CAPM Exam Objective

The Project Management Framework

Percentage of Exam
4 percent (approximately 6 questions)

The Project Life Cycle and Organization

4 percent (approximately 6 questions)

The Project Management Processes for a Project 11 percent (approximately 17 questions)

Project Integration Management
Project Scope Management

11 percent (approximately 17 questions)

11 percent (approximately 17 questions)

Project Time Management

11 percent (approximately 17 questions)

Project Cost Management

9 percent (approximately 14 questions)

Project Quality Management

7 percent (approximately 11 questions)

Project Human Resources Management

7 percent (approximately 11 questions)

Project Communications Management

7 percent (approximately 11 questions)

Project Risk Management

11 percent (approximately 17 questions)

Project Procurement Management

7 percent (approximately 11 questions)

General Project Management Terms

A project is a temporary (finite) group of related tasks undertaken to create a unique
product, service, or result. It is time limited, unique, comprised of interrelated activities,
and undertaken for a purpose.
Process: a package of inputs, tools, and outputs used together to do something on a
project.
There are 47 unique processes that are part of the PMBOK.
Phases: each Phase of a project produces one or more deliverables. Any and all processes
in the PMBOK can take place within each phase of a project.
Exit gate or kill point is an evaluation of the deliverables of one project phase to
determine if the project should continue and the next phase should be initiated.
A program is a larger effort a group of related projects coordinated together.
A project portfolio represents the companys entire investment in programs and projects.
Progressive elaboration not all of the characteristics about a product are known when
you begin a project. Requirements are revisited and refined frequently.

Project management is using skills, knowledge, and resources to satisfy project

requirements.
Historical information is found in the records kept on previous projects and is often
used as input to processes to help predict trends and set benchmarks.
Baseline is the original plan (including time, scope, cost) including all approved changes
and is used to measure how performance deviates from the plan.
Lessons learned are the documents focused on variances created at the end of each
process.

Project Roles
Project Manager: the person ultimately responsible for the outcome of the project. The
Project Manager is in charge of the project and empowered to use organizational resources, spend
the project budget, and make decisions for the project.
Project Coordinator: similar to project manager role, but in smaller organizations,
functional or matrix.
Project Expeditor: staff assistant with little or no authority; usually found in a functional
organization.
Senior Management: anyone more senior than the project manager; prioritizes projects
and ensures project manager has needed authority and resources.
Functional Manager: usually a department manager; owns the resources that will be used
by the project.
Stakeholder: those whose interest may be + or impacted by the project.
Sponsor: the person(s) paying for the project.
Project Office: serves in a supporting role defines standards, provides best practices,
audits projects for conformance.

Project context organizational environment in which a project is carried out. Often determined
by type of organization. Three major types or of organizations are Functional, Projectized, and
Matrix.
Functional organization: team members work for a department (engineering,
accounting.) but are loaned to a project from time to time. Deeper expertise and specialization,
weaker PM, projects are lower priority.
Projectized organization: structured according to projects, not functions. PM has high
authority, strong team loyalty; team works itself out of a job.
Matrix organization: Strong PM has most of the authority. Weak FM has authority.
Can be best of both, has higher overhead, could have higher friction.

PM Skills include: leading, communicating, negotiating, problem solving, influencing

Project Life Cycle six phases
Conceptual
Planning
Construction
Testing
Implementation
Closure
The triple constraint Time / Cost / Scope or Quality are inter-related. One cannot change
without having an impact on the other(s)
Expanded view of this concept includes Time / Cost / Scope / Quality / Risk / Customer
Satisfaction
Common Inputs, Tools, Techniques, Outputs
PMBOK recognizes 592 inputs, tools, techniques, outputs across the 47 PM processes
(47 processes are grouped into 5 process groups across 9 knowledge areas)
Common inputs include:
o Enterprise environmental factors company structure, values, work ethic, laws
and regulations, overall marketplace
o Organizational process assets templates, policies, procedures, tools, knowledge
bases, historical information
o Project management plan (PMP) project scope, schedule, resources, cost,
quality mgmt, process improvement, staffing, communications, risk and
procurement management.
o Work Performance Info
Common tools include:
o Analytical techniques (different ones for different processes)
o Expert judgment
o Project management methodology how the 44 processes are used / applied to
form the overall project mgmt strategy.
o Project management information systems (PMIS) tool that helps track project
documents and deliverables (encompasses change management system and
configuration management system)
Common outputs include:
o PMP updates
o Project document updates

Change requests (updates and change requests are typical in Control

groups)Ch 3 Process Framework

Terms:
Process: composed of inputs, tools and techniques, and outputs.
Inputs: the starting point for a process.
Tools and Techniques: actions or methods used to transform inputs into outputs
Outputs: the ends of the process efforts. Often outputs from one process are inputs for another
process.
9 Knowledge Areas:
1. Integration Management
2. Scope Management
3. Time Management
4. Cost Management
5. Quality Management
6. Human Resource Management
7. Communication Management
8. Risk Management
9. Procurement Management
5 Process Groups:
1. Initiating
2. Planning
3. Executing
4. Monitoring and Controlling
5. Closing
Scope of a project is usually progressively elaborated, meaning that processes are preformed
iteratively, not in a linear manner. All processes could be performed in one or more of the project
phases.

