Understanding PRINCE 2®

Ken Bradley’s

Understanding PRINCE 2

PRINCE is a Registered Trademark of CCTA

Ken Bradley’s Understanding PRINCE 2

2

ISBN 1 902192 00 1

Published by:

SPOCE Project Management Limited

Homelife House

Oxford Road

Bournemouth, Dorset

BH8 8EZ

Telephone & Fax: 01202-780740

Switchboard: 01202-319987

E-Mail: [email protected]

Information: www.spoce.com

PRINCE is a Registered Trademark of CCTA

© Ken Bradley 1997

First Published October 1997

Revised and reprinted February 1999

All rights reserved by the copyright holder and the licensee. No part of this publication may bereproduced in any material form (including photocopying and/or storage in any medium byelectronic means and whether or not transiently or incidentally to some other use of thispublication) without the written permission of the copyright holder identified above, except inaccordance with the provisions of the Copyright Designs and Patents Act 1988. Applications forthe copyright holder’s written permission to reproduce any part of this publication should beaddressed to the publisher at the address above.


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Dedication

This book is dedicated to the many clients and friends who over the past two

decades have put their trust and key projects into my hands, often for just the first

few critical weeks of life and sometimes for support from cradle to grave. Thanks

also go to the “SPOCETTES” Carol and Livia who have used their charm and

charisma to ensure that this project was delivered on time, to the agreed plan and

only marginally over budget!

Ken Bradley

What Others Say About This Book

“An excellent companion to the CCTA PRINCE 2 Reference Manual. The many

clear diagrams and supporting text answer the questions What should I do now? –and Why?”

Martin Shepherd

ICL HR Consultancy

“This book provides a comprehensive and practical exposition of the PRINCE 2

Method and truly lives up to its title. Ken Bradley’s practical experience ofmanaging projects, together with his understanding of the needs of Project

Managers, whether new to the profession or old hands, gleaned from many yearsof providing consultancy and training is evident through the techniques and best

practice tips that abound in this publication.”

Dave Rose, Principal Consultant

Project Management

Devon IT Services


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LIST OF CONTENTS

Foreword ................................................................................................................................... 13

Who This Publication Is Intended For ......................................................................................... 13

Origins Of The PRINCE 2 Method .............................................................................................. 17

The PROMPT Methodology ........................................................................................................ 17

Government PROMPT................................................................................................................ 17

The Standard PROMPT Lifecycle ............................................................................................... 18

PROMPT Organisation - Stage Managers................................................................................... 18

PROMPT Planning..................................................................................................................... 19

The Enhancement Project And PRINCE...................................................................................... 19

PRINCE 2 And Other Developments ........................................................................................... 20

Introduction To PRINCE 2.......................................................................................................... 25

Benefits Of PRINCE 2 ................................................................................................................ 25

The Structure Of A PRINCE 2 Project......................................................................................... 26

The Key Elements Contained In PRINCE 2 ................................................................................. 28

The PRINCE 2 Processes............................................................................................................ 29

The PRINCE 2 Components:....................................................................................................... 30

The PRINCE 2 Techniques.......................................................................................................... 32

The Organisation Component ..................................................................................................... 33

The Project Board ...................................................................................................................... 34

The Project Manager.................................................................................................................. 35

The Team Manager..................................................................................................................... 35

Project Resources And (Specialist) Teams................................................................................... 36

Project Assurance....................................................................................................................... 36

Project Support .......................................................................................................................... 37

The Project Support Office.......................................................................................................... 37

Summary Of The Organisation Component ................................................................................. 37


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PRINCE 2 Planning.................................................................................................................... 38

Products Or Deliverables And Related Activities........................................................................ 38

Planning For The Delivery Of Specialist Products ...................................................................... 40

Resource Planning & Reporting.................................................................................................. 41

Quality Planning -BS/EN/ISO9001 ............................................................................................. 42

Tolerance And Planning ............................................................................................................. 43

The Controls Component ............................................................................................................ 44

Management Controls ................................................................................................................ 44

Project Initiation ........................................................................................................................ 44

End Stage Assessment (ESA)....................................................................................................... 45

Mid Stage Assessment (MSA) ...................................................................................................... 45

Tolerance ................................................................................................................................... 46

Project Closure .......................................................................................................................... 47

Highlight Reports ....................................................................................................................... 48

Stages......................................................................................................................................... 48

Business Benefits And Risk Management..................................................................................... 49

Planning For Quality.................................................................................................................. 50

Quality Controls - Quality Review............................................................................................... 50

Change Control .......................................................................................................................... 52

Configuration Management ........................................................................................................ 52

Filing Arrangements................................................................................................................... 53

Software Support For PRINCE 2 ................................................................................................ 53

Following This Introduction........................................................................................................ 54

PRINCE 2 Organisation - Introduction ....................................................................................... 57

Responsibilities In A PRINCE 2 Controlled Project.................................................................... 58

The Project Board ...................................................................................................................... 58

The Executive Role ..................................................................................................................... 59

The Senior User Role.................................................................................................................. 59


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The Senior Supplier Role ............................................................................................................ 59

Responsibilities Of The Project Board Members.......................................................................... 59

The Project Assurance Function ................................................................................................. 60

Delegation Of Day-To-Day Project Assurance ............................................................................ 61

The Project Manager.................................................................................................................. 61

Team Manager(s) ....................................................................................................................... 62

Responsibilities Of The Team Manager....................................................................................... 63

Team Managers And Technical Stages ........................................................................................ 64

Project Support .......................................................................................................................... 64

Customer:Supplier Environment ................................................................................................. 65

Developments On The PRINCE 2 Theme..................................................................................... 66

The Supplier Project Board ........................................................................................................ 67

Customer: Supplier Steering/Co-Ordinating Group..................................................................... 68

Customer: Supplier Project Manager.......................................................................................... 69

Customer:Supplier - Project Support .......................................................................................... 69

Organising The Managing Of Programmes................................................................................. 69

Programme Board, Programme Manager & Programme Support ............................................... 70

User/Customer Group In A Programme Context ......................................................................... 71

Individual Project Boards In A Programme Context.................................................................... 71

Project Support & Programme Assurance................................................................................... 71

Programme And Project Resources............................................................................................. 72

Other Structures Based On PRINCE 2 ........................................................................................ 72

PRINCE 2 Organisation - Summary........................................................................................... 74

Planning - Introduction & Overview ........................................................................................... 76

Project Level Plans..................................................................................................................... 77

Product Breakdown Structure ..................................................................................................... 78

Product Flow Diagram............................................................................................................... 80

PERT Network............................................................................................................................ 81


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The PERT Logic Network & The Timed Network......................................................................... 81

Earliest Start Gantt Plan ............................................................................................................ 82

Resource Smoothing ................................................................................................................... 82

Project Gantt Plan...................................................................................................................... 84

Project Resource Reporting ........................................................................................................ 84

Graphical Summary.................................................................................................................... 85

Earned Value Analysis................................................................................................................ 86

Risk Analysis .............................................................................................................................. 87

Measuring The Business Benefits ................................................................................................ 88

Project Plan Text........................................................................................................................ 89

Management Stage Plans............................................................................................................ 89

Team Plans ................................................................................................................................ 91

Individual Plans ......................................................................................................................... 91

PRINCE 2 Planning - Summary .................................................................................................. 91

Introduction To Controls ............................................................................................................ 94

Management Controls ................................................................................................................ 94

The Project Initiation Meeting .................................................................................................... 95

Project Initiation & The Project Initiation Document (PID) ........................................................ 96

End Stage Assessment (ESA)....................................................................................................... 96

Attendees At An End Stage Assessment........................................................................................ 97

End Stage Assessment Agenda .................................................................................................... 97

Mid Stage Assessment (MSA) ...................................................................................................... 98

Tolerance ................................................................................................................................... 99

Project Closure ........................................................................................................................ 102

Highlight Reports ..................................................................................................................... 102

Checkpoint Reports .................................................................................................................. 103

Stages....................................................................................................................................... 103

Management & Technical Stages .............................................................................................. 107


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Management Stages.................................................................................................................. 108

Updating The Business Case..................................................................................................... 108

Technical Stages....................................................................................................................... 109

Handling The End Of A Management Stage .............................................................................. 109

Stages - Summary ..................................................................................................................... 110

Risk Management - Introduction ............................................................................................... 113

Risk Ranges & Risk Factors...................................................................................................... 114

Updating The Risk Analysis ...................................................................................................... 115

Modifying The Risk Analysis Checklist ...................................................................................... 116

PRINCE 2 &BS/EN/ISO9001.................................................................................................... 123

Quality Management ................................................................................................................ 123

Customer Quality Expectations................................................................................................. 124

Quality Aspects For Suppliers & Sub-Contractors..................................................................... 124

Quality Management - Summary............................................................................................... 125

Configuration Management - Introduction ................................................................................ 129

Configuration Management Techniques .................................................................................... 129

CM Activities............................................................................................................................ 130

Change Control - Introduction.................................................................................................. 135

Project Issue............................................................................................................................. 135

Off Specifications ..................................................................................................................... 136

Request For Change ................................................................................................................. 136

Change Control Forms And Documentation.............................................................................. 136

Change Control - Summary ...................................................................................................... 137

Introduction To Processes ......................................................................................................... 141

The Processes........................................................................................................................... 141

The PRINCE 2 Process Model .................................................................................................. 142

Major Processes And Processes ................................................................................................ 143

Structure Of The Individual Process Models.............................................................................. 145


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Individual Process Summary Models........................................................................................ 147

Starting Up A Project (SU) - Introduction ................................................................................. 151

SU1 - Appointment Of A Project Board Executive And A Project Manager ................................ 152

SU2 & SU3 - The Project Management Team............................................................................ 153

SU5 - The Project Approach: .................................................................................................... 156

SU6 - The Initiation Stage Plan................................................................................................. 157

Starting Up A Project - Summary .............................................................................................. 158

Initiating A Project (IP) - Introduction ...................................................................................... 163

The Project Initiation Document ............................................................................................... 163

IP1 - Planning For Quality ....................................................................................................... 165

IP2 - Planning A Project........................................................................................................... 166

IP3 - Refining The Business Case & Risks................................................................................. 168

IP4 - Setting Up Project Controls.............................................................................................. 169

Project Board Controls ............................................................................................................. 169

Project Manager/Team Controls: .............................................................................................. 170

IP5 - Set Up Project Files ......................................................................................................... 171

IP6 - Assembling The Project Initiation Document .................................................................... 173

Approach To Assembling Or Producing The PID....................................................................... 174

Initiating A Project (IP) - Summary........................................................................................... 175

Directing A Project (DP) - Introduction .................................................................................... 181

Management By Exception........................................................................................................ 182

DP1 – Authorising Initiation..................................................................................................... 183

DP2 – Authorising A Project..................................................................................................... 184

DP3 – Authorising A Stage Or Exception Plan.......................................................................... 185

Approval Of Exception Plans .................................................................................................... 186

DP4 – Giving Ad-Hoc Direction ............................................................................................... 188

DP5 – Confirming Project Closure............................................................................................ 189

Summary Of The DP Process .................................................................................................... 191


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Controlling A Stage (CS) - Introduction .................................................................................... 197

CS1 – Authorising A Work Package .......................................................................................... 199

CS2 – Assessing Progress ......................................................................................................... 200

CS3 - Capturing Project Issues ................................................................................................. 202

CS4 - Examining Project Issues ................................................................................................ 203

CS5 - Reviewing Stage Status.................................................................................................... 204

CS6 - Reporting Highlights....................................................................................................... 205

CS7 - Taking Corrective Action ................................................................................................ 207

CS8 - Escalating Project Issues................................................................................................. 208

CS9 - Receiving A Completed Work Package ............................................................................ 209

Summary Of The Controlling A Stage Process........................................................................... 210

Managing Product Delivery (MP) - Introduction ....................................................................... 215

MP1 - Accepting A Work Package............................................................................................. 217

MP2 - Executing A Work Package............................................................................................. 218

MP3 - Delivering A Work Package............................................................................................ 219

Managing Stage Boundaries (SB) - Introduction ....................................................................... 223

Exception Plans........................................................................................................................ 224

SB1 - Planning A Stage............................................................................................................. 225

SB2 - Updating A Project Plan ................................................................................................. 226

SB3 - Updating A Project Business Case................................................................................... 227

SB4 -Updating The Risk Log..................................................................................................... 228

SB5 - Reporting Stage End........................................................................................................ 229

SB6 - Producing An Exception Plan.......................................................................................... 231

Summary Of The Managing Stage Boundaries Process.............................................................. 232

Closing A Project (CP) - Introduction ....................................................................................... 237

CP1 - Decommissioning A Project ............................................................................................ 239

CP2 - Identifying Follow-On Actions ........................................................................................ 241

CP3 – Project Evaluation Review............................................................................................. 242


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Summary Of The Closing A Project Process.............................................................................. 243

Planning (PL) - Introduction.................................................................................................... 247

PL1 - Designing A Plan ............................................................................................................ 249

PL2 - Identifying, Defining And Analysing Products.................................................................. 250

PL3 - Identifying Activities And Dependencies .......................................................................... 252

PL4 - Estimating....................................................................................................................... 253

PL5 - Scheduling ...................................................................................................................... 254

PL6 - Analysing Risks............................................................................................................... 255

PL7 - Completing A Plan.......................................................................................................... 256

Summary Of The Planning (PL) Process ................................................................................... 257

PRINCE 2 Filing Technique - Introduction ............................................................................... 261

The Management File ............................................................................................................... 261

Physical Filing Considerations ................................................................................................. 266

Quality Review Technique - Introduction .................................................................................. 269

Quality Assurance And Quality Control .................................................................................... 269

What Is A Quality Review?........................................................................................................ 269

Quality Reviews - Formal And Informal .................................................................................... 270

People Involved ........................................................................................................................ 270

The Quality Review Steps......................................................................................................... 271

Step 1 - Preparation ................................................................................................................. 271

Step 2 - The Review Meeting .................................................................................................... 272

Step 3 - Follow-Up Of Review Meeting ..................................................................................... 273

Summary Of The Quality Review Technique.............................................................................. 274

Index ........................................................................................................................................ 277


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FOREWORD

This publication is based on the PRINCE 2 Project Management Methodology. It has

been produced to help anybody involved in a PRINCE 2 controlled project to understand

the approaches used in the Method.

This re-print incorporates the additional material included in the new manual – “Managing

Successful Projects with PRINCE 2” published in October 1998.

The book aims to fill the gaps present in the PRINCE 2 Method – in order to do thiscertain assumptions have been made and these are based upon my own experience and

understanding of the practical use of PRINCE.

I hope you will not only find this publication of practical use in managing your projects

but will also enjoy reading and learning from it. If you have any questions or observations

about the content of this publication, please contact me at SPOCE Project Management

Limited direct at (UK +44) 01202-780740 (Telephone & fax) or E-Mail [email protected]

Ken BradleyFebruary 1999

Who This Publication Is Intended For

PRINCE 2 is the UK Government standard for managing large projects and has been

widely adopted as the standard for project management for all types of projects within theprivate and public sectors. PRINCE 2 was officially launched on 1 October 1996.

The book is aimed at Project Managers, project management staff, and anyone needing toorganise, plan and control an undertaking using a structured project management

approach.

Although primarily a summary and interpretation of the PRINCE 2 project managementmethod, this publication provides an excellent start point for anyone wishing to understand

the principles and use of structured project management in any activity. It is also an

invaluable aid for anyone wishing to take the CCTA/APMG PRINCE 2 examinations.


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UNDERSTANDING THE

BACKGROUND

TO THE PRINCE METHODOLOGY

Chapter 1


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Origins of the PRINCE 2 Method

The PRINCE Methodology is a development of the PROMPT Methodology (Project

Resource Organisation Management Planning Technique) originally formulated in the mid

1970s. A private sector company, Simpact Systems Limited, evolved the PROMPT

Methodology to provide a suitable framework within which to manage the strategy,

feasibility study, development and support of Information Technology systems through astructured project management approach.

The PROMPT Methodology

The PROMPT Methodology comprised five major components:

♦ PROMPT I - Strategic Planning

♦ PROMPT II - System Development

♦ PROMPT III - Operations, Maintenance and Enhancement

♦ QSTAR Quality Assurance

♦ PROMPT Software Support Tools (The PROMPT Aids).

Government PROMPT

In the early 1980s, the UK Government published a requirement for a project

management method to improve the management and control of government IT projects.Many different methods were proposed and evaluated, and the contract to license the use

of the Method was awarded to Simpact Systems Limited.

CCTA (Central Computer and Telecommunications Agency) acting for the UK

Government commissioned some changes in the basic methodology. Chief amongst these

was the incorporation of the quality assurance aspects into the PROMPT II Methodologyto provide a product that was to become referred to as “Government PROMPT”.

Although CCTA licensed all the PROMPT Methodology, PROMPT II was the only

element fully implemented.

The belief was that Government Departments were already well supported in the

production of strategic plans, and that maintenance and enhancement aspects would be

easily handled providing development systems were properly supported by developmentand quality assurance documentation. PROMPT II was therefore considered to be the key

ingredient for success. Government PROMPT, incorporating PROMPT II principles only

was introduced into the major UK Government Departments in Spring 1983.


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The Standard PROMPT Lifecycle

Government PROMPT had a number of deficiencies from the start; for instance, a pre-

defined lifecycle provided the backbone for a PROMPT II project, but this caused someproblems with its view that IT projects broke down into standard stages of work

addressing Initiation, Specification, Design, Development, Installation, and Operation.

Many projects did not conform to this formula and inconsistencies were encountered.

Figure 1: The PROMPT Standard Six Stage Lifecycle

PROMPT Organisation - Stage Managers

The PROMPT II Method made no mention of Project Managers, instead relying on a

series of Stage Managers, each responsible for a pre-defined stage within the standard six

stage lifecycle.

The philosophy was that this left the way open to appoint the most appropriate individual

to manage each Stage of the project. The Specification Stage managed by aUser/Customer, the Design Stage by a Designer/Analyst, the Development Stage by a

Technical Programmer and the Installation and Operation Stages by User/Customers.

The Initiation Stage was typically managed by someone with sufficient technical expertise

to understand and plan the whole of the project.

Initiation Specification Design Development Installation Operation

The PROMPT II “Planning” Stages The PROMPT II “Action” Stages


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Figure 2: The PROMPT Organisation Structure

PROMPT Planning

The Government PROMPT Methodology also made no mention or use of Critical Path

Analysis, which was used extensively in major projects. In practice these omissions didnot cause real problems as training courses and consultancy support filled the gaps.

However the methodology was perceived as being not quite complete, or indeed, relevant

to many projects.

The Enhancement Project and PRINCE

During 1987, CCTA determined to update the Methodology by reflecting the actual usage

of PROMPT II and by introducing modern project management ideas. These elements

were Product-based planning, formal Project Initiation procedures, a Project Manager role,

sharper focus on Quality Management, and Open Life-cycle planning.

Leading consultancy companies in project and quality management were contracted to

work with the PROMPT User Group and CCTA to incorporate the changes.

Senior Management - Strategic Direction

The Project Board

Senior User Senior Technical Executive

Project Assurance Team

* Business Assurance Co-ordinator

* Technical Assurance Co-ordinator

* User Assurance Co-ordinator

Stage 3 Manager

Design

Stage 1 Manager

Initiation

Stage 5 Manager

Installation

Project Resources & Development Teams

Stage 4 ManagerDevelopment

Stage 2 ManagerSpecification

Stage 6 ManagerOperation

Assurance

Work Direction Administrative Support


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CCTA were keen to place the enhanced method into the public domain, as an openmethod, in order to enable suppliers of major IT systems (and their component parts) to

adhere to consistent standards when fulfilling UK Government contracts.

The overall objective was to provide a high-level of consistency throughout governmentprojects and to improve project management generally.

Meanwhile, LBMS (Learmonth & Burchett Management Systems) a major managementconsultancy company, who had developed SSADM (Structured Systems Analysis and

Design Methodology) under a CCTA contract, had acquired the PROMPT products and

name from Simpact Systems (which had ceased its commercial operations) and waslicensing the methodology successfully to the public and private sectors.

LBMS obviously could not agree to an enhanced version of PROMPT II being placed in

the public domain in direct competition with their own proprietary method, andnegotiations provided that the enhanced method be re-named PRINCE (Projects in

Controlled Environments) to meet this point.

PRINCE was introduced in April 1989 with full documentation and formal entry into the

public domain in January 1990. The PRINCE Methodology is now the UK Government

Standard for managing major projects. It has been widely adopted by private sectorcompanies both for use in government projects, and in many cases for their own internal

use. CCTA, with its collaborative partners (The Association for Project Management

Group, IBM UK Limited, and The Stationery Office) continues to pursue the acceptance

of PRINCE as “best practice” project management within the UK, Europe and worldwide.

PRINCE 2 and Other Developments

PRINCE 2 has now been developed, funded by CCTA and following extensive

consultation with users and organisations over a two year period. PRINCE 2 is “Process-

driven” (ie “what” and “why” but little in the way of “how”) addresses a wider base of

projects (IT and non-IT), Programmes of Work, Smaller Projects, Customer:Supplier:issues and introduces changes to the PRINCE version 1 Organisation component.

PRINCE 2 was formally launched by CCTA in London on 1 October 1996.

CCTA are working in collaborative partnership with a number of organisations (IBM

(UK), The Stationery Office and the Association for Project Management Group) to

promote PRINCE. One of the partners, IBM (UK) Limited, has developed a softwaresupport product based on their existing Process Integrator application, which provides a

full PRINCE 2 Environment, enabling the launch of specific software for planning, word-

processing and other office applications.

The package is particularly useful for managing the myriad of project documentation that

has to be created, updated, tracked and managed during the life of a project.

With PRINCE 2, CCTA has launched an accreditation and certification scheme providing

a vehicle for assuring users of PRINCE 2 that training and consultancy providers are

registered as competent and that training courses reflect a common syllabus with

examinations and certification at its conclusion.


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CCTA continue to support and develop the PRINCE 2 Method and a contribution is levied

from all those taking the APM Group Professional Examinations and registering as trained

PRINCE 2 Practitioners.

Future plans include companion volumes covering the “softer” aspects of project

management (leadership, delegation, appraisal etc) and Programme Management, Risk

Management, including examinations on these topics.

Further information can be obtained from CCTA Information Services on telephone:

(UK +44) (0)1603 704787


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Chapter 2

UNDERSTANDING THE BASICS


25

Introduction to PRINCE 2

PRINCE (PRojects IN Controlled Environments) is a structured method for effective

management of any size or type of project. It is the standard method for use in UK

Government Departments and is widely used in the private sector, NHS and Local

Government. A growing number of overseas Governments and multi-national companieshave adopted the method, or integrated it within their existing project management

approaches. The Method is being promoted actively by the APM Group (APMG) as a

“Best Practice” project management approach.

Benefits of PRINCE 2

There are a number of benefits to be gained from introducing and using a structured

approach to project management; among the benefits of using PRINCE 2 are that it:

♦ identifies management, technical (specialist) and quality Products or Deliverables and

helps ensure that they are produced on time and to budget;

♦ focuses attention on the quality of Products or Deliverables;

♦ separates the management and technical/specialist aspects of Organisation, Planning

and Control;

♦ facilitates control at all levels;

♦ makes the project’s progress more visible to management;

♦ provides a communication medium for all staff working on the project;

♦ ensures that work progresses in the correct sequence;

♦ involves senior management in the project at the right time and in the right place;

♦ allows the project to be stopped and, if required, re-started completely under

management control, at any time in the project’s life;

♦ is in the Public Domain and requires no license fee;

♦ has a well established User Group dedicated to the support, promotion and

strengthening of the method.


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The Structure Of A PRINCE 2 Project

Within a PRINCE 2 project environment, each project which is undertaken must:

♦ address all the processes concerned with establishing an effective project management

environment;

♦ have a stated business case indicating the benefits and risks of the venture;

♦ demonstrate a properly defined and unique set of Products or Deliverables;

♦ have a corresponding set of activities to construct the Products or Deliverables;

♦ identify appropriate resources to undertake the activities;

♦ have a finite life-span; suitable arrangements for control;

♦ identify an organisation structure with defined responsibilities;

♦ include a set of Processes with associated techniques which will help plan and controlthe project and bring it to a successful conclusion.

A PRINCE 2 project is divided into a number of Management Stages, each forming a

distinct unit for management purposes. Like the project, a Stage is driven by a series ofProcesses, has a defined set of products and activities, a finite life-span, control elements,

and an organisational structure. The delivery of these products, to the agreed quality

standards, marks the completion of the Management Stage. PRINCE 2 defines:

♦ the organisation of the project and its stages;

♦ the processes which drive the undertaking;

♦ the structure and content of the project plans;

♦ basic project management techniques;

♦ a set of controls which ensure that the project is proceeding to plan.

These, together with the products of the project and the activities which produce them, theproject business case, all encompassed within a Quality Management framework, make

up the PRINCE 2 environment.

All products of a PRINCE 2 project are filed within a defined structure - the

"Configuration". Management, Specialist and Quality Products are identified and filed

separately.

The PRINCE 2 framework provides the flexibility to set stage boundaries which are

appropriate to the needs of the project. Management Stage boundaries are chosen

according to:


27

♦ the sequence of production of Products/Deliverables;

♦ the grouping of Products into self-contained sets or associated Processes;

♦ natural decision points for review and commitment of resources;

♦ the risks and business sensitivity of the project;

♦ the completion of one or more discrete Processes.

The project stages correspond to the steps in the natural project life-cycle towards the

eventual outcome. Thus the stage boundaries are normally defined to correspond to the

completion of the major Products to be built and key decisions concerning commitment ofresources that need to be made. Whatever the nature of the project, it is advisable to

define one or more planning and/or definition processes in the early part of the project's

life. PRINCE 2 provides two Processes to cater for this - “Starting Up A Project (SU)”(where the early foundations for decision support are laid) and “Initiating A Project (IP)”

(where senior management are invited to commit to the undertaking and a baseline is

produced. The project is triggered by a “Project Mandate” which might take any form

from an informal request by a sponsor to a formal recommendation from a report.

PRINCE 2 recognises that few projects will be undertaken entirely in isolation. The

outputs from one project may be used as input by another project. There may be otherdependencies between projects, such as the use of shared resources. PRINCE 2, therefore,

provides a mechanism for defining the boundary of a project and its relationship to other

projects. A high-level context diagram is a useful mechanism for defining theserelationships.

Figure 3: Scoping Diagram showing Inputs and Outputs for the Project

The Scoping Diagram illustrated above is particularly useful when planning and managing

a Programme of Work where individual projects inter-relate with each other and it isnecessary to ensure that expected outputs from individual projects are anticipated and

planned for. When all individual project Context Diagrams are assembled to complete the

The Project Under

Development

Bullet List of the Main Functions

to be produced, developed or bought-in

Key User Groups

Central LogisticsProject

Business Processes Cleaned Data

Parts Requisitions

Current System

MIS Project

Information


28

programme “jigsaw” it will be apparent which outputs and inputs do not match, andappropriate action can be taken by the Programme Director/Manager.

The Key Elements Contained In PRINCE 2

To understand the content of the PRINCE 2 Project Management Method, the following

model showing the key elements should be studied:

Figure 4: Summary Model of the PRINCE 2 Method

The PRINCE 2 methodology applies three key elements to each project and to the

Management Stages within a project. These are summarised in the above Model and

described, briefly, in the following tables. The three elements are the Processes whichdrive the project management, Components and Techniques, which are used by each of the

Processes to effect the management of the project.

PROCESSESTECHNIQUES COMPONENTS* Starting Up A Project (SU)

* Initiating A Project (IP)

* Directing A Project (DP)

* Controlling A Stage (CS)

* Managing Product Delivery (MP)

* Managing Stage Boundaries (SB)

* Closing A Project (CP)

* Planning (PL)

* Product-Based Planning

- Product Breakdown

- Product Description

- Product Flow Diagram

* Quality Reviews

- Preparation, Review, Follow-up

* Change Control - Capture, Logging,

Assessment, Decision

* Project Filing Structure

- Management File

- Specialist File

- Quality File

+ Existing Organisation

Techniques already used

within the host organisation

* Organisation

- Structure & Role Descriptions

* Planning - Products, Activities, Resources

* Controls

- Management, Team, Quality

* Stages

- Management & Technical Stages

* Management of Risk

- Risk Assessment & Management

* Quality in a Project Environment - Quality Requirements & Response

* Configuration Management

- Tracking Products & Documentation

* Change Control

- Capture & Assessment

PRINCE 2 SOFTWARE SUPPORT ENVIRONMENT

EXPERIENCE, BEST PRACTICE, COMMONSENSE

ORGANISATION STANDARDS & APPROACHES; BUSINESS STANDARDS & ETHICS

QUALITY MANAGEMENT SYSTEM (QMS) (ISO9001)

THE BUSINESS CASE * Business Benefits

RISK MANAGEMENT * Risk Analysis & Actions

* Risk Management


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The PRINCE 2 Processes

DESCRIPTION REF EXPLANATION

Starting Up A Project SU Establishes the Objectives and Approach to the

Project; Set up the Project Management Team;Plans for the Initiation Process. This is a pre-

project Process, which looks to answer the

question “do we have a worthwhile and viableproject?” before asking for commitment of

resources to set up a project environment.

Initiating A Project IP Plans the whole Project in terms of its Products,

Activities, Resource Usage and Quality; Setsthe baseline for the Business Benefits & Risks.

Directing A Project DP Provides Authorisation for work to be carried

out and Resources to be committed.

Authorisation for Project Initiation and ProjectClosure and, in some cases, its premature

termination. The Process is “owned” by the

Project Board – the ultimate authority for theProject - accountable for its overall success.

Controlling A Stage CS The basic day-to-day project management

Process - authorising work to create or change

Products (or Deliverables), collecting andreflecting “actuals”, assessing progress and

reporting to senior management. Capturing

proposed changes and errors and escalating

these, where appropriate to management.

Managing Product Delivery MP The main “workshop” for the project where the

majority of resources are consumed. This

Process is where the Products of the Project arecreated. Progress reports (Checkpoint Reports)

are provided to the Project Manager. Quality

Review and Delivery of Products occurs here.

Managing Stage Boundaries SB Reporting on the achievements of the CurrentManagement Stage and the impact on the

overall Project Plan and Business Case.

Planning the Next Stage (Products, Activities,

Resource Usage). Putting together ExceptionPlans when the Management Stage has suffered

a significant departure from its approved plan.

Closing A Project CP Preparation for closing the Project in an orderlyway. Customer sign-off, preparation of an End-

Project Report and identification of Lessons

Learned and Follow-on Recommendations.

Planning for a Post-Project Review.

Planning PL Used by all the other Processes - a common-to-

all Process featuring the design of the plan and

its creation.


30

The PRINCE 2 Components:

DESCRIPTION USED

BY

EXPLANATION

Organisation SUSB

Organisation Structure + Role Descriptions.Predominantly used in the “Starting Up A

Project” Process where the Executive and

Project Manager are appointed in the firstProcess, and the Project Management Team is

designed and appointed. The Project

Management Team is reviewed at the end of each

Management Stage within “Managing StageBoundaries”.

Planning SU

IP

CSMP

SB

CPPL

DP

All Processes use the Planning Component. The

Initiation of the project is planned during

“Starting Up A Project”; the project itself isplanned in “Initiating A Project”; Stage plans

are prepared in “Managing Stage Boundaries”;

and Product planning is carried out in“Controlling A Stage” and “Managing Product

Delivery”. Follow-on actions, including

preparation of a Post-Project Review Plan are puttogether in “Closing A Project”. “Directing A

Project” uses the approved plans throughout to

confirm the required progress.

Controls SUIP

CS

MP

SBCP

PL

DP

All the Processes use the Controls Component.The “control” Processes which make particular

use of this Component are “Initiating A Project”

(which sets up the overall project control

structure); “Controlling A Stage” (which usesCheckpoint Reports to capture progress, and

records actual usage of resources. Highlight

Reports are used to inform the Project Board ofprogress); “Managing Product Delivery”

generates Checkpoint Reports for control

purposes. Stage approval is handled by“Managing Stage Boundaries” where

Management Stages are approved via End Stage

Assessments. This Process also uses Exception

Reporting and Planning to control significantdepartures from plan. “Directing A Project” is

the Process within which overall authorisations

are made; this Process uses the key controls ofEnd Stage Assessment, Tolerance, Project

Initiation and Project Closure.


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The PRINCE 2 Components (Continued)

Stages IPSB

CS

DP

Management Stages provide the key control forthe Project Board and are mainly used by

“Directing A Project” when authorising

commitment for expenditure. Technical Stages

often overlap and run in parallel; ManagementStages may not. The key control Processes use

Management Stages in planning and control of

the project.

Management of Risk SUIP

SB

DP

Risk Analysis is carried out initially in “StartingUp A Project” when the Project Brief is created.

This is refined in “Initiating A Project” where

the Business Case for the project is established.

The Risk Analysis is updated during “ManagingStage Boundaries” to provide the basis for

decision support for the Project Board when they

review the project at the End Stage Assessmentin “Directing A Project”. No specific risk

analysis tools or techniques are recommended.

Management of risk has close ties with the

Business Benefits which are measured and

presented as the Business case for the project.

Both the Business Case and the Risk Analysisare up-dated, minimally, at the end of each

Management Stage.

Quality In A ProjectEnvironment

SUIP

CS

MP

PL

The Customer’s Quality Expectations are firstidentified in “Starting Up A Project” and quality

aspects are planned in “Initiating A Project”.

When the project is approved, “Controlling A

Stage” and “Managing Product Delivery”enable specific Quality Criteria to be set for each

Product or Deliverable via Product Descriptions

described in the “Planning” Process.

ConfigurationManagement

IPCS

MP

CP

Configuration Management addresses the propersafeguarding and management of Products or

Deliverables and their associated documentation.

“Initiating A Project” sets up the Project Filesand “Controlling A Stage” and “Managing

Product Delivery” executes the Configuration

Management arrangements. Project Files arearchived in “Closing A Project” mainly for audit

purposes.

Change Control CS Managing proposals for change is an important

aspect of project management and the Process“Controlling A Stage” is where such proposals

are captured.


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The PRINCE 2 Techniques

DESCRIPTION EXPLANATION

Product-Based Planning A “Product Breakdown Structure” which identifies the

Products or Deliverables to be produced during the project.A “Product Description” for each Product identified in the

Product Breakdown Structure, which defines and specifies

each Product; a key feature of the Product Description is theQuality Criteria used to ensure that the Product is indeed a

“Quality Product” that conforms to its requirements. A

“Product Flow Diagram” which shows the relationship that

each Product has with others and external entities; theProduct Flow Diagram must “balance” with the Product

Breakdown Structure.

Quality Review Technique Used for measuring a Product or Deliverable against its

published Quality Criteria. PRINCE 2 recognises InformalQuality Reviews (typically “Desk Checks”, Tests or Visual

inspections) and Formal Quality Reviews (which are more

structured “Walkthroughs” of a Product or Deliverable).Formal Quality Reviews comprise three distinct Phases -

Preparation, The Review Meeting and Follow-Up.

Change Control Every project must be able to accommodate changes

required by the customer or anyone else who has an interestin the project’s outcome. All suggested changes, identified

errors and departures from the agreed Specification must be

captured as “Project Issues, logged, analysed for technical,customer and business impact, and a decision made on

whether to accept or reject the Issue.

Project Filing A suitable filing structure is suggested; this comprises a

“Management File” made up of one Project File and a seriesof Stage Files - one for each of the Management Stages of

the project. A Specialist File housing the documentation

relating to the technical aspects of the project and a QualityFile housing the Quality Review documentation and the

Project Issues complete the structure.

More on the PRINCE 2 Processes

The eight major Processes state the minimum content that can be expected to be found in

a PRINCE 2 compliant project. Exactly how the Processes are addressed within anyproject is the responsibility of the organisation’s senior management, represented by the

Project Board, and the Project Manager, but the method requires that each of the eight

Processes is reflected within the project one way or another.

All the Processes link to Components and Techniques some of which are described within


33

the method. It is anticipated that most organisations will already be using some specificTechniques and might wish to incorporate additional Components reflecting their business

environment and culture. PRINCE encourages this where they provide value to the

management decision making process.

Each Process is defined in the following terms:

♦ The Fundamental Principles that underpin the Process;

♦ The Context within which the Process operates;

♦ An Overview of the Process;

♦ Responsibilities identifying accountability for the Process;

♦ The Information Needs required for the Process to function effectively;

♦ The Key Criteria which will influence the success or failure of the Process;

♦ Hints and Tips for carrying out the Process in the best way.

♦ Major Processes have an additional “Scalability” heading to help with scaling down

each Process for smaller, lower risk projects, where this is required by senior managers.

The Process-based approach is a powerful feature in PRINCE 2 and is the area which most

differentiates it from version 1 of the method. The flexibility of the method is, however,underlined by allowing implementing organisations to choose their own destiny in terms

of identifying how to meet the requirements of any given Process. In most organisations

already operating successful project management systems there will be little need to makechanges to the way they are operating, provided effective project management procedures

are already in place.

The Organisation Component

The organisation and effective use of people assigned to manage a project needs to be

considered from the view point both of the specialist skills they bring to the project and

their individual personalities.

Responsibilities need to be defined within a team structure to ensure that management is

both efficient and responsive, and that individuals understand exactly what is expected of

them. Within PRINCE 2, responsibilities are defined in terms of roles, rather thanindividual’s jobs. Assignment of roles to individuals is a decision for each Project Board

to take in the light of organisational circumstances, and the same individual may be

assigned to more than one role, or to different roles at different stages of the project.

Three roles/interests must always be represented on any PRINCE 2 project – Business,

User, and Supplier.


34

Corporate or Programme Management

The Project Board

Senior User Senior Supplier Executive

Project Assurance

Project Manager Project Support

Team ManagerTeam Manager Team Manager

Project Resources & Teams

Figure 5: The PRINCE 2 Organisation Structure

The Project Board

Every PRINCE 2 project will have a Project Board appointed. The Project Board is the

ultimate authority for the project and is normally appointed by Corporate or ProgrammeManagement to take overall responsibility and control of a PRINCE 2 project. The Project

Board consists of three senior management roles, each representing major project interests.

♦ Executive: appointed by Corporate/Programme Management to provide overallproject guidance and assessment throughout. The Executive represents the interests of the

Customer and the Business and has overall responsibility for the project.

♦ Senior User: representing users (and, where appropriate, Customers) of the outcomeor the major products from the project.

♦ Senior Supplier: representing areas which have responsibility for providing thespecialist “know-how” and/or committing Supplier resources for the solution. The Senior

Supplier might be drawn from an external, commercial, organisation or from internal

sources responsible for delivering the specialist “End Product” to the customer (or a

mixture of both).


35

There is a requirement within the Method to have a Project Board function and this cannot

be eliminated or delegated (although the terminology may be changed to suit the

organisation’s culture, for example “The Project Authority”). The Project Board’s

accountability for Project Assurance cannot be delegated although the day-to-day work ofProject Assurance can if Project Board members do not have the time or expertise to carry

out the tasks involved.

The Project Manager

A Project Manager will always be appointed to assume day-to-day responsibility for

planning and management of the project throughout all its Management Stages. The

Project Manager takes direction from the Project Board and is responsible for managing,

on behalf of the Project Board, the Processes, planning and delivery of Products for the

project, on-time, within budget, meeting the specialist/technical and quality criteria agreedwith the Project Board.

As with the Project Board, the role of Project Manager is a required role within theMethodology and cannot be shared, delegated or eliminated.

