RITx: PM9001x Project Management Life Cycle

Accept risk: Risk response strategy where we choose to take no preventative action if a risk occurs (no proactive response plan). We monitor the risk to see if actions need to be taken at a future time.

Acceptance criteria: Measurable "performance requirements and essential conditions which must be met before project deliverables are accepted." (definition from PMI)

Activities: The actual tasks or elements of work that must be done to produce the Work Package deliverable. Are sequenced.

Actual Cost (AC): Part of Earned Value Analysis. Based on your current progress to date, what did you actually spend by this time.

Analogous estimating: A "technique for estimating the duration or cost of an activity or a project using historical data from a similar activity or project" (definition from PMI). Requires obtaining historical data of similar projects.

Assumptions: Criteria or characteristics that are expected to be true about the project or its deliverables.

Avoid risk: Risk response strategy where we take preventative action to completely avoid the chance that the risk can occur.

Backward Pass: The process of moving from the finish of the network diagram, backwards through all the network paths towards the start of the diagram, to determine the latest start date and latest finish date for each activity and to determine float/slack.

Baseline: The Project Plan approved by key project stakeholders. Used during Execution to compare to actual project performance to determine if the project is on track (within approved variance limits). Can only be changed by an approved Change Order.

Bottom-up estimating: Estimates costs at the lowest level activities of the WBS, then costs are aggregated upwards to produce a total.

Budget at Completion (BAC): Part of Earned Value Analysis. Based on your original baselined plan, what you planned to spend to complete the entire project.

Business case: See "Purpose".

Change Control Board (CCB): A team of stakeholders that review and make decisions regarding changes that will or will not be made to the project.

Change control process: A process to manage changes to the baseline plan for scope, cost, or schedule. Change Orders are reviewed and either rejected or accepted (acceptance requires the Project Plan be changed and re-baselined)

Change Order/Change Request: "A formal proposal to modify any document, deliverable, or baseline." (definition from PMI) The proposal describes the change and impact, and must be reviewed and approved by a Change Control Board (CCB) before the change is enacted.

Closure (Phase): Last phase of the Project Life Cycle. Final deliverables and documentation are turned over the customer. A post project review is completed with best practices and lessons learned captured. The team celebrates/is recognized. Resources are reassigned to other projects.

Closure Plan: Documents the plan to Close the project. The plan is created in the Planning Phase so scope, schedule, budget, and resource needs can be documented.

Co-located team: Team members are in the same physical location. There is more opportunity for face-to-face communication.

Communication Plan: Documents the information that needs to be shared about the project, how often it will be shared, who it is shared with, the method used to share, and who's responsible for preparing and sharing that communication.

Constraints: Limits or restrictions that are known and must be accommodated during the project.

Contingency Budget/Funds: Additional money added to the budget to cover the cost of incurring potential risks that have been identified. Based on quantitative analysis of the risks and the risk tolerance of the organization.

Cost (Budget): The necessary expenses for the project, including human and physical resources. Often includes contingency funds.

Cost Performance Index (CPI): A ratio of the Earned Value to the Actual Cost that tells us how efficient we are at managing our budget. CPI = EV/AC

Cost variance (CV): "The amount of budget deficit or surplus at a given point in time, expressed as the difference between the Earned Value and the Actual Cost" (definition from PMI). CV = EV - AC

Crashing: Schedule compression technique that adds resources or increases resource availability to critical activities to meet an accelerated schedule date.

Critical activities: All of the activities on the critical path. Cannot be started any earlier (ES=LS). Cannot be delayed without impacting the finish date of the project (EF=LF).

Critical path: The longest path through the network diagram in duration. Determines the critical activities.

Critical Path Method (CPM): "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" (definition from PMI).

Deliverable: The products or services to be created. Includes both the planning deliverables and the outputs of the project itself.

Duration: The "total number of work periods (not including holidays or other nonworking periods) required to complete a schedule activity or work breakdown structure component. Usually expressed as workdays." (definition from PMI). The number of workdays it will take to complete an activity. Is used to create the project schedule network diagram.

Early Finish (EF): The earliest date an activity can finish. Determined by its Early Start plus its duration.

Early Start (ES): The earliest date an activity can start given that it must wait on any predecessor relationships to complete. Determined from the Early Finish of the latest/largest predecessor activity if there is more than one predecessor.

Earned Value (EV): "The measure of work performed expressed in terms of the budget authorized for that work." (definition from PMI). Part of Earned Value Analysis. Based on your original baselined cost and schedule AND the activities you have actually completed to date, what you should have spent to complete those activities.

Earned Value Analysis (EVA): A technique used to measure project cost and schedule performance based on what was planned, what has been accomplished and what has been spent. Can also be used to forecast the estimate to complete and estimate at completion for a project.

