Important PMP Terms & Concepts


PMP Terms & Concepts

Learning PMP Terms & Concepts

There are loads of terms and concepts to learn when it comes to project management and particularly for PMP. You will not be asked to derive definitions in the PMP© exam as its a multiple choice but being able to identify what a term or concept is used in relation to. This will help you use the process of elimination for questions that you don’t know an answer for. After I did my initial studying and started taking exams I created the below study notes which I would revise before each exam and then add new concepts I might of mixed up during the practice exam. I recommend you to also write out any terms or concepts you might not be clear with or got wrong in an practice exam so you can revise and improve your knowledge in the area.

Initiation Terms & Concepts

Process A package of inputs, tools and outputs
Phase A group of logically related activities which produce deliverables at the end of the phase.
Following represent end of a phase…
> Kill Point
> Stage Gate
> Milestone
> Phase Review
> Phase Gate
Phase-to-Phase Relationship Sequential: Finish-to-Start
Overlapping: Schedule Compression ie. Fast tracking
Parallel
Project Temporary endeavour
Create unique product/service
Defined time period
Program Group of coordinated projects towards a common goal
Portfolio Group of programs/projects to achieve organizational strategic goals
Why Projects? > Market Demand
> Organizational Need
> Customer Request
> Technological Advance
> Legal Requirements
> Support org strategic plan
Progressive Elaboration Analysis and estimation can be more accurate and elaborated as project progresses. (Rolling Wave Planning)

Project Management

Project Management The application of knowledge, skills, tools & techniques to project activities to meet the project requirements
Project Management Team Subset of project team. Responsible for all activities, referred to as core, executive or leadership team.
PMBOK Framework/Standard but not a methodology
PRINCE Projects IN Controlled Environments
Competing Constraints Time, Cost, Scope, Quality, Risk, Resources
Project Management Office (PMO) > Standardizes Governance
> Provides Training
> Shares Tools
> Templates
> Resources
Project Reports Formal and informal project reports which describe…
> Status
> Lessons Learned
> Issue Logs
> Closure Reports
> Outputs from knowledge areas
Enterprise Environmental Factors May enhance or constrain project management processes and may have a positive or negative impact on outcome.
Organizational Project Management (OPM) > Strategy execution framework utilizing portfolios, programs and projects and organizational enabling practices (technology, culture etc.)
> Linking management principles with strategy and advance capabilities
Management by Objective (MBO) Process of defining objectives within an organization so that management and employees agree to objectives and understand what they need to do in the organization in order to achieve them
Project Lifecycle Initiating, Planning, Executing, Closing
> Predictive: (Waterfall) Scope, Time, Cost determined early in project
> Iterative: (Incremental) Repeat the phases until exit criteria are met
> Adaptive: (Agile) High change rate each iteration very short 2-4 weeks
Product Lifecycle Development, Production, Adoption & Growth, Maturity, Decline, End of Life
Each phase within product lifecycle may include all project process groups
PMI Approach Sexism, Racism or any discrimination never accepted
Adhere to local customs including paying bribe if deemed necessary and acceptable

Project Manager

PM May Report To > Functional Manager
> Program Manager
> PMO Manager
> Operation Manager
> Senior Management (Must be consulted for changes to high level constraints)
Interpersonal Skills > Communication
> Leadership
– Autocratic: Makes decisions themselves
– Directing: Instructs people on tasks when/how
– Laissez Faire: Does not interfere
– Democratic:  Guides but doesn’t interfere
– Delegating: Delegates tasks
– Coaching: Instructs
– Discussing: Two-way communication
– Facilitating: Coordinates inputs from several sources
– Supportive: Positive assistance and encouragement
– Participatory: Involves others
– Task-orientated: Enforces tasks
– Assertive: Confronts issues
> Motivation
> Influence
> Negotiation
> Trust Building
> Political and Cultural Awareness
Interpersonal Influences > Legitimate Power: Official empowered
> Reward Power: Salary, Bonuses
> Penalty Power: Punishment
> Expert Power: Knowledge *Best Power
> Referent Power: Personally attracted – friend of CEO
PM Responsibility > 90% of time on communication with stakeholders
> Leader of project irrespective of authority
> Should consider every process if applicable for project
> Identifies and document conflicts of project objectives with organization strategy as early as possible
> Involves team members in planning process

 

Organization Types

Projectized Project manager has ultimate authority over project
Matrix > Strong: PM has authority
> Balanced: Share authority
> Weak: Functional Manager has authority, PM considered Expeditor
> Multiple Bosses so more complex
Functional Organization > Project Manager has little authority
> Project Expeditor – No Authority
> Project Coordinator – Little Authority
Composite Combination of different types
Project Based Organization (PBO) > Conduct majority of work via projects over functional approaches
> Departments with functional organizations
> Matrix Organizations
> Projectized Organizations
Tight Matrix Is when team collocated and nothing to do with organization type

