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Difference Between Most Confusing PMP (PMBOK) Terms

difference confusing important PMP (PMBOK) terms

PMP exam has many confusing terms. PMBOK Guide’s explanations of these terms only increases the confusion because the Guide is bereft of any examples or diagrams.

I have compiled this post to explain the difference between several confusing concepts that appear in the PMP certification test.

PMP is one of the most difficult project management exams but it can become easy if you are able to distinguish between some of the important terms.

Project vs Operations

A project is a temporary endeavor undertaken to create a unique product, service, or result.

Operations are NOT projects. They are ongoing and repetitive.

Project Assumptions vs Constraints

An assumption is something that is believed to be true but may or may not occur during the course of a project.

A project constraint is any factor that hinders or restricts the options of the project team. Constraints are different from assumptions because they limit the choices of a project team.

A constraint is generally comes because of factors that are not within the control of a project. On the other hand, the project manager is generally at liberty to assume certain things.

Project Assumptions vs Dependencies

An assumption is something that is believed to be true but may or may not occur during the course of a project.

A project dependency can be defined as an association between two activities, in which one activity requires input from the other. Dependencies are different from assumptions because they are definite and are always between two activities.

Project Assumptions vs Risks

An assumption is something that is believed to be true but may or may not occur during the course of a project.

A project risk is an uncertain event or condition that can have a positive or negative impact on at least one of the project objectives. Risks are different from assumptions because they can impact one or more project objectives. Every assumption is a potential risk because if the assumption goes wrong it can impact the project.

Project Sponsor and Customer

Sponsor is a person or a group of person who provides resources, funding, and support for the project and is accountable for enabling success.

Customer is a person(s) or organization(s) that pays for the project’s product, service, or result.

Sponsors are different from the Customers because Sponsors decide the project budget even though customer pays for the project. Sponsors are usually internal to the performing organization whereas Customers could be internal or external to the performing organization.

Project Charter and Contract

Project Charter is a document issued by the Project Sponsor to the Project Manager that formally authorizes the existence of a project and provides the authority to the Project Manager to use organizational resources for the completing the project.

A Contract is a legally binding agreement between the Buyer and Seller.

A Charter is different from the Contract because Charter is usually prepared internally within the performing organization whereas a contract is a formal document signed between two independent organizations. Unlike Contract, a Charter is usually not a legally binding document.

Project vs Program vs Portfolio

A project is a temporary endeavor undertaken to create a unique product, service, or result.

A program comprises of related projects that are managed in a coordinated manner to obtain benefits, which are not available from managing them individually.

A portfolio is a collection of projects, programs, subsidiary portfolios, and operations managed as a group to achieve strategic objectives.

You can look at the following video to understand the difference.

Project Phase vs Life Cycle

Project Phase is a collection of technically related project activities that produce one or more deliverables.

Project Life Cycle is collection of all project phases that a project project passes through from start to finish.

Project Life Cycle vs Product Life Cycle

Project Life Cycle is collection of all project phases that a project project passes through from start to finish.

Product Life cycle is the series of phases that represent the evolution of a product, from concept through delivery, growth, maturity, and to retirement.

Project Life Cycle is different from Product Life Cycle because the former it considers only one single project whereas the latter has a series project phases each resulting a new version of the product.

Enterprise Environmental Factors (EEF) vs Organizational Process Assets (OPA)

Enterprise environmental factors (EEFs) refer to conditions, not under the control of the project team, that influence, constrain, or direct the project. These conditions can be internal and/or external to the organization.

Organizational process assets (OPAs) are the plans, processes, policies, procedures, and knowledge bases specific to and used by the performing organization. These assets influence the management of the project.

Defect Repair vs Change Request

A Defect is any fault or inconsistency or imperfection that affects function(s) of a deliverable or it components.

A Defect Repair is a wilful act to modify a deliverable or its components to remove the Defects and make the deliverable conformant to the stated needs and specifications.

A Change Request is a formal documented proposal for modifying approved plans, documents, or work products.

A Defect is not a Change Request because it is a a non-conformance to the stated needs. A Defect has to be remedied and fixed.

A Defect Repair may require a Change Request because repairing defects may need additional approvals for extra time, money, or resources that are needed to mend the Defects.

Configuration Management vs Change Management

Configuration means arrangement of parts of a system.

Configuration Management deals with identification, maintenance, status reporting, and verification of configurable items.

Change Management deals with identification, impact analysis, documentation, and approving or rejecting of change requests.

Configuration Management is different from Change Management because a configurable item needs to be created before it can be changed. However, once a configurable item is created, it need not be changed.

Work Performance Data vs Work Performance Information

Work Performance Data is raw, unorganized facts that need to be processed.

When Data is processed, organized, structured or presented in a given context so as to make it useful, it is called Work Performance Information.

Work Performance Data can be something simple and seemingly random; it is useless until it is organized. Work Performance Information can be considered as processed Work Performance Data.

Project Effort vs Duration vs Elapsed Time

Effort refers to the amount of exertion or work done to complete a task.

Duration refers to the length of (working) time to complete a task.

Elapsed time is the total amount of (working and non-working) time that passes between the start of an activity and the end of the activity.

Analogous vs Parametric Estimation

Analogous Estimating is a technique that is used for estimating duration or cost of an activity or a project by using the historical data from a similar activity or project.

Parametric Estimating is a technique that is used for estimating duration or cost of an activity or a project by doing calculations on historical data and project parameters.

Analogous Estimation is usually done in the early phases when only high-level data of the current project is available whereas Parametric Estimation can be done only after detailed data of current project is available.

PERT vs Three Point Estimation

PERT Estimation Technique is one of the ways for doing Three Point Estimation. It calculates the expected duration by finding the weighted average of three different estimates viz. Optimistic (O), Pessimistic (P), and Most Likely (M).