Effort: "The number of labor units required to complete a schedule activity or work breakdown structure component, often expressed in hours" (definition from PMI). The number of hours of work it will take the resources to complete an activity. Is used to build the work effort portion of the budget.

Estimate at Completion (EAC): The total amount of money we will spend to complete the entire project based on our performance to date. EAC = AC + ETC

Estimate to Complete (ETC): The money required to complete the remaining work on our project. ETC = (BAC - EV) ÷ CPI

Exclusions: Features, functions, services, or deliverables that are not included in the scope of work or project objectives or deemed to be covered by resources outside of the project.

Execution (Phase): Third phase of the Project Life Cycle. Work is performed to complete the project deliverable. The project is monitored and controlled (adjusted) to ensure that the actual work being delivered meets the scope, cost, and schedule documented in the Project Plan. Regular team meetings happen and status updates are shared with stakeholders.

Expected Monetary Value (EMV): Takes the probability of occurrence of a risk (as a percentage) multiplied by the monetary value of the impact (cost impact if the risk happens), to get a value that is added to contingency funds.

Fast Tracking: A schedule compression technique that reduces the duration of a critical path by partially or fully overlapping the activities (changing the sequence to make the activities run in parallel or overlap rather than in sequence).

Float/Slack: "The amount of time that a schedule activity can be delayed or extended from its early start date without delaying the project finish date" (definition from PMI). Difference between the latest start and earliest start. Only non-critical activities can have float/slack.

Forward Pass: The process of moving from the start of the network diagram, forwards through all the network paths to the end of the diagram, to determine the earliest start date and earliest finish date for each activity (and the earliest the project can finish).

Functional Manager: A person who manages an organizational unit/department such as marketing, accounting, manufacturing, etc.

Functional organization: A project structure where the functional manager has authority over the people in the organization. Project managers "borrow" resources from functional managers to work on project activities. Resources share their time between project work and operations work (work part time on the project). Also known as a traditional, hierarchical, or vertical organization.

Group decision making (estimating): One technique is the Delphi Method, an iterative process where experts provide individual cost estimates, review each other estimates, then narrow down variation to determine a consensus estimate.

Initiation (Phase): First phase of the Project Life Cycle. Defines the purpose, goals, and objectives to be achieved in the project. Stakeholders are identified and a Project Manager is selected. A Project Charter is created.

Late Finish (LF): The latest date an activity can finish without delaying the entire project. Determined from the Late Start of the earliest/smallest successor activity if the activity has more than one successor.

Late Start (LS): The latest date an activity can start without delaying the entire project. Determined by its Late Finish minus its duration.

Matrix organization: A project structure that combines elements from both a Functional organization and a Pure Project organization. Some resources work full time on the project and others work part time on the project. The functional manager and the project manager have authority over different elements. Can be strong (more like a Pure Project), weak (more like a Functional), or balanced (in the middle).

Metrics: A set of measures used to monitor and control the performance of the project (efficiency) and the deliverables of the project (effectiveness).

Milestone: Significant points or events in the project schedule with duration and effort of zero, no cost, and no resources assigned. Markers for when things need to be completed by (examples: deliverables due, majors tasks completed).

Mitigate risk: Risk response strategy where we take preventative action to reduce the impact and/or probability of the risk occurring. Most common strategy.

Monitoring and Control: Part of the Execution Phase. Measures are collected to monitor the performance of the project. Analysis is conducted on the measures to determine what control actions or changes are necessary to deliver to the baselined plan. The process repeats through project Execution.

MoSCoW: A requirements prioritization method that stands for "Must have, Should have, Could have, Won't have".

Net Present Value (NPV): A financial measure for selecting projects. Looks at the return on investment over time, factoring in a required rate of return, and accounting for money decreasing in value over time (time value of money). An NPV of 0 means the project will return the money required. An NPV above 0 means a higher rate of return (the larger the number, the greater the benefit). A negative NPV means the organization will never achieve the return needed.

Network Diagram: "A graphical representation of the logical relationships among the project schedule activities" (definition from PMI). A visual depiction of the flow of work (activities) in order to complete the project.

Network path: A unique sequence of activities in a network diagram that flow from start to finish. There are multiple network paths, at least one of which is the critical path.

Objectives: The goals/results/benefits expected to be achieved for the project. Should be SMART (specific, measurable, achievable, relevant, and time-bound).

Parametric estimating: "An estimating technique in which an algorithm is used to calculate cost or duration based on historical data and project parameters" (definition from PMI). Requires a database of known cost per unit based on historical data.

Payback Period: A financial measure for selecting projects. Calculates how long it will take to return the initial investment of the project. A shorter payback period means the organization achieves financial benefits sooner.

Phase gate review: "A review at the end of a phase in which a decision is made to continue to the next phase, to continue with modification, or to end a project" (definition from PMI). Often done at key milestones.

