed and coordinated management of those projects under its domain. A PM! may be delegated the authority to act as an integral stakeholder and a key decision maker during the beginning of each project, to make recommendations, or to terminate projects or take other actions as re'uired to keep business objectives consistent. A primary function of a "#% is to support project managers in a variety of ways which may include, but are not limited to, 1. #anaging shared resources across all projects administered by the "#%. . .dentifying and developing project management methodology, best practices and standards. 4. Coaching, mentoring, training and oversight. 4. #onitoring compliance with project management standards, policies, procedures, and templates via project audits. 5. 7eveloping and managing project policies, procedures, templates and other shared documentation and 8. cordinating communication across projects. "roject managers and "#%s pursue different objectives and, as such are driven by different re'uirements. All of these efforts, however are aligned with the strategic needs of the organi2ation. 7ifferences between the role of a project managers and a "#% may include the following, - !he project manager focuses on the specified project objectives, while the "#% manages major program scope changes which may be seen as potential opportunities to better achieve business objectives. - !he project manager controls the assigned project resources to best meet project objectives while the "#% optimi2es the use of shared organi2ational resources across all projects. - !he project manager manages the constraints 9scope, schedule, cost, and 'uality, etc: of the individual projects while the "#% manages the methodologies, standards, overall risk 3 opportunity, and interdependencies among projects at the enterprise level. %perations are an organi2ational function performing the ongoing e)ecution of activities that produce the same product or provide a repetitive service. "rojects can intersect with operations at various points during the product life cycle, such as, - At each closeout phase - ;hen developing a new product, upgrading a product, or e)panding outputs, - .mprovement of operations or the product development process* or - until the divestment of the operations at the end of the product life cycle. !perations are permanent endeavors that produce repetitive outputs, with resources assigned to do basically the same set of tasks according to the standards institutionali2ed in a product life cycle. !he project manager is the person assigned by the performing organi2ation to achieve the project objectives. !he functional manager is focused on providing management oversight for an administrative area, and operations managers are responsible for a facet of the core business. +ffective project management re'uires that the project manager possess the following characteristics, 1. &nowledge . "erformance 4. "ersonal

+nterprise environmental factors refer to both internal and e)ternal environmental factors that surround or influence a project( success, # !rganizational culture, structure and processes # $overnmental or industry standards # Infrastructure - E%isting human resources # Personnel administration # Company &or' authorization systems # Mar'et place conditions - /takeholder risk tolerances - "olitical climate - %rgani2ation( established communications channels - Commercial databases # Project management information systems

A project life cycle is a collection of generally se'uential and sometimes overlapping project phases whose name and number are determined by the management and control needs of the organi2ation or organi2ations involved in the project, the nature of the project itself, and its area of application. !he life cycle provides the basic framework for managing the project, regardless of the specific work involved. Triple Constraints, !ime, scope and cost Cost and staffing levels are low at the start, peak as the work is carried out, and drop rapidly as the project draws to a close. /takeholders influences, risk, and uncertainty are greatest at the start of the project. !hese factors decrease over the life of the project. Ability to increase the final characteristics of the project( product, wihtout significantly impact cost, is highest at the start of the project and decreases as the project progresses towards completion. !he cost of changes and correcting errors typically increases substantially as the project approaches completion. !he product life cycle consists of generally se'uential, non-overlapping product phases determined by the manufacturing and control needs of the organi2ation. !he last product life cycle phase for a product is generally the product( retirement. "roject life cycles occur in one or more phases of a product life cycle. "roject phases are divisions within a project where e)tra control is needed to effectively manage the completion of a major deliverable. "roject phases are typically completed se'uentially, but can overlap in some project situations. !he number of phases, the need for phases, and the degree of control applied depend, on the si2e, comple)ity, and potential impact of the project. ;hen phases are se'uential, the close of a phase ends with some form of transfer or handoff of the work product produced as the phase deliverable. !his phase end represents a natural point to reassess the effort underway and to change or terminate the project if necessary. !hese points are referred to as phase e%its, milestones, phase gates, decision gates, stage gates or 'ill points. !hree basic types of phase to phase relationships, 1. sequential relationship, where a phase can only start once the previous phase is complete. !he step by step nature of this approach reduces uncertainity, but may eliminate options for reducing the schedule. . overlapping relationship, where the phase starts prior to completion of the previous one. this can sometimes be applied as an e)ample of the schedule compression techni'ue called fast tracking. %verlapping phases may increase risk and can result in rework if a subse'uent phase progresses before accurate information is available from the previous phase. 4. iterative relationship, where only one phase is planned at any given time and the planning for the ne)t is carried out as work progresses on the current phase and deliverables. !his approach is useful in largely underfined, uncertain, or rapidly changing environements

such as research, but it can reduce the ability to provide long term planning.

