Project Control Management Content

IIL-PEC
2014 International Institute for Learning, Inc.
GS-1
Project Execution and Control
Participants Notes:
Getting Started
Introductions
Please write your name on the name tent
provided.
When the instructor calls on you, please state
your name, and then briefly describe your
background or current job assignment and
your education, training or experience in
project management.
Also, please share at least one interest that
you have outside of work.
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Getting Started
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GS-4
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Getting Started
You will be given information pertaining

to the location of restrooms and
scheduled breaks.
Be aware of the location of exits for your
own safety in the event of an
emergency. Your instructor may give you
specific instructions if necessary.
Please turn off cell phones and pagers.
Please refrain from using e-mail during
class time; check e-mail only during
breaks.
To get the most out of this class, your
active participation is encouraged.
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GS-5
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Getting Started
Each module builds upon the knowledge,

skills, and techniques you learn in the prior
modules, so by the end of the course, you will
have a complete understanding of this course
content.
GS-6
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Getting Started
Please review the course goal within the

context of your work environment.
GS-7
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Getting Started
Please review the objectives. By doing so, you

will be able to focus your attention on the
areas that this course is intended to address.
GS-8
Participants Notes:
Getting Started
We may have a wide variety of starting

experience and knowledge in this classroom.
Be willing to contribute where you have
specific knowledge and experience.
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GS-9
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Getting Started
You can expect each module to flow as

follows:
A module overview is presented, and
learning objectives are outlined.
Concepts, tools, and techniques are
introduced, and exercises are integrated
to support learning points.
The module is reviewed, and youll have
an opportunity to ask additional
questions.
A learning journal is provided at the end

of each module, so you can make note of
your insights, and how you might apply
them to your own projects.
We invite you to contribute your comments,
questions, and observations as they occur,
during question opportunities and during
breaks.
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GS-10
Participants Notes:
Getting Started
This discussion will be used as a background

to anchor the course in the real world.
Solving the problems and resolving the issues,
within the learners scope of control and
influence, becomes the motivation for the
remainder of the class.
It also sets the expectations each learner has
for the course.
Please take a moment to think about and list
your expectations to share with the class.
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GS-11
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1-1
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Foundation Concepts

content.
1-3
Foundation Concepts
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1-4
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Foundation Concepts
*Materials in this class are substantially

aligned with the Project Management Institute
(PMI), A Guide to the Project Management
Body of Knowledge (PMBOK Guide) Fifth
Edition, Project Management Institute, Inc.,
2013.
PMIs standards and certifications are
recognized on a global scale.
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1-5
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Foundation Concepts
Some examples of single-release products are:

Buildings
Consulting services
Examples of multiple-release products are:
IT applications
Consumer electronics
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1-6
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Foundation Concepts
The 42 project management processes are

grouped into five categories known as the
Project Management Process Groups.
Not all of the real world interactions among
the Process Groups and Knowledge Area
processes can be documented, however, we
will look at a summary of the discrete
processes and how they generally work
together in delivering projects.
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1-7
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Foundation Concepts
The Project Management Standards

Framework clearly lays out the typical
landscape of a projects journey.
Note the emphasis on Planning and
Controlling. Although not necessarily more
important than the other process groups,
most practitioners agree that it is in these
processes where the Project Manager has the
greatest opportunity to impact project
performance. And if they had to choose the
one most critical group, most would say
Planning.
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1-8
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Foundation Concepts
This exercise will be conducted either as a full

class activity or as a break-out session with
groups of up to 5 people.
1-9
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Foundation Concepts
Use the chart to rank project management

issues.
Rank each issue on a scale of 1 (low) to
5 (high) with regard to both frequency
and criticality.
Discuss the differences and come to a
class or group consensus on the top 3 - 5
issues.
Identify project management tools and
techniques that may address these top
issues.
Consider two or three areas where you
feel you need to perform better on your
projects.
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1-10
Foundation Concepts
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1-11
Foundation Concepts
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1-12
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Foundation Concepts
This event will be conducted as an open

forum, inviting contributions from all
participants.
1-13
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Foundation Concepts
Moving learners from reactive to proactive

behaviors is one of the primary goals of this
learning experience. The traditional concept
of triple constraints, along with its more
updated persona called competing
demands, provides exactly what we need!
1-14
Foundation Concepts
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1-15
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Foundation Concepts
Project Management theory has always

recognized that, in order for a project to be
successful, the project manager has to
balance multiple competing factors, or project
drivers.
Traditionally, the demands were known as the
triple constraints (depicted on this slide to
the left). Those triple constraints varied,
depending on the practitioner discussing them
(e.g., schedule, scope, cost schedule,
performance, cost, etc.). Later the list
expanded to six competing demands.
PMBOK Guide Fifth Edition recognizes six

competing constraints that need to be
balanced and prioritized by the project
manager in order to maximize the probability
of achieving project success.
- PMBOK Guide Fifth Edition, p. 47
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Foundation Concepts
This event will normally be conducted in

groups of 3 or 4 people in break-out sessions,
with a class debrief to follow.
An alternative approach, as classroom timing
dictates, this event can be conducted as a full
class activity.
You may use the worksheet on the next slide
to record your discussions.
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1-17
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Foundation Concepts
Use this worksheet to record your groups

deliberations.
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Foundation Concepts
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1-19
Foundation Concepts
A project life cycle (PLC)

Is a collection of project phases:
Generally sequential
Sometimes overlapping
Sometimes Iterative (Agile, Spiral, Rapid Prototyping)
Sometimes Phased (Large Systems Development)
Differentiates its phases by name and number as determined by:
Management and control needs of the organization
Nature of the project
Projects area of application
There are many similar versions of PLCs, which may vary by (but are not limited to):
Organization
Industry
Technology
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Foundation Concepts
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Foundation Concepts
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Foundation Concepts
Each phase review is a decision point Go/No

Go.
Evaluate:
Compliance with program objectives
Internal and external environmental
changes
Critical performance metrics
Progress to schedule
Projected cost, margin, revenue, life-cycle
cost, etc.
Deliverables for requirements compliance
Use a standard set of questions to facilitate
these decision points.
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Foundation Concepts
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Foundation Concepts
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Foundation Concepts
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Foundation Concepts
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Foundation Concepts
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Foundation Concepts
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2-1
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Scope Management

content.
2-3
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Scope Management
Review these performance-based learning

objectives carefully.
2-4
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Scope Management
The Work Request is the first document used

in beginning the requirements definition
process. It outlines the business need for the
project, along with objectives. It identifies the
customer audience and begins to define
assumptions and constraints for the project.
2-5
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Scope Management
The Project Proposal is created to gain a highlevel understanding of the project. It provides
a general idea of the scope of the project,
which is derived from the Requirements
Overview document. It provides background
on the business case for the project, as well
as a preliminary assessment of the risks for
the project. An idea is given of the project
duration and identified constraints and
assumptions are documented.
This document may also be used as a basis
for comparing competed projects in the overall
project governance process.
Business Case A documented economic
feasibility study used to establish validity of
the benefits of a selected component lacking
sufficient definition and that is used as a basis
for the authorization of further project
management activities.
PMBOK Guide Fifth Edition, Glossary
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2-6
Participants Notes:
Scope Management
Develop Project Charter The process of

developing a document that formally authorizes the
existence of a project and provides the project
manager with the authority to apply organizational
resources to project activities.

Charters normally include:
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Project description
Business need for project
Product description key deliverables, if

known
Objectives/constraints cost and schedule
Project scope (inclusions and exclusions)
Key stakeholders and roles
Project managers authority and responsibility
Risks
Assumptions
2-7
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Scope Management
The preliminary scope statement generally

provides the project stakeholders with
information about why the project was
selected, a summary of the product, service,
or result that will be delivered at the
completion of the project, a summary-level
explanation of major deliverables, and the
project objectives that have been established.
The project objectives will be easier to
validate upon completion if they are clear and
measurable.
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2-8
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Scope Management
Business objectives are the reasons for

performing the project. For example, reducing
cost, eliminating errors, etc. Because IT
projects are often embedded in a higher order
project (e.g., business process redesign or
development of a new product or service for
sale to customers), IT professionals need to
address business issues.
Project (technical) objectives define the
product or the physical outcome of the
project, by a given date, for a given cost. The
project objective is a means to the end of the
business objective. This information is being
asked for in the Project Request.
Phase, Activity, or Task objectives are the
specific outcome of the performance of a task
within the project. These objectives are
associated with specific task deliverables.
They contribute cumulatively to the project
objectives.
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2-9
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Scope Management
The CHAOS Report produced by The Standish

Group International (1995) indicates that the
major reasons that information technology
projects are behind schedule and over budget
is due mainly to incomplete or changing
requirements or the quality of the customer
relationship.
But before we can define detailed
requirements, we need to start with the
objectives defined in the project charter, as
defined in the previous module. For there, we
need to confirm the deliverables in the scope
statement also developed in Initiating (but will
be covered here in this module), describe the
work it will take to achieve those deliverables
(WBS), then write the detailed requirements,
with possibly several iterations before we have
a baseline document. Lets look at how this
critical process plays out.
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Scope Management
Product Scope
The features and functions that
characterize a product, service, or
result.*
High-level product scope sets the
framework for subsequent requirements
development activities.
Project Scope
The work performed to deliver a product,
service, or result with the specified
features and functions.*
High-level project scope becomes part of
the scope baseline for the project
*PMBOK Guide Fifth Edition, Glossary
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2-11
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Scope Management
Development of a detailed scope statements is

crucial for successful project outcome. As
major deliverables are defined, constraints
and assumptions are documented. This
provides for clear direction as the project is
initiated.
Scope definition subdivides the major project
deliverables into smaller, more manageable
components. This will assist in developing
more accurate cost, duration, and resource
estimates.
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2-12
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Scope Management
At this point, the team continues to work

through the tools and techniques, iteratively
refining and progressively detailing the scope
until the baseline scope statement is created.
Develop 2030 questions, using the key
words, to enhance the discovery process.
There are multiple levels of detail to provide
clear understanding of the product, service or
results desired.
Use diagrams and graphic representations to
support the written descriptions of the
deliverables.
An example of the graphics and diagrams
might be for an internal process improvement
project, a picture of the as is state based on
corporate dashboard results with a description
of the to be end result expected as a project
outcome.
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2-13
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Scope Management
Business objectives drive the project; they

provide the measures of ultimate project
success. What happens if business objectives
are unclear? Project objectives are the means
to the end of business objectives. What
happens if project objectives are unclear?
Requirements and scope management
transfers knowledge from the users and
customers to the product developers and the
project team. This facilitates effective decision
making by both clients and senior
management.
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Scope Management
Scope Management Plan a component of

the project or program management plan that
describes how the scope will be defined,
developed, monitored, controlled, and verified.
Project Scope Management includes the
processes required to ensure that the project
includes all of the work required, and only the
work required, to complete the project
successfully.

