PM Unit 2
PM Unit 2
PM Unit 2
Six Sigma is a structured approach to finding the root cause of more complex problems.
It uses data and an iterative process to analyze the quality of an organization’s processes,
determine the root cause of an issue, test solutions, and then ensure those solutions will
continue to be effective down the road.
To put it simply, the goal of the Six Sigma methodology is to eliminate bugs or defects
(which could be anything that doesn’t fit a customer’s expectations) as quickly as possible.
The Six Sigma method uses a step-by-step approach called DMAIC, an acronym that stands
for define, measure, analyze, improve, and control:
1. Define
A team of people, led by a Six Sigma expert, chooses a process to focus on and defines the
problem it wishes to solve.
2. Measure
The team measures the initial performance of the process, creating a benchmark, and
pinpoints a list of inputs that may be hindering performance.
3. Analyze
Next the team analyzes the process by isolating each input, or potential reason for any
failures, and testing it as the possible root of the problem.
4. Improve
The team works from there to implement changes that will improve system performance.
5. Control
The group adds controls to the process to ensure it does not regress and become ineffective
once again.
Contract
A contract is a document signed by the buyer and seller that defines the terms and conditions
of the buyer–seller relationship.
It serves as a legally binding agreement that obligates the seller to provide specific products,
services, or even results while obligating the buyer to provide specific monetary or other
considerations.
There are three general categories for procurement-type contracts
1. Fixed-price or lump-sum contracts
A total or fixed price is negotiated or set as the final price for a specific product or service.
Fixed-price or lump-sum contracts may include incentives for meeting certain objects or
penalties if those objectives are not met
For example, an organization may decide to outsource the development of an application
system to a consulting firm. Based on the project’s scope, the consulting firm will develop an
estimated schedule and budget. Both firms may then negotiate the final cost of the project.
2. Cost-reimbursable contracts
For these types of contracts, a payment or reimbursement is made to the seller to cover the
seller’s actual costs. These costs include direct costs (e.g., direct labour, materials) and
indirect costs (e.g., administrative salaries, rent, utilities, insurance). However, an additional
fee is added to the total direct and indirect costs as a profit to the seller
Cost-reimbursable contracts can also include incentives for meeting specific objectives or
penalties if specific objectives are not met.
In general, there are three types of cost-reimbursable projects:
a. Cost-plus-fee (CPF) or cost-plus-percentage-of-cost (CPPC): The seller is paid for the
costs incurred in performing the work as well as a fee based on an agreed-upon
percentage of the costs.
b. Cost-plus-fixed-fee (CPFF)—In this case, the seller is reimbursed for the total direct
and indirect costs of performing the work, but receives a fixed amount. This fixed
amount does not change unless the scope change
c. Cost-plus-incentive-fee (CPIF)—Under this type of contract, the seller is reimbursed
for the costs incurred in doing the work and receives a predetermined fee plus an
incentive bonus for meeting certain objectives.
3. Time and materials (T&M) contracts
A T&M contract is a mix of cost-reimbursable and fixed-price contracts. The buyer pays for
both time and materials required to complete the work. It can resemble a cost-reimbursable
contract because it is open-ended, or a fixed-price arrangement if unit rates are set.
5. How can project team members share their opinions related to the project in detail?
Project team members can share their opinions and contribute to project discussions in
various ways. Here are several methods and strategies for team members to express their
opinions related to the project:
1. Team Meetings:
Regular Meetings: Schedule regular team meetings to discuss project progress, challenges,
and upcoming tasks.
Agenda Inclusion: Include agenda items specifically for team members to share their
opinions and provide updates.
2. Open Communication Channels:
Communication Platforms: Use collaboration tools, messaging apps, and project management
software to facilitate ongoing communication.
Open Forums: Establish open forums or discussion boards where team members can post
their thoughts, ideas, and questions.
3. Brainstorming Sessions:
Structured Sessions: Conduct brainstorming sessions to generate ideas and solutions
collectively.
Encouragement: Encourage team members to contribute without fear of criticism during
brainstorming.
4. Surveys and Feedback Forms:
Anonymous Surveys: Conduct anonymous surveys to gather honest opinions on specific
project aspects.
