The-PRINCE2-Training-Manual.pdf

1. 1. The PRINCE2® Training Manual A common sense approach to learning and understanding PRINCE2 Version 1.0h (Check latest version) Buy a copy Covers the PRINCE2 Practitioner syllabus Link to PRINCE2 Foundation Self Study guide Link to PRINCE2 Practitioner Self Study guide PRINCE2 ATO: By Frank Turley, The PRINCE2 Coach MgmtPlaza – Affiliate of TAG MgmtPlaza The Swirl logo™ is a Trade Mark of the Office of Government Commerce PRINCE2 ® is a Registered Trade Mark of the Office of Government Commerce in the United Kingdom and other countries Practitioner Level
2. 2. The PRINCE2® Training Manual ii TAG.net MgmtPlaza PRINCE2® Audio Course The PRINCE2® Training Manual Thank you for reading our PRINCE2 Training Manual. The main objective of this book is to provide an easy-to-read and easy-to-understand PRINCE2 ® manual. The idea for this book came from the questions I received from people trying to learn PRINCE2 and after reading the official PRINCE2 manual “Managing Successful Projects with PRINCE2”. The official PRINCE2 Manual for the Project Manager is an excellent reference manual but can be rather difficult to pick up and read if you are new to both project management and PRINCE2. So this book is meant to be – and is – an easy introduction to PRINCE2 and is quickly becoming the most read book for people wishing to learn about PRINCE2 and prepare for Foundation Exam and Practitioner Exam. Feedback: We welcome any feedback (suggests to improve or corrections), see next page for my email address. The Swirl logo™ is a Trademark of the Office of Government Commerce PRINCE2 ® is a Registered Trademark of the Office of Government Commerce in the United Kingdom and other countries Evaluate / Buy this book You are very welcome to evaluate this book and if you find the book useful, we would appreciate if you would buy a copy. The cost of this PRINCE2 Training Manual is just: €24.00, $29, £19, see our shop. Free PRINCE2Self Study Course We offer a free full Self Study course if you but your official PRINCE2 Exam from us. Our Self- Study course includes, Audio Course, Books, 550 Q&A course, Practice Exams, etc… • Link to PRINCE2 Foundation Self Study guide: • Link to PRINCE2 Practitioner Self Study guide: • Link to Exam Purchase Page Acknowledgements Written Frank Turley Copyright © 2010 Frank Turley Expert Reviewer Peter Krischel LinkedIn Expert Reviewer Danny Vandeweyer LinkedIn Thanks also to the follow people for their feedback on this book: Cesar Lopez, Dimitri De Ruelle, Eralp Tezcan, Laurent George,
3. 3. The PRINCE2® Training Manual iii TAG.net MgmtPlaza PRINCE2® Audio Course Distribution Copyright Copyright © by Frank Turley All rights reserved. With the exception of brief passages and quotes for reviewing or commenting purposes, no part of this publication may be reproduced or transmitted in any form or by any means without prior consent of the author. Of course, I will consider any suggestions that you may have. About the Author Frank Turley (The PRINCE2 Coach) has been a Project Manager for more than 15 years and a PRINCE2 Practitioner. He is also a Project Manager trainer and coach and has written the following training material for PRINCE2: • Introduction to PRINCE2 CBT & Podcast The CBT and Audio course are based on the Introduction to PRINCE2 book (the most read book on PRINCE2). This introduction course is used by persons who are preparing for a classroom training or who wish to refresh their PRINCE2 knowledge. Link • PRINCE2 Audio Course This is the first PRINCE2 Foundation Audio Course that allows you to learn PRINCE2 while driving, walking, or gardening. This training stands out, as all new PRINCE2 terms are explained with examples, thus making it very easy to understand and take in. Link • Learn PRINCE2 Thru Questions Podcast (LTQ) This LTQ course provides more than 550 questions on PRINCE2 in an audio format to allow you to check your knowledge and learn about PRINCE2 at the same time. Link You can contact Frank at: E-mail : frank.turley@MgmtPlaza.com LinkedIn : www.linkedin.com/in/frankturley About TAG Trans-Atlantic Consulting Group (hereinafter, “TAG”) was established in 2001 by Peter Krischel. Since 2001, TAG has grown to be a global provider of PRINCE2 Project Management training and consulting services with training and consulting partners around the world. We have trained over 8,000 project managers in more than 20 countries using a global network of business partners. Trans-Atlantic Consulting Group is an accredited PRINCE2 training organization (ATO). PRINCE2 is a process-based approach for project management, providing an easily tailored and scalable method for the management of all types of projects. This method is the de facto standard for project management in the UK and is also practiced worldwide. About MgmtPlaza MgmtPlaza is a registered PRINCE2 affiliate of Trans-Atlantic Group and is managed by Frank Turley. Our mission is to make it easy for people to learn and use PRINCE2. We just focus on providing the following • An easy to use PRINCE2 Self-Study • Public and in-house PRINCE2 training • PRINCE2 coaching services/workshops to Project Managers, Senior Managers, etc…
4. 4. The PRINCE2® Training Manual iv TAG.net MgmtPlaza PRINCE2® Audio Course Table of Contents The PRINCE2 ® Training Manual ....................................................................................................ii Evaluate / Buy this book.................................................................................................................ii Free PRINCE2Self Study Course ..................................................................................................ii Acknowledgements ........................................................................................................................ii Distribution Copyright....................................................................................................................iii About the Author ...........................................................................................................................iii About TAG.....................................................................................................................................iii About MgmtPlaza..........................................................................................................................iii 1 Introduction – PRINCE2 ....................................................................................................... 1 1.1 The PRINCE2 Manual ................................................................................................... 1 1.2 What are Projects? ........................................................................................................ 1 1.3 Why a Project Management Method? ........................................................................... 2 1.4 What is PRINCE2? ........................................................................................................ 2 1.5 Six variables / six performance targets.......................................................................... 3 1.6 PRINCE2 Structure........................................................................................................ 3 1.7 What does PRINCE2 not cover? ................................................................................... 4 1.8 Benefits of using PRINCE2:........................................................................................... 4 1.9 What does a Project Manager do? ................................................................................ 5 1.10 Learn Thru Questions ............................................................................................... 6 2 The Process Model and Project Timeline............................................................................. 8 2.1 The PRINCE2 Process Model ....................................................................................... 8 2.2 Project Timeline ............................................................................................................. 9 2.2.1 Starting Up a Project ......................................................................................... 10 2.2.2 Initiating a Project Process / Initiation Stage..................................................... 11 2.2.3 Controlling a Stage – 1 st delivery stage............................................................. 12 2.2.4 Next delivery stages .......................................................................................... 13 2.2.5 Last delivery stage and Closing a Project ......................................................... 14 2.2.6 Exception Plan example .................................................................................... 15 2.2.7 Timeline Summary............................................................................................. 15 3 Principles ............................................................................................................................ 16 3.1 Introduction to principles.............................................................................................. 16 3.2 Principles: Continued Business Justification ............................................................... 16 3.3 Principles: Learn from Experience............................................................................... 16 3.4 Principles: Defined Roles and Responsibilities ........................................................... 17 3.5 Principles: Manage By Stages..................................................................................... 17 3.6 Principles: Manage by Exception................................................................................. 17 3.7 Principles: Focus on Products ..................................................................................... 18 3.8 Principles: Tailoring or Tailor to suit the Project Environment..................................... 18
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The PRINCE2® Training Manual v TAG.net MgmtPlaza PRINCE2® Audio Course 3.9 Learn Thru Questions .................................................................................................. 19 4 Themes Introduction........................................................................................................... 21 4.1 Introduction to Themes ................................................................................................ 21 4.2 List of Themes ............................................................................................................. 21 4.2.1 Theme: Business Case ..................................................................................... 21 4.2.2 Theme: Organization ......................................................................................... 22 4.2.3 Theme: Quality .................................................................................................. 22 4.2.4 Theme: Plans..................................................................................................... 23 4.2.5 Theme: Risk....................................................................................................... 23 4.2.6 Theme: Change................................................................................................. 23 4.2.7 Theme: Progress ............................................................................................... 24 4.3 Learn Thru Questions .................................................................................................. 24 5 Business Case Theme ....................................................................................................... 26 5.1 Introduction to Business Case Knowledge .................................................................. 26 5.2 What happens in the real world? ................................................................................. 26 5.3 The Business Case knowledge provided by PRINCE2............................................... 26 5.4 What does a Business Case do for the project? ......................................................... 27 5.5 How to best describe what you get from a project?..................................................... 27 5.6 Different types of Business Case................................................................................. 28 5.7 The path to creating the Business Case...................................................................... 29 5.8 Step 1: Develop the Business Case ............................................................................ 29 5.9 Step2: Verify the Business Case ................................................................................. 30 5.10 Step 3: Maintain the Business Case....................................................................... 31 5.11 Step 4: Confirm the Benefits................................................................................... 31 5.12 The Benefits Review Plan....................................................................................... 32 5.13 Example of a Poor Business Case ......................................................................... 33 5.14 The Contents of a Business Case .......................................................................... 33 5.15 Example of Business Case for CRM Project.......................................................... 35 5.16 Appraisal Techniques ............................................................................................. 36 5.17 Business Case: Who is responsible for what? ....................................................... 37 5.18 Foundation and Practitioner Exam ......................................................................... 37 5.19 Learn Thru Questions ............................................................................................. 38 6 Organization ....................................................................................................................... 41 6.1 Introduction to Organization Knowledge...................................................................... 41 6.2 What happens in the real world? ................................................................................. 41 6.3 The Organization Knowledge provided by PRINCE2.................................................. 41 6.4 Organization Definitions............................................................................................... 42 6.5 Three Project Interests / 3 Stakeholder Categories..................................................... 42 6.6 The four levels of Organization.................................................................................... 43 6.7 Project Board ............................................................................................................... 46 6.8 The Project Board Roles.............................................................................................. 46 6.9 Project Assurance: User, Business & Supplier............................................................ 47
