PRINCE2 principles definition 

 November 15, 2023

By  Dave Litten

PRINCE2 principles definition

The PRINCE2 principles are the guiding obligations that determine whether the project is genuinely being managed using PRINCE2 and ensure the practical application and tailoring of PRINCE2 to any project.

PRINCE2 suits every project, regardless of type, size, complexity, importance, risk level, or delivery method (linear-sequential, iterative-incremental, or hybrid). Moreover, it can be used for all types of organizations, whether commercial, governmental, non-profit, or not-for-profit.

Additionally, it is applicable for projects anywhere in the world, with its ability to incorporate country-specific regulations, business models, and cultures. The method is flexible to enable PRINCE2 to be used for such a wide range of projects.

Rather than prescribing what to do to align the method to the specific project, PRINCE2 offers guidance through principles. These principles enable the project management team to decide how PRINCE2 will be used on their project.

The seven PRINCE2 principles are:

Ensure continued business justification.
Learn from experience.
Define roles, responsibilities, and relationships.
Manage by stages.
Manage by exception.
Focus on products.
Tailor to suit the project.

How the method is applied and tailored depends on the nature of the project and factors internal and external to the business, as shown below

Prince2 Principles Definition Ensure Continued Business Justification.

The seven principles offer flexibility, as they guide how the integrated elements of the method can be applied and tailored to find the best fit for the project and its context while keeping the integrity of the methodology. So long as
The principles are followed, and PRINCE2 is being used effectively.

Ensure continued business justification.

A PRINCE2 project has business justification sufficient to warrant investment to initiate the project and ongoing investment through to successful completion. If it does not, it should be stopped.

There must be a justifiable reason for starting a project, and the justification must remain valid and be revalidated throughout the project’s lifecycle.

The business justification drives decision-making to ensure the project remains aligned with the desired benefits and contributes to business objectives.

Organizations that need more rigour in business justification may find that projects proceed even when there are few real benefits or when a project has only tentative associations with the business strategy.

Poor alignment with business strategy can also result in organizations having a portfolio of projects with inconsistent or duplicated objectives.

Compulsory projects, such as those driven by legislation or regulation, still require justification for the chosen approach to ensure it represents the best value for money.

All parties involved in the project will need a balance between expected benefits, costs, and risks for them to have business justification for their involvement.

A project’s business justification may change; therefore, its delivery must remain consistent with its evolving justification. If continuing with the project can no longer be justified, then it should be stopped and ended in a controlled way.

Cancelling a project under these circumstances can benefit the business, as the project’s funds and resources can be reinvested in other, more worthwhile projects.

After completion, it should be reviewed to evaluate whether the benefits materialized sufficiently to warrant the final investment and what lessons can be learned from the project.

Ensure Business Justification examples

Below are some examples of applying the ‘ensure business justification’ principle.

Each party must have a clear business justification for undertaking and continuing with a commercial project with one or more customers and suppliers.

The customer may introduce a new product to enhance market share. The supplier’s business justification might include non-financial benefits, such as gaining an impressive customer reference for promotional purposes or building experience in applying new technologies.

For a co-owned project, such as a governmental project to jointly develop a new IT system across several agencies, if the business justification is lost for one or more parties, those parties should consider ending their participation in the project.

In this case, the consequences of ending or withdrawing participation in the project, such as contractual obligations, will inform the decision and any premature approach to closing the project.

Throughout the project, each investing party will need to monitor their business justification to ensure the project is worthwhile.

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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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