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PRINCE2 Practitioner Exam – The Seven PRINCE2 Principles 

 September 5, 2020

By  Dave Litten

Dave Litten Prince2 Coach Seven Prince2 Principles

Okay, so PRINCE2 has seven Principles. When preparing for your PRINCE2 Practitioner Exam, it is very easy to just note down the seven types of Principle, and note their purpose. Then you move on with your study, happy that you have understood these ‘simple’ applications of a PRINCE2 project. Big Mistake. Come the day, when you are confronted with your first PRINCE2 Practitioner question on PRINCE2 Principles – you are stunned, that you are struggling to find the correct answer. Why is this? Well, the question may ask “Is this an appropriate application of a given PRINCE2 Principle, and why, or why not?” Because the seven Principles are so fundamental, all four answer options can seem reasonable – but which the CORRECT one? With that in mind, I have put together this PRINCE2 Practitioner Exam Principles blog.

Read. Absorb. Apply. Pass.

Dave Litten

The first integrated element of PRINCE2 is the principles

You can think of these as the core guiding concepts that the rest of PRINCE2 adheres to. If a project management team is not practising all of the principles, it is not a PRINCE2 project. There are seven PRINCE2 principles. An example could be “learn from experience “, which means that before anything is done to manage a project, it is always worth considering any prior experience that might be useful. I will now describe each principle in turn:

Continued business justification

The principle of continued business justification ensures there is a documented justification for starting a project. It ensures this justification is reviewed and possibly updated throughout the life of the project. 

You should use the latest version of the justification to decide whether to move on to each major stage of the project. Very often this justification is written up in some form of business case. It is important that the justification for a project aligns with the overall business strategy of the organisation that is commissioning the project. If this is not the case, and organization could end up running multiple projects that are inconsistent with one another and start to work against each other.

Even projects that are driven by legislation changes or the need to be compliant with the new regulation, should have a business case.

PRINCE2 Provides a range of activities with associated responsibilities to ensure continued business justification. These are described throughout the process model and in the business case theme.

PRINCE2 Provides two important business-related management products: the business case, which documents the justification for undertaking the project, and the benefits management approach, which plans the reviews of the project’s benefits.

Using the continued business justification in the starting up a project process

The continued business justification is implemented by the creation of the outline business case and then the detailed business case , the appointment of the executive to represent the business interest, and the verification that a business case exists during all the directing a project process authorization points.Although all seven principles contribute to implementing the business case theme in some way, the two that are most important are the principles of continued business justification and the defined roles and responsibilities. As a minimum, it is essential that however the business case theme is implemented, there is a clear business justification for the project that is updated throughout the project and taken into account when making key decisions. This essentially is what the continued business justification principle outlines. The other minimum requirement is that the project team is clear about who has which business case responsibility, which aligns with the principle of defined roles and responsibilities.

Prince2 Controlling A Stage Process

Learn from experience

When you are managing a project, it is a good idea to take into account the good practise and the mistakes made in past projects. Also, it is a good idea to collate the lessons learned during the management of the current project and pass them onto teams managing subsequent projects. During many of the management activities throughout the process model, PRINCE2 constantly highlights the need to take account of past experience and collate new knowledge. It provides two important management products to help implement the learn from experience principle: the lessons log, which is used to record both previous and current experience, and the lessons report, which is used to pass on experience from the current project to those who will manage subsequent projects. The progress theme describes how to control the flow of experience.Learn from experience is implemented during the starting up a project process by the creation of the lessons log, which is populated with previous useful experience, and by considering lessons when carrying out any of the activities in the starting up a project and initiating a project processes.

Defined roles and responsibilities

It is important that each role in the project management team be performed by someone who understands what is expected of them and who is willing to take on that role. This is the PRINCE2 principle of defined roles and responsibilities. The project management team must include people from a broad range of stakeholder perspectives, especially those viewing the project from business, user, and supplier perspectives. The project management team should include appropriate roles for the various management levels of the organisations involved.

PRINCE2 Provides a project management team structure. For each role within the structure, it sets out a range of responsibilities. For each activity in the process model, there is a defined role (or roles) responsible for that activity. The project management team structure and the associated roles are first set out in the project brief and then in the project initiation documentation (PID).The communication management approach describes how the communication between these people will be managed.