E_PERT=(O+P+4×M)/6

Three point estimation can also be done by finding a simple average of three different estimates.

E_SA=(O+P+M)/3

Work Package vs Activity

Work Package is the work defined at the lowest level of the work breakdown structure for which cost and duration can be estimated and managed.

Activity is a distinct, scheduled portion of work performed during the course of a project.

Work  package is different from Activity because Work Package creates a deliverable or tangible output. A work package is decomposed into a sequence of activities. An activity in itself does not produce a deliverable but a sequence of activities culminates into a deliverable.

You can look at the following video to understand the difference between these project management terms.

Gantt Chart vs Network Diagram

Gantt Chart is a 2-dimensional chart horizontal bar chart in which schedule activities or WBS components are represented using bars and the length of the bar signifies their duration.

Project Schedule Network Diagram is a schedule representation technique in which boxes are used to represent schedule activities or WBS components and arrows are used to represent the logical relationships between them.

A Gantt Chart is different from Network Diagram because length of the bar in a Gantt Chart depicts the duration of the activities whereas all boxes in a Network Diagram are of standard dimension.

Project Lead vs Lag

Lead is the amount of time by which a successor activity can be advanced with respect to a predecessor activity.

Lag is the amount of time by which a successor activity is required to be delayed with respect to a predecessor activity.

Lead is different from Lag because a Lead accelerates Successor Activity whereas a Lag gives mandatory delay to the Successor Activity.

Critical Path Analysis – 0 Method vs 1 Method

In 0 Method, the work for an activity is done between the Start Period (ES or LS) and the Finish Period (EF or LF), but it does not include the Start Period.

In 1 Method, the work for an activity is done between the Start Period (ES or LS) and the Finish Period (EF or LF) inclusive of both the Periods.

Total Float vs Free Float

Total Float is the maximum amount of time an activity can be delayed without delaying the Project.

Free Float is the amount of time an activity can be delayed without impacting the Early Start date of any of its Immediate Successors.

Fast Tracking vs Crashing

Fast Tracking is a schedule compression technique in which activities or phases that are normally done in sequence are performed in parallel for at least a portion of their duration.

Crashing is a schedule compression technique that shortens the schedule duration by adding resources for the least incremental cost.

Fast Tracking is different from Crashing because it involves at least two activities whereas Crashing can be done on a single activity.

Estimate To Complete (ETC) vs Estimate At Completion (EAC)

Estimate To Complete (ETC) is the expected cost to finish remaining project work.

Estimate At Completion (EAC) is the expected total cost of completing all project work that can be expressed as the sum of the Actual Cost to date and the Estimate To Complete.

ETC is different from EAC because ETC calculates the cost of remaining project work whereas EAC calculates the cost of total project work.

You can look at the following video to understand ETC.

You can also look at the following video to understand EAC.

Cost Performance Index (CPI) vs To Complete Performance Index (TCPI)

Cost Performance Index (CPI) is the cost efficiency of the completed project work and can be calculated by finding the ratio of EV and AC (EV / AC).

To Complete Performance Index (TCPI) is the estimated cost efficiency to complete the remaining project work.

CPI is different from TCPI because CPI is the current cost efficiency of the project whereas TCPI is the future expected cost efficiency of the the project.

You can look at the following video to understand TCPI.

You can also look at the following video to understand CPI.

Quality Assurance vs Quality Control

Quality Assurance is the maintenance of a desired level of quality in a service or product, especially by means of attention to every stage of the process of delivery or production.

Quality Control is the activity of checking goods as they are produced to make sure that the final products are good

Quality Assurance is different from Quality Control because it is a means to prevent defects by following the defined process. Quality Control is used to find as many defects as possible through rigorous testing.

Accuracy vs Precision

Accuracy is the degree of exactness or correctness.

Precision is the degree to which a measurement is reproducible.

Accuracy is different from Precision because it checks how close a measured value is to the true or accepted value whereas Precision checks the consistency of repeated measurements and determines how close they are to each other.

Project Risks vs. Issues

A risk is an uncertain event or condition that, if it occurs, has a positive or negative effect on one or more project objectives.

An issue is a problem at hand.

Risks are different from Issues because Risks are uncertain in nature i.e., they may or may not occur whereas Issues are definite and certain. Issues are events that have already occurred or are currently happening.

Qualitative vs Quantitative Risk Analysis

Qualitative Risk Analysis includes examination and prioritizing of risk events by applying subjective judgment to the description, probability & impact, and urgency of the event.

Quantitative Risk Analysis is an examination of overall project risks using numerical processes such as simulation and decision tree analysis.

Qualitative Analysis is different from Quantitative Analysis because the former uses subjective elements to analyze and prioritize individual risk events whereas the latter deals with a formal numerical analysis of risks that impact overall project objectives.

Fixed Price vs Time & Material vs Cost Plus Contracts

In Fixed Price Contracts, a Fixed Amount of consideration is paid by the Buyer to the Seller for the Specified Work.

In Time & Material Contracts, a Fixed Rate is paid by the Buyer to the Seller for the Specified Unit.

In Cost Reimbursable Contracts, the Buyer reimburses actual cost of work and an agreed upon fee to the Seller for the Specified Work.

Organizational Competitors vs Project Stakeholders

A Project Stakeholder is an individual, group, or organization who may affect, be affected by, or perceive itself to be affected by a decision, activity or, an outcome of a project.

Organizational Competitors are those Organizations or Agencies or Groups that work against PM’s Organization to gain more business for themselves.

It is possible that an organizational competitor becomes a project stakeholder.

Over to You

Did you find this compilation post useful? Do you find any other set of project management terms confusion?

Please share your comments below and let me know. If required, I will update this post with new terms.

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