PMP Flashcards 3 Flashcards

Terms Definitions
Refinements
Updates to the WBS.
Mode
The most frequently occurring observation in the data set under consideration.
Risk responses
Avoidance, mitigation, transference, and acceptance.
administrative closure
Generating, gathering, and disseminating information to formalize phase or project completion.
Double-declining balance
Double-declining balance is considered accelerated depreciation. This method allows the organization to double the percentage written off in the first year. In our above example, a single deduction was $1000 per year, which is twenty percent of the total deduction across the five years. With double-declining, the customer would subtract 40 percent the first year, and then 40 percent of the remaining value each subsequent year. In our example, the deducted amount for year one would be $2000. For year two it’d be $1200, and year three it would be $720. This is a great method for equipment that you don’t anticipate to have around for a very long time—such as computer equipment.
administrative closure
Generating, gathering, and disseminating information to formalize phase or project completion.
Privity
The contractual relationship between the buyer and the seller is often considered confidential and secret.
Source selection
Choosing from among potential sellers.
Compromising
A conflict resolution method; this approach requires both parties to give up something. The decision ultimately made is a blend of both sides of the argument. Because neither party completely wins, it is considered a lose-lose solution.
Scope planning
The process of progressively elaborating the work of the project, which includes developing a scope statement that includes the project justification, the major deliverables, and the project objectives.
Human resources constraints
Includes organization structure, collective bargaining agreements, project management preferences, staffing, and procurements. When a labor union or other group is a constraint, it is also considered a stakeholder.
Duration compression
Shortening the project schedule without reducing the project scope. Often increases costs.
Variance
The difference between what was planned and what was experienced; typically used for costs and schedules.
Responsibility
Who decides what in a project.
Laplace criterion
An attempt to transform decision-making under uncertainty into decision-making under risk.
Contract
A contract is a mutually binding agreement that obligates the seller to provide the specified product and obligates the buyer to pay for it. Three types: fixed-price (lump-sum), cost-reimbursable, or time and materials. Contracts are backed through the court system. A contract must contain an offer, have been accepted, provide for a consideration (payment), and be for a legal purpose
Direct costs
Costs incurred directly by the project. Examples include equipment needed to complete the project work, salaries of the project team, and other expenses tied directly to the project’s existence.
quantitative risk analysis
Measuring the probability and consequences of risks and estimating their implications for project objectives. This process uses techniques simulation and decision tree analysis.
Technical interfaces
The technical interfaces describe the relationship between the project and the technical disciplines’ input to the project. Consider a project to create a new building. The technical interfaces would include architects, mechanical engineers, structural engineers, and others.
Resource histogram
A bar chart reflecting when individual employees, groups, or communities are involved in a project. Often used by management to see when employees are most or least active in a project.
Discretionary dependencies
The preferred order of activities. Also called soft logic, preferred logic, or preferential logic.
receiver
Part of the communications model: the recipient of the message.
Product scope
The features and functions that characterize and product or service.
Work Breakdown Structure
A deliverable-oriented grouping of project elements that organizes and defines the total work scope of the project. Each descending level represents an increasingly detailed definition of the project work. Serves as the project scope baseline. Used as input to the following core processes: cost estimating, cost budgeting, resource planning, risk management planning, and activity definition.
paralingual
The pitch, tone, and inflections in the sender’s voice affect the message being sent.
Activity
An element of work performed during the course of a project. An activity normally has an expected duration, and expected cost, and expected resource requirements. Can be subdivided into tasks. Formerly called a work item.
Alternatives identification
Any process that identifies other solutions to an identified problem. These approaches typically use brainstorming and lateral thinking. In this process, alternatives-identification may include buy-versus-build scenarios, outsourcing, cross training, and other activities.
Slack
Term used in arrow diagramming method for float.
Quality management
There are several quality management philosophies: Kaizen, Total Quality Management, and Marginal Analysis.
medium
Part of the communications model; this is the path the message takes from the sender to the receiver. This is the modality in which the communication travels typically refers to an electronic model, such as e-mail or the telephone.
Withdrawal
A conflict resolution method that is used when the issue is not important or the project manager is out-ranked. The project manager pushes the issue aside for later resolution. It can also be used as a method for cooling down. The conflict is not resolved, and it is considered a yield-lose solution.
receiver
Part of the communications model: the recipient of the message.
Collective bargaining agreements
These are contractual agreements initiated by employee groups, unions, or other labor organizations; they may act as a constraint on the project.
Murder boards
Committee designed to expose strengths and weaknesses of projects
Scope statement
The scope statement provides a documented basis for making future project decisions and for confirming or developing a common understanding of project scope among stakeholders. As the project progresses, the scope statement may need to be revised or refined to reflect approved changes to the scope of the project. The scope statement provides justification for the project existence, lists the high-level deliverables, and quantifies the project objectives. Includes project justification, project’s product, project deliverables, and project objectives.