Planned Value (PV): Part of Earned Value Analysis. Based on your original baselined plan, what you planned to spend by this time in the schedule.

Planning (Phase): Second phase of the Project Life Cycle. Identifies all details of the project and how it will be carried out to meet the objectives (scope, resources/team, budget, schedule, risks, procurement, stakeholder management, communication, quality). The full Project Plan is created (multiple documents) and baselined.

Post Project Report: Documents lessons learned, best practices, recommendations for improvement as discussed in the post project review meeting.

Post project review meeting: A reflection meeting with the project team and stakeholders during Project Closure to discuss lessons learned and best practices. Results in a Post Project Report.

Predecessor activity: "An activity that logically comes before a dependent activity in a schedule" (definition from PMI). One activity must finish before the next can start (Finish-to-Start relationship).

Probability and Impact Matrix: A qualitative risk analysis strategy that uses a "heat map" matrix of probability versus impact to assist with the prioritization of risks.

Process: An operation performed repeatedly to sustain the business (no defined start or end).

Procurement Plan: Documents the process that will be used to engage suppliers, contract with suppliers, and manage the supplier relationship.

Profitability Index: A financial measure for selecting projects. Similar to NPV, but expressed as a ratio. If the ratio is greater than 1, there will be financial benefits (the larger the number, the greater the benefit). If it is less than 1 (correlates to an NPV of 0 or less), then there is no financial benefit.

Project: A "temporary endeavor undertaken to create a unique product, service, or result." (definition from PMI)

Project Charter: "A document issued by the project initiator or sponsor that formally authorizes the existence of a project and provides the Project Manager with the authority to apply organizational resources to project activities" (definition from PMI). Indicates the purpose of the project, the objectives, high-level requirements, major milestones, an overview of the resources required, major risks, and key Stakeholders.

Project kickoff: A meeting of the project team. They get to know each other, review the Project Charter, and understand why the project has been initiated and what it is intended to deliver. Also called a project startup meeting.

Project Life Cycle: The phases a project goes through: Initiation, Planning, Execution (monitoring and control), and Closure.

Project Management: The methods and tools used to deliver a project that meets its stated objectives.

Project Management Office (PMO): Provide support to the projects and Project Managers within an organization. Common functions include sharing best practices, coaching and education, development of standards and methodologies, and assisting with project selection. Must align to business plan and demonstrate value.

Project Manager: A person who manages a project by managing the Triple Constraint, leading a team, engaging stakeholders, managing risk and resolving issues, negotiating, communicating, and more.

Project Plan: A multi-part document that includes the Scope of Work (Requirements Document, Scope Statement, Work Breakdown Structure and Activities List), Schedule, Budget, Risk Plan, Quality Plan, Communication Plan, Team Plan, Procurement Plan, and Stakeholder Plan.

Project Portfolio: The set of projects that a company considers key to its success and tied to the business plan/strategy.

Project Scope Statement: A document that indicates the elaborated scope description, acceptance criteria, deliverables, exclusions, constraints, and assumptions.

Project selection process: Use of financial and non-financial criteria to determine which projects move forward to Initiation. Selected projects should be those best aligned to the strategic goals of the organization and offer the most benefits to the organization, their clients, and their employees.

Project team: Individuals completing the work on the project. Are properly skilled, allocated to optimize project efficiency and effectiveness, and physically located where they can have the most value to the project.

Project workbook/notebook: A shared repository where all finalized project documents are stored after they are updated with final project information during Project Closure.

Proportional rule: An Earned Value rule where the actual effort or duration spent so far on an activity determines the portion of the activity that is complete (and value earned). This rule is the most common rule used.

Pure Project organization: A project structure where the project manager has full authority (all resources work for the project manager). Resources only work on that one project and work on project tasks full time. Also known as a projectized organization.

Purpose: A simple business statement to describe what the project is about and link it to a business objective/goal (the justification for the project).

Quality audit: "A structured, independent process to determine if project activities comply with organizational and project policies, processes, and procedures" (definition from PMI). A review of the processes used on a project to identify improvements and efficiencies. May also be referred to as a Project Health Check.

Quality Plan: Documents the processes and activities necessary to ensure the deliverables produced during the project meet the requirements of the Stakeholders and the project objectives. Also includes quality metrics to ensure the project itself is performing with efficiency.

Requirements: Capabilities, functions, or conditions that must be met in order to achieve the project objectives.

Requirements Traceability Matrix: "A grid that links product requirements from their origin to the deliverables that satisfy them" (definition from PMI). Documents requirements with associated objectives and deliverables, priority, and tests for determining if a requirement is met.

Resource leveling: "A technique in which start and finish dates are adjusted based on resource constraints with the goal of balancing demand for resources with the available supply" (definition from PMI). Changes the schedule to shift activities to fit when resources are available (resolves resource overallocation/constrained resources but likely elongates the project).

