Chapter 5: Project Scope Management

What is Project Scope Management?

 Scope: Think of it as a big list of everything the project has to do. It
includes the tasks, the work, and all the processes needed to make
the final product.

 Project Scope Management is about making sure everything on the

list is clear, nothing extra is added, and everything gets done
properly.

Project Scope Management Processes:

These are the steps you follow to manage the project scope:

1. Planning Scope: Deciding how to handle the scope.

2. Collecting Requirements: Figuring out what needs to be done.

3. Defining Scope: Writing down exactly what the project will deliver.

4. Creating the WBS (Work Breakdown Structure): Breaking the

work into smaller, manageable pieces.

5. Validating Scope: Making sure everything is done as planned.

6. Controlling Scope: Keeping the project on track and avoiding

unnecessary changes.

P1: Planning Scope Management

 The team uses their knowledge and holds meetings to decide how
to manage the project’s scope.

 They create a Scope Management Plan, which is part of the

bigger Project Management Plan.

 What’s in the Scope Management Plan?

1. How to write a detailed list of what the project will do (called

the project scope statement).

2. How to create and update the Work Breakdown Structure

(WBS).

3. Steps to get official approval for the finished work.

4. Rules for handling changes to the project’s scope.

P1: Requirements Management Plan

  This plan explains what the project or product must do to meet
agreements or requirements.

 It’s like a checklist for all the things the project needs to satisfy.

P2: Collecting Requirements

 This step is about gathering information on what the project should
deliver.

 Four Parts of Requirement Development:

1. Elicitation: Asking questions and collecting ideas.

2. Analysis: Sorting and understanding the collected ideas.

3. Specification: Writing down the details clearly.

4. Validation: Checking if everything makes sense and meets

the goal.

Methods for Collecting Requirements:

1. Interviewing: Talking to people to get their input.

2. Prototyping: Making a sample or model to understand what’s

needed.

3. Benchmarking: Comparing with similar projects to set standards.

Interesting Stats About Software Project Requirements:

 88% of software projects improve old products instead of making
new ones.

 86% of teams say customer satisfaction is the top measure of

success.

 83% of teams still use tools like Word and Excel to handle
requirements.

Tips to Manage Changing Requirements:

1. Assume that the first requirements might not be perfect.

2. Be ready for requirements to change.

3. Keep the change management process simple.

P2: Requirements Traceability Matrix (RTM)

 What is it?

o A table that helps track all the project’s requirements.

 o It lists each requirement, its details, and its status so nothing
is missed.

P3: Defining Scope

 In this step, you write down everything the project will deliver.

 Key Elements of a Project Scope Statement:

1. A description of the product.

2. Criteria for how the product will be accepted by users.

3. Details on all deliverables (the things the project will produce).

Refining Project Scope:

 As the project moves along, you might need to adjust and clarify the
scope to make sure it’s achievable and still meets the goals.

P4: Creating the Work Breakdown Structure (WBS)

 What is a WBS?

o A deliverable-oriented breakdown of all the work in the

project.

o It defines the total scope of the project and organizes it into

smaller, manageable parts.

 Key Principles of WBS:

o Follow the 100% Rule: Include 100% of the work defined in

the project scope.

o Capture all deliverables, whether internal, external, or interim.

 Sample WBS Structures:

1. Organized by product.

2. Organized by project phase.

 Approaches to Developing a WBS:

o Guidelines: Using predefined standards (e.g., from

organizations like the DoD).

o Analogy: Comparing with similar projects.

o Top-Down: Starting with the big picture and breaking it down.

o Bottom-Up: Building from smaller tasks to create the larger

structure.
 o Mind-Mapping: Using a visual brainstorming tool to create
the WBS.

WBS Dictionary:

 Purpose: To explain vague tasks in detail so team members know

exactly what to do, how long it will take, and what it will cost.

 Tips for Creating a WBS Dictionary:

o Each task should appear only once.

o Clearly define the work content of each item.

o Assign responsibility for each task to one individual (even if

others assist).

P5: Validating Scope

 What is Scope Validation?

o The formal acceptance of the project’s deliverables.

o Often involves customer inspection and sign-off.

P6: Controlling Scope

 What is Scope Control?

o Managing changes to the project scope.

o Ensures that changes are reviewed and approved properly.

