PMP Exam Preparation

Points to Remember-2
9 ProjectSelectionMethods:
1BenefitMeasurementMethods:a.EconomicModels,b.ScoringModels,c.ComparativeApproach,d.
BenefitContribution,ande.MurderBoard
2ConstrainedOptimizationMethods:a.Linear,b.NonLinear,c.Dynamic,d.Integer,ande.Multi
objectivealgorithms
9 EconomicValueAdd(EVA):Ifaprojectdoesnotmakemoremoneythantheopportunitycosts,ithasnottruly
addedeconomicvaluetotheorganization.
9 InternalRateofReturn(IRR):Biggerisbetter.
9 OpportunityCost:'whatisthecostoftheotheropportunitieswemissedbyinvestingourmoneyinthis
project?
9 PaybackPeriod:ashorterpaybackperiodisbetter.
9 ReturnonInvestment(ROI):Biggerisbetter.
9 CorrectiveandPreventiveActionsdonotnormallyaffecttheProjectBaselines,onlytheperformanceagainst
thebaselines.
9 MidProjectEvaluationsareconductedwhileprojectworkisstillinprogress.Themainpurposeofsuch
evaluationsistodetermineifobjectivesarestillrelevantandiftheseobjectivesarebeingmet.
9 PerformIntegratedChangeControlisprimarilyfocusedonMANAGINGCHANGEstotheproject'sSCOPE.
9 MonitorandControlProjectWorkisprimarilyfocusedonMANAGINGTHEWAYthatSCOPEisexecuted.
9 CCBisresponsibleforreviewingchanges&changerequestsanditslevelofauthorityshouldbespelledoutin
theProjectManagementPlan.
9 Changecontrolisfocusedonidentifying,documentingandcontrollingchangestotheprojectandtheproduct
baselines.
9 VerifyScopehappensattheendofeachphase/project,andupondeliveryofProduct/Service/Result.
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9 VerifyScopeisconcernedwithcompletenessandacceptance.
9 PerformQualityControlisconcernedwithcorrectness.
9 Customer'sinterestsshouldalwaysbeweighedheavilyanddisputesshouldberesolvedinfavorofthe
customer.
9 ABaseline(whetherforScope,Schedule,Cost,orQuality)istheOriginalPlan+AllApprovedChanges.
9 ScopeCreepResultsfrom:
o

Poorinitialrequirementsdefinition.

Failuretoinvolveusersinearlystages.

AmissingScopeBaseline.

PoorChangeControl.

WeakManagement.

Failuretomanageuserexpectations.

9 MandatoryPredecessorsareknownas(Hardlogic),DiscretionaryPredecessorsareknownas(Preferredlogic,
orSoftlogic).
9 ResourceCalendarsspecifyWHENandHOWLONGidentifiedprojectresourcewillbeavailableduringthe
project.
9 ScheduleCompressionincludesFasttrackingandcrashing.
9 Crashingusuallyincreasescost.OverTimeisconsideredasCrashing.CheapestTaskhastobecrashedfirst.
9 Heuristics:Rulesforwhichnoformulaexists.Usuallyderivedthroughtrialanderror.
9 FreeFloat:howmuchtimeanactivitycanbedelayedwithoutaffectingtheearlystartdateofsubsequent
dependentactivities.
9 ResourceLevelingcanbeusedwhensharedorcriticalrequiredresourcesareonlyavailableatcertaintimes,or
availableinlimitedquantities,ortokeepresourceusageataconstantlevel.Itcanoftencausetheoriginal
criticalpathtochange.

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9 PathConvergence:Themergingorjoiningparallelschedulenetworkpathsintothesamenodeinaproject
schedulenetworkdiagram.
9 PathDivergenceisextendingorgeneratingparallelschedulenetworkpathsfromthesamenodeinaproject
schedulenetworkdiagram.
9 CostofqualityistheCostthatisincurredtoachieverequiredquality.
9 Stranded/SunkCostsareuncuredcoststhatcannotbereversedirrespectivetofutureevents.
9 LifeCycleCostingincludesAcquisition,Operation,Maintenance,andDisposalCosts.
9 Benchmarkingmeansusingtheresultsofqualityplanningonotherprojectstosetgoalsforyourown.
9 Designofexperimentsisthelistofallthekindsoftestsyouaregoingtorunonyourproduct.
9 AttributeSamplingisbinary,iteitherconformstoqualityoritdoesnt(YESorNO).
9 VariableSamplingmeasureshowwellsomethingconformstoquality(RANGES).
9 SpecialCausesconsideredunusualandpreventablebyprocessimprovement.
9 CommonCausesaregenerallyacceptable.
9 Tolerancesdealwiththelimitsyourprojecthassetforproductacceptance.
9 ControlLimitsaresetatthreestandarddeviationsaboveandbelowthemean.Aslongasyourresultsfall
within
9 CauseandEffectDiagram(Ishikawa/Fishbone):Usedtoshowhowdifferentfactorsrelatetogetherandmight
betiedtopotentialproblems.ItimproversqualitybyidentifyingqualityproblemsandtryingtoUNCOVERTHE
UNDERLYINGCAUSE.
9 FlowChartshowshowprocessesinterrelate.
9 Histogram(ColumnChart)itshowshowoftensomethingoccurs,oritsfrequency(noRanking).
9 ParetoCharts(8020rule):ThisisaHistogramshowingdefectsRANKEDfromGREATESTtoLEAST.Thisrule
statesthat80%oftheproblemscomefrom20%ofthecauses.
9 RunCharttellsaboutTRENDSintheproject.Showsthehistoryandpattern.