Based upon the project needs, the Scope
Management Plan may be informal or formal,
generalized or with a high level of detail.
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2-15
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Scope Management
The WBS structure must be related to the

objectives of the project. It is derived from the
project objectives, and is used as a framework
for defining project activities and tasks. It
ensures that the total scope of work is
defined. It defines tasks and relates them to
only one specific work effort so activities are
not omitted or duplicated.
Work that is outside of the WBS is outside of
the scope of the project. Often, the WBS is
used to develop or confirm an understanding
of the project scope.
Top-down view of how project activities
fit into the overall project structure
Each descending level increases in
detailed description of project
deliverables
Lowest deliverable level often referred to
as work package
Work packages may be subdivided into
activities, which can be further
subdivided into tasks
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2-16
Scope Management
Full Development Projects These projects provide new or enhanced system functionality, which supports
the business processes.
Vendor Development Projects Any new or enhancement projects where a vendor/third-party company is
involved in providing the solution.
Minor Development Projects These projects are trivial improvements to existing applications for which the
business requirements are clearly defined in the business case or documentation without additional analysis and
that do not exceed 80 man-days of CMB Technology effort.
Work Order Projects Improvements to existing applications for which the Business requirements are clearly
defined in the business case and that do not exceed 5 man-days of CMB Technology effort .
Agile Projects A new software development methodology based on the Iterative life-cycle approach. This
methodology is currently in a Pilot mode and is not available to the entire organization as a process standard;
hence projects approved by the Methodology Team can only follow the CMB Technology Agility Process Standard
for Project development effort.
Support Project Types:
The following are the various other work types that are called Projects, but are not considered to be
development projects and more of a support work nature:
Development Support Projects (DS)
Production Support Projects (PS)
Program Management Projects (PgM)
Business Consultancy Projects (BC)
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2-17
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Scope Management
Once the project requirements have been

defined, tasks to deliver the requirements
need to be analyzed through a process called
decomposition. The result of this process is
called a Work Breakdown Structure (WBS).
Potential structural models:
Phases
Deliverables
Product features
Cautions
Avoid breakdown by disciplines
(e.g., sales, trading, marketing, training,
etc.)
Dont worry about sequencing (yet)
Make sure every WBS element has one
or more deliverables
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Scope Management
The high-level deliverables listed in the WBS

are defined as part of the Scope Statement.
Each of those high-level deliverables is then
broken down into more detail to continue to
elaborate the requirements of the project.
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Scope Management
The construction of a new office building

delivers a tangible product by using several
elements. The product elements start with the
Level 2 construction and flow down to the
Level 4 tasks with concrete shown as an
example.
The Level 2 tasks for design, procurement,
and commissioning are integrating tasks; all of
the elements of the construction task require
input from these to be complete. Project
management is shown as a separate element
and has input into all of the other elements.
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Scope Management
As the work is defined to lower levels of detail,

we arrive at tasks. This unit of requirement is
usually determined by the ability to assign it
to one individual or a small group of
individuals usually from 40-80 hours of
work.
Work Package The work defined at the
lowest level of the work breakdown structure
for which cost and duration can be estimated
and managed.
WBS Dictionary document that provides

detailed deliverable, activity, and scheduling
information about each component in the
work breakdown structure.
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Scope Management
The Task Activity Description provides

more specific information in regard to unit of
work. It facilitates the assignment of work,
once the project begins. It should also provide
the details of the work to be performed. This
document provides the lowest level of
requirement.
Activity A distinct, scheduled portion of
work performed during the course of a
project.
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Scope Management
Contingency Reserve Budget within the

cost baseline or performance measurement
baseline that is allocated for identified risks
that are accepted and for which contingent or
mitigating responses are developed.
Management Reserve An amount of the
project budget withheld for management
control purposes. These are budgets reserved
for unforeseen work that is within scope of the
project.
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Scope Management
Progressive Elaboration The iterative

process of increasing the level of detail in a
project management plan as greater amounts
of information and more accurate estimates
become available.
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Scope Management
This diagram displays the process of

elaborating project scope. There are key
deliverables that are created as part of the
scope definition process.
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Scope Management
Since projects are dynamic in nature, change

is inevitable. Therefore, having tools in place
to manage the change is critical to project
success.
Additional factors include:
Determining that a change has occurred
Determining change impact
Managing the actual changes when and
if they occur updating the plan
Perform Integrated Change Control The
process of reviewing all change requests;
approving changes and managing changes to
deliverables, organizational process assets,
project documents, and the project
management plan; and communicating their
disposition.
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Scope Management
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Changes to Business Requirements

Requested changes during the SDLC
must be recorded, reviewed, approved
by all affected parties, tracked, and
controlled. In addition to the tasks
around the change request itself, it is
also required that the impact on the
overall project effort and timeline be
evaluated. This process acts as the
vehicle to ensure the integrity of the
baseline deliverables as well as to track
incremental development costs.
Changes to Project Plan
All project work products must be

documented, controlled, and stored
within the Project Management Tools
used by the Project.
Guidelines for this responsibility are

documented in the PMBOK Guide
chapter on Integration Management.
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Scope Management
Changes to any one area of knowledge must

be integrated into the total change control
process to ensure the big picture is considered
for each change.
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Scope Management
Scope Creep The uncontrolled expansion

to product or project scope without
adjustments to time, cost, and resources.

The change control process will also assist in
detecting changes that are not submitted as
requests. These changes can be schedule
slippages and cost overruns. Both are changes
to the project plan and must be addressed.
These types of changes are detected by
comparing work results with project plans.
Any variance to the plan is considered a
change and must be analyzed to determine
the impact on the projects end date or the
customers level of satisfaction.
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Scope Management
Except for customer acceptance, Closing

activities upon IT project completion typically
occur after the developed system or
application is migrated into production, or at
Go-Live.
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Scope Management
Closing the project is not something that

happens at a moment in time. It requires
planning and action to preserve an orderly,
useful set of information for:
Using the product
Maintaining the product
Improving performance on future
projects
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Scope Management
Validating the project scope includes reviewing

deliverables to ensure that each is completed
satisfactorily. This process can be performed at
major milestones, end of phase reviews, or at the
end of the project. It is designated as a Monitoring
and Controlling process by the PMBOK Guide
Fifth Edition, Table 3-1, p. 61, but we cover it here
in Closing because of its natural relationship to
other Closing processes and the obvious
importance of the last iteration of scope verification
to signal the close of the project.
If the project is terminated early, the project scope
validation process should establish and document
the level and extent of completion. Validate Scope
differs from Control Quality in that the former is
primarily concerned with acceptance of
deliverables, while the latter is primarily concerned
with meeting the quality requirements. Control
Quality is generally performed first, but the two
processes can be performed in parallel.
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Scope Management
Lisa K. Westerback, Department of Commerce, describes a situation in which a standard training

program, for all users of a new desktop e-mail, appointments, and application access software
package (the more efficient choice), was rejected in favor of a more effective segmented training
approach. The segments were:
IT geniuses (who clamor for new technical horizons)
Technically adept (who welcome advances and see applications to business goals)
Technologically impaired (recalcitrant users who fear and hate technology of any kind)
After treating the first two groups with appropriate levels of standard training and the last group
with individualized attention, Only one concern marred the otherwise successful implementation.
Some of those in the truly recalcitrant category, though in the end accepting and approving of the
new software, criticized the special attention they received. Surely, they thought, the resource
cost for the individualized consultations must have been exorbitant to learn to use such simple
software!
Make executive stakeholders a special segment and plan for their continual contact, culminating in
a complete buy-in at a final project presentation.
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Scope Management
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3-1
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Project Scheduling

content.
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Project Scheduling

3-4
Project Scheduling
A resource is any tangible entity, such as a person, tool, supply item or facility used in the
performance of a project. Resource planning, including estimating, must be performed before
estimates of time and cost can be developed. And because there are basic concepts and best
practices that apply regardless of the project environment and tools available, a categorical
resource checklist helps to expedite the planning.
Resource categories include:
People (in-house, critical liaisons and/or contract personnel)
Materials (supplies, goods, etc. specific to product being produced)
Equipment (heavy to light office type and/or items also specific to product being produced)
Services (outsourced components, e.g., market research, or support services, e.g.,

overnight delivery, as well as other services specific to product being produced)
Regardless of whether you agree with the value of a categorical checklist, almost everyone
agrees that human resources our people are the most valuable resource and essential
achieving project success.
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Project Scheduling
Resources must be managed in a way to

ensure that individual projects produce
expected outcomes. Therefore, resource
planning includes the:
Identification of the types and number of
resources required for the kinds of projects
that are expected to be performed
Identification of gaps between the resources
needed and the resources available, and
well as viable options to fill the gaps
Application of planning tools that will aid

resource planning and management
The three topics that follow will address the
implementation of these resource planning
activities in detail. However, we will spend
most of our time on the first two activities of
the three.
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Project Scheduling
Resource requirements are foundational to the

estimating and scheduling process, and resource
assignments are best suited at the work package or
activity level.
The following points will provide guidance on the
application of the Resource Requirements Matrix.
Categorize the resource(s) by People, Materials,

Equipment and Services
Identify the required performance level for each
resource
Estimate the quantity of each resource
Verify and decide upon the hourly rate for

human resource or equipment lease
Estimate the duration and effort for human
resource, and duration for equipment lease
Establish start and end dates for resource and

% of time resource is allocated (this helps with
negotiations)
Include comments on working assumptions, such

as commitments, availability, physical location
and source
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3-7
Project Scheduling
When identifying resource requirements, dont forget the client, sponsor, etc. If the S in
sponsor is made to look like a dollar symbol ($) by drawing a line through it, it could be a
reminder that the sponsor is a crucial project resource. Also, keep in mind those in the
requesting organization, i.e., the customer. End users and support staff are vital, and possibly
members of the community, if the initiative is government funded. These resources, and perhaps
others, are project stakeholders who must be considered during the identify resource
requirements activity.
What could happen if the organization delegated project management responsibility to one who
lacked the knowledge to manage the effort or is marginally available? Do you think the project
would be negatively impacted? The result would be the same irrespective of the resource
identified. If the appropriate knowledge is lacking to perform the task and or the person was
unavailable, then negative impacts would be the outcome. When identifying resource
requirements, ensure resource availability, required skill and performance levels.
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3-8
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Project Scheduling
If we must look outside our organization to fill a

resource gap, then procurement is a viable option.
Market conditions and procurement practices may
warrant consideration of a sole, single, or multiple
source supplier.
Sole sources exist when a single seller controls
the supply of products or services in a defined
market. These situations are usually the product of
market conditions such as technology leadership,
patent protection, limited/exclusive franchise
distributorships, mergers and acquisitions, etc.
Single source selections are usually driven by
objective business decisions; such as leveraged
volume purchase contracts, standardization
programs/systems, parts/service provided by an
original equipment manufacturer, consistency of
quality/batch control, just in time delivery
requirements, etc. Single source selection based
purely on personal preference or subjective
rationale should not be sanctioned.
Multiple source selection is driven by the
availability of more than one suppliers in the
market and is facilitated by sound
proposal/sourcing processes.
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Project Scheduling
The project manager is responsible for

describing the project needs relative to
specifications, drawings, delivery dates,
estimated costs, and input to decision-makers
about whether to make or buy goods and
services from outside the performing
organization. In either case, we also must
take into account capital investments versus
expense for tax purposes.
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Project Scheduling
The PMBOK Guide Fifth Edition Glossary

further elaborates on the definition of an
estimate saying that it is:
Usually applied to project costs, resources,
effort and durations and is usually preceded
by a modifier (i.e., preliminary, conceptual,
feasibility, order-of-magnitude, definitive),
[most of which we will explore in more detail
in Module 4 of this course]. It should always
include some indication of accuracy (e.g., + x percent).
Unlike the budget process, project scheduling

is NOT the simple result of cumulative
durations. If that were true, the project would
be a string of serial activities linked from start
to finish and we would never be able to meet
customers expectations!
In this course, our first priority is to address
estimating activities that support project
scheduling, the heart of the course being
Modules 2-5. A secondary objective is to
address the related processes which are
addressed in Modules 6 and 7.
IIL-PEC
3-11
Participants Notes:
IIL-PEC
Project Scheduling
Now that we know how to provide the answer

and the data behind the answer to the first
two questions posed, we will move on to
addressing the third scheduling question: How
long will it take? The answer will encompass
estimating perspectives, approaches,
techniques, methods within each technique,
characteristics of good estimating, etc., as will
soon be evident.
3-12
Participants Notes:
IIL-PEC
Project Scheduling
To expand on the answers to the question of

How do we develop estimates, we explore
each one of the five approaches listed above.
3-13
Participants Notes:
Project Scheduling
Rolling wave is often used as a best practice in

project management, especially for initiatives that
span multiple years, because it allows incremental
refinement of estimates over the project life.
Given an estimate used to baseline is provided in
Phase 1, the next phase should have sufficient
detail to provide a more accurate estimate. Beyond
Phase 2 details are not available to estimate within
the confidence level to baseline, and this is
acceptable.
The rules for rolling wave follows, assuming in
Phase 1:
Estimates for Phase 2, should be a budget

estimate used to re-baseline +/- 10%
Estimates for Phases 3 5 should be soft
>/= plus or minus 20% , depending on the
span of years and complexity
As the graphical representation shows, initially, an
estimate provided in Phase 1 of the project will
have the greatest range. This reflects a lack of
confidence and or accuracy in the estimate. The
Phase 2 would result in an estimate with a smaller
range, reflecting greater accuracy and a higher
level of confidence, because more information or
details are available at that point in time.
IIL-PEC
3-14
Participants Notes:
Project Scheduling
An order of magnitude or rough order of

magnitude (ROM) uses past experience, scale
factors, parametric curves or capacity
estimates to achieve its level of accuracy.
An analogous (budget) estimate is prorated
from previous projects that are similar in
scope and capacity to achieve its level of
accuracy. It is a systematic hybrid between
facts and experience, and requires data
collection. After a sufficient amount of data
are collected, empirical adjustments are made
that take into account: project duration and
complexity; size of team and competencies of
team members; overtime expenditures;
development and test environments.
The parametric estimate uses statistical data,
i.e., a dollar amount per square foot, or
parametric curves. The appropriate algorithm
or curves can be applied at many levels of the
WBS, and often produces an estimate slightly
better in accuracy than analogous estimating.
IIL-PEC
3-15
Participants Notes:
Project Scheduling
Bottom-up or definitive estimates are prepared

from vendor quotes, fairly complete plans,
specifications, unit prices, and estimates to
complete; and bottom-up estimates have the
greatest level of accuracy when compared to topdown estimates.
Single-point estimates time in effort and or
duration. Effort is a function of the base estimate
and productivity factors. Duration is a function of
effort, work calendar factors (vacations and
holidays), as well as risk.
Consider the following to arrive at a single point
estimate:
Assign each activity within a work package a

single estimate
Aggregate each activity estimate into an

estimate for the work package. (This
facilitates monitoring and controlling the
schedule and budget.)
3-point, multi-point or PERT estimates require 3
separate estimates to calculate the mean, an
expected time, for an activity. (See the slides that
follow for more detail.)
IIL-PEC
3-16
Participants Notes:
Project Scheduling
Program Evaluation and Review Technique

