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Opinion: Redefining Your Performance Management Systems and Processes

In today’s hyper-competitive world, what is it that differentiates a good company from an outstanding company? You may have the best technology and infrastructure in place, but without sincere and inspired performances from your employees, you will soon fall behind. Your people are the backbone of your company, and their performance is the critical differentiator for survival in the industry. Establishing the Right Performance Management Systems Every organisation needs to have performance management systems that can promote and nurture employee effectiveness. When employees are encouraged to perform better, the employee engagement will be higher and attrition rates will decrease – leading to overall growth and enhanced productivity. A 2013 Gallup poll that reviewed employee engagement data from over 50,000 employees working in 22 global companies showed that over half the employees felt their company’s performance management did not hit the mark. If you feel that your workers are disgruntled, not performing to their peak efficiency and are looking for other job options, then maybe the HR Department needs to take a fresh look at the performance management processes and practices that are currently being followed. Reflect on these points: 1) Do you have a positive and supportive work environment, where the managers and team are all on the same page? 2) When there is an urgent deadline, does everyone pitch in wholeheartedly and work overtime, or do you have people passing the buck and trying to escape their responsibilities? 3) Do a majority of the projects undertaken end on a positive note, on time and within budget? 4) Is the rate of employee attrition higher than the norm? To set up a new performance management system, you should ideally set up a small committee that represents board members, employees and managers and create understanding and support for the process. Your people are the key, and building up a rapport between team members and managers will result in great team work and superior performances. Once the planning and schedules are worked out, you must communicate the new processes and values to every employee before implementation. Improving employee effectiveness Quite often, the most difficult part of the planning process is in outlining job objectives and delineating indicators of success. Where do we start measuring the quality of performances, and what do we benchmark these against? A performance evaluation or appraisal needs to be carried out once a year for each employee, where a fair assessment is carried out of his or her achievements, and the managers give constructive feedback for growth as well as extend praise wherever it is needed. By reviewing, planning and chalking out yearly goals and objectives, each employee can enhance his or her contribution towards the organisation. They should be made to understand that the new system and appraisals are primarily to help them to develop their core capabilities, not merely to monitor salary hikes or promotions at work. Such appraisals go a long way toward making each employee feel valued, and feel that they are a part of the overall vision of the company. Recognition for good performances motivates and inspires employees to push themselves to perform even better. Constructive feedback helps people to understand where they stand in the eyes of the management, and how they can improve themselves in order to achieve more personally and professionally. Tracking overall performances through KPIs Many organisations face challenges in quantifying improvement and growth. This is where Key Performance Indicators play an important role.  It is not always easy to evaluate whether your business is on the right growth track or not. Keeping aside normal declines due to a sluggish market, if your business is not looking up over several quarters, then a systematic evaluation is needed to identify the sectors that need improvement – and this is where KPIs play an integral role. KPIs are measures that indicate and measure your organisation’s alignment with the overall business strategy or goals. At the start of the year, it would be good practice to set in place KPIs for each department and even each team. They serve to define objectives and goals to be achieved, and help to ensure that everyone is on the right track to create greater value and achieve business excellence. Communication is the key To increase employee performances and organisational productivity, clearly communicated performance indicators should be defined and reiterated time and again by managers to their teams. Communication is the key and employee expectations should be laid out in a performance appraisal at least once, if not several times a year. This activity should focus on employee strengths rather than their failures, in order to encourage them to work better and achieve their full potential. The best managers are those who are able to empower and engage their teams and help them work together in cohesion and collaboration. To sum up, performance management is more than just plans and periodic reviews. It should be a continuous process that redefines organisational goals, assesses progress and evaluates performances to ensure that they are in line with the overall vision.

Opinion: Redefining Your Performance Management Systems and Processes

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Opinion: Redefining Your Performance Management Systems and Processes

In today’s hyper-competitive world, what is it that differentiates a good company from an outstanding company? You may have the best technology and infrastructure in place, but without sincere and inspired performances from your employees, you will soon fall behind. Your people are the backbone of your company, and their performance is the critical differentiator for survival in the industry.

Establishing the Right Performance Management Systems

Every organisation needs to have performance management systems that can promote and nurture employee effectiveness. When employees are encouraged to perform better, the employee engagement will be higher and attrition rates will decrease – leading to overall growth and enhanced productivity. A 2013 Gallup poll that reviewed employee engagement data from over 50,000 employees working in 22 global companies showed that over half the employees felt their company’s performance management did not hit the mark.

