pm pmp exam preparation study guideglossary

GLOSSARY

Factors that for planning purposes will be considered to be true, real, orcertain (PMBOK® 4.1.1.5).

Assumptions

The transfer of a right, a contractual obligation, or property from oneparty to another.

Assignment

All items of value owned by a company.Assets

Characteristics of an individual concerned with task accomplishment.Assertive-Directing

A strong desire or ambition, as for advancement or honor.Aspiration

The process of settlement of a dispute between two parties by animpartial third party.

Arbitration

Characteristics of an individual concerned with planning and is fair andprincipled.

Analytic-Autonomizing

The power to simplify what is either complex or complicated.Analytical Skills

Also called top-down estimating; using the actual duration of a previous,similar activity as the basis for estimating the duration of a future activity(PMBOK® 6.3.2.2 and 7.2.2.1).

Analogous Estimating

A change to a contract by authority. Note: Either party to a contract canamend or change the contract. Usually all changes must be signed byboth parties.

Amendment

Characteristic of an individual concerned with the protection, growth, andwelfare of others.

Altruistic-Nurturing

Synonymous with contract.Agreement

Law that allows one party, called the principal, to delegate authority toanother party, called an agent, to act in all matters relating to thebusiness of the principal.

Agency Law

Verifying and documenting project results to formalize acceptance of theproduct of the project by the sponsor, client, or customer (PMBOK® 10.4).

Administrative Closure

The real, measurable, out-of-pocket costs recoverable as compensationfor actual loss.

Actual Damages

This term has been replaced with the term actual cost.Actual Cost of WorkPerformed (ACWP)

Total costs incurred that must relate to whatever cost was budgetedwithin the planned value and earned value in accomplishing work duringa given time period. (PMBOK® p. 197).

Actual Cost (AC)

A task (work element) performed over a period of time; a specific pieceof defined work from the WBS.

Activity

Assets = Liabilities + Owners’ EquityAccounting Equation

Agreement to the terms offered in a proposal or contract; the taking orreceiving of a contract deliverable.

Acceptance

Recognition of the fact that it is just as difficult for people to manageagreement as it is to manage conflict.

Abilene Paradox

DefinitionTerm

Glossary GL-1 © Copyright IBM Corp. 2002Course materials may not be reproduced in whole or in part

without the prior written permission of IBM.

A combination of producers of any product joined together to control itsproduction, sale, and price so as to obtain a monopoly and restrictcompetition in any particular industry or commodity.

Cartel

A business entity with a special relationship to a principal, making it easierto jointly address a business opportunity.

Business Partner

See estimate.Budget Estimate

This term is replaced with the team planned value.Budgeted Cost of WorkScheduled (BCWS)

This term is replaced with the team earned value.Budgeted Cost of WorkPerformed (BCWP)

The estimated total cost of the project when done.Budget at Completion (BAC)

Failure to perform a contractual obligation without legal excuse.Breach

Estimating the cost of individual work items and then summarizing orrolling up the individual estimates to get a project total (PMBOK® 7.2.2.3).

Bottom-Up Estimating

A monetary guarantee to cover losses suffered for specified reasons, anobligation, or constraint. See also bid bond; performance bond.

Bond

A monetary guarantee that the bidder, if awarded a contract, will in factexecute (sign) it. Note: A bid bond expires automatically at the time thecontract is signed by the parties or if the contract is not awarded.

Bid Bond

The estimated cost of a project based on the currently known factsregarding scope, schedule, and expectations. See time-and-materials.

Best Estimate

A statement in a proposal or contract that implies that the buyer or sellerwill put forth its best skills and dedication with the intent of meeting anobligation.

Best Efforts

Usually used with a modifier (e.g.., cost baseline, schedule baseline,performance measurement baseline).

Benefit-Cost Analysis

Anything accepted as true; a creed, doctrine, or tenant; an opinion,expectation, or judgment.

Beliefs

A version of a plan, with its associated estimate, that has been acceptedas part of the contract, and is now subject to change

Baseline Plan

The original plan (for a project, a work package or an activity) plus orminus approved changes. Usually used with a modifier (e.g.., costbaseline, schedule baseline, performance measurement baseline).(PMBOK® p 198)

Baseline

A graphic display of schedule -related information. Shows activity startand end dates and expected durations but do not usually showdependencies (PMBOK® 6.4.3.1).

Bar Charts (Gantt Charts)

The state of being insolvent; failure or inability to pay just debts orobligations.

Bankruptcy

The act of granting or assigning a contract from a buyer to a seller.Phase 2 of the contract management process.

Award

The only people who can make, accept, reject, defer, or negotiatechange.

Authorized Representatives

One’s disposition or opinion; position or stand; point of view.Attitudes

DefinitionTerm

Glossary



Component of a statement of risk; a single phrase or sentence that brieflydescribes the key possible outcomes of the current conditions.

Consequence

Is a difference in opinion between two or more persons or groups thatcauses each to attempt to influence a situation affecting all partiesconcerned.

Conflict

Component of a statement of risk; a single phrase or sentence that brieflydescribes the key circumstances or situations causing the doubt, concern,anxiety, or uncertainty.

