Prince2

Abstract

Many major projects fail due to complexity and poor management. The use of a standardized project management methodology is in many cases a necessity in order to achieve desired progress and meet project objectives. PRINCE2 (PRojects IN Controlled Environments) is a widely used project management methodology and highly useable for managing advanced projects. It is designed to drive projects with focus on benefits in each stage of the project. The essence of PRINCE2 is to break the project down into smaller stages which simplifies the project's process. Many different international standards exist, where most project management standards are process oriented. The two dominant process-oriented certification bodies internationally are AXELOS Ltd’s PRINCE2 and The Project Management Institute (PMI) with Project Management Professional (PMP) based on the Project Management Body of Knowledge (PMBOK Guide).

The following article will describe what role PRINCE2 plays in project management. Moreover, the PRINCE2 methodology is described with respect to its principles, themes and processes. Similarities and differences between PRINCE2 and the PMBOK Guide are outlined to enlighten common misconceptions that are important to address as they are among the most used standards in state-of-the-art project management. While PRINCE2 describes in detail how to manage a project as a whole, the PMBOK Guide focus on project management knowledge. A critical evaluation of PRINCE2 it undertaken, to demonstrate the limitations it has. The article will describe how the PMBOK Guide can cover PRINCE2 limitations.

Background

It is first of all important to point out why one need project management certifications such as PRINCE2, and why there is a need for project management at all. A survey from the international consultancy company PwC states that “higher-performing projects are significantly more likely to be staffed with certified project managers” . The organization Project Management Institute defines project management as “the application of knowledge, skills, tools and techniques to project activities to meet the project requirements.” In order to efficiently execute projects in an effective manner, good project management is the key. Good project management will help individuals, groups and organizations to:

• Increase chances of success
• Predict better
• Satisfy stakeholders
• Meet desired objective(s)
• Resolve issues as they appear
• Manage constraints, such as schedule, scope and costs
• Manage change conveniently

In contrast. Poor project management skills may result in:

• Cost overruns
• Deadline overruns
• Rework
• Failure to meet desired objective(s)

As development of successful projects represents a key role in creating value for a given organization, it is clear that effective project management is critical for the organization as a whole. PRINCE2 is a proven best practice in project management and provides a common language for the project’s participants. Using a project framework everyone agrees upon makes communication easier, whereas there is a common understanding of steps and roles. The efficiency of implementing projects increases. Benefits are many and proven.

Overview

Figure 1: PRINCE2 structure

PRINCE2 is a project management methodology and stands for PRojects IN Controlled Environments. It is used globally and based on experience from professionals within a variety of different professions and industries. It is generic and can be applied to projects of different art, regardless of project scale, type, organization, geography or culture.

The method can be described with four integrated elements: principles, themes, processes and project environment.

PRINCE2 principles

The PRINCE2 principles are important to be familiar with when determining whether a project should be managed with PRINCE2 or not. There are seven principles that must all be fulfilled for a project to be appropriately managed by the use of PRINCE2.

The seven PRINCE2 principles are:

• Continued business justification
  • There must be an approved justified reason for initiating the project. The justification will have to continue throughout the life of the project.
• Learn from experience
  • Project’s team members learn from experience. Reviewing previous projects so that lessons are learned before initiating a project. The learning process continues throughout the project so that improvements can be incorporated during the life span of the project. Experience and lessons learned from the project shall be passed on.
• Defined roles and responsibilities
  • Established roles and responsibilities within the structure of the organization which involves the stakeholder interest for those involved.
• Manage by stages
  • A project must be managed stage-by-stage. The PRINCE2 project is required to have a minimum of two stages: the initiation stage and an additional management stage.
• Manage by exception
  • Responsibilities for directing, managing and delivering projects are clearly defined so that accountability is maintained on all levels. Accountability is secured by delegation of authority from one management level to the next by defining performance tolerances by: cost, time, quality, scope, benefits and risk. Exceeded tolerances are defined as an exception and upper management will have to decide on how to handle the issue.
• Focus on products
  • Quality requirements are important in PRINCE2 as projects with this focus tend to be successful.
• Tailor to suit the project
  • PRINCE2 universal nature towards managing projects is retained because of its design to be tailored. As a consequence, it can fulfill required needs.

