Project planning and the performance of information technology projects. Limits and possibilities

Table of Contents

LIST OF TABLES

LIST OF FIGURES

LIST OF APPENDICES

LIST OF ACRONYMS/ABBREVIATIONS

ABSTRACT

CHAPTER ONE: INTRODUCTION
1.1. Background of the Study
1.2. Statement of the Problem
1.3. Research Objective(s)
1.3.1. General Objective
1.3.2. Specific Objectives
1.4. Research Questions
1.5. Hypothesis of the Study
1.6. Scope of the Study
1.7. Limitations of the Study
1.8. Significance of the Study
1.9. Organization of the Study

CHAPTER TWO: LITERATURE REVIEW
2.1. Theoretical Literature
2.1.1. The Essence of Project and its Management
2.1.2. Project Management Body of Knowledge Areas
2.1.3. Project Management Process Groups
2.2. Empirical Literature
2.3. Conceptual Framework

CHAPTER THREE: RESEARCH METHODS
3.1. Introduction
3.2. Operational Definition of Variables
3.2.1. Dependent Variable
3.2.2. Independent Variable
3.3. Research Design
3.4. Target Population
3.5. Data Type and Source
3.6. Data Collection Techniques and Procedure
3.6.1. Data Collection Methods
3.6.2. Data Collection Procedures
3.7. Data Processing and Analysis
3.7.1. Data Processing
3.7.2. Data Analysis
3.8. Model Specification
3.9. Reliability and Validity
3.10. Ethical Consideration

CHAPTER FOUR: RESULTS AND DISCUSSIONS
4.1. Introduction
4.2. Demographic Characteristics of Respondents
4.2.1. Classification of Respondents by Gender
4.2.2. Classification of Respondents by Level of Education
4.2.3. Respondents Work Experience
4.3. Reliability Analysis
4.4. Descriptive Analysis
4.4.1. Descriptive Statistics of Project Success Measurement
4.4.2. Descriptive Statistics of Project Planning Processes
4.5. Correlations Analysis
4.6. Regression Analysis
4.6.1. Testing Assumptions of Regression Model
4.6.2. The Role of Project Planning Activities on IT Projects Completion Time
4.6.3. The Role of Project Planning Activities on IT Projects Completion Cost
4.6.4. The Role of Project Planning Activities on IT Projects Quality
4.7. Results Summary

CHAPTER FIVE: CONCLUSIONS AND RECOMMENDATIONS
5.1. Conclusions
5.2. Recommendations
5.3. Future Areas of Research

REFERENCES

APPENDICES
Appendix 1: Questionnaire
Appendix 2: Preliminary Test and Regression Results
Appendix 2.1: Scatter Plot of the Standardized Residuals
Appendix 2.2: Collinearity Diagnostic and Standardized Regression Results of IT Projects Completion Time
Appendix 2.3: Standardized Regression Results of IT Projects Completion Cost
Appendix 2.4: Standardized Regression Results of IT Projects Quality

LIST OF TABLES

Table 4.1: Respondents by Gender

Table 4.2: Classification of Respondents by Level of Education

Table 4.3: Classification of Respondents by Work Experience

Table 4.4: Reliability Statistics

Table 4.5: Survey result on IT Projects Success Measurement Indicators

Table 4.6: Descriptive Statistics of Planning Knowledge Areas

Table 4.7: Correlations between Planning Knowledge Areas and Project Performance

Table 4.8: The Role of Project Planning Activities on IT Projects Completion Time

Table 4.9: ANOVA for IT Projects Completion Time

Table 4.10: The Role of Project Planning Activities on IT Projects Completion Cost

