Project Management Fundamentals and Core Concepts · Topic 5 of 6
Initiation, Benefits and Following Planned Strategies
CAPM initiation and execution: business case, benefits management plan and charter, then following the communication plan and planned risk responses.
- 4 min
- Business case: why. Benefits management plan: what benefits and how measured. Charter: authorizes the project.
- The sponsor usually issues the charter, which names the project manager.
- Communication: interactive, push, pull; channels = n(n minus 1) / 2.
What it is
A project starts with initiation: a business need is justified, expected benefits are defined and the project is formally authorized. After planning, the team follows the planned strategies: it communicates as the communication plan says and responds to risks as the risk plan says.
How it works
Initiation documents
| Document | Purpose |
|---|---|
| Business case | Explains why the project is worth doing: the problem or opportunity, options, costs and expected benefits |
| Benefits management plan | Describes the benefits, when and how they will be delivered and measured, and who is responsible |
| Project charter | Formally authorizes the project and gives the project manager authority to use resources |
The charter typically includes the project purpose, high-level requirements and risks, a summary milestone schedule, a summary budget, key stakeholders, and the name and authority of the project manager. It is usually issued by the sponsor.
Benefits
A benefit is a gain the organization realizes from the project's outputs, for example lower costs or more customers. Benefits often appear after the project ends, so the benefits management plan says how they will be tracked. Project success is not only on time and on budget; it is also whether the expected benefits are realized.
Following the communication plan
The communications management plan says who needs which information, when, in what format and through which channel.
| Communication method | Meaning | Example |
|---|---|---|
| Interactive | Two or more parties exchange information in real time | Meetings, calls, video conferences |
| Push | Sent to specific recipients | Emails, memos, reports |
| Pull | Placed where recipients access it when they need it | Intranet sites, knowledge bases, shared folders |
The number of communication channels between people is n(n minus 1) / 2. A team of 6 has 6 x 5 / 2 = 15 channels. Adding a seventh person makes 7 x 6 / 2 = 21 channels.
Following the plan means sending the agreed reports on time, to the agreed audience, in the agreed format, and updating the plan through change control when needs change.
Following the risk plan
Planned risk responses are carried out as agreed: some, such as mitigation, are done in advance, and contingency responses are carried out when a risk trigger occurs.
| Threat response | Meaning |
|---|---|
| Escalate | The threat is outside the project's scope or authority; pass it to the right level |
| Avoid | Change the plan to remove the threat |
| Transfer | Shift ownership and impact to a third party, such as insurance or a contract |
| Mitigate | Reduce probability or impact |
| Accept | Acknowledge it; actively with a contingency reserve, or passively |
| Opportunity response | Meaning |
|---|---|
| Escalate | Pass it to the right level |
| Exploit | Make sure the opportunity happens |
| Share | Give ownership to a party better able to capture it |
| Enhance | Increase probability or impact |
| Accept | Take advantage if it happens, without pursuing it |
A risk owner is responsible for making sure the agreed response is carried out. A workaround is an unplanned response to a threat that occurred and had no planned response, or whose planned response did not work.
If the plan already holds a response for a risk that just occurred, the right answer is to carry out that planned response, not to invent a new one.
How the exam asks about this
- "Which document formally authorizes a project?" The project charter.
- "How many communication channels does a team of 8 have?" 8 x 7 / 2 = 28.
- "The team buys insurance against equipment damage. Which response?" Transfer.
What to remember for the exam
- Business case: why. Benefits management plan: what benefits and how measured. Charter: authorizes the project.
- The sponsor usually issues the charter, which names the project manager.
- Communication: interactive, push, pull; channels = n(n minus 1) / 2.
- Threat responses: escalate, avoid, transfer, mitigate, accept.
- Opportunity responses: escalate, exploit, share, enhance, accept.
Mitigate and avoid are different. Avoid removes the threat by changing the plan; mitigate only reduces its probability or impact.
Common mistakes
Starting work before the charter is approved. The charter authorizes the project.
Forgetting to count yourself in channel questions. Count every person, including the project manager, if the question includes them.
Inventing a response when one is already planned. Follow the risk register.
Check yourself
What is the purpose of the business case?
To justify the project by explaining the need, options, costs and expected benefits.
What is the difference between push and pull communication?
Push is sent to specific recipients; pull is placed where people can access it when they need it.
Which opportunity response makes sure the opportunity happens?
Exploit.
Topic 5 of 6 in Project Management Fundamentals and Core Concepts
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