THE PMP EXAM PREP COURSE

Transcription

1 THE PMP EXAM PREP COURSE Session 4 PMI, PMP and PMBOK are registered marks of the Project Management Institute, Inc.

2 Agenda 9:00 10:15 Practice the PMP Questions 10:15 10:30 Break 10:30 12:00 Human Resource Mangmnt (Pass the PMP Exam, Ch. 7) 12:00 12:45 Lunch 12:45 2:15 Communications Mangmnt (Pass the PMP Exam, Ch. 8) 2:15 2:30 Break 2:30 4:00 Risk Management (Pass the PMP Exam, Ch. 9) 2

3 Practice the PMP Exam Chapters 7-8 the PMBOK Guide (5 & 6 of the Pass the PMP Exam) You have 50 questions Mark each one as A, B, C, or D You have 50 minutes to answer as many as possible in the exam you would have 1 hour Good luck! 3

4 HUMAN RESOURCE MANAGEMENT Chapter 7 of Pass the PMP Exam Chapter 9 of the PMBOK Guide

5 Overview High Medium Low Difficulty Memorisation Exam Importance 5

6 Human Resource Management One of the easier and shorter chapters in the PMBOK Guide Define a role for everyone on the project Define the responsibilities for each role Develop a high performing team 6

7 Human Resource Management Knowledge Area Processes Project Management Process Groups Initiating Planning Executing Monitoring & Controlling Closing Project Human Resource Management Plan Human Resource Management Acquire Project Team Develop Project Team Manage Project Team Table 3-1. Project Management Process Groups and Knowledge Area Mapping A Guide to the Project Management Body of Knowledge (PMBOK Guide) Fifth Edition Project Management Institute, Inc. All rights reserved 7

8 Project Human Resource Management 9.1 Plan Human Resource Management 9.2 Acquire Project Team 9.3 Develop Project Team.1 Inputs.1 Project management plan.2 Activity resource requirements.3 Enterprise environmental factors.4 Organisational process assets.2 Tools and Techniques.1 Organisation charts and position descriptions.2 Networking.3 Organisational theory.4 Expert judgment.5 Meetings.3 Outputs.1 Human resource management plan.1 Inputs.1 Human resource management plan.2 Enterprise environmental factors.3 Organisational process assets.2 Tools and Techniques.1 Pre-assignment.2 Negotiation.3 Acquisition.4 Virtual teams.5 Multi-criteria decision analysis.3 Outputs.1 Project staff assignments.2 Resource calendars.3 Project management plan updates.1 Inputs.1 Human resource management plan.2 Project staff assignments.3 Resource calendars.2 Tools and Techniques.1 Interpersonal skills.2 Training.3 Team-building activities.4 Ground rules.5 Colocation.6 Recognition and rewards.7 Personnel assessment tools.3 Outputs.1 Team performance assessments.2 Enterprise environmental factor updates 9.4 Manage Project Team.1 Inputs.1 Human resource management plan.2 Project staff assignments.3 Team performance assessments.4 Issue log.5 Work performance reports.6 Organisational process assets.2 Tools and Techniques.1 Observation and conversation.2 Project performance appraisals.3 Conflict management.4 Interpersonal skills.3 Outputs.1 Change requests.2 Project management plan updates.3 Project document updates.4 Enterprise environmental factors updates.5 Organisational process assets updates Figure 9-1. Project Human Resource Management Overview A Guide to the Project Management Body of Knowledge (PMBOK Guide) Fifth Edition Project Management Institute, Inc. All rights reserved 8

9 Plan Human Resource Management Inputs Tools and Techniques Outputs.1 Project management plan.2 Activity resource requirements.3 Enterprise environmental factors.4 Organisational process assets.1 Organisation charts and position descriptions.2 Networking.3 Organisational theory.4 Expert judgment.5 Meetings.1 Human resource management plan Figure 9-1. Project Human Resource Management Overview A Guide to the Project Management Body of Knowledge (PMBOK Guide) Fifth Edition Project Management Institute, Inc. All rights reserved 9

10 Human Resource Planning Same as the others start with planning! Sets out how you will Staff Manage Team build Assess and Improve the project team 10

11 Terms You Need to Know Types of organisation charts Responsibility Assignment Matrix (RAM) RACI (a type of RAM) Resource Histogram 11