(PERT) uses 3 time estimates. Keeping in
mind all the factors that can impact estimates,
this method is:
The most accurate in developing the
individual activity estimate
The most mature, well-known
PERT was developed in 1958 and 1959 by the
United States of America (USA) Navy for the
Polaris submarine program and is still used
successfully by the USA DoD for some of their
large engineering projects.
IIL-PEC
3-17
Project Scheduling
PERT uses the mean of a beta distribution, which is a weighted average, to calculate duration estimates
that have factored in some element of risk. The accuracy, and therefore the confidence, of activity duration
estimates using this approach are improved by considering estimation uncertainty or risk. PERT calculates an
Expected (t) time using a weighted average of three estimates, as shown in the formula above. Consider
the following, when using PERT:
1. Estimate the most PESSIMISTIC (tP) value REALISTICALLY, which is based on the worst-case
scenario.
2. Estimate the most OPTIMISTIC value (tO) REALISTICALLY, which is based on the best-case scenario.
3. Determine or estimate the MOST LIKELY (tM) value, given the resources likely to be assigned, their
productivity, realistic availability of the resources when needed, dependencies on other participants and
interruptions.
4. Use the formula to calculate the weighted average estimate.
Note: Make certain you enlist a subject matter expert to aid in the estimating, using this method. And
consider it for any critical activities, that is activities that are on the critical path, and activities that have
significant risk associated with them. Additionally, PERT could be used estimating effort, cost, linear feet of
material, tons of raw material, energy needed, lines of code, time for UAT, liters of fluid and the number of
help desk calls per day.
IIL-PEC
3-18
Participants Notes:
Project Scheduling
PERT introduces time buffers by considering

estimate contingencies or risks. Over the life of
the project, these defensible buffers can increase
the likelihood of completing the project on time.
We will explain more about the advantage of
using this method in Module 6 Budget, Risk
and Contingency Planning. And in Module 7, we
will see how PERT can help to achieve more
realistic baselines.
IIL-PEC
3-19
Project Time Management
In order to calculate the probability of completing a project within a certain timeframe perform the
following:
1. Calculate the expected duration (tE) of each activity on the critical path.
2. Calculate the standard deviation of each activity on the critical path.
3. Square the standard deviation of each activity on the critical path to get each activitys variance.
4. Add up the expected durations (tE) of the activities on the critical path to get the expected duration of
the total project.
5. Add up the variances (NOT THE STANDARD DEVIATIONS) of each activity on the critical path to get
the variance of the total project.
6. Calculate the square root of the variance of the total project to get the standard deviation of the project
(this is not the same as adding the individual standard deviations from the activities.)
7. Add/subtract the standard deviation from the projects expected duration (or mean) to get each
increment on the normal curve in order to calculate the probability of finishing the project relative to a
specific date.
The probability of getting the project done within 16 weeks is 50% + .5 (68%) = 84%
Within 17 weeks, we have 50% + .5 (95%) = 97.5%
Within 14 weeks, we have 50% - .5 (68%) = 16%
Within 13 weeks, we have 50% - .5 (95%) = 2.5%

Adapted from Project Management: A Systems Approach to Planning, Scheduling, and Controlling, 11 th
IIL-PEC
3-20
Project Scheduling
Edition, by Harold Kerzner, Ph.D., p. 618.
Participants Notes:
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1-20
Participants Notes:
Project Scheduling
Level of Flexibility:
Mandatory dependencies are referred to
as hard dependencies because
activities with this attribute must be
sequenced in a certain order
Discretionary dependencies are referred
to as soft dependencies because the
logic relationships are not absolute, but
based on preferred practice
Level of Control:
External dependencies extend beyond

the project team and the direct control of
the project manager
Internal dependencies are contained
within purview the project team and the
direct control of the project manager
IIL-PEC
3-21
Project Scheduling
Participants Notes:
IIL-PEC
3-22
Participants Notes:
Project Scheduling
The CPM is performed without regard to

resource availability and is therefore
theoretical. CPM calculates early and late
dates or time periods, based on the sequence
of activities as defined in the network diagram
and the duration estimates for the activities.
The critical path is the sequence of activities
that represent the longest path through a
project, which determines the shortest
possible duration. A critical path activity is
any activity on the critical path in a project
schedule.
Critical Path Method: A method used to
estimate the minimum project duration and
determine the amount of scheduling flexibility
on the logical network paths within the
schedule model.
IIL-PEC
3-23
Participants Notes:
Project Scheduling
On any network path, the schedule flexibility

is measured by the positive difference
between early and late dates, and is termed
total float. Critical paths may have positive,
zero, or negative total float depending on the
constraints applied.
In the examples that will follow for the critical
path method, total float will need to be
determined for each activity.
IIL-PEC
3-24
Participants Notes:
Project Scheduling
There will be more on float calculations, and

its use when we apply the CPM.
In the example shown:
Total float = late finish (LF) early finish (EF)
IIL-PEC
3-25
Participants Notes:
Project Scheduling
In the conventions shown, the name of the

activity is positioned in the middle of the box
with the duration of the activity directly below
it.
The top-left corner of the box contains the
early start date, and the top-right corner of
the box contains the early finish date.
Similarly, the bottom-left corner of the box
contains the late start date, and the bottomright corner of the box contains the late finish
date.
We will discuss how to determine or calculate
each of these values via the Critical Path
Method.
IIL-PEC
3-26
Participants Notes:
Project Scheduling
A forward pass is performed from left to right

through the network. This process will identify
the early start and early finish for each
activity. Start with one for the first activities
to get the initial early start dates, and then
add the duration to the early start and
subtract one to get the early finish for each
activity.
In the forward pass process, the greater value
of the early finish for all predecessors is
always used (and incremented by one) when
multiple predecessors converge onto one
successor. Remember: the predecessors
early finish is incremented by one to get the
early start for the successor.
The early finish for the last activity in the
network is also the project duration.
Therefore the duration for the schedule
network shown is 18 work periods.
IIL-PEC
3-27
Participants Notes:
IIL-PEC
Project Scheduling
A backward pass is performed starting from

right to left. It will determine the late start
and late finish for each activity. Start by
inheriting the early finish for the late finish in
the last activity (H), and then subtract the
duration from the late finish (and add one) for
the late start. The lesser value of all successor
tasks that converge from a predecessor (and
decremented by one) is used as the late finish
for the predecessor, as in activity B.
Remember: the successors late start is
decremented by one to get the late finish for
the predecessor.
3-28
Participants Notes:
Project Scheduling
This slide illustrates the old CPM calculation

that PMI used in previous versions of the
PMBOK Guide.
After the ES and EF are determined by the
forward pass and the LS and LF are
determined by the backward pass, one can
calculate the float for each activity. The float
can be calculated by:
Float = Late Finish - Early Finish
or
Float = Late Start - Early Start
Although both formulas will provide you with
the same answer, it is advisable to use both
formulas to verify the correctness of your
results for the forward and backward pass.
In summary:
Float > 0 (time is available)
Float = 0 (situation is critical)
Float < 0 (project is behind schedule)
IIL-PEC
3-29
Participants Notes:
IIL-PEC
Project Scheduling
The critical path, as we learned, is the path of

activities that has float that is less than or
equal to zero. Therefore, the critical path is
denoted by A, C, G, H.
3-30
Project Scheduling
Participants Notes:
IIL-PEC
3-31
Participants Notes:
Project Scheduling
Start with a schedule that balances the

competing constraints by first:
Using an unconstrained approach, i.e. do
not back into a given date
Assuming resources will be available
when they are needed
Using FS precedence relationships as
much as possible for the precedence
diagram
Employing the CPM
Review the initial draft of a completed
schedule, and then apply any or all of the
optimizing techniques to make the needed
adjustments. At this point, it is appropriate to
use a scheduling tool to enter all activities,
precedence relationships, planned dates, and
resources.
The optimizing techniques listed above will be
addressed in the balance of this module.
IIL-PEC
3-32
Participants Notes:
Project Scheduling
The basic principles to resource leveling are:

Monitor resource loading to avoid over
allocation
Ensure critical path activities get the
highest priority when loading
Make adjustments in resource
assignments to activities that have
positive float, if applicable
Adjust effort and duration as needed,
such as when the number of resources
allocated must change or the skill level of
resources change
Resources need to be leveled when the
allowable time period for a resource is
exceeded. The usual result of resource
leveling is a longer activity and or project
duration. The usual result of not leveling is
over allocation of human resources, burnout, and an increase in attrition.
IIL-PEC
3-33
Participants Notes:
Project Scheduling
Fast tracking and crashing both bypass best

practices to accelerate the schedule.
Therefore both options will introduce
additional risk into the project.
Be sure to assess the risk and advise
accordingly when considering these methods
of compression.
IIL-PEC
3-34
Participants Notes:
Project Scheduling
Crashing is one of the most over rated

schedule optimization techniques in the
business. Crashing is not effective, if
additional resources do not have the skills or
bring continuity into the project, as in having
familiarity with the project history. Adding
resources can not only add confusion, but also
result in higher costs and undue risks that
mount up to something beyond the time
savings thought possible.
USE WITH CAUTION!!
IIL-PEC
3-35
Participants Notes:
Project Scheduling
Fast tracking is used to reduce project

duration when the logical relationships
between activities can be changed. This
technique is applicable only between activities
with discretionary attributes. This can be
achieved by:
Changing the precedence relationship of
2 activities from finish-to-start to startto-start or finish-to-finish. or impose a
lead.
Moving an activity off of the critical path

into an existing path
Moving an activity off of the critical path
and creating a new parallel path
IIL-PEC
3-36
Project Scheduling
Participants Notes:
IIL-PEC
3-37
IIL-PEC
4-1
Participants Notes:
IIL-PEC
Quality Management

content.
4-3
Participants Notes:
IIL-PEC
Quality Management

4-4
Participants Notes:
Quality Management
Quality should be planned in, not inspected in. The plan

should comply with known standards, regulations, or
company policies based on the product of the project.
It is a good practice to invest in prevention and
appraisal efforts, establish how quality will be measured
throughout the project, and be certain the end result
will conform to the customers stated requirements.
Productivity, cost, and quality all contribute to
profitably satisfying the customer.
The characteristics of quality may be viewed in terms of:
Degree of excellence (e.g., good, average, poor)
An attribute, trait, or faculty
Fitness for a particular purpose
Attributes are properties that cannot be measured

directly but, nevertheless, can be recognized and
appreciated. A valued attribute in the food and drink
industry would be taste. Those industries producing
household goods may have a quality attribute of
appearance. The textiles industry might be more
attuned to tactile property attributes such as softness,
warmth, and stiffness.
IIL-PEC
4-5
Quality Management
Customer satisfaction
is accomplished by meeting customer requirements by evaluating, defining, and
Participants
Notes:
managing expectations.
Preventing errors in a process is typically less expensive than fixing them by inspection.
Success in projects and organizations requires the involvement of all members of the team, management must
provide the resources needed to ensure success.
Continuous improvement is referred to in Japan as Kiazen. This is the process as described by Shewhart and
Deming as plan-do-check-act.
The cost of quality is broken down into two areas, the cost of conformance and the cost of non-conformance.
Quality. The degree to which a set of inherent characteristics fulfills requirements.
Grade. A category or rank used to distinguish items that have the same functional use, but do not share the
same requirements for quality.
Precision. A measure of exactness.
Accuracy. An assessment of correctness.