Table 3-1 in PMBOK 5

Process Groups-->
---------------------- |
Knowledge Areas v

Initiating

Planning

Executing

Monitor & Control

Closing

Integration

Develop Project Charter

Develop Project Mgmt Plan

Direct and Manage Project Work

Monitor & Control Project Work

Perform Integrated Change
Control

Close Project or Phase

Plan Scope Management

Collect Requirements
Define Scope
Create WBS
Plan Schedule Management
Define Activities
Sequence Activities
Estimate Activity Resources
Estimate Activity Durations
Develop Schedule
Plan Cost Management
Estimate Costs
Determine Budget

Scope
Time

Cost

Validate Scope
Control Scope
Control Schedule

Control Costs

Quality

Plan Quality Management

Perform Quality Assurance

HR

Plan Human Resource

Management

Acquire Project Team

Develop Project Team
Manage Project Team

Communication

Plan Communications
Management

Manage Communications

Risk

Plan Risk Management

Identify Risks
Perform Qualitative Risk
Analysis
Perform Quantitative Risk
Analysis
Plan Risk Responses
Plan Procurement Management

Procurement
Stakeholder
Management

Identify Stakeholders

Plan Stakeholder Management

Control Quality

Control Communications

Control Risks

Conduct Procurements

Control Procurements

Manage Stakeholder
Engagement

Control Stakeholder
Engagement

Close Procurements

Process Group Breakdown:

Prior to initiating: Project selection. Project selection methods or benefit measurement methods
include:
Benefit Cost Ratio (BCR); Economic Value Add (EVA); Internal Rate of Return
(IRR); Opportunity Cost; Payback Period; Present Value (PV) and Net Present Value (NPV);
Return on Investment (ROI); Return on Invested Capital (ROIC)
PG 1: Initiating (KA: Integration)
Develop Project Charter
Identify Stakeholders
PG 2: Planning (KA: ALL)
Develop Project Management Plan
Plan Scope Management
Collect Requirements
Define Scope
Create WBS
Plan Schedule Management
Define Activities
Sequence Activities
Estimate Activity Resources
Estimate Activity Durations
Develop Schedule
Plan Cost Management
Estimate Costs
Determine Budget
Plan Quality Management
Plan Human Resource Management
Plan Communications Management
Plan Risk Management
Identify Risks
Perform Qualitative Risk Analysis
Perform Quantitative Risk Analysis
Plan Risk Responses
Plan Procurement Management
Plan Stakeholder Management
! Project Planning is extremely important the 24 processes touch every one of the knowledge
areas.
PG 3: Executing (KA: Integration, Quality, HR, Communication, Procurement)
! Executing process involve the most actual work.
Direct and Manage Project Work
Perform Quality Assurance
Acquire Project Team
Develop Project Team
Manage Project Team

Manage Communications
Conduct Procurements
Manage Stakeholder Engagements

PG 4: Monitoring and Controlling (KA: ALL)

! measure, inspect, review, compare, monitor, verify, report all keywords part of this process
group.
Monitor and Control Project Work
Perform Integrated Change Control
Validate Scope
Control Scope
Control Schedule
Control Costs
Control Quality
Control Communications
Control Risk
Control Procurements
Control Stakeholder Engagement
PG5: Closing (KA: Integration, Procurement)
Close Project or Phase
Close Procurements

Knowledge Area Breakdown:

------------------------------------------------Integration Management (Ch. 4)
Integration
PG1 - Initiating: Develop Project Charter -- one of the first processes performed. Project
Charter is one of the most important documents in a project.
Inputs:
Project SOW (statement of work) written description of the products, services,
results.
Business case
Agreements (contract - if relevant, contract is signed prior to project beginning)
Enterprise environmental factors
Organizational process assets
Tools:
Expert judgment
Facilitation techniques meetings, brainstorming
Outputs:
Project Charter written by the sponsor. Authorizes the project to commence
o Based on business need, customer request, or market force
o Signed by senior management of performing organization
o Vision statement/project purpose
o Business case
o Project sponsor name, roles, responsibilities
o Project manager name and responsibilities
o Summary milestones
o Key risks, assumptions, dependencies
o Summary preliminary budget
o Pre-assigned resources
Integration
PG2 - Planning: Develop Project Management Plan
Project Plan should be B.A.R.F.
Bought into
Approved
Realistic
Formal
PMBOK defines the project plan as A formal, approved document that defines how the
project is managed, executed, and controlled. It may be summary or detailed and may be
composed of one or more subsidiary management plans and other planning documents.
Inputs:
Project charter
Outputs from other processes (management plans)
Enterprise environmental factors
Organizational process assets

Tools:
Expert judgment
Facilitation techniques
Outputs:
PMP each of these documents is a how... delineates strategy
o Change management plan
o Communications management plant
o Configuration management plan
o Cost management plan
o HR management plan
o Process improvement plan
o Procurement management plan
o Quality management plan
o Requirements management plan
o Risk management plan
o Schedule management plan
o Scope management plan
o Stakeholder management plan
o Three baselines (scope, cost, time)
Integration
PG3 - Executing: Direct & Manage Project Work
Project team is executing the work package and creating the project deliverables.
Inputs:
PMP
Approved change requests
Enterprise environmental factors
Organizational process assets
Tools:
Project management information systems (PMIS) think Microsoft Project
Expert judgment
Meetings
Outputs:
Deliverables
Work performance data
Change requests
PMP updates
Project documents updates
Integration
PG 4 Monitor and Control: Monitor & Control Project Work
Monitoring project work takes place as long as there is work to be done.
Inputs:
PMP
Schedule forecasts

Cost forecasts
Validated changes
Work performance information
Enterprise environmental factors
Organizational process assets
Tools:
Expert judgment
Analytical techniques
Earned Value Technique used to measure project progress and forecast
future project performance
Root cause analysis
Forecasting methods (time series, scenario building, simulation, etc)
Failure mode and effect analysis (FMEA)
Fault tree analysis
Reserve analysis
Trend analysis
Variance analysis
PMIS
Meetings
Outputs:
Change requests
Work performance reports
PMP updates
Project documents updates
Integration
PG 4 Monitor and Control: Perform Integrated Change Control
One of the most important processes! Focused on managing changes to the project scope.
Inputs:
PMP
Work performance reports
Change requests
Enterprise environmental factors
Organizational process assets
Tools:
Expert judgment
Meetings
Change control tools
Outputs:
Approved change requests
Change log (contains both approved and rejected requests)
PMP updates
Project documents updates
Integration