12 Types of Organisation Charts PM RAM Role Responsibilities Authority Hierarchical-type organisation chart Matrix-based responsibility chart Text-oriented format 12

13 Responsibility Assignment Matrix (RAM) RACI Chart Activity Person Ann Ben Carlos Betty Ted Define A R I I I Design I A R C C Develop I A R C C Test A I I R I R = Responsible A = Accountable C = Consult I = Inform 13

14 Resource Histogram Staff Hours for Senior Designers Resource Levelling? Jan Feb Mar Apr May 14

15 Human Resource Management Plan Roles and responsibilities of team members and key stakeholders Organisation and resource charts Staffing management plan Where staff will come from and how you will release them Resource calendars Training needs Health and Safety requirements Motivation and reward methods 15

16 Acquire Project Team Inputs Tools and Techniques Outputs.1 Human resource management plan.2 Enterprise environmental factors.3 Organisational process assets.1 Pre-assignment.2 Negotiation.3 Acquisition.4 Virtual teams.5 Multi-criteria decision analysis.1 Project staff assignments.2 Resource calendars.3 Project management plan updates Figure 9-1. Project Human Resource Management Overview A Guide to the Project Management Body of Knowledge (PMBOK Guide) Fifth Edition Project Management Institute, Inc. All rights reserved 16

17 Acquire Project Team An executing process Carries out the staffing management plan Gets the right people working on the project You may have to negotiate for your resources Think back to types of organisations we have already covered and the challenges in getting your staff 17

18 Pre-Assignment Normal for roles to be defined before resources HOWEVER, sometimes specific resources are preassigned to fill a role Can happen even before a project begins E.g. the Project Charter 18

19 Negotiation Method to determine how scarce resources will be allocated PM s may have to negotiate both inside and outside the organisation 19

20 Acquisition Do not confuse with Acquire Project Team Refers to looking outside the organisation for resources i.e. advertising, recruitment, head hunting etc. 20

21 Types of project teams Dedicated Full time, Projectised organisations, Good for the project Part-time Functional or matrix organisations, focus is split Partnership Team members from different organisations partnering for greater power Virtual 21

22 Virtual Teams Group of people who may or may not see each other in person Becoming more and more popular with evolution of technology A good project manager must recognise the benefits and challenges of virtual teams 22

23 Multi-criteria decision analysis The process of acquiring project team members can take into account a variety of criteria to choose the right people for the team Criteria can include things like experience, expertise, location, aptitude and aspirations 23

24 Project Staff Assignments All team members should have a clear assignment, and defined roles and responsibilities 24

25 Develop Project Team Inputs Tools and Techniques Outputs.1 Human resource management plan.2 Project staff assignments.3 Resource calendars.1 Interpersonal skills.2 Training.3 Team-building activities.4 Ground rules.5 Colocation.6 Recognition and rewards.7 Personnel assessment tools.1 Team performance assessments.2 Enterprise environmental factor updates Figure 9-1. Project Human Resource Management Overview A Guide to the Project Management Body of Knowledge (PMBOK Guide) Fifth Edition Project Management Institute, Inc. All rights reserved 25

26 Develop Project Team It is the responsibility of the project manager to lead and develop a high performing team Building a sense of team and improving performance Providing all the necessary training Get the team to establish ground rules Should be done early and often 26

27 Interpersonal Skills 1. Leadership 2. Ability to build teams 3. Motivate people 4. Communication skills 5. Influencing 7. Political & cultural awareness 8. Negotiation skills 9. Trust 10.Conflict management 11. Coaching 6. Decision making Project Management Institute, A Guide to the Project Management Body of Knowledge, (PMBOK Guide) Fifth Edition, Project Management Institute Inc., 2013, Page

28 Leadership Styles What is your natural style of leadership? Directing Coaching Facilitating Supporting 28

29 Leadership Styles Autocratic Directing Leader Coaching Leader Leadership Style Facilitating Leader Supporting Leader Participative Early Phases Project Timeline Late Phases 29

30 Forms of Power You must know these! Reward Expert Legitimate Referent Punishment 30

31 Forms of Power Reward: The ability to give rewards and recognition Expert: Increased credibility because of subject matter expertise These are considered the two most effective forms of power according to the PMBOK Guide 31

32 Forms of Power Legitimate: Power based on position Referent: Based on personal power of individual or alignment with a more powerful individual Punishment: Also known as coercive; the ability to punish an employee. Considered by the PMBOK Guide to be the least effective form of power 32