While sometimes a lower grade is specified after a cost-benefit analysis - lower quality is not acceptable.
Precision is related to repetitiveness. The ability to hit the same point over and over again, while accuracy
deals with hitting the value that is specified.
IIL-PEC
4-6
Quality Management
Participants Notes:
IIL-PEC
4-7
Participants Notes:
Quality Management
Plan to Assure the Process is Right

Before finalizing the quality plan, you should understand
what quality acceptance looks like, so the plan reflects
the criteria of stakeholders.
There are nine basic steps in the quality planning
process:
IIL-PEC
1.
Review the documents for quality language.
2.
Identify a quality team and leader.
3.
Identify plan components and owners.
4.
Negotiate specific quality assurance (QA)

requirements.
5.
Plan the (QA and quality control (QC)) steps for

the project.
6.
Educate the project team on QA/QC guidelines.
7.
Incorporate QA/QC tasks into the project plan.
8.
Get client sign-off.
9.
Implement plans for QA/QC data
4-8
Quality Management
Cost of quality refers to the total cost of all efforts to achieve product, service, or result quality. Remember
Crosby and his quality is free slogan?
Cosby was referring to the notion that the cost of prevention and appraisal should be a part of the cost of
doing business, and should not be viewed as separate and distinct. Prevention refers to designing quality
inallowing for project team member, end user or customer training and mapping out a quality strategy
before you jump in to keep you on course. Appraisal refers to pre- and production inspections, tests, or
sampling that is done to assure the final product will be within the product specification levels.
Design reviews, training, and quality planning are associated with the costs associate of prevention activities.
Inspections, lab tests, and in-process testing are costs associated with appraisal activities.
Juran spoke often of the cost of not conforming to quality and was speaking of the impact of internal and
external failure. Internal failures are those that occur before leaving the organization and include scrap,
rework, repair, and defect evaluation. This causes costs to rise and employees to get disgruntled about
having their efforts wasted. The goal is to design quality in, so there is little to catch at the inspection phase.
External failures are those discovered by the customer and include returns, complaints, corrective action, and
field maintenance. There is no way to know the true cost of external failures. Unhappy customers may
complain to their friends and acquaintances about the failure, and you will never know what the loss of that
business might be. If loss of life occurs because of an unsafe product, the cost is immeasurable.
In the 1930s, Juran was one of the pioneers who first considered the idea that there were legal implications
associated with the lack of quality, such as civil or criminal liability, appropriate remedies in court and the
notion of express or implied warranties.
IIL-PEC
4-9
Participants Notes:
Quality Management
When used in quality planning, costs and

benefits consider the trade-offs to ensure a
constant focus on stakeholder satisfaction and
on the bottom line. In other words, the
benefits of our quality activities should
outweigh the costs.
Benchmarking allows comparisons of the
results among projects, which are used as a
basis of measurement to generate ideas to
improve performance.
Design of experiments is a statistical method

that assists in identifying factors that may
influence variables to find the most acceptable
product combinations.
IIL-PEC
4-10
Participants Notes:
Quality Management
The American Society for Quality (ASQ) states,

Quality assurance is all the planned and
systematic activities implemented within the
quality system that can be demonstrated to
provide confidence a product or service will
fulfill requirements for quality.
Quality assurance is a bit of a misnomer
because it is not specifically about quality, but
mostly about ensuring compliance with
process.
In any case, the operative word is

assurance, which, according to ASQ, is the
act of giving confidence, the state of being
certain, or the act of making certain.
IIL-PEC
4-11
Participants Notes:
Quality Management
Quality assurance is assuring that the quality of the

product or service you are providing the customer
is as agreed according to the service level
agreement, statement of work, or contract. So
another task of the project manager, distinct from
the QA role, is confirming that all customerprovided product specifications are clearly
documented in the scope of the project. Next the
project manager will identify how delivery of the
product specifications will be confirmed during the
project and at time of customer inspection or
testing prior to turnover.
For example, in operational information systems,

"quality" might be defined as the number of times a
system completely and successfully executes
without failure or interruption. One way to assure
that level of quality would be to measure and
report the number of executions run and their
success / failure ratios during product testing.
IIL-PEC
4-12
Participants Notes:
IIL-PEC
Quality Management
An interrelationship diagraph is one of a family

of diagrams that helps to explain the cause
and effect relationships between elements in a
project. The Interrelationship Diagraph may
be developed with the help of other tools,
such as, the affinity diagram, the fishbone
diagram and the decision tree diagram. It
allows one to systematically identify, analyze
and categorize the cause and effect
relationships that exist between critical issues.
4-13
Participants Notes:
Quality Management
Among the objectives of a quality audit are:
Identify where you are
Identify good practices
Do a gap analysis
Provide assistance in improving productivity
Intended outcomes from a quality audit:
IIL-PEC
Planned project quality is met
Products are safe and fit for use
All laws and regulations are followed
Data systems are accurate and adequate
Proper corrective action is taken when

required
Improvement opportunities are identified
4-14
Participants Notes:
IIL-PEC
Quality Management
Cause-and-effect diagrams, also called

Ishikawa diagrams or fishbone diagrams,
illustrate how various factors might be linked
to potential problems or effects.
4-15
Participants Notes:
Quality Management
While there are many styles, two types of flow

charts are generally used. One is a process flow
chart and the other is a system flow chart. An
example of a process flow chart is shown. They
both graphically display how various elements of a
process or system relate. As a project progresses,
understanding the tasks and decisions that occur in
any given process can help the project team
anticipate what and where quality problems might
surface, which helps the team to develop
approaches for dealing with them.
A common format for flow charts is known as the
SIPOC model. This flowchart shows the relationship
between:
IIL-PEC
Suppliers
Inputs
Process
Outputs
Customers
4-16
Participants Notes:
IIL-PEC
Quality Management
Listed are the seven primary tools for quality.

We will explore each of these in more detail
when we get to Control Quality.
4-17
Participants Notes:
Quality Management
The Pareto diagram is named after Vilfredo

Pareto, a nineteenth century Italian economist who
postulated that a large share of wealth was owned
by a small percentage of the population. This basic
principle translates well into quality problems. Most
quality problems result from a small number of
causes. Quality experts often refer to the principle
as the 80/20 rule, which means that 80% of
problems are caused by 20% of the potential
sources.
A Pareto diagram puts data in a hierarchical order
from most occurrences to fewest occurrences,
suggesting that the highest number of occurrences,
if resolved, would produce the greatest
improvement. When seeking operational or process
improvement project opportunities within an
organization, this can be a helpful tool in deciding
what to fix first. While the Pareto diagram will point
to the biggest culprit of failed throughput, the other
factor to consider is the cost of correcting that
error. Although it can summarize all types of data,
the Pareto analysis technique is used primarily to
identify and evaluate nonconformities.
IIL-PEC
4-18
Participants Notes:
IIL-PEC
Quality Management
As indicated in the slide, the histogram

consists of a series of bar charts that shows a
distribution of data. The columns represent
and information attribute describing a
situation. The height of each bar represents
the frequency of occurrence of each item
listed. This tool provides an excellent means
to identify problems in a process by the
display of each distribution.
4-19
Participants Notes:
Quality Management
A typical control chart is a graphical display of

a quality characteristic that has been
measured or computed from a sample or as
results of a process. Remember the transition
in history from craftsman to mass production?
In attempting to manufacture 10,000
muskets, a pattern for interchangeable parts
was designed for unskilled workers to use.
The discovery at that time was that even
though there were repeatable processes,
slight variation still occurred, even with design
patterns.
The question is, will those variations allow the
pieces to fit together in the final product and
still work? We have a target (the exact
pattern) and specification limits (slight
variances from the pattern) that will still allow
the parts to fit together and work. Those limits
are referred to as upper specification limits
and lower specification limits.
IIL-PEC
4-20
Participants Notes:
Quality Management
The quality control chart contains a line in the

center that represents the average of two other
horizontal lines, called the upper control limit (UCL)
and the lower control limit (LCL). These are set by
the company, rather than the customer, and are
intended to be more rigorous than the customers
expectations, which are represented by the
specification limits. These control limits are chosen
so that if the process is in control, all of the sample
points will fall between them. As long as the points
plotted are within the control limits, the process is
assumed to be in control, and no action is
necessary.
However, a point that plots outside of the control
limits is interpreted as evidence that the process is
out of control, and investigation and corrective
action is required to find and eliminate the
assignable, or special causes responsible for this
result. The data points are plotted connected with
straight line segments for easy visualization.
IIL-PEC
4-21
Participants Notes:
IIL-PEC
Quality Management
The process is in control when no obvious

abnormalities appear in the control chart.
This is the desirable process state.
4-22
Participants Notes:
IIL-PEC
Quality Management
A process is out of control when the data

points exceed either the upper or lower
control limits.
4-23
Participants Notes:
Quality Management
If there is a continued rise of all in a series of

points, this pattern is called a trend. In
general, if seven consecutive points continues
to rise or fall, there is an abnormal condition.
(Project Management: A Systems Approach to
Planning, Scheduling, and Controlling,
11th Edition, by Harold Kerzner, Ph.D., p.
1050)
IIL-PEC
4-24
Participants Notes:
Quality Management
When several successive points line up on

one side of the central line, this pattern is
called a run. The number of points in that run
is called the length of the run.
There is abnormality in the process if the run
has a length of seven points.
Project Management: A Systems Approach to

1049
IIL-PEC
4-25
Participants Notes:
Quality Management
A control chart that displays a hugging pattern

will have several points near a warning or
control limit. There is abnormality if 2 out of
3 points, 3 out of 7 points, or 4 out of 10
points lie within the outer one-third zone.
Project Management: A Systems Approach to

1051
IIL-PEC
4-26
Participants Notes:
Quality Management
Scatter diagrams organize date using two

variables and the relationship or correlation is
shown on a simple graph with X and Y
coordinates. The correlation can be negative,
positive, or curvilinear, or the data might be
represented as having no correlation at all.
Trend analysis is then used to statistically
quantify the relationships of the data and is
highly useful in forecasting or predicting what
is likely to occur in the future.
IIL-PEC
4-27
Participants Notes:
Quality Management
Statistics are a tool that can help us make

sense of available data. While measuring if the
final product of the project will meet the
customers critical to quality characteristics
(CTQ), we may choose to select only a portion
of the final lot to confirm we met the mark.
Testing some, rather than all, can help
substantially reduce the cost of conforming to
quality, as long as we get a valid
representation of the whole in the sample size
we select.
Attribute sampling result either conforms or
not
Variable sampling result rated on a scale to
measure the degree of conformity
IIL-PEC
4-28
Participants Notes:
IIL-PEC
Quality Management
Inspection, while not intended to be the only

quality tool, is still a viable tool along with
other planning elements such as design of
experiments, etc.
4-29
Quality Management
Six Sigma methodology is a systematic method for improving the output of the organization by improving
the quality of the system. his is done by preventing errors, solving problems, managing change, and
monitoring long-term performance.
Six Sigma is a quality management model that incorporates a strategy using statistical tools within a
structured methodology to gain the knowledge needed to deliver products and services better, faster, and
less expensively than the competition.
Six Sigma represents six standard deviations from the mean to the upper and lower specifications limits.
Measurement is the foundation of Six Sigma. You cant improve what you dont know. In order for
organizations to improve, they must know whats important and how theyre doing at delivering whats
important.
Once theyve done that, theyll be able to clearly see the gaps. Six Sigma is a carefully designed, top-down
initiative used to align the entire operation.
At the highest level, the executives are trained on the fundamental concepts of Six Sigma and their role as
corporate champions. Those goals are then passed down to the mid-level operational management levels.
These individuals are also trained on the fundamental concepts, as well as how to identify high impact
problem areas and how to serve as the project champions. Those projects are given to the Black Belt or
Green Belt project leaders to reduce defects and eliminate non-value add cost using the DMAIC
methodology. It is a total alignment of the organization.
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4-30
Quality Management
Participants Notes:
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4-31
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5-1
Participants Notes:
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Budget, Risk, and Contingency Management

content.
5-3
Participants Notes:
Review these learning objectives carefully.