Goals of Scope Control:

1. Influence factors causing scope changes.

2. Process changes according to approved procedures.

3. Manage changes when they occur.

Common Problems:

 Scope Creep: When extra work is added without proper approval.

o Causes of Scope Creep:

1. Poor change control.

2. Weak project management or sponsors.

3. Incomplete or unclear requirements.

o Solutions:

 Define “must-haves” and “nice-to-haves.”

  Set clear expectations and document everything.

 Regularly review and manage business requirements.

Best Practices for Avoiding Scope Problems

1. Keep the scope realistic and achievable.

2. Involve users in the project scope management process.

3. Use standard tools and methods when possible.

4. Follow good project management processes consistently.

Improving User Input

1. Have users on the project team in key roles.

2. Hold regular meetings with clear agendas.

3. Deliver regular updates to users and sponsors.

4. Co-locate users with developers when possible.

Reducing Incomplete and Changing Requirements

1. Use a proper requirements management process.

2. Document and maintain requirements thoroughly.

3. Test requirements throughout the project lifecycle.

4. Review changes from a systems perspective.

Using Software to Assist in Project Scope Management

 Word-Processing Software: For scope-related documents.

 Spreadsheets: For financial calculations and charts.

 Communication Tools: For clarifying and sharing scope

information.

 Project Management Software: For creating WBS and managing

tasks.

 Specialized Software: For advanced project scope management.

Chapter Summary

 Project Scope Management involves defining, collecting, validating,

and controlling project scope.

 The main processes are:

1. Planning scope management.

 2. Collecting requirements.

3. Defining scope (scope statement).

4. Creating the WBS.

5. Validating scope.

6. Controlling scope.

Sample Questions
Multiple Choice Questions (MCQs):
1. What does the Scope Management Plan include?

a. Project budget details

b. Steps for creating the WBS
c. Team member roles
d. Risk management steps
Answer: b

2. Which is NOT a method for collecting requirements?

a. Interviewing
b. Prototyping
c. Brainstorming
d. Benchmarking
Answer: c

3. What is the purpose of a Requirements Traceability Matrix

(RTM)?

a. To track project costs

b. To list requirements and their statuses
c. To validate team member roles
d. To document change requests
Answer: b

4. What is the purpose of a Work Breakdown Structure (WBS)?

a. To define the project budget

b. To list the project’s risks
c. To break down the work into manageable sections
d. To organize team member roles
Answer: c

5. Which approach is NOT used to develop a WBS?

 a. Top-down
b. Bottom-up
c. Sideways
d. Mind-mapping
Answer: c

6. What is the 100% Rule in WBS creation?

a. Every team member must complete 100% of their tasks

b. The WBS should capture 100% of the project scope
c. The WBS should cover 100% of the budget
d. The WBS should have 100 items
Answer: b

7. What does scope validation ensure?

a. The project is within budget

b. The deliverables are formally accepted
c. The schedule is met
d. The team is satisfied
Answer: b

Written Questions and Answers:

1. Explain the importance of the Scope Management Plan in a

project.

o The Scope Management Plan is essential because it ensures

the project team and stakeholders clearly understand what
the project will and will not deliver. It provides a roadmap for
preparing the scope statement, creating the WBS, and
handling changes, which helps avoid confusion, scope creep
(when additional tasks are added without approval), and
delays.

2. List and explain the four parts of requirement development.

o Elicitation: This is the process of collecting ideas and

requirements by asking stakeholders questions, conducting
interviews, or brainstorming sessions.

o Analysis: After collecting ideas, the team organizes and

prioritizes them to understand what is feasible and essential
for the project.

o Specification: Writing down all the requirements in a detailed

and clear format so everyone knows what is expected.
 o Validation: Ensuring that the requirements are accurate,
complete, and meet the project’s objectives before moving
forward.

3. What is the role of a Requirements Traceability Matrix, and

why is it important?

o The Requirements Traceability Matrix (RTM) is used to track all

project requirements throughout the lifecycle of the project. It
ensures that every requirement is accounted for,
implemented, and tested. It is crucial because it helps avoid
missing any requirements, especially in complex projects, and
keeps everyone aligned on what needs to be delivered.

4. Describe the key elements of a project scope statement.

o The key elements are:

 Product Scope Description: A detailed explanation of

what the project will deliver, including its features and
functionalities.

 Acceptance Criteria: The conditions that must be met

for the product to be accepted by users or stakeholders.