If you feel that your workers are disgruntled, not performing to their peak efficiency and are looking for other job options, then maybe the HR Department needs to take a fresh look at the performance management processes and practices that are currently being followed. Reflect on these points:

1) Do you have a positive and supportive work environment, where the managers and team are all on the same page?

2) When there is an urgent deadline, does everyone pitch in wholeheartedly and work overtime, or do you have people passing the buck and trying to escape their responsibilities?

3) Do a majority of the projects undertaken end on a positive note, on time and within budget?

4) Is the rate of employee attrition higher than the norm?

To set up a new performance management system, you should ideally set up a small committee that represents board members, employees and managers and create understanding and support for the process. Your people are the key, and building up a rapport between team members and managers will result in great team work and superior performances.

Once the planning and schedules are worked out, you must communicate the new processes and values to every employee before implementation.

Improving employee effectiveness

Quite often, the most difficult part of the planning process is in outlining job objectives and delineating indicators of success. Where do we start measuring the quality of performances, and what do we benchmark these against?

A performance evaluation or appraisal needs to be carried out once a year for each employee, where a fair assessment is carried out of his or her achievements, and the managers give constructive feedback for growth as well as extend praise wherever it is needed. By reviewing, planning and chalking out yearly goals and objectives, each employee can enhance his or her contribution towards the organisation. They should be made to understand that the new system and appraisals are primarily to help them to develop their core capabilities, not merely to monitor salary hikes or promotions at work.

Such appraisals go a long way toward making each employee feel valued, and feel that they are a part of the overall vision of the company. Recognition for good performances motivates and inspires employees to push themselves to perform even better. Constructive feedback helps people to understand where they stand in the eyes of the management, and how they can improve themselves in order to achieve more personally and professionally.

Tracking overall performances through KPIs

Many organisations face challenges in quantifying improvement and growth. This is where Key Performance Indicators play an important role.  It is not always easy to evaluate whether your business is on the right growth track or not. Keeping aside normal declines due to a sluggish market, if your business is not looking up over several quarters, then a systematic evaluation is needed to identify the sectors that need improvement – and this is where KPIs play an integral role.

KPIs are measures that indicate and measure your organisation’s alignment with the overall business strategy or goals. At the start of the year, it would be good practice to set in place KPIs for each department and even each team. They serve to define objectives and goals to be achieved, and help to ensure that everyone is on the right track to create greater value and achieve business excellence.

Communication is the key

To increase employee performances and organisational productivity, clearly communicated performance indicators should be defined and reiterated time and again by managers to their teams. Communication is the key and employee expectations should be laid out in a performance appraisal at least once, if not several times a year. This activity should focus on employee strengths rather than their failures, in order to encourage them to work better and achieve their full potential. The best managers are those who are able to empower and engage their teams and help them work together in cohesion and collaboration.

To sum up, performance management is more than just plans and periodic reviews. It should be a continuous process that redefines organisational goals, assesses progress and evaluates performances to ensure that they are in line with the overall vision.

Usha

Usha Sunil

Blog Author

Writing is Usha's hobby and passion. She has written widely on topics as diverse as training, finance, HR and marketing, and is now into technical writing and education. She keeps an interested eye on new trends in technology, and is currently on a mission to find out what makes the world go around.

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Best Project Management Certifications in 2021