Condition

A person who creates or develops.Composer

Any subpart of an intermediate, higher-level deliverable with the attributesof a deliverable.

Component Deliverable

Persons or legal entities possessing legal capacity and authority to enterinto a contract.

Competent Parties

Sum of the information requirements of the project stakeholders(PMBOK® 10.1.1.1).

CommunicationRequirements

Determining the information and communication needs of stakeholders: who need what information, when they need it, and how it will be given tothem (PMBOK® 10.1).

CommunicationPlanning

Document that provides a collection and filing structure of methods usedto gather and store information; a distribution structure to detail to whominformation will flow and methods used to distribute information; adescription of information to be distributed; production schedules for eachtype of communication; methods to access information betweenscheduled communication; and a method to update and refine theCommunications Management Plan as the project progresses anddevelops (PMBOK® 10.1.3.1).

CommunicationManagement Plan

Communication refers to the transfer of symbols to create sharedmeaning in the mind of the sender and receiver.

Communication

Exchange of information (PMBOK® 2.4.2).Communicating

Sound and prudent judgment.Common Sense

The body of those principles and rules of action that derive their authorityfrom tradition, usage, custom, and previous judicial decisions.

Common Law

The act or condition of sticking together; blending or merging.Cohesion

Making or becoming easier to understand.Clarifying

The body of law created by acts of legislatures and concerned with civilor private rights and remedies.

Civil Law

A formal, written request by a buyer directing the seller to make changesaccording to the provisions of the contract documents.

Change Order

Procedures used to manage and control the baseline.Change Management

The formal, documented procedure that defines how change will bemanaged.

Change Control System

People responsible for approving, rejecting, or deferring changerequests.

Change Control Board DefinitionTerm

Glossary



Performing the planned risk response (PMBOK® 11.6.3.2).Corrective Action

The right to literary property, giving authors, composers, and othercreators the sole right to reproduce and distribute their work for a limitedperiod of time.

Copyright

Is discovery, where you narrow down or weed out thoughts, data, etc.,produced during the diverging stage as you head towards reaching asingle conclusion. Judgmental and critical thinking are necessaryduring this stage.

Convergence

Clarification and mutual agreement on the structure and requirements ofthe contract prior to the signing of the contract (PMBOK® 12.4.2.1).

Contract Negotiation

The process of planning, forming, and administering an agreement to buyand sell goods and services from one party to another.

Contract Management

A model law developed in the United States to standardize commercialcontracting among the states.

Contract Law (UniformCommercial Code [UCC])

Completion and settlement of the contract, including resolution of alloutstanding items (PMBOK® 12.6).

Contract Closeout

The power that the principal confers on the agent to act on his or herbehalf to enter into a contract.

Contract Authority

Process of ensuring that the seller’s performance meets contractualrequirements (PMBOK® 12.5).

Contract Administration

An agreement that establishes an enforceable legal relationship betweentwo parties; a mutual exchange of promises. Synonymous withagreement. The elements of a contract are agreement(offer/acceptance), competent parties, mutual consideration, and legalpurpose.

Contract

A separately planned quantity used to allow for future situations which mybe planned for only in part (sometimes called “known unknowns).Contingency reserves may involve cost, schedule, or both. Contingencyreserves are intended to reduce the impact of missing cost or scheduleobjectives. Contingency reserves are normally included in the project’scost and schedule baselines. (PMBOK® Glossary 160)

Contingency Reserve

Defining action steps to be taken if an identified risk event should occur .Contingency Planning

Risk mitigation strategy in which funds are held in a separate account forfuture use; based on a percentage of the overall cost of the project.

Contingency

Risk mitigation strategy in which tasks are added to the WBS; the tasksare estimated, scheduled, costed, and priced.

Containment

Factors that will limit the project management team’s options (PMBOK® 4.1.1.4).

Constraints

Something of value.Consideration

Damages that do not flow directly and immediately from the act of aparty, but only from some of the consequences or results of the act.Example: The client's point-of-sale system is down for four hours due toa software problem. As a result, the client claims to have lost hundredsof thousands of dollars due to lost sales.

Consequential Damages

DefinitionTerm

Glossary



The passing of judgment on an issue under consideration. Theact of reaching a conclusion or making up one's mind.

Decision

Compensation recoverable for a wrong or an injury. See also actualdamages; consequential damages; liquidated damages.

Damages

Individual or organization who will use the project product (PMBOK® 2.2).Customer

Calculates a single, deterministic early and late start and finish date foreach activity based on specified, sequential network logic and a singleduration estimate. Float is calculated to determine which activities havethe least scheduling flexibility (PMBOK® 6.4.2.1).

Critical Path Method (CPM)

Any approach using network parameters to determine the critical path.Critical Path Analysis

In a project network diagram, the series of activities that determines theearliest completion of the project. The critical path will generally changefrom time to time as activities are completed ahead of or behindschedule. The critical path is usually defined as those activities with afloat less than or equal to a specified value, often zero.

Critical Path

Decrease total project duration after analyzing alternatives to determinehow to get the maximum duration compression for the least cost.

