The Template Collective Blog

Project management templates… and more
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Basics of Procurement

Procurement refers to obtaining goods and services from outside companies. This specifically refers to vendors and suppliers. It does not refer to other internal organizations within your own company. (For the purposes of this discussion, “purchasing” and “procurement” are equivalent terms.) This is an area that project managers definitely need to understand at some level, and it is an area into which the project manager will give input. However, in many, and perhaps most companies, procurement is an area that the project manager does not own. The project manager normally does not have the authority to enter into contracts on behalf of the company, and he normally is not asked to administer the contracts once they are in place. (In some organizations the project managers have this authority, but my perception is that in most organizations they don’t.) 

If you are purchasing goods or services on your project, you should determine whether you will simply follow the procurement contracts and plans that are already established by your company or your organization.

Examples

  • You may purchase hardware from companies using a pre-existing company contract.
  • You may acquire contactors using a pre-selected preferred vendor list.

In some cases, the vendor identification and selection processes occur at an organization level.

For instance, your company may purchase a Customer Relationship Management (CRM) system based on high-level management requirements. This CRM system would then be used on all subsequent projects – regardless of the specific needs of each individual project.

If your project team is actually conducting the vendor identification and selection process, you have some flexibility on when it is done. Many project teams perform the vendor identification and selection processes during the project Analysis Phase. This would be the case if you need to better understand your business requirements before you determine the vendor that can best meet the requirements.

Once the vendor is chosen, there are many procurement processes that are part of project management monitoring and control. This includes monitoring the vendor progress, answering questions, validating invoices, paying invoices, managing contractual issues, etc. Ultimately the procurement process concludes when the project is completed and all project contracts are closed.

In general the processes and techniques for procurement are not so hard, but it is an area where many project managers don’t have a lot of experience. In fact, many project managers only acquire procurement knowledge as a way to pass the PMP Exam.  

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Know the Five Steps in a Document Life Cycle

Document management is a part of communication management. It is important for the project manager to recognize the stages that a document must go through from creation to completion. This knowledge allows the project manager to understand the overall status of a document at any given time and helps ensure adequate time is allocated for the completion of the document. For instance, when a team member says they can complete a document in two weeks, are they saying that the document will be ready to circulate in two weeks or that the document will be completed and totally approved in two weeks? Not all documents need to go through all the stages of document creation and approval. However, depending on the document, one or more of the steps will be required.

Plan the document

Sometimes you can sit down and immediately start writing your document. Other times you need to think, prepare and plan first. This is especially true as your document gets larger and more complex. Preparation and planning, which includes outlining the content and structuring the sections, will help you get started.

Create the initial document draft

In this step, the document draft is created. If there are no subsequent reviews and approvals, this step results in the creation of the final deliverable. Most of the effort associated with the document is used in this step. Subsequent steps may take a long duration, but they do not take nearly as much effort.

Circulate document for feedback
M
odify as appropriate

These two steps involve circulating the document for initial review and feedback. The document is updated based on the review comments. Depending on the particular document, this may be an iterative step. A document may have an internal review, followed by a stakeholder review, followed by a management review. After each of these reviews, the document is subsequently modified based in the feedback and sent to the next step.

Gain document approval

When the document has been circulated for feedback and subsequently updated, it will be ready for final approval. Some documents should be formally approved in writing. Others are simply considered complete after the final round of feedback is received.

Like all completed deliverables there may be subsequent updates or enhancements that may require their own mini-document life cycle as well.

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Six Components of a Procurement Management Plan

The Procurement Management Plan is a part of the overall Project Management Plan. The document describes how items will be procured during the project and the approach you will use to managing vendors on the project. Specific areas to describe include:

Procurement process. This section provides a brief overview of the process requirements necessary to manage procurement of the identified needs. This process should include:

  • Initiating a request
  • Development of requirements (technical, timing, quality, constraints)
  • Request approval
  • Purchasing authority
  • Bid / proposal review
  • Contract management responsibility
  • Contract closure requirements
  • Procurement process flowchart

Roles and responsibilities. This section describes the various roles on the project that have some connection to procurement. This section should describe who can request outside resources, who can approve the requests, any secondary approvers, etc.

Identified procurement needs. This section details the material, products or services identified for outside procurement.  Each listed item should include a justification statement explaining why this should be an outside purchase if there is the possibility of inside sourcing (make vs. buy decision).

Timing. This section will describe the timeframe that resources are needed. This will provide a better sense for when the procurement process needs to be started for each item.

Change review and approval process. Describe how changes are made to procurement documents to ensure the changes are valid, understood and approved by the appropriate people.

