Appendix A
Critical Exam Information
Exam candidates want to pass their PMP exam on the first attempt. Why bother sitting for an exam if you know you’re not prepared? In this appendix, you’ll find the details that you must know to pass the exam. These facts won’t be everything you need to know to pass the PMP exam—but you can bet you won’t pass if you do not know the critical information in this appendix.
Exam Test-Passing Tips
For starters, don’t think of this process as preparing to take an exam; think of it as preparing to pass an exam. Anyone can prepare to take an exam: just show up. Preparing to pass the PMP exam requires project management experience, diligence, and a commitment to study.
Days Before the Exam
In the days leading up to your scheduled exam, here are some basics you should do to prepare yourself for success:
Get some moderate exercise Find time to go for a jog, lift weights, take a swim, or do whatever workout routine works best for you.
Eat smart and healthy If you eat healthy food, you’ll feel good—and feel better about yourself. Be certain to drink plenty of water, and don’t overdo the caffeine.
Get your sleep A well-rested brain is a sharp brain. You don’t want to sit for your exam feeling tired, sluggish, and worn out.
Time your study sessions Don’t overdo your study sessions—long cram study sessions aren’t that profitable. In addition, try to study at the same time every day at the time your exam is scheduled.
Practice the Testing Process
If you could take one page of notes into the exam, what information would you like on this one-page document? Of course, you absolutely cannot take any notes or reference materials into the exam area. However, if you can create and memorize one sheet of notes, you absolutely may re-create this once you’re seated in the exam area.
Practice creating a reference sheet so you can immediately, and legally, re-create this document once your exam has begun. You’ll be supplied with several sheets of blank paper and a couple of pencils. Once your exam process begins, re-create your reference sheet. You cannot begin creating your reference sheet until you’ve started the exam. The following are key pieces of information you’d be wise to include on your reference sheet (you’ll find all of this key information in this appendix):
Activities within each process group
Estimating formulas
Communication formula
Normal distribution values
Earned value management formulas
Project management theories
Testing Tips
The questions on the PMP exam are fairly direct and not too verbose, but they may offer a few red herrings. For example, you may face questions that state, “All of the following are correct options expect for which one?” The question wants you to find the incorrect option, or the option that would not be appropriate for the scenario described. Be sure to understand what the question is asking for. It’s easy to focus on the scenario presented in a question and then see a suitable option for that scenario in the answer. The trouble is that if the question is asking you to identify an option that is not suitable, you just missed the question. Carefully read the question to understand what is expected for an answer.
Here’s a tip that can work with many of the questions: Identify what the question wants for an answer and then look for an option that doesn’t belong with the other possible answers. In other words, find the answer that doesn’t fit with the other three options. Find the “odd man out.” Here’s an example: EVM is used during the _______________.
A. Controlling phase
B. Executing phase
C. Closing phase
D. Entire project
Notice how options A, B, and C are exclusive? If you choose A, the controlling phase, it implies that EVM is not used anywhere else in the project. The odd man out here is D, the entire project; it’s considered the “odd” choice because it, by itself, is not an actual process group. Of course, this tip won’t work with every question—but it’s handy to keep in mind.
For some answer choices, it may seem like two of the four options are both possible correct answers. However, because you may only choose one answer, you must discern which answer is the best choice. Within the question, there will usually be some hint describing the progress of the project, the requirements of the stakeholders, or some other clue that can help you determine which answer is the best for the question.
Answer Every Question—Once
The PMP exam has 200 questions—of which 175 are “real questions.” You don’t have to answer every question correctly; just answer enough correctly to pass. In other words, don’t waste three of your four hours laboring over one question—the easy questions are worth just as much as the hard ones. And you know, I’m sure, that you never leave any question blank—even if you don’t know the answer. A blank question is the same as a wrong answer. As you move through the exam and you find questions that stump you, use the “mark question” option in the exam software, choose an answer you suspect may be correct, and then move on. When you have answered all of the questions, you are given the option to review your marked answers.
Some questions in the exam may prompt your memory to come up with answers to questions you have marked for review. However, resist the temptation to review those questions you’ve already answered with confidence and haven’t marked. More often than not, your first instinct is the correct choice. When you completed the exams at the end of each chapter, did you change correct answers to wrong answers? If you did it in practice, you’ll do it on the actual exam.
Use the Process of Elimination
When you’re stumped on a question, use the process of elimination. For each question, there’ll be four choices. On your scratch paper, write down “ABCD.” If you can safely rule out “A,” cross it out of the ABCD you’ve written on your paper. Now focus on which of the other answers won’t work. If you determine that “C” won’t work, cross it off your list. Now you’ve got a 50-50 chance of finding the correct choice. If you prefer, the exam testing software also includes the ability to “mark out” answers from the selection choices, but I prefer to do this process on the scratch paper to add any notes and references to the specific question should I need to come back to it later in the exam.