PG 5 Closing: Close Project

Inputs:
PMP
Accepted deliverables
Organizational process assets
Tools:
Expert judgment
Analytical techniques
Meetings
Outputs:
Final product(s), service(s), result(s) (acceptance implied)
Organizational process assets updates
Scope Management (Ch 5)
The project manager should always be in control of the scope through rigid management of
requirements, details, and processes. Scope changes should be handled in a structured,
procedural, and controlled manner. Project managers should work proactively to indentify and
influence the factors that might cause change.
The overall goals of scope management are to define the need, set stakeholder expectations,
deliver to the expectations, manage changes, minimize surprises and gain acceptance of the
product.
The Scope Management Process includes:
Creating a plan for how scope and scope changes will be managed
Defining and documenting deliverables that are part of the project
Creating the work breakdown structure (WBS)
Checking the work being done against the scope
Ensuring that all of what is in scope and only what is in scope is completed.
Scope
PG2 Planning: Plan Scope Management
Inputs:
PMP
Project charter
Enterprise environmental factors
Organizational process assets
Tools:
Expert judgment
Meetings
Outputs:

Scope management plan defines what activities the team will perform in order
to gather the project requirements, create the work breakdown structure, document the scope,
control scope, and verify that all in-scope and only in-scope work was performed.
Requirements management plan how requirements will be tracked, reported,
prioritized
Scope
PG2 Planning: Collect Requirements
Inputs:
Scope management plan
Requirements management plan
Stakeholder management plan
Project charter
Stakeholder register
Tools:
Interviews
Focus groups
Facilitated workshops
Group creativity techniques brainstorming, nominal group technique (ranking
and voting), idea/mind mapping, affinity diagrams, multi-criteria decision analysis
Group decision-making techniques unanimity, majority, plurality (largest
block), and dictatorship
Questionnaires and surveys
Observations
Prototypes
Benchmarking
Context diagrams
Document analysis
Outputs:
Requirements documentation
Requirements traceability matrix where did these requirements come from?
Scope
PG2 Planning: Define Scope
This is the process where the projects requirements are gathered and documented.
Inputs:
Scope management plan
Project charter
Requirements documentation
Organizational process assets
Tools:
Expert judgment
Product analysis
Alternatives generation
Facilitated workshops

Outputs:
Project scope statement used to level-set among project stakeholders. Describes
inclusions and exclusions, constraints and assumptions, key deliverables.
Project documents updates stakeholder register, requirements
documentation/traceability matrix.
Scope
PG2 Planning: Create Work Breakdown Structure
!!This is one of the most important processes.
After it is created, the WBS becomes a hub of information for the project
WBS is typically created early in the project after scope and requirements, but before the bulk
of the work is executed
Inputs:
Scope management plan
Project scope statement
Requirements documentation
Enterprise environmental factors
Organizational process assets
Tools:
Expert judgment
WBS templates may be examples from previous projects,
!Decomposition breaking down project deliverables into smaller components.
Each level is more and more specific. The smaller, more manageable pieces, called work
packages can be:
Estimated confidently
Cannot be divided further
Can be completed quickly
Have meaningful deliverables
Can be completed without interruption
Are typically numbered for ease of location
Outputs:
Scope baseline
Project documents updates
WBS graphical, hierarchical chart. Deliverable-focused

1. Online
Ordering
Application
90 days /
$85,000.
1.1 Hardware
15 days /
$15,000

1.2 Design
30 days /
$25,000

1.3
Development

1.1.1 Define
HW
Requirements

1.2.1 Create
initial tables
and indexes

1.1.2 Procure
HW

1.2.2
Normalize
tables and
indexes

1.3.1.1 create
login screen

1.1.3
Configure HW

1.2.3 Validate
design

1.3.1.2 create
order screen

1.3.1 Develop
Screens

1.4 Testing

1.3.2 Develop
Reports

1.4.1
Functionality
Testing

1.3.3 Integrate
with Shipping
Systems

1.4.2 User
Acceptance
Testing

1.3.1.3 create
payment
screen

The Elements of a Good Work Breakdown Structure (WBS):

o Detailed down to a low level the lowest level defines every
deliverable
o Graphical / Pyramid, with each sub-level rolling up to the level
above
o Each element is numbered
o Provides sufficient detail to drive subsequent planning
o Thorough and Complete if it is not in the WBS, it is not a
project deliverable
o Created by the project team, helps define responsibilities.
WBS Dictionary captures additional attributes about each work package that do
not fit into WBS.
Project: Online Ordering Application
Work Package ID: 1.1.3 Configure Hardware
Work Package Description: all new hardware must be configured according to standards
includes all settings and operating system patches, formatting of storage devices, installation of
virus software, and hardening according to guidelines.
Assigned to: Jon Smith
Department: IT
Date Assigned: 05/01/09
Date Due: 0630/10
Est. Cost: $6,000
Accounting Code: OOA-113
Project Scope Mgmt Plan Updates
Scope Baseline combination of the project scope, WBS and WBS dictionary.
Requested Changes
Scope
PG4 Monitor and Control: Validate Scope
Sponsor acceptance or rejection of deliverables. The requirements documentation brings
objectivity to the project
Inputs
PMP
Requirements documentation & traceability matrix
Verified deliverables
Work performance data

Tools
Inspection a point-by-point review of the scope and associated deliverables.
Group decision making techniques
Outputs
Accepted deliverables
Change requests
Work performance information
Project documents updates
Scope
PG4 Monitor and Control: Control Scope
Controlling the scope and the project by preventing scope change requests from overwhelming
the project.
Inputs
PMP
Requirements documentation & traceability matrix
Work performance data
Organizational process assets
Tools
Variance Analysis
Re-planning
Configuration Management System (the umbrella over all change control
systems)
Outputs
Work performance information
Change requests
PMP updates
Project documents updates
Organizational process asset updates

Time Management (Ch 6)

Project Manager should be in control of the schedule. Schedule is built from ground up and
rigorously managed throughout the life of the project. The driving philosophy behind time
management is mathematical it is cold, hard analysis.
Time, Cost, and Scope are particularly tightly linked a change in one will almost certainly
impact the other(s.)
The Time Management Process includes:
Plan Schedule Management
Define Activities
Sequence Activities