The Team Manager

In a large or complex project, one or more Team Managers may be assigned the

responsibility for ensuring that the products of one or more particular Technical, or

Specialist, Stages of work are planned, controlled and produced on schedule, to thedefined and agreed quality standards, and within budget.

Figure 6: Project Manager and Team Manager Relationships

The Team Manager role is optional and will only be present in large projects or where the

Project Manager lacks the specialist skills to plan and control specific parts of the project.





36

Project Resources and (Specialist) Teams

The Project and/or Team Manager have responsibility for Teams of specialist staff, tasked

to carry out the activities and produce the Products of the stage. The team organisation,

responsibility definitions and the allocation of these responsibilities to individuals will

depend upon the size and nature of the project and the skill mix available. PRINCE 2recognises the need to establish Team Manager roles where appropriate;

Project Assurance

PRINCE 2 separates the Project Assurance function from the Project Support function.

The Project Board have responsibility and accountability for Project Assurance.

Depending on the size, scope, risk and profile of the project, and their own knowledge,skills and time available, they may choose to delegate responsibility for overseeing day to

day Project Assurance to others within the organisation. However, accountability for

Project Assurance rests with the Project Board and they are not able to delegate this.Project Assurance may not be delegated to the Project Manager or to Team Managers.

Figure 7: Project Board and Project Assurance Functions

Although not specifically separated out in the PRINCE 2 Method, Project Assurance can

be found in two distinct forms:

♦ External Assurance to confirm that the project is following overall and corporate

standards (eg the published Quality Management System, or particular accounting

conventions) and the organisation can be expected to have an audit function already inplace to check these aspects.

♦ Internal Assurance to verify that the project is delivering Products or Deliverables

that meet the agreed Quality Criteria and that internal project standards are being

followed. Internal Assurance is ultimately the responsibility of the Project Board.

The Project Board


Project Assurance

User Assurance Specialist Assurance Business Assurance


37

Project Support

Within PRINCE 2, Project Support, on a formal basis, will only exist where there is a

perceived need for it. A Project Manager may well find that the Project Board see no

scope for any administrative support, and that any day-to-day assistance might need to be

on an “ad-hoc” basis.

Figure 8: Project Manager and Project Support Relationships

Where a project does warrant the appointment of a Project Support function, the

individual(s) selected will report directly to the Project Manager. Incidental support for

the Team Managers, where appointed, and Team resources will normally form part ofProject Support’s responsibilities.

The Project Support Office

A Project Support Office might well evolve in a Programme or multi-project

environment, to support a number of individual projects. The methodology supports the

possibility of a transition from several Project Support individuals to a central ProjectSupport Office where the number of projects under development warrants it. The resultant

Project Support Office will be able to provide a centre of expertise for all project

management aspects within the organisation/site, effectively delivering an internalconsultancy service where required by Project Board members, Project Managers and

project team members.

Summary of The Organisation Component

In the final analysis, it is the people who are responsible for the management of the

project and the creation of its deliverables who have its success in their hands. Clear

definition of responsibilities and a tenacious commitment to achieving agreed goals will

always be the predominant factor in success.

The PRINCE 2 Method must always be tuned to suit the implementing organisation’s

existing standards, business approaches, culture and people; the latter two are arguably

the most important.



38

PRINCE 2 Planning

Estimating, planning and re-planning are constant and key activities when managing any

project. PRINCE 2 provides a structure for preparing and maintaining plans at appropriate

levels throughout the life of a project. Plans are prepared for the Project as a whole, for

each stage within the project and, optionally, for the teams’ work within eachManagement Stage. There is also an Exception Reporting and Planning process to handle

divergences from the original plan. The PRINCE 2 method include a Technique for

Product-Based planning incorporating Activity planning, Resource reporting and Qualityplanning.

Products or Deliverables and Related Activities

PRINCE 2 provides a set of planning techniques which give structure to the project. The

key to PRINCE 2 planning is the identification and definition of the Products required.

From this comes an analysis of the work (ie the activities) required to generate these

products, and the sequencing of the work.

PRINCE makes a distinction between Management Products and Activities, Specialist

Products and Activities, and Quality Products and Activities. This is partly because these

are usually the concern of different groups of people, but also to ensure that managementactivities are not overlooked in planning and estimating.

Figure 9: PRINCE 2 Plans Structure

Plan

Text

The Plan Text provides a high-level, overall view of

the plan, summarising its key features

Product

Breakdown

Structure

Identifying the Products/Deliverables that will be

produced by the Project. The Products will be categorised

under the headings of “Specialist”, “Management”, and

“Quality” Products.

Product

Descriptions

Describing the Products/Deliverables that will be

produced by the Project. There is a prescribed format

for Product Descriptions

Product

Flow

Diagram

Describing the relationships that exist between

each Product/Deliverable, and external entities.

PERT

or

Activity

Network

Showing the relationships that extist between the Activities that will be undertaken

to create the Products identified in the Product Breakdown Structure.

Gantt

or

Timescale

Plan

Derived from the PERT Network, this shows when Activities are

planned to start and end. Major Review points (End Stage

Assessments) are also shown on this plan.


39

Management activities are concerned with planning, monitoring and reporting the work ofthe project, in both normal and exceptional situations. They produce Management

Products in the form of plans, reports and other control documents. Management activities

include the planning and control of all specialist activities on the project. Although

influenced by the specialist content, a similar pattern of management tasks can beexpected to be present in any PRINCE 2 project.

Conversely, the Specialist activities undertaken by a project are determined entirely by thescope and objectives of the project. The Specialist activities describe the work needed to

produce the Specialist Products required from the project.

The Specialist Products required by the user/customer are identified and defined at the

start of the project by the Project Manager and accepted by the Project Board. Additional

Specialist Products may be defined by the strategy appropriate to a particular Management

Stage of the project; specialist activities may also be prescribed by an organisation’s ownparticular technical strategy. PRINCE 2 therefore acknowledges the need for flexibility in

the selection and definition of Specialist activities and the corresponding Products.

Figure 10: Management, Quality and Specialist Products (For A Typical Feasibility Study)

Quality activities may be performed by anyone who is able to make a contribution to the

Product under review. Individuals within the project and host organisation as well aspeople external to the organisation are all appropriate. Quality activities must be planned

for early in the life of the project.

The PRINCE 2 Product planning techniques require every project to be described and

Completed Feasibility Study

Specialist Products

FS 01 - Business reviewFS02 - Problem Definition

FS03 - Options Identified & Agreed

FS04 - Options Appraised

FS05 - Selected Option AgreedFS06 - Final Report

Quality Products

QP01 - Product Descriptions

QP02 - Quality Review Documentation

QP03 - Project Issues Log

QP04 - Quality LogQP05 - Configuration Management

Management Products

MP01 - Project Initiation Document

MP02 - Stage Plans

MP03 - Lessons Learned LogMP04 - Risk Log

MP05 - Business Case

MP06 - Product Checklist

MP07 - Highlight ReportsMP08 - Project Start Notification

MP09 - Project End Notification

MP10 - Project Filing Structure

The Project Management

Standard for the

Project

The Quality Management

Standard for the

Project

The Technical Management

Standard for the

Project


40

defined in terms of its Products or Deliverables. This is a very effective way to ensure fullunderstanding of what is required and to ensure that, as far as possible, all resource

consuming activities are related to one or more required Products.

Planning for the Delivery of Specialist Products

PRINCE 2 Plans are concerned with the Products to be delivered and with the activities

necessary to ensure that these Products emerge on time and to the required quality

standards.

The project Products are identified as a first step in Product-Based Planning; definition of

each product (via the PRINCE Product Description) allows its make-up and quality

requirements to be documented and properly understood. A Product Breakdown Structure

illustrates the hierarchical make-up of the complete set of project products and a ProductFlow Diagram provides a view of the relationship each product has with others, within and

outside of the project.

Figure 11: Product Flow Diagram (For A Feasibility Study)

The Project Timescale or Gantt Plan charts the major activities of the project. It is usually

derived from the PERT (Programme Evaluation and Review Technique) or ActivityNetwork which shows the relationships that exist between project activities. It is used in

conjunction with a Project Resources Report to monitor progress on the project as a whole.

It also addresses planning requirements related to Quality Control and Configuration

Management. A Stage-level Gantt (or time-scale) Plan shows the products, activities andquality controls for each stage of the project. The Stage-level Gantt Plan is produced and

approved at the end of the previous stage (the plan for the first stage is prepared with the

project plan).

FS01

Business Review

FS02

Problem Definition

FS03

Options Identified& Agreed

FS04

Options Appraised

FS05

Selected Option Agreed

FS06

Final Report

Strategy PlanSolution Providers


41

Additional, lower-level Gantt Plans can be expected to exist in most projects, to give a

detailed breakdown of particular major activities These are termed “Team Plans”.

Initiate

Specify

Design

Build

Test

Train

Handover

Management

Stage 1

Management

Stage 3

Management

Stage 2

Figure 12: Gantt Plan (Time-scale Plan)

Lower level Plans (or Individual Work-to Lists), if required, are derived from the Stageand Team Plans to allocate detailed activities (and Products/Deliverables) to particular

members of a Specialist Stage Team. Although this level of plan is not formally included

in PRINCE 2 they may be utilised if the size and/or complexity of the project requirestheir production.

Resource Planning & Reporting

Resource requirements are concerned with managing the funding and effort resources of

the project. Specific resource plans are not produced for PRINCE 2 controlled projects, as

the method assumes that a software planning tool will be used. Where this is the case,relevant reports on planned and actual resource usage can be drawn from the Project Plan

in the form of a “Resources Report” as and when required.

Where a software support tool for planning is not in use (for example in the case of a lowcost, short duration, low risk project) the format for a resources plan or report shown in

figure 13 may be of use. Even where a software planning tool is in use, the presentation of

the information might well benefit by adopting the format shown in figure 13 as it reflectsthe type and level of information required by the Project Board in reaching a suitable

business decision.

It is the decision-support information about the requested commitment of resources that is

of most use to Project Board members in reaching their decision to start or continue with

the project and careful thought must be given as to the most appropriate presentation of the

data.


42

Figure 13: Typical Project Resources Report (or Plan)

The standard Resources Report drawn from any software-driven Project Plan will identify

the type, amount and cost of the resources required by the project related to each

Management Stage of the work. It will also identify equipment, building, and fixed-pricecosts associated with the project. The intention is to provide a complete resource and

financial picture of the undertaking.

A more detailed Resources Report, at Management Stage Level identifies the resources

required by the particular stage. It defines the budget required by the stage and is used to

report actual expenditure and resource usage against plan More detailed Resource Plans atthe Team Level will be produced when required, to plan and control a particular major

activity, and the associated team work-plans and Products.

Quality Planning - BS/EN/ISO9001

Action must be taken at project planning time (within the “Initiating A Project (IP1)”

Process) to ensure that the project can deliver its Products to the required quality standards(the Customers Quality Expectations) required by the customer. Quality Criteria must be

defined and agreed, and incorporated into a Product Description for each major Product

identified; a Project Quality Plan must be defined, published and adopted; Quality

Review procedures must be established and staff trained; review activities must beproperly resourced. Whatever action is proposed to build quality into the project, the

measures must be consistent with any published Quality Management System (QMS) that

is already in effect.

PRINCE 2 has been designed to comply with the BS/EN/ISO9001 Quality Management

Standard and the method contains a section relating its content to each section of the ISOStandard. BS6079, the Project management Standard, is also reflected within PRINCE 2.

ISO9001, BS6079 and PRINCE 2 are all Process-driven; the foundation for quality and

Stage 1 Stage 2 Stage 3

Plan Actual Plan Actual Plan Actual

EFFORT (Staff Weeks)Skill Types

Customers

EngineersIT Analysts

Others

COSTS (£K)Skill Types

Customers

EngineersIT Analysts

Others

Equipment

Fixed Price Elements

Total Stage Costs

Total Project Costs


43

effective, modern project management is therefore integral and inherent in PRINCE 2.The results of the quality planning activity must be integrated into the timescale and

resource plans at each level. Just as quality must be built into the Products, so must

quality control be built into the plans.

Figure 14: PRINCE 2 Planning Levels - Project, Stage & Team

♦ The Project Level plan (required) sets the overall quality approach for the entireproject. It defines the standards to be followed and the quality criteria for the major

products. It also identifies external constraints that may apply to the project, such as a

specific Configuration Management Method.

♦ The Stage Level plan (required) identifies the quality criteria, methods and review

guidelines for each Product produced during the stage.

♦ A Team plan (optional) might be required for specific individual activities such ascarrying out interviews within a particular user/customer area.

The Project Manager is responsible for deciding whether any plans below stage-level are

required; this decision will be endorsed by the Project Board at the Project Initiation orEnd-Stage Assessment meeting.

Tolerance and Planning

The Project Board Executive sets tolerances for Stage Plans. These define the limits of

time-scale and cost (or sometimes effort) within which the Project Manager can operate

without further reference to the Project Board. Tolerance is variable and will be assignedto each Management Stage to reflect the respective business risk, but a general rule of

Project Plan (Mandatory Plan)

Stage PlanStage Plan Stage Plan

Team

Plan

Team

Plan

Team

Plan

Team

Plan

Team

Plan

Team

Plan

Project Resources Report(Effort, Costs, Equipment, Direct Costs)


44

thumb is that Time Tolerance of plus/minus 1 week and Cost Tolerance of plus/minus10% is about right.

An Exception Report and, subsequently, if required by the Project Board, an Exception

Plan, is produced in situations where costs or time-scales are forecast to be exceededbeyond the tolerances set by the Project Board.

The Exception Report describes the cause of the deviation from plan and its consequencesand recommends corrective action to the Project Board. Once considered and approved by

the Project Board at a Mid-Stage Assessment (MSA), the Exception Plan replaces the re-

mainder of the current Stage Plan.

The Controls Component

Regular and formal monitoring of actual progress against the approved plan is essential to

ensure the timeliness, cost control and quality of the system or undertaking being

developed. PRINCE 2 provides a support structure of Management and Product-oriented

controls to monitor progress, supported by a reporting procedure which enables re-planning or other appropriate corrective action to be taken.

Management Controls

PRINCE 2 provides a structure of management controls to be applied throughout the

project. These controls cover all aspects of project activity and, at the highest level, allow

the Project Board to assess project achievement and status prior to committing furtherexpenditure.

Controls are applied through measuring the progress towards production of a set ofpre-defined outputs (Products or Deliverables). The overall structure of Management

Controls is defined during the project Initiation Stage (“Initiating A Project (IP4)”

Process) to ensure that the project is set up with clear Terms of Reference, incorporating

agreed and measurable Objectives and an adequate management control structure.

Project Initiation

To document a firm foundation and to provide a positive start to the project, ensuring that

the terms of reference, objectives, plans and controls, business risks, benefits and financial

return, organisation structure and job definitions are clearly defined, published, understood

and agreed.

This Management Product is very important to the project and is the result of two

Processes - the pre-project “Starting Up A Project (SU)” and “Initiating A Project (IP)”.The key output is the Project Initiation Document (PID) which, when approved by the

Project Board, is a “frozen” document used to baseline the project.


45

End Stage Assessment (ESA)

This is a required management control and occurs at the end of each stage. It typically

consists of a formal presentation to the Project Board of the current project status, and

reviews the overall business case (benefits and risks).

The approval of the proposed plans for the next stage is also obtained. Project Board

approval, with agreement by all the members, must be obtained before the project can

proceed to the next stage.

Stage 1 - Planning & Definition Stage 2 - Design & Contract

End Stage Assessment (ESA)“Directing A Project” Process•Review the Outcome of Stage 1;

•Review the Project Plans;

•Review the Business Case (Benefits & Risks);

•Preview the Plans for Stage 2.

•Endorse the Project & Approve continuation of

the project up to the next End Stage Assessment.

“Managing Stage Boundaries” Process •Up-date the Plans for Stage 1;

•Up-date the Project Plans;

•Up-date the Business Case (Benefits & Risks);

•Prepare the Plans for Stage 2

Figure 15: Handling End Stage Assessments

Mid Stage Assessment (MSA)

This Project Board control is held only to review a significant deviation from an

approved Management Stage Plan and to approve an Exception Plan produced, at the

request of the Project Board, following an Exception Report.

An Exception Report is produced by the Project Manager to alert the Project Board as

soon as it is apparent that a significant departure from the approved plan is forecast.

The Exception Report records what has happened to cause the “significant departure” from

the approved plan, the impact on the Management Stage, overall Project and its Business

Case. The plan will also recommend appropriate action to take the project to the end ofthe Stage and, where possible, recover the situation.


46

Figure 16: Handling Mid Stage Assessments

Tolerance

The measure of a “significant departure” is that the Tolerance stated by the Project Board

at the beginning of the management stage has been, or is likely to be, exceeded.

Tolerance may be thought of as the scope that the Project Manager has been granted by the

Project Board to move away from the approved Management Stage Plan without needing

to report the variance.

Tolerance is not time and money to be spent but should be thought of as “trigger” figures

which help keep the Management Stage (and the Project Manager) within “tolerable”bounds.

Responsibility for Tolerance stems from the Project Board, with the Executive having

responsibility for setting Management Stage Tolerance with the Project Manager. TheExecutive is also responsible for ensuring that an overall Tolerance is set for the project by

Corporate or Programme Management and that it is suitably recorded in the Project Brief

during “Starting Up A Project (SU)”.

Tolerance should always be set in terms of both time and cost, as over-concentration on

just one aspect will imbalance the overall project resulting in an unexpected and

unpredicted time or budget slippage.



“Directing A Project” Process•Consider theException Planat an unscheduled Mid Stage

Assessment.•Review the Problems with Stage1;•Review the Impact on the ProjectPlans;•Review the im[pact on the Business Case (Benefits &Risks);•Preview the revised Plans for the remainder of theStage.

•Endorse the Project & Approve continuationofthe Stage up to the next End Stage

Assessment.

“Controlling A Stage” Process•Deviation from approved Stage PlansForecast;•Exception ReportCreated - Reasons; Impact; Options;

Recommendation;•Direction from Project Board .... Create an ExceptionPlan;

“Managing Stage Boundaries” Process•Produce an ExceptionPlan


47

Figure 17: Tolerance - plus/minus 1 week; plus/minus 10%

Standard Tolerance in PRINCE 2 is measured in terms of Time (Schedule) and Cost.

There are other types of Tolerance which may be applied; these include Tolerance on

Quality, Technical Conformance, Scope, and Risk.

The level of Tolerance is decided by the Project Board and set by the Executive following

recommendations by the Project Manager. Tolerance is most usually applied to aManagement Stage but is also be applied at Project level (set by Corporate or Programme

Management) and Product level (set by the Project Manager in specific Work Packages).

Project Closure

A final review of the project's work is held, usually (but not necessarily) in the form of a

Project Board meeting. This is similar to a stage assessment but relates to the entire projectrather than a single stage. The objective is to ensure that all the project

Products/Deliverables have been satisfactorily delivered to their stated quality standard

and that the project documentation is complete.

A review of the project management standards and approaches used by the project will be

carried out within the “Closing A Project (CP)” Process and a Lessons Learned Report

produced for consideration by the Project Board. The Lessons Learned Report recordswhat has been learned from using the PRINCE 2 project management and quality

management standards for the project and is created during the “Initiating A Project”

Cost

Time

Planned Delivery & Total Cost

2 4 6 8 10 12 14 16 18 Weeks

£110K

£100K

£90

£80K

£70K

£60K

£50K

£40K

£30K

£20K

£10K

Plus 10% Tolerance

Minus 10% Tolerance

Plus 1 Week

Tolerance

Minus 1 Week

Tolerance

o

STAGE PLAN


48

process and “populated” as the project progresses (at the end of each Management Stage);it will eventually be sent to the organisation’s manager responsible for quality.

Recommendations will also be made for Follow-on Actions to record and trigger further

work which is recommended following the closure of the project. Follow-on Actions willusually be derived from any outstanding Project Issues, shown on the Issues Log.

A Post-Project Review Plan, to enable the organisation to check the actual realisation ofbenefits after the project’s output has been operating for a while (perhaps 9-12 months

following hand-over), will be prepared and authorised by the Project Board.

Highlight Reports

The Project Board is kept informed of the progress of the Management Stage (and the

project) against the approved plans via regular, time-related Highlight Reports. These areprepared by the Project Manager and are usually provided monthly, although their

frequency will always be agreed with the Project Board.

Highlight Reports are usually sent through the post or by e-mail; the objective is to

remove the need for unnecessary time-related Project Board meetings which consume the

Project Board members’ valuable time, while still keeping them abreast of significant

developments. The format for Highlight Reports will typically include:

♦ a statement of the progress made during the last (usually monthly) period;

♦ a statement of problems during the last period, and how they were handled;

♦ confirmation of the Activities and Products to be worked on during the next period;

♦ a statement of the financial and schedule situation for the overall project and the

current Management Stage.

Some organisations specify that Highlight Reports should be kept to one side of A4 (or its

equivalent). Where the project is part of a Programme of work, separate Project and

Programme Highlight Reports will normally be produced.

Stages

Stages are partitions of the project with decision points at their conclusion, and sometimes

during their life.

PRINCE 2 differentiates between “Management Stages” (which equate to the commitmentof resources by the Project Board and a decision to continue with the project and authority

to spend) and “Technical Stages” which comprise sets of technical activities leading to a

stated and required Product.


49

Initiate

Specify

DesignBuild

TestTrainHandover

ManagementStage 1

Management

Stage 2Management

Stage 3

TechnicalStages

Project Review of Management Stage at


Project Initiation Project Closure

Figure 18: Management & Technical Stages

Technical Stages will often overlap and be run in parallel; they are normally planned andmanaged by Team Managers who report to, and take direction from, the Project Manager.

Management Stages will always run in series.

In figure 18, some of the Technical Stages have been planned to run in parallel. Of course,

in a smaller project these might well be described as “Technical Activities”; in medium to

larger projects, the Activities will often combine to provide the Technical Stages under theimmediate control of a Team Manager.

In only the most exceptional circumstances will authority be given for work to commence

on the next Management Stage before all the Products of the current Management Stage iscompleted.

Business Benefits and Risk Management

PRINCE 2 places emphasis on the Business Benefits for the project; they are described

by the Method as “…the driving force behind the project …”. The purpose of the

PRINCE 2 Business Case is the identification and measurement of the Business Benefitsand the continued review of them as the project progresses through its Management

Stages. Closely associated with the Business Benefits are the Risks that the project faces;

essentially the risks divide into two main areas:

♦ Business Risks relating to threats associated with the project not delivering products

capable of achieving the claimed and published Business Benefits (eg legislative changes,

market changes, environmental issues).


50

♦ Project Risks which are concerned with the ability to deliver the project’s outcomewithin the required time and cost requirements (eg failure of third party suppliers, skills

shortages, technical problems).

The Method does not specify any particular way of measuring Business Benefits orassessing Risks but whatever the chosen approach, PRINCE 2 requires the Business Case

and Risks to be updated on a regular basis - minimally at the end of each Management

Stage. This provides the Project Board with sufficient, up to date, information on which tobase their decision to continue with the project.

Planning For Quality

PRINCE 2 presumes that the project will be managed under the umbrella of a published

Quality Management System (QMS) conformant to ISO9001. If such a QMS is notpresent the Method compensates by specifying that quality must be planned from the

outset. Planning Quality takes place in the “Initiating A Project (IP)” Process and the

resultant Project Quality Plan is incorporated into the Project Initiation Document (PID)and used throughout the project. The Process provides the following:

♦ it establishes a Quality regime for the project;

♦ it defines the overall project quality criteria and assurance arrangements to be

employed by the project;

♦ it establishes the approach to control of change during the project.

Responsibility for planning quality lies with the Project Manager, working in close

association with those responsible for quality (ie the Quality Manager).

Quality Controls - Quality Review

Quality controls are applied to specific products rather than to the overall output of a

stage or project. The aim is to identify and correct errors as early as possible in the

development process.

They will usually take the form of a formal or informal quality review, whichever is

specified in the Product Description.


51

Figure 19: The Product Description & Quality Review Relationship

Quality control may take many forms from a visual inspection, through a test programme,

to a formal meeting. These are all Techniques and PRINCE 2 describes some, but not all

that might be available - the selection of appropriate Techniques is left to the

implementing organisation. However, one of the most powerful Techniques is the Qualityreview which has been successfully used in a wide variety of projects for a number of

years.

The Formal Quality Review has three distinct steps:

♦ Preparation - where the Product or Deliverable is measured against the QualityCriteria contained in the Product Description, and Error Lists are created by selected

Reviewers who are able to make a suitable contribution.

♦ Review - where the Product or Deliverable is “walked-through” by its Producer andan agreed list of Follow-up Actions is agreed. The Reviewers who prepared the original

Error Lists attend this Review.

♦ Follow-up - where the identified faults, errors, omissions and inconsistencies in theProduct or Deliverable are fixed, agreed and signed-off.

At each Quality Review, appropriate Supplier and user/customer staff are designated toexamine a Product to ensure that it is complete and correct; these “appropriate resources”

are identified in the Stage-level Plan and the corresponding Product Description.

The Product is reviewed against defined quality criteria contained within the Product

Description, which assures its technical integrity and its compliance with user or customer

requirements; It is thereafter an “Approved Product “subject to formal change control

procedures. If any subsequent changes are made to Approved Products, there shouldalways be a reference back to the original Product Description to determine whether a

corresponding change needs to be made. This procedure applies to informal quality

reviews (for example a test, visual inspection, or desk-check) and to formal qualityreviews where 2-3 reviewers meet with the author of the product under the chair of a

suitably senior person to “walk-through” the product.

Product

Description

•Composition

•Quality Criteria

•Type of Check

•People Required

The Product

Quality Review

Checking the Product against

the Quality Criteria published

in the Product Description

Activity (shown on the Gantt or Timescale Plan) consuming Resources (Time/Effort/Funding)


52

Change Control

Unplanned situations relating to changes to one or more Products need to be captured as

“Issues” relating to the project.

* Good Ideas

* Errors

* Departures From Agreed Specification

* Resource Changes

* Specification Changes

Project Issue(Request for Change

or Off-Specification)

Originator Raises A

Sent to Project Support

Logged byProject Support

Reviewed by Project Manager

Project Issues Log

* Slippage/Budget Changes, exceeding Tolerance or

affecting other projects within the Programme

= Decision by Project Board (Exception Report)

OR ....

*Changes Within Tolerance = Decision by Project Manager

and action taken to implement the change.

Project Issues Log Up-dated

Notify OriginatorCopy returned

to confirm receipt

Figure 20: Suggested Procedure For Controlling Changes

Examples of this are good ideas that project team members identify, resource changes,

errors discovered in a finished product, and departures from the agreed specification.Because the situation is unplanned, it needs to be recorded and action agreed, in order to

contain the impact and prevent wider divergence from plans. Issues are best handled

within the framework of a formal Configuration Management scheme.

An Issue will be raised to cover any situation which needs to be addressed within the

project and to a large extent is a “catch-all” for many unforeseen incidents; for example,

where no agreement can be reached on the outcome of a Quality Review, am Issue will beraised to alert the Project Manager.

Configuration Management

A Configuration Management Method (CMM) controls the development of products by

providing a formal mechanism for labeling products, their development status, and therelationship between them. PRINCE 2 does not define or recommend a specific CMM but

emphasises the need for a suitable system and clearly states that the presence of suitable

arrangements for Configuration Management is not optional.


53

Configuration Management can be particularly useful in tracking back problems with

delivered, signed-off Products which fail to perform as expected in operation;

identification of the developer or supplier is vital to ensure that problems are tracked back

to source and appropriate action taken.

Filing Arrangements

PRINCE 2 contains a recommended filing structure which implementing organisations

may find useful as a start point. Where existing filing arrangements are in force, or where

organisations wish to arrange things differently, this may be done without conflicting with

the Method.

Figure 21: The PRINCE 2 Suggested Filing Structure

Software Support for PRINCE 2

In partnership with CCTA, the owners of the PRINCE Methodology, IBM (UK) have

developed a support tool called “The PRINCE 2 Environment”. This tool provides a

complete electronic support function which enables the Project Manager (or Project

Support) to keep track of the many project documents that are created during the life of theproject and to launch any application that is needed to manage the project.

Typical applications will be project planning tools, word-processing and spreadsheets;

both applications and associated files can be launched, modified and saved. The PRINCE2 Environment also contains the full PRINCE documentation and “skeletons” for the

creation of the Project Initiation Document. Users can add extra options and incorporate

their existing documentation to supplement the basic material supplied with the PRINCE 2Environment.

An alternative – The Launch Pad – is available from SPOCE Project ManagementLimited, providing similar functionality to the PRINCE 2 Environment. An evaluation

copy can be downloaded from web site www.spoce.com

Project FileOrganisation

Plans

Business Case

Risk Log

Control Documents

Product Checklist

Lessons Learned Report

Files

Stage File(s)Organisation

Plans

Control Documents

Daily Log

Correspondence

Product Checklist

Specialist FileConfiguration Items

Configuration Log

CI Locations

Off-Specifications

Quality FileProduct Descriptions

Quality Checks

Project Issues

Project Issues Log

Quality Log


54

Following This Introduction

The introduction to PRINCE 2 in this Chapter should be sufficient for the “incidental

user” or senior manager to understand the basics of the Method. The rest of this book

provides further information on PRINCE 2 and explores each topic in more detail.

Although the Method is “Process-Driven” and the eight Processes use the Components and

Techniques, the recommended starting point to understand what is going on within aPRINCE 2 project is the Components.

The remaining Chapters deal with the PRINCE 2 Components, explaining theircomposition and progresses through Processes to Techniques, adding value to the basic

descriptions in the PRINCE 2 Manual.


55

UNDERSTANDING THE

ORGANISATION COMPONENT

Chapter 3


57

PRINCE 2 Organisation - Introduction

Project organisation and staffing is the key to the successful management of any project.

If the project staff have the right leadership, the appropriate technical competence, have

the will to make the venture successful, and understand exactly what is expected of them,

then the project will have an excellent chance of success.

Figure 22: The Suggested PRINCE 2 Organisation Structure

At the top of the organisation structure there will normally be a strategy body (PRINCE 2

identifies this as Corporate or Programme Management) responsible for interpreting the

overall objectives of the organisation into working arrangements, systems or otheroutcomes. In private-sector organisations this body might well be the Board of Directors.

The PRINCE 2 organisation model assumes a Customer:Supplier environment within

which the project management components, processes and techniques will operate. Thestructure assumes there will be a customer who will state and define the requirement, pay

for the project and use the outcome, and a supplier who will provide the necessary

experience, skills and know-how to create the End Product for the customer. This modelis used for all PRINCE 2 controlled projects - the supplier might be an external private

sector company or an internal division of the purchasing organisation - the approaches

used are similar. The main emphasis within the PRINCE 2 organisation component isconcentration on direction, management, control and communication. The method

provides a flexible framework which is capable of being mapped onto any organisation

with the minimum of disruption, and which provides the template to achieve the key

outputs.

Corporate or Programme Management

The Project Board


Project Assurance





58

Within any PRINCE project organisation, at least three interests must be represented:

♦ Business Interests - ensuring that the eventual output of the project meets (and

continues to meet) a stated business need while at the same time representing good value

for the time, money and other resources expended.

♦ User Interests - specifying the desired outcome and ensuring that the project actuallydelivers what is required. Essentially representing the interests of those who will use the

outcome to deliver the business benefits.

♦ Supplier(s) Interests - providing the necessary knowledge, skills, equipment andresources to produce the outcome in accordance with the specification and acceptance

criteria. There will often be internal and external specialist suppliers working co-

operatively on the project.

Responsibilities in a PRINCE 2 Controlled Project

The PRINCE 2 Method provides guidelines for the responsibilities that can be expected

to be placed on individuals working within the PRINCE environment. These are presented

in the form of Role Descriptions which should be used as input to discussions to secure the

final definition of the roles and responsibilities for all members of the Project Board andthe Project Management Team. Tuning the role descriptions is best carried out in three

passes:

♦ Step 1 - Tune the role descriptions to suit the specific project (they should alreadyhave been tuned to reflect the organisation’s culture, standards and requirements);

♦ Step 2 - Modify the resultant role descriptions to suit the individual filling the role -

ask why that particular individual has been chosen for the role - what specifically does

he/she bring to the project;

♦ Step 3 - Discuss each tuned role description with the individuals concerned and

secure their agreement and commitment to their organisational role.

Following this simple three-step process will help secure the commitment of the Project

Board members and Project Management Team. Taking the role definitions directly from

the PRINCE 2 manual is not recommended.

The Project Board

The Project Board is the overall authority for the project, having specific ownership for

the process “Directing A Project” and responsibility for delivering the required outcomeor End Product. It is the ultimate project authority and is responsible for the initiation,

direction, review and eventual closure of the project. To meet this function, Project Board

members must have the authority required to commit resources and to initiate new work.These are the prime selection criteria for Project Board members. The Project Board

comprises, as a minimum, representatives from the following three functional areas:


59

The Executive Role:

Overall Responsibility: to be ultimately responsible for the project, supported by the

Senior User and Senior Supplier.

The Executive has to ensure that the project is delivering value for the time, effort, costsand resources being invested, confirming a cost-conscious approach to the project,

balancing the demands of the Business, User and Specialist Provider Organisations. The

Executive will normally chair the Project Board meetings, owns the Business Case,represents the Customer’s interests and has final responsibility for the project.

The Senior User Role:

Overall Responsibility: Responsible for the specification of User needs, user liaison withthe project team, the integrity of the desired outcome of the project and for monitoring that

the solution will meet those needs within the constraints imposed upon the project.

The role represents the interests of all those affected by the outcome and the Products

arising from the project. The Senior User role commits User resources and monitors

Products against the stated and agreed requirement. This role will often involve more than

one person to represent all the user interests. The User and Customer roles will sometimesbe represented by the same individual or group of people.

The Senior Supplier Role:

Overall Responsibility: Representing the interests of those designing, developing,

facilitating, procuring and implementing the project Products.

The Senior Supplier role must have the authority to commit or acquire the (specialist)supplier resources required. In some projects, more than one person may be required to

represent the interests, and commit the resources, of the supplier.

Responsibilities of the Project Board Members

The PRINCE 2 Manual (Appendix C) provides lists of responsibilities for each of the

above roles. These are split between the Specific Responsibilities and the Assurance

Responsibilities for each of the identified roles. The role definitions must be adapted to

suit the organisation, project and individual tasked with the responsibility.

The three functional roles comprising the Project Board should not be interpreted as a

requirement for three individuals. In smaller projects, for example, two functional roles

may be combined in one person (although in normal circumstances it is not advisable forthe Project Board to be reduced to less than two individuals). In other circumstances

several individuals may take on a single functional role (eg where a number of user areas

are being served by the eventual outcome of the project).


60

The Project Assurance Function

PRINCE 2 separates the Project Assurance function from the Project Support function.

Accountability for assuring the project always resides with the Project Board and cannot

be delegated; the day to day tasks involving the assurance function may, however, be

delegated to appropriate individuals. There are two types of Project Assurance that can beexpected to be found within a project - External and Internal.

Figure 23: The Levels of Assurance

♦ External Assurance concerns itself with the assurance that the project is performing

in accordance with overall standards and approaches either published or recognised in

some way by the organisation. Examples might be that the project is conforming to theBS/EN/ISO9001 Quality Management Standard or following Accounting Conventions laid

down by a professional body or within legislation. Invariably some form of audit will

already be present within the organisation to verify that these standards are beingfollowed.

♦ Internal Assurance is ultimately the responsibility of the Project Board. Examples of

Internal Assurance are verifying that the Products/Deliverables output by the project

conform to their agreed Quality Criteria; that they perform in accordance with the User’sstatement of requirement; that schedule and cost budgets are being met; and that the

Business Case (Business Benefits) and Risks remains viable.

Project Management FunctionProject Manager Project Support

Team Managers

Project Team Members

- Product Creators

Project Assurance Function

Project Board Assurance Function

- Business

- User

- Supplier- Business

- User

- Supplier

External Assurance & Audit Function

Standards

- Quality

- Financial

- Technical


61

Delegation of Day-to-Day Project Assurance

Although accountability for Project Assurance rests with the Project Board it might well

be impractical for the individual members to carry out the tasks involved personally

(because of lack of time or lack of expertise). Each Project Board member may, therefore,

enlist help from other sources to actually perform the day-to-day Project Assurancefunction on their behalf. It is important to note, however, that this responsibility is only

delegated - the Project Board retain full accountability.

Delegation of the assurance function may be to any number of individuals, although the

numbers must obviously, be sensible. The selection of appropriate people for the

assurance roles is also important - the assurance function must be independent of theProject Manager and it is not appropriate for any of the assurance function to be delegated

to the Project Manager or Team Manager(s). In practice, an existing Quality Manager or

Project Support Office might be used to carry out either or both Internal Assurance and

External Assurance - responsibility for getting it right rests with the Project Board (andultimately with the Executive Member).

The Project Manager

All projects need a focal point to plan, control and oversee the day to day work and to

co-ordinate the total effort. The Project Manager fulfills this role. PRINCE 2 requires

that all projects under the control of the Methodology have a Project Manager.

The prime responsibility of the Project Manager is:

♦ to ensure that the project as a whole produces the required products, to the requiredstandard of quality, and within the specified constraints of time and cost. The Project

manager is also responsible for the project producing a result which is capable of

achieving the benefits defined in the Project Initiation Document.

Figure 24: The Project Manager’s Relationship with the Project Board

In any PRINCE 2 project, there might also be one or more Team Managers to assist the

Project Manager to plan, manage and control a specific Technical Stage. It is the

The Project Board


Project Manager

User Assurance Specialist Assurance Business Assurance

Project Assurance Assurance


62

responsibility of the Project Manager to direct and co-ordinate the efforts of all TeamManagers.

Team Managers will usually be appointed to plan and control particular specialist areas,

where the Project Manager lacks the detailed knowledge and/or experience and/orresources directly under his/her control to carry through the specific tasks required.

A selection of the main tasks for the Project Manager is as follows:

♦ Overall planning for the total project;

♦ Motivation and Inspiration;

♦ Drive the project towards a successful outcome;

♦ Liaison with other related/associated projects;

♦ Liaison with Programme Management for related projects;

♦ Define responsibilities for each Specialist Team Manager;

♦ Report to and take direction from, the Project Board;

♦ Present regular Highlight Reports for the Management Stage (and the impact on the

overall project) to the Project Board.

The Project Manager role is essential for large, complex, high-profile, high-risk,

undertakings and may be supported by one or more specialist Team Managers.

Team Manager(s)

The Team Manager is an optional role and may be expected to exist on large, high risk

projects. Where appointed the Team Manager is responsible for the day-to-day

management of the specialist work package activities and products under his/her control.

Typically, but not necessarily, a Team Manager will have line responsibility for a specific

specialist team appointed to be responsible for a discrete part of the project; for example

the supplier of key technical equipment, or a building contractor might be appointed as aTeam Manager for part of the customer’s project. In such circumstances it is quite normal

that the Team Manager is also the supplier’s Project Manager. The Team Manager works

to the defined and agreed plans for the stage products and activities and reports to the

Project Manager.

Team Managers may also be appointed where the project is large and the Project Manager

requires some experienced support at the management level. Also where there arepressing geographical reasons, a Team Manager might well be nominated to implement a

particular part of the solution within a geographic region.


63

The options described above are not exhaustive and Project Managers and their respective

Project Boards should use imagination and creativity to determine where and when to

make the best use of this PRINCE 2 role.