33 Recognition and Rewards: Theories of Motivation Maslow s Hierarchy of Needs Humans will want to fulfil the bottom needs first and cannot fulfil higher needs until lower ones are fulfilled Self-actualisation Esteem Acceptance Security Physiological Self-fulfilment, growth, learning Accomplishment, respect, appreciation Love, affection, approval, association Security, stability, safe Need for air, water, food, shelter, clothing 33

34 More on Maslow The current need will always be the strongest motivator Self-actualisation Esteem Acceptance Security Physiological 34

35 McGregor Theory X and Y Assumes Managers see employees as either: THEORY X Need constant supervision Don t want to work Selfish THEORY Y Naturally motivated to do good work Need little external motivation Trustworthy Tip to remember the difference: X has a cross face, Y has a happy face 35

36 Ouchi Theory Z Focuses on increasing employee loyalty to the company by providing a job for life with a strong focus on the wellbeing of the employee, both on and off the job. Theory Z management tends to promote stable employment, high productivity, and high employee morale and satisfaction 36

37 Fiedler s Contingency Theory Leader s effectiveness contingent on two sets of factors Whether he or she is task-oriented or relationshiporiented Whether the environment is stressful or calm A task-oriented leader is more effective in stressful situations A relationship-oriented leader is more effective in calm situations 37

38 Herzberg's Motivation-Hygiene Theory Similar to Maslow Hygiene Factors will not motivate, but their absence will make staff unsatisfied E.g. Company policy, supervision, working conditions Motivation Factors will motivate, but only if Hygiene Factors are in place E.g. Achievement, work, responsibility, advancement 38

39 Vroom s Expectancy Theory The expectation of receiving a reward for a certain accomplishment will motivate people to work harder Only works if the accomplishment is perceived to be achievable 39

40 McClelland's Human Motivation, Achievement or Three Needs Theory People need three things: Achievement Power Affiliation Use these three needs to motivate employees 40

41 Tuckman 5 Stage Model of Team Development Performing Adjourning Performance Norming Storming Forming Time 41

42 Morris and Sashkin 6 step decision making model Did you read Appendix X3 of the PMBOK Guide? 1. Problem definition 2. Problem solution generation 3. Ideas to action 4. Solution action planning 5. Solution evaluation planning 6. Evaluations of the outcome and process NB: This slide is also here to show you we can t cover every possible topic but we do try. 42

43 Co-location rules! If possible always put people within sight of each other. Virtual teams challenge this A war room is an example of co-location 43

44 Manage Project Team Inputs Tools and Techniques Outputs.1 Human resource management plan.2 Project staff assignments.3 Team performance assessments.4 Issue log.5 Work performance reports.6 Organisational process assets.1 Observation and conversation.2 Project performance appraisals.3 Conflict management.4 Interpersonal skills.1 Change requests.2 Project management plan updates.3 Project document updates.4 Enterprise environmental factors updates.5 Organisational process assets updates Figure 9-1. Project Human Resource Management Overview A Guide to the Project Management Body of Knowledge (PMBOK Guide) Fifth Edition Project Management Institute, Inc. All rights reserved 44

45 Manage Project Team Executing process Uses the Staffing Management Plan Compares planned vs. actual Proactively controls change 45

46 Observation & Conversation What better way to manage the project team than by observing them individually and as a team, and by talking with them about how it is going? 46

47 Project Performance Appraisals Give team members regular feedback about individual, team and project performance. 47

48 Conflict Management At least one exam question requires you to know these: 1. Problem Solving/Collaborate 2. Compromise/Reconcile 3. Force/Direct 4. Smoothing/Accommodate 5. Withdrawal/Avoiding 48

49 Problem Solving/Collaboration Solve the actual problem Incorporating multiple viewpoints if necessary Best method according to the PMBOK Guide Confront the PROBLEM, not the PERSON 49

50 Compromise/Reconcile Getting participants to search for solutions Can be win-win Can also be lose-lose 50

51 Force/Direct Pushing one viewpoint on others Worst method according to the PMBOK Guide Doesn t help underlying problems; reduces team morale 51

52 Smooth/Accommodate Minimises problem to ease tensions and reduce conflict Doesn t solve problems 52

53 Withdrawal/Avoid Avoids problem altogether Not effective 53

54 Types of Team Roles Constructive Destructive 54

55 Constructive Team Roles Initiators Information seekers Information givers Encouragers Clarifiers Harmonisers Summarisers Gate keepers 55