The learning content contained within this
module is based on these learning objectives.
At the end of this module or the end of the
course, you should be able to answer quiz or
test questions related to these learning
objectives.
If you are participating in this course for
certification, you will be better prepared to
pass a certification exam by recalling these
learning objectives.
IIL-PEC
5-4
Participants Notes:
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5-5
Think back to Module

3 when we first developed an activity list. We made certain assumptions
Participants
Notes:
about human and other resource availability, competence, reliability, and considered other
influencing factors to estimate resources. And in Module 4, we made assumptions, based on
resource requirements to estimate time. Now we must do something similar to estimating
activity costs. We need to make assumptions about direct and indirect costs, and then include
funds for contingency reserves additional funds, based on risks.
The checklist shown will ensure the appropriate costs are included for each activity and that no
costs are inadvertently omitted.
Additional indirect costs that may need to be considered include: freight, testing and inspection,
spare parts, insurance, escalation, permits and licenses, special packing, special shipping, duty,
and exchange rate
We will discuss how to establish contingency reserves for costs when under the topics of Project
Risk Management and Contingency Reserve Planning, later in this module.
IIL-PEC
5-6
Participants Notes:
The learning curve concept can be applied to

help us to make correct assumptions
regarding costs, and then apply the cost
adjustments that are required, due to the
considerations that follow:
Practice provides improvement
More experience lower cost
Less experience higher cost
Conclusions about the learning curve:
The amount of time required to perform
an activity decreases as more units are
produced and activities are repeated.
The amount of improvement or rate of
improvement decreases as more units
are produced.
The rate of improvement has sufficient
consistency to allow its use as an
estimating or prediction tool.
IIL-PEC
5-7
Participants Notes:
When estimating costs, use units of measure,

such as staff hours or staff days along with
their cost estimates expressed in units of
currency.
The currencies on this page are: Dollar, Euro,
Kronor (Sweden, Denmark and Norway),
Chinese Yuan, Pounds, South African Rand,
and Japanese Yen.
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5-8
Exercise Input
TOP-DOWN ESTIMATING TECHNIQUES (CONSTRUCTION
AND IT)
Top-Down Estimating Techniques

1.
Equipment factored estimates
Equipment factored estimates can be used on work packages that include a significant
amount of original equipment manufacturer (OEM) equipment, such as the major equipment in
a chemical process. The estimate is based on the concept that the equipment cost can be
determined early in the project definition phase, and that the equipment cost, as a percentage
of the total project cost, can be estimated based on historical data.
An equipment factored estimate is calculated using the following equation:
C = (E/f) * (1+i) where,
C = cost estimate
E = sum of estimated cost for major equipment (provided by equipment suppliers)
f = percent of direct cost for equipment (equipment factor)
i = percent indirect costs are of direct costs
For a sample project, the estimated equipment cost is $368,000. Based on historical
information, equipment constitutes 62% of direct costs, and indirects are 18% of directs.
C = ($368,000/0.62) * 1.18
C = $700,387
a.
b.
IIL-PEC
What level of accuracy could be achieved with this estimating technique?

What data does your company have that could support the development of
equipment-factored estimates?
5-9
Analogous estimates
Analogous estimates base the estimate for a new project on historical data from previous,
similar projects. But the cost information must be adjusted to account for the difference
between the projects. Two key adjustments that should be made are for inflation and project
location.
Adjustments are made using the following equation:
C2 = C1 * (F2/F1) where,
C2 = cost of new project
C1 = cost of old project
F2 = factor for new project
F1 = factor for old project
Inflation can be adjusted by using cost indices, such as the Engineering News Records
Construction Cost Index (CCI). The CCI is published monthly to reflect the changing costs of
construction.
For example, if a previous project was built in July, 2004 (CCI = 6076) for a cost of $258,500,
and a new, similar project was to be built in March, 2008 (CCI = 6636), the new estimate would
be:
C2 = C1 * (CCI2/CCI1)
C2 =
C2 =
Location can be adjusted using location factors such as those published by the USA Corps of
Engineers in EM 1110-2-1304, Civil Works Construction Cost Index System (by states), or those
published by R. S. Means (by cities). The location factor is a multiplier that accounts for the cost
of construction at various locations and is based on a national average of 1.00. Locations with
a multiplier greater than 1.0 are above the national average; those less than 1.0 are below the
average.
For example, a project was completed in Springfield, MA (location factor = 102.2) for $258,500.
What would the project cost in Chicago, IL (LF = 110.9)?
C2 = C1 * (LF2/LF1)
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5-10
Multiple adjustments can also be made. A project was performed in Springfield, MA (LF =
102.4) in January, 2007 (CCI = 6000) for a cost of $359,400. A similar project will be in
Florence, SC (LF = 74.0) starting in March, 2010 (6636).
C2 = C1*(CCI2/CCI1)*(LF2/LF1)
C2 =
C2 =
a.
b.
3.
What level of accuracy could be achieved with this estimating technique?

What data does your company have that could support the development of
analogous estimates?
Unit-based algorithms
For Construction:
Unit-based algorithm estimates are based on a key project parameter that can be determined
with some level of accuracy early in the life of the project. For the Nashville Office Building, the
key parameter would be square feet of office space. The cost of the new facility would be
estimated based on the historical cost per square foot of previous projects. Unit-based
algorithms should account for economies of scale. The cost per square foot of a 150,000 SF
structure will be lower than the cost per square foot of a 40,000 SF structure. A scaling factor is
used to account for the economies of scale.
Sample scaling factors are:
Industrial process 0.6
Commercial space 0.7
Warehouses 0.9
The lower the scaling factor, the more economy of scale for the particular type of project. The
following equation is used to estimate using the scaling factor.
C2 = C1 * (F2/F1)S where,
s = scaling factor
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5-11
For example, if a 79,000 SF office building costs $5,688,000, how much would a 60,000 SF
office building cost?
C2 = C1 * (F2/F1)S
C2 =
C2 =
C2 =
This approach assumes that the projects have similar amounts of common areas, quality of
finishes, etc.
For IT:
Unit-based algorithm estimates are based on a key project parameter that can be determined
with some level of accuracy early in the life of the project. For the Integrated Project
Management System, the key parameters would be 1) the number of components in the legacy
system that must be integrated and 2) the number of new components to be installed. The cost
of the system would be estimated based on the historical cost per component or process in
past projects. Unit-based algorithms should account for economies of scale. The cost per
component of a 15-component system will be lower than the cost per component in a 4component system. A scaling factor is used to account for the economies of scale.
Software Code Development 0.6
Hardware Intensive Systems 0.7
New Systems or Components 0.9
The lower the scaling factor, the more economy of scale for the particular type of project. The
following equation is used to estimate using the scaling factor.
C2 = C1 * (F2/F1)S where,
s = scaling factor
For example, if a hardware intensive 7,900 GB data warehouse cost $5,688,000, how much
would a 6,000 GB data warehouse cost?
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5-12
C2 = C1 * (F2/F1)S
C2 =
C2 =
C2 =
This approach assumes that the projects have similar physical surroundings and share
common software products.
4. Combining analogous estimates and unit-based algorithms
For Construction
Analogous estimates and unit-based algorithms can be combined to incorporate multiple
adjustment factors. The model may be made as complex as data available allow. Assume the
Nashville Office Building project (LF = 0.85) is to be started July, 2010 (CCI = 6695). CPC has
cost data from two previous, similar projects:
a. Mobile, AL (LF = 0.80); started in May, 2007 (CCI = 6006); 48,000 SF; cost of
$3,613,000.
b. Columbia, SC (LF = 0.76); started in Sept., 2008, (CCI = 6391)); 56,000 SF; cost of
$3,900,000
Adjusting Mobile project yields:
C2 = C1 * (CCI2/CCI1) * (LF2/LF1) * (SF2/SF1)S
C2 = $3,613,000 * (6695/6006) * (0.85/0.80) * (60,000/48,000) .7
C2 = $3,613,000 * 1.115 * 1.063 * 1.169
C2 = $5,006,000
Adjusting Columbia projects yields:
C2 = C1 * (CCI2/CCI1) * (LF2/LF1) * (SF2/SF1)S
Average estimated cost = ($5,006,000 +
Average estimated cost =
)/2
For IT:
Analogous estimates and unit-based algorithms can be combined to incorporate multiple
adjustment factors. The model may be made as complex as data available allow. Assume the
IIL-PEC
5-13
Participants Notes:
In construction, the cost per square foot of a

150,000 SF structure will be lower than the
cost per square foot of a 40,000 SF structure.
A scaling factor is used to account for the
economies of scale.
Industrial process 0.6
Commercial space 0.7
Warehouses 0.9
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5-14
Participants Notes:
IIL-PEC
You now know the elements to consider when

estimating costs and how to employ various
estimating techniques, such as top-down,
unit-based, and equipment-based. After all
activity costs are estimated, then we can
move forward to determine the project
budget. Lets turn our focus to determining
the budget.
5-15
Participants Notes:
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5-16
Participants Notes:
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If there is a need to constrain the budget, be

aware of trade-offs. Ask yourself if the savings will
justify the total investments over the life of the
product?
Cost of quality includes investments to

conform to requirements and are associated
with reviews, testing, and design.
Investments in the product due to
nonconformance are due to defects, scrap,
warranties, and liabilities. These are
investments that we plan to avoid.
Product has to do with both revenue

generation and investments in maintenance
releases throughout the product life, which is
not the same as product support
Product support is associated with business

operations that give stakeholders the
assurance that the product is being monitored
to guarantee it services the business or
delivers the business benefits as intended.
5-17
Participants Notes:
Necessity is the mother of invention. This

axiom is never truer than when a threat or
opportunity presents itself as a result of risk
management.
Consider these examples:
Your company will incur penalties if the

project delivers late. So, you look for
alternatives to accelerate the schedule and
deliver on time, while maintaining quality
and not reducing the scope of work, to
reduce the threat.
Your company will receive a bonus if your
project delivers early. Therefore, you
employ only the best resources who are
known to the most efficient to realize this
opportunity.
Although both types of risks (threat and

opportunity) were present, the overall plan
would include all options to leverage the
potential for a positive outcome. This is how
risk management works!
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5-18
Participants Notes:
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Each risk management process will be

addressed under this topical heading.
5-19
Participants Notes:
IIL-PEC
People tend to do their best work in crisis

mode. We support each other with immediacy
and caring, regardless of personal
circumstances. Observe the behavior that
occurs during a natural catastrophe to see
that this is true. Our focus is on addressing
the immediate need, by performing the task at
hand. Project managers could respond to
project risk in much the same way. However,
a reactive response can be costly and
exhausting. Therefore, Project Risk
Management is a proactive, which is simply
good business, because it provides clients with
a sense of confidence in the potential project
outcome.
5-20
Project risks diminish naturally as the life cycle of the project unfolds, and the project is
completed. The purpose of risk management is to drive risk as low as possible before the amount
at stake gets too high. We can see that total project risks decreases as we move toward project
completion, but the amount at stake increases toward the end of the project life cycle.
Keeping that in mind, create risk response plans so that appropriate and timely strategies can be
implemented. For example, if it is known that a key resource may not be available when his work
is needed, actions should be taken to have a backup person, should that situation arise. (Critical
chain method could be applied here.) If you wait until later in the project to find a replacement,
it may be more costly because of time lost due the need to outsource or because of training.
IIL-PEC
5-21
Participants Notes:
Risk is often thought of as something

negative, something that should be avoided.
Depending on whether one is a risk seeker or
opposed to risk, opinions will often lead to
very different results. Within project
management, risk is looked at as both a
potential problem or a potential opportunity.
Regardless, risk always involves something
that will occur in the future.
Risk is inherent in all projects and will only
cause challenges if ignored. Managing risk is
important throughout the project life cycle. It
is an iterative process that is tailored to
specific events in order to protect or enhance
project objectives.
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5-22
Participants Notes:
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5-23
Participants Notes:
Specific uncertainty, or known unknown items are

those items that we can do something about, and
these types of uncertain events are identified and
analyzed, and plans are developed in response to
these types of risks.
Follow this example to explain an unknown
unknown risk:
An outside construction company operating in the
Rocky Mountains, would use historical information
to adjust schedules for inclement weather, but
natural disasters tend to happen with little to no
warning and simply need to be addressed when
they occur.
While some natural disasters can be foreseen, such

as a tornado occurring in Kansas in mid-summer, it
would be unlikely for a tornado to occur during the
Rocky Mountain construction project. It is,
therefore, an unknown unknown risk. In this case,
qualitative and quantitative analysis cannot be
performed because probability distributions are not
available. Consequently, project managers typically
do not deal in areas of this type of uncertainty
(unknown unknowns).
IIL-PEC
5-24
Participants Notes:
The slide shows one example of a risk register

that is used to capture the risk events, as well
as the probability, impact, overall risk ranking,
risk response plans, and the person
responsible.
The next processes analyze risks.
IIL-PEC
5-25
Participants Notes:
Qualitative risk analysis relies on experience is

performed after risk identification is
completed, and the outcome, i.e. the
probability, impact, priority and overall
assessment are recorded in the risk register.
Quantitative risk analysis is performed after
qualitative risk analysis, if needed. Most often,
quantitative analysis is required by high-risk
industries, such as defense, pharmaceutical,
medical, and space. The resulting probability
and financial impact are based on data, and
thus more accurate. This too would be
documented in the risk register, and would
supersede the results of qualitative analysis.
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5-26
The intent of a probability and impact matrix is to ultimately assign a rating of the risk to guide
how aggressively the project team should pursue an appropriate response. For numeric scales,
the risk score is equal to P X I, and these products help rank the risks. Separating these risks
into relative bands using the popular traffic light analogy allows us to group risks into categories
for high, moderate or low, red, yellow or green.
The organizations sensitivity to or tolerance of risk will determine what is considered high (red),
moderate (yellow), or low (green) risk ratings. The higher the risk rating, the more aggressive
the amount of attention, whether it is a threat or an opportunity. For example:
Red risks may be required to be mitigated or avoided
Yellow risks may be mitigated or accepted with explicit contingency plans, should they
occur
Green risks may be accepted, but only require minimal budget and schedule contingencies
These divisions are examples, but in general, a risk neutral orientation will have a balanced
approach to the cells are in each band, as in the table on this slide. A risk-seeking orientation
would have less red and more green, since it would be acceptable to move forward with
more/higher risks outstanding.
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5-27
Participants Notes:
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This process follows risk analysis, and should

decrease threats and increase opportunities
for the project. Risk responses need to be
appropriate based upon the magnitude of risk
and as cost effective as possible. A risk owner
should be identified and agreed to by all
parties. Evaluating a variety of options to
come up with the best response is usually
required.
5-28
Participants Notes:
There are several risk response strategies,

and each is appropriate for a given situation,
as shown. Therefore, when thinking on a risk
response strategy, mitigation is not the only
one to consider when developing a response
plan. However, mitigation, acceptances, and
contingent response will lead you to plan for
contingency reserves. Do you know why these
type of response strategies result in
contingency reserves?
An example to share with the students is the
hot room.
Avoid don't go in the room