Vendor processes. Describe the processes that the vendors should use for timesheet approval, invoice processing, contract renegotiation, status reporting, scope change requests, etc.

There may be additional information in the plan as well to ensure the procurement process is understood and managed effectively.

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Ten Steps to Manage Issues on Large Projects

Issues are more than just common problems. They are problems that meet specific criteria. An issue is a formally-defined problem that willimpede the progress of the project and cannot be totally resolved by the project manager and project team without outside help. The processes used to manage issues can be simpler or more rigorous depending on the size of the project. Use the following process to manage issues on large projects.

    1. Identify the problem and document on the Issues FormSolicit potential issues from any project stakeholders, including the project team, clients, sponsors, etc. The issue can be surfaced through verbal or written means, but it must be formally documented using an Issues Form.
    2. Determine if the problem is really an issueThe project manager determines whether the problem can be resolved or whether it should be classified as an issue.
    3. Enter the issue into the Issues LogIf it is an issue, the project manager enters the issue into the Issues Log.
    4. Determine who needs to be involved in resolving the issueThe project manager determines who needs to be involved in resolving the issue. The sponsor may be involved, or the sponsor may not have the expertise to assist in the resolution process. For instance, the problem may be contractual and require resolution from the Purchasing Department. However, at some point the alternatives will be discussed and a resolution will be made. It is important to understand up-front who needs to be involved in making this final issue resolution.
    5. Assign to team member for analysis and alternativesThe project manager assigns the issue to a project team member for investigation (the project manager could assign it to himself or herself). The team member will investigate options that are available to resolve the issue. For each option, the team member should also estimate the impact to the project in terms of budget, schedule and scope.
    6. Gain agreement on resolutionThe various alternatives and impact on schedule and budget are documented on the Issues Form. The project manager should take the issue, alternatives and project impact to the appropriate stakeholders (from step 6 above) for discussion and resolution. The project manager may want to make a recommendation from among the alternatives as well.
    7. Close the Issues LogThe project manager documents the resolution or course of action on the Issues Log.
    8. Close the Issues FormThe project manager documents the issue resolution on the Issues Form and then closes and files this document.
    9. Add action plan to the scheduleOnce a resolution is agreed upon, the appropriate corrective activities are added to the schedule to ensure the issue is resolved.
    10. Communicate through the Status ReportThe project manager communicates issue status and resolutions to project team members and other appropriate stakeholders through the methods established in the Communication Management Plan, including the project Status Report.

Smaller projects do not need all of these steps. For instance, the issue can be documented directly in the Issues Log without the need for the separate Issues Form.

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Schedule Estimating Threshold

When you create a schedule you generally don’t know enough to enter all of the detailed activities the first time though. Instead, you identify large chunks of work first, and then break the larger chunks into smaller pieces. These smaller pieces are, in turn, broken down into still smaller and more discrete activities. This technique is referred to as creating a Work Breakdown Structure (WBS).

A question people ask is how small the activities should be before they do not need to be broken down further. This is referred to as your “estimating threshold”. Work can be broken down into smaller activities than the estimating threshold, but normally no work would be left at a higher level. The threshold can be different based on the size of your project and how well the work is understood.

You can use the following criteria as a guide. For a typical large project (say 5000 effort hours or more) the activities should be no longer than two weeks. Medium and small projects (say 1000 effort hours or less) should have activities no larger than one week. Remember that this threshold is an upper limit. You can break the activities down further if you want.

Assigning work that is smaller than your threshold allows the work to be more manageable. Think about it. When you assign work to a team member you don’t know for sure how he is progressing until the due date (or the completion date if it comes first). (Yes, you can track progress if the work proceeds linearly – like painting a wall. But many of us work in the knowledge business (IT, Sales, Finance) and it is not easy to know exactly how the work is progressing.)

Let’s look at an example. If you assign a team member work that is due in four weeks, you are not going to know for sure whether the work is on time until the four-week deadline. The worker may tell you things are on track, but you don’t really know for sure until the due date. If the work is completed you will know you are on track. If the work is late you will know it then as well. However, four weeks (or longer) is too long to wait to know if the work is on track. A better approach is to break the four-week activity into four one-week activities. Then you will know after the first week if the work is on time or not.

If at all possible you want to try to have schedule work completed within two weeks. If you give someone work that takes four weeks or longer there is just too much time before you really know if things are on-track or not. It is much better for you if you can keep the schedule feedback loop to no more than two weeks.

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Manage the Schedule for Small Projects

All projects need a schedule. If you have a small project perhaps the schedule is a simple checklist or Excel spreadsheet. As projects get larger they need more formal scheduling templates and tools.