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The PRINCE2® Training Manual vi TAG.net MgmtPlaza PRINCE2® Audio Course 6.10 The Change Authority Role .................................................................................... 48 6.11 The Project Manager Role...................................................................................... 49 6.12 Team Manager & Project Support .......................................................................... 49 6.13 Project Support and centre of excellence.............................................................. 50 6.14 Project Manager and the Project Organization....................................................... 50 6.15 Stakeholder Engagement ....................................................................................... 51 6.16 The Communication Management Strategy........................................................... 52 6.17 Responsibilities for Organization Theme................................................................ 52 6.18 Foundation and Practitioner Exam ......................................................................... 53 6.19 Learn Thru Questions ............................................................................................. 53 7 Quality................................................................................................................................. 57 7.1 Introduction to Quality Knowledge............................................................................... 57 7.2 What happens in the real world? ................................................................................. 57 7.3 The Quality Knowledge provided by PRINCE2 ........................................................... 57 7.4 Quality Lingo ................................................................................................................ 58 7.5 Introduction to the PRINCE2 Approach to Quality:...................................................... 59 7.6 Part 1: Quality Planning Introduction ........................................................................... 59 7.6.1 Quality Plan Steps – Quality Audit Trail ............................................................ 60 7.6.2 The Customer’s Quality Expectations ............................................................... 61 7.6.3 Acceptance Criteria ........................................................................................... 62 7.6.4 The Project Product Description........................................................................ 63 7.6.5 Project Product Description Example................................................................ 63 7.6.6 The Quality Management Strategy Document .................................................. 65 7.6.7 Product Descriptions ......................................................................................... 66 7.6.8 Quality Register ................................................................................................. 67 7.7 Part 2: Quality Control Introduction & Quality Methods............................................... 68 7.7.1 Quality records, approval records and acceptance records.............................. 69 7.8 The PRINCE2 Quality Review Technique ................................................................... 69 7.9 Responsibilities ............................................................................................................ 70 7.10 Quality Summary .................................................................................................... 71 7.11 Foundation and Practitioner Exam ......................................................................... 72 7.12 Learn Thru Questions ............................................................................................. 72 8 Plans................................................................................................................................... 76 8.1 Introduction to Plans Knowledge ................................................................................. 76 8.2 What happens in the real world? ................................................................................. 76 8.3 The Plans Knowledge provided by PRINCE2 ............................................................. 77 8.4 Plans Lingo .................................................................................................................. 77 8.5 Three levels of a Plan .................................................................................................. 78 8.6 The Path to Planning ................................................................................................... 79 8.7 The Project Plan, Stage Plan and Team Plan ............................................................. 80 8.8 The Exception Plan – Introduction............................................................................... 80 8.9 The PRINCE2 Planning Steps and Design the Plan ................................................... 81
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The PRINCE2® Training Manual vii TAG.net MgmtPlaza PRINCE2® Audio Course 8.10 Step 1: Design the Plan – First of the 7 steps: ....................................................... 82 8.11 Step 2: Product-Based Planning Introduction......................................................... 82 8.12 PBP Step 1: Write the Project Product Description................................................ 83 8.13 PBP Step 2: Create the Product Breakdown Structure .......................................... 83 8.14 Product-Based Planning - Example........................................................................ 84 8.15 PBP Step 3: Write the Product Descriptions .......................................................... 86 8.16 PBP Step 4: Product Flow Diagram ....................................................................... 87 8.17 Step 3: Identify Activities and Dependencies ......................................................... 88 8.18 Step 4: Prepare Estimates...................................................................................... 88 8.19 Step 5: Prepare the schedule ................................................................................. 89 8.20 Document the Plan ................................................................................................. 91 8.21 Examples of Risks in Planning ............................................................................... 91 8.22 The Product Checklist............................................................................................. 91 8.23 Responsibilities....................................................................................................... 92 8.24 Plans Summary ...................................................................................................... 93 8.25 Foundation and Practitioner Exam ......................................................................... 93 8.26 Learn Thru Questions ............................................................................................. 94 9 Risk Theme......................................................................................................................... 98 9.1 Introduction to the Risk Knowledge ............................................................................. 98 9.2 What happens in the real world? ................................................................................. 98 9.3 Purpose of the knowledge in the Risk Theme............................................................. 98 9.4 Risk Lingo .................................................................................................................... 99 9.5 Risk Lingo - What is Risk Management..................................................................... 100 9.6 The Management of Risk Method & Risk Context..................................................... 100 9.7 The Risk Register - Risk History................................................................................ 101 9.8 The Risk Management Procedure Introduction ......................................................... 102 9.9 Step 1: Identify........................................................................................................... 103 9.10 How to Express the Risk....................................................................................... 104 9.11 Step 2: Assess Risk.............................................................................................. 105 9.12 Step 2: Assess Risk: Estimating........................................................................... 105 9.13 Step 2: Assess Risk – Evaluate............................................................................ 107 9.14 Step 3: Plan is about Planning the Responses .................................................... 107 9.15 Plan the Responses to Threats ............................................................................ 108 9.16 Plan the Responses to opportunities.................................................................... 109 9.17 Step 4: Implement the Responses ....................................................................... 110 9.18 Step 5: Communicate ........................................................................................... 111 9.19 What is a Risk Budget? ........................................................................................ 111 9.20 Risk Roles and Responsibilities............................................................................ 111 9.21 Risk Summary ...................................................................................................... 112 9.22 Learn Thru Questions ........................................................................................... 113 10 Change ............................................................................................................................. 118 10.1 Introduction to Change Knowledge ...................................................................... 118
8. 8. The PRINCE2® Training Manual viii TAG.net MgmtPlaza PRINCE2® Audio Course 10.2 What happens in real world? ................................................................................ 118 10.3 Purpose of knowledge in the Change Theme ...................................................... 119 10.4 Change Lingo ....................................................................................................... 119 10.5 The PRINCE2 Approach to Change..................................................................... 120 10.6 Configuration Management Strategy.................................................................... 120 10.7 How to prioritize issues & track severity............................................................... 121 10.8 Change Authority and Change Budget................................................................. 121 10.9 Management Products used by the Change Theme............................................ 122 10.10 The Configuration Management Procedure ......................................................... 124 10.11 Issue and Change Control Procedure: ................................................................. 125 10.12 Capture: Issue and Change Control Procedure: ................................................. 126 10.13 Examine: Issue and Change Control Procedure: ................................................ 127 10.14 Propose................................................................................................................. 128 10.15 Decide................................................................................................................... 129 10.16 Implement ............................................................................................................. 129 10.17 Roles and Responsibilities.................................................................................... 130 10.18 Summary............................................................................................................... 131 10.19 Learn Thru Questions ........................................................................................... 131 11 Progress ........................................................................................................................... 136 11.1 Introduction ........................................................................................................... 136 11.2 What happens in the real world? .......................................................................... 136 11.3 Purpose of the information in the Progress Theme.............................................. 137 11.4 Progress, Progress Controls, Exceptions and Tolerances................................... 137 11.4.1 When are the Six Tolerances set? .................................................................. 138 11.5 What is the PRINCE2 Approach to Progress? ..................................................... 138 11.6 What are the 3 Project Board Controls?............................................................... 140 11.7 Use of Management Stages for Control ............................................................... 141 11.8 What are Technical Stages?................................................................................. 142 11.9 Event-Driven and Time-Driven Controls............................................................... 143 11.10 How does the Project Manager review progress?................................................ 143 11.11 Capturing and reporting lessons........................................................................... 145 11.12 Reports used to Report Progress ......................................................................... 145 11.13 What is Raising Exceptions? ................................................................................ 146 11.14 Progress Responsibilities ..................................................................................... 146 11.15 Progress Summary............................................................................................... 147 11.16 Learn Thru Questions ........................................................................................... 147 12 Introduction to Processes................................................................................................. 150 12.1 Introduction to Processes ..................................................................................... 150 12.2 The PRINCE2 Processes ..................................................................................... 150 12.3 Pre-Project............................................................................................................ 150 12.4 Initiation Stage ...................................................................................................... 151 12.5 Next Stage or Stages after the Initiation Stage .................................................... 151