!perations are ongoing and produce repetitive products, services or results. Projects are temporary and end. %perations work is ongoing and sustains the organi2ation over time. %perations work does not terminate when its current objectives are met but instead follow new directions to support the organi2ation(s strategic plans. %perations work supports the business environment where projects are e)ecuted. (ta'eholders are persons or organi2ations who are actively involved in the project or whose interests may be positively or negatively affected by the performance or completion of the project. !he project management team must identify both internal and e)ternal stakeholders. %verlooking negative stakeholders can result in an increased likelihood of failure. !he customer)users are the persons or organi2ations that will use the project( product or service or result. A sponsor is the person or group that provides the financial resources, in case or in kind, for the project. !he sponsor serves as an escalation path. Program managers are responsible for managing related projects in a coordinated way to obtain benefits and control not available from managing them individually. A Project management office PM!" is an organi2ational body or entity assigned various responsibility related to the centrali2ed and coordinated management of those projects under its domain. !he responsibilities of a "#% can range from providing project management support functions to actually being responsible for the direct management of a project. !he "#% can be a stakeholder if it has direct or indirect responsibility for the outcome of the project. "#% can provide but is not limited to, 1. Administrative support services such as policies, methodologies, and templates* . !raining, mentoring, and coaching of project managers* 4. "roject support, guidance and training on how to manage projects and use of tools* 4. 1esource alignment of project staff* and3or 5. Centrali2ed communication among project managers, project sponsors, managers, and other stakeholders. Project team* project manager < project management team < other team members +unctional managers* key individuals who play a management role within an administrative or functional area of the business, such as =1, finance, accounting or procurement. !perations managers are individuals who have a management role in a core business area, such as research and development, design, manufacturing, provisioning, testing or maintenance. >nlike functional managers, these managers deal directly with producing and maintaining the saleable products or services of the enterprise. (ellers, also called vendors, suppliers or contractors are e)ternal companies that enter into a contractual agreement to provide components or services necessary for the project. Cultures and styles may have a strong influence on a project( ability to meet its objectives. Cultures and styles are typically known as ?cultural norms?. !he ?norms? include a common knowledge regarding how to approach getting the work done, what means are considered acceptable for getting the work done, and who is influential in faciliating the work getting done.

!he classical functional organization is a hierarchy where each employee has one clear superior. /taff members are grouped by specialty, such as production, marketing, engineering, and accounting at the top level. /pecialties may be further subdivided into functional organi2ations, such as mechanical and electrical engineering. +ach dept in a functional organi2ation will do its project work independent of other departments. #atri) organi2ations are a blend of funtional and projecti2ed charactersistics. ;eak matrices contain many of the characteristics of a functional organi2ation, and the project manager role is more of a coordinator or e)peditor than that of a true project manager. /trong matrices have many of the characteristics of the projecti2ed organi2ation, and can have full-time project managers with considerable authority and full-time project administrative staff. ;hile the balanced matri) organi2ation recogni2es the need for a project manager, it does not provide the project manager with the full authority over the project and project funding. .n a projecti2ed organi2ation, team members are often co-located, most of the organi2ation(s resources are involved in project work, and project managers have a great deal of independence and authority. #any organi2ations involve all these structures at various levels 9composite organi2ation: "roject e)peditor acts primarily as a staff assistant and communications co-ordinator. !he e)peditor cannot personally make or enforce decisions. "roject coordinator - similar to project e)peditor e)cept coordinator has some power to make decisions, some authority and reports to a higher level manager. !rganizational Process ,ssets - include any or all process related assets, from any or all of the organi2ations involved in the project that can be used to influence the project( success. "rocess assets include formal and informal plans, policies, procedures and guidelines. !he "rocess assets also include the organi2ation( knowledge bases such as lessons learned and historical information. Processes and Procedures 1. %rgani2ational standard processes- standards - policies - standard product and project life cycles - 'uality policies and procedures. . standardi2ed guidelines, work instructions, proposal evaluation criteria and performance measurement criteria 4. !emplates 4. @uidelines and criteria for tailoring the organi2ation( set of standard processes to satisfy the specific needs of the project 5. %rgani2ation communication re'uirements 8. "roject closure guidelines or re'uirements A. Financial controls procedures B. .ssue and defect management procedures defining issue and defect controls, issue and defect identification and resolution, and action item tracking C. Change control procedures 1D. 1isk control procedures 11. "rocedures for prioriti2ing, approving and issuing work authori2ations. Corporate 'no&ledge -ase 1. "rocess measurement databases . "roject files 4. =istorical information and lessons learned knowledge bases 4. .ssue and defect management databases 5. Configuration management knowledge bases 8. Financial databases

Project management is the application of knowledge, skills, tools and techni'ues to project activities to meet project re'uirements.

A process is a set of interrelated actions and activities, performed to achieve a pre-specified product, result, or service. "roject management process and product-oriented processes overlap and interact throughout the life of a project. "roject managers and their teams should carefully address each process and its constituent inputs and outputs. !hey are also responsible for determining which processes are appropriate and the appropriate degree of rigor for each process. !his effort is known as tailoring. "roject management processes are grouped into five categories known as project management process @roups 9or "rocess @roups: !he "rocess groups are not project phases. !he progressive detailing of the project management plan is often called ? rolling &ave planning. indicating that planning and documentation are iterative and ongoing processes.

.E!+1@1A!.%E !he approved project charter formally initiates the project. A project manager is identified and assigned as early as is feasible, preferably while the project charter is being developed and always prior to the start of planning. "roject are authori2ed by someone e)ternal to the project such as a sponsor, "#%, or portfolio steering committee. !he project initiator or sponsor should be at a level that is appropriate to funding the project. !hey will either create the project charter or delegate that duty to the project manager. !he initiators signature on the charter authori2es the project. !he statement of &or' (!/" is a narrative description of products or services to be delivered by the project. For internal projects, the project initiator or sponsor provides the statement of work based on business needs, product or service re'uirements. For e)ternal projects, the statement of work can be received from the customer as part of a bid document for e)ample, re'uest for proposal, re'uest for information, re'uest for bid, or as part of a contract. !he strategic plan documents the organi2ation( strategic goals. !herefore, all projects should be aligned with the strategic plan. !he -usiness case or similar document provides the necessary information from a business standpoint to determine whether or not the project is worth the re'uired investment. !ypically the business need and the cost-benefit analysis are contained in the business case to justify the project. !he -usiness case is created as a result of one or more of the following, 1. #arket demand . %rgani2ational need 4. Customer re'uest 4. !echnological advance 5. 6egal re'uirement 8. +cological impacts A. /ocial need A contract is an input if the project is being done for an e)ternal customer