 Deliverables: A list of tangible outputs the project will

produce, such as reports, software, or physical products.

5. What are the main goals of scope control?

o The goals of scope control are:

1. To influence factors that may cause scope changes.

2. To process changes according to the approved

procedures.

3. To manage changes effectively when they occur.

6. Explain the key principles of creating a WBS.

o A WBS should:

 Follow the 100% Rule, including all work defined in the

project scope.

 Clearly organize work into smaller, manageable

sections.

 Ensure that no task or deliverable is overlooked.

7. How can scope creep be avoided?

 o Scope creep can be avoided by:

 Defining requirements clearly as “must-haves” and

“nice-to-haves.”

 Setting realistic project expectations.

 Regularly reviewing and documenting business

requirements.

 Following proper change management processes.

8. What is the purpose of a WBS dictionary?

o The WBS dictionary provides detailed explanations of tasks

listed in the WBS, including:

 What needs to be done.

 Estimated time and cost.

 Who is responsible for each task.

 Any special instructions or requirements.

Chapter 6: Project Time Management

Importance of Project Schedules

 Delivering projects on time is one of the biggest challenges for

managers.

 Schedule issues are often the main reason for conflicts, especially in
the later stages of a project.

Project Time Management Processes

1. Plan Schedule Management: Decide how to manage the project

schedule.

2. Define Activities: Identify the specific tasks to be completed.

3. Sequence Activities: Determine the order of tasks based on

dependencies.

4. Estimate Activity Resources: Identify resources required for each

task.

5. Estimate Activity Durations: Calculate the time each task will

take.

6. Develop Schedule: Create a realistic project timeline.

7. Control Schedule: Monitor and manage changes to the schedule.

P1: Defining Activities

 Activity or Task: A work element in the WBS with a duration, cost,

and resource requirements.

 Activity List: A table of all tasks to be included in the project

schedule.

o Includes Activity Attributes (details about tasks).

o Includes Milestones, which are significant events with no

duration (e.g., obtaining sign-off).
P2: Sequencing Activities

 Dependencies: Logical relationships between tasks that determine

their order.

o Mandatory Dependency (Hard Logic): Task A must finish

before Task B starts.

o Discretionary Dependency (Soft Logic): Preferred order

defined by the team.

o External Dependency: Outside factors influencing task order

(e.g., waiting for government approval).

o Internal Dependency: Relationship between project

activities (e.g., testing follows design).

 Network Diagrams:

o Activity-on-Arrow (AOA): Tasks are represented by arrows;

only finish-to-start relationships are shown.

o Precedence Diagramming Method (PDM): Tasks are

represented by boxes, allowing different types of relationships:

 Finish-to-Start (FS): A finishes before B starts.

 Start-to-Start (SS): A and B start simultaneously.

 Finish-to-Finish (FF): A and B finish simultaneously.

 Start-to-Finish (SF): A starts before B finishes.

P3: Estimating Activity Resources

 Resource Breakdown Structure (RBS): A hierarchical list of

required resources categorized by type.

 Questions to Consider:

o How difficult are the tasks?

o What resources are available?

o What is the organization's experience with similar tasks?

P4: Estimating Activity Durations

 Duration vs. Effort:

o Duration: Total time to complete a task.

o Effort: Actual hours spent on the task.

  Three-Point Estimate:

o Optimistic (O): Best-case scenario.

o Most Likely (M): Expected scenario.

o Pessimistic (P): Worst-case scenario.

o Formulas:

 Triangular Distribution:

 Beta (PERT):

P5: Developing the Schedule

 Goal: Create a realistic schedule to monitor progress.

 Gantt Charts:

o Visual representation of tasks, start/end dates, and

dependencies.

o Symbols:

 Black diamond: Milestones.

 Thick black bars: Summary tasks.

 Horizontal bars: Task durations.

 Arrows: Dependencies.

o Milestones should follow SMART criteria:

 Specific, Measurable, Achievable, Relevant, Time-bound.

 Critical Path Method (CPM):

o Identifies the longest sequence of tasks.

o Determines the earliest project completion time.

o Float: Slack time available for a task without delaying the

project.

P6: Controlling the Schedule

 Goals:

o Understand schedule status.

o Influence factors causing schedule changes.

o Manage schedule changes effectively.