While nothing can replace industry work experience, there is no doubt that a credible certification can open up new opportunities and elevate your current profile. This is true for any area of work and more so in the project management field.With projects getting more complex, pan global and resource intensive, organizations look to hire project managers who come with solid expertise and a recognised certification to back their knowledge and skill.With so many project management credentials to choose from, which one would suit you best in terms of the knowledge and opportunities you will gain? Here is a ready compilation of the best Project Management Certifications for 2021, to help you to make an informed decision.PMP® Certification TrainingCAPM® Certification TrainingPMI-RMP® Certification TrainingPRINCE2® Foundation and Practitioner Certification TrainingProgram Management Professional (PgMP)® Certification TrainingPMI-ACP® Certification Training1. Project Management Professional (PMP)®Arguably the most well-known credential in the Project Management space, the PMP is globally recognized as the gold standard in project management. Offered by the Project Management Institute (PMI)®, the PMP gives you the bandwidth to work in any industry, using any methodology and working on a variety of situations.This certification is a litmus test of your project management knowledge and skills in managing the project "triple constraints", that is time, cost, and scope. And with its new rollout, the PMP helps holders grow and develop diverse project management skills to suit the fast-changing markets of today and beyond.PMP DemandThe reason why PMP is so well received is because the skills one learns during the PMP certification journey can be applied across sectors, geographies and industries including IT, government sectors, telecommunications, manufacturing, banking and more.It allows certified professionals to maximise value, enhance bottom line margins and prove that they can drive business results.PMP continues to remain one among the best Project Management Certifications for 2021.Benefits of getting PMP certifiedValidate your commitment to continued excellence and qualityDemonstrate your proficiency in project managementGrow your career in project management with confidenceManage projects across sectors and industriesGet yourself hired by the bestEarn salaries that are up to 58% higher than those who do not hold the certificationEarn salaries up to $145,000Top companies that hire PMP professionalsExxon MobileAppleSAICEXELONWhere to take training for certification: Aspirants must undertake the training from an Authorized Training Provider of PMI®.Who should take the training for certification:Mid-Level, Senior Project ManagersProject CoordinatorsProject AnalystsProject LeadersProduct ManagersProgram ManagersProject SponsorsTeam LeadersAnyone interesting in building project management skillsEligibility for PMP examTo be eligible for the PMP® exam, you must fulfill the following criteriaEDUCATIONAL BACKGROUNDSecondary Degree (high school diploma, associate’s degree or global equivalent), ORFour-year Degree (bachelor’s degree or global equivalent), ORBachelor's or Post-Graduate degree from a GAC accredited program (bachelor’s degree or master's or global equivalent).PROJECT MANAGEMENT EXPERIENCEMinimum five years/60 months unique non-overlapping professional project management experience, ORMinimum three years/36 months unique non-overlapping professional project management experience, ORMinimum two years/24 months unique non-overlapping professional project management experience.PROJECT MANAGEMENT EDUCATION35 contact hours of formal education, unless you are an active CAPM holder.Exam FormatThe latest (2021) PMP® certification exam pattern is as follows:No of questions: 180 multiple-choice, multiple responses, matching, hotspot and limited fill-in-the-blank.Time: 230 minutesDifficulty level: The questions are populated as per the difficulty level. The questions are randomized so that no two candidates will get similar questions. The easier the question, the higher the passing score determinant and the higher or tougher the question, the easier the passing score. Duration to get certified: After completing your 35 hours of PMP workshop training, you need to rigorously prepare for the exam. Experts suggest dedicating several weeks to studying for the exam to ensure thorough preparation. Your web-based exam results will be visible to you immediately upon completion of the exam.Course fee for certification: In India: INR 14999, America: USD 999, Canada: CAD 1399Application fee: For PMI membership: USD $ 129 plus USD $10 for application fee.Exam fee for certification:In IndiaMember: ₹23,459.00 Non-member: ₹42,863.00In US Member: $405Non-member: $555Retake fee for certificationMember: $275Non-member:$3752. CAPM®: Certified Associate in Project Management Yet another offering from the PMI, the CAPM is a foundational credential that reflects the holder’s expertise in defining and managing new age project management tools and techniques. Based on the PMBOK® Guide-Sixth Edition, the CAPM will help you stand out among non-certified project managers and showcase your proficiency in implementing global project management best practices.  