!he project charter documents the business needs, current understanding of the customer(s needs, and the new product, service or result that is intended to satisfy, such as, 1. "roject purpose or justification . #easurable project objectives and related success criteria 4. =igh level re'urements 4. =igh level project description 5. =igh level risks, 8. summary milestone schedule A. /ummary budget B. "roject approval re'uirements C. Assigned project manager, responsibility and authority level 1D. Eame and authority of the sponsor or other person 9s: authori2ing the project charter. The 0evelop Project management plan process results in a project management plan that is progressively elaborated by updates and controlled and approved through the "erform .ntegrated Change Control process. !he Project management plan integrates and consolidates all of the subsidary management plans and baselines from the planning processes and includes but is not limited to, 1. !he life cycle selected for the project and the processes that will be applied to each phase. . 1esults of the tailoring by hte project management team as follows, - "roject management processes selected by the project management team. - 6evel of implementation of each selected process, - 7escriptions of the tools and techni'ues to be used for accomplishing those processes, and - =ow the selected processes will be used to manage the specific project, including the dependencies and interactions among those processes, and the essential inputs and outputs. 4. =ow work will be e)ecuted to accomplish the project objectives. 4. A change management plan that documents how changes will be monitored and controlled. 5. A configuration management plan 8. =ow integrity of the performance measurement baselines will be maintained. A. Eeed and techni'ues for communication among stakeholders, and B. key management reviews for content, e)tent and timing to facilitate addressing open issues and pending decisions. "roject baselines include, but are not limited to, 1. /chedule baseline, . Cost performance baseline, and 4. /cope baseline /ubsidary plans include, but are not limited to, 1. /cope management plan . 1e'uirements management plan 4. /chedule management plan 4. Cost management plan 5. 0uality management plan 8. =uman resource plan A. Communications management plan B. 1isk management plan C. "rocurement management plan

%ften the scope, schedule and cost baseline will be combined into a performance measurement baseline that is used as an overall project baseline against which integrated performance can be measured. !he performance measurement baseline is used for earned value measurements. Corrective action* 7ocumented direction for e)ecuting the project work to bring e)pected future performance of the project work in line with the project management plan. Preventive action* A documented direction to perform an activity that can reduce the probability of negative conse'uences associated with project risks.

0efect repair* !he formally documented identification of a defect in a project component with a recommendation to either repair the defect or completely replace the component. As part of ".CC process, a change control status update will indicate that some changes are approved and some are not. ,pproved change requests are scheduled for implementation by the project team. ,pproved changed requests are the documented, authori2ed changes to e)pand or reduce project scope. Approved change re'uests may re'uire implementation of preventive or corrective actions. Project management information system provides access to an, 1. automated tool, such as a scheduling software tool . configuration management system 4. information collection and distribution system 4. web interfaces to other online automated systems An approved delivera-le is any uni'ue and verifiable product, result or capability to perform a service that must be produced to complete a process, phase, or project. /or' performance information* 1. 7eliverable status . /chedule progress 4. Costs incurred Performance reports can be used to report the key information including, 1. Current status . /ignificant accomplishments for the period. 4. /cheduled activities 4. Forecasts, and 5. .ssues !he "erform .ntegrated Change control process is conducted from project inception through completion. Changes may be re'uested by any stakeholder involved within the project. Although change re'uests may be initiated verbally, they should always be recorded in written form and entered into the change management and3or configuration management system. +very documented change re'uest must be either approved or rejected by some authority within the project management team or an e)ternal organi2ation. %n many projects, the project manager is given authority to approve certain type of change re'uests as defined in the project( roles and responsibilities documentation. ;herver re'uired, the ".CC process includes a change control -oard CC1" responsible for approving or rejecting change re'uests. .f the project is being provided under a contract, then some approved changes may need to be approved by the customer as per the contract. /ome of the configuration management activities included in the integrated change control process are as follows, 1. Configuration identification . Configuration status accounting 4. Configuration verification and audit A change control -oard is responsible for meeting and reviewing the change re'uests and approving or rejecting those change re'uests. A change control system is a collection of formal documented procedures that define how project deliverables and documentation will be controlled, changed and approved. Project o-jectives are 'uantifiable criteria to measure project performance. !hese should include cost, schedule and 'uality aspects. ,nalogous estimating is also called as top down estimating

!wo categories of project selection methods and their subsets, 1. $enefits measurement methods 9Comparitive approach: - #urder board 9 a panel of people who try to shoot down a new project idea: - "eer review - /coring models - +conomic models . Constrained optimi2ation methods 9#athematical approach: - 6inear programming - integer programming - 7ynamic programming - #ulti-objective programming

Economic models for project selection - "resent value - Eet "resent Falue - .nternal rate of return - "ayback period - $enefit-cost ratio Present value means the value today of future cash flows and can be found by the formula. "F G FF 3 91<r:Hn 2et present value 2P3" is the present value of the total benefits 9income or revenue: minus the costs over many time periods. !he project with the greatest E"F is selected. Internal 4ate of 4eturn I44" is the rate 9read it as ?interest rate?: at which the project inflows 9revenue: and project outflows 9costs: are e'ual. Economic value added E3," is the amount of added value the project produces for the company( shareholders above the cost of financing the project. 5a& of 0iminishing returns* !he law states that after a certain point, adding more input will not produce a proportional increase in productivity 9e.g. modules per hour:. A single programmer may produce at 1 module per hour. ;ith a second programmer, the two may produce at 1.A5 modules per hour 9.A5 increase:. ;ith a third programmer, the group may produce at . 5 modules per hour 9D.5 increase: /or'ing capital* !his term refers to current assets minus current liabilities for an organi2ation, or the amount of money the company has available to invest, including investment in projects. Change control system #any organi2ations have a change control system as part of their %"A. !his system includes standardi2ed forms, reports, processes, procedures, and software to track and control changes. /or' authorization system !his is the project manager(s system for authori2ing the start of work packages or activities. .t is part of ++F factors on the project, which are input to monitor and control project process and many other processes. Process for ma'ing changes* 1. +valuate 9assess: the impact of the change to the project. eg, this change will add three weeks to the schedule, re'uire additional I DDDD funding and have no effect on resources. . Create options, !his can include cutting other activities, crashing, fast tracking, etc. 4. @et the change re'uest approved internally 4. @et customer buy-in 0epreciation* 6arge assets purchased by a company lose value over time. Accounting standards call this depreciation, 1. (traight line depreciation - !he same amount of depreciation is taken each year. . ,ccelerated depreciation - !here are two forms of accelerated depreciation - 7ouble declining balance - /um of the years digits Accelerated depreciation depreciates faster than straight line A low position in the organi2ation could be a source of least conflict. /chedule limitations can shape the si2e of the project team but will not influence its