Figure 25: The Team Manager’s Relationship with the Project Manager

Responsibilities of the Team Manager

The prime responsibility of the Team Manager is:

♦ to ensure production of those Products defined by the Project Manager to anappropriate quality (ie conforming to the Product’s Quality Criteria agreed within the

Product Description), in a time-scale and at a cost acceptable to the Project Manager and

the Project Board.

The Team Manager reports to and takes direction from the Project Manager. The Team

Manager will work with the Project Manager to define responsibilities for the team

members and provide plans, guidance, motivation and inspiration. All suggested changesrelating to the Products which are the responsibility of the Team Manager, raised

informally or as Project Issues will be routed through the Team Manager for

recommendation or decision on further action.

The Team Manager will work closely with his/her teams, providing advice and guidance

and taking decisions. The Team Manager will attend (and usually run) Checkpoints and

raise Checkpoint Reports for the Project Manager at the frequency agreed in the WorkPackage, and may help the Project Manager to provide the regular Highlight Reports to the

Project Board.

Project Support may be used by the Team Manager where this is acceptable to the Project

Manager. At the discretion of the Project Manager, Project Support will provide

administrative assistance freeing the Team Manager from the day to day administration,and enabling provision appropriate support and guidance to the team members. In some

cases, Project Support may act as a “Scribe” at Quality Reviews to help with the

Project Manager




64

administration and recording of this important control.

Team Managers and Technical Stages

PRINCE 2 draws a distinction between Technical Stages and Management Stages. A

Team Manager will take responsibility for one or more discrete Technical Stages of the

project.

Technical Stages relate to the delivery of specific portions of the final solution (or End

Product) for the project and there may well be a number of Technical stages, each underthe control of a different specialist Team Manager, running within one or more

Management Stages.

The Management Stages provide the basis for a series of major milestones during the life

of the project and represent the points in time when the Project Board will, at an End-

Stage Assessment (ESA) decide whether the project should go forward, be “frozen” for a

period of time, existing work be “re-visited”, or the whole project aborted.

Management Stages allow the Project Board to control the commitment of resources to the

project and provide authority to spend; they are also described by the Method as“partitions of the project with decision points”.

Project Support

The Project Support function on a formal basis within a PRINCE 2 project will only exist

where there is a need for it. Its existence is driven by the needs of an individual project

(and Project Manager). In general, the kind of support provided will be administrativehelp to the Project Manager and the Team Managers where these are appointed.

Where organisations already have a Project Support Office in place, there need be nochange, although there will need to be a clear distinction drawn between the services

provided to the Project Manager by the Project Support Office staff and any Project

Assurance function they might be performing on behalf of the Project Board. The Project

Support prime function is:

♦ to provide administrative support and assistance to the Project Manager and the

Specialist Team Managers. Project Support may also provide support to the Team

Members in terms of advice and the interpretation of the project management, qualityand technical standards.

Project Support responsibilities comprise (among others as specified and agreed with the

Project Manager) the following:

♦ Administer Change Control;

♦ Set up and maintain the Project Files;

♦ Establish Document Control Procedures for the Management Products;


65

♦ Compile, copy and distribute all Management Products;

♦ Collect Actual Performance Data and Forecast Data, and update the Plans;

♦ Administer the Quality Control Processes;

♦ Administer Project Board Meetings;

♦ Assist with the compiling of reports;

♦ Configuration Management activities.

♦ Performing the “Scribe” role at Formal Quality Review Meetings.

The selection of appropriate Project Support personnel (either for the direct support of theproject or through the creation of a Project Support Office) is important to the overall

success of the project. Typical knowledge and skills necessary for this key position might

include, among other areas:

♦ A broad understanding of estimating techniques (especially those used by the

Organisation);

♦ specialist knowledge and competence with the organisation’s chosen software support

tool, and other project management software support tools such as those for RiskAssessment and Management;

♦ any other specialist knowledge that might be needed to support and reflect the

organisation’s existing standards, approaches and professional ethics andapproaches;

♦ administrative approaches relating to the organisation’s own filing and related

configuration approaches;

♦ planning and scheduling principles knowledge and expertise;

♦ good communication and interpersonal skills;

♦ a pro-active approach!

Customer:Supplier Environment

A suitable organisation structure for Customer:Supplier projects is included in the

PRINCE 2 manual and shown in figures 26 and 27. PRINCE 2 assumes that the projectwill be a joint venture between a Customer and a Supplier, who might be an internal or

external supplier of the specialist portion of the project.


66

Figure 26: The PRINCE 2 Customer:Supplier Organisation Structure

Figure 26 is as far as the PRINCE 2 Manual takes the Customer:Supplier Environment – a

full view of the typical Customer:Supplier Organisation Environment to be found in aPRINCE 2 managed project is illustrated in figure 27 below.

Figure 27: Comprehensive View of the Customer:Supplier Organisation Environment

Developments On The PRINCE 2 Theme

A similar structure has been used successfully by customer and supplier organisations for

a number of years; it is similar to that proposed by PRINCE 2 as a suitable start-point, but

Customer Project

Boardn Senior User

n Executive

Supplier Project Boardn Customer Account Manager

n Supplier Skill Management

n Senior Supplier

Project Board

•Executive

•Senior User

•Senior Supplier

Customer Organisation Supplier Organisation

Customer Project Board Supplier Project Board

The Project Board(Joint Representation from

Customer & Supplier Project Boards)

Customer

Project Manager

SupplierProject Manager

SupplierTeam Manager

Customer

Team Manager

Customer

Resources

Supplier

Resources


67

has a few modifications which provide an alternative but compliant option. This model(figure 28) provides a practical approach to handling the day-to-day communication

linkages between the respective Project Managers and their respective teams, and the

higher level exchanges between each Project Board and has been used as an organisational

basis for private sector companies Local Government; Central Government and NHSTrusts. A key element is to ensure that the customer and supplier organisations have an

opportunity to take the necessary commercial and business decisions within the privacy of

their own management organisations, but with the facility to meet to iron out difficultiesand problems on a “without prejudice” basis.

The Supplier Project Board

Supplier senior management will always need to represent the interests of their customers

if the eventual business outcome is to be satisfactory to all parties involved.

Reflecting the “partnership” approach, it is tempting to include a User/Customer

representative on the Supplier Project Board. This approach is, however, flawed as the

PRINCE Methodology places overall and ultimate responsibility and authority for theproject in the hands of the Project Board with consensus agreement. A “real”

User/Customer representative at this level within the project will always be placed in an

invidious position, especially in times of trouble when hard decisions have to be made

about the possibility of re-defining the project deliverables or re-negotiating the contractprice or terms and conditions, where the Customer‘s only realistic stance can be “no

comment” - indecisive and certainly not recommended at Project Board level!

A similar situation occurs where a Supplier is asked to provide a representative for a

Customer’s Project Board. Although commitment of the Supplier’s resources will be able

to be achieved, in times of difficulty where a specialist solution appears not to be workingin the way the Customer had expected, the supplier representative always experiences a

conflict over whose interests should be protected.

The solution, endorsed by practical experience, is for the Supplier to providerepresentation from internal resources such as a Customer Account Manager to speak for

the customer and to ensure that, at the highest level within the project, due account is

taken of the customer’s position.

For the customer, where there is an unwillingness to have a Senior Supplier from the

organisation they have contracted with on the Project Board, specialist technical expertisefor the project may be bought-in from outside if there is no specialist expertise already

resident or available from within. Such an appointment carries with it the disadvantage

that the individual(s) concerned are unable to commit the necessary technical resources,

but this is relatively easily remedied through the contract arrangements.

Establishment of a Steering/Co-ordinating Group (possibly evolving into a Joint Project

Board) will help smooth the path for communication between all the senior managersresponsible for the project.


68

Customer: Supplier Steering/Co-ordinating Group

Each individual Project Board will be primarily responsible for the management of the

project within its own organisation, but there is also the need to meet on a regular basis to

discuss issues and to enable communication at a senior level. The Steering/Co-ordinating

Group (or Joint Project Board) pulls together all interested parties at Project Board, Project

Manager and, if appropriate, Project Assurance levels so that key decisions can be made.

Figure 28: The Customer & Supplier Management Structures

It is important to focus on the purpose of each meeting of the Steering/Co-ordinating

Group The objective is to provide a joint forum for decision making, the exchange of

“positive” views and the clarification of any issues. Progress and project status will be the

subject of separate arrangements (typically monthly Highlight Reports).

Within a contractual environment, it will always be advisable to set up each meeting with

the proviso that any discussions, views and agreements reached within theLiaison/Steering Group forum will always be “without prejudice to the agreed terms and

conditions of the contract”. Failure to do this might well result in an unwillingness to

enter into constructive debate and to provide mutually constructive suggestions to avoid orrepair problems.

Customer Organisation Supplier Organisation

Project Board Senior Management

(Project Board Equivalent)

Steering/Co-ordinating Group

(Joint Representation from

Customer & Supplier Project Boards)

CustomerProject Manager

Supplier

Project Manager

Supplier

Team ManagerCustomer

Team Manager

CustomerResources

SupplierResources


69

Customer: Supplier Project Manager

The supplier will always appoint someone to take responsibility for day-to-day

management of the project - the Supplier Project Manager. The communication lines

between the Customer Project Manager and the Supplier Project Manager are the strongest

ties between the two parties. This is reinforced where the Customer Project Managerregards the Supplier Project Manager as a (specialist) Team Manager within the customer

project.

The Project Manager will normally come from the Customer organisation and will take on

responsibility for managing the total project. This is because the Supplier’s role in the

overall scheme of things is usually restricted to supply and installation of equipment.There are many other vital component parts which must derive from the Customer project

- examples are the Specification, Business Design, Testing, Training etc.

Customer:Supplier - Project Support

Project Support may or may not exist on either side, but for major projects some form of

support will be established for the Project Manager. The communication links betweenthe support functions will be the regular reports (typically Highlight Reports) and

resolution of day-to-day queries between the customer and supplier project teams.

It is not envisaged that there will be any formal communication between customer andsupplier team members as this will always be routed through the Project Managers or

Project Support.

Organising The Managing Of Programmes

Most projects will have inter-relationships with other undertakings within and outside the

host organisation. In larger, longer term and high risk projects, there will be a consciouseffort to break the overall initiative into a series of smaller, more manageable projects,

each under the overall direction of a Programme Board.

The organisational aspects of programmes of work are straightforward and reflect the

basic principles of the PRINCE Methodology. The actual arrangements and structure will

vary with each programme and will need to reflect the local approaches, culture and, ifappropriate, contracts. The PRINCE 2 manual provides a suggested structure which

should always be considered as a suitable start point. The following model (Figure 29)

has formed the basis for a number of successful programmes and provides a near

alternative for consideration:


70

Figure 29: Alternative Programme Management Organisation Model

Programme Board, Programme Manager & Programme Support

The Programme Board will appoint a Programme Manager to oversee the delivery of the

overall initiative. The Programme Manager may be a member of the Programme Board,

although this is not necessary or recommended.

Support to the Programme Manager is provided by Programme Support who are also

responsible for the overall programme integrity and the correct use of the organisation’s

project management and quality management standards. They will also, therefore, take onthe day to day role of Programme and individual Project Assurance on behalf of the

Programme Board members and individual Project Board members. Accountability for

Programme and Project Assurance remains, of course, with the individual roles on therespective bodies.

Quality Assurance is normally a separate function and vested in the Quality Manager; theappointment of a joint Programme/Quality Assurance function role is the responsibility of

the Programme Board.

To avoid large numbers of individuals on Programme Boards, it is often convenient toestablish a Steering Group which is strictly speaking outside the project boundary. Such a

group may meet as frequently or infrequently as deemed to be appropriate and the

membership need not be limited.

Programme Board

Representation from User/Customer, Supplier Function & Business Function

Programme ManagerProgramme Support

+ Project Support

Customer

Group

Project Board - 1 Project Board - 2 Project Board - 3

Project Manager Project Manager Project Manager

Programme/Project Resources (some common; someowned by one project)

Corporate ManagementSteering

Group


71

The Steering Group will be kept fully informed of the progress of the programme and willbe invited to contribute to the overall direction of the initiative.

The group will not, however, be responsible for decision making within the programme -

this vests absolutely in the Programme Board, devolved as appropriate to the ProgrammeManager, Individual Project Boards and Individual Project Managers.

User/Customer Group In A Programme Context

Programmes of work often imply the need to address a large customer base and this is

catered for by having a separate Customer Group. This group will provide the SeniorUser/Customer on the Programme Board and the Senior User for each of the individual

Project Boards. Each individual Project Board Senior User is responsible for appointing

any necessary user/customer liaison resource, possibly coupled with assurance

responsibilities, within the project management team.

Individual Project Boards In A Programme Context

The individual Project Boards operate exactly as they would within a standard PRINCE 2

project. The members are overall responsible for delivery of the project(s) they own.

They will meet at appropriate event-related times to review the project and to approve itscontinuation and commit the resources. Each individual Project Board will comprise a

Senior User/Customer representative, a Supplier representative, and an Executive/Business

representative.

As mentioned above, the User/Customer Group will provide the Senior User. The

Programme Manager is best positioned to chair each Project Board and represent the

business interests of the overall programme and the host organisation. The individualProject Board Supplier representative will be assigned/appointed by the Senior Supplier on

the Programme Board.

Project Support & Programme Assurance

Each individual Project Manager may be assisted by a Project Support function if this is

deemed to be necessary given the size, scope and complexity of the project and the

experience of the Project Manager.

Project Support will keep the project plans up to date and on a regular basis, usuallymonthly, will provide a summary of status and progress to Programme Support who will

use this information to up-date the overall programme plan for the Programme Manager.

A Programme Highlight Report will be prepared and sent from the Programme Manager toeach member of the Programme Board. Assurance for the whole programme of work and

for individual projects will primarily be the responsibility of Programme Support whose


72

authority devolves from the Programme Manager.

Typically (but not necessarily) the Programme Board will meet on a time related basis,

possibly every 6-8 weeks, depending entirely on the sensitivity, risk or profile the

programme has within the organisation.

Programme And Project Resources

These are often shared over all projects and identification, use and monitoring of the

resource pool is an important aspect of managing a programme of work. It is all too easy

for each individual project to plan to use the same resources to the full extent of theiravailability, thus ensuring over-utilisation and consequent slippage of the whole

programme. This can be avoided by the use of a suitable software planning tool which

allows sub-project or roll-up planning.

Other Structures Based On PRINCE 2

The PRINCE 2 organisation structure principles may be used to form the basis of a

variety of different projects. For example, many organisations are involved in Concurrent

Engineering or Rapid Application Development projects; a suitable PRINCE 2 compliant

structure has been produced and is included on the next page (Figure 30).

The model as presented is straightforward and conforms, generally, to the requirements of

PRINCE 2, with an owner with ultimate authority (The Project Board) reporting to

Corporate Management to ensure that the development project resides within the overallstrategy for the organisation, reflecting corporate objectives.

The Project Team is totally enclosed within the project structure, with separate TeamManagers responsible for the discrete stages of the work.

The project is under the direction of a Project Manager, exercising management control

on a day to day basis through the Team Managers and through Project Support, as theProject Manager may be expected to be fully involved with the development, testing and

installation of the emerging end-product.

Products will be passed forward within the organisation to the succeeding Team Manager,

and in some circumstances passed back for re-work.


73

Figure 30: Rapid Application/Concurrent Engineering Organisation Model

Project Support will provide an important co-ordination function within this type ofproject. Typical tasks will include:

♦ setting up regular (possibly 4-6 meetings between Team Managers and the Project

Manager every day);

♦ up-dating the Project Plan to show actual progress and expenditure profiles;

♦ initial preparation of Highlight Reports for the Project Board;

♦ liaison with any Project Assurance appointees to ensure that organisational standards

are being observed;

♦ incidental support to the Team Managers;

♦ provision of a communications centre for the whole project.

Quality Assurance imposes a discipline from the Corporate level through a published

Quality Management System and Project Assurance remains the responsibility of the

Project Board, although this may be delegated (but not to anyone within the Concurrent

Engineering/Rapid Application Development team).

Specification, Analysis

& Design Team

Team Manager

- User/Customer

- Analyst

- Design

Resources

Development Team

Team Manager

- Programmer

- Analyst

- Design

Resources

Implementation & User

Testing Team

Team Manager

- User/Customer

- Analyst

Resources

Project Manager

Project Support

& Administration

Project Resources

Corporate Management Project Board & Project Assurance


74

It should be stressed that the organisation structure shown does not form part of thePRINCE 2 Method but is included to illustrate how the principles within the method may

be easily adapted to reflect organisational needs.

PRINCE 2 Organisation - Summary

The key points within the PRINCE 2 Organisation Component are:

♦ Corporate or Programme Management appoints the Project Board, who have overalland ultimate responsibility for the successful delivery of the project. Initially the

Executive member is appointed (Process SU1) along with the Project Manager.

♦ The Project Board endorse the Project Management Team designed and initiallyappointed by the Project Manager and Executive within the SU Process.

♦ The Project Manager is responsible for day to day planning and control, helped where

appropriate by one or more of Team Managers. Project Support might be provided

where the Project Board believe this would help.

♦ The Project Board members may choose to delegate some or all of their Project

Assurance responsibilities, but accountability will always reside within the Project

Board, and ultimately with the Executive.

♦ Project Support provide administrative support (and sometimes technical help) to the

Project Manager and, where appropriate, to the Team Manager(s).

♦ Project Assurance will always be a separate entity to Project Support.

♦ A Project Support Office might well address both support and assurance functions, but

these would need to be assigned to separate individuals within the Project Support

Office.

♦ Products and documents must be properly stored and safeguarded, and a suitableConfiguration Management System must be in force to make these arrangements;

Project Support will usually be responsible for the operation of the Configuration

Management System - the Project Manager is responsible for its integrity, which willbe audited by Project Assurance on behalf of the Project Board.


75

UNDERSTANDING THE

PLANNING COMPONENT

AND

PRODUCT-BASED PLANNING

TECHNIQUE

Chapter 4


76

Planning - Introduction & Overview

The PRINCE 2 Method does not prescribe any particular type of plans which must be

used on a project. The principles of “Product Based Planning” are incorporated in the

method within the “Techniques” section and the overall assumption is that some form of

software support planning tool will be used.

The exact form and layout of the plans is left for the implementing organisation to decide,

probably influenced strongly by whatever software planning tool is currently in use.

There will typically be up to 3 planning levels within a PRINCE 2 project, although there

is no limitation on the number of levels which might be utilised. Typical levels of planare:

♦ Level 1: Project Plans

♦ Level 2: Stage Plans

♦ Level 3: Team Plans

♦ plus Exception Plans where there has been a significant departure from the approved

plans and some re-planning must be done to recover the situation.

Individual Plans assigning particular Products and their associated work packages to

members of the project team might also be utilised if this is appropriate.

Figure 31: Levels of Plan In PRINCE 2

Plans at Levels 1 and 2 are necessary for effective planning of a major project – both theProject Plan and the Stage Plan are mandated in the Method.

Project Plan (Mandatory Plan)

Stage PlanStage Plan Stage Plan

Team

Plan

Team

Plan

Team

Plan

Team

Plan

Team

Plan

Team

Plan

Project Resources Report(Effort, Costs, Equipment, Direct Costs)


77

Project Plans may provide sufficient detail for the early stage plans to be incorporatedwithin them. Plans at the lower Levels are optional but will usually be necessary to

produce in order to gain full understanding of the undertaking and to exercise effective

control at team level.

The plan structures at all levels (including the Exception Plans, which are intended to

replace the plan which it has been necessary to up-date) are similar in content and

structure; at team level for the individual, if these are used, the only plan needed will be asimple Gantt Chart or Activity List covering either one or two elapsed weeks. This type of

plan is often available as a standard output from the planning support software.

Figure 32: The PRINCE 2 Plan Package

Project Level Plans

Construction of PRINCE plans should normally be on a top-down basis; this will provide

a logical and controlled descent into detail and will help to identify any grouping of

Products and associated activities that might usefully be treated as a separate sub-project.

In some cases, however, it will be appropriate to work at the stage level in order to provide

a realistic picture of the total development. The more detailed activities will then need to

be grouped to provide an overall view at the project level.

Plan

Text

The Plan Text provides a high-level, overall view of

the plan, summarising its key features

Product

BreakdownStructure

Identifying the Products/Deliverables that will be

produced by the Project. The Products will be categorised

under the headings of “Specialist”, “Management”, and

“Quality” Products.

Product

Descriptions

Describing the Products/Deliverables that will be

produced by the Project. There is a prescribed format

for Product Descriptions

ProductFlow

Diagram

Describing the relationships that exist between

each Product/Deliverable, and external entities.

PERT

or

Activity

Network

Showing the relationships that extist between the Activities that will be undertaken

to create the Products identified in the Product Breakdown Structure.

Gantt

or

Timescale

Plan

Derived from the PERT Network, this shows when Activities are

planned to start and end. Major Review points (End Stage

Assessments) are also shown on this plan.


78

Product Breakdown Structure

The start-point will be to give consideration to the design of the plan (how many levels,

the general approach to planning, the most suitable software support tool to use,

involvement of external support services etc).

As the initial step, a list of Products to be produced during the project must be created.

These Products will be at the Project level and must be identified by the Project Manager

and the appropriate Team Manager where appointed. The resultant list should then becritically reviewed with the Project Management Team in the light of what is known about

the proposed project, to produce an agreed list of high-level Products to be produced. This

is known as a Product Breakdown Structure and contains a list of the Specialist Products,Management Products, and Quality Products associated with the project.

Figure 33: Specialist, Management & Quality Products

Each Product must be supported by a Product Description which addresses the following:

♦ Product Title & Identification;

♦ Purpose;

♦ Composition;

♦ Derivation;

Management Information System

Specialist Products

SP01 - User SpecificationSP02 - Logical Design

SP03 - Physical Design

SP04 - Contract

SP05 - HardwareSP06 - Software

SP07 - Communications

SP08 - Integrated System

SP09 - Technically Tested SystemSP10 - User Accepted System

SP11 - Trained Staff

SP12 - Test Products

Quality Products

QP01 - Product DescriptionsQP02 - Quality Review Documentation

QP03 - Project Issues Log

QP04 - Quality Log

QP05 - Configuration Management

Management Products

MP01 - Project Initiation Document

MP02 - Stage Plans

MP03 - Lessons Learned LogMP04 - Risk Log

MP05 - Business Case

MP06 - Product Checklist

MP07 - Highlight ReportsMP08 - Project Start Notification

MP09 - Project End Notification

MP10 - Project Filing Structure

The Project Management

Standard for the

Project

The Quality Management

Standard for the

ProjectThe Technical Management

Standard for the

Project


79

♦ Format & Presentation;

♦ Allocated To;

♦ Quality Criteria;

♦ Type of Quality Check Required;

♦ People or Skills Required for Reviewing/Testing the Product.

The above headings may be added to but must not be omitted in order to secure PRINCE 2

compliance.

Product Descriptions form a significant part of the Quality Plan for the project and are

fundamental to its successful outcome. For these reasons Product Descriptions must not,

in any circumstances be omitted from any PRINCE controlled project.

Figure 34: Example Product Breakdown Structure For The “User Specification” Product

Every PRINCE 2 project will have at least one Product identified (the End Product) and

defined in terms of a published and baselined Product Description. Baselining of a

Product Description will take place when the plan it relates to is baselined (agreement by

the Programme Director/Executive (for Programme Plans), the Project Board (for ProjectPlans) and the Project Manager (for Team Plans)).

A Product Description, once approved and base-lined, may only be changed via the

Change Control procedure.

SP01 - User Specification

User Requirements Enhancements

Functional

RequirementsData

Requirements

Education

StrategyTesting

StrategyCut-Over

StrategyFall-Back

Strategy

Strategies

Short/Medium

TermLong

Term

Technical

TestingUser

Testing

Module

TestingSystem

Testing


80

Product Flow Diagram

A Product Flow Diagram may then be drawn showing how the various products identified

are derived, one from another and from external Products and Entities. This helps to

confirm that all the Products that need to be produced have, in fact, been identified; all

Products in the Product Flow Diagram must balance with those in the Product Breakdown

Structure, and each must be supported by a Product Description.

Figure 35: Product Flow Diagram

The Product Flow Diagram helps set a basic approach and chronology for the completionof the Products. Stage beginnings and endings, and candidates for sub-project groupings

can also be determined from this diagram, although the final timings of Management Stage

endings will not be able to be made until later when the Gantt Plan (or Timescale Plan) hasbeen produced.

Construction of the Product Flow Diagram helps the project planners to appreciate theoverall approach and strategy that underpin the project. Any "missing" Products will be

more easily identified (these must of course be incorporated into the Product Breakdown

Structure and defined within Product Descriptions).

Less than obvious linkages between Products will be more clearly apparent at the time the

Product Flow Diagram is drawn, and the successive iterations will help to hone the overall

approach to a more realistic shape.

Another useful function of the Product Flow Diagram is the help it gives in identifying

Activities for inclusion in the activity plans.


SP02 - Logical Design


SP04 - Contract

SP06 - SoftwareSP05 - Hardware SP07 Communications


SP08 - Integrated System

SP09 - Technically Tested

System

SP10 - User Accepted

System

SP11 - Trained Staff

Users/Existing SystemFeasibility Study

Potential Suppliers


81

Figure 36: Product Flow Diagram With Activities Identified

The Activities identified on the Product Flow Diagram are sometimes referred to as

“Transformations” reflecting that they provide the means of transforming one or moreProducts into another.

PERT Network

The PERT Network is a basic tool in project management; its full designation is

“Programme Evaluation & Review Technique” and the information to produce it may be

derived from the Product Flow Diagram. Alternative names for the PERT Network are“Critical Path Network”, “Critical Path Method”, and “MIST - Minimum Irreducible

Sequencing Technique”.

The Product Flow Diagram defines the data flow and relationships between Products to be

produced, and the PERT Network defines the activities needed to create each Product.

The PERT Logic Network & The Timed Network

The Logic Network shows the activities needed to produce each Product and establishes

the dependency relationship between activities. The Timed Network provides additionalinformation on the elapsed time to be taken for each activity and allows the total project

cycle time to be predicted. The Timed Network will also provide information on start and

finish times, critical paths, sub-critical paths and float.


SP02 - Logical Design


SP04 - Contract

SP06 - Software


Users/Existing System

Feasibility Study

* Prepare & Issue Tenders

* Produce Tender Evaluation Criteria

* Assess Offers & Select Supplier

* Issue Contract* Produce & Agree Program Designs

* Write Programs (& Fixes)

* Unit Testing

* Suite Testing

* Extract Test Data

* Clean Data

* Produce Test Schedule

Produce Business (Logical) Design

Produce Business (Logical) Design

* Interview Users

* Produce Specification

Review FS


82

Figure 37: PERT Network - Timed And Logic Diagram

Earliest Start Gantt Plan

Using the information on earliest start and finish times from the Timed Network, an

Earliest Start Gantt Plan can be produced. This chart will provide the basis for Project

Board approval. But first some tuning/resource smoothing has to be carried out.

Figure 38: Creating The Earliest Start Gantt Plan

Resource Smoothing

The Timed Network will have assumed unlimited resources were available and

concentrated solely on the underlying logic of the relationship between activities. This

Earliest Start Time Earliest Finish Time Latest Finish Time

Activity Total Float

0 3 3

10 Appoint The PB Executive

0 0 3

3 2 5

20 Appoint The

Project Manager

9 6 11

11 5 16

30 Design & Appoint

The Project Team

11 0 16

10 4 14

60 Prepare Board

Position Paper

12 2 16

16 2 18

40 Produce The

Project Brief

16 0 18

3 7 10

50 Review The

Strategy Plan

5 2 12

3 8 11

70 Plan The

Project Approach

3 0 11

0 3 3

10 Appoint The

PB Executive

0 0 3

Earliest Start Time(EST) Earliest FinishTime

(EFT)

Latest Start Time

(LST)Latest Finish Time

(LFT)

Duration

Total Float


83

does not, of course mean that any number of people are available to the project, but thatthose that are assigned to the project are assumed to be able to work at any time (even to

the extent of carrying out simultaneous multiple activities.

Figure 39: Creating The Resource Smoothed Gantt Plan

The Earliest Start Gantt Plan will clearly show overlapping activities where resource usagewill be over-stretched. To inject reality into the plan it will be necessary to smooth the

resources.

Although not dealt with in the methodology, resource smoothing is an essential feature ofproject planning. Resource smoothing is best carried out using a software support package

(such as Microsoft Project (MS Project), Project Manager’s Workbench (PMW), or

Primavera), initially, and then tuning "by hand". Full manual resource smoothing is a timeconsuming and tedious task involving many iterations and modification of both the Time-

scale/Bar Chart and the underlying Timed Network.

After smoothing, the resource usage may still be excessive, or the end date for the project

may have slipped back too far to be acceptable to the sponsor. In these cases it will be

necessary to reconsider the logic of the Timed Network and to plan for overlaps of activity

that would enable more effective use of resources and bring forward the delivery forecast.Such action will invariably increase the risks to the project and will need to be properly

assessed and documented for a decision by the Project Manager or Team Manager and

subsequent endorsement by the Project Board.

Produce PlanId Sources

Prepare Docs

Prepare I/Vs

AppointmentsInterviews

Un-smoothed Gantt Plan (Earliest Start)

Produce Plan

Id Sources

Prepare DocsPrepare I/Vs

Appointments

Interviews

Management

Stage 1

Management

Stage 3Management

Stage 2

Resource Smoothed Gantt Plan (With Stage Reviews)


84

Project Gantt Plan

The Gantt Plan is the result of the resource-smoothed earliest-start bar chart. and provides

a view of the Products related to the envisaged time-scales for the total project, readily

showing where "clusters" of Products will be ready and thus point to natural Stage

beginnings and endings. The Project level Gantt Plan has the End Stage Assessment

control symbols added in, at appropriate key decision and resource commitment points andis then ready for approval by the Project Board.

Figure 40: Gantt Plan With End Stage Assessments Added

Project Resource Reporting

A Project Resource Report provides a summary of the Effort and Cost of that effort on a

Stage-by-Stage basis. A separate Resource Plan is not specifically required by PRINCE 2,as the Method presumes that a software planning tool will be in use and any resource

information required will be able to be drawn from the Project Plan and presented in

whatever format is required.

Information on the planned use of resources (and the subsequent record of actual usage) is

an essential element of decision support for management and should not be omitted

without good reason.

In projects where a software support tool is not being utilised, it may be produced by

taking a copy of the Project Gantt Plan and creating a "Transfer Sheet" for each resourcetype. The transfer sheet provides a statement of the resource usage against each activity

for the whole project; the planned effort usage for each stage is totalled and transferred to

the Project Resource Plan.

Initiate

Specify

Design

BuildTest

Train

Hand-over

ManagementStage 1

ManagementStage 3

End Stage Assessment(ESA)

Project InitiationProject Closure

ManagementStage 2


85

Stage 1 Stage 2 Stage 3

Plan Actual Plan Actual Plan Actual

EFFORT (Staff Weeks)Skill Types

Customers

Engineers

IT Analysts

Others

COSTS (£K)Skill Types

Customers

Engineers

IT Analysts

Others

Equipment

Fixed Price Elements

Total Stage Costs

Total Project Costs

Figure 41: Resources Report (or Plan)

The resource effort on the Project Resource Plan is then converted to resource cost by

reference to capitation or charge-out rates. Direct costs (for purchase of equipment etc) is

also added, as is the cost of any purchases for the development.

The aim is to capture the total, true costs of the project. When all the costs have been

identified on the Project Resource Plan, they are cumulated in order to provide input to a

Graphical Summary of the overall project.

Graphical Summary

This plan is not a stated or required part of the PRINCE 2 Method, but is useful to know

about as it enables the project plans to be summarised on a single sheet in a graphical

format. It summarises the planned expenditure using the vertical axis to illustrate costsand the horizontal axis for time. At the project level it is acceptable to show a cumulative

summary of each stage's planned costs , although the Project Board may require a more

detailed analysis. If this is required, the Project Resource Plan should be re-drawn to show

information at a similar level as it is important that all plans should be consistent with eachother.


86

Figure 42: Graphical Summary Of The Plans

A useful feature on the Graphical Summary is the inclusion of delivery slots for majorProducts. This information provides essential technical progress data and enables the

Project Board to assess the actual achievement against actual spend when reviewing the

plans at the end of each stage. The headings used in the Graphical Summary to show the

status of each Product may be used in conjunction with the Product Checklist. Thisdocument has planned and actual dates inserted to show progress of Products. It is most

useful at Management Stage level but is also produced at Project level.

Earned Value Analysis

An extension to the Graphical Summary is the Earned Value Analysis chart. This

technique takes performance measurement a step further, enabling a clear measurement ofthe project work accomplished and more disciplined forecasts of the likely task and

Product completion dates and associated costs. The concept of Earned-Value Analysis is

not incorporated into the PRINCE 2 Method, but is being used increasingly and may be

expected to be included in a subsequent revision.

Earned Value replaces the traditional practice which only compares Actual Cost with

Actual Progress and is based on assigning a value to the achievement of project work.Ideally achievement is measured in terms of Milestones and Major (ie Product-level)

Products delivered.

Time

Cost

Specific

atio

n

Busin

ess D

esig

n

Agre

ed D

esig

n

Contra

ct

Com

ple

ted S

yste

m

Teste

d S

yste

m

Tra

ined S

taff

Initia

l Support C

om

ple

te

Pilo

t Handover

Custo

mer A

ccepta

nce

Pro

ject C

lose-O

ut

Product Ready

Quality Reviewed

Work Finished

Work Started

Work Package Agreed

Management

Stage 1

Management

Stage 3

Management

Stage 4

Management

Stage 2

Stage

£20K ....

Stage

£14K ....

Stage

£58K ....

Stage

£18K ....

£20K

£34K

£92K

£110K


87

Figure 43: Earned Value Analysis

The value is usually monetary but can be expressed in any appropriate unit such as staff

hours or days. The value to be earned when a specific Milestone or Major Product is

achieved is based on the planned cost of achieving the Milestone.

For example, if the plan showed that £100,000 was required to achieve a specified

Milestone/Project Product, £100,000 worth of Earned Value would be credited to the

Project Manager (as “owner” of the Product”) when achievement of the Product wasdemonstrated (ie that the Product had successfully met all its Quality Criteria). Again, it is

worth emphasising that the plans described above, the Graphical Summary and the Earned

Value Analysis plan are not requirements of PRINCE 2, but are useful vehicles forillustrating project situations to the Project Board and other senior managers.

Risk Analysis

Risk analysis must be carried out in a structured manner. A Risk Analysis should always

be completed at Project Initiation and up-dated, minimally, when preparing for each EndStage Assessment/Project Board meeting.

PRINCE 2 requires that a Risk Log be kept to record the (hopefully reducing) risks faced

as the project progresses. The risk analysis provides a complementary part of the BusinessCase for the Project and will be summarised in the Project Plan Description.

Time

Cost

Specific

atio

n

Busin

ess D

esig

n

Agre

ed D

esig

n

Contra

ct

Com

ple

ted S

yste

m

Teste

d S

yste

m

Tra

ined S

taff

Initia

l Support C

om

ple

te

Pilo

t Handover

Custo

mer A

ccepta

nce

Pro

ject C

lose-O

ut

Product Ready

Quality Reviewed

Work Finished

Work Started

Work Package Agreed

£200K

£110K

Time Now

Actual Cost

Planned

Cost

Value Earned

Predicted

Revised Cost

Predicted Cost

Over-Run

Predicted

Schedule

Over-Run

Projection of

Actual Costs

Original

Planned Cost


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The risk analysis will address other issues, of course, (eg staff turnover; projectmanagement expertise, third party suppliers etc) but if time is to be saved by the

compression of time-scales by overlapping naturally dependent activities, this presents a

very real risk to the success of the undertaking and may well involve some nugatory

expenditure. For these reasons the implications of resource smoothing at this point inplanning must be seriously considered.

Measuring The Business Benefits

When all the resource usage and cost information has been assembled, the Project

Business Case can be created (“Initiating A Project”) or reviewed (“Managing Stage

Boundaries”).

Figure 44: Simplified Business Benefits - Costs:Benefits Analysis & Investment Appraisal

A high-level Business Case would normally have been produced during the Feasibility or

Preliminary Study, based upon information contained in the organisation's Strategic Plan.

This initial business case would have been subsequently refined and, following approvalby Corporate or Programme Management, passed with the Project Mandate to the Project

Manager for formal Start-up and, following approval at the Project Initiation Meeting, the

Initiation of the project.

The main elements of the Business Case are the reasons for the project, and a Benefits

and Costs Statement. An optional Costs:Benefits Analysis and Investment Appraisal may

also be created to measure the Business Benefits of the project’s outcome. If thought to benecessary a Sensitivity Analysis may also be produced. A Risk Analysis and proposals

arising from it, recorded in the Risk Log, is also closely linked to the PRINCE Business

Case.

Essentially all costs are fed into the model and all tangible benefits added in. The result

will be a Cash-flow for the project. This is then discounted by the appropriate rate(currently 6% in Government, but often higher within the private sector) and the Dis-

counted Cash Flow identified. The areas of main interest are:

Year 0 1 2 3 4 5Costs : (10 0 ) (20) (20) (20) (40) (30)Benefit s : 0 40 8 0 10 0 10 0 10 0CashFlow: (10 0 ) 20 6 0 8 0 6 0 70Cumulat ed: (10 0 ) (80) (20) 6 0 120 190Discount Factor (@6 %) 1.00 .94 .8 8 .83 .78 .74Discount ed Cash Flow (10 0 ) 19 53 6 6 47 52Cumulat ed DCF (10 0 ) (81) (28) 38 85 137


89

♦ the point at which the project starts showing a positive return

♦ the overall return on the investment in the project (the Net Present Value).

Where a full Cost:Benefits Analysis and Investment Appraisal is not required by the

Project Board, a narrative statement of the Benefits should be produced. This lists all the

anticipated benefits but does not attach any specific financial value to them.

Project Plan Text

The plans described are used for the overall control of the project and provide a summary

of the planned work and expenditure.

To initiate the project (and to approve each successive Management Stage) the Project

Board will require a document which ties the complete plan package together and

describes the approach and general philosophy. This document is the Plan Text (alsoknown as the Plan Description, Plan Narrative or Executive Summary) and will be mainly

a narrative summary with the plans described above attached as appendices.

The Plan Text typically contains the following information:

♦ the plan pre-requisites (what must be in place in order for the plan to work - eg staff

recruited, users assigned, equipment installed and building work completed);

♦ the plan assumptions (the bases upon which the plans has been constructed - eg staff

rates, discount factors used etc);

♦ the plan risks (the specific areas of risk that have been identified and must be closely

monitored - eg overlapping activities, staffing concerns etc);

♦ the overall time-scale for the project and how it has been achieved;

♦ the impact of resource usage on this project on other projects, undertakings etc.

♦ the return on the investment and the overall business case related to project viability.

Management Stage Plans

The Management Stage Plan package has a similar structure and its production follows a

similar path to the Project Plan package. The Stage Plans are produced in the “Managing

Stage Boundaries (SB)” Process.

Short horizon, limited commitment, planning is a fundamental feature of PRINCE. The

aim is to provide an overall view of the likely project profile (via the Project Plan package)with a succession of short term limited commitments for the sponsor (via the Management


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Stage Plan documentation). The structure of the PRINCE 2 Stage Plan package is asfollows:

♦ Stage Product Breakdown Structure - listing all the Stage Products to be produced.