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9 ScatterDiagramisapowerfultoolforSPOTTINGTRENDSinData.ScatterDiagramsaremadeusingtwo
variables(adependentvariableandanindependentvariable).
9 StatisticalSamplingisapowerfultoolwhereaRANDOMsampleisselectedinsteadofmeasuringtheentire
population.
9 Qualityis"thedegreetowhichasetofinherentcharacteristicsfulfillrequirements."
9 TotalQualityManagement(TQM):Everyoneinthecompanyisresponsibleforqualityandisabletomakea
differenceintheultimatequalityoftheproduct.TQMshiftstheprimaryqualityfocusawayfromtheproduct
thatisproducedandlooksinsteadattheunderlyingprocessofhowitwasproduced.
9 ContinuousImprovementProcess(CIP)/KAIZEN:Aphilosophythatstressesconstantprocessimprovement,in
theformofsmallchangesinproductsorservices.
9 JustInTime(JIT)isamanufacturingmethodthatbringsinventorydowntoZero(ornearZero)levels.Itforces
afocusonquality,sincethereisnoexcessinventoryonhandtowaste.
9 StatisticalIndependence:Whentheoutcomesoftwoprocessesarenotlinkedtogetherordependentupon
eachother,theyarestatisticallyindependent.
9 Kindsofpowers:Rewardpower,Expertpower,Referentpower,Punishmentpower(Coercive),andlegitimate
power(Formalpower).RewardandExpertasthemosteffectiveformsofpowerandPunishment/Coerciveas
theleasteffective.
9 RecognitionandReward(TheoriesofMotivation):Winwinrewardsasthebestchoicesforteambuilding.
9 Maslowshierarchyofneeds:Youcantachievehigherneedsuntilyouresatisfiedwiththelowerones.
>>>>1.Physiological,2.Security,3.Acceptance.HigherNeeds4.Esteem,5.SelfActualization.
9 HerzbergsMotivationHygieneTheory:Hygienefactors(CompanyPolicy,Supervision,Goodrelationshipwith
boss,workingconditions,Paycheck,Personallife,Status,Security,andRelationshipwithcoworkers)doesnot
makesomeonesatisfied,buttheirabsencewillmakesomeoneunsatisfied.Hygienefactorsdonotmotivateby
themselves.Motivationfactors(Achievement,Recognition,Work,Responsibility,Advancement,andGrowth)
willmotivate,buttheywillnotworkwithouttheHygienefactorsinplace.

