Project Planning Process Group – Part 6

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About this lesson

The project management planning processes integrate with each other to create all components of the project plan.  There are 24 project management planning processes. Part 6.

Quick reference

Project Planning Process Group – Part 6

The project management planning processes integrate with each other to create all components of the project plan.  There are 24 project management planning processes.

When to use

Once a project has been initiated it needs to be planned.  Projects that are very large or that are ill-defined at the time of initiation will often go through a significant replan at the beginning of each phase of the project life cycle.  Of course whenever a project change is approved, the team must execute the appropriate planning processes to address the change.  

Instructions 

Planning Process Group

“Those processes required to establish the scope of the project, refine the objectives, and define the course of action required to attain the objectives that the project was undertaken to achieve.” PMBOK® Guide

Project Management Institute, A Guide to the Project Management Body of Knowledge, (PMBOK® Guide) – Sixth Edition, Project Management Institute, Inc., 2017  Part 2, Figure 2-1, Page 562 and Glossary definition, Page 713. 

Every project needs to be planned.  Due to the unique nature of the project goal, objective or results, projects are full of uncertainty.  The particular set of deliverables, resources, timing and business environmental factors associated with each process requires a unique project plan.  All ten project management knowledge areas contribute to the development of the overall project management plan through the knowledge management plan.

There are 24 processes in the Planning group of project management processes.  Four of those processes are addressed in this course module and the other twenty are addressed in other modules.  The four in this module are: Identify Risks, Perform Qualitative Risk Analysis, Perform Quantitative Risk Analysis, and Plan Risk Responses.

Identify Risks (11.2)

“The process of identifying individual project risks as well as sources of overall project risk, and documenting their characteristics.” PMBOK® Guide

Planning Process Group                                       Risk Mgmt Knowledge Area

This is an iterative process that must be continuously practiced since new risks can arise at any time during the project.  The importance of this process should be obvious.  If you don’t identify a risk, you won’t proactively prepare for it.  But not identifying it does not reduce the likelihood that it will happen; in fact not identifying it may even increase the likelihood.  The project document created in this process is used to track and manage the project risk management activities.  It therefore becomes an input to many other processes and next to the project management plan is the most widely used project management document. 

Inputs:

  • Project Management Plan
  • Agreements
  • Project Documents
  • Procurement Documents
  • Enterprise Environmental Factors
  • Organizational Process Assets

Tools and Techniques:

  • Expert Judgement
  • Data Gathering
  • Data Analysis
  • Prompt Lists
  • Meetings
  • Interpersonal and Team Skills

Outputs:

  • Risk Register
  • Risk Reports
  • Project Document Updates

Project Management Institute, A Guide to the Project Management Body of Knowledge, (PMBOK® Guide) – Sixth Edition, Project Management Institute, Inc., 2017, Figure 11-7, Page 410 and Glossary definition, Page 708.

Perform Qualitative Risk Analysis (11.3)

“The process of prioritizing individual project risks for further analysis or action by assessing their probability of occurrence and impact as well as other characteristics.” PMBOK® Guide

Planning Process Group                                       Risk Mgmt Knowledge Area

Risks are not equal in terms of the threat or opportunity that they bring to a project.  This process assesses the risks and prioritizes them.  It normally relies on a qualitative assessment of probability and impact in order to stratify the risks into various degrees of high and low categories.  In later processes, actions will be taken with regard to the high risks.

Inputs:

  • Project Management Plan
  • Project Documents
  • Enterprise Environmental Factors
  • Organizational Process Assets

Tools and Techniques:

  • Data Gathering
  • Data Analysis
  • Data Representation
  • Meetings
  • Interpersonal and Team Skills
  • Risk Categorization
  • Expert Judgment

Outputs: 

  • Project Documents Updates

Project Management Institute, A Guide to the Project Management Body of Knowledge, (PMBOK® Guide) – Sixth Edition, Project Management Institute, Inc., 2017, Figure 11-9, Page 420 and Glossary definition, Page 712.

Perform Quantitative Risk Analysis (11.4)

“The process of numerically analyzing the combined effect of identified individual project risks and other sources of uncertainty on overall project objectives.” PMBOK® Guide

Planning Process Group                                       Risk Mgmt Knowledge Area

This process is a numerical analysis of selected risks, normally the risks that were identified as high risks in the qualitative analysis.  There are numerous quantitative techniques, some taking very little time and resources, others requiring extensive time and resources.  The project manager must decide which risks will be analyzed quantitatively and how much effort to spend on that analysis.

