p2f Userguide

PRINCE2® 7
Foundation
User Guide v1.0

25/08/23
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2
Contents
Foreword .............................................................................................................................................. 4
Session 1: Course Overview ................................................................................................................. 5
Session 2-1: Projects, Principles, Practices and Processes ................................................................... 9
Session 2-2: People ............................................................................................................................ 19
Session 2-3: Processes and Practices Quiz......................................................................................... 26
Session 3-1: Practice: Business Case ................................................................................................. 28
Session 3-2: Theme: Organizing ......................................................................................................... 35
Session 3-3: Practice: Plans................................................................................................................ 43
Session 3-4: Practice: Quality.............................................................................................................. 52
Session 3-5: Practice: Risk.................................................................................................................. 59
Session 3-6: Practice: Issues .............................................................................................................. 66
Session 3-7: Practice: Progress .......................................................................................................... 71
Session 4-1: Processes: SU, IP........................................................................................................... 77
Session 4-2: Processes: CS, MP, SB .................................................................................................. 81
Session 4-3: Processes: CP, DP ......................................................................................................... 85
Session 4-4: Process Model Walkthrough ........................................................................................... 89
Session 5: Foundation Exam Simulator ............................................................................................... 91
Session 6: Case Study ........................................................................................................................ 92
Foreword
ILX Group plc is a leading developer and distributor of multimedia training products specialising in the
area of project and programme management.
PRINCE2 Foundation uses the very latest multimedia educational techniques to provide a learning
environment which is stimulating, easy-to-use and stress-free.
The aim of this course is to take students with little or no knowledge of PRINCE2 to the level where they
could take the Foundation (Part 1) examinations with a high degree of confidence in achieving a pass.
The examination within the course package uses previous examination questions that are accessed at
random to provide an accurate simulation of the real thing.
We hope you enjoy the course and that you find it a useful starting point in your PRINCE2 training
programme.
Session 1: Course Overview
Session 1: Course Overview student examination – namely Foundation level

and the more advanced Practitioner level.
S1P1: Objectives A “pass” at the Foundation level is a pre-

Tony: requisite of sitting the Practitioner examination,
Welcome to session 1 of this complete however, attainment of other project
eLearning training course in the PRINCE2 management qualifications, such as the
method. Association of Project Management’s PMQ or
PPQ, would also qualify.
This introductory session is intended to help
you get the most out of the training programme This Foundation course has been specifically
and to give you a basic appreciation of what configured to give you all the information and
PRINCE2 is and why it is relevant. training that you will require to confidently take
the PRINCE2 Foundation examination and
By the end of this session, you will be able to: does not assume any prior project
management knowledge or qualifications.
• State the objectives of the course
• Recall the benefits of using PRINCE2 Should you wish to go on and take the
• State the five ‘integrated elements’ Practitioner examination at a later stage, then
that the PRINCE2 method comprises ILX can provide all the necessary additional
of, and training materials.
• List the main roles involved in a
However, examinations are not really what
PRINCE2 project.
PRINCE2 is all about, and many people just
want to use PRINCE2 to improve the quality of
S1P2: Course Structure
their project management.
Tony:
Firstly, I’d like to introduce myself. My name is So, perhaps a more important, business-
Tony and I'm the course tutor and you’ll be oriented objective of this course is that once
hearing my voice throughout the course. I you have completed your studies you should
have two students with me who’ll be helping be able to operate as an informed member of a
me in many of the sessions. project team, operating in a PRINCE2
environment.
Pete:
Hi, I’m Pete and I’ll be working with the team
asking questions and providing some of the
answers as well. S1P4: Supporting Material
Tony:
Karen: In addition to the eLearning course, there are
And I’m Karen. Like Pete, I’ll also be some additional materials that will help you in
answering some of Tony’s questions with you. your studies.
I hope you enjoy the course.
The first and most important is a copy of the
Tony: PRINCE2 Manual itself, be it as an eBook
We expect the course to take around 15 hours within the ‘eBooks’ tab in the PeopleCert portal,
study time to complete and each session lasts or as a physical printed book. This course has
around 25 minutes including the exercises. been accredited as a standalone product. As
such access to a printed PRINCE2 manual is
If you require technical support or you consider
not essential for foundation level study.
some aspect of the course to be unclear,
However, an eBook of the manual is provided
please contact ILX using the contact details
as default when redeeming the Foundation
shown on screen here.
exam voucher, plus if you intend to continue
your studies up to Practitioner level, then
having a copy of the PRINCE2 manual, eBook
S1P3: Course Objectives or physical, will be essential.
Tony:
One of the major advantages of PRINCE2 is If you have purchased this course as part of
that there is a universally recognised set of one of our bundled packages, then you will
examination standards – which are have a copy of this book. Otherwise,
independent of the training providers. remembering that you receive a PRINCE2
eBook when redeeming your Foundation exam
AXELOS Limited, who is the author of voucher, if you require a physical book in
PRINCE2, is owned by PeopleCert, the addition, then these can be purchased from ILX
Examination Institute, who define two levels of Group.
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You are not allowed to take the eBook, physical • Culture, or

manual, or any other materials into the • Geographical location.
Foundation examination with you, but if you are
serious about PRINCE2, then you should PRINCE2 achieves this by:
consult the eBook which can be accessed via
your PeopleCert profile, in the ‘My eBooks’ tab, • Separating the management of project
as a bare minimum. work from the specialist development
activities, such as design or
You may also have been provided with a construction, allowing any specialist
document called the Course User Guide, either activities to be integrated into a
in paper-based or electronic form. This useful controlled environment for the project
document contains a more or less full transcript • Focussing on what needs to be done
of this course content, slightly modified to make to manage the project, rather than
it suitable to the different medium. prescribing how work is done, and
• Requiring that the method is
We also recommend that you download a copy
established specifically for the needs
of the Foundation Syllabus which you can use
and context of the project by the way it
to monitor your progress.
is applied and tailored.
Although by no means essential, you may find
these documents useful, both during and after PRINCE2’s adaptable nature can provide
your studies. You can find these documents in significant benefits in all facets of business
the course’s resources tab. activity, whilst strengthening organizational
capability and maturity.
The PRINCE2 book lists many important

S1P5: Character Introduction benefits. We have summarized these here for
Tony: your convenience.
During this course you will come across a
number of characters that are involved with
PRINCE2. Let’s introduce you to some of these S1P7: Structure of PRINCE2
characters before we get started. Tony:
PRINCE2 provides project management by
Here we have the Project Board, which is integrating five elements which are:
responsible for the overall direction and
management of the project. The Project Board • PRINCE2 principles
consists of the Project Executive, seen here • People
sitting in the middle, who is ultimately • PRINCE2 practices
accountable for the project and is supported by • PRINCE2 processes, and
the Senior User and Senior Supplier. • The project context.
There are seven principles which underpin the
The Project Manager runs the project on a day- method and they are the guiding obligations
to-day basis and is responsible for ensuring the which determine whether the project genuinely
required products are produced to the required is being managed using PRINCE2.
standard and quality.
Then we have the ‘people’ integrated element,
Actual responsibility for delivering the products which encompasses both those affected by the
is delegated to the Team Managers and their project, in business as usual, plus those who
team members. They can be internal or are working on the project and the relationships
external to the customer’s organization, which between them.
is also referred to as 'The business’ or
‘Commissioning authority’ in PRINCE2. There are seven practices which describe
those aspects of project management that must
be addressed continually as a project
S1P6: What is PRINCE2? progresses throughout the project lifecycle.
Tony: The seven processes describe the activities
One of the great strengths of PRINCE2 is that it which we use from the beginning of the project
is truly adaptable. It is applicable to any project to the end and they provide checklists of
regardless of; recommended activities, products and related
• The project’s purpose responsibilities.
• The scale of the project The project context ensures that the principles,
• The type of project practices and processes are applied by the
• The nature of the organization
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people involved in the project to ensure the D. Techniques.

method is fit for the project context.
Choose from the following answers:
By context, we mean examining the
organizational context, considering users, 1. A and B
suppliers and business decision-makers. Also 2. B and C
the commercial context, which could 3. C and D
encompass entering into a commercial 4. A and D.
relationship with a supplier following a formal
tender. Project context also includes S1P10: Activity
consideration of the delivery method to be used Tony:
on the project, such as linear or iterative and Identify the missing word in the following
incremental. sentence.
Finally, the context element also incorporates PRINCE2 is designed to be adaptable so it can
consideration of the scale of a project, and how be applied to any project, separating the
this might influence the tailoring of the method, management of project work from the [?]
plus how sustainability objectives of the development aspects.
business, for example around climate action or
gender equality, can influence the project’s 1. Technical
objectives. 2. Specialist
3. Quality
4. Structural.
S1P8: What makes a Project a PRINCE2 S1P11: Activity

Project? Tony:
Tony: Which role is ultimately accountable for the
success of the project?
PRINCE2 is designed to be tailored or adapted
to meet the needs of the organization. 1. Project Executive
However, to be considered as a PRINCE2 2. Senior User
project, the project must be able to 3. Project Manager
demonstrate that it is: 4. Senior Supplier.
• Applying all the PRINCE2 principles
S1P12: Activity
• Meeting the minimum requirements
Tony:
set out in the PRINCE2 practices
From this list, can you identify two elements
• Using processes that satisfy the
which can be considered two of the ‘common
purpose and objectives of the
contexts’ of the fifth integrated element of the
PRINCE2 processes, and PRINCE2 method, ‘project context’?
• Using the recommended techniques
suggested by the method or other A. Commercial
equivalent techniques. B. Delivery method
C. PRINCE2 processes
Otherwise, users of PRINCE2 are free to tailor D. People.
PRINCE2 to their needs as described Choose from the following answers:
throughout the manual and this course.
1. A and B
Tailoring will also be considered in more detail 2. B and C
in your Practitioner studies. 3. C and D
4. A and D.
Let’s move on to try a few multiple-choice
questions. S1P13: Summary
Tony:
S1P9: Activity This introductory session was intended to help

you get the most out of the training programme
Tony: and to give you a basic appreciation of what
From this list can you identify two of the five PRINCE2 is and why it is relevant.
integrated elements of PRINCE2?
You will now be able to:
A. Roles and responsibilities
B. Practices • State the objectives of the course
C. Project context • Recall the benefits of using PRINCE2
7
• State the five integrated elements that

the PRINCE2 method composes of,
and
• List the main roles involved in a
PRINCE2 project.
8
Session 2-1: Projects, Principles, Practices and Processes
Session 2-1: Projects, Principles, • Temporary, because they have a

beginning, middle and end, whereas
Practices and Processes
BAU is ongoing, and becomes the
‘new BAU’ once a project has been
S2-1P1: Introduction implemented
Tony:
Welcome to this session where we will review • Cross-functional, because we tend to
the overall structure of PRINCE2, its principles, need a team of people with a range of
practices, processes and project context. skills to deliver the products whereas
BAU tends to have a single skill set
In the 7th edition of PRINCE2, we also have relating to the business function
the new integrated element of ‘people’, which
we will explore in the next session. • Unique, as each project is different in
some way whereas BAU tends to be a
By the end of this session you will be able to:
repetitive operation, and finally
• Identify the PRINCE2 definition of a
project • Uncertainty, because all projects carry
• List and explain the 7 principles which risk because of the factors just
underpin PRINCE2 described. In BAU we usually try to
• List and describe the 7 processes and eliminate risks due to its repetitive
the 7 practices of PRINCE2, and nature.
• Understand the project context, and
how this might influence the tailoring
of your particular project. S2-1P3: What we wish to Control
Tony:
Projects come in all shapes and sizes such as
This session relates to learning outcomes 1 introducing a new IT system, developing a new
and 2 of the PRINCE2 Foundation syllabus. drug, or perhaps holding an event.
Let’s make a start by considering just what a They are often influenced by the environment
project is and how that relates to the PRINCE2 within which they operate. These can be
methodology. external factors such as politics or the natural
environment or
S2-1P2: A PRINCE2 Project internal factors such as internal policies, and

Tony: industry regulations.
It is a well-known fact that businesses must Whatever the project there are seven aspects
respond to the changing environment if they of performance, or ‘performance targets’ by
are to continue to be successful. another name, to be managed.
Therefore, a major challenge for them is to These are:
maintain the current business operations which
we term business as usual or BAU and, at the • Scope, which refers to everything we
same time, introduce change to respond to the are going to buy or build and all the
need to be successful in the new environment. work involved in doing it. We also
include items that are out of scope to
Projects are the way we introduce change into
set the stakeholders’ expectations
an organisation because a project delivers new
• Quality, which defines the standards
business products which when used correctly
which the delivered scope must meet
will move the business to a new future.
to be fit for purpose
PRINCE2 defines a project as “a temporary • Risk, which relates to the things that
organization that is created for the purpose of might not go exactly to plan. Risks
delivering one or more business products that happen can have negative
according to an agreed business case”. consequences, which we call threats,
or positive outcomes which we call
PRINCE2 suggests 5 characteristics of project opportunities
work that differentiates it from BAU. These are: • Cost, which determines the project’s
budget
• Change, as we use projects to • Time, which describes the duration of
introduce new products which are the project
used to change the business
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• Benefits, these are the measurable investment in the changes required to achieve
improvement within BAU because of its strategic objectives.
the project, and finally
• Sustainability, which acknowledges
that all projects have an impact on the S2-1P5: Project Context – Commercial
environment, and project teams Tony:
therefore need to be aware of Next, as part of the ‘project context’ integrated
sustainability performance targets for element of PRINCE2, we consider projects
the project work and for the products where the business enters into a commercial
being created by the project. arrangement with a supplier to deliver the
PRINCE2 is an integrated method of principles, project, usually following a formal tender.
processes, people and practices that address The organization delivering the project, namely
the planning, delegation, monitoring and control the supplier, will do so to satisfy a particular
of all these seven aspects of project need identified by the business, namely the
performance. customer.
In PRINCE2, the term ‘customer’ is used only

S2-1P4: Project Context – Organizational when there is a commercial relationship
Tony: between the business and supplier.
Projects exist in many contexts or The business may also break the work into
environments and it is important to understand several elements each of which will be
these before embarking on a project. undertaken by a different supplier, and some of
We’ll spend a few moments to review the the work may be undertaken by the business
various contexts within which you may find your themselves.
project operating. The supplier may also use subcontractors to
Firstly, we will examine the ‘organizational deliver some of their work.
context’. PRINCE2 assumes there will be Therefore, there may be a hierarchy of
users who will specify the desired products, commercial relationships between suppliers,
suppliers who will provide the resources and and rather than the simple customer/supplier
expertise to deliver those products, and relationship involving two organizations,
business decision-makers who ensure the projects often involve multiple organizations
investment in the project is justified. covered by multiple contracts.
PRINCE2 refers to the organization that There may be one single customer with a prime
commissions a project as simply ‘the business’, contractor, or, at the other extreme, multiple
which is also referred to as the ‘business layer’, customers and multiple supplier organizations.
or ‘commissioning authority’, and it is from
here, that the business decision-makers will In this situation, it must be noted that each
come, who understand the organization’s customer, and indeed supplier, has their own
strategy, objectives and policies. business reasons for undertaking the project.
Put simply, the customer wants benefits which
The business provides the project’s mandate outweigh the cost of getting them, and the
and is also responsible for governing the supplier wants to make a profit out of the work
project and realizing the project’s benefits. it has agreed to do for the customer.
A project can be standalone which means it
operates outside the governance structure of a
programme or portfolio. S2-1P6: Project Context – Delivery method
and scale
Alternatively, it can be part of a programme and Tony:
is therefore subject to the governance, Karen, would you mind outlining two further
structure and reporting requirements set by the elements of the ‘project context’ integrated
programme. element of the PRINCE2 method please?
A programme is a group of interrelated projects Karen:
which progressively deliver outcomes of benefit No problem, Tony. Firstly we have the area of
related to the businesses’ objectives. a project’s ‘delivery method’. This is the way
Finally, a project can be part of a portfolio the work of the project is to be delivered,
which is the totality of an organization’s choosing from delivery approaches.
10
These include linear-sequential approaches, Others though may regard sustainability in

often referred to as waterfall, where delivery terms of the whole life costs of products
steps such as requirements gathering, design delivered by the project and their resilience in
and build occur in a sequence, for example in a operational use.
construction project.
Either way, PRINCE2 has roles,
Another approach available to a project might documentation, practices and processes to
be the iterative-incremental approach, which is address sustainability as a performance target.
often referred to as Agile, and most famously, The business case for a project, with its
Scrum. sustainability targets section, along with the
sustainability management approach in the
Here iterative cycles of requirements PID, would be examples of management
gathering, design, development and testing products which reflect the need to build
occur throughout a project’s lifecycle. sustainability into the project.
Alternatively, another delivery approach Tony:
available could be the hybrid approach, which That’s great Pete. And, just to conclude,
might be thought of as a combination of the two PRINCE2’s practices chapters, of which there
previous approaches, sometimes referred to as are seven, all have an ‘Applying the Practice’
‘Wagile’. section which examines organizational context,
commercial context, sustainability and scale for
The key thing to note is that a project can use
the practice in question.
a variety of delivery approaches within the
same project, dependent on the needs of each For example, section 5.4 for the Business case
stage. This is perfectly possible as PRINCE2 practice.
separates the management of the project from
the specialist work to deliver the project’s
products.
S2-1P8: Activity
Next, in terms of ‘project context’, we consider Tony:
the scale of a project. It’s important to note that Which are characteristics of a project:
the PRINCE2 method can be used for simple
projects, but also expanded for large or A. It brings about change in the form of
complex projects. outcomes
B. BAU is an important part of a project
PRINCE2 can be tailored to suit the scale and C. It is an on-going activity
size of a project, and we’ll examine this later D. It uses cross-functional skills.
when considering the principle of ‘Tailor to suit
the project’. Choose your answer from the following:
1. A and B
2. B and C
S2-1P7: Project Context – Sustainability 3. C and D
Tony: 4. A and D.
Finally, with regards to the ‘project context’
integrated element, we will briefly consider the
context of ‘sustainability’. Pete, could you take
S2-1P9: Activity
us through this please?
Tony:
Pete: Identify the missing word in the following
Well, as noted earlier, sustainability is one of sentence.
the seven aspects of project performance to be
PRINCE2 is an integrated method of principles,
managed.
people, practices, [?] and the project context
Typically associated with the environment, that address the planning, delegation,
sustainability encompasses the 17 UN monitoring and control of all these seven
development goals, which can be seen on aspects of project performance.
screen now.
1. Techniques
Some projects have sustainability as their very 2. Processes
purpose, such as a project to install a solar 3. Activities
panel farm on unproductive land. 4. Structures.
11
S2-1P10: Activity • Ensure continued business

Tony: justification
How many aspects of project performance • Learn from experience
must be managed? • Define roles, responsibilities and
relationships
1. 4 aspects
• Manage by stages
2. 5 aspects
• Manage by exception
3. 6 aspects
4. 7 aspects. • Focus on products
• Tailor to suit the project.
Pete, please tell us about the first three, and

S2-1P11: Activity then Karen, I’d like you to take over.
Tony:
Identify the missing words in the following
sentence. S2-1P13: Ensure Continued Business
PRINCE2 defines a project as “a temporary Justification
organization that is created for the purpose of Pete:
delivering one or more business products PRINCE2 is based on established and proven
according to an agreed [?]”. practice and as such requires that all projects
have a business case.
1. Project plan
2. Set of user requirements This ensures that there is a justifiable reason
3. Business case for starting the project, and that justification
4. Project mandate. must remain valid and be revalidated
throughout the project’s lifecycle.
A project should not be started without a

S2-1P12: PRINCE2 Principles – Introduction suitable business case and if the business case
Tony: becomes invalid, the project should be
PRINCE2 is suitable for any project, regardless stopped.
of type, size, complexity, importance, level of
risk or delivery approach. In short, the business case drives decision-
making.
It is also designed to help projects be
successful whilst at the same time avoid It ensures that the project remains aligned with
unnecessary bureaucracy and its practices, the intended benefits, and that realization of
processes and product descriptions describe them will contribute to one or more business
what should be done but, in general, not objectives.
prescriptive about ‘how’. Without this rigour it is likely that projects with
Having said that, all practice chapters contain a duplicate objectives will be started, or with
section for techniques applicable to that area, objectives which are not aligned to the
some of which are essential to PRINCE2, such business strategy, or projects which may be
as the ‘product-based planning’ technique for justified by the same set of benefits, which, are
the Plans practice for example. in effect, being claimed multiple times.
You can find these in the ‘point 3’ part of each When a project is undertaken to meet the
practice chapter, ranging from 5.3, techniques needs of legislation or regulation, which is
applicable to the Business case practice, to compulsory, the business case ensures that the
11.3, techniques applicable to the Progress best value for money solution is chosen.
practice.
The PRINCE2 method is flexible enough to be S2-1P14: Learn from Experience

used on any project, and rather than being Pete:
prescriptive about exactly what you need to do We have already discussed the fact that
to align to the method, PRINCE2 instead offers projects are unique and involve a temporary
guidance through seven principles, allowing team. This means that the team may not have
project teams to decide how PRINCE2 is used had any prior experience of projects like the
on their particular project. one being undertaken.
The PRINCE2 principles are:
12
By reviewing lessons from other projects which • Business sponsors, who endorse the
are similar in nature we can avoid many objectives and ensure the project
problems. provides value for money
• Users, who will be using the products
During a project, we record what went well and to generate benefits, usually after the
what didn’t go well. From these records we project is completed, and
can identify the cause and effect and can then
• Suppliers, who provide the resources
state the lesson.
and expertise needed to undertake
A lesson is something we must do the same the project work and these can be
such as use a certain technique which worked internal or external.
well before, or something we must do
All three stakeholder interests must be
differently to avoid a problem which occurred
represented in the project management team
before.
structure, as reflected in the Project Board.
So, we can learn from experience by reviewing
The structure unites the various parties in the
lessons from previous projects when we start,
common aims of the project and for each team
we can learn throughout the project, applying
member answers the question “what is
lessons from previous stages to the work in
expected of me?”.
subsequent stages, with the goal being to
implement improvements as we deliver the This principle also considers the internal
project and when the project comes to an end relationships between the stakeholders working
and we evaluate the project we can note within the temporary project management
lessons from our project to pass on to others. team, but also the external stakeholders who
are impacted by the activities of the project.
The basis for learning is then good quality data,
Both require the use of effective
its subsequent analysis and the insights that
communication channels, and bidirectional
can be gained and applied throughout the life
engagement.
of the project, and left as a legacy to future
projects. Karen, please can you take us through the
remaining principles.
Everyone has a responsibility to look for
lessons rather than wait for others to provide
them.
S2-1P16: Manage by Exception
Karen:
Thanks Pete.
S2-1P15: Define Roles, Responsibilities and
Relationships Manage by exception is our next principle, it
Pete: means that authority to work within specified
Projects are run by people and it is vital that limits is delegated through the project team
everyone knows what is expected of them structure. These limits are known as tolerance.
throughout the project. ‘people’ is also one of
the five integrated elements of the PRINCE2 This means that if the project is proceeding
method, and we’ll explore this in more depth in within the defined tolerances there is no need
the next session. for regular update meetings. This is particularly
important for the Project Board who need only
For now though, we know many projects meet to make decisions at the end of a stage.
involve a number of cross-functional skills and
these often come from different organizations Tolerances are set for each aspect of the
and to be successful all these groups must be performance as follows:
represented on the project team.
Cost: The allowable under or overspend
All these groups and individuals are known as against the budget for the project stage or work
stakeholders. Stakeholders are those who can package, usually expressed as a percentage.
affect, or be affected by, or perceive
Time: The amount of time either side of the
themselves to be affected by the project. You
could also say they are interested in it, and target date within which the project, stage or
have influence over it, to add to the standard work package can deliver.
definition. Scope: The allowable variation in a project’s
outputs, for example differentiating between
There are three primary stakeholders which, as
must-have and should have requirements.
we noted previously, are:
13
Quality: The variation in quality, for example a reduce effort for senior management, but offer
diver’s watch should work whilst swimming at a less control.
depth of 50 metres, plus or minus 5 metres.
Other factors that influence the choice of
Risk: The limits on the plan’s aggregated risk stages in a project would be - sector standards,
for example less than 10% of the project business policies and where significant
budget. decisions are needed in the project, usually
before we make a major commitment, for
Benefits: The degree to which it is allowable to example awarding a contract.
under or over deliver the benefits. For
example, a cost saving is expected of £50,000
plus or minus £5,000, and finally
S2-1P18: Manage by Stages – 2
Sustainability: Tolerance around sustainability Karen:
of the project’s product, or project activities, for Managing by stages provides several
example, a new production line that operates advantages which include:
within 5% of an emissions target.
• Giving the Project Board the
The aim is to alert the next management level opportunity to assess the project’s
in the project as early as possible that the work viability and defined intervals
is forecast to move outside of agreed • Making sure key decisions are made
tolerances, and a decision is needed on if, and before the work starts, for example
how, to proceed. awarding a contract
• Clarifying the impact of external
influences on the project before the
S2-1P17: Manage by Stages – 1 go-ahead is given. This could be
Karen: finalization of legislation or corporate
I’ll now outline the next PRINCE2 principle budget-setting, and finally
which is Manage by stages. PRINCE2 breaks • Facilitating the Manage by exception
work down into discrete sequential sections principle by delegating authority to the
known as stages. Project Manager on a stage-by-stage
basis.
These are defined as: ‘The section of a project
the Project Manager is managing on behalf of We will consider the detailed aspects of stage
the Project Board at any one time.’ planning later in the course.
At the end of a stage the Project Manager will

need to provide information to the Project
S2-1P19: Focus on Products
Board to enable them to review how well the
Karen:
current stage has gone, in the form of an end
PRINCE2 has a further principle which focuses
stage report accompanied by the updated
on the definition and delivery of products, and
business case and project plan, which is
their user quality expectations and
presented alongside the plan for the next
requirements.
stage.
The words, “outputs” and “deliverables” are
They can then make a decision whether or not
also used instead of products and mean the
to allow the Project Manager to proceed, as the
same thing.
Project Board authorises one stage at a time.
A product is defined as an input or output,
In other words, we will plan the project, so we
whether tangible or intangible, that can be
do a little work, review, do a little more, review
described in advance, created and tested.
and so on, until it’s finished.
PRINCE2 has three types of products:
PRINCE2 requires at least two stages which
are the initiation stage and the rest of the • Management products - which are
project, or we could call them “thinking” and often documents required and created
“doing”. to manage the project
The number of stages will depend on the size • Specialist products, which are those
and complexity of the project, so, for example, things that will be created by the
shorter stages offer more control, but more project to satisfy the user need, and
management overhead in the form of more end finally
stage assessments, whereas longer stages
14
• The project product, which describes

the total output from the project as
defined in the project product The project initiation documentation, or PID,
description. should describe how PRINCE2 has been
tailored so everyone is clear about how
By focussing on products PRINCE2: PRINCE2 is being used on the project.
• Ensures that the project only If tailoring is not actively undertaken, then there
undertakes work that directly is likely to be a “mechanistic” approach where
contributes to the delivery of a product the method is followed without question and
• Helps manage uncontrolled change or becomes over bureaucratic or, at the other
“scope creep” by ensuring that all extreme, where PRINCE2 isn’t really followed
changes are reviewed in terms of their at all, and hence there is insufficient control
impact on the project's products and and governance, it becomes a case of “heroic”
business case, before being accepted project management.
and incorporated into the project, or
Tony:
not, and
Thank you both for that very clear explanation
• Reduces the risk of user complaints
of the principles. We have prepared short
and acceptance disputes by clearly
exercise on the next page for you to try.
establishing what will be delivered at
the start of the project.
PRINCE2 uses product descriptions to clearly S2-1P21: Activity

define the product and we’ll consider these Tony:
later in the course. An accessible PDF version of this activity can
be found in Course Resources, which can be
Generally, in PRINCE2, when the book uses
accessed from the course menu or by selecting
the term ‘product’ it refers to specialist
Ctrl, Alt + R on your keyboard.
products, whereas project product refers to the
specialist and management products created On the screen, you will see the seven
during the project. principles and a number of statements, each of
which supports a principle.
Drag each statement onto the appropriate

