Prince2 Lesson 02

Copyright 2014, Simplilearn, All rights reserved.

PRINCE2 is a registered trademark of AXELOS Limited.

Lesson 2—PRINCE2® Principles

PRINCE2® Foundation

● List the seven principles of PRINCE2® methodology ● Explain the seven principles of PRINCE2® methodology

After completing this lesson, you will be able to:

The seven principles of PRINCE2® are as follows:

Seven Principles of PRINCE2®

Continued Business Justification

A PRINCE2® project has continued business justification.[1]

Requirements for a PRINCE2® project are as follows:

● There should be a justifiable reason to start a project.

● The justification should remain valid throughout the life of the project. ● Although the justification should remain valid, it may change or evolve. ● The justification should be approved and documented in a Business Case.

Learn from Experience

PRINCE2® project teams learn from previous experience: lessons are sought, recorded and acted upon throughout the life of the project.[2]

The main features of this principle are:

● The teams learn from historical data based on previous similar projects in the same organisation or

from a different organisation, however in the same industry.

● They learn when the project starts, as it progresses and when it closes.

● It is the responsibility of everyone involved with the project to proactively seek lessons learnt.

A Japanese bank is to provide partial funding for an infrastructure project in a

developing country. However, they want an assurance from the local government as a similar project in the past had faced local labour problems.

Roles and Responsibilities

A PRINCE2® project has defined and agreed roles and responsibilities within an organization structure that engages the business, user and supplier stakeholder interests.[3]

Manage by Stages

A PRINCE2® project is planned, monitored and controlled on a stage-by-stage basis.[4]

The different features of this principle are:

● PRINCE2® suggests that the work be divided in multiple logical stages called management stages. ● The production of the project is carried out in phases called technical stages.

● A PRINCE2® project should have minimum two management stages: one initiation stage and one

or more further management stages.

● Shorter the stages, more the control and vice-versa.

● Stages are to be planned, delegated, monitored and controlled according to the business priority,

Manage by Exception

A PRINCE2® project has defined tolerances for each project objective to establish limits of delegated authority.[5]

Every PRINCE2® project has four levels of management. They are:

The Corporate or Programme Management appoints an Executive, whose responsibility is to get the project executed as per the tolerances defined by them.

Corporate or programme management

Project Board is responsible for providing overall direction and management to the project. Directing—Project Board

The Project Board appoints Project Manager to take care of day-to-day management of the project within the constraint set by the Project Board.

Managing—Project Manager

The Project Manager gets the work done through Team Managers, who deliver the actual specialist product of the project.

Delivering—Team Manager

Manage by Exception (contd.)

According to PRINCE2®, the Project Manager controls six aspects of the project and they are Time, Cost, Scope, Benefits, Risks and Quality.

● If the tolerances are forecast to be exceeded, they are immediately referred to the next

management layer for a decision.

Focus on Products

A PRINCE2® project focuses on the definition and delivery of products, in particular their quality requirements.[6]

The product description includes each product’s purpose, composition, derivation, format, quality criteria and quality method.

● Product description is used to: o estimate efforts.

o determine resource requirements.

o determine dependencies.

o determine schedule of activities.

● A successful project is output-oriented and not activity-oriented. An output-oriented project is

one that agrees and defines the project’s products prior to undertaking the activities required to produce them.

Tailor to Suit the Project Environment

PRINCE2® is tailored to suit the project’s environment, size, complexity, importance, capability and risk.[7]

Project Initiation Documentation (PID) describes how the method is being tailored for a project.

● Tailor the project management method to suit the project environment such as business processes

for human resource, finance and procurement management.

● Set project controls based on: o _Scale

o Complexity

o Importance

o Capability

a. b. c. d.

QUIZ

Tailor to suit the project environment Focus on products

Manage by exception Manage by stages

1

a. b. c. d.

QUIZ

Explanation: Manage by exception principle supports the definition of tolerances for the six

project objectives.

Tailor to suit the project environment Focus on products

Manage by exception Manage by stages

Which of the PRINCE2® principles supports the definition of tolerances for the six project objectives?

a. b. c. d.

QUIZ

Project is not seen as an end in itself

Provides clarity of what a project will deliver, why, by whom, and when Efficient and economic use of management time

Promotes consistency of project work

2

a. b. c. d.

QUIZ

Explanation: The implementation of management by exception provides efficient and

economic use of senior management time.

Project is not seen as an end in itself

Provides clarity of what a project will deliver, why, by whom, and when Efficient and economic use of management time

Promotes consistency of project work

If the projects are based on the management by exception principle, which of the following benefits does it provide?

a. b. c. d.

QUIZ

Defined roles and responsibilities Manage by stages

Manage by exceptions

Continued business justification

3

a. b. c. d.

QUIZ

Explanation: The incorporation of the primary stakeholders in the project management

team supports defined roles and responsibilities principle. Defined roles and responsibilities

Manage by stages Manage by exceptions

Continued business justification

The incorporation of the primary stakeholders in the project management team supports which principle?

a. b. c. d.