Crashing

(1) Any difference between the estimated cost of an activity and theactual cost of that activity. (2) In earned value, BCWP less ACWP.

Cost Variance (CV)

A type of contract in which the buyer reimburses the seller for the seller’sallowable costs (allowable costs are defined by the contract), and theseller earns its profit if it meets defined performance criteria.

Cost-Plus-Incentive Fee(CPIF) Contract

A type of contract in which the buyer reimburses the seller for the seller’sallowable costs (allowable costs are defined by the contract) plus a fixedamount of profit (fee).

Cost-Plus-Fixed Fee (CPFF)Contract

A type of contract in which the seller gets reimbursed for costs ofproducing the item and gets paid a fee for winning the contract.

Cost-Plus-Award Fee(CPAF)

A type of contract in which the seller gets reimbursed for the cost ofproducing the item and also gets a fee calculated as a percentage ofcost. Not permitted in contracts with the federal government.

Cost-Plus-a-Percentage-of-Cost (CPPC)

The ratio of budgeted costs to actual costs (BCWP/ACWP). CPI is oftenused to predict the magnitude of a possible cost overrun using thefollowing formula: original cost estimate/CPI = projected cost atcompletion. See also earned value.

Cost Performance Index(CPI)

The costs incurred to ensure quality. The cost of quality includes qualityplanning, quality control, quality assurance, and rework.

Cost of Quality

Estimating the cost of the resources needed to complete projectactivities.

Cost Estimating

Controlling changes to the project budget.Cost Control

Allocating the cost estimates to individual project components.Cost Budgeting

Time-phased budget used to measure and monitor cost performance onthe project (PMBOK® 7.3.3.1).

Cost Baseline

The expenditure of funds that result directly from production products andestablishing an infrastructure to provide services. A (direct) cost can betraced to the finished product or service.

Cost (or direct cost)

DefinitionTerm

Glossary



The number of labor units required to complete an activity or otherproject element. Usually expressed as staff hours, staff days or staffweeks. Should not be confused with duration.

Effort

Process of training and developing knowledge, skills, and character byformal schooling.

Education

See definition 1 under earned value.Earned Value Analysis

The physical work accomplished plus the authorized budget for this work.The sum of the approved cost estimates for activities completed during agiven period. Previously called budgeted cost of work performed(BCWP) for and activity or group of activities. (PMBOK® p. 201).

Earned Value (EV)

In the critical path method, the earliest possible point in time on which theuncompleted portions of an activity (or the project) can start, based onthe network logic and any schedule constraints; early start dates canchange as the project progresses and changes are made to the projectplan.

Early Start (ES)

In the critical path method, the earliest possible point in time on which theuncompleted portions of an activity (or the project) can finish based onthe network logic and any schedule constraints; early finish dates canchange as the project progresses and changes are made to the projectplan.

Early Finish (EF)

The number of work periods (not including holidays or other nonworkingperiods) required to complete an activity or other project element; usuallyexpressed as workdays or workweeks; sometimes incorrectly equatedwith elapsed time.

Duration

A formal, written agreement between business functions to establishresponsibilities, obligations, and actions in performing a project.

Document of Understanding

Divergence is exploratory, used to generate a lot of ideas. Creativethinking is necessary during the diverging stage.

Divergence

A method that spreads the cost of a long-lived asset over its entireservice life.

Depreciation

Something necessarily consequent on something else.Dependency

Any measurable, tangible, verifiable outcome, result, or item that must beproduced to complete a project or part of a project; often used morenarrowly in reference to an external deliverable, which is a deliverablethat is subject to approval by the project sponsor or customer.

Deliverable

The seller's invoicing the buyer some period of time after the deliverablehas been completed for the convenience of one or both of the parties.

Delayed Invoicing

The buyer's making payment to the seller some period of time after thedeliverable has been accepted for the convenience of one or both of theparties.

Deferred Payment

A deficiency in something essential to the proper use of a product.Defect

The act of reaching a conclusion or making up one's mindDefault

Process used to develop the PBS/WBS by subdividing the major projectdeliverables into smaller, more manageable components until thedeliverables are defined in sufficient detail to support future projectactivities.

Decomposition

DefinitionTerm

Glossary



Amount of time that an activity can be delayed from its early start withoutdelaying the project end date.

Float

Characteristic of an individual able to meet conflict and opposition flexibly.Flexible-Cohering

A type of contract in which the buyer pays the seller a set amount, asdefined by the contract, and the seller can earn an additional amount if itmeets defined performance criteria.

Fixed-Price-Incentive Fee(FPIF) Contract

See firm-fixed-price contract.Fixed-Price Contract

A type of contract in which the buyer pays the seller a set amount, asdefined by the contract, regardless of the seller’s costs.

Firm-Fixed-Price (FFP)Contract

The character or condition of being finished, complete, and conclusive.Finality of Acceptance

Is communication to a person about his or her behavior.Feedback

Doing activities in parallel that normally would be done in sequence.Fast Tracking

Making it easier to explain difficult ideas.Facilitating Understanding

Making it easier to exchange information.Facilitating Communication

Focusing attention and energy outside oneself.Extraversion

Risks beyond the control or influence of the project team External Risks

The funds a company spends in order to sell services and products.Examples include rent, utilities, depreciation, and so forth.