  Techniques:

o Crashing: Adding resources to reduce task durations.

o Fast-Tracking: Overlapping tasks that were planned to be

sequential.

 Using Software:

o Project management software for scheduling and dependency

tracking.

o Communication tools for sharing schedule updates.

Summary

 Project Time Management ensures tasks are planned, sequenced,

and monitored effectively.

 Includes planning, defining activities, sequencing, resource and

duration estimating, schedule development, and control.

Sample Questions and Answers

Multiple Choice Questions (MCQs):

1. What is a milestone in project management? a. A task with a

duration of one week.
b. A significant event with no duration.
c. A summary of tasks completed.
d. A dependency between tasks.
Answer: b

Explanation: A milestone marks a major achievement or phase in a

project. It is used to monitor progress but has no duration itself.

2. What does a critical path indicate? a. Tasks with the most

resources assigned.
b. The shortest path to complete the project.
c. The longest sequence of dependent tasks.
d. Tasks with no slack.
Answer: c

Explanation: The critical path is the sequence of tasks that directly

impacts the project’s end date. Delays on the critical path will delay the
entire project.

3. Which formula is used for a Beta (PERT) estimate? a.

b.
 c.
d.
Answer: b

Explanation: The Beta (PERT) formula gives more weight to the most
likely estimate, providing a more realistic duration estimate for tasks.

Written Questions and Answers:

1. What are the main types of task dependencies in sequencing

activities?

o Mandatory Dependency (Hard Logic): Tasks that must

occur in a specific order, such as building walls before painting
them.

o Discretionary Dependency (Soft Logic): Tasks that can be

reordered based on team preferences, such as writing
documentation before testing.

o External Dependency: Tasks dependent on external events,

like waiting for permits or supplier deliveries.

o Internal Dependency: Relationships between tasks within

the project, like completing design work before development.

2. Explain the difference between crashing and fast-tracking in

schedule management.

o Crashing: This technique reduces task durations by adding

resources, such as hiring more workers or using overtime. It
increases project costs but shortens timelines.

o Fast-Tracking: This method overlaps tasks that are usually

sequential, such as starting development before completing
the design. It saves time but increases risk since tasks may
need rework.

3. What is the purpose of a Gantt chart?

o A Gantt chart visually represents the project schedule by:

 Showing start and end dates of tasks.

 Highlighting dependencies between tasks with arrows.

 Indicating milestones with symbols like diamonds.

 Providing a clear, time-based view for monitoring project

progress and identifying delays.
Chapter 7: Project Cost Management

Importance of Project Cost Management

 Many IT projects fail to meet budget goals.

 Key statistic: A 2011 Harvard Business Review study found an

average cost overrun of 27%.

 Examples of poor cost management include government and

healthcare IT projects, such as the U.S. IRS and the UK National
Health Service.

What is Cost and Project Cost Management?

 Cost: Resources sacrificed to achieve an objective or something

exchanged for value.

 Project Cost Management: Processes to ensure the project is

completed within an approved budget.

Project Cost Management Processes

1. Planning Cost Management: Deciding how to manage project

costs.

2. Estimating Costs: Forecasting costs for all project activities.

 3. Determining Budget: Allocating the cost estimate to tasks over
time.

4. Controlling Costs: Monitoring and managing changes to the cost

baseline.

Basic Principles of Cost Management

 Life Cycle Costing: Total cost over the product lifecycle, including
development, operation, and disposal.

 Cash Flow Analysis: Estimating annual costs and benefits for

projects.

 Terminology:

o Tangible Costs/Benefits: Easily measured (e.g., hardware

costs).

o Intangible Costs/Benefits: Hard to measure (e.g., customer

satisfaction).

o Direct Costs: Directly related to project deliverables (e.g.,

software).

o Indirect Costs: Shared costs (e.g., office electricity).

o Sunk Costs: Money already spent (irrecoverable).

o Reserves: Funds set aside to manage risks.

Planning Cost Management (CP1)

 Goal: Create a cost management plan.

 Key Components:

1. Level of accuracy and units of measure.

2. Organizational procedures for managing costs.

3. Control thresholds for performance deviations.

4. Reporting formats for cost-related data.

Estimating Costs (CP2)

  Importance: Accurate cost estimates are critical for budget
adherence.

 Types of Cost Estimates:

1. Rough Order of Magnitude (ROM): High-level estimates for

early planning.