CAPM Demand: The CAPM certifies the holder as being adept in project management practices. An organization having a pool of CAPM qualified professionals has a good reputation and standing in the market. Owing to the benefits that they bring in, CAPM practitioners are much in demand.Benefits of getting CAPM certifiedLearn the right skills in project managementGain insights into project executing, monitoring, controlling and managementBe thorough in estimating project activity costsAchieve quality management and quality assurance at every stageMaster global project management best practicesOpen yourself to new opportunities and lucrative job offersEnhance your market credibility  Gain 23 contact hours/PDUsBe part of the PMI network and gain several benefitsEarn average salaries from $93,500 to $111,500Top companies that hire CAPM professionalsKaiser PermanateAecom CorporationSAP AmericaBooz, Allen, HamiltonInternational Business Machines (IBM) CorpWhere to take training for certification: Aspirants must train from an Authorized Training Partner (ATP) of PMI.Who should take the training for certificationAssociate Project ManagersProject ManagersIT Project ManagersProject CoordinatorsProject Analysts, Project LeadersSenior Project ManagersTeam LeadersProduct ManagersProgram ManagersProject SponsorsProject Team MembersEligibilitySecondary degree (high school diploma, associate’s degree or the global equivalent)23 hours of project management education completed by the time you sit for the examExam FormatNo of questions: 150 questions Time: 3 hoursDifficulty level: Moderate but requires thorough knowledge of project management principlesDuration to get certified: After completing your 23 hours of CAPM workshop training, you need to dedicate around 45-60 hours to ensure complete preparation for the exam. Your web-based exam results will be visible to you immediately upon completion of the exam.  Course fee for certification: INR 8999, USD 799Application fee for certification: For PMI membership: USD $ 129 plus USD $10 for application fee.Exam fee for certification:In IndiaMember: ₹17,377.00Non-member: ₹23,169.00In U.S.Member: $435Non-member: $4953. PMI-RMP®: Project Management Institute-Risk Management ProfessionalThe pandemic exposed many vulnerabilities that organizations had not been prepared for. When faced with unprecedented risks, organizations need specialists who can identify and assess project risks, mitigate threats and take advantage of opportunities. The PMI-RMP course and certification prepares professionals to perform this role and successfully steer projects in complex environments.PMI-RMP Demand: According to the 2015 Pulse of the Profession® by PMI, “Eighty-three percent of organizations that are high performers in project management practice risk management frequently while just 49 percent of low performers do so”. This shows the importance of risk management and the emphasis organizations place on qualified risk managers.Benefits of getting PMI-RMP certifiedApply risk management practices for greater competitive advantageIdentify and measure risks in project development and implementationQuantify and create risk response strategies to deliver products that meet stakeholder expectationsUse a proactive and focused approach to preventing problems, rather than dealing with them once they occurIncrease your visibility within the companyAim for greater career growthEarn salaries upto $115,931Top companies that hire PMI-RMP professionalsWhere to take training for certification: Aspirants must train from an Authorized Training Partner (ATP) of PMI.Who should take the training for certificationRisk ManagersRisk Management ProfessionalsProject ManagersProject SponsorsProgram ManagersProject EngineersProject CoordinatorsPlanning ManagersPlanning EngineersProject Cost Control EngineersQuantity SurveyorsCivil EngineersIT Project ManagersProduct ManagersProject AnalystsBusiness AnalystsProject LeadersProject Co-ordinatorsTeam LeadersTeam MembersEligibilityTo apply for the PMI-RMP® Credential, you need to possess a:Secondary degree (high school diploma, associate’s degree, or the global equivalent)4,500 hours of project risk management experience40 hours of project risk management educationORFour-year degree (bachelor’s degree or the global equivalent)3,000 hours of project risk management experience30 hours of project risk management educationExam FormatNo of questions: 170 questions Type: Multiple ChoiceTime: 3.5 hoursDuration to get certifiedApplication fee: For PMI membership: USD $ 129 plus USD $10 for application fee.Course fee for certification: INR12999, USD 999Exam fee for certificationIn U.S.Member: $520Non-member: $670Retake fee for certificationMember: $335Non-member: $4354. PRINCE2® Foundation/PRINCE2 PractitionerThe PRINCE2 (PRojects IN Controlled Environments) Foundation and Practitioner credentials are sought-after offerings from AXELOS. There are a number of credentials offered under PRINCE2 that make it suitable for a wider audience. Axelos keeps the PRINCE2 curriculum regularly updated with the latest industry advances, which makes it suitable for new age project management and intensive, demanding projects.  