Expense (also known asindirect costs)

Statements of “not included” for a future system.Exclusions

The expected additional cost needed to complete an activity, a group ofactivities, or the project. Most techniques for forecasting ETC includesome adjustment to the original estimate based on project performanceto date. Also called “estimated to complete.” See also earned value andestimate at completion.

Estimate to Complete (ETC)

The expected total cost of an activity, a group of activities, or the projectwhen the defined scope of work has been completed. Most techniquesfor forecasting EAC include some adjustment of the original costestimate based on project performance to date. Also shown as“estimated at completion.” Often shown as EAC = Actuals-to-date + ETC.See also earned value and estimate to complete.

Estimate at Completion(EAC)

An assessment of the likely quantitative result. Usually applied to projectcosts and durations, an estimate should always include some indicationof accuracy (for example ± x percent). Usually used with a modifier (forexample, preliminary, conceptual, feasibility). Some application areashave specific modifiers that imply particular accuracy ranges (forexample, order-of-magnitude estimate, budget estimate, and definitiveestimate in engineering and construction projects).

Estimate

The deposit of something into the care of a mutually agreed-uponcustodian for delivery to the grantee on some defined set of conditions.

Escrow

Organizing and managing a business undertaking.Entrepreneurial

Behaviors displayed by individual team members sometimes at theexpense of the rest of the team and its objectives.

Emotional Issues: Causes ofSelf-Oriented EmotionalBehavior

Number of calendar days over which the task occurs.Elapsed Time

DefinitionTerm

Glossary



Risks the project team can control or influence .Internal Risks

Characteristic of an extravert; interested and concerned about a widerange of areas rather than being interested only in a few areas.

Interests Have Breadth

A behavioral response to the exercise of power. Influence isachieved through the use of power.

Influence

Compensation for loss or damage.Indemnity

The amount remaining after all revenues are accounted for and all costsand expenses are deducted.

Income (also called profit, netincome, and net profit)

Being part of; being involved.Inclusion

Having no personal reference or connection. Showing no emotion.Impersonal

When behavior produces or contributes to positive outcomes, it isconsidered a strength. When it produces or causes negative outcomes, itis considered a weakness. A weakness in some cases might be anoverdone strength.

Identify your strengths andweaknesses incommunicating with others

Nondelivery of a product or nonpayment of an obligation due as a meansof applying pressure to the receiving party.

Holdback

Groupthink is defined as a mode of thinking in which group members'premature striving for agreement somehow overrides their ability(motivation) to realistically appraise alternative courses of action.

Groupthink

The amount remaining after all revenues are accounted for and all directcosts are deducted, but before all indirect expenses are deducted.

Gross Profit

A grave error, caused by negligence or incompetence, with significantnegative consequences.

Gross Mistake

The country or state law applicable to the contract.Governing Law

A non-overhead-related expense not directly attributable to a singleproject. This account is generally used by administrative and seniormanagement.

General and Administrative

Staff are grouped hierarchically by specialty with each employee havingone clear supervisor; a conventional line organization (PMBOK® 2.3.3). Ina functional organization, each employee has one supervisor. Functionalorganizations still have projects, but the scope of the project is limited tothe boundaries of the organizational unit.

Functional OrganizationalStructure

The amount of time an activity can be delayed without delaying the earlystart of any immediately following activities.

Free Float

An intentional perversion of the truth; a false representation.Fraud

Having common interests or beliefs.Fraternal

Predicting future project status and progress (PMBOK® 10.3).Forecasting

An act of God or irresistible force or inevitable accident that could not beavoided by the exercise of due care. Examples: earthquake, fire, flood,hurricane, and third-party labor dispute/strike.

Force Majeure

Influenced or dependent on previously existing terms or agreements; anintentional failure of a party to enforce, or willingly delay enforcement of,a contract requirement, usually done for an act of immediate or futureconsideration from the other party.

Forbearance

DefinitionTerm

Glossary



A sum stipulated and agreed upon by the parties at the time they enteredthe contract as an estimate of the actual damages the harmed party willsuffer as a result of not meeting an obligation. Note: If a party fails tomeet the specified obligation but pays the liquidated damages, he or shecannot be considered in default of the contract for not meeting thatobligation.

Liquidated Damages

Concerned with the cost of the resources needed to complete projectactivities and the effects of project decisions on the cost of using theproject product (PMBOK® 7).

Life-Cycle Costing

The condition of being responsible for a possible or actual loss.Liability

All debts and moneys owed to others by a company.Liabilities

Support-type activity (for example, vendor or customer liaison) that doesnot readily lend itself to measurement of discrete accomplishment;generally characterized by a uniform rate of activity over a specific periodof time.

Level of Effort

A letter format agreement that authorizes contract performance to startfor a limited scope and time while final negotiations are taking place.Note: Previously known as "letter of intent."

Letter of Authorization

The causes of variances, the reasoning behind the corrective actionschosen, and other types of lessons learned documented so they becomepart of the historical database for the project and other projects of theperforming organization (PMBOK® 4.3.3.3).