56 Destructive Team Roles Aggressors Blockers Withdrawers Topic jumpers Dominators Devil s Advocates Recognition seekers 56

57 Practice Questions Pass the PMP Exam p

58 COMMUNICATIONS MANAGEMENT Chapter 8 of Pass the PMP Exam Chapter 10 of the PMBOK Guide

59 Overview High Medium Low Difficulty Memorisation Exam Importance 59

60 Communications Management Project Management is all about communication, communication, communication! It is the project manager s most important skill 60

61 Communication 90% of a project manager s time is spent communicating 50% of that time is spent communicating with the team 61

62 Communication Project manager should not be in control of every communication Project manager should control the communication process 62

63 Communications Management Knowledge Area Processes Project Management Process Groups Initiating Planning Executing Monitoring & Controlling Closing Project Communications Management Plan communications management Manage communications Control communications Table 3-1. Project Management Process Groups and Knowledge Area Mapping A Guide to the Project Management Body of Knowledge (PMBOK Guide) Fifth Edition Project Management Institute, Inc. All rights reserved 63

64 Project Communications Management 10.1 Plan Communications Management.1 Inputs.1 Project management plan.2 Stakeholder register.3 Enterprise environmental factors.4 Organisational process assets.2 Tools and Techniques.1 Communication requirements analysis.2 Communication technology.3 Communication models.4 Communication methods.5 Meetings.3 Outputs.1 Communications management plan.2 Project document updates 10.2 Manage Communications.1 Inputs.1 Communications management plan.2 Work performance reports.3 Enterprise environmental factors.4 Organisational process assets.2 Tools and Techniques.1 Communication technology.2 Communication models.3 Communication methods.4 Information management systems.5 Performance reporting.3 Outputs.1 Project communications.2 Project management plan updates.3 Project documents updates.4 Organisational process assets updates 10.3 Control Communications.1 Inputs.1 Project management plan.2 Project communications.3 Issues log.3 Work performance data.4 Organisational process assets.2 Tools and Techniques.1 Information management systems.2 Expert judgment.3 Meetings.3 Outputs.1 Work performance information.2 Change requests.3 Project management plan updates.4 Project documents updates.5 Organisational process assets updates Figure Project Communications Management Overview A Guide to the Project Management Body of Knowledge (PMBOK Guide) Fifth Edition Project Management Institute, Inc. All rights reserved 64

65 Plan Communication Management Inputs Tools and Techniques Outputs.1 Project management plan.2 Stakeholder register.3 Enterprise environmental factors.4 Organisational process assets.1 Communication requirements analysis.2 Communication technology.3 Communication models.4 Communication methods.5 Meetings.1 Communications management plan.2 Project document updates Figure Project Communications Management Overview A Guide to the Project Management Body of Knowledge (PMBOK Guide) Fifth Edition Project Management Institute, Inc. All rights reserved 65

66 Plan Communications All about creating the communications management plan How often and in what format communications will be distributed and updated What information will be included Which stakeholders will receive them 66

67 Tools and techniques.1 Communication requirements analysis Creating the communications register which guides all communications.2 Communication technology Making appropriate choices to maximize the efficiency of communications.3 Communication models Being aware of how communications works.4 Communication methods Choosing the best method Figure Project Communications Management Overview A Guide to the Project Management Body of Knowledge (PMBOK Guide) Fifth Edition Project Management Institute, Inc. All rights reserved 67

68 Communications technology The particular type of communication technology you choose to use to facilitate project communication is an important consideration because each stakeholder will respond differently to the technology chosen. Remember that what works well for one stakeholder may not work for another stakeholder. 68

69 Communications Channels (4-1)/2 = 4*3/2 = 12/2 = 6 n(n 1) 2 5(5-1)/2 = 5*4/2 = 20/2 = 10 69

70 Another Formula to Know Number of communication channels = n(n 1) 2 i.e. 12 people (including yourself) = 12(12 1) 2 = 12(11) 2 = = 66 There will be exam questions on this! 70