Defined roles and responsibilities are implemented by the establishment of a project management team in the starting up a project process, the appointment of people to the various roles, and the verification that they understand their project responsibilities. Although all seven PRINCE2 principles are implemented in part by using the ideas within the organization theme, the main principle implemented is that defined roles and responsibilities. The organisation theme makes it clear which responsibilities need to be done in order to increase the likelihood of a successful project and suggests a number of roles and then organisational structure that will be accountable for these responsibilities.

Manage by stages

The manage by stages principle, ensures that PRINCE2 projects are divided into a number of time periods, called management stages (or often just called stages). these stages could last days, weeks, or even months (or even for years).

A collection of products is created with any stage. The project board gives the project manager the authority to manage one stage at a time.

After a stage is complete, the project manager must report back to the project board members, who then review the stages performance and other factors, such as the current state of the projects business case, and decide whether to authorise the next stage.

The project management team decides how to divide the project into stages when preparing the project plan at the outset of the project.

This approach has two benefits. First, it helps with planning. There is always a planning horizon beyond which it is difficult to forecast. As an example here, at the beginning of designing work in say, stage 2, it is impossible to plan in detail the building work of stage 3, because at this point, the specification of the project end product may not have been decided .With the PRINCE2 manage by stages approach, the detailed stage plan for each stage is not created until the end of the previous stage. The project plan, which covers the whole project and is created at the outset, is done from a high-level perspective.The other major benefit is that the senior managers taking on roles in the project board do not need to get involved with the day to day management of the stages. However, they can retain control of the project by authorising progress a stage at a time. This is an efficient way of using senior management time.

Senior managers can also vary the amount of control they have by shortening or lengthening the stages. Every PRINCE2 project always has at least two management stages – a planning stage (or what PRINCE2 calls the initiation stage), and at least one other stage where specialist products are delivered. Manage by stages is implemented by the creation of a project plan divided into various management stages, and by the project boards authorization of the project managers work one stage at a time – first for the initiation stage and then for the first delivery stage.

Manage by exception

In PRINCE2, each management level manage is the level below using the manage by exception principle. The project management team structure has four levels of management. At the top is a group called corporate, programme management, or the customer, who instigate the project. Below them is the project board, the main decision-making body on the project. Then comes the project manager, who manages the project on a day to day basis. Finally, at the bottom, are the team managers and their teams, who create the projects products.

So corporate, programme management, or the customer manage the project board by exception, then the project board manages the project manager by exception, and, finally, the project manager manages the specialist team manager by exception. Manage by exception means that the upper level of management gives the level of management below them a piece (or all) of the project to manage on their behalf. The upper level of management also set certain boundaries around the lower level of management’s authority.

The lower level of management then needs further authorization from the level of management above them in only one or two circumstances – either they have finished delivering their piece of the project and they want to move on to a new piece of work, or they realise that a situation has arisen that breaches the boundaries of their delegated authority. The upper level of management defines the authority they give to the level of management below them by setting constraints around the six areas of time, cost, scope, quality, risk and benefits

A certain amount of leeway, or what PRINCE2 cause tolerances, may be allowed around those constraints. If at any time it appears these constraints may be breached, the lower level of management must escalate the situation to the level of management above them. This situation is called an exception. Here are some examples of the six areas where constraints can be set:

Time

The upper level of management gives the level of management below them a certain amount of time to carry out their work within certain tolerances. For example, the work must be finished in six months, with a permissible early delivery of two weeks and late delivery of one week. If the lower level of management believes they cannot deliver the work within this three-week range, they must escalate the situation to the level of management above them.

Cost

The upper level of management gives the level of management below them a certain budget to spend, possibly with some permissible leeway. For example, the budget could be $10,000 with an allowable under spend of $1000 and no allowable overspend. If the lower level of management forecasts they cannot deliver their work for between $9000 and $10,000, they must escalate the situation to the level of management above them 

Scope

The upper level of management gives the level of management below them a set of products that need to be delivered with any possible variation allowed. For example, the product could be a website with pages that contain information on all the company’s primary services and, if time permits, the secondary services. If the lower level of management realizes, they will not be able to deliver even the primary service pages, they must escalate the situation to the level of management above them.

