5th Edition PMBOK® Guide—Chapter 13: Process 13.1 Identify Stakeholders

1.  Introduction

The first out of four stakeholder management-related project management processes is in the Initiating Process group, and is the process which identifies the stakeholders on the project even before the detailed planning stage of the project.  It not only identifies the stakeholders, but analyzes the relationships with them and what their level of engagement or interest in the project is and what their level of influence on the project is.  Both of these factors together determine what strategy to use when engaging them throughout the course of the project.

2.  Identifying Stakeholders

stakeholder is an individual, group or organization which may affect or be affected by the outcome of a project.   One way to identify stakeholders is consider three categories of stakeholders.    The first category of stakeholders to be considered are those within the project, i.e., the project team. The second category of stakeholders are those outside of the project, but within the organization. This group includes the sponsor, functional managers, and organizational groups. Then there is the third category that are outside of the organization. This group includes business partners, sellers or suppliers, customers or users, government regulators and possibly other entities as well.

So stakeholders may not necessarily be involved in the project, but their interests may be affected by the project either positively or negatively. It is important to take the negative stakeholders into account on a project. A local environmental group could be considered a negative stakeholder for a new refinery project for example, because they could protest against the project. A government regulatory authority might also be a negative stakeholder if the new project is found not to conform to governmental regulations.

Now there is a diagram of all the stakeholders in the 5th edition PMBOK® Guide page 31. The diagram was complete in that it listed all of the categories of stakeholders; however, it was a bit confusing because it lumped together all of the stakeholders that were external to the project itself, whether they were within the company or outside of it.

I think my way of dividing the stakeholders into three groups, internal to the project, internal to the organization, and external to the organization, is perhaps a bit better in helping understand how the various stakeholders can affect a project.

3.  Stakeholder Groups–expanded view

For an expanded view of these three groups, take a look at the following diagram representing categories of stakeholders on a project. The center circle in purple represents those stakeholders internal to the project that are actually working on the project itself. Those three circles outside of that in various shades of blue represent those stakeholders outside of the project, but within the organization; these include the sponsor, the program/portfolio managers, the functional managers and the managers of ongoing operations at an organization. The third category comprises the outer two circles in different shades of green which represent those stakeholders that are outside the organization: sellers, business partners, customers/users, and then regulatory agencies. There is a detailed explanation of each circle of stakeholders below the diagram.

Fig. 1. Categories of Stakeholders on a Project

  1. The innermost circle is that of the people actually working on the project, namely the Project Manager, the Project Management Team (the other members of the team that assist with the management of the project), and the Project Team members who actually do the work.
  2. The second circle is that of the Sponsor, the person or group that provides the financial resources for the project and the one who champions the project within the organization when it is first conceived. The Sponsor acts as a spokesperson to higher levels of management within the organization, which is why I placed the Sponsor in the second circle.
  3. The third circle contains those higher-level organizers of projects, such as the program manager, who manages related projects in a coordinated way, and a portfolio manager, who manages a collection of projects or programs which may not be related in content, but which all serve the business model of the organization at large. I put them in this circle because they monitor the performance of the project and can even terminate it if the business case for the project no longer holds.
  4. The next circle is still within the organization, but rather than the three inner circles that deal with project work, this circle represents the interests of the ongoing operational work, with the functional managers in charge of areas such as human resources, finance, accounting, and procurement. Depending on the type of organization, project managers will have to negotiate with them to allow their staff with expertise that would assist the project to work on that project for its duration. The operations management people will have to be consulted during the course of the project, because the project when completed is often handed off to them on account of the fact that they take care of normal operations and will provide long term support for the result of the project.
  5. Now we get to the circle which is outside of the organization, but one in which there is a business relationship between the organization and that stakeholder, such as business partners that may have a financial interest in the project, sellers/suppliers in the case of a B2B relationship, customers/users in the case of a B2C relationship
  6. The last circle consists of elements of society that may not have any formal relationship to the organization, but which may contain groups that are affected by the project or that can influence the project. The PMBOK® Guide labels this group generically as “Other Stakeholders”, but I have put an example of “Regulatory Agencies” as just one type of entity that could be considered a stakeholder. A non-governmental organization such as an environmental awareness group that is an NGO would also be an example of a stakeholder at this level.

These concentric circles, I believe, show a little more of the different kinds of stakeholders and why some of them have more influence than others. I found this diagram helpful for our group to gain awareness of the different types of stakeholders, and I hope that it is helpful for those studying for the PMP exam as well.

4.  Inputs of 13.1 Identify Stakeholders

The inputs come from the project charter, which can identify some of the parties related to the project, as well as procurement documents, since suppliers are one category of stakeholders.    EEFs can draw upon experience in the industry at large, and OPAs can draw upon the company’s own past experience on previous projects.