Crashing
Taking action to decrease the total project duration after analyzing a number of alternatives to determine how to get the maximum duration compression for the least costs. Usually, adds more resources to activities on the critical path to complete the project earlier (this adds to expense).
Median
The value having as many observations above it as there are below it. If an even number of observations is collected, then the median is the mean of the two observations in the middle.
risk database
A repository that provides for collection, maintenance, and analysis of data gathered and used in the risk management processes. A lessons learned program uses a risk database. This is an output of risk monitoring and control process.
transference
Risk transference is seeking to shift the impact of a risk to a third party together with ownership of the response.
Decentralized contracting
Assigns a contract administrator or contract officer to the project rather than going through a centralized contract system.
Contract closeout
Completion and settlement of the contract, including resolution of any open items.
Single sampling
This is the acceptance or rejection of a lot based upon one sampling run.
qualitative risk analysis
An examination and prioritization of the risks based on their probability of occurring and the impact on the project if they do occur. Qualitative risk analysis guides the risk reaction process.
Proposal
A document from the seller to the buyer, responding to a Request for Proposal or other procurement documents.
Procurement audits
The successes and failures within the procurement process are reviewed from procurement planning through contract administration. The intent of the audit is to learn from what worked and what did not work during the procurement processes.
Single source
A specific seller that the performing organization prefers to contract with.
Acceptance sampling
A statistical process if evaluating a portion of a lot for the purpose of accepting or rejecting the entire lot.
Quality management plan
This document describes how the project manager and the project team will fulfill the quality policy. In an ISO 9000 environment, the Quality Management Plan is referred to as the “project quality system.” Addresses three things about the project and project work: quality control, quality assurance, and quality improvement.
Variable sampling
Measures conformance to quality as a whole
Communications matrix
A communications matrix can help the project manager organize communication needs by identifying who needs what information and when. A communications matrix identifies all of the stakeholders and shows where communication originates and to whom it is intended.
Problem solving
The ability to determine the best solution for a problem in a quick and efficient manner. Also called confronting. Win-win.
Conditional diagramming methods
Include system dynamics and the graphical evaluation and review technique (GERT). These models allow for loops and conditional branching. For example, GERT may require that tests of the product be performed several times before the project may continue. Based on the outcome of the testing, the project may use one of several paths to enable its completion. System dynamics is another example of conditional advancement.
Scope
The sum of the products and services to be provided as a project. Also see project scope and product scope.
Sources of conflict
Sources of team disagreement from most to least common: Schedules, Priorities, Resources, Technical beliefs, Administrative policies and procedures, Project costs, and Personalities.
Direct costs
Costs that attributed directly to the project and cannot be shared with operations or other projects.
Hanger
An unintended break in a network path. Hangers are usually caused by missing activities or missing logical relationships.
Staffing management plan
This subsidiary plan documents how project team members will be brought onto the project and excused from the project.
Control charts
These illustrate the performance of a project over time. They map the results of inspections against a chart. Control charts are typically used in projects or operations that have repetitive activities such as manufacturing, test series, or help desk functions. Upper and lower control limits indicate if values are within control or out of control. +/– 1 sigma 68.26 percent +/- 2 sigma 95.46 percent, +/- 3 sigma 99.73 +/- 6 sigma 99.99 percent. The mean in a control chart represents the expected result, while the sigma values represent the expected spread of results based on the inspection. A true six sigma allows only two defects per million opportunities and the percentage to represent that value is 99.99985%.
Fixed costs
Costs that remain the same throughout the project.
Mean
The mean in a control chart represents the expected result.
decoder
This is a part of the communications model; it is the inverse of the encoder. If a message is encoded, a decoder translates it back to usable format.
Conditional diagramming methods
Include system dynamics and the graphical evaluation and review technique (GERT). These models allow for loops and conditional branching. For example, GERT may require that tests of the product be performed several times before the project may continue. Based on the outcome of the testing, the project may use one of several paths to enable its completion. System dynamics is another example of conditional advancement.
Corrective action
Any method applied to bring the project schedule back into alignment with the original dates and goals for the project end date. Includes: extraordinary measures to ensure work packages complete as scheduled and with as little delay as possible, root-cause analysis of schedule variances, and implementing measures to recover from schedule delays.
Project calendar
This calendar shows when work is allowed on the project.
Sole source
The only qualified seller that exists in the marketplace.
Procurement audits
The successes and failures within the procurement process are reviewed from procurement planning through contract administration. The intent of the audit is to learn from what worked and what did not work during the procurement processes.