Lessons Learned

The underlying purpose of the contract must be allowed by law.Legal Purpose

Involves persuading or influencing other people to set aside fora period of time their individual concerns and to pursue acommon goal that is important for the welfare of the group.

Leadership

A modification of a logical relationship that causes an acceleration ordelay, respectively of the successor task. Any of the dependencies mightrequire specification of a lead or a lag to accurately define therelationship.

Leads and Lags

Establishing direction, aligning people, and motivating and inspiring(PMBOK® 2.4.1).

Leading

In the critical path method, the latest possible point in time that an activitycan begin without delaying a specific milestone (usually the project finishdate).

Late Start (LS)

A defect that existed at the time of acceptance but that could not bediscovered by reasonable inspection or test.

Latent Defect

In the critical path method, the latest possible point in time that an activitycan be completed without delaying a specific milestone (usually theproject finish date).

Late Finish (LF)

Characteristic of a person who prefers to make a decision rather thanpostpone it.

Judging Means Deciding

Persons who gather by looking for possibilities, meanings, andrelationships between and among things.

Intuitive Types

Focusing attention and energy inside oneself.Introversion

DefinitionTerm

Glossary



A method of calculating earnings that does not consider the effect oftaxes on the earnings.

Net Earnings before Taxes(NEBT)

Can be described as the process through which two parties move fromdiverse positions to a point of mutual agreement by means ofdiscussions.

Negotiation

Conferring with others in order to come to terms or reach an agreement(PMBOK® 2.4.3).

Negotiating

Path through the network with low total float.Near-Critical Path

Risk evaluation method using simulation to exercise the frequencydistribution “thousands of times.” The cumulative frequency distributionwill identify the probability of achieving a particular date (task or project)or cost (task or project) within a probability range.

Monte Carlo Technique

A form of market structure in which one or only a few firms dominate thetotal sales of a product or service.

Monopoly

A change to a document or understanding.Modification

A generic agreement containing the base definitions and terms andconditions, which can be used as a base for generation of the finalagreement.

Model Agreement

Identify the scheduled start or completion of major deliverables and keyexternal interfaces (PMBOK® 6.4.3.1).

Milestone Charts

A significant event in the project, usually completion of a majordeliverable.

Milestone

A person who serves as teacher or coach; an advisor.Mentor

The documentation of mutually agreed-to statement of facts, intentions,procedures, and parameters for future actions and matters ofcoordination. Also, the documentation of mutual understanding of anissue by two or more parties.

Memorandum ofUnderstanding

Project manager shares responsibility with functional managers to assignpriorities and direct the work of the people assigned to the project; ablend of functional and projectized structure (PMBOK® 2.3.3).

Matrix OrganizationalStructure

The factor applied to get from cost to final price.Markup

The actual percentage earned on a project.Margin

Producing key results expected by stakeholders (PMBOK® 2.4.1).Managing

A separately planned quantity used to allow for future situations which mybe planned for only in part (sometimes called “known unknowns).Management reserves may involve cost or schedule. Managementreserves are intended to reduce the risk of missing cost or scheduleobjectives. Use of management reserves requires a change to theproject’s cost baselines. (PMBOK® Glossary 165)

Management Reserve

Determining whether a particular product can be producedcost-effectively by the performing organization (PMBOK® 12.1.2.1).

Make-or-Buy Analysis

The act of applying updates, changes, and fixes to a product.Maintenance

Greatness in size or measurable quantity.Magnitude

The act of carrying on a suit in a court of law.Litigation

DefinitionTerm

Glossary



The time frame before a contract is awarded. The activities of the buyerand the seller before a contract is awarded. Phase 1 of the contractmanagement process.

Preaward

Is the ability to get someone else to do something you wantdone, or the ability to make things happen or get things donethe way you want.

Power

The time frame after a contract has been awarded. The activities of thebuyer and the seller after a contract has been awarded. Phase 3 of thecontract management process.

Postaward

The physical work scheduled, plus the authorized budget to accomplishthe scheduled work. Previously, this was called the budgeted cost of workscheduled (BCWS). (PMBOK® p 204)

Planned Value (PV)

Meetings held to assess project status or progress (PMBOK® 10.3.2.1).Performance Reviews

Collecting and disseminating performance information to providestakeholders with information about how resources are being used toachieve project objectives (PMBOK® 10.3).

Performance Reporting

A monetary guarantee that the contractor will perform according tocontract terms.

Performance Bond

Awareness, comprehension; insight or intuition; discernment. To takenotice of; observe to achieve understanding.

Perceptions

Compensation to be paid in case of nonperformance of the conditions ofa contract.

Penalties

A government grant giving an inventor the exclusive right to make or sellhis or her invention for a limited period of time.

Patent

The right to reuse (that is, remarket, modify, enhance, and preparederivative works based on) all material prepared under a buyer's directionand control.

Ownership

The interest or stake the owners have in a company; the sum of theowners’ original investment plus the accumulation of all profits that havebeen retained (not distributed to stockholders) in the company sinceinception.

