10 tips to ease your PMP preparation



Reading the 750 pages of PMBOK as part of PMP preparation is the biggest hurdle most of the PMP aspirants face. These tips are to reduce the pain of PMP preparation. For our PMP prep online, instructor led course details contact us

Protected: Project Cost management

This content is password protected. To view it please enter your password below:

Multifaceted demands on a project manager

Projects are strategic in nature, so are the demands on a project manager. Organizational success, achievement of business goals is directly linked to the successful completion of projects on time, within budget and with quality. The project manager has to cater to the needs of the project, the organization (organizations), industry, professional discipline and across disciplines. Performing integration is the key role of the project manager. Performing integration comprises of the ‘Plan, Do, Check and Act’ of integrating the efforts and work of all to achieve the project goals.

The key stakeholders of the project management role

The project

  • Business analysts
  • Design
  • Engineering
  • Procurement
  • Quality management
  • Risk management
  • Resource management
  • Procurement management
  • Consultants
  • Customer
  • Contractors

The Organization

  • Sponsors
  • Senior management
  • Functional managers
  • Peers (other project managers)

The Industry

  • Industry trends / technological advances
  • Standards organizations
  • Products and prices
  • Competitors
  • Industry benchmarks

Professional discipline

  • Professional bodies like PMI, AACE, Agile alliance, Scrum alliance, PMRI
  • Engineers associations
  • Association of project cost accountants
  • Environmentalists
  • Ethics committees
  • Universities
  • Project management blogging communities
  • Linked in groups
  • Networking with industry experts

Across disciplines

  • Collaborative innovation across disciplines

As we can see, project manager’s is a very strategic role and calls for diverse skills and qualities to cater to the demands of the stakeholders, both internal and external.

PMI’s talent triangle

Skills of a leader

  • Commitment
  • Being a visionary (without total commitment, one will not be able to articulate the vision)
  • Optimistic and inspiring positive attitude
  • Collaborative outlook
  • Relationship building
  • Conflict management
  • Effective communication (Project managers spend about 90% of their time in communication). This include listening skills as well.
  • Demonstrating professional ethics of project managers in all transactions (Responsibility, Respect, Fairness, Honesty)
  • Sharing credit with others
  • Lifelong learner
  • Result oriented
  • Ability to prioritize and focus on important things
  • Ability to manage politics and power and get things done

Performing integration

Projects comprises of multiple sub-teams and even contractors, sub-contractors. Each one of them will have individual plans (engineering plan, design plan,construction plan, procurement plan, quality plan, risk plan, safety plan, scope management plan, schedule management plan etc). All these have to be integrated into a cohesive integrated project plan during the planning phase, and must be continually integrated throughout the project life cycle. During execution, the work packages from these entities have to be integrated. Performing integration at the plan level and at the work package level is a key responsibility of the project manager and she has to have the necessary knowledge, skills and drive to perform this role during the entire project duration

Reference : The project management body of knowledge PMBOK by PMI, USA.

The project environment

Enterprise environmental factors – EEF

  • Organizational culture
  • Organizational structure (functional, matrix, projectized, composite)
  • Distribution of facilities and resources
  • Resource availability (manpower, machine, material)
  • Labor laws
  • Political climate
  • Environmental laws
  • Salary structures
  • Transportation facilities
  • Information systems
  • National holidays
  • Work culture
  • Climatic conditions (Weather conditions)
  • Waste disposal norms
  • Trade unions etc..

Can be internal or external to the organization.

Organizational process assets – OPA

  • Quality management systems
  • Reusable components
  • Proprietary data
  • Processes, procedures, guidelines, templates
  • Lessons learned
  • Databases
  • Project management information systems (PMIS)
  • Management information systems (MIS)
  • Organizational governance frameworks (structures, systems)
  • Organizational structures (Reference PMBOK V6 Page 47)
    • Organic or simple – PM has very less authority
    • Functional – PM has very less authority
    • Multi divisional – PM has very less authority
    • Matrix (cross functional teams)
      • Strong matrix – PM has moderate to high power
      • Weak matrix – PM has low power
      • Balanced matrix – PM has low to moderate power
    • Project oriented – PM has high to almost total power
    • Virtual (distributed teams) – PM has low to moderate power
    • Hybrid – Mix of other types – PM has mixed power
    • PMO (Project management office) – PM has high to almost total power
      • Supportive
      • Controlling
      • Directive

PMBOK structure and Project Success Measures

Projects

Projects are temporary endeavors (have specific start and end dates), delivering unique products or services.