Product Descriptions must also be available (or produced) for all Stage Products.

♦ Stage Product Flow Diagram - listing the Products to be produced during the stageand the derivation paths.

♦ Stage Timed PERT Network - showing the Earliest Start/Finish Times, Float and

overall project timings.

♦ Stage Gantt Plan - This plan relates specialist activities against time-scales (typically

on a week-by-week basis) and summarises the level of control (frequency of

Checkpoints, Quality Reviews and another meetings required by the Project Board).

♦ Stage Resources Report- summarises the resource effort and costs for the stage.

Where there is no software support package in use, a Stage Resource Plan should be

provided to identify the effort and costs to be approved by the Project Board. It is

produced by taking the Stage Gantt Plan and creating a Transfer Sheet for eachresource. The Stage Resource Plan is usually constructed on a week-by-week

timescale and, in any case, must match the Stage Gantt Plan.

♦ Optional Stage Graphical Summary - provides a graphical view of the time:cost:achievement for the stage. This might be supplemented or replaced by and Earned

Value Analysis Plan.

♦ Stage Plan Text - ties together and summarises the above plans and will essentiallycover the stage plan pre-requisites, assumptions and risks. This narrative might be

incorporated into the Project Plan Description.

Initiate

SpecifyDesign

Build

TestTrain

Handover

Management

Stage 1

Management

Stage 2

Management

Stage 3

Start-Up

Project Brief

Project Approach

PIDInterview Users

Produce Spec

Outline DesignFinal Design

Agree Design

Figure 45: Stage Plan Derived From The Project Plan


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Team Plans

Team Plans will usually (but not necessarily) be required for all but the smallest of

projects. They drop the Stage Plans down to an increased level of detail in much the same

way that the Stage Plans reflect an increased level of detail of the Project Plans.

Team plans are optional within the PRINCE 2 Method and where they are produced they

will normally be prepared by the Team Manager within the “Managing Product Delivery

(MP)” Process, based on the authorised Work Package in consultation with the TeamMembers and agreed with the Project Manager.

The Team Plan Package, where produced, will be related to a specialist team working on aspecific Product or set of Products or they might be aimed at an individual working within

the project. Team Plans will often reflect the work to be carried out in a Technical Stage

within a Management Stage of the project.

Individual Plans

Individual Plans (sometimes referred to as Work-to Lists) are not required within

PRINCE 2 but may, at the Project Manager/Team Manager’s discretion, be drawn up for

individuals working on specified Products. The Individual Plans, where used, will be

derived directly from the Detailed Gantt Plan and will form the basis for discussion of

progress at the regular (usually weekly, but at the regularity agreed within the authorisedWork Package) Checkpoints.

The Individual Plan may comprise a detailed Bar Chart/Gantt Chart, Activity List, ormight only identify start and finish dates and Activity Status for specific Products.

PRINCE 2 Planning - Summary

There is a need within any project to produce plans in sufficient detail to derive

understanding of the way that objectives are to be achieved.

In the final analysis, control can only be exercised at the level that is enabled by the plans.

If a project is planned only at a high level then detailed control cannot be effected. Therecommended approach is to plan in detail to get a full understanding of what is involved

and then to select an appropriate level of control based on what is known about the project.


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Chapter 5

UNDERSTANDING THE

CONTROLS COMPONENT


94

Introduction To Controls

The main mission of any project management method is to enable management at all

levels to exercise control over what has been planned and approved. The approved plans

reflect what is required to be achieved and the structure of controls enables managers to

reach informed decisions about committing resources and giving approval to proceed.

Regular and formal monitoring of actual progress against the approved plan is essential to

ensure the timeliness, cost control and quality of the system or undertaking beingdeveloped. PRINCE 2 provides the essential support structure of Management and

Product-oriented controls to monitor progress, supported by a reporting procedure which

enables re-planning or other appropriate corrective action to be taken.

PRINCE 2 controls fall into three main categories – Management Controls, Quality

Controls and Configuration Controls; the latter two are covered in separate Chapters in

this book.

Management Controls

Most PRINCE 2 management controls are “event-based”; this facilitates management-

by-exception and helps reduce the overall cost of project control by limiting managers’

effort to occasions when decisions are really needed.

PRINCE 2 provides a structure of management controls to be applied throughout the

project. These controls cover all aspects of project activity and, at the highest level, allow

the Project Board to assess project achievement and status prior to committing furtherexpenditure.

Controls are applied through measuring the progress towards production of a set ofpre-defined outputs (Products or Deliverables). The overall structure of Management

Controls is defined at Project Initiation (IP4) to ensure that the project is set up with clear

Terms of Reference, incorporating agreed and measurable Objectives and an adequate

management structure.

Controls are applied at Project Board, Project Manager and Team Manager levels.

Configuration control and Quality control is exercised by the Project Manager and TeamManagers. The main Project Board controls are:

♦ The Project Initiation Meeting (establishing whether there is a worthwhile and

viable project);

♦ Project Initiation & the Project Initiation Document (PID) (fixing a baseline forthe project);

♦ End Stage Assessment (ensuring the project is still viable and authorising progress

to the next Management Stage through the approval of the next Management StagePlan);


95

♦ Tolerance (providing time and cost margins within which the Project Manager has

discretion to deviate from the approved plan without seeking authority from theProject Board);

♦ Mid-Stage Assessment (where significant deviations from the approved plans are

considered and an Exception Plan approved);

♦ Project Closure (authorising close-down of the project after ensuring that all theproject’s Products have been delivered to the required quality standards and that

customer acceptance has been obtained);

♦ Highlight Reports (regular, normally time-based, reports from the Project Managerto Project Board members to keep them informed of the progress and status of the

current Management Stage);

The Project initiation Meeting

The pre-project Process “Starting Up A Project (SU)” seeks to answer the question “Do

we have a worthwhile and viable project?”. Creation of the Project Brief, Risk Log,Project Approach, Initiation Stage Plans, Organisation Structure and Role definitions

contribute to answering this question and formal acceptance that there is a worthwhile

project on offer is confirmed by the Project Board at the Project Initiation Meeting (PIM).

There is no real need to hold a formal meeting for all projects but the formality that a

meeting provides will be appropriate for major investments. The PIM is a control functionof “Authorising Initiation (DP1)” which sits in the “Directing A Project (DP)” Process.

The “official start” of the project occurs following this approval which enables the Project

manager and team to begin to create the elements of the Project Initiation Document (PID)during the required Initiation Stage of the project.

Figure 46: Pre-Project and the Project Initiation Meeting

• Project Brief

• Risk Log

• Project Approach

• Organisation

• Initiation Stage Plan

Initiation

Stage

Project Initiation

MeetingDo we Have

A Worthwhile&

viable Project?

Stage 2

End Stage

Assessment

End Stage

Assessment

The Project Initiation

Document Provides

the Project Baseline

Pre-Project ........ The Project Lifecycle .........................

The End Stage Report

confirms the result of the

last Stage and reports on

the overall project viability.

It also contains the plans

for the next Stage.


96

Project Initiation & the Project initiation Document (PID)

Project Initiation ensures a firm foundation and provides a positive start to the project,

ensuring that the terms of reference, objectives, plans and controls, business risks, benefits

and financial return, quality plans, organisation structure and job definitions are clearly

defined, published, understood and agreed.

Every organisation using PRINCE 2 as the basis for its project management standards

should create, agree and publish a suitable specification for its content and quality criteria– this will normally take the form of a Product Description and a suitable start-point is the

outline contained in Appendix A17 of the PRINCE 2 Method manual.

This Management Product is very important to the project and is the result of two

Processes - “Starting Up A Project (SU)” and “Initiating A Project (IP)”. The key output

is the Project Initiation Document (PID) which, when approved, is a reference document

used to Baseline the project.

The PID is used throughout the project as a reference back to the original intentions and

management objectives. During the “Closing A Project” Processes, the PID is used to

reference the original Acceptance Criteria and secure Customer Acceptance (CP1), and toprovide the statement of the original project objectives, scope and constraints for creation

of the End Project Report.


This is a mandatory management control and occurs at the end of each stage. It typically

consists of a formal presentation to the Project Board of the current project status, and

reviews the overall Business Case and risks. The vehicle used for this is the End StageReport.


End Stage Assessment (ESA)“Directing A Project” Process•Review the Outcome of Stage 1;

•Review the Project Plans;

•Review the Business Case (Benefits & Risks);

•Preview the Plans for Stage 2.


the project up to the next End Stage Assessment.

“Managing Stage Boundaries” Process •Up-date the Plans for Stage 1;

•Up-date the Project Plans;

•Up-date the Business Case (Benefits & Risks);

•Prepare the Plans for Stage 2

Figure 47: Handling End Stage Assessments

The approval of the proposed plans for the next stage is also obtained. Project Board


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approval, with agreement by all the members, must be obtained before the project canproceed to the next stage.

Attendees at an End Stage Assessment

The attendees at an End Stage Assessment will be as follows:

The Project Board members (attendance should not be delegated to someone else except

in exceptional circumstances; where a Project Board member finds it necessary to send arepresentative rather than attend personally, the representative must be empowered to take

decisions on behalf of the Project Board member. Frequent delegation of attendance

should provoke the Executive to consider replacement of the non-attending Project Boardmember).

The Project Manager (the Project Manager is not a member of the decision-making

Project Board but must attend to report to the Project Board and to take direction).

Project Assurance (to confirm that project management standards are being observed and

that “all is well” with the project. This function is essentially one of “reassurance”).

Project Support (to take care of the administrative arrangements and record the End

Stage Assessment).

In addition to the above, the Project Board and Project Manager may invite any other

person or representative of any organisation who may be able to assist in the Project

Board’s decision making process. These might include Team Managers, Team Members,Policy Advisors, Suppliers and Sub-Contractors.

ESA Agenda

Although PRINCE 2 does not specify a specific agenda for running ESAs, the following

suggested agenda will help in preparing for this important Project Board control:

Item 1: Introductions (if external people are present for the first time).

Item 2a: Project Manager’s Report on the Current Management Stage.

Item 2b: Project Assurance report on the Current Stage.Item 2c: Discussion, Questions and Acceptance of Project Manager’s Report.

Item 3a: Project Manager’s Report on the Overall Project:

- Project-Level Products – Added/Removed.- Timescale – Current/Forecast to Completion/Variation + Reasons.

- Costs/Effort – Current/Forecast to Completion/Variation + Reasons.

Item 3b: Project Assurance report on the Overall Project and Projections.

Item 3c: Discussion, Questions and Acceptance of Project Manager’s Report.


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Item 4a: Project Manager’s Report on the Business Case & Risks:- Business Case – Original/Current/Forecast/Variations + Reasons.

- Risks – Original/Current/Forecast/Variation + Reasons.

- Risk Log –Entries Removed; New Entries.

Item 4b: Project Assurance report on the Business Case & Risks.

Item 4c: Discussion, Questions and Acceptance of Project Manager’s Report.

Item 5a: Project Manager’s Proposals for the Next Management Stage.Item 5b: Project Assurance comments on the Proposals for the Next Stage.

Item 5c: Discussion, Questions and Acceptance of Project Manager’s Proposals.

Item 6: Discussion, Questions on Overall Situation. Agreement on FutureActions.

Item 7: Any Other Project Related Business (eg External Information WhichImpacts on the Project’s Future).

Item 8: Project Board Formal Sign-off of the Current Stage and Commitment tothe Current View of the Project Plan, Business Case and Risks.

Acceptance of the Next Management Stage Plans. + Thanks and Close.

Remember, the information to prepare the Project Board for the End Stage Assessment

will be contained in the End Stage Report, prepared in the “Reporting Stage End (SB5)”

Process which is part of “Managing Stage Boundaries (SB)” Major Process.


This Project Board control is held only to review a significant deviation from an

approved Management Stage Plan and to approve an Exception Plan produced, at the

request of the Project Board, following an Exception Report.

An Exception Report is produced by the Project Manager to alert the Project Board assoon as it is apparent that a significant departure from the approved plan is forecast.

The Exception Report records what has happened to cause the “significant departure” fromthe approved plan, the impact on the Management Stage, overall Project and its Business

Case. The plan will also recommend appropriate action to take the project to the end of

the Stage and, where possible, recover the situation.


99

Figure 48: Handling Mid Stage Assessments

The Exception Report may be triggered by a number of different events, sometimes

without much advance warning, but in most cases a deteriorating situation will be knownby the Project Manager and observed by Project Assurance. Where Project Assurance

become aware of a Management Stage in decline an immediate report must be made to the

appropriate Project Board member (or the Executive). The Project Manager shouldprovide advance warning to the Project Board members via the Highlight Report – it is

most important to “come clean” and not attempt to disguise or hide the situation in the

hope that something will happen to improve matters – it invariably won’t happen! Whereappropriate the Project Manager should advise the Project Board members informally (by

telephone, e-mail, internal memorandum etc) rather than wait for the next formal report.

Tolerance

The measure of a “significant departure” is that the Tolerance stated by the Project Board

at the beginning of the management stage has been, or is likely to be, exceeded.

Standard Tolerance in PRINCE 2 is measured in terms of Time (Schedule) and Cost.There are other types of Tolerance which may be applied; these include Tolerance on

Quality, Technical Conformance, Scope and Risk. Tolerance need not necessarily be

equal – for example, it may be appropriate to set differential Tolerance of +0 and –4

weeks, coupled with cost Tolerance of +£10K and -£30K depending on where prioritieslie.


Mid Stage Assessment

(MSA)

“Directing A Project”Process•Consider the Exception Planat an unscheduled Mid Stage Assessment.

•Review the Problems with Stage 1;

•Review the Impact on the Project Plans;

•Review the im[pact on the Business Case (Benefits & Risks);

•Preview the revised Plans for the remainder of the Stage.


the Stage up to the next End Stage Assessment.

“Controlling A Stage”Process•Deviation from approved Stage Plans Forecast;

•Exception ReportCreated - Reasons; Impact; Options; Recommendation;

•Direction from Project Board .... Create an Exception Plan;

“Managing Stage Boundaries”Process•Produce an Exception Plan


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Figure 49: Tolerance - plus/minus 1 week; plus/minus 10%

The level of Tolerance is decided by the Project Board following recommendations by the

Project Manager. Tolerance is exercised mainly for a Management Stage but is also

appropriate at Project and Team Levels.

Project Tolerance is set by Corporate/Programme Management. The Executive member

of the Project Board is responsible for ensuring that Project Tolerance has been

established and recorded in the Project Brief. If at any time Project Tolerance is forecastto be exceeded it is the responsibility of the Executive to report to Corporate/Programme

Management and to obtain new direction (possibly re-baselining the project and

establishing new Project Tolerance levels).

(Management) Stage Tolerance is agreed by the Project Board and set by the Executive.

Stage Tolerance is always set within the context of the Project Tolerance – the ProjectBoard do not have any discretion to exceed Project Tolerance without authority from

Corporate/Programme Management. Where Tolerance is forecast to be exceeded the

Project Manager will convey this to the Project Board via an Exception Report which will

typically be followed up by an Exception Plan; alternatively, the Project Board maydecide to prematurely close the project.

Product Tolerance will usually be recorded in the Work package agreed between theProject Manager and the Team Manager responsible for the Products addressed by the

Work Package. Product Tolerance will be agreed in “Accepting A Work Package (MP1)”

and used as part of the basis for Checkpoint Reporting in “Executing A Work Package

(MP2)”. Obviously, Product Tolerance must not, individually or collectively, exceed theapproved Stage Tolerance.

Cost

Time

Planned Delivery & Total Cost

2 4 6 8 10 12 14 16 18 Weeks

£110K

£100K

£90

£80K

£70K

£60K

£50K

£40K

£30K

£20K

£10K

Plus 10% Tolerance

Minus 10% Tolerance

Plus 1 Week

Tolerance

Minus 1 Week

Tolerance

o

STAGE PLAN


101

Figure 50: Summary of the PRINCE 2 Exception Procedure

Tolerance is a major control for the Project Board, which allows its members to focus on

exceptions rather than be swamped with information about work which is proceeding toplan. Similar benefits also accrue for Corporate/Programme Management who are able to

leave responsibility for the project to the Project Board, sure in the knowledge that any

major departures will be brought to their attention. Similarly for the Project Manager who,by setting Product Tolerance with Team Managers/Suppliers, can direct attention to those

areas of the project which do need additional support. Project Assurance has a vital role to

play here in assuring the Project Board (and the Project Manager for Individual Products)

that all is “set fair”.

Approving An Exception Plan

As mentioned above, the Mid Stage Assessment (MSA) in PRINCE 2 is held only to

approve an Exception Plan, following the raising of an Exception Report. Obviously,

MSAs will not be planned in advance and will only be held exceptionally.

If the duration of a proposed Management Stage is deemed to be too long to be acceptableto the Project Board, then the Stage should be broken into more than one Management

Stage with an End Stage Assessment at each new break. The Mid-Stage Assessment

control is not appropriate for breaking up long duration Stages. Neither is the MSAintended to be the vehicle for “incidental progress meetings” held by the Project Board;

the PRINCE 2 Method makes no provision for such meetings. The End Stage Assessment

and the Mid-Stage Assessment are decision-based meetings and major Project Boardcontrols to ensure that all work being undertaken has the support and overt approval of the

key managers.

CS8

Escalating

Project Issues DP4

Giving

Ad-Hoc Advice

1: Exception Report

DP3

Authorising A Stage or

Exception Plan

SB6

Producing An

Exception Plan

2: Exception Plan Request)

3: Exception Plan

CS1 -

Authorising A

Work Package

4: Authorisation

To ProceedMid-Stage

Assessment

Premature Termination of Project


102

Project Closure

This provides a final review of the project's work is held, usually (but not necessarily) in

the form of a Project Board meeting. This is similar in structure to an End Stage

Assessment but relates to the entire project rather than a single stage. The objective is to

ensure that all the project Products/Deliverables have been satisfactorily delivered to theirstated quality standard and that the project documentation is complete.

A review of the contribution made by the project management standards and approachesused by the project will be carried out within the “Closing A Project (CP)” Process and a

Lessons Learned Report produced for consideration by the Project Board. The Lessons

Learned Report records what has been learned from using the PRINCE 2 projectmanagement and quality management standards for the project and is first created during

the “Initiating A Project – Setting Up Project Files (IP5)” process and “populated” as the

project progresses; it will eventually be sent, via Corporate/Programme Management to

the organisation’s manager responsible for quality.

Recommendations will also be made by the Project Manager for Follow-on Actions to

record and trigger any further work recommended following the closure of the project.Recommended Follow-on Actions will usually be derived from any outstanding Project

Issues, recorded on the Issues Log and from recommendations impacting on operational

and maintenance of the delivered outcome.

Highlight Reports

The Project Board is kept informed of the progress of the Management Stage (and the

project) against the approved plans via regular, time-related Highlight Reports. These are

prepared by the Project Manager using information derived from Checkpoint Reports and

following a review of the status of the Management Stage. They are usually providedmonthly, although their frequency will always be decided by the Project Board.

Highlight Reports are usually sent through the post or by e-mail; the objective is to

remove the need for unnecessary time-related Project Board meetings which consume theProject Board members’ valuable time, while still keeping them abreast of significant

developments. The format for Highlight Reports will typically include:

♦ a statement of the progress made during the last (usually monthly) period;

♦ a statement of problems during the last period, and how they were handled;

♦ confirmation of the Activities and Products to be worked on during the next period;

♦ a statement of the financial and schedule situation for the overall project and thecurrent Management Stage.

Some organisations specify that Highlight Reports should be kept to one side of A4 (or its

equivalent) and this makes very good sense.


103

Where the project is part of a Programme of work, separate Project and ProgrammeHighlight Reports will normally be produced and special attention must be paid to

reporting on interfaces with associated projects.

It is always good practice to agree a common format for Highlight Reporting where aProgramme Director (or Project Board responsible for a number of projects) has

responsibility for assessing Programme progress. A graphical representation is a useful

medium for achieving a common reporting structure, especially in a Programmeenvironment where the Programme Director may prefer to have a regular, time-based

meeting where individual project Managers present their Highlight Report Summaries in

short time units. A suitable format which can be adapted for this purpose is the GraphicalSummary/Earned Value Analysis plan described in the “Understanding Planning” Chapter

in this book.

Checkpoint Reports

Progress on the work of a Team against the agreed Work Package is the subject of the

Checkpoint Report. Typically a Checkpoint Report will be created following a

Checkpoint (meeting) in the “Managing Product Delivery Process – Executing A WorkPackage (MP2)”. Its format and frequency will be agreed in “Accepting A Work Package

(MP1)” and it will generally mirror the information contained in the Highlight Report to

ease the task of reporting.

The Checkpoint Report is used to up-date the Management Stage Plans with “actuals” to

date and will ultimately be used as an input to the Highlight Report to inform the Project

Board of progress made.

Stages

Stages are partitions of the project with decision points at their conclusion, and sometimes

during their life.

PRINCE 2 differentiates between “Management Stages” (which equate to the commitment

of resources by the Project Board and a decision to continue with the project and authorityto spend) and “Technical Stages” which comprise sets of technical activities leading to a

stated Product.


104

Initiate

Specify

DesignBuild

TestTrainHandover

ManagementStage 1

Management

Stage 2Management

Stage 3

TechnicalStages

Project Review of Management Stage at



Figure 51: Management & Technical Stages

Technical Stages will often overlap and be run in parallel; they are normally planned andmanaged by Team Managers who report to, and take direction from, the Project Manager.

Management Stages will always run in series.

In the above diagram, the Technical Stages have been planned to run in parallel. Of

course, in a smaller project these might well be described as “Activities”; in medium to

larger projects, the Activities will often combine to provide the Technical Stages.

In only the most exceptional circumstances will authority be given for work to commence

on the next Management Stage before all the Products of the current Management Stage is

completed.


105

Chapter 6

UNDERSTANDING THE

STAGES COMPONENT


107

Introduction

Stages are partitions of the project with decision points at their conclusion and,

sometimes, during their life.

Management & Technical Stages

PRINCE 2 differentiates between “Management Stages” (which equate to the

commitment of resources by the Project Board and a decision to continue with the projectand authority to spend) and “Technical Stages” which comprise sets of technical activities

leading to a stated Product.

Figure 52: Management and Technical Stages

Technical Stages will often overlap and be run in parallel; they are normally planned and

managed by Team Managers (within the “Managing Product Delivery (MP1)” Process)who report to, and take direction from, the Project Manager. Management Stages, on the

other hand, will always run in series; they will overlap only in exceptional circumstances

and always only with the prior agreement of the Project Board.

In the above diagram, the Technical Stages have been planned to run in parallel. Of

course, in a smaller project these might well be described as “Activities”; in medium to

larger projects, the Activities will often combine to provide the Technical Stages. In onlythe most exceptional circumstances will authority be given for work to commence on the

Initiate

Specify

Design

BuildTest

Train

Hand-over

Management

Stage 1

Management

Stage 3

Project Board Review of Management Stage- End Stage Assessment

(ESA)


Management

Stage 2

Technical Stages


108

next Management Stage before all the Products of the current Management Stage iscompleted.

Management Stages

Each PRINCE 2 controlled project will contain at least two Management Stages - one

(the Initiation Stage) for planning the project and the other containing the “action” portion,or implementation of the project.

Management Stages enable the Project Board to control the release of funding for theproject and provide the major control for the project. This is known as “Limited

Commitment”.

Approval of each Management Stage commits the effort, cost and time resourcescontained within the Next Stage Plan (prepared in the “Managing Stage Boundaries (SB)”

Process). Project Board approval to each Management Stage is given in the context of

endorsing continuation of the overall project.

The important thing here is that Project Board members understand that the estimates of

effort, cost and time within the Project Plan are “soft” estimates only and certainly not castin stone. The originally approved Project Plan will be embodied in the approved Project

Initiation Document which will have been “frozen” at the time it was formally approved

(in “Authorising A Project (DP2)” Sub-Process) at the conclusion of the “Initiating A

Project (IP)” Process. Each Management Stage will culminate in an End StageAssessment (ESA), at which point the following options will be open to the Project Board:

♦ Continue into the Next Stage;

♦ Re-visit part (or all) the Current Stage;

♦ “Freeze” the project for a finite or an indeterminate period;

♦ Abort the project.

The Project Board should not treat lightly any proposal to commence the next

Management Stage before all the Products of the Current Stage are complete.

Exceptionally the Project Board may agree to this but the practice is dangerous and may

well result in nugatory expenditure.

Updating The Business Case

At the conclusion of each Management Stage, the Business Case must be reviewed and

updated. Specifically this will mean up-dating the statement of Business Benefits to

confirm that the project remains on track to achieve them. Where the Business Benefits

are supported by a Cost:Benefit Analysis, this must be re-assessed and the results reportedto the Project Board.


109

The Risk Assessment must also be reviewed and the Risk Log updated, minimally at thecompletion of each Management Stage.

Technical Stages

Technical Stages are quite different from Management Stages in that they will invariably

be planned to run in parallel, within one or more Management Stages. This saves time

within the Management Stage and enables the best use to be made of the available

resources.

Figure 53: Creating The Stage Plan From The Project Plan

In most major projects, Technical Stages will be present, planned and controlled by TeamManagers working directly for the Project Manager.

Typically Technical Stages will address specific specialist areas of the project such asWork Packages placed with Suppliers under the cover of formal contracts. There will,

however, also be room for Technical Stages for discrete parts of the project being

undertaken by internal resources, such as the creation of the Specification for the project’soutcome, as illustrated in the diagram. This work will best be planned and managed by a

customer or user.

Handling The End Of A Management Stage

Handling Management Stage endings is a straightforward task once the basic principles

of PRINCE 2 planning and control are properly understood. The main feature to bear in

InitiateSpecifyDesign

BuildTestTrainHand-over

ManagementStage 1

ManagementStage 2

ManagementStage 3

Start-UpProject BriefProject Approach

PIDInterview UsersProduce SpecOutline DesignFinal DesignAgree Design

Management Stage 1


110

mind is that as Management Stages must not run in parallel, some degree of planning forthe next Management Stage must be included within the current Management Stage.

PRINCE 2 planning allows any combination of activities to be planned and executed

provided authority for the work is obtained from the Project Board. It is, therefore, quite

acceptable to be working on Products which will be delivered in the next ManagementStage provided approval and authority has been given. This enables Management Stages

to “butt” against each other and avoids the need to stop work on the project while Project

Board members assess the content of the End Stage Report, updated Project Plans, updatedBusiness Case, and the Next Stage Plans.

Figure 54: Handling Management Stage Endings

The approach does mean that a risk is being taken that, should the project be terminated at

the End Stage Assessment, some nugatory costs would have been incurred - but this risk is

well worth taking.

If, as is likely, the Project Board is unwilling to accept up to two weeks’ delay to the

project at every Management Stage end, this approach is the only real alternative. Failureto plan for Management Stage endings will inevitably put pressure on the Project Manager

to undertake some preliminary work on the next Management Stage without formal

authority to do so, and this must be avoided.

Stages - Summary

Management Stages are key control components within a PRINCE 2 project. Adequate

review procedures must be established to ensure that commitment of effort and funding

resources is fully under the control of the Project Board.

“Natural” Stage End

Time needed for the Project

Board to review the papers

& prepare for End Stage Assessment

Work, Effort & Cost

“at risk”

Stage 1 Stage 2


111

UNDERSTANDING THE

RISK MANAGEMENT

COMPONENT

Chapter 7


113

Introduction

PRINCE 2 places stress on the need for a strong and visible Business Case with the

Business Benefits and Risk Management being key features within this concept. No

specific techniques are suggested by the Method, although there are some pointers to

commonly available packages which will help, especially in the identification andmanagement of risk.

The risks perceived for any individual project will be summarised by the Project Managerat the time of Project Initiation, and will be reviewed and up-dated at each Project Review.

For many small, low risk projects it will be acceptable to provide only a narrative

statement of the perceived risks. However for higher profile, higher value, contentiousprojects a more formal risk assessment may be required by the Project Board.

Version 1 of the PRINCE Methodology referred to a Risk Analysis Checklist, originally

put together by CCTA at the request of the User Group. This Checklist has been modified,added to, and adjusted by SPOCE Project Management over a number of years and client

implementations, and is reproduced on the following pages.

An Excel Spreadsheet containing the Risk Analysis Checklist is available, upon request,

from SPOCE Project Management Limited (Telephone UK (+44) (0)1202-780740). It

provides a simple and structured way to identify the main risk areas for the project. It

should not be regarded as a definitive statement of the precise risks faced by the projectbut rather as an indicator of the areas that are more likely than not to cause problems! The

Risk Analysis Checklist expresses the project manager’s feelings about the likely risks

faced A completed example of the Risk Analysis Checklist is included at the end of thisChapter.

The final score derived from the Risk Analysis will provide guidance for the proposals putforward by the project manager. Any score in excess of 15 should be extracted and

proposals made to the Project Board for reducing or managing the risk. A suggested

format for risk management proposals recorded in a Risk Log is as follows:

Figure 55: Risk Log

Description of the Risk Risk Score Comment on the Risk Proposals

The Project Manager has

only limited experience of

managing a major project

of this type.

The Project Manager is

also responsible for 3

other mainstream projects

being developed concurrently

21 The Project Manager has many

on-going responsibilities which

are expected to take up much

time and effort (about 4 days

each week). He also has no

previous experience of planning

or managing a project of this

size and scope.

Proposal 1:

The Project Manager to

attend a Project Mgt.

training course.

Cost: £2,000

Proposal 2:

Buy in an experienced

Project Management

consultant to advise the

Project Manager and

provide support during the

first two weeks of the

project.

Cost: £4,000


114

Risk Ranges & Risk Factors

The risk factors of 2.00 and 2.60 within the Checklist relate to the assessed risk for the

project recorded in column (b) which is always rated on a scale of 0.10 to 4.00. The norm

for this scale is 2.00; any higher assessment would point to a higher than norm risk and

any lower assessment points to a lower than norm risk.

Figure 56: The Risk Management Analysis Ranges

Applying a risk factor of 2.00 to the assessed weighting in column (e) provides acomparative figure to that obtained when multiplying the weighting by the assessed risk

(column (e) x column (b), placed in column (f)). Therefore, if the result of applying the

risk factor of 2.00 to the weighting column (e), is less than that calculated for column (f)

then the particular component (or the whole assessment) indicates a higher than norm riskfor the project as a whole.

Conversely, if the application of the 2.00 factor to the assessed weighting (column (e)results in a higher score than that calculated for the total score in column (f), then the

component (or overall assessment) indicates a lower than norm risk.

The selection of a factor of 2.60 as the threshold for a “very high risk” project is somewhatarbitrary, based on experience and actual situations. The factor may be reduced or

increased as experience with project risk within an organisation is gained.

The risk Analysis Checklist includes a simple calculation for identifying the risk factor for

the project. Regular assessment should indicate a downward movement in the calculated

risk factor as the project progresses towards its conclusion. Any consistent upwardmovement should be investigated and reported to the Project Board Executive.

Lower Risk

Higher Risk

2.00“Norm Risk”

0.10 4.00

Recommended

“Norm” Range

1.00 3.00

2.00“Norm Risk”


115

Figure 57: Summary of the Impact of the Risk Scores & Weightings

In the example, if the assessed total score (column (f)) of 110 is less than 88 (having hadthe 2.00 “norm” Risk Factor applied), the overall assessment of risk is LOW.

If the assessed total score (column (f)) of 110 is greater than 114 (having had the threshold2.60 Risk Factor applied), the overall assessment of risk is VERY HIGH.

Updating the Risk Analysis

Where a formal risk assessment is carried out, the project will be re-appraised,

minimally, at each review of the project (in “Managing Stage Boundaries (SB)” Process)

and a log of the overall score maintained.

The Risk Analysis should also be up-dated and logged at regular intervals (possibly

weekly) for the first 4 to 6 weeks of the project following approval of the PID, especially

where the initial risk factor is in excess of 2.20.

(b) (e) (f) (e) x 2.00 (e) x 2.60

2 x 4 = 8 8 10.4 (higher than 8 = LOW RISK)




3 x 4 = 12 8 10.4 (lower than 12 = HIGH RISK)



3 x 7 = 21 14 18.2 (lower than 21 - HIGH RISK)

TOTALS: 44 110 88 114


116

Figure 58: Reducing Level Of Risk As The Project Progresses

Modifying The Risk Analysis Checklist

The best results will be achieved where the Risk Analysis Checklist is modified to reflect

the business, culture and types of project which predominate within the implementing

organisation. It will be noted that the Risk Analysis Checklist is particularly relevant to

the initiation of projects and contains comparatively little assessment of the on-goingcontrol and management of the project. It may well be that amendments to the standard

checklist would benefit from focusing on the control aspects.

Risk

Factor Score

2.60 = 114

2.50 = 110

2.40 = 105

2.30 = 101

2.20 = 97

2.10 = 92.4

2.00 = 88

Very High Risk

High Risk

Moderate Risk

Low Risk

At Project

Initiation

At End of

Stage 1

At End of

Stage 2

Continuous Risk Assessment by the Project Manager


117

STANDARD RISK ANALYSIS CHECKLIST

The Risk Factors which affect the probability that the project will be completed on time and within the

agreed time and budget, and will deliver a quality-compliant End Product arise from six sources - Project

Management, The Project Staff, The Nature of the Project, The Maturity of the Development/Supplier

Organisation (Internal and External Suppliers), The Customer and the Contract, and Third PartySuppliers.

The project risks associated with each of these Elements are itemised and estimated below in the form of

statements typifying Low and High Risk on either side of a scale of 0.10 to 4.00. The “norm” range used

is 1.00 to 3.00 and values outside this norm have only been used exceptionally and an explanation is

provided.

The assessed risk score under column (b) has been multiplied by the weighting factor inserted under

column (e) to provide a total risk score (rounded) for each question posed. Individual risks scoring in

excess of 15 have been extracted to a Risk Log recording the identified risks & proposed actions.

A Risk Factor for the project has been calculated and this will provide a Baseline for measurement ofmovements in the project risk. A Risk Factor of 2.00 is the neutral measurement, greater than 2.0

indicates an increasing project risk; lower indicates a reducing project risk.

Element Ref

(a)

Low Risk

(b)

Score

(c)

High Risk

(d)

Suggested

Weight

(e)

Weight

(f)

Total

ProjectManagement

1 Full time, experiencedProject Manager

3.00 Part time, inexperiencedProject Manager

5 to 7 7 21

2 Customer Management

experienced and likelyto be active

3.00 Inexperienced Customer

Management - littleparticipation expected

4 to 6 5 15

Project

Staff3 Customer staff likely to

be supportive and fullyinvolved in the project

2.30 Little Customer staff

involvement expected andlittle contribution

3 to 6 3 7

4 High standard of

supervision & narrowspan of control in theproject team

1.50 Wide span of supervision

and control expected to bepoor

4 to 6 4 6

5 Good quality projectteam, experienced withthe right skills

1.50 Inexperienced project teamlacking the key skills

6 to 8 6 9

6 Staff assigned full time

to the project3.00 Staff have many other

responsibilities3 to 6 5 15

7 Low turnover of project

staff2.00 High turnover of project

staff4 to 7 7 14

8 Staff experienced at

Quality Reviews1.8 No experience of Quality

Reviews among staff4 to 6 6 11

9 An organisationalcommitment to quality

exists

2.20 Staff take little interest inachieving a Quality

Culture

4 to 6 6 13


118

Element Ref

(a)

Low Risk

(b)

Score

(c)

High Risk

(d)

Suggested

Weight

(e)

Weight

(f)

Total

Nature oftheProject

10 Typical project with astraightforwardlifecycle

2.20 A project lifecycle that hasa number of inter technicalrelationships

4 to 6 5 11

11 The project has no, or

few novel features2.30 Pioneering new

approaches are being tried

out in the project

6 to 8 5 12

12 Equipment beinginstalled by the projectis well known, tried and

tested

2.10 Equipment is untried and

its use in uncertain4 to 6 5 10

13 Current mainoperations will be onlyminimally affected by

the project

3.00 Significant impact oncurrent main operations by

the project

3 to 5 5 15

14 The Requirements are,or will be, well

established and welldocumented by theCustomer

2.00 Requirements are(expected to be) poorly

understood, documentedand presented by theCustomer

3 to 6 5 10

15 Little or no

modification needed toexisting technicalstandards

2.60 Extensive modification

needed to existingtechnical standards will beneeded

3 to 6 5 13

16 Little project work isbeing undertakencurrently

2.80 Other project work isbeing carried out inparallel with this project

3 to 6 5 14

17 There is littledependence ondevelopment facilitiesnot under the control ofthe project team

2.80 There is a dependence ondevelopment facilitieswhich are outside thecontrol of the project team

3 to 7 6 17

18 Project duration is lessthan 6 months or thereis only a small numberof workdays required

2.60 Project duration is longerthan 6 months or there is ahigh number of workdays

2 to 5 4 10

19 There is little or noconstraint on thecompletion date

3.00 There is a mandatorycompletion date stated bythe Customer

4 to 7 6 18

20 Plans and estimates are(will be) based onreliable data fromsimilar projects

3.00 Plans and estimates are(will be) based onunreliable data -essentially “green field”

4 to 7 6 18

21 Estimates have beenprepared using welltried and documentedstandards

2.60 Approximations have beenused based on unreliablestandards

4 to 7 6 16

22 This is the first orsecond attempt at thisproject - ie there is nohistory of consistent

failure

2.90 There have been two ormore attempts to completethis project - ie it has a

history of failure

4 to 8 7 20


119

Element Ref

(a)

Low Risk

(b)

Score

(c)

High Risk

(d)

Suggested

Weight

(e)

Weight

(f)

Total

23 Few CustomerDepartments will beaffected by the final

outcome

3.00 Many CustomerDepartments will beaffected by the final

outcome

4 to 6 5 15

24 The project work willaffect few Customer

sites

2.80 Many Customer sites willbe impacted by the project

work

3 to 6 6 17

25 Sites which the projectteam will visit are easilyaccessible

2.90 Sites are remote andinaccessible

3 to 6 6 17

26 There will be onlyminor impact on theCustomer’s day to daywork during the project

cycle

2.50 There will be significantimpact on the Customer’sday to day work during the

project

3 to 6 4 10

27 Well developed andunderstood ProjectManagement Standardswill be available to the

project team

1.50 Few Project ManagementStandards will be available

to the project team

4 to 7 5 7

Maturityof theOrganisation

28 There is a welldeveloped andunderstood Quality

Environment - ie anaudited QualityManagement System

1.80 Quality Management is ill

defined and/or not visible4 to 7 5 9

29 Clear delegation ofauthority is practised bymanagement

2.00 There is strict centralmanagement control withlittle empowerment ordelegation

3 to 6 5 10

30 Project Staff will wishto make use of thepublished ProjectManagement Standards

2.00 Project Staff are notexpected to utilise anyProject ManagementStandards that exist

3 to 6 5 10

TheCustomerand the

Contract

31 The Customerdemonstrates a fullunderstanding of theRequirement and itsimpact

1.90 The Customerdemonstrates a poorunderstanding of theimpact of the Requirement

4 to 7 6 11

32 There will be little or nomodification needed tothe Customer’s existing

facilities

2.20 Extensive modification tothe Customer’s existingfacilities is expected

3 to 6 5 11

33 An agreed contract is inexistence

3.00 No formal contract is yet inplace

4 to 7 6 18

34 There have beenprevious dealings withthe Customer andprevious contracts havebeen brought to a

satisfactory conclusion

1.80 There have beendifficulties when dealingwith this Customer onearlier contracts

3 to 7 6 11


120

Element Ref

(a)

Low Risk

(b)

Score

(c)

High Risk

(d)

Suggested

Weight

(e)

Weight

(f)

Total

ThirdPartySupplier

35 Suppliers are known,approved and have asatisfactory track

record

2.00 The Suppliers are new andlittle is known about theircapabilities

4 to 8 6 12

36 Only one, wellestablished, approvedSupplier will be used to

provide the services

2.00 Multiple Suppliers (withSub-Contractor elements)

are anticipated

3 to 6 6 12

37 Suppliers have anestablished StructuredProject ManagementMethod based on

PRINCE or similar

2.00 Supplier projectmanagement arrangementsare ad-hoc with little

visible definition

3 to 6 6 12

38 A Supplier contract is in

existence1.50 Informal arrangements

only exist4 to 7 6 9

39 The main Supplier has afully audited QualityManagement System to

ISO9001

1.50 The main Supplier has nopublished Quality

Management System

4 to 7 6 9

40 The future level ofSupplier performance isexpected to be excellent

1.80 The future level of Supplierperformance is un-assessable because toolittle is known

3 to 6 6 11

TOTALS 214 494

SUMMARY

The project is assessed as LOW RISK if 494 (Column (f) Total) is LESS than 428 (Column (e) x 2.00)

The project is assessed as VERY HIGH RISK if 494 (Column (f) is MORE than 556 (Column (e) x 2.60)

The RISK FACTOR for the project is 2.31 (Column (f) total divided by Column (e) total)

The Project is assessed as HIGH RISK at this time.

nb: A Risk Factor of less than 2.00 indicates a LOW RISK project.