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9 DouglasMcGregorsTheoryXandTheoryY:TheoryXTeammembersareSelfish,Unmotivated,Dislikework
(constantsupervisionisrequired'authoritarianmanagement'style).TheoryYNaturallymotivatedtodo
goodwork(managertruststeammembers'participativemanagement'style).
9 ExpectancyTheory:Ifworkersbelievetheireffortsaregoingtobesuccessfulandrewarded,theywilltendto
behighlymotivatedandproductive.
9 GroundRules:Formalorinformalrulesthatdefinetheboundariesofbehaviorontheproject.
9 StagesofTeamDevelopment:1.Forming,2.Storming,3.Norming,4.Performing,and5.Adjourning
9 FormalVerbal(PresentationsandSpeeches)
9 InformalVerbal(Meetings,Conversations)
9 FormalWritten(ProjectPlans,Contract,Charter)
9 InformalWritten(StatusUpdates,memos,Email)
9 90%oftheProjectManager'stimeisspentcommunicating
9 SensitivityAnalysis(TornadoDiagramshowsHOWSENSITIVEeachanalyzedareaoftheprojectistorisk.It
ranksthebarsfromGREATESTtoLEASTontheprojectsothatthecharttakesonaTornadolikeshape).
9 BuyersRisk(fromHighesttoLowest)CPFFT&MCPIFFPIFFFP
9 IFBorRFB/Pusedfor1.SinglePrice,2.High$Value
9 RFQusedfor1.PerItem/HourPrice,2.Lower$Value,3.MaybeusedtodevelopinfoinRFP.
9 BuyersRisk(fromHighesttoLowest):CPFFT&MCPIFFPIFFFP
9 Aprojectbaselineservesasacontroltool.Projectplanexecutionandworkresultsaremeasuredagainsttheproject
baselines.
9 Theprojectplanservesasaguidetoallfutureprojectdecisions.
9 IntegratedChangeControlisasystemtodocumentchanges,theirimpact,responsetochanges,andperformancedeficits.
9 Configurationmanagementinvolvesmakingsurethateveryoneisworkingoffthesamedocumentsandversion.
9 Onlywithformalacceptancecantheprojectmanagerbesuretheprojectworkisreallycomplete.
9 TheprojectwiththehighestNPVisthebestone.
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9 Constrainedoptimizationusesmathematicalmodels.
9 Linearprogrammingisamathematicalmodel.
9 ThelargertheBCR,SPIandCPIthebetter.
9 Itisbettertocapturedataattheendofeachphaseofaproject.Donotwaituntiltheend.
9 Aworkauthorizationsystemisusedtocoordinatewhenandinwhatordertheworkisperformed.
9 ApprovedChangeswillleadtochangestothebaseline.
9 Itisthesponsor'sroletodetermineobjectives.Theseobjectivesaredescribedintheprojectcharter.
9 Thelessonslearnedareprojectmanagementdeliverables.
9 Thearchiveisthelastthingtocreatebeforereleasingtheteam.
9 Scopeverificationfocusesoncustomeracceptanceofadeliverable
9 Productverificationisfocusedonmakingsurealltheworkiscompletedsatisfactorily.
9 Theprojectmanagerisalsoanintegrator,andacommunicator.
9 Thescopestatementservesasapointofreferenceforallfutureprojectdecisions.
9 ThescopebaselineincludestheWBS,WBSdictionary,andprojectscopestatement.
9 Ateammembershouldhaveflexibilityattheworkpackageleveltomakesomechangesaslongastheyarewithinthe
overallscopeoftheWBSdictionary.
9 WorkthatisnotintheWBSisoutsidethescopeoftheproject.
9 Levelingresourcesgenerallyextendstheschedule.
9 Correctiveactionisanythingdonetobringexpectedfuturescheduleperformanceinlinewiththeprojectmanagement
plan.
9 Qualityattributesarethemeasurementsthatdetermineiftheproductisacceptable.Theyarebasedonthe
characteristicsoftheproductforwhichtheyweredesigned.
9 PerformQualityAssuranceinvolvesdeterminingwhetherstandardsarebeingfollowed.

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9 Datapointsoutsidethecontrollimitsindicatetheprocessisoutofcontrol,andproductionshouldbestoppeduntila
solutionisfound.
9 Inspectionsmaybeconductedatanylevelincludingtheprojectteam,andatanytimethroughouttheproduct
development.Theyareusedtopreventdefectsfrombeingdeliveredtothecustomer.
9 Trendanalysisexaminesprojectresultsovertimetoevaluateperformance.
9 Thecontrollimitsaresetbasedonthecompany'squalitystandardandindicatetheacceptablerange.
9 Thehaloeffectistheassumptionthatbecausethepersonisgoodatatechnologytheydalsobegoodatmanaginga
project.(Whichisawrongassumption).
9 Confrontingmeansproblemsolvingandproblemsolvingisthebestwaytoresolveconflict.
9 StaffingManagementPlan:WHENandHOWresourcewillbeADDEDandTAKENOFFtheteam.
9 Acornerofficeisa"perk"whereashealthbenefitsareafringebenefit.
9 Thefinalstepsofproblemsolvinginclude:implementadecision,reviewit,andconfirmthatthedecisionsolvedthe
problem.
9 Acommunicationmatrixisanexcellenttooltoidentifythestakeholdersandtheirrequirementsforcommunication.
9 ReportPerformanceisamonitoringandcontrollingprocess.
9 Nonverbalcommunicationcarries55%ofthemessage.
9 ProgressReportsgenerallyshowproblemsaftertheyhaveoccurred.
9 Anerrorvalueofsevenpercentrepresentsthethresholdtheprojectisallowedtooperateunder.
9 Whenthescopehasbeenchanged,theprojectmanagershouldrequireriskplanningtoanalyzetheadditionsforrisksto
theprojectsuccess.
9 MonteCarlosimulationscanrevealmultiplescenariosandexaminetherisksandprobabilityofimpact.ItisaComputer
basedAnalysis&usefulforrevealingScheduleRisks
9 Adecisiontreeallowsyoutomakeaninformeddecisiontodaybasedonprobabilityandimpactanalysis.Youcandecide
basedontheexpectedmonetaryvalueofeachofyouroptions.