If you cannot determine which answer is best, “B” or “D” in this instance, here’s the best approach:
1. Choose an answer in the exam (no blank answers, remember?).
2. Mark the question in the exam software for later review.
3. Circle the “ABCD” on your scratch paper, jot any relevant notes, and then record the question number next to the notes.
4. During the review, or from a later question, you may realize which choice is the better of the two answers. Return to the question and confirm that the best answer is selected.
Everything You Must Know
As promised, this section covers all of the information you must know going into the exam. It’s highly recommended that you create a method to recall this information. Here goes.
The 49 Project Management Processes
Table A-1 lists the 49 project management processes you should be familiar with. I’ve ordered them here according to knowledge area and the corresponding chapter in this book.
TABLE A-1 Project Management Processes
Magic PMP Formulas
The following shows the major formulas you should know for the exam.
Earned Value Management Formulas
Table A-2 shows the EVM formulas you should know for the exam.
TABLE A-2 Project Management Earned Value Management Formulas
Quick PMP Facts
This section has some quick facts you should know at a glance. Hold on—this moves pretty fast.
Organizational Structures
Organizational structures are relevant to the project manager’s authority.
Organic or simple People work along one another regardless of their roles in the organization and the project manager may have little to no authority over the project resources.
Functional (centralized) Project managers in functional organizations have little authority, little autonomy, report directly to a functional manager, and may be known as project coordinators or team leaders.
Multidivisional This structure involves replication of functions for each division; similar to the functional organization within each division. The project manager will have little authority and could be called a project coordinator rather than a project manager.
Weak matrix Weak matrix structures map closely to a functional organization. The project team may come from different departments, but the project manager reports directly to a specific functional manager. The project manager has little authority or autonomy; the project manager and the team work part-time on the project. The functional manager controls the budget.
Balanced matrix A balanced matrix structure has many of the same attributes as a weak matrix, but the project manager has more time and power regarding the project. The project team and the project manager work part-time on the project. The project manager and the functional manager share the management of the project budget.
Strong matrix A strong matrix equates to a strong project manager. In a strong matrix organization, many of the same attributes for the project team exist, but the project manager gains power and time when it comes to project work. The project manager is a full-time project manager and the project manager manages the project budget.
Project-oriented A project-oriented organizational structure groups employees, collocated or not, by activities on a project. The project manager in a project-oriented structure may have complete, or very close to complete, power over the project team. Project managers in a project-oriented structure enjoy a high level of autonomy over their projects, but they also have a higher level of responsibility regarding the project’s success.
Virtual A virtual organization utilizes a network structure within the organization. Points of contact represent the different departments or lines of business within the organization. Communication can be a challenge in a virtual organization as messages are filtered through the point of contact for each department or stakeholder group. The project manager has low authority over the project team and shares authority over the project budget with the functional manager.
Hybrid Because hybrid structures are unique to each organization, it’s impossible to define the level or authority and the project manager’s role in a project. In some organizations using a hybrid model the project manager may have total control over the team and the project budget, while other organizations may allocate the project manager authority over the team, but keep the budget management for the functional manager.
PMO A project management office (PMO) organizes and manages control over all projects within an organization. A PMO is also known as a program management office, project office, or sometimes, the program office.
WBS Facts
The work breakdown structure is the big picture of the project deliverables: It is not the activities that will create the project, but the components the project will create. The WBS helps the project team and the project manager create accurate cost and time estimates. The WBS also helps the project team and the project manager create an accurate activity list. The WBS is part of the scope baseline, which also includes the scope statement, the WBS dictionary, the work packages, and the planning packages.
Project Scope Facts
Projects are temporary endeavors to create a unique product. They are selected by one of two methods:
Benefit measurement methods These include scoring models, cost-benefit ratios, and economic models.
Constrained optimization These include mathematical models based on linear, integer, and dynamic programming. (This probably won’t be on the PMP exam as a viable answer.)
The project scope defines all the required work, and only the required work, to complete the project. Scope management is the process of ensuring that the project work is within scope and protecting the project from scope creep. The scope statement, along with the WBS and WBS dictionary, is the baseline for all future project decisions. There are two types of scope:
Product scope Defines the attributes of the product or service the project is creating
Project scope Defines the required work of the project to create the product
Scope validation is the process completed at the end of each phase and of each project to confirm that the project has met the requirements. It leads to formal acceptance of the project deliverable.