Table 4.11: ANOVA for IT Projects Completion Cost

Table 4.12: The Role of Project Planning Activities on IT Projects Quality

Table 4.13: ANOVA for IT Projects Quality

LIST OF FIGURES

Figure 1: Conceptual framework

Figure 2: Project Success Measurement Indicators in CBE

Figure 3 Performance of Planning Knowledge areas in CBE

LIST OF APPENDICES

Appendix 1: Questionnaire

Appendix 2: Collinearity Diagnostic and Regression Results

LIST OF ACRONYMS/ABBREVIATIONS

CBE - Commercial Bank of Ethiopia

IT - Information Technology

PMI - Project Management Institute

PMO - Program Management Office

SD - Standard Deviation

SPSS - Statistical Packages for Social Sciences

VIF - Variance Inflation Factor

WBS — Work Breakdown Structure

ABSTRACT

The main purpose of the study is to analyze the effect planning activities on the performance of IT projects in CBE. Descriptive research based on survey approach was carried out using primary data collected through self-developed questionnaire. Standardized multiple regression and other statistical methods were employed to test the hypothesis. The study ascertain that IT projects end up within the desired quality in CBE at the expense of extra cost and consuming additional schedule time. Correlation analysis reveal that between IT projects performance and time, cost, risk, human resource, communication, procurement, integration and stakeholders planning knowledge areas are found significantly positive. The study also ascertain that stakeholder; scope; procurement; cost; human resource; integration and risk knowledge areas were found planning problem areas in implementation of IT projects in CBE. The study further confirmed that time; cost; integration; and stakeholders planning activities made a significant contribution to the performance of IT projects in CBE. The study recommends that, in order to improve the performance of IT projects (within cost, time and quality) CBE needs to effectively design and implement time, cost, quality, risk, scope, human resource, communication, integration, procurement and stakeholders planning activities.

Key words: Project Planning Activities, and Project Performance.

CHAPTER ONE: INTRODUCTION

1.1. Background of the Study

Projects play a major role in the economic development of a country. They are the building blocks for generating additional capital and for ensuring a flow of goods and services. The objective of the project management is to realize the planned project objectives and it project management has different phases and processes within it. Each phase contains rigorous and comprehensive activities to be performed (Tesfaye, Lemma, Berhan & Beshah, 2016).

Traditional wisdom is that planning and analysis are very important and the more there is planning in a project, the more successful the project will be (Wang & Gibson, 2008). Serrador (2013) in his literature reported the link between planning and project success and tried to affirm its importance and concluded that project planning is widely thought to be an important contributor to project success. Hence, the need for planning in project development and delivery is crucial because of the complex nature of resources, processes, activities and parties that are involved (Godwin, 2010).

The success of any project is measured by its completion time, within the budget cost and meets the planned performance based on the initial plan. Therefore, planning has an important role on the project success. In order to accomplish all these projects successfully, each of them have to undergo different phases where the level of efforts and impacts to the project success depends on the phases (Tesfaye et.al, 2016).

Previous researches have indicated inadequate project planning and analysis is one of the reasons for project failure (Thomas, Jacques, Adams, & Kihneman-Woote, 2008). Moreover researches discovered that there is positive correlation between project planning effort and project success (Dvir, Raz & Shenhar, 2003). According to their study findings there is a high correlation between the planning efforts and overall project success. Although their studies have considered many factors that influence project outcomes, but planning was mentioned as an important factor for project success.

Despite the fact that, most projects have a significant contribution to the economy, the success of the project still remains generally low in a developing country. The success and failure of projects are very serious for the so-called capital-starved countries. Therefore, maximum effort in project planning is required and a thorough attention has to be given for planning activities in order to have successful projects (Tesfaye et.al, 2016).

Commercial Bank of Ethiopia (CBE) is a pioneer to introduce technology to the Ethiopian banking industry. In general, CBE is the leading bank in Ethiopia and serves as the major source of finance to the national development effect.

The need for employment of information technology to facilitate the banking operation and assist in decision-making process was recognized by the CBE quite early. Accordingly, the attempt to take initiatives consistent with the development in information technology and local conditions were taken for implementing application and communication architectures.

In this regards, CBE developed the first Information Technology (IT) short and long-term roadmap document in 2006. The IT Short-term strategies that focused to pave the way to the long-term IT Strategy of the Bank were fully implemented. Therefore, Information system strategic roadmap is designed to deliver the required IT support and realization of the CBE’s vision ‘to be world class commercial bank’ through time with a clearly defined roadmap subject for periodic revision.

According to the annual performance report of CBE, 2017, IT infrastructure project implementation, Internet Banking, Card Banking System Implantation, Competency Gap Analysis, Performance Management System (PMS) are some of the projects which are registered under success and started operation (CBE, 2017).

Hence, the purpose of this study is to analyze the effect of project planning processes on the performance of IT projects from project management body of knowledge point of view in CBE.