2. Budgetary Estimate: Used for allocating funds to a budget.

3. Definitive Estimate: Detailed and accurate, used for

purchasing decisions.

 Cost Estimation Techniques:

1. Top-Down Estimates: Based on similar projects; less

accurate.

2. Bottom-Up Estimates: Detailed estimates for individual

tasks; more accurate.

3. Parametric Modeling: Uses statistical relationships (e.g.,

cost per square foot).

4. Three-Point Estimates:

 Optimistic (O), Most Likely (M), and Pessimistic (P)

values.

 Formulas:

 Triangular Distribution:

 Beta (PERT):

Determining the Budget (CP3)

 Purpose: Allocate cost estimates to tasks over time.

 Inputs:

1. Scope Baseline.

2. Activity Cost Estimates.

3. Project Schedule.

 Reserves:

o Contingency Reserves: Account for known risks.

o Management Reserves: Account for unknown risks.

  Cost Baseline: Approved version of the project budget used for
tracking.

Controlling Costs (CP4)

 Goals:

1. Monitor cost performance.

2. Ensure appropriate changes are made to the cost baseline.

3. Inform stakeholders of cost-related changes.

 Key Techniques:

1. Earned Value Management (EVM):

 Planned Value (PV): Budgeted cost for planned work.

 Actual Cost (AC): Actual cost for completed work.

 Earned Value (EV): Budgeted value of completed

work.

 Formulas:

 Cost Variance (CV):

 Schedule Variance (SV):

 Cost Performance Index (CPI):

 Schedule Performance Index (SPI):

2. Rate of Performance (RP):

 Ratio of actual work completed to planned work.

 Rules of Thumb:

o Negative CV or SV indicates problems.

o CPI or SPI < 100% indicates inefficiencies.

o Use CPI to calculate Estimate at Completion (EAC).

Project Portfolio Management

 Purpose: Manage a suite of interrelated projects as a portfolio.

 Benefits:
 1. Saves costs through efficient resource allocation.

2. Improves project timeliness.

3. Enhances decision-making with risk-return analysis.

Sample Questions and Answers

Multiple Choice Questions (MCQs):

1. What is a Rough Order of Magnitude (ROM) estimate? a. A

detailed estimate for purchasing decisions.
b. A high-level estimate for early project planning.
c. An estimate used for budget allocation.
d. A precise calculation for specific tasks.
Answer: b

2. Which is an example of an indirect cost? a. Developer salary.

b. Software licensing.
c. Office electricity.
d. Outsourced testing services.
Answer: c

3. What does a negative cost variance (CV) indicate? a. The

project is under budget.
b. The project is over budget.
c. The project is on schedule.
d. The project is ahead of schedule.
Answer: b

Written Questions and Answers:

1. Explain the difference between contingency reserves and

management reserves.

o Contingency Reserves: Set aside for identified risks;

included in the cost baseline.

o Management Reserves: Allocated for unknown risks; not

part of the cost baseline and require approval for use.

2. Describe Earned Value Management (EVM) and its key

components.

o EVM integrates scope, time, and cost to measure project

performance. Key components include:

 Planned Value (PV): Budget for planned work.

  Actual Cost (AC): Money spent on completed work.

 Earned Value (EV): Budgeted value of work

completed.

 Formulas like CV and CPI help track cost efficiency.

3. What are the main benefits of project portfolio

management?

o Efficient resource allocation.

o Improved timeliness and coordination across projects.

o Enhanced decision-making through risk-return analysis.

Chapter 7: Project Cost Management

Importance of Project Cost Management

 Many IT projects fail to meet budget goals.

 Key statistic: A 2011 Harvard Business Review study found an

average cost overrun of 27%.

 Examples of poor cost management include government and

healthcare IT projects, such as the U.S. IRS and the UK National
Health Service.

What is Cost and Project Cost Management?

  Cost: Resources sacrificed to achieve an objective or something
exchanged for value.

 Project Cost Management: Processes to ensure the project is

completed within an approved budget.

Project Cost Management Processes

1. Planning Cost Management: Deciding how to manage project

costs.

2. Estimating Costs: Forecasting costs for all project activities.

3. Determining Budget: Allocating the cost estimate to tasks over

time.

4. Controlling Costs: Monitoring and managing changes to the cost

baseline.

Basic Principles of Cost Management

 Life Cycle Costing: Total cost over the product lifecycle, including
development, operation, and disposal.