Hurwicz criterion
In risk management, often referred to as the maximax criterion. The decision-maker is always optimistic and attempts to maximize profits in a go-for-broke strategy.
Savage criterion
In risk management, often referred to as the minimax criterion. Minimize the maximum regret.
Contract file
A complete indexed set of records of the procurement process incorporated into the administrative closure process. These records include financial information as well as information on the performance and acceptance of the procured work.
Project slack
This is the total time the project can be delayed without passing the customer-expected completion date.
Code of accounts
Any numbering system used to uniquely identify each element of the work breakdown structure.
Earned value management (EVM)
A method for integrating scope, schedule, and resources, and for measuring project performance. It compares the amount of work that was planned with what was actually earned with what was actually spent to determine if cost and schedule performance are as planned.
Chart of accounts
Any numbering system used to monitor project costs by category. The project chart of accounts is usually based on the corporate chart of accounts. Not the same as code of accounts.
Discounted cash flow
Accounts for the time value of money.
Sunk costs
Monies that have been spent on a project are called sunk costs. In evaluating whether a project should continue or not, the sunk costs should not be considered—they are gone forever.
Expert power
A type of power where the authority of the project manager comes from experience with the area that the project focuses on.
Parkinson’s Law
States: “Work expands so as to fill the time available for its completion.”
WBS template
A master WBS that is used in organizations as a starting point in defining the work for a particular project. This approach is recommended, as most projects in an organization are similar in the project lifecycles and the approach can be adapted to fit a given project.
Benefit/cost ratios (BCRs)
Examines the benefit to cost ratio such as 3:2.
Actual costs (AC)
Total costs incurred that must relate to whatever cost was budgeted within the planned value and earned value in accomplishing work during a given time period. Formerly known as Actual Cost of Work Performed (ACWP).
War room
A centralized office or locale for the project manager and the project team to work on the project. It can house information on the project, including documentation and support materials. It allows the project team to work in close proximity.
Expectancy Theory
People will behave on the basis of what they expect as a result of their behavior. In other words, people will work in relation to the expected reward of the work.
Make-or-buy analysis
Used in determining what part of the project scope to make and what part to purchase.
sensitivity analysis
This examines each project risk on its own merit to assess the impact on the project. All other risks in the project are set at a baseline value.
Invitation for Bid (IFB)
Generally, this term is equivalent to request for proposal. However, in some application areas, it may have a narrower or more specific meaning.
Estimate at Completion (EAC)
The expected total cost of an activity, a group of activities, or the project when the defined scope of work has been completed. Most techniques for forecasting EAC include some adjustment of the original cost estimate, based on actual project performance to date. EAC=BAC/CPI. Also called Forecast Final Cost.
Responsibility assignment matrix (RAM)
A structure that relates the project organization structure to the work breakdown structure to help ensure that each element of the project scope of work is assigned to a responsible individual.
Cost Performance Index (CPI)
The cost efficiency ratio of earned value to actual costs. Used to predict magnitude of a cost overrun. CPI = EV/AC (BAC/CPI = projected cost at completion).
Start No Earlier Than (SNET)
This constraint requires that the project or activity not start earlier than the predetermined date. A common constraint.
Early finish (EF)
The earliest possible point in time on which the uncompleted portions or an activity can finish. The EF for the first task is its ES, plus the task duration, minus one.
Request for Quotation (RFQ)
Generally, this term is equivalent to RFP. In some application areas, it may have a narrower or more specific meaning.
Invitation for Bid (IFB)
Generally, this term is equivalent to request for proposal. However, in some application areas, it may have a narrower or more specific meaning.
Request for Proposal (RFP)
A type of bid document used to solicit proposals from prospective sellers of products or services. In some application areas, it may have a narrower or more specific meaning.
Chart of account
This is a coding system used by the performing organization’s accounting system to account for the project work.
Activity description (AD)
A short phrase or label used in a project network diagram. The activity description normally describes the scope of work of the activity.
Critical Path Method (CPM)
This is the most common approach to calculating when a project may finish. It uses a “forward” and “backward” pass to reveal which activities are considered critical. Activities on the critical path may not be delayed; otherwise, the project end date will be delayed. The critical path is the path with the longest duration to completion. Activities not on the critical path have some float (also called slack) that allows some amount of delay without delaying the project end date. The following illustration is an example of the critical path.
Budget at Completion (BAC)
The sum of the total budgets for a project. The predicted budget for the project; what
scales of probability and impact
Each risk is assessed according to its likelihood and its impact. There are two approaches to ranking risks: Cardinal scales identify the probability and impact by a numerical value, ranging from .01 as very low to 1.0 as certain. Ordinal scales identify and rank the risks descriptively as very high to very unlikely.
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