1.2. Statement of the Problem

Historically the understanding of project success criteria has evolved from triple constraint concept, known as the iron triangle (time, cost and quality) to something that encompasses many additional success criteria such as quality, stakeholder satisfaction, and knowledge management. Although earlier studies have considered many factors that influence project outcome, planning was mentioned as an important factor for project success. Previous researches have indicated poor project planning is one of the reasons for project failure (Dvir et al., 2003).

Projects are said to be successful if the iron triangle criteria are met: delivered on time, within budget and meeting the predetermined quality measures (Atkinson, 1999 cited in Tesfaye et.al, 2016). If the project takes longer time it requires additional resources, and budgets and this increases labor, material, machinery and equipment cost. This affects the budget of other projects and in general, it affects the economy of the country.

Similarly, due to delay in project implementation the people and the economy have to wait for the provision of public and services facility longer than necessary. Thus failure of project limits the growth of the economy because the output provided by infrastructure, construction, manufacturing, IT projects serve as input for many other sectors of the economy (Tesfaye et.al, 2016).

Previous research works by (Dvir et al., 2003; and Adeyemi & Idoko, 2008) and others have indicated poor project planning to be one of the reason for project failure in developing countries. Thus, failure of project limits the growth of the economy because the output provided by infrastructure, construction, manufacturing, IT projects serve as input for many other sectors of the economy (Tesfaye et.al, 2016).

Therefore, improvement in project planning knowledge areas is required to improve the performance of project outcome. In addition, identifying the main problem areas in project planning activities and taking appropriate action is required.

As far as the previous research in the area is concerned, little research has been done in Ethiopia. In this regard, the previous researches in Ethiopia such as Tesfaye et.al, 2016 conducted based on nine project planning activities (time, cost, risk, scope, quality, human resource, communication, procurement and integration) and did not considered stakeholder management activity of planning process as it is identified in the fifth edition of a guide to the project management body of knowledge (PMI, 2013).

In addition, Tesfaye et.al, 2016 conducted a study by focusing on different construction projects performed in Ethiopia and to the knowledge of the researcher, no research has been done specific to information technology projects in the Ethiopian banking industry. Therefore, this study intends to examine the role of planning process activities (time; cost; risk; scope; quality; human resource; communication; procurement; integration; and stakeholder management) on the performance of IT projects from the project management body of knowledge point of view in CBE.

1.3. Research Objective(s)

The study has the following general and specific objectives.

1.3.1. General Objective

The broad objective of the study was to analyze the effect of project planning processes on performance of IT projects in CBE.

1.3.2. Specific Objectives

1. To examine the impact of effective planning processes on quality of IT projects in CBE.
2. To analyze the impact of effective planning processes on IT project completion time in CBE.
3. To investigate the impact of effective planning processes on IT project completion cost in CBE.

1.4. Research Questions

This study aimed to fill the gap by answering the following research questions:

1. What is the role of planning processes on quality of IT projects in CBE?
2. What is the role of planning processes on IT project completion time in CBE?
3. What is the role of effective planning processes on IT project completion cost in CBE?

1.5. Hypothesis of the Study

To achieve the specific objectives, the study proposed the following research hypothesis based on the existing theories and referring to past empirical studies for later testing.

Ho1: There is a significant effect of project planning processes on IT projects quality in CBE.

Ho2: There is a significant effect of project planning processes on IT projects completion time in CBE.

Ho3: There is a significant effect of project planning processes on IT projects completion costs in CBE.

1.6. Scope of the Study

According to the annual performance report, different projects such as construction and IT were some of the projects which are registered under success in CBE (CBE, 2017). However, this study limited its scope to analyzing the role of planning processes on performance of IT projects. In addition, the success of a project is measured by a variety of factors. However, this study is limited to the success factors identified in the iron triangle approach (cost, time and quality). Finally the study limited is geographical scope to the head office of the bank.

1.7. Limitations of the Study

The study focused on specific IT projects and IT project management professionals in CBE. But there are other projects such as construction implemented in CBE. Therefore, the study lacks to address all projects implemented in CBE. In addition, project performances are also measured by other parameters such as users and stakeholders satisfaction which were not addressed by this study. Consequently, the study lacks the effect of planning activities on those other project performance indicators to further explain the findings.

1.8. Significance of the Study

The study is helpful by contributing to a better understanding and knowledge on the role of effective planning on the performance of projects in general and on IT projects in particular. Scholars and researchers might use the study to provide a framework for strengthening existing project planning principles and also might use its’ findings as a reference.

