1) The Chief Executive Officer (CEO) of the record company requires the cost-benefit analysis of every project to be recorded in a document called a 'project rationale'. The executive is preparing the draft 'project rationale' as part of the pre-project phase. Which principle is being applied, and why?

1.1.1a
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A. Correct. For all projects, PRINCE2 requires a justifiable reason for starting the project, which must be recorded. The format and formality of documentation may vary, depending on organizational standards, needs and circumstances. Ref 3.1 B. Incorrect. The principle being applied is 'continued business justification'. It is true that the executive may draft the outline business case, however this does not explain why 'continued business justification' is being applied in this situation. Ref 3.1, 14.4.4 C. Incorrect. The principle being applied is not 'learn from experience'. In the situation given, there is no description of a lesson having been learnt from the current project or outside. Ref 3.1, 3.2 D. Incorrect. The project should be aligned with the commissioning organization’s strategy, and the project management team members are expected to follow the guidelines set by their corporate management. However, the 'learn from experience' principle is not being applied in this situation as there is no description of a lesson having been learnt from the current project, or outside. Ref 3.1

2) During the initiation stage, the Vice President stated that attendance at launch events held on Monday evenings is low, and on previous projects this had resulted in lower album sales. As a result, the launch event for this album will be held later in the week. Which principle is being applied, and why?

1.1.1b
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A. Incorrect. The situation describes learning from the experience of a similar launch event, and is not related to the 'continued business justification' principle. The 'continued business justification' principle aims to ensure that the project remains aligned to the benefits being sought that contribute to the business objectives. Ref 3.2, 3.1 B. Incorrect. The situation describes learning from the experience of a similar launch event, and is not related to the 'continued business justification' principle. The 'continued business justification' principle aims to ensure that the project remains aligned to the benefits being sought that contribute to the business objectives. Ref 3.2, 3.1 C. Correct. When starting a project, previous or similar projects should be reviewed to see if lessons can be applied. It is the responsibility of everyone involved with the project to look for lessons rather than wait for someone else to provide them. The project manager should communicate with the events coordinator to find out more about the timing of the previous event. Ref 3.2 D. Incorrect. The project is in the initiation stage and so this is learning from experience at the start of a project, not learning as the project progresses. As the project moves into the management stages after initiation the project should continue to learn. Lessons should be included in relevant reports and reviews. The goal is to seek opportunities to implement improvements during the life of the project. Ref 3.2

Towards the end of stage 2, the project manager realized that not all of the ‘recorded sample songs' would be completed before the end of the stage. The project manager decided to move the remaining work to stage 3. This enabled the project manager to report that stage 2 was completed within time tolerance. Is this an appropriate application of the 'manage by stages' principle, and why?

1.1.1d
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A. Incorrect. Application of the 'manage by stages' principle provides review and decision points for the project board at defined intervals. The project manager cannot decide to move work from stage 2 to stage 3, as this is outside the project manager's delegated authority. This is also against the principle of 'manage by exception', as exceeding time tolerance for the stage must be reported. Ref 3.4, 3.5 B. Incorrect. Application of the ‘manage by stages’ principle provides review and decision points for the project board at defined intervals, rather than letting the project run on in an uncontrolled way. The project board authorizes one stage of the project at a time against a stage plan. Although the project manager has discretion to make adjustments, this would not include amending a stage baseline, such as moving work from one stage to another. Ref 3.4 C. Correct. Application of the ‘manage by stages’ principle provides review and decision points for the project board at defined intervals, rather than letting the project run on in an uncontrolled way. This is why the planned work that remains in stage 2 cannot be moved to stage 3, without the approval of an exception. Ref 3.4 D. Incorrect. Application of the ‘manage by stages’ principle provides review and decision points for the project board at defined intervals. The project board authorizes one stage of the project at a time against a stage plan. Although the project manager has discretion to make adjustments, this would not include amending a stage baseline, such as moving work from one stage to another. Delivery steps often overlap but stages cannot. Ref 3.4, 9.3.1.1

4) The executive has appointed the company's finance manager to provide business assurance, to monitor whether the album sales will exceed the production costs as the project progresses through each stage. How well does this apply the 'manage by exception' principle, and why?

1.1.1e
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A. Incorrect. PRINCE2 breaks the project down into discrete, sequential sections, called management stages, as part of the ‘manage by stages’ principle. However, this does not explain why the project assurance role is required as part of the ‘manage by exception’ principle. Ref 3.4 B. Correct. As part of the ‘manage by exception’ principle, an assurance mechanism should be put in place so that each management layer can be confident that controls are effective. Ref 3.5 C. Incorrect. As part of the ‘tailor to suit the project’ principle, roles may be combined or split, provided that accountability is maintained and there are no conflicts of interest, however this is not mandatory. Ref 4.3.1 D. Incorrect. As part of the ‘focus on products’ principle, PRINCE2 requires projects to be output-oriented rather than work-oriented. However, this does not explain why the project assurance role is required as part of the ‘manage by exception’ principle. Ref 3.6

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