PMI PgMP – The Program Management Supporting Processes Part 2

7. Program Quality Management

The quality has many definitions. The simplest is fitness to purposes. The program quality management includes the activities of the performing organization that determine program quality policies, objectives and responsibilities to reach the program successful closure. We will start here by elaborating the differences between the quality control and the quality assurance. The program quality control is the activity of monitoring particular component project or component sub program deliverables to ensure adherence to a defined set of quality criteria or quality requirements that lead to adequate benefits realization. Quality control is an inspection driven approach where the quality inspectors aim to prove the existence of quality and to keep mistakes out of the customer’s hands.

The program quality assurance is the activity to ensure that the program under development meets specified quality policies and standards. Quality assurance is a prevention driven approach where the work is to be performed correctly the first time, so the quality control is an inspection driven approach, while the quality assurance is a prevention driven approach. Please note that the quality management is described in details in the PM POC, but it is briefed in the Standards for Program Management Third Edition. Quality management should be considered when defining all program management activities as well as for every deliverable and service.

For instance, when creating the program procurement Plan, the quality manager or officer should be involved to ensure that the quality standards and controls are applied. The Quality Management Supporting Activities group spends over the program definition phase and the program benefits delivery phase. This chart records the measure activities and the outputs of the measure activities. Let us review it in more details. Starting with the program definition phase, we have one activity which is the program quality planning that produces the following outputs program Quality policy, which is the top management’s expression of its intentions, direction and aims regarding quality program quality standards like ISO 9000 standards program quality estimates of cost quality metrics, service level agreement or Memorandums of understanding.

Quality metrics which translate customer needs into acceptable performance measures like having up to three bugs with severity, one in software, program acceptance test, quality checklists and quality assurance and control specifications. Then, in the program benefits delivery phase, we have two activities the program quality assurance and the program quality control.

 The program quality assurance has the following outputs quality assurance audit findings, quality assurance standards reports, and quality assurance change requests, while the program quality control has the following outputs quality change requests, quality control completed checklists and inspection reports and the quality test reports or measurement results we reviewed before the program audit, the program review, and the program health check. Now we will review the program quality review, the program quality audit which are similar to what mentioned on the program level.

The program quality review is the activity to make sure that the quality plans are implemented at projects level and program level. The program quality audit is independent and documented examination and verification of a program quality to determine their conformity with the requirements of the quality standards. It can be conducted by agents internal or external to the organization. The program benchmarking involves comparing actual or planned program practices to those of comparable program to identify best practices, generate ideas for improvement, and provide a basis for measuring performance.

 Let us review the following quality tips starting with the quality and grade. To understand the difference between quality and grade, let us imagine that we have two cards created according to the requirements with good quality. If we say that one of these two cars is BMW while the other is Hyundai, we will expect that BMW car will have a higher grade than Hyundai. Although both of them have the same quality as they were created according to the requirements. Another tip is related to continuous improvement or continual improvement. Continuous means uninterrupted in time, but continual means often repeated or very frequent. Practically, you cannot improve without interruption or period to wait and test the result of your improvement. So the right term is continual improvement.

The third tip is related to the audit. The audit is some formal independent examination of a product, service, work process, department or organization. A quality audit is an assessment to determine whether agreed upon quality requirements are being met. The different types of audits are first party, which is the internal audit where the auditor and the audit are from the same organization. Second party like customer, is auditing his supplier. Third party is the external audit like the ISO audit or a financial audit. Another famous example is that the customer will bring an external company to audit his supplier.

8. Program Risk Management

Program risk Management involves risk planning, identification, analysis, assessment, response planning, and risk control. A program risk is an event or series of events or conditions that, if they occur, may affect the success of the program. Positive risks are often referred to as opportunities and negative risks as treats. Remember that the risk with 100% probability is an issue.

Please note that the risk management is described in details in the PM book, but it is briefed in the Standards for Program Management Third Edition. Let us review the activities and their outputs of the Program Risk Management Supporting processes during the different phases of the program lifecycle. As we can see from this chart, the risk management supporting activities group spends over the program definition phase and the program benefits delivery phase. Starting with the program definition phase, we have one activity. Which is? The program risk management planning. This activity has one output. Which is the program risk management plan.