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The PRINCE2® Training Manual ix TAG.net MgmtPlaza PRINCE2® Audio Course 12.6 The PRINCE2 Process Model Introduction .......................................................... 152 12.7 Introduction to the Seven Processes.................................................................... 152 12.8 Learn Thru Questions ........................................................................................... 153 13 Starting Up a Project ........................................................................................................ 155 13.1 Introduction ........................................................................................................... 155 13.2 Purpose & Objective of the Starting Up a Project Process .................................. 155 13.3 Activities Introduction............................................................................................ 155 13.4 Appoint the Executive and the Project Manager .................................................. 157 13.5 Capture Previous Lessons.................................................................................... 157 13.6 Design and appoint the Project Management Team ............................................ 158 13.7 Outline Business Case ......................................................................................... 158 13.8 Select Project Approach and Assemble Project Brief .......................................... 159 13.9 Plan the Initiation Stage........................................................................................ 160 13.10 Summary of Activities ........................................................................................... 161 13.11 Learn Thru Questions ........................................................................................... 161 14 Initiating a Project ............................................................................................................. 163 14.1 Introduction ........................................................................................................... 163 14.2 Purpose & Objective............................................................................................. 163 14.3 Activities................................................................................................................ 163 14.3.1 Prepare the Risk Management Strategy ......................................................... 164 14.3.2 Prepare the Configuration Management Strategy........................................... 165 14.3.3 Prepare the Quality Management Strategy..................................................... 166 14.3.4 Prepare the Communication Management Strategy ....................................... 167 14.3.5 Setting Up the Project Controls ....................................................................... 168 14.3.6 Create the Project Plan ................................................................................... 169 14.3.7 Refining the Business Case ............................................................................ 170 14.3.8 Assemble the Project Initiation Documentation............................................... 171 14.4 Learn Thru Questions ........................................................................................... 172 15 Directing a Project ............................................................................................................ 174 15.1 Introduction ........................................................................................................... 174 15.2 Introduction to the Directing a Project .................................................................. 174 15.3 Introduction to Activities........................................................................................ 175 15.3.1 Activity 1: Authorize initiation........................................................................... 176 15.3.2 Activity 2: Authorize the project ...................................................................... 176 15.3.3 Activity 3: Authorize a Stage or Exception Plan .............................................. 177 15.3.4 Activity 4: Give ad hoc Direction...................................................................... 178 15.3.5 Activity 5: Authorize Project Closure ............................................................... 179 15.4 Learn Thru Questions ........................................................................................... 180 16 Controlling a Stage ........................................................................................................... 183 16.1 Introduction ........................................................................................................... 183 16.2 Purpose & Objective............................................................................................. 183 16.3 Context.................................................................................................................. 183
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The PRINCE2® Training Manual x TAG.net MgmtPlaza PRINCE2® Audio Course 16.4 Introduction to Activities........................................................................................ 184 16.4.1 Activity 1: Authorize a Work Package.............................................................. 185 16.4.2 Activity 2: Review Work Package Status......................................................... 186 16.4.3 Activity 3: Receive complete Work Packages ................................................. 186 16.4.4 Activity 4: Review the stage status.................................................................. 187 16.4.5 Activity 5: Report Highlights............................................................................. 188 16.4.6 Activity 6: Capture and Examine Issues & Risks............................................. 189 16.4.7 Activity 7: Escalate issues and risks................................................................ 190 16.4.8 Activity 8: Take Corrective Action.................................................................... 191 16.5 Learn Thru Questions ........................................................................................... 192 17 Managing Product Delivery .............................................................................................. 194 17.1 Introduction ........................................................................................................... 194 17.2 Purpose & Objective............................................................................................. 194 17.3 Managing Product Delivery Activities ................................................................... 194 17.3.1 Activity: Accept a Work Package..................................................................... 195 17.3.2 Activity: Execute a Work Package................................................................... 196 17.3.3 Activity: Deliver a Work Package..................................................................... 197 17.4 Learn Thru Questions ........................................................................................... 198 18 Managing a Stage Boundary............................................................................................ 200 18.1 Introduction ........................................................................................................... 200 18.2 Purpose & Objective............................................................................................. 200 18.3 Context.................................................................................................................. 200 18.4 Managing a Stage Boundary Activities................................................................. 201 18.4.1 Activity 1: Plan the next Stage......................................................................... 202 18.4.2 Activity 2: Update the Project Plan .................................................................. 202 18.4.3 Activity 3: Update the Business Case.............................................................. 203 18.4.4 Activity 4: Report stage end............................................................................. 204 18.4.5 Activity 5: Produce an Exception Plan............................................................. 205 18.5 Learn Thru Questions ........................................................................................... 206 19 Closing a Project .............................................................................................................. 208 19.1 Introduction ........................................................................................................... 208 19.2 Purpose & Objective............................................................................................. 208 19.3 Context.................................................................................................................. 208 19.4 Closing a Project Activities ................................................................................... 209 19.4.1 Activity 1: Prepare planned closure................................................................. 209 19.4.2 Activity 2: Prepare premature closure ............................................................. 210 19.4.3 Activity 3: Handover products.......................................................................... 211 19.4.4 Activity 4: Evaluate the project ........................................................................ 211 19.4.5 Activity 5: Recommend Project Closure .......................................................... 212 19.5 Learn Thru Questions ........................................................................................... 213 20 Tailoring PRINCE2 to the project environment ................................................................ 216 20.1 Introduction and What Tailoring Is........................................................................ 216
11. 11. The PRINCE2® Training Manual xi TAG.net MgmtPlaza PRINCE2® Audio Course 20.2 What is Tailoring? ................................................................................................. 216 20.3 General Approach to Tailoring.............................................................................. 216 20.4 What to change when tailoring ............................................................................. 217 20.5 Working in a Program Environment...................................................................... 218 20.5.1 Tailoring the Themes of Quality, Plans, Risk, Change & Progress................. 218 20.5.2 Tailoring Processes & Management Products ................................................ 219 20.6 Project Scale – Simple Projects ........................................................................... 219 20.6.1 Tailoring: Project Scale Introduction................................................................ 219 20.6.2 Tailoring for Simple Project: Effect on Themes............................................... 220 20.6.3 Tailoring: Simple Projects................................................................................ 221 20.7 Tailoring: Commercial Customer/Supplier Environment ...................................... 221 20.7.1 Tailoring: Effect on Business Case.................................................................. 222 20.7.2 Tailoring: Effect on Organization ..................................................................... 222 20.7.3 Tailoring: Effect on Quality & Risk................................................................... 222 20.7.4 Tailoring: Effect on Plans................................................................................. 223 20.7.5 Tailoring: Effect on Processes......................................................................... 223 20.8 Tailoring: Project Type.......................................................................................... 224 20.8.1 Tailoring: Project Type: Lifecycle Models........................................................ 224 20.8.2 Tailoring: Project Type: The Feasibility Project ............................................... 224 20.8.3 Tailoring: Project Management Bodies of Knowledge..................................... 224 Appendix A ................................................................................................................................ 226 Simple Glossary.................................................................................................................... 226
12. 12. Introduction – PRINCE2 1 TAG.net MgmtPlaza PRINCE2® Audio Course 1 Introduction – PRINCE2 1.1 The PRINCE2 Manual The official PRINCE2 manual for the Project Manager is called “Managing Successful Projects with PRINCE2”; this is an excellent reference manual. The manual is designed for: • Experienced Project Managers who want to learn PRINCE2 • Project Managers who want to have a reference manual for PRINCE2 We provide the PRINCE2 Training Manual, which is different from the official PRINCE2 manual in the following ways: • It is much more of a training manual and less of a reference manual. • PRINCE2 terms are explained with examples, which makes it easier to understand. • Manual is written in plain English so that you understand it the first time you read it. • A lot of examples of management documents are provided and we will continue to add more. • A project timeline overview has been provided to help understand how a project is divided. • Questions at the end of each chapter provide a good way to test your knowledge. • Diagrams are less complex and easier to read. Two other comments on the PRINCE2 Training Manual: • It is available in PDF format, which makes it easy to search and find the information you are looking for. • The MgmtPlaza PRINCE2 Audio Course is based on the PRINCE2 Training Manual so you can listen to the PRINCE2 Training Manual while driving, or walking. This is an excellent way to learn and expand your knowledge. To summarize everything, if you want to learn PRINCE2 then use the PRINCE2 Training Manual and if you want a good reference manual after your training, then use the official PRINCE2 manual “Managing Successful Projects with PRINCE2”. 1.2 What are Projects? Projects are seen as a way to introduce change, hence they are unique by nature, i.e., two identical projects are not done. Now some of you may be thinking that in your company the same projects keep repeating. Well, if they are exactly the same, then these are referred to as processes; and processes that repeat are referred to as “business as usual” or operations. Let us start with a more general definition of a project. I got this from Wikipedia. A project is a unique series of actions designed to accomplish a unique goal within specific time and cost limitations. I like this definition, as it is concise and easy to understand. It mentions terms like “series of actions,” “unique goal” and “within the constraints of time and money.” Another definition of a project is as follows: A project is a temporary endeavor undertaken to create a unique product or service. This might sound like something from Star Trek but it is actually from the Project Management Body of Knowledge (PMBoK). Now let us hear what PRINCE2 says about what a project is. This is a quote from the manual: “A project is a temporary organization that is created for the purpose of delivering one or more business products according to an agreed Business Case.”