S2-1P20: Tailor to Suit the Project
principle.
Karen:
As we mentioned earlier PRINCE2 is designed When you are satisfied with your choices click
for use on any project in any environment, but ‘submit’ to check your answer.
different projects need different levels of rigour
and governance. The principles are:
Therefore, if the application of PRINCE2 is to • Ensure continued business

be effective it must be tailored to suit the justification
project in question. • Learn from experience
• Define roles, responsibilities and
The purpose of tailoring is to ensure that: relationships
• The method and its use is appropriate • Manage by stages
to the project, for example aligning to • Manage by exception
business processes for human • Focus on products
resources and finance that influence • Tailor to suit the project.
who the project is governed and
The supporting statements are:
supported, and
• The project controls are appropriate to • S1 - In the last stage, we used the
the project’s complexity, importance, internal bulletin board very effectively.
team capability and risk. • S2 - The suppliers are clear about
how they fit into the team.
The Project Board and the Project Manager
must actively choose and decide which aspects • S3 - The quality specifications for the
of PRINCE2 are most appropriate. tender documents are clear and
measurable.
It is important to remember that effective • S4 - The benefits of the project
project management needs information, not outweigh the cost and risk of doing the
necessarily documents and decisions, not project.
necessarily meetings.
15
• S5 - The stakeholders know exactly • Progress which answers the questions

what will be delivered. “where are we now, where will we be
• S6 - The tolerance for this work and should we carry on?”
package is plus or minus 5 days.
• S7 - In the last project, we found that
newsletters had little effect. S2-1P23: Processes
• S8 - The Project Board will review Tony:
whether to continue with the project at The PRINCE2 processes describe the activities
the end of a stage based on whether required to direct, manage and deliver a project
the benefits are still being realised. successfully.
• S9 - This project is very high risk, we
need more decision points. There are seven Processes which are:
• S10 - We can use informal quality
reviews for this project because it’s • Starting up a project, or SU, which
not too complex. answers the question “do we have a
viable and worthwhile project?”
• S11 - At the end of the tender process
we must decide whether to go ahead • Initiating a project, or IP, which is
with appointing the main contractor. about establishing solid foundations
• S12 - The Project Board are delighted for the project
they are only meeting to make • Controlling a stage, or CS, which is
decisions. used by the Project Manager to
allocate work and monitor and control
• S13 - The project has all three primary
progress
stakeholders, business, user and
supplier represented. • Managing product delivery, or MP,
used by the delivery teams to accept
• S14 - The project must adhere to the
customer’s strict accounting and the work, report back to the Project
finance procedures which have formal Manager, complete it, and hand it
back
gates to work through.
• Managing a stage boundary, or SB,
used by the Project Manager to plan
the work of the next stage, and report
S2-1P22: Practices on the success of the current stage
Tony: • Closing a project, or CP, used by the
PRINCE2 practices describe those aspects of Project Manager to handover the
project management that must be continually project’s products to the customer and
addressed throughout the project. close the project, and finally
There are seven practices which are: • Directing a project, or DP, used by the
Project Board to make decisions and
• Business case which answers the provide advice and guidance.
question “why are we doing the
project?”
• Organizing which answers the S2-1P24: Tailoring and Adapting PRINCE2 –
question “who is involved and what 1
are their responsibilities?” Tony:
• Quality which answers the question As we’ve seen when discussing the seventh
“what are the quality requirements for principle of PRINCE2, Tailor to suit the project,
the products and how will they be PRINCE2 is designed to be applied and
judged?” tailored to meet the needs of any project.
• Plans which answers the questions
“what are the products, how will they The aim of tailoring is to provide the
be developed, when will they be appropriate levels of control and governance
developed and how much will it cost?” without it becoming overly bureaucratic and
• Risk which answers the question time consuming.
“what may or may not happen that
How PRINCE2 is actually tailored depends on
might affect the project’s objectives?”
the nature of the project, and external and
• Issues which answers the question
internal factors to the organization.
“what now? in terms of the impact an
issue will have, or is having, on the As can be seen on screen, external factors
project and how will it be dealt with?” include industry specific laws, methods,
and finally techniques and terminology.
16
Conversely, factors internal to an organization, S2-1P26: Activity

would include areas such as organizational Tony:
culture, business policies, and business Can you identify two of the three types of
strategy. product?
Project factors would include areas such as the A. Outcome

scale and complexity of the project, together B. Specialist
with the capability of the project management C. Management
team, and contractual arrangements that may D. Dependency.
need to exist, perhaps with suppliers.
Please choose from the following answers:
In turn, these three factors, external, internal
and project, will collectively influence the 1. A and B
tailoring of the method. 2. B and C
3. C and D
This in terms of changing the method regards 4. A and D.
use of terminology for example, to reflect the
standards used in the industry section in
question, or using alternative techniques or
S2-1P27: Activity
procedures for Risk or Issue practices, which
Tony:
reflect internal factors such as business
Which practice gives the answer to the
policies on these areas.
question “why are we doing the project?”
Such policies may differ from the default
1. Organizing
techniques suggested by PRINCE2.
2. Issues
3. Business case
4. Progress.
S2-1P25: Tailoring and Adapting PRINCE2 –
2
Tony:
S2-1P28: Activity
Once tailored, its subsequent application, or
Tony:
use of the method, will then reflect the project,
Which principle is supported by the Quality
internal and external factors, for example, in
practice?
terms of the assigning of roles in that particular
project’s organization structure. 1. Ensure continued business
justification
The main thing is that PRINCE2 is designed to
2. Learn from experience
be tailored, and provided the seven principles
3. Manage by exception
are adhered to, then PRINCE2 is being used
4. Focus on products.
effectively.
Tailoring arrangements for a specific project will

reflect the applicable project context, which if S2-1P29: Activity
you remember included organizational, Tony:
commercial, delivery approach and Which of these is another word for a “product”?
sustainability considerations.
1. Output
The actual tailoring for a specific project will be 2. Change
recorded by the Project Manager in the project 3. Yield
initiation documentation, or PID, for short. 4. Productivity.
Furthermore, further tailoring considerations
can be found in the final part of each process
chapter in the ‘Applying the Process’ section, S2-1P30: Summary
plus in the practices chapters, which have Tony:
guidance on ‘Applying the Practice’ in terms of We’ve now concluded our discussions about
the project context areas. the overall structure of PRINCE2, and four of
its five ‘integrated elements’ - its principles,
On the next page, we have prepared a few practices, processes and the project context.
multiple-choice questions for you to test your
understanding. Discussion on the remaining fifth integrated
element of the PRINCE2 method, that of
‘people’, will be the focus of the next session.
17
You should now be able to:
• Identify the PRINCE2 definition of a

project
• List and explain the 7 principles which
underpin PRINCE2
• List and describe the 7 processes and
the 7 practices of PRINCE2, and
• Understand the external, internal and
project factors which influence the
application and tailoring of PRINCE2,
and that, provided the seven
principles are adhered to, PRINCE2 is
still being used effectively.
This concludes this session.
18
Session 2-2: People
Session 2-2: People by the change, and involved in the temporary

structure bringing about that change.
S2-2P1: Introduction
Tony:
Welcome to this session on the topic of S2-2P3: Ecosystems and the three Project
‘people’, which, if you remember from the Interests – Business, User and Supplier
previous session, is the fifth ‘integrated Tony:
element’ of the PRINCE2 method. Pete, would you mind exploring the relevance
of the three primary stakeholder interests to the
During this session we will:
concept of project and organizational
• Examine the organizational and ecosystems?
project ecosystems
Pete:
• Think about those who are affected by
Yes, no problem, Tony. Well, if you remember
the project and the importance of
session 2-1, we mentioned stakeholders,
change management, and
noting that the project board for instance, who
• Consider the need to lead teams are internal to the project, are still regarded as
effectively, and how differing primary stakeholders.
organizational cultures can affect this.
Let’s begin. Here’s a definition on screen again to remind
ourselves:
Indeed, if we think back to the ‘project context’

S2-2P2: Organizational vs Project integrated element of the PRINCE2 method,
Ecosystems one part of this was the ‘organizational context’,
Tony: which introduced the interests of business, user
Karen, could you please outline the distinction and supplier.
between organizational and project
ecosystems? You can see these mapped onto the diagram
as follows, noting that the three interests are all
Karen: considered part of the project, and therefore
Of course, Tony. Well, first of all, consider the the ‘project ecosystem’, but also overlap with
organizational ecosystem, what some would the ‘organizational ecosystem’, particularly with
call, ‘business as usual’, or the normal, regard to the business interest, with its concern
permanent, elements of an organization which over alignment to business objectives.
are arranged to deliver against business
objectives. This is defined as being: Notice that the supplier interest overlaps here,
noting that suppliers could come from within
“The internal elements of an organization the customer’s ‘business as usual’
(including staff, board, owners, and other organizational ecosystem, for example, an
stakeholders) together with the organization’s internal IT department with developers, plus
external relationships such as customers, also recognising the definition of this
partners, suppliers, regulators, and organizational ecosystem, also references
competitors”. relationships with suppliers.
Compare and contrast this then to the project ‘Users’, are often in the permanent organization
ecosystem, this being the temporary structure as those who ‘require’ something,
organizational structure formed to deliver which, when delivered to the correct quality
products, which, when used, will hopefully lead specification, will hope to gain outcomes and
to outcomes, and subsequently benefits benefits from their use in ‘new’ business as
aligned to business objectives. This is defined usual.
as:
They are therefore shown, again, straddling
“Those elements of the business involved in or both the organizational ecosystem and the
directly impacted by the project and the temporary project ecosystem.
associated users and suppliers”.
Tony:
The key here, is the definition also references That was great Pete, thanks.
those impacted by the change, and not just
involved in making the change happen.
Tony: S2-2P4: Project and Organizational Culture

And, of course, we must note that there will be Tony:
people in both camps, namely those affected Talk of organizational and project ecosystems,
19
Session 2-2: People
for me at least, automatically leads into S2-2P5: Change Management – 1

consideration of ‘culture’. Tony:
So, if we are in the business of getting benefits
I always remember that quote from Peter on a project, we’ve got to make a change ‘stick’
Drucker…’culture eats strategy for breakfast’ as it were. This very much leads us to
which underlines the importance of a culture consideration of the concept of ‘change
which supports the achievement of business management’.
objectives and doesn’t detract from it. In a
project context though, we need to consider Pete, would you mind developing this please?
this further.
Pete:
Karen, would you mind developing this? Yes, no problem Tony. What we are referring to
is the concept of going from the old way of
Karen: working, to the new way of working and
No problem Tony. Well, first of all let’s define managing the potential chaos in between.
what we mean by ‘culture’. You can see this on
screen now. The inference is that project teams may
sometimes be guilty of delivering on time, on
Initially the culture in the temporary project budget, and even to the right level of quality,
ecosystem will reflect that of the organization, but had little consideration of whether the thing
which itself, may have quite differing cultures they delivered was actually used to its full
within separate operational areas or potential or not, in other words, whether you
directorates. got ‘bang for your buck’ so to speak.
The culture in the Human Resources What we can deduce from this is that
department, might be quite different from the implementing something which is considered
culture in the Finance department for instance, ‘fit for purpose’ in quality terms won’t
in terms of what is considered an accepted way necessarily guarantee the benefits.
of working and behaving in that particular area.
The definition of ‘change management’ can be
Therefore, the project might develop its own seen on screen now.
distinct culture, to ‘get the job done’ as it were,
perhaps emphasising a more collaborative, The key word to emphasise is transition, we
team-based culture, if lacking in the ‘normal’ have to go from somewhere, the ‘as-is’ or
organizational culture, which could be more current state, to somewhere, the ‘to-be’ or
siloed or driven by individual performance future state.
targets. It’s important though that there is no
‘disconnect’ between the project and the
organization.
S2-2P6: Change Management – 2
To ensure this does not happen, it’s important Tony:
that key influencers in the organizational Karen, can you talk more about what the
ecosystem are involved in helping to shape a definition of change management referred to as
shared understanding of the project, as initially ‘transition’?
agreed in the project brief’s listing of project
Karen:
objectives, and subsequently expanded upon in
Yes, no problem Tony. Transition is a word
things like the nine management approaches in
often associated with programme management
the PID.
by the way, and refers to seminal work by
Thereafter, such influencers from operational William Bridges, in his book ‘Managing
areas impacted by the project may take on a Transitions’.
decision-making role as part of the project
To make a change ‘stick’, we need to change
board.
routines, responsibilities, relationships, and
Likewise, those users affected by the proposed cultures, around the products delivered by the
project should be encouraged to get involved in project. Otherwise, even if the products work,
the project, such as involvement in helping to we won’t be using them to their full potential, if
set requirements, input to planning workshops, at all, in some cases.
or acting as quality reviewers as part of ‘quality
Current to future state is often found in
control’.
discussions around ‘Target operating models’
Tony: or ‘Blueprints’ in programme management. It
Thanks so much Karen. That was great. also links to the achievement of the vision
statement for a programme, which you might
20
Session 2-2: People
find being referred to as the End Goal, or End Tony:

State. That’s great Pete, and you can see the
elements of the change management
PRINCE2 though is making the point that a approach, which is part of the project initiation
project could be standalone and therefore it will documentation, assembled in the ‘Initiating a
need to undertake change management project’ process.
activities. These would normally be handled at
programme level by the Business Change
Manager and their supporting change agents or S2-2P8: The Power of Relationships
change champions. Tony:
This talk of the need for change management
Tony: to get us to the target organizational state,
That’s right Karen. Old to the new, a bit like makes me think about the importance of
business analysts who map the current stakeholder engagement.
business process, and then develop the ‘to be’
future process map by collaborating with Karen, can you take us through that, noting
operational teams. we’ve mentioned stakeholders a few times
now, especially around the ‘Define roles,
Be it at programme or project level, you’ll also responsibilities and relationships’ principle.
need to think about states between the current
and future states, often referred to as ‘interim’ Karen:
states, which would outline what you would No problem, Tony. We can’t forget that to get
expect to look like at the end of a stage in a to the ‘target organizational state’, we need to
project, or a tranche in a programme. make the change stick, and to do this, we need
to get people on side, listen to their concerns
and get them to help shape the change, rather
S2-2P7: The Change Management Approach than them feeling it is being ‘done’ to them.
Tony:
So, we know change management isn’t just a Humans are not necessarily rational in their
programme consideration. Pete, would you perception of change. Notably, key influencers
mind outlining how PRINCE2 builds this into in operational areas impacted by a project
the project? could influence the perception of those
impacted by the change and also in the project
Pete: ecosystem itself.
Yes Tony. We do this by outlining a ‘change
management approach’ which is one of the Such influencers could include senior
nine approaches in the project initiation executives or those involved in day-to-day
documentation, or PID, for short. tasks and decision-making in business as
usual, plus also those who may be considered
Approaches are generally about ‘how’ you do a ‘bottleneck’ with regard to their technical
something, and ‘who’, in terms of generally who expertise. This means they perhaps hold tacit
is responsible for it. knowledge on how an impacted area actually
works practically, as opposed to how it should
In this particular case, the change management
do.
approach would need to consider areas such
as: As such, the project needs to understand the
relationships between itself and the
• The skills and capabilities required
organizational ecosystem, and the need
during and after the transition from
therefore, to understand key stakeholders,
current to target state
such as influencers, to ensure the change is
• Which areas of the ‘organizational
fully adopted and embedded.
ecosystem’ are likely to be impacted
by the project Stakeholders will change over the life of a
• The key relationships to be project, becoming more interested, or less
considered interested, as the project goes from stage to
• The evolving culture, and stage.
• How best to transition.
If a stakeholder was given ownership of a key
On the last point, we’d be referring to the need risk faced by the project, their interest and
to transfer, possibly tacit, knowledge from the influence would increase, for example.
project team to the new ‘target’ business
Either way, the project needs to think about the
operations, or perhaps the need to upskill
interface with the organizational ecosystem,
existing members of staff or recruit new ones
ensuring that different perspectives on the
and so on.
potential project are not ignored, but rather
21
Session 2-2: People
listened to and built into the early establishment stakeholders don’t get the ‘wrong end of the
of the project. stick’, which could lead to misinformation and
rumours.
Tony:
That’s great Karen, thank you.
S2-2P10: Leading Successful Teams

Tony:
S2-2P9: Communications and Bidirectional Finally, in our consideration of the ‘people’
Flows of Information integrated element, we need to consider the
Tony: people working as part of the temporary project
We mentioned the importance of understanding management team, possibly across multiple
the relationship between the project and the organizational boundaries.
interfaces in the organizational ecosystem, be
they impacted staff, or key decision-makers. Karen, would you mind elaborating on this for
us?
Either way, effective, so-called, ‘bidirectional’
communication which encourages feedback Karen:
could be considered key here to avoid No problem at all Tony. Well, what we are
misconceptions around the purpose of a project really talking about here is the power of the
leading to barriers being put in its way. team over the power of the individual.
Pete, could you expand on this please? ‘Star’ players are not the focus, but rather,
people in the team collaborating, and bringing
Pete: their respective strengths and perspectives to
Yes, no problem. Well, ‘bidirectional’ indicates add value.
it’s as much about listening, as it is about
broadcasting messages from the project. Collaboration is defined as “People from across
the project ecosystem working together to
Listening to thoughts about the proposed achieve the project’s objectives”.
project, or to feedback once the project has
started to deliver, is key to allowing messaging It would be fair to say a Project Manager is
being targeted, to hopefully allay such fears. skilled at the ‘art of calling in favours’, and that
a different style of leadership and management
Key influencers in the business, user and is required from that needed in traditional
supplier stakeholder groups need to be organizational settings.
identified, to ensure the different perspectives
on the project all have input. The reason for this is that the people working
within the temporary project management team
In view of this, generic messaging from the structure may be working on multiple projects,
project is usually unsuccessful, especially given have ‘day jobs’, with their own reporting lines,
the interconnected digital landscape. and in the context of a project, you, as Project
Manager, may be exerting control on someone
Many channels for communication exist, so it’s
who is on a ‘higher pay grade’.
probably beneficial to not rely solely on one
channel, but rather, provide information in Multiple reporting lines then are common, so
multiple formats to enable sharing of it’s important that the Project Manager tries to
information, and multiple options for providing motivate and influence people involved in the
feedback. project through, perhaps, shared interests, and
not just the shared purpose of the project.
Tony:
Yes, they often say Pete, that ‘feedback is a Tony:
gift’, even if it’s not what you want to hear. In Absolutely, Karen. You can see definitions of
reality, less formal channels, like having an leadership and management on screen here.
unexpected chat in the corridor, or at an
unrelated Zoom meeting, might be the reality of
how many stakeholders are engaged. S2-2P11: Co-creation
Tony:
On screen now are the contents of the The definition of management references
communications management approach, which something called ‘co-creation’.
is one of the nine approaches found in the PID.
Pete, can you expand on this please?
Remember though, early in the project
lifecycle, when little is known about the Pete:
proposed project, and it is still taking shape, it’s Well, to ‘co-create’ something, it implies
probably best to have a ‘quiet phase’ to ensure involving others, rather than the Project
22
Session 2-2: People
Manager being ‘locked in an ivory-tower’ working has been decommissioned

arrogantly thinking they know best. appropriately, and the new way, fully adopted.
Co-creation can be found throughout the As such, the Project Manager needs to
PRINCE2 method, for example, involving a recognise that there will always be people over
team of people with differing perspectives to whom they do not have direct authority,
create project and stage plans, or to assemble possibly across organizational boundaries, and
the project brief. for this, they will require so-called ‘cultural
intelligence’.
This will ensure, for example, the supplier
perspective is not forgotten with regard to the This is defined as being “the capability to relate
design of the plan in question. and work across cultures within the
organizational ecosystem”.
Likewise, involvement of business, user and
supplier perspectives in co-creating products, People from different organizational
will increase the chances of adoption, and ecosystems, perhaps on partnership type
reduce the potential for handover disputes. projects, or both the customer and supply side,
will potentially be involved in a project, even if
Tony: in a more limited way.
Thanks Pete. Yes, co-creation is something
you see throughout the PRINCE2 book with As such the Project Manager needs to be
regard to, for example, the Project Manager co- aware of the different cultures involved, and the
creating the full business case in the ‘Initiating different ‘pulls’ on people’s time and attention.
a project’ process with the Project Executive.
Tony:
Likewise, the Project Manager will co-create Thanks Karen.
and review the instruction for work, which we
call the ‘work package description’, with the
Team Manager in the ‘Controlling a stage’
S2-2P13: Building Effective Teams
process.
Tony:
Thereafter, the products themselves will be co- Earlier we said it’s all about the power of the
created by The Team Manager and team team over the individual.
members in the ‘Managing product delivery’
Pete, could you explore this a little more
process.
please?
Pete:
S2-2P12: Leading across Organizational Well, the first thing to note is that bringing
Boundaries teams together isn’t easy, especially in virtual
Tony: or hybrid environments. The Project Manager
We now have to think about who might be may have to think about novel ways of
involved in a project, but may not have a connecting, perhaps synchronizing co-location
defined role. days or offering incentives for team members
to meet face-to--face.
Karen, can you explore this for us please?
Also, a team will need a diverse range of skills,
Karen: competencies and perspectives to match the
Yes, no problem. Well, the first thing to note is requirements of the project.
that in addition to people who are formally
assigned to a role in a project, there will be Gaps in skills and competencies of those
those in an organization who don’t have a assigned to project roles need to be
formal PRINCE2 role but are performing a task understood, and mitigation put in place,
as part of the project. perhaps in the form of training, coaching or
mentoring.
Think of people from the user perspective for
example, who have a quality responsibility for Roles need to be assigned in view of the
accepting a particular product, to verify that it is capability, authority and availability of the
fit for purpose. person undertaking the work.
They may also be involved in the transition Recognition must also be made of the need for
work of the project, helping operational staff to project team members who have not worked
upskill, providing temporary support or with each other, to build trust.
guidance or ensuring that the old way of
The key to effective teams is that all members
feel accepted, respected, and able to express
23
Session 2-2: People
diverse viewpoints without fear of negative Let's move on to try a few multiple-choice
consequences. questions.
Diversity of opinion, and differing perspectives,

perhaps borne from differing team member
backgrounds and experiences, can be critical S2-2P15: Activity
to identifying emergent risks and issues for Pete:
example. Which of these would NOT be regarded an
element of the ‘people’ integrated element of
Tony: PRINCE2, underlining how ‘people are central
I couldn’t agree more Pete, we want to avoid to the method’?
the ‘fortress mentality’ of those working on a
project, where you are either ‘one of us’ or 1. Leading successful meetings
‘against us’. This is especially important when 2. Communication
escalating issues and risks, which is 3. Leading successful teams
considered good practice, and not failure, in 4. Leading successful change.
PRINCE2.
S2-2P14: How People Integrates with the S2-2P16: Activity

other Integrated Elements of PRINCE2 Karen:
Identify the missing word or words in the
Tony: definition of change management:
Finally, we need to consider how the ‘people’
element integrates with the other four Change management is the means by which
integrated elements. an organization [?] from the current state to the
target state
Firstly, with regard to PRINCE2 principles, the
obvious one to note is the ‘Define roles, 1. Evolves
responsibilities and relationships’ principle. 2. Continuously improves
3. Transitions
That’s not to say though that the ‘people’ 4. Avoids changing.
element doesn’t relate to the other six
PRINCE2 principles. For example, with regard
to the ‘Manage by stages’ principle, stages S2-2P17: Activity
often mark a change in the influencers and key Karen:
relationships as different stages often focus on Identify the missing word or words:
different things or have differing impacts on the
organization relating to the, so-called, ‘interim’ With regard to effective use of communication
states. channels on a project, generic messaging is
seen as [?].
With regard to the seven PRINCE2 ‘practices’,
the obvious one is the ‘Organizing’ practice, 1. The default, and usually best, channel
which outlines the roles and responsibilities in to use
PRINCE2’s temporary project management 2. Often effective
team structure. 3. Rarely effective
4. The most effective way of engaging
Furthermore, each practice chapter has a table stakeholders, who only tend to use
at the end called the ‘Focus of Key Roles for one channel to receive information.
the Practice’, which shows how the roles relate
to that particular ‘ingredient’ of PRINCE2, be it
Business case, Plans and so on. S2-2P18: Summary
Finally, with regard to the ‘processes’ integrated Tony:

element of PRINCE2, the layers in the lifecycle This brings to the end of the session on the
diagram, Business, Directing, Managing and integrated element of PRINCE2 - ‘people’.
Delivering are reflective of the three
organizational layers involved in the project, In this session we:
and the one above the project.
• Drew a distinction between the project
People-related factors such as behaviours, ecosystem and the organizational
culture and relationships are included in the ecosystem, noting an overlap between
seven processes, explaining how people the two in terms of the three primary
interface between the layers in the PRINCE2 stakeholders
organization structure. • Thought about how differing
organizational cultures may influence,
24
Session 2-2: People
or differ from, the culture on the

project
• Thought about the need for bi-
directional communication and a
communication management
approach, and
• Considered the need to lead and
manage the project team,
understanding the diversity and
competencies therein, and the
importance of co-creation and differing
perspectives.
25
Session 2-3: Processes and Practices Quiz
Session 2-3: Processes and • Directing a project (DP)

Practices Quiz • Controlling a stage (CS)
• Managing product delivery (MP)
S2-3P1: Introduction • Managing a stage boundary (SB)
Tony: • Closing a project (CP).
Welcome to this session where we’ll set the
scene for two key elements of PRINCE2.
The statements that relate to the processes
The first is known as the PRINCE2 journey and are:
the second is the management products
suggested by PRINCE2. • S1 - Triggered by the project mandate
• S2 - Used by the Project Manager to
The PRINCE2 journey will take you through the authorize work packages
project lifecycle and explains how we move • S3 - Team Managers and team
from one stage to another. members work in this process
• S4 - Here we plan post-project
PRINCE2 has a number of management benefits reviews
products which are used by the team to
• S5 - Assemble the project initiation
manage the project. It is very important that
documentation
you learn to recognise the purpose of each
• S6 - Used by the Project Board to
product for your Foundation examination.
make decisions
You can download and print both documents • S7 - After the initiation stage the
required for this session, using the buttons business case is reviewed and
shown on screen. You can also find these updated with the latest information.
documents in Course’s Resources tab which
can be accessed from the course menu, or by
S2-3P3: Activity
selecting Ctrl, Alt and R on your keyboard. You
Tony:
may find it useful to keep these documents to
Continuing our revision activities, again drag
hand during your studies.
each statement onto the appropriate process.
Please take some time to study both When you are satisfied with your choices click
documents and then try your hand at the “submit” to check your answer.
quizzes and exercises on the following pages.
Again, if you want to review our feedback,
simply select each in turn.
S2-3P2: Activity
An accessible PDF version of this activity can
Tony:
be found in Course Resources, which can be
OK, at this point you should have taken the
accessed from the course menu or by selecting
time to study the content of the PRINCE2
Ctrl, Alt + R on your keyboard.
journey and the PRINCE2 management
products. The processes are:
So, time for some revision. • Starting up a project (SU)
An accessible PDF version of this activity can • Initiating a project (IP)
be found in Course Resources, which can be • Directing a project (DP)
accessed from the course menu or by selecting • Controlling a stage (CS)
Ctrl, Alt + R on your keyboard. • Managing product delivery (MP)
• Managing a stage boundary (SB)
On the screen, you will see the seven • Closing a project (CP).
processes and a number of statements, each
of which relates to a process. The statements that relate to the processes
are:
Drag each statement onto the appropriate
process. When you are satisfied with your • S1 - Assemble the project brief
choices click “submit” to check your answer. • S2 - The Project Manager plans the
detail of the next stage with help from
If you want to review our feedback, simply
Team Managers, team members,
select each in turn.
project assurance and Project Board
The processes are: members
• S3 - The Team Manager reports
• Starting up a project (SU) progress via a checkpoint report
• Initiating a project (IP)
26
Session 2-3: Processes and Practices Quiz
• S4 - Covers the Project Board’s Again, you can review your answers by
activities selecting them in the question reference matrix.
• S5 - The project’s performance is Green question numbers indicate a correct
assessed against its original project answer and those in red were marked
initiation documentation (PID). incorrect.
• S6 - The Project Manager checks the
If at any point you exit the quiz before
work is going according to plan
completion, you will have to restart from the
• S7 - Used in the first stage.
beginning.
Good Luck.
S2-3P4: Exercise
Tony:
This brings us almost to the end of this revision S2-3P6: Quiz
session, but before we conclude the session
with a short quiz, try your hand at one further
activity.
We have compiled a crossword puzzle for you

to try. All the clues are based on the PRINCE2
management products you will have seen in
the document you printed, or downloaded, at
the beginning of this session.
You can print or download the crossword by

clicking the view and print button shown below.
S2-3P5: Quiz Intro

Tony:
Welcome to the PRINCE2 Foundation quiz.
The quiz consists of a number of multiple-

choice questions which are randomly selected.
The following questions are on based on the

content of the PRINCE2 Journey document you
reviewed earlier.
There are 20 questions in total.
The quiz is timed and the pass mark is shown

on screen.
Once you begin the quiz, you will be presented

with a page that looks like this.
You will notice that the bottom portion of the

page contains a question reference matrix.
You can choose to answer the questions in

numerical sequence by clicking the forward and
back buttons, or you can select a question by
clicking its number in the matrix.
You can come back to any question you've

previously answered in the same way.
Once you are happy with your answers, you

can submit them for marking by selecting the
submit button - shown here.
At this point you will be given your score along

with feedback on which of your answers were
correct or incorrect.
27
Session 3-1: Practice: Business Case
Session 3-1: Practice: Business will also outline sustainability targets for the
project.
Case
S3-1P1: Introduction S3-1P3: Business Case – 2