1. Project Charter Provides information on internal and external parties related with the project and affected by the result.
2. Procurement Documents If the project is itself a procurement for another organization, then the buyer is a stakeholder.  If the project requires procurements from other organizations to be completed, then the supplier or seller is a stakeholder.
3. EEFs
  • Organizational culture (what management positions are stakeholders?)
  • Government and industry associations (identifies promulgators or regulations or industry guidelines as stakeholders)
  • Global, regional, local trends (guides identification of stakeholders)
4. OPAs
  • Stakeholder register templates
  • Stakeholder register from previous, similar projects
  • Lessons learned from previous projects
1. Stakeholder Analysis Determines interests and influence of stakeholders on the project.  Identifies stakeholder relationships that may be influenced.
2. Expert Judgment Complete identification of stakeholders can be assisted by the following experts:

  • Upper management
  • Other organizational units (in functional organization)
  • Other project managers or PMO (in projectized or matrix organization)
  • Subject Matter Experts (SMEs) in business or project area
  • Industry groups or consultants
  • Professional and technical associations
  • Regulatory bodies, non-governmental organizations (NGOs)
3. Meetings Profile analysis meetings are used to develop understanding of major project stakeholders.
1. Stakeholder Register Contains details concerning stakeholders, including:

  • Identification information
  • Assessment information
  • Stakeholder classification (internal/external, etc.)

5.   Tools & Techniques of 13.1 Identify Stakeholders

Once the main categories of stakeholders are identified by the inputs (from project charter and stakeholder documents, in addition to stakeholder registers from previous, similar projects), the complete list of stakeholders can be rounded out by means of expert judgement from various sources internal to the organization (e.g., upper management) and external to the organization (e.g., industry associations, consultants, or SMEs in the project application area).

Once a complete list of stakeholder is obtained, the main tool of stakeholder analysis is used to figure out how much power or influence each stakeholder has on the outcome of the project, and also their interest in the outcome of the project.   In general terms, each stakeholder will have relatively high or low power, and high or low interest in the project.    The intersection of these two factors yields the matrix below.

Those stakeholders with low power, and low interest are put on a watch list, to see if they change during the course of the project.   Those with low interest, but high power are kept informed; those with high interest, and low power are kept satisfied; those with high power AND high interest are managed or engaged closely throughout the project.

This matrix has some visual affinity with the risk matrix, with certain events having low or high impact, and low or high probability.    There is also some conceptual affinity, because in a way a stakeholder can also impact a project in the same way that an event can, both in potentially positive AND negative ways.   The first level of stakeholder analysis then is to give a broad qualitative analysis of the stakeholder’s power and interest so that the broad strategy of engagement can be determined.

6.   Outputs of 13.1 Identify Stakeholders

The identification of stakeholders goes into the Stakeholder Register, which then includes the classification of the stakeholder (see paragraph 3 above with the concentric categories of stakeholders described), and then the assessment of the stakeholder which is the results of the stakeholder analysis done in the project.    Analogous to the way that the risk register is elaborated in subsequent risk management processes, the stakeholder register is elaborated in subsequent stakeholder management processes.

The next post goes into the first detailed planning process involving stakeholder management, process 13.2 Plan Stakeholder Management which has, as its objective, the production of the Stakeholder Management Plan.   

5th Edition PMBOK® Guide—Chapter 13: Project Stakeholder Management Knowledge Area

1.  Introduction

Stakeholders can, literally, make or break a project, either by their support for a project or by their interference in a project.  The cost of making a change based on a request by a stakeholder goes up throughout the project, so it is important to prevent changes by engaging the stakeholders as early as possible.  That is why Identify Stakeholders is the only other process to be in the Initiating Process Group other than Create Project Charter, meaning that is undertaken even before the formal planning process starts.

Because PMI is placing increasing emphasis on Stakeholder Management, it has elevated it from being just a part of Communications Management to its own knowledge area outright.  This is because communicating with a stakeholder is not enough; you have to influence the stakeholder.  I say “influence” because you will not be in a position with some stakeholders to be a position of authority to coerce them, and have to rely on other forms of “soft power” or influence to be able to get them to do what you want them to do.

2.  Stakeholder Management Processes

There are four project management processes in the Procurement Management Knowledge Area.  One is in Initiating Process Group, process 13.1 Identify Stakeholders.  It is the only process other than 4.1 Create Project Charter to be in that group, which shows its importance and urgency when conducting a project, if it needs to be done even BEFORE planning the project formally starts.

The second one is the Planning Process Group, 13.2 Plan Stakeholder Management, which sets up the Stakeholder Management Plan, the guideline for all of the other stakeholder processes.  The third one is in the Executing Process Group, 13.3 Manage Stakeholder Engagement, which takes place throughout the project, and if any adjustments to that engagement are needed in the course of the project, 13.4 Control Stakeholder Management comes into play.

Here is a chart outlining the contents of the four processes devoted to Stakeholder Management:





Process Description
Initiating 13.1 Identify Stakeholders Identifies people, groups, or organizations that could impact or be impacted by a decision, activity, or outcome of the project.  Analyzes and documents their interests in and influence on the project.
Planning 13.2 Plan Stakeholder Management Develops appropriate management strategies to effectively engage stakeholders throughout the project.
Executing 13.3 Manage Stakeholder Engagement Communicates and works with stakeholders to meet their needs/expectations, address issues as they occur, and support stakeholder engagement.
Monitoring & Controlling 13.4 Control Stakeholder Engagement Monitors overall project stakeholder relationships, adjusts strategies and plans for engaging stakeholders.

The next post will discuss the inputs, tools & techniques, and outputs of the first process, 13.1 Identify Stakeholders.