Other Important Terms

Project Charter > Officially creates project
> Formally assigns PM
> Contains external constraints and assumptions
> Includes high level milestone schedule
Project Management Plan > Collection of subsidiary plans
> Formal, written communication
> Approved by sponsor
Project Scope Statement > Progressively Elaborated
Making Changes > Authority to Approve Changes: The Scope Mgmt. Plan is the document that specifies how changes to the scope will be managed
> Changing Scope to Avoid Risk: After risk has been qualified, quantified should it mean changing scope
> Work Authorization: Defines when and how work is to be completed
Perform Integrated Change Control > Have change control meetings
> Output change request status updates
Cost-reimbursable Pays costs for materials and services and fee on top of it
Standard Deviation > Used to measure diversity
> P-O/6> Standard Deviation for entire path
Square standard deviation to get variance
Square root sum of variance
Six Sigma > Six Sigma = Mean +/- Standard Deviation
> 1 Sigma = 68%
2 Sigma = 95%
6 Sigma = 99.97%
Quality Management Theory Planning for quality must be emphasized
Stakeholders > Can be effected positively/negatively by a project
1. Power/Interest Grid: Level of authority and concern
2. Power/Influence Grid: Level of authority and involvement
3. Influence/Impact Grid: Level of involvement and effect of changes
4. Salience Model: Power/Urgency/Legitimacy
> Stakeholder Register: Identification, Requirements, expectations, Influence, Classification
Customer Satisfaction Ensure product team build meets customer requirements. Profitable project does not mean customer satisfaction
Conflict > Direct confrontation is best policy
Blake & Mouton 5 Modes for Handling Conflicts
1. Withdrawal – Retreat
2. Smoothing – Deemphasize Source of Conflict
3. Compromise – Bargain usually lose-lose
4. Forcing – Choose one viewpoint
5. Confrontation – Facing the conflict directly
Conflicts Occur 1. Schedules
2. Priorities
3. Resources
4. Technical
5. Procedures
6. Personality
7. Costs
Unresolved Issues Lead to a major source of conflict
Estimating > Analogous Estimating: Top down estimating
> Parametric Estimating: Statistical relationship between historical data and other variables
> Bottom Up Estimating: Most detailed estimation by calculating per work package and takes the longest
Control Communications Process of monitoring and controlling communications throughout project lifecycle
Communication Type > Formal Written: Contracts
> Informal Written: Email
> Formal Verbal: Speeches
> Informal Written: 1 to 1 meeting
McClelland’s Three Need Theory Achievement, Power Affiliation
Product Analysis > Product Breakdown
> Systems Analysis
> Requirements Analysis
> Systems Engineering
> Value Engineering
> Value Analysis
Depreciation Decrease in value over time. 2 types….
1. Straight Line Deprecation: Same amount every year
2. Accelerated Depreciation:
A) Double Declining Balance (Fastest type of depreciation)
B) Sum of Years Digits (Add up years ie.3 years 1+2+3=6 then calculate year by year 3/6 x Asset Cost. Year 2 would be 2/6 x Asset Cost
Opportunity Cost Cost of passing up on best option A = 15,000 B = 10,000 C = 5,000 you choose A the opportunity cost would be 10,000
Failure Costs > Rework products
> Components
> Process non-compliant
> Cost of work and waste
> Loss of reputation
Lifecycle Costs Not responsibility of project includes…
> Direct and indirect
> Periodic or continuing
Configuration Management Activities  It is the basis of project communication and controlling changes that affect the project, such as requirements or design change.
> Formal identifies and documents physical and functional characteristic of the Configurable Items
> Controls changes to the characteristics of Configurable Items
> Record the history of changes done on configurable items
> Support the audit of these Configurable Items to verify conformance to the requirement
Attribute Sampling Binary either conforms or not
Variable Sampling Continuous process that measures against degree of conformity
Analytical Financial Techniques > Payback Period
> ROI
> IRR
> Discounted Cash flow
> Net Present Value
DMAIC Define Measure Analyse Improve Control
Administrative Closure Final completion and closure of project
Contract Closure Closed upon reaching end of contract
Independent Estimates Check proposed pricing by procuring organization by asking reliable source for price to use as base
Design of Experiments Identifies which variables have most influence on quality outcome
Contingency Reserves Known unknowns
Management Reserve Unknown unknowns
Cost Baseline = Contingency & Cost Estimates
Project Budget = Cost Baseline & Reserve
Cost Performance Baseline This is the BUDGET
Special Cause Unusual & preventable ie.preditcable
Common/Normal Causes Accepted causes that are determined to happen so infrequently are considered random
Code of Accounts Unique lettering system used in WBS
Journey to Ailbhe Organization takes actions to contradict to what they really want ie. People agree to org goals but personally disagree
Constructive Change A undocumented change recommended by a party
Total Point of Assumption Where seller bears all the loses of additional cost overrun only in fixed price incentive fee contracts!
Closing Process 1. Get formal acceptance
2. Close contracts
3. Write lessons learned
4. Release the team
Administer Procurement Other name for monitor and control procurement
Records Mgmt. System Used in procurement process to store contracts and any related documents
Active Risk Response Establish contingency reserve including amount of time and money to handle
Residual Risk Risk that occurs after all risk responses have been implemented
Secondary Risk Risk that occurs as a result of implementing a risk response
Risk Analysis Qualitative means judgement
Quantitative means numbers
Risk Breakdown Structure Created in Plan Risk Management to categorize risks
Kaizen Means improvement
Rough Order of Magnitude Range is -50% to +50%
Staffing Management Plan Includes….
> Rewards and recognition
> Training requirements
> Release plan
Kick-off Meeting Happens start of each phase
Project Selection Methods 1. Benefit Measurement Model – Comparative Approach
> Scoring Models
> Cost-benefit Analysis
> Review/Murder Board
> Economic Models
2. Constrained Optimization – Mathematical Approach
> Linear Programming
> Nonlinear Programming
> Integer Programming
> Dynamic Programming
> Multi-objective Programming
Geert Hofstede – Cultural Dimensions > Power Sharing
> Uncertainty Avoidance
> Individualism
> Masculinity-femininity
> Time Orientation
CSOW Contract statement of Work

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