Tony: Karen:
Welcome to this session about the business With regard to the business case lifecycle, in
case where we shall consider the justification of PRINCE2 the outline business case is
the project and the way we keep the business developed in the Starting up a project process,
case up to date throughout the life of the which is a response to, and based on,
project. information contained in the project mandate
from the business.
It is then further developed and refined to
• Explain the purpose of the Business
produce the full business case in Initiating a
case practice
project, and thereafter updated towards the end
• Explain the purpose of the business
of a stage in the Managing a stage boundary
case, the benefits management
process. It is then reviewed by the Project
approach and the sustainability
Board at each key decision point, such as end-
management approach
stage assessments.
• Describe the PRINCE2 recommended
technique for the business case, and The benefits are confirmed as they start to
also link that to the business case accrue, normally from the end of the project,
lifecycle. and but in some cases they may accrue as the
• Define the terms outputs, outcomes, products are released to the user community,
benefits, dis-benefits and business for example as part of a phased rollout of a
objectives. product in an iterative-incremental approach.
• Let’s make a start by considering the
purpose of the Business case The business case presents the optimum mix
practice. of information, which in turn enables the Project
Board to judge whether the project is:
Karen, can you get us started?
• Desirable - that the cost/benefit/risk
analysis is valid,
• Viable - that the project can deliver its
S3-1P2: Business Case – 1 products, and
Karen: • Achievable - that the product can
Thanks Tony. provide the benefits.
The first thing to remember is that in
accordance with the PRINCE2 principle Ensure S3-1P4: Outputs, Outcomes, Benefits, Dis-
continued business justification, any project benefits and Business Objectives – 1
should be driven and underpinned by a viable Tony:
business case. So, unless a satisfactory Let’s take a look at outputs, outcomes and
business case exists then a project should not benefits. Projects produce outputs or products,
be started. which are then used to change the business.
And if, during the course of a project, things The change in BAU is achieved by the users
happen that render the business case for the using the outputs to change the way they
project invalid, then the project should be operate. This new way of operating is called
aborted. In any event, the business case for a the outcome.
project should be routinely updated at each
stage end. As a result of the change or outcome, then
benefits accrue.
The business case is a description of the
reason for the project and the justification for its For example, a company develops a new
undertaking. It should provide a clear statement chocolate bar, which is the output. This is
of the benefits that are expected from the defined as being the tangible, or intangible
project and the costs, risks and timescales that deliverable of an activity.
are entailed in achieving those benefits.
The sales team sell the new bar, instead of the
Additionally, considering the other aspects of old one, which is the outcome. This is defined
project performance, in addition to benefits, as the result of change.
costs, timescales and risks, the business case
28
As a result, profits increase as the new bar has in the PRINCE2 journey to help the Project
a better profit margin, which is the benefit. This Board make decisions, Pete, would you mind
is defined as being the measurable developing this further please by outlining what
improvement resulting from an outcome PRINCE2 calls the ‘Technique’ for the
perceived as an advantage by the investing, or practice’?
commissioning, organization as we’d say in
PRINCE2 This would contribute to the Pete:
achievement of one or more business No problem, Tony. Well, like all the practices,
objectives. in the ‘point 3’ part of the practice chapter,
which in the case of the Business case practice
is section 5.3, you find a suggested technique.
S3-1P5: Outputs, Outcomes, Benefits, Dis- The technique, or business case management
benefits and Business Objectives – 2 procedure, suggested, but not mandated by
Tony: PRINCE2 has four steps – Develop, Check,
There may also be downsides to doing a Maintain and Confirm.
project which we call dis-benefits. These are
defined as the measurable declines resulting Note that all techniques suggested by
from an outcome, which would detract from one PRINCE2 are optional, so, for instance, if you
or more business objectives. had an alternative technique in use corporately,
you might prefer to use that.
For example, if a homeowner extends their
house by turning the attached garage into a This use of an alternative to the one suggested
living room, which means they have more living by PRINCE2 would be a form of tailoring, and
space, which is a benefit, they have also lost you’d record this in the final section of the
their garage, which is a dis-benefit. project initiation documentation, or PID. Use of
no technique however is not advisable.
Benefits are specified by the Senior User, who
will also make sure they are realized in the live
environment.
S3-1P7: The Business Case Technique –
The Project Executive is responsible for Develop Step – 2
ensuring that the benefits represent value for Tony:
money and that they are also aligned to the So, the first step in the suggested business
business objectives. case management procedure is to ‘Develop’.
Business objectives, be they ‘to decrease the ‘Develop’ means to explore options and get the
organization’s carbon footprint’, or ‘to increase right information on which investment appraisal
customer retention levels’ for example, decisions can be made.
demonstrate progress to an organization’s
By options, we mean ‘do-nothing differently’, in
mission, to which the project should contribute
response to the mandate’s problem to solve or
in some way.
opportunity to exploit. Essentially carry on as
The fear is that a project team is so focussed you are, even if there is an aggressive new
on the outputs, or products as we usually call entrant in your marketplace.
them in PRINCE2, but loses sight of the
‘Do-the minimum’ would be another option to
benefits which may come, in the majority, after
explore, as would ‘Do-something’.
the project has closed. The project team
therefore needs to understand the link from Early in the lifecycle there will be many options
how their outputs will lead to outcomes, which to explore, and these will reduce and be
in turn lead to benefits which help achieve one explored in more detail accordingly. The
or more business objectives of the business case would need to say why the
organization. chosen option was selected, namely the benefit
the investment in change will bring, and why
Visibility of this link is key, otherwise focus may
other options were rejected.
be lost and benefits not realized. This is the
fundamental reason for doing the project after The main bulk of the business case will then be
all. for the chosen option.
We also need to recognise that the chosen

option is the best mix of the seven aspects of
S3-1P6: The Business Case Technique –
project performance:
Develop Step – 1
Tony: • Time
We’ve alluded to the use of the business case • Cost
29
• Quality S3-1P9: The Business Case Technique –

• Scope Maintain and Confirm Steps
• Benefits Tony:
• Risk, and Following on from ‘Develop’ and ‘Check’, Pete
• Sustainability. can you please take us through the final two
steps of the business case procedure or
Understanding how these interrelate is key technique?
early on in a project, so, for example, higher
Pete:
quality expectations in the project product
Absolutely Tony. Well, ‘Maintain’ is simply
description may impact time, and take longer,
where the Project Manager updates the
cost more, and effect sustainability.
business case towards the end of a stage, in
the Managing a stage boundary process.
Benefits, costs, timescale and risks will all need
S3-1P8: The Business Case Technique – updating as progress has been made.
Check Step
Tony: Next comes the ‘Confirm’ step, and this is
Now we come to the next part of the suggested where the business will review the business
business case technique, or business case case as part of the post-project benefits review.
management procedure by another name. The
The business will assess whether the intended
step of ‘Check’.
benefits as stated in the business case, and
Karen, can you take us through this please? benefits management approach, were indeed
realized post-project.
Karen:
Yes, will do Tony. Well after the ‘Develop’ step, Benefit reviews should though have been
‘Check’ is where the business case is happening throughout the project, especially
continually assessed for desirability, viability with an iterative-incremental approach,
and achievability.
Given the benefits management approach is
This is because the business case does not reviewed and updated by the Project Manager
stand still, and will be updated stage-by-stage as part of the Managing a stage boundary
in terms of incurred costs, realized benefits, process, and here they will get an indication of
changed risks and potentially shifted whether forecast benefits have been realized
timescales. up to that point, and if not, whether
expectations need to be re-forecasted
It drives decision-making, and we associate accordingly.
decisions with the Project Board, so it’s
probably no surprise that the Project Board, Responsibility for specifying benefits expected
who are the key decision-makers, will check from the project is the role of Senior User, and
the business case: they, in turn, will be held accountable by the
business for confirming that the expected
• At the end of the Starting up a project benefits were realized post-project.
process to authorize initiation
• At the end of the Initiating a project This implies a responsibility post-project for the
process to authorize the project Senior User, even when the temporary team
has been disbanded, as the business asks for
• At the end of each stage to authorize
evidence that the expected benefits allocated
the next stage, or
to them have been realized, or not as the case
• When assessing an exception plan.
may be.
Likewise, the Project Manager, in the stage Tony:
itself, will check the business case when Thanks Pete. That was really helpful.
assessing the impact of new risks and issues
on the business case.
Also, in the last stage, the Project Manager will S3-1P10: Key Management Products –
check the business case as part of the Closing Business Case and Benefits Management
a project process, to assess how the project Approach
performed and what likelihood there is of Tony:
realizing the expected benefits. There are three products associated with the
Business case practice which are the business
Tony: case, benefits management approach, and
Thanks Karen. finally, the sustainability management
approach.
30
The purpose of the business case is to Well, one of the aspects of project performance
document the business justification for the is ‘sustainability’, and we’ll see later that the
project based on the estimated costs of business case ‘high-level content’ also includes
development, implementation and ongoing sustainability targets for the project.
operations and maintenance and the value of
the benefits. Furthermore, we have a sustainability
management approach in PRINCE2 which is
It should outline how and when the anticipated one of the nine approaches in the PID.
benefits should be measured.
Its purpose is to define the actions, reviews,
The outline business case is developed in and controls that will be established to ensure
Starting up a project and refined in Initiating a that sustainability performance targets for the
project. project are achieved.
The Project Board approve, and re-approve the Note that the accompanying business case
business case using the process Directing a contains ‘sustainability tolerances’ around
project. specific sustainability targets. This is a concept
that we’ll talk more about when discussing the
The business case is used when we assess the Progress practice later in the course.
impact of issues and risks during the project
stages, using the Controlling a stage process. For now though, we’ll say it’s the permissible
deviation in the sustainability targets that is
It is reviewed and updated at the end of each allowed before the deviation needs to be
stage using the process Managing a stage escalated to the next level of management.
boundary and at the end of the project using Provided you are forecast to remain within that
the Closing a project process. permissible deviation, you are allowed to
continue with the stage or project.
The benefits management approach defines
the actions and benefits reviews that are In the same way, the benefits management
required to ensure that the outcomes and approach documents guidance around the
benefits are achieved. detail of benefits tolerance, the permissible
deviation around expected benefits, which is
It is prepared during the Initiating a project
summarised in the accompanying business
process, and is also part of the project initiation
case.
documentation, or PID for short.
For example, increased sales revenues of
If the project is part of a programme, then the
£100m over the next five years, plus 10% or
benefits management approach may be
minus 5% either side.
contained within the programme benefits
realization plan and executed at programme Tony:
level. That’s great Karen. If you want to know more
about the high-level content in the sustainability
After the project has finished, the benefits
management approach, it’s shown on screen
management approach is executed and
now.
maintained by the business layer.
S3-1P12: The Business Case Practice: Key

S3-1P11: Key Management Products – The
Relationships with Principles of PRINCE2
Sustainability Management Approach and
Tony:
Tolerances
Finally, before we test our understanding with
Tony:
some multiple-choice questions, we will
We noted earlier that the project team needs to
consider how the Business case practice
understand the linkage from their outputs, or
contributes to the adherence to the seven
products by another name, to outcomes, to
PRINCE2 principles across the PRINCE2
benefits through to the achievement of one or
lifecycle.
more business objectives.
On screen you will see a table, which on the
These business objectives may include
left-hand side lists the seven principles.
environmental, social and governance (ESG)
goals set by the organization. Karen, can you The middle column shows how the business
elaborate please? case practice achieves the principle by doing
something.
Karen:
No problem Tony.
31
Finally, the right-hand column outlines how by 2. Whether the project can be delivered
doing something, this results in something within the estimated cost and time
beneficial for the project. budgets
3. Whether the project outputs can be
So, for example, the Define roles, produced to the quality specification
responsibilities and relationships principle is required
achieved by clarifying the responsibilities for 4. Whether use of the products is likely
developing and maintaining the business case to result in the envisaged outcomes
and benefits management throughout the and resulting benefits.
project
Resulting in… S3-1P16: Activity

Karen:
A clear understanding of expectations for the
We have extended our house. Which of these
business case and benefits management
is a correct example of a dis-benefit?
In short it shows how interconnected the
1. It cost £75,000
PRINCE2 method is.
2. The house value has increased by
It shows how one of the five integrated 35%
elements, a practice, relates to the 3. We have lost 25% of the available
achievement of principles, another integrated garden space
element, throughout the lifecycle, namely 4. The children each have their own
processes, which are another integrated room.
element.
S3-1P17: Business Case - High-level
Content – 1
S3-1P13: Activity Tony:
Karen: The main ‘high-level content’ sections that
Which part of the business case technique, or PRINCE2 suggests should be included in a
business case management procedure by business case are:
another name, is where the ‘do-nothing
differently’ option will be explored? Executive summary - this highlights the key
points in the business case, including the
1. Check important benefits and the return on investment
2. Develop (or ROI).
3. Maintain
4. Confirm. Reasons - describes the reason for the project,
for example, the problem to be resolved or
opportunity to be seized. It should also explain
S3-1P14: Activity how the project will enable the achievement of
Karen: business objectives.
Identify the missing word in the following
sentence: Business options - this includes analysis and
reasoned recommendation for the base
The purpose of the Business case practice is to business options of ‘do-nothing differently’, ‘do-
establish mechanisms to judge whether the the minimum’ or ‘do-something’. Other options
project is, and remains, [?], viable and may be included as required.
achievable as a means to support decision-
making in its continued investment. Expected benefits and dis-benefits - benefits
and dis-benefits expressed in measurable
1. Worthwhile terms against the situation as it exists prior to
2. Desirable the project. The measures include benefit
3. Justified tolerances.
4. Appropriate.
Sustainability targets – specific targets relating
to sustainability that the project must meet. The
S3-1P15: Activity targets include sustainability tolerances.
Karen:
Which of these statements correctly defines Time - this refers to the actual project duration,
“achievable”? from the creation of the project plan to the
period of the benefits realization.
1. Whether the balance of costs, benefits
and risks is justified Karen, would you like to continue?
32
S3-1P18: Business Case - High-level The Project Board in Directing a project will use
Content – 2 the detailed business base as part of their
Karen: considerations when authorising the project.
Thanks Tony.
The business case should also include sections

on: S3-1P20: Business Case Development – 2
Tony:
Costs - a summary of the project costs. Costs If you remember the ‘Check’ step in the
also include the ongoing costs of operations, business case technique, or business case
maintenance and their funding arrangements. management procedure by another name, the
business case will evolve over time as more
Investment appraisal - compares the becomes known about the project.
aggregated benefits and dis-benefits with the
costs of the project and the ongoing operational Consequently, the business case must be
and maintenance costs. There are many checked by the Project Board...
techniques which could be used to develop the
investment appraisal, such as return on • At the end of Starting up a project in
investment, net present value, sensitivity order to authorize the initiation of the
analysis and so on. These are outlined in project
section 5.3.2 ‘Supporting Techniques’ • At the end of the Initiating a project
process in order to authorize the
Major Risks - a summary of the key risks, project
together with their likely impact and responses, • At the end of each stage to authorize
and finally the next stage and the continuation of
the project, and
References – for any associated documents or
• In tandem with the exception plan in
products, for example the project brief which
order to authorize the revised stage
contains the outline business case.
and the continuation of the project in
the event of an exception at stage or
project level.
S3-1P19: Business Case Development – 1
Tony: The business case is also checked by the
Earlier we briefly mentioned the business case Project Manager…
lifecycle, which essentially was a sequence
from mandate, to project brief, to full business • As part of the impact assessment of
case. Let’s explore it now in a little more detail. any new issues or risks, and
• During the final stage to assess the
It is the Project Executive’s responsibility to project’s performance against its
ensure that the project’s objectives, costs, and requirements and the likelihood that
benefits are aligned with the business the outcomes will provide the benefits.
objectives.
The business case will then be updated in the
The project mandate should contain some
‘Maintain’ step by the Project Manager as part
basic elements of the outline business case,
of the Managing a stage boundary process, to
but at this stage things may be quite sketchy
be subsequently checked by the Project Board
and incomplete.
in the Directing a project process.
During the Starting up a project process, the
Finally, the business case will be reviewed
information from the project mandate is used to
post-project by the business to ensure that the
develop the information required for the outline
intended benefits were indeed realized or not.
business case. At this stage the aim is to bring
the business case up to basic level, sufficient to
allow the Project Board to give approval to
initiate the project as part of the Directing a S3-1P21: Summary
project process. Tony:
We have now reached the end of this session
The Initiating a project process is where the on the Business case practice.
detailed business case is fully developed. It will
form part of the project initiation documentation You should now be able to:
and is derived from the outline business case,
project plan and the risk register. • Explain the purpose of the Business
case practice
33
• Explain the purpose of the business

case, sustainability management
approach and the benefits
management approach
• Describe the PRINCE2 business case
technique’s four steps, and business
case lifecycle, and finally
• Define the terms outputs, outcomes,
benefits, dis-benefits and business
objectives.
34
Session 3-2: Practice: Organizing
Session 3-2: Theme: Organizing those requirements are met, they will use the
outputs to create outcomes and benefits.
S3-2P1: Introduction The stakeholders who provide the skills and

Tony: collaborate to produce the outputs, or products,
Welcome to this session where we shall belong to the supplier interest.
consider the Organizing practice.
They can come from an external organization
By the end of this session you will be able to: or come from within the organization, or be a
mixture.
• Explain the purpose of the Organizing
practice
• Explain the purpose of the project S3-2P3: Levels of Organization
management team structure, role Tony:
descriptions and the commercial Within any project there will be a number of
management approaches which are stakeholders, some of whom will not be part of
all part of the PID the project management team, but their views
• Describe the PRINCE2 technique for still need to be considered by the project’s
the Organizing practice – the five step decision-makers.
‘organizational design and The PRINCE2 Organizing practice provides a
development procedure’ structure that enables all stakeholder views to
• Describe the concepts of Project be represented.
Board and project team, and the
introduce the PRINCE2 roles, and There are four basic levels of management. At
• Explain how the Organizing practice the highest level we have the business layer,
relates to the principles of PRINCE2. which PRINCE2 also calls the ‘commissioning
authority’ which sits outside the project
Let’s make a start by considering the purpose management team and is responsible for
of the Organizing practice. commissioning the project, providing the
mandate, identifying the Project Executive and
defining the project level tolerances within
which the Project Board will work.
S3-2P2: The Three Project Interests
Tony: The next level is Directing - and relates to the
The purpose of the Organizing practice is to activities of the Project Board. This is where the
define and establish the project’s structure of major decisions about the future of the project
accountability and responsibilities. are made.
This practice is directly related to the Define The Managing level includes the day-to-day
roles, responsibilities and relationships activities of the Project Manager. The Project
principle and defines roles that relate to the Manager’s main responsibility is to manage
three project interests of business, user and relationships within the project to ensure that
supplier. the right products are produced in accordance
with business objectives and to agreed
These three areas represent the principal
requirements.
categories of project stakeholders who are
represented by the PRINCE2 method in the Finally, the Delivering level is where the work is
governance and management arrangements undertaken by team members to build or
for the project. Each interest has specific roles develop the products of the project, co-creating
on the project to ensure interests are met. For with other members from within the project
example... ecosystem if required.
The project’s products should meet the Karen, can you introduce us to the PRINCE2
business need that justifies the investment and Project Board please?
the project should also represent value for
money throughout the lifetime of the project.
This is known as the business interest and is
represented by the Project Executive. S3-2P4: The Project Board – 1
Karen:
The Senior User represents the stakeholders Thanks Tony. The focal point of the PRINCE2
from the user community, who might also be project management organizational structure is
end users who sit outside the organization. the Project Board. They are responsible for
This group will define the requirements and, if creating the right environment for the project to
succeed.
35
The Project Board is the authority for the The Project Executive is accountable for the
project and is responsible for the project within business case for the duration of the project
the remit set by the business. We will see in the and has to ensure that the project is delivering
processes session how the Project Board carry value for the time and resources being
out most of their work via the Directing a invested.
project process.
The Project Executive is responsible for
Within the confines of the project, the Project governing the project in ways that align to
Board is the highest authority, but are business strategy, including thinking in more of
accountable to the business for the success of a strategic long-term way about areas such as
the project overall. the environmental, social and economic
impacts of the project.
PRINCE2 identifies this top-level body as the
business, the business layer or commissioning Where the project is part of a programme, the
party, and it is from here that the project Programme Manager may be the Project
mandate is handed down in order to trigger the Executive.
Starting up a project process.
The Senior User role represents the user
community, being accountable for the approach
taken to capture user requirements, and that
S3-2P5: The Project Board – 2 the specification of benefits is aligned to the
Karen: business case.
The Project Board should represent the three
interests discussed - namely the User, the The responsibility of the Senior User starts with
Supplier and the Business interests. the specification of user requirements,
controlling change to those requirements and
In order to achieve this, three roles are the adoption and handover of products into the
specified - the Senior User, representing the business.
user interest, the Senior Supplier representing
the supplier interest and the Project Executive,
representing the overall business interest.
S3-2P7: The Project Board – 4
The important point here is that these are roles Karen:
- not job titles or individuals. The roles can be A very important responsibility of the Senior
combined or shared, and the names can be User is the identification and realisation of
changed as appropriate to make them more benefits. This means the Senior User’s
understandable to people within your particular responsibility is likely to continue into the
organization. operational environment and beyond the
lifetime of the project.
The main concern of PRINCE2 at this point, is
that a Project Board exists and that the three As work progresses, it is the Senior User’s
interests are properly represented by that responsibility to monitor what is being produced
Board. and ensure that it will meet user needs and that
the expected benefits are materialised.
In small projects it may be desirable to combine
roles, for example, the Business interest and Depending on the scale of the project, it is
User interest may be represented by one likely that more than one person would be
person fulfilling two roles – Project Executive required to represent users, however, this
and Senior User. should be kept to a minimum.
At the other end of the scale, in very large Where the project is part of a programme, the
projects, each role may require a team of Senior User role may be fulfilled by the
people. programme Business Change Manager.
The Senior Supplier role is there to represent

the supplier community involved in all aspects
S3-2P6: The Project Board – 3 of delivering the project’s products.
Karen:
Each of the three Project Board roles has very It is quite common for the Senior Supplier role
clearly defined responsibilities. to be filled by a person or people external to
the organization, although it could be a
The Project Executive is the key role and is representative from an internal supplier
ultimately accountable to the business for the department or indeed a contracts manager in a
entire project, supported by the other two roles. situation where there are more than three or
four suppliers.
36
Let’s move on to try a few multiple-choice It is the responsibility of the Project Manager to
questions. plan and oversee all of the day-to-day work,
managing relationships within the project
S3-2P8: Activity ecosystem, to ensure that the project is
Karen: producing the right products, at the right time,
Which of the following are two levels of to the right specifications of quality and within
management in PRINCE2? the allotted budget.
A. Supervising The role of Project Manager should not be
B. Creating shared, and always relates to a single person.
C. Managing
D. Directing. On large projects, the volume of work and
Choose from the following answers: demands for specialist knowledge may justify
the appointment of Team Managers to support
1. A and B the Project Manager in the management and
2. B and C control of specific work package descriptions.
3. C and D Also, dependent on the skill and capacity of the
4. A and D. Project Manager, the Project Manager can also
perform the Team Manager role.
The main tasks of the Project Manager include

overall planning for the whole project,
S3-2P9: Activity
monitoring and supporting the well-being of
Karen:
team members and the sustainability of the
Identify the missing word(s) in the following
project approach, managing and delegating
sentence.
work to Team Managers and team members,
The purpose of the Organizing practice is to and reporting progress to the Project Board.
define and establish the project’s structure of
In summary, the Project Manager is there to
[?] and responsibilities.
ensure that a result is achieved which makes it
1. Delegation possible to realise the benefits described in the
2. Decision-making business case.
3. Accountability
4. Actions.
S3-2P13: Team Managers
Tony:
S3-2P10: Activity
The appointment of separate people in the role
Karen:
of Team Manager is optional, depending on the
The group responsible for achieving outcomes
nature and demands of the project.
are represented by which role on the Project
Board? Where they do exist, it is the responsibility of
the Team Manager to manage the creation and
1. Project Manager
delivery of the work package description and
2. Project Executive
associated specialist products under their
3. Senior Supplier
control, in accordance with the commercial
4. Senior User.
management approach, as defined by the
Project Manager.
S3-2P11: Activity
The Team Manager will manage relationships
Karen:
within their team, and interfaces with other
At which level of management are the products
teams working at the same time, plus the
produced?
Project Manager, project support and project
1. Directing assurance.
2. Delivering
The Team Manager ensures products are
3. Managing
delivered to the team to the agreed
4. The business layer.
specifications, and any suggested changes to
the products relating to the work package
S3-2P12: The Project Manager description for which a Team Manager is
Tony: responsible, will be raised as issues and sent
A key role in any project is, of course, the to the Project Manager for a decision.
Project Manager.
One of the tasks of a Team Manager is to co-
ordinate, virtual or physical, daily-stand up
37
meetings, then to subsequently raise time on the project, therefore they place a great
checkpoint reports for the Project Manager. deal of reliance on the Project Manager.
Alternatively, the Project Manager could attend
such a daily stand up as an observer. Although they receive regular reports from the
Project Manager, there may always be
It is on the basis of these checkpoint reports questions at the back of their minds - ‘Are
that the Project Manager then provides regular things really going as well as we are being
highlight reports to the Project Board. told?’, ‘Are any problems being hidden from
us?’, ‘Is the solution going to be what we
want?’, ‘Are we suddenly going to find that the
project is over-budget or late?’, ’Is the quality
S3-2P14: Project Support – 1
management system being adhered to?’
Tony:
All projects have a requirement for All of these questions mean that there is a
administrative support, and advice on project need in the project organization for a means of
tools, offering planning support and assistance assessing all aspects of the project’s
with risk and change management for example. performance and products, which is
This is known in PRINCE2 as project support. independent of the Project Manager. This is the
project assurance function.
It is the responsibility of the Project Manager,
and dependent on the skills and capacity of the Each board member has their own set of
Project Manager, project support responsibilities for project assurance reflecting
responsibilities can be delegated to individuals their respective Business, User and Supplier
or groups within the business, or to other team interests. Each board member may undertake
members. assurance tasks themselves, but, if they wish,
they can delegate some or all of their
This enables the Project Manager to
responsibilities for assurance to individuals
concentrate on the management of the project
from the wider business or external party,
instead of getting bogged down in
however, assurance responsibilities cannot be
administration activities, especially for large or
assigned to the Project Manager, Team
complex projects.
Managers or project support.
Many large organizations may establish a
If project assurance roles are delegated, the
Project Office, who can in turn offer project
Project Board members are still accountable for
support.
their own area of interest.
S3-2P15: Project Support – 2
One thing to consider here is on larger more
Tony:
complex projects, the project board may grant
Some of the main tasks that are normally
‘change authority’.
carried out by the project support function can
be found at the end of each practice chapter in Not so much a ‘role’ in PRINCE2, but rather, a
the PRINCE2 guide. These will include, for set of rules which allow a person or group to
example, providing assistance with: make decisions on requests for change and off-
specifications, which are two types of issue in
• Stakeholder analysis
PRINCE2.
• Communications management
activities By default, this responsibility lies with the
• Change management activities Project Board but they may, if they wish,
• Commercial management activities delegate it to another body at the most local
• Compilation of project plans, stage level, where knowledge and capacity to make
plans and work package descriptions those decisions may reside.
• Application of the project’s risk
procedures We’ll explore ‘change authority’ again in the
Issues practice.
To name but a few.
Karen, please can you walk us through project S3-2P17: Project Management Team
assurance? Structure and Role Descriptions
Tony:
Now we will consider the management
S3-2P16: Project Assurance products that relate to the Organizing practice.
Karen: Two products form part of the project initiation
The Project Board members do not work full- documentation, and the project brief that came
38
before it, these are the ‘product management It’s one of nine approaches in the PID and its
team structure’ and ‘role descriptions’. purpose is to describe the procedures,
techniques, and standards to be applied and
Pete, would you mind taking us through them the responsibilities for effective commercial
please? management.
Pete: For example, it will state what supplier
No problem Tony. The first management contracts are needed and what standards and
product with regard to the Organizing practice responsibilities there are around market
is the ‘project management team structure’. engagement, procurement or contracts
management.
This could be a visual representation of who is
doing what in the temporary project team and One element in this approach is the delivery
the relationship between them, which, may of model, showing which elements of a work
course change on a stage-by-stage basis. breakdown structure for the project will be
delivered by external suppliers.
The term ‘project team’ is defined as the term
PRINCE2 uses to cover all people required to In a sense, the project management team
allocate their time to the project. structure is reflective of this model, and
underlines where capacity or capability does
Remember that roles in PRINCE2 can be
not exist in an organization, and where there is
shared or combined, with certain limits, for
no long term need to develop them.
example, the roles of Project Executive and
Project Manager must not be shared, in view of In such a situation external suppliers will be
project scale and the skills and capabilities of brought in to support the project, or indeed
those involved. some or all of product delivery will be
outsourced to them.
When agreeing to take on a role within the
temporary structure, it is important that people Tony:
‘sign up’ to a role description, with a clear Thanks Karen.
understanding of that role’s responsibilities, so
they fully understand the role that they are On screen you can see the ‘high level content’
being asked to perform. of the commercial management approach now.
In turn this is likely to identify coaching or

training needs for those whose current skill
level and knowledge are lacking. This will also S3-2P19: Work Breakdown Structures
possibly include influencing skills, and how to Tony:
deal with resistance to change. A moment ago, we mentioned how the
‘commercial management approach’ in the PID
Tony: contained a section called ‘delivery modes’,
That’s great Pete, thank you. within which the concept of ‘work breakdown
structures’ were mentioned.
Pete, can you explain a little further what we