Then in the program benefits delivery phase. We have four major activities which are program risk identification, program risk analysis, program risk response planning and the program risk monitoring and control. The program risk identification activity has one output. Which is the program risk register. The Program Risk Analysis has the following outputs updated risk Register and the periodic risk reports showing read and opportunity. Key performance indicator trends. The program risk responsibly have the following outputs definitive response plans, risk register updates, contingency budgets, and the change requests.

And finally, the program risk monitoring and control have the following outputs timely execution of a risk response when a risk event occurs, monitoring the effects of the response with further action, documented lessons learned, and updated risk register. The Risk Management Plan is created to describe how the program risk management activities will be structured and performed. It has the following components risk team roles and responsibilities risk scoring and ranking where risks will be ranked and prioritized based on the risk impact and risk probability.

Risk impact and Probability where rules for risk impact and risk probability are defined risk categories risk assessment and reassessment timing process and procedures risk Escalation process stakeholders tolerance for the risk, risk reporting format and risk tracking approach the Risk Register is the document that contains risk description and its attributes from the identification until it is closed.

Usually, it is created in table format and has the following items risk title and description risk impact, which may be qualitative like high, medium, and low or quantitative for example, to have a number between one and five. Risk probability, which may be qualitative like high, medium, and low or quantitative, like a number between one and five. Risk rank, which is a multiplication of risk impact and risk probability risk category, risk owner, risk status and risk response Plan Let us review the following risk highlights the secondary risk is the risk reason as a direct outcome of implementing the risk response for one of the listed program risks.

The residual risk is the risk that expected to remain after the bland responses have been taken, as well as some others that have been deliberately accepted. The Black Swan is the risk related to few low probable events that will affect the program dramatically when all of them have been together. The watch list is the list that contains the risks with apparently low rating of probability and impact and that are not retained for additional work. The response plan is the act of developing and enlisting a series of options in hopes of reducing any threats that may exist as a result of risk.

Continuing with the risk highlights the contingency plan is a part of the risk responsible, and it is a process that prepares the program to respond coherently to a risk event. The Fallback blend is created for use as a response to a risk that has occurred, and the primary response doesn’t work as bland. Continuing with the risk highlights the risk appetite is the degree of uncertainty an entity is willing to take on in anticipation of a reward. The risk appetite is a tendency rather than a measurable item. It is like the hunger that you cannot measure. The risk tolerance is the degree or volume of risk that an organization will withstand. The risk tolerance is a measurable item from its definition. For example, humble an organization may have risk tolerance of.

9. Program Financial Management

Financial management covers defining the program’s financial resources, developing the overall budget for the program, and integrating or developing the program components budget. It includes also controlling costs for both the components and the program. Once the program receives initial funding and begins paying expenses, the financial effort moves towards tracking, monitoring, and controlling the program funds and expenditures. Let us review the activities and their outputs of the program financial management Supporting processes during the different phases of the program life cycle. As you can see from this chart, the Financial Management Supporting Activities group spends over the program definition phase, the program benefits delivery phase, and the program closure phase.

Starting with the program definition phase, we have three major activities, which are the program cost estimation, the program financial framework establishment, and the program financial management plan development. The program cost estimation activity has one output, which is the program cost estimates. The Program Financial Framework establishment has the following outputs the Program financial framework, the business case updates and updates to the Communications management and Stakeholder engagement plans and the Program Financial Management plan. Development activity has the following outputs the Program financial management plan, the program funding schedules, the component payment schedules, the program operational costs and the program financial metrics.

Then, in the program benefits delivery phase, we have three major activities, which are the component cost estimation, the program cost budgeting, and the program financial monitoring and control. The component cost estimation activity has one output, which is the component cost estimates and documentation. The program cost budgeting activity has the following outputs the program budget baseline, the program payment schedules, and the component payment schedules.