Feedback Forms: Implement regular feedback forms to understand team members'
perspectives.
5. One-on-One Meetings:
Individual Sessions: Arrange one-on-one meetings with team members to discuss their
opinions in a more private setting.
Active Listening: Actively listen to their concerns, ideas, and feedback during these sessions.
6. Explain the project integration process in detail.
Project integration management involves coordinating all elements of a project, including
tasks, resources, stakeholders, and deliverables. The purpose of project integration
management is to ensure that processes run efficiently and meet predefined goals.
The practice consists of seven processes to effectively coordinate project activities.
1. Create project charter
Projects typically start out with the creation of a project charter, a short document that
provides an overview of the project and identifies the project manager and key stakeholders.
2. Develop project management plan
The next step involves developing a more detailed project plan, which specifies the project
scope statement, deliverables, timeline, milestones, and metrics to evaluate success. The
project plan is used to direct the execution of the project to meet overall requirements and
objectives.
3. Direct and manage project work
The next phase is project execution, in which the project manager takes charge of the
day-to-day work that must be done, such as: Directing the project team, Holding stakeholder
meetings, Tracking project progress. This phase ensures that tasks are being carried out
effectively according to the project plan and scope statement.
4. Manage project knowledge
Project knowledge management refers to the process of using existing information or
obtaining additional knowledge to reach project goals. This step ensures team members have
all the information they need to produce the required deliverables.
5. Monitor and control project work
The purpose of this step is to keep the project on track. If there are any deviations from the
project plan, they need to be identified and corrected.
6. Perform integrated change control
Changes to projects can sometimes be stressful if not handled properly, but with a change
control process in place they don’t have to be. That’s why change requests must be assessed
to ensure they don’t exceed the scope or approach scope creep, which refers to the increase in
requirements during the project lifecycle.
7. Close out the project
After all project work is complete and deliverables are shipped and approved by the client,
it’s time to close the project. Project closure serves as a reference for future endeavors and
provides insight on how to improve the project integration management system.
b. Project closure
All projects must come to an end, a project can be terminated for any number of reasons.
There are five circumstances for ending a project:
1. Normal: A completed project is one that achieves its goals within the cost, quality,
and schedule objectives. The project is transferred to the sponsor or customers, and
the end is celebrated with awards and recognition for those involved.
2. Premature: In some cases, a project may need to be completed early without all the
planned features due to external factors such as competition or legal requirements.
However, all stakeholders should carefully consider the risks of this decision.
3. Perpetual: Some projects become perpetual and never seem to end due to delays,
scope or MOV issues, or the addition of features. Organizations may struggle to
terminate unsuccessful projects due to egos, careers, or high payoffs. Admitting to
failure can be challenging in a corporate culture that values success.
4. Failed: Projects can fail due to a lack of attention to people, processes, or technology,
even if the project's value to the organization is defined. Cost and schedule overruns
can diminish the project's value to the point where completing it becomes more costly
than the benefits it provides.
5. Changed Priorities: Projects may be terminated due to changes in priorities, such as
financial or economic reasons or resource reallocation to higher-priority projects.
Misjudgment of a project's value or changes in organizational needs or technology can
also lead to termination. Some projects are gradually starved of budget until they are
ended, but the termination is disguised.
c. Vendor management
Vendor management is a term that describes the processes organizations use to manage their
suppliers, who are also known as vendors. Vendor management includes activities such as
selecting vendors, negotiating contracts, controlling costs, reducing vendor-related risks and
ensuring service delivery.
The vendors used by a company will vary considerably depending on the nature of the
organization and could include companies as diverse as seafood suppliers, IT vendors,
cleaners and marketing consultants. Vendors can also range in size from sole traders to large
organizations.
Importance
Vendor management is important for a number of reasons. For one thing, vendor management
plays a key role when it comes to selecting the right vendor for a particular business need. In
addition, companies can use vendor management to achieve business goals, such as
harnessing opportunities for cost savings, as well as taking steps to speed up the onboarding
process.
Vendors also need to be managed effectively in order to reduce the risk of supply chain
disruption and ensure the goods and services provided are delivered on time and to the
expected standard. Beyond this, an effective vendor management process can help companies
build stronger relationships with their vendors which may, in turn, lead to opportunities to
negotiate better rates.