S3-2P18: Commercial Management mean by this please?
Approach
Tony: Pete:
Now we will consider the third management Well, the work breakdown structure is a
product associated with the Organizing technique used as part of the product-based
practice, which, like the project management planning technique in PRINCE2’s Plans
team structure and role descriptions is also part practice.
of the PID. The ‘commercial management
approach’. It is mentioned here in the Organizing practice
because the Project Manager is charged with
Karen, would you mind taking us through them designing, reviewing and updating the project
please? management team structure, which in part, is a
function of the project’s work breakdown
Karen: structure.
No problem Tony. Well, the commercial
management approach is all about getting the This technique is useful when there are
right balance between the use of in-house and multiple work packages in a given project, and
external suppliers, and the associated we have a mix of internal and external skills to
commercial arrangements between them. create the products required in each work
package description.
39
A work breakdown structure, based on the • Management approaches, and

project plan, is used by the Project Manager to • Transition, in terms of transitioning
inform the organizing of the work into teams, people on and off the project.
considering the number and size, and an
identification of which elements will need to be Tony:
externally supplied. An excellent overview Karen, thank you.
On simple projects, with one work package and S3-2P21: Organizational Design and
a small team, a work breakdown structure Development Procedure – Design
would not be required. Tony:
The next part of the suggested ‘Organizational
Tony: design and development’ procedure in
Thanks for that Pete. We’ll discuss work PRINCE2 is ‘Design the project ecosystem’, a
breakdown structures again in the ‘Plans’ term we came across in the ‘people’ element of
practice when we run through ‘product-based the course.
planning’ in a bit more detail.
Pete, could you explore this a little further
please?
S3-2P20: Organizational Design and Pete:
Development Procedure – Understand Well Tony, we’ve already said that the design of
Tony: the team is influenced by the work breakdown
Just like we had for the Business case practice, structure and commercial management
PRINCE2 also suggests a technique, or approach.
procedure, for use with the Organizing practice.
These are both informed by the project
If you have an alternative procedure in place, approach, in other words, how we think we
then it’s fine to use that, and state this in the should do our chosen option in the business
‘Tailoring’ section of the project initiation case, plus its scale and complexity.
documentation.
It’s the Project Executive on the Project Board
Karen, could you outline the first part of this who is responsible for the design, with support
procedure please? from the Project Manager. People will be
Karen: required from the business, plus also,
Yes, no problem, Tony. Well, the organizational potentially, external suppliers.
design and development procedure has five The design needs to determine the:
elements, namely:
• Structure of the team,
• Understand
• The people and resources needed,
• Design
• The implementation of working
• Develop practices, and
• Manage, and • The development of a project culture
• Transition. and associated behaviours.
It’s got a large degree of overlap with the It must also be noted that this design will
‘people’ integrated element of PRINCE2 which evolve and change over the life of the project
we saw in session 2-2. though Tony, with different project team
Understand, means ‘Understand the structures for different stages potentially.
organizational ecosystem’, which, if you Tony:
remember from the ‘people’ integrated element Thanks so much Pete.
of the course, recognises that individuals who
eventually end up taking roles in our temporary
project team, will perhaps have ‘day jobs’ in
organizations that have already got defined S3-2P22: Organizational Design and
organizational structures and corporate Development Procedure - Develop and
governance. Manage – 1
Tony:
The project then needs to think about how it will The next two parts of the suggested
interface with the existing organizational ‘Organizational design and development’
ecosystem on areas such as: procedure in PRINCE2 is ‘Develop the project
ecosystem’, and ‘Manage the ongoing changes
• People management to the project ecosystem’.
• Governance
40
This is where we actually implement the Learning is a key consideration also, sharing
organizational design and adopt and evolve it lessons and knowledge, with the recognition of
thereafter as the project progresses. the new skills and capabilities that those
working on the project may have acquired,
This will involve onboarding people to the which are now potentially useful for the wider
temporary team, with induction activities to get business.
people ‘up to speed’, and, in turn, ‘off-boarding’
activities to ensure lessons are captured.
In addition, this ‘Develop’ step will involve team S3-2P25: The Organizing Practice: Key
building and the associated establishment and Relationships with Principles of PRINCE2
maintenance of a culture for the project team. Tony:
Other activities may be required such as Finally, before we test our understanding with
training team members and dealing with some multiple-choice questions, we are going
succession planning for members who leave to explore how the Organizing practice
the team before completion. contributes to the adherence to the seven
PRINCE2 principles across the PRINCE2
As with the design of the project organization, lifecycle.
development is a responsibility of the Project
Executive supported by the Project Manager. On screen you will see a table, which lists the
seven principles on the left.
The middle column shows how the Organizing

S3-2P23: Organizational Design and practice achieves the principle by doing
Development Procedure - Develop and something.
Manage – 2
Tony: Finally, on the right, we have a column outlining
Next comes ‘Manage the ongoing changes to how by doing something, this results in
the project ecosystem’, and it is here that something beneficial for the project.
feedback loops are established to determine
any capacity or capability gaps, and related So, for example, the Ensure continued
issues. business justification principle is achieved by
assigning someone from the business to the
Here the Project Manager ensures, on a stage- Project Executive role who represents the
by-stage basis, that resources are matched business viewpoint and has sufficient authority
appropriately, transitioning people on and off and availability to fulfil the role and be
the project as appropriate, in accordance with accountable for the project. Resulting in...the
the commercial management approach. project is now able to adapt to changing
business needs, and appropriate decisions are
The end of a stage is a good time to review the made that align with the business case.
project management team structure, with
associated role descriptions and their In short it shows how interconnected the
respective responsibilities, highlighting any PRINCE2 method is. It shows how one of the
changes that may be required going forward. five integrated elements, a practice, relates to
the achievement of principles, another
integrated element, throughout the lifecycle,
namely processes, which are another
S3-2P24: Organizational Design and
integrated element.
Development Procedure – Transition
Tony:
The final part of the suggested ‘Organizational
design and development’ procedure in S3-2P26: Activity
PRINCE2 is ‘Transition to the organizational Tony:
ecosystem’. Time for a few more questions.
Here, the mindset is about ‘making the change Can the roles of project assurance be
stick’ as it were, where we think, at the closure delegated to project support?
of a project, about the organizational
ecosystem that the project’s products will be 1. No
transitioned into, including the arrangements 2. Sometimes
around benefits monitoring thereafter. 3. Yes
4. Only when the project is part of a
In addition, we need to consider the transition programme.
of remaining project team members back into
the organizational ecosystem.
41
S3-2P27: Activity including which roles can be

Tony: combined and shared, and
The Project Board have some responsibilities • Outline the five steps of the PRINCE2
which can, if required, be delegated, although technique for organizational design
they still remain accountable. What are they and development.
called?
1. Decision-making
2. Project assurance
3. Configuration management
4. Exception management.
S3-2P28: Activity
Tony:
Identify which of these terms with regard to the
purpose of the commercial management
approach would NOT be an activity associated
with commercial management aspects of the
project.
The commercial management approach covers

the approach to secure, service and maintain
all commercial arrangements required for the
project to be a success, including activities
such as...
1. Contracts management
2. Procurement
3. Market engagement
4. Information management.
S3-2P29: Activity
Tony:
The work breakdown structure is typically...
1. Replaced by the product breakdown

structure
2. Text or list based
3. Represented visually
4. Used where there is just one work
package, involving just internal or
external skills.
S3-2P30: Summary
Tony:
This brings us to the end of our look at the
Organizing practice.
• Explain the purpose of the Organizing

practice
• Explain the purpose of the project
management team structure and role
descriptions.
• Explain the purpose of the commercial
management approach and the
associated concept of the work
breakdown structure
• Describe the roles and responsibilities
of a project management team,
42
Session 3-3: Practice: Plans
Session 3-3: Practice: Plans There is much misunderstanding about exactly

what constitutes a plan. Many people would
look at a Gantt chart, for example, and consider
S3-3P1: Introduction it to be a complete project plan.
Tony:
Welcome to this session where we shall A PRINCE2 plan is much more comprehensive
consider the Plans practice. than that and, once approved and baselined, it
represents the scope of the project, for a
By the end of this session you will be able to: project plan, and likewise the scope of a stage
for the stage plan.
• Explain the purpose of managing
plans Knowing what is in scope, and what is out of
• Explain the purpose of the project, scope, is essential to avoid uncontrolled
stage, team and exception plans changes, often referred to as ‘scope creep’.
• Describe the steps in the PRINCE2
planning technique of product-based The definition of a plan can be seen on screen
planning now.
• Describe the factors to consider when
structuring the project into stages, and
• Describe the use of tolerances to S3-3P3: The Planning Horizon
address constraints, and how plans Tony:
can address sustainability. It is not usually possible to plan the whole
project in detail from the beginning and this is
Let’s make a start by considering the purpose reflected in the principle Manage by stages.
of the Plans practice.
For example, planning team member’s detailed
activities for the next 12 months would be a
waste of time as it would be out of date after
S3-3P2: Plans Practice – Purpose just a few weeks.
Tony:
Effective project management relies on Therefore, PRINCE2 suggests three levels of
effective planning because without a plan there plan, which are the project plan, stage plan and
is no control. team plan.
The purpose of the Plans practice is to facilitate The project plan provides a high-level view of
communication and control by defining the the full project, comprising key milestones,
products to be delivered and the means to major products, required people and resource
deliver them to satisfy the project business requirements, providing a baseline to monitor
case. progress through the project.
Planning provides all the people involved in the It is defined as “a high-level plan showing the
project to be able to understand: major products of the project and when, how,
and at what cost they will be delivered”.
• The user’s driving requirements and
the benefits they expect to realize, in A detailed plan for each stage called the stage
other the words ‘the why’ plan is produced. The stage plan doesn’t
• The products to be delivered and their extend past the ‘planning horizon’ - this is the
associated high-level acceptance time period over which is it possible to plan with
criteria and quality specifications, or reasonable confidence.
‘the what’
The stage plan is defined as “a detailed plan
• The delivery method such as an
used as a basis for project management control
iterative-incremental approach, and
throughout a stage”.
any constraints, or ‘the how’
• The sequence and estimated duration Finally, we have team plans which cover the
of delivery activities, ‘the when’ work of the team during the stage as defined by
• The facilities and locations involved, the work package description. In PRINCE2
or ‘the where’ team plans are optional.
• The estimated cost of agreed products
and associated delivery and The team plan is defined as "a plan used as
management activities, or ‘the how the basis for organizing and controlling the
much’, and finally work of a team when executing a work
• Risks that may be encountered and package".
issues that affect realism of the plan.
43
S3-3P4: Defining Stages - Balancing Stages a tranche, plus, of course, the planning horizon
Tony: within which it is sensible to plan.
Having the right number of stages of the right
length is fundamental to success, as they If there is significant uncertainty in the
provide a key means of control for the Project estimates, it makes sense for stages to be
Manager on a day-to-day basis. shorter to allow these estimates to be refined in
the next stage.
They also provide key controls for the Project
Board who decide whether to continue, or not, S3-3P6: Defining Stages - Stages and Work
at the end of each stage. Packages
Tony:
A simple PRINCE2 project would probably Karen, would you mind talking about the
have two stages, which are the initiation stage, concept of stages, and link that to the idea of
which is the ‘theory’, to come up with the work packages?
project initiation documentation, and the rest of
the project, and one delivery stage, namely the Karen:
“doing”. Yes of course. Well, the key thing to say about
stages is that they don’t overlap. It’s one stage
Conversely, larger projects with complex sets at a time for the Project Manager.
of products, using a variety of delivery methods
and so on, are likely to involve multiple delivery Stages create ‘stop-go’ decision points by
stages after the first initiation stage. partitioning the project. In order to do the next
stage, the Project Board needs to review
When we determine how to divide the project progress for the current stage and assess
into stages, we must balance: whether the project still has continued business
justification, and if so, they can authorise
• How far ahead it is sensible to plan proceeding into the next stage.
• The sequence of delivery activities
• The amount of risk in the project, as Depending on the delivery methods used, and
higher risk suggests more stages specialist skills required, project work is likely to
• The delivery approach, such as be organized into logical groupings of work
iterative-incremental or linear- packages.
sequential, and finally
Such logical groupings of work packages are
• The number and timing of key
likely to overlap and run in parallel.
decision points.
While this is fine within a stage, it’s good
practice not to have work packages which span
S3-3P5: Defining Stages - Length of Stages
a stage boundary. The fear is of course that
Tony:
the Project Board may decide not to authorise
We have discussed how dividing projects into
progression into the next stage, and work
stages requires balancing a number of factors.
would have been started on a work package
Linked to that we now need to consider the
that is now no longer required.
length of stages in a project, which, we need to
make clear at the outset, are not necessarily Sometimes work packages spanning stage
the same length throughout the life of a project. boundaries can’t be avoided, so status of such
work needs to be reviewed in the Managing a
Shorter stages mean more stage boundaries
stage boundary process.
and a greater effort for the Project Manager
and Project Board in terms of more end stage Tony:
assessments. That’s great Karen, thank you.
Longer stages mean fewer end stage
assessments but, potentially, reduced control
for the Project Board. S3-3P7: Seven Planning Steps - An
Introduction to Product-based Planning
The length of stages would be influenced by Tony:
complexity and level of risk, namely, the more Pete, could you run through the product-based
complex or risky a project is, the more stages planning technique in PRINCE2 for us please?
you are likely to have.
Pete:
Other factors will also come into play to No problem. There are seven planning steps in
influence the length of stages, such as where PRINCE2’s planning procedure.
key decisions need to be made, coinciding with
programme decision points, such as the end of
44
The first is defining and analysing products procedure, otherwise known as the product-
using the product focused steps that we will based planning technique?
review later in this session.
1. Resource levelling
This naturally leads us to defining delivery 2. Analysing risks
activities associated with each product, which 3. Critical path analysis
can be organized into work packages required 4. Identifying work packages.
to develop the products and understanding the
dependencies between them.
S3-3P10: Activity
Once we know what we have to do, we can Pete:
estimate the durations of each delivery activity Identify the missing word(s) in the following
and prepare the schedule. After which we sentence:
allocate a budget to cover the cost of people
and resources to make those activities happen PRINCE2 defines a project plan as: a [?] plan
and, generically, to manage the project. showing the major products of the project and
when, how, and at what cost they will be
At each of these steps we must consider the delivered.
risks to the plan and any mitigating actions
must be included in the schedule. 1. Detailed
2. High-level
The final step in the process is to ‘document 3. Mid-level
the plan’, which means we prepare a short 4. Low-level.
narrative to describe what the plan contains,
internal and external dependencies, monitoring
and control requirements, budgets, S3-3P11: Activity
assumptions, tolerances and so on. Pete:
For a simple project, with well-understood
This planning procedure can be applied to any products and a mature delivery method, how
level of plan. many stages would typically be required?
Tony: 1. 1 stage
That’s great Pete, and later on in this session 2. 2 stages
we’ll ‘dig’ into the PRINCE2 technique of 3. 3 stages
product-based planning, otherwise known as its 4. 4 stages.
‘planning procedure’, in a bit more detail.
S3-3P8: Activity S3-3P12: Project Plan

Pete: Pete:
Time for a few questions. The project plan is created during the Initiating
a project process and baselined when the
Which TWO of these would be factors when Project Board approve the progression into the
determining how to divide a project into ‘doing’ part of the project, at the ‘Authorize the
stages? project’ decision point in Directing a project.
A. When the Project Executive is It is updated towards the end of the stage in the
available Managing a stage boundary process, and then
B. How far ahead it is sensible to plan re-baselined when the board authorize the next
C. The delivery approach such as stage.
iterative-incremental or linear-
sequential The project plan provides confidence to the
D. If the planners’ preferred tool is Project Board that the project will deliver the
Kanban boards or Gantt charts. business case, informing the wider project
Please choose from the following answers: management team that they have a viable
approach to deliver the products with available
1. A and B resources, within tolerances laid down by the
2. B and C business.
3. C and D
4. A and D. The project plan should also detail:
• The number of stages and stage

S3-3P9: Activity boundary details
Pete: • Proposed work packages,
Which of the following is one of the seven representing the top level of a work
planning steps in the PRINCE2 planning
45
breakdown structure, stating their when a work package has been accepted,
general purpose and scope, and during the managing product delivery process.
• Whether each work package should
be delivered sequentially or iterative-
incrementally. S3-3P15: Exception Plans
Tony:
S3-3P13: Stage Plan When it is predicted that a plan will no longer
Tony: finish within the agreed tolerances, an
The first stage plan produced in the PRINCE2 exception plan may be produced to replace that
lifecycle is the initiation stage plan created in plan.
the Starting up a project process. An exception plan follows an exception report
Stage plans are similar to the project plan in and explains how the project will respond to the
content, but each element will be broken down exception within the stage.
to the level of detail required to be an adequate When a stage exceeds, or is forecast to
basis for day-to-day control by the Project exceed, agreed stage tolerances, a Project
Manager. A stage plan is required for each Manager will raise an exception report to the
stage. Project Board.
Each delivery stage plan is created near to the If the Project Board decides to address the
end of the previous stage in the process of exception within the stage, the project
Managing a stage boundary, by virtue of a management team will prepare an exception
planning workshop involving the Project plan covering how directed actions will be
Manager, Project Board, project assurance and performed.
Team Managers and possibly other
stakeholders. It is prepared at the same level of detail as the
plan it replaces at either project or stage level.
The stage plan should include a stage product Once an exception plan has been approved it
breakdown structure, showing products within becomes the new baselined project plan or
scope of the stage and their relationships. stage plan as appropriate.
It should also include a stage work breakdown An exception plan picks up from the current
structure, identifying major activities, and the plan’s actuals and continues to the end of that
people and resources needed to make those plan.
activities a reality.
Exception plans are not produced at team
The stage plan is produced close to the time level. Should a work package be forecast to
when the planned activities will take place. exceed its tolerances then provided it can be
The stage plan is for a much shorter duration resolved within the stage tolerances, the
than the project plan and the stage plan is Project Manager will amend or replace the
developed with the benefit of knowledge of the work package description in question.
performance of earlier stages. Exception plans require the approval of the
Project Board if they replace a stage plan or by
the business layer if they replace the project
S3-3P14: Team Plan plan
Pete:
Depending on the complexity of the project and
the amount of resources required, the Team S3-3P16: Product-based Planning –
Manager may produce a team plan, which is Introduction
used as the basis for organizing and controlling Tony:
the work of a team when executing a work According to the traditional way of planning
package. projects, the starting point is to decide on all
Team plans are regarded as optional. As such the activities that were needed to complete the
PRINCE2 does not prescribe a format for them project.
as there may be more than one team on a PRINCE2, quite sensibly, says that a better
project, possibly from different supplier starting point is to determine and fully
organizations and hence they may have understand all the products which the project is
different planning standards. to create. Having done that, it will be much
Team Managers could produce team plans in easier to identify and plan the activities
parallel with the production of a stage plan, or
46
necessary to deliver and check them, and It has a big bearing on the Plans practice, in
generically, to manage the project. terms of the list of major products, essentially
representing our first take on ‘scope’ for the
Product-based planning is a technique project.
suggested by the Plans practice, also referred
to as the ‘planning technique’, which leads to a It also has a major bearing on the Quality
plan based on the creation and delivery of practice, as it is the starting point of what we
products. call ‘quality planning’.
This aligns to the principle of Focus on The Senior User is responsible for specifying
products, and by identifying the products first, it the project product. However, in practice the
then leads to consideration of the most Project Manager will often complete the project
effective way of delivering them. In addition, by product description in conjunction with the
identifying products and their dependencies in Senior User, Senior Supplier and the Project
a plan, it clearly defines what is in, and not in, Executive.
the plan’s scope. Without this understanding,
issue and change control cannot function. This will provide the high-level scope of the
project, which in turn, will enable the top levels
In addition, product-based planning simplifies of the project’s product breakdown structure to
the identification of the work packages to be completed.
deliver the identified products, and also, the
sequencing of these work packages. Pete, would you like to provide us with an
example?
We outlined the seven elements of PRINCE2’s
product-based planning technique earlier, but
here, we want to explore one step in more
S3-3P18: Product-based Planning - Product
detail, that of ‘defining and analysing products’.
Breakdown Structure Example
This actually consists of four main steps: Pete:
Thanks Tony
• Writing the project product description
• Creating a product breakdown Imagine you were the Project Manager building
structure the Channel Tunnel. You would want to start
the project by drawing up a very high-level
• Writing product descriptions, and
product breakdown structure.
• Creating a product flow diagram.
We have already filled in the major product,
We’ll explore these elements in a bit more which is the finished and operational tunnel.
detail now:
What do you think would be reasonable major
component products for this project?
S3-3P17: Product-based Planning - The There are no right or wrong answers here.
Project’s Product Description and the Even in real life, how you design your product
Product Breakdown Structure breakdown structures is entirely down to your
Tony: own preferences and the needs of the project.
The product breakdown structure (or PBS) is,
quite simply, the hierarchy of all products to be Click on the button to view our attempt at this
produced during a plan. one.
The idea is to take a top-down view of all the

products which the project is going to generate,
starting at the top with the finished deliverable S3-3P19: Product-based Planning - Product
of the project and then breaking each product Breakdown Structure
down into its essential components in a Tony:
hierarchical structure. A product breakdown structure is a hierarchical
breakdown of the project’s products. PRINCE2
However, before we can do this, a project does not prescribe any format for these – it
product description should be written. could be a simple indented list, a mind map, or
a diagrammatic structure. It will all depend on
This is a description of the project’s major your organizational preferences.
products or outcomes, including the user’s
quality expectations, together with the Remember, the whole point of a breakdown
acceptance criteria and acceptance methods structure is to group together, in a logical
for the project. manner, requirements specific to one product
or component.
47
This logical grouping of requirements also special skills, facilities, or equipment

extends to grouping based on the delivery required.
method being used or procurement method. • Quality tolerance - Is there a range
within which key quality specifications
There will often be products that will be can vary and remain acceptable?
provided from outside the project. These are • Quality methods and skills required -
known as external products, and will The quality methods (such as
subsequently be detailed in the ‘dependencies’ verification, test, and inspection) to be
section of the ‘plan’. used to check the product meets its
It is also useful to consider whether ‘states’ of quality specification, and the indication
products should be on the PBS, for example, of skills required to perform the quality
dismantled, moved and assembled machinery, control activities, and
each with their own quality specification. An • Responsibilities - Identifying the
alternative would be to describe these states producer, reviewer and acceptance
within a single product description. authority for the product.
Product breakdown structures are used at

project and stage plan levels and are optional
for team plans.
S3-3P21: Product-based Planning - Product
Flow Diagram
Tony:
S3-3P20: Product-based Planning - Product Once a complete understanding of the required
Description products of a project has been achieved,
Pete: attention needs to focus on the sequence in
Next, with regard to the ‘Defining and analysing which those products need to be created.
products’ element of the product-based
planning technique we come to the ‘product Note however, that this often is done in parallel
description’. with the production of the product breakdown
structure, and will often be a continuation of the
The Project Manager gets the user’s same planning workshop.
requirements for products and documents in a
product description, consulting with subject The product flow diagram is a diagram showing
matter experts as to how these products needs the sequence of production and
to be procured, developed, tested, used, and interdependencies of the products listed in a
supported, post their acceptance. product breakdown structure.
PRINCE2 recommends the main headings that It is used to show the order in which products
should be included in a product description as must be created, and therefore dependencies
shown: between them, and based on this, it then
becomes relatively straightforward to produce a
• Identifier - The product name or, if the schedule of all the activities that are required
project has a large number of for the project.
products, a unique identifier
• Version – Current version of the A product flow diagram can identify
product description intermediate products, which are those created
as an essential input to the delivery of another
• Purpose – The purpose of the
product but not intended for use by user, for
product, how it will be used and who
example a prototype design. Naturally, it will
will use it
also show ‘final products’ which will be used by
• Composition – A list of the product’s
the user community.
components or parts
• Derivation - The source of this A product flow diagram should have a clear
product, such as a design, a starting point and a clear end point, either from
commercial product, an existing top to bottom or left to right.
system to be upgraded or replaced, or
a statement of expected benefits The starting point for the product flow diagram
• Quality specifications - What criteria will be the product or products that are
must the product meet for it to be available right at the start of the project and the
judged ‘fit for purpose?’ end will be the final deliverable of the whole
• Development or production approach project.
and skills required - A description of
Subsequently, it can be useful for the Project
how the product is expected to be
Manager to sit down with the Senior User once
developed or produced, and any
48
it has been done, to map this sequence to the product delivery, namely the Team Manager
expected achievement of outcomes and and members.
benefits.
For now though, we’ll state that the purpose of
the work package description is to describe
how one or more products will be produced and
S3-3P22: Product-based Planning – delivered. It is used to pass responsibility for
Example work formally to a Team Manager or team
Pete: members.
Referring back to our Channel Tunnel example,
we can see from the product breakdown It includes a statement of the work to be done
structure for the specialist products, all the and the associated work breakdown structure,
major products that have been identified. which is something we mentioned in the
Organizing practice.
Before work can start on any of these products,
we would in fact need an external product, The work breakdown structure is a way of
which would be ‘Government Approval to mapping work packages to relevant teams, and
Proceed’. has a number of applications.
Once approval for the project has been granted The product flow diagram helps identify the
work can commence on excavating the hole for appropriate delivery method, such as linear-
the tunnel. sequential, and once identified, delivery
activities for each product can be organized
Since there are no dependency issues, work into work packages involving closely related
can also start immediately on building the new people and resources.
road system around the terminals and the
rolling stock that will eventually operate in the Work packages need to record dependencies
finished tunnel. discovered in the product flow diagram that
came before them.
Having produced an excavated hole, the next
required product is the lined tunnel, followed by A ‘dependency’ means that one product is
a lined tunnel complete with all the required dependent on another. There are at least two
service, and so on, for each of the other types of dependency relevant to a project,
branches until eventually the required end- internal and external.
product is arrived at.
Each of the products on a product flow diagram

will be built via a series of activities. S3-3P24: Internal dependencies
Tony:
To transform an excavated hole into a lined Internal dependencies are where the project
tunnel requires a major activity – ‘Build Tunnel team has control over the dependency between
Lining’. Then to transform this into the tunnel one product and another, whereas an external
complete with services might require ‘Install dependency is where a product being produced
Electricity’, ‘Install Lighting’, ‘Install Ventilation’, by our project is dependent on a product
and so on. outside the scope of the project. In this case
the project team does not have complete
Hence it is easy to see how product flow control over the dependency.
diagrams form the link between product-based
planning and activity-based planning. Work packages are often interrelated, and the
key is to ensure there is no overlap between
We’ll explore this a little further now. them, to avoid duplicated effort.
Ultimately, the totality of the work packages

represents the full scope of the project. There
S3-3P23: Organizing work packages
should be no disconnect or gaps between the
Tony:
product breakdown structure, product flow
Following the ‘Defining and analysing products’
diagram and work packages relating to a
step in PRINCE2’s product-based planning
project.
technique comes the ‘Organizing work
packages’ step.
We’ll explore work packages more later on in S3-3P25: Preparing Estimates, Preparing a
the course when we look at the interface Schedule and Preparing a Budget
between the Controlling a stage process, Tony:
namely the Project Manager, and Managing Karen, next in the product-based planning
49
technique come the steps of ‘Preparing Alternatively, if a project has a fixed budget,
estimates’ and ‘Preparing a schedule’. Would then there will be narrow cost tolerance, and
you mind expanding on these a little more this too, might be set to zero.
please?
Likewise, a project that needs to deliver the
Karen: 100% solution, and only the 100% solution with
No problem, Tony. Well, ‘Preparing estimates’, nothing ‘missing’, will have zero scope
is all about how long we think activities will tolerance.
take, and also, what people and resources,
such as equipment, facilities or natural Definitions of these tolerance areas can be
resources, we think we’ll need to make them found on screen now.
happen.
If we put time and resources together, it