Estimate Activity Resources

Estimate Activity Durations
Develop Schedule
Control Schedule

Time
PG2 Planning: Plan Schedule Management
Inputs
PMP
Project charter
Enterprise environmental factors
Organizational process assets
Tools
Expert judgment
Analytical techniques (critical path, critical chain)
Meetings
Outputs
Schedule Management Plan
Time
PG2 Planning: Define Activities
Using the decomposed WBS, a granular activity list is created to focus on how and when each
work activity is to be accomplished.
Inputs
Schedule management plan
Scope baseline
Enterprise environmental factors
Organizational process assets
Tools
Decomposition each work package at the bottom of the WBS is decomposed
into smaller scheduled activities.
Rolling Wave Planning a form of progressive elaboration that assumes that
things in the near future are relatively clear, while future project activities are not as easily
understood. This is revisited throughout the project.
Expert Judgment
Outputs
Activity list all of the scheduled activities that need to be performed in order to
complete the project
Activity attributes
Milestone list Key project milestones are identified and will be used to build
the schedule
Time

PG2 Planning: Sequence Activities

Taking the activity list and arranging the activities in the order they must be performed.
It is performed after activity definition and before schedule development.
Inputs
Schedule management plan
Activity list the most important input to this process
Activity attributes
Milestone list
Project scope statement
Enterprise environmental factors
Organizational process assets
Tools
Precedence Diagramming Method (PDM) the most commonly used.
activities represented by rectangular nodes, dependencies between
activities represented by arrows, units of duration are shown above the nodes.
Also known as AON activity on node
4 types of relationships Finish to Start, S to F, S to S and F to F
Arrow Diagramming Method (ADM)
activities are on the arrows, circle nodes are connecting points
Also known as AOA activity on arrow
Only F-S, but can contain 0 duration dummy activities
Schedule Network Templates
Dependency determinations those things that influence which activities must
be performed first. There are three kinds of dependencies:
Mandatory dependencies aka hard logic, always true
Discretionary dependencies aka soft or preferred logic
External dependencies outside of project scope, but must be
considered.
Leads and lags
Leads an activity gets a jump start
Lags a waiting period must exist between activities; usually no work is
being performed
Outputs
Project schedule network diagram -- not a schedule, but activities arranged in
the order they must be preformed.
Project documents updates
Time
PG2 Planning: Estimate Activity Resources
A function of the size of activity and the number and availability of resources to be applied to it.
Inputs
Schedule management plan
Activity list the most important input to this process
Activity attributes/Activity cost estimates
Resource calendars

Risk register
Activity cost estimates
Enterprise environmental factors
Organizational process assets
Tools
Expert judgment
Alternatives analysis
Published estimating data
Bottom-up estimating (most accurate but time consuming)
Project management software
Outputs
Activity resource requirements
Resource breakdown structure (RBS)
Project document updates
Resource calendar updates
Change requests
Activity attribute updates
Time
PG2 Planning: Estimate Activity Durations
Each activity in the activity list is analyzed to estimate how long it will take.
Inputs
Schedule management plan
Activity list primary input
Activity attributes
Activity resource requirements
Resource calendar shows physical and human resource usage across the project
Project scope statement
Risk register
RBS
Enterprise organizational factors
Organizational process assets
Tools
Expert judgment
Analogous estimating (aka top-down estimating) activity from a previous
project is used to estimate activity duration. Less accurate that parametric, but more expedient.
Parametric estimating linear extrapolation, i.e. if 1 team can install 100 ft in 1
day, it takes 10 teams to install 1,000 feet in 1 day.
Three-point estimates (aka PERT) uses three data points instead of one
(pessimistic, most likely or realistic, and optimistic)
Simple/unweighted (P+R+O)/3 standard dev (P-O)/3
Pert/Beta distribution (P + 4*R + O) / 6
standard deviation for PERT P
O/6
Group decision making techniques- Delphi (anonymous)
Reverse analysis (aka contingency) extra time added to a schedule activity
duration estimate. Contingency reserve and management reserve

Outputs
Activity duration estimates
- the main output; contains an estimated
duration for each activity in the activity list.
Project document updates (activity attribute updates)
Time
PG2 Planning: Develop Schedule
One of the largest PMBOK processes, as well as one of the most visible and most important parts
of the project plan.
Inputs
Schedule management plan
Activity list
Activity attributes
Project schedule network diagrams
Activity resource requirements
Project scope statement
Risk register
Project staff assignments
RBS
Enterprise organizational factors
Organizational process assets
Tools
Schedule Network Analysis a group of tools used to create a schedule
Critical Path Method (CPM) the combination of activities that, if any are
delayed, will delay the project finish. Used to calculate the project finish date and identify how
much individual activities can slip or float.
One Method To calculate critical path. Network diagram. Add duration and subtract 1
(Starts on day 1, it takes 3 days so finishes on day 3. The next activity can start on day 4)
ES and EF Early Start and Early Finish. Forward pass
LS and LF Late Start and Late Finish. Backward pass
Float (aka slack) amt of time an activity can be delayed w/out impacting project
You cant add float together. Total float is the longest float
Schedule Compression ways to complete the project schedule early without
cutting scope. Crashing involves adding resources to a project and almost always increases cost.
Fast Tracking is a re-ordering of activities so that some are performed in parallel does not
increase cost, but often increases risk.
Modeling techniques
What-If Schedule Analysis (Monte Carlo) computer analysis to
identify highest risk activities.
Resource optimization techniques
Leveling adjusting resource allocation to match up with the
organizations ability to supply resources.
Smoothing
Critical chain method Remove buffer time from activities and make a total
buffer visible.
Adjusting leads and lags

Scheduling tool
Outputs
Schedule baseline the original plan plus all approved changes.
Project schedule shows when each activity is scheduled to begin and end, as
well as overall project start and finish. Typically represented in graphical format using a
Project Network Diagram, Bar or Gantt Chart, or Milestone Chart
Schedule data information used by the project team to model and create the
project schedule.
Project calendars
PMP updates
Project document updates
Time
PG4 Monitor & Control: Control Schedule
Control Schedule is performed throughout the life of the project to make sure that time-related
performance on the project is in line with the plan. Schedule control should be a proactive
process, with the project manager staying out in front of the project.
Inputs
PMP
Project schedule
Work performance data
Project calendars
Schedule data
Organizational process assets
Tools
Performance reviews (trend analysis, checking the buffer time on the critical
chain, earned value management)
Project management software
Resource optimization techniques (leveling and smoothing)
Modeling techniques (Monte Carlo)
Leads and lags
Schedule compression
Scheduling tool
Outputs
Work performance information
Schedule forecasts
Change requests
PMP updates
Project documents updates
Organizational process assets updates
Free Float or Free Slack: the amount of time an activity can be delayed without
affecting the early start date of subsequent dependent activities.

