Management Stages within a PRINCE2 7 project
The goal of the project plan is to give the project board and the project manager confidence in proceeding with delivery.
PRINCE2 structures the management of the project on a stage-by-stage basis. Combined with the focus on products principle, managing by stages helps the project management team to plan and deliver what is required when it is required.
Stage division
Determining how to divide the project into stages is a matter of balancing:
- the delivery method (iterative-incremental or linear-sequential)
- the sequence of delivery activities
- the type of people and resources involved
- the number and timing of key decision points
- the amount of risk the project can manage
- how far ahead in the project it is sensible to plan.
The number of stages
The number of stages can vary, based on the nature of the products and the necessary delivery
activities. A greater number of stages increases the degree of control, but every stage boundary
requires effort to manage.
Therefore, there is a trade-off between the degree of control and the level of management overhead on the project.
For a simple project with a small number of well-understood products and mature delivery method,
only two stages may be required. These are an initiation stage to prepare the project initiation
documentation and a single delivery stage.
For a larger project with a complex set of products and a mix of delivery methods, multiple delivery
stages, each with their own products and stage boundaries, will be required.
This approach allows the project management team to refine its estimates in each stage plan and the project board to confirm that the project is continuing to satisfy its business justification.
For an iterative-incremental project, the project plan may provide multiple delivery stages in which
the quality and acceptance criteria are refined in parallel with development of the required products
through the use of a product backlog.
Some projects may need to align stage boundaries with external events. For example, in organizations with an annual budget cycle, there may be a requirement to provide an accounting of what the project has delivered and also what is in progress as it stands at the end of the budget year prior to authorization of the next portion of the project budget.
Stage length
Determining the appropriate length of a stage is a matter of assessing the following:
- the level of complexity: if the number and dependencies among delivery activities is high, a shorter stage may help avoid encountering exceptions to the approved tolerances.
- the level of risk: stages are useful in providing control over high-risk projects. Stage breaks can be inserted at key points where risks to the project can be reviewed before major commitment of resources.
- the planning horizon: if there is significant uncertainty in the estimates of resources or of the duration of activities, a shorter stage can allow these estimates to be refined in the next stage plan.
- appropriate decision points: stage boundaries should be aligned with critical decisions to be made by the project board (such as whether and how to continue after delivery of a prototype) or business layer decisions or events (such as a business planning cycle).
- alignment with programme activities: programmes may be organized around groups of projects structured around distinct changes in capability and delivery tranches. The programme may require the project to align the end of a stage with the end of a programme tranche.
The length of stages does not have to be uniform throughout the project. The design or prototyping
stages for a new system, for example, may be much shorter than the build stage.
Stages and work packages
PRINCE2 stages do not overlap. Instead, they partition the project by introducing stop-go decision
points.
By not overlapping, they enable the project management team and project board to review progress and assess whether the project has continued business justification and therefore should proceed to the next stage.
The stages also enable the project management team and project board to maintain alignment with the business case through the plans for the subsequent stage and the decisions taken at stage boundaries.
Project work may be organized into logical groups of work packages, depending on the delivery
method being used, the set of specialist skills required, or the relationships of the organizations
involved.
Such logical groupings of activity may run in parallel and overlap. It is a good practice to avoid having work packages that span a stage boundary, as decisions taken at stage boundaries could lead to repeated work or waste relating to work in progress.
Where work packages span a stage boundary, such as work packages involving procurement of long lead items, their status will need to be reviewed as part of the process of managing a stage boundary.
Product creation points.
When looking at of the project schedule (normally in the form of a Gantt Chart), it is easy to see where key products must be completed. It makes good sense to harmonize and end stage assessment at the point when a key product completed.
This ties back to cost as well, since the completion of a major product will typically represent a major spent within a stage, and for the reasons given above, it would make good sense to schedule an end stage assessment.
Another factor which influences where the boundary of management stages occur, can be driven by the need for a decision point. An example might be the placement of a contract or a key acceptance meeting.
You can see that these management stages within a project are a powerful control point for the project board.
Duration of Management Stages
Management stages are normally different in time duration the work within each stage is different; indeed, it would be very unusual if a project had stages of identical duration.
If this did occur, I would suspect that the project board did not understand the purpose and application of PRINCE2 management stages.
Business points.
Organizations often set departmental fiscal budgets at the start of a business fiscal year. Although this makes for good fiscal control, it can give a problem to the project funding.
If the time-frame of my particulate project traverses this fiscal boundary, then it may be necessary to align an end stage assessment of one or more management stage with the end of the fiscal year.
There may be other key business points within an organization, for example a departmental audit or a major review, and these too, may need to be harmonized with an end stage boundary of management stage.
PRINCE2 defines management stages as partitions of the project with management decision points, they also equate to the commitment of resources and authority to spend. A management stage therefore is a collection of activities and products whose delivery is managed as a unit.
Every project using PRINCE2 will have a minimum of two management stages: the initiation stage where the Project Initiation Documentation is created, and at least one delivery stage, so-called, because a delivery stage is where the specialist products are created and approved.
Therefore management stages only occur one at a time; they do not overlap. There are many advantages of splitting a project into a series of management stages:
Providing at the end of the stage, an end stage assessment, to allow review and decision points for the project board to assess the project viability at regular intervals rather than letting it run on in an uncontrolled manner.
Another advantage is that stages give the ability to make key decisions prior to investing in the detailed work and cost of the following stage. Management stages also facilitate the management by exception principle by delegating authority to the project manager on a stage by stage basis.
The project board will release the project to the project manager one stage at a time, and only after considering the business case, project plan, next stage plan, and End-Stage Report. The next stage will only be authorized if there is sufficient business justification for the project to continue.
With management by Exception implemented, there is no need for “regular progress meetings”. Don’t’ get confused, the end stage assessment is fundamentally a business review (although progress information is gathered and presented).
The project manager will have the authority for day to day management and control of a stage as long as the agreed tolerances are forecast not to be exceeded. By virtue of this, the project board can manage by exception while reducing the administrative overhead of being involved while still keeping in control
When considering how many management stages within a project, there are several key questions that need to be asked to help define this number. For example, how far ahead in the project is it sensible to plan? Where do key decision points need to be?
In addition, if the project is a risky one then management stages will tend to be shorter in duration. The confidence of the project board and project manager in the project, will also determine how many stages and how long particular stages needs to be.
There is clearly a balance between many short stages with an increase in overhead, versus few long stages resulting in less control. The number of stages in a project should be chosen by asking the question “ where do the end stage assessments need to be so that project viability can be checked?”
It is important that management stages are not confused with technical stages. These are often called phases, and refer to sensible groupings of products and techniques. Technical stages of the overlap, whereas management stages do not. Technical stages are typified by the use of a particular set of specialist skills.
Whenever a technical stage spends beyond a management stage boundary, the technical stage should be broken down so that each management stage contains a whole number of specialist products.
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