A Risk Factor between 2.00 to 2.20 indicates a MODERATE RISK project.

A Risk Factor between 2.20 to 2.60 indicates a HIGH RISK project.

A Risk Factor in excess of 2.60 indicates a VERY HIGH RISK project.


121

UNDERSTANDING THE

QUALITY MANAGEMENT

COMPONENT

Chapter 8


123

PRINCE 2 & BS/EN/ISO9001

PRINCE 2 has been designed to comply with the BS/EN/ISO9001 Quality Management

Standard and the method contains a section relating its content to each section of the ISO

Standard.

BS6079, the Project management Standard, is also reflected within PRINCE 2. ISO9001,

BS6079 and PRINCE 2 are all Process-driven; the foundation for quality and effective,modern project management is therefore integral and inherent in PRINCE 2.

The Method assumes that a PRINCE 2 managed project will be carried out within a

published quality environment with defined standards and procedures. The PRINCE 2Manual contains a fairly detailed review of all parts of ISO9001 and states the extent to

which each of the parts of the full ISO standard is met by PRINCE 2.

Quality Management

Figure 59 : The Quality Structure

The prime aim of Quality Management within a project environment is to ensure that the

quality expected by the customer is delivered within the project and extends beyond

delivery of the outcome.

Quality Management System

Organisation Structure

Procedures

Processes

Quality Policy Statement

Quality Manual

Quality Assurance

Set up & Audit of Quality Management System

Quality Planning Quality Control

* Objectives & Requirements

* Overall Approach

* Project Quality Plan

* Stage Quality Activities

* Measurement Against

Quality Criteria

* Measuring Against

Requirements


124

Figure 53 summarises the main components of a quality structure. The PRINCE 2 Methodprovides specific guidelines for Quality Planning and Quality Control, with the process

“Planning For Quality (IP1)” taking place very early in the life of the project and

planning for quality within each Product or Deliverable being a major part of “Planning A

Stage (SB1)” as the project proceeds.

Specific Product quality planning occurs with the creation of a Product Description for

each project-level and Management Stage-level Product. The vehicle for this is the

Product Description which states the Quality Criteria, type of quality check and the peoplewho need to be involved.

Quality Control is effected in the most sensible way for the Product under scrutiny and the

organisation. PRINCE 2 includes the technique of Quality Review to provide the means ofassessing a Product against its stated Quality Criteria but leaves selection of the most

appropriate means to control quality to the Project Manager and Project Board.

Of course, this puts much emphasis on getting the Product Description right in the first

place, especially the Quality Criteria which will form the basis of acceptance, or not.

Customer Quality Expectations

These must be reflected in the PRINCE 2 project environment. Ideally they will be stated

within the Project Mandate, but will, in any event, be included in the Project Brief(“Starting Up A Project (SU)” Process) and expanded, if necessary, in the Project

Initiation Document (“Initiating A Project (IP)” Process).

The results of the quality planning activity must be integrated into the timescale and

resource plans at each level. Just as quality must be built into the Products, so must qualitycontrol be built into the plans. Within PRINCE 2, Planning for Quality within the project

takes place predominantly in the “Initiating A Project (IP1)” Process where the Quality

Management Systems of both the Customer and the Supplier are used to prepare afoundation of quality for the project.

This does not, of course, mean that quality matters are taken into account only during this

Process; quality is a component which takes prominence throughout the life of the projectand fits closely with the Quality Review Technique discussed later in this publication.

Quality Aspects For Suppliers & Sub-Contractors

PRINCE 2 assumes a Customer:Supplier relationship where the total project outcome

may be undertaken, under contract, by an external supplier; in most projects, there will bethe need to buy in components or services from external sources. In these situations,

control over quality takes on further importance as the procedures and staff used to carry

out the quality control function is outside the direct control of the Project Manager. Theapproach used within the Method is to provide the “supplier” (internal or external) with a

clear statement of what is wanted, the quality standard that must be adhered to and the

reporting requirements, in the form of an authorised Work Package.


125

The authorised Work Package may take the form of a formal contract or, where thesupplier of the Product or service is internal, a memorandum. The typical content for an

Work Package is:

♦ Date

♦ Team or Individual or organisation authorised to carry out the work

♦ Description of the Work Package (Product Description)

♦ Extract from the Management Stage Plan

♦ Statement of joint agreement on effort, costs, start date and end date

♦ Any specific techniques, processes or procedures that are to be employed

♦ Any interfaces that must be addressed before, during and at the conclusion of the work

♦ Any constraints to be observed

♦ Reporting Arrangements - timing, content, responsibilities

♦ Quality Checking arrangements

A copy of the relevant Product Description(s) will always accompany the authorised WorkPackage; this will contain the specific Quality Criteria and checking arrangements that

must be observed.

Work Packages are authorised by the Project Manager in the “Controlling A Stage (CS1)”

Process and passed to the supplier in the “Managing Product Delivery (MP1)” Process fordiscussion where necessary and agreement before work commences. Completed Work

Packages (Products/Deliverables) are delivered back into the commissioning organisation

on completion of the work. Completed Work Packages should always be complete andQuality Reviewed in accordance with the agreed Work Package. Where there are

difficulties with the quality of supplier’s products, it will be necessary to set up additional

quality review/control arrangements within the customer’s organisation. In such cases asmoothly working Configuration Management system is essential in order to track down

“offending” suppliers and take remedial action.

Quality Management - Summary

Action must be taken at project planning time (within the “Initiating A Project (IP1)”

Process) to ensure that the project can deliver its Products to the quality standards required

by the customer. Quality Criteria must be defined and agreed, and incorporated into a

Product Description for each major Product identified; a Project Quality Plan must bedefined, published and adopted; Quality Review procedures must be established and staff

trained; review activities must be properly resourced. Whatever action is proposed to

build quality into the project, the measures must be consistent with any published Quality

Management System (QMS) that is already in effect.


127

UNDERSTANDING THE

CONFIGURATION MANAGEMENT

COMPONENT

Chapter 9


129

Configuration Management - Introduction

A configuration is a logically related set of products which need to be managed as a

composite set. The “Configuration” to be managed may, therefore, be summarised as the

sum total of all the equipment, instructions, information used, and documentation which

together represent the total of the Products or Deliverables from the project.

Configuration Management Techniques

Configuration Management (CM) provides techniques and procedures to perform the

following functions:

♦ Identifying the individual items which are to be managed. These are referred to as

Configuration Items (CIs).

♦ Recording, monitoring and reporting on the current status of each Configuration Item

as its development progresses through its own specific development life-cycle.

♦ Filing all development documentation produced during the project life of the CIs.

♦ Distributing and recording holders of copies of all project documentation for all CIs.

♦ Managing Project Issues raised during the project.

♦ Managing change to all CIs, from receipt of a Project Issue Report, throughassessment of the impact of proposed changes, release of both the documentation and

the Product itself.

In PRINCE 2, Configuration Management is not optional. All the above functions arenecessary for successful projects. Without CM, managers would have little or no control

over the products their projects are producing. All the Products of a PRINCE project,

including documentation Products, Management and Quality Products should be con-trolled using a suitable Configuration Management Method (CMM).

Depending upon the sophistication of the method used, some or all of the following shouldbe observed; it should be possible to use the following list of criteria during the selection

process for a CMM method and/or support tool:

♦ Configuration Items must be able to be created, amended and deleted;

♦ Configuration Items must be capable of being uniquely identified;

♦ the owner of each Configuration Item must be able to be uniquely identified;

♦ the owner of a Configuration Item must be able to be changed, without necessarily

changing the Configuration Item itself;


130

♦ baselines must be capable of being established;

♦ configuration audits must be able to be performed;

♦ it should be possible to restore a Product (or related group of Products) to its state as

at a previous baseline, either temporarily or permanently;

♦ the placing of a Configuration Item in the system library must be documented;

♦ Impact Analysis must be able to be carried out to help assess the ramifications

involved in changing one or more configuration item;

♦ Configuration Items which are of interest to more than one project must be able to be

held centrally.

In order to aid impact analysis the CMM should also provide a structure defining the

relationships between the configuration items, so that no configuration item is changedwithout triggering a check for possible ramifications in its neighbours.

CM Activities

The word “configuration” has in the past been associated mainly with equipment and the

term “Configuration Management” was originally applied to the control of hardware

development and production. Nowadays, however, it is internationally accepted thatConfiguration Management can be and needs to be applied to all elements of a project.

In PRINCE 2, the term Configuration Management refers essentially to the managementof project Specialist Products and the associated Documentation.

Configuration Management consists of four basic activities which together assist in the

management and control of development projects:

♦ Configuration Identification;

♦ Configuration Control;

♦ Status Accounting;

♦ Configuration Audits.

Configuration Management is a service function which assists in making both thespecialist and managerial activities more effective. Effectiveness of the CM processes

increases in proportion to the degree that the discipline is part of the normal day-to-day

activities of everyone involved in the project.

Configuration Management practices offer support to the specialist activities as well as

providing management with the information necessary for controlling Products as they are

produced by the project teams.


131

Configuration Management oversees all the Products of a project by controlling access tothem and by maintaining records of their status. Operation of Configuration Management

will benefit from the appointment of a Configuration Manager or Configuration Librarian

as custodian of master copies of all project Products. This role can be combined with the

Project Support role where appointed. Where no specific appointment has been made, andwhere a Project Support role has not been confirmed by the Project Board, the Project

Manager is responsible for Configuration Management of the project’s Products.


133

UNDERSTANDING THE

CHANGE CONTROL COMPONENT

AND

CHANGE CONTROL TECHNIQUE

Chapter 10


135

Change Control - Introduction

There are three types of changes which can be raised within a project under a PRINCE 2

controlled project; they are used to document desired change to, or some failure in, the

project's products; they are:

♦ Project Issue;

♦ Off-Specification;

♦ Request for Change.

This chapter is written on the assumption that exceptions will be controlled by a

Configuration Manager. If no such role has been allocated, control of exceptions will be

the responsibility of the Project Manager or Project Support, where appointed.

Project Issue

A project Issue is used by anyone to raise issues relating to the project. The subject of a

Project Issue is limited only in so far as it must in some way relate to the project, it may:

♦ address a specialist or technical problem, for example:

♦ Perceived errors in the project's products;

♦ Perceived failures of a current representation of the products to meet User

Requirements;

♦ An identified inconsistency between one representation of a Configuration Item

and any of its earlier representations;

♦ Ideas for improvements in design, functionality, customer interface, documentation,

standards etc;

♦ Identification of improved Business Benefits, proposals to reduce the risks;

♦ Or, alternatively, it may be to address a management issue, perhaps related to

budgets, plans, schedules or projected staff or skill shortages.

Project Issues are often raised during the testing or operation phases of the project, but can

be raised by anyone, at any point during the project. Changes to Products after completion

and hand-over of the project outcome (ie after project closure) will not be subject to the

project's change control procedures, but will be dealt with in accordance with the organi-sation's normal maintenance and enhancement procedure standards. Errors discovered at

a Quality Review are only noted on a Project Issue (Report) if the error relates to an item

other than that which is being reviewed, or an error which is unlikely to be corrected viathe normal Follow Up procedures.


136

At the end of the project all Project Issues should be closed (ie signed off, indicating thatthe issue has been resolved, possibly by transfer to one of the other two change categories,

Request For Change or Off-Specification).

The Issues Log, which is used to record each Project Issue, allocate a unique referenceand provide a summary of the status of all Project Issues raised, should be provided to the

Senior User/Customer at each End Stage review for prioritisation of outstanding Project

Issues. This might involve the Senior User in “canvassing” the other Project Boardmembers to provide the resources necessary to action outstanding Project Issues.

Off Specifications

An Off-Specification is used to document any situation where any project outcome fails

to meet its specification in some respect. The error(s) it describes are less likely to be

corrected and, as a consequence, are more likely to remain in the delivered output of theproject. For this reason Off-Specifications are normally filed in the approved

Configuration Items File.

Off-Specifications are normally raised by the Project Manager, Team Manager, or Project

Board after analysis of received Project Issue Reports. The method does, however allow

the originator to identify an issue as an Off-Specification at the time it is formally raised.

If a number of Off-Specifications remain outstanding at the conclusion of the project, it is

in order to bring them forward as the basis for a separate enhancement project after the

main project has been formally signed off and accepted into the business environment.

Request for Change

A Request For Change is a means of recording a proposed modification to the delivered

output of the project and is raised by the Project Manager, Team Manager or Project Board

as a result of either analysis of a Project Issue or the decision to rectify a deficiency

currently recorded in an Off-Specification. As with the Off-Specification, the originator ofan issue may identify it as a Request for Change - this will be most appropriate in

circumstances where an error has been discovered.

Requests For Change are not used to record deficiencies in an otherwise working system.

Deficiencies are documented on the Project Issue Report and Off-Specification Report

forms. All RFCs will be actioned and cleared prior to project closure.

Change Control Forms and Documentation

No forms are provided within the PRINCE 2 Method for managing changes; however

suitable forms are available from within the IBM PRINCE Environment and the SPOCEProject Management Launch Pad.


137

Change Control - Summary

More information on the PRINCE 2 change control procedures are contained in the

PRINCE 2 Manual. It is advisable, however to check with the Quality Manager, Project

Support Office or Project Assurance representative as existing, effective, change-control

procedures are often (rightly) maintained after the adoption of the PRINCE 2 standard.

At the conclusion of the project all Requests for Change must be cleared. This will

normally be through completion of all outstanding work on them but, exceptionally,Requests for Change still not started or incomplete may be transferred to an enhancement

project. This device can be used to effect customer and business sign-off of the main

project. Some Off-Specifications may be present throughout the whole life of the outputof the project. Outstanding Off-Specifications should be considered for an enhancement

project, possibly on a year-by-year basis.

Figure 60: Suggested Change Control Procedure Based On PRINCE 2 Principles

A diagram summarising a suitable change control procedure is as follows. Each stage ofthe process is logged into the Issues Log. On completion of the project all the Project

Issues must be resolved - either by rejection or conversion to a Request for Change, or an

Off-Specification. However, the originator may identify the particular category of ProjectIssue at the time it is raised. The summary provides an enhancement of the PRINCE 2

suggested procedure.

* Good Ideas

* Errors

* Departures From Agreed Specification

* Resource Changes

* Specification Changes

Project Issue(Request for Changeor Off-Specification)

Originator Raises A

Sent to Project Support

Logged byProject Support

Reviewed by Project Manager

Project Issues Log

* Slippage/Budget Changes, exceeding Tolerance or

affecting other projects within the Programme

= Decision by Project Board (Exception Report)

OR ....

*Changes Within Tolerance = Decision by Project Manager

and action taken to implement the change.

Project Issues Log Up-dated

Notify OriginatorCopy returned

to confirm receipt


139

Chapter 11

UNDERSTANDING THE

PRINCE 2 PROCESSES


141

Introduction To Processes

PRINCE 2 focuses on the Processes that are needed to manage a successful outcome for

any project. The Processes identified in PRINCE 2 represent the minimum content for a

PRINCE-compliant project but this certainly is not intended to encourage slavish

following of any or all of them! The key to successful management of a project is toensure that each of the Processes identified within a PRINCE 2 controlled project are

addressed in one form or another; how each Process is actually interpreted as a project

management procedure is left to the implementing organisation, or where anorganisational-wide implementation has not been made, the Project Board and Project

Manager.

Of course, the concept of a process-driven approach is not new; Project Managers have

always used the processes of starting, managing and closing their projects, and senior

managers have always been involved in the processes of direction and decision making

whether they realised it or not! PRINCE 2 formalises these implied processes and setsthem into the context of a successful management.

The Processes

There are eight major Processes in all, identified within the PRINCE 2 methodology; the

eighth Process of “Planning (PL)” is used by all the other Processes. The eight major

Processes are:

♦ Starting Up A Project (SU)

♦ Initiating A Project (IP)

♦ Directing A Project (DP)

♦ Managing Stage Boundaries (SB)

♦ Controlling A Stage (CS)

♦ Managing Product Delivery (MP)

♦ Closing A Project CP)

♦ Planning (PL)

The Planning Process is common to all the others, making a major contribution to“Initiating A Project” where the whole project is planned, “Managing Stage Boundaries”

where the next Management Stage of the project is planned, and “Managing Product

Delivery” where the work of teams and each individual Team Member is planned. Inaddition to these Processes, “Planning” also makes a contribution to all others


142

The PRINCE 2 Process Model

The overall structure of the PRINCE 2 Process Model can be summarised as follows:

Figure 61: Structure Model of the PRINCE 2 Process Model And Major Product Flows

* Request for Exception Plan

* SU1 - Appoint Exec & PM

* SU2 - Design A Team

* SU3 - Appoint A Team

* SU4 - Prepare Brief

* SU5 - Prepare Approach

* SU6 - Prepare Initiation Plan

* IP1 - Plan Quality

* IP2 - Plan Project

* IP3 - Refine Bus Case & Risks

* IP4 - Set Up Controls

* IP5 - Set Up Files

* IP6 - Assemble PID

* DP1 - Authorise Initiation

* DP2 - Authorise Project

* DP3 - Authorise Stage or Exception Plan

* DP4 - Give Ad-Hoc Direction

* DP5 - Project Close

* CS1 - Authorise Work Package

* CS2 - Assess Progress

* CS3 - Capture Project Issues

* CS4 - Examine Project Issues

* CS5 - Review Stage Status

* CS6 - Report Highlights

* CS7 - Take Corrective Action

* CS8 - Escalate Project Issues

* CS9 - Receive Completed Work Package

* MP1 - Accept Work Package

* MP2 - Execute Work Package

* MP3 - Deliver Work Package

* SB1 - Plan A Stage

* SB2 - Up-date Project Plan

* SB3 - Up-date Business Case

* SB4 - Up-date Risk Log

* SB5 - Report Stage End

* SB6 - Produce Exception Plan

* CP1 - Decommission A Project

* CP2 - ID Follow-on Actions

* CP3 - Project Evaluation Review

SU

IP

DP

CS

MP

CP

* Project Brief

* Project Approach

* Organisation

* Plan for Initiation Stage

* Authorisation

To Proceed

*Draft Project Initiation Document (PID) * Trigger for

Next Stage Plan

* Next Stage

Plan

* Exception

Plan

* Trigger - Next Stage Plan

* Authorisation

To Proceed

* Direction

* Highlight

Reports

* Customer

Acceptance

* End Project Report

* Project Evaluation

* Lessons Learned

* Follow-on Items

* Post-Project

Review Plan

* Work Package

+ Confirmation of Acceptance

* Checkpoint Reports

* Project Start Notification

* Project End Notification

* Premature

Close

PL

* Completed Work Package

* Project Issues

* Project Mandate

Archive Files

* Trigger - End Project

* Product Based Planning

* Exception

Reports

* Info from

External

Sources &

Feedback

*Requests For

Advice

SB


143

Each of the major Processes has associated Processes which drive the management of the

project through the use of Components and Techniques, The Processes do not link with

any required way of achieving the required outcome; this enables the use of any

techniques which are appropriate to the business and reflects the flexibility which comesas part of the PRINCE 2 package.

Major Processes and Processes

Each of the eight major Processes has a number of Processes which are used to get the job

done. A table relating each Process to its parent, major Process is useful to illustrate

where each Process resides within the overall Process Model and a summary of each majorProcess and its “children” is particularly helpful to anyone intending to take the APM

Group PRINCE 2 Examinations.

The main objectives of each of the eight major Processes are summarised as follows:

♦ Starting Up A Project – Gathering the basic information needed to start the project.

♦ Initiating A Project – Ensuring that the key decision makers understand what is

involved and obtaining agreement and commitment to a formal baseline for theproject.

♦ Directing A Project – Decision making on behalf of the project by senior managers

(in PRINCE terms – “The Project Board”).

♦ Controlling A Stage – Day-to-day project management and controlling the project by

the Project Manager, on behalf of the Project Board.

♦ Managing Product Delivery – Creating, modifying and obtaining the Products or

Deliverables.

♦ Managing Stage Boundaries – Taking stock of the current situation and getting ready

for the next part (Management Stage) of the project.

♦ Closing A Project – Ensuring the project has properly completed prior to formalclosure of the project by senior management.

♦ Planning – Planning steps that are common to all the Processes except “Controlling

A Stage” and “Directing A Project”. Plans are, however, used by all the Processes.

These Processes link to the Components and Techniques included in the PRINCE 2

Method to provide a comprehensive “best practice” Project Management Method.


144

A summary chart of Processes and Sub-Processes is shown below:

Parent Process Sub-

Process

Sub-Process Name

Starting Up A Project SU1 Appointing A Project Board Executive & Project Manager

(SU) SU2 Designing A Project Management Team

SU3 Appointing A Project Management Team

SU4 Preparing A Project Brief

SU5 Defining Project Approach

SU6 Planning An Initiation Stage

Initiating A project IP1 Planning Quality

(IP) IP2 Planning A Project

IP3 Refining The Business Case and Risks

IP4 Setting Up Project Controls

IP5 Setting Up Project Files

IP6 Assembling A Project Initiation Document

Directing A Project DP1 Authorising Initiation

(DP) DP2 Authorising A Project

DP3 Authorising A Stage Or Exception Plan

DP4 Giving Ad-Hoc Direction

DP5 Confirming Project Closure

Controlling A Stage CS1 Authorising A Work Package

(CS) CS2 Assessing Progress

CS3 Capturing Project Issues

CS4 Examining Project Issues

CS5 Reviewing Stage Status

CS6 Reporting Highlights

CS7 Taking Corrective Action

CS8 Escalating Project Issues

CS9 Receiving A Completed Work Package

Managing Product MP1 Accepting A Work Package

Delivery MP2 Executing A Work Package

(MP) MP3 Delivering A Work Package

Managing Stage SB1 Planning A Stage

Boundaries SB2 Updating A Project Plan

(SB) SB3 Updating A Project Business Case

SB4 Updating The Risk Log

SB5 Reporting Stage End

SB6 Producing An Exception Plan

Closing A Project CP1 Decommissioning A Project

(CP) CP2 Identifying Follow-on Actions

CP3 Project Evaluation Review


145

Planning PL1 Designing A Plan

(PL) PL2 Identifying, Defining And Analysing Products

PL3 Identifying Activities And Dependencies

PL4 Estimating

PL5 Scheduling

PL6 Analysing Risks

PL7 Completing A Plan

Structure of the Individual Process Models

Each of the major Processes and Processes is described by reference to a common

formula:

The Fundamental Principles

♦ The reason(s) for the Process;

♦ The project management aims for the Process;

♦ Why the Process is fundamental to good project management practice and, therefore,

a requirement in any PRINCE 2-compliant project.

This section is a good first-step to understanding the rationale for the Process and what it

is trying to achieve.

Context

♦ The relationship with the other Processes and external activities. A Context Diagramis provided for each Process showing the flows of information into and out of the Process.

This section is particularly useful to provide a visual statement of the inputs, processes andoutputs as a quick guide.

Process Description

♦ An explanation of the objectives of the Process and a statement of the steps contained

within it. The steps identified are in no particular order and are not intended to be

comprehensive.

This section contains the “meat” of the Process and provides a fair commentary on what

the Process sets out to achieve, together with the means of achieving it. There is littleattempt to describe how the Process is expected to work in practice, as the PRINCE 2

Method addresses mainly “What” and “Why” with a much restricted “How” confined

mainly to the “Techniques” Section.


146

Responsibilities

♦ Identification of who should be held accountable for the successful conduct of the

Process, and responsible for its management.

Generic responsibilities (Project Board, Project Manager etc) only are provided and

implementing organisations need to look very carefully at assignment of key project

activities to specified personnel.

Information Needs

♦ The key information needed for the Process to function in such a way to meet its

objectives. The information needs identified might take the form of Products/Deliverables,

Plans, Reports, Decisions etc.

This section is particularly useful in understanding the flows of information into and out of

the Process. Read in conjunction with the Context Diagram, a good understanding of the

complete Input/Process/Output cycle can be obtained.

Key Criteria

♦ Identification of significant issues which will impact upon and affect the successful

working of the Process.

These criteria are generally straightforward and pose little difficulty in their understandingand implementation. They are important in that they represent the minimum standard for

any PRINCE 2-compliant project. In essence, any PRINCE 2-compliant project will

address all eight Processes in one form or another and each of the Processes will meet theKey Criteria stated here.

Hints and Tips

♦ Guidance on the application of the Process within a PRINCE environment; the method

recommends that this section be augmented by reference to specific situations encountered

during the use of PRINCE on projects within the implementing organisation.

The Hints and Tips contained throughout the PRINCE 2 Manual should not be viewed as

an integral part of the Method but rather as helpful guidelines.

Much of the PRINCE 2 Manual is given to describing the Processes using the above

headings. Understanding the structure of the Processes and their objectives is fundamental

to the successful use of the method. PRINCE may be likened to an organic structurewhich must be allowed to mature and adapt to fit changing circumstances and new

knowledge within the host organisation; up-dating the Process Models and descriptions,

especially with regard to the Hints and Tips section is recommended to achieve this.


147

Scalability

♦ All PRINCE controlled projects will address all eight major Processes in some form

and the key question to be posed is “How extensively should this Process be applied on

this project?”.

Each of the eight major Processes includes a section on “Scalability” which provides

suggested approaches to scaling the major Process to reflect the size and scope of the

particular project. A “Scalability” section is not included within each Process definitionbut the principles established in the major Process may be used to provide a suitable

solution.

Individual Process Summary Models

On the pages that follow are summaries of the inputs and outputs for each of the Processes

within the PRINCE 2 Method. The summaries also indicate the action performed on aProduct within the Process. The notation is as follows:

Product Created = [C]

Product Updated = [U]

Product Referenced and/or Reviewed = [R]

The Major Process Models shown at the beginning of each section are reproduced fromthe PRINCE 2 Manual, with minor amendments and corrections made.


149

Chapter 12

UNDERSTANDING THE

STARTING UP A PROJECT (SU)

PROCESS


151

Starting Up A Project (SU) - Introduction

This is the first Process within a PRINCE 2 managed project. A Project Mandate in the

form of a memo, formal or informal request will normally trigger this Process, although

there is no prescribed format.

Figure 62: Starting Up A Project (SU) Process

The “Starting Up a Project (SU)” Process provides a solution to the “ragged beginning”

concept that bedevils many projects. Just how a project gets under way is a question often

posed by managers who find that they are asked to carry out planning and preparatorywork by Customers but are warned against committing any resources without authority!

Quite a dilemma which PRINCE 2 seeks to bridge by the use of this Process.

The Process seeks to set up the project by creating clear objectives, set up a suitableProject Management Team, identify a realistic approach to the work to be done, and

planning for the next stage of the work (normally the Initiation Stage). The project

formally exists at the conclusion of this Process when the Project Board will be asked togive a “go/no-go” decision on whether there is the rationale, will and business need for the

proposed project. This decision will normally take place at a “Project Initiation Meeting

(PIM) which marks the formal start to the project.

Appointing a

PB Executive

and PM

SU1

Designing a

Project

Management

TeamSU2

Appointing a

Project

Management

TeamSU3

Preparing a

Project Brief

SU4

Defining

Project

Approach

SU5

Planning an

Initiation Stage

SU6

Authorising

Initiation

DP1

Planning

Quality

IP1

Assembling

a PID

IP6

Project

Brief

Project

Approach

Project

Management Team

structure and job

descriptions Project

Brief

Project

Mandate

Draft Initiation

Stage Plan


152

SU1 - Appointment of a Project Board Executive and a Project

Manager

To get any undertaking under way, there is a need for a decision-maker (the Project Board

Executive) and a planner (the Project Manager). As soon as the project is “floated” by thereceipt of a Project Mandate, these two appointments must be made by Corporate

Management. Between them they will arrange to set up the proposed project in an orderly

and structured way by creating suitable decision-support documentation comprising TheProject Brief, The Project Management Team, The Project Approach, and the Plan for the

Initiation Stage.

PROCESS INPUT & SOURCE PRODUCTS CREATED,UPDATED, REFERENCED OR

USED

OUTPUT TO

Project Board ExecutiveAppointment [C]

Designing A ProjectManagement Team(SU2)

SU1 –AppointingA ProjectBoardExecutive &ProjectManager

Project Mandate(CorporateManagement)

Project Manager Appointment [C] Designing A ProjectManagement Team(SU2)

Figure 63: SU1 Plus Inputs and Outputs

The appointment of the Project Board Executive and the Project Manager will allow a

number of Products to be started. Although the PRINCE 2 Manual indicates an order of

precedence - design and appointment of the Project Management Team as the next step -there is no reason why the Project Manager should not immediately commence work on

the Project Approach and the Project Brief. These two documents will have a major

influence on the design of the Project Management Team and identification of the mostappropriate individuals to make the project management actually work.

In practice, the Executive needs to have a close involvement with the production of the

Project Approach and the Project Brief, as these are the two prime documents which will

provide the decision support information for the Project Board Members when they areasked to approve the Initiation Stage of the project.


153

SU2 & SU3 - The Project Management Team

The Project Management Team is the group of people who are responsible for the

planning, management , and control of the project. It might not always be possible to

appoint the whole team at this early stage but as many of the key appointments as possible

should be made.


USED

OUTPUT TO

SU2 –Designing AProjectManagementTeam


Executive & ProjectManagerAppointment (SU1)

Project Management TeamStructure [C]

Appointing A ProjectManagement Team(SU3)

Job Definitions [C] Assembling A PID (SU6)

Authorising Initiation(DP1)

SU3 –Appointing AProjectManagementTeam

ProjectManagement TeamStructure (SU2)


Assembling A PID (SU6)


Figure 64: SU2 & SU3 Plus Inputs and Outputs

Part of the work in this Process will include the definition of Roles and Responsibilities for

each member of the Project Management Team. A start point for these is included at

Appendix C of the PRINCE 2 Manual. It is important to ensure that each member of the

Project Management Team clearly understands the expectations that go with the job, andthe Role Descriptions ensure that this is clearly communicated. Role Descriptions will

apply to all members of the Project Management Team including the senior managers who

are on the Project Board for the project.

Responsibility for establishing the Project Management Team rests jointly with the

Executive and Project Manager, the Executive taking the lead in identifying and

appointing the Project Board Members. When the Project Management Team has been

established it will accompany the other outputs of SU to be endorsed by the newlyestablished Project Board during consideration of the Initiation Stage Plan in DP1. The

source documentation will be used to assemble the Project Initiation Document in IP6


154

SU4 - The Project Brief and Its Relationship To The Project

Mandate

The Project Brief will normally contain the formal Terms of Reference (objectives, scope,

constraints, interfaces etc) for the Project together with an Outline Business Case, basedon the information contained in the Project Mandate


USED

OUTPUT TO

Project Brief [C] Defining ProjectApproach (SU5

Planning An InitiationStage (SU6)

Planning Quality (IP1)

Planning A Project (IP2)

Refining The BusinessCase & Risks)

Assembling A PID (IP6)


SU4 –Preparing AProjectBrief


Risk Log [C] Planning An InitiationStage (SU6)

Planning A Project IP2

Refining The BusinessCase & Risks (IP3)


The Project Brief is based on the Project Mandate which provides the “trigger” for the

project. The Project Mandate may take any form from an informal request by a senior

manager to a formal request to provide a proposal from a customer to a potential supplier.The Project Mandate may therefore be quite thin on information in which case the Project

Brief will take a fair amount of effort to complete. On the other hand, where the Project

Mandate is a comprehensive document emanating from, say, a feasibility or scoping study,

there should be little to add to turn it into a suitable Project Brief.

The Project Brief is used primarily in “DP1 - Authorising Initiation”, by the Project

Board, to decide whether the proposed project merits the time and effort needed to produce


155

a Project Initiation Document. It needs to address the fundamental reasons and constraintsthat support the proposal for the project - it is essentially a “first-cut” Project Initiation

Document.

The Customer’s Acceptance Criteria are contained within the Project Brief and although

the Product Outline for the Project Initiation Document , included in the PRINCE 2Manual , does not specifically mention the Acceptance Criteria within the “Composition”

section, it makes sense to incorporate Acceptance Criteria within the PID as these can then

be used for comparative purposes at each Management Stage review (End StageAssessment), at Project Closure (“Decommissioning A Project (CP1)”) where Customer

Acceptance is obtained, and in “Confirming Project Closure (DP5)” where the project is

formally shut down.


156

SU5 - The Project Approach:

A suitable Approach to the project must be considered, discussed with the Project Board

Executive Member and agreed before seeking authority to prepare a Project Initiation

Document (acceptance of which by the full Project Board will signal the formal start of the

project). Examples of the Approach to the project are:

♦ In-house development/construction;

♦ Out-sourcing to one or more Suppliers;

♦ Joint venture development as a partnership;

♦ Prime Contractor sourcing with multiple sub-contractors;


USED

OUTPUT TO

SU5 –DefiningProjectApproach

Project Brief (SU4)

Risk Log (SU4)

Project Approach [C] Planning An InitiationStage (SU6)






Planning (PL)


After formal endorsement by the Project Board, the Project Approach is included in the

Project Brief (and possibly also the Project Initiation Document). It provides a majorcontribution to planning the project - Initiating A Project (IP2).


157

SU6 - The Initiation Stage Plan

A suitable plan for the Initiation Stage must be produced to enable the Project Board to

authorise the creation of a suitable Project Initiation Document (PID) to authorise the

commencement of the project. Production of the PID might well consume considerable

time, effort and cost and is a key document that will be used to Baseline the project. It

therefore needs to be properly planned, resourced and authorised at a level appropriate tothe investment being proposed.


USED

OUTPUT TO

Draft Initiation Stage Plan [C] Authorising Initiation(DP1)

SU6 –Planning AnInitiationStage

Project Brief (SU4)

Risk Log (SU4)

Project Approach(SU5)

Risk Log [U] Authorising Initiation(DP1)


The Method presumes that the “Starting Up A Project (SU)” Process will be a separate“front-end” to the project and approval of the Initiation Stage Plan will provide

authorisation for the first Management Stage of the project. However, for smaller, low risk,

projects, the first stage might well embrace the “Starting Up A Project (SU)” and

“Initiating A Project (IP)” Processes. Indeed other Processes might also come into playduring the first Stage of the project - these include “Controlling A Stage (CS)”,

“Managing Product Delivery (MP)”, “Managing Stage Boundaries (SB)”. Because of the

involvement in the authorisation processes, the Project Board will also be in play withinthe “Directing A Project (DP)” Process.

The “Planning (PL)” Process, the “Planning A Stage (SB1)” Process, and the Product

Based Planning Technique, are all used in Planning An Initiation Stage. The planning

aspects are straightforward as there is a need only to plan for a short time-scale and for avery simple series of Products and related Activities.


158

Starting Up A Project - Summary

This Process, with the next (“Initiating A Project (IP)”) is critical to the success of any

PRINCE 2 project as it sets the scene, expands the often flimsy Project Mandate, and lays

down the foundation for the organisational structure for the project. It will often be

combined with the IP Process and others, especially where a smaller project is being

addressed. If “Starting Up A Project (SU)” serves to put a brake on the understandableenthusiasm to commence development work before the basics of the project have been

thought through, then it will have served its purpose.


USED

OUTPUT TO

Project Board ExecutiveAppointment [C]

Designing A ProjectManagement Team(SU2)

SU1 –Appointing AProjectBoardExecutive &ProjectManager


Project Manager Appointment [C] Designing A ProjectManagement Team(SU2)

SU2 –Designing AProjectManagementTeam


Executive & ProjectManagerAppointment (SU1)


Appointing A ProjectManagement Team(SU3)

Job Definitions [C] Assembling A PID (SU6)


SU3 –Appointing AProjectManagementTeam



Assembling A PID (SU6)



159

Project Brief [C] Defining ProjectApproach (SU5

Planning An InitiationStage (SU6)



Refining The BusinessCase & Risks)



SU4 –Preparing AProject Brief


Risk Log [C] Planning An InitiationStage (SU6)

Planning A Project IP2


SU5 –DefiningProjectApproach

Project Brief (SU4)

Risk Log (SU4)

Project Approach [C] Planning An InitiationStage (SU6)






Planning (PL)

Draft Initiation Stage Plan [C] Authorising Initiation(DP1)

SU6 –Planning AnInitiationStage

Project Brief (SU4)

Risk Log (SU4)


Risk Log [U] Authorising Initiation(DP1)

Figure 68: Summary of the “Starting Up A Project (SU) Process


161

UNDERSTANDING THE

INITIATING A PROJECT (IP)

PROCESS

Chapter 13


163

Initiating A Project (IP) - Introduction

The “Initiating A Project (IP)” Process is aimed at ensuring that a firm Baseline exists

for the project and that everyone involved understands what the project is seeking to

achieve. In smaller projects, this Process might well be combined with the “Starting Up A

Project (SU)” process but this should be considered carefully. A controlled break between

“Starting Up A Project” and “Initiating A Project” is always required event though bothProcesses may be combined within the same Management Stage.

Figure 69: Initiating A Project (IP) Process

The Project Initiation Document

The major output for this Process is a Project Initiation Document (PID), which will be

used throughout the project to ensure that the work carried out and the

Products/Deliverables being produced are supporting the key objectives and meet thecustomer’s needs. The PID will always need to address the following:

♦ to identify the benefits and risks and to evaluate proposals for managing identified

areas of risk, thus confirming that an acceptable Business Case exists for the project;

Planning

Quality

IP1

Planning a

Project

IP2

Refining the

Business

Case and

RisksIP3

Setting up

ProjectControls

IP4

Setting up

Project Files

IP5

Assembling a

PID

IP6

Authorising a

Project

DP2

Authorising

Initiation

DP1

Authorised

StageInitiation

Plan

Project

Brief

Draft PID

Corporate QMS


164

♦ to provide a foundation for the project from which the Project Initiation Document can

be assembled or prepared.