71 Manage Communications Inputs Tools and Techniques Outputs.1 Communications management plan.2 Work performance reports.3 Enterprise environmental factors.4 Organisational process assets.1 Communication technology.2 Communication models.3 Communication methods.4 Information management systems.5 Performance reporting.1 Project communications.2 Project management plan updates.3 Project documents updates.4 Organisational process assets updates Figure Project Communications Management Overview A Guide to the Project Management Body of Knowledge (PMBOK Guide) Fifth Edition Project Management Institute, Inc. All rights reserved 71

72 Manage Communications Execution of the communications management plan Process where the bulk of the project communications takes place Updates stakeholders on project progress 72

73 Tools and techniques.1 Communication technology.2 Communication models.3 Communication methods.4 Information management systems.5 Performance reporting 73

74 A Model for Communication Encode Message Decode Sender Decode Noise Noise Medium Feedback - Message Receiver Encode 74

75 Terms to Know Active Listening: taking active steps to ensure the message was understood. Provides feedback to indicate whether or not the message has been understood Effective Listening: similar to active listening, also includes monitoring non-verbal and physical communication 75

76 Terms to Know Non-verbal: body language, posture, etc. Most communication is non-verbal Paralingual: vocal but not verbal, includes tone of voice, pitch and volume how the words are said rather than what words are said 76

77 Methods of Communication Informal vs. formal Written vs. verbal Push vs. Pull vs. Interactive 77

78 Methods of Communication Method Informal written Formal written Informal verbal Formal verbal Examples s, memoranda Contracts, legal notices, project documents Meetings, discussions, phone calls, conversations Speeches, mass communications, presentations 78

79 Other forms of communication Effective meetings Kick-off meeting Wherever possible, face-to-face meetings are the best choice for communicating with stakeholders 79

80 Performance reporting Reports to the stakeholders how the project is progressing against the plan Uses a variety of methods and formats must be appropriate! Includes text based, numerical, RAG, graphical, or Gantt charts etc. 80

81 Control Communications Inputs Tools and Techniques Outputs.1 Project management plan.2 Project communications.3 Issues log.4 Work performance data.5 Organisational process assets.1 Information management systems.2 Expert judgment.3 Meetings.1 Work performance information.2 Change requests.3 Project management plan updates.4 Project documents updates.5 Organisational process assets updates Figure Project Communications Management Overview A Guide to the Project Management Body of Knowledge (PMBOK Guide) Fifth Edition Project Management Institute, Inc. All rights reserved 81

82 Control Communications Is a monitoring and controlling process 82

83 Control Communications Work performance data: covers practically all aspects of the project Work performance information: variances and indices (CV, SV, CPI, CPI C, and SPI) from last week Budget forecasts: EAC or ETC from last week 83

84 Practice Questions Pass the PMP Exam, p

85 RISK MANAGEMENT Chapter 9 of Pass the PMP Exam Chapter 11 of the PMBOK Guide

86 Overview High Medium Low Difficulty Memorisation Exam Importance 86

87 Risk Management Can be tough to get your head around Will feature on the exam in a few different ways All about planning and being proactive Give this section extra attention 87

88 Some Tips There are bad risks that negatively affect a project There are good risks that positively affect the project Risk is related to uncertainty 88

89 Risk Management Knowledge Area Processes Project Management Process Groups Initiating Planning Executing Monitoring & Controlling Closing Project Risk Management Plan Risk Management Identify Risks Perform Qualitative Risk Analysis Perform Quantitative Risk Analysis Plan Risk Responses Control Risks Table 3-1. Project Management Process Groups and Knowledge Area Mapping A Guide to the Project Management Body of Knowledge (PMBOK Guide) Fifth Edition Project Management Institute, Inc. All rights reserved 89