Transfer send someone else into the room
Mitigate bring a fan in with you into the
room
Accept assume the risk and go in anyway,
and establish funds to endure the hot room
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5-29
Participants Notes:
IIL-PEC
The iterative nature of the project risk

management is something that often escapes
us in the flurry of other project activities and
issues that demand our attention throughout
the project life cycle.
5-30
Participants Notes:
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5-31
Participants Notes:
We know there are costs associated with each

risk response plan, and these costs become
line items in the project budget. These costs
are associated with known unknown risks,
because the recovery costs are estimated
knowns, but the occurrence of risk event is
unknown, i.e. uncertain. The recovery costs
make up contingency reserves, which is a
portion of the cost baseline, and are
determined by estimating the costs for each
risk response plan.
The contingency reserve amount should be
justified by the level of risk reduction
(mitigation) or elimination (avoidance).
Negotiating and managing reserves will be
addressed in Module 7.
IIL-PEC
5-32
Participants Notes:
How are reserves determined?
Rules of thumb (heuristics)

Risk analysis
Lessons learned
Historical information
Who controls them?
How are they accessed?
Adapted from Project Management, A Systems
Approach to Planning, Scheduling, and

Controlling, 11th Edition, by Harold Kerzner,
Ph.D., p. 751
IIL-PEC
5-33
Participants Notes:
The practice of padding is an unaccepted

practice in project management. Padding is
when indefensible time and cost are added to
project activities. Padding is fueled by the
following perspectives:
If we dont spend the whole budget,
we wont get as much next time
around spend thrift syndrome
Work expands to fill the time
available Parkinson
People wait until the last minute

the student syndrome
We need to put in a little extra just
in case
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5-34
Participants Notes:
IIL-PEC
Now that we know how to establish

contingency reserves, this slide serves as a
reminder that contingency reserves make up a
portion of our cost baseline. However,
management reserves, though part of the
project budget are outside of the project
managers control.
5-35
Participants Notes:
Earned value management (EVM) is a

methodology that combines scope, schedule,
and resource measurements to assess project
performance and progress.

It allows the project team to effectively report
how a project is performing. This performance
is in relation to cost and schedule at a specific
point in time. Additionally, earned value can
predict the potential final results of the
project.
IIL-PEC
5-36
Participants Notes:
Desired results are identified during planning,

and when executing, actual results are
reviewed to determine if there are any
variances from plan. The EVM methodology
recognizes, assesses and manages variance,
via variance analysis.
EVM literally provides an overall project
assessment at a glance. Used correctly, it will
identify if cost and schedule variances have
occurred and signal the project team to
consider possible actions that may be taken to
bring the project back on track with the
original plan.
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5-37
EVM is an advanced methodology for monitoring and controlling the project baseline. It
combines the analyses of schedule and budget, based on a set of indicators that take into
consideration the amount of work that has been done for the actual expenditures. The analyses
dramatically increases the accuracy and usefulness of both schedule and budget performance
reports.
We are introducing the basics concepts here as an example of how the process of estimating
and scheduling pays off during project life. To be used effectively, project management must
commit to:
A significant effort to improve the accuracy of schedule and cost estimates
A considerable investment in actual reporting systems
The following definitions were adapted from PMBOK Guide Fifth Edition, Glossary
respectively:
Actual Cost (AC). The realized cost incurred for the work performed on an activity
duration a specific time period.
Earned Value (EV). The measure of work performed expressed in terms of the budget
authorized for that work.
Planned Value (PV). The authorized budget assigned to scheduled work.
We will assume cumulative values to a specified point in time when exploring EMV basics.
IIL-PEC
5-38
Participants Notes:
IIL-PEC
If you plan to sit for the PMP exam, you will

want to memorize these formulas.
5-39
Participants Notes:
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5-40
Participants Notes:
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5-41
Participants Notes:
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5-42
Participants Notes:
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5-43
Participants Notes:
Planned value (PV), Earned value (EV), and

Actual cost (AC) were defined in the notes
section on 7-23
The following definitions were adapted from
PMBOK Guide Fifth Edition, Glossary are:
IIL-PEC
Cost variance (CV) is the amount of budget

deficit or surplus at a given point in time,
expressed as: CV = EV - AC.
Schedule variance (SV) is a measure of

schedule performance expressed as: SV
= EV - PV
Schedule performance index (SPI) is a

measure of schedule efficiency expressed
as: SPI = EV/PV
Cost performance index (CPI) is a measure

of cost efficiency of budgeted resources
expressed as: CPI = EV/AC
5-44
Participants Notes:
You cannot determine the true status of a project

just by looking at the schedule and cost data.
Spending 30% of the budget does not imply 30%
of the work is completed or vice versa. To
accurately determine status, there must be
thresholds in place that delineate when a project is
on plan and off plan. The project manager must
look at the results of the cost and schedule
analyses, in combination with the thresholds to
accurately report the project status (and forecast).
For example, assume the thresholds for being on
plan are +/-10% for the schedule and budget
baselines. If the schedule variance percentage is
+8% (ahead of schedule), this is favorable, and
the project manager should report as such.
However, if the cost variance is +12% (under
budget), this would be unfavorable, because you
breached the threshold. Therefore, actions should
be taken to understand why the extent of the
budget surplus that may be due to poor planning,
and the analysis should reveal whether the trend
will continue.
IIL-PEC
5-45
Participants Notes:
Remember when taking actions that:
Crashing and fast tracking have associated

risks
Contingency reserves are for implementing
risk response plans
As necessary:
Impact the current baselines when the

variance is outside of the teams control, i.e.
when the customer or outside agencies
request changes in scope, schedule or budget
Challenge the team to take corrective action
without impacting the current baselines, when
variance management is within the teams
control
If all else fails and a request needs to be
submitted by the team to change one or
more baselines to meet the business need, let
this be your last course of action.
Getting the team to work more efficiently is always
desirable. Dont mistake efficiency for over
allocation that may result in burn-out.
IIL-PEC
5-46
Project Management Information System. An information system consisting of the tools and techniques
used to gather, integrate, and disseminate the outputs of project management processes. It is used to
support all aspects of the project from initiating through closing, and can include both manual and
automated systems.

The heart of project control is a deceptively simple four-step process anchored by a Project Management
Information System (PMIS).
Generate preliminary reports from the PMIS that compares actual results against the baseline
Conduct a variance analysis of the preliminary reports to identify variances and actions.
Take corrective and or preventive action based upon the results of the analysis.
Generate reports, per stakeholder information needs and expectations documented in the Project
Communications Management Plan.
Given the project baseline is the foundation of the PMIS, ensure the following are in place to facilitate
project baseline control:
Change control and variance analysis processes
Reporting formats for status, progress and forecast
Timely and accurate actual project data
Project communications management plan
IIL-PEC
5-47
Participants Notes:
If preliminary reports are generated,

reviewed, and then refined before
disseminating the final report, ensure a
process is in place for the preliminary reports
to be reviewed, updated, transmitted back,
and received, in a timely manner.
The project manager benefits from drawing on
information from all stakeholders. Gathering
data through formal as well as informal means
keeps the project manager more connected.
Coaching and mentoring team members on
performance expectations, standards, variance
analysis techniques, and tolerance to variation
increases the supporting casts ability to drive
the results the stakeholders are expecting.
IIL-PEC
5-48
Participants Notes:
The project manager might consider himself a

captain on a ship guiding a vessel through a
predetermined course and maintaining that
course to arrive safely at a planned
destination.
The project baseline is the course that has
been set for the team to follow. Project
baseline control is achieved through formal
reporting on status, progress, forecasts, as
well as, issues and risks.
IIL-PEC
5-49
Participants Notes:
Reporting is a form of communication;

therefore, communications management
planning is critical to project success.
The information and methods of distributing
reports varies widely, as well as methods of
storage, retrieval, and ultimate disposition of
project information. Consequently, when
planning on the content in status, progress,
and forecast reports, consider and answer the
questions posed above.
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5-50
Participants Notes:
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5-51
Participants Notes:
Reports give some indication of the state of

the desired outcome and whether that
outcome is better or worse than expected.
What follows are some considerations for
reporting requirements:
Address needs of recipient stakeholders
(tables, graphs, summaries, etc.)
Deliverable-focused
Status, progress, forecasts at completion
Percent complete and percent spent
Actions associated with recovery plans
for items not on track
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5-52
Participants Notes:
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5-53
Participants Notes:
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5-54
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6-1
Participants Notes:
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Effective Stakeholder Management

content.
6-3
Participants Notes:

At the end of this module or the end of the
course, you should be able to answer quiz or
test questions related to these learning
objectives.
If you are participating in this course for
certification, you will be better prepared to
pass a certification exam by recalling these
learning objectives.
IIL-PEC
6-4
Participants Notes:
A project stakeholder may also exert influence

over the project and its deliverables.
While in some ways stakeholder
management may have been an adequate
choice for labeling the skills targeted in this
course, we deliberately chose stakeholder
relationships skills, because of the significant
impacts of the inevitable emotional side of the
connections among project stakeholders.
Those impacts are what make this segment of
Interpersonal Skills incredibly complex and
subsequently, difficult to master.
Lets consider next the task of identifying
stakeholders in a project situation.
IIL-PEC
6-5
Participants Notes:
Follow the instructors directions and use the

recommended materials to complete the
tasks.
Consider sharing your results as the instructor
asks for volunteers during the debrief.
IIL-PEC
6-6
Participants Notes:
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6-7
Participants Notes:
Apathy or direct opposition to the project

Over involvement/micromanagement
Style conflicts
Personality conflicts
Conflicting priorities
Time/attention limitations
Remote locations
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6-8
Participants Notes:
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Level of competence
Knowledge of organizational culture/

policies
Relationships with other team

members
Similar conflicts as mentioned under

governing bodies
6-9
Participants Notes:
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History of relationship between

client organization and performing
organization (internal, external)
History of relationship between

individuals within the client
organization and between the client
and performing organizations
Similar conflicts as mentioned under

governing bodies, especially
conflicting perceptions of
requirements
6-10
Participants Notes:
The traditional approach follows the PMBOK

Guide philosophy, which is an excellent start,
but basic in its approach. When you are ready
to proactively take on the greater challenges
of stakeholder relationship management, the
relationship-based tool is a must-have!
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6-11
Participants Notes:
This model depicts one of the discrete, 2 or 3

dimensional approaches mentioned in Module
1.
From these models, the project team can
decide which dimensions to use to identify the
potential impact or support each stakeholder
could generate, and classify them so as to
define an approach strategy.
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6-12
Participants Notes:
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Added new in the PMBOK Guide Fifth