♦ to provide decision support information to enable the Project Board to confirm theinitial (and ongoing) viability for the project;

♦ to encourage the Project Board to understand and take ownership of the project;

♦ to provide sufficient information for the Project Board to approve the whole project in

principle and to commit resources, formally, for the next Management Stage;

♦ to provide a Baseline for all decision-making for the duration of the project;

♦ to initiate the project in an orderly manner, thus setting “Norms” for the remainder of

the project;

♦ to monitor the progress of the project initiation process against the approved plans.

An Initiation Stage is recommended to be included in any PRINCE 2 managed project;

given that the minimum number of Management Stages within any PRINCE 2 project will

be two, this principle ensures that there will always be at least one “planning” Stage and

one “action” Stage.

The PID is used as a Baseline for the project. It is assembled from Products generated in

the “Starting Up A Project (SU)” Process and the “Initiating A Project (IP)” Process and

when approved by the Project Board it signifies the official start of the project. Theapproved PID will be input to every formal review of the Project (ESAs and MSAs) to

check progress against the agreed baseline. It is also used at Project Closure

(“Decommissioning A Project (CP1)”) to measure the project outcome against the

Acceptance Criteria; successful matching will generate a Customer Acceptance of theoutcome.


165

IP1 - Planning For Quality

Quality plays an important role in any PRINCE 2 project and as such it must be

considered before any major planning activity takes place. The Customer’s Quality

Expectations will have been identified in the “Starting Up A Project (SU)” at the time the

Project Brief was prepared.


USED

OUTPUT TO

IP1 –PlanningQuality

Quality Standards(Programme and/orCorporate QMS)

Project Brief (SU4)


Project Quality Plan [C] Planning A Project (IP2)

Setting Up ProjectControls (IP4)

Setting Up Project Files(IP5)


Figure 70: IP1 Plus Inputs and Outputs

This needs to be built upon and cross-matched with the supplier organisation’s own quality

standards, usually resident in the Quality Management System (QMS).

A correlation between the International Standards Organisation BS/EN/ISO 9001 standard

for quality management and what is offered within the PRINCE 2 Method is provided in

Appendix B of the PRINCE 2 Manual. This Appendix should be used to match thesupplier organisation’s QMS to the requirements of PRINCE 2 and is especially useful

where a QMS is being specified and introduced.

Where an organisation-wide QMS is not already in force, management should considerintroducing a specific Project QMS - having no quality strategy is not an option!

Other aspects that need to be considered are the project staff’s ability to perform effective

Quality Reviews and to understand the significance of the Quality Criteria that will be

included in the Product Description for each Product/Deliverable.


166

IP2 - Planning A Project

Although PRINCE 2 includes a separate Process for “Planning (PL)” and includes

planning as a Component and a specific Technique (Product-Based Planning), the

activities associated with planning for a specific project situation come into operation

within the Process concerned with the specific plan required. For example, planning the

project is an activity which must be undertaken right at the start of the project and liesnaturally within the “Initiating A Project (IP)” Process. Similarly, planning for each

Management Stage is a function of “Managing Stage Boundaries (SB)” as the Project

Manager prepares for the transition from the Current Stage to the Next Stage and preparesdocumentation for the Project Board to reach an informed decision.


USED

OUTPUT TO

Project Plan [C] Refining The BusinessCase & Risks (IP3)




Planning A Stage (SB1)

Risk Log [U] Refining The BusinessCase & Risks (IP3)

IP2 –Planning AProject

Project Brief (SU4)

Risk Log (SU4)


Project Quality Plan(IP1)

Trigger(s) For Next Stage Plan [C] Planning A Stage (SB1)


The Project Manager and the rest of the Project Management Team will use the “Planning

(PL)” Process and the Product Based Planning Technique to prepare the required planswithin the appropriate Processes.

The Process requires a demonstration of an understanding of the project in the long term.

The Project Manager is not expected to be able to predict accurately to the full term of theproject, but must make an intelligent stab at what the future holds and plan for

contingencies.


167

On their part, the Project Board must take a sensible and realistic view of the project,especially where the duration is extended, and view the project plan as a “soft estimate”.

The Management Stage Plan (produced in “Managing Stage Boundaries (SB1)”) provides

the firm, but limited, commitment of resources within the framework of the Project Plan.

This approach ensures that a realistic planning horizon is always in focus (the Stage Plan)within the context of the overall Project Plan.


168

IP3 - Refining The Business Case

The Project Brief will have identified an outline Business Case for the project. This

preliminary assessment will have been approved in principle by the Project Board when

considering the package put forward in support of investing resources into creating a

suitable Project Initiation Document to support the authorisation of the project.

The outline Business Case needs to be enhanced and refined before a final decision to startthe project can be made. The expected Business Benefits will need to be clearly specified

and the risks associated with the project identified.


USED

OUTPUT TO

Risk Log [U] Setting Up ProjectControls (IP4)


Business Case [C] Assembling A PID (IP6)

IP3 –RefiningTheBusinessCase &Risks

Project Brief (SU4)


Project Plan (IP2)

Risk Log (IP2) Project Plan [U] Assembling A PID (IP6)


Where possible, both elements of Business Benefits and Risk will need to be measured inconcert. In the case of the Business Benefits, a Costs:Benefits Analysis/Investment

Appraisal should be considered.

Risks can be measured in many ways; PRINCE 2 does not recommend any particular

approach from the many software-based risk assessment tools that are available but thereneeds to be a balance between creating an effective Risk Assessment, suitable as the basis

for Risk Management, and the time and effort that a comprehensive assessment is bound to

consume. A simple Risk Analysis Checklist has been in use in PRINCE projects for manyyears and an enhanced variant of this has been included at Chapter 7. Use of the Risk

Analysis Checklist is straightforward and an advantage is its visibility - it is well worth a

try and usually provides acceptably accurate results.

The Business Case, when approved by the Project Board will need to be reviewed and up-

dated when preparing for each Management Stage Review (see “Managing Stage

Boundaries (SB)”).


169

IP4 - Setting Up Project Controls

Project controls are the key to the successful management of any project. It is only

possible to control a project to the level of detail in which it has been planned so the

Project (and later, the Stage) plans are critical to the successful management of the project.


USED

OUTPUT TO

Project Plan [U] Assembling A PID (IP6)

Project Controls [C] Assembling A PID (IP6)

Risk Log [U] Assembling A PID (IP6)

IP4 –Setting UpProjectControls


Project Plan (IP2)

Risk Log (IP3)

Communication Plan [C] Assembling A PID (IP6)


This Process is concerned with the identification of the most appropriate level of control

for the project. For large, high-risk projects it may be expected that all the controls listedbelow will be appropriate. For smaller, low-risk projects it will be necessary to consider

both the types of control that are appropriate and their frequency. In principle, however,

all the controls listed below will be appropriate to all projects whatever their size. Themanagement controls that will be identified and used in any PRINCE 2 project fall into

two main categories:

Project Board Controls

♦ Project Initiation Meeting & Project Initiation;

♦ Management Stages - End Stage Assessment;

♦ Exception Reporting & Management - Mid Stage Assessment;

♦ Tolerance – Time & Costs;

♦ Highlight Reporting (from the Project Manager to Project Board Members).

♦ Business Case Re-evaluation (Business Benefits)


170

♦ Risk Analysis (+ Up-date of the Risk Log);

♦ Project Closure.

Project Manager/Team Controls:

♦ Checkpoints;

♦ Quality Reviews (Informal);

♦ Quality Reviews (Formal);

♦ Day-to-Day Communication/Ad-hoc Meetings.

Controls may also be appropriate at the Programme level but this will depend on thenumber, size and relationship of the projects that fall within the aegis of the PRINCE 2

arrangements within a particular implementing organisation.


171

IP5 - Set Up Project Files

All projects will produce documentation which must be stored in an appropriate and

secure way. A fair amount of documentation will already have been produced in the

“Starting Up A Project (SU)” Process and organisations implementing PRINCE 2 project

management systems will wish to consider whether setting up the project filing structure

would best be carried out during the SU Process.


USED

OUTPUT TO

Project Filing Structure [C] Assembling A PID (IP6)

Issue Log [C] Controlling A Stage (CS)

Quality Log [C] Controlling A Stage (CS)

IP5 –Setting UpProjectFiles


Project Plan (IP2)

Lessons Learned Report [C] Controlling A Stage (CS)

Figure 74: IP5 Inputs & Outputs

The documentation which will already be in place following “Starting Up A Project (SU)”

is:

♦ The Project Management Team Organisation Structure;

♦ Roles and Responsibilities for Project Management Team Members;

♦ The Project Brief;

♦ The Project Approach;

♦ The Risk Log;

♦ The Plan for the Initiation Stage;

♦ The Project Board Sign-off Approving the Initiation Stage Plan;

♦ Records of the Project Board Meeting (if appropriate).


172

PRINCE 2 suggests a filing structure but does not require an electronic format, a physicalfile or both. Perhaps the best approach is to have both electronic and physical file

structures sharing a common structure. This will enable Project Managers to maintain

copies of documentation in a format which is permanent, structured and flexible.

All files and their associated documentation, whatever their format, will need to bearchived at the conclusion of the project to allow for appropriate auditing.

Figure 75: PRINCE 2 Suggested Filing Structure


Plans

Business Case

Risk Log

Control Documents

Products Checklist

Files


Plans

Control Documents

Daily Log

Correspondence

Products Checklist


Configuration Log

CI Locations

Off-Specifications


Quality Checks

Project Issues


173

IP6 - Assembling The Project Initiation Document

The key document to be output from the “Initiating A Project (IP)” Process is the Project

Initiation Document. (PID) This document provides a comprehensive view of the project

as it is viewed from the outset of the project.

The PRINCE 2 concept of “assembling” a Project Initiation Document is understandable

but not necessarily realistic as there are always many additional elements that, at the pointthe PID is put together, are not available. To help with this, a Project Initiation Document

Template should be prepared for use in all projects within the implementing organisation.


USED

OUTPUT TO

IP6 –AssemblingA PID


Project Brief (SU4)

ProjectManagement TeamStructure + JobDefinitions (SU3)


Project Plan (IP2)

Business Case(IP3)

Risk Log (IP3)

Project Controls(IP4)

CommunicationPlan (IP4)

Project FilingStructure (IP5)

Draft Project Initiation Document(PID) [C]

Authorising A Project(DP2)



174

Completion of the PID will trigger the need to plan for the next Management Stage of theproject. The work for this activity will be carried out in the Process “Managing Stage

Boundaries (SB)” within the Sub-Process “Planning A Stage (SB1)”.

The PRINCE 2 Method does not recommend that the plan for the next stage be included in

the Project Initiation Document, thereby putting the emphasis on this document beingconcerned with the project itself.

Approach to Assembling or Producing The PID

Assembly of the PID is a very simple task if all the component parts are available and it

can easily be performed by Project Support or the Project Manager. If this is not the case,

the use of the PID Template will make the task much simpler and enable the work to be

shared. In practice, the best approach has been found to be to hold a “PID Workshop”attended by all members of the Project Management Team (including Project Board

members where they can spare the time). Typically one or two days is sufficient, provided

some foundation work has been undertaken. Where this approach is taken, the Project

Initiation Stage Plan should reflect the time and resources needed.


175

Initiating A Project (IP) - Summary

Successful initiation of any project is a key contributor to its eventual outcome. The time,

effort and resources invested in this stage will be well worthwhile, especially if some

unforeseen problem occurs during the project. The Project Board and Project

Management Team will have firm ground on which to base decisions about proposed

changes in direction and investment of resources.


USED

OUTPUT TO

IP1 –PlanningQuality

Quality Standards(Programme and/orCorporate QMS)

Project Brief (SU4)


Project Quality Plan [C] Planning A Project (IP2)




Project Plan [C] Refining The BusinessCase & Risks (IP3)





Risk Log [U] Refining The BusinessCase & Risks (IP3)

IP2 –Planning AProject

Project Brief (SU4)

Risk Log (SU4)



Trigger(s) For Next Stage Plan [C] Planning A Stage (SB1)

Risk Log [U] Setting Up ProjectControls (IP4)


Business Case [C] Assembling A PID (IP6)

IP3 –RefiningTheBusinessCase &Risks

Project Brief (SU4)


Project Plan (IP2)

Risk Log (IP2) Project Plan [U] Assembling A PID (IP6)


176

Project Plan [U] Assembling A PID (IP6)

Project Controls [C] Assembling A PID (IP6)

Risk Log [U] Assembling A PID (IP6)

IP4 –Setting UpProjectControls


Project Plan (IP2)

Risk Log (IP3)

Communication Plan [C] Assembling A PID (IP6)

Project Filing Structure [C] Assembling A PID (IP6)

Issue Log [C] Controlling A Stage (CS)

Quality Log [C] Controlling A Stage (CS)

IP5 –Setting UpProjectFiles


Project Plan (IP2)

Lessons Learned Report [C] Controlling A Stage (CS)

IP6 –AssemblingA PID


Project Brief (SU4)

ProjectManagement TeamStructure + JobDefinitions (SU3)


Project Plan (IP2)

Business Case(IP3)

Risk Log (IP3)

Project Controls(IP4)


Project FilingStructure (IP5)

Draft Project Initiation Document(PID) [C]

Authorising A Project(DP2)

Figure 77: Summary Of The Initiating A Project (IP) Process

Another major, but intangible output from this Process is the understanding that

individuals within the Project management Team (including the Project Board Members)

will gain about the nature, scope and possible pitfalls that the project may have to face.


177

The inclusion of an Initiation Stage in any PRINCE 2 controlled project is not optional -the method is very clear that an Initiation Stage be included whatever the type, scope or

size of the project. The PID itself will be used to provide a baseline for the project

throughout its life and beyond, extending to the completion of a Post-Project Review

sometime after the project is closed down (typically some 6-9 months after the Productfrom the project has been handed over to the customer).

When the PID has been completed and assembled, it is ready to be reviewed by the Project

Board within the “Directing A Project (DP2)“ Process. The vehicle for this is an EndStage Assessment (at the completion of the mandatory Initiation Stage). Acceptance of

the PID and approval by the Project Board signals the formal start of the project.


179

UNDERSTANDING THE

DIRECTING A PROJECT (DP)

PROCESS

Chapter 14


181

Directing A Project (DP) - Introduction

Directing A Project (DP) operates throughout all stages of the project, from the end of

Project Start-up through to Project Closure and is the primary concern of the Project

Board. They achieve this by managing by exception, monitoring through reports provided

primarily by the Project Manager, and controlling through a series of key decision points.

Figure 78: Directing A Project (DP) Process

The key Processes break into the following areas:

♦ Control of the Initiation of the project ensuring it has the best possible start;

♦ Authorisation of the Project, committing the organisation to its successful outcome;

♦ Authorising Continuation of the project where a significant departure from theapproved plans has occurred;

♦ Control of the Stage Boundaries, committing new and additional resources as the

project progresses towards its ultimate aim;

Authorising

Initiation

DP1

Starting up

a Project

SU

Authorising

a Project

DP2

Authorising

a Stage or

Exception

PlanDP3

Giving

Ad hoc

Direction

DP4

Confirming

Project

Closure

DP5

Initiating a

Project

IP

Controlling

a Stage

CS

Managing

Stage

Boundaries

SB

Closing a

Project

CP

Project Brief

Draft Initiation Stage Plan

Job Definitions

Project Management Team

structure

Project Approach

Authorisation

to proceed

Draft

PID

Authorisation

to proceed

Authorisation

to proceed

Highlight Report

Exception Reports

Requests for adviceEnd Project Report

Project Closure

Recommendation

Draft Post Implementation

Review Plan

Follow-on Action

Recommendations


Operational and

maintenance confirmation

PID

Follow-on Action Recommendations


Post Implementation Review Plan

Project Closure Notification

Information from external sourcesProject Start-up

Notification

PID

Exception Plan

End Stage Report

Next Stage Plan

Project Team changes

Updated Project Plan

Updated Business Case

Updated Risk Log

Mobilisation of support

services

Approved PID Exception Report

Request For

Exception Plan


182

♦ Ad-hoc Decision-making and Direction, monitoring progress and providing advice and

guidance as necessary;

♦ When the project has achieved its outcome, or is no longer considered to be a viablebusiness proposition, arranging for Project Closure, bringing the whole undertaking to

a controlled finish.

This Process does not cover the day-to-day activities of managing the project - these rest

with the Project Manager. The Process is positioned at the level of management residingabove the Project Manager.

Information will be presented to the Project Board in a number of ways, from formal

report documents such as the Project Initiation Document (PID) through HighlightReports, usually prepared on a monthly basis, to requests for ad-hoc direction by the

Project Manager where a gentle “touch on the tiller” is required and senior management

support is recommended. The Process is one of the busiest within the Process Model interms of potential and actual inputs and outputs and the physical interpretation of how to

direct a project may be expected to add further reports and directives.

A key requirement within this Process is having senior managers on the Project Board who

have the organisational authority to commit the resources that will be needed to see theproject through to a successful conclusion. The ability to make decisions on commitment

of additional resources in the event of problems and the vision to see the wider picture are

also vital ingredients resident within this Process.

Management By Exception

A guiding principle at this level should always be the ability for senior managers to adopt

a “hands-off” approach and to become involved with the project only at those points in

time when their input is needed and to adopt a Management by Exception approach.

Essentially this approach requires Project Board members to view the project strategicallyand to become involved only at planned review dates and at unscheduled meeting called

only because the project has significantly departed from the approved plan. This is

measured by a control known as “Tolerance” - essentially the scope a Project Manager hasto depart from an approved Stage Plan without needing to report the departure to the

Project Board.

A forecast that the current Stage will not be able to complete within Tolerance (standard

Tolerance of Time and Cost) will result in an Exception Report being prepared by theProject Manager for consideration by the Project Board members. An Exception Plan will

often follow, this being produced by the Project Manager, which will be considered by the

Project Board at a specially convened Mid-Stage Assessment.


183

DP1 – Authorising Initiation

The work carried out in the “Starting Up A Project (SU)” Process is designed to put

together enough information for the Project Board to make a “go/no-go” decision on

whether to invest the necessary resources into the creation of a Project Initiation

Document (PID).

The Project Board will be presented with a set of decision support documentation andasked to approve the project in principle.


USED

OUTPUT TO

Authorisation To Proceed [C]

Stage Plan [U]

Project Brief [U]

Risk Log [R]

Project Management TeamStructure [R]

Project Approach [U]

Initiating A Project (IP)DP1 –AuthorisingInitiation


Job Definitions(SU3)

Project Brief (SU)

Risk Log (SU)


Draft InitiationStage Plan (SU6)

Project Start-up Notification [C] Corporate orProgrammeManagement

Figure 79: DP1 Plus Inputs and Outputs

The project formally starts when this approval is gained (not when the Project InitiationDocument has been prepared and approved).

For low risk, smaller, projects a formal meeting of the Project Board may not be necessary

and approval may be given directly by the Executive member (having responsibility forthe overall business objectives).


184

DP2 – Authorising A Project

Following the creation of the Draft Project Initiation Document (PID) in “Initiating A

Project (IP)” the project can be approved formally by the Project Board and the PID

“frozen”. The point of doing this is to establish a baseline against which to judge the

project as it proceeds towards its conclusion and to measure against the final out-turn

although certain parts of the PID are reviewed and modified at the end of eachManagement Stage; these are the Project Plan, the Business Case and the Risk Log.


USED

OUTPUT TO

Authorisation To Proceed [C] Authorising WorkPackage (CS1)

DP2 –AuthorisingA Project

Draft ProjectInitiation Document(IP6)

Next Stage Plan(SB1)

Approved Project InitiationDocument [U]

Corporate orProgrammeManagement


The above diagram shows how both the Draft Project Initiation Document and the plans

for the next Management Stage are input to this Process as decision support

documentation. Note that the plans for the next Management Stage are not included aspart of the PID but are prepared within a separate Process (“Managing Stage Boundaries

(SB1)”) and accompany the PID as a separate document (the End Stage Report).

Approval of the draft PID and the next Management Stage plans commits the resourcesand triggers commencement of work, providing authorisation for the Project Manager to

begin using the resources in the plans.

A copy of the approved PID is lodged in the Project File and Corporate Management isnotified of the existence of the project by dispatch of a notification, or copy of the PID

whatever is most appropriate.


185

DP3 – Authorising A Stage Or Exception Plan

As it proceeds, the project will be reviewed by the Project Board at the conclusion of each

Management Stage. Essentially the Project Board will be looking for evidence that the

Management Stage has been completed to budget, on time and meeting the requirements

of the Product Descriptions. This will be formally undertaken at an End Stage Assessment

(ESA) and an approval will be sought for the project to continue and the next ManagementStage plans approved and resources committed.


USED

OUTPUT TO

Authorisation To Proceed [C] Controlling A Stage (CS)

Tolerances [C] Controlling A Stage (CS)

Business Case [U] Controlling A Stage (CS)

Project Plan [U] Controlling A Stage (CS)

DP3 –AuthorisingA Stage orExceptionPlan


ProjectManagement TeamChanges (SB5)

Product Checklist(SB5)

Business Case(SB5)

Risk Log (SB5)

End-Stage Report(SB5)

Request forAuthorisation ToProceed (SB5)

Exception Plan(SB6)

Project InitiationDocument (IP6)

Project Tolerances(Corporate orProgrammeManagement)

Progress Information [C] Corporate orProgrammeManagement and otherinterested parties.



186

A number of products and documentation are needed for the Project Board to properlycarry out this responsibility and these are all created and/or updated within the “Managing

Stage Boundaries (SB)” Process. Logs and on-going reports will be retrieved from the

appropriate file and input to the Project Board either before or at the Project Board

meeting. Care should be taken not to swamp the Project Board with too much paper orunimportant information.

Approval of Exception Plans

This Process is used also for approving Exception Plans. An exception occurs when a

significant deviation from an approved plan occurs; a “significant deviation” is measured

by whether Tolerance is exceeded and may occur as a result of a technical or quality

problem within the project or a suggested change to one or more Products.

The procedure is for an Exception Report to be raised by the Project Manager, alerting the

Project Board members of the perceived problem. The Exception Report provides a

statement of the problem, an analysis of its impact, the options available for recovery and

a firm recommendation for recovery.

The Exception Report is considered by the Project Board and a decision taken on whether

the project may continue without any further action, or whether the remainder of the

Management Stage needs to be re-planned to reflect the problem or required change.

If the Project Board decide that the situation is serious enough to warrant it, an Exception

Plan is produced by the Project Manager. The Exception Plan will be considered by the

Project Board at a Mid Stage Assessment and after its approval, substitutes the plan it

replaces.


187

Figure 82: Exception Reporting and Planning

Figure 76 summarises the procedure for notifying the Project Board of a significant

departure from plan (via the Exception Report) and subsequently the creation of the

Exception Plan. Also shown on the above diagram is the Project Board’s option toterminate the project prematurely if they do not wish to continue with the undertaking

following a major change in the approved plans (although this decision might have been

taken earlier, when the exception was first reported and considered in the Process “Giving

Ad-Hoc Direction (DP4)”. Where the cancellation option is preferred, the prematureclosedown of the project will be handled within the “Closing A Project (CP)” Process.

CS8

Escalating

Project IssuesDP4

Giving

Ad-Hoc Advice

1: Exception Report

DP3

Authorising A Stage or

Exception Plan

SB6

Producing An

Exception Plan

2A: Direction

3: Trigger - (Copy of

Exception Report)

4: Exception Plan

CS1 -

Authorising A

Work Package

5: Authorisation

To Proceed

Premature Termination of Project

2B: Request for

Exception Plan

Mid-Stage

Assessment

Problem … Forecast to Exceed Tolerance


188

DP4 – Giving Ad-Hoc Direction

This Process is the most powerful of all the Processes in that it includes provision to

terminate the project prematurely if the Project Board are unhappy about the progress

being made or if a significant departure from the approved plans occurs.

The Process is also concerned with giving advice to the Project Manager and other staff

employed on the project as and when it is needed and requested.


USED

OUTPUT TO

Exception Plan Request [C] Producing An ExceptionPlan (SB6)

Premature Close [C] De-Commissioning AProject (CP1)

Response to External Sources(Corporate & ProgrammeManagement)

Corporate & ProgrammeManagement

DP4 –Giving Ad-HocDirection

Information from &to External Sources(Corporate orProgrammeManagement)

Highlight Reports(CS6)

Requests forAdvice (CS7)

Exception Report(CS8)


Response to Requests for Advice Project Manager


Highlight Reports, prepared by the Project Manager (usually monthly, but at the frequency

required by the Project Board) will provide much of the everyday input for the Project

Board’s advice, comments and direction. Information coming into the project fromexternal sources will also be filtered by the Project Board and acted upon, usually by

providing direction to the Project Manager.


189

DP5 – Confirming Project Closure

The responsibilities of this sub-process will usually (but not necessarily) be exercised

through the holding of a Project Closure Meeting where the project will be shut down in

an orderly and structured way.

The information needed for the Project Board to shut down the project will be produced in

“Closing A Project (CP)” Process and will include Customer Sign-off and identificationof any follow up actions.

The approval of a plan for performing a Post-Project Review (usually some 9-12 months

after the closedown of the project will also be considered during this final Process.

A fuller summary of the inputs and outputs to DP5 is shown in the following diagram:

Project Closure Notification [U](Approved)


Follow0on ActionRecommendations [U] (Approved)


Post-Project Review Plan [U](Approved)


DP5 –ConfirmingProjectClosure

Operational &MaintenanceAcceptance (CP1)

CustomerAcceptance (CP1)

Project ClosureRecommendation(CP1)

Post-ProjectReview Plan (CP2)

Follow-on ActionRecommendations(CP2)

Lessons LearnedReport (CP3)

End Project Report(CP3)

Baselined ProjectInitiation Document(DP2)

Lessons Learned Report [U](Approved)




190

Specifically, the Project Board will wish to satisfy themselves that the project has a clearlydefined end and that an orderly hand-over to operational use has been effected. The

Project Board will look to the Senior User for confirmation that an acceptable End-Product

is in existence and that it can be supported in an operational environment.

A close liaison with the Project Board members will need to be maintained throughout theProject Manager’s preparation for this very important Process, ensuring that there are no

surprises awaiting the members at the closure meeting.


191

Summary of the DP Process

It is within the “Directing A Project (DP)” Process that every authorisation takes place.

The Process is extremely important to the successful outcome of the project.


USED

OUTPUT TO

Authorisation To Proceed [C]

Stage Plan [U]

Project Brief [U]

Risk Log [R]

Project Management TeamStructure [R]

Project Approach [U]

Initiating A Project (IP)DP1 –AuthorisingInitiation


Job Definitions(SU3)

Project Brief (SU)

Risk Log (SU)


Draft InitiationStage Plan (SU6)

Project Start-up Notification [C] Corporate orProgrammeManagement

Authorisation To Proceed [C] Authorising WorkPackage (CS1)

DP2 –AuthorisingA Project

Draft ProjectInitiation Document(IP6)


Approved Project InitiationDocument [U]



192

Authorisation To Proceed [C] Controlling A Stage (CS)

Tolerances [C] Controlling A Stage (CS)

Business Case [U] Controlling A Stage (CS)

Project Plan [U] Controlling A Stage (CS)

DP3 –AuthorisingA Stage orExceptionPlan


ProjectManagement TeamChanges (SB5)

Product Checklist(SB5)

Business Case(SB5)

Risk Log (SB5)

End-Stage Report(SB5)

Request forAuthorisation ToProceed (SB5)

Exception Plan(SB6)


Project Tolerances(Corporate orProgrammeManagement)

Progress Information [C] Corporate orProgrammeManagement and otherinterested parties.

Exception Plan Request [C] Producing An ExceptionPlan (SB6)

Premature Close [C] De-Commissioning AProject (CP1)

Response to External Sources(Corporate & ProgrammeManagement)

Corporate & ProgrammeManagement

DP4 –Giving Ad-HocDirection

Information from &to External Sources(Corporate orProgrammeManagement)

Highlight Reports(CS6)

Requests forAdvice (CS7)



Response to Requests for Advice Project Manager


193

Project Closure Notification [U](Approved)


Follow0on ActionRecommendations [U] (Approved)


Post-Project Review Plan [U](Approved)


DP5 –ConfirmingProjectClosure

Operational &MaintenanceAcceptance (CP1)

CustomerAcceptance (CP1)

Project ClosureRecommendation(CP1)

Post-ProjectReview Plan (CP2)

Follow-on ActionRecommendations(CP2)

Lessons LearnedReport (CP3)

End Project Report(CP3)

Baselined ProjectInitiation Document(DP2)

Lessons Learned Report [U](Approved)


Figure 85: Summary of the Directing A Project (DP) Process


195

UNDERSTANDING THE

CONTROLLING A STAGE

PROCESS

Chapter 15


197

Controlling A Stage (CS) - Introduction

Following the Project Board’s decision to approve a Stage, the Project Management Team

must be fully focused on delivery of the Products, to their stated Quality Criteria, within

the approved time-scales and budget, within the stated Tolerances.

Figure 86: Controlling A Stage (CS) Process

This Process forms the main part of the Project Manager’s effort on the management of the

project, and provides the direction for the day-to-day management of the Stage and the

overall project. All through the Stage there will be an on-going cycle of:

♦ authorising Packages of Work that must be completed during the Management Stage

and receiving Completed Work Packages (or Products) back into the hostorganisation;

♦ gathering Progress Information about the work carried out and the resources and

effort expended;

Closing a

Project

CP

TakingCorrective

Action

EscalatingProject Issues

CS8

AuthorisingWork Package

AssessingProgress

Receiving

CompletedWork

PackageCS1CS7 CS2 CS9

Reviewing

Stage Status

CS5

Reporting

Highlights

CS6

ExaminingProject Issues

CS4

Capturing

Project Issues

CS3

Directing aProject

DP

Managing

StageBoundaries

SB

ManagingProductDelivery

MP

Project End

Notification

Work Package

Checkpoint Report

Quality Log

Completed

Work Package

Exception Report

Issue Log

Highlight

Report

Stage Plan

Risk Log

Business Case

New Project

Issues

Authorisation to

proceed

Stage/Exception

Plan

Copy of Exception Report


198

♦ watching for Changes to the approved plan; managing any changes raised formally

against the project (Project Issues) and making decisions on the introduction ofbeneficial changes provided these do not result in the Stage Plans exceeding the

Tolerance;

♦ reviewing situations for Stage and Project Impact;

♦ reporting to the Project Board and to other members of the Project Management

Team;

♦ approving and initiating any Corrective Action.

It may be expected that for much of the time events during a Management Stage will

follow a regular and predictable pattern. However, personal qualities and project

management abilities need to combine to address situations which are not going accordingto plan and it is then that the Project Manager must use knowledge, political and people

skills to bring things back on course.


199

CS1 – Authorising A Work Package

Work is released to Team Managers or directly to staff working on the project via the

issue of authorised Work Packages. The format for these might be a formal contract,

where the Products are being produced by a Supplier external to the host organisation, or

much less formal (for example by internal memorandum or discussion) where the provider

is employed within the host organisation.


USED

OUTPUT TO

Plan Adjustments [C] Assessing Progress(CS2)

CS1 –AuthorisingWorkPackage

Stage or ExceptionPlan (DP3)

Authorisation ToProceed (DP3)

Proposed WorkPackage (CS5)

Work Trigger (CS7

ProductDescriptions (PL2)

Work Package [C] Accepting A WorkPackage (MP1)

Figure 87: CS1 Plus Inputs and Outputs

The Project Manager is responsible for the preparation, release and agreement of Work

Packages; authority for this responsibility stems from the Project Board’s approval of the

relevant Management Stage Plan and for this reason Management Stage Plans (producedin the “Managing Stage Boundaries (SB)” Process) must be sufficiently detailed for the

Project Board to understand to what they are committing.

Changes necessary as the Management Stage progresses must be reflected in the workbeing carried out on the relevant Work Packages – this demands a close association

between the Project Manager and the Team Manager(s) responsible for producing the

Product(s). Where a formal contract is in existence, care must be taken not to upset thecontract arrangements by demands for trivial changes.

This Process provides the Project Manager with the main vehicle for release of work and

is a major control on a day to day basis.


200

CS2 – Assessing Progress

The Project Manager must keep track on how well the Management Stage, and the

Project, is performing against the plan approved by the Project Board at the last End Stage

Assessment. This Process provides the mechanics for capturing “Actuals” and passing

the information forward to “Reviewing Stage Status (CS5)” where the Project Manager can

take stock of progress so far.


USED

OUTPUT TO

CS2 –AssessingProgress

Checkpoint Reports(MP2)

Quality Log (MP2)

Plan Adjustments(CS1)

Stage Plan (CS5)

Work PackageStatus (CS9)

Up-dated Stage Plan [U] Examining ProjectIssues (CS4)

Reviewing Stage Status(CS5)


The information needed to update the approved Management Stage Plan comes from three

major sources:

♦ Checkpoint Reports (created within the “Managing Product Delivery (MP2)”

Process);

♦ Timesheets (where these are in use within the host organisation – otherwise an

assessment by the Project Manager of effort expended and financial liability incurred);

♦ Project Issues – especially where errors or departures from the agreed requirementhave been identified.

This Process is best carried out by Project Support, where appointed, with a presentation

of the plans, updated to show “actuals”, to the Project Manager for overall assessment onat least a weekly basis.

Use of a suitable software planning tool (such as MS Project, Project Manager

Workbench, Primavera etc) will simplify this Process especially if standard “actuals”


201

reporting forms generated within the package are fully utilised.

The output from CS2 goes towards the Project Manager’s review of how well the

Management Stage is progressing when measured against the Management Stage plan

approved by the Project Board at the previous End Stage Assessment.


202

CS3 - Capturing Project Issues

As the project progresses there will be a need to capture and decide upon changes that

occur. All changes within a PRINCE 2 project are treated as types of Project Issue. These

include errors found in signed-off Products, departures from the agreed Specification,

ideas and suggestions people have for improving the project’s outputs, resource changesthat need to be reflected in the project and stage plans.


USED

OUTPUT TO

CS3 –CapturingProjectIssues

Issue Log (QualityFile)

New Project Issues(Any ProjectSource)

Up-dated Issue Log [U] Examining ProjectIssues (CS4))


A Project issue can be raised by anyone associated with the project. Typically

organisations will have their own existing change control arrangements and these should

be adopted where they are performing satisfactorily.

The first job on receipt of a Project Issue is to record it on the Issue Log - this will

normally be a function of Project Support or the Configuration Librarian where appointed.The Issue can then be passed to “CS4 - Examining Project Issues”.

The types of Project Issue are:

♦ Request For Change - causing a change to the Customer’s Specification or AcceptanceCriteria; usually paid for by the Customer.

♦ Off-Specification causing errors or omissions in work already completed or planned;

usually paid for by the Supplier.

♦ Other Changes such as modification to the Project Management Team.

More information can be found in the Chapter on Understanding The Change Control

Component and Technique.


203

CS4 - Examining Project Issues

This Process enables each Project Issue to be examined and its impact assessed; this

should be carried out as soon as possible after receipt and logging of the Project Issue.


USED

OUTPUT TO

Issue Log [U] Reviewing Stage Status(CS5)

Risk Log [U] Reviewing Stage Status(CS5)

CS4 –EvaluatingProjectIssues

Business Case(SB3)

Stage Plan (CS2)

Issue Log (CS3)

Risk Log (SB4)

Project Plan (SB2)

Issue Log [U] Reporting Highlights(CS6)


The examination and evaluation of Project Issues may take place via a regular meeting or

by circulation of the Issue and comments to those involved. Whatever route is chosen,

progress needs to be recorded in the Issues Log.

Project Issues should always be examined from a Customer, Supplier and Business

perspective; any action needed which would take the Management Stage over the agreed

Tolerance must be referred to the Project Board in the form of an Exception Report (see“Escalating Project Issues (CS8))”.

Responsibility for examining Project Issues rests with the Project Manager who will use

the support services of Team Managers in helping arrive at an appropriate decision. TheSenior User member of the Project Board will prioritise and if necessary canvas the

Project Board for any additional resources needed to clear outstanding Project Issues.

Prioritisation of outstanding Project issues is usually done by referring to the Issues Log at

each End Stage Assessment.


204

CS5 - Reviewing Stage Status

This Process provides for a regular check of how the Management Stage is performing

against its approved plan. The intention is to allow the Project Manager to stand back

from the day to day problem solving activities and take stock, prior to reporting the

situation to the Project Board.


USED

OUTPUT TO

Notification of Project End [C] De-Commissioning AProject (CP1)

Work Trigger(s) [C] Authorising WorkPackage (CS1)

Stage Status Information [C] Reporting Highlights(CS6)

Plan Deviation [C] Taking Corrective Action(CS7)

Stage Plan [U] Escalating ProjectIssues (CS8)


Project Issue [R] Escalating Projectissues (CS8)

CS5 –ReviewingStageStatus

Stage Plan (CS2)

Issue Log (CS4)

Risk Log (CS4)

Tolerances (DP3)

Business Case(DP3)

Project Plan (DP3)

Stage End Notification [C] Planning A Stage (SB1)


The key driver for assessing Management Stage status is the “Assessing Progress (CS2)”

Process which captures information from Checkpoint Reports and Timesheets and updatesthe approved plans with “actuals”. Inputs will also be needed from the Issues Log where

modifications to the Management Stage plans may be brewing following the discovery of

errors and omissions or ideas for improvement., and the Risk Log which will enable theProject Manager to review emerging risks identified at the outset of the Management

Stage.

The overall outcome of the Process is to ensure on a regular basis (recommended weeklyat the minimum) that the Management Stage remains within Tolerance and that nothing

untoward is likely to occur without warning.

Information and knowledge gleaned from this Process will feed the creation of the

Highlight Report for the Project Board.


205

CS6 - Reporting Highlights

Having approved a Management Stage Plan, the Project Board will need to be kept

informed of the progress being made towards the successful conclusion of the stage.

Reporting Highlights to the Project Board will be a regular, time-related activity, typically

every month but specifically at the frequency required by the Project Board.


USED

OUTPUT TO

Highlight Reports [C] Giving Ad-Hoc Direction(DP4)

CS6 –ReportingHighlights

CommunicationPlan (ProjectFile/PID)

Stage Plan (CS5)

Checkpoint Reports(CS5)

Issue Log (CS5)

Risk Log (CS5)

Tolerances (CS5)

Plan Revisions(CS5)

Communications To InterestedParties [C]



The objective of the Highlight Report is to provide summary information to the Project

Board - one sheet of paper (or its equivalent) is all that is needed. The steps taken in

performing this Process are:

Assemble information from Checkpoint Reports and Project Issues received during the

previous period since the last Highlight Report

♦ Identify any new or potential problem arising from “Reviewing Stage Status (CS5)”

♦ Identify any significant revisions to the approved plan from “Taking Corrective Action

(CS7)”

♦ Create the Highlight Report (Project Support might well produce the first draft)


206

♦ Distribute the Highlight Report to Project Board members and any other agreed

recipients.

The Highlight Report does not normally require a meeting of the Project Board although

this is an option for high-profile, high-risk projects where the Project Board are

particularly sensitive about the progress that is being made.


207

CS7 - Taking Corrective Action

In even the best managed projects, departures from the planned course of action will occur

and remedial action must be taken to bring the work back into line. This Process enables

the Project Manager to make small adjustments, within the agreed Tolerance, to the work

being carried out.


USED

OUTPUT TO

Work Trigger [C] Authorising WorkPackage (CS1)

Up-dated Stage Plan [U] Reporting Highlights(CS6)

CS7 –TakingCorrectiveAction

Stage Plan (CS5)

Issue Log (CS5)

Plan Deviation(CS5)

Risk Log (CS5)Request For Advice [C] Giving Ad-Hoc Direction

(DP4)


The main driver for the Process comes from “CS5 - Reviewing Stage Status” where

deviations from the required and planned outcome will start to become apparent. Projects

seldom change course dramatically but rather significant slippage is prompted by many

smaller incidents and this Process aims to treat each incident as it occurs. Additional WorkPackages may be identified in this Process.