organi2ational design. 1e'uests for change is always a formal process and it can be direct or indirect, e)ternally or internally initiated, and can be optional or legally3contractually mandated. A good communication management plan ensures good communication betweeen the different project interfaces and team members. !his is essential for project integration management. ;hen a project is performed under a contract, contractual provisions will generally be constraints. !he aggregation of the processes, tool, techni'ues and methodologies to manage a project is referred to as project management system. !he most important characteristics of a project manager is being an integrator who can manage all the different interfaces of the project. !he project manager should also be a good communicator, because a project manager usually spends more that CD J of her time communicating with different project stakeholders. Fre'uent change re'uests to the project scope will not impact the project charter. Corrective action, preventive action, defect repair and re'uested changes are now under the general term (change re'uest( +very stakeholder has skills and knowledge that contribute to creating a project plan. 0etailed process for ma'ing changes* 1. "revent the root cause of changes . .dentify change 4. 6ook at the impact of the change 4. Create a change re'uest 5. "erform integrated change control a. Assess the change b. 6ook for options c. Change is approved or rejected d. >pdate the status of the change in the change control system 8. Adjust the project management plan, project documents, and baselines A. #anage stakeholder( e)pectations by communicating the change to stakeholders affected by the change B. #anage the project to the revised project management plan and project documents Closing activities* 1. Confirm work is done to re'uirements . Complete procurement closure 4. @ain formal acceptance of the product 4. Complete final performance reporting 5. .nde) and archive records 8. >pdate lessons learned knowledge database A. =andoff completed product B. 1elease resources

/C%"+ Product (cope # !he features and functions that characteri2e a product, service, or result* and3or Project (cope # !he work that needs to be accomplished to deliver a product, service, or result with the specified features and functions. Completion of project scope is measured against the project management plan. Completion of the product scope is measured against the product re'uirements. !he project( success is directly influenced by the care taken in capturing and managing project and product re'uirements. An intervie& is a formal or informal approach to discover information from stakeholders by talking to them directly.

+ocus groups bring together pre'ualified stakeholders and subject matter e)perts to learn about their e)pectations and attitudes about a proposed product, service, or result. 4equirements &or'shops +acilitated &or'shops" are focussed sessions that bring key cross-functional stakeholders together to define product re'uirements. Facilitated workshops called 6oint application 0evelopment or 0esign" 6,0" sessions are used in the software development industry. .n the manufacturing industry, 7uality +unction 0eployment 7+0" is an e)ample of another facilitated workshop techni'ue that helps determined critical characteristics for new product development. 0F7 starts by collecting customer needs, also known as 3oice of the Customer 3!C". 1rainstorming is a techni'ue used to generate and collect multiple ideas related to project and product re'uirements. 2ominal group technique !his techni'ue enhances brainstorming with a voting process used to rank the most useful ideas for further brainstorming or for prioriti2ation. The 0ephi Technique A selected group of e)perts answers 'uestionnaires and provides feedback regarding the responses from each round of re'uirements gathering. !he responses are only available to the facilitator to maintain anonymity. Idea ) mind mapping .deas created through individual brainstorming are consolidated into a single map to reflect commonality and differences in understanding and generate new ideas. ,ffinity 0iagram !his techni'ue allows large numbers of ideas to be sorted into groups for review and analysis. 8nanimity* +veryone agrees on a single course of action. Majority* /upport from more than 5D J of the members of the group. Plurality* !he largest block in a group decides even if a majority is not achieved. 0ictatorship* %ne individual takes the decision for the group. 7uestionnaires and surveys are written sets of 'uestions designed to 'uickly accumulate information from a wide number of respondents. !-servations provide a direct way of viewing individuals in their environment and how they perform their jobs or tasks and carry out processes. %bservation, also called ?jo- shado&ing., is usually done e)ternally by the observer viewing the user performing his or her job. .t can also be done by a .participant o-server. who actually performs a process or procedure to e)perience how it is done to uncover hidden re'uirements. Prototyping is a method of obtaining early feedback on re'uirements by providing a working model of the e)pected product before actually build it. 4equirements documentation describes how individual re'uirements meet the business need for the project. $efore baselining, re'uirements must be unambiguous 9measurable and testable:, traceable, complete, consistent and acceptable to key stakeholders. !he requirements management plan documents how re'uirements will be analy2ed, documented, and managed throughout the project. !he phase-to-phase relationship, strongly influences how re'uirements are managed. Components of requirements management plan* 1. =ow re'uirements activities will be planned, tracked and reported* . configuration management activities such as how changes to the product, service, or result re'uirements will be initiated, how impacts will be analy2ed, how they will be traced, tracked, and reported, as well as the authori2ation levels re'uired to approve these changes* 4. 1e'uirements prioriti2ation process* 4. "roduct metrics that will be used and the rationale for using them* and 5. !raceability structure that is, which re'uirements attributes will be captured on the traceability matri) and to which other project documents re'uirements will be traced. !he requirements tracea-ility matri% is a table that links re'uirements to their origin and traces them throughout the project life cycle. Product analysis includes techni'ues such as product breakdown, systems analysis, re'uirements analysis, systems engineering, value engineering, and value analysis. Identifying alternatives is a techni'ue used to generate different approaches to e)ecute and perform the work of the project.