S3-3P27: How Plans Deliver Sustainability
naturally leads to a consideration of cost, if we
Tony:
consider the labour rates for those people, fees
The last element to mention in regard to the
for resources and so on.
Plans practice is the relevance to the aspect of
This then links to another step in product- project performance of sustainability.
based planning called ‘Preparing the budget’,
Pete, could you explore this a little further
which takes this information and uses it to
please?
allocate a budget to the project or stage in
question, which may include provision for risks Pete:
and changes, which we will explore further in Absolutely Tony.
the risk and issues practices respectively.
Well, there are three ways plans address this
The ‘Preparing a schedule’ step is where the really. The first is the concept of ‘product
sequencing, interrelationships, and duration of sustainability’, whereby we think about the
work packages and their associated tasks are environmental impact of the product through its
captured in a schedule, such as a Gantt chart. full lifecycle.
A schedule is defined as "a graphical The second way plans address sustainability is
representation of a plan, typically describing a to think about ‘delivery sustainability’, namely,
sequence of tasks, together with resource how choices made around planning stages and
allocations, which collectively deliver the plan". delivery activities in work packages can have
climate impacts, in terms of things like
Remember though that a plan in PRINCE2 is
production waste or fuel consumption.
more than just the diagram. It also includes
supporting narrative and a statement of Thirdly, we have the concept of ‘benefits
proposed tolerances. sustainability’, and the fear that benefits will not
be sustained after the project has closed.
Tony:
Thanks Karen. The Plans practice may address this by
ensuring requirements are addressed, which
would form part of the project, to ensure
S3-3P26: Tolerances to Manage benefits continue to be realised, without the
Constraints~ temporary support of the project.
Tony:
This might include transitional activities, to
We mentioned how a plan will include a
ensure the change truly ‘sticks’, ensuring that
statement of tolerances, namely, the
ongoing training and user support, once
‘permissible deviation’. This is something that
products are part of ‘new’ business as usual, or
the Progress practice will return to. For now,
the future target state.
though, it must be noted that most projects are
driven by some form of constraint.
Such constraints may be regarding schedules S3-3P28: The Plans Practice - Key
or resources, and therefore, PRINCE2’s idea of Relationships with Principles of PRINCE2
tolerances can be used to manage such Tony:
constraints. Finally, before we test our understanding with
some multiple-choice questions, we will
For example, if a project is schedule-driven,
consider how the Plans practice contributes to
there may be narrow time tolerance, possibly
the adherence to the seven PRINCE2
set to zero.
principles across the PRINCE2 lifecycle.
50
On screen you will see a table, with the seven 3. Creating a product breakdown
principles, we introduced earlier in the course, structure
down the left-hand side. You can find these 4. Creating a product flow diagram.
outlined in the second chapter of the PRINCE2
eBook or printed guide.
S3-3P31: Activity
The middle column of the table shows how the Pete:
Plans practice achieves the principle by doing Which PRINCE2 plan is optional?
something.
1. A stage plan
Finally, on the right-hand side, we have a 2. A team plan
column outlining how by doing something, this 3. A project plan
results in something beneficial for the project. 4. An exception plan.
So, for example, the Manage by stages

principle is achieved by breaking the project S3-3P32: Activity
lifecycle into stages as a means of Pete:
accommodating planning horizons and aligning Which one of these is a stage?
stages to key decision points as required.
1. Initiation
Resulting in… project stages and tolerances 2. Detailed design
are planned in a manner appropriate to both 3. Development
the business needs and realistic estimates of 4. Handover and closure.
resources, schedule, risks and issues. In short
it shows how interconnected the PRINCE2
method is. S3-3P33: Summary
Tony:
It shows how one of the five integrated This brings us to the end of our review of the
elements, a practice, relates to the Plans practice in PRINCE2.
achievement of principles, another integrated
element, throughout the lifecycle, namely • Explain the purpose of managing
processes, which are another integrated plans
element. • Explain the purpose of the project,
stage, team and exception plans
• Describe the steps in the PRINCE2
planning technique of product-based
S3-3P29: Activity
planning
Pete:
• Describe the factors to consider when
Time for a few more questions on the Plans
structuring the project into stages, and
practice.
• Describe the use of tolerances to
Which of the following are two of the elements address constraints, and how plans
in the defining and analysing products step of can address sustainability.
PRINCE2’s product-based planning technique?
A. Preparing the budget
B. Preparing estimates
C. Writing product descriptions
D. Creating a product flow diagram.
Choose from the following answers:
1. A and B
2. B and C
3. C and D
4. A and D.
S3-3P30: Activity
Pete:
What is the first step in defining and analysing
products?
1. Writing product descriptions

2. Writing the project product description
51
Session 3-4: Practice: Quality
Session 3-4: Practice: Quality • Explicitly confirm the user’s quality

expectations and acceptance criteria
for the project product
S3-4P1: Introduction
Tony: • Identify the project’s products to the
Welcome to this session where we shall level at which the project intends to
consider PRINCE2’s Quality practice. exert control
• Define the products in product
By the end of this session you will be able to: descriptions which will include the
quality specifications, quality methods
• Explain the purpose of the Quality and the quality responsibilities of
practice those involved, and finally
• Explain the purpose of the project • Implement and track the quality
product description, product methods used throughout the project.
description, quality register, product
register and quality management User’s quality expectations are defined as “a
approach statement about the quality expected from the
• Describe the concept of quality project product, captured in the project product
assurance as opposed to project description.”
assurance
• Explain the PRINCE2 technique Whereas acceptance criteria are defined as “a
known as the three-step ‘quality prioritized list of criteria that the project product
management procedure’, which must meet before the customer will accept it.
consists of planning quality, controlling For example, measurable definitions of the
quality and accepting products, and attributes required for the set of products to be
finally acceptable to key stakeholders”.
• Explain user’s quality expectations
and acceptance criteria.
S3-4P3: Quality Planning and Quality
Let’s make a start by considering the purpose Control
of the Quality practice. Tony:
Quality planning is concerned with the
capturing of quality specifications for the
S3-4P2: Purpose of Quality project’s products and generating the
Tony: associated product descriptions and quality
PRINCE2 defines quality as “the degree to management approach.
which a set of inherent characteristics of a
We also set out the quality methods which
product, service, process, person, organization,
relate to the way we will check that a product
system or resource fulfils requirements” and
meets its specifications and the responsibilities
further defines quality management as “the
of those involved.
coordinated activities to direct and control an
organization with regard to quality”. This very much links to the Focus on products
principle in PRINCE2, which aims to translate
Within a project environment the main aim of
requirements into acceptance criteria and
quality management is to ensure that the
quality specifications for the project product,
products meet the user’s requirements and
and individual products respectively.
expectations and, thus, enable the desired
benefits to be realized. It must be noted though that no project will ever
satisfy all the requirements, hence why they
The term ‘requirement’ is used throughout the
need to be prioritized using a suitable
PRINCE2 method and can be defined as “a
technique.
need or expectation that is documented in an
approved management product”, which, in the On larger projects requirements will be more
case of quality, refers really to the product dynamic, and therefore requirements
description which we outlined in the Plans management is an ongoing activity throughout
practice earlier in the course. the life of the project, as well as the Project
Manager creating product descriptions in the
Please note, needs and expectations that are
Initiating a project process, especially in more
not captured are considered outside the scope
of a linear-sequential project, and also in
of the project.
Managing a stage boundary when planning for
The Quality practice contains systematic the next stage.
actions to:
52
The second part of project quality management S3-4P5: Registers relating to the Quality
is quality control. Practice
Tony:
Quality control involves the procedures to A moment ago, we mentioned two registers
monitor specific products of a project and their which support the quality management
development or delivery activities to determine procedure, they were the product register and
whether they comply with relevant standards the quality register.
and identifying ways to eliminate causes of
unsatisfactory performance. This involves: Karen, could you outline them a little further
please?
• Obtaining user acceptance of the
delivered products, and Karen:
• Assessing issues related to quality. Yes of course.
The results of quality checks are recorded in The product register is defined as “a
the quality register, and the status of those component of the project log that identifies the
products would be recorded in the product products to be delivered by the project and
register. Both of these registers form part of records their acceptance”.
the project’s log, along with the other logs and When product descriptions are approved and
registers. baselined by the Project Board when
authorisation is given to proceed with the next
stage, then an entry will be made in the product
S3-4P4: Quality Assurance and Project register for the products relating to the next
Assurance stage.
Tony:
It is very important that we don’t confuse quality The key element for the product register is the
assurance with project assurance. ‘status’ field, noting whether, at this particular
moment in time, a specialist product is ‘To do’,
Quality assurance is the way we check that the ‘In progress’, or ‘Done’. Alternatively, ‘In
project is being managed and directed properly. development’, ‘In test’ and ‘Handed over’.
It looks from the ‘outside, in’ to the conduct of a
project. The purpose of the product register is to list all
of the products required of a plan and the
It is defined as being: “planned and systematic status of those products.
activity that provides confidence that products
will meet their defined quality specifications Another part of the project log relating to quality
when tested under quality control. Quality is of course the quality register. The quality
assurance is typically a function managed register is defined as "a component of the
independently from the project team.” project log that identifies all the quality control
activities that are planned or have occurred and
In short, this ensures that the project is being provides information for end stage reports and
managed in line with the business layer’s the end project report".
standards and policies.
It is used by the Project Manager and project
Quality assurance is independent of the project assurance as part of reviewing progress, for
and is typically performed at programme or example, for the Project Manager to compare
business level. and contrast against the checkpoint reports
they have been receiving from Team
Project assurance on the other hand is a Managers.
Project Board responsibility. It consists of a set
of responsibilities for each board member Tony:
which makes sure they are confident the Thanks Karen.
project is being managed correctly.
Pete, could you take a look at the user’s quality
Each Project Board member has their own set expectations and acceptance criteria, and then
of assurance responsibilities and therefore it is introduce the project product description?
not independent of the project. However,
remember that these responsibilities cannot be
delegated to the Project Manager, project S3-4P6: User’s Quality Expectations,
support or Team Managers. Acceptance Criteria, and the Project’s
Product Description
Pete:
Yes Tony, no problem.
53
User’s quality expectations are captured by the S3-4P7: Activity

Project Manager in discussions with the Senior Pete:
User in Starting up a project, and relate to Time for a few questions.
statements in the project product description,
which is part of the project brief. Which two quality management products are
component parts of the project log?
The project product description should identify,
at a high level: A. Product register
B. Quality register
• Major products to be delivered C. Quality management approach
• User quality expectations and D. Project product description.
acceptance criteria Choose your answer from the following options:
• Any standards or procedures that will
1. A and B
need to be applied, and the way any
2. B and C
business, user or supplier quality
3. C and D
management system will be used
4. A and D.
• Any measurements that may be useful
in assessing whether the project
product is acceptable, and S3-4P8: Activity
• Quality tolerances around the Pete:
acceptance criteria. Which statement relates to a ‘high-level
content’ element of the quality management
As we noted earlier in the session, user’s approach?
quality expectations are defined as a statement
about the quality expected from the project 1. To provide a unique identifier for the
product, captured in the project product quality activities
description, and are often expressed in broad 2. To define the procedure for quality
terms and as far as possible they should be planning and quality control
expanded into a measurable format and 3. To record the results of the quality
prioritized. checks
4. To record the status of a product.
The Senior User, Senior Supplier and Project
Manager should have a shared understanding
of these expectations. S3-4P9: Activity
Pete:
Once the user’s quality expectations are Identify the missing word(s) in the following
established, the acceptance criteria should be sentence.
developed.
PRINCE2 defines quality as: “The degree to
Acceptance criteria are defined as “a prioritized which a set of [?] characteristics of a product,
list of criteria that the project product must meet service, process, person, organization, system
before the user will accept it.” or resource fulfils requirements”.
These are measurable definitions of the 1. Defined
attributes required for a set of products to be 2. Inherent
acceptable to stakeholders and are typically the 3. Specific
functional capabilities the business expects to 4. Measurable.
achieve.
In many projects, it is unrealistic to expect to S3-4P10: Activity

have everything, due to constraints of cost and Pete:
time. Therefore, the acceptance criteria should Again, try to identify the missing words in the
be prioritized. following sentence.
This will help to set the project level quality User’s quality expectations are defined as “a
tolerances. statement about the quality expected from the
project product, captured in the [?]”.
Finally, it is important to remember that both
user’s quality expectations and acceptance 1. Quality management approach
criteria may develop as more is known about 2. Product description
the solution. However, once finalized, any 3. Project product description
changes should pass through the change 4. Product register.
control process.
54
used to assess whether the products meet the

requirements will also need to be identified.
S3-4P11: The Quality Management
Procedure - Quality Planning and Control User’s quality expectations are usually
Tony: expressed in broad terms and will need to be
PRINCE2 suggests a technique for quality, discussed and evaluated in order to define
which it calls the quality management measurable acceptance criteria.
procedure, or ‘product quality lifecycle’ by
another name. As with all techniques Acceptance criteria form a measurable
suggested in PRINCE2, if alternative equivalent definition of the attributes that will be tested in
techniques are in operation, these may be used order to define whether a product is ‘fit for
and noted in the ‘Tailoring’ section of the purpose’.
project initiation documentation.
Based on discussion with the customer about
Quality planning is the capturing of quality the quality expectations and acceptance
specifications for the project’s products and criteria, the project product description is
generating the associated product descriptions defined. This is part of the initial scoping
and quality management approach. activity and includes:
It is important that the user’s quality • Overall purpose of the product

expectations and acceptance criteria are fully • The products it consists of
understood and documented prior to the project • The user’s quality expectations
commencing. This is documented in the project • The acceptance criteria, and
product description, which is part of the project • Project level quality tolerance.
brief.
The project product description is then a S3-4P13: Quality Management Approach

primary input to quality planning, which aims to and Product Descriptions
create two management products, the product Tony:
description and the quality management During the Initiating a project process the
approach. quality management approach is defined. This
describes the quality standards and procedures
The quality procedure for the whole project is that will be followed, the tools and techniques
subsequently defined in the quality to be used, the reporting and record keeping
management approach which forms part of the arrangements, and the roles and
project initiation documentation which is responsibilities for the quality management
assembled in the Initiating a project process. activities
Product descriptions are then created with It should focus on how quality control will be
input from the high-level user quality organized, performed, monitored, and reported.
expectations in the project product description.
It could be that one high level expectation, such Product descriptions are an essential part of
as a car being ‘fuel efficient’, translates into PRINCE2, but the level of detail to be included
many quality specifications in associated is a matter of judgement.
product descriptions, for example, for a tyre on
that car, a quality specification may be around The aim is to provide enough detail so that the
the rolling resistance of the tyre. team members are able to build the products to
the right specifications. Product descriptions
Quality control is the means of ensuring that contain the quality specifications for the product
products meet the quality specifications and the methods by which this will be judged.
specified for them. Quality control is about
examining products to determine that they The last part of the quality planning activity is to
meet requirements and so normally takes place create the quality register, which provides an
after some work has been done. audit trail of the quality events planned and
undertaken.
As the products are built, they are tested using

S3-4P12: Planning Quality an appropriate quality checking method as part
Pete: of quality control.
Quality planning begins by establishing the
user’s quality expectations. These are a key Finally, we have the product register, which, as
input in identifying the quality specifications for we mentioned earlier, has entries added when
the project’s products. Any standards that need product descriptions are approved by the
to be applied and any measures that may be project board.
55
Its high-level content is as follows: delegation should be documented in the quality

management approach.
• Product identifier, the identifier of the
product
• Dates, the date of product description
approval and date of product S3-4P15: Quality Control and Product
acceptance Acceptance
Tony:
• Status of the product (such as in
The latter two parts of the PRINCE2 technique
development or accepted) and current
for quality, the product quality lifecycle, is
version number, and
quality control and acceptance of products.
• References, linked to the associated
product description. Pete, please can you explain these further?
Pete:
S3-4P14: Product Description – Quality Sure Tony. Well, quality control is where we
Related Elements are actually checking products against the
Tony: quality specifications laid down for them in their
In the Plans practice we outlined the content of respective product descriptions. This happens
a product description, but now it’s time to focus in the Managing product delivery process in
on the elements that relate to quality. PRINCE2’s lifecycle, and it must be noted, the
longer we leave a flaw in a product, the cost of
Karen, can you emphasise these please?
correcting it grows exponentially, especially
Karen: when the product is already in operational use.
No problem Tony, well the obvious one is
As checks are made, the quality register is
‘Quality specifications’, in a sense the most
updated by the team manager, usually via
important part of the product description.
project support.
These include functional and non-functional
The quality register records the date a product
requirements. Functional describes how a
was reviewed and approved, which may of
product must perform and be used, whereas
course be different from the target dates initially
non-functional are the ‘ilities’, namely, the
placed in the quality register when the project
inherent characteristics of a product, such as
manager planned for the stage which the
its security, reliability, maintainability and so on.
relevant work package was part of.
Next in the product description we see ‘Quality
The result of ‘pass’ or ‘fail’ is given, and any
tolerance’, which allows a product to be
failure assessed against any quality tolerances
considered ‘fit for purpose’ and acceptable
that may have been set around quality
within certain confines around the quality
specifications, and, the potential off-
specifications.
specification that may result.
Quality methods and quality skills required
Namely, a product was delivered that wasn’t
outline the quality checking methods to be
right or fit for purpose, or perhaps wasn’t
used, such as visual inspections or automated
delivered at all. We’ll talk more about this in
tests.
the Issues practice.
Quality skills refer to the skills needed to do
The last part of the quality technique in
that check, which dependent on the nature of
PRINCE2 is that of ‘product acceptance’.
the products in question, could be very involved
or specialist in nature. Here, the roles defined in the relevant product
description’s ‘Responsibilities’ section listed as
Finally, we have responsibilities, which, for the
‘Acceptance authority’ will be authorised to
product in question, detail who is the producer,
advise whether an individual product is in
reviewer and acceptance authority for the
acceptance or not.
product.
If so, this status change to ‘accepted’, will be
This translates to those who are developing the
recorded in the product register.
product, the producers, those who assess
whether a product meets quality specifications, More globally, acceptance of the entire
the reviewers, and those who decide whether a project’s product will often involve independent
product is acceptable, or fit for purpose. review as to whether the user’s quality
expectations, and associated measurable
Acceptance authority could be granted to the
acceptance criteria were met.
Project Board, or others, in which case such
56
S3-4P16: The Quality Practice: Key S3-4P18: Activity

Relationships with Principles of PRINCE2 Pete:
Tony: Which of these would provide a Programme
Finally, before we test our understanding with Manager with confidence that a project is being
some multiple-choice questions, we are going conducted appropriately?
to consider how the Quality practice contributes
to the adherence to the seven PRINCE2 1. Project assurance
principles across the PRINCE2 lifecycle. 2. End stage assessments
3. Informal discussions with the Project
On screen you will see a table, which on the Executive
left-hand side lists the seven principles which 4. Quality assurance.
we introduced earlier in the course, and that
you can find outlined in the second chapter of
the PRINCE2 eBook or printed guide. S3-4P19: Activity
Pete:
The middle column shows how the Quality Identify the missing words in the following
practice achieves the principle by doing sentence.
something.
Quality planning begins with documenting the
Finally, on the right-hand side, we have a user’s quality expectations in the process of [?].
column outlining how by doing something, this
results in something beneficial for the project. 1. Initiating a project
2. Starting up a project
So, for example, the Define roles, 3. Managing a stage boundary
responsibilities, and relationships principle is 4. Controlling a stage.
achieved by establishing the roles and
respective responsibilities for quality within the
project organization. S3-4P20: Activity
Pete:
Resulting in… clear accountability for quality In which part of the quality management
planning, quality control, and quality assurance. procedure in PRINCE2 would products be
checked by reviewers against the quality
In short it shows how interconnected the specifications laid down for them, and entries
PRINCE2 method is. placed in the quality register?
It shows how one of the five integrated 1. Quality planning
elements, a practice, relates to the 2. Quality assurance
achievement of principles, another integrated 3. Quality control
element, throughout the lifecycle, namely 4. Product acceptance.
processes, which are another integrated
element.
S3-4P21: Summary
Tony:
This brings us to the end of our study of the
S3-4P17: Activity
Quality practice.
Pete:
Time for a few more questions. You should now be able to:
Which of these are quality responsibilities listed • Explain the purpose of the Quality
in a product description? practice
A. Acceptance authority • Explain the purpose of the project
B. Presenter product description, product
C. Facilitator description, quality register, product
D. Reviewer. register and quality management
approach
Choose from the following answers: • Describe the distinction between
quality assurance and project
1. A and B assurance
2. B and C • Explain the three key elements of the
3. C and D PRINCE2 technique for quality, in the
4. A and D. form of the quality management
procedure - of quality planning, quality
control and product acceptance, and
finally
57
• Explain user’s quality expectations

and acceptance criteria.
58
Session 3-5: Practice: Risk
Session 3-5: Practice: Risk • Planned for – identifying suitable

responses to risks and assigning
owners, and
S3-5P1: Introduction • Controlled - by making sure the
Tony: responses are implemented,
Welcome to this session where we shall monitored and controlled.
consider PRINCE2’s Risk practice.
This is the risk management technique, also
known as the ‘risk management procedure’.
• Explain the purpose of managing risk In addition, this procedure can be mapped to
and the purpose of the risk budget ‘guidance for risk management’, which includes
• Explain the purpose of the risk consideration of risk planning, risk analysis, risk
management approach and risk control and risk culture.
register
• Describe guidance for risk We’ll explore what we mean by those terms
management including risk planning, later in this session, and link them to the steps
risk analysis, risk control and in the suggested risk management procedure.
consideration of risk culture
• Define risk as a threat or opportunity,
risk responses, risk owners and risk S3-5P3: Starting Point – 1
action owners, and Tony:
• Define risk in terms of cause, event A good starting point for all projects is to find
and effect out if your organization already has a defined
• Define the difference between risk risk management policy in place, or if you are
probability, impact, proximity and working within a programme, then it would be
velocity, and finally useful to find out how the programme risk
• Describe the PRINCE2 technique for management is undertaken. This will help you
the Risk practice, the risk to define the risk management approach for
management procedure. your project and will include identifying how
much risk the business is prepared to take,
Let’s make a start by considering some key which is informed by the business culture. This
definitions. is known as the business’ risk appetite and is
defined as:
"The amount and type of risk that the business

S3-5P2: Definitions and Principles
is willing to take in pursuit of its objectives".
Tony:
PRINCE2 defines risk as: “An uncertain event Risk appetite will then influence the project’s
that, should it occur, will affect the achievement risk tolerance, otherwise known as the Project
of objectives. It consists of a combination of the Board’s attitude to risk taking, on the project.
probability of a perceived threat or opportunity So, for example, imagine your organization
occurring, and the magnitude of its impact on requires its IT systems to be working
objectives.” uninterrupted over a month end accounting
period, then any risks that may cause a
A threat is a risk that has a negative impact.
disruption over a month end period would have
An opportunity is a risk that has a positive to be escalated.
impact.
The purpose of the risk management approach
Risk management refers to the systematic is to describe how risk will be managed on the
application of procedures to the tasks of project. This includes the specific procedures,
identifying and assessing risks, and then techniques, standards, and responsibilities to
planning and implementing risk responses. be applied.
For risk management to work effectively, risks All identified risks though should be recorded
will need to be: within the risk register which should capture
and maintain information on all the identified
• Identified - clearly describing the risks threats and opportunities relating to the project.
so that there is a common
understanding The risk register is created in the Initiating a
• Assessed - ranking risks in terms of project process. Any risks identified during
estimated probability, impact and Starting up a project should be recorded in the
timing or proximity, Project Manager’s daily log and transferred to
59
the risk register if the initiation stage is S3-5P5: Activity

approved by the Project Board. Pete:
Time for a few questions.
The risk register should contain the following
information: Which of the following are two suitable
responses to a threat?
• A risk identifier – which provides a
unique reference for every risk A. Avoid
entered into the risk register. This will B. Reduce
typically be a numeric or alpha- C. Exploit
numeric value D. Enhance.
• A risk description – a summary of the Your answer choices are:
cause, the event of the risk
1. A and B
• The probability – an estimate of how
2. B and C
likely it is that the risk will occur, for
3. C and D
example using scales from very low to
4. A and D.
very high, or percentages
• The impact – an estimate of the risk
effect, for example, using scales from S3-5P6: Activity
very low to very high, or using ranges Pete:
for cost impacts in monetary terms. Which of the following is a purpose of the Risk
These scales will be outlined in the practice in PRINCE2?
‘standards’ section of the risk
management approach 1. To provide a unique identifier for the
• Proximity - an estimate of how soon a risks identified
risk might occur, for example, 2. To identify, assess and control
imminent, within the stage, within the uncertainties
project and beyond the project, and 3. To record the results of the risk
• Velocity - an estimate of how quickly a workshops
risk would have an impact on 4. To register the date a risk was
objectives should it occur. identified.
S3-5P4: Starting Point – 2 S3-5P7: Activity

Tony: Pete:
The risk register should also contain: Identify the missing word or words in the
following sentence.
• Risk responses – chosen actions to
counter the risk, for example, for PRINCE2 defines risk as: “An uncertain event
threats - prepare contingent plans, or set of events that, should it occur, will affect
accept, share, transfer, avoid and the achievement of [?]. A risk is measured by a
reduce and for opportunities, prepare combination of the probability of a perceived
contingent plans, accept, share, threat or opportunity occurring, and the
transfer, exploit and enhance magnitude of its impact on objectives”.
• Planned residual probability and
1. Success
impact – assuming the risk responses
2. Budgetary targets
are effective
3. Objectives
• The risk owner - this is the person 4. Delivery timescale.
responsible for managing the risk.
There can be only one risk owner per
risk S3-5P8: Activity
• Risk action owner or owners – for the Pete:
risk responses Which of these is a suitable response to an
• Relevant dates related to the risk – for opportunity?
example, date logged, date last
reviewed, action due dates, and finally 1. Exploit
• Records – the list of documents 2. Reduce
associated with the risk and their 3. Avoid
location. 4. Off-specification.
60
S3-5P9: Risk Guidance – Risk Planning and S3-5P10: Risk Guidance – Risk Control
Risk Analysis Tony:
Tony: The next part of risk guidance in PRINCE2 is
Now it’s time to look at aspects of what called ‘Risk control’.
PRINCE2 calls ‘Risk guidance’. We’ll see how
this manifests itself in PRINCE2’s risk Karen, please elaborate further if you don’t
management procedure, which we’ll go through mind.
later in the session.
Karen:
Pete, please can you take us through ‘Risk Not an issue at all Tony. Well, risk control
planning’? encompasses taking the best action, or actions,
available to identified threats and opportunities
Pete: from the available response types. We’ll talk
No problem Tony. more about this in the ‘Plan’ step of our risk
management procedure.
‘Risk planning’ is where we use environmental
scanning techniques like PESTLE to identify The next part of risk control is to assign a risk
risks, which, by the way, is regarded by owner, who owns all aspects of a risk assigned
PRINCE2 as a ‘supporting technique’. In to them, and perhaps ‘risk action owner’ as
addition, we’d aim to understand the type of well, who just does the action on behalf of the
each risk, such as sustainability, cybersecurity, owner, keeping them up to date. We’ll see this
financial or reputational. in the ‘Implement’ part of the risk management
procedure.
Irrespective of the technique used to identify
risks, it’s important that we describe them with The next part of controlling risks would be to
three elements, namely risk cause, risk event potentially ring-fence an explicit budget for
and risk effect. specific risk responses from the overall project
budget, and provide provision for currently
We’ll explore this more in the ‘Identify’ part of unknown risks.
our risk management procedure.
The final aspect of risk control is to think about
Next, risk guidance is provided on ‘Risk risk culture, noting earlier, that we said culture
analysis’. This will involve qualitative analysis, will influence the organization’s risk appetite,
such as assessing a risk’s impact and namely how risk loving or loathing the
probability, and assessing the proximity of the organization is.
identified threat or opportunity. Namely, if it’s
going to happen, when will it happen by? The key is that a supportive culture recognizes
that considering risk is a key part of decision-
Another thing we’ll analyse is the ‘velocity’ of a making. This then links to the concept of
risk. ‘decision-bias’, whereby mental shortcuts and
faulty thinking can result in less effective
This term is about how quickly a risk will start
decision-making.
impacting on the project’s objectives if it
occurs. Examples of decision bias include:
A risk matrix can then be used to plot risks at a • 'Optimism bias’, whereby
given moment in time, namely a snapshot of disadvantageous risk is discounted,
the risk environment. with an overly ‘sunny’ view of the
Scales for impact, on the x-axis, and probability situation
on the y-axis can be seen, with risks plotted • Loss aversion, which is where the
using their unique identifiers from the risk mindset values the avoidance of
register. losses more than making potential
gains
Risks above the risk tolerance line represent • Groupthink, a mindset where people
those that the business will not be able to feel unable to voice an alternative
tolerate, and these would have to be referred to view or perspective on a situation, and
the Project Board. finally
• Proximity, where risks closer in time
Tony: are seen as being riskier than those
That’s great Pete and revisiting the risk matrix further away.
will allow us to spot trends, to see whether
certain risks are getting more or less likely. Tony:
Thanks Karen, that was superb.
61
S3-5P11: Risk Management Procedure summary of each of these which can be viewed
Tony: by clicking the button shown on screen.
The risk management procedure that PRINCE2
recommends contains five steps. These are: If you remember the risk guidance on ‘risk
planning’, It is very important to clearly express
• Identify - which has two elements - the risk in terms of its;
Define context and objectives and
Identify threats and opportunities • Cause – the source of the risk, for
• Assess - which also has two elements example, because it rained a lot last
- Prioritize risks and Assess combined night
risk profile • The Event – the area of uncertainty,
• Plan for example, the river through
• Implement, and productive agricultural land may
overflow, and finally
• Communicate.
• The Effect – the description of the
The first four steps here are executed in impact, for example, leading to the
sequence and are iterative. The Communicate crops being damaged.
step will run in parallel, in order to
communicate any findings prior to the Or for an opportunity…
completion of the overall procedure. Because of increased adoption of home solar
As the project proceeds, new or updated photo voltaic systems (the cause) then fewer
information will become available. At this point, people may use their gas central heating over
some of the earlier steps may need to be winter (the event) leading to a reduction in CO2
revisited to achieve the best result. emissions from the housing stock and quicker
achievement of carbon neutral targets (the
Let’s consider each step in a little more detail effect).
here.
Pete, could you explain how we assess risks?
S3-5P12: Risk Management Procedure –