PRINCE2 Demand: PRINCE2 extends its applicability across industries and sectors. This makes it very popular in the market as it is a one size fits all model. Although PRINCE2 was founded in the UK, it has now firmly established its presence in industries across the world. According to a report in LinkedIn, PRINCE2 is the most popular project management methodology. A professional adept at PRINCE2 and holding the credential is highly valuable and sought after by organizations implementing PRINCE2 for their projects.  Benefits of getting PRINCE2 certifiedGuide projects in their entiretyTailor PRINCE2 to suit the needs of projects and organizationsValidate your commitment to continued excellence and quality  Master and demonstrate your proficiency of the PRINCE2® framework  Gain project management best practices and grow your career with confidence Work across projects in diverse sectors and industriesShow your ability to work in challenging work environments  Command higher salaries (upto $99,012 average) than your non-certified peers Top companies that hire PRINCE2 professionalsShellBPTranspower New ZealandIBMHPAquasoftGetronicsSiemensWhere to take training for certification: Aspirants must undertake training from a Certified Partner of AXELOS and an accredited training organization (ATO) with PeopleCert®.Who should take the training for certification?Project ManagersProject CoordinatorsProject AnalystsProject LeadersProduct ManagersProgram ManagersProject SponsorsTeam LeadersSenior Responsible OwnersProduct Delivery ManagersBusiness Change AnalystsProject and Programme Office PersonnelOperational Line ManagerAnyone who wishes to build up knowledge in project management EligibilityThere are no eligibility requirements for the PRINCE2® Foundation certification exam. To qualify for the PRINCE2 Practitioner exam, you must have at least one of the following certifications: PRINCE2® Foundation or higher (applicable only to certificates obtained after 1 January 2009) Project Management Professional (PMP)® Certified Associate in Project Management (CAPM)® IPMA Level A® (Certified Projects Director) IPMA Level B® (Certified Senior Project Manager) IPMA Level C® (Certified Project Manager) IPMA Level D® (Certified Project Management Associate) Project Management Qualification (PMQ) Project Professional Qualification (PPQ) Exam FormatFoundation ExamDuration: 60 minutes (1 hour) Questions: 60 Multiple choice questions Pass mark: 33 out of 60 available, or 55% Use of textbook: No, it’s a closed book examPractitioner Exam Duration: 150 minutes (2.5 hrs) Questions: 68 Objective type questions Pass mark: 38 out of 68 available, or 55% Use of textbook: Yes, but only the official PRINCE2® manual is permitted. Duration to get certifiedYou will need to attend 32-hours of PRINCE2® Foundation and Practitioner training from an ATO of AXELOS and PeopleCert®, following which you will be required to take the exams to demonstrate your knowledge of PRINCE2 and get certified. The results of your tests are issued within 2 business days from the date of your exam.  Course fee for certification: USD 1999Exam fee for certification: Included in course fee5.  PgMP®: Program Management Professional (PgMP)® Certification TrainingAnother project management from the PMI, this credential is more advanced than the PMP and certifies the holder’s ability to manage complex projects that cover functions, organizations, cultures and geographies. The credential mandates holders to be proficient in the six prime focus areas: Governance, Prioritization, Escalation, Resource Management, Benefits Realization, and Stakeholder Management.PgMP Demand: Credentials from the PMI are known for their rigorous standards and testing, which is why they are well accepted in industries across sectors. PgMP holders are better able to promote integration and coordination of multiple projects for the overall benefit of the program. According to PMI’s 2015 Pulse of the Profession® report, an organization’s projects are far more successful with program management than without it — 76 percent compared to 54 percent. This further compounds the demand for PgMP professionals. Benefits