The processes you use to manage a schedule also vary depending on the size of the project. Large projects need a lot of schedule management rigor. Small projects can use a lighter process. The following steps can be used to mage the schedule of a small project.

Review the schedule on a weekly basis.

Identify activities that have been completed during the previous week and update the schedule to show they are finished.

Determine whether there are activities that should be completed, but are not. Work with the individual that is assigned to the work see what is going on. Determine how much additional effort and duration are needed to complete the work and update the schedule accordingly.

Evaluate the remaining work to see if the project will be completed within the original duration. You may find that even though some activities may be completing later than planned, other activities may be completing early and the overall schedule may still be okay.

If your project is trending behind schedule, think of schedule management techniques you can apply to get back on schedule. Raise a schedule risk in your status report if the original deadline appears to be in jeopardy.

Adjust the schedule so that it reflects the remaining work to be completed, and is as accurate as possible.

Since this is a process for a small project, it would be unusual to have major problems with the schedule. The consequences of problems on small projects are generally small as well.

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Define the Objectives of Your Project

Define the Objectives of Your Project

Objectives are concrete statements that describe the things the project is trying to achieve. They are included in your Project Charter. An objective should be written in a way that it can be evaluated at the conclusion of a project to see whether it was achieved. A well-worded objective will be Specific, Measurable, Attainable / Achievable, Realistic and Time-bound (SMART). (SMART is a technique for wording the objective. An objective does not absolutely have to be SMART to be valid.)

An example of an objective statement might be to “upgrade the customer service telephone system by December 31 to achieve average client wait times of no more than two minutes“.

  • Note that the objective is specific.
  • The objective is measurable in terms of the average client wait times the new phone system is trying to achieve.
  • You can assume that the objective is achievable and realistic.
  • The objective is time-bound, and should be completed by December 31.

Objectives should infer the deliverables of the project. In the prior example, the objective refers to the upgrade of the telephone system. If you cannot determine the deliverables that are created to achieve the objective, the objective may be written at too high a level. On the other hand, if an objective describes the characteristics of the deliverables (such as speed or ability to handle a specific number of users), it is written at too low a level. Characteristics tend to be more requirements statements – not objectives.

If the project is a part of a larger program, the objectives of all the underlying projects should be in alignment with the program objectives.

Objectives are important because they show a consensus of agreement between the project manager and the project sponsor on the main purpose of the project. For example, the specific deliverables of an IT project may or may not make sense to the project sponsor. However, the objectives should be written in a way that they are understandable by all of the project stakeholders.

Objectives are also valuable since they provide alignment to organization goals and strategies. Your organization should not authorize projects that do not tie to goals and strategies

The project objectives should be defined and agreed upon before the project starts. The deliverables of the project are created based on the objectives. A facilitated meeting between all major stakeholders is a good way to create the objectives and gain a consensus on them at the same time.

Training

Four Steps to Show the Value of Training

Four Steps to Show the Value of Training

Many businesses struggle with whether they are getting their money’s worth in sending employees to training classes. This question can be applied to project management training as well as any other type of business training. You know the cost side of training too well. But how do you tell what the business value is?

The most common way to determine value today is to ask the trainee whether he or she thinks the class was valuable. This is very touchy-feely and doesn’t give you much information to go on, but it is probably the most that most companies ask in terms of follow-up.

A Rigorous Approach

There is a process to more rigorously determine the value received for your training dollars. These ideas are not for the faint of heart. They take more preparation and they take more of that most precious commodity – time. But see if it makes sense, and whether the results of this process will give you a much better feel for the value that you are receiving from training. You can also start with some of these steps, and try for the rest later.

    1. First, the trainee and their manager meet a few weeks before the training is scheduled to make sure the trainee is ready for the class. One of the important parts of the discussion is to identify opportunities where the trainee can apply the new skills on their job. This information should be documented so that it can be compared with a post-class assessment done later.
  • When the actual class begins each of the trainees should complete an initial survey showing their specific knowledge level of the class material.
  • A week or two after the class, the trainee completes a post-class survey showing their current knowledge level in the subject. For the most part, it is exactly the same as the initial survey from activity #2 above. This is compared to the initial survey to provide a sense for how much the trainee learned – at least in their own opinion. If this survey comes out close to the original version, it may show that the training may not have been very effective. You would expect that the post-class survey would show improvement.
  1. Here is the key step. A few months after the class, the trainee and their manager meet again for a post-class assessment, which is a follow-up to activity #1 above. In this discussion, the trainee and manager discuss the value of the class, and whether the trainee has been able to apply the new skills. In fact, the training may have been superb, but if there have been no opportunities to apply the new skills, then the business value will be marginal. The trainee and manager can then discuss the business value that was gained by applying the new skills on the job.