Advice and guidance may well need to be sought from Project Board members and this

will usually be informal. The results of this Process will need to be considered forreporting to the Project Board by inclusion on the next Highlight Report but this should be

the exception rather than the rule.

The Project Manager is responsible for the operation of this Process helped by the ProjectManagement Team. Project Managers should always be aware of the build-up of

apparently minor problems being symptomatic of bigger trouble with the project.


208

CS8 - Escalating Project Issues

As soon as it is forecast that a Management Stage (or the Project) is likely to go outside

the Tolerance the Project Manager must notify the Project Board by raising an Exception

Report.


USED

OUTPUT TO

Exception Report [C] (+ Responseback from Project Board)

Giving Ad-Hoc Direction(DP4)

Producing An ExceptionPlan (SB6)

Project Board Response [R] Producing An ExceptionPlan (SB6)

CS8 –EscalatingProjectIssues

Business Case(CS5)

Issue Log (CS5)

Project Plan (CS5)

Stage Plan (CS5)

Risk Log (CS5)


Stage Plan [R] Producing An ExceptionPlan (SB6)


Although many things may contribute to or trigger this Process the most common situation

is where a Project Issue has been raised to record an error or deficiency with one or moreProducts. The steps to be taken in this Process are:

♦ Identify the problem and carry out an Impact Analysis

♦ Identify and Evaluate options for recovery

♦ Select a recommended direction

♦ Document the problem, reasons, impact, options and recommendations in an Exception

Report for the Project Board

♦ Await the Project Board’s response

The expected outcome will be a request to produce an Exception Plan which will replace

the plan that has gone into exception. The Project Board’s views and advice shouldalways be sought before producing an Exception Plan and the effect on the overall Project

Plan (including the Business Case and Risks) must always be evaluated.


209

CS9 - Receiving A Completed Work Package

This Process records the successful completion of a Work Package (or Product) and

delivery of it back into the host organisation. It is closely associated with “Authorising A

Work Package (CS1)” discussed earlier.


USED

OUTPUT TO

CS9 –ReceivingCompletedWorkPackage

Approved WorkPackage (MP3)

Work Package Status [C] Assessing Progress(CS2)


The arrangements for delivering the Completed Work Package will have been agreedwhen the Work Package was accepted by the Supplier, Team Manager or person

responsible for its production in the Process “Accepting A Work Package (MP1)”.

Completed Work Packages or Products delivered into the host organisation will all havebeen Quality Reviewed (in Process “Executing A Work Package (MP2)”) in accordance

with the requirements agreed when the Work Package was accepted.

The results of the Process are used to assess the progress made by recording the task as

complete and updating the Management Stage and project records accordingly.


210

Summary of the Controlling A Stage Process

Controlling A Stage (CS) is the main project management driver for a PRINCE 2

controlled project. The Process is owned by the Project Manager and is where most of the

“day-to-day” project management activities are carried out.


USED

OUTPUT TO

Plan Adjustments [C] Assessing Progress(CS2)

CS1 –AuthorisingWorkPackage

Stage or ExceptionPlan (DP3)

Authorisation ToProceed (DP3)

Proposed WorkPackage (CS5)

Work Trigger (CS7

ProductDescriptions (PL2)

Work Package [C] Accepting A WorkPackage (MP1)

CS2 –AssessingProgress

Checkpoint Reports(MP2)

Quality Log (MP2)

Plan Adjustments(CS1)

Stage Plan (CS5)

Work PackageStatus (CS9)

Up-dated Stage Plan [U] Examining ProjectIssues (CS4)

Reviewing Stage Status(CS5)

CS3 –CapturingProjectIssues

Issue Log (QualityFile)

New Project Issues(Any ProjectSource)

Up-dated Issue Log [U] Examining ProjectIssues (CS4))


211

Issue Log [U] Reviewing Stage Status(CS5)

Risk Log [U] Reviewing Stage Status(CS5)

CS4 –EvaluatingProjectIssues

Business Case(SB3)

Stage Plan (CS2)

Issue Log (CS3)

Risk Log (SB4)

Project Plan (SB2)

Issue Log [U] Reporting Highlights(CS6)

Notification of Project End [C] De-Commissioning AProject (CP1)

Work Trigger(s) [C] Authorising WorkPackage (CS1)

Stage Status Information [C] Reporting Highlights(CS6)

Plan Deviation [C] Taking Corrective Action(CS7)

Stage Plan [U] Escalating ProjectIssues (CS8)


Project Issue [R] Escalating Projectissues (CS8)

CS5 –ReviewingStageStatus

Stage Plan (CS2)

Issue Log (CS4)

Risk Log (CS4)

Tolerances (DP3)

Business Case(DP3)

Project Plan (DP3)

Stage End Notification [C] Planning A Stage (SB1)

Highlight Reports [C] Giving Ad-Hoc Direction(DP4)

CS6 –ReportingHighlights

CommunicationPlan (ProjectFile/PID)

Stage Plan (CS5)

Checkpoint Reports(CS5)

Issue Log (CS5)

Risk Log (CS5)

Tolerances (CS5)

Plan Revisions(CS5)

Communications To InterestedParties [C]



212

Work Trigger [C] Authorising WorkPackage (CS1)

Up-dated Stage Plan [U] Reporting Highlights(CS6)

CS7 –TakingCorrectiveAction

Stage Plan (CS5)

Issue Log (CS5)

Plan Deviation(CS5)

Risk Log (CS5)Request For Advice [C] Giving Ad-Hoc Direction

(DP4)

Exception Report [C] (+ Responseback from Project Board)

Giving Ad-Hoc Direction(DP4)

Producing An ExceptionPlan (SB6)

Project Board Response [R] Producing An ExceptionPlan (SB6)

CS8 –EscalatingProjectIssues

Business Case(CS5)

Issue Log (CS5)

Project Plan (CS5)

Stage Plan (CS5)

Risk Log (CS5)


Stage Plan [R] Producing An ExceptionPlan (SB6)

CS9 –ReceivingCompletedWorkPackage

Approved WorkPackage (MP3)

Work Package Status [C] Assessing Progress(CS2)

Figure 96: Summary of the Controlling A Stage (CS) Process


213

UNDERSTANDING THE

MANAGING PRODUCT DELIVERY

PROCESS

Chapter 16


215

Managing Product Delivery (MP) - Introduction

This major Process is aimed primarily at managing the interface between the Customer

Project Manager and the Supplier Project Manager ensuring that work is actually

progressing in accordance with the customer’s expectations and that all the planned

Products are created and delivered within the agreed time-scales and contract price or

internally approved budget, and meet their approved Quality Criteria. The Process is alsoused for managing the delivery of Products where an external Supplier is not involved in

the project and where all resources managed by the project are internal; it is also

appropriate where there is a mixture of both.

Figure 97: Managing Product Delivery (MP) Process

The Process comprises:

♦ making certain that work on Products allocated to each external Team or TeamMember resource is properly Authorised;

♦ ensuring that Packages of Work are identified, discussed, agreed, authorised and

accepted by those responsible for the creation of Products;

♦ checking that all Interfaces between the Customer and Supplier organisations are

identified, recorded, observed and handled in an appropriate way;

Assessing

Progress

CS2

Checkpoint Report

Quality Log

Stage Plan

Work Package

Closure

Product Sign-off

Accepting a

Work Package

MP1

Executing a

Work Package

MP2

Delivering a

Work Package

MP3

Receiving

Completed

Work

PackageCS9

Authorising

Work Package

CS1

Work Package

Stage Plan


216

♦ ensuring that all the Work is actually Carried Out, as agreed;

♦ ensuring that the Progress of Work and Forecasts of the time and effort to completion

are regularly assessed;

♦ checking that all finished Products conform to their agreed Quality Criteria;

♦ obtaining Approval for completed Products. This will usually be at three levels –Producer and Reviewer level, Project Manager level, and ultimately endorsement by

the Project Board at the end of each Project Stage. These levels of approval will be

reflected in both the Customer and Specialist Supplier organisations, although it is notnecessary that either will be working within a PRINCE environment; it is essential,

however, that all involved are working within a suitably controlled project management

environment.

This Process will operate continuously throughout each Stage; it provides a healthy

separation between the Customer Project Manager and the Supplier Project Manager and

requires the interface between the Supplier(s) (be they internal or external) and theCustomer to be identified, defined and operated. Care must be taken to ensure that the

interfaces are neither missed nor lost, and that bureaucracy is kept to the absolute

minimum consistent with effective control.

Where a Project Manager allocates work directly to individuals responsible for carryingout the work package, this Process will be informal but will always exist.


217

MP1 - Accepting A Work Package

The Process provides for the establishment of agreement between the Project Manager

and the Team Manager, Team or individual who will be responsible for creating and

delivering the completed Work package (or Product) for the host organisation.


USED

OUTPUT TO

Risk Log [U] Up-Dating The Risk Log(SB4)

Work Package (Authorised) [C] Executing A WorkPackage (MP2)

MP1 –Accepting AWorkPackage

Work Package(CS1)

Team Plan [C] Executing A WorkPackage (MP2)

Figure 98: MP1 Plus Inputs and Outputs

The interface between the Project Manager and those responsible for creating the Products

of the project needs to be properly managed. This Process enables the agreement to beestablished before any work is commenced. The agreement/interface manifests itself in

the form of a Work Package authorisation of which the key elements are:

♦ Agreement of the Objectives for the Work Package

♦ Tolerances for the Work Package

♦ The Reporting Arrangements - Timing and Content

♦ A Plan for the Work Package

♦ A Product Description specifying the Product’s content, its Quality Criteria and the

Method of measuring if the Product conforms to its stated Quality Criteria.

The Project Manager is responsible for delivering the Products to the Project Board as part

of the Management Stage objectives; responsibility for agreement of the Work Package

resides with the Project Manager and the Team Manager, where appointed (and the ProjectManager where no Team Manager exists).


218

MP2 - Executing A Work Package

This Process addresses the creation of the Products of the project. It may be that the

creators of the Products are not using PRINCE or any other formal project management

method and where this is the case agreement of the Work Package in MP1 is even more

significant.


USED

OUTPUT TO

Quality Log [U] Assessing Progress(CS2)

Checkpoint Reports [C] Assessing Progress(CS2)

Completed Work Package [C] Delivering A WorkPackage (MP3)

MP2 –Executing AWorkPackage

Work Package(Authorised) (MP1)

Team Plan (MP1)

Team Plan [U] Stage File


It is within this Process that “actuals” are captured, at source, to enable the effort and costs

in the Management Stage Plan and the Project Plan to be updated within the “ControllingA Stage - Assessing Progress (CS2)” Process.

The quality checking arrangements agreed within MP1 will be performed during this

Process; the objective is to ensure that quality is integral to the Product(s) being built so

that Products delivered back into the host organisation are complete and ready to be placedinto the Configuration Management System as finalised Products. Indeed it might well be

that the Configuration Librarian may be the first recipient of completed Work Packages or

Products to log and file them before reporting the situation to the Project Manager.

Checkpoint Reports are generated within MP2 at the frequency and in the format agreed in

the Work Package. Checkpoint Reports are used within CS2 to update the Management

Stage and Project Plans.

Responsibility for all activities within this Process is vested in the Team Manager where

appointed, or the Project manager where no such appointment has been made.


219

MP3 - Delivering A Work Package

Formalising the return of a completed Work Package is the focus for this Process.


USED

OUTPUT TO

MP3 –Delivering AWorkPackage

Completed WorkPackage (MP2)

Approved Work Package [C] Receiving CompletedWork Package (CS9)


A simple but significant Process, MP3 provides for final sign-off of the Product(s),

dispatch and hand-over of the Product(s) and formal notification to the Project manager of

the completion of work by the Team Manager or person responsible.

The arrangements for hand-over and notification should have been established in MP1 and

will often be embodied into a formal contract document.

Responsibility lies with the Team Manager where appointed.


220

Summary of the Managing Product Delivery Process

Managing Product Delivery is the “engine room” for the PRINCE 2 project, creating the

Products required for Management Stage; it is where the bulk of the project’s time, effort

and financial resources will be spent. The Process will always be present in some form

although it will be less formal where no outside Supplier or sub-contractor is being used.

External suppliers may not be using the PRINCE 2 Method for their project managementstandard and this Process may not, therefore be physically implemented or understood

where this is the case.


USED

OUTPUT TO

Risk Log [U] Up-Dating The Risk Log(SB4)

Work Package (Authorised) [C] Executing A WorkPackage (MP2)

MP1 –Accepting AWorkPackage

Work Package(CS1)

Team Plan [C] Executing A WorkPackage (MP2)

Quality Log [U] Assessing Progress(CS2)

Checkpoint Reports [C] Assessing Progress(CS2)

Completed Work Package [C] Delivering A WorkPackage (MP3)

MP2 –Executing AWorkPackage

Work Package(Authorised) (MP1)

Team Plan (MP1)

Team Plan [U] Stage File

MP3 –Delivering AWorkPackage

Completed WorkPackage (MP2)

Approved Work Package [C] Receiving CompletedWork Package (CS9)

Figure 101: Summary of the “Managing Product Delivery (MP)” Process


221

UNDERSTANDING THE

MANAGING STAGE BOUNDARIES

PROCESS

Chapter 17


223

Managing Stage Boundaries (SB) - Introduction

To achieve a successful outcome to the project, it is necessary to break it into smaller,

discrete packages to enable the Project Team to focus on specific Products or Deliverables;

this approach provides the concept of Project Stages. By controlling the start and finish of

each stage, specific attention can be given to whether the Stage Products/Deliverables

have all been completed in accordance with their Quality Criteria, whether the remainingproject Products/Deliverables are still required, and whether the Business Case for the

project remains viable.

Figure 102: Managing Stage Boundaries (SB) Process

The aims of the Process are:

♦ to assure the Project Board that all the Products/Deliverables planned for the currentstage have been completed and meet their Quality Criteria;

♦ to provide the information on time-scale, technical achievement, and the budget needed

to enable the Project Board to assess whether the overall project Business Case is still

viable, and whether the Benefits can be achieved within an acceptable level of risk;

ReportingStage End

SB5

Updating aProject Plan

SB2SB1

Updating aProjectBusinessCase SB3

Updating the

Risk Log

Producing An

Exception

PlanSB4

Authorising aStage orException

PlanDP3

Project Plan, Business Case,Project Brief

Issue Log

Risk Log

Business Case

Request for Authorisation to proceed

Next Stage Plan

End Stage ReportLessons Learned Report

Risk, Issue andQuality Logs

Current Stage Plan

Current PM Team

Risk & Issue Log

Project Plan

Updated PM team

Request ForException Plan

+ Exception Report

Agreed Tolerance

CurrentStagePlan

Issueand RiskLog

Project Approach

ProjectQualityPlan

PlansIssueand RiskLogs

Plans Plans

Closing aProject

CP

Project Brief

Planning A

Stage

SB6


224

♦ to provide decision-support information on the status of the current stage and the

overall project, which will enable the Project Board to reach a decision on finalcompletion of the current stage, authorise the start of the next stage, and to endorse the

overall project.

♦ to provide a vehicle for stating the Tolerance which may be allowed for the next Stage.

Tolerance is a control providing cost and time “trigger-figures” beyond which the

Project Manager may not progress without the approval of the Project Board.

♦ to record any information or Lessons Learned which might impact on later stages ofthe project, or on the organisation as a whole.

The Process is an iterative one as the project proceeds from one stage to the next.

Controlling the start and end of stages is a key control process for the Project Board andincorporates all the key aspects of directing a project.

Exception Plans

The steps of this Process may also be used when creating an Exception Plan, where a

significant departure from the approved plan has occurred and Tolerance is forecast to beexceeded. In order to reach a decision on the future of the project, the Project Board will

need to consider an impact analysis, options appraisal, and a recommendation for action

prepared by the Project Manager; these will all need to be supported by an up-datedBusiness Case confirming the benefits and re-appraisal of the risks.


225

SB1 - Planning A Stage

As the project progresses the Project Board will limit their commitment and risk exposure

by releasing the commitment of effort and funding via End Stage Assessments at the

completion of each Management Stage. A key input to these major Project Board controls

is the plan for the next Management Stage put together in SB1.


USED

OUTPUT TO

Next Stage Plan [C] Up-Dating A ProjectPlan (SB2)

Project Plan [R] Up-Dating A ProjectPlan (SB2)

Project Management TeamChanges [U]

Reporting Stage End(SB5)

SB1 –Planning AStage

Current Stage Plan(CS5) (Stage File)

Stage EndNotification (CS5)

Project Plan (IP2)(Project File)

Trigger For NextStage Plan (IP2)

PID (IP6) (ProjectFile)

Current ProjectManagement Team(IP6) (Project File &Stage File)

Product Checklist [U] Reporting Stage End(SB5)

Figure 103: SB1 Plus Inputs and Outputs

The aim of the Process is to identify all the Products (Specialist, Management and Quality)

that will need to be produced during the next Management Stage and estimate the effortand cost to its completion. A number of inputs will be necessary to achieve this end

(including the agreed Project Plan) to accurately position the Management Stage, and they

are summarised in the above diagram.

The Organisation Structure for the Project Management Team will also be reviewedduring this Process, to ensure that the most appropriate resources and management team

are available for the work to be undertaken.

Much of the work involved in creating the Next Stage Plan will be carried out by membersof the Project Management Team under the supervision of the Project Manager, who has

prime responsibility for the timely production of the plan.

Any individuals having responsibility for Project Assurance will need to be consulted

during this Process especially in respect of the proposed management controls and qualitycontrol structure.


226

SB2 - Updating A Project Plan

Information needed for decision support at the end of each Management Stage obviously

includes an updated view of the Project Plan to identify what impact work so far on the

project has impacted on the final delivery date and cost.


USED

OUTPUT TO

Up-Dated Project Plan [U] Up-Dating A ProjectBusiness Case (SB3)


Up-Dating The Risk Log(SB4)

SB2 – Up-Dating AProject Plan

Current & NextStage Plans (SB1)

Exception Plan(SB6)

Project Approach(IP6) (Project File)

Project Quality Plan(IP6) (Project File)

Next Stage Plan [R]

or

Exception Plan [R]



The three key inputs to this Process are:

♦ the Management Stage which has just been completed (the Current Stage Plan)

♦ the Next Management Stage Plan created in SB1

♦ the approved Project Plan

Actual schedule, effort and cost information is extracted from the Current Stage Plan and

any changes proposed in the Next Stage Plan are used to present an up-to-date view of thelikely final out-turn for the project.

Other inputs are also available to this Process from a number of sources; the main

objective is to present a comprehensive view of what the Project Board is being asked tocommit to, long term, at the approaching End Stage Assessment.

Any significant changes in the Project Plan brought about by this Process should be

included in the End Stage Report produced by the Project Manager for the Project Board.


227

SB3 - Updating A Project Business Case

The Business Case is the main driving force behind any PRINCE 2 controlled and this

must be kept up to date and reviewed at the completion of each Management Stage as a

minimum requirement.


USED

OUTPUT TO

Business Case [U] Reporting Stage End(SB5)

SB3 – Up-Dating AProjectBusinessCase

Up-Dated ProjectPlan (SB2)

Exception Plan orNext Stage Plan(SB2)

Risk Log (SB4)

Issue Log (SB4)

Risk Log [R] Reporting Stage EndSB5)


Many events would have occurred during the previous Management Stage which will

impact the Business Benefits which were used to justify the project initially and at the last

formal Project Board Review. For example, if the overall project plan has been extendedor its predicted out-turn cost increased then there will be a detrimental effect on the

Business Benefits; the reverse is also true!

On the positive side, it can be expected that the risks faced by the project will be reducedas progress is made. This aspect is treated in SB4 - “Updating The Risk Log” but needs to

be considered here as the two topics are very closely related.

Changes requested (and made) during the Management Stage will also impact on theBusiness Benefits, especially where required changes for improved functionality have

incurred additional effort and costs.


228

SB4 -Updating The Risk Log

As the project proceeds towards its planned conclusion, the risks faced for delivering on

time, within budget and to the required specification should reduce. This must be recorded

and presented to the Project Board when they are being asked to approve the nextManagement Stage Plan.


USED

OUTPUT TO

Risk Log [U] Up-Dating A ProjectBusiness Case (SB3)

Accepting A WorkPackage (MP1)

SB4 – Up-Dating TheRisk Log

Project Plan (SB2)


Exception Plan(SB2)

Issue Log CS4(Quality File)

Issue Log [U] Up-Dating A ProjectBusiness Case (SB3)


Essentially the Risk Management Component comes back into play and the project risk re-

assessed. Although PRINCE 2 does not include any requirement to use any specific risk

management tool the Risk Analysis Checklist described in Chapter 6 can be used to updatethe risks. Whatever approach is used, the results must be logged and presented to the

Project Board at the End Stage Assessment. The Risk Log should indicate a downward

trend if the project is to proceed without any changes. Significant increases in the riskmeasurement must always be brought to the attention of the Project Board and

recommendations made.

Ownership of each identified risk should always be considered - the most appropriate

member of the Project Management Team being best placed to keep a watchful eye onmovements against the baseline.

Changes in approach, planning and resource usage will always have a potential impact on

the risks facing the project and so changes to the Project Plan or Next Stage Plan shouldalways be reviewed for their impact within this Process.


229

SB5 - Reporting Stage End

The results of a Management Stage needs to be reported back to those who have provided

the resources which have contributed to its completion


USED

OUTPUT TO

End Stage Report [C] Authorising A Stage orException Plan (DP3)

Request for Authorisation ToProceed [C]

Authorising A Stage orException Plan (DP3)

Next Stage Plan [R] Authorising A Stage orException Plan (DP3)

Exception Plan [R] Authorising A Stage orException Plan (DP3)

Risk Log [R] Authorising A Stage orException Plan (DP3)

Product Status Account [C] De-Commissioning AProject (CP1)

SB5 –ReportingStage End

Project Plan (SB2)

Current Stage Plan(SB2)

Next Stage Plan orException Plan(SB2)

Business Case(SB3)

Issue & Risk Logs(SB3)

Quality Log (CS5)(Quality File)

CommunicationPlan (IP4) (ProjectFile)

Communications to interestedparties [C]



This Process is activated as near as possible to the end of the Current Management Stage.

The results of the Process are presented as an End Stage Report which summarises the

result of the Management Stage; the report provides the following information to the

Project Board:

♦ Planned vs out-turn costs

♦ Planned vs out-turn effort


230

♦ Planned vs out-turn milestone dates

♦ Products delivered (and confirmation they meet the stated Quality Criteria

The End Stage Report acts as the vehicle for presentation of the Stage results and the NextStage Plan to the Project Board.

Responsibility for creation of the report rests with the Project Manager, with help and

support from the Project Management Team as appropriate. It will be provided up to a

week in advance of the End Stage Assessment to allow Project Board members to considerits content; arrangements for handling Management Stage endings to allow for this are

discussed in the Chapter on Understanding The Stages Component.


231

SB6 - Producing An Exception Plan

As soon as it is forecast that a Management Stage is likely to deviate beyond the

Tolerance set by the Project Board at the previous End Stage Assessment, it is deemed to

be in Exception and an Exception Report must be prepared for the Project Board. The

likelihood is that the Project Board will require an Exception Plan to be prepared and this

Process is where such a plan is created.


USED

OUTPUT TO

SB6 –ProducingAnExceptionPlan


Stage Plan (CS8)

Exception PlanRequest (DP4)

Exception Plan [C] Up-Dating A ProjectPlan (SB2)



Standard Tolerance is measured in Time (Schedule) and Cost. For each Management

Stage Tolerance is recommended by the Project Manager, based on the latest assessmentof risk and the nature of the work, and confirmed by the Project Board at the End Stage

Assessment. There is a separate component within PRINCE 2 for Tolerance described in

the Controls Component. Additional Tolerances might be usefully considered – theseinclude Scope, Quality and Risks.

The Exception report, raised by the Project Manager as soon as it is forecast that Tolerance

will be exceeded, describes the nature of the exception, its impact on the Management

Stage and Project, the options open to recover the situation, and the recommendation bythe Project Manager. The Exception Report is considered in “Giving Ad-Hoc Direction

(DP4)” by the Project Board members (although no specific meeting or control for this

consideration is identified by PRINCE).

The Project Board will normally require an Exception Plan to be created to replace the

approved plan which has been departed from; they might, of course decide to prematurely

terminate the project or to just live with the departure but this could not be described asrealistic management.

This Process creates the Exception Plan which will be approved by the Project Board in

“Authorising A Stage or Exception Plan (DP3)” Process at a specially convened Mid

Stage Assessment.


232

Summary of the Managing Stage Boundaries Process

The “Managing Stage Boundaries Process (SB)” Process will always be present in a

PRINCE 2 controlled project (since every PRINCE project will have a minimum of two

Management Stages, and therefore at least one SB Process).


USED

OUTPUT TO

Next Stage Plan [C] Up-Dating A ProjectPlan (SB2)

Project Plan [R] Up-Dating A ProjectPlan (SB2)

Project Management TeamChanges [U]


SB1 –Planning AStage

Current Stage Plan(CS5) (Stage File)

Stage EndNotification (CS5)

Project Plan (IP2)(Project File)

Trigger For NextStage Plan (IP2)


Current ProjectManagement Team(IP6) (Project File &Stage File)

Product Checklist [U] Reporting Stage End(SB5)

Up-Dated Project Plan [U] Up-Dating A ProjectBusiness Case (SB3)


Up-Dating The Risk Log(SB4)

SB2 – Up-Dating AProject Plan

Current & NextStage Plans (SB1)

Exception Plan(SB6)

Project Approach(IP6) (Project File)

Project Quality Plan(IP6) (Project File)

Next Stage Plan [R]

or

Exception Plan [R]



233

Business Case [U] Reporting Stage End(SB5)

SB3 – Up-Dating AProjectBusinessCase

Up-Dated ProjectPlan (SB2)

Exception Plan orNext Stage Plan(SB2)

Risk Log (SB4)

Issue Log (SB4)

Risk Log [R] Reporting Stage EndSB5)

Risk Log [U] Up-Dating A ProjectBusiness Case (SB3)

Accepting A WorkPackage (MP1)

SB4 – Up-Dating TheRisk Log

Project Plan (SB2)


Exception Plan(SB2)

Issue Log CS4(Quality File)

Issue Log [U] Up-Dating A ProjectBusiness Case (SB3)

End Stage Report [C] Authorising A Stage orException Plan (DP3)

Request for Authorisation ToProceed [C]


Next Stage Plan [R] Authorising A Stage orException Plan (DP3)

Exception Plan [R] Authorising A Stage orException Plan (DP3)

Risk Log [R] Authorising A Stage orException Plan (DP3)

Communications to interestedparties [C]


SB5 –ReportingStage End

Project Plan (SB2)

Current Stage Plan(SB2)

Next Stage Plan orException Plan(SB2)

Business Case(SB3)

Issue & Risk Logs(SB3)

Quality Log (CS5)(Quality File)


Product Status Account [C] De-Commissioning AProject (CP1)

SB6 –ProducingAnExceptionPlan


Stage Plan (CS8)

Exception PlanRequest (DP4)

Exception Plan [C] Up-Dating A ProjectPlan (SB2)


Figure 109: Summary of the “Managing Stage Boundaries (SB)” Process


235

UNDERSTANDING THE

CLOSING A PROJECT

PROCESS

Chapter 18


237

Closing A Project (CP) - Introduction

At its conclusion, the project must be closed down in an orderly and firm manner. The

end of a project may arise when all the planned work has been completed and the

Products/Deliverables finished and signed off as meeting their stated Quality Criteria.

Alternatively a project might be brought to a premature conclusion because of changes to

requirement, removal of resources or unacceptable slippage of time, effort or costs.

Figure 110: Closing A Project (CP) Process

Most of the work involved in this major Process is concerned with preparation of

information for the Project Board in order for it to make the decision to close the project,

or not. Rather like Project Initiation and Stage Initiation, this Process provides a decision-

support structure; it aims to:

♦ ensure that the Objectives for the project have been met;

♦ confirm that the Customer is Satisfied with the outcome;

Project

Evaluation

Review

CP3

Confirming

Project

Closure

DP5

De-

commissioning

a Project

CP1

Identifying

Follow-on

ActionsCP2

Reviewing

Stage Status

CS5

Reporting

Stage End

SB5

Giving ad hoc

Direction

DP4

Follow-on Action

Recommendations

Post-Project

Review Plan

Issue, Risk and

Quality Logs

Lessons Learned

Report

Project Files

Notification of

approaching

Project End

Premature

Close

Product Status

Account

PID

Project Closure

Notification

Operational and

Maintenance

Acceptance

Customer Acceptance

Lessons Learned

Report

End Project Report


238

♦ obtain Formal Acceptance of the project Products/Deliverables;

♦ confirm that all Products/Deliverables have been handed over to the Customer, and

that these have been accepted;

♦ ensure that where Ongoing Support, enhancement and maintenance is appropriate (andrequired), suitable provision has been made;

♦ identify any recommendations for Follow-on Actions and document;

♦ Capture “Lessons Learned” and publish these in a suitable report for the Project

Board;

♦ Prepare an “End Project Report” for sign-off by the Project Board;

♦ Notify the Customer/Sponsor/Host Organisation, as appropriate, of the Intention to

Close the project, disband the project organisation and release the resources.

Obviously, it will be difficult to close down a project in an orderly manner if the

expectations and criteria for completion and close-down have not been agreed at the outset

and this will normally have been done and the final Acceptance Criteria included withinthe Project Initiation Document. Project staff and managers should be provided with as

much notice as possible in order for them to plan their return to normal operations.

Thanks to those who have contributed to the project are also in order!


239

CP1 - Decommissioning A Project

The main aim of this Process is to bring the project to an orderly close, ensuring that the

Customer is happy with the outcome and demonstrates this by providing a Customer

Acceptance sign-off. Assurance that the outcome can be supported and that a proper audit

trail exists for the project documentation, should it be needed in the future, must also be

forthcoming.


USED

OUTPUT TO

Project Closure Notification [C] Confirming ProjectClosure (DP5)

Operational & MaintenanceAcceptance [C]

Confirming ProjectClosure (DP5)

Customer Acceptance [C] Confirming ProjectClosure (DP5)

Draft communication to interestedparties [C]


CP1 – De-Commissioning AProject

Premature Close(DP4)

Notification ofProject End (CS5)

Product StatusAccount (CS5)

Issue Log (SB5)



Project Files [R] Archives

Figure 111: CP1 Plus Inputs and Outputs

Key features of CP1 are:

♦ Checking that all Project issues have been dealt with;

♦ Checking that all Products have been completed, documented and handed over;

♦ Confirmation that the Customer’s Specification has been addressed;

♦ Confirmation that the outcome can be supported, operationally;

♦ Archive of all project documentation (mainly for audit purposes);


240

♦ Notify all concerned that the project is coming to a conclusion and resources will be

returned.

This Process is primarily the responsibility of the Project Manager in that it marks the

conclusion of the work performed over what will often be a considerable period of time.

There will be a need for close contact between the Project Manager and Project Board

members to ensure there are “no surprises” at the final meeting to close the projectformally.


241

CP2 - Identifying Follow-on Actions

Essentially picking up any loose ends that remain at the conclusion of the project. In

particular any outstanding changes in requirements, raised as Project Issues, which were

not actioned for fear of prejudicing a contractual situation or because time and budget did

not allow the changes to be introduced. There might also have been some general

technical improvements that would benefit the project’s outcome that the Supplier wishesto bring to the Customer’s attention.


USED

OUTPUT TO

Post-Project Review Plan [C] Confirming ProjectClosure (DP5)

CP2 -IdentifyingFollow-OnActions

Business Case(SB5)

Risk Log (SB5)

Issue Log (SB5)Follow-On ActionRecommendations [C]


Figure112: CP2 Plus Inputs and Outputs

A major output from this Process is the Post-Project Review Plan which will be used to set

up a future project to review whether the Business Benefits identified at the outset (and

reviewed and updated at each formal review) of the project, have been achieved. This will

usually take place between 6-12 months after the project has been formally closed.

The follow-on Actions Recommendations will provide the basis for Project Mandates for

any future projects which may arise from the recommendations made.


242

CP3 – Project Evaluation Review

The lessons learned during the project must be captured as it progresses and disseminated

to those in the host organisation that would benefit from it at the conclusion of the project.

There is also a need to compare what was intended to be achieved by the project against

what was actually achieved. This review addresses the project and its outcome rather than

the outcome itself (which will the subject of a Post-Project Review (see CP2).


USED

OUTPUT TO

Lessons learned Report [U] Confirming ProjectClosure (DP5)

CP3 -ProjectEvaluationReview

Lessons LearnedReport (SB5)

Risk Log (SB5)

Quality Log (SB5)

Issue Log (SB5)


End-Project Report [C] Confirming ProjectClosure (DP5)

Figure 113: CP3 Plus Inputs and Outputs

The Lessons Learned Report (Log) is a prime input to this Process, along with the variousLogs needed to provide a comprehensive view of the performance of the project.

The outputs are:

♦ An assessment of the project against its targets;

♦ An examination of the records to establish how well the Project Management and

Quality Management Standards performed and to what extent they supported the

project;

♦ Identify any lessons learned and to recommend changes to the existing standards.

The Project Manager has responsibility to produce these analyses and present them to the

Project Board


243

Summary of the Closing A Project Process

Closing A Project provides the “housework” tasks for properly shutting down a project.

Authority for closure can only be given by the Project Board. The Process is essential for

an orderly and effective shut-down of the project.


USED

OUTPUT TO

Project Closure Notification [C] Confirming ProjectClosure (DP5)

Operational & MaintenanceAcceptance [C]


Customer Acceptance [C] Confirming ProjectClosure (DP5)

Draft communication to interestedparties [C]


CP1 – De-Commissioning AProject

Premature Close(DP4)

Notification ofProject End (CS5)

Product StatusAccount (CS5)

Issue Log (SB5)



Project Files [R] Archives

Post-Project Review Plan [C] Confirming ProjectClosure (DP5)

CP2 -IdentifyingFollow-OnActions

Business Case(SB5)

Risk Log (SB5)

Issue Log (SB5)Follow-On ActionRecommendations [C]


Lessons learned Report [U] Confirming ProjectClosure (DP5)

CP3 -ProjectEvaluationReview

Lessons LearnedReport (SB5)

Risk Log (SB5)

Quality Log (SB5)

Issue Log (SB5)


End-Project Report [C] Confirming ProjectClosure (DP5)

Figure 114: Summary of the Closing A Project (CP) Process


245

UNDERSTANDING THE

PLANNING

PROCESS

Chapter 19


247

Planning (PL) - Introduction

Planning embraces PRINCE Components, Processes, and Techniques and is an on-going

activity throughout the project. Understanding of the tasks involved and the possible

pitfalls will emerge from planning the project and stages; control can only be exercised in

as much detail as the project plan allows; and the approaches to planning, using manual or

software supported techniques is a matter of preference and choice for the implementingorganisation.

Planning for all but the smallest projects is best tackled using a software support tool as

the time saved in the longer term will more than repay the initial outlay, especially wherecomplicated inter-dependencies exist between Products and Activities.

Figure 115: Planning (PL) Process

The philosophy behind the PRINCE 2 planning concepts are:

♦ Plans are constructed by identifying the final Products/Deliverables and all associatedintermediate Products/Deliverables;

Completing aPlan

PL7

(Identifying),

Defining and

Analysing

ProductsPL2

Designing aPlan

PL1

IdentifyingActivities and

DependenciesPL3

AnalysingRisks

PL6

DefiningProjectApproach

SU5

PlanningQuality

IP1

Planning anInitiation Stage

SU6

Planning a

Project

IP2

Planning aStage

SB1

Scheduling

PL5

Estimating

PL4

Authorising a

Project or Plan

DP2 or DP3

Reviewing

Stage Status

CS5

Giving ad hoc

Direction

DP4

Plan

Design

Product

Flow

Diagrams

Product

Descriptions List of

Activities

Estimate

d

Activities

Resourc

e

availabilit

y

Risk Log

Completed

Plan for

approval

Product

Checklist

Assessed

PlanSchedule

Draft Product

Checklist

Activ

ity d

epen

den

cies

Producing anExceptionPlan

SB6


248

♦ Products/Deliverables are defined and specified by producing associated Product

Descriptions;

♦ The Activities and associated Resources are identified; all Activities must be thoughtthrough to a level consistent with the control requirements identified in the Project

Initiation Document;

The planning framework incorporated in PRINCE 2 is intended to cater for any type or

size of project - after given due consideration to the design of the plan (content, softwaretool to be used, levels of planning, detail of content required etc.) the steps are:

♦ Step 1:

Identify and Define what Products/Deliverables are needed;

♦ Step 2:

Determine the sequence in which each Product/deliverable should be produced;

♦ Step 3:

Identify the Activities needed for the creation of the Products/Deliverables;

♦ Step 4:

Estimate the Resource Requirements and calculate the durations (elapsed times)

where appropriate;

♦ Step 5:

Schedule the Activities (usually using a software planning tool;

♦ Step 6:

Schedule the Resource Requirements (usually at the same time as scheduling theActivities);

♦ Step 7:

Review the Plan especially in respect of Risks and determine the need for any

contingency planning;

♦ Step 8:

Finalise the Plan by assembling all the information and creating a Plan Text;

♦ Step 9:

Print the Plan and obtain approval from the appropriate project authority.


249

PL1 - Designing A Plan

PRINCE 2 defines the plan as “the backbone” of every project; essentially it is not

possible to control in any more detail than that planned, so the best advice is to plan in

detail and then select the level of control appropriate to the risk and understanding there is

for the project.


USED

OUTPUT TO

PL1 –Designing APlan

Project Approach(SU5) (Project File)

Project Quality Plan(IP1) (Quality File)

Project Brief (SU4)(Project File)

Or

Project InitiationDocument (IP6)(Project File)

Company PlanningStandards

Plan Design [C] Relevant Process

Figure 116: PL1 Plus Inputs and Outputs

The Process addresses the fundamental decisions that must be made about planning before

any real planning can commence. Decisions must be taken about the approach to planning

and the style of presentation. The required number of levels of plan (Project-level andStage-level plans are required in PRINCE controlled projects) and the amount of

information to be included to provide the Project Board with adequate decision-support

must be clearly understood.

Use of software tools for estimating and planning (and possibly for preparation of analysistools such as Product Flow Diagrams) must be considered and decisions taken. Decisions

on software tools will affect the means of establishing control, especially how “actuals”

are to be captured and reflected in the approved plans as the project progresses (see“Controlling A Stage (CS2)” Process).


250

PL2 - Identifying, Defining And Analysing Products

The benefits of Product-based planning is that management and the Project Management

Team can be assured that all planned activity within the project is geared towards

providing known, required Products or Deliverables that will all contribute towards the

final outcome. As the activities within a project always consume resources (time, effort

and money) then management can be confident that no resource is being wasted oncarrying out unnecessary work.

This Process requires the Project Manager to identify the required Products for the Project

(A Product Breakdown Structure), Define each Product in terms of a Product Description,and then analyse the relationship of Products with each other (and the outside world) by

producing a Product Flow Diagram.

Each of these three Product Plans is described and illustrated in the Chapter on“Understanding The Product Based Planning Component and Technique”.