of getting PgMP certifiedGet in-depth knowledge of tools and techniques to handle complex multiple related projectsUnderstand Program Lifecycle and its processes, competencies, tools and techniques with practical sample templatesLearn to implement large-scale programs to align with business strategyOpen yourself to lucrative job opportunities and leadership rolesWork in projects across geographiesEarn high salaries, upto $139,000 on averageTop companies that hire PgMP professionalsAmazonGoogleMicrosoftCognizantCapgeminiDeloitteJP Morgan ChaseErnst & YoungWhere to take training for certification: Aspirants must train from an Authorized Training Provider of PMI®Who should take the training for certificationTeam LeadsSponsorsProject DirectorsProgram ManagersPortfolio Managers  Project Management Office (PMO) HeadsEligibilityA Four-year Degree (Bachelor's or Global equivalent), with at least four years of Project Management experience and four years of Program Management experience.ORA Secondary Diploma (High school or Global equivalent), with at least four years of Project Management experience and seven years of Program Management experience. Exam FormatNo of questions: 170 multiple-choice, of which 20 are considered pretest questions which are not scored.Question type: Most questions are scenario based and test a professional's understanding and clarity of thoughts on different Program Management concepts.Time: 4 hoursDifficulty level: DifficultDuration to get certified: You have to complete your 24 hours of training from an Authorized Training Partner (ATP) of PMI. Make a study plan and stick to it religiously. The PgMP is considered to be more difficult than the PMP and requires a fair bit of preparation. Once you pass the 4-hour exam you will be PgMP certified.  Course fee for certification: INR 13,999; USD 1199Application fee for certification: For PMI membership: USD $ 129 plus USD $10 for application fee.Exam fee for certificationIn IndiaMember: ₹46,338.00Non-member: ₹77,230.00In U.S.Member: $800Non-member: $1000Retake fee for certificationMember: $600Non-member: $8006. PMI-ACPPMI-ACP Demand: Agile is a fairly new concept in the context of product development. Though organizations reap immense benefits by adopting Agile, the road to transformation can often turn out to be expensive if not well executed. PMI-ACP professionals are therefore in huge demand as they can bring in project management best practices in Agile environments and ensure project success.  Benefits of getting PMI-ACP certifiedThe shortage of Project Managers has increased job opportunities in the Agile environmentYou will qualify for Agile jobs with expertise in Agile methods like Scrum, FDD, Kanban, etc. which are in demand in the industryEarn salaries in the range of $108,000 on an averageEquips you with knowledge of various Agile methodsMakes you more marketableTop companies that hire PMI-ACP professionalsStandard CharteredOracleIBMVMWareSource: IndeedWhere to take training for certification: Aspirants must train from an Authorized Training Provider of PMI® Who should take the training for certification?Project ManagersProject PlannersQuality Assurance StaffDevelopers/ProgrammersDesigners, TestersProject ControllersProduct OwnersScrum MastersScrum Team MembersEligibilityTo apply for the PMI-ACP®, candidates must meet the following requirements:1. General Project Experience2000 hours of working on project teams within the last 5 years or having an active PMP®/PgMP® credential2. Agile Project Experience1500 hours of working on Agile Project Teams or with Agile Methodologies, in addition to “General Project Experience” above;3. Training in Agile Practices21 contact hours earned in Agile PracticesExam FormatNo of questions: 120 MCQ, of which 20 are pre-testDuration: 3 hoursDuration to get certified: Once you complete the course, you need to schedule the exam date. Exam applications have to be submitted and approved by PMI. Online applications m ay take upto five business days to get processed. Once your application is processed, you can schedule your exam date, and on passing receive the PMI-ACP credential.Course fee for certification: INR 10,999, USD 1099Application fee for certification: For PMI membership: USD $ 129 plus USD $10 for application fee.Exam fee for certificationFor members: $435Non-members: $495Retake fee for certificationMembers: $150Non-members: $200SummaryProject Management is among the most sought after job roles, not only in the tech industry but any industry that executes and manages projects. By 2027, 88 million individuals will need to be skilled in project management-oriented roles. This makes it among the hottest job trends in the coming years, and a credential will go a long way in helping you capitalise on this trend.
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Best Project Management Certifications in 2021