The program financial monitoring and Control measure activity has the following outputs the contract payments, the component budgets closed, the program budget baseline updates, approved change requests, estimate at completion, program management plan updates and corrective actions. And finally, in the program closure phase, we have one major activity, which is the program financial closure. This activity has the following outputs input to final performance reports, updates to the program financial management plan, input into the knowledge repository, documentation of new tools and techniques, financial closing statements, and closed program budget.

The program financial management plan is a component of the program management plan. The program budget, once baselined, becomes the primary financial target that the program is measured against. Let us highlight some important points in the program financial management. The program funding source may be different from the component’s funding source.

The program funding models are funded within a single organization, managed within a single organization, but funded separately, funded and managed it entirely from outside the parent organization, supported with internal and external sources of funding. The funding organization usually has significant inputs to the program management and to the major decisions to be made by the program team. The remaining budget at the end of the program is returned to the funding organization. Continuing the Program Financial Highlights let us see the difference between the program payment schedules and the component payment schedules.

The program payment schedules cover the points where funding is received by the funding organization, but the component payment schedules cover the points to pay the contractors. The order of magnitude is a rough estimate with plus or minus that allows the decision to be made whether the program to be funded or not. The total cost of ownership is usually used to determine the direct and indirect costs of a product or a system. But in the program management it is defined as the total of the full life cycle costs and the sustainment costs.

10. Program Procurement Management

The program procurement Management addresses the procurement needs for the program and components level. The most effective way to deal with the components procurements is to have them centralized within the program. In most of the cases, the program will follow the performing organization procurement process. However, in some exceptional cases, the program will have its procurement process outside the performing organization. The component manager usually manages the contract execution within the scope of his component, including details of contract deliverables requirements, deadlines, cost and quality believes.

Note that the procurement management is described in details in the PM book, but it is briefed in the Standards for Program Management Third Edition. Let us review the activities and their outputs of the Program Procurement Management Supporting Processes during the different phases of the program lifecycle. As you can see from this chart, the Procurement Management Supporting Activities Group spends over the program definition phase, the Program Benefits Delivery phase, and the Program Closure phase. Starting with the Program Definition phase, we have one major activity, which is the Program procurement Planning. This activity has the following outputs program Procurement Standards, program Procurement Plan and Program Budget or Financial plan updates. Then, in the Program benefits Delivery phase, we have two major activities, which are the program procurement and the Program Procurement Administration.

The program procurement activity has the following outputs which are request for quotation, request for proposal, invitation for Bid proposal evaluation Criteria contracts, management plan and awarded contracts. The Program Procurement Administration activity has the following outputs performance or earned value reports, monthly Progress Reports vendor or contract performance reports, including key performance indicators assigned to the contractors and finally, in the program Closure phase, we have one activity, which is the program Procurement Closure. This activity has the following outputs contract close out reports, updates to lessons learned and closed contracts.

Regarding the procurement plan, the Program Manager looks across all program components and develops a comprehensive procurement plan that optimizes the procurements to meet the program objectives and for the delivery of the program benefits. The program procurement plan should consider the following request for Quotation, request for Proposals, invitation for Bid Proposal Evaluation Criteria, Contracts Management Plan and Awarded Contract agreement is a legal document binds the organization with a vendor according to special terms and conditions. It contains usually the following references to the two bodies having the agreement scope of work, major Deliverable, high Level Time Plan implementation, team Structure and Location acceptance criteria change request handling, payment Terms warranty and Penalties legal Section to protect each party rights, prices and legitimate signatures.

11. Program Management Supporting Processes Conclusion

In this section, we cover the program management supporting activities groups as per the following sequence the program integration management, the program scope management, the program communication management, the program resource management, the program schedule management, the program quality management, the program risk management, the program financial management, and the program procurement management.

In each of these activity groups, we reviewed the sub activities and or the outputs of each activity of the group during the different phases of the program life cycle. We then pointed some important artifacts created during the activity of execution in each group, and we also outlined some highlights and tips of the previous groups.