13. 13. Introduction – PRINCE2 2 TAG.net MgmtPlaza PRINCE2® Audio Course You may not have understood this, as you need to know a little more about PRINCE2 first. It should start to make more sense in a few minutes after I start explaining what is meant by the words like temporary organization and unique, which appear in the definition. The word organization refers to the project team, the persons involved in the project and how they relate to each other. Each project has a definite start and end, so it is temporary. Remember, projects that go on forever are referred to as “operations” or “business as usual” and are not projects (e.g., maintenance of a software application). The word unique refers to the fact that these series of actions have not been done before. It is something new. For example, creating another car on an assembly line is not a project but an operation process. Introducing new state-of-the-art robots into the production line, however, would be a project, as this has not been done before. Business Case is the document that exists in a PRINCE2 project. It includes information such as why the project is a good idea from a business point of view, the benefits, costs and time information. 1.3 Why a Project Management Method? Project Management deals with planning, delegating, monitoring and controlling the project; in other words the administration of the project. Let us look at the role of the Project Manager. The role of the Project Manager is to achieve project objectives within the targets set for time, cost, quality, scope, benefits and risk. Let us look at some typical things that can go wrong in a project: I will use the building of a house as a sample project. This should be easy enough for the majority of people to understand unless you were born and have lived all of your life on a submarine. Coming back to the house project, let us suppose that you are using different subcontractors and all this needs to be coordinated so that work gets done properly. You might find out just one week before the plumbers are due to arrive that they may be delayed for one month. This will have a series of effects on most other work, as it will be difficult to reschedule other contractors and you may still have to pay part of their costs due to the agreement that you have with them. Let us consider another example: you may find during the installation of the window frames that the allocated space is too small. So project management is needed to better plan, monitor work, do numerous checks and signoffs, deal with risk, deal with issues as they arise, identify areas to cut costs, and so on. Other common project failures are: • Insufficient product definitions at the start, resulting in the wrong product being developed. • Lack of communication, which may cause a black cloud over the project. • Poor estimation of time and cost, which may cause the project to run out of money. So I am sure now you can see that there is a need for a good Project Management method. 1.4 What is PRINCE2? PRINCE2 is a generic method for Project Management. It can be used for any project, from running a 1- to 2-day project for the TV program such as “The Apprentice” (a popular TV program in the UK and US) to a company acquisition -- or even to the construction of the main stadium for the London 2012 Olympic Games. PRINCE2 separates the management layer from the work to create the required products that the project has to produce (specialist work). This means that the same management layer can be used for different types of projects. The Management Layer refers to the organization of the project, such as Project Board, Project Manager and Teams. You will see this more clearly when we discuss the process model later.
14. 14. Introduction – PRINCE2 3 TAG.net MgmtPlaza PRINCE2® Audio Course Another popular project method is the Project Management Framework, which is based on the book PMBoK (You may have heard of PMI. PMI stands for the Project Management Institute.) This method is very popular in the US while PRINCE2 is very popular in Europe. PRINCE2 is principle-based, meaning that a PRINCE2 project includes 7 principles. These will be discussed and explained in the next chapter. The 7 principles are: • Continued business justification • Learn from experience • Defined roles and responsibilities • Manage by stages • Manage by exception • Focus on products • Tailor to suit the project environment 1.5 Six variables / six performance targets The 6 variables / performance targets are : Timescales, Costs, Quality, Scope, Benefits and Risk. An easy way to remember these is to use the words TeCQuila SoBeR with Tequila spelled with TeCQ. This will give you Timescales, Costs, Quality, Scope, Benefits and Risks. Fig 1.1 The six project variables / six performance targets Timescales: The question to ask for timescales: When will the project be finished? Cost: Projects have to give a return on investment; therefore, the questions to ask are: Are the costs being controlled? and Are we within budget? Quality: Will the product be usable at the end of the project (in other words fit for purpose)? Scope: Is the scope well-defined and clear to all stakeholders? Care must be taken by the Project Manager to avoid scope creep, which is to allow new requirements to be added during the project. Benefits: Why are we doing this project and what are the benefits? Benefits must be clear and known by the Project Manager, and the benefits need to be delivered. Risk: All projects are unique and therefore have risk. How much risk can we take on and how can risk be managed? For example, in a project concerned with building a house, what happens if one of the subcontractors does not show up? PRINCE2 is a method that deals with the planning, delegation, monitoring and control of all six project variables which are, as you already know: Timescales, Costs, Quality, Scope, Benefits and Risks. The PMBok refers to these 6 variables as the 6 competing Project Constraints. 1.6 PRINCE2 Structure The PRINCE2 method consists of 4 main parts and PRINCE2 has chosen the word Elements (also called Integrated Elements) to represent these 4 parts. These elements are Principles, Themes, Processes and Tailoring. Use the structure of the manual to help you remember. First,
15. 15. Introduction – PRINCE2 4 TAG.net MgmtPlaza PRINCE2® Audio Course you have the Principles, then Themes, then Processes and finally the last chapter which is Tailoring. Fig 1.2 PRINCE2 Structure • Principles: PRINCE2 says that each project should consist of the 7 PRINCE2 principles (in other words, “best practices”). • Themes: Themes answer the question regarding what items must be continually addressed during each project, e.g., Business Case, Organization, Quality and Configuration Management. • Processes: Processes answer the question regarding what activities are done during the project and by whom. Processes also answers “What products are to be created and when?” • Tailoring: Tailoring answers one of the most common questions from a Project Manager, “How do I best apply PRINCE2 to my project or my environment?” 1.7 What does PRINCE2 not cover? It’s important to note what PRINCE2 does not cover and this can be listed in 3 categories. These are • Specialist Aspects • Detailed Techniques • Leadership Capability Specialist Aspects refers to the fact that PRINCE2 is very generic and can be applied to any type of project. Therefore PRINCE2 does not give specific information to run certain projects, for example, how best to structure a financial project organization or how to realize the benefits of a specialist financial product. Detailed Techniques: There are many techniques that can be used during a project like “Critical Path Analysis” or how best to run a brainstorm workshop. PRINCE2 advises to choose the techniques that are suitable for your project, but it does not provide information on them. PRINCE2 does provide information on Product-Based Planning and the Quality Review technique, however. Leadership Capability: Leadership, motivational ability and other soft skills are important for good project management, but there are many different kinds of leadership skills and styles. PRINCE2 advises to choose the best training programs that suit your particular environment. 1.8 Benefits of using PRINCE2: As you might possibly imagine, there are many advantages to using a Project Management method; this also applies to PRINCE2. I will list a few of them here. You don’t need to remember them, but it is good to be aware of them. I will also include some examples where necessary. Benefit 1: Best Practice: PRINCE2 has been used for more than 30 years in many thousands of projects, and PRINCE2 keeps learning from these projects. So all the feedback, suggestions, learning from other methods and discussions have benefited PRINCE2 and helped it become a best practice. Principles Themes Processes Tailoring