1.9. Organization of the Study

This study is organized into five chapters. Chapter one presents the introduction in which brief introduction of the topic, research problem, research questions, objective of study, and scope and limitations of the study are addressed. Chapter two discusses literature review in which previous theories and empirical findings regarding core banking implementation are explained. Chapter three explains the research methods the study employed. Chapter four briefly explains the results and discussions of the study. The final chapter presents the conclusions and recommendations of the study based on the findings.

CHAPTER TWO: LITERATURE REVIEW

2.1. Theoretical Literature

2.1.1. The Essence of Project and its Management

A project is a temporary endeavor undertaken to create a unique product, service, or result. The temporary nature of projects indicates that a project has a definite beginning and end. The end is reached when the project’s objectives have been achieved or when the project is terminated because its objectives will not or cannot be met, or when the need for the project no longer exists. A project may also be terminated if the client (customer, sponsor, or champion) wishes to terminate the project (PMI, 2013).

Different definitions were given for project management. According to PMI (2000) definition, project management is “the application of knowledge, skills, tools and techniques to project activities to meet the project requirements.” Project managers must not only strive to meet specific scope, time, cost, and quality requirements of projects, they must also facilitate the entire process to meet the needs and expectations of the people involved in or affected by project activities (Kathy, 2015). According to Kathy (2015) project management process groups include: initiating, planning, executing, monitoring and controlling, and closing activities.

The planning processes include devising and maintaining a workable scheme to ensure that the project addresses the organization’s needs. There normally is no single “project plan.” There are several plans, such as the scope management plan, schedule management plan, cost management plan, pro management plan, and so on, defining each knowledge area as it relates to the project at that point (Kathy, 2015).

2.1.2. Project Management Body of Knowledge Areas

A Knowledge Area represents a complete set of concepts, terms, and activities that make up a professional field, project management field, or area of specialization. In its fifth edition in 2013, PMI identified to ten project management knowledge areas. These ten knowledge areas are used on most projects most of the time. Project teams should utilize these ten knowledge areas and other knowledge areas, as appropriate, for their specific project (PMI, 2013).

The Knowledge Areas are: Project Integration Management, Project Scope Management, Project Time Management, Project Quality Management, Project Human Resource Management, Project Communications Management, Project Risk Management, Project Procurement Management and Project Stakeholder Management. For the ten knowledge areas a total of 47 processes are identified in Project Management body of Knowledge (PMI, 2013).

2.1.2.1. Project Integration Management

In the project management context, integration includes characteristics of unification, consolidation, communication, and integrative actions that are crucial to controlled project execution through completion, successfully managing stakeholder expectations, and meeting requirements (PMI, 2013). Project Integration Management includes making choices about resource allocation, making trade-offs among competing objectives and alternatives, and managing the interdependencies among the project management Knowledge Areas (PMI, 2013). According to PMI (2013) Project Integration Management processes includes: project character development, project management plan development, direct and manage project work, monitor and control project work, perform integrated change and close project or phase.

2.1.2.2. Project Scope Management

Project Scope Management includes the processes required to ensure that the project includes all the work required, and only the work required, to complete the project successfully. Managing the project scope is primarily concerned with defining and controlling what is and is not included in the project (PMI, 2013).

2.1.2.3. Project Time Management

Project time management includes the processes required to manage the timely completion of the project. Plan Schedule Management is the process of establishing the policies, procedures, and documentation for planning, developing, managing, executing, and controlling the project schedule. The key benefit of this process is that it provides guidance and direction on how the project schedule will be managed throughout the project. The output of this process is schedule management plan (PMI, 2013).

2.1.2.4. Project Cost Management

Project Cost Management includes the processes involved in planning, estimating, budgeting, financing, funding, managing, and controlling costs so that the project can be completed within the approved budget. Plan Cost Management is the process that establishes the policies, procedures, and documentation for planning, managing, expending, and controlling project costs. The key benefit of this process is that it provides guidance and direction on how the project costs will be managed throughout the project. The output of this process is a cost management plan (PMI, 2013).

2.1.2.5. Project Quality Management

Project Quality Management includes the processes and activities of the performing organization that determine quality policies, objectives, and responsibilities so that the project will satisfy the needs for which it was undertaken. Project Quality Management uses policies and procedures to implement, within the project’s context, the organization’s quality management system and, as appropriate, it supports continuous process improvement activities as undertaken on behalf of the performing organization. Project Quality Management works to ensure that the project requirements, including product requirements, are met and validated (PMI, 2013).