Negative Float: activity start date occurs before a preceding activity finish date.
Indicates schedule problems usually related to immovable constraints or milestones.

Cost Management (Ch 7)

Plan scope first, then schedule, then cost. It is the job of the PM to monitor and control cost
against time, scope, quality and risk.
Planning Processes Plan Cost Management, Estimate Costs, Determine Budget
Controlling Process Cost Control
Life-Cycle Costing looks at the total cost of ownership from purchase through operations and to
disposal.
Value Engineering squeeze as much benefit and value out of each aspect of the project.
Cost
PG2 Planning: Plan Cost Management
Inputs
PMP
Project charter
Enterprise environmental factors
Organizational process assets
Tools
Expert judgment
Analytical techniques
Meetings
Outputs
Cost management plan
Cost
PG2 Planning: Estimate Costs
Activity time and resource estimates are analyzed to produce a cost estimate.
Estimate Type
Rough Order of Magnitude Estimate
Definitive Estimate

Range
- 25% to + 75%
- 5% to + 10%

Typically, the closer in time you are to spending money, the more precise you want your estimate
to be.
Inputs
Cost Management Plan

Human resource management plan

Scope baseline
Project schedule
Risk register
Enterprise Environmental Factors
Organizational Process Assets
Work Breakdown Structure
Tools
Expert judgment
Analogous estimating using previous project results to estimate
Determine resource cost rates
Bottom-Up estimating a separate estimate for each schedule activity
Parametric estimating if 1 costs $100, then 6 will likely cost $600
Three point estimating
Project mgmt software
Vendor bid analysis what the project should cost based on bids from qualified
vendors
Reserve analysis (contingency)
Cost of quality (COQ) testing, training, rework, and scrapping
Cost of conformance prevention and appraisal
Group decision making techniques
Outputs
Activity cost estimates
Basis of estimates
Project document updates
Cost
PG2 Planning: Determine Budget
Aggregating the activity cost estimates to establish an authorized cost baseline.
Inputs
Cost management plan
Scope baseline
Activity cost estimates the primary input
Basis of estimates
Project schedule
Resource calendar
Risk register
Agreements
Organizational process assets
Tools
Cost aggregation aggregating costs at activity level to WBS level
Reserve analysis
Expert judgment
Historical relationships analogous or parametric
Funding limit reconciliation reconciling the available funds with actual work

Outputs
Cost baseline (aka project budget)
Project funding requirements
Project document updates
Cost
PG4 Monitor and Control: Control Costs
Proactive measurement of what was executed against what was planned. Cost Control is
primarily concerned with cost variance positive is good, negative is bad, but both are variance.
Inputs
PMP
Project funding requirements
Work performance data
Organizational process assets
Tools
Earned value management
Forecasting
To-complete performance index (TCPI) - a forward looking number
Performance reviews
Project mgmt software
Reserve analysis
Outputs
Work performance information SV, CPI, etc.
Cost forecasts Estimate at completion (EAC)
Change requests
PMP updates
Project document updates
Organizational process asset updates
Earned Value Terms and Formulas
Term

AKA

Description

Completion

BAC

Planned Value

PV
(BCWS)

Earned Value

EV
(BCWP)

Actual Cost

AC
(ACWP)

How much was

originally
planned for this
project to cost
How much work
should have
been completed
How much work
was actually
completed
during a give
period of time
The money
spent during a
given period
Difference
between what
was expected to
be spent and
what was spend

Cost Variance

CV

Formula
None
Planned % Complete x BAC
EV = Actual % Complete x BAC

Sum of costs for given period

EV AC
Negative is bad - overbudget. Positive is good

Schedule
Variance

SV

Cost
Performance
Index

CPI

Cumulative
CPI

CPIc

Schedule
Performance
Index

SPI

Estimate At
Completion

EAC

Estimate To
Completion

ETC

Variance at
Completion

VAC

TCPI

Difference
between where
we planned to be
and where we
are in the
schedule
The rate at
which project
performance is
meeting cost
expectations
Rate at which
project
performance is
meeting cost
expectation
from start to a
point in time
Rate at which
project
performance is
meeting
schedule
expectations
Projecting total
cost at
completion
based on
performance up
to a point in
time

EV PV

How much will

be spent on the
project based on
past
performance
Difference
between what
was budgeted
and what was
spent
How efficiently
you have to
work to get back
on track

ETC = EAC AC

Negative is bad behind schedule. Positive is good

CPI= EV / AC
Under 1 is bad. Over 1 is good

CPIc = EVc / ACc

SPI = EV / PV
Under 1 is bad. Over 1 is good

VAC = BAC - EAC

Above 1 is bad (more difficult). Under 1 is good

Quality Management (Ch 8)

Quality is the degree to which a set of inherent characteristics fulfill requirements.
Quality is the responsibility of the project manager, and is proactive prevention over
inspection. Based on several leading ideas including TQM, ISO-9000, Six Sigma, Shewart and
Demings Plan-Do-Check-Act cycle.
Others Philip Crosby (zero defects)
Terms and Philosophies:

TQM focuses on the underlying processes.