16. 16. Introduction – PRINCE2 5 TAG.net MgmtPlaza PRINCE2® Audio Course Benefit 2: PRINCE2 can be applied to any kind of project. This means that PRINCE2 can be used for projects as small as organizing a meeting, to huge projects the size of running an election, organizing a conference, constructing a bridge, or an IT project. Benefit 3: PRINCE2 provides a structure for roles and accountability (also referred to as “Roles and Responsibility”). All persons on the Project Team should know what is expected of them. This is even more important for the Project Managers, as they have the duty of checking that tasks are completed as agreed. Benefit 4: PRINCE2 is product-focused; meaning that the product is well-defined at the start of the project and is made known to all stakeholders. As a result, everybody has the same idea of what they are working on and the expected end-product. Benefit 5: PRINCE2 uses Management by Exception. This allows the Project Manager to handle certain project issues, but once an issue goes beyond a certain tolerance, it becomes an exception. It should then be escalated to the next higher management layer. We could say that Management by Exception allows the above management layer to manage a lower management layer. Benefit 6: PRINCE2 continues to assess the viability of the project from a Business Case point of view and this happens throughout the project lifecycle. If, for example, the expected return on investment is no longer probable at any point in the project, then the project should be stopped. Benefit 7: PRINCE2 has a well-defined structure for reports and Management Products. “Management Products” is the name given by PRINCE2 to refer to any document that is created to help manage the project. This includes Project Brief, Business Case, Project Plan, Highlight Reports and End Stage Report. You can refer to Appendix A for a description of each of these products. Benefit 8: PRINCE2 promotes learning and a continual improvement mindset (also known as “Lessons Learned”). You are encouraged to learn from other projects at the start of a project. During the project, you are encouraged to add a lesson to the Lessons Log and at the end of the project you should pass on lessons to future projects. You will see other benefits as you continue with this course. 1.9 What does a Project Manager do? You might already have a good idea about what a Project Manager does, but very often the Project Managers find themselves doing a lot of tasks as they try to keep the project on track. This might seem like a good idea at first, but they will end up not managing the project in the long run. Let us start at the very beginning. There is a project to do and, therefore, a Project Plan must be created. This is usually one of the first tasks for the Project Manager when the project starts up. They create the plan with help from specialists and it includes tasks such as leading a planning workshop, defining products, activities and dependences, estimating resources required, scheduling these activities and defining roles and responsibilities. The main objective for the Project Manager is to see that the project goes according to the plan. The Project Manager continues to review the completed tasks, get signoffs, and confirm that the following tasks can start and so on. In other words, the Project Manager monitors how well the work is going according to the Project Plan. Elevator Interview I will repeat this line in case that you are in an Elevator someday and somebody asks what you do. You can say “I monitor how well the work is going according to the project plan”. Monitor the 6 variables / performance targets The Project Manager will also constantly monitor the 6 variables we just discussed above that are part of any project. These are Timescales, Costs, Quality, Scope, Benefits and Risk. Dealing with Issues They also have to deal with issues as they arise. In the case of small issues, they might choose to handle these themselves (e.g., getting a supplier to work an extra day to solve the issue and get
17. 17. Introduction – PRINCE2 6 TAG.net MgmtPlaza PRINCE2® Audio Course the project back on track). If an issue arises such that could force the staget to go beyond the set tolerances, the Project Manager can escalate it to the Project Board. Speed up the project Another task of the Project Manager that is sometimes forgotten is to look for opportunities to speed the project up and reduce the costs. Lastly, I recommend that Project Managers spend the necessary amount of time defining and agreeing Roles and Responsibilities at start of the project. Depending on your company, you might need good soft skills to do this. This will benefit the project and could also prevent some stakeholders from passing their work and responsibility back to the Project Manager. 1.10 Learn Thru Questions Try and answer the following, these are taken from the Learn Thru Questions audio course. Check the answers in the Learn Thru Questions document available on our site: You can also listen to these questions and answers (use the LTQ audio course) Q01: Who is the “Managing Successful Projects with PRINCE2” manual designed for? Name 2 types of readers. Q02: Wikipedia provides a useful definition of a project, so complete the following sentence: “A project is a unique series of actions designed to accomplish a _______.” Q03: Complete the following definition of PRINCE2 in your own words: “A project is a temporary organization that is created for the purpose of _______.” Q04: In the PRINCE2 definition of a project, what do you think is meant by the term “A temporary organization”? Q05: Name some of the tasks that Project Management deals with. Q06: Finish the sentence: “Project Management is the planning, delegating, monitoring and control of all aspects of the project to achieve the project objectives within the expected performance target for ____.” (Tip: think of the 6 project variables.) Q07: A project can go wrong for many reasons. Can you think of what might go wrong if there is a poor product description, poor communication or poor estimation? (Note: This is not really a question but an exercise.) Q08: What is meant by the following sentence: “PRINCE2 separates the management layer from the specialist work.”? Explain with an example. Q09: What is meant by the following statement: “PRINCE2 is principle-based”? Q10: Try to list some of the 7 principles. (Don’t worry about the exact names, as you will only have to recognize the names in the exam.) Q11: Name some of the 6 variables that must be controlled in any project. Q12: Explain the variable cost and why it needs to be controlled. Q13: Explain the variable scope and why it needs to be controlled. Q14: Complete the following sentence: “PRINCE2 is a method that deals with the planning, delegation, monitoring and control of _____.” Q15: Name the four elements of PRINCE2.
18. 18. Introduction – PRINCE2 7 TAG.net MgmtPlaza PRINCE2® Audio Course Q16: Which PRINCE2 element is referred to in the following sentence: “They are the 7 best practices that should exist in each PRINCE2 project.” Q17: Which PRINCE2 element is referred to in the following sentence: “They are the items that must be continually addressed during each project (e.g., Business Case, Organization and Quality).” Q18: Which PRINCE2 element is referred to in the following sentence: “This element lists the activities that are done during the project. It lists the products that will be created and when they will be created.” Q19: What do you think is meant by the statement, “PRINCE2 does not provide detailed techniques”? Q20: What do you think is meant by the statement, “PRINCE2 does not provide leadership capability”? Q21: List 4 advantages of using a Project Management method like PRINCE2. Q22: Name one of the first plans that the Project Manager creates in the project that is based on the Plan Product Description found in the Appendix of the PRINCE2 manual. Q23: Describe in your own words what the main objective of the Project Manager is. Q24: Should the Project Manager also try to look for opportunities to speed up the project and reduce costs or ignore these opportunities and just focus on getting the project to run according to the plan?
19. 19. The Process Model and Project Timeline 8 TAG.net MgmtPlaza PRINCE2® Audio Course 2 The Process Model and Project Timeline 2.1 The PRINCE2 Process Model Hopefully you have seen and read the Introduction to PRINCE2 book (based on the PRINCE2 Process Model). This provides a helicopter view of PRINCE2 and is perhaps the best way to get an introduction to PRINCE2. So if you have not read it, then I suggest that you STOP right here and visit our site www.MgmtPlaza.com to get a copy. This Introduction to PRINCE2 book will: • give you a high-level introduction to the PRINCE2 Process Model • Show the relationship between processes and themes • Show how a project starts and how it moves from one process to another • Explain when, where and by whom the important documents are created • Cover the role of the Project Manager and Project Board • Explain how the Project Board controls the project • And show how a typical project closes The diagram below shows how a project starts and the typical next steps until the project is complete. This makes it easier to see how all the chapters of a PRINCE2 manual work together. Fig 2.1 The PRINCE2 Process Model diagrams At the end of the Introduction to the PRINCE2 book you will be able to understand the full Process Model; in fact, this is a must before starting to read this manual. You should also be able to draw the Process Model and be able to explain it to another person. If you don’t understand the Process Model, then learning PRINCE2 can be very difficult, as you will not be sure of or know how to use the knowledge that you will be gaining in the Themes, or understand how this knowledge fits into Project Management. This is why people trying to self-study from reading the official PRINCE2 manual (“Managing Successful Project with PRINCE2”) find it very difficult if they are not already used to Project Management or have worked in a PRINCE2 environment. If you attend a MgmtPlaza/TAG PRINCE2 Foundation Course, we start the course by asking you to do this, because it shows whether or not you have done your pre-course work. If you can draw the PRINCE2 Process Model, then you enjoy this course a lot more, understand a lot more, remember it longer and score higher in the exams. WorkPackage WorkPackage WorkPackage WorkPackage Based on OGC PRINCE2®material.Reproduced under licensefrom OGC