2.1.2.6. Project Human Resource Management

Project Human Resource Management includes the processes that organize, manage, and lead the project team. The project team is comprised of the people with assigned roles and responsibilities for completing the project. Project team members may have varied skill sets, may be assigned full or part-time, and may be added or removed from the team as the project progresses. Project team members may also be referred to as the project’s staff. Although specific roles and responsibilities for the project team members are assigned, the involvement of all team members in project planning and decision making is beneficial. Participation of team members during planning adds their expertise to the process and strengthens their commitment to the project (PMI, 2013).

2.1.2.7. Project Communications Management

Project Communications Management includes the processes that are required to ensure timely and appropriate planning, collection, creation, distribution, storage, retrieval, management, control, monitoring, and the ultimate disposition of project information. Project managers spend most of their time communicating with team members and other project stakeholders, whether they are internal (at all organizational levels) or external to the organization. Effective communication creates a bridge between diverse stakeholders who may have different cultural and organizational backgrounds, different levels of expertise, and different perspectives and interests, which impact or have an influence upon the project execution or outcome (PMI, 2013).

2.1.2.8. Project Risk Management

Project Risk Management includes the processes of conducting risk management planning, identification, analysis, response planning, and controlling risk on a project. The objectives of project risk management are to increase the likelihood and impact of positive events, and decrease the likelihood and impact of negative events in the project (PMI, 2013).

2.1.2.9. Project Procurement Management

Project Procurement Management includes the processes necessary to purchase or acquire products, services, or results needed from outside the project team. The organization can be either the buyer or seller of the products, services, or results of a project. Project Procurement Management includes the contract management and change control processes required to develop and administer contracts or purchase orders issued by authorized project team members. Project Procurement Management also includes controlling any contract issued by an outside organization (the buyer) that is acquiring deliverables from the project from the performing organization (the seller), and administering contractual obligations placed on the project team by the contract (PMI, 2013).

2.1.2.10. Project Stakeholder Management

Project Stakeholder Management includes the processes required to identify the people, groups, or organizations that could impact or be impacted by the project, to analyze stakeholder expectations and their impact on the project, and to develop appropriate management strategies for effectively engaging stakeholders in project decisions and execution. Stakeholder management also focuses on continuous communication with stakeholders to understand their needs and expectations, addressing issues as they occur, managing conflicting interests and fostering appropriate stakeholder engagement in project decisions and activities. Stakeholder satisfaction should be managed as a key project objective (PMI, 2013).

2.1.3. Project Management Process Groups

As projects are separated into distinct phases or subcomponents, such as concept development, feasibility study, design, prototype, build, or test, etc., all of the Process Groups would normally be repeated for each phase or subcomponent (PMI, 2013). The project management process groups as identified by PMI (2013) include: Initiating process group, planning process group, executing process group and closing process group. Since the focus of this study is on the planning phase of the project management, the following section describes the planning process group in detail:

2.1.4. Planning Process Group

The planning process group consists of those processes performed to establish the total scope of the effort, define and refine the objectives, and develop the course of action required to attain those objectives. The Planning processes develop the project management plan and the project documents that will be used to carry out the project. The complex nature of project management may require the use of repeated feedback loops for additional analysis (PMI, 2013).

As more project information or characteristics are gathered and understood, additional planning will likely be required. Significant changes occurring throughout the project life cycle trigger a need to revisit one or more of the planning processes and, possibly, some of the initiating processes. This progressive detailing of the project management plan is called progressive elaboration, indicating that planning and documentation are iterative and ongoing activities (PMI, 2013).

The key benefit of this process group is to delineate the strategy and tactics as well as the course of action or a path to successfully complete the project or phase. When the Planning Process group is well managed, it is much easier to get stakeholder buy-in and engagement. These processes describe how this will be done, resulting in the desired objectives (PMI, 2013). The project management plan and project documents developed as outputs from the planning process group will explore all aspects of the scope, time, costs, quality, communications, human resources, risks, procurements, and stakeholder management (PMI, 2013). The planning process group activities as identified by PMI in its guide to the project management body of knowledge described in the following sections of the paper.