PRINCE2 themes

The themes address what is critical to address when it comes to project management. This is an ongoing progress throughout the project’s lifetime.

Theme	Description	Answers
Business case	Justification for undertaking the project	Why?
Organization	Roles and responsibilities	Who?
Quality	Quality of the deliverables (products)	What?
Plans	Description of how to make/modify the project’s products. Time and money required. When to perform activities	How? How much? When?
Risk	Plans on how to manage risk	What if?
Change	Management of change and impact general change	Impact?
Progress	Viability of the project's plans	Status? Direction? Continue?

PRINCE2 processes

The processes describe the project’s progress during its lifetime. From before initiating project activities to the closure of the project. The process based methodology in PRINCE2 provides checklists with recommended activities, products and respective responsibilities.

The seven PRINCE2 processes are as follow;

• Starting up at project: consider if the project is fundamentally a good idea. Choose whether to continue or close down the project.
• Directing a project: the project board make key decisions and are accountable for the project’s success and manage an overall project control.
• Initiating a project: establishment of foundations for the project. Making sure that the organization knows what needs to be done in order to fulfill the project’s objectives.
• Controlling a stage: assign and monitor work. Problem solving, reporting progress to project board.
• Managing a stage boundary: reporting stages and plan the next stage.
• Managing product delivery: controlling the relation between project manager and team managers. Requirements for acceptance, execution and delivery are to be agreed on.
• Closing a project: product deliverables are being handed over and budget closed.

How PRINCE2 relates to PMP

There are many different project management certifications out there. When it comes to comparing PRINCE2 in relation to the many certifications, one can point out Project Management Professional (PMP) and the PMBOK Guide as a natural basis for comparison. After all, PRINCE2 and PMP are two of the most recognized project management certifications on the market.

Comparison

A certification in either of the two methods will consequently require time and money invested. Identifying the differences and similarities may be of interest as selecting the right certification can be confusing. A key aspect to point out is that PRINCE2 is more concerned with managing the project as a whole, while the PMBOK Guide describes the knowledge required by a project manager. That being said, PRINCE2 and the PMBOK Guide complements each other. Rather than choosing one of them it can be advantageous to choose both.

The PMBOK Guide is a guide provided by the Project Management Institute that describes a body of knowledge, generally speaking – a set of standard project management terminology and guidelines. The body of knowledge is generic and thus applicable to all kinds of projects. It is a process-based approach where work is accomplished by processes. The processes consist of ten knowledge areas: integration, scope, schedule, cost, quality, resource, communications, risk, procurement, stakeholder.

The PMBOK Guide supports the project manager on what he or she should do in a guidance format, while also providing tools and techniques. However, the PMBOK Guide is limited when it comes to methodology. PRINCE2 comes in handy here, whereas it covers defined roles and responsibilities, activities order, objective descriptions. Moreover, PRINCE2 also provides principles which makes it easier to know how to use it. Unlike the PMBOK Guide, PRINCE2 will not describe specific tools and techniques.

One can say that the PMBOK Guide gives a project manager knowledge in project management, while PRINCE2 will answer multiple questions according to the different themes in how to actually manage a given project.

Differences

The are some differences between PRINCE2 and the PMBOK Guide although they are complementary. Their view on constraints vary, where the PMBOK Guide defines it as a “limiting factor that affects the execution”. Costs, schedule, scope, risk and resources are mentioned constraint examples. PRINCE2 employs tolerances instead of constraints in order to control the project – with a total of six tolerances. They work as defined acceptabilities; if everything stays within the given tolerances, the project is under control. If exceeded, the situation must be acted upon and managed by exception.

Phases/stages Progression in the PMBOK Guide is divided into what is called phases, PRINCE2 use stages. Stages in PRINCE2 are more detailed and they cannot overlap. As a consequence, the project sponsor gains more authority. The phase concept in the PMBOK Guide is more general and can even overlap each other.