20. 20. The Process Model and Project Timeline 9 TAG.net MgmtPlaza PRINCE2® Audio Course Fig 2.2 The PRINCE2 Process Model diagram Blue items • All blue items are executed once in a project. Those items are (a) Starting up the Project, (b) Initiating the Project, (c) Creating the Project Initiation Documents, (d) Creating the Project Plan and (e) Closing the Project. Green items • All green items are executed once for each stage. • You can see from the diagram that Controlling a Stage and Managing Stage Boundaries work together. So if a project has four stages after start-up, then the items in green are executed four times. • There is just one exception that happens at the end of the final stage after all products have been delivered: the Closing a Project process follows the Controlling a Stage process, so Managing a Stage Boundary is not done at the very end of the final stage of a project. Orange items: • Orange items can be executed multiple times in a stage. For example, a Highlight Report can be sent by the Project Manager to the Project Board each week during a stage. And the Project Board can give Guidance and Instructions to the Project Manager at any time. Dark Red items • Dark Red items can be implemented multiple times during a stage, as the Project Manager can give a Work Package to a number of Team Managers. • A Team Plan can be created for each Work Package. Don’t worry if you don’t understand all these terms now; they will be explained in detail later in this book. 2.2 Project Timeline Although we think our Process Model diagram is good at showing how a project works, it does not give an idea of a project timeline. The solution for this is to look at the project from another point of view. For this reason we have created the project timeline overview. Team Plans Checkpoint Reports QualityRegister CompletedWP MPOutputs Delivery Team Manager Management Project Manager Direction Project Board Corp.. Based on OGC PRINCE2®material.Reproduced under licensefrom OGC www.MgmtPlaza.com Auth. To Initiate Authorize Project Approved PID Authorize stage EndStage Report NextStage Plan or ExceptionPlan (SB) Managing a Stage Boundary Exception Report ( Issue / Change & Risk) Highlight Report s Advice Premature Close Project Notification Initiation Notification Closure Notification Closure Recommend. End Project Report FAR, Lessons Rpt Draft Closure Notificat. Authorize initiation Authorize the project Authorize aStage orExceptionPlan Give adhoc direction Auth.project closure WorkPackage WorkPackage WorkPackage Completed WP Managing ProductDelivery (MP) Closing a project (CP) Initiating a Project (IP) Controlling a Stage (CS) Directing a Project (DP) Starting up a Project (SU) Req. to Initiate a Project Project Brief + IS Plan Project Init Doc Req. Deliver Project? Pre-Project Initiation Stages - Execution Close Project mandate Corporateor Programme Management Project Starts --Once during project --Once per stage --Many times during stage --Once per Work Package --Notification --Authorization --Management Product Notification Mgmt Prod Auth. close soon Products getcreated & quality checked
21. 21. The Process Model and Project Timeline 10 TAG.net MgmtPlaza PRINCE2® Audio Course The objective of this project timeline overview is to: • Give you an idea of a sample project • Give you an idea of how the processes might relate to each other in a project • Show when the Project Board gets involved in a project • Show which processes are done once and which are done more than once • Show how stages relate to each other and how the Closing a Project process is part of the last stage. 2.2.1 Starting Up a Project The Trigger to start the project is the project mandate. As you can see from the diagram, it appears from outside the project team. PRINCE2 says that the project mandate is created by someone from the Corporate or Program Management. Starting Up a Project (SU) is the first process and has the following main outputs that are given to the Project Board: • The Project Brief, which contains the outline of the Business Case • The Initiation Stage Plan, which is the plan for the Initiation Stage • The Project Product Description At the bottom of the diagram you can see the text “Pre-Project”. The SU process is considered to be outside the project. Actually, the project does not start until the Project Board takes their first decision. So the SU process provides the information to start the project. Project Board 1 st Decision: The very first decision the Project Board considers is whether to allow the Initiation Stage to start. This is known as “Authorize Initiation.” They determine whether the project is worth doing (desirable, viable and achievable) and check and approve the plan for the Initiation Stage. Fix 2.3 Timeline example: Starting Up a Project Timing: • The Starting Up a Project process can be very short compared to the rest of project. • This project example is about 8 months, but an average time for a Starting Up a Project could be one week, so these figures are just to give you an idea. It will differ from project to project. 1 week e.g. time Directinga Project Project Timeline / Example Controllinga Stage Initiationa Project / Starting Up a Project SU ManagingaStage Boundary www.MgmtPlaza.com ManagingProductDelivery project mandate Based on OGC PRINCE2®material.Reproduced under licensefrom OGC 60 hrs Closinga Project Project Board decisions 1: Authorize Initiation Pre-project (feasibility) --Once during project --Once per stage --Many times during stage --Once per Work Package
22. 22. The Process Model and Project Timeline 11 TAG.net MgmtPlaza PRINCE2® Audio Course 2.2.2 Initiating a Project Process / Initiation Stage After the first Project Board decision, the Project Manager uses the approved Initiation Stage Plan to run the Initiation Stage. This is the first stage of the project. The Initiation Stage has the following main outputs that form part of the PID: • The four strategy documents (i.e., Risk, Quality, Configuration & Communication Management) • The Business Case document (which is the responsibility of the Executive) • The Project Plan • The Product Descriptions • Project Controls describing how the project will be controlled • Roles & Responsibilities / Project Management Team Structure Most of the work in this first stage is facilitated by the Project Manager, with lots of support from: • the Executive to develop (refine) the Business Case. • persons representing the users help with product descriptions and quality requirements • specialists (also known as “Subject Matter Experts”) can also help with Product-Based Planning, which includes the creation of the Product Descriptions and estimating which is part of planning. • Senior user provides the expected benefits information which are measurable and when (timeline) they are expected to be realized. This information is stored in the Benefits Review Plan Fig 2.4 Timeline example: Initiation Stage Project Board: 2 nd Decision: At the end of the Initiation Stage, the Project Board is ready to make their 2 nd decision, which is to decide if the project should be allowed to continue to the 2 nd stage, as they will only authorize one stage at a time. They will review most of the information in the PID, especially the Business Case, which includes an overview of the Risks, Benefits & ROI information. They will also review the Project Plan and the plan for the 2 nd stage of the project. If the Project Board agrees, then they: • Authorize the Project – so the project can start • Authorize the Next Stage – so the first delivery stage can start. 1 week 4 weeks e.g. time Directinga Project 2: Authorize the Project Controllinga Stage I P Initiationa Project / Starting Up a Project SU ManagingaStage Boundary SB ManagingProductDelivery --Once during project --Once per stage --Many times during stage --Once per Work Package Project Timeline / Example www.MgmtPlaza.com project mandate Based on OGC PRINCE2®material.Reproduced under licensefrom OGC 60 hrs 850 hrs Closinga Project Project Board decisions 1: Authorize Initiation Initiation (Planning) Pre-project (feasibility)
23. 23. The Process Model and Project Timeline 12 TAG.net MgmtPlaza PRINCE2® Audio Course Timing: • The Initiation Stage, or the Initiating a Project process, is longer than the Starting Up a Project process and usually not as long as a normal stage, but, again, this depends on the project. • In the example above, the IP Stage is 4 weeks, while the next stage is 8 weeks. 2.2.3 Controlling a Stage – 1st delivery stage Controlling a Stage is where the Project Manager does most of their day-to-day work. They mainly do the following activities: • Give out work to Team Managers in Work Packages, check up on the status of these Work Packages and accept Work Packages back when complete. • Continually review the stage status – where are we now compared to the Stage Plan. • Provide regular reports to the Project Board. • Capture and examine issues and risks, and escalate if necessary. • Take corrective action to solve issues within their tolerance. Managing a Stage Boundary (SB): As you can see in the diagram below, the SB (Stage Boundary) process starts towards the end of the stage and before the Controlling a Stage process ends. The objectives of the Stage Boundary process are to prepare the following information for the Project Board: • End Stage Report – how well the stage did compared to the Stage Plan • Update the Business Case and Project Plan with actuals to date • Next Stage Plan – A plan for the next stage that needs to be approved • Benefits Review Plan – Check and update if expected benefits have or have not been realized Fig 2.5 Timeline example: Controlling a Stage / Delivery Stage Project Board Decision: At the end of the stage, the Project Board will do the following • Review the current stage using mainly the End Stage Report • Compare the progress of the project so far with the baselined Project Plan 1 week 4 weeks 8 weeks e.g. time Directinga Project 2: Authorize the Project Controllinga Stage CS : Stage I P Initiationa Project / Starting Up a Project SU ManagingaStage Boundary SB SB ManagingProductDelivery Work Packages 60 hrs 850 hrs Reports & Advise Closinga Project Authorize Next Stage Project Board decisions 1: Authorize Initiation Initiation (Planning) Pre-project (feasibility) delivery Stages - (Execution) --Once during project --Once per stage --Many times during stage --Once per Work Package Project Timeline / Example www.MgmtPlaza.com project mandate Based on OGC PRINCE2®material.Reproduced under licensefrom OGC