2.1.4.1. Project Management Plan Development

Project management plan development is the process of defining, preparing, and coordinating all subsidiary plans and integrating them into a comprehensive project management plan. The project management plan defines how the project is executed, monitored and controlled, and closed. The project management plan’s content varies depending upon the application area and complexity of the project. It is developed through a series of integrated processes extending through project closure. The key benefit of this process is a central document that defines the basis of all project work. The outputs o this process is project management (PMI, 2013).

2.1.4.2. Scope Management Plan

Scope management plan is the process of creating a scope management plan that documents how the project scope will be defined, validated, and controlled. The key benefit of this process is that it provides guidance and direction on how scope will be managed throughout the project. The outputs of this process are: scope management plan and requirements management plan (PMI, 2013).

2.1.4.2.1. Collect Requirements

Collect Requirements is the process of determining, documenting, and managing stakeholder needs and requirements to meet project objectives. The key benefit of this process is that it provides the basis for defining and managing the project scope including product scope. The outputs of this process are: Requirements documentation and requirements traceability matrix (PMI, 2013).

2.1.4.2.2. Scope Definition

Scope definition is the process of developing a detailed description of the project and product. The key benefit of this process is that it describes the project, service, or result boundaries by defining which of the requirements collected will be included in and excluded from the project scope. The outputs of this process includes: project scope statement and project documents update (PMI, 2013).

2.1.4.2.3. Create WBS

Create work break down structure (WBS) is the process of subdividing project deliverables and project work into smaller, more manageable components. The key benefit of this process is that it provides a structured vision of what has to be delivered. The outputs of this process are: Scope baseline and Project documents updates (PMI, 2013).

2.1.4.3. Schedule Management Plan

Schedule Management plan is the process of establishing the policies, procedures, and documentation for planning, developing, managing, executing, and controlling the project schedule. In addition, it defines how schedule contingencies will be reported and assessed. It is a component of the project management plan and it may be formal or informal, highly detailed or broadly framed, based upon the needs of the project, and includes appropriate control thresholds. The key benefit of this process is that it provides guidance and direction on how the project schedule will be managed throughout the project. The output of this process is schedule management plan (PMI, 2013).

2.1.4.3.1. Define Activities

Activity Definition is the process of identifying and documenting the specific actions to be performed to produce the project deliverables. The key benefit of this process is to break down work packages into activities that provide a basis for estimating, scheduling, executing, monitoring, and controlling the project work. The outputs of this process are: Activity list, activity attributes and milestone lists (PMI, 2013).

2.1.4.3.2. Sequence Activities

Activity sequencing is the process of identifying and documenting relationships among the project activities. The key benefit of this process is that it defines the logical sequence of work to obtain the greatest efficiency given all project constraints. The outputs of this process are: project schedule network diagram and project documents updates (PMI, 2013).

2.1.4.3.3. Estimate Activity Resources

Activity Resources Estimation is the process of estimating the type and quantities of material, human resources, equipment, or supplies required to perform each activity. The key benefit of this process is that it identifies the type, quantity, and characteristics of resources required to complete the activity which allows more accurate cost and duration estimates. The outputs of this process are: Activity resource requirements, resource breakdown structure and project documents updates (PMI, 2013).

2.1.4.3.4. Estimate Activity Durations

Activity duration Estimation is the process of estimating the number of work periods needed to complete individual activities with estimated resources. The key benefit of this process is that it provides the amount of time each activity will take to complete, which is a major input into the Develop Schedule process. The outputs of this process are Activity duration estimates and project documents updates (PMI, 2013). Estimating activity durations uses information on activity scope of work, required resource types, estimated resource quantities, and resource calendars. The inputs of the estimates of activity duration originate from the person or group on the project team who is most familiar with the nature of the work in the specific activity. The duration estimate is progressively elaborated, and the process considers the quality and availability of the input data. For example, as more detailed and precise data is available about the project engineering and design work, the accuracy of the duration estimates improves. Thus, the duration estimate can be assumed to be progressively more accurate and of better quality (PMI, 2013).

