PMI PMP Project Management Professional – Project Environments

1. Section Overview: Project Environments

In this section, we’re going to discuss a very important exam topic. We’ve already talked a little bit about it in previous sections, but now we’re going to get into the very specifics. But what is the topic? Project environments. Remember the environment that you operate in as a project manager fact how you get to manage that project.

So we need to look at the project environments. So some new terms for you. We’re going to look at enterprise environmental factors and organizational process assets. These are things that will be an input to a lot of processes, and then you’ll update them as your project creates more information. So we’ll talk about enterprise environmental factors and organizational process assets. You can abbreviate those like I do, and we’ll call them EEF and Opas.

So that’s what that means, but you’ll pick that up in no time. We’ll also look at processes, policies and procedures. So what are the processes that you do in your organization? What are the policies that restrict or control how you do that process? And what procedures do you have to follow as a PM, where you work specific to your organization? We’ll look at organizational systems and frameworks; the management elements that affect how you manage your project. And then a really important topic, I hinted about it a little bit earlier, it’s organizational structure types.

It’s how is the organization structured like lines of business, by projects, by different departments. So the organizational structure type affects how much power you get as a project manager. So I hinted at this a little bit earlier. Well, this is where we’re going to get into these different structure types. And then you will do an assignment about defining these different organizational types. So really important you complete that because you need to know these structure types for your exam. You need to know how do you operate as a project manager in any given structure. And so right now, if you don’t work in that particular structure, you can see how that will be a challenge on your exam if you don’t know the nuances of that structure. Okay, let’s hop in here and knock out this section about project environments. Let’s get going right now.

2. Enterprise Environmental Factors

A term you’ve seen already several times in this course. And I promise you, you’re going to see it several times more throughout the course is enterprise environmental factors. So let’s take a look at enterprise environmental factors and how they affect our projects. Enterprise environmental factors can directly or indirectly influence how you manage the project. Directly means you have to use this form. You have to use this process indirectly. Could be just the structure of the organization or the workflow or how you get people on and off your team.

Project managers really have no control over enterprise environmental factors. We have no control over policies and procedures that you must do that’s outside of the project. Enterprise environmental factors can be things like rules and policies and regulations and laws. Anytime that you are required that you must do a certain procedure in your process, you’re likely dealing with an enterprise environmental factor. There are two types of enterprise environmental factors. We have internal and external. Let’s talk about internal. First, internal enterprise environmental factors or EEFs are created by the organization but outside of the project. So you must use this particular piece of software. You must have a communications report every Thursday. You must follow this process for procurement. So it’s outside the project and it’s rules or policies that you have to follow. Some examples here could also be organizational culture, just the structure of the organization. We’ll talk a little bit more about the structure coming up because how your organization is structured will affect how much authority you have on the project. So we’ll take a little bit more look at that coming up. Some other things here in this category. Things like leadership, the vision, the belief in the organization, the hierarchy of management ethics, the organizational code of conduct, expectations, the physical location of resources, both physical and human resources.

These affect how you manage the project. So if you need to get to a piece of equipment, but it’s in another state, then you’ve got to coordinate the logistics to get to that piece of equipment or to get materials on site. And there’s only so much room on site for the materials. That’s just the way it is. It’s an enterprise environmental factor. And also people can be distributed. We use virtual teams now where they’re non colocated. But occasionally those people have to come into the job site. So you have travel and expenses and logistics there to consider the infrastructure of your organization. So think about the It infrastructure, how you access data and printers, how you log in, the security. Also the more than It as well the facilities or the equipment.

How do you check in and check out equipment? Is there accountability for the equipment that’s part of an internal EEF? Some other things here that we have to think about. It software, so we have software for scheduling that you have to use like Microsoft Project or Basecamp or Primavera. So there’s some things there that affect our approach. Configuration management, how do you document and control the features and functions of the thing your project is creating? So the product is an enterprise environmental factor as far as configuration management goes.

And then the work authorization system, how do you approve work, how do you schedule work, especially if you’re in a very complex matrix environment, which we’ll see that coming up. But you have people from all over the organization, so there’s a lot more communication and a lot more scheduling that would go into that scenario. Tied to that, we have resource availability. So people, tools, equipment, how do you obtain those resources? You have to go through procurement, do you have to fill out a form? Do you have to go talk to someone? So it’s just these layers of activities that you have to do. But it’s tied to accountability in your organization to get to the people, the tools, the facilities that you need on your project.

And then we have employee capability, just what’s the capabilities of the people in the project. So there may be some training that’s needed, some team development. You may have to help people along early in the project until they can get moving and get going. So those are all internal enterprise environmental factors. What about external environmental factors? External environmental factors are things outside of the organization, outside of your company. So external are things like laws, regulations, marketplace conditions. So you think about buying things and supply and demand and how that affects price or who you’re allowed to purchase from. As far as laws in different countries and what type of security or encryption among different countries.

So that can affect your project. You also have cultural influences and issues. So think about the political climbing, especially if you’re in a government project, customer perceptions of the technology or the solution or your organization. So that could affect how you manage the project. Then things in the news, especially if you’re a large organization and you’re doing a public type project, so what the news reports about your project or the endeavor, well, obviously that can affect your relationship with the public and how you manage and do stakeholder engagement. Of course, laws and regulations, those are always going to be external enterprise environmental factors.