24. 24. The Process Model and Project Timeline 13 TAG.net MgmtPlaza PRINCE2® Audio Course • Review the Business Case to see if the project is still viable, and check risk information • Check the Next Stage Plan, which is the plan to run the next stage. • Review the Benefits Review Plan and compare expected benefits so far with actuals The very last thing that the Project Board does is to “Authorize the Next Stage” so that the Project Manager can continue with the next delivery stage. Timing: • In this example, the delivery stage is 8 weeks long. This will of course depend on the type of project and you will learn more about this in the Planning Theme. • You will also learn what is meant by the term ‘planning horizon’. 2.2.4 Next delivery stages Projects can have more than 2 stages and they are all separated by a Project Board decision, as the Project Board uses stages to keep control of the project. Fig 2.6 Timeline example: Next Delivery Stages As you can see from the example, this current delivery stage follows the same management pattern as the previous stage. The main differences between the two stages will be the content of the Work Packages given to the teams to develop. Project Board Decision: The Project Board will carry out the same activities as described at the end of the last stage. Timing: • In this example the current stage is the same as the last stage and, again, this can vary depending on the project. For example, if there was little risk involved in the 2 nd delivery stage and the Project Board has lots of confidence in the Project Manager after they have seen them manage the first stage, they might decide to lengthen the stages to 10 or 12 weeks. 1 week 4 weeks 8 weeks 8 weeks e.g. time Directinga Project 2: Authorize the Project Controllinga Stage CS : Stage CS : Stage I P Initiationa Project / Starting Up a Project SU ManagingaStage Boundary SB SB SB ManagingProductDelivery Work Packages Work Packages 60 hrs 850 hrs Reports & Advise Reports & Advise Closinga Project Authorize Next Stage Project Board decisions 1: Authorize Initiation Initiation (Planning) Pre-project (feasibility) delivery Stages - (Execution) --Once during project --Once per stage --Many times during stage --Once per Work Package Project Timeline / Example www.MgmtPlaza.com project mandate Based on OGC PRINCE2®material.Reproduced under licensefrom OGC
25. 25. The Process Model and Project Timeline 14 TAG.net MgmtPlaza PRINCE2® Audio Course 2.2.5 Last delivery stage and Closing a Project The project will continue until all delivery stages are complete and it will be closed at the end of the last stage. A good way to remember this is, “The Closing a Project process is always the last part of the last stage.” Normally towards the end of a stage, the Stage Boundary process is used to report on the current stage and plan the next one. As you can see from the diagram below, the Stage Boundary process is not used, but the Closing a Project process starts up near the end of the Controlling a Stage process. The Closing a Project process is where the Project Manager prepares the project for closure. Fig 2.7 Timeline example: Closing a Project The objectives of the Closing a Project process are to: • Update the Project Plan to show what has been delivered, approved and when • Hand over products and obtain acceptance • Evaluate the project and create the End Project Report • Benefits Review Plan – Check and update if expected benefits have or have not been realized The last thing that the Project Manager will do in the Closing a Project process is to recommend Project Closure to the Project Board. You can see it is not the Project Manager that closes the project. Again, we say that the Project Manager prepares the project for closure. Project Board Decision: The last decision the Project Board will take is to close the project. This is known as “Authorize Project Closure.” Before taking this decision they will do the following: • Review the baselined documents (Business Case and Project Plan) from the PID with the current documents to see how the project has performed compared to the original goals • Confirm that products have been accepted and signed off • Check the Lessons Learned report and hand it over so that it can be used for future projects • Review the Benefits Review Plan and compare expected benefits so far with actuals Timing: 1 week 4 weeks 8 weeks 8 weeks 8 + 1 weeks e.g. time Directinga Project 2: Authorize the Project Controllinga Stage CS : Stage CS : Stage CS : Stage I P Initiationa Project / Starting Up a Project SU CP ManagingaStage Boundary 2 weeks SB SB SB Closing a Project ManagingProductDelivery Work Packages Work Packages Work Packages 60 hrs 850 hrs Reports & Advise Reports & Advise Reports & Advise Closinga Project Authorize Next Stage Project Board decisions Closing 1: Authorize Initiation Initiation (Planning) Pre-project (feasibility) Authorize ProjectClose delivery Stages - (Execution) --Once during project --Once per stage --Many times during stage --Once per Work Package Project Timeline / Example www.MgmtPlaza.com project mandate Based on OGC PRINCE2®material.Reproduced under licensefrom OGC
26. 26. The Process Model and Project Timeline 15 TAG.net MgmtPlaza PRINCE2® Audio Course In this example the stage is 9 weeks and the Closing a Project process is done over a period of two weeks. Again, this will be different for each project but it does give you an idea. 2.2.6 Exception Plan example As you can see from the diagram, I have not included an Exception Plan example. I hope to add this in the future. 2.2.7 Timeline Summary The objectives of this Project Timeline were to: • Give you an idea of a sample project • Give you an idea of how the processes may relate to each other in a project • Show when the Project Board gets involved in a project • Show which processes are done once and which are done more than once • Show how stages relate to each other and how the Closing a Project process is part of the last stage. The Timeline diagram has also shown: • How the project can be divided up into Pre-Project, Initiation Stage, Delivery Stages and finally the Closing Stage. • Which processes happen once or more than once in a project, e.g., the blue-colored processes, such as Starting Up a Project, Initiating a Project and Closing a Project, all happen just once. Fig 2.8 Project Board Decisions . Directinga Project 2: Authorize theProject --Once during project --Once per stage www.MgmtPlaza.com Based on OGC PRINCE2®material.Reproduced under licensefrom OGC AuthorizeNext Stage Project Board decisions 1: Authorize Initiation Authorize Project Close Closing Initiation (Planning) Pre-project (feasibility) delivery Stages - (Execution)
27. 27. Principles 16 TAG.net MgmtPlaza PRINCE2® Audio Course 3 Principles 3.1 Introduction to principles The PRINCE2 manual states that PRINCE2 is principle-based. This means that each PRINCE2 project should include the 7 principles and if even one of these principles is missing from the project, it cannot be considered a PRINCE2 Project. I like the following definition of a Principle: • Principles provide a framework of good project practice for those involved in a project. From a PRINCE2 point of view, a Principle is a core value that must always exist in a PRINCE2 project. There are seven principles and they can be summarized as: • Continued business justification • Learn from experience • Define roles and responsibilities • Manage by stages • Manage by exception • Focus on products • Tailor to suit the project environment To sum it up, think of principles as guides for good practice. 3.2 Principles: Continued Business Justification A PRINCE2 project must have continued business justification. This means that the reason to start the project must make sense from a business point of view and there must be a clear Return on Investment. For example, the project will cost €20,000 but over the first 2 years, it will deliver a savings of €80,000 for the company. “Does the project have business justification?” is the same as asking “Does the project have a valid Business Case?” If at any time during the project, the expected Return on Investments falls, for example, by about 80%), then the project will most likely be stopped. The Business Case document details the full Business Case, showing why the project should be done, the costs, the expected benefits and timescales. This material is also referred to as the business justification information. As the Business Case document is one of the first documents created in a project, it will prevent some projects that have few real benefits for the company from starting. The business justification is then checked throughout the lifetime of the project. This, for example, can happen at the end of each stage. Even projects that are started to comply with new legislation require justification. For example, the cost of not complying with new legislation might affect the company’s market share or the company could lose clients. This could therefore be given a monetary value. 3.3 Principles: Learn from Experience PRINCE2 project teams should learn from previous projects. They should therefore take initiative to uncover previous lessons learned and take these into account during the life of the project. We have mentioned before that Projects are unique, meaning that there is always something new. This creates an element of risk in each project. We can also say that each project has some unknowns which must be investigated. Now you can see why PRINCE2 urges the project team to take the necessary initiative to learn from similar projects that may have been done in the same company and if not, then get advice from other external people (for example, bring in outside consultants).
