Scope definition is defined by PMI as ''decomposing the major deliverables into smaller, more manageable components to provide better control.''
The chart of accounts is the system used to monitor project costs as defined by PMI.
A stakeholder is an individual or organization that is involved in or may be affected by project activities.
The actual payback period is between two years and three years. It is the point where the net or cumulative cash flows equal zero. This occurs between year 2 and 3 and is 2 and 29/30 of a year from the first cash flow. Cumulative cash flow in years are: 1, —500,000; 2, -290,000; 3, + 10,000.
The net cash flow is the total of all the cash flows in and out of the company caused by the project. In this example 850,000 in and 900,000 out for a negative 50,000.
Calculating the net present value of the cash flows for the project involves adjusting the future cash flows to allow for diminishing value due to the time that we must wait to get them. Money received today is more valuable to us than money that is received in the future.
From the Guide to the PMBOK 2000: ''Program. A group of related projects managed in a coordinated way. Programs usually include an element of ongoing activity.''
Most of the project money will be spent during the execution phase. At the beginning of execution the rate of expenditures rises as people and materials are brought into the project.
Later the expenditures peak and slow down. By the end of the execution phase expenditures are approaching a minimum.
From the Guide to the PMBOK2000: ''Project. A temporary endeavor undertaken to create a new product or service.''
A statement of work is the description of what the project is about and what will be delivered. The project plan is complete and contains the detailed work that the project will do, complete with task descriptions and schedule, cost, and scope baselines containing a real schedule and budget. An exception report describes items that are not as planned and a Pareto analysis is a quality management tool used to prioritize defects according to those most frequently occurring.
Verifying scope is the process of verifying that the project made or delivered is what was asked for.
In management by objectives, the employee and supervisor meet to discuss the objectives of the employee over the next review period. At the end of the review period the performance of the employee is reviewed relative to the objectives, and adjustments are made. This is generally considered a good approach for project managers to use when managing the project team. In many cases the review period is as little as two weeks.
Configuration management is the process of making sure that the product meets the design criteria in terms of form, fit, and function.
The project charter is one of the first things that must be done in any project. The project charter according to the Guide to the PMBOK2000 is: ''A document issued by senior management that provides the project manager with the authority to apply organizational resources to project activities.''
In the work breakdown structure the lowest level of breakdown is the work package. This does not mean that work cannot be divided any further. Work packages are usually broken down into tasks, and tasks can be further broken down into activities. The point here is that the project manager is concerned about things down to the work package level. In a relatively large project the project manager would have subproject managers or work package managers who would further breakdown the work in their own work breakdown structures.
The current project baseline for scope includes the original scope of the project plus or minus any scope changes that have taken place since the baseline for scope was established.
A project charter is a document that formally recognizes the existence of a project. It should include, either directly or by reference to other documents, the business need that the project was undertaken to address and the product description.
The work breakdown structure represents all the work that must be done in order to complete the project. Doing all the work will deliver all the tangible results to the client. In most projects there will also be deliverables that will be delivered to other stakeholders. Work that is done by contractors and those not on the project team is included in the WBS. The lowest level of the WBS is the work package (according to PMI). Work packages can be broken down into tasks, and tasks can be broken down into activities.
A program manager is a manager who manages a group of related projects in a coordinated way.
A work breakdown structure is a deliverable-oriented grouping of project elements that organizes and defines the total scope of the project: Work not in the WBS is outside the scope of the project. Although the WBS can and is used for many other project-related things, the best answer is b, since it is the most comprehensive answer.
The execution phase of projects will nearly always cost the bulk of the project budget. This is because there are more people working on the project, and they are spending more money than at other times.
Progress reports should be used even on the smallest of projects. They allow all of the stakeholders to judge the performance and progress of the project according to the project plan.
It is not necessary to use the earned value reporting system. The overhead of using a formal reporting system may not be justified on very small projects. Reporting may frequently be delegated to someone on the project team or even a member of the project management support office.
This is the definition of a project.
The project charter is the first document to be created in the project. It gives the project manager the authority to manage the project. It will frequently contain a business case and a set of goals and objectives for the project as well.
Balance is the strength or weakness of the project manager to have authority over the people who actually do the work in the project. In the projectized organization the project manager has complete authority over the people on the project team. In the strong matrix organization the project manager has more influence over the people on the project team than the functional manager. In the weak matrix organization the functional manager has more authority to direct the project team members than the project manager. In a balanced matrix organization the project manager and the functional manager are at about the same authority level.
In order for the project to have a 5% probability of being late, there is a 95% probability that the project will be delivered on time or earlier. In terms of the PERT calculation this means that 2 standard deviations should be added to the expected value date of May 30. Since there is a one month difference between the 95% promise date of June 30 and the expected value of May 30, the standard deviation must be one-half month. This is a better answer than fifteen days because on the basis of a five-day workweek this is close to three weeks.
The request for and agreement to a specific date for completion of a particular milestone in the project is called a constraint. Constraints for project tasks and activities that do not put them on the critical path are not necessarily a problem as long as delays in the schedule do not ultimately place them on the critical path. Some process constraints may be predefined as constraints. For example, management may specify a target completion date rather than allowing it to be determined by the planning process. Constraints are factors that will limit the project management team's options. For example, a predefined budget is a constraint that is highly likely to limit the team's options regarding scope, staffing, and schedule.
The current budget of the project contains all of the authorized funding for the project including additions to the project since the setting of the original baselines. This includes any and all authorized work done on the project, including the investigation of work that may be done to investigate the feasibility of changes.
The project manager will normally break the WBS down to the work package level. Work packages can be broken down further into tasks and activities.
It is generally accepted that for most projects, once a project's definitive estimate has been completed, the actual project cost will be not more than 5% below the definitive estimate and not more than 10% above it.
The change management plan is generally a document or procedure that is normally found in the scope management plan.
The client should pay, because the signing of the WBS constituted an agreement between the company managing the project and the client. Work that is not specified in the WBS is not part of the project scope. In reality this is sometimes not the case. Companies will frequently do work that is outside of the project scope as defined by the WBS in order to ensure the goodwill of the client.
The calculation for net present value is based on the compound interest formula. FV = PV ( 1 + r )■>
Where FV is future value and PV is present value. Solving this for the present value gives:
Note that all the negative cash flows occur at the beginning of the year when the machine is purchased and that the positive cash flows all occur at the end of one year.
The precedence network diagramming tool is used because it best shows the logical relationships between the activities in the schedule. The Gantt chart shows the project schedule graphically indicating the start and finish for each activity. The milestone chart shows the start or completion for specific groups of activities on a summarized chart.
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What you need to know about… Project Management Made Easy! Project management consists of more than just a large building project and can encompass small projects as well. No matter what the size of your project, you need to have some sort of project management. How you manage your project has everything to do with its outcome.