 Cash Flow Analysis: Estimating annual costs and benefits for

projects.

 Terminology:

o Tangible Costs/Benefits: Easily measured (e.g., hardware

costs).

o Intangible Costs/Benefits: Hard to measure (e.g., customer

satisfaction).

o Direct Costs: Directly related to project deliverables (e.g.,

software).

o Indirect Costs: Shared costs (e.g., office electricity).

o Sunk Costs: Money already spent (irrecoverable).

o Reserves: Funds set aside to manage risks.

Planning Cost Management (CP1)

 Goal: Create a cost management plan.

 Key Components:
 1. Level of accuracy and units of measure.

2. Organizational procedures for managing costs.

3. Control thresholds for performance deviations.

4. Reporting formats for cost-related data.

5. Rules of performance measurement.

6. Process descriptions for monitoring and controlling costs.

Estimating Costs (CP2)

 Importance: Accurate cost estimates are critical for budget

adherence.

 Types of Cost Estimates:

1. Rough Order of Magnitude (ROM): High-level estimates for

early planning.

2. Budgetary Estimate: Used for allocating funds to a budget.

3. Definitive Estimate: Detailed and accurate, used for

purchasing decisions.

 Cost Estimation Techniques:

1. Top-Down Estimates: Based on similar projects; less

accurate.

2. Bottom-Up Estimates: Detailed estimates for individual

tasks; more accurate.

3. Parametric Modeling: Uses statistical relationships (e.g.,

cost per square foot).

4. Three-Point Estimates:

 Optimistic (O), Most Likely (M), and Pessimistic (P)

values.

 Formulas:

(O+4 M + P)
 Triangular Distribution: E=
3
 O: Optimistic estimate

 M: Most Likely estimate

 P: Pessimistic estimate
 (O+4 M + P)
 Beta (PERT): E=
6
 Learning Curve Theory: Suggests efficiency improves with
experience.

 Common Problems in Estimation:

1. Estimates done too quickly.

2. Lack of experience.

3. Bias towards underestimation.

4. Pressure from management for precision.

Determining the Budget (CP3)

 Purpose: Allocate cost estimates to tasks over time.

 Inputs:

1. Scope Baseline.

2. Activity Cost Estimates.

3. Project Schedule.

 Reserves:

o Contingency Reserves: Account for known risks.

o Management Reserves: Account for unknown risks.

 Cost Baseline: Approved version of the project budget used for

tracking.

Controlling Costs (CP4)

 Goals:

1. Monitor cost performance.

2. Ensure appropriate changes are made to the cost baseline.

3. Inform stakeholders of cost-related changes.

 Key Techniques:

1. Earned Value Management (EVM):

 Planned Value (PV): Budgeted cost for planned work.

  Actual Cost (AC): Actual cost for completed work.

 Earned Value (EV): Budgeted value of completed

work.

 Formulas:

 Cost Variance (CV): CV=EV−AC

 EV: Earned Value

 AC: Actual Cost
 Schedule Variance (SV): SV=EV−PV

 PV: Planned Value

EV
 Cost Performance Index (CPI): CPI=
AC
EV
 Schedule Performance Index (SPI): SPI=
PV

2. Rate of Performance (RP):

 Ratio of actual work completed to planned work.

 Rules of Thumb:

o Negative CV or SV indicates problems.

o CPI or SPI < 1 (100%) indicates inefficiencies.

o Use CPI to calculate Estimate at Completion (EAC).

 Using Reserve Analysis: Allocating contingency and management

reserves for unexpected costs.

Project Portfolio Management

 Purpose: Manage a suite of interrelated projects as a portfolio.

 Benefits:

1. Saves costs through efficient resource allocation.

2. Improves project timeliness.

3. Enhances decision-making with risk-return analysis.

Sample Questions and Answers

Multiple Choice Questions (MCQs):

 1. What is a Rough Order of Magnitude (ROM) estimate? a. A
detailed estimate for purchasing decisions.
b. A high-level estimate for early project planning.
c. An estimate used for budget allocation.
d. A precise calculation for specific tasks.
Answer: b

2. Which is an example of an indirect cost? a. Developer salary.

b. Software licensing.
c. Office electricity.
d. Outsourced testing services.
Answer: c

3. What does a negative cost variance (CV) indicate? a. The

project is under budget.
b. The project is over budget.
c. The project is on schedule.
d. The project is ahead of schedule.
Answer: b

4. What cost estimation technique uses statistical

relationships? a. Bottom-Up Estimation
b. Analogous Estimation
c. Parametric Modeling
d. Three-Point Estimation
Answer: c

Written Questions and Answers:

1. Explain the difference between contingency reserves and

management reserves.

o Contingency Reserves: Set aside for identified risks;

included in the cost baseline.

o Management Reserves: Allocated for unknown risks; not

part of the cost baseline and require approval for use.