Vendor management benefits
Improve vendor selection
Harness cost savings
Speed up vendor onboarding
Reduce the risk of supply chain disruption
Strengthen supplier relationships
Negotiate better rates
12. How to identify and evaluate risk during different project phases?
Identifying and evaluating risks during different project phases is a crucial aspect of effective
risk management. Here's a step-by-step guide on how to approach this process:
1. Project Initiation:
Stakeholder Analysis:
Identify and engage with key stakeholders to understand their expectations, concerns, and
potential risks associated with the project.
2. Project Planning:
Risk Identification Workshops:
Conduct workshops with project team members, stakeholders, and experts to brainstorm and
identify potential risks. Document all identified risks.
SWOT Analysis:
Perform a SWOT analysis (Strengths, Weaknesses, Opportunities, Threats) to identify
internal and external factors that could impact the project.
Historical Information:
Review lessons learned from previous similar projects to identify recurring risks and
successful risk responses.
3. Project Execution:
Regular Risk Reviews:
Conduct regular risk reviews during project execution to identify new risks and assess the
status of previously identified ones.
Performance Metrics Analysis:
Analyze project performance metrics to identify trends that might indicate emerging risks or
deviations from the plan.
4. Project Monitoring and Controlling:
Variance Analysis:
Continuously compare actual project performance against the planned baseline to identify
variances and potential risks.
Risk Audits:
Conduct risk audits to assess the effectiveness of risk responses and identify any new or
changing risks.
Project Status Meetings:
Include risk discussions as a regular agenda item in project status meetings to keep the team
informed and proactive in addressing risks.
5. Project Closure:
Final Risk Assessment:
Perform a final risk assessment before project closure to ensure that all risks have been
addressed or documented for future reference.
Lessons Learned:
Document lessons learned regarding risk management throughout the project and incorporate
them into the project closure report
13. How do risk monitoring and control strategies influence the oral success of a
project?
Effective risk monitoring and control strategies play a pivotal role in the overall success of a
project by helping to identify, assess, and manage potential risks throughout the project life
cycle. Here's how these strategies contribute to project success:
1. Early Risk Identification:
Continuous risk monitoring is essential for project success. It helps project teams to identify
potential threats and opportunities early, thus enabling them to address issues proactively and
prevent disruptions to project timelines and goals.
2. Improved Decision-Making:
Regular risk assessments and monitoring allow project managers to make informed decisions
about risk responses and project plan adjustments, enhancing the project's adaptability to
changing conditions.
3. Optimized Resource Allocation:
Optimizing resource allocation is possible with effective risk control strategies. Project teams
can reallocate resources more efficiently by understanding and mitigating risks. This
contributes to cost-effectiveness and ensures that resources are utilized where they are most
needed.
4. Enhanced Stakeholder Confidence:
Stakeholders, including sponsors, clients, and team members, gain confidence in the project
when they observe robust risk monitoring and control processes in action. Demonstrating a
proactive approach to managing risks instils trust in the project team's ability to navigate
challenges and deliver successful outcomes.
5. Prevention of Cost Overruns:
Implementing risk management measures can minimize cost overruns and prevent
unexpected expenses. By considering budgetary constraints, effective risk management
reduces the likelihood of financial surprises.
6. Maintaining Project Schedule:
Timely identification and control of risks contribute to schedule adherence. Addressing risks
promptly helps prevent delays, ensuring that the project stays on track and meets its
milestones and deadlines.
7. Increased Project Resilience:
Having contingency plans and alternative strategies in place can contribute to project success
by enhancing its resilience to uncertainties, both internal and external.
15. .How does effective communication management contribute to the overall success of
the project?
Effective communication management is a critical factor in the success of any project.Here
are several ways in which effective communication management contributes to the overall
success of a project:
1. Stakeholder Alignment:
Clear and consistent communication helps align the project team and stakeholders with the
project's goals, objectives, and expectations. When everyone understands their roles and
responsibilities, it reduces the likelihood of misunderstandings or conflicts.
2. Team Collaboration:
Effective communication fosters collaboration among project team members. Team members
can share ideas, updates, and feedback, which enhances problem-solving, creativity, and
overall team performance.