Edition, is this type of an analytical technique
for determining where the project teams
might need to direct their efforts in influencing
stakeholders to a more advantageous level of
engagement.
6-13
Participants Notes:
Weve already explored how the categories of

stakeholders across the PLC phases can
change the ways in which we need to manage
relationships.
Here we introduce four additional dimensions
that help us to identify and can give us clues
as to how we need to handle complex
stakeholder relationships.
The first critical dimension we will explore in
this section involves the stakeholders
attitudes toward the project. We define
success differently for each of these attitudes:
Promoter maintain positive support
throughout PLC and leverage that
support, as needed
Bystander move to promoter, if
possible, or at minimum, maintain
neutral position
Adversary move to bystander or
neutralize influence
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6-14
Participants Notes:
You can use the relationship-based

stakeholder relationship tool provided as part
of this courseware to calculate a numerical
rating for specific stakeholder relationships.
(see next page in workbook for format)
Some tips for what to do once you have
completed your assessment:
Make sure you have a proactive
communication/action plan for each hot
spot (>= threshold #1, which you can
set based upon the relative ratings from
your assessment results)
Have a maintenance and contingency
plan for simmering points (>=
threshold #2)
Monitor cool spots to make sure they
dont heat up! (< threshold #2)
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6-15
Participants Notes:
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These relationships and skills intertwine and

overlap in the context of the PLC phases, as we
saw earlier in this module. We will close this
module with a brief description of each of these
skill families, then proceed to explore each family in
more detail in subsequent modules. In other words,
the skills we grouped under the Advocacy family,
are most necessary in dealing with Governing
Bodies, especially in the early stages or Concept
Phase of the PLC. However, many of the skills we
describe in the Advocacy family can also be useful
in other combinations of stakeholder categories and
PLC phases, depending upon whats happening
with the other complexity dimensions and
circumstances, e.g., attitudes, power and
influence, relative geo-location, and the existence
of open conflicts. To provide practice in what we
consider the most applicable situations, we have
identified the characteristics of some of the most
common hot spots to showcase in our case
studies, the introductory scenario of which you will
see at the end of this section, to wrap up the
module.
6-16
Participants Notes:
The major theme of the Advocacy family is

to leverage the efforts of individual
stakeholders in the pursuit of project
objectives. This aspect of stakeholder
relationships is especially important for the
category of Governing Bodies.
The major theme of the Leadership family is
to leverage the efforts of key groups of
stakeholders to work together synergistically
in the pursuit of project objectives. This
aspect of stakeholder relationships is
especially important for the category of
Project Team.
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6-17
Participants Notes:
The major theme of the Rapport family is to

build and maintain good relationships that are
critical to the pursuit of project objectives.
This aspect of stakeholder relationships is
especially important for the category of
Clients.
The major theme of the Harmony family is to
meet the needs and mitigate the constraints
of specific stakeholders inevitably involved in
the pursuit of project objectives. This aspect
of stakeholder relationships is especially
important for the category of Auxiliary Bodies.
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6-18
Participants Notes:
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6-19
Participants Notes:
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6-20
Participants Notes:
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6-21
Participants Notes:
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6-22
Participants Notes:
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6-23
Participants Notes:
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6-24
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7-1
Participants Notes:
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Project Leadership Skills

content.
7-3
Participants Notes:

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7-4
Participants Notes:
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7-5
Participants Notes:
Adapted from What Leaders Really Do,

Harvard Business Review Reprint 90309 (see
model on next slide)
The primary functions of leadership:
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Setting Direction
An inductive approach where direction is
set through gathering a broad range of
data, looking for/analyzing patterns,
shepherding relationships, and acting on
key linkages and interrelationships.
Aligning People
Effectively communicating with many
individuals who either can help
implement the
vision/strategies/objectives of the
project or who can block
implementation of same. Getting them
to understand and believe in the
message and value of the project.
Motivating People
Mobilize people to highly energized
behavior to ensure that they will have
the energy to overcome obstacles.
7-6
Participants Notes:
For project managers, both are important. In this

course, dedicated to mastering stakeholder
relationships, we are focusing on the leadership
side of the equation. In particular, we find that the
middle function, Aligning People, is probably the
most critical element in dealings with the Project
Team. In particular, two of the three skills we
initially defined in Module 2 as the primary skills in
the Leadership family of relationship skills are key
enablers of this function. Here is how we see those
skills lining up with these functions:
Influencing (aligning people)
Facilitating (aligning people)
Coaching/mentoring (motivating and inspiring)
We will also be identifying secondary leadership
skills in this family of relationship skills. Here is a
preview of how we see them with respect to this
model:
Communicating (aligning people)
Visioning (setting direction)
Motivating (motivating and inspiring)
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7-7
Participants Notes:
Lets revisit this model, looking now at the

Leadership View.
Remember that the best way to think of this model
is from the core out. Lets keep the four families of
relationship skills anchored while we look out
through the PLC layer, which can be spun to align
with the current PLC phase. In turn, the outer
circle can also be spun so that each family of
skills in some way supports every combination of
Stakeholder category/PLC phase. However, if we
tried to cover all that territory, we would need a
two-week workshop. So, in our model, we have
positioned each family of relationship skills opposite
the major categories for which that family provides
the most effective solutions.
In some cases, there is also a primary PLC phase,
e.g., we see the Leadership family of skills as
having the most impact with the Project Team,
especially in the detailed planning stage or Design
Phase. That does not mean that the skills that we
describe as being in the Leadership family will not
be needed for other combinations of stakeholder
category/PLC phase, but that the particular
combination we have identified will be used to
demonstrate the skill, in what we think is the most
effective scenario for practice and successful
knowledge transfer.
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7-8
Participants Notes:
Recall that in Module 2, when we introduced

this family of skills, we said that the major
theme of the Leadership family is to leverage
the efforts of key groups of stakeholders to
work together synergistically in the pursuit of
project objectives. This aspect of stakeholder
relationships is especially important for the
category of Project Team.
We will address each of these primary skills in
more detail in this module. But first, lets take
a brief look at what secondary skills round the
full spectrum of this particular family.
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7-9
Communicating is a very broad skill set all of which impacts stakeholder relationships. So you
will see that there is either a primary or secondary skill in each of the relationship skill families we
have defined. IIL also has a complete course on the different aspects of Communications skills
that are most pertinent to Project Managers.
What we call Visioning is partly the skill of Setting Direction in the HBR model we presented
earlier in this section, which they define as an inductive approach where direction is set through
gathering a broad range of data, looking for/analyzing patterns, shepherding relationships, and
acting on key linkages and interrelationships. But visioning goes beyond just Setting Direction by
tapping into an intuitive sense that goes beyond the data and into creative possibilities. This skill
may be secondary at the project manager level, but it becomes primary at the next level up, and
may not be something that is totally teachable.
Motivating is also a skill defined in the previous HBR model, defined as mobilize people to highly
energized behavior to ensure that they will have the energy to overcome obstacles. Many ILL
courses (e.g., PMP Cert, Introduction to IPS, and Building High-Performing Teams) delve into this
skill based in theories including the classics from Maslow, Herberg, and Jung.
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7-10
Participants Notes:
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7-11
Participants Notes:
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Influencing is a subtle and indirect skill which more

than any other skill involves the whole project
manager. Not only is the experience, expertise, and
knowledge of the project manager brought to bear
but also their character, ethics, personality, style,
and body language. These all are consciously
mingled together for the purpose of leading and
maneuvering the project team to a successful
project outcome, something like the suns pull on
the planets.
Dictionary Definition To exert or have an

effect on the nature, behavior, development,
action or thought of a person or thing. This
implies the power of persons or things
(whether exerted consciously or overtly) to
affect others acceptance, belief, obedience
etc. based on strength of character,
expertness of knowledge, etc.
Project Definition Blending various skills and

character qualities for the purpose of
maximizing the capability and effectiveness of
the project team; maneuvering team
performance to achieve a successful outcome
of the project.
7-12
Participants Notes:
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7-13
Participants Notes:
The common theme here is to gravitate

toward the projects successful outcome.
At the PM Team level, its more about
applying PM best practices to achieve project
objectives.
For Technical Leads and Specialists, it
involves integrating their respective types of
expertise with the PM best practices to
achieve project objectives.
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7-14
Participants Notes:
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7-15
Participants Notes:
Good facilitation skills make a real difference

in making good people great, great people
into superior teams, and enable smart people
to make the best decisions.
Dictionary Definition To make easy or
easier.
Project Definition The process of
achieving a desired outcome among two
or more project stakeholders; in this case
the project team, that express differing
perspectives, opinions, concerns ,desires
and possess different skills, experience,
and knowledge to achieve project
success.
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7-16
Participants Notes:
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7-17
Participants Notes:
Smart people do not necessarily result in the

outcome of smart decisions or solutions. The
project manager will be in meetings comprised of
people from different departments and disciplines
who will have conflicting view points. The project
manager will encounter hidden agendas, people
that will pull rank, conflicting personalities, launch
of personal attacks or us and them" tactics and
several people that will tend to dominate the
discussion. These together can easily overwhelm
the ability for getting anything useful accomplished
in a meeting of any kind. Project managers void of
good management skills, right tools, effective
techniques to bring achieve good closure will defeat
good project performance.
Critical success factors include:
Helping people to deal with new or difficult
issues, and persevere as they confront the
inevitable confusion and frustration associated
with trying to integrate different views and
approaches with their own
Maintaining a neutral position always seeking
to reach win-win outcomes whenever possible
Owning the responsibility and having genuine
desire to help people do their best thinking
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7-18
Participants Notes:
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7-19
Participants Notes:
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Every team member will possess various levels

of expertise, degrees of experience, and
command of project management practices
and principles. The project manager will use
these two skills to enable the required level of
team performance.
Dictionary Definition
Coaching means to instruct in a subject
or prepare for an examination by private
tutoring (tutor, instructor)
Mentoring means act as a mentor (to):
advise (advisor or counselor)
Project Definition
Coaching means being a teacher which
involves direct hands-on instruction in
some area of project expertise.
Mentoring means being more of an
adviser or guide. The approach is
typically indirect or delivered around
more broad or intangible topics and
situations, e.g., culture, politics, project
principles.
7-20
Participants Notes:
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Here is a perspective from executive-level

mentoring and coaching that can be
extrapolated to our project stakeholder level
needs.
7-21
Participants Notes:
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The common theme here is that everyone can

benefit from the knowledge and use of some
kind of PM tools and techniques. Finding the
right ones for the right stakeholders, inspiring
their interest and successfully seeing them
through to the state where they can apply
them, elevates the project manager from
management to leadership status through
coaching/mentoring.
7-22
Participants Notes:
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7-23
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8-1
Participants Notes:
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Project Rapport and Harmonizing Skills

content.
8-3
Participants Notes:

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8-4
Participants Notes:
Follow the instructors directions to complete

the activity on your own.
Be prepared to share your results with the
rest of the class during the debrief.
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8-5
Lets revisit this model, looking now at the Rapport View.

Remember that the best way to think of this model is from the core out. Lets keep the four
families of relationship skills anchored while we look out through the PLC layer, which can be
spun to align with the current PLC phase. In turn, the outer circle can also be spun so that
each family of skills in some way supports every combination of Stakeholder category / PLC
phase. However, if we tried to cover all that territory, we would need a two-week workshop. So,
in our model, we have positioned each family of relationship skills opposite the major categories
for which that family provides the most effective solutions.
In some cases, we were able to identify a single PLC phase that stands out amongst the others
as most critical for the primary stakeholder category associated with the target family of skills.
However, for Rapport skills, that one-to-one relationship just does not work. We see the Rapport
family of skills as having the most impact with the Client, but we could not identify just one PLC
phase for emphasis. The truth is that the PM (and in fact the whole performing organization)
must keep the pedal to the metal from start to end in creating, maintaining, and transitioning
the client relationship with rapport skills. Again, that does not mean that the skills we describe
as being in the Rapport family will not be needed for other combinations of stakeholder category
/ PLC phase, but that, in this case, the particular combinations (Client/all PLC phases) that we
have identified will be used to demonstrate the skills, in what we think are the most effective
scenarios for practice and successful knowledge transfer.
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8-6
Participants Notes:
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Recall that in Module 2, when we introduced

this family of skills, we said that the major
theme of the Rapport family is to build and
maintain good relationships that are critical to
the pursuit of project objectives. This aspect
of stakeholder relationships is especially
important for the category of Clients.
8-7
Participants Notes:
Extracting is analogous to what an eye

doctor does to zero in on the right prescription
for glasses or contact lenses. Which is
better, A or B? Then later, Which is better,
B or A? IIL covers these skills in its course on
Requirements Definition.
Negotiating was covered as a primary
Advocacy skill. In that case it was associated
primarily with resources, where as with
clients, the primary negotiations focus on
requirements, ), as in limiting scope creep and
still maintaining customer satisfaction).
Networking is sometimes known as
schmoozing, but is also much more than
that, as you will see when we will cover it in
the next module as a primary Harmony skill.
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8-8
Participants Notes:
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8-9
Participants Notes:
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Communicating for rapport is a very special subset of

general communication skills. The emphasis is on the
feedback loop (see diagram on next slide) listening,
detecting personal leanings, and understanding the
clients issues. It requires good instincts for asking the
right questions and then following through at the right
time with appropriate and genuine responses to instill
trust and build a personal connection.
Dictionary Definition To give or exchange

information, signals, or messages in any
way, as by talk, gestures, or writing. To
have a sympathetic or meaningful
relationship.
Project Definition (in the context of rapport

with clients) Ensure that the client gets the
right information at the right time and place
through the most appropriate means with
content at a level of clarity and integrity that
eliminates ambiguity and builds trust.
8-10
Participants Notes:
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8-11
Participants Notes:
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8-12
Participants Notes:
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8-13
Participants Notes:
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8-14
Participants Notes:
The common theme here is to gain trust and

support.
At the working level, it also involves the
uncovering of the true underlying issues that if
solved, would make this project successful for
this group of clients.
At the influencer level, it also involves
uncovering all of the competing decision
criteria and a sense for their relative
importance across the whole group.
At the decision-maker level, its all about

closing the sale, regardless of whether its
an external or internal client like it or not it
is most definitely a sales situation. You may
have to adapt your style, but not your
integrity.
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8-15
Participants Notes:
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8-16
Participants Notes:
Please make notes regarding your individual

thoughts in the space provided.
Consider sharing your thoughts as the
instructor asks for volunteers.
The instructor should record your
contributions, on either a flip chart in the
classroom or a whiteboard on Centra.
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8-17
Lets revisit this model, looking now at the Harmony view.