Resource smoothing: "A technique which adjusts the activities of a schedule model such that the requirement for resources on the project do not exceed certain predefined resource limits" (definition from PMI). Uses available float to shift activities to smooth out resource usage (helps resolve some resource overallocation/constrained resources without elongating the project).

Resources: The "skilled human resources, equipment, services, supplies, commodities, material, budgets, or funds" required in order to complete the project. (definition adapted from PMI)

Risk: "An uncertain event or condition that, if it occurs, has a positive or negative effect on one or more project objectives." (definition from PMI)

Risk Priority Number (RPN): A qualitative risk analysis strategy that uses scales of 1 to 5 or 1 to 10 for the probability, impact, and ease of detection to assist with the prioritization of risks. The three scale values are multiplied together to get the RPN. The higher the RPN, the greater the risk.

Risk Register/Log: "A document in which the results of risk analysis and risk response planning are recorded" (defintion from PMI). A living document to identify, analyze, and plan responses and contingency for risks during Project Planning, then used to help monitor and control risks during Project Execution.

Risk response plan: A specific proactive action that we will take to address the risk in advance of it happening with the intent to avoid it outright, to mitigate or lessen its impact and/or probability, or to transfer the risk to a third party). The plan is tied to the strategy selected.

Risk response strategy: A general strategy for handling a risk. Response plan strategies for negative impact risks: accept, mitigate, avoid, transfer. Response plan strategies for positive impact risks: accept, enhance, exploit, share.

Schedule Performance Index (SPI): A ratio of the Earned Value to the Planned Value that tells us how efficient we are at managing our schedule. SPI = EV/PV

Schedule variance (SV): The difference between the Earned Value of work done and the Planned (baseline) Value of work done. SV = EV - PV

Scope: All the work and deliverables required to deliver the product or result and satisfy the objectives of the project.

Scope creep: "The uncontrolled expansion to product or project scope without adjustments to time, cost, and resources." (definition from PMI).

Sequencing: The order of activities and their predecessor relationships. Provides the schedule of activities when laid out over a timeline.

Software estimating: Software uses project historical information, statistical analysis and/or simulations to determine the cost estimate based on set characteristics/criteria. Software also analyzes estimates to provide a probability of success for each estimate. Example is a Monte Carlo simulation.

Sponsor: A key stakeholder who enables the project and the Project Manager by providing whatever support necessary to ensure the success of the project. Usually a manager or executive of the organization.

Stakeholder: People or groups who will use or benefit from the project, provide resources to the project, participate in the project, who are impacted by the project, or are otherwise interested in the performance of the project.

Stakeholder Plan: Identifies all stakeholders and their roles. Documents the plan for engagement of each stakeholder based on role, influence, and interest.

Status report: A short report (1 page report) that shares things such as project measures and their performance history and variance, high priority risks and issues, Earned Value, Change Order summary, and Milestones achieved. Shared on a defined schedule.

Successor activity: An "activity that follows a predecessor activity, as determined by their logical relationship" (definition from PMI).

Team Plan: Documents the personnel required to ensure a successful project (availability, start and end dates) and how a positive team environment will be created (training/development, recognition, synergy). Also known as a Human Resourcing Plan.

Time (Schedule): The timeline of the project, including milestones.

Top-down estimating: Estimates costs at the project level or deliverable level, then allocates costs downward to the detailed activities. Types include parametric, analogous, group decision making, and software estimating.

Transfer risk: Risk response strategy where we take preventative action to transfer the risk to a third party who may be better equipped to deal with it. Often requires additional budget.

Triple Constraint: The combination of scope, time/schedule, and cost as the primary constraints of a project. These are competing factors and must always be kept in balance with each other.

Variance: "A quantifiable deviation from a known baseline or expected value" (adapted from PMI definition). How far a project is "allowed" to deviate from the baseline metric during Execution before action must be taken to adjust the project.

Version control: A history (list) of when a document was originally approved and by whom, as well as any subsequent, agreed-to changes by the Change Control Board.

Virtual team: Team members are located in different places, often near key stakeholders or customers. They often use virtual communication tools such as email and web conferencing software.

Work Breakdown Structure (WBS): "A hierarchical decomposition of the total scope of work to be carried out by the project team to accomplish the project objectives and create the required deliverables" (definition from PMI). Documents the breakdown of work from the highest level (the project), to the deliverable or Work Package level, to the lowest level of work (the activities). Often a tree diagram or outline format.

Work Package: A set of activities or tasks that must be performed in order to create its associated deliverable.

0/100 rule: An Earned Value rule where you can only earn the value of the activity after it is 100% complete.

50/50 rule: An Earned Value rule where you earn 50% of the value of the activity when it starts, and 50% of the value of the activity after it is completed.