Project and development life cycles

The series of phases a project passes through from it’s start to it’s completion is termed as ‘Project life cycle’ . The phases can be sequential or iterative. Within the project life cycle, there are some phases which are highly technical and contribute directly to the building up of the product of the project. These are known as the ‘Development life cycle’. Development life cycles can be predictive, iterative, incremental, adaptive (agile, iterative or incremental) or hybrid. The development cycles are decided during the project strategy development phase.

Project phases

A project phase is a collection of logically related activities that produces one or more deliverables of the project. Requirements phase delivers requirements document. Design phase delivers design and the design document.

Phase gate

Phase gate, stage gate or kill points are the senior management review of the project conducted at the end of every major phase. They are also known as the go-nogo meetings, as the decision to fund or do not fund the subsequent phase is decided during these meetings.

Project management process groups

  • Initiation
  • Planning
  • Execution
  • Monitoring and controlling
  • Closing

Project management knowledge areas

  • Project integration management
  • Project scope management
  • Project schedule management
  • Project cost management
  • Project quality management
  • Project resource management
  • Project communications management
  • Project risk management
  • Project procurement management
  • Project stakeholder management

There are 49 processes in PMBOK. Each of these processes have a set of inputs, tools&techniques and outputs. Every process in the PMBOK is associated to a ‘Knowledge area’ and a ‘Process group’. For example the process ‘Develop project charter’ is part of ‘Project integration management’ knowledge area and ‘Initiating’ process group. In page number 25 of PMBOK Version 6, this is depicted in detail as a two dimensional array.

During project initiation, planning, execution, monitoring, controlling and closing, enormous amount of data is generated, which gets processed into information and then to reports.

Should we follow every process of PMBOK in every project?. The answer is ‘No’. Based on the nature of the project (magnitude, complexity, engineering discipline etc), project managers must tailor the project management processes for better value.

Project management business documents

  • Project business case – Documented economic feasibility study of the project , generally owned by the project sponsor
  • Project benefits management plan – Processes for creating, maximizing and sustaining the benefits provided by a project. Project manager provides inputs for maintaining these.

Contents of project business case

  • Why are we doing this project?
  • Key stakeholders affected
  • High level scope of the project
  • Analysis of the situation
  • Recommended solutions / alternatives analysis
  • Milestone list

Project benefit management plan

  • Benefit milestones and dates , Benefit owner
  • Alignment of the benefits to the organizational business strategy
  • Benefit measuring logic, systems
  • Assumptions and risks

Project success measures

Establishing the project success criteria with the involvement of all the key stakeholders upfront in a project increases the probability of success. Must be documented and can include;

  • Definition of success for the project
  • Success measuring parameters
  • Critical success factors
  • Adherence to the project business management plan
  • Meeting the agreed upon financial ratios used while justifying the project selection;
  • Net Present Value (NPV) = (Sum of the present value of all future cash flows – initial investment)
  • Return On Investment (ROI)
  • Internal Rate of Return (IRR)
  • Pay Back Period (PBP) – The year in which we can take recover the initial investment from the project
  • Benefit Cost Ratio (BCR) = (Sum of the present value of all future cash flows) / Initial investment

References : PMBOK Version 6 Pages , TCM Framework

Why are the processes in PMBOK numbered from 4 onwards?

The processes in PMBOK are numbered from 4 onwards because chapters 1,2,3 contains the topics given below.

  • The standard for project management
  • The standard for portfolio management
  • The standard for program management
  • Code of ethics and professional conduct
  • Projects
  • Project initiation context
  • Projects, programs, portfolio and operations management
  • Organizational project management and strategies
  • Structure of PMBOK
  • Project and development lifecycles
  • Project phase
  • Phase gate
  • Project management processes
  • Project management process groups
  • Project management knowledge areas
  • Project management data and information
  • Tailoring
  • Project management business documents
  • Project business case
  • Project benefits management plan
  • Project charter and project management plan
  • Project success measures
  • Enterprise environmental factors
  • Organizational process assets
  • Organizational systems
  • Organizational structure types
  • Project management office
  • The role of the project manager
  • Project manager competencies
  • Comparison of Leadership and management
  • Performing integration

Project integration management comes under chapter 4. The first process under this knowledge area ‘Develop project charter’ is numbered at 4.1.