2. Describe Earned Value Management (EVM) and its key

components.

o EVM integrates scope, time, and cost to measure project

performance. Key components include:

 Planned Value (PV): Budget for planned work.

 Actual Cost (AC): Money spent on completed work.

  Earned Value (EV): Budgeted value of work
completed.

 Formulas like CV and CPI help track cost efficiency.

3. What are common problems with IT cost estimates? How can

they be mitigated?

o Problems:

 Lack of experience.

 Underestimating costs.

 External pressures for precision.

o Solutions:

 Use reserve analysis for unexpected costs.

 Apply accurate estimation techniques like Bottom-Up

Estimation.

 Treat estimates as iterative processes, refining as more

data becomes available.

Chapter 8: Project Quality Management

Importance of Project Quality Management
  Quality is essential in IT projects, even though people often tolerate
occasional system downtime or reboots.

 Examples of quality issues:

o Software bugs cause 40% of computer system failures.

o High-profile incidents like the 2008 London Stock Exchange

glitch and the 2003 U.S. Northeast blackout were due to
software failures.

Key Definitions

 Quality (ISO): "The totality of characteristics of an entity that bear

on its ability to satisfy stated or implied needs."

 Cost of Quality:

o Includes cost of conformance (e.g., prevention and

appraisal costs) and cost of nonconformance (e.g., internal
and external failure costs).

Project Quality Management Processes

1. Planning Quality Management (Planning Phase):

o Defines how to ensure the project satisfies the requirements

for which it was undertaken.

o Focuses on preventing defects by:

 Selecting proper materials.

 Training and preparing the team.

 Designing processes to ensure quality.

2. Performing Quality Assurance (Executing Phase):

o Activities to satisfy quality standards, including:

 Benchmarking: Comparing practices to improve

performance.

 Quality Audits: Structured reviews of quality

management activities.

o Aims for continuous quality improvement.

3. Controlling Quality (Monitoring and Controlling Phase):

 o Involves monitoring project results to ensure compliance with
quality standards.

o Outputs:

 Acceptance decisions.

 Rework (fixing defects).

 Process adjustments.

Key Quality Terms and Aspects

 Conformance to Requirements: Ensuring processes and products

meet written specifications.

 Functionality: The degree to which a system performs its intended

function.

 Features: Characteristics that appeal to users.

 System Outputs: Screens and reports generated by the system.

 Performance:

o Measures how well the system handles data, transactions, and

user load.

o Includes response time and scalability.

 Reliability: The system’s ability to perform as expected under

normal conditions.

 Maintainability: The ease of performing maintenance on the

product.

Six Sigma

 Definition: A comprehensive and flexible system for achieving,

sustaining, and maximizing business success through disciplined
use of facts, data, and statistical analysis.

 Target for Perfection: No more than 3.4 defects per million

opportunities.

Six Sigma Methodologies

1. DMAIC (Improving existing processes):

o Define: Identify system requirements and project goals.

 o Measure: Collect data on the current process and calculate
capability.

o Analyze: Investigate cause-and-effect relationships and

identify root causes of defects.

o Improve: Optimize the process using techniques like mistake

proofing and pilot runs.

o Control: Maintain the improved process using monitoring

tools like statistical process control.

2. DMADV (Creating new processes or products):

o Define: Establish design goals aligned with customer

demands.

o Measure: Identify critical-to-quality characteristics and assess

risks.

o Analyze: Develop and evaluate design alternatives.

o Design: Create and refine the best alternative.

o Verify: Test and implement the final design.

Additional Quality Standards and Concepts

The "Six 9s of Quality"

 Quality level equal to 1 fault in 1 million opportunities (99.9999%

availability).

 Example: Telecommunication systems aiming for less than 30

seconds of downtime per year.