90 Project Risk Management 11.1 Plan Risk Management.1 Inputs.1 Project management plan.2 Project charter.3 Stakeholder register.4 Enterprise environmental factors.5 Organisational process assets.2 Tools and Techniques.1 Analytical techniques.2 Expert judgment.3 Meetings.3 Outputs.1 Risk management plan 11.4 Perform Quantitative Risk Analysis.1 Inputs.1 Risk management plan.2 Cost management plan.3 Schedule management plan.4 Risk register.5 Enterprise environmental factors.6 Organisational process assets.2 Tools and Techniques.1 Data gathering and representation techniques.2 Quantitative risk analysis and modeling techniques.3 Expert judgment.3 Outputs.1 Project document updates Figure Project Risk Management Overview A Guide to the Project Management Body of Knowledge (PMBOK Guide) Fifth Edition Project Management Institute, Inc. All rights reserved 11.2 Identify Risks.1 Inputs.1 Risk management plan.2 Cost management plan.3 Schedule management plan.4 Quality management plan.5 Human resource management plan.6 Scope baseline.7 Activity cost estimates.8 Activity duration estimates.9 Stakeholder register.10 Project documents.11 Procurement documents.12 Enterprise environmental factors.13 Organisational process assets.2 Tools and Techniques.1 Documentation reviews.2 Information gathering techniques.3 Checklist analysis.4 Assumptions analysis.5 Diagramming techniques.6 SWOT analysis.7 Expert judgment.3 Outputs.1 Risk register 11.5 Plan Risk Responses.1 Inputs.1 Risk management plan.2 Risk register.2 Tools and Techniques.1 Strategies for negative risks or threats.2 Strategies for positive risks or opportunities.3 Contingent response strategies.4 Expert judgment.3 Outputs.1 Project management plan updates.2 Project document updates Perform Qualitative Risk Analysis.1 Inputs.1 Risk management plan.2 Scope baseline.3 Risk register.4 Enterprise environmental factors.5 Organisational process assets.2 Tools and Techniques.1 Risk probability and impact assessment.2 Probability and impact matrix.3 Risk data quality assessment.4 Risk categorization.5 Risk urgency assessment.6 Expert judgment.3 Outputs.1 Project document updates 11.6 Control Risks.1 Inputs.1 Project management plan.2 Risk register.3 Work performance data.5 Work performance reports.2 Tools and Techniques.1 Risk reassessment.2 Risk audits.3 Variance and trend analysis.4 Technical performance measurement.5 Reserve analysis.6 Meetings.3 Outputs.1 Work performance information.2 Change requests.3 Project management plan updates.4 Project document updates.5 Organisational process assets updates

91 Plan Risk Management Inputs Tools and Techniques Outputs.1 Project management plan.2 Project charter.3 Stakeholder register.4 Enterprise environmental factors.5 Organisational process assets.1 Analytical techniques.2 Expert judgment.3 Meetings.1 Risk management plan Figure Project Risk Management Overview A Guide to the Project Management Body of Knowledge (PMBOK Guide) Fifth Edition Project Management Institute, Inc. All rights reserved 91

92 Plan Risk Management Creation of risk management plan: the sole output Output from here becomes input into the next processes 92

93 Risk Management Plan May include a Risk Breakdown Structure (RBS) At this stage, RBS does not identify specific risks! It identifies categories of risks that will be evaluated 93

94 Risk Breakdown Structure Project Technical External Organisational Project Management Requirements Subcontractors and suppliers Project dependencies Estimating Technology Regulatory Resources Planning Complexity and interfaces Market Funding Controlling Performances and reliability Customer Prioritisation Communication Quality Weather 94

95 Risk Breakdown Structure Lists the categories and sub-categories of potential risks At this stage, may include references to specific identified risks Functions as a reminder of the many sources from which risks may arise Don't confuse this with the other RBS the Resource Breakdown Structure 95

96 Identify Risks Inputs Tools and Techniques Outputs.1 Risk management plan.2 Cost management plan.3 Schedule management plan.4 Quality management plan.5 Human resource management plan.6 Scope baseline.7 Activity cost estimates.8 Activity duration estimates.9 Stakeholder register.10 Project documents.11 Procurement documents.12 Enterprise environmental factors.1 Documentation reviews.2 Information gathering techniques.3 Checklist analysis.4 Assumptions analysis.5 Diagramming techniques.6 SWOT analysis.7 Expert judgment.1 Risk register.13 Organisational process assets Figure Project Risk Management Overview A Guide to the Project Management Body of Knowledge (PMBOK Guide) Fifth Edition Project Management Institute, Inc. All rights reserved 96

97 Identify Risks Identifying the risks that could impact the project Identifying the nature and consequence of these risks Just the one output the risk register Updates to the risk register feature as outputs for the next three processes 97

98 The Watch List The watch list is used for low order risks If things change they may escalate to the risk register 98

99 Information Gathering Techniques SWOT analysis Delphi Brainstorming Expert interviews Root cause identification Diagramming techniques Ishikawa/fishbone/ cause-and-effect Influence diagrams Show how one set of factors may influence another Flow charts 99