Business case A business case can be defined as a project’s justification. The business case is dynamic in PRINCE2 and therefore updated throughout the project’s process. The business case work as an input to the project charter (project brief in PRINCE2) in the PMBOK Guide and is used statically.

Organization PRINCE2 is highly organized where it takes care of project governance. Interest of the three primary categories of stakeholders (business, user, supplier) are represented. Delegation and reporting routines are defined. The PMBOK Guide does not provide an organizational setup as it has a more general approach towards organization describing overall roles such as project manager, project stakeholder.

Scope management The PMBOK Guide manages scope generally, based on agreed requirements. The scope is then organized into a work breakdown structure (WBS). A similar approach is used in PRINCE2, but with focus on actual outputs, the deliverables of the project. The project’s deliverables are described with acceptance criteria’s and what the customer expects when it comes to quality. A product breakdown structure (PBS) is used. As the PBS can be categorized as a special kind of WBS they can be used together. By using both approaches the project scope can be view with different perspectives for multiple stakeholders.

Certification

Accreditation of PMP and PRINCE2

In order to get a PMP or PRINCE2 (Foundation or Practitioner) certification one must sign up for an exam. A brief overview of the different exams:

	PMP	PRINCE2 Foundation	PRINCE2 Practitioner
Exam literature	PMBOK Guide	The official manual, Managing Successful Projects with PRINCE2	The official manual, Managing Successful Projects with PRINCE2
Questions	200	50 (28 marks or above to pass)	68 (38 marks or more required to pass)
Format	Multiple choice	Multiple choice	Multiple choice
Question style	Abstract	Objective testing	Scenario, additional information and questions
Time	240 min	60 min	150 min
Aid	None	None	Open book
Location	Specified	Specified/online	Specified/online

The PRINCE2 Practitioner exam is slightly different from the PRINCE2 Foundation exam as the certification is divided into two levels. PRINCE2 Foundation certification represents the PRINCE2 entry level certification. The PRINCE2 Foundation exam is the most basic among the three exams. PMP and PRINCE2 Practitioner can be described with equal level of difficulty, although this is a subjective matter.

Prerequisites

There are no formal prerequisites for taking the PRINCE2 Foundation exam. For PRINCE2 Practitioner candidates must provide proof of having passed PRINCE2 Foundation or PMP (there are also other exceptions). In order to take a PMP certification candidates must have project management experience. The amount of hours experience needed varies with educational background, split into second degree and four-year degree. Four-year degree candidates need at least 3 years of project management experience (5 years for professionals with a second degree only). 4500 hours of leading experience in directing project must also be obtained (7500 hours for professionals with a second degree). 35 hours of formal project management experience is also required for both four-year and second degree holders.

Practical Costs

In order to get a PMP or PRINCE2 certification the candidate must pass examination which involves a financial cost, in addition to the cost of the PMBOK Guide and “Managing Successful Projects with PRINCE2” materials respectively.

	PMP certification	PRINCE2 Foundation certification	PRINCE2 Practitioner certification
Exam litterature	PMBOK Guide 6th ed. ≈ $51	Managing Successful Projects with PRINCE2 2017 ed. ≈ $91	Managing Successful Projects with PRINCE2 2017 ed. ≈ $91
Exam cost	For PMI members $405 and $555 for non PMI members	Varies as price is set by AXELOS partners	Varies as price is set by AXELOS partners
Renewing	Every 3 years	Not necessary	5 calendar years after certification

The examination cost for PRINCE2 is not fixed as AXELOS does not provide examination themselves but in partnership with others. Getting a PRINCE2 certification will therefore vary from country to country and also with examiner of choice. Moreover, it will depend on whether the candidate gain the needed knowledge by self-studies, from a course online or through an AXELOS partner providing a seminar or similar. Poor project management may result in severe consequences like missed deadlines and cost overruns. Improving team members project management skills by taking the financial cost of acquiring both a PRINCE2 and PMP certification can therefore be argued for.

PRINCE2 and the PMBOK Guide - summarized

Using PRINCE2 and the PMBOK Guide together contributes to method and knowledge respectively. The PMBOK Guide provides a body of knowledge which is highly necessary for project managers so that they can be confident in their management role. With PRINCE2 project managers have a process-based method to work with, securing a satisfying progression. The complementary aspect is a key reason for why PRINCE2 and the PMBOK Guide should live alongside with each other. Even though certification in both will be of great cost, the consequences of poor project management skills will be many, and likely surpass certification costs.

