Exploring the Project Management Knowledge Areas – Part 2

Project Cost Management

The Project Cost Management
Knowledge Area centers around costs and budgets:

Plan Cost Management: Planning

Estimate Costs: Planning

Determine Budget: Planning

Control Costs: Monitoring and Controlling

The activities in the
Project Cost Management Knowledge. Area establish cost estimates for resources, establish budgets, and keep watch over those costs to ensure that the project stays within the approved budget. The earlier you can develop and agree on the scope of the project, the earlier you can estimate costs. The benefit of this practice is that costs are more easily influenced early in the project.

This Knowledge Area is primarily concerned with the
costs of resources, but you should think about other costs as well. For example, be certain to examine ongoing maintenance and support costs for software or equipment that may be handed off to the operations group at the end of the project.

Depending on the complexity of the project, these processes might need the involvement of more than one person. For example, the finance person might not have expertise about the resources documented in the
staffing management plan, so the project manager will need to bring in a staff member with those skills to assist with the activities in this process.

Two techniques are used in this Knowledge Area to decide among alternatives and improve the project process:
life cycle costing and value engineering. The life cycle costing technique considers a group of costs collectively (such as acquisition, operations, disposal, and so on) when deciding among or comparing alternatives. The value engineering technique helps improve project schedules, profits, quality, and resource usage and
optimizes life cycle costs, among others. Value engineering, in a nutshell, involves optimizing project performance and cost and is primarily concerned with eliminating unnecessary costs. By examining the project processes, performance, or even specific activities, the project manager can identify those elements that are not adding value and could be eliminated, modified, or reduced to realize cost savings. These techniques can improve decision making, reduce costs, reduce activity durations, and improve the quality of the deliverables. Some application areas require additional financial analysis to help predict project performance. Techniques such as payback analysis, return on investment, and discounted cash flows are a few of the tools used to accomplish this.

Project Quality Management:

The Project Quality Management Knowledge Area is composed of three processes:

Plan Quality Management: Planning

Perform Quality Assurance: Executing

Control Quality: Monitoring and Controlling

The
Project Quality Management Knowledge Area assures that the project meets the requirements that it was undertaken to produce. This Knowledge Area focuses on product quality as well as on the
quality of the project management processes used during the project. These processes measure overall performance and monitor project results and compare them to the quality standards set out in the project-planning process to ensure that the customers will receive the product, service, or result they commissioned.

Project Human Resource Management:

The Project Human Resource Management Knowledge Area consists of four processes:

Plan Human Resource Management: Planning

Acquire Project Team: Executing

Develop Project Team: Executing

Manage Project Team: Executing

Project Human Resource Management involves all aspects of people management and personal interaction, including leading, coaching, dealing with conflict, conducting performance appraisals, and more. These processes ensure that the human resources assigned to the project are used in the most effective way possible. Some of the project participants on whom you’ll practice these skills are
stakeholders, team members, and customers. Each requires the use of different
communication styles, leadership skills, and team-building skills. A good project manager knows when to enact certain skills and communication styles based on the situation.

Projects are unique and temporary, and project teams usually are too. Teams are built based on the skills and resources needed to complete the activities of the project, and many times project team members might not know one another. The earlier you can involve team members on the project, the better because you’ll want the benefit of their knowledge and expertise during the planning processes. Their participation early on will also help assure their buy-in to the project.

Because the makeup of each team is different and the stakeholders involved in the various stages of the project might change, you’ll use different techniques at different times throughout the
project to manage the processes in this Knowledge Area.