USED

OUTPUT TO

Product Breakdown Structure [C] Relevant Process

Product Descriptions [C] Identifying Activities &Dependencies (PL3)

Relevant Process

Product Flow Diagram [C] Identifying Activities &Dependencies (PL3)

Relevant Process

PL2 –(Identifying)Defining &AnalysingProducts

Project Approach(SU5) (Project File)

Project Quality Plan(IP1) (Quality File)

Draft Product Checklist [C] Completing A Plan(PL7)

Figure 117 : PL2 Plus Inputs and Outputs

For a Project Plan it will not always be possible (or desirable) to identify and define all the

Products for the life of the project. An attempt should be made, however, to present themost comprehensive information available to the Project Board. Often this will be limited

to a statement of the name and a brief description of the expected Product. Planning at

Management Stage level is quite different - a firm commitment in terms of Products,Activities and Resources required must be made and a fully-featured plan created. If this


251

is not possible, consideration must be given to moving the Management Stage boundaryforward to the point where a firm commitment can be made.

The Product Checklist is a useful means of identifying Products (at Project-level and

Management Stage-level), showing their planned Milestone dates and, subsequently, the

achievement dates.


252

PL3 - Identifying Activities And Dependencies

The Product Flow Diagram can be put to use to identify the Activities within the plan and

to provide an indication of the likely dependencies between them.

PROCESS INPUT &SOURCE

PRODUCTS CREATED,UPDATED, REFERENCED OR

USED

OUTPUT TO

PL3 –IdentifyingActivities &Dependencies

Product FlowDiagram (PL2)

ProductDescriptions(PL2)

Risk Log (ProjectFile)

List of Activities [C]

and

Activity Dependencies [C]

Scheduling (PL5)


Each connection between Products (and external entities) on the Product Flow Diagram

represents one or more potential activities to be carried out to create the Product. Armed

with this principle, the Project Manager or planner can derive the raw data to plan theactivities of the Project, Management Stage or Team Plan. The process of deriving

activities from the Product Flow Diagram is also known as “Transformation”.


253

PL4 - Estimating

Accuracy and consistency of estimating is perhaps the single most important aspect of

project management. PRINCE 2 devotes little space to how to estimate the project

activities as it relies on the availability of specific approaches and techniques being

available within the organisations involved in the project.


USED

OUTPUT TO

PL4 –Estimating

All PlanningInformation

Activity Estimates [C] Scheduling (PL5)


Organisations wishing to formalise their estimating methods and procedures will wish to

consider Function Points Analysis Mark 2 which is a license-free estimating method,

owned by CCTA and placed in the public domain to support the PRINCE and StructuredSystems Analysis and Design (SSADM) Methods. The Method is suitable only for IT

projects but the principles can be adapted for other types of project if required.

Other methods of estimating are “Delphi” which is essentially asking experienced people(oracles) to provide the answer! This approach can be structured and formalised by

obtaining a “first-cut” estimate from each individual and gradually refining the estimates

through filters until the most optimistic, most pessimistic, and most likely by consensus isobtained and using the following formula to create the final estimate:

1 x Most Optimistic + 1 x Most Pessimistic + 4 x Most Likely

6

This approach may not be very scientific but has been around and used effectively formany years!


254

PL5 - Scheduling

Scheduling requires the creation of a Programme Evaluation and Review Technique

(PERT) Network and a Gantt (Timescale) Plan. This will usually be done using a

Software planning tool such as MS Project. There is no requirement in the Method touse a software tool but it will be a great timesaver in all but the smallest of projects.


USED

OUTPUT TO

PL5 –Scheduling

List of Activities(PL3)

and

ActivityDependencies(PL3)

Activity Estimates(PL4)

Schedule [C] Scheduling (PL6)

Relevant Process


The techniques used in this Process are fully explained in the Chapter on “Understanding

The Product-Based Planning Component and Technique”. At the same time that

activities are being inserted into a software support tool, the planner will be prompted toenter resource availability and estimating information. The plan created in this Process

addresses both the work to be done, including start and finish dates, and the people needed

to work on them; it will also provide information on bought-in resources (such as fixed-price sub-contracted work) and equipment.

From the information provided, Resources Reports can be generated for the Project

Management Team and the Project Board members. Where a software support tool is not

being used, a separate Resource Plan will need to be produced to inform the Project Boardof the commitment of resources that is being asked of them.


255

PL6 - Analysing Risks

Before a plan can be completed the risks must be re-visited to ensure that any appropriate

contingency planning has been catered for. Risks should, of course, also be addressed at

the outset of planning and through every step.


USED

OUTPUT TO

Risk Log [U] Completing A Plan(PL7)

PL6 –AnalysingRisks



Schedule (PL5)Assessed Plan (Schedule) [U] Completing A Plan

(PL7)

Figure 121 : PL6 Plus Inputs and Outputs

Each of the resources planned for should be examined and considered for potential riskand action taken to include a contingency in the plan. Risks can arise from many sources

including:

♦ Quality issues;

♦ Past ability to meet deadlines;

♦ Commitment from Management and Team members;

♦ Past Sub-Contractor performance;

♦ Sources of labour and skill types;

♦ Foreseen and unforeseen external events;

♦ Other initiatives currently under way;

♦ Deadlines set for the project;

♦ Self-belief.


256

PL7 - Completing A Plan

The plans addressed in PL2 - PL5 are largely support documents for presenting

information to those responsible for decision-making (mainly the Project Board). To

conclude the plans the Project Manager or Team Manager must draw all the elements

together and provide a brief summary addressing all the salient points; this is known as

the “Plan Text”.


USED

OUTPUT TO

Plan Text [C]

Plus

Completed Plan For Approval [U]

Relevant Process andApproval By ProjectBoard/Project Manager

PL7 –CompletingA Plan

Assessed Plan(Schedule)(PL6)

Draft ProductChecklist (PL2)

Product Checklist [U] Project or Stage File


A Plan Text describing the plan in straightforward language is created and the variousplans and analysis sheets appended to it. The Product Checklist (initially created in “IP2 –

(Identifying), Defining And Analysing Products”) is also completed by the insertion of

planned start and completion dates for each of the Products.

It is in this Process that consideration should also be given to creating a “Graphical

Summary of the Plan” which, although not a part of the stated PRINCE 2 plan package, is

an invaluable aid to the Project Board and other members of senior management in

understanding what the plan is trying to achieve.


257

Summary of the Planning (PL) Process

Planning is uses throughout the PRINCE 2 Method. In many ways it is unhelpful to viewplanning as a “Process” - it is essentially a “Technique” used on a day to day basis and

coming into prominence at the beginning of the project and at the end of each

Management Stage.

PROCESS INPUT &SOURCE

PRODUCTS CREATED,UPDATED, REFERENCED OR

USED

OUTPUT TO

PL1 –Designing APlan

Project Approach(SU5) (ProjectFile)

Project QualityPlan (IP1)(Quality File)

Project Brief(SU4) (ProjectFile)

Or

Project InitiationDocument (IP6)(Project File)

CompanyPlanningStandards

Plan Design [C] Relevant Process

Product Breakdown Structure [C] Relevant Process

Product Descriptions [C] Identifying Activities &Dependencies (PL3)

Relevant Process

Product Flow Diagram [C] Identifying Activities &Dependencies (PL3)

Relevant Process

PL2 –(Identifying)Defining &AnalysingProducts

Project Approach(SU5) (ProjectFile)

Project QualityPlan (IP1)(Quality File)

Draft Product Checklist [C] Completing A Plan(PL7)


258

PL3 –IdentifyingActivities &Dependencies

Product FlowDiagram (PL2)

ProductDescriptions(PL2)


List of Activities [C]

and

Activity Dependencies [C]

Scheduling (PL5)

PL4 –Estimating


Activity Estimates [C] Scheduling (PL5)

PL5 –Scheduling

List of Activities(PL3)

and

ActivityDependencies(PL3)

ActivityEstimates (PL4)

Schedule [C] Scheduling (PL6)

Relevant Process

Risk Log [U] Completing A Plan(PL7)

PL6 –AnalysingRisks



Schedule (PL5)

Assessed Plan (Schedule) [U] Completing A Plan(PL7)

Plan Text [C]

Plus

Completed Plan For Approval [U]

Relevant Process andApproval By ProjectBoard/Project Manager

PL7 –Completing APlan

Assessed Plan(Schedule)(PL6)

Draft ProductChecklist (PL2)

Product Checklist [U] Project or Stage File

Figure 123: Summary of the Planning (PL) Process


259

UNDERSTANDING THE

PRINCE 2 FILING

TECHNIQUE

Chapter 20


261

PRINCE 2 Filing Technique - Introduction

PRINCE 2 suggests a suitable filing structure based on three different types of file:

♦ The Management File (Broken down into an overall Project File and a series of StageFiles)

♦ The Specialist File

♦ The Quality File

Figure 124: Summary of the PRINCE 2 Suggested Filing Structure

There is no requirement in the Method to adopt the suggested filing structure -

implementing organisations are free to retain their existing standards or to modify the

suggested structure to suit their own requirements.

The Management File

This comprises the following components:

The Project File (One File for the Whole Project):

♦ The Project Organisation Structure Chart and agreed/signed-off Job Descriptions;

♦ Project-level Plans:

♦ Project-level Product Breakdown Structure;


Plans

Business Case

Risk Log

Control Documents

Products Checklist

Files


Plans

Control Documents

Daily Log

Correspondence

Products Checklist


Configuration Log

CI Locations

Off-Specifications


Quality Checks

Project Issues


262

♦ Project-level Product Flow Diagram;

♦ Timescale Plan (Project-level Gantt Plan);

♦ Project-level PERT Network;

♦ Project Resource Report;

♦ The Business Case:

♦ Business Benefits Assessment;

♦ Risk Assessment & Proposals;

♦ Risk Log;

♦ Control Documentation:

♦ the Project Initiation Document;

♦ End Project Report

♦ The Lessons Learned Report;

♦ Products Checklist;

♦ Products Status Account;

♦ Follow-On Items;

♦ Post-Project Review Plan;

♦ Project Closure Sign-off Document


263

Figure125: Comprehensive View of the Project File

The Management Stage Files (one file or section for each Management Stage

of the Project):

♦ Management Stage Organisation Structure Chart and agreed/signed-off JobDescriptions; this will relate to the Team Members.

♦ Management Stage and any lower-level Plans:

♦ Stage-level Product Breakdown Structure;

♦ Stage-level Product Descriptions (The Master Product Descriptions will be stored

in the Quality File);

♦ Stage-level Product Flow Diagram;

♦ Stage-level Timescale Plan (Gantt Plan);

♦ Stage-level PERT Network;

♦ Stage-level Resources Report;

♦ Exception Plans and associated documentation.

♦ (nb: The Stage Plans should normally be up-dated to reflect “actuals” at least

once every week)

♦ Management Stage-level Control Documentation:

♦ Copies of Work Package Authorisations;

Management File - Project File

* Project Mandate* Project Brief

* Project Organisation Structure

* Project Organisation Roles & Responsibilities

* Project Approach* Project Board Approval For Initiation

* Baselined Project Initiation Document* Project Filing Structure Summary

* Project Board Approval For The Project

* Record of End Stage Assessments

* Record of Mid Stage Assessments

* Product Checklist (Project Level Products)* Highlight Reports

* Exception Reports (Project)

* Project End Notification

* Business Case (Initial & Updates)

* Project Plan (Initial & Updates)

* Risk Log

* Lessons Learned Report

* Project Closure Recommendation* Post Implementation Review Plan

* End Project Report


264

♦ Checkpoint Reports, Highlight Reports;

♦ Exception Reports;

♦ End Stage Assessment and Mid Stage Assessment records and formal Project

Board sign-offs.

♦ Products Checklist for the Management Stage Products;

♦ Daily Log recording events, problems questions, informal discussions with Project

Board members and other senior managers and resultant actions impacting on theManagement Stage.

♦ Correspondence - management correspondence and other papers relevant to the

Management Stage.


265

Figure 126: Comprehensive View of the Stage File

The Specialist File (One File for the whole Project):

♦ The Configuration Items for the project and the Configuration History (changes,

version etc); log-out and in information. Correspondence relating to a specificConfiguration Item will be associated with the item it addresses.

♦ Physical Location of each Configuration Item.

♦ A copy of the relevant Product Description for each Specialist Product may be

included for completeness. (The Master Product Descriptions will be stored in theQuality File);

♦ Specialist General Correspondence especially where a number of Configuration Items

are referred to.

Figure 127: Comprehensive View of the Specialist File

Specialist File

* Configuration Items

* Location of Configuration Items

* Log of Configuration Items

* Off Specifications For Configuration Items

* Correspondence Relating To Specialist Products

Management File - Stage File

* Stage Organisation Structure

* Stage Organisation Roles & Responsibilities

* Current Stage Plan

* Project Board Approval For The Stage

* Work Package Authorisation (Contract)

* Checkpoint Reports

* Exception Reports (Stage Level)* Product Checklist (Stage Level Products)

* End Stage Report

* Daily Log

* Correspondence


266

The Quality File (One File for the Whole Project):

• The Master Product Descriptions;

• Quality Control Documentation

• Selection Criteria for Quality Reviewers;

• Invitations to Quality Reviews;

• Error/Observations Lists;

• Follow-up Actions List;

• Reviewers’ Sign-offs for each Configuration Item will be stored either here or in theSpecialist File, associated with the relevant product.

• Project Issues;

• Project issues Log.

Figure 128: Comprehensive View of the Quality File

Physical Filing Considerations

The files themselves may take on a variety of guises from a consolidated four-post binder

for a small project to a whole room of filing cupboards for a major initiative. The Method

has no views on the physical implementation of filing arrangements.

It will often be sensible to establish an electronic filing structure to help standardise the

filing arrangements within the implementing organisation.

Quality File

* Master Product Descriptions

* Quality Review Documentation - Invitations

- Error Lists

- Follow-up Actions - Sign-offs/Results

* Project Issues

- Issue Log

- Project Issues - Requests For Change

- Off-Specifications



* Stage Quality Plan

* Quality Log


267

UNDERSTANDING THE

QUALITY REVIEW

TECHNIQUE

Chapter 21


269

PRINCE 2 Quality Review Technique - Introduction

In PRINCE projects, quality is controlled through a number of quality management

procedures and techniques. Used correctly, in appropriate circumstances and in

conjunction with Product Descriptions (see the Product-Based Planning Technique), the

Quality Review is one of the most powerful of the techniques used within the Method.Quality within PRINCE 2 is embedded within each of the Components, Processes and

Techniques; it is not perceived as something separate that can be applied after a Product

or Deliverable has been produced, or even at isolated points during the product cycle.

Quality Assurance and Quality Control

It is well worth viewing the concepts of Quality Assurance and Quality Control as

different, but mutually supportive, Quality Assurance will normally be present in the

form of a published and defined Quality Management System, often implemented against

the BS/EN/ISO9001 standard.

A Quality Management System (QMS) provides the all important backdrop to managing

quality throughout the whole organisation and provides an environment of confidence forstaff and customers alike. This confidence manifests itself in a considered, professional

approach to all tasks undertaken by all personnel - ensuring that the primary objective of

the control functions - the Quality Review Technique, for example - is to confirm that all

project deliverables meet their stated Quality Criteria (contained within the appropriateProduct Description) rather than to identify perceived deficiencies and mistakes.

Some organisations may find they are at odds with this approach, having spent manyyears using quality control techniques to pick up faults and planning re-work of

deliverables as an inevitable outcome of the quality checks. But it does not have to be

like this - given a sensibly written set of quality procedures, published in the form of aQuality Management System, reflecting the principles of BS/EN/ISO9001 and regularly

audited by internal and external auditors, any organisation can enjoy a quality

environment, where “getting it right first time” is the watchword for all staff.

What is a Quality Review?

PRINCE 2 describes a Quality Review as “an involved partnership designed to ensure a

Product’s completeness and adherence to standards by a review procedure”. In essence a

Quality Review is a review of a Product with the emphasis on checking for errors and

omissions, and non-compliance with the stated Quality Criteria. The PRINCE 2 Quality

Review has a clear and defined structure which when followed will produce the requiredresults.


270

Quality Reviews - Formal and Informal

Quality Reviews can be either formal, for example a scheduled meeting, or informal. The

selection of the type of quality control is the responsibility of the Project Manager,

endorsed by the Project Board at the Project Initiation or End Stage Assessment meetings.

The Project Manager will consider the relative importance of each project deliverable in

reaching a final decision on whether to recommend a formal or informal Quality Review

but whatever the decision, the objective is the same - to confirm that the product ordeliverable under review conforms to its stated and agreed Quality Criteria.

An informal Quality Review may take many forms. A simple test or visual inspection tocheck out the Product may be both sensible and acceptable. A "desk-check" may be

carried out. This might be performed by the author's line manager, or could be carried out

by an expert Reviewer either within or outside the project, site or organisation. In many

cases a physical test of the deliverable will be the obvious way to assure compliance withthe Quality Criteria. In all circumstances, the documentation must be produced to record

the review and to provide the essential “audit trail”.

People Involved

Those involved in the Quality Review process are:

♦ The Producer: who is usually the creator/ author of the Product being reviewed.

♦ The Review Chair: who may be the Producer’s line manager, the Project Manager,

or any other competent person with authority (or perceived authority).

♦ The Reviewers: who must be competent to assess the Product from their particularspecialist viewpoints.

♦ The Scribe: who will take notes of the agreed actions arising from the review.

♦ Project Support: providing administrative support for the Quality Review technique;this will typically include arranging the venue, sending out invitations and providing

the scribe role, taking note of the follow-up actions during the meeting.

♦ Project Assurance and Quality Assurance: assuring the effective use of the Quality

Management System and the techniques associated with it, and monitoringappropriate use of organisational, industry and ethical standards on behalf of the

Project Board and senior managers.


271

The Quality Review Steps

Detailed procedures for carrying out a Quality Review will normally be specified by the

organisation’s own Quality Management System, but where such a system is not

published, the following arrangements will be found to work successfully.

Step 1 - Preparation

The objective of this step is to examine the Product or Deliverable under review against

its Product Description and to create a list of queries, possible errors, and topics that

warrant re-examination.

♦ The Chair will check with the Producer that the product will be ready on time and

ensure that the team of Reviewers is agreed and that they will all be available.

♦ An invitation to the Quality Review, indicating the Product, time and place for the

review is sent with copies of the Product and the Product Description. Any specific

Standards used in the production of the Product would normally be available to allproject personnel - if not a copy of the relevant Standard used to produce the

deliverable should be attached. This should dispatched between one and five days

before the review.

♦ Each Reviewer will study the product and supporting documents (including the

Quality Criteria included in the Product Description), and will complete a Quality

Review Error List.

♦ The QR Error List will, wherever possible, be sent to the Producer before the review.

Figure 129: Formal Quality Review Step 1

Product Description

Finished Product

Error Lists

Producer of the ProductReviewers of the Product


272

Step 2 - The Review Meeting

The objective of the Quality Review is to agree a list of queries, observations and errors

in the Product. The Chair and the Producer do not have to reconcile these errors at the

meeting - it is sufficient for the QR Chairman and Reviewers to agree that a particular area

needs re-examination. Provided that the point and follow-up action is logged, theReviewers have an opportunity to confirm that action has been taken, after the review

meeting.

The procedure for the PRINCE Quality Review step is:

♦ The Quality Review Chair opens the meeting and introduces those present if

necessary. The meeting Objectives and Timing (a maximum of 2 hours isrecommended) is announced.

♦ The Chair asks each Reviewer for comments. The purpose of this is to identify the

main areas for discussion that the review must focus upon. It also affords an

opportunity for an overall reaction to the total Product and to consider prematureclosure of the meeting if appropriate.

♦ The Producer then "Walks-through" the Product in detail. This may be

sentence-by-sentence or page-by-page and will be determined by the Reviewers' QRError Lists already sent to the Producer, and by their general comments made earlier.

♦ The QR Chair controls the discussion during the Walk-through ensuring that no

arguments or solutions are discussed (other than obvious and immediately acceptedsolutions!). Follow-up Actions are noted on the QR Follow-Up Action List by either

the Scribe or Project Support. No minutes need be taken of the review. Reviewers’

comments are always related to the Quality Criteria contained in the Product

Description - these are the measures used by all involved to determine theacceptability, or otherwise, of the Product under review.

♦ At the conclusion of the walk-through, the Chair summarises the Follow-up actions

and determines responsibility for sign-off of specific points if required. The initials ofthe Reviewer who will sign-off any specific point is recorded on the QR Follow-Up

Action Sheet.

♦ The Chair, after seeking the Reviewers' and Producers' opinions, will decide on the

outcome of the review. A QR Result Notification will be completed and a copy of theFollow-Up Action List attached. These forms will be sent to Project Support (or the

Project Manager) and/or Team Manager for the plans to be up-dated.

♦ The Reviewers' Error Lists, copies of the Product (typically containing the Reviewer'sannotations) and any other relevant documentation is collected by the Chair and

passed to the Producer to assist in the Follow-up.


273


Step 3 - Follow-up of Review Meeting

The objective of the Follow-up step is to ensure that all items identified on the QR

Follow-Up Action List are dealt with and signed off.

♦ The Producer takes the list away from the review and evaluates, discusses, andcorrects, if necessary, all the items on the list.

♦ When an error has been fixed, the Producer will obtain sign-off from whoever is

nominated on the QR Follow-Up Action List. This person may be the Reviewer whoraised the query initially, or may be another Reviewer, the Project Manager, Team

Manager, or the Quality Review Chair.

♦ When all errors have been reconciled and sign-off obtained, the Quality Review Chairwill raise a QR Review Result Notification confirming that the Product is "Complete"

and will attach the signed QR Follow-Up Action List. The documents will be sent to

Project Support (or the Project Manager or Team Manager) to up-date plans.

Error Lists

Chair-person

Follow-Up Actions

Sign-off

Quality Reviewed Product

Quality Review Meeting


274

Product Description

Finished Product

Error Lists

Producer of the ProductReviewers of the Product

Chair-person

Follow-Up Actions

Sign-off

Quality Reviewed Product

Quality Review Meeting


Summary of the Quality Review Technique

The Quality Review technique is a structured way of running a meeting to ensure that all

aspects are properly covered. It needs to be used with common-sense (to avoid thedangers of an over-bureaucratic approach) but with an intent to follow the procedures laid

down (to ensure nothing is missed).

If an organisation already uses existing effective standards for quality reviewing products,

it will not be necessary to change these to reflect the PRINCE 2 Quality Review

procedures. PRINCE 2 emphasises the need to ensure that all Products pass through a

quality control process (as laid down in the Product Description); this ensures that only"reviewed - correct - products" are regarded as being complete. The PRINCE 2 Manual

contains a fairly detailed step-by-step summary of the Quality Review Technique which

should be consulted and modified to suit the required procedure within the implementingorganisation.


275

Ken Bradley’s

Understanding PRINCE 2

Index

Chapter 22


277

Index

A

Acceptance Criteria · 155, 164, 202, 238Accepting A Work Package · 144, 217Accountability · 33, 36, 61, 74Activities · 77, 81, 82, 88, 89, 130Activity · 38, 77, 91Actuals · 29, 200, 204, 218, 249, 263Analysing Risks · 145, 255Appointing A Project Management Team ·

144Assembling A Project Initiation Document ·

144Assessing Progress · 144, 200, 204, 218Authorised Work Package · 91, 124, 125Authorising A Project · 108, 144, 184Authorising A Work Package · 144, 199, 209Authorising Initiation · 144, 154, 183

B

Baseline · 44, 96, 164Benefits · 25, 26, 44, 45, 58, 61, 88, 89, 96,

163, 224Benefits Statement · 88boundary · 27, 70, 71BS/EN/ISO9000 · 42, 60, 123, 269BS/EN/ISO9001 · 42, 123BS6079 · 42, 123Business Benefits · 29, 49, 50, 88, 108, 113,

135, 168, 227, 241, 262Business Case · 26, 45, 88, 89, 96Business Case · 60, 87, 88, 113, 154, 163,

223, 224, 262

C

CCTA · 2, 3, 17, 19, 20, 21, 53, 113, 253Change Controls · 52Checkpoint · 264Closing A Project · 29, 30, 31, 47, 102, 141,

144, 187, 189, 237, 242CMM · 52, 129, 130Communication · 25, 57, 67, 68, 69Completed Work Packages · 125Completing A Plan · 145, 256Components · 17Components · 28, 30, 31, 32, 54, 143, 247,

269Concurrent Engineering · 72, 73

Configuration · 26, 31, 40, 43, 52, 53, 65, 74,125, 129, 130, 131, 135, 136, 202, 218,265, 266

Configuration Librarian · 135Configuration Management · 40, 43, 52, 74,

129, 130Confirming Project Closure · 144, 155, 189Context Diagram · 145, 146Control · 17, 25, 26, 34, 39, 42, 43, 44, 45,

51, 57, 61, 62, 64, 72, 74, 77, 84, 89, 90,94, 96, 124, 129, 130, 135, 136, 137, 182,216, 224, 247, 248, 269, 270

Controlling A Stage · 29, 30, 31, 125, 141,144, 157, 197, 210, 212, 218, 249

Controls · 44, 50, 52, 94Critical Path · 19, 81Customer’s Quality Expectations · 165

D

decision points · 27, 181Decision-support · 224, 237Decommissioning A Project · 144, 155, 164,

239Defining Project Approach · 144Deliverables · 25, 26, 27, 36, 38, 39, 40, 47,

60, 102, 146, 223, 237, 238, 247, 248Delivering A Work Package · 144, 219Dependencies · 27, 247Designing A Plan · 145, 249Designing A Project Management Team · 144Directing A Project · 29, 30, 31, 58, 141,

144, 157, 177, 181, 191, 193

E

Earned Value · 86, 87, 90End-Stage Assessment · 43, 64Enhancement · 17, 19ESA · 45, 64, 96, 264Escalating Project Issues · 203Estimating · 38, 65, 249, 253, 254Estimating · 38, 145, 253Evaluating A Project · 144, 242Exception · 38, 182, 224, 263, 264Exception Plan · 44, 45, 98, 144, 182, 185,

186, 187, 208, 231Exception Report · 44, 45, 98, 186, 187, 203,

208, 231Executing A Work Package · 144, 218Executive · 30, 34, 59, 61, 71, 74, 89, 144,

152, 153, 156, 183


278

External Assurance · 36, 60, 61

F

Feasibility · 88Feasibility Study · 88Filing · 32, 53, 65, 129, 171, 172, 261, 266Follow-on Actions · 48, 102, 144, 238, 241Formal Quality Review · 51, 65, 271, 273,

274

G

Gantt · 40, 41, 42, 43, 77, 82, 83, 84, 90, 91,124, 262, 263

Giving Ad-Hoc Direction · 144, 188Government Departments · 17Graphical Summary · 85, 86, 87, 90, 256

H

Highlight Report · 62, 63, 68, 69, 182, 264Highlight Reports · 30, 48, 73, 102, 188Hints and Tips · 33, 146

I

Identifying Activities And Dependencies ·145, 252

Identifying, Defining And Analysing Products· 145, 250

Initiating A Project · 27, 29, 30, 31, 42, 44,47, 50, 96, 102, 108, 124, 125, 141, 157,158, 163, 164, 166, 173, 175, 176, 184

Internal Assurance · 36, 60, 61Issues · 52, 129, 136, 137, 198, 266Issues Log · 48, 102, 202, 203, 204

L

Lessons learned · 242Lessons Learned · 47, 102, 224, 238, 242,

262Lessons Learned Report · 47, 102, 262Levels of plan · 249Lifecycle · 18

M

Maintenance · 17management · 17, 19, 20, 25, 26, 27, 32, 33,

34, 35, 37, 38, 39, 42, 44, 45, 46, 47, 57,62, 64, 65, 67, 68, 69, 70, 72, 74, 81, 88,

94, 96, 99, 102, 113, 123, 130, 135, 141,145, 146, 176, 182, 197, 216, 264, 269

Management Products · 64, 65, 78Management Stage · 26, 29, 30, 38, 42, 45,

47, 48, 49, 50, 62, 80, 86, 89, 90, 98, 100,102, 104, 108, 109, 110, 124, 125, 141,155, 157, 163, 166, 167, 168, 174, 184,185, 186, 197, 198, 199, 200, 201, 203,204, 205, 208, 209, 217, 218, 220, 225,226, 227, 228, 229, 230, 231, 250, 251,252, 257, 263, 264

Management Stages · 26, 28, 30, 31, 32, 35,48, 49, 64, 103, 104, 107, 108, 109, 110,164, 169, 232

Managing Product Delivery · 29, 30, 31, 91,107, 125, 141, 157, 200, 215, 220

Managing Stage Boundaries · 29, 30, 31,108, 115, 141, 157, 166, 167, 168, 174,184, 186, 199, 223, 232, 233

Manuals · 59Mid Stage Assessment · 45, 98, 169, 186,

231, 264Milestone · 87, 251

O

Objectives · 44, 94, 237Off-Specification · 135, 136, 137, 202Operation · 18, 131Organisation · 26, 32, 33, 34, 35, 36, 37, 39,

44, 48, 51, 57, 58, 59, 60, 65, 67, 68, 69,70, 71, 72, 74, 76, 88, 96, 102, 114, 116,124, 125, 135, 141, 146, 165, 170, 181,197, 199, 200, 209, 217, 218, 224, 238,242, 247, 266, 269, 270, 271, 274

Organisation · 17, 20, 25, 33, 238, 261, 263Ownership · 58

P

PERT · 40, 81, 82, 90, 254, 262, 263PID · 44, 50, 96, 115, 155, 157, 163, 164,

173, 174, 177, 182, 183, 184Plan · 26, 38, 40, 41, 42, 43, 44, 61, 62, 71,

72, 76, 77, 83, 85, 87, 89, 90, 94, 182, 198,224, 238, 247

Plan Description · 87, 89, 90Plan Text · 89, 90, 248, 256Planning · 19, 20, 27, 30, 31, 35, 38, 39, 40,

41, 42, 43, 44, 50, 53, 62, 65, 72, 74, 76,77, 78, 83, 84, 88, 89, 94, 108, 109, 110,124, 125, 151, 153, 157, 164, 165, 166,200, 228, 247, 248, 249, 250, 255, 257,269

Planning · 17, 19, 25, 29, 30, 31, 32, 38, 40,41, 42, 43, 50, 76, 124, 141, 144, 145, 157,


279

165, 166, 174, 187, 225, 247, 250, 254,257, 258, 269

Planning A Project · 141Planning An Initiation Stage · 144Planning levels · 76Plans · 76, 77, 89, 91Post Project Review · 29, 30, 177, 189, 241,

242Preparing A Project Brief · 144PRINCE · 15, 17, 19, 20, 25, 26, 27, 28, 32,

33, 34, 36, 37, 38, 39, 40, 42, 44, 47, 51,52, 53, 54, 57, 58, 59, 60, 61, 63, 64, 65,67, 69, 71, 72, 74, 76, 77, 79, 89, 90, 91,94, 102, 113, 123, 129, 130, 135, 136, 137,141, 145, 146, 216, 247, 261, 269, 272,274

PRINCE 2 · 1, 14, 20, 21, 26, 27, 28, 29, 30,31, 32, 34, 36, 37, 38, 41, 42, 43, 47, 48,49, 50, 53, 54, 57, 58, 61, 64, 65, 66, 69,72, 74, 76, 77, 79, 84, 85, 86, 87, 91, 99,103, 107, 108, 109, 110, 123, 124, 129,137, 139, 141, 142, 143, 145, 146, 151,152, 153, 155, 158, 164, 165, 166, 168,169, 170, 171, 172, 173, 174, 177, 202,210, 220, 227, 228, 231, 232, 248, 249,253, 256, 257, 259, 261, 269, 274

PRINCE Environment · 20, 53Process Models · 145, 146Process-based · 33Processes · 26, 27, 57, 125, 130, 141, 157Processes · 26, 27, 28, 29, 30, 31, 32, 35, 44,

54, 65, 96, 141, 143, 144, 145, 146, 157,163, 166, 181, 188, 247, 269

Product Breakdown Structure · 40, 78, 80,90, 261, 263

Product Description · 32, 40, 42, 50, 51, 63,78, 79, 80, 124, 125, 165, 217, 250, 265,269, 271, 272, 274

Product Flow Diagram · 32, 40, 80, 81, 90,250, 252, 262, 263

Product Flow Diagrams · 249Products · 20, 26, 34, 35, 38, 40, 43, 49, 50,

52, 61, 62, 80, 125, 129, 131, 135, 186,274

Products · 25, 26, 27, 36, 38, 39, 40, 43, 47,52, 59, 60, 63, 64, 65, 72, 74, 77, 78, 80,81, 84, 86, 90, 91, 102, 124, 129, 130, 131,135, 146, 197, 215, 216, 223, 237, 238,247, 248, 262, 264. See Outputs

Programme · 57, 62, 69, 70, 71, 72, 81Programme of work · 48, 103Project Approach · 152, 156, 171Project Assurance · 35, 36, 60, 61, 64, 68,

70, 73, 74, 137, 225, 270Project Assurance Team · 270Project Board · 30, 31, 32, 33, 34, 35, 36, 37,

39, 41, 43, 44, 45, 46, 47, 48, 50, 58, 59,

60, 61, 62, 63, 64, 65, 67, 68, 70, 71, 72,73, 74, 82, 83, 84, 85, 86, 87, 89, 90, 94,96, 98, 99, 100, 102, 103, 107, 108, 110,113, 114, 124, 131, 136, 141, 144, 146,151, 152, 153, 154, 156, 157, 164, 166,167, 168, 169, 171, 174, 175, 176, 177,181, 182, 183, 184, 185, 186, 187, 188,189, 190, 197, 198, 199, 200, 201, 203,204, 205, 206, 207, 208, 216, 217, 223,224, 225, 226, 227, 228, 229, 230, 231,237, 238, 240, 242, 243, 249, 250, 254,256, 264, 270

Project Brief · 31, 124, 152, 154, 155, 156,165, 168, 171

Project Closure · 47, 102, 181, 182Project Files · 64Project Initiation · 19, 43, 44, 53, 61, 87, 94,

96, 113, 163, 164, 182, 237, 238, 248, 262,270

Project Issue Report · 129, 135, 136Project issues · 239, 266Project Issues · 32, 48, 102, 129, 135, 136,

137, 144, 200, 202, 203, 208, 241Project Management Team · 29, 30, 58, 74,

78, 151, 152, 153, 166, 171, 174, 175, 198,202, 207, 225, 228, 230, 250, 254

Project Manager · 19, 29, 30, 32, 35, 36, 37,39, 43, 45, 47, 48, 49, 50, 52, 53, 61, 62,63, 64, 68, 69, 70, 71, 72, 73, 74, 78, 83,87, 88, 91, 98, 100, 102, 104, 107, 109,110, 113, 117, 124, 125, 131, 135, 136,141, 144, 146, 152, 153, 166, 169, 170,174, 181, 182, 184, 186, 188, 190, 197,198, 199, 200, 201, 203, 204, 207, 208,210, 215, 216, 217, 218, 224, 225, 226,230, 231, 240, 242, 250, 252, 256, 270,272, 273

Project Mandate · 88, 151Project plans · 26, 71, 85Project Support · 36, 37, 53, 60, 61, 63, 64,

65, 69, 71, 72, 74, 131, 135, 137, 270, 272,273

PROMPT · 17, 18, 19, 20Public Domain · 25

Q

QMS · See Quality Management SystemQuality · 17, 19, 26, 36, 38, 40, 42, 50, 51,

60, 61, 63, 65, 70, 73, 78, 79, 87, 90, 102,125, 135, 197, 215, 216, 223, 237, 261,263, 265, 266, 269, 270, 271, 272, 274

Quality assurance · 17, 274Quality criteria · 35, 43, 50, 51Quality Criteria · 31, 32, 51, 124, 125, 165,

217, 230, 269, 270


280

Quality Management · 19, 26, 42, 50, 73,119, 120, 123, 124, 125, 165, 242, 269,270, 271

Quality Management System · 42, 73, 125,269, 270, 271

Quality Review Technique · 32, 124, 269,274

Quality Reviews · 90, 266, 270

R

Rapid Application Development · 72, 73Receiving A Completed Work Package · 144,

209Refining The Business Case and Risks · 144Reporting Highlights · 144, 205Reporting Stage End · 144, 229Request for Change · 135, 136, 137Request For Change · 136, 202Resource · 17, 82, 83, 84, 85, 90Resource Plan · 40, 42, 84, 85, 90, 254Resources · 82, 83Resources Report · 41, 42, 85, 263responsibilities · 26, 33, 36, 58, 62, 63, 64Review · 136, 271, 272, 273Reviewing Stage Status · 144, 200, 204, 205,

207Risk · 31, 36, 41, 43, 62, 69, 72, 87, 88, 89,

110, 113, 114, 115, 117, 163, 168, 169,183, 206, 223, 228, 231, 249, 255

Risk Assessment · 65, 87, 88, 113, 115, 262Risk Factor · 115, 117, 120Risks · 26, 27, 44, 45, 83, 87, 89, 90, 96, 113,

163, 224Risks · 29, 49, 50, 60, 168, 248, 255Role descriptions · 58Roles · 33, 34, 36, 58, 59, 61

S

Scheduling · 145, 254Scoping Diagram · 27Senior User · 59, 71, 136Setting Up Project Controls · 144, 169Setting Up Project Files · 144Significant deviation · 45, 98, 186Smaller projects · 59Software · 20, 65, 72, 76, 77, 83, 84, 90, 247Software support tool · 41, 78, 254Software tools · 249specialist · 25, 33, 34, 35, 36, 38, 39, 58, 59,

62, 64, 65, 67, 69, 90, 91, 109, 130, 135,216, 270

Specialist Stages · 64

SPOCE · 113Stage · 18, 26, 27, 36, 38, 39, 40, 42, 43, 44,

45, 46, 47, 50, 61, 62, 63, 77, 84, 85, 86,89, 90, 96, 99, 102, 125, 137, 164, 223,224, 264

Stage Manager · 83, 136Stages · 18, 26, 27, 33, 64, 72, 89, 181, 224,

247Stages · 18, 31, 35, 48, 49, 64, 103, 104, 107,

109, 223, 230Starting A Project · 44, 96, 141, 151Starting Up A Project (SU) · 124Strategic Planning · 17Supplier · 34, 57, 58, 59, 65, 67, 69, 71, 215,

216System Development · 17

T

Taking Corrective Action · 144, 205, 207Team Leader · 36Team Manager · 35, 36, 62, 63, 64, 69, 72,

74, 78, 83, 136Team Managers · 35, 61, 62, 64, 72, 74Team Plan · 91, 252Teams · 36, 37Technical · 18, 31, 35, 47, 48, 49, 61, 64, 84,

90, 99, 103, 104, 107, 109, 130, 271Techniques · 26, 33, 38, 39, 57, 65, 113, 125,

129, 143, 247, 253, 254, 269, 270Techniques · 28, 32, 38, 51, 54, 129, 143,

145, 247Terms of Reference · 44, 94, 154Tolerance · 30, 43, 46, 47, 99, 100, 169, 182,

186, 198, 203, 204, 207, 208, 224, 231Transformation · 252

U

UK Government · 17, 20Updating A Project Business Case · 144, 227Updating A Project Plan · 144, 226Updating The Risk Log · 144, 227, 228User · 20, 34, 89, 135, 137User/Customer Group · 71

W

Walk-through · 51, 272Work Package · 263Work Packages · 109, 125, 197, 199, 209,

218

Date post:	13-Jan-2015
Category:	Business
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