Inputs:

  • Project Management Plan
  • Project Documents
  • Enterprise Environmental Factors
  • Organizational Process Assets

Tools and Techniques:

  • Data Gathering
  • Data Analysis
  • Representations of Uncertainty
  • Interpersonal and Team Skills
  • Expert Judgment

Outputs: 

  • Project Documents Updates

Project Management Institute, A Guide to the Project Management Body of Knowledge, (PMBOK® Guide) – Sixth Edition, Project Management Institute, Inc., 2017, Figure 11-12, Page 429 and Glossary definition, Page 713.

Plan Risk Response (11.5)

“The process of developing options, selecting strategies, and agreeing on actions to address overall project risk exposure, as well as to treat individual project risks.” PMBOK® Guide

Planning Process Group                                       Risk Mgmt Knowledge Area

Risks are uncertain events that may happen in a project.  They include both threats to the project success and opportunities to improve project performance.  This process of planning risk responses occurs when the project plan is being developed in order to reduce a threat or increase an opportunity.  The action selected may impact the threat probability, the threat impact, or both.  Risk analysis that does not lead to appropriate risk response is wasted effort.

Inputs:

  • Project Management Plan
  • Project Documents
  • Enterprise Environmental Factors
  • Organizational Process Assets

Tools and Techniques:

  • Strategies for Threats
  • Strategies for Opportunities
  • Contingent Response Strategies
  • Strategies for Overall Project Risk
  • Expert Judgment
  • Meetings
  • Interpersonal and Team Skills
  • Data Gathering
  • Data Analysis

Outputs: 

  • Change Requests
  • Project Management Plan Updates
  • Project Documents Updates

