PMP Notes

Typing my PMP notes…

I request you please comment if there is any mistake in my points….

Integration Management

1. Project Selection Method : Benefit measurement and Constrained optimization.
2. If the activity is having float, that means it is not in critical path.
3. PV  – Today’s value of future cash flows.
4. Sunk cost are expended cost.
5. Value Analysis: Finding a less costly way to do the same scope of work
6. direct cost: Attributes to an activity
7. Historical records are Best for estimating, Risk Management and Project Planning.
8. Proposed change may effect COST, QUALITY, RISK and RESOURCES.
9. Project management Plan: A formal, approved document used to control the project.
10. Double declining: A balance is a form of accelerated depreciation.
11. A product acceptance criterion is included in the project scope statement.
12. Integration is performed at key interface points ( Done by Project manager )
13. Project Charter, gives the project manager authority
14. Performance is compared against the project management plan or the project baseline.
15. Different versions mean “Configuration management”.
16. Larger the BCR, SPI & CPI the better.
17. High priority projects hold more senior management.
18. Influence the factors that affect change? ( Ans: Determing the score of change and fixing the root cause )
19. Returning the score of changes and fixing the root cause
20. Product of the Project is completed at the end of the project.
21. WBS best be thought of an effective aid for stakeholder communication and also used to communicate with customers.
22. WBS helps to understand the scope of the work.
23. Team buying is direct results of WBS Process.
24. Lowest Level of decomposition is work package and It can be performed by many people.
25. Project team is responsible for preparing scope baseline
26. Customer approves product scope, not project scope.
27. Scope control process integrates with other control process.

Types of project selection: 

1. Benefit Measurement methods

2. Constrained Optimization Methods ( Mathematical Approach ) 

Economical Models for Project section: Present Value, NPV,IRR, Payback period, Benefit cost ratio 

NPV == The project with great NPV will be selected. 

IRR == More IRR  the project selection

Payback Period: it is like ROI, quicker is better. 

Benefit Cost Ratio: Benefits cost ratio is more than 1 means benefits are greater than cost. 

EVA (Economic Value Added) : 

Law of Diminishing Returns:????

Depreciation: 

Straight Line Depreciation

Two types: 

Double Declining Balance 

Sum of Years Digits

Scope:

1. WBS best be thought of an effective aid for stakeholder communication and also used to communicate with customers.
2. WBS helps to understand the scope of the work.
3. Team buying is direct results of WBS Process.
4. Lowest Level of decomposition is work package and It can be performed by many people.
5. Project team is responsible for preparing scope baseline
6. Customer approves product scope, not project scope.
7. Scope control process integrates with other control process.

Communication management:

1. The kind of interface to alter your message is called NOISE
2. Transfer the call is Medium
3. Receives response to the message is called Feedback.
4. 90 % of PM’s Job is Communication
5. Read Power & Interest Topic. PMBOK 249 ( Very Important )
6. Rita Book: Page Number: 363 and read it couple of times.
7. Communication Channels Formula : n(n-1)/2 ( Surely you will get question )
8. Communication occurs internally, externally, vertically, and horizontally.
9. Know about Formal Written, Formal Verbal, Informal Written and Informal Verbal from Rita Page : 355 and do exercises in 356.

Time:

1. Define Activities: WBS -> Work Packages – > Activities
2. Rolling wave planning?
3. Portion of a Project schedule network diagram are after referred to as sub network or fragment network.

Procurement:

• Procurement: you are buying something
• RFP – Request for Proposal
• IFB – Invitation for Bid
• RFQ – Request for Quotation
• we could be seller or buyer
• we need to do procurement process each and every item you are procuring.
• Contract: It is a legal document.
• Contract will reduce your risk.
• Who writes the  contract:
• Centralized: These guys will handle all contracts in ur company
• decentralized.contract manager will be assigned to your project.
• Oligopoly: few seller exits
• Manage as a Project: seller manages contract as a project
• Contract should be there even for internal projects./ should have formal contract.
• Purchase – Product, Services and Results
• Contract is Formal,Written,Confidential, and Not to be disclosed.
• Contract types: Fixed Price ,Time and Material,Cost reimburse
• Fixed Price ( FP, Lump Sum / Firm Fixed Price )
• Fixed Price Economic Price Adjustment = Fixed Price with Prospective Price redetermination
• Terms and conditions should reflect the findings of a risk analysis.
• when the contract is no longer serves the needs of the contract it can be renegotiated if the appropriate parties agree to do so.

PMP Notes  QUALITY

Plan Quality: Identifying Quality requirements  and /or Standards for the project and product, and documenting how the project will demonstrate compliance.

Performance QA:  The Process of auditing Quality   requirement and the results from Quality Control Measurements to ensure appropriate quality standards and operational are used.

Perform QC: The processes of monitoring and recording results of executing the quality activities to assess performance and recommend necessary changes.

Quality, and  grade are not same.

PMP Notes COST

it involved in estimating , budgeting, and controlling costs

so that the project can be completed within the approved budget.

ESTIMATE COSTS: an estimate of the funds needed to complete the project.

DETERMINE BUDGET:: aggregates the cost of individual activities or work packages to establish the COSTBASELINE.