While nothing can replace industry work experience... Read More

Project Contracts – A Vital Legal Binding

One of the key knowledge areas discussed in the Project Management Professional (PMP®) certification is Procurements Management. As part of project procurements management a project manager is mainly expected to be able to initiate, execute and manage projects based on the project contracts. This article is an attempt to discuss about project contracts, to discuss the importance of such contracts and to give an introduction to types of contracts as a precursor to subsequent articles. The PMBOK® defines a contract as follows. “Contract represents a mutually binding agreement that obligates the seller to provide the specified products, services or results, and obligates the buyer to provide the monetary or other valuable consideration in return. A contract can also be called an agreement, understanding, undertaking or a purchase order.” (PMBOK® 5.0) Any project involves two or more parties. One main party that is the buyer and the other the seller. In addition to these there can be other 3rd party elements that are not directly involved in the contract but are interested in or are impacted by the same. The contract between the buyer and the seller happens to protect the interests of the two parties entering into the agreement. The seller provides goods or services to the buyer for which the buyer compensates the seller monetarily or through other financial or non-financial means.   A contract is a formal agreement between the two parties and it is a legal binding amongst the two entities. A formal contract must be in written format and can be used even in court of law in the case of either party failing to honour their commitment or in the case of an appeal against any misdeeds. Dishonouring contracts may actually lead to settlements even in court but should ideally be settled mutually among the disagreeing parties, most probably through a mediator called an ‘arbitrator’. Normally in large organizations contracts are managed by a separate contract manager or a procurements manager. The management of contracts are done in 2 separate ways namely; centralized contracting and decentralized contracting. In centralized contracting, one contract manager manages all the contract related matters for multiple projects. This requires expertise in contracting, standardization of contracting practices across the organization and more focused management of contracts. In decentralized contracting, separate contract managers are allocated to manage the procurements for individual projects. This results in full time management of contracts and the contract manager must report progress to the project manager. This results in more focused management of project contracts and with time creates specialized expertise in contracting. However, this may result in duplication of contracting expertise and less standardization of contracting practices across multiple projects in the company. There are three main types of contracts. They are Cost Reimbursable OR Cost Plus, Time and Material or Unit Price and Fixed Price or Lump Sum contracts.  The applicability and use of these contract types based on the type of project, complexity and the parties involved may decide on variations based on the charges involved in order to ensure that the contract terms are mutually beneficial for the two parties. Hence, these contracts vary based on the cost, time and price.  A cost plus or cost reimbursement contract is a contract in which the contractor is reimbursed or paid all the actual expenses they incur when carrying out the work. In addition to this they are also allowed to charge an extra fee allowing them to obtain a profit. For example a contractor taking up building a contract may claim resource costs as well as any miscellaneous expenses incurred for travel, food, purchases as well as charge an additional amount from the customer in order to make a profit from the tasks carried out. A fixed price contract on the other hand does not depend on the resources utilized or time expended. A fixed amount is agreed upon between the contractor and the customer where the amount is paid to the contractor even if the resources expended is lower or higher than the agreed upon amount. Time & material contract is where the contracting party is paid only for the amount of time or resources spent. For example if there is a software development firm which assigns 4 resources for a project on a T&M basis the company will be paid an hourly rate for each resource based on the amount of time they spend on tasks in the project.  Each contract type has its own pros and cons for both the contracting and implementation party. For example a fixed price contract is suitable for an organization as they would know the amount due before hand and know that they won’t end up paying extra if the triple project constraints are not met. Similarly, a time and material project may be suitable for both parties, as amount will be charged only based on the amount of work done in the project and for the time spent. Advantages and disadvantages of each contract type depend on the context. Thus, it is important for stakeholders involved in projects to negotiate on contracts wisely.
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Project Contracts – A Vital Legal Binding

One of the key knowledge areas discussed in the Pr... Read More

How much does a PMP® Certification cost?

 Are you planning to take the PMP® certification exam soon? If yes, you should take the next step by starting with the application process. But before that, you need to have a clear idea about the costs which are included in the process of getting PMP® certified.  PMP® is considered as one of the most valuable and high demand certifications in the project management category. Having a PMP® certification under your belt will introduce you to the world of greater opportunity and lucrative salaries. But PMP® is a tougher exam compared to other certifications and requires more preparation to pass the exam.There are multiple items to consider when you try to find out the cost involved in the PMP® certification process. The PMP® certification costs include the application and exam fees plus any other additional costs associated with preparing for the exam.It is not just about the PMP® Exam feeYou need to pay an amount of $555 as the exam fee to sit for your PMP® certification exam. But you can bring it down to $405 by becoming a PMI member. But this is not the only cost involved in the PMP® certification cost. The costs can further be explained in the following points:1. Become a PMI member:It is not necessary for you to become a PMI member to sit for your PMP® certification exam. But the benefits of getting a membership with PMI is more than the membership fee. The annual membership fee along with the first time registration fee is $139. You can save $150 on the exam fee itself by becoming a PMI member.Apart from the exam fee, you get a free copy of the latest edition of PMBOK® Guide and other standards or guides published by PMI which you need to be thorough with in order to pass the PMP® examination. Further, you can gain the required PMP® PDUs for free by watching the webinars and joining the annual online conferences which are exclusively available for the members.2. PMP® certification exam fee:Once you become a PMI member, you need to pay $405 as the PMP® certification exam fee to take the computer-based exam at your nearest Prometric exam center. But it is $555 for non-members.You can take up the PMP® certification exam three times in the one-year eligibility period. Again, if you are a PMI member, you just need to pay a PMP® re-examination fee of $275 whereas, the non-members need to pay $375.3. PMBOK® Guide:As a PMP® aspirant, you shouldn’t consider only the PMBOK® Guide to be the syllabus of PMP® exam. It is an official reference book for the PMP® exam. It is recommended for every aspirant to read the PMBOK® Guide more than once while you