Remember that the best way to think of this model is from the core out. Lets keep the four
families of relationship skills anchored while we look out through the PLC layer, which can be
spun to align with the current PLC phase. In turn, the outer circle can also be spun so that
each family of skills in some way supports every combination of Stakeholder category/PLC phase.
However, if we tried to cover all that territory, we would need a two-week workshop. So, in our
model, we have positioned each family of relationship skills opposite the major categories for
which that family provides the most effective solutions.
In some cases, we were able to identify a single PLC phase that stands out amongst the others as
most critical for the primary stakeholder category associated with the target family of skills.
Again, we see one particular stakeholder category as the prime target for Harmony skills
Auxiliary Bodies. However, as with Rapport, we are going to take more of an end-to-end view and
not focus on just one PLC phase. Another departure for the Harmony family of skills from all three
other families is that, using Harmony skills with respect to the Auxiliary Bodies, is not a primary
objective for most projects. Therefore, we will treat this topic as a stretch goal in this course as
something we will explore to the extent that time and participants interests dictate, but we will
not technically practice these skills.
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8-18
Participants Notes:
Recall that in Module 2, when we introduced this

family of skills, we said that the major theme of the
Harmony family is to meet the needs and mitigate
the constraints of specific stakeholders inevitably
involved in the pursuit of project objectives. This
aspect of stakeholder relationships is especially
important for the category of Auxiliary Bodies.
Networking usually comes into play first, as we
recognize a special need and want to explore the
ramifications, usually in the Concept phase of the
PLC. Then, if the need is urgent or has important
long-term implications for the projects objectives,
we would seek to apply creative problem-solving
techniques, most likely in the Design phase. During
Implementation and Closure, we may need to rely
on some balancing techniques to maintain our
equilibrium.
We will address each of these primary skills in more
detail in this module. But first, lets take a brief look
at what secondary skills round the full spectrum of
this particular family.
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8-19
Communicating is a very broad skill set all of which impacts stakeholder relationships. So you
will see that there is either a primary or secondary skill in each of the relationship skill families we
have defined. IIL also has a complete course on the different aspects of Communications skills
that are most pertinent to Project Managers.
Navigating government agencies is a very specialized skill associated with those projects that
need to deliver products and services to national, departmental, and local governments across
the globe. Each level lends its own unique challenges above and beyond the normal project
opportunities to excel. In the US, the infamous tomes of the Federal Acquisition Regulations
(FAR) lay down the formal processes. However, it is the nuances and informal processes between
the formal procedural lines that may take years to assimilate.
Listening with empathy or empathic listening, is a very specialized communication skill, first
coined by Stephen Covey in his 7 Habits of Highly Effective People in 1987. IIL addresses this
particular skill in more detail in our Conflict Resolution for PMs course.
Respecting diversity requires first the knowledge and/or the willingness to learn about cultures
other than your native heritage. The second part of this skill involves the willingness and ability to
assimilate the customs, styles, and preferences that are different from your own into a project
culture that works for all stakeholders. Most larger organizations have in-house opportunities to
help you achieve their specific diversity objectives.
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8-20
Participants Notes:
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8-21
Participants Notes:
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Networking is similar to communicating for rapport

(Module 5 Rapport family of skills), but does not
go as deep.
Dictionary Definition Developing contacts or
exchanging of information with others in an
informal or formal network to further
relationships and advance objectives.
Project Definition Identify external
stakeholders, evaluate their motives, assess
their level of influence, and implement
appropriate courses of action to establish and
cultivate healthy relationships that enable
mitigation of negative impacts and leveraging
of positive impacts.
Networking within this skill family is focused on
external stakeholders who are affected by the
project or have an interest but are not part of the
main project team. Members of this external
group are free to behave in any way they see fit
with no regard for the project. Their behavior will
typically fall into one or more of the three
categories:
Show no interest in the project
Decide to work against the project
Decide to support the project
8-22
Participants Notes:
Creative problem solving is our best response to

the accelerating pace of change on a global scale.
This pace has created enormous strain and
pressure on traditional organizational forms and
methods proven successful in the past but that no
longer work. Solutions emerging to counter these
issues require project management or innovative
temporary management structures which are highly
organic able to respond quickly and easily
accommodate internal/external situations
associated with a project.
Dictionary Definition A model for solving

problems through a step-by-step process
which includes fact finding, problem finding,
idea finding, solution finding, and
implementation. Brainstorming, lateral
thinking and other strategies for the
production of creative ideas are an integral
part of the process. (This definition comes
Project Definition Fluid ability to quickly

select and rapidly apply different techniques
individually or in the most appropriate mix to
effectively overcome or counter problems and
conflicts on projects.
from a Google search on the Internet).
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8-23
Participants Notes:
Balancing is like the tension that must be

established and managed like two wings of a
bird in flight. The right balance of drag and lift
that lift the wings requires constant large and
small adjustments. Balancing skills are
becoming more important for a project
manager to finesse project execution through
complex external forces and agendas.
Dictionary Definition To bring into or
keep in a state of equilibrium or
equipoise; keep steady; poise. To bring
into proportion, harmony etc.
Project Definition Establish and sustain
the appropriate equilibrium between
discipline and flexibility opposite the
project objectives and issues that are
externally impacting successful
completion of the project.
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8-24
Participants Notes:
The common theme here is to reduce risks from

ignoring external forces that seem benign, but may
have significant negative impacts to avoid or
positive opportunities to leverage, if we just think
to look there.
For regulatory agencies, if applicable, it is well
worth your while to cultivate a single contact or join
an appropriate professional organization, e.g., PMI
has several Specific Interest Groups (SIGs) in areas
that are prone to regulatory burdens, including
Aerospace and Defense, Healthcare, and Oil, Gas
and Petroleum. (see www.pmi.org)
For society-at-large, consider environment
groups, parent-teacher groups, and community
service organizations as sources for identifying
allies and/or maintaining your global citizenry
duties.
For families, primarily of project team members,
but also other impacted stakeholders, like those
who might lose their jobs because of an initiative
you are implementing, at least be aware of the
primary ties. Use your human resources
department or search for ad hoc resources on the
Worldwide Web that can support specific needs.
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8-25
Participants Notes:
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Lets wrap up this workshop, with a personal

action plan designed to help you integrate at
least one of the primary Harmony skills into
your personal repertoire for dealing with
auxiliary bodies or other stakeholders on your
real-world projects.
8-26
Participants Notes:
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8-27
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SUMM-1
Participants Notes:
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Summary and Next Steps

content.
SUMM-3
Participants Notes:

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SUMM-4
Participants Notes:
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SUMM-5
Participants Notes:
The 42 project management processes are

grouped into five categories known as the
Project Management Process Groups.
Not all of the real world interactions among
the Process Groups and Knowledge Area
processes can be documented, however, we
will look at a summary of the discrete
processes and how they generally work
together in delivering projects.
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SUMM-6
Participants Notes:
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SUMM-7
Participants Notes:
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This diagram displays the process of

elaborating project scope. There are key
deliverables that are created as part of the
scope definition process.
SUMM-8
Project Management Information System. An information system consisting of the tools and techniques
used to gather, integrate, and disseminate the outputs of project management processes. It is used to
support all aspects of the project from initiating through closing, and can include both manual and
automated systems.

The heart of project control is a deceptively simple four-step process anchored by a Project Management
Information System (PMIS).
Generate preliminary reports from the PMIS that compares actual results against the baseline
Conduct a variance analysis of the preliminary reports to identify variances and actions.
Take corrective and or preventive action based upon the results of the analysis.
Generate reports, per stakeholder information needs and expectations documented in the Project
Communications Management Plan.
Given the project baseline is the foundation of the PMIS, ensure the following are in place to facilitate
project baseline control:
Change control and variance analysis processes
Reporting formats for status, progress and forecast
Timely and accurate actual project data
Project communications management plan
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SUMM-9
Participants Notes:
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These relationships and skills intertwine and

overlap in the context of the PLC phases, as we
saw earlier in this module. We will close this
module with a brief description of each of these
skill families, then proceed to explore each family in
more detail in subsequent modules. In other words,
the skills we grouped under the Advocacy family,
are most necessary in dealing with Governing
Bodies, especially in the early stages or Concept
Phase of the PLC. However, many of the skills we
describe in the Advocacy family can also be useful
in other combinations of stakeholder categories and
PLC phases, depending upon whats happening
with the other complexity dimensions and
circumstances, e.g., attitudes, power and
influence, relative geo-location, and the existence
of open conflicts. To provide practice in what we
consider the most applicable situations, we have
identified the characteristics of some of the most
common hot spots to showcase in our case
studies, the introductory scenario of which you will
see at the end of this section, to wrap up the
module.
SUMM-10
Participants Notes:
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Please provide feedback to the instructor.
SUMM-11
Participants Notes:
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SUMM-12
Participants Notes:
We really appreciate your attendance and

participation in this course.
If you found this to be a valuable experience,
please recommend the course to your friends
and coworkers!
The instructor will now solicit your feedback
by handing out a course evaluation sheet.
Please complete the evaluation and place it on
the instructors table as you leave the
classroom.
If you are taking this class in IILs virtual
eLearning environment, complete the
evaluation form online.
IIL-PEC
SUMM-13

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IIL-PEC

2014 International Institute for Learning, Inc.

Project Execution and Control

2014 International Institute for Learning, Inc.

Project Execution and Control

2014 International Institute for Learning, Inc.

Project Execution and Control

You will be given information pertaining

2014 International Institute for Learning, Inc.

Project Execution and Control

Each module builds upon the knowledge,

2014 International Institute for Learning, Inc.

Project Execution and Control

Please review the course goal within the

2014 International Institute for Learning, Inc.

Project Execution and Control

Please review the objectives. By doing so, you

2014 International Institute for Learning, Inc.

Project Execution and Control

We may have a wide variety of starting

2014 International Institute for Learning, Inc.

Project Execution and Control

You can expect each module to flow as

A learning journal is provided at the end

2014 International Institute for Learning, Inc.

Project Execution and Control

This discussion will be used as a background

2014 International Institute for Learning, Inc.

2014 International Institute for Learning, Inc.

Project Execution and Control

Each module builds upon the knowledge,

2014 International Institute for Learning, Inc.

Project Execution and Control

2014 International Institute for Learning, Inc.

Project Execution and Control

*Materials in this class are substantially

2014 International Institute for Learning, Inc.

Project Execution and Control

Some examples of single-release products are:

2014 International Institute for Learning, Inc.

Project Execution and Control

The 42 project management processes are

2014 International Institute for Learning, Inc.

Project Execution and Control

The Project Management Standards

2014 International Institute for Learning, Inc.

Project Execution and Control

This exercise will be conducted either as a full

2014 International Institute for Learning, Inc.

Project Execution and Control

Use the chart to rank project management

2014 International Institute for Learning, Inc.

Project Execution and Control

2014 International Institute for Learning, Inc.

Project Execution and Control

2014 International Institute for Learning, Inc.

Project Execution and Control

This event will be conducted as an open

2014 International Institute for Learning, Inc.

Project Execution and Control

Moving learners from reactive to proactive

2014 International Institute for Learning, Inc.

Project Execution and Control

2014 International Institute for Learning, Inc.