Project Management Institute, A Guide to the Project Management Body of Knowledge, (PMBOK® Guide) – Sixth Edition, Project Management Institute, Inc., 2017, Figure 11-17, Page 438 and Glossary definition, Page 713. PMBOK is a registered mark of the Project Management Institute, Inc.
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  • 00:04 Hi, this is Ray Sheen.
  • 00:06 This is part 6 of 6 lessons on the project planning process area.
  • 00:11 This lesson will focus on the risk planning processes.
  • 00:15 Now, we've already discussed the plan risk management process.
  • 00:18 Which created the risk management plan or the methodology we'll use to look at risk.
  • 00:23 Now we wanna focus in on specific risks and
  • 00:25 how we address them in the project management planning.
  • 00:31 We'll start with the process identify risks.
  • 00:33 The project management body of knowledge, the PMBOK Guide,
  • 00:37 defines this as the process of identifying individual project risks as well as
  • 00:42 sources of overall project risk and documenting their characteristics.
  • 00:47 The inputs for this process are the project management plan and
  • 00:50 several outpust from procurement management planning processes.
  • 00:54 In particular, the procurement documents from plan procurement management,
  • 00:58 which included items like your bid strategy and make buy plan and
  • 01:02 the agreements you reach when you conduct procurements.
  • 01:05 Also many of the other project documents from all of the other planning and
  • 01:09 the monitoring and controlling processes can be used to identify risks.
  • 01:13 Of course, enterprise environmental factors and
  • 01:15 organizational process assets also apply.
  • 01:19 The outputs are all on the project documents arena.
  • 01:21 First there is the risk register.
  • 01:23 This is used by the other project risk management processes, since this document
  • 01:27 will act as a record of all risk management analysis and action.
  • 01:31 Then there's the risk report.
  • 01:33 This is a status of the risk management actions.
  • 01:36 And of course it's quite possible that while identifying risks,
  • 01:39 you find that you need to update some of your other project documents.
  • 01:43 Many of the tools and techniques for this process are familiar, but
  • 01:46 we do have a least one new one.
  • 01:48 The familiar ones are expert judgment, meetings, data gathering, data analysis,
  • 01:52 and interpersonal and team skills.
  • 01:55 The new one is the prompt list, which are the list of risk categories used
  • 01:59 to remind you of possible risks when trying to identify them.
  • 02:03 The next process is to perform qualitative risk analysis.
  • 02:07 The project management body acknowledge, the PMBOK Guide,
  • 02:10 defines this as the process of prioritizing individual project risks for
  • 02:14 future analysis or action by assessing their probability of occurrence and
  • 02:19 impact as well as other characteristics.
  • 02:21 This process determines which risk are significant enough on a project to require
  • 02:26 action and which risks the project manager can safely ignore.
  • 02:30 The inputs for this will be the project management plan and the project documents,
  • 02:34 such as the risk register, which is where all the risks are listed.
  • 02:37 And of course, enterprise environmental factors and
  • 02:39 the organizational process assets.
  • 02:42 The outputs for this process are updates to project documents.
  • 02:45 In particular, a document that would be updated is a risk register.
  • 02:48 But other documents used for planning and
  • 02:51 controlling the project may need to be updated also.
  • 02:53 Once again, most of the tools and techniques are familiar to us.
  • 02:56 Such as expert judgment, data gathering, data analysis, data representation,
  • 03:01 meetings, and interpersonal and team skills.
  • 03:04 The one new technique is risk categorization,
  • 03:07 which can take on many types of categories.
  • 03:09 Such as urgency, which WBS elements are affected, or the sources of risk.
  • 03:14 The next process is to perform quantitative risk analysis.
  • 03:18 The project management body of knowledge, the PMBOK Guide, defines this as
  • 03:23 the process of numerically analyzing the combined effect of identified individual
  • 03:28 project risks and other sources of uncertainty on overall project objectives.
  • 03:33 Where the previous process was prioritizing risks,
  • 03:37 this process is calculating a risk value for that risk and the project.
  • 03:42 The inputs are the same as with qualitative risk analysis.
  • 03:45 That is, the project management plan, project documents, like the risk register,
  • 03:49 and the enterprise environmental factors and organizational process assets.
  • 03:53 The output of this will again be updates to the project documents,
  • 03:56 such as the risk register based upon the results of this analysis.
  • 04:00 And the tools and techniques are expert judgement, data gathering,
  • 04:04 data analysis, and interpersonal and team skills.
  • 04:07 Along with one new one, representations of uncertainty.
  • 04:11 That means modelling the levels of uncertainty
  • 04:14 with some type of a probability distribution.
  • 04:17 The final process in this area is plan risk responses.
  • 04:21 The project management body of knowledge, the PMBOK Guide,
  • 04:24 defines this as the process of developing options, selecting strategies, and
  • 04:29 agreeing on actions to to address overall project risk exposure,
  • 04:33 as well as to treat individual project risks.
  • 04:36 Two points to make here.
  • 04:38 First, it's not enough just to analyse risks.
  • 04:40 We must decide what to do about it,
  • 04:42 otherwise our risk analysis is just whining and complaining.
  • 04:46 Second, you will see that we're both enhancing opportunities and
  • 04:49 reducing threats.
  • 04:50 There are positive and negative risks in this project and
  • 04:54 both will need to be addressed.
  • 04:56 The inputs on this process are the project management plan, project documents, and
  • 05:00 the enterprise environmental factors, and organizational process assets.
  • 05:04 The outputs of this will first and foremost be change requests
  • 05:08 to be processed by our integrated change control process.
  • 05:12 And then there are changes to the project management plan.
  • 05:15 And of course changes to project documents like the risk register.
  • 05:18 The tools and techniques are the strategies for
  • 05:21 negative risks, the strategies for positive risks, and
  • 05:25 contingent response strategies, and the strategies for overall project risk.
  • 05:30 These will be briefly addressed in our lesson on the project risk management
  • 05:33 knowledge area.
  • 05:34 If you're not familiar with these,
  • 05:36 I suggest some in-depth study with them in the PMBOK Guide.
  • 05:40 We also have some familiar tools and techniques.
  • 05:42 Expert judgment, data analysis, data gathering,
  • 05:45 decision making, and interpersonal and team skills.
  • 05:50 Well, this concludes the 24 project management planning processes.
  • 05:53 Now fortunately, there were some similarities in the inputs, outputs,
  • 05:57 and tools and techniques that'll help us remember these.
  • 06:00 Keep in mind that this represents 25% of the exam.
  • 06:02 So there will be approximately two questions on each process.

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PMI, PMP, CAPM and PMBOK are registered marks of the Project Management Institute, Inc.

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