Project stakeholder management

If we can maintain the project stakeholders satisfied throughout the project, then the project is successful. The first step towards this is aggressive stakeholder identification and stakeholder’s expectation management. The positive expectations must be maximized where as the negative expectations must be minimized. While the stakeholder register will vary across projects, the following list contains the most common project stakeholders;

  • The sponsor (the entities funding the project)
  • Project managers (Owner’s PM, Contractor’s PM, Consultant’s PM, Discipline wise PMs)
  • Program managers (If the project under consideration is part of a program)
  • Portfolio managers (If the project under consideration is part of a portfolio)
  • Project management office (PMOs)
  • Consultants
  • Team members
  • Supervisors
  • Equipment manufacturers / Suppliers
  • Procurement management teams
  • Risk management teams
  • Quality management teams
  • Safety department
  • Planning department
  • Competitors
  • Statutory bodies

I am sure that a detailed analysis will extend this list further. If we have to perform a detailed stakeholder analysis, we need to;

  1. Identify the stakeholders
  2. Perform stakeholder analysis
  3. Manage stakeholder engagement in the project

The following two blog post of mine published at  Wrench elaborates these concepts further;

The art of managing project stakeholders – Part 1 

The art of managing project stakeholders – Part 2

 

The output of the stakeholder analysis is the stakeholder classification into the quadrants

stakeholderanalysis

The high power / low interest category of stakeholders must be kept informed about the project progress using a milestone chart (summary level information). The high power / high interest category of stakeholders must get more detailed view of the project at frequent intervals in the form of   Milestone charts, High level schedules, Risk rating matrix, Project ‘S’ Curves etc. The Low power / Low interest category can be ignored. The Low power, High interest category must receive the project progress details at a frequency which will ensure their interest in the project. Very often, the low power – high interest category is very powerful as a segment. For example :- The product review bloggers. They are the opinion leaders, and they must be proactively managed.

Summary

Stakeholder engagement is one of the critical success factors for every project. Project managers must proactively plan for effective stakeholder identification and management throughout the project. Since stakeholders power is directly linked to their organizational structure (functional, strong matrix, weak matrix, balanced matrix, projectized, composite), a proper study of the stakeholder’s positions, and their organizational structures will help in better project risk management and communications management.

pmp_kochi_kerala_india

 

 

Understanding Earned Value Management System (EVMS)

Scope of the project : This project comprises of laying a fence around a square plot of size 1 km on each sides (A,B,C,D). Each side has a budget of 1000. The work is supposed to get over on the 4th week. The surveyor is conducting the survey to assess the progress after 4 weeks from the start date.

Side A, Side B, Side C are fully completed.

The Budgeted Cost of Work Scheduled BCWS(A), which is also known as the Planned Value (PV) for A = 1000

Since ‘A’ got over, the Budgeted Cost of Work Performed BCWP(A), which is also known as Earned Value (EV) for ‘A’  = 1000

The Actual cost (AC) incurred to complete side A = 1000

For SIDE – B,   PV=1000, EV=1000, AC=1000

For SIDE – C, PV=1000, EV=1000,  AC=1000

For SIDE – D, PV=1000, EV=500, AC=800

evm example 1 (1)

EVMBAC (2)

Conclusion 

A Schedule Performance Index (SPI) =>1 indicates the project is doing well schedule wise

A Schedule Performance Index (SPI) < 1, indicates that the project is lagging behind schedule wise

If the Cost Performance Index (CPI) >=1, indicates that the work is getting completed within budget

A Cost Performance Index (CPI) < 1 indicates that we have spend more than planned for the completed work.

Throughout the project if we can maintain a CPI and SPI which is greater than or equal to one, then the project is doing well schedule wise and cost wise. 

The ‘S’ Curve

The ‘S curve’ is widely used in project management to track the project. At regular intervals they plot the Planned Value (PV), Earned Value (EV) and the Actual Cost (AC) . If SPI=1 and CPI=1, then all these curves would have intersected at PV.

Badget-at-Completion-EVM-for-SharePoint

The Budget at Completion (BAC) is the sum of ‘PV’ of all the work from start of the project till the end.