CONTROL COST: Monitor project cost to manage the budget and changed to cost baseline.

Ability to to influence cost is greatest at the early stages of the project,making early scope definition critical.

WBS component used for the project cost accounting is called the CONTROL ACCOUNT. (CA)

Each CA is assigned to unique code, or account number. that is directly linked to the performing organizations accounting system.

thresholds are typically expressed in % of deviations from the baseline plan.

cost management plan is  an integral part of the overall PM pan.

SUNK COST: money you have already spent.

Project cost management

life cycle costing: Take into consideration , what effect today;’s decision will have over the life of the product.

KPI:::

ROI

ROS

PV

NPV

QRR

BCR

Payback Method

COST : Cost to produce project result.

Price: sales price to the customer.

Estimate Costs:

ROM ( Rough Order of Magnitude ) : +/- 50 %

then +/- 10 %

Control Cost: TT:

EVM is commonly used method of performance measurement.

it integrates S.S.C and helps to measure and assess project performance and progress.

EVM develops and monitors three key dimensions of the work packages and control account.

planned Value ( PV ) : is authorized budget assigned to the work.

Total PV sometimes called as PMB ( Performance measurement Baseline).

Total  Planned value for the project is known as “Budget At Completion” (BAC).

Earned value ( EV ):  is often used to describe the % completion of a project.

actual cost ( AC ) Total cost actually incurred & recorded in accomplishing work performed for an activity or WBS.

VARIANCE :

Schedule variance : SV = EV – PV

Cost Variance :  CV = EV – AC

SPI : is to measure progress achieved compared to progress planned.

SPI  > 1  -> More work was completed than was planned.

SPI < 1 -> Less work was completed than was planned.

SPI = EV/PV

CPI – Value of the work completed compared to the actual cost Or Progress made on the project.

CPI < 1 -> is cost overruns

CPI >1 -> is cost under run

CPI= EV/AC

PMP notes Time

Time management

Define activities

Sequence activities

Estimate activity resources

Estimate activity durations

Develop schedule

Control schedule

Define activities:

– Inputs from score and integration management goes to define activities

–

Rolling wave planning

Plan as you go

Inputs

Scope baseline ( wbs, wbs dictionary , project scope statement )

Tools

Decomposition,rolling wave planning, template, expert judgement

Outputs

Activity list , activity attributes, milestone list

Activity attributes , includes known predecessors and successors.

sequence activities:

PDM ( Precedence Diagramming Method )

this is also called as Activity of Node.

mandatory dependencies :

Are  also referred to as hard logic. it often involve physical limitations.

Discretionary dependencies:

are sometimes referred as “Preferred Logic” / Preferential Logic/Soft logic

Predecessors:

common one is F to S

SS is less common

lag time : A lag directs delay in the successor activity.

purposefully put a delay  b/w the predecessor and successor.

lead time: A lead  allows an acceleration of the successor activity.

give a successor task some time to get started before the predecessor finishes.

Estimate activity resources :”

We need to know the resource calendar to estimate.

Composite resource calendar includes the availability, capabilities, and skills of human resources.

Estimate Activity Duration:

tools:

analogous estimating : is also known as top down

this is based on previous similar projects

Parametric Estimating :

this is more accuracy than analogous.

Three Point estimate :

realistic — most likely occur

optimistic — best case scenario

pessimistic – worst case scenario

critical path : is the string of activities that will delay the whole project if any one of them delayed.

critical path is an important tool for keeping your projects on track.

it is longest path.

schedule activities on critical path is called critical activities.

FLOAT: float for any activity is the amount of the time that it can

slip before it caused your project to be delayed.

FLOAT tells you how much extra time you have.

the FLOAT  for an activity on the CRITICAL path is ZERO.

SLACK = FLOAT

Early Start: is the earliest time that an activity can start.

Early Finish : is the earliest time that an activity can finish.

Late start: is the latest time that an activity can start.

Late finish : is the latest time that an activity can finish.

use FORWARDS PASS  to add early start and finish .

use BACKWARD PASS to add late start and finish.

calculating early start, last start, early finish, and last finish for activity in a network diagram using forward pass and backward pass . this is the CORE of  CRITICAL PATH ANALYSIS.

Develop schedule process is a core of time management

CRASH THE SCHEDULE: schedule compression tools

crashing / fast -tracking

crashing : adding moe resources to critical path

fast tracking: over lapping activities

crashing is expensive and risky.

Fast tracking may result in rework and increased risk.

MONTE CARLO ANALYSIS : is some kinf of What-If analysis.

when schedule changes, the following  documents has to update :

ACTIVITY REQUIREMENTS

CALENDAR

ACTIVITY ATTRIBUTES

PROJECT DOCUMENT UPDATES

RISK REGISTER

Critical chain method: It scheduling network analysis technique that modifies the project schedule to account for limited resources.

RESOURCE-CONSTRAINED CRITICAL PATH IS KNOWN A S THE CRITICAL CHAIN.

the resulting schedule often has an altered critical path .

ONCE BUFFER , placed at the end of the critical chain is called project buffer.

Resource LEVELING :  can often cause the original critical path to change.

Managing schedule change means keeping all of your schedule documents up to date.