5th Edition PMBOK® Guide—Chapter 12: Process 12.4 Close Procurements

1.  Introduction

There are four procurement-related project management processes, one in each of the following process groups:  planning, executing, monitoring & controlling, and closing.  The fourth process is therefore in the Closing Group, and is the process which manages the formal closing of the procurement as per the contract between the buyer and seller.

This post is devoted to the Inputs, Tools & Techniques, and the Outputs of this third of the four procurement processes, 12.4 Close Procurements.

2.  Inputs

The Procurement Management Plan contains the guidelines for closing out procurements. The procurement documents contain project and financial information that should tell whether the requirements set forth in the procurement contract have been followed.

12.4  Close Procurements
1. Project Management Plan In particular, the Procurement Management Plan, one of the subsidiary plans of the overall Project Management Plan, provides details and guidelines for closing out procurements.
2. Procurement Documents The following types of project information is collected, indexed, and filed

  • Contract schedule
  • Scope
  • Quality
  • Cost performance
  • Inspection records

Along with the following financial information

  • Contract charge documentation
  • Payment records
1. Procurement Audits Structured review of procurement process.
2. Procurement Negotiations If there are any outstanding issues, claims, and disputes, the goal is to settle these primarily through negotiation.  Failing that, they can be settled through alternative dispute resolution (ADR) methods including arbitration and mediation.  Litigation is absolutely the last resort if negotiation and/or ADR methods fail.
3. Records Management System Used to manage contract and procurement documentation and records.
1. Closed Procurements Buyer provides seller with formal written notice that the contract has been completed, based on completion of the requirements set forth in the Procurement Management Plan.
2. OPAs Updates
  • Procurement file
  • Deliverable acceptance
  • Lessons learned documentation

2.  Tools & Techniques

Just like the Quality Assurance which review the processes of the project as a whole, there can be procurement audits for the review of just the procurement process.

If there are any outstanding issues at the end of the procurement process, the negotiation process is the first way of settling them, followed by alternative dispute resolution (ADR) methods such as arbitration and mediation involving third parties.  Only in the last resort do the buyer and seller resort to the courts (litigation) to settle the matter.

3.  Outputs

Once the requirements of the procurement contract have been recognized by the buyer to have been achieved by the seller, the buyer then sends formal written notice to the seller that the contract has been completed, and the OPAs are then updated for reference on future projects.

This process is the only other project management process besides Close Phase or Project that is in the Closing Process Group.

This concludes the review of the four processes of Chapter 12 Procurement Management.  The next chapter is the last chapter of the PMBOK® Guide, Chapter 13 Stakeholder Management, and the next post will give an overview of the processes belonging to that knowledge area.

Labor Day as seen through The Time Machine

This post is dedicated to the blogger Driftglass, the head of the Science Fiction University segment on the Professional Left Podcast, which has re-kindled my love of science fiction.    

There are a lot of people writing about the history of Labor Day, including this excellent column by Paul Krugman called Love for Labor Lost.   http://www.nytimes.com/2013/09/02/opinion/krugman-love-for-labor-lost.html?_r=0

The purpose of this post is to look at Labor Day through the lens of science fiction, in particular, the movie The Time Machine based on the science fiction novella written by H. G. Wells in 1895.    I saw the 1960 version of the movie directed by George Pal on Friday evening, just because it was a movie that I hadn’t seen for a long time and wanted to watch again for nostalgia’s sake.

However, yesterday I reflected on the fact that it was Labor Day weekend and thought back on the movie I had seen earlier that weekend.    In the movie, the book’s protagonist, a British inventor, invents a time machine and uses it to explore the future.    He visits the year 802,701 A.D. , where he meets the Eloi, a society of child-like adults that live an idyllic existence without apparently having to do any work.    This first positive appraisal of the society is followed by the realization on the part of the protagonist that these people also do not seem to have any curiosity or any ambition.    But where does their clothing come from?   Where does their food come from?    They seem too unambitious to have produced it themselves …

Despite these questions about how their society functions, he decides to leave them in disgust at the degenerate state of mankind, when he finds that his time travel machine is missing.    It had apparently been dragged inside of a building whose facade resembled that of a Sphinx.     In trying to recover his time machine, he encounters a race of ape-like troglodytes called Morlocks.   The building he found is the entrance to an underground lair where the Morlocks live.    There he finds the machinery which apparently manufactures the clothing and produces the food upon which the Eloi depend.    What do the Morlocks get in return for this service to the Eloi.    There, he finds that the Eloi ARE the food upon which the Morlocks depend.    They exist not as enemies but in a symbiotic relationship, where one group depends on the other for its existence.

They both are descendants of the human race, where the middle class has disappeared, and the capitalist system we have now has devolved in a feudal system where there is only an upper class, an elite, and the working class.    These groups have then evolved, or devolved I should say, to the point where the two classes have become, in fact, two different species.

In this science fiction story, H. G. Wells posits the question through the lens of science fiction, “what are the ultimate consequences to a society when its middle class starts to disappear?”   It is a question that some modern movies of science fiction are exploring, in the October 2012 movie Cloud Atlas, which looks at the question of the interplay between economic, social, and political inequality in six interlocked stories that take place in different time periods, and the recent release of the movie Elysium, about a future where the elite 1% live in luxury aboard a space station while the other 99% of humanity lives on a polluted, overcrowded Earth.