A variety of general management techni'ues can be used such as brainstorming, lateral thinking, pair wise comparisons, etc. !he project scope statement describes, in detail, the project( deliverables and the work re'uired to create those deliverables. !he &or' -rea'do&n structure /1(" is a deliverable-oriented hierarchical decomposition of the work to be e)ecuted by the project team to accomplish the project objectives and create the re'uired deliverables, with each descending level of the ;$/ representing an increasingly detailed definition of the project work. !he planned work is contained within the lowest level ;$/ components, which are called &or' pac'ages. 0ecomposition is the subdivision of project deliverables into smaller, more manageable components until the work and deliverables are defined to the work package level. A control account is a management control point where scope, cost and schedule care integrated and compared to the earned value for performance measurement. Control accounts are placed at selected management points in the ;$/. +ach control account may include one or more work packages, but each of the work packages must be associated with only one control account. !he /1( dictionary provides more detailed description of the components in the ;$/, including work packages and control accounts. .nformation in the ;$/ dictionary includes but is not limited to, 1. Code of account identifier, . 7escription of work, 4. 1esponsible organi2ation, 4. 6ist of schedule milestones, 5. Associated schedule activities, 8. 1esources re'uired, A. Cost estimates, B. 0uality re'uirements, C. Acceptance criteria, 1D. !echnical references, and 11. Contract information. 3alidated delivera-les have been completed and checked for correctness by the "erform 0uality Control "rocess. Inspection includes activities such as measuring, e)amining and verifying to determine whether work and deliverables meet re'uirements and product acceptance criteria. Inspections are sometimes called reviews, audits and walkthroughs. 7eliverables that meet the acceptance criterial are formally signed off and approved by the customer or sponsor. !hese are now called ,ccepted 0elivera-les. >ncontrolled changes are often referred to as project scope screep. 3ariance ,nalysis* 7etermining the cause and degree of variance relative to the scope baseline and deciding whether corrective or preventive action is re'uired. 7isagreements should always be resolved in favor of customer. !he cost of creating the ;$/ effort creation is not a factor considered as a challenge to create a ;$/ and is assumed as part of the project. "roject scope statement is considered as the baseline for evaluating change re'uests and for guiding the project team( work through the e)ecuting process. .f project is terminated earlier, the project scope verification process should establish and document the level and e)tent of completion. 1eviews conducted at the end of the project phase on key deliverables and project performance to determine approval for continuance into the ne)t phase and corrective actions are often called kill points, stage gates, or phase e)its. 0uality control is generally performed before scope verification, but these two processes can be performed in parallel. 7efine scope is the process of developing a detailed description of the project and product. !his process should be followed by Create ;$/ process. Falue addition, usually, is a result of implementation of change re'uests. ;hen a project is performed under a contract, contractual provisions will generally be

constraints. Customer satisfaction is the primary criterion for measuring the project success. .f there is a major change to the project, the project manager should try to influence the change to minimi2e the impact on the project. >sually the project manager is advised to do the following, 1. +valuate the impact of the change within the team. . =elp the customer 9or person re'uesting the change: understand the impact of the change. 4. .f changes are in fact re'uired, then open a change control and get the re'uest approved. %bviously, you will have to inform the management and the change control board about the impact of the changes. 4. .f the change control board approves changes, then make appropriate changes in the project plan. .n Create ;$/, decomposition of the total project work into work packages generally involves... identifying and analy2ing the deliverables and related work. +)cessive decomposition can lead to non-productive management effort, inefficient use of resources, and decreased efficiency in performing the work. Falue analysis or value engineering helps determine how to complete the project at a lower budget without any changes to the project scope. !.#+ !he Create /1( process identifies the deliverables at the lowest level in the ;ork $reakdown structure 9;$/:, the work package. "roject work packages are typically decomposed into smaller components called activities that represent the work necessary to complete the work package. Activities provide a basis for estimating, scheduling, e)ecuting and monitoring and controlling the project work. A milestone is a significant point or event in the project. A milestone list identifies all milestones and indicates whether the milestone is mandatory, such as those re'uired by contract, or optional, such as those based upon historical information. Activities are se'uenced using logical relationships. !he project scope statement contains the product scope description, which includes product charactersitics that may affect activity se'uencing, such as th ephysical layout of a plant to be constructed or subsystem interfces on a software project. "7# is a method used in Critical "ath #ethodology 9C"#: for constructing a project schedule network diagram that uses bo)es or rectangles, referred to as nodes, to represent activities, and connects them with arrows that show the logical relationships that e)ist between them. P0M is also called ,ctivity on 2ode ,!2" and is the method used by most project management software packages. "7# includes four types of dependencies or logical relationships, 1. Finish to /tart . Finish to Finish 4. /tart to /tart 4. /tart to Finish .n "7#, finish to start is the most commonly used type of precedence relationship. !he start to finish relationship is rarely used. Mandatory dependencies are those that are contractually re'uired or inherent in the nature of the work. #andatory dependencies are sometimes referred to as hard logic. !he project team determines which dependencies are discretionary. 7iscretionary dependencies are sometimes referred to as preferred logic, preferential logic, or soft logic. 7iscretionary dependencies are established based on knowledge of best practices within a

