11 Project Management Concepts/Terms everyone can Learn from.

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Originally published on my LinkedIn.

Whether we know it or not, we all manage projects in one way or the other in our daily and professional lives — from planning an event to organizing a marketing campaign or developing a new website, projects are all around us.

Project management is simply the application of knowledge, tools and skills to achieve our project objective or requirements. As such, knowledge is an essential part of effective project management, and some key project management concepts are quite useful for everyone — from C-level and senior management to team leaders and the team members.

I outlined 11 interesting concepts from the Project Management Body of Knowledge (PMBOK) that everyone, in any industry or job role can benefit from. Have a look and tell me what you think:

1. Life-cycle costing: This concept is one we’re already familiar with in some way and it means considering the cost that a resource will incur even after the initial purchase is made. For example, if you have the choice between purchasing a car which costs $5,000 but requires minimal maintenance vs a $3,000 car which will potentially cost you an additional $3000 in repairs and maintenance, in this the $3,000 car is more ‘expensive’. Life-cycle costing should be used in making decisions rather than the initial cost of an item.
2. Agile: An agile environment is the opposite of a predictive (aka waterfall) environment. A predictive environment is one where the work to be done (scope) is planned in detail and there are minimal scope changes during project execution. Basically everything should follow the plan as much as possible. In an agile environment, the scope is not clearly defined and work is done in short cycles (called ‘sprints’) after which the deliverable is shipped and the next cycle is based on feedback from the first. This is a more flexible and dynamic project environment — mostly suited for IT projects.
3. Float/Slack: This is the degree to which delaying or postponing an activity will delay the next dependent activity or the finish date of the entire project. So if I say “Activity A has zero float” this means if activity A is delayed for any reason, the entire project will be delayed. In other words, activity A is critical or on the critical path. If activity B has 5 days slack, it means we could either start activity B as soon as it’s possible to do so or we could start it 5 days later and our project would still be on schedule.
4. Scope creep: I think this is a good concept to be aware of because it happens a lot to the best of us. Have you ever started a project and, because the work to be done or the requirements are not well defined you end up doing some extra work that eventually complicates the original plan? That is exactly what scope creep means. Even though a number of projects might not require a tightly managed scope, it’s important to always have a rough idea of what is inside and outside of your scope so that you can prioritize the results you set out to achieve in the first place.
5. Stakeholder analysis: Also another important concept to know. Personally, I find that this applies to many things in daily life as well. In project management, a stakeholder is anybody who could impact or be impacted by your project either positively or negatively. By identifying and analyzing stakeholders before starting a project, we discover their needs and requirements early enough and plan them into our project to avoid any problems later on. The general way of thinking about stakeholders is considering people directly involved in a project or program, but this isn’t ideal. Imagine if you were to be constructing a busy and noisy music theater in a small, residential neighborhood, the people who live next to the proposed theater should be considered as stakeholders and you should try to include their needs into the planning and design of your project.
6. Baseline: In project management there are 3 important performance measurement baselines; these are the baselines for cost, schedule and scope which are part of the project plan. We use these baselines to monitor the project’s progress and check that it’s all going according to plan. In a more general sense, baselines could be any original estimation which we can always refer to (monitor) and check if we are running on track.
7. Burn rate: The burn rate of a project refers to how fast you’re spending your budget. It’s one of the Cost control tools used to track spending and compare with the cost baseline. For start-ups, burn rate is also an important tool to track how fast the Venture Capital funding is being spent.
8. Cost of quality: Cost of quality is an interesting concept. By definition, it’s the cost which is spent in ensuring that requirements are met for a project or it’s deliverables. This cost is usually of 2 types: conformance and non-conformance costs. An example of conformance costs might be money spent implementing process quality audits or buying higher quality materials that meet the requirements. Non-conformance costs could be warranty costs as a result of sub-par deliverables for example, or fines we might be required to pay if we fail to meet quality standards etc. A Rule of thumb for choosing the right set of quality processes is that conformance costs shouldn’t be higher than the non-conformance costs.
9. Value Engineering: Simply put, this is a systematic approach to developing a quality product at the same or lower costs. In this case, value is a ratio of function and cost and we try to maximize the value (while staying within scope of course!).
10. Team building: Hopefully, this is something we’ve all heard occasionally from the Human Resource managers at work. Team building is very important and employers who are serious about employee performance should definitely be including team building activities into their organisations. These are activities which strengthen team bonds and collaboration. In project management, team building is part of the Develop Team process in Resource Management. Because of how important it is, the PMBOK recommends this process start right from when a project is initiated up to the end of the project life-cycle.
11. Milestones: Milestones are events which are represented in the project schedule to show major achievements. If you’re working on any type of project that spans a considerable amount of time, you should definitely include and track milestones in your timeline. Not only do they help to boost team motivation, they are also a great way for high-level communication as they help you summarize what you’ve done so far in your project and what’s coming next, without going into too much detail.

Were any of these concepts or terms helpful to you? Kindly let me know what you think or if there are other PMBOK concepts I missed that you think are also broadly useful. I’ll be looking forward to hearing from you! :)