28. 28. Principles 17 TAG.net MgmtPlaza PRINCE2® Audio Course “Learn from experience” covers the full lifetime of the project, from Starting Up a Project, as the project progresses until the Project Closes. Any lesson learned during the project should be documented. Documented lessons should be passed on so they are available for future projects. PRINCE2 also states that it is the responsibility of everyone involved with the project to seek lessons learned rather than waiting for some else to provide them. 3.4 Principles: Defined Roles and Responsibilities In any project, people need to know what to do and what they can expect from others. From my perspective, this is one of the most important principles to get right from the beginning. PRINCE2 states that a project should have defined and agreed roles and responsibilities within an organization structure that engages the Business, User and Supplier Stakeholder interests. Projects can have people from different departments or companies, so it is important that the project has a clear team structure, otherwise it might be impossible to manage the project. According to PRINCE2, a project has 3 primary stakeholders. They are the Business sponsors, Users and Suppliers. • Business sponsors are those who make sure the project delivers value for money. • Users are usually the people who will use the products once created. They receive the benefits. • Suppliers provide the resources and expertise to the project and produce the products. These three primary stakeholders must be correctly represented in the Project Management Team. To summarize the principle “Defined Roles and Responsibilities,” a good Project Management structure answers the question “What is expected of me and what can I expect from others?” 3.5 Principles: Manage By Stages A good way to go about doing any large task or project is to break it up into manageable chunks. In PRINCE2 we refer to the manageable parts as stages. Actually they are called Management Stages. A PRINCE2 Project is planned, monitored and controlled on a stage-by-stage basis. These stages are referred to as Management Stages, as they are separated by Decision Points (also known as “Control Points”) by the Project Board. At the end of each stage, the Project Board assesses the performance of the last stage, the Business Case, the plan for next stage, and decides whether to proceed with the next stage. The Project Board has greater control over the project when the number of stages is high, but this also gives them more work. Fewer stages in a project indicate that the Senior Management will have less control and a lesser amount of work for the Project Board. Let us look at some of the advantages of stages. Stages provide a good approach to project planning, as they: • Allow the project to be divided into a number of manageable chunks. • Have a high-level Project Plan for the whole project and a very detailed plan for the current stage. • Make sure that the plans for future stages can also learn from previous stages . For example, if one team delivers their products quicker than expected, then this can be taken into account when creating the plan for the next stage. There are a minimum of two management stages in a project: The Initiation Stage and one further Management Stage. The Close a Project Process is part of the 2 nd Stage in a two-stage project. 3.6 Principles: Manage by Exception This is a term that people who are new to PRINCE2 will most likely not have heard before. Because it is important that you understand it, I will start a simple explanation and then give you
29. 29. Principles 18 TAG.net MgmtPlaza PRINCE2® Audio Course the PRINCE2 definition. The Project Manager has some tolerance to play with, when it comes to factors like time, cost, and scope, before they have to advise the Project Board that there is or might be a problem (e.g., cost can change ±10%). If the problem is small and it remains within the tolerances (e.g., the costs increase by 2% -- less than the 10% tolerance), then the Project Manager can deal with it and doesn’t have to alert the Project Board and take up their time. Manage by Exception is used by each level in the Project Organization to manage the level below. The layer below should only notify the above management layer if there is a big issue that is outside their tolerance. The PRINCE2 name for a big issue which means the issue is outside the agreed tolerance is Exception. Now imagine you are sitting on the Project Board. If everything is going OK, you won’t hear from the Project Manager except for the regular reports during a stage and at the end of the stage, unless there is an exception, hence the term Manage by Exception. The PRINCE2 definition for Manage by Exception is as follows: A PRINCE2 project has defined tolerances for each project objective to establish limits of delegated authority. PRINCE2 lists 6 tolerances that can be set. These are Time, Cost, Quality, Scope, Risk and Benefit. I will give examples only for Quality, Scope, Risk and Benefit, as Time and Cost are easier to understand. • Tolerance Quality: You are creating a new GSM and you want the keyboard to work for an average user for 7 years but you have a tolerance of ±5%. • Tolerance Scope: The requirements for a new GSM will have mandatory requirements plus ‘nice to have’ requirements. So the project can decide which ‘nice to have’ requirements to include, but must include the mandatory requirements. • Tolerance Benefit: A Benefit is a measurable improvement resulting from the project for one or more of the stakeholders. These are benefits for the project stakeholders. For example, increase marketing share by 5%, or create a new profitable market segment. One question asked throughout the project is: Is the project still on track to meet the expected benefits? • Tolerance Risk: Again, I’ll use the example of the GSM. There will be a set tolerance level for risk and if you hear of something that is above this level then you will notify the Project Board. For example, you find out that the risk is now very high -that one of the providers cannot supply a 5 mega pixel camera with the correct integration specifications. This can cause many issues for your project. To summarize, Manage by Exception provides the above management layer with a system to manage and control the lower management layer and they don’t need to be annoyed by each small issue. 3.7 Principles: Focus on Products You can imagine what happens when a product is not correctly described. All project stakeholders can have different ideas on what the product should be. This can cause many unnecessary meetings; time delays, unnecessary new requirements, misunderstanding of the quality required, additional costs and even an end product being produced that is of no use to anybody. A detailed Product Description will guide the project, build correct expectations and help to the deliver the required products. The PRINCE2 manual states the following: A PRINCE2 project focuses on the definition and delivery of products, in particular, their quality requirements. Good Product Descriptions provides clarity, as it defines the product’s purpose, composition, derivation, format, quality criteria and quality method. Good Product Descriptions also make it easier to determine resource requirements, dependences and activities. 3.8 Principles: Tailoring or Tailor to suit the Project Environment A PRINCE2 project should be tailored to suit the project’s size, environment, complexity, importance, capability and risk. If your project is a small one, such as to host a workshop with 10 people, or a very large one, like building a nuclear power plant, then you should tailor PRINCE2 to suit the project, as PRINCE2 can be applied to any type of project.
30. 30. Principles 19 TAG.net MgmtPlaza PRINCE2® Audio Course One criticism most project methods often get is that, “We don’t need a Project Method. Our projects are not that big and a project method will add a lot of unnecessary paperwork to each project”. This would happen if you try to follow PRINCE2 like a robot. But that is not the way to use PRINCE2. I often use the popular TV program, The Apprentice, as an example. This is usually a 2-day project where 2 teams compete with each other and each team has a Project Manager. You can see that PRINCE2 can be used by each Project Manager and the paperwork can be just a checklist with some notes. You can also see that most Project Managers keep making the same mistakes week after week. This shows that they don’t understand the principle of Learn from Experience or Lessons Learned. The purpose of tailoring is to: • Ensure that the Project Method relates to the project’s environment (i.e., if working in a financial environment, then align it with the existing management structure). • Ensure that the project’s controls are based on the project’s scale complexity, importance, capability and risk. (e.g., if there is a lot of risk in your project environment, then more time should be spent on dealing with Risk). The Project Initiation document should describe how the PRINCE2 method is tailored for that particular project. (Refer to chapter 20, “Tailoring” of this manual, for more information.) 3.9 Learn Thru Questions Try to answer the following questions that are taken from the Learn Thru Questions audio course. You can check the answers in the Learn Thru Questions document available from www.MgmtPlaza.com. Q01: What does the following statement mean: “PRINCE2 is principle-based”? Q02: List about 3 or 4 of the 7 Principles. Don’t worry about getting the names 100% correct. I will list all 7 principles so you can compare. Q03: How would you explain principles from a PRINCE2 point of view to another person? Answer in your own words. Q04: What is the name of the principle that deals with business reasons behind the project (in other words the Business Case)? Tip: the first word begins with C. Q05: In which document will you find Business Justification to start the project? This document becomes part of the Project Initiation Documentation. Q06: What should happen if during the Project, the business justification is no longer valid? Q07: What does the principle Continued Business Justification prevent at the start of a project? Q08: When does the Project Manager check for Business Justification in the project, for example, to ensure that the Business Case is still valid? Q09: What is the name of the principle that deals with Lessons Learned? Q10: As projects are unique by nature, what should the people involved at the start of a project do to reduce risks and unknowns and not make the same mistakes as in previous projects? Q11: According to PRINCE2, who has the responsibility to seek Lessons Learned? Q12: What do you think should happen if there were no similar projects or only insufficient ones that the project team could learn from within their organization?
31. 31. Principles 20 TAG.net MgmtPlaza PRINCE2® Audio Course Q13: PRINCE2 states that Lesson Learned covers the complete lifecycle of the Project. There are 3 phases for lessons – at the start of the project, during the project and at the end of the project. Can you list what the Project Manager & Stakeholders may do in these parts? Q14: What is the name of the principle that deals with Roles & Responsibilities? Q15: What is the key question that the principle “Defined Roles & Responsibilities” answers? Q16: Name the three primary stakeholders that are represented in a PRINCE2 project, in other words, who are the Project Management Team? Q17: Business Sponsors are 1 of 3 primary stakeholders in the Project Management Team. What do they do? Q18: Users are 1 of 3 primary stakeholders in the Project Management Team. What do they do? Q19: Suppliers are 1 of 3 primary stakeholders in the Project Management Team. What do they do? Q20: What three interests should be represented on the Project Board? Q21: What is the name of the principle that deals with stages? Q22: Why are stages referred to as Management Stages? Q23: Complete the following sentence: “A PRINCE2 Project is planned, monitored and controlled on a ________.” Q24 Name one task that the Project Board does at the end of each stage? Q25: Does PRINCE2 advise to have a detailed Project Plan and a detailed Stage Plan for the current stage? Q26: What is the minimum number of stages in a project? Q27: Can you explain what is meant by Manage by Exception? (Any similar answers to the one I give will be fine.) Q28: PRINCE2 lists 6 tolerances that can be set. These are also known as the Project Variables. Can you name some of them? (Tip: Think TeCQuila SoBeR) Q29: What principle in PRINCE2 provides the above management layer with a system to manage and control so as not to be annoyed by each small issue? Q30: What does a Project deliver? Tip: Think about the definition of a Project. (I am looking for a one-word answer.) Q31: What do you think would happen if there is a poor description of the product that the Project is to produce? Q32: What advantage does a good Product Description have? Q33: What message is the principle “Tailor to suit Project Environment” trying to get across? (Don’t worry about matching the words in the answer; any similar answer is good) Q34: Can PRINCE2 be applied to any type and size of project? Q35: In which document should it be described how the PRINCE2 method is tailored for that particular project?