Identify S3-5P13: Risk Management Procedure -
Tony: Assess
The first element in risk identification is to Pete:
‘Define context and objectives’ of the project so Thanks Tony.
that an appropriate risk management approach Once identified, the risks should be assessed
can be established. in the ‘Prioritize risks’ element in terms of their
This will involve examining the project probability – how likely they are to occur and
mandate, the project brief and the project the impact on the project objectives should the
product description to understand the project's risk materialise.
objectives that are at risk so that the When assessing impact, it is very important to
appropriate amount of risk management can be consider the impact on the project’s objectives
undertaken. assuming you do nothing. For example, if there
It is important to recognize that risk is a risk that a competitor is launching a similar
management is not about ‘eliminating’ risk but product before yours is released it would have
rather to understand the risks and where no effect on your ability to release your product
appropriate take action to bring the risks to an on time. The impact is on the benefits of your
acceptable level. project, since you would lose market share.
Once the context and risk management It is usual for risks to be visualized in a ‘risk
approach has been established, the risks to the matrix’ as we saw in the ‘Risk analysis’ risk
project (both threats and opportunities) should guidance earlier, and information on impact and
be identified and recorded in the risk register, probability to be added to the risk register.
noting that risks can be identified at any point Next, in the ‘Assess combined risk profile’
during a project’s lifecycle. This is the ‘Identify element of the ‘Assess’ step, we need to
threats and opportunities’ element of ‘Identify’. consider the combined effect of the individual
There are many techniques that could be used risks to determine the overall risk exposure of
to identify risks including, review lessons, risk the project.
checklists, risk prompt lists, brainstorming and Typically, this is done using techniques like
risk breakdown structures. We’ve provided a expected monetary value, whereby the
62
probability of a risk is multiplied by its financial • Avoid – plan the activities differently in
impact, to give us the ‘expected value’. If we such a way that either the risk is
were to then add up all the expected value avoided altogether, or there is no
figures, with negatives for threats and positives impact, and
for opportunities, we get the ‘expected • Reduce – take some action to reduce
monetary value’ for the project. An indication of the probability and / or the impact.
how risky we are compared to other projects. This leaves you with what we call
‘residual’ risk, namely, the threat may
If risk exposure is greater than risk appetite, still happen, and it will have some
then actions would need to be planned in form of impact.
response.
Tony: And for opportunities, we have:

Thanks Pete – that was great. Definitions of
• Exploit – we take action so that the
risk exposure and risk appetite can be seen on
opportunity is realised. This is the
screen now.
‘mirror’ of avoiding a threat, and
• Enhance – we take action to make the
opportunity more likely to happen or
S3-5P14: Risk Management Procedure – increase the impact. This is the
Plan ‘mirror’ of reducing a threat.
Tony:
Once the risks have been assessed, the An easy way to remember these responses
appropriate mitigating actions can be that that for threats we have PASTAR, and for
considered, and one or more chosen. This opportunities we have PASTEE.
relates to the ‘Risk control’ element of the risk
guidance we saw earlier.
It is valuable to recognize that it may be S3-5P15: Risk Management Procedure –

important to consider and implement a range of Implement
options. For example, in considering the risk Tony:
that your house may be burgled, you may The primary goal of the ‘Implement’ step is to
choose to take out insurance, which is an put the chosen risk response (or responses)
example of risk transfer. You probably also lock into action. This links to the ‘Risk control’ part
your doors when you go out, which is an of the risk guidance we saw earlier.
example of risk reduction.
During this step, the plan will be amended to
Once a risk response has been taken, it may include the mitigating action and clear
be necessary to consider 'secondary risks', responsibilities will be defined for:
these are risks that relate to the new situation
• The risk owner – who will be a named
after the risk response has been implemented.
individual responsible for the
For example, if you were to change your route
management, monitoring and control
to avoid a potential traffic jam then you would
of all aspects of a particular risk
have to consider the new risks associated with
assigned to them, including the
your alternative route.
implementation of the selected
PRINCE2 suggests six basic responses for responses to address the threats or to
both threats and opportunities. maximize the opportunities, and
• The risk action owner – who owns the
The four common responses for both threats action to address the risk, This is
and opportunities are: important when the action is not in the
remit of the risk owner to control
• Prepare contingent plans – we put in
explicitly.
place a plan that will be put into action
should the risk occur
In some cases, it is likely that the risk owner
• Accept – where we make a conscious and risk action owner are the same person.
decision to live with the risk
• Share – we choose to share the loss S3-5P16: Risk Management Procedure –
should a risk occur, usually through a Communicate and the Risk Budget
contract Tony:
• Transfer – we transfer the risk to a The fifth step of the risk management
third party, again via a contract. procedure is ‘Communicate’ and it should be
carried out in parallel with the other steps.
Then for threats we have:
63
Information about risks is communicated both a useful insight on certain risks, informing your
within the project ecosystem and to external view on their probability and impact.
stakeholders from the organizational
ecosystem, for example to a programme office. Use of data generally gives a great insight into
the risks faced by a project and the
Risks are communicated in: relationships between them.
• Checkpoint reports Tony:

• Highlight reports Many thanks for that Pete.
• End stage reports
• End project reports
• Exception reports, and S3-5P18: The Risk Practice: Key
• Issue reports. Relationships with Principles of PRINCE2
Tony:
Consideration should also be given to the Finally, before we move onto an activity, we are
funding of risk mitigation actions. going to consider how the Risk practice
The money set aside for these activities is PRINCE2 principles across the PRINCE2
known as the risk budget and it forms part of lifecycle.
the project budget. Therefore, the more that is
spent on managing risks, the less there is for On screen you will see a table, which on the
other project activities. It is very important that left-hand side lists the seven PRINCE2
the money is used wisely and that risks are principles which we introduced earlier in the
carefully analyzed to prevent money being course, and that you can find outlined in the
wasted on low priority risks, or insufficient second chapter of the PRINCE2 eBook or
being spent to mitigate high priority risks. printed guide.
Thinking back to the risk guidance earlier, this The middle column shows how the Risk
is part of ‘Risk control’. practice achieves the principle by doing
something.
Finally, on the right-hand side, we have a

S3-5P17: Supporting Techniques - Use of column outlining how by doing something, this
Data results in something beneficial for the project.
Tony:
Having now run through the PRINCE2 So, for example, the Focus on products
technique for the risk practice embodied by the principle is achieved by understanding risks
‘risk management procedure’, it should also be associated with defining, developing, and
noted that PRINCE2 has some ‘supporting delivering both specialist and management
techniques’ in addition. products.
Pete, would you mind setting the scene and Resulting in… A clear understanding of the
then exploring this a bit further please? threats and opportunities relating to developing
the products in the project.
Pete:
No problem Tony. In short it shows how interconnected the
PRINCE2 method is.
Well, one of the ‘supporting techniques’ we’ve
mentioned already is the idea of ‘Horizon It shows how one of the five integrated
scanning’ in the form of PESTLE analysis or elements, a practice, relates to the
SWOT, namely strengths, weaknesses, achievement of principles, another integrated
opportunities and threats. element, throughout the lifecycle, namely
processes, which are another integrated
PRINCE2 alludes to how these supporting element.
techniques relate to the steps of the risk
management procedure. So, for example,
‘Horizon scanning’ relates to the ‘Identify’ step
of the risk procedure. S3-5P19: Activity
Tony:
One other supporting technique used On the screen, you will see the five steps of the
throughout the entire risk management PRINCE2 technique for risk (the risk
procedure is that of ‘Use of data’. management procedure) and a number of
statements relating to it.
Here, use of data analytics on data sets for
similar projects, products or activities can give Drag each statement onto the appropriate step.
64
When you are satisfied with your choices click products), is the responsibility of the Senior
“submit” to check your answer. Supplier.
An accessible PDF version of this activity can The Project Manager should consult
be found in Course Resources, which can be stakeholders to prepare and maintain the risk
accessed from the course menu or by selecting management approach and establish and
Ctrl, Alt + R on your keyboard. maintain risks in the risk register. Project
support may assist with the preparation and
The 5 steps of the PRINCE2 technique for risk maintenance of the project’s risk register.
(the risk management procedure) are:
The Project Manager should also ensure that
• Implement project risks are being identified, assessed and
• Identify controlled throughout the project lifecycle.
• Plan
• Assess, and Team Managers should participate in the
• Communicate. identification, assessment and control of risks,
whereas project assurance are responsible for
The statements to be matched to the steps are: advising the Project Manager with regard to the
risk management approach, and confirm to the
• Establish the risk management Project Board that the approach is compliant
approach with business policies.
• Inform the Project Board by highlight
reports
• The Project Executive should own this S3-5P21: Summary
risk Tony:
• The best thing to do is accept this risk We have now come to the end of our
• We could share this opportunity discussions about PRINCE2’s Risk practice.
• The risk may happen in three weeks
time You should now be able to:
• The marketing team can take the
• Explain the purpose of managing risk
actions
and the purpose of the risk budget
• Hold a brainstorming workshop
• Explain the purpose of the risk
• Review end stage reports for
management approach and risk
information to include
register
• The risk has a probability less than
• Describe guidance for risk
30%.
management including risk planning,
risk analysis, risk control and
S3-5P20: Risk Responsibilities consideration of risk culture
Pete: • Define risk as a threat or opportunity,
Finally, let’s have a look at risk responsibilities. risk responses, risk owners and risk
action owners, and
Providing the corporate risk management • Define the risk in terms of cause,
policy and risk management process guide is event and effect
the role of the business layer. • Define the difference between risk
probability, impact, proximity and
The Project Executive approves the risk
velocity, and finally
management approach and ensures it is
• Describe the PRINCE2 technique for
appropriate for the project’s objectives and the
risk, the risk management procedure.
business’ risk appetite. The Project Executive
also ensures that risks associated with the
business case are identified, assessed and
controlled and should escalate risks to the
business layer as necessary.
The Senior User must ensure that risks to the

users are identified, assessed and controlled,
such as the impact on benefits, operational use
and maintenance.
Ensuring that risks relating to supplier aspects

of the project are identified, assessed and
controlled (such as the creation of the project’s
65
Session 3-6: Practice: Issues
The definition of a ‘change’ can be seen on

Session 3-6: Practice: Issues screen now.
Issue management is at the heart of a project’s

S3-6P1: Introduction monitoring function, and needs to be
Tony: responsive to changes in the organizational
Welcome to this session where we shall and environment context. It’s important then
consider PRINCE2’s Issues practice. that members of the project team do not filter or
censor issues.
• Explain the purpose of the Issues

practice, including the purpose of a S3-6P3: Issues Practice – 2
change budget Tony:
• Explain the purpose of the issue The term ‘issue’ is defined as "an event
management approach, issue register relevant to the project that requires project
and issue report management consideration”.
• Describe the five different types of
issue, and Issues can be raised at any point in a project
• Understand the five steps in the by any team member or stakeholder. They’ll
recommended PRINCE2 issue then be captured in the project log, either within
management technique, or issue the daily log, informally, or the issue register,
management procedure by another formally.
name.
Issues that arise during a project could be of
the following types:
Let’s make a start by considering the purpose
of the Issues practice. • A request for change
• An off-specification
• A problem or concern
S3-6P2: Issues Practice – 1 • An event external to a project, or
Tony: • A business opportunity.
Change is inevitable during the life of a project,
and every project needs a systematic approach Let’s look at each in turn.
to the identification, assessment and control of
issues that may result in change.
As changes may arise from project team S3-6P4: Issues Practice – 3

members, stakeholder requests, complaints or Tony:
a wide range of other factors, PRINCE2 A request for change, is a request to change
provides a common approach to issue what we have previously agreed in the
management. baselined management product, such as the
stage plan or product description.
The purpose of the Issues practice in PRINCE2
is to collect and assess issues and control An off-specification is something that is
changes to the project’s baseline. delivered but that isn’t right, for example, not
fulfilling the quality specifications laid down for
PRINCE2 defines the project’s baseline as it, or perhaps, not delivered at all.
“the current approved versions of the
management products and project products A problem or concern requires distinction as
that are subject to change control”. problems have immediate negative impact,
whereas concerns need to be assessed in
The PRINCE2 guide is highlighting the terms of their timelines and impact.
relationship between issue and version control.
The inference being that unless you An event external to a project could be a
understand the version of something, how can supplier on the project going out of business,
you control changes to it? but has an impact on the project as we need to
find an alternative supplier.
For example, once approved, a stage plan
approved by the Project Board at the end stage Finally, a business opportunity. This last type of
assessment, becomes version 1.0. After this issue causes some confusion as people, rightly
point, if you want to change the scope of the think that opportunities are upside risks,
stage, either to add to the scope, or take things namely, good things that may happen.
out, it’s a type of issue. Specifically, a request
for change.
66
In this context though, we are talking about and off-specifications, as opposed to lower
something that has happened, not might severity, potentially more trivial things.
happen, that is having positive consequences
for the project, an ‘upside issue’ if you like. For The method of funding for changes is also
example, a competitor has gone out of known as the change budget, and is used to
business which will increase the benefits to be fund approved requests for change. Similarly,
realized from our project relating to sales to the risk budget, this is optional, but should
revenues. always accompany any delegation of authority
for changes.
Formal definitions of the types of issues that
arise can be seen on screen now. Please note It is essentially a ‘ring-fenced’ ‘pot’ of money to
that requests for change and off-specifications fund approved changes, noting that cost
come under the banner of ‘change control’, tolerance in a stage, does not get used to pay
whereas problems and concerns, an external for changes.
event to a project and a business opportunity
By default, the Project Board will make the
come under ‘issue resolution’.
decisions, but in most projects limited authority
Definitions for these can also be seen on for day-to-day changes will be delegated to the
screen. Project Manager.
By allowing the Project Manager to take

immediate action on low severity issues, and
S3-6P5: Approach to Change – 1 note this in the daily log, in effect the Project
Tony: Manager is being granted ‘change authority’ by
During Initiating a project, the controls for default.
addressing change and issues will be defined
and documented in the issue management
approach. As the project progresses this will be
S3-6P7: Informal and Formally Managed
kept under review and, if necessary, refined
Issues
and updated by the Managing a stage
Tony:
boundary process, which is where the PID is
reviewed and updated. Let’s move on to explore the use of
management products relating to issue and
These products are used as part of the change
change control.
control process:
The daily log can be considered the Project
• Issue management approach Manager’s diary, and is used to record,
• Daily log amongst other things, problems or concerns
• Issue register, and that the Project Manager can manage
• Issue reports. informally.
The issue management approach will Where an issue requires formal consideration
document the procedure for change control and then an issue report will be created and this
issue management. It will also specify the roles information will be documented within the issue
and responsibilities for change control and register.
issue management. Records, timing of
activities, assessment scales, and so forth are The issue report records information on one
also covered. formally managed issue, whereas the issue
register records information on all the formally
S3-6P6: Approach to Change – 2 managed issues.
Tony:
When thinking about changes, two of the most Both the daily log and issue register are part of
important aspects to be considered and the project log, which acts as a ‘container’ for
approved are the responsibility for agreeing to all the logs and registers in PRINCE2.
implement a change and the method of funding
for changes.
S3-6P8: PRINCE2 Technique - Issue
By default, the Project Board has the Management Procedure – 1
responsibility for agreeing to implement a Tony:
change, but this can be delegated to others, PRINCE2 provides a common and systematic
and is sometimes referred to as granting approach to dealing with issues. This process
‘change authority’. This ‘frees up’ the Project consists of five steps, these are: Capture,
Board, so they are being asked to make Assess, Recommend, Decide and Implement.
decisions on more severe requests for change
67
Let’s look at each in turn here: S3-6P10: PRINCE2 Technique - Issue

Management Procedure – 3
• Capturing issues – captured using Tony:
formal or informal communication Following the ‘Capture’ and ‘Assess’ steps of
channels, the issue needs to be the issue management procedure, we now
translated quickly and easily into an have ‘Recommend’ resolution.
issue report, which implies the issues
are being dealt with formally. Using information from the assessment, a
Immediate action might be able to be recommendation is made to the Project Board,
made on issues that are minor or whoever has the required change authority,
severity ‘problems or concerns’, in for a decision, for example to approve a
which case they will be entered on to request for change. The consequences of
the daily log and dealt with informally. going with the recommendation or making an
alternative decision, for example, to reject the
This is a matter of judgement though. request for change, should be made clear.
Capturing all issues, no matter how
trivial, will inundate the project The next step is deciding on changes. There
management team. But the other are a variety of ways to respond to different
extreme is a Project Manager filtering change proposals, for example, to approve,
and pre-judging all ‘problems and reject or request more information on a request
concerns’ in particular, deeming them for change, or to accept or reject an off-
minor severity. specification. To accept an off-specification is
essentially saying you can ‘live with it’.
• Assessing issues – When reviewing
issues, two questions need to be Finally, we have implementing changes. Here,
answered, namely: approved requests for change and off-
o Does it affect the project? specifications to be addressed, should be
o If so, how? recorded in the project log, and specifically, the
issue register. This may result in amended
plans or work packages to take the necessary
action, with records kept of superseded
versions.
S3-6P9: PRINCE2 Technique - Issue
Management Procedure – 2
Tony:
Many issues may not need an extensive S3-6P11: Activity
assessment, being more advisory in nature, Pete:
however, some may potentially be more severe Time for some multiple-choice questions.
and hence an integrated assessment may be Consider the following statement and decide
required with regard to the aspects of project how it should be categorized.
performance and their associated tolerances.
The Team Manager has reported that the work
The assessment will therefore consider the package will finish two days outside its
impact of the issue on: tolerance, but it can be completed within the
stage tolerance.
• The approved tolerances (for time,
cost, risk and scope) in terms of time, 1. A business opportunity
cost, quality and scope 2. Off-specification
• The project business case, especially 3. Problem/concern
in terms of the impact on benefits, and 4. None of the above.
on
• Other products or work packages.
S3-6P12: Activity
Ideally the assessment should be done with Pete:
input from a variety of project team members, Again, review the following statement and
and the Project Manager should be thinking of categorize it appropriately.
providing more than one way to respond to the
The supplier has gone out of business so the
issue in question to the Project Board.
product will not be delivered and the project
tolerance will be exceeded.
1. Request for change

2. Off-specification
3. An event external to the project
68
4. None of the above. the integrity of the complete solution.

Responding to requests for advice from the
Project Manager is also a responsibility of this
S3-6P13: Activity role.
Pete:
And what about this one? The Project Manager will of course raise any
issues to the Project Board. Other
The Senior User has requested a minor change responsibilities include managing the issue and
which can be incorporated quickly for no change control procedure assisted by project
charge. support where possible.
1. Request for change At team level, Team Managers will raise issues
2. Off-specification to the Project Manager and implement
3. Problem/concern corrective actions where necessary.
4. None of the above.
Advice on assessing and resolving issues will
be provided by project assurance.
S3-6P14: Activity
Pete: Project support will administer the issue and
Review and categorize this statement change control procedures, and assist the
appropriately. Project Manager to maintain the issue register
and project baseline.
The Project Manager has been made aware of
a team member breaking their leg in last night’s
charity football match.
S3-6P16: The Issues Practice - Key
1. Request for change Relationships with the Principles of
2. Off-specification PRINCE2
3. Problem/concern Tony:
4. None of the above. Finally, before we test our understanding with
some multiple-choice questions, let’s look at
how the Issues practice contributes to the
S3-6P15: Roles and Responsibilities adherence to the seven PRINCE2 principles
Tony: across the PRINCE2 lifecycle.
PRINCE2 defines a number of roles and
responsibilities relevant to the Issues practice. On screen you will see a table with the seven
PRINCE2 principles listed down the left-hand
At the highest level, the business layer will side. The principles were introduced earlier in
provide the corporate or programme strategy the course, and you can also find these
for change control, issue resolution and outlined in the second chapter of the PRINCE2
configuration management. eBook or printed guide.
The Project Executive will be responsible for The middle column shows how the Issues
determining if, and where, delegated authority practice achieves the principle by doing
for determining changes is needed, and something.
whether a project level change budget is
required, and if so, how much. They also set Finally, on the right-hand side, we have a
the stage level change budget. column outlining how by doing something, this
results in something beneficial for the project.
The Project Executive will also need to respond
to requests for advice from the Project So, for example, the Learn by experience
Manager and make decisions on escalated principle is achieved by using issue
issues with particular focus on continued management as a means to capture lessons
business justification. learned throughout the project lifecycle and
using lessons to inform responses to issues.
The Senior User may raise concerns in the
form of issues as well as make decisions on Resulting in… ensuring that project products
escalated issues which focus on safeguarding and delivery activities can continuously evolve
the expected benefits. Responding to requests and improve in a controlled manner in
for advice from the Project Manager is also a response to feedback.
responsibility of this role.
In short, it shows how interconnected the
The Senior Supplier may raise concerns in the PRINCE2 method is.
form of issues as well as make decisions on
escalated issues which focus on safeguarding It shows how one of the five integrated
elements, a practice, relates to the
69
achievement of principles, another integrated S3-6P20: Activity

element, throughout the lifecycle, namely Pete:
processes, which are another integrated Which of these correctly describes the type of
element. issue called an off-specification?
1. A proposal for a change to a baseline

2. An issue with an immediate and
S3-6P17: Activity negative impact
Pete: 3. A product that will not meet its quality
Time for a few more revision questions. specifications
4. An unanticipated positive
Which of these statements describes the
consequence for the project or user
purpose of the issue report?
organization.
1. To log all issue reports raised during
the project lifecycle, their current
status, and date of closure
2. To describe how issues will be S3-6P21: Summary
captured and reported, and explain Tony:
how changes to the project baseline This brings us to the end of our consideration
will be assessed and controlled of PRINCE2’s Issues practice.
3. To describe the issue’s impacts on the
project baseline, and identify ways to You should now be able to:
resolve the issue or address an off-
specification and recommend a • Explain the purpose of the Issues
decision practice, including the purpose of a
4. To record informal issues, required change budget
actions or significant events not • Explain the purpose of the issue
captured by other PRINCE2 management approach, issue register
management products. and issue report
• Describe the five different types of
issue, and
S3-6P18: Activity • Understand the five steps in the
Pete: recommended PRINCE2 issue
Which of the following is a purpose of the management technique, or issue
Issues practice? management procedure by another
name.
1. To collect and assess issues and
control changes to the project’s
baseline
2. To identify and record all off-
specifications
3. To escalate all issues to the Project
Board for action
4. To define the procedure for
configuration management.
S3-6P19: Activity
Pete:
Identify the missing word(s) in the following
sentence.
PRINCE2 defines the project’s baseline as “the

current approved versions of the [?] and
project’s products that are subject to change
control."
1. PID
2. Role descriptions
3. Specific
4. Management products.
70
Session 3-7: Practice: Progress
Session 3-7: Practice: Progress occurring such as the completion of a stage or

the authorization of a work package.
S3-7P1: Introduction The definition of time-driven and event-driven

Tony: controls can be seen on screen now.
Welcome to this session where we shall
consider PRINCE2’s Progress practice.
S3-7P3: Progress Controls
Tony:
• Explain the purpose of the Progress PRINCE2 applies the concept of ‘management
practice by exception’ as far as the Project Board is
• Outline the PRINCE2 technique for concerned. That is, having approved a stage
exception management - the plan, the Project Board is kept informed by
exception management procedure reports during the stage.
• Explain the difference between event- There is no need for ‘progress meetings’ during
driven and time-driven controls, and the stage. The Project Board knows that the
• Explain the way in which tolerances Project Manager will inform them immediately if
are set and exceptions are reported. any exception situation is forecast.
Let’s make a start by considering the purpose The main controls for the Project Board
of the Progress practice. include:
Authorizations: To authorize initiation, the

project, each stage and finally its closure.
S3-7P2: Progress Practice
Tony: Highlight reports: Regular progress reports
The main mission of any project management during a stage. These are prepared by the
method is to enable management at all levels Project Manager using information derived from
to exercise control over what has been planned checkpoint reports, which are produced at team
and approved. level.
The purpose of PRINCE2’s Progress practice Exception reports and issue reports: Early
is to establish mechanisms to monitor and warning of any forecast deviation beyond
compare actual achievements against those tolerance levels and issues requiring their
planned, to provide a forecast for the project attention.
objectives and continued viability, and control
any deviations causing an exception. Assessment of an exception plan: The Project
Board jointly considers what action to take in
Progress control involves measuring actual response to a forecast, or actual, deviation.
progress against the performance targets of
benefits, time, cost, quality, scope, The main controls for the Project Manager
sustainability, and risk. include:
It ensures that, for each level of the project Authorizations: Authorize work packages
management team, the level above can: including setting work package tolerances.
• Monitor progress Progress updates: Including checkpoint reports

from Team Managers or members.
• Compare achievement with plan
• Review plans and options against Exceptions and changes: Use of the daily log,
future situations issue register, product register, quality register
• Detect problems and identify risks and risk register during the stage.
• Initiate corrective action, and
• Authorize further work. It is also important that the lessons log is
updated as lessons are identified and a lessons
The definition of progress can now be seen on report is issued as appropriate during the
screen. project as well as at the end of the stage and
the end of the project itself.
PRINCE2 provides two types of progress
control throughout the project. These are time-
driven such as checkpoint and highlight reports
S3-7P4: Tolerance – 1
which are issued at a defined frequency and
Tony:
event-driven which represent a specific event
No project ever goes 100% according to plan,
and minor departures from plan will frequently
71
occur. To enable the project to progress Manager in order to get a decision on

smoothly without frequent and unnecessary corrective action.
communication between the different levels
within the project team, PRINCE2 defines Tolerances for time, cost, and scope are set in
tolerances for time, cost, quality, risk, benefit, the project plan, stage plan and work package.
sustainability and scope. Risk tolerance is set in the risk management
approach, stage plan and work package.
These are allocated initially by the business Quality tolerance is set in the project product
layer and then managed and implemented by description and the product descriptions and
the three levels of management in the project, finally, benefit tolerance is set for the project in
the Project Board, Project Manager and Team the business case.
Manager.
The business layer sits outside the project but

sets the overall requirements and tolerance S3-7P6: Progress Control Guidance – 1
levels for the project. The three levels of Tony:
management within the project, who are Pete, would you mind summarising the
responsible for directing, managing and guidance for progress control provided in
delivering, will manage and implement within PRINCE2?
these tolerances and escalate any forecast
Pete:
breaches of project tolerance.
Well, PRINCE2 has guidance around progress
The Project Board has overall control at a control which is inspired by the ‘Plan, Do,
project level, so long as forecasts remain within Check, Act’ cycle.
project tolerance, and they will allocate
First comes guidance levels around
tolerances for each stage to the Project
management levels and tolerance. We can
Manager. The Project Board has the ability to
see on screen that the business layer sets
review progress and decide whether to
project level tolerance, the Project Board sets
continue, change or stop the project.
stage level tolerance when they authorize each
During execution of the project plan, if any stage, and the Project Manager sets work
forecasts indicate that the project is likely to package tolerance when they agree the work
exceed the agreed project tolerances, then the package with the Team Manager.
deviation should be referred to the business
For each level of tolerance there are seven
layer by the Project Board in order to get a
tolerances areas, which reflect the aspects of
decision on corrective action.
project performance, or performance targets, in
PRINCE2.
S3-7P5: Tolerance – 2 The standard ones, traditionally, are time and