Another exploration of what might happen if the middle class disappears comes from the popularity of the fantasy series on HBO called Game of Thrones, based on the series of high-fantasy series of novels by George R. R. Martin.   It describes the intrigue between a series of kingdoms that are locked into a struggle for supremacy.    Fantasy novels usually portray some sort of variation on a feudal order of society and often include the harnessing of elemental forces by means of magic rather than by science.

In that wildly popular series, we may be looking not at a romanticized past, but at a possible future just as dystopic as the one portrayed in Elysium, where the middle class disappears and the only two classes left are the 1% elite, the equivalent of the medieval aristocracy, and the 99%, the equivalent of the medieval lower classes.    This is why Labor Day is important, because the modern middle class in the United States after World War II is the creation of many historical forces, one of which is the gains won by the labor movement in the first half of the 20th century.

Forgetting that past is dangerous, as Paul Krugman insists, and the reason why comes from an even stronger warning by the science-fiction visionaries of the past, such as H. G. Wells in The Time Machine, and those of today who continue in that tradition.

But will we listen?    That is truly an open-ended question …

Integral Theory and Project Management–Tenet #4

This series of posts take the Ken Wilber’s introduction to Integral Theory called A Brief History of Everything and discusses the 20 tenets concerning the concept of a holon and how they can be applied to the field of project management.   This post covers tenet #4.    I have been posting one tenet a week on Sundays in a event to cover the 20 tenets in some detail, at least as far as my understanding of them goes.

1.  Recap–definition of a holon

A holon is an entity which consists of components, and yet is itself a component of a larger whole. The reason for the introduction of the concept is that bridges the philosophical divide between those who think that reality is composed of isolated units (atomism) and those who think that it is composed of a large web of interconnected parts). The first two tenets are as follows:

2.  Recap of tenets #1-3

Tenet #1. Reality as a whole is not composed of things or processes, but of holons.

Holons must be considered from the standpoint of interacting with other holons on the same level, and with holons at higher levels (of which the holon is just a part) and lower levels (which comprise the parts of the holon).

Tenet #2 Holons display four fundamental capacities: The horizontal capacities of self-preservation, self-adaptation, and the vertical capacities of self-transcendence and self-dissolution.

Holons follow the dual rules of evolution when it comes to holons at the same level:    survival of the fittest (self-preservation) and survival of the fitting (self-adaptation).    Holons have the property of being able to evolve to the next highest level (self-transcendence), and they can also “devolve” into their component parts (self-dissolution).

Tenet #3 Holons emerge

As mentioned in Tenet #2, holons have the property of self-transcendence or evolution to the next highest level.    This is not just a higher degree of organization, but also involves emergent properties or differences in kind from the level below.

3.   Tenet #4

The fourth tenet is as follows:

Holons emerge holarchically.

Let’s unpack this statement.    Holons, as seen above, are units that are both wholes containing parts and parts of larger wholes.   This kind of concentric nesting of holons reminiscent of the Russian matroshka dolls is considered a holarchy.    In contrast, we see in an organizational chart the usual notion of a hierarchy where those people who work for a supervisor are listed in boxes below the supervisor.    Hierarchy is linear, not concentric like a holarchy.

One of the philosophical controversies about hierarchies is that many groups think of them as being authoritarian, with the person at the top adopting a sort of “”top-down” or, more colloquially, a “my way or the highway” approach to management.    One of the earlier critics of the authoritarian or “top-down” style of management was Douglas McGregor who in the 1960s at the MIT Sloan School of Management developed contrasting models of human motivation in the work place called Theory X and Theory Y.   Theory X was the “top-down” style of management, where a manager assumed that workers needed to be told what to do.  Theory Y was more of a “bottom-up” style of management, where a manager assumed that workers had the intelligence to be able to solve most of their problems themselves, and his role was more of a facilitator than a dictator.

In terms of Integral Theory, the difference between Theory X and Theory Y is that Theory X stands for a “dominator hierarchy” where one holon (the supervisor) totally controls the parts (the workers), which is a pathological or unhealthy form for an organization to take because it suppresses the creativity and initiative of its workers.    Theory Y, on the other hand, is a hierarchy in that there IS a supervisor of the workers.    However, the supervisor, rather than suppressing the growth of the parts (the workers), actually encourages that growth.    This, Ken Wilber, is actually a natural hierarchy or a holarchy.

Critics of the concept of a hierarchy in general come from the left side of the political spectrum, as they create a caricature of all hierarchies as being undesirable, as if they were all guilty of being authoritarian or fascist.    They propose instead what might be called in contrast to a hierachy a heterarchy, or linking among equal parts, rather than ranking among unequal levels.    In essence, this is a model with workers, but no supervisors.

As Ken Wilber likes to point out, this is a pathological form of organization as well, because while it does not suppress the creativity and initiative of the workers (the “parts” of an organization), it does suppress the natural leadership instincts of a worker who wants to become a leader.    Actual  real-life examples where organizations failed because of lack of leadership come from the communes on the left in the 1960s that collapsed because they consistently suppressed any notion of leadership as being oppressive.    The Occupy Wall Street movement similarly collapsed, among other reasons, because they consciously disavowed the very notion of their being leaders of their movement.