Continuous Improvement aka Kaizen focus on constant process improvement.
JIT just-in-time zero inventory management.
ISO 9000 part of international standards org. document what you do, do what you
document
Standard Deviation and Six Sigma
68.25% of data points are within 1 standard deviation () from the mean
95.46% within 2
99.73% within 3
99.99966% within 6
Six sigma v lean six sigma the first is concerned with defects, the second with cutting
waste
Special vs. Common Causes special causes are generally preventable by process
improvement. Special causes are assignable.
Quality v grade low grade is not necessarily bad, low quality is
Quality
PG2 Planning: Plan Quality Management
Project Team identifies what the quality specs are and how they will be met. Quality must be
planned in from the start.
Inputs
PMP
Stakeholder register
Risk register
Requirements documentation
Enterprise Environmental Factors
Organizational Process Assets
Tools
Cost-Benefit Analysis benefits of quality activities must outweigh costs
Cost of Quality (COQ) costs that will be realized in order to achieve quality.
Cost of items that do not conform are cost of poor quality or COpQ
Seven basic quality tools
Cause and effect diagrams
Flowcharts
Checksheets tallies data
Pareto diagrams ranked histogram
Histograms
Control charts
Scatter diagram shows correlation
Benchmarking comparing quality standards to other projects
Design of Experiments (DOE) uses data analysis to determine optimal
conditions.
Statistical sampling
Meetings
Outputs

Quality Management Plan

Quality Metrics
Quality Checklists to ensure all steps were performed in sequence.
Process Improvement Plan
Project documents updates
Quality
PG3 Executing: Perform Quality Assurance
Quality Assurance is ongoing process improvement throughout the execution phase.
Inputs
Quality Management Plan
Quality Metrics
Process Improvement Plan
Quality Control Measurements
Project documentation
Tools
Quality management and control tools
Affinity diagrams and tree diagrams grouping things together, such as
for the WBS or root cause analysis
Process decision program chart kind of like flowsheet
Interrelationship diagram
Prioritization matrices
Activity network diagrams
Matrix diagram
Quality Audits the key tool in Perform Quality Assurance. Structured audits
Process Analysis
Outputs
Change requests
Project documents updates
Organizational Process Asset Updates
PMP Updates
Quality
PG4 Monitor and Control: Control Quality
Quality Control looks at specific results to determine if they conform to quality standards. Mostly
works with processing change requests
Statistical Sampling is typically used. Inspection is the primary tool.
Inputs
Quality Mgmt Plan
Quality Metrics
Quality Checklists
Organizational Process Assets
Work Performance Details

Approved Change Requests

Deliverables the primary input to the Quality Control process
Tools
7 basic quality tools
Cause / Effect (Ishikawa or fishbone) diagrams
Control Charts statistical process control. Mean, upper and lower limits
are set. (usually 3 sigmas apart)
Rule of Seven seven or more consecutive data points on one
side of mean should be investigated.
Flowcharting i.e. SIPOC model. Helps with process improvement
Histogram (column / bar chart)
Pareto Chart (Paretos Law 80/20 rule)
Run Chart analyzes trends in quality over time
Scatter diagrams used for spotting trends
Statistical Sampling
Inspection
Defect Repair Review
Outputs
Quality Control Measurements
Validated changes
Verified Deliverables
Work performance information
Change requests
PMP updates
Organizational process asset updates

Human Resource Management (Ch 9)

Leadership, motivation, and conflict resolution are all required project management skills. The
core of human resource management is to define a role for everyone on the project, and define the
responsibilities for each of these roles.
Powers of a PM: Reward, Expert (good) Penalty (bad)
Leadership styles: direct, facilitate, coach, support, autocrat, consult, consensus
4 stages of team formation: forming, storming, norming, performing
Maslows hierarchy: physiological, safety, social, esteem, self actualization
Herzbergs motivation-hygiene theory:
Leading to Dissatisfaction
Leading to Satisfaction
Company policy
Achievement
Supervision
Recognition
Relationship w/Boss
Work Itself
Work conditions
Responsibility
Salary
Advancement
Relationship w/Peers
Growth

HR
PG2 Planning: Plan Human Resource Management
HR Planning begins early in the project and may be performed iteratively.
Inputs
Enterprise Environmental Factors
Organizational Process Assets
Project Management Plan
Activity resource requirements
Tools
Organizational Charts and Position Descriptions
Three primary formats for organizational charting:
Hierarchical
Matrix - Responsibility Assignment Matrix RAM
RACI responsible, accountable, consult, inform
Text
Networking
Organizational Theory groups behave differently than individuals.
Expert judgment
Meetings
Outputs
HR management plan
Roles and Responsibilities
Project Org Charts
Staffing Management Plan how and when the project will be staffed.
HR
PG 3 Executing: Acquire Project Team
Gets the right people working on the project. Typically performed throughout the project as long
as the project is adding new staff.
Inputs
HR management plan
Roles and responsibilities position descriptions
Project org charts
Staffing management plan details when and how long resources will be
needed
Enterprise environmental factors
Organizational process assets
Tools
Pre-assignments assigning in advance
Negotiation acquiring from another team on the project
Acquisition looking outside the organization for resources that cannot be
provided internally

Virtual teams
Multi-criteria decision analysis availability, cost, expertise, etc
Outputs
Project staff assignments the primary output.
Resource calendars
PMP updates
HR
PG3 Executing: Develop Project Team
!!This is the most important process in Human Resource Management and is performed
throughout the project, but most effective when done early.
Inputs
Project staff assignments
HR management plan
Resource calendars
Tools
Interpersonal skills early project phases require more directing/leading; then
coaching, then facilitating, then supporting
Training any acquisition of skills that increases the ability to perform
Team-building activities
Tuckman Ladder (5 stages of team development. Forming, storming,
norming, performing, adjourning)
Ground rules
Co-location seating people next to each other
War room
Recognition and rewards focus on win-win
Personnel assessment tools
Outputs
Team performance assessments how is the team doing?
Enterprise environmental factors
HR
PG4 Monitor and Control: Manage Project Team
Inputs
Organizational process assets
Project staff assignments
Team performance assessments
Issue log
Work performance reports
HR management plan
Tools
Observation and conversation informal, used to monitor morale and identify
problems.
Project performance appraisals- appraisals for individual team members

Conflict management focus on constructive conflict management. Most conflict

often occurs between project managers and functional managers over schedules, priorities, and
resources
First, let the team work it out on their own

Conflict Resolution Modes

Conflict Mode

Description

Usually, the best way to resolve conflicts is to face the conflict directly with a coo
work through disagreements resulting in consensus and commitment.
Collaborate or Problem Solve

Results in a Win-Win outcome

At times, there is bargaining and searching for solutions that bring some partial o
parties in a dispute with a give and take attitude.
Compromise or Reconcile

Results in a Lose-Lose outcome

Sometimes you may de-emphasize or avoid areas of difference and emphasize a

relationships.
Smooth or Accommodate

Results in a Lose-Yield outcome

If you have the authority and have to settle conflicts quickly, you can also exert y
viewpoints of others.
Force or Direct

Results in a Win-Lose outcome

At times, when you do not have all the information or when things are getting out
from a potential disagreement.
Withdraw or Avoid

Results in a Lose-Leave outcome

Outputs
Change requests
PMP updates
Project documents updates
Enterprise environmental factors updates
Organizational process assets udpates

Communications Management (Ch 10)

The project managers most important skill set is that of communication.