Owners’ Equity

A statement in a contract that specifies which provision should control ifthe contract or related contracts or agreements contain conflicting orinconsistent provisions.

Order of Precedence

A person who manages to achieve his or her goals.Operator

An unequivocal and intentionally communicated statement of proposedterms made to another party. A proposal is normally a written offer by aseller describing its offering terms.

Offer

Unsophisticated technique that uses the severity scores of the top 10 riskevents plus the sum of the scores; the normalized risk score then equalsrisk score (sum of severity ratings) times 10, divided by the number ofrisk events.

Normalized Risk Score

Failure of a party to meet an expectation or a contractual commitment.Nonperformance

DefinitionTerm

Glossary



Collection of generally sequential project phases (PMBOK® 2.1).Project Life Cycle

Project manager has full authority to assign priorities and direct the workof individuals assigned to the project (PMBOK® 2.3.3). There areadvantages and disadvantages: The project manager controls theresources. Directing work is easier without battling the functionalmanager, but few organizations have these structures given the expenseinvolved and loss of efficiencies.

Projectized OrganizationalStructure

A subset of project management that includes the processes required toensure that the project is completed within the approved budget. Itconsists of resource planning, cost estimating, cost budgeting, and costcontrol.

Project Cost Management

A repository for the project management system of a project. Thisrepository includes all the agreements, plans and procedures to befollowed by the project, and all of the project management productsproduced by these plans and procedures. Abbreviated “PCB.”

Project Control Book

Process used to monitor, evaluate, and compare the project’s plannedresults with its actual results to determine the status of cost, schedule,and technical performance objectives.

Project Control

Process that provides for acceptance of the project by the client/projectsponsor and includes completion of project records, final revision andissuance of documentation to reflect completion criteria, and retention ofessential project documentation.

Project Closeout

Clear statement of project intent; provides a preliminary delineation ofroles and responsibilities; serves as a reference of authority for the futureof the project.

Project Charter

A temporary endeavor undertaken to create a unique product or service.Temporary means that every project has a definite beginning and adefinite end. Unique means that the product or service is different insome distinguishing way from all similar products and services.(PMBOK® 1.2)

Project

Describing what the project team has accomplished (PMBOK® 10.3).Progress Reporting

Uses sequential network logic and a weighted average duration estimateto calculate project duration (PMBOK® 6.4.2.1).

Program Evaluation andReview Technique (PERT)

A group of interrelated projects managed together.Program

Identifying which project needs can best be met by procuring products orservices outside the project organization (PMBOK® 12.1).

Procurement Planning

Knowledge shared between two parties regarding a private matter,usually implying consent or concurrence. Note: When two parties signan agreement, there is privity between them.

Privity

The principal seller performing under the contract.Prime Contractor

Forecasting where difficulties might arise.Predicting Potential ProblemAreas

Method of constructing a project network diagram using nodes torepresent activities and connecting them with arrows that showdependencies; also called activity-on-node.

Precedence DiagrammingMethod (PDM)

DefinitionTerm

Glossary



The total funds received from the sales of products or services.Revenue

Description of the types of resources required and in what quantities foreach element of the WBS (PMBOK® 7.1.3.1).

Resource Requirements

A form of network analysis in which scheduling decisions (start and finishdates) are driven by resource management concerns (PMBOK®

6.4.2.4).

Resource Leveling

Provision in the project plan to mitigate cost and schedule risk (PMBOK® 11.5).

Reserve

Statement of desire for a future system.Requirements

Legal actions for enforcing a right or compensating a wrong.Remedies

Dependencies that exist between activities.Relationships

A mutual exchange of trade or other concessions or privileges betweentwo parties.

Reciprocity

Identifying which quality standards are relevant to the project anddetermining how to satisfy them (PMBOK® 8.1).

Quality Planning

Evaluating overall project performance on a regular basis to provideconfidence that the project will satisfy the relevant quality standards(PMBOK® 8.2).

Quality Assurance

Measuring the probability and consequences of risks and estimating theirimplications for project objectives. (PMBOK® 11.4).

Quantitative Risk Analysis

Performing a qualitative analysis of risks and the conditions to prioritizetheir efforts on project objectives. (PMBOK® 11.3).

Qualitative Risk Analysis

Material on which the copyright or patent right has expired and that isavailable for unrestricted use. Property owned by a state or nationalgovernment.

Public Domain

Owned by a particular person; relating to a certain owner.Proprietary

A definition of the business opportunity that is to be accomplished in aproject; includes a statement of the business need, a set of requirements,and a schedule.

Proposition

A person who helps bring about or further the growth or establishment ofa project or an organization.

Promoter

People who plan, implement, and monitor the work being performed forthe client/project sponsor.

Project Team

People with an interest or role in the project.Project Stakeholders

The planned dates for performing activities and meeting milestones(PMBOK® 6.4.3.1).

Project Schedule

Quantifiable criteria that must be met for the project to be consideredsuccessful (PMBOK® 5.2.3.2).

Project Objectives

Schematic display of the project’s activities and the logical relationships(dependencies) among them.

Project Network Diagram

Individual accountable for the project who is the single point of contact forthe project and is responsible for identifying potential stakeholders.