And then a new idea here for you is a commercial database. A commercial database is an organization can purchase a piece of software, a database, and then that database will help predict duration or cost or risk or benchmarking. So, for example, years ago, I was consulting in a printing company and we printed the lids to the top of yogurt, those yogurt lids that you peel off that foil lid. We printed the lids to that. Well, they had a piece of software where we would punch in the thickness of the foil. There’s different thicknesses, the number of colors used, and then which printing press that was going to be printed on and it would predict how many units or lids you could make per hour and how long it would take. So that was a commercial database. So you have these different factors. You might have one in your industry, like in construction, like cost per square foot or the type of square foot, like the kitchen versus the garage.

So how does that affect framing and timing? So in your industry, you might have a commercial estimating database or a commercial database, and that’s an external it wasn’t created in your company, but you use it to predict time and cost and risk management and benchmarking some other external enterprise environmental factors. Here academic research. So your organization may rely on white papers or studies from different universities and that helps you to manage your project, government and industry standards that are unique to your discipline. So it healthcare, insurance, manufacturing.

So you have some standards. Now, a standard isn’t necessarily a law or regulation, but it’s a best practice, like an industry standard, financial. So your organizations that span multiple countries, you’ve got exchange rates and tariffs and taxes and other things that you have to consider on long projects. We may have to take into consideration taxes, so taxes and interest rates, things like this. I said taxes, but in particular, really interest rates. So if you’re financing the project, the cost of financing that is something we should consider. And then physical enterprise environmental factors, the weather, the environment where the project is physically taking place, those are physical enterprise environmental factors. All right? So those are our enterprise environmental factors, internal and external journal. And we’ll see that a few more times throughout the course. In fact, we’ll see EEF an awful lot as we move through the course because that affects each process. These can have some bearing on those. All right, good job.

3. Organizational Process assets

We just took a look at Enterprise Environmental factors. Organizational process Assets follow EEF a lot of times we’ll see a process for its inputs. Enterprise environmental factors and organizational process assets or OPA. Organizational processed assets are resources within an organization. They’re things that you can leverage, things that have been researched and created for you or the things that can be interviewed. Like people. Historical information is one of your best OPA because historical information is proven information, it’s past experiences that you can leverage to manage your current project. So a great example of this would be we treat historical information like a template. A lot of times we think of a template as a form that has been created for us that we fill out. And certainly that’s a template, like a scope template or a charter template. But a template can also be that we take a prior project. For example, we could take the quality management plan from a prior project and just adapt it to our current project that’s similar.

Or we could take the scope from a similar project that we don’t have to write it from scratch. Every time we’ll work smart, we’ll take something similar and use it as a template so that we can save time and have historical information that’s been proven. So historical information is one of our best organizational process assets. We also have some common Opas. You should be familiar with standards, policies and organizational procedures. Well, a lot of times people say wait a minute, policies were also enterprise environmental factors. How can they be both? Well, policies can be both, standards can be both, that it’s not always it being enterprise environmental factors are always things that constrain you. They can also be things that have been created for you and that have been established for uniformity. So policies could be how changes are allowed to come into the project or how you must do cost estimating or time estimating, duration estimating, how people are allowed to come onto your project or communicate directly with the project team.

So those could be policies and standards as well. So yes, they’re enterprise environmental factors, things that you must follow. But in OPA they can also be things that help you. So I like to think of enterprise environmental factors are things that restrict your choices almost like a constraint because you must do it. OPA are things that help you have been created for you to make your project more successful or to try to massage the conditions to allow your project to be more successful. Your organization might have some standardized guidelines or performance measurements that you have to adhere to. So like you can’t be too much over cost or too much below cost or off schedule too much, or you can’t leave a phase until you have this level of performance or this level of accuracy. You might have templates, as I just mentioned, for project documents like a scope template or a charter template and that we can use historical information for that.

And you might have some guidelines for adapting project management processes. So what this means is you could look at those 49 project management processes in your organization. You can say, okay, this is how we as an organization will define scope, this is how we create the work breakdown structure, how everyone does it the same way, or how we do quality control, or how we do stakeholder engagement. So just some guidelines for how do you do those processes in your organization? There’s not a universal way to do every process because every organization and every project is different. So I get questions sometimes via email from folks that they’ll ask, do you have a template for a project charter I could use? Do you have a template for a risk management plan?

Well, yes, but no, it’s not really appropriate for you because where I created those was a totally different organization and the risk and the scope and the concerns of that organization were unique to that company, but it’s probably totally different from your company now there are forms and templates. In fact, PMI has a whole book on forms and templates, but you can’t just take those and there you go and shove it into your project. They have to be adapted and created for your organization. So this is the idea here with these Opas that it’s adapting the project management processes, but for your projects, for your organization, that there’s not a one size fits all when it comes to Opas and these processes, some common Opas we should be familiar with, financial controls for purchasing. So again, forms and processes and workflow accounting codes that are unique to your organization, how you do procurement, where you are, communication requirements, things like standard forms, procedures, reports, those are communication requirements.

Then we have processes for project activities. So change control, how you do change control in your organization, how do you close out the project? What about communications, financial controls and risk control procedures? So those are all OPA. Those have been established or adapted for what’s best in your organization and then project closing. So how do you do acceptance and sign off? Do you have a certificate of completion or is there a sign off that the scope has been done? So how do you close out the project? How does the customer validate the product?

So is there an operational transfer? And you have something written that the project is now closed and this is now part of production or operations? Or is it kind of a nonevent? So what’s the norm for your organization? And then evaluations. So we think about evaluations of the project, of the product, of your project team, some assessments there that those could be an OPA. We’ll see organizational process assets a lot. It’s an input to a lot of our 49 processes and it typically goes with EEF that those two go together. We’ll also see throughout our examination of the outputs of a process, is that OPA and enterprise environmental factors are often updated to reflect what’s happened in the project. All right, good job. I’ll see you in the next lecture.