Project Schedule Facts
Time can be a project constraint. Effective time management is the scheduling and sequencing of activities in the best order to ensure that the project completes successfully and in a reasonable amount of time. These are some key terms for time management:
Lag Waiting between activities.
Lead Activities come closer together and even overlap.
Free float The amount of time an activity can be delayed without delaying the next scheduled activity’s start date.
Total float The amount of time an activity can be delayed without delaying the project’s finish date.
Float Sometimes called slack—a perfectly acceptable synonym.
Duration May be abbreviated as “du.” For example, du = 8d means the duration is eight days.
There are three types of dependencies between activities:
Mandatory This hard logic requires a specific sequence between activities.
Discretionary This soft logic prefers a sequence between activities.
External Due to conditions outside of the project, such as those created by vendors, the sequence must happen in a given order.
Project Cost Facts
The following are methods of providing project estimates:
Bottom-up Project costs start at zero, each component in the WBS is estimated for costs, and then the “grand total” is calculated. This is the longest method to complete, but it provides the most accurate estimate.
Analogous Project costs are based on a similar project. This is a form of expert judgment, but it is also a top-down estimating approach, so it is less accurate than a bottom-up estimate.
Parametric modeling Using historical data, price is based on cost per unit; examples include cost per metric ton, cost per yard, and cost per hour.
Four types of costs are attributed to a project:
Variable costs The costs are dependent on other variables. For example, the cost of a food-catered event depends on how many people register to attend the event.
Fixed costs The cost remains constant throughout the project. For example, a rented piece of equipment requires the same fee each month, even if it is used more in some months than in others.
Direct costs The cost is directly attributed to an individual project and cannot be shared with other projects (for example, airfare to attend project meetings, hotel expenses, and leased equipment that is used only on the current project).
Indirect costs These are the costs of doing business; examples include rent, phone, and utilities.
Quality Management Facts
The cost of quality is the money spent investing in training, in meeting requirements for safety and other laws and regulations, and in taking steps to ensure quality acceptance. The cost of nonconformance is the cost associated with rework, downtime, lost sales, and waste of materials.
Some common quality management charts and methods include the following:
Ishikawa diagrams (also called fishbone diagrams and why-why charts) are used to find causes and effects that contribute to a problem.
Flow charts show the relationship between components and the flow of a process through a system.
Pareto diagrams identify project problems and their frequencies. These are based on the 80/20 rule: 80 percent of project problems stem from 20 percent of the work.
Control charts plot out the result of samplings to determine whether projects are “in control/specification” or “out of control/specification.”
Kaizen technologies comprise approaches to make small improvements in an effort to reduce costs and achieve consistency.
Just-in-time ordering reduces the cost of inventory, but requires additional quality because materials would not be readily available if mistakes occur.
Project Resource Facts
The PMP candidate should be familiar with the following human resource theories that may appear on the PMP exam:
Maslow’s Hierarchy of Needs There are five layers of needs for all humans: physiological, safety, social (such as love and friendship), self-esteem, and the crowning jewel, self-actualization.
McClelland’s Theory of Needs Needs are developed by the person’s life experiences and may shift over time. Of the three needs that drive people—power, affiliation, and achievement—one of these is the most prominent in the individual. McClelland developed the Thematic Apperception Test to determine what needs are driving individuals.
Herzberg’s Theory of Motivation There are two catalysts for workers: hygiene agents and motivating agents.
Hygiene agents do nothing to motivate, but their absence demotivates workers. Hygiene agents are the expectations all workers have: job security, a paycheck, clean and safe working conditions, a sense of belonging, civil working relationships, and other basic attributes associated with employment.
Motivating agents are the elements that motivate people to excel. They include responsibility, appreciation of work, recognition, opportunity to excel, education, and other opportunities associated with work other than just financial rewards.
McGregor’s Theory of X and Y This theory states that “X” people are lazy, don’t want to work, and need to be micromanaged and “Y” people are self-led, motivated, and can accomplish things on their own.
Ouchi’s Theory Z This theory holds that workers are motivated by a sense of commitment, opportunity, and advancement. Workers will work if they are challenged and motivated. Think participative management.
Expectancy Theory People will behave based on what they expect as a result of their behavior. In other words, people will work in relation to the expected reward of the work.
Communication Facts
Communicating is the most important skill for the project manager. With that in mind, here are some key facts on communication:
Communication channels formula: N(N –1) / 2. N represents the number of stakeholders. For example, if you have 10 stakeholders, the formula would read 10(10 –1) / 2 for 45 communication channels. Pay special attention to questions wanting to know how many additional communication channels you have based on added stakeholders. For example, if you have 25 stakeholders on your project and have recently added 5 team members, how many additional communication channels do you now have? You’ll have to calculate the original number of communication channels, 25(25 – 1) / 2 = 300; then calculate the new number with the added team members, 30(30 – 1) / 2 = 435; and finally, subtract the difference between the two: 435 – 300 = 135, the number of additional communication channels.