Project Manager

Applying knowledge, skills, and tools to project activities, subprojects,and programs to meet or exceed stakeholder needs and expectations.

Project Management DefinitionTerm

Glossary



A strategic process for identifying and managing possible future eventswhich may influence project performance and results. The process isapplied throughout the project life cycle and is most valuable whenstarted early

Risk Management

Used to summarize risk events and their status.Risk Log

A formal facilitated workshop intended to identify risks to the project.Risk Identification Workshop(RIW)

The product of a risk identification workshop; it lists risks by focus area,risk drivers, risk owners, actions required to facilitate evaluation of risks,and a preliminary prioritization of the risks identified.

Risk Identification Report(RIR)

Determining which risks are likely to affect the project and documentingthe characteristics of each risk. (PMBOK® p 207).

Risk Identification

A potential source of risk.Risk Focus Area

A consistent way to relate probability and impact with respect to a givenrisk event.

Risk Event Severity Matrix

The likelihood (expressed as a percentage) that a possible risk event willoccur.

Risk Event Probability

The effect imposed on a project if a risk event occurs.Risk Event Impact

A possible occurrence that, if it does happen, will impact the achievementof project objectives.

Risk Event

Determining the probability of occurrence, the magnitude of loss orimpact of each identified risk event, and the severity of risk.

Risk Evaluation

A condition that increases the probability of impact to a project objective.Risk Driver

Used to provide a description of a risk identified in the risk identificationreport.

Risk Control Form (RCF)

Monitoring and managing risk.Risk Control

A checklist of potential focus areas and risk drivers; most checklists havean evaluation capability, and some offer mitigation suggestions.

Risk Checklist

Risk evaluation technique that makes use of a checklist of risk sourcesagainst which selected conditions in a proposal or concept are compared.In some business units, tools are available to facilitate the comparison,provide a score, and in some cases suggest mitigation approaches.

Risk Assessment Checklist(RACL)

Used to keep track of the action plan for each risk event; there is oneRAL for each risk event.

Risk Action Log (RAL)

A possible undesirable and unplanned event that could result in theproject’s not meeting one or more of its objectives.

Risk

Synonymous with ownership as it applies to materials that are consideredintellectual property, including code, program listings, reports,documentation, programming tools, drawings, and similar works; it doesnot include licensed programs.

Rights in Data

Claims, power, or privileges to which a party is justly entitled; can belegally enforceable.

Rights

Formal management actions that promote or reinforce desired behavior(PMBOK® 9.3.2.3).

Reward and RecognitionSystems

DefinitionTerm

Glossary



One source among others in a competitive marketplace that, forjustifiable reason, is found to be most worthy to receive a contract award.

Single Source

Selling expenses result from a company’s efforts to make sales, such assales commissions. General and administrative expenses are expensesincurred to support the operations of a company, such as utilities, rent,and so forth.

Selling, General, andAdministrative Expenses(SG&A)

The difference between the amount of work performed and what wasplanned or scheduled.

Schedule Variance (SV)

A measure used to calculate performance efficiency with respect toschedule. BCWP/BCWS.

Schedule Performance Index(SPI)

The approved project schedule; provides the basis for measuring andreporting schedule performance (PMBOK® 6.5.1.1).

Schedule Baseline

Planned dates for performing activities and meeting milestones.Schedule

A share of proceeds paid to a proprietor, author, or inventor by thosedoing business under some right belonging to that proprietor, author, orinventor.

Royalties

Assigning roles (who does what) and responsibilities (who decides what)to appropriate project stakeholders; uses a responsibility assignmentmatrix (RAM) (PMBOK® 9.1.3.1).

Role and ResponsibilityAssignments

Developing procedures and techniques to enhance opportunities andreduce threats to the project’s objectives. (PMBOK® 11.5).

Risk Response Planning

Person assigned primary responsibility to mitigate a particular risk eventand keep the project team informed of the status of efforts; the ownershould be the person who controls the source of the risk.

Risk Owner

Monitoring residual risk, identifying new risks, executing risk reductionplans, and evaluating their effectiveness throughout the project life cycle.Generally occurs in the life-cycle phases, starting with delivery anddevelopment and continuing through the end of the project life cycle;consists of all efforts to execute the risk management plan, iterate the riskmodel, and improve or achieve effective management of risk on a givenproject. PMBOK® 11.6).

Risk Monitoring and Control

The four-step interactive process that is focused on risk identification,evaluation, mitigation, and monitoring and applied throughout the projectlife cycle.

Risk Model

A facilitated workshop intended to identify and develop risk mitigationoptions and actions.

Risk Mitigation Workshop

The product of a risk management workshop; contents include alternativepropositions considered, recommended mitigation plans, problems,recommended contingency actions and costs, recommended actionplans, and risk evaluation.

Risk Mitigation Report (RMR)

Risk response strategy that decreases risk by lowering the probability of arisk event’s occurrence or reducing the effect of the risk should it occur.

Risk Mitigation

Deciding how to approach and plan risk management activities for aproject. (PMBOK® 11.1).

Risk Management Planning

Documenting the procedures to be used to manage risk throughout theproject (PMBOK® 11.1.3).