What Ken Wilber is saying is that in an organization, there are three states of holarchy, one healthy and two pathological:

  • natural hierarchy or holarchy (where the holon at one level interacts well with the parts at a lower level)
  • dominator hierarchy (where the holon at one level suppresses the parts at a lower level)
  • heterarchy (where the parts at a lower level suppress the emergence of a holon at a higher level)

In political terms, the heterarchy and dominator hierarchy are pathologies of the left and right wing, respectively.    The point as far as project management is concerned is that you want, as a project manager, to encourage the creativity and growth of your team members.    However, if there is a crisis, and they turn to you for a quick decision, they need for you to be able to be a leader and make that decision in an effective and efficient manner.

To use what now probably borders on being  a politically incorrect idiom, there of course can be “too many chiefs and not enough Indians,” but an organization can also suffer if there are only Indians, but not enough chiefs.    The real point is that an organization is never a static thing like the neat boxes of an organization chart would have you believe; it is a dynamic, evolving entity and the way to have it evolve the fastest is for a project manager to have more of the “bottom-up” style of management rather than the “top-down” style of  management, which even in the Mad Men days of the 1960s Douglas McGregor of MIT’s Sloan School of Management thought of as being a dinosaur doomed to extinction.    His job was to hasten that extinction, and herald the coming of a style that promotes evolution within an organization.

The next post will cover tenet #5 of the 20 tenets introduced by Ken Wilber in his book A Brief Theory of Everything.   If you want to read more about Integral Theory, that is the best book for beginners to start.

8 Essentials of Effective Speaking–a talk by David Brooks

At the Leadership Conference held by District 30 (Chicagoland) of Toastmasters International on August 31, 2013, David Brooks, the 1990 World Champion of Public Speaking, gave a talk on the Essentials of Effective Speaking.    Joining him on stage was Presiyan Vasilev, a sales professional from Chicago, Illinois, who won the 2013 World Championship of Public Speaking one week ago at the International Toastmasters Convention held in Cincinnati, Ohio, after several eliminating rounds that begins six months ago with 30,000 participants from 122 countries.   For more information on how to become a better public speaker, go to David Brooks website at  http://www.davidbrookstexas.com/.

1.   The audience is not the enemy

The reason why many people avoid public speaking is because they have a fear of it, which is partially fear of an unknown and possibly hostile audience.    Just remember that the audience is not the enemy.    Don’t try to get rid of your fear; harness it and consider it a constant companion which keeps you trying to do your best.   The audience will forgive an occasional mistake; most of them are secretly rooting for you to succeed from the start.    Just remember to locate some friendly faces out there, those people who seem to be nodding and in general getting enthusiastic about your message.   If you do happen to make a mistake, locate those friendly faces!    Just remember that because you see somewhat who seems not to be enthusiastic, it could be a combination of culture, personality, or occupation that does permit them to show it as openly as others.

2.  Determine what you want the audience to think, feel, or do

What is your objective in the speech?   This should be simple enough to apply the “business card test”:   can you write down the “message” of your speech on the back of a business card?   If so, it is simple enough to get across in the 5-7 minutes you are allotted.    If you can’t, then the audience most likely will not get the message, or at least not all of it.

3.  Write your speech word for word

The purpose is NOT so that you can memorize your speech.    The purpose is so that you can edit it.  Good speaking begins with good writing; good writing depends on good editing.    He gave the example of the Gettysburg address, which consists of 10 sentences that took a total of 2 minutes to deliver.    There is an apocryphal story about how it was cobbled together by Lincoln on the back of an envelope on his way to give the speech:   that is simply not true, because we have several drafts of his speech which prove otherwise.    What is interesting in reading the drafts is not what was included in the speech; it was how much was taken out.    Every word has a purpose.

4.   Bring life to your words with colorful images and examples

This is where style becomes apparent.    Choose those words which evoke the audience’s own imagination so that they start to experience what you are saying, rather than just hearing it.

5.  Six words that can change the way you speak:  Make A Point; Tell A Story

It was stated earlier in point #2 that you should have a point to your speech; rather than explain that point to your audience, you need to have them discover it through experiencing it as part of the story you tell.

6.  Six emotions that will connect with any audience:  happiness, sadness, anger, surprise, disgust, and fear

Choose words which not only create an image, but which evoke at least evoke one of the emotions listed above.    When people empathize with you, they are more willing to accept your message that you want to convey in your speech.

7.  Don’t underestimate the power of laughter

When we laugh, we relax.   When we relax, our minds are more receptive to learning.    Many people don’t think they can get people to laugh because they think they are not able to tell a joke.    A professional joke-teller is a comedian; you don’t have to be a comedian to make people laugh.   Just ask yourself what makes you laugh.    Take a notebook with you or a digital recorder and if you see something that makes you laugh, write it down and make a “humor file.”    In fact, this technique works with the six emotions listed above in point #6.   Then have this on hand so that you can insert these into a speech into a place where they will have the most impact.

8.  Don’t tell us, take us

Rather than describing the incident like a reporter, take us as an eyewitness to the event by acting it out with movements, gestures, vocal inflections that put us right there in the middle of the action!