Quality

The upper level of management gives the level of management below them a set of specifications for all the products that should be created. These are specified in an appropriate manner to an appropriate level of detail for that management level. Any tolerance around the specifications will also be shown – for example, create an Olympic stadium 50 to 60 metres high. If the lower level of management cannot deliver products within these specification ranges, they must escalate the situation to the level of management above them.

Risk

The upper level of management gives the level of management below them a threshold value of aggregated risk. An example is that expected costs of the predicted threats must not exceed $20,000. If the lower level of management Realises this threshold level of risk will be breached, they must escalate the situation to the level of management above them.

Benefits

The objectives for the project’s benefits may also be given some allowable deviation by corporate, programme management, or the customer. For example, sales from the project must be in the range of $500,000 to $600,000. If this forecast looks as though it will not be possible, the situation should be escalated back to corporate, programme management, or the customer. Management by exception provides for efficient use of senior manager’s time. They do not have to get involved in the day to day work of the level below. However, they can control the work of the level below by setting tolerances around those six areas. Manage by exception is implemented by the project board defining certain tolerances within which the project manager must manage the initiation stage and the first delivery stage. It is also implemented by corporate, programme management, or the customer setting tolerances for the project board for the project.

Focus on products

A product can be tangible like a train or intangible such as trained staff. They are always inputs or outputs from a series of activities. For example, if my project were to develop a training course and train a group of staff, the products might include the existing corporate training standards that my training course needs to comply with, the set of slides that I need to create to show during the course, and the final product, which is a group of trained staff .In PRINCE2, products are sometimes referred to as outputs or deliverables.

The principle of focus on products, in shows that through every step of the project, what the project is creating is clearly defined and agreed to. In PRINCE2, these product specifications are set out in product descriptions. The product descriptions are then used as the basis of planning the activities needed to create the products, manage proposed changes to the products, and verify approval and acceptance of the products once they have been built.This seems like a rather obvious thing to do. However, many projects miss this simple approach, and as a result, disputes occur over the acceptance of the products, uncontrolled changes are introduced, or the wrong outputs are created. Also, when a project management team is not focused on the end goal of the projects activities, which is to create the agreed products, they sometimes do unnecessary work or start to create products that were not needed nor agreed to .Focus on products is implemented first by:

  • specifying the overall output of the project in the project product description
  • specifying the major products in their product descriptions
  • creating the quality management approach, which defines how the project will be managed to ensure that the right products are created

Tailor to suit the project

Projects come in many different shapes and sizes. There are small projects, large projects, engineering projects construction projects public sector projects, and so on. There are predicted projects and agile projects which use incremental and iterative approaches. PRINCE2 can be tailored to suit all of them.PRINCE2 says that it is mandatory to tailor the method, and there are many reasons why a project management team would want to tailor PRINCE2.

Tailoring PRINCE2 helps reduce the project risk. There are many factors that might influence how PRINCE2 is tailored, including the capability of the project management team, the maturity of the team, and any legal contracts that apply to the project’s work.

  • Every PRINCE2 project, no matter how small, must abide by the seven principles
  • Each PRINCE2 theme has a set of minimum requirements that must be applied. for example, in the plans theme, PRINCE2 states that every project must have at least two management stages.
  • PRINCE2 often suggests a technique, but it is not mandatory that you use that technique
  • When the project management team is considering how much tailoring is required, they should balance the costs against carrying that out against the benefits that such tailoring will bring

Tailored to suit the project environment is implemented by including a section in the project initiation documentation (PID) that shows how PRINCE2 will be tailored for the project.

https://www.projex.com/courses/prince2-masterclass/

Dave Litten


Dave spent 25+ years as a senior project manager for UK and USA multinationals and has deep experience in project management. He now develops a wide range of Project Management Masterclasses, under the Projex Academy brand name. In addition, David runs project management training seminars across the world, and is a prolific writer on the many topics of project management.

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