particular application area or some unusual aspect of the project where a specific se'uence is desired even though there may be other acceptable se'uences. E%ternal 0ependencies invovle a relationship between project activities and non-project activties. !hese dependencies are usually outside the project team( control. A 5ead allows an acceleration of the successor activity. A lag directs a delay in the successor activity. !he composite resource calendar includes the availability, capabilities, and skills of human resources. !he resource -rea'do&n structure is a hierarchical structure of the identified resources by resource category and resource type. +)ample of resource categories include labor, material, e'uipment and supplies. 4esource types can include the skill level, greade level or other information as appropriate to the project. 0uration estimates do not include any lags. (chedule 2et&or' analysis is a techni'ue that generates the project schedule. .t employs various analytical techni'ues, such as critical path method, critical chain method, what-if analysis and resource levelling to calculate the early and late start and finish dates for the uncompleted portions of the project activities. !he critical path method calculates the theoretical early start and finish dates, and late start and finish dates, for all activities without regard for any resource limitations, by performing a forward and backward pass analysis through the schedule network. %n any network path, the schedule fle)ibility is measured by the positive difference between early and late dates, and is termed .total float.. Critical paths have either a 2ero or negative total float, and schedule activities on a critical path are called .critical activities.. A critical path is normally characteri2ed by 2ero total float on the critical path. Eetworks can have multiple near critical paths. %nce a total float for a network path has been calculated then the free float, the amount of time that an activity can be delayed without delaying the early start date of any immediate successor activity within the network path, can also be determined. Critical chain is a schedule network analysis techni'ue that modifies the project schedule to account for limited resources. !he resource-constrained critical path is known as the critical chain. !he critical chain method adds duration -uffers that are non-work schedule activities to manage uncertainity. %ne buffer, placed at the end of the critical chain, is known as the project -uffer and protects the target finish date from slippage along the critical chain. Additional buffers, known as the feeding -uffers, are placed at each point that a chain of dependent tasks not on the critical chain feeds into the critical chain. 4esource levelling is a schedule network analysis techni'ue applied to a schedule that has already been analy2ed by the critical path method. 4esource levelling can be used when shared or critical re'uired resources are only available at certain times, are only available in limited 'uantities, or to keep resource usage at a constant level. 4esource levelling is necessary when resources have been over-allocated, such as when a resource has been assigned to two or more activities during the same time period when shared or critical re'uired resources are only available at certain times or are only available in limited 'uantities. 4esource levelling can often cause the original critical path to change. /imulation involves calculating multiple project durations with different sets of activity assumptions. !he most common techni'ue is Monte Carlo ,nalysis , in which a distribution of possible activity durations .s defined for each activity and used to calculate a distribution of possible outcomes for the total project. (chedule Compression shortens the project schedule without changing the project scope to meet schedule constraint, imposed dates, or other schedule objectives. (chedule Compression techni'ues include, crashing and fast tracking

Crashing only works for activitiees where additional resources will shorten the duration. Crashing does not always produce a viable alternative and may result in increased risk and3or cost. +ast Trac'ing* A schedule compression techni'ue in which phases or activities normally performed in se'uence are performed in parallel. +ast trac'ing may result in re&or' and increased ris'. Fast tracking only works if activities can be overlapped to shorten the duration. "roject schedule is more often presented graphically using one of the formats, 1. #ilestone charts . $ar charts 4. "roject schedule network diagrams $ar charts are easy to ready and fre'uently used in management presentations. For control and management communication, the broader, more comprehensive summary activity, sometimes referred to as a hammoc' activity, is used between milestones or across multiple interdependent work packages, and is displayed in bar chart reports. "roject schedule network diagrams can be presented in the actiivty-on-node diagram format or presented in a time scaled schedule network diagram format that is sometimes called a logic -ar chart. !he schedule baseline is part of the project management plan. /chedule data for the project schedule includes, 1. schedule milestones . schedule activities 4. activity attributes 4. documentation of all identified assumptions and constraints C%/! !he cost management plan establish the following, 1. 6evel of accuracy - rounding off the data to a prescribed precision 9I 1DD, I 1DDD: depending on the scope of the activities and magnitude of the project . >nits of measure eg, staff hours, staff days, weeks or lump sum 4. %rgani2ational procedure links - control account 4. Control thresholds 5. 1ules of performance measurement 8. 1eporting formats - formats and fre'uency for various cost reports. A. "rocess descriptions - descriptions for each of the three cost management processes are documented. !he ;$/ Component used for the project cost accounting is called the control account 9CA:. +ach control account is assigned a uni'ue code or account number 9s: that that links directly to the performing organi2ation(s accounting system. Fariance thresholds for monitoring cost performance may be specified to indicate the agreedupon amount of variation to be allowed before some action needs to be taken. !hresholds are typically e)pressed as percentage deviations from the baseline plan. A Cost estimate is a 'uantitative assessment of the likely costs for resources re'uired to complete the activity. .ndirect costs are those costs that cannot be directly traced to a specific project and therefore will be accumulated and allocated e'uitably over multiple projects by some approved and documented accounting procedure. %ne of the most common constraints for many projects is a limited project budget. ,nalogous cost estimating uses historical information and e)pert judgement. ,nalogous cost estimating is generally less costly and time consuming than other techni'ues, but it is also generally less accurate. Parametric estimating uses a satistical relationship between historical data and other variables 9eg, s'uare footage in construction: to calculate an estimate for activity parameters, such as cost, budget and duration. Prametric estimating can produce higher levels of accuracy depending upon the sophistication and underlying data built into the model.