These techniques were demonstrated by David Brooks and his guest, the new World Champion of Public Speaking, Presiyan Vasilev, by having them recount some stories based simply on experiences that had had within the past 24 hours.   After each of the half-dozen examples, they asked to go through the six emotions and the six attributes of the stories.   Presiyan said that besides the six emotions related by David Brooks, the six attributes of your story should be that it is:

  • Believable
  • Relatable
  • Original
  • Optimistic
  • Kind-Hearted
  • Simple

Of course, someone in the audience noted that the acronym for these six attributes is BROOKS, which having just witnessed the talk by David Brooks, should be easy to memorize.    Together, these two champions, one from 1990 and the newest one from 2013, demonstrated that effective speaking is a skill that ANYONE can learn to make their speeches more effective.

It was an inspiring talk on a personal level, and as the Vice President of Education of my Toastmasters Club, I intend to use David Brooks’ materials to start our club’s own Resources Library!

5th Edition PMBOK® Guide—Chapter 12: Process 12.3 Control Procurements

1.  Introduction

There are four procurement-related project management processes, one in each of the following process groups:  planning, executing, monitoring & controlling, and closing.  The third process is therefore in the Monitoring & Executing Process Group, and is the process which manages the procurement relationship (the monitoring part) and makes changes to the procurement contract if necessary (the controlling part).

This post is devoted to the Inputs, Tools & Techniques, and the Outputs of this third of the four procurement processes, 12.3 Control Procurements.

2.  Inputs

The inputs come from the Project Management Plan (output of process 12.1 Plan Procurement Management) and the awards of procurement contracts and the Agreements themselves (output of process 12.2 Control Procurements).

During the course of the procurement process, work performance data and reports are used to monitor the procurement.  If there are changes to the procurement, these are an output of the process, but any approved changes are implemented as an input to the process.

12.3  Control Procurements
1. Project Management Plan This gives the guidelines which describes how the procurement process will be managed.
2. Procurement Documents Includes the awards of procurement contracts and the procurement statement of work (SOW).
3. Agreements Describes terms and conditions that specify what the seller is to perform or provide to the buyer.
4. Approved Change Requests Any proposed changes to the procurement which are approve through the Integrated Change Control Process.
5. Work Performance Reports
  • Technical documentation—contains technical information on the deliverables
  • Work performance documentation—indicates progress on completion of deliverables
6. Work Performance Data
  • Extent to which quality standards are being satisfied
  • Costs that have been incurred or committed
  • Identification of paid seller invoices
1. Contract Change Control System Process by which the procurement can be modified.  This is part of the overall Integrated Change Control System for the project.
2. Procurement Performance Reviews Structured review of the seller’s progress to deliver the project scope and quality, within cost and on schedule.
3. Inspections and Audits Required by buyer and supported by seller to support the compliance of seller’s processes and deliverables.
4. Performance Reporting Work performance and data are compared against agreement requirements.
5. Payment Systems Accounts payable system of the buyer documents all payments in strict accordance with terms of contract.
6. Claims Administration Contested changes to the procurement are referred to as claims, disputes, or appeals, and are resolved by the parties involved or through the alternative dispute resolution (ADR).
7. Records Management System Manages contract and procurement documentation and records.
1. Work Performance Information Reports on compliance with contracts.  Provides basis for identification of current or potential problems to be resolved.
2. Change Requests Change requests are processed for review in Integrated Change Control Process.
3. Project Management Plan Updates
  • Procurement Management Plan
  • Schedule baseline
  • Cost baseline
4. Project Documents Updates Procurement documentation is updated:

  • Procurement contract
  • Approved change requests
  • Unapproved change requests
  • Financial records (invoices, payment records)
5. OPAs Updates
  • Correspondence
  • Payment schedules and requests
  • Seller performance evaluation documentation

2.  Tools & Techniques

The monitoring part of the process comes through procurement performance reporting, performance reviews, inspections and audits, the records management system and the accounts payable system.

If the controlling part of the process suggests changes be made in the procurement, then the change requests to the contract are handled as part of the overall Integrated Change Control System on the project.   The difference with the Contract Change Control System is that any disagreement between the parties involved becomes a claim (sometimes called a dispute or an appeal) that must be resolved between the parties in Claims Administration or through an independent Alternative Dispute Resolution (ADR) process.

3.  Outputs

As mentioned above, change requests may be an output of the process, which are fed into the Contract Change Control System and the overall Integrated Change Control System.  If they are approved, they are inputs to this process to be implemented.  If they are not approved, they go into the project documents updates.

Work performance information may be used to see if there are current or potential problems that need addressing through change requests or simply through changes in the seller’s own operations with regard to the procurement.

If change requests are required, the impact of the change on the scope, schedule, and budget of the project will result in changes to the respective plan in the Project Management Plan.

Various project documents are updated because of this process, and so are documents that the organization may refer to in future projects (OPAs updates).

The final process in the procurement knowledge area is 12.4 Close Procurements, and that is the subject of the next post.

5th Edition PMBOK® Guide—Chapter 12: Procurement Agreements (Contracts)

1.  Introduction

One of the outputs of process 12.2 Conduct Procurements is the procurement agreement, usually put in the form of a contract, which contains the terms and conditions under which the seller produces the procurement for the buyer.