QUIZ

Defined roles and responsibilities Manage by stages

Manage by exceptions

Continued business justification

4

a. b. c. d.

QUIZ

Explanation: Manage by stages principle supports planning only to a level of detail that is

manageable and foreseeable. A PRINCE2® project is planned, monitored and controlled on a stage-by-stage basis.

Defined roles and responsibilities Manage by stages

Manage by exceptions

Continued business justification

Which PRINCE2® principle supports planning only to a level of detail that is manageable and foreseeable?

a. b. c. d.

QUIZ

As per PRINCE2®, the three primary stakeholders in the project are:

Business, users and customers Users, suppliers and customers Customers, business and trader Business, users and suppliers

5

a. b. c. d.

QUIZ

Explanation: As per PRINCE2®, the three primary stakeholders in the project are business,

users and suppliers.

Business, users and customers Users, suppliers and customers Customers, business and trader Business, users and suppliers

As per PRINCE2®, the three primary stakeholders in the project are:

5

a. b. c. d.

QUIZ

Which PRINCE2® principle ensures that the project is viable, achievable and desirable?

Manage by exception Focus on products

Tailor to suit the project environment Continued business justification

6

a. b. c. d.

QUIZ

Explanation: Continued business justification principle ensures that the project is viable,

achievable and desirable. A PRINCE2® project has continued business justification, which should remain valid throughout the life of the project.

Manage by exception Focus on products

Tailor to suit the project environment Continued business justification

Which PRINCE2® principle ensures that the project is viable, achievable and desirable?

6

a. b. c. d.

QUIZ

Manage by exception Focus on products

Tailor to suit the project environment Continued business justification

7

a. b. c. d.

QUIZ

Explanation: Focus on products principle ensures that the PRINCE2® project delivers the

product as per quality requirements. Without it, projects are exposed to major risks such as acceptance disputes, uncontrolled change (scope creep) and user dissatisfaction.

Manage by exception Focus on products

Tailor to suit the project environment Continued business justification

Which PRINCE2® principle ensures that the PRINCE2® project delivers the product as per quality requirements?

a. b. c. d.

QUIZ

Manage by exception Focus on products

Tailor to suit the project environment Continued business justification

8

a. b. c. d.

QUIZ

Explanation: Tailor to suit the project environment principle ensures that project

management effort and approach are appropriate for the needs of the project. PRINCE2® is tailored to suit the project’s environment, size, complexity, importance, capability and risk.

Manage by exception Focus on products

Tailor to suit the project environment Continued business justification

Which of the following PRINCE2® principles ensures that project management effort and approach are appropriate for the needs of the project?

a. b. c. d.

QUIZ

Justification for a PRINCE2® project is documented in:

Business Case Project Brief Stage Plan

Project Initiation Documentation (PID)

9

a. b. c. d.

QUIZ

Explanation: A PRINCE2® project has continued business justification. The justification is

documented in a Business Case. Business Case Project Brief Stage Plan

Project Initiation Documentation (PID)

a. b. c. d.

QUIZ

A PRINCE2® project should have at least how many management stages?

Three Four Seven Two

10

a. b. c. d.

QUIZ

Explanation: PRINCE2® requires a minimum of two management stages: one initiation stage

and one or more further management stages. Three

Four Seven Two

A PRINCE2® project should have at least how many management stages?

10

● A PRINCE2® project has continued business justification

● PRINCE2® project teams learn from previous experience: lessons are sought,

recorded and acted upon throughout the life of the project

● A PRINCE2® project has defined and agreed upon roles and responsibilities

within an organisation structure that engages the business, user and supplier stakeholder interests

● A PRINCE2® project is planned, monitored and controlled on a

stage-by-stage basis

● A PRINCE2® project has defined tolerances for each project objective to

establish limits of delegated authority

● A PRINCE2® project focuses on the definition and delivery of products, in

particular, their quality requirements

● PRINCE2® is tailored to suit the project’s environment, size, complexity,

Summary

Here is a quick recap of what we have learnt in this lesson:

Thank You

Copyright 2014, Simplilearn, All rights reserved.

[1] Based on Managing Successful Projects with PRINCE2®, by AXELOS. Principles, Continued Business Justification.

[2] Based on Managing Successful Projects with PRINCE2®, by AXELOS. Principles, Learn from Experience.

[3] Based on Managing Successful Projects with PRINCE2®, by AXELOS. Principles, Defined Roles and Responsibilities.

[4] Based on Managing Successful Projects with PRINCE2®, by AXELOS. Principles, Manage by Stages. [5] Based on Managing Successful Projects with PRINCE2®, by AXELOS. Principles, Manage by

Exception.

[6] Based on Managing Successful Projects with PRINCE2®, by AXELOS. Principles, Focus on Products. [7] Based on Managing Successful Projects with PRINCE2®, by AXELOS. Principles, Tailor to Suit the Project Environment.