3. Risk Management:
Timely communication allows project managers to identify and address potential issues and
risks early in the project life cycle. It provides an opportunity to develop mitigation strategies
and avoid potential problems that could jeopardize the project's success.
4. Decision-Making:
Good communication is essential for informed decision-making.
5. Resource Management:
Clear communication helps in the efficient allocation and management of resources. Team
members are aware of their tasks, deadlines, and dependencies, reducing the likelihood of
resource conflicts or bottlenecks.
6. Change Management:
Projects often encounter changes, whether in scope, requirements, or timelines.
7. Quality Assurance:
Clear expectations and guidelines need to be communicated to the team to ensure that
deliverables meet the required quality criteria.
8. Customer Satisfaction:
Effective communication ensures that customer expectations are understood and met.
Regular updates and feedback mechanisms help in managing customer expectations and
satisfaction.
9. Progress Tracking:
Communication facilitates the tracking of project progress. Regular status reports, meetings,
and updates allow stakeholders to stay informed about the project's status, accomplishments,
and any deviations from the plan.
17. How can lessons learned from previous projects influence the decision-making
process in current projects?
Lessons learned from previous projects can have a significant impact on the decision-making
process in current projects by providing valuable insights, best practices, and strategies for
improvement. Here's how the lessons learned from past projects can influence
decision-making:
1. Risk Management:
• Influence: Lessons learned from previous projects can highlight risks that were not
adequately addressed in the past. This information can influence risk assessments and help
project managers proactively manage potential risks in the current project.
• Impact: By considering historical risk data, decision-makers can make informed
choices to mitigate or avoid risks, leading to better project outcomes.
2. Resource Allocation:
• Influence: Lessons learned can shed light on resource allocation issues in previous
projects, such as overutilization or underutilization of resources.
• Impact: Decision-makers can optimize resource allocation based on past experiences,
ensuring that resources are utilized efficiently to meet project objectives.
3. Project Planning and Scheduling:
• Influence: Previous projects may have experienced challenges related to project
planning and scheduling, such as unrealistic timelines or insufficient buffers.
• Impact: Lessons learned can guide the development of more realistic project plans,
helping decision-makers set achievable deadlines and allocate appropriate time for tasks.
4. Scope Management:
• Influence: Lessons learned can highlight issues related to scope changes, scope creep,
or inadequate change control processes.
• Impact: Decision-makers can implement better scope management practices based on
past experiences, preventing unnecessary changes and ensuring that project scope remains
well-defined.
5. Communication Strategies:
• Influence: Lessons learned may reveal communication breakdowns or challenges in
previous projects, such as insufficient stakeholder engagement.
• Impact: Decision-makers can develop improved communication strategies, ensuring
that information is effectively disseminated to all stakeholders, and addressing
communication issues identified in the past.
6. Quality Assurance:
• Influence: Lessons learned can provide insights into quality assurance processes that
worked well or failed in previous projects.
• Impact: Decision-makers can implement effective quality control measures based on
past experiences, ensuring that deliverables meet the required standards.
7. Vendor and Partner Relationships:
● Influence: Previous projects may have encountered challenges with vendors or
partners, such as delays, quality issues, or misalignment of goals.
• Impact: Decision-makers can apply lessons learned to select, manage, and collaborate
with vendors or partners more effectively, improving the overall success of the project.
8. Change Management:
• Influence: Lessons learned can provide insights into the success or failure of change
management processes in the past.
• Impact: Decision-makers can refine change management strategies based on historical
data, ensuring that changes are effectively implemented and accepted by the project team and
stakeholders.
9. Budget Management:
• Influence: Previous projects may have experienced budget overruns or unforeseen
expenses.
• Impact: Decision-makers can use lessons learned to develop more accurate budget
estimates, identify potential cost drivers, and manage project finances more effectively.
10. Continuous Improvement Culture:
• Influence: Emphasizing a culture of continuous improvement based on lessons
learned encourages teams to analyze past experiences and identify areas for enhancement.
• Impact: Decision-makers can foster an environment where team members actively
contribute to lessons learned, leading to ongoing improvements in decision-making processes
and project execution.