The purpose of this post is to list the major elements of the procurement agreement.  Rather than listing them in a random, laundry-list fashion as appears in the PMBOK® guide itself, I plan to put them categories depending on the knowledge area they are related to.

2.  Elements of the Procurement Agreement

  Category Element of agreement
1. Integration Change request handling
2. Scope Statement of work of deliverables
3. Time Schedule baseline
4. Period of performance
5. Cost Pricing
6. Payment terms
7. Fees and retainer
8. Penalties
9. Incentives
10. Quality Inspection and acceptance criteria
11. Warranty
12. Limitation of liability
13. Human Resources Roles and responsibilities
14. Communications/


Performance reporting
15. Risk Insurance and performance bonds
16. Procurements Seller’s place of performance
17. Place of delivery
18. Product support
19. Subordinate subcontractor approvals
20. Termination clause, Alternative Dispute Resolution (ADR) mechanisms

Obviously, most of the elements deal with procurements, but many deal with the constraints within which the procurements must be delivered, in particular with regard to the scope, time and cost of the project.

Inspection and acceptance criteria are related to quality issues, but so are warranty and limitation of liability, as those are related to the cost of nonconformance that come under the costs of quality.

Insurance and performance bonds are considered part of risk management because they are a form of transferring the risk from the buyer to the seller.  This is the overall risk of the product and its effect on the project; the cost risk of producing the product is handled by the various penalties and incentives under the cost management category.

Reporting of performance is part of communications management, but the management of the suppliers as stakeholders in the overall project must be also be considered.  Finally, if the supplier needs to make a change in the scope of the product being produced, it must submit the change request to the buyer who will then consider it as part of the Integration Management process of Perform Integrated Change Control.

So it can be seen that not just the basic requirements of the product (the inspection and acceptance criteria, delivery deadline, and pricing), but also any effects of the product on the project as a whole must also be considered explicitly in the overall procurement agreement.

Once the procurement is set up, the next process is where the procurement process is monitored and controlled throughout the period of the project in which it is performed.  That process, 12.3 Control Procurements, is the subject of the next post.

5th Edition PMBOK® Guide—Chapter 12: Process 12.2 Conduct Procurements

1.  Introduction

There are four procurement-related project management processes, one in each of the following process groups:  planning, executing, monitoring & controlling, and closing.  The second process is therefore in the Executing Process Group, and is the process whereby the supplier of the procurement is selected.

This post is devoted to the Inputs, Tools & Techniques, and the Outputs of this second of the four procurement processes, 12.2 Conduct Procurements.

2.  Inputs

The basis for having a procurement at all is the Make-or-Buy Decision.  This is important to keep in the background of this process, because conditions within the organization, external market conditions, or those of the project itself (cost overruns, delivery delays, etc.) may change to the point that the scales are tipped away from “buy” back to “make”.

Most of the inputs of this Conduct Procurements process come from the previous process 12.1 Plan Procurement Management, the output of which is the Procurement Management Plan.  This is the blueprint containing the guidelines for all the other procurement processes.

The Procurement Documents contain the Procurement Statement of Work, the “seed” of the procurement scope, which is the portion of the scope of the entire project out of which is carved the portion of the scope that is going to be provided by the procurement.  These Procurement Documents can include the Request for Proposal which goes out to the sellers, in response to which they produce the Seller Proposals.  These Seller Proposals are then judged according to the Source Selection Criteria, not to mention the past experience with sellers contains in the Operational Process Assets (OPAs).

12.2  Conduct Procurements
1. Procurement Management Plan This describes how the procurement processes will be managed, from developing procurement documentation to closing of the procurement contract.
2. Procurement Documents These include documents such as the Request for Proposal used to solicit proposals from prospective sellers.
3. Source Selection Criteria Information may include information on:

  • Technical capabilities, capacity
  • Delivery dates
  • Product cost estimates
  • Life-cycle costs (purchase cost and support cost)
4. Seller Proposals These are the sellers responses to the Procurement Documents (input #2).
5. Project Documents Includes risk-related contract decisions in risk register.
6. Make-or-Buy Decisions Evaluation of the need for the organization to buy products versus make the items themselves.
7.; Procurement Statement of Work Describes the scope of the product to be delivered by the supplier, and contains clearly stated set of goals, requirements, outcomes for the supplier to meet.
8. OPAs
  • Listing of pre-qualified sellers
  • Past experience with sellers
  • Prior procurement agreements
1. Bidder Conference Meetings between buyer and all prospective sellers prior to submittal of a bid or proposal.
2. Proposal Evaluation Techniques Formal evaluation review process is defined by buyer’s procurement policies.
3. Independent Estimates Independent estimate, either prepared by the buyer or by an outside estimator, may serve as a benchmark for proposed responses.
4. Expert Judgment Used to evaluate seller proposals.  May be a multi-discipline review team with expertise in each of the areas covered by the procurement documents and proposed procurement contract.
5. Advertising Lists of potential sellers may be expanded by advertisements in publications such as newspapers or trade publications, or online solicitations to the vendor community.
6. Analytical Techniques Helps identify the readiness of prospective vendors to provide the product without cost overruns, and to identify risks to be monitored during procurement process.
7. Procurement Negotiations Clarifies requirements and other details of the purchases so that mutual agreement can be reached prior to signing the contract.
1. Selected Sellers Those sellers who have