Based on these data, it is possible to forecast the Estimate at Completion (EAC)

EAC = AC + (BAC-EV) / CPI  (Assumption, the nature of the work is same)

 

pmp_kochi_kerala_india

Multi dimensional risk analysis for PMP

Here is a multi dimensional risk analysis for the PMP credential from the industry, trainer, PMP aspirant perspectives with an intent to communicate an independent and unbiased view. 

pmprisks

Industry related risks 

  1. The risk – There is a wide spread rumor about PMP credential as a product, which has reached the end-of-life stage in the product life cycle.  Reality – While this can be true from the training providers perspective due to too many trainers / companies undercutting each other, this is never true from the project management professional’s / aspiring professional’s perspective. PMP still rules as most recognized certification for predictive project management (most suited for large projects involving engineering, procurement, construction and management (EPCM). PMP credential is followed by PRINCE2. There is no other choice as of now for anyone who wants to pursue a globally accepted predictive project management related certification based on Plan, Do, Check, Act (PDCA) by Deming. I am using the term ‘predictive project management’ explicitly because there are many popular certifications available under the agile family (SCRUM, XP, RUP, TDD etc..) which are not a right fit for EPCM projects where the engineering discipline does not allow for much change, hence the agile family of frameworks are more suitable for product development where the requirements and the technology are highly volatile. Even then I am toying with the idea of applying agile during the planning phase of EPCM projects. Do not pelt stones at me because I am talking differently, or because I am the only one talking so. Unfortunately the agilists and the traditionalists do not like each other very much, even when the scrum masters fail miserably because they do not have any clue about stakeholder management, risk management, communication management, resource management, scope management, quality management etc. In my personal opinion, predictive and adaptive (agile) project management streams are complimentary  in nature for those whose goal is to manage their projects successfully, without bias towards any one particular framework.

Trainer related risks

  1. Many trainers teach the inputs, tools and techniques and outputs of the project management processes, in the same sequence as they are listed in the project management body of knowledge (PMBOK), without focusing on the benefits. That makes it very boring and difficult to remember (note that PMBOK is a 750+ page document). A better approach would be to learn process group wise;
    • Initiation
    • Planning
    • Execution
    • Monitoring & Controlling
    • Closing – This approach makes it easy to remember, as this is the natural flow of the project.
    • processgroupwisedoclist
  2. Many trainers provide too much emphasis on remembering inputs, tools&techniques and outputs (ITTO). Remembering them for 49 processes is humanly impossible, especially when one is under exam pressure. In fact, surprisingly those who spent maximum effort to mug up ITTO during their preparation time have failed in the final exam. Once you understand PMBOK process group wise, it is easy to recollect logically the inputs, tools&techniques and outputs. For example remembering the ITTO for the process ‘Develop project charter’ is much easier when one looks at it as the first process under ‘Project initiation’ process group, than the ‘First process’ under ‘Project integration management’ knowledge area.
  3. They do not give any emphasis on the ‘professional ethics’ of project managers. You can imagine the plight of someone who tries into master professional project management without any idea about professional ethics. Since the questions are scenario based, every project management scenario has an ethics angle, and mastering it makes it easier while choosing the best project management decisions.
  4. PMBOK has a wealth of information for the project management practitioner. Many trainers lacks the experience to articulate the concepts from the practitioner’s perspective. For example, project charter can be explained as just an output of project initiation or it can be a great document to develop a well understood project success criteria among all stakeholders..
  5. Trainers may not be well versed with various project domains to cite the right examples, whereas the participants are from different domains. They end up seeing everything as a nail, because the only tool they have is a hammer.
  6. Trainers trying to showcase their knowledge than focusing on the knowledge transfer. Mostly with inexperienced trainers.
  7. Trainers who does not explain things in detail, due to monotony. Mostly with highly experienced trainers.
  8. Trainers recommending too many reference material, thus making the preparation difficult.
  9. Trainers who charge very less fees, who losses interest mid way through the course because they are not compensated enough for their efforts.
  10. Disillusioned trainers, who are wearing the trainer’s hat out of compulsion than by choice.

Learner related risks

  1. Underestimating the effort required. One need to spend atleast 80 hours of preparation time, which include training, self study and exam practise.
  2. Over confidence, hence insufficient preparation.
  3. Lack of confidence, hence not scheduling the exam and finally dropping the idea.
  4. Enrolling for cheap courses, just because they are cheap, without giving any weight age for trainer profile, method of training and track record. Online courses which are just record and play, which are priced lower than the price of books is the number one culprit. Think of the frustration, re-preparation effort and the re-registration fees after failing in the first attempt. Passing PMP in the first go is very important. Do not decide based on the direct costs alone, consider the indirect costs (especially the cost of failure) as well, before deciding on the training program.
  5. Try to finish it off at the earliest, preferably within 30 days of the course completion, else other priorities may take precedence.

pmpinjust5weeks