1ottom#up estimating is a method of estimating a component of work. !he detailed cost is then summari2ed or ?rolled up? to higher levels for subse'uent reporting and tracking purposes. Program evaluation and revie& technique PE4T" uses three estimates to define an appro)imate range for an activity( cost, 1. #ost likely . "essimistic 4. %ptimistic Ce G 9Co<4Cm<Cp:38 !he authorized cost -aseline developed as part of 7etermine $udget includes all authori2ed budgets, but e)cludes management reserves. "roject funds constitute the funds authori2ed to e)ecute the project. "roject cost performance will be measured against the authori2ed budget. 1udget reserve analysis can establish both the contingency reserves and the management reserves for the project. Contingency reserves are allowances for unplanned but potentially re'uired changes that can result from reali2ed risks identified in the risk register. Management reserves are budgets reserved for unplanned changes to project scope and cost. Funding often occurs in incremental amounts that are not continuous, which appear as steps. !he cost performance -aseline is an authori2ed time-phased budget at completion 9$AC: used to measure, monitor and control overall cost performance on the project. .t is developed as a summation of the approved budgets by time period and is typically displayed in the form of an /-curve. !otal funds re'uired G cost as per cost baseline < management reserves. Any increase to the authori2ed budget can only be approved through the "erform integrated change control process Cost estimates involve consideration of costing alternatives, cost tradeoffs, and risks. A comparison of these factors with those from the previous similar projects helps in estimating the project costs for the current project. 6ife cycle costs include the cost of operations, which is beyond the scope of the project. !he life cycle cost includes, 1. 7irect and indirect costs . "eriodic or continuing cost of operation and maintenance Eet "resent Falue 9E"F: G "resent value of all cash inflows - "resent value of all cash outflows .f E"F for "roject A and $ are e'ual, either of the projects can be selected. "resent Falue is the future value of a payment discounted at a discount rate G r for the delay in payment. .n the earned value management techni'ue, the cost performance baseline is referred to as the performance measurement baseline 9"#$:. $enefits are not profits, benefit G revenues or payback. Cost management plan does not include cost estimation, i.e., tools for cost estimating are not used for creation of cost management plan. !hese tools will be used in the +stimate Costs process. "F G FF 3 91 < r31DD:Hn $udget forecasts is one of the outputs obtained from the process control costs. Code of accounts, Any numbering system used to uni'uely identify each component of the work breakdown structure. !he contingency reserve may be a percentage of the estimated cost, a fi)ed number, or may be developed by using 'uantitative analysis methods. As more precise information about the project becomes available, the contingency reserve may be used, reduced, or eliminated. Internal 4ate of 4eturn I44" G 7iscount rate on an investment which makes present value of cash inflows G present value of cash outflows $ottom-up estimating is a method of estimating a component of work. !he cost of individual

work packages or activities is estimated with the highest level of specified detail. Pay-ac' period* Eumber of years re'uired for an organi2ation to recapture an initial investment. 7iscount rate is not taken into account in calculations for payback period. /elect a project with lower payback period. !he to#complete performance inde% is the calculated projection of cost performance that must be achieved on the remaining work to meet a specified management goal, such as the $AC or the +AC. Control thresholds, Fariance thresholds for monitoring cost performance may be specified to indicate an agreed-upon amount of variation to be allowed before some action needs to be taken. !hresholds are typically e)pressed as percentage deviations from the baseline plan. 1ough order of magnitude, < or - 5D J $udget estimate, -1D J to < 5 J 7efinitive estimate, -5J to 1D J 0uality Preventative actions reduce the probability of negative conse'uences associated with project risks. All special cause variations in control chart are addressed by the operator. 0eming said that 'uality is a management problem B5 J of the time. 0uality assurance activities should be performed throughout the project life cycle. %ne of the reasons for adopting statistical sampling for inspection is reducing cost of 'uality control. (pecial cause variation is also called assignable clause. Common causes are the usual, historical, 'uantifiable variation in a system. (pecial causes are unusual, not previously observed, non-'uantifiable version 0uality control is usually performed throughout the project. Inspection is a key tool in 0uality Control process. 0uality audits can confirm the implementation of approved change re'uests including corrective actions , defect repairs and preventive actions. Checklists are simple but effective 'uality management tool that the pm can use to ensure the project team is completing all of the re'uired work. "revention keeps errors out of the process and therefore reduces random variations in the process. .nspection ensures that errors do not reach the customer. !herefore, .nspection usually results in re-work. Control charts are used for the monitoring, controlling and evaluation of process variations. Flowcharting can help the project team anticipate and identify where 'uality problems might occur on the project, which in turn, helps the team develop alternative approaches for dealing with the 'uality problems. !he cost estimates of a proposed project has an e)pected value of 1,DDD,DDD and a standard deviation of 5D,DDD. the project is budgeted for 1,1DD,DDD so as to include a contingency reserve. Assuming that the cost estimates are normally distributed, what is the probability of completing the project over budget K #ean G 1,DDD,DDD, /.7 G 5D,DDD, /.7 G 1,DDD,DDD < L 5DDDD Again it asks about normal distribution. !he 'uestion asks probability of completing project over budget. !herefore we must look at area outside /7 . !he area under the curve for /7 is C5 J. /o the area outside this is 5 J. /ince we are interested in over budget , we must consider