Fifty-five percent of communication is nonverbal.
Effective listening is the ability to watch the speaker’s body language, interpret paralingual clues, and decipher facial expressions. Following the message, effective listening has the listener asking questions to achieve clarity and offering feedback.
Active listening requires receivers of the message to offer clues, such as nodding to indicate they are listening. It also requires receivers to repeat the message, ask questions, and continue the discussion if clarification is needed.
Communication can be hindered by trendy phrases, jargon, and extremely pessimistic comments. In addition, other communication barriers include noise, hostility, cultural differences, and technical interruptions.
Risk Management Facts
Risks are uncertain events that can have positive or negative effects on a project. Most risks are seen as threats to the project’s success—but not all risks are bad. For example, there is a 20 percent probability that the project will realize a discount in shipping, which will save the project $15,000. If this risk happens, the project will save money; if the risk doesn’t happen, the project will have to spend the $15,000. Risks should be identified as early as possible in the planning process. A person’s willingness to accept risk is the utility function (also called the utility theory).
The only output of risk planning is the risk management plan. There are two broad types of risks:
Business risk The loss of time and finances (where a downside and upside exist)
Pure risk The loss of life, injury, and theft (where only a downside exists)
Risks can be responded to via one of seven methods:
Escalate The threat or opportunity may exceed the project boundaries or the project manager’s authority, so the risk is escalated to program manager, portfolio manager, or management.
Avoidance Avoid the risk by planning a different technique to remove the risk from the project.
Transference The risk is not eliminated, but the responsibility and ownership of the risk are transferred to another party (for example, through insurance).
Mitigation Reduce the probability or impact of the risk.
Acceptance The risk’s probability or impact may be small enough that the risk can be accepted.
Exploit The organization wants to ensure that the identified risk does happen so that the positive impact associated with the risk event is realized.
Share Sharing is nice. When sharing, the risk ownership is transferred to the organization that can most capitalize on the risk opportunity.
Enhance To enhance a risk is to attempt to modify its probability and/or its impacts to realize the most gains from the identified risk.
Risk management also includes the monitoring and controlling of risk characteristics, new risks, and the results of risk responses. Following are terms that are unique to risk management:
Risk Contingency funds Monies reserved for risk events.
Secondary risks A risk that comes into a project as a direct result of another risk response.
Risk triggers A condition, event, or warning signs of a risk event that causes a risk reaction.
Residual risks Risks that remain after a risk response. These are usually small and are accepted by the project team.
Procurement Facts
A contract statement of work (SOW) is provided to the potential sellers so they can create accurate bids, quotes, and proposals for the buyer. A bidders’ conference may be held so sellers can query the buyer on the product or service to be procured.
A contract is a formal agreement, preferably written, between a buyer and a seller. On the PMP exam, procurement questions are usually from the buyer’s point of view. All requirements the seller is to complete should be clearly written in the contract. Requirements of both parties must be met, or legal proceedings may follow. Table A-3 sums up all the contract types you should know for your exam.
TABLE A-3 Project Management Contract Types
You should also know that a purchase order is a unilateral form of contract and that a letter of intent is not a contract, but shows the intent of the buyer to purchase from a specific seller.
Stakeholder Engagement Facts
You must manage and engage the project stakeholders to create buy-in and ownership of the project—and this keeps the project moving forward. Stakeholder management means that you, the project manager, communicate with the project stakeholders, but you also work to keep them involved and informed of the project work.
Here are some facts you’ll need to know about stakeholder management for your PMP exam:
Stakeholder identification and documentation should happen as early as possible in the project. This process is part of project initiation.
You’ll need a stakeholder management plan to define the direction and strategy for engaging the stakeholders. This plan works along with the project’s communications management plan.
Stakeholder engagements mean that you’ll work with the stakeholders to maintain their interest and support of the project. You’ll address their needs, concerns, perceived threats, and even their pet requirements. The goal is to maintain stakeholder buy-in of the project.
Everything in a project is iterative, including the planning and controlling of stakeholder engagement. If a stakeholder management strategy isn’t working, revisit planning and find a new way to communicate and engage the project stakeholders.
Stakeholders aren’t just the recipients of the project work. You must also work to engage the project team, vendors, and stakeholders that have little interest or influence over your project. Yes, you’ll prioritize based on power and influence, but don’t forget to keep all of the stakeholders engaged.