Maturity Models

1. Capability Maturity Model Integration (CMMI):

o Levels:

1. Initial: Processes are ad hoc.

2. Managed: Processes are planned and executed.

3. Defined: Processes follow organizational standards.

4. Quantitatively Managed: Processes are statistically

measured.

5. Optimizing: Continuous process improvement.

 o Applications:

 Development (CMMI-DEV), Services (CMMI-SVC),

Acquisition (CMMI-ACQ).

2. Organizational Project Management Maturity Model (OPM3):

o Released by PMI to promote excellence in project, program,

and portfolio management.

Testing and Quality Tools

Testing

1. Unit Testing: Tests individual components.

2. Integration Testing: Tests interactions between integrated

components.

3. System Testing: Tests the entire system as a whole.

4. User Acceptance Testing: Validates the system meets user needs.

 Program Inspections:

o Peer reviews to identify defects.

o Use checklists for common issues like initialization errors and

loop termination.

Seven Basic Tools of Quality

1. Flowcharts: Show process logic and help identify areas for

improvement.

2. Run Charts: Display variations in a process over time.

3. Scatter Diagrams: Show relationships between two variables.

4. Histograms: Visualize distributions of data.

5. Pareto Charts:

o Specialized histograms prioritizing problem areas.

o Based on the 80/20 rule (80% of problems come from 20% of

causes).

6. Control Charts:

o Display process results over time.

o Use the seven-run rule to identify non-random issues.

 7. Cause-and-Effect Diagrams:

o Also known as fishbone or Ishikawa diagrams.

o Help find the root cause of problems.

Who is Responsible for Quality?

 Project Managers: Ultimately accountable for quality

management.

 Standards and Resources:

o ISO (International Organization for Standardization).

o IEEE (Institute of Electrical and Electronics Engineers).

Improving IT Project Quality

1. Leadership: Promote a quality-focused culture.

2. Understanding Costs: Balance conformance and nonconformance

costs.

3. Focus on Workplace Factors: Enhance employee satisfaction and

organizational support.

4. Follow Maturity Models: Adopt frameworks like CMMI to improve

processes.

Summary

Project Quality Management ensures the project satisfies the needs for
which it was undertaken. It involves:

1. Planning Quality Management.

2. Performing Quality Assurance.

3. Controlling Quality.

It uses tools like testing and the seven basic quality tools, along with
methodologies like Six Sigma, to improve processes and ensure quality
deliverables.

Sample Questions and Answers

Multiple Choice Questions (MCQs):

1. What does the cost of quality include? a. Prevention costs only.

b. Appraisal and failure costs only.
c. Costs of conformance and nonconformance.
d. Direct costs only.
Answer: c

2. Which tool helps identify the root cause of problems? a.

Control Chart
b. Fishbone Diagram
c. Histogram
d. Run Chart
Answer: b

3. What type of testing validates the entire system? a. Unit

Testing
b. Integration Testing
c. System Testing
d. User Acceptance Testing
Answer: c

4. What is the target for Six Sigma perfection? a. 1 defect per

100 opportunities.
b. 3.4 defects per million opportunities.
c. 6 defects per 100,000 opportunities.
d. 9 defects per million opportunities.
Answer: b

Written Questions and Answers:

1. Explain the difference between conformance and

nonconformance costs.

o Conformance Costs: Incurred to ensure quality (e.g.,

training, testing, and process design).

o Nonconformance Costs: Incurred due to failures (e.g.,

rework, warranty claims, and lost business).

2. What are the seven basic tools of quality, and how are they
used?

o Flowcharts: Analyze process logic.

o Run Charts: Track variations over time.

o Scatter Diagrams: Show variable relationships.

 o Histograms: Display data distribution.

o Pareto Charts: Prioritize issues using the 80/20 rule.

o Control Charts: Monitor process stability and identify trends.

o Fishbone Diagrams: Identify root causes of problems.

3. What is Six Sigma, and how does it improve quality?

o Six Sigma is a methodology for improving processes by

minimizing defects and variability. It uses statistical analysis
and structured methodologies (DMAIC/DMADV) to enhance
process efficiency and customer satisfaction.

4. List and explain the levels of CMMI.

o Initial: Processes are ad hoc.

o Managed: Processes are planned and executed.

o Defined: Processes follow organizational standards.

o Quantitatively Managed: Processes are statistically

measured.

o Optimizing: Continuous process improvement.