only the area outside the curve to the right of the mean i.e. only half of the area 9the other half would be for under the budget: !herefore 5 J 3 G .5 J 0uality according to modern concept is defined by customer 9aizen is the Mapaneese word for continous improvement. 4un charts show trends in your project by displaying data over time as a line chart. ;ith a run chart you are looking for trends and patterns in the the data over time. 0uality assurance audits should be conducted throughout the project life cycle. Philip Cros-y believed in conformance to re'uirements and 2ero defect. Moseph Muran believed in the fitness for use principal. =e promoted conformance and 'uality by design. 0eming developed the 14 points of !otal 'uality management and said that 'uality is a management problem B5 J of the time. (catter diagrams use an independent and dependent variable and display the relationship between these two elements as points on a graph. Fariance is /7 L/7 !raining for the project team is known as prevention costs. "erform 0uality assurance involves making sure that correct processes are followed with regard to 'uality control. "roject team is responsible for 'uality of all project deliverables /7 G 9"-%:38* "G "essimistic +stimate, % G %ptimistic +stimate Marginal analysis balances the additional benefits from an action against the additional cost. .t is an acknowledgement that decisions should be made based on the incremental gains and losses that result from a decision. 7uality is the degree to which a set of inherent characteristics fulfill re'uirements. 3oice of the customer refers to e)plicit and implicit customer re'uirements that should be captured as part of the project. !he cost of preventing mistakes is generally much lower than the cost of correcting them when they are found during inspection. Cost of 7uality Cost of 1. cost of nonconformance or Conformance failure costs is also . Cost of called cost of poor Eonconformance 'uality. ,ppraisal costs Internal +ailure Costs E%ternal 1. !esting 1. 1ework +ailure Prevention costs* . 7estructive !esting . /crap costs 1. !raining loss 1. 6iability . 7ocument 4. .nspections . ;arranty processes work 4. +'uipment 4. 6ost 4. !ime to do it right $usiness $rade is a category or rank assigned to products or services having the same functional use but different technical characteristics. Precision means the values of repeated measurements are clustered and have little scatter. ,ccuracy means that the measured value is very close to the true value. !he project manager and the project management team are responsible for managing the tradeoffs involved to deliver the re'uired levels of both 'uality and grade. !he project management team must determine appropriate levels of accuracy and precision. #odern 'uality management complements project management. $oth disciplines recogni2e the importance of, 1. customer satisfaction . "revention over inspection - !he cost of preventing mistakes is generally less than the cost of correcting them when they are found by inspection. 4. Continuous improvement - "lan-do-check-act is the basis for 'uality improvement as defined

by /chewart and modified by 7eming. 4. #anagement 1esponsibility

7uality Policy sets the intended direction of a performing organi2ation with regard to 'uality. Cost#1enefit analysis !he primary benefits of meeting 'uality re'uirements can include less rework, higher productivity, lower costs, and increased stakeholder satisfaction. Control charts are used to determine whether or not a process is stable or has predictable performance. >pper and lower specification limits are based on re'uirements of the contract. !hey reflect the minimum and ma)imum values allowed. >pper and lower control limits are set by the project manager and appropriate stakeholders to reflect the points at which corrective action will be taken to prevent e)ceeding specification limits. For repetitive processes, the control limits are generally < or - 4 sigma. A process is considered out of control when a data point e)ceeds a control limit or if seven consecutive points are above or below the mean. Control charts can be used to monitor various types of output variables. 1enchmar'ing involves comparing actual or planned project practices to those of comparable projects to identify best practices, generate ideas for improvement and provide a basis for measuring performance. !hese other projects can be within the performing organi2ation or outside of it and can be within the same or in another application area. 0esign of e%periments 0!E" is a statistical method for identifying which factors may influence specific variables of a product or process under development or in production. (tatistical sampling involves choosing part of a population of interest for inspection. A flo&chart is a graphical representation of a process showing the relationships among process steps. ,ffinity diagrams are used to visually identify logical groupings based on nautral relationships. +orce field analysis are diagrams of the forces for and against change. 2ominal group techniques allow ideas to be brainstormed in small groups and then reviewed by a larger group. Matri% diagrams, include two, three or four groups of information and show relationships between factors, causes and objectives. Prioritization matrices provide a way of ranking a diverse set of problems and3or issues9usually generated through brainstorming: by their importance. !he 7uality management plan describes how the project management team will implement the performing organi2ation( 'uality policy. 7uality management plan* 1. 0uality control . 'uality assurance 4. Continuous process improvement approaches for the project. 7uality metric is a project or product attribute and how the 'uality control process will measure it. Chec'list is a structured tool, usually component-specific, used to verify that a set of re'uired steps has been performed. 7uality chec'lists are used in 0uality control process. Process improvement plan* 1. "rocess boundaries . "rocess configuration - a graphical definition of processes with interfaces identified, used to facilitate analysis. 4. "rocess metrics 4. !argets for improved performance A 7uality audit is a structured, independent review to determine whether project activities comply with organi2ational and project policies, processes and procedures. Process analysis follows the steps outlined in the process improvement plan to identify

needed improvements. Prevention - keeping errors out of the process Inspection # &eeping errors out of the hands of the customer. ,ttri-ute sampling # the results either conforms or does not conform 3aria-le sampling - the result is rated on a continuous scale that measures the degree of conformity. Tolerances # specified range of acceptable results Control limits # thresholds, which can indicate whether the process is out of control. Ishi'a&a: seven -asic tools of quality* 1. Cause and effect diagrams . Control charts 4. Flow charting 4. =istogram 5. "areto Chart 8. 1un chart A. /catter diagram Cause and effect diagrams also called .shikawa diagrams or fishbone diagrams illustrate how various factors might be linked to potential problems or effects. Cause and effect diagrams are also used in risk analysis. +lo&charting is also used in risk analysis. A histogram is a vertical bar chart showing how often a particular variable state occurred. Pareto chart also referred to as a Pareto diagram is a specific type of histogram, ordered by fre'uency of occurrence. 1ank ordering is used to focus corrective action. ;<)=< principle* BD J of the problems are due to D J of the causes. 4un chart show trends in a process over time, variation over time, or declines or improvements in a process over time. 4un chart shows the history and pattern of variation. A scatter diagram shows the relationship between two variables. !he tool allows the 'uality team to study and identify the possible relationship between changes observed in two variables. 7ependent variables versus independent variables are plotted. An inspection is the e)amination of a work product to determine whether it conforms to documented standards. Completed chec'lists* ;hen checklists are used, the completed checklists become part of the project( records. "hilip Crosby defined 'uality as ?>ero 0efects? and ?4ight +irst Time?