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9 Ariskratingmatrixisdevelopedbyadepartmentoracompanytoprovideastandardmethodforevaluatingrisks.This
improvesthequalityoftheratingforallprojects.AriskratingmatrixiscreatedduringthePerformQualitativeRisk
Analysisprocess.
9 Theriskresponseownerisassignedtocarryoutresponsesandmustkeeptheprojectmanagerinformedofanychanges.
9 Afaircontractsharesareasonableamountofriskbetweenthebuyerandtheseller
9 AnSOWcanbeacontractifbothpartiesagreetotheSOWandsignthedocumentasacontract.
9 Asinglesourcesellermeansthereisonlyonesellerthecompanywantstodobusinesswith.
9 AnIFBistypicallyarequestforasealeddocumentthatliststhesellersfirmpricetocompletethedetailedwork.
9 WedecomposetheProjectusingaWBS.
9 Theprojectmanagershouldattendthebidderconference.
9 Asellercannotissueachangeorder(althoughhecouldrequestone).
9 Specialprovisionstakeprecedenceovergeneralprovisions.
9 Theonlywaytochangethecostplusfixedfeecontractistonegotiateachangetothecontract,normallyintheformof
changeorders.Changeordersshouldincludeanadditionalfeeifadditionalworkisaddedtothecontract.
9 Aprocurementauditincludeswhatwentrightandwrongforthepurposesofcreatinghistoricalrecordsandimproving
futureperformance.
9 Whenyoumustbeginworkimmediatelywithoutaprocurementstatementofwork,themostappropriatechoiceisT&M.
9 Theindependentestimateismostconcernedwithcost,comparingcostestimateswithinhouseestimates,orwithoutside
assistance.
9 Aletterofintentisnotbindinginacourtoflaw,itdoesmakethesellerfeelmorecomfortableaboutexpendingfunds
beforeacontractissigned.
9 Generallyinprocurementsituations,achangecontrolboardmightreviewandapproveorrejectachange,butonlythe
procurementmanagerhastheauthoritytosignachange.
9 Incentivesaremeanttobringtheobjectivesofthesellerinlinewiththoseofthebuyer.Thatwaybothareprogressing
towardthesameobjective.

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9 Professionalandsocialresponsibilityrequirestheinvestigationofanyinstancewherethelegitimateinterestsofthe
customermaybecompromised.Ifsuchacompromiseisfound,actionmustbetaken.
9 Wheneveryouareuncertainofwhetherapaymentisabribe,youshoulddiscussthesituationwithlegalcounsel.
9 Theprojectmanager'sresponsibilityistoprovidetruthfulprojectinformation.Heorsheshouldthereafterdiscussthe
impactsoftheiractionswiththeteammembers.Ifthatdoesnotwork,thenextstepistoreportittotheirfunctional
managers.
9 TheProjectManagershouldalwaysbeasEXPLICIT,DIRECT,andUNAMBIGUOUSaspossiblegiventheculturalconditions.
9 All10Monitoring&ControllingProcesseshaveChangeRequestsasanoutput.
9 RequirementsCategories:1.ProductRequirements(TechnicalSpecifications);2.ProjectRequirements(Operational
Specifications)
9 ProjectMurderBoardisdefinedasapanelofpeoplewhotrytoshootdownanewprojectidea.
9 ManagementByWalkingArounddonebyObservationandConversation
9 QualityBenefitsmustoutweightheCost.
9 Prevention:Keepingerrorsoutoftheprocess.
9 Inspection:Keepingerrorsoutofthehandsofthecustomer
9 LeadsandlagsareAPPLIEDaspartoftheDevelopScheduleprocess,butthentheyareADJUSTEDintheprocessofControl
Schedule.
9 Asuccessfulprojectmanagerwilllearntheartofdelegationwhattodelegatetoothersandwhattonotdelegate.
9 TheBudgetatCompletion(BAC)andPlannedValue(PV)canbothbecalculatedbeforeworkbegins.
9 TheissuelogisatoolusedinManageProjectTeamintheHumanResourceManagementknowledgearea.
9 MutuallyExclusiveiswhentwoeventscannotbothhappenatthesametime.
9 Adocumentmanagementsystemisaconfigurationmanagementtool,usefulintheprojectmanagementinformation
system.ConfigurationinformationinparticularwillassistwiththetoolofVarianceAnalysisintheprocessofControl
Scope.

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