Critical Evaluation

PRINCE2 is a powerful project management method, but it has some constraints, and the use of it does not guarantee for a project succeeding. It can be considered unsuitable for smaller projects, or for projects where requirements are particularly dynamic. This can be explained by work intensive procedures related to a continuous need for documentation and logging. Using PRINCE2 for the smallest projects may simply be unnecessary in relation to the gains achieved. It can in some cases lead to a pointless production of different management related documents with no or minor substance. This can contribute to a situation where the focus on management is unbalanced with the actually work being done. The extra documentation time required is simply not justifiable.

On the other side, one can argue that PRINCE2 can be scaled and tailored to meet the concerns about an excessive focus on the management part of a project. However, by using the stated argument it is hard deny whether PRINCE2 is appropriate as a project management tool as any confrontational problem can be characterized as an improper use of PRINCE2. This reasoning will not accuse the PRINCE2 methodology as a reason to the problem itself, but rather the application of it.

Generally speaking, three different categories are to be recognized as omitted from the PRINCE2 scope:

Specialist aspects

Its generic nature makes it less suitable for activities that are specified for unique activities within different industries. Agile methods, specific techniques including change management or procurement and project lifecycles which all are seen as specific activities, can although be used along with PRINCE2.

Detailed techniques

Well known techniques in planning and control, such as critical path analysis, are not described in detail in PRINCE2. Only techniques that are unique to PRINCE2 or specifically recommended for a certain planning and control setting are described in detail. An example is the PRINCE2 quality review technique.

Capability for leadership

It is not possible to methodize a leadership style that works in every single situation. This is important to empathize as leadership, motivational skills and similar are vastly critical in project management. One cannot simply set a fixed method for leadership, as one leadership style may work well in a given situation and completely unsuitable in another.

Conclusion

PRINCE2 is a project methodology suitable for any kind of project, with its structured process-based approach. The PMBOK Guide can contribute to the three different categories recognized as omitted from the PRINCE2 scope; specialist aspects, detailed techniques, capability for leadership. Knowledge from the PMBOK Guide can provide the project manager with confidence and a point of reference when being confronted with management challenges that are non-typical (specialist aspects). The PMBOK describes techniques in project management, such as critical path analysis, in detail. Although it is not possible to methodize a leadership style that work for every situation, the PMBOK Guide introduces different leadership styles in chapter 3, “the role of the project manager”, that can contribute to a project manager’s capability for leadership. Certifying in both PRINCE2 and PMP is of great financial cost and requires hours spent on training. However, PRINCE2 managers will need a body of knowledge, in order to be confident in their management role. And the PMBOK Guide requires a methodology, such as PRINCE2, that team members can use for their projects in order to achieve good project management.

Annotated Bibliography

Nigel Bennett, Robert Buttrick, Phil Stanton. 2017. Managing Successful Projects with PRINCE2, 6th ed. Norwich: AXELOS Limited The Managing Successful Projects with PRINCE2 is the most used reference in the article. It is used as literature for explaining the key aspects of PRINCE2 in the article. The book is also the used literature for PRINCE2 Foundation and PRINCE2 Practitioner candidates.

Project Management Institute. 2017. Project Management: A guide to the Project Management Body of Knowledge (PMBOK guide) 6th Edition. Pennsylvania, USA: Project Management Institute, Inc. The PMBOK Guide is used as a reference throughout the article, especially for comparing the two state-of-the-art management certifications PMP and PRINCE2. The PMBOK Guide is published by the PMI organization and a recognized standard in state-of-the-art project management.

Klas Skogmar. 2015. PRINCE2®, the PMBOK® Guide and ISO 21500:2012. Norwich: AXELOS Limited The article describes the relationship between PRINCE2 and the PMBOK Guide. It also includes the ISO 21500 standard. The article is written by Klas Skogmar, consultant in Arkatay Consulting AB.