100 Perform Qualitative Risk Analysis Inputs Tools and Techniques Outputs.1 Risk management plan.2 Scope baseline.3 Risk register.4 Enterprise environmental factors.5 Organisational process assets.1 Risk probability and impact assessment.2 Probability and impact matrix.3 Risk data quality assessment.4 Risk categorization.5 Risk urgency assessment.6 Expert judgment.1 Project document updates Figure Project Risk Management Overview A Guide to the Project Management Body of Knowledge (PMBOK Guide) Fifth Edition Project Management Institute, Inc. All rights reserved 100

101 Perform Qualitative Risk Analysis Usually done rapidly on the project in order to determine which risks are the highest priority Takes each risk from the risk register and analyses Probability (P) and Impact (I) The risks with the highest combination of probability and impact are the most important ones 101

102 Standardizing Qualitative Assessments Very low or 1 Low or 2 Moderate or 3 High or 4 Very High or 5 Scope No noticeable change to scope Minor changes to scope Significant change to scope Changes to scope unacceptable to sponsor or client Changes the complete purpose of the project Time No noticeable change to time Less than 10% increase in time 10-20% increase in time 20-30% increase in time Great than 30% increase in time Cost No noticeable change to cost Less than 10% increase in cost 10-20% increase in cost 20-30% increase in cost Great than 30% increase in cost 102

103 Probability and Impact Matrix Shows the impact (ratio scale) on an objective (e.g. cost, time, scope, quality) Each risk is rated on probability and impact Risk is scored as high, moderate or low according to organisation's thresholds 103

104 Probability and Impact Matrix Impact Probability Threats Opportunities

105 Some Other Tools & Techniques Risk Data Quality Assessment: how accurate is your data? Risk Urgency Assessment: how urgent is this risk? 105

106 Perform Quantitative Risk Analysis Inputs Tools and Techniques Outputs.1 Risk management plan.2 Cost management plan.3 Schedule management plan.4 Risk register.5 Enterprise environmental factors.6 Organisational process assets.1 Data gathering and representation techniques.2 Quantitative risk analysis and modeling techniques.3 Expert judgment.1 Project document updates Figure Project Risk Management Overview A Guide to the Project Management Body of Knowledge (PMBOK Guide) Fifth Edition Project Management Institute, Inc. All rights reserved 106

107 Perform Quantitative Risk Analysis Make sure you know the difference! Qualitative ranks them Quantitative assigns a value (quantity) to them using mathematical modelling and statistics Requires the prioritised list of risks from Qualitative, so must be done second 107

108 Data Gathering & Representation Interviewing: structured format for soliciting information from experts Expert Judgement: any form of input from experts 108

109 Quantitative Risk Analysis & Modelling Sensitivity Analysis: how sensitive is the project to risk? Tornado Diagrams: which area of the project is most sensitive to a given factor? 109

110 Quantitative Risk Analysis & Modeling Expected Monetary Value analysis: cost of event X likelihood of event Often calculated with Decision Trees Make sure you understand how the diagrams on slide 126 and p.254 of the Pass the PMP Exam! 110

111 Decision Tree Shows how to make a decision between alternative strategies (decision nodes) when the environment (chance nodes) is not known with certainty You must understand the logic behind decision trees! 111

112 Example Decision Tree Decision Definition Decision Node Chance Node Net Path Value Decision to be made Input: Cost of each option Output: Decision made (True, False) Input: Scenario probability, reward if it occurs Output: Expected monetary value (EMV) Computed: (Payoffs minus Costs) along Path Build new plant False -$120 Strong demand EMV of the Chance Node $41.5M 65% $200 $80M Weak demand 35% $90 -$30M Build or upgrade? EMV of the Decision Node $49M Upgrade existing plant True -$50 Strong demand EMV of the Chance Node $49.0M 65% $120 $70M Weak demand 35% $60 $10M The organization chooses to upgrade the existing plant because that alternative has an Expected Monetary Value (EMV) of $49M vs. the EMV of the build new plant option of $41.5M 112