Tony: cost, perhaps using more of a traditional linear-
The Project Manager has day-to-day control for sequential delivery method. In a more of an
a stage within the tolerance limits laid down by Agile, iterative-incremental delivery method
the Project Board. During execution of a stage project, time and cost may be fixed, and it may
plan, if any forecasts indicate that the stage is be scope that is flexed using a suitable
likely to exceed the agreed stage tolerances, prioritization technique such as MoSCoW.
then the deviation should be referred to the
The next part of guidance relates to types of
Project Board by the Project Manager in the
progress control, which we noted earlier was
form of an exception report in order to get a
either event-driven, or time-driven. Most things
decision on corrective action.
in PRINCE2 are event driven, such as the need
Definitions of ‘tolerance’, ‘forecast’ and to escalate an exception situation, or an issue
‘exception’ can be seen on screen now. occurring.
Tolerances were defined earlier in the course,
As opposed to time-driven controls in
when talking about the Manage by exception
PRINCE2, which, if you remember, related to
principle.
use of the regular checkpoint report, which
The Team Manager has control for a work goes from Team Manager to Project Manager,
package, within the work package tolerances and the regular highlight report, which goes
agreed with the Project Manager. from the Project Manager to the Project Board
on a regular basis at pre-defined periodic
During execution of the work package, if any intervals.
forecasts indicate that it is likely to exceed the
agreed tolerances, then the deviation should be Tony:
referred to the Project Manager by the Team Thanks for that Pete.
72
S3-7P7: Progress Control Guidance – 2 This requires an open and honest culture to
Tony: support it, and the analysis of lessons should
Karen, would you mind continuing the answer five questions:
discussion on PRINCE2’s progress guidance?
• What did we expect to occur?
Karen: • What actually happened?
The next part of guidance around progress • What worked well and why?
control is ‘Reviewing progress and lessons’. • What did not work and why? and
• What needs to be done differently or
During a stage, in the process Controlling a
what needs to be repeated?
Stage, the Project Manager will be receiving
regular checkpoint reports, in a format and
Tony:
frequency set by the Project Manager, and will
That’s great Karen. The definition of a lesson
use these to review progress and update the
is on screen now.
project log. The stage plan will also be
updated with actual progress information, and it
is from these actual positions that they will be
forecasting whether they are still with their S3-7P9: Progress Control Guidance – 4
stage tolerance laid down by the Project Board. Tony:
Next in the guidance for progress control
During the stage, even when progress is comes ‘Reporting progress and lessons’.
apparently going as expected in terms of
products being delivered to the project, the The key here is that the frequency of reporting
Project Manager will be looking for trends, such can vary at different times in a project lifecycle,
as if the average number of unresolved issues reflecting the level of control required. For
appears to be increasing. example, if the team is highly experienced,
then less frequent reporting may be appropriate
The Project Manager needs to examine the generally, whereas, for an inexperienced team,
product register and quality register to see the Project Manager or Project Board may wish
whether this tallies with the physical state of to increase the frequency of reporting, until
specialist products. If there is a disconnect, for sufficient confidence has been gained in the
example, if the product register has status ‘in capability of the team.
development’ for a product, whereas the quality
register has a ‘fail’ status in the ‘result’ column PRINCE2 does not dictate the format and
for the same product, it indicates one or both presentation of reports, which could be verbal,
sets of information are incorrect. perhaps in a simple project using in-house
suppliers, or in larger more complex projects,
As such, assurance activities may be required then dashboards would be suitable, with
regarding the confidence in the reporting and access and availability to information in such
monitoring mechanisms and the data that reports outlined in the digital and data
underpins it. In short, ‘garbage in and garbage management approach.
out’, or ‘GIGO’ for short, is the concern. We’ll
talk more about the digital and data You can find suggestions for the ‘format’ of
management approach, which is part of the reports in PRINCE2 in Appendix A of the
PID, and the importance of systems and data PRINCE2 guidance.
which is integrated and accessible, later on.
Next, the guidance for progress control talks
about ‘Forecasting’, which is a word we’d
always associate with two other words…
S3-7P8: Progress Control Guidance – 3 ‘tolerance’, and ‘exception’.
Karen:
When reviewing progress, lessons are often To go into ‘exception’ is not when you have
identified, perhaps around why progress has broken tolerance, but rather, when you forecast
been slower than expected, or alternatively, to exceed the tolerance laid down for you, in
what has worked particularly well though a view of actually how it’s going, as opposed to
stage. how you thought or hoped it would go.
The principle of Learn from experience is key It’s all about ‘bothering the boss early’, and is
here then, and it’s important that the entire not a sign or weakness, but rather, a sign of
project team actively seeks, records, and strength. A supportive culture to is required to
incorporates relevant lessons throughout the enable this.
life of the project and shares them for future
projects. As we mentioned earlier, while time and cost
are quite often the focus, all seven PRINCE2
73
performance targets, and their associated the specialist products and the expectation of
tolerances, should be considered. outcomes and benefits.
As such, it makes sense to define an approach

to clarify how we will go about keeping the
S3-7P10: Progress Control Guidance – 5 project’s information secure, up to date,
Tony: accurate and accessible to those who need to
The next part of progress control guidance is make decisions and assess progress.
around ‘Escalation’. This will be the focus of
the PRINCE2 technique for exception The digital and data management approach is
management, which we’ll go into in a short part of the PID, and its purpose is twofold.
while. Firstly, “to describe: how digital technology will
be used to support project management and
The key distinction to make for now though, is project work”.
that if a Project Manager forecasts to exceed
the stage, or project’s tolerance, they are no And secondly, “to describe how data and
longer allowed to continue and need to information will be managed across the project
escalate the situation using an exception ecosystem and through the project lifecycle
report. and afterwards.”
If, however a Team Manager forecasts to The approach will explain how the data will be
exceed the work package tolerance laid down used and what digital technology will be used
for them by the Project Manager, then they for data analytics.
raise this via an issue, and not an exception
report, as it is assumed they are not using The ‘high level content’ of the approach is
PRINCE2. shown on screen if you want a closer look.
Next, we mention the final guidance area for Tony:

progress control, that of ‘Use of data and Thanks for that Pete.
systems in progress management’.
It’s often said that if your information on a

S3-7P12: Exception Management - 1
project is out of date, you are out of control,
Tony:
meaning if you are basing decisions on
Now we will consider the PRINCE2 technique
inaccurate, out of date progress information,
for exception management. Karen, would you
you are introducing huge risk of failure into your
briefly take us through that now please?
project.
Karen:
Luckily, good quality data and digital systems
Of course. We’ll briefly run through the
technology can help support progress tracking,
‘exception management procedure’ in
and hence decision-making. This is especially
PRINCE2, which acts as a nice reminder of
important with team members working from
things mentioned earlier in the session.
home, perhaps in distributed teams in different
time zones. You’ll see there is an accompanying diagram,
Figure 11.3 in the PRINCE2 guide, which has
Data analytics is the means of using and
numbered icons to denote various steps in the
analysing data to support effective decision-
procedure. We’ll now outline each here.
making or to bring efficiency through the
automation of tasks, and, using an empirical In step 1, the Team Manager forecasts that one
mindset, after having secured and stored the or more of the products in the work package
data through systems, then past performance will take the work package outside one of its
can be used to subsequently predict future tolerances, and therefore the Team Manager
performance. sends an issue to the Project Manager.
The Project Manager will then assess whether

the issue can be resolved within stage
S3-7P11: The Data Management Approach
tolerances or not. If it can’t be resolved within
Tony:
stage tolerances then they will need to send an
Pete, can you talk about the digital and data
exception report to the Project Board, which is
management approach?
step 2 in our diagram.
Pete:
Alternatively, if the issue can be resolved within
Well, we know information and data are one of
stage tolerances, then the issue will be noted in
our main ‘currencies’ on our project, other than
the next regular highlight report, to be sent by
74
the Project Manager to the Project Board, and If the chosen decision is made by the Project
an exception report would not be required. Board to request an exception plan, then we
move to step 4.
Moving onto step 2. In the situation where the
Project Manager forecasts to exceed their
stage tolerance, they are no longer authorised S3-7P14: Exception Management – 3
to continue and need to send an exception Pete:
report up to the Project Board as soon as In step 4, the Project Manager ceases the
possible, possibly giving warning in advance. current stage and introduces a stage boundary
to create the exception plan. Namely, the
This exception report will detail the situation Project Manager goes into the Managing a
with resolution options and a recommendation. stage boundary process early, and they hold a
planning workshop to come up with a
This report is sent from the Project Manager, in
replacement plan, called the exception plan,
the Controlling a stage process to the Project
which will replace the plan that has gone into
Board or Project Executive at the directing
exception.
level, along with any other relevant data to
assist in their decision. Specifically, they At step 5, in the Directing a project process, at
receive this during the ‘Give ongoing direction’ the activity ‘Authorize a stage or exception
activity. plan’, the Project Board or Project Executive
will either:
S3-7P13: Exception Management - 2 • Reject the exception plan and request

Tony: amendments from the Project
Continuing our look at the exception Manager
management procedure, Pete, please can • Reject the exception plan and direct
continue with step 3 please? the Project Manager to continue with
the stage. This may require minor
Pete: adjustments to the current stage, or
Yes Tony, well step 3 is where the Project • Approve the exception plan and return
Board think about what they could do in it to the Project Manager for further
response to the exception report with its action.
options and recommendation from the Project
Manager. During step 6 if the Project Board approve the
exception plan, the Project Manager will be
The options available to the Project Board directed to implement it as a new stage plan. In
when responding to the exception report are to effect, the exception plan becomes the ‘new’
either: stage plan.
• Reallocate the overall project The Project Manager, now back in the
tolerances to resolve the breach of the Controlling a stage process, authorizes the
stage tolerance next set of work packages for the delivering
• Re-prioritize requirements to bring the level to recommence, taking into consideration
stage back within tolerance, namely, the issue that triggered the exception.
de-scoping or re-scoping the offending
product It might be possible to align the end of the
• Inform the Project Manager that they stage with the original end point of the stage
require more time to consider their that went into exception, thus ensuring the
options planned end stage assessment proceeds as
• Implement the exception report and planned.
request an exception plan from the
Tony:
Project Manager, or finally
That was a great reminder Pete, of how we
• Implement the exception report by
often go into exception because of an issue,
escalating to the business layer for
not because we just felt like it!
advice and direction, if the exception
will take the project outside one or
more of its project level tolerances.
The business layer will provide S3-7P15: The Progress Practice: Key
direction to the Project Board, which Relationships with the Principles of
will then direct the Project Manager PRINCE2
accordingly. Tony:
Finally, we consider how the Progress practice
75
PRINCE2 principles across the PRINCE2 4. Forecast.

lifecycle.
On screen you will see a table, which on the S3-7P18: Activity

left-hand side lists the seven principles which Pete:
we introduced earlier in the course, and you Which role sets stage sustainability tolerance?
can find outlined in the second chapter of the
PRINCE2 eBook or printed guide. 1. The business layer
2. Project Board
The middle column shows how the Progress 3. Project assurance
practice achieves the principle by doing 4. Project Manager.
something.
Finally, the right-hand column outlines how by S3-7P19: Activity

doing something, this results in something Pete:
beneficial for the project. Which of these is an event-driven control?
So, for example, the Define roles, 1. Checkpoint report

responsibilities and relationships principle is 2. Highlight report
achieved by clarity on reporting requirements 3. Use of regular daily stand-ups by the
and responsibilities for progress management. Team Manager to assess work
package progress
Resulting in… more timely and effective 4. Authorizing a stage plan.
decisions being made on verified information.
In short, it shows how interconnected the S3-7P20: Summary

PRINCE2 method is. Tony:
This brings us to the end of our discussions
It shows how one of the five integrated
about PRINCE2’s Progress practice.
elements, a practice, relates to the
achievement of principles, another integrated You should now be able to:
element, throughout the lifecycle, namely
processes, which are another integrated • Explain the purpose of the Progress
element. practice
• Outline the PRINCE2 technique for
exception management, the exception
S3-7P16: Activity management procedure
Pete: • Explain the difference between event-
Time for a few questions on what we have driven and time-driven controls, and
covered so far in this session. • Explain the way in which tolerances
are set and exceptions are reported.
From the list shown, which is a time-driven
control? This concludes this session.
1. End stage assessment

2. Authorization of a work package
3. Highlight report
4. Assessment of an exception plan.
S3-7P17: Activity
Pete:
sentence.
The purpose of the Progress practice is to

establish mechanisms to monitor and compare
actual [?] against those planned; provide a
forecast for the project objectives and
continued viability; and control any deviations
causing an exception.
1. Progress
2. Performance
3. Achievements
76
Session 4-1: Processes: SU, IP
Session 4-1: Processes: SU, IP • There is a business justification for

moving into IP and this is documented
in the outline business case
S4-1P1: Introduction • That all the required authorities exist
Tony: for initiating the project
Welcome to this session where we shall • That there is enough information
consider PRINCE2’s Starting up a project and available to define and confirm the
Initiating a project processes. scope of the project within the project
brief
They are also known as SU and IP.
• The alternative approaches as to how
By the end of this session you will be able to: the project can be delivered have
been reviewed and a suitable project
• Explain the purpose, objectives and approach selected
context of Starting up a project • That we have appointed individuals to
process, SU, and Initiating a project do the work of IP and/or take
process, IP, and significant project management roles
• Recall the names of the activities in in the project
each process. • That we have planned the work to be
done in IP, and finally
Let’s make a start by considering the SU • That we are not wasting time initiating
process. a project based on unsound
assumptions relating to scope, time,
acceptance criteria and constraints.
S4-1P2: Starting Up a Project – 1
Tony: Pete, could you tell us more about the context
The Starting up a project process provides a of the Starting up a project process?
solution to the commonly encountered problem
of a lack of objectivity and planning right at the
start of a project. Its purpose is to ensure that S4-1P4: More about the Context
the prerequisites to Initiating a project are in Pete:
place by answering the question: Do we have a Yes of course Tony.
viable and worthwhile project?
You’ll remember that we mentioned earlier in
The input to Starting up a project is the project the course that the SU process is triggered by
mandate, which will vary in format depending the project mandate.
on the amount of preparatory work done. For
example, if a feasibility study has been If the project is part of a programme, then the
completed then the information in the project programme will provide the project brief and
mandate will be extensive. appoint some, if not all, members of the Project
Board.
At the other extreme the project mandate could
be a short, less formal request to provide some In this case the Project Manager should
new facility. It should provide the terms of validate what has been provided and, if
reference for the project and should contain appropriate, make recommendations for
sufficient information to identify at least the modifications.
prospective Project Executive of the Project
Board. The mandate is refined into the project The preparation of the outline business case
brief during Starting up a project. and the project brief are parallel and iterative
activities and involve the Project Manager, the
The purpose of SU is as much about stopping Project Board members and other key
poorly conceived ideas being initiated as it is stakeholders, who will have frequent
about approving viable projects. It is a much communications.
lighter process than IP and the aim is to do the
minimum necessary to decide whether it is The more time we spend getting the
worthwhile to proceed, or not. requirements clear during SU, the more time
we will save during the delivery phase because
we will avoid many issues, exceptions and re-
planning caused by poor requirements capture
S4-1P3: Objectives at the beginning.
Tony:
The SU process has seven key objectives to Remember that the amount of time spent in SU
ensure that: will vary from project to project, depending on
the amount of detail in the project mandate and
77
that the contents of the project brief will be outline business case to them, along with other
extended and refined during IP to create the elements of the project brief.
project initiation documentation or PID.
In summary the outputs of Starting up a project
are:
S4-1P5: Starting up a Project – 2 • The project management team

Tony: • The project brief
Although the Starting up a project process • The project approach
should not take very long, PRINCE2 identifies • The plan for the initiation stage, and
eight activities, as shown. • The lessons log and the daily log
The first activity is ‘Appoint the Project
Executive and the Project Manager’. The S4-1P6: Activity
commissioning organization will appoint the Pete:
Project Executive of the Project Board and then Time for a few questions
the Project Executive can appoint an
appropriate Project Manager to undertake the Which two products are produced during
work of this and subsequent processes. Starting up a project?
The next activity, ‘Assess previous lessons’, A. Project mandate

ensures that any relevant lessons from B. Project initiation documentation
previous projects can be taken into account C. Project brief
whilst undertaking this project. The lessons log D. Plan for the initiation stage.
is created and populated with relevant lessons Choose from the following answers:
from previous projects. Subsequent lessons
are added to this log. 1. A and B
2. B and C
In order to progress with the project, the project 3. C and D
management team must be put in place. This is 4. A and D.
undertaken in the activity ‘Appoint the project
management team’.
S4-1P7: Activity
Any project must have a justification and this Pete:
must be apparent from the beginning. The What triggers the Starting up a project
‘Prepare the outline business case’ activity puts process?
together an outline business case, and the
project product description, both of which will 1. Project mandate
be refined during the initiation stage. 2. Programme brief
3. Feasibility study report
The way in which the solution will be delivered, 4. Project brief.
for example, in-house or commercial off the
shelf delivery models, and also the delivery
method, such as iterative-incremental or linear- S4-1P8: Activity
sequential is described in the project approach, Pete:
as outlined in the ‘Select the project approach’ Identify the missing word(s) in the following
activity. sentence.
This is subsequently included in the project In the process SU the [?] is the first project
brief during the ‘Assemble the project brief’ management team role to be appointed.
activity. Essentially, the project mandate is
1. Project Board
developed into the project brief which states
2. Project Manager
the scope and definition of the project.
3. Project Executive
It is necessary to make sure the work that will 4. Senior User.
be undertaken during the initiation stage is
understood as it will take time and consume
S4-1P9: Activity
resources. This work is identified and
Pete:
scheduled in the ‘Plan the initiation stage’
Which two are objectives of the SU process?
activity.
A. To produce a PID
Finally, we have the activity ‘Request project
B. To document the business justification
initiation’ which is where the Project Manager
C. To stop projects which are poorly-
formally requests the authority from the Project
conceived being initiated
Board to initiate the project, presenting the
78
D. To determine the schedule for the S4-1P12: Initiating a Project

project. Tony:
Choose from the following answers: Using the outputs from Starting up a project,
the project initiation documentation is
1. A and B assembled during the final activity of Initiating a
2. B and C project.
3. C and D
4. A and D. The process comprises seven activities in total.
• Agree the tailoring requirements

S4-1P10: Purpose and Objectives of IP • Agree the management approaches
Tony: • Establish project controls
Once the project brief is approved the project • Prepare the project plan
will officially start and move into the initiation • Prepare the full business case
stage and we will use the IP process. • Assemble the project initiation
The purpose of IP is to establish solid documentation, and
foundations for the project so that the • Request project authorization.
organization can understand the work that
needs to be done to deliver the project’s The project initiation documentation and the
products before committing to significant next stage plan are approved by the Project
expense or resources. Board at the end of this stage
There are ten objectives of the process and

these are shown here. Take a few minutes to S4-1P13: Activity
study these before moving on to the next page. Pete:
Time for a few more revision questions.
S4-1P11: Context of IP From the list shown can you identify two of the
Tony: objectives of the IP process?
If the organization proceeded directly from SU A. Explain how the quality required will
into delivery it risks committing significant funds be achieved
and resources to the project without fully B. Agree the project approach
understanding the project’s objectives and how C. Document the outline business case
it might be achieved. D. Define who needs information, in what
By using IP we can lay down the foundation format, and at what time.
required to achieve a successful project. Choose your answer from the following options:
This makes sure the Project Board can decide 1. A and B

whether or not the project is sufficiently aligned 2. B and C
to the business objectives. 3. C and D
4. A and D.
IP provides information to all the stakeholders
about what the project must achieve, why it’s
needed and how the outcome is to be achieved S4-1P14: Activity
and what their responsibilities are. Pete:
What is the main output of IP?
If the relationship between the user and
supplier is commercial the whole process will 1. Project initiation documentation (PID)
need further consideration. 2. Project brief
3. Project mandate
Finally, during this process the Project Manager 4. Project product description.
will create a suite of management products,
and, as part of the plan for this stage, the
Project Manager must agree how the S4-1P15: Activity
documents are to be agreed, for example all at Pete:
once, assembled into the project initiation Identify the missing word in the following
documentation, or as they are produced. sentence.
The purpose of IP is to establish solid [?] for

the project so that the organization can
understand the work that needs to be done to
deliver the project’s products before committing
to significant expense and resource.
79
1. Foundations
2. Scope
3. Requirements
4. Costs.
S4-1P16: Activity
Pete:
Which of these is an objective of IP?
1. To produce an outline business case

2. To appoint the project management
team
3. To describe how risks and issues will
be identified, assessed and controlled
4. To gather sufficient information to
define and confirm the scope of the
project.
S4-1P17: Summary
Tony:
This brings us to the end of our considerations
of SU and IP.
• Explain the purpose, objectives and

context of SU and IP, and
• Recall the names of the activities in
each process.
80
Session 4-2: Processes: CS, MP, SB
Session 4-2: Processes: CS, MP, S4-2P3: CS Purpose and Objectives

Tony:
SB The purpose of CS, therefore, is to assign work
to be done, monitor such work, deal with issues
S4-2P1: Introduction as they arise, report progress to the Project
Tony: Board and take corrective actions to ensure
Welcome to this session where we shall that the stage remains within the tolerances set
consider three PRINCE2 processes, namely by the Project Board.
Controlling a stage, or CS, Managing product
CS has five objectives and these are to ensure:
delivery, or MP, and Managing a stage
boundary, or SB. • That attention is focused on delivering
the stage’s products, and any
movement away from the products
• Explain the purpose, objectives and and direction delivery method agreed
context of CS, MP and SB, and at the start of the stage is monitored to
• Recall the names of the activities in avoid uncontrolled change and loss of
each of these processes. focus
• That risks and issues are kept under
Let’s make a start by considering the controlled
Controlling a stage, or CS, process. • That the business case is kept under
review
• CS should also ensure that the agreed
products for the stage are delivered to
S4-2P2: Controlling a Stage
the stated quality standard
Tony:
expectations and are accepted, within
Following the Project Board’s decision to
cost, time and effort targets and to
approve a stage, the project management team
make sure they are ultimately in
must be fully focused on the delivery of the
support of the agreed benefits, and
products within the stated tolerances.
finally,
This involves using three processes: • That the project management team is
focussed on delivery within the
• The Controlling a stage process, established tolerances.
which forms the main part of the
Project Manager’s work and provides
the direction for the day-to-day
management of the stage and the
S4-2P4: MP Purpose and Objectives
overall project
Tony:
• Managing product delivery, which is
The purpose of the Managing product delivery
where the teams will undertake the
process, or MP, is to control the link between
work itself, and
the Project Manager and the Team Manager or
• Managing a stage boundary, which Managers, by agreeing the requirements for
prepares for the end stage acceptance, execution, reporting and delivery
assessment with the Project Board. of specialist products.
Throughout a management stage CS is used to The Team Manager’s role is to coordinate an
create a cycle of: area of work that will deliver one or more of the
project’s products and they can be internal or
• Authorizing work to be done external to the customer’s organization that
• Monitoring progress of the work, form the project product. Team Managers can
including signing off completed work be internal or external to the organization
packages running the project.
• Reviewing the situation and triggering
new work packages, and MP has four objectives. These are to ensure:
• Reporting highlights.
• That work on products allocated to the
Usually, the CS process is first used after the team is authorized and agreed
Project Board authorizes the project, but it may • That Team Managers, team members
also be used for the initiation stage, especially and suppliers are clear about what it
for large or complex projects. to be produced and what is the
expected effort, cost or and
timescales
81
• That the planned products are sure that risks and issues are under control
delivered to quality expectations and and, if necessary, triggering corrective action.
within tolerance, and finally
• That accurate progress information is Periodically, the Project Board will need to be
provided to the Project Manager at an informed of progress. At the frequency defined
agreed frequency to ensure that by the Board, the Project Manager will issue a
expectations are managed. highlight report as described in the ‘Report
highlights’ activity.
There are three four activities in MP and these
are:
S4-2P6: Controlling a Stage
• Accept a work package Tony:
• Execute a work package and The final activity group associated with issues
• Evaluate a work package, and involves capturing the issue or risk.
• Notify work package completion.
Issues that can be managed informally should
be noted in the daily log, otherwise they should
S4-2P5: Managing Product Delivery be entered into the issue register and analyzed
Tony: further.
Let’s consider the interaction between
Controlling a stage and Managing product Risks should be entered into the risk register. If
delivery in a little more detail. the issue or risk cannot be resolved within
tolerance, then it will need to be escalated to
Firstly, the work packages group has three the Project Board via an exception report using
activities: the ‘Escalate issues and risks’ activity.
• ‘Authorize a work package’ Finally, any action required to maintain the

• ‘Evaluate work package status’, and project schedule is taken via the ‘Take
• ‘Receive completed work package’. corrective action’ activity. This can involve
modifying an existing work package or creating
Basically, the Team Manager and the Project a new one.
Manager will discuss the content of the work
package description and the Team Manager Pete, could you run through a few questions
agrees to undertake the work in the manner and then get us started with the Managing a
described in the work package description. This stage boundary process please.
is the first activity in Managing product delivery
(‘Accept a work package’).
S4-2P7: Activity
As the work progresses in ‘Execute a work Pete:
package’, the Team Manager will send Of course, Tony.
checkpoint reports to the Project Manager via
the activity ‘Evaluate a work package’, and the Let’s get started with a few questions on what
Project Manager will review these in ‘Evaluate we’ve covered so far.
work package status’ in the Controlling a stage
process. Firstly, which two activities are used in the
process Managing product delivery?
When the work is completed, the Team
Manager will advise the Project Manager via A. Execute a work package
the ‘Notify work package completion’ activity. B. Evaluate a work package
The Project Manager will consider this in the C. Evaluate work package status
‘Receive completed work package’ activity and D. Authorize work packages.
will ensure all the work has been completed Choose from the following answer choices:
prior to signing off the work package.
1. A and B
Whilst all this activity is proceeding, the day-to- 2. B and C
day monitoring and reporting must be 3. C and D
considered via two activities, ‘Evaluate stage 4. A and D.
status’ and ‘Report highlights’.
‘Evaluate stage status’ requires the Project S4-2P8: Activity

Manager to look at the ‘big picture’ of the Pete:
project. This means looking at what has What name is given to the report issued to the
happened versus what was expected, Project Manager by the Team Manager on a
reviewing the next chunk of work and making regular basis?
82
1. Progress report submitted to the Project Board for approval in

2. Highlight report the same way as a stage plan.
3. Checkpoint report
4. Work package report.
S4-2P9: Activity
S4-2P12: SB Objectives
Pete:
Pete:
There are a number of objectives associated
following sentence.
with SB. In the normal course of events, they
The Project Manager sends the Project Board are to:
a [?] report at a frequency decided by them.
• Assure the Project Board that all
1. End project products in the current stage plan
2. Checkpoint have been completed as defined.
3. End stage • Prepare the stage plan for the next
4. Highlight. stage
• Review and, if necessary, update the
PID, in particular the business case,
S4-2P10: Activity project plan, the project approach and
Pete: the project management team
Which two are objectives of the Controlling a structure and role descriptions
stage process? • Provide the information needed for the
Project Board to assess the continuing
A. Risks and issues are controlled
viability of the project.
B. The planned products are delivered to
• We should also record any lessons or
quality expectations and within
information that can help later stages
tolerance
or other projects, and
C. Work on products allocated to the
team is authorized and agreed • Request authorization to start the next
D. The business case is kept under stage.
review.
Choose from one of the following options: When dealing with exceptions, the objectives of
SB are similar to the ‘normal’ ones, with the
1. A and B exception that ‘Preparing the plan for the next
2. B and C stage’, as an objective, is replaced by
3. C and D ‘Preparing an exception plan’, and the
4. A and D. requested authorization is not for the next
stage, but rather, to replace the current stage
or project plan with the exception plan.
S4-2P11: SB Purpose
Pete: SB has these objectives:
Let’s move on now to consider Managing a
stage boundary or SB. • To review and if necessary update the
PID, in particular the customer’s
The purpose of SB is to enable the Project quality expectations, project
Manager to provide the Project Board with approaches, controls and role
sufficient information to be able to: descriptions
• To provide the information needed for
• Review the success of the current the Project Board to assess the
management stage continuing viability of the project
• Approve the next stage plan • To prepare an exception plan as
• Review the updated project plan, and directed by the Project Board and
to • To seek approval to replace the
• Confirm the continued business project or stage plan for the current
justification and acceptability of risks. stage with the exception plan.
The process is executed at, or close to the end

of, each management stage. SB is not used in the final stage of the project
unless an exception plan is needed. This is
Because projects don’t always go to plan the because the activities needed to review the
Project Board may request that the current whole project and the performance of the final
stage, and possibly the project, is re-planned. stage are included within the Closing a project
The exception plan is prepared in SB and process.
83
S4-2P13: Managing a Stage Boundary 2. Stage

Tony: 3. Team
In the normal course of events, five activities 4. Project.
will be completed leading to the main outputs
which are, an end stage report, a stage plan for
the next stage, and a request to approve the S4-2P17: Activity
next stage plan. Pete:
Which statement is correct?
In the event that a stage or project is in
exception then the first activity will be replaced 1. Managing a stage boundary is used in
with the ‘Prepare the exception plan’ activity every stage
and the outputs will be an exception plan, an 2. Managing a stage boundary is not
end stage report, if requested by the Project used in the final stage unless an
Board, and a request to approve the exception exception plan is required
plan. 3. Managing a stage boundary is never
used in the final stage
The outputs of Managing a stage boundary 4. Managing a stage boundary is used to
feed into the Directing a project process, in prepare exception reports.
particular ‘Authorize a stage or exception plan’
S4-2P14: Activity S4-2P18: Summary