  • been judged to be in a competitive range based on the evaluation of their bid or proposal, and
  • have negotiated a draft contract.
2. Agreements Includes terms and conditions that specify what the seller is to perform or provide to the buyer.
3. Resource Calendars Quantity, availability, and timing of when resources are either active or idle.
4. Change Requests Any proposed changes to the procurement are treated like any other change to the project, through the Integrated Change Control Process.
5. Project Management Plan Updates
  • Cost baseline (budget)
  • Scope baseline (= product scope statement, WBS, WBS dictionary)
  • Schedule baseline
  • Communications Management Plan
  • Procurement Management Plan
6. Project Documents Updates
  • Requirements Documentation
  • Requirements Traceability Matrix
  • Risk Register
  • Stakeholder Register

3.  Tools & Techniques

The Bidder Conferences are there to clarify the requirements of the product that the buyer

is requesting, and to make sure that the prospective sellers understand them before submitting their proposals.  The sellers may be solicited through a list of pre-qualified sellers that is enlarged through various forms of Advertising.  Once they submit their proposals, the buyer may judge them using Expert Judgment, Independent Estimates, or more formal Proposal Evaluation Techniques such as a formal evaluation review process.  Analytical Techniques may analyze the cost risk and other risks of the procurements.  Further Procurement Negotiations with the sellers may clarify the requirements to the point that a draft contract may be negotiated.

4.  Outputs

The sellers that qualify are the Selected Sellers, and from those a final Seller is selected with whom there is a final Agreement that is put into the procurement contract.  Resource calendars are updated to make sure that the resources provided by the seller are accounted for in terms of their quantity, availability, and timing in terms of the larger project they will be used on.

The procurement will occasion changes in the project baselines (scope, time, and cost), and the communications management plan will be updated to reflect the coordination required between the seller and buyer.  Project Documents like the stakeholder register and risk register will be updated to reflect the inclusion of the seller in the stakeholders to be managed and the risks of the procurement to be included in the risk register of the project as a whole.

If there are any changes that the seller proposes to the scope of the procurement, they are treated like any other change request through the Integrated Change Control Process.

The main output of course of this process is the Agreement between the seller and buyer in the form of a Procurement Contract.  This will be the basis for the executing, monitoring & controlling, and finally closing of the procurement.  The next post covers the elements that are typically included in a procurement contract or agreement.

5th Edition PMBOK® Guide—Chapter 12: Source (Supplier) Selection Criteria

1.  Introduction

As part of the process 12.1 Plan Procurement Management, one of the outputs of the process that go into Procurement Documents like a Request for Information (RFI) or Request for Proposal (RFP) is the Source Selection Criteria.  Often times these criteria are made into a checklist that is used as a “scoring sheet” to rate seller proposals.

The 5th Edition of the PMBOK® Guide  lists the various criteria that are included as part of the Source (i.e., Supplier) Selection Criteria  However, they are listed in apparently random, laundry-list fashion, and this post was designed to put some order into the list by arranging them by category.

2.  Source Selection Criteria

These are the questions that should be asked by the organization requesting proposals from suppliers in order to rate or score those proposals.   These questions make up the source selection criteria.

  Category Criterion Explanation
1. Integration Management approach Does seller have, or can it develop, management processes and procedures to ensure a successful project?
2. Scope Understanding of need Does proposal address the Procurement Statement of Work (SOW)?
3. Time Deadline With what degree of confidence can the seller produce the product within the specified deadline?
4. Cost Overall or life-cycle cost What is the total cost of the procurement (purchase cost plus operating cost)?
5.. Financial capacity Does seller have necessary financial resources?
6. IP Rights Does seller assert intellectual property rights in the product they produce for the project?
7. Proprietary Rights Does seller assert proprietary rights in the product they produce for the project?
8. Quality Technical approach Can seller’s technical methodologies, techniques and solutions meet the technical requirements in the procurement documents?
9. Warranty What will seller covered by warranty, and for what time period?
10. Production capacity Does seller have sufficient production capacity to meet potential future requirements?
11. Human Resources Technical capability Does seller have technical knowledge and skills needed?
12. Risk Risk response How much risk is being assigned of transferred to the seller?  How does the seller mitigate risk?
13. EEFs Business type and size Does seller’s enterprise meet a specific category of business (disadvantaged, etc.) defined by the organization or established as condition by government agency?
14. OPAs Past performance What is past performance of selected sellers?
15. References Can seller provide references from prior customers verifying compliance with contractual requirements?

One of the few knowledge areas represented in the list of categories that PMI did not include in the above list was that of the Time Management knowledge area, and so I added a crucial criterion for the selection of a seller that PMI left out, perhaps because it’s so obvious:  the ability of the seller to meet any deadline specified by the organization.

This is a list of possible criteria that might be used in the case of a complex project.  Of course, in the case of a simple project, where the product needed from the seller is readily available off the shelf from various sellers, the only criterion needed might be the cost.

These criteria are prepared in order to give an objective basis for choosing the seller in the next process, 12.2 Conduct Procurements.  An outline of the inputs, tools & techniques, and outputs of that process is the subject of the next post.