2.1.4.3.5. Develop Schedule

Schedule development is the process of analyzing activity sequences, durations, resource requirements, and schedule constraints to create the project schedule model. The key benefit of this process is that by entering schedule activities, durations, resources, resource availabilities, and logical relationships into the scheduling tool, it generates a schedule model with planned dates for completing project activities. The outputs of this process are: Schedule baseline, project schedule, schedule data, project calendars, project management plan updates and project documents updates (PMI, 2013). Developing an acceptable project schedule is often an iterative process. The schedule model is used to determine the planned start and finish dates for project activities and milestones based on the accuracy of the inputs. Schedule development can require the review and revision of duration estimates and resource estimates to create the project schedule model to establish an approved project schedule that can serve as a baseline to track progress. Once the activity start and finish dates have been determined, it is common to have project staff assigned to the activities review their assigned activities and confirm that the start and finish dates present no conflict with resource calendars or assigned activities in other projects or tasks and thus are still valid (PMI, 2013).

2.1.4.4. Cost Management Plan

Cost Management plan is the process that establishes the policies, procedures, and documentation for planning, managing, expending, and controlling project costs. The key benefit of this process is that it provides guidance and direction on how the project costs will be managed throughout the project. The inputs and outputs of this process is cost management plan (PMI, 2013).

2.1.4.4.1. Estimate Costs

Estimate Costs is the process of developing an approximation of the monetary resources needed to complete project activities. The key benefit of this process is that it determines the amount of cost required to complete project work. The outputs of this process are: Activity cost estimates; basis of estimates and project documents updates (PMI, 2013).

2.1.4.4.2. Determine Budget

Determine budget is the process of aggregating the estimated costs of individual activities or work packages to establish an authorized cost baseline. The key benefit of this process is that it determines the cost baseline against which project performance can be monitored and controlled. The outputs of this process are: Cost baseline, project funding requirement and project documents updates (PMI, 2013).

2.1.4.5. Quality Management Plan

Quality Management plan is the process of identifying quality requirements and/or standards for the project and its deliverables, and documenting how the project will demonstrate compliance with relevant quality requirements. The key benefit of this process is that it provides guidance and direction on how quality will be managed and validated throughout the project. The outputs of this process are: Quality management plan, process improvement plan, quality metrics, quality checklists, project documents updates (PMI, 2013).

2.1.4.6. Human Resource Management Plan

Human Resource Management plan is the process of identifying and documenting project roles, responsibilities, and required skills, reporting relationships, and creating a staffing management plan. The key benefit of this process is that it establishes project roles and responsibilities, project organization charts, and the staffing management plan including the timetable for staff acquisition and release. The output of this process is human resource management plan (PMI, 2013).

2.1.4.7. Communications Management Plan

Communications Management plan is the process of developing an appropriate approach and plan for project communications based on stakeholder’s information needs and requirements, and available organizational assets. The key benefit of this process is that it identifies and documents the approach to communicate most effectively and efficiently with stakeholders. The outputs of this process are: a communications management plan and project document updates (PMI, 2013).

2.1.4.8. Risk Management Plan

Risk Management plan is the process of defining how to conduct risk management activities for a project. The key benefit of this process is that it ensures that the degree, type, and visibility of risk management are commensurate with both the risks and the importance of the project to the organization. The output of this process is risk management plan (PMI, 2013).

2.1.4.8.1. Identify Risks

Identify risks is the process of determining which risks may affect the project and documenting their characteristics. The key benefit of this process is the documentation of existing risks and the knowledge and ability it provides to the project team to anticipate events. The output of this process is risk register (PMI, 2013).

2.1.4.8.2. Perform Qualitative Risk Analysis

Perform qualitative Risk Analysis is the process of prioritizing risks for further analysis or action by assessing and combining their probability of occurrence and impact. The key benefit of this process is that it enables project managers to reduce the level of uncertainty and to focus on high-priority risks. The output of this process project documents updates (PMI, 2013).

2.1.4.8.3. Perform Quantitative Risk Analysis

Perform Quantitative Risk Analysis is the process of numerically analyzing the effect of identified risks on overall project objectives. The key benefit of this process is that it produces quantitative risk information to support decision making in order to reduce project uncertainty. The output of this process is Project documents updates (PMI, 2013).

2.1.4.8.4. Plan Risk Responses

A plan risk response is the process of developing options and actions to enhance opportunities and to reduce threats to project objectives. The key benefit of this process is that it addresses the risks by their priority, inserting resources and activities into the budget, schedule and project management plan as needed. The outputs of this process are: Project management plan updates and project documents updates (PMI, 2013).

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