CM
PG2 Planning: Plan Communications Management
!! All about the Communications Management Plan sole output of this process
Inputs
Enterprise environmental factors
Organizational process assets
PMP
Stakeholder register
Tools
Communications requirements analysis who needs what and how often
Communication theorists use a formula to express how
communications grow as people are added to the team: n(n-1)/2
So a team of 20 people has (20*19=380)/2=190 channels
But add 5 people and it goes up to 300 (25*24/2)
Make sure to add the PM in to the total team number
The specific number of communication channels is not in the
communications management plan
Communications technology should be tailored to the need
Communications models
Schematic to describe project communication
Communication methods know push v pull v interactive. Pull is sharepoint,
push is email
Meetings
Output
Communications management plan
Who should receive project communications
What communications should they receive
Who should send the communications
How often the communications will be sent
How often it will be updated
Definitions common understanding of terms

CM
PG3 Executing: Manage Communications
Inputs
Communications management plan
Work performance reports
Enterprise environmental factors
Organizational process assets
Tools
Communication technology

Communication models
Communication methods
Information management system
Performance reporting
Outputs
Project communications
PMP updates
Organizational process assets updates
Project documents updates
CM
PG4 Monitor and Control: Control Communications
How is the project doing against the plan?
Inputs
PMP
Project communications
Issue log
Work performance data - cost variance, schedule variance, CPI, SPI
Organizational process assets
Tools
Information management system
Expert judgment
Meetings
Outputs
Work performance information
Change requests
PMP updates
Project document updates
Org. process assets updates

Risk Management (Ch. 11)

Project Manager is in control and proactively managing events to avoid as many problems as
possible.
Risk is related to an uncertain event. It may affect the project for good (opportunities) or bad
(threats.)
Other risk terms
Contingency plan what to do when predefined events occur
Fallback plan - alternative
Residual risk remains after responses have been implemented
Secondary risk risk that arises as a direct result of a response

Six Risk Management processes across two process groups with primary output:
Planning:
Plan Risk Management risk management plan
Risk Identification risk register
Qualitative Risk Analysis risk register updates
Quantitative Risk Analysis risk register updates
Risk Response Planning - risk register updates
Monitor and Control: Risk Monitoring and Control risk register updates, change requests,
recommended corrective actions, recommended preventive actions
RM
PG 2 Planning: Plan Risk Management
Creates the Risk Management Plan. Takes place very early since it can influence decisions on
scope, time, cost, quality, procurement
Inputs:
PMP
Project charter
Stakeholder register
Organizational process assets
Enterprise environmental factors
Tools:
Analytical techniques- what is their risk attitude
Meetings meet with all appropriate stakeholders
Expert judgment
Outputs:
Risk management plan how risk management will be structured and performed
Methodology
Roles and responsibilities
Budgeting
Timing
Definitions of risk probability and impact
o Impact scale
Risk Breakdown Structure RBS breakdown categories (technical, project
management, organizational, external) of risks to be evaluated (not the actual
risk)
RM
PG2 Planning: Identify Risks
Inputs:
Risk management plan
Cost management plan
Schedule management plan
Quality management plan
Human resources management plan
Scope baseline
Activity cost estimates
Activity duration estimates

Stakeholder register
Project documents
Procurement documents
Enterprise environmental factors
Organizational process assets
Tools:
Documentation reviews
Information gathering techniques
Brainstorming
Delphi technique (think anonymous)
Interviewing
Root Cause Analysis
Checklist analysis using RBS
Assumptions analysis
Diagramming techniques
Ishikawa (fishbone, cause/effect)
Influence Diagrams
Flow charts graphical representations of complex process flow
SWOT strengths, weaknesses, opportunities, threats
Expert judgment
Outputs:
Risk register all identified risks, reactions, root causes, and categories
RM
PG2 Planning: Qualitative Risk Analysis
Think prioritization
Inputs:
Risk management plan
Scope baseline
Risk register
Organizational process assets
Enterprise environmental factors
Tools:
Risk probability and impact assessment
PIM Probability and Impact Matrix
Risk urgency assessment require immediate attention
Risk data quality analysis
Risk categorization
Expert judgment
Outputs:
Project document updates (risk register updates prioritized, categorized, trends,
watch-list (non critical risks to be monitored)
RM
PG2 Planning: Quantitative Risk Analysis

Think financial analysis

Inputs:
Risk management plan
Cost management plan
Schedule management plan
Risk register
Organizational process assets
Enterprise environmental factors
Tools:
Data gathering and representation techniques
Interviewing
Input to Monte Carlo
Quantitative risk analysis and modeling techniques
Sensitivity analysis (impact analysis)
Tornado diagrams ranked bar graph with expected monetary value that
forms a tornado shape
Expected monetary value analysis
Decision tree analysis
Modeling / Simulations Monte Carlo analysis
Expert judgment
Outputs:
Project document updates (risk register)
Prioritized list of quantified risks (may be a combination of all
techniques but especially sensitivity analysis)
Probability of achieving cost and time objectives via Monte Carlo or
contingency reserve planning
RM
PG2 Planning: Plan Risk Responses
Creating a detailed, actionable plan for managing identified risks
Inputs:
Risk management plan
Risk register
Tools:
Strategies for negative risks or threats
Avoid (for critical/high impact only)
Transfer (i.e. insurance, contractors - usually a cost associated)
Mitigate reduce the probability or impact or both. Most common
o i.e. offering incentives
Accept - may be the best strategy if cost or impact of other strategies is
too great or if its a watch type risk
o May include setting aside a contingency reserve
Strategies for positive risks or opportunities
Exploit taking advantage of positive risk
Enhance use root cause to increase likelihood
Share work with another party