Pete: Tony:
Time for a few more questions. This brings us to the end of our discussions of
CS, MP and SB.
Which two products are produced under normal
circumstances during the Managing a stage You should now be able to:
boundary process?
A. Exception plan context of CS, MP and SB, and
B. Highlight report • Recall the names of the activities in
C. Stage plan each process.
D. End stage report.
Choose your answer from the following options: This concludes this session.
1. A and B
2. B and C
3. C and D
4. A and D.
S4-2P15: Activity
Pete:
Which plan may the Project Board request if
the stage has deviated from its tolerance and
an exception report has been raised?
1. Exception plan
2. Replacement stage plan
3. Replacement project plan
4. Replacement stage and project plan.
S4-2P16: Activity
Pete:
sentence.
The purpose of Manging a stage boundary is to

enable the Project Manager to provide the
Project Board with sufficient information to be
able to review the updated [?] plan.
1. Exception
84
Session 4-3: Processes: CP, DP
Session 4-3: Processes: CP, DP operational support function in place

to maintain the products in BAU
• To review the project’s performance
S4-3P1: Introduction against its baselines
Tony: • To assess any benefits that have
Welcome to this session where we shall already been realized and update the
consider PRINCE2’s Closing a project and benefits management approach to
Directing a project processes. They are also include benefits reviews after the
known as CP and DP. project has closed, and finally
• To ensure that provision has been
made to address all open issues and
• Explain the purpose, objectives and risks with follow-on action
context of CP and DP, and recommendations.
each process. S4-3P4: CP Context
Tony:
Let’s make a start by considering Closing a As we said earlier, projects should always
project. come to an end and this gives us a number of
advantages.
S4-3P2: Closing a Project A clear end to a project is always more

Tony: successful than a slow drift into use. It
If an undertaking is to be managed as a provides us with an opportunity to:
project, by definition, it must be finite and come
• Recognise that the original, or
to a clearly defined end. Otherwise, an
changed, objectives have been met
operational management approach would
• To make sure everyone knows the
probably be more appropriate.
project has finished
The end of a project may arise when all the • To make sure responsibility for
planned work has been completed and the ongoing operations and maintenance
products finished and signed-off. of the products has been confirmed by
the agreed owners
Alternatively, a project may be brought to a • To disband the temporary project
premature conclusion because of changes in organization, and
requirements, lack of resources or • To make sure we do not continue to
unacceptable slippage in cost or time. incur cost to the project.
In any event the purpose of CP is:
Closure should be planned as part of the stage
• To provide a fixed point at which
plan for the final stage of the project.
acceptance for the project product is
confirmed Once the Project Board have confirmed the
• To recognize that objectives set out in project closure the Project Executive should
the project initiation documentation notify the business layer that the project is
have been achieved, or closed.
• To recognize that any approved
changes to these objectives have If for any reason the project is brought to a
been achieved, or premature close, the CP process will still need
• To recognize that the project has to be executed.
nothing more to contribute.
S4-3P5: Closing a Project's Activities

S4-3P3: CP Objectives
Tony:
Tony:
There are five activities associated with Closing
The Closing a project process has five
a project, these are:
objectives which are:
• Prepare planned closure
• To verify that the user accepts the
• Prepare premature closure
project product
• Confirm project acceptance
• To ensure that the business is able to
• Evaluate the project, and
support the products when the project
is closed, in other words there is an • Request project closure.
85
In ‘Prepare planned closure’ the Project 1. There is always a final closure stage
Manager closes the project log, and ensures all to a PRINCE2 project
project information is secured and archived. 2. Benefits are realized before the
They will then prepare a draft project closure project closes
notification and consult the communication 3. Closing a project is planned as part of
management approach as to which stakeholder the planning for the final stage of the
groups need to be informed about closure. project
4. The Project Executive is responsible
If the project has been brought to a premature for closing a project.
close then the Project Manager must ensure
that, rather than simply abandoning any work
still in progress, the project it is brought to an S4-3P8: Activity
orderly close and that anything that can be Pete:
salvaged has been, and that whatever remains Identify the missing word or words in the
to be done is raised to the business layer. following sentence.
In either event the remaining activities must be One of the objectives of Closing a project is to
completed – the products are handed to the review the project’s performance against [?].
operational and maintenance environment and
the Project Manager ensures that mechanisms 1. Its baselines
are in place to realize the benefits post-project. 2. Its performance targets
3. The user's quality expectations
The Project Manager should evaluate the 4. The corporate management
project against the project initiation processes and procedures.
documentation as baselined at the end of the
initiation stage and create an end project report
and a Lessons report. S4-3P9: Activity
Pete:
Finally, the Project Manager should Which two of the following are objectives of the
recommend to the Project Board that the Closing a project process?
project is closed, and that they celebrate the
success of the project, using the ‘Request A. To review the project’s performance
project closure’ activity B. To ensure provision has been made to
address all open issues and risks, with
follow-on action recommendations
C. To realize benefits
S4-3P6: Activity D. To determine the value of the benefits
Pete: in the business case.
Time for a few questions.
Choose your answer from the following options:
Which two are reasons why a clear end to the
project is better than a gradual drift into 1. A and B
operational use? 2. B and C
3. C and D
A. Provides an opportunity to realise
4. A and D.
benefits during the final stage
B. Provides an opportunity to tell
everyone the project is finished S4-3P10: Directing a Project
C. Provides recognition that the original, Pete:
or changed, objectives have been met Directing a project runs from the end of the
D. Ensures that there is a final closure Starting up a project process until the very end
stage to the project. and final close-down of the project.
Choose from the following answer choices: This process is used exclusively by the Project
Board who should manage by exception,
1. A and B monitor through reports provided by the Project
2. B and C Manager and control via a series of key
3. C and D decision points.
4. A and D.
There are five activities within DP, as shown:
S4-3P7: Activity • Authorize initiation approves the work

Pete: undertaken during Starting up a
Which statement is true? project, and authorizes the official
start of the project.
86
• Authorize the project approves the Fundamentally, this means the Project Board is
outputs of the initiation stage, namely the decision-making body, and that each stage
the project initiation documentation, of the project is authorized, the Project
and makes sure the project has a Manager is supported and that there is a focus
sound foundation before making any on the project’s benefits and their realization.
major commitments.
• Authorize a stage or exception plan
approves the plans for the next stage S4-3P12: DP Context
of the project, or if the stage or project Tony:
is in exception, then the exception Before we try a few more questions Pete, can
plan will require approval. This you just summarize the key contextual points
process ensures that the Project about DP and the Project Board’s role for us
Board review the project at the end of
each stage and that it is still worth Pete:
doing. Thanks Tony.
• Give ongoing direction covers the
informal communication with the The Project Board manages by exception and
Project Board and enables them to only meets to make decisions at key points.
respond to reports during a stage, There should be no need for any other
plus also inform the Project Manager progress meetings.
about any external influences such as
The Project Board and the business layer must
changes to business priorities, and
maintain regular contact throughout the project
finally
and this will be documented in the
• Authorize project closure enables the communications management approach.
Project Board to be sure that the
project has been completed to their The Project Board should maintain a dialogue
satisfaction before disbanding the with the Project Manager providing ongoing
project team and infrastructure. If the advice and guidance as necessary.
project has been closed prematurely
then this process is still completed to If the Project Board is unable to provide a
make sure that the project has been single view then the Project Manager should
brought to an end in an efficient defer to the wishes of the Project Executive.
manner.
Finally, DP provides the mechanism for the
Project Board to assure itself that there is a
This process does not cover the day-to-day
continued business justification for the project
activities; these rest with the Project Manager
which it achieves by authorizing each stage of
the project, or an exception plan if one is
required.
S4-3P11: DP Purpose and Objectives
Tony:
The purpose of DP, therefore, is to enable the
S4-3P13: Activity
Project Board to be accountable for the
Pete:
project’s success by making key decisions and
Time for a few more questions.
exercising overall control while delegating the
project’s day-to-day management to the Project Which two activities are part of Directing a
Manager. project?
The objectives of DP are to ensure that: A. Authorize the project
B. Confirm project closure
• There is authority to initiate the project
C. Confirm the business case
• There is authority to deliver the project D. Give ongoing direction.
product Choose your answer from the following options:
• The necessary management and
control is provided and the project 1. A and B
remains viable 2. B and C
• The business layer has a connection 3. C and D
to the project 4. A and D.
• That there is authority to close the
project, and finally
• That the plans for realizing the post-
project benefits are managed and
reviewed.
87
S4-3P14: Activity
Pete:
Which PRINCE2 principle reflects this
statement:
“The Project Board only meets to make

decisions, it does not have regular progress
meetings”?
1. Manage by exception
2. Manage by stages
3. Define roles, responsibilities and
relationships
4. Tailor to suit the project.
S4-3P15: Activity
Pete:
following sentence.
If the Project Board cannot provide a unified

answer the Project Manager should defer to the
[?].
1. Business layer
2. Senior Supplier
3. Senior User
4. Project Executive.
S4-3P16: Activity
Pete:
When does the process Directing a project
start?
1. As soon as the project mandate is

issued
2. At the end of Starting up a project and
before the start of Initiating a project
3. At the end of the first stage
4. At a time dictated by the Project
Executive.
S4-3P17: Summary
Tony:
This brings us to the end of our considerations
of Closing a project and Directing a project
processes in PRINCE2.

context of CP and DP, and
each process.
88
Session 4-4: Process Model Walkthrough
Session 4-4: Process Model request’ invokes the process of Directing a

project.
Walkthrough
S4-4P1: Introduction S4-4P3: Process Model Walkthrough – 2

Tony:
Tony:
Assuming the Project Board approve the
Welcome to the final session of the PRINCE2
project initiation documentation, which includes
process section.
the detailed business case and benefits
Having reviewed each of the processes in turn, management approach, they, having also
we will now walk through a project, from the approved the next stage plan, will issue a
issuing of the project mandate to finally closing ’Stage authorized’ trigger to start the second
the project. stage of the project.
This is very similar to the PRINCE2 Journey From now until the end of the stage the
which you studied in session 2 and will act as a management of the project will involve cycling
refresher of the whole process model. through the Controlling a stage and Managing
product delivery processes as work packages
So, let’s get started. are authorized and work is undertaken by the
Team Managers and their teams.
As the work progresses the Project Manager

S4-4P2: Process Model Walkthrough – 1 will be reviewing progress of the work
Tony: packages and the project overall, taking
The project mandate triggers the first process corrective action to keep things on track. As
Starting up a project which aims to answer the requested, the Project Manager will issue
question “do we have a viable and worthwhile highlight reports to the Project Board, keeping
project”? them up to date and enabling them to manage
As we work through the Starting up process, by exception.
we will identify any lessons that can be applied A key part of the Project Manager’s work during
from previous projects and appoint the people the stage will be monitoring the status of
required to fill the roles in the project team. existing issues and risks, capturing new ones,
Other activities include preparing the project examining them and if necessary, escalating
product description and deciding how to them to the Project Board if they cause a
provide the solution, documenting this in the forecast breach of tolerances that put the stage
project brief and the project approach. or project into exception.
The outline business case will be prepared to
ensure we know why we’re doing the project
and finally the work that will be undertaken S4-4P4: Process Model Walkthrough – 3
during the initiation stage will need to be Tony:
planned and documented in the initiation stage As the Team Managers execute the work
plan. package, they will build the products and check
their quality. As the work packages are
When all this is complete, we can use the completed, they will advise the Project
activity ‘Request project initiation, which Manager via the activity ‘Notify work package
triggers the process of Directing a project completion’, and the associated trigger,
where we find the Project Board and submit the ‘Completed work package notice’.
project brief and initiation stage plan to the
Project Board for approval. This cycle of production between Controlling a
stage and Managing product delivery is
Once the Project Board has authorized the eventually broken when, towards the end of the
initiation of the project, they will issue the stage, Controlling a stage outputs a trigger
‘Project initiation authorized’ trigger to start the ‘Stage boundary approaching’ to the Managing
Initiating a project process. a stage boundary process.
The Project Manager and team will complete If all is going well, Managing a stage boundary
the initiation activities, which will culminate in will produce a stage plan for the next stage and
the assembly of the project initiation an end stage report, which along with the
documentation. The Project Manager will then updated benefits management approach,
use the activity ‘Request project authorization’, business case and project plan included in the
which, via the trigger ‘Project authorization updated project initiation documentation, will
give the Project Board all that they need to
89
Session 4-4: Process Model Walkthrough
authorize progression to the next stage – and product delivery being the responsibility of
so the cycle will re-start for the following stage. Team Managers and team members.
If things are not going according to plan, This brings us to the end of this short session
following an exception report the Project Board where we walked through a PRINCE2 project.
may issue the ‘Exception plan request’ trigger,
and Managing a stage boundary will be
invoked to produce an exception plan along,
potentially, with an end stage report, and the
updated project initiation documentation.
This may lead to the project continuing based

on a modified plan, the exception plan – or to
the Project Board deciding to bring the project
to a premature close if that is the best option.
S4-4P5: Process Model Walkthrough – 4

Tony:
On a more positive note – as the work in the
final stage nears completion a trigger called
’Project end approaching’ is issued from the
‘Controlling a stage’ process and the ‘Closing a
project’ process begins.
The products are handed to the business and

the operational and maintenance support team.
The benefits management approach is checked
to make sure it contains sufficient detail to
enable the benefits to be measured and
realized post-project. Lessons will be
examined, and a lessons report will be included
in the end project report. Any outstanding work,
risks and issues will be recorded as follow-on
action recommendations and summarized in
the end project report.
The project initiation documentation with the

updated business case and project plan, the
end project report and the updated benefits
management approach will be sent to the
Project Board along with a ‘Project closure
request’.
The Project Board will confirm that the project

can be closed and approve and issue the
report to interested parties, finally issuing a
‘Closure notice’.
Throughout the life of the project, the Project

Board will provide ongoing direction. This
activity enables the Project Board and the
Project Manager to communicate both formally
and informally throughout the project as
queries arise, and advice is required. This
activity starts at the end of starting up a project
and continues until the project is completed.
Notice how the process model reflects the

PRINCE2 organization structure with directing
being the preserve of the Project Board,
Controlling a stage being the main area of
activity for the Project Manager and Managing
90
Session 5: Foundation Exam Simulator
Session 5: Foundation Exam

Simulator
S5P1: Exam Introduction – 1

Tony:
Welcome to the exam simulator.
The exam consists of multiple-choice questions

which are randomly selected from our
database. The pass mark is shown on screen.
The examination is timed and the exam
duration is shown at the top right of the
interface.
Once you begin the exam you will be presented

with a page that looks like this.
You will notice that the bottom portion of the

page contains a question reference matrix.
You can choose to answer the questions in

numerical sequence by clicking the forward and
back buttons, or you can select a question by
clicking its number in the matrix.
You can come back to any question you've

previously answered in the same way.
Questions which have been answered are
highlighted in blue.
S5P2: Exam Introduction – 2

Tony:
Once you are happy with your answers, you
can submit them for marking by clicking the
submit button - shown here.
At this point you will be given your score.

Valuable feedback on which of your answers
were correct or incorrect is also provided. Again
you can review your answers by selecting them
in the question reference matrix. Green
question numbers indicate a correct answer
and those in red were marked incorrect.
At the end of the quiz you will be given an

assessment of your performance.
Having completed the exam you can review

your given answers. You also have the
opportunity to add any question to your
Revision Pad, which stores questions for
review at a later date. The stored questions can
be accessed from the Revision Pad icon in the
course’s main menu.
If at any point you exit the quiz before

completion, you will have to restart from the
beginning.
Good Luck.
S5P3: Exam Simulator
91
Session 6: Case Study
Session 6: Case Study processing system which is used by Mike

Mayhew’s department.
S6P1: Case Study – 1 Finally, Dave Maxwell is the Manager of the

Tony: Manufacturing and Logistics Department and
In this case study, we will be walking through a manages a small team of people whose job it is
project from beginning to end, looking at the to ensure that the right products get to the right
way in which PRINCE2 was applied, the people at the right time.
management organisation that was established
and the various documents that were produced
during the project’s lifecycle. We will also S6P3: Case Study – 3
demonstrate the way in which PRINCE2 can be Tony:
tailored to suit a project of any size. The Helen has built the business based on
PRINCE2 manual gives considerable guidance producing downloadable software products but
tailoring the method. recently had the opportunity to purchase a
small hardware supplies company managed by
The project took place in a company called Ace
a former colleague.
Computing Limited and involved rebranding the
company’s marketing material following the The legal process is now complete and as
acquisition of another company selling customers can now purchase both software
computer hardware. Prior to the acquisition, and hardware, Helen would like the Ace
Ace Computing’s core business related to Computing brand to change to reflect this new
software products only. opportunity. So Helen has decided to setup a
project to develop a new corporate brand. This
Ace Computing is a small privately owned
will include developing a new logo and
company, which markets a range of
updating the company’s website to incorporate
downloadable software packages. The
the new products and all the company’s
company management structure looks like this:
documentation.
Helen Bell is the founder and Managing
The project mandate for this project came in
Director of the Company. Helen is from a
the form of a short paper, which Helen tabled
technical background and is the inspirational
for discussion at a Board Meeting.
force behind the company’s range of products.
She is also a very competent marketing person At that same Board Meeting Helen asked
and contributes much to the company’s sales Karen to assume the role of Project Executive
and marketing strategies. and Tim volunteered the services of Janice
Kitson to act as Project Manager. Janice was a
new starter in Tim’s department. She was an
S6P2: Case Study – 2 experienced PRINCE2 Practitioner and had
Tony: managed similar projects in her previous
Helen employs a small team of managers to company.
develop and run the business. Mike Mayhew is
The following day Karen and Janice met to
Director of Sales and Marketing. Beneath Mike,
design and appoint the rest of the project
there is a small territory based field sales force,
management team.
a telesales team and the marketing group who
handle all the company’s promotional activities. A copy of Helen’s project mandate can be
viewed by clicking here.
Karen Rogers is the Finance Director, heading
up a team of three people who keep control of
all the company’s finances including raising
invoices, processing credit card payments and S6P4: Case Study – 4
receiving payments via cheques and Tony:
automated payment systems. As Mike Mayhew’s department has
responsibility for sales he was asked to act as
Tim Goodman is the Technical Director, with Senior User.
two main areas of responsibility. One is Product
Development, where a team of analysts and Since most of the resources to be used on the
programmers produce the software packages project would come from his department, Tim
that the company sells. The other is the internal Goodman was invited to fulfil the Senior
IT function which provides computing services Supplier role.
to all other departments, including a
sophisticated telemarketing and order Mike is particularly busy planning the
integration of staff from the hardware company
92
and has decided to delegate his project Before Janice formally presented the project
assurance responsibilities. Sid Hall works for brief to the Project Board, it was reviewed by
Mike as Product Quality Assurance Manager Sid Hall, who suggested a few small
and Sid’s background in quality and standards corrections. While Sid was reviewing the
made him an ideal candidate to fill the project project brief, Janice produced a stage plan for
assurance role, Karen and Tim have decided to the initiation stage.
get more involved in the day-to-day elements of
the project and have decided to undertake their As this was a relatively small project, this
own project assurance. consisted of a short paper outlining when the
main activities would be undertaken and the
As the project is relatively small, Karen has delivery dates of each product. Again, due to
decided that she will make decisions on any the relatively small size of the project, it was
changes that will extend the project by more decided not to use a Gantt chart, a list of dates
than one week or cost more than 10% of the being adequate for this stage.
total budget.
The project brief can be viewed by clicking
The Project Board has also delegated change here.
authority to Janice for changes lasting less than
one week or costing less than £1,000 up to a
combined total of 10% of the project budget.
S6P6: Case Study – 6
Janice and the Project Board have decided that Tony:
issues should be handled informally unless At the first meeting of the Project Board the
they cause a deviation from stage or project project brief was tabled and, following some
tolerance. discussion, and final sanction from Helen, the
Project Board gave their authority to initiate the
Also, the nature of the work that went on within project. The minutes of the meeting served as
the development department meant that a the ‘Project initiation authorized’ trigger to
project support function already existed and Helen.
this was provided by Emily Barker whose main
function was maintaining the configuration And so, the Initiating a project process began.
management and filing systems for all of the Janice was lucky because the company had
development projects. used PRINCE2 before and had the basis of the
management approaches already prepared. As
It was decided that the project did not warrant an IT company, Ace Computing already had a
the appointment of Team Managers, the small defined corporate change management
number of specialists who would be involved strategy in place.
would report directly to Janice.
This was used on the project as the basis of its
own ‘change management approach’, which is
part of the project initiation documentation, or
S6P5: Case Study – 5 PID for short, showing current, interim and
Tony: target states, along with associated transition
Having agreed the team, Karen and the Project activities to get us from the old, to the new way
Board considered previous marketing projects of doing things in ACE Computing.
to see if there were any relevant lessons and
Janice contributed some valuable lessons The ‘risk management approach’ just required
based on her experiences in previous projects. the scales to be set for the analysis and the risk
A lessons log, which is part of the project log, tolerance had to be checked with Karen and
was opened and these lessons were Helen. A formal risk budget wasn’t required on
documented. this project.
Janice worked with the rest of the team to The ‘issue management approach’ was also
assemble the project brief. The project defined for the project, outlining the how issues
definition was straightforward, as Karen had will be raised, reported and resolved. This was
covered this element in the project mandate. derived from an existing ACE computing
Karen also prepared the outline business case. corporate change control policy.
The project product description was produced The ‘communications management approach’
with the help of Karen and Helen and it was was prepared and reflected the desire to
agreed that the project approach would be to provide a more informal approach to
complete all the development in-house and it communication and control.
wasn’t necessary to define this in any more
detail. The ‘quality management approach’ again
referred to Ace’s quality standards and the
93
quality register, which is part of the project log, A copy of the project initiation documentation
was established. can be viewed by clicking here.
The ‘commercial management approach’ was

also defined at this point, which was fairly
simple given the approach to the project was to S6P8: Case Study – 8
develop the new company logo, documentation Tony:
and website in-house. As there was only one delivery stage in this
project, Janice included the stage plan into the
The ‘sustainability management approach’ was project plan and sent this to the Project Board
outlined for the project to advise how it would with the rest of the project initiation
align with Ace Computing’s stated documentation for them to review and hopefully
environmental, social and governance goals, or approve.
ESG for short, which in turn, are reflected in the
organization’s corporate objectives. As Janice had been liaising closely with the
Project Board members during this short
The project’s ‘digital and data management initiation period, no difficulties were identified
approach’ was also defined, stating how with the project initiation documentation and
information will be managed across the they gave Janice the go ahead to start the
rebranding project’s ecosystem, this was project. The minutes of the meeting recorded
informed by ACE Computing’s corporate the ‘Project authorization notice’ and the ‘Stage
information management policy. authorized’ triggers.
Finally, the ‘benefits management approach’ So now the real work began…
was also created at this point, showing when
the benefits from this rebranding project would The main products were the requirements
be baselined and measured. document, website specification, website
design, completed website, logo and
documentation.
S6P7: Case Study – 7 Janice liaised with Mike Mayhew and his team
Tony: to generate a requirements document.
Having established the basis of the
management approaches in the PID, Janice Sid reviewed this document along with Eddie
got the team together to plan the project. The and Liz, two of the senior managers in the
result of the planning workshop was a simple marketing department.
product breakdown structure in the form of an
Once it had been approved the work of
indented list of products which enable the main
specification and design began.
product descriptions to be written. These
covered the new website, company logo and Janice took on the specification herself, whilst
new document templates. Glyn started on the new logo design.
It was decided that a work breakdown structure The documentation, graphics and artwork were
was not required given the small scale of the assigned to Adam who worked in Tim’s
project and the use of in-house specialists. production team and the job of writing the code
to make the whole thing work was given to
And, as the work was going to take less than a
Greg Fitzpatrick.
month in total, it was agreed that a single stage
would be used and the controls would be Because Janice worked very closely with both
largely informal. All reporting would be done Adam and Greg, it was decided that checkpoint
verbally. Written reports would only be reports were not necessary. However, Janice
generated when an issue report or exception did produce highlight reports which were
report was raised. circulated to the Project Board members on a
weekly basis.
Janice finalised the business case with the help
of Karen and Mike and the documentation was During the second week of the stage, an issue
assembled into the project initiation was raised by Greg Fitzpatrick, which caused
documentation. In this case, this amounted to a Janice some concern.
single sheet of links to areas of the ACE
computing corporate file sharing system, Greg had been expecting to have a routine
located on the main server, which documented operation and his appointment had come
the location and filenames of the constituent through earlier than expected. This would result
parts. This allowed the team to review each in a three week absence. As this delay caused
element separately and made it easy to keep a forecast deviation from the time tolerance,
the elements updated when necessary. Janice raised an issue report and after
94
considering the options, raised an exception Tailoring PRINCE2 had been a great success
report for the Project Board. Janice and the rebranding exercise completed with the
recommended that Glyn was taken off some minimum of documentation whilst retaining an
routine software development, to work on the excellent level of control.
rebranding project. This meant rescheduling
some activities, so that Glyn could bring his The minutes of the meeting noted the ‘Closure
other work to an orderly close. The Board notice’.
asked Janice to produce a new project (and
As the Senior User, Mike Mayhew was then
stage plan) to reflect the changes and this was
tasked with realising the benefits in line with the
reviewed and approved at the ‘Authorize a
benefits management approach.
stage or exception plan’ decision point.
We will leave you with a view of the some of
Glyn joined the project four days later and the
the key documents produced during the
work continued on target. A total of three
project. By clicking on the appropriate icon, you
highlight reports were produced during the
can open up and review any of the documents
stage and these, together with the exception
that we have previously examined.
report, can be viewed by clicking here.
S6P9: Case Study – Documentation

Tony:
During the stage, three key products were
assessed as part of the Rebranding project’s
‘quality control activities’ - the website
specification, documentation and artwork, and
logo. The new website was tested by a group
of users including Sid, Eddie and Liz. This was
carried out at each step in the development
cycle in accordance with the plan and the
quality register, which is part of the project log,
was maintained with the results. The completed
products were baselined by Emily.
Mike and Helen approved the final products
Once the products were completed Janice

asked the Project Board to confirm the release
date which was set for the end of the month in
two weeks’ time. In the interim period, Janice
prepared the end of project documentation.
Janice used the Closing a project process and

asked Emily for a report on the status of
products derived from the product register so
that she could check all the products had been
completed. Janice also discussed with the rest
of the IT team whether the operational
environment was ready to support the new
website.
As everything was in place, Janice started work

on the end project report and updated the
benefits management approach with the dates
when the benefits could be checked.
The due date for implementation came, the

website went live and worked perfectly and the
following day, Janice finalised the end project
report and held her final meeting with the
Project Board. Helen attended this meeting and
congratulated all those involved for running the
project in such an efficient manner.
95

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PRINCE2® 7

User Guide v1.0

© ILX Group plc 2023

Session 1: Course Overview student examination – namely Foundation level

S1P1: Objectives A “pass” at the Foundation level is a pre-

You are not allowed to take the eBook, physical • Culture, or

The PRINCE2 book lists many important

people involved in the project to ensure the D. Techniques.

S1P8: What makes a Project a PRINCE2 S1P11: Activity

S1P9: Activity This introductory session was intended to help

• State the five integrated elements that

Session 2-1: Projects, Principles, • Temporary, because they have a

S2-1P2: A PRINCE2 Project internal factors such as internal policies, and

In PRINCE2, the term ‘customer’ is used only

These include linear-sequential approaches, Others though may regard sustainability in

S2-1P10: Activity • Ensure continued business

Pete, please tell us about the first three, and

A project should not be started without a

The PRINCE2 method is flexible enough to be S2-1P14: Learn from Experience

At the end of a stage the Project Manager will

• The project product, which describes

PRINCE2 uses product descriptions to clearly S2-1P21: Activity

Drag each statement onto the appropriate

Therefore, if the application of PRINCE2 is to • Ensure continued business

• S5 - The stakeholders know exactly • Progress which answers the questions

Conversely, factors internal to an organization, S2-1P26: Activity

Project factors would include areas such as the A. Outcome

Tailoring arrangements for a specific project will

You should now be able to:

• Identify the PRINCE2 definition of a

This concludes this session.

Session 2-2: People by the change, and involved in the temporary

Indeed, if we think back to the ‘project context’

Tony: S2-2P4: Project and Organizational Culture

for me at least, automatically leads into S2-2P5: Change Management – 1

find being referred to as the End Goal, or End Tony:

S2-2P10: Leading Successful Teams

Manager being ‘locked in an ivory-tower’ working has been decommissioned

Diversity of opinion, and differing perspectives,

S2-2P14: How People Integrates with the S2-2P16: Activity

Finally, with regard to the ‘processes’ integrated Tony:

or differ from, the culture on the

This concludes this session.

Session 2-3: Processes and • Directing a project (DP)

We have compiled a crossword puzzle for you

You can print or download the crossword by

S2-3P5: Quiz Intro

The quiz consists of a number of multiple-

The following questions are on based on the

There are 20 questions in total.

The quiz is timed and the pass mark is shown

Once you begin the quiz, you will be presented

You will notice that the bottom portion of the

You can choose to answer the questions in

You can come back to any question you've

Once you are happy with your answers, you

At this point you will be given your score along

S3-1P1: Introduction S3-1P3: Business Case – 2

We also need to recognise that the chosen