Risk Management Plan

DefinitionTerm

Glossary



Clause in a contract that defines the circumstances under which one orboth of the parties can end the agreement. Termination might be forcause when one party does not do something called for in the contract,causing the other party to terminate (for example, the client fails to paythe bill). Usually termination requires written notice within a certain periodof time (for example, 60 days).

Termination

Relates to observable behaviors and core values that help shape one’sleadership and management styles.

Temperament Defined

What the team believes will happen.Team Predictions

Enhancing the ability of stakeholders to contribute as individuals as wellas enhancing the ability of the team to function as a team.

Team Development

Sets broad performance objectives, the roles and responsibilities for theproject team, and ground rules for the team’s operation.

Team Charter

Management and individual actions taken specifically and primarily toimprove team performance (PMBOK® 9.3.2.1).

Team-Building Activities

A small number of people with complementary skills who arecommitted to a common purpose, performance goals, andapproach for which they hold themselves mutually accountable.

Team

Process used by the project manager to manage and control suppliers’responsibilities and performance on the project.

Supplier Management

A business entity that can provide a product or service as a third party,part of a client/project sponsor organization, or part of your ownorganization.

Supplier

Part of a project managed with a level of independence.Subproject

A business entity that does work for you under a contract.Subcontractor

A contract between a buyer and a seller in which the products or servicesbeing acquired are for use in a prime contract.

Subcontract

Describing where the project now stands (PMBOK® 10.3).Status Reporting

Description of the procurement item in sufficient detail to allowprospective sellers to determine if they are capable of providing the item(PMBOK® 12.1.3.2).

Statement of Work

A clear and concise documentation of a risk event; consists of a conditionand a consequence for each identified risk event.

Statement of Risk

Individual or organization who is actively involved in the project or whoseinterests might be affected, either positively or negatively, as a result ofproject execution or successful project completion.

Stakeholder

What kinds of skills are required from what kinds of individuals or groupsin what time frames (PMBOK® 9.1.1.2).

Staffing Requirements

Individual or group within the performing organization that providesfinancial resources for the project (PMBOK® 2.2).

Sponsor

Statements of commitment for a future system.Specifications

The only source in a marketplace that offers a desired product or service.There are no other choices.

Sole Source

DefinitionTerm

Glossary



The items at the lowest level of the WBS (PMBOK® 5.3.3.1).Work Packages

Delivers a distinct, identifiable product or result with definite completioncriteria.

Work Element

An activity-oriented structure of the work to be done to systematicallypresent all the work on the project affecting cost, schedule, orspecifications. Each descending level represents an increasingly detaileddefinition of a project component. Project components may be productsor services.

Work Breakdown Structure(WBS)

Unplanned responses to negative risk events (PMBOK® 11.6.3.1).Workarounds

Serves as a repository for work element descriptions.WBS Dictionary

An assurance by the seller of property that the property is, or shall be, asit is represented or promised; an agreement that the seller will fix adefect. Warranty will be limited in time.

Warranty

The voluntary relinquishment of a right, privilege, or advantage.Waiver

A business entity that provides a commercial, off-the-shelf product.Vendor

The difference between the budget at completion and the estimate atcompletion. BAC–EAC.

Variation at Completion(VAC)

Comparing actual project results to planned or expected results(PMBOK® 10.3.2.2).

Variance Analysis

Amount of time a full-time equivalent (FTE) can be used for the length ofthe project.

Utilization Factor

Not authorized or justified.Unwarranted

A type of contract in which the buyer pays a fixed price for each unit ofproduct purchased.

Unit Price

Passing from one activity to another smoothly.Transition

Amount of time an activity can be delayed from its early start withoutdelaying the project finish date.

Total Float

Use of a consistent method to weigh and apply the probability and impactof risk events as a basis for establishing priority to determine the top 10risk events.

Top 10 Scoring

A measure that provides ratio of the work remaining to the budgetremaining. (BAC–BCWP)/(BAC–ACWP).

To-Complete PerformanceIndex (TCPI)

Without bias or preference. Being logical, detached, and analytical.To Be Objective

A statement in a proposal or contract that implies a seller must deliver aproduct or service in the shortest possible time.

Time Is of the Essence

A type of contract in which the buyer reimburses the seller for laborexpended and the cost of materials provided.

Time-and-Materials

Another business entity, not part of your own or the client/projectsponsor’s business.

Third Party

Terms—The essential statements on which the validity of the contractdepends. Conditions— Defined events that must occur before contingentterms in a contract become fixed.

Terms and Conditions

DefinitionTerm

Glossary



A work product that is specified in an agreement is called a deliverable

� Services work products, which are services provided by the project.

� Management work products, which are the items related to themanagement of the project

Work Time

� Technical work products, which are items produced by the projectWorks for Hire

There are three types of work products:Working Hypothesis

Any measurable, tangible, verifiable outcome, result, or item that mustbe produced by a project or sub-project.A work product that is specified in an agreement is called a deliverable

Work Products

DefinitionTerm

PMBOK" is a trademark of the Project Management Institute, Inc. which is registered in the United States and other nations.

Glossary



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