 Accept recognizing but not pursuing

Contingent response strategies
I.e. disaster response
Expert judgment
Outputs:
PMP updates (schedule management plan, cost, etc)
Project document updates (risk owners, trigger conditions, budget and schedule)
Risk-related contractual agreements
RM
PG4 - Monitor and Control: Control Risks
There is no risk baseline so less trend analysis... here you implement your planned responses
Inputs:
PMP
Risk register
Work performance data to compare plan to results
Work performance reports focus on how work was done, not what was done
Tools:
Risk reassessment (you assess risks during planning AND control)
Risk audits similar to Lessons Learned
Variance and trend analysis
Variance difference between planned and executed (i.e. cost, schedule)
Trend how performance is trending
Technical performance measurement i.e. number of defects, lag time
Reserve (contingency) analysis
Status meetings
Outputs:
Work performance information contextualized data meant to communicate to
stakeholders for project decisions
Change requests made as a result of contingency plans or workarounds
PMP updates
Project document updates risk register
Organizational process assets updates
Procurement Management (Ch. 12)
Purchasing based on government purchases. Overriding idea is a fair bid. The
bidders/sellers/venders need to have equal access to information.
Procurement mgmt
PG2 Planning: Plan Procurement Management
Documenting project procurement decisions (which project needs can/should be met by third
parties), specifying the approach, and identifying potential sellers
Types of contracts
Fixed-price contracts
o Firm fixed price (FFP) risk is on the seller

Fixed price incentive fee (FPIF)

Point of total assumption
o Fixed price with economic adjustment (FP-EPA)
Cost-reimbursable
o Cost plus fixed fee (CPFF)
o Cost plus incentive fee (CPIF)
o Cost plus award fee (CPAF)
Time and material (T&M)
o

Inputs:
PMP
Requirements documentation
Risk register
Activity resource requirements
Project schedule
Activity cost estimates
Stakeholder register
Enterprise environmental factors
Organizational process assets
Tools:
Make-or-buy analysis
Avoid (for critical/high impact only)
o
Expert judgment
Market research
Meetings
Outputs:
Procurement management plan
Procurement statement of work
Procurement documents
Source selection criteria
Make-or-buy decisions
Change requests
Project documents updates
Procurement management
PG3 Executing: Conduct Procurements
Obtain seller responses, select a seller, award a contract.
Inputs:
Procurement management plan
Procurement documents
Source selection criteria
Seller proposals
Project documents
Make-or-buy decisions
Procurement statement of work
Organizational process assets

Tools:
Bidder conference particularly for gov purchases
Proposal evaluation techniques
Independent estimates
Expert judgment
Advertising
Analytical techniques i.e. examination of seller past performance
Procurement negotiations
Outputs:
Selected seller(s)
Agreements (contracts)
Resource calendars
Change requests
PMP updates
Project documents updates
Procurement management
PG4 Monitoring and Controlling: Control Procurements
Obtain seller responses, select a seller, and award a contract.
Inputs:
Procurement management plan
Procurement documents
Agreements
Approved change requests
Work performance information
Work performance data
Tools:
Contract change control system
Procurement performance reviews
Inspections and audits
Performance reporting
Payment systems
Claims administration
Records management system maintained by project manager
Outputs:
Work performance information
Change requests
PMP updates
Project documents updates
Organizational process asset updates
Procurement management
PG5 Closing: Close Procurements completing procurement
Inputs:
Procurement management plan

Procurement documents
Tools:
Procurement audits
Procurement negotiations
Records management system maintained by project manager
Outputs:
Closed procurements
Organizational process asset updates
Stakeholder Management (Ch. 13)
PG1- Initiating Identify Stakeholders. Think power/interest grid
Inputs:
Project Charter
Procurement documents (RFI, RFP, RFQ)
Enterprise environmental factors
Organizational process assets
Tools:
Stakeholder analysis power/interest, power/influence, salience model (venn
diagram)
Expert judgment
Meetings
Output:
Stakeholder register details related to stakeholders such as:
Identification information
Assessment info (requirements, expectations, influence)
Classification (internal/external, resistor)
Stakeholder Management (Ch. 13)
PG1- Planning Plan Stakeholder Management
Inputs:
PMP
Stakeholder register
Enterprise environmental factors
Organizational process assets
Tools:
Expert judgment
Meetings
Analytical techniques Stakeholders engagement assessment matrix determine
stakeholder engagement levels in order to get them to the desired level. Levels: unaware,
resistant, neutral, supportive, or leading
Output:
Stakeholder management plan

Overlaps with communications management plan. Includes:

o Desired and current engagement levels
o Interrelationships
o Stakeholder communication requirements
o Time frame and frequency of distribution of information
Project documents updates schedule, stakeholder register
PG3 Executing: Manage Stakeholder Engagement
Communicating and working with stakeholders in order to meet expectations
Inputs
Stakeholder management plan
Communications management plan
Change log (because stakeholders must be informed of changes)
Organizational process assets
Tools
Communications methods Face-to-Face are best where stakeholder issues are
concerned
Interpersonal skills trust-building, conflict resolution, active listening
Management skills facilitation, influence, and negotiation
Outputs
Issue log
Change requests
PMP updates
Project document updates
Organizational process assets updates
Stakeholder Management
PG4 Monitor and Control: Control Stakeholder Engagement
Monitoring overall relationships and adjusting strategies as needed
Inputs
PMP
Issue log
Work performance data
Project documents
Tools
Information management system
Expert judgment
Meetings
Outputs
Work performance information status of deliverables, forecasts
Change requests corrective and preventative actions
PMP updates any of the management plans
Project document updates stakeholder register and issue log
Organizational process assets updates