113 Example Decision Tree Decision Definition Decision Node Chance Node Net Path Value Decision to be made Input: Cost of each option Output: Decision made (True, False) Input: Scenario probability, reward if it occurs Output: Expected monetary value (EMV) Computed: (Payoffs minus Costs) along Path Strong demand $200m 65% $200 - $120 = $80m $80m x 0.65 = $52m Build new plant -$120m EMV = $52m + -$10.5m = $41.5m Weak demand $90m 35% $90 - $120 = -$30m -$30m x 0.35 = -$10.5m Build or upgrade? Upgrade existing plant -$50m Strong demand $120m EMV = $45.5m + $3.5m = $49m Weak demand $60m 65% 35% $120 - $50 = $70M $70m x 0.65 = $45.5m $60 - $50 = $10M $10m x 0.35 = $3.5m The organization chooses to upgrade the existing plant because that alternative has an Expected Monetary Value (EMV) of $49M vs. the EMV of the build new plant option of $41.5M 113

114 Last, but not Least! Monte Carlo analysis: what-if analysis Performed by computers 114

115 Plan Risk Responses Inputs Tools and Techniques Outputs.1 Risk management plan.2 Risk register.1 Strategies for negative risks or threats.2 Strategies for positive risks or opportunities.3 Contingent response strategies.4 Expert judgment.1 Project management plan updates.2 Project document updates Figure Project Risk Management Overview A Guide to the Project Management Body of Knowledge (PMBOK Guide) Fifth Edition Project Management Institute, Inc. All rights reserved 115

116 Plan Risk Responses You have identified the risks, prioritised them, and assigned a value to them What do you do next logically? 116

117 Plan Risk Responses You have identified the risks, prioritised them, and assigned a value to them What do you do next logically? Proactively plan your response to each one REMEMBER: Work to be done as part of risk responses must be added to your project scope! 117

118 Risk Strategies For Negative Risks Avoid Transfer Mitigate Accept For Positive Risks Exploit Share Enhance Accept Know the differences and when to use which one 118

119 Strategies for Negative Risks Avoid: Don't engage in the activity that could lead to the risk Avoidance is bad in communications, but not necessarily in risk management Avoid risk of traffic on motorway by taking back roads 119

120 Strategies for Negative Risks Transfer: Make the risk someone else's problem Insurance! 120

121 Strategies for Negative Risks Mitigate: Lessen either the impact or the likelihood of the risk Hold an outdoor event in summer for less chance of a snowstorm Build a house to certain specifications to lessen the impact of a hurricane 121

122 Strategies for Positive Risks Exploit: Attempt to remove uncertainty and make sure event will happen If there's a risk that the project will be more profitable than anticipated, make sure contributing factors are identified and continued 122

123 Strategies for Positive Risks Share: Improve chances of risk occurring by working with another party Partner with a complementary vendor to respond to an RFP 123

124 Strategies for Positive Risks Enhance: Increase either the impact or the likelihood of the risk Increase risk of winning Lotto by buying more tickets 124

125 Strategy for Both Accept: If cost or impact of response is greater than cost or impact of risk, best strategy may be to accept it Cost of buying enough Lotto tickets to guarantee a win is greater than the prize don't buy Lotto tickets! 125

126 Contingencies and Workarounds Contingency plan, or Fallback plan your plan to deal with unforeseen risks triggered by pre-set conditions Workaround temporary solution to get you through the risk 126

127 Control Risks Inputs Tools and Techniques Outputs.1 Project management plan.2 Risk register.3 Work performance data.4 Work performance reports.1 Risk reassessment.2 Risk audits.3 Variance and trend analysis.4 Technical performance measurement.5 Reserve analysis.6 Meetings.1 Work performance information.2 Change requests.3 Project management plan updates.4 Project document updates.5 Organisational process assets updates Figure Project Risk Management Overview A Guide to the Project Management Body of Knowledge (PMBOK Guide) Fifth Edition Project Management Institute, Inc. All rights reserved 127

128 Control Risks You ve done all your planning now its time to do the controlling 128

129 Tools & Techniques Risk Reassessment: reassess as often as necessary for your project Risk Audits: about Risk Management, not about individual risks! Variance and Trend Analysis: can highlight increasing or decreasing likelihood of risk 129

130 Tools & Techniques Technical Performance Measurement Looking at technical measures and understand variations i.; weight, transaction times, escaped defects, storage capacity. Reserve Analysis Meetings 130

131 Practice Questions Pass the PMP Exam, p

132 Next Session Read chapters 12 and 13 of the PMBOK Guide, and Chapters 10, 11 and 12 of Pass the PMP Exam Will have a practice the PMP exam on ALL the PMP material in the afternoon Create your own the PMP style multi-choice practice questions 132