Summary

In most training classes today, the trainee completes the class feedback for the benefit of the training company, and then tells his or her manager how good the class was. This superficial feedback is all that is available to gauge business value. However, the real test of business value is whether the class resulted in an increased skill level that can be applied to the job to make a person more productive. This cannot be determined immediately after a class. The only way to determine business value is to determine in the months after the class whether or not the training has actually been applied on the job. If you capture this information on all your classes, you will get a much better and more fact-based view of whether the classes you pay for are providing business value to your company.

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Three Techniques for Scope Change Management

1. Hold Everyone Accountable for Scope Management

Many scope management processes work well at the project manager level, but get compromised by team members. If the project manager is diligent in enforcing the scope change rules, your customer may try to go directly to team members for changes.

The bottom line is that everyone needs to be held accountable for the scope management process. Team members must understand the process and why it is important. Your customer  must also understand the process and its importance. Don’t consider these procedures to be only of interest to the project manager and the sponsor. Make sure the procedures are communicated to the entire team.

2. Use a Change Control Board for Large Projects

Sometimes on very large projects, the project sponsor does not feel comfortable making the scope change decisions alone. This may especially be the case if the effect of the change will impact other organizations. It may also be the case that multiple organizations are participating in, or contributing to, the project funding, and want to have some say in evaluating scope change requests. For these cases, a group of people might be needed to handle the scope change approval.

A common name for this group is a Change Control Board. If a Board exists, it may be more cumbersome to work through. However, the general scope change management process does not need to change dramatically. For instance, there is still a document for the initial the scope change request. The project team needs to determine the impact and cost to the project. The Board must consider the impact, the value to the project, the timing, etc., and then make a determination as to whether the request is accepted.

The Scope Change Procedures must be more sophisticated to account for the Board. For instance, you need to clarify who is on the Board, how often they will meet, how they will be notified in emergencies, how they will reach decisions (consensus, majority, unanimous, etc.), how incremental work will be paid for, etc.

3. Make Sure the Right Person Approves Scope Changes

A typical problem on a project is that the team does not understand the roles of the sponsor, customer and end users in the area of change management. In general, the project sponsor is the person who is funding the project. The sponsor is usually high up in the organization and not easy to see on a day-to-day basis. 

The people that the project team tends to work with most often are normal customers and end users. End users are the people that use the solution that the project is building.

It doesn’t matter how important a change is to an end user, the end users cannot make scope change decisions and they cannot give your team the approval to make a scope change. The sponsor (or designee) must give the approval. The end users can request scope changes, but they cannot approve them. The end user cannot allocate additional funding to cover the changes and cannot know if the project impact is acceptable.

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Five Steps Before Estimating Work

Estimating is hard enough. It is even harder if you are not prepared. Estimating a 20 hour chunk of work is not so hard. Estimating for full projects or large chunks of work can be challenging. Templates can help, but consider the following steps before you begin the estimating process.

Get a clear picture of the work that is being estimated

Many problems with estimation come because the estimator is not really sure what the work entails. You should avoid estimating work that you do not understand. This should not imply that you can know every detail. The estimating contingency is a way to reflect some of this remaining uncertainty.

Determine who should be involved in the estimating process

The project manager may or may not know enough to make the estimates on his or her own. It is usually a good practice to look for estimating help from team members, clients, subject matter experts, etc. This will usually result in the estimates being far more accurate than you would get by yourself.

Determine if there are any estimating constraints

If there are estimating constraints, it is important to know them up-front. For instance, the end-date may be fixed (timeboxed). You should also know if the client expects Six-Sigma level quality in the deliverables, or if the 80/20 rule will apply. It is possible that there may be a fixed budget that cannot be increased. (This would be of interest so that you can reduce the scope of work, if necessary, to meet the fixed budget.) Knowing these constraints will help the estimators make valid assumptions regarding the cost, duration and quality balance.

Determine multiple estimating techniques to utilize if possible

There are a number of techniques that can be used to estimate work. If possible, try to use two or more techniques for the estimate. If the estimates from multiple techniques are close, you will have more confidence in your numbers. If the estimates are far apart, you need to review the numbers to see if you are using similar assumptions. In this case, you can also try to utilize a third (and fourth) estimating technique to see if one initial estimate can be validated and the other rejected.

Document all assumptions

You will never know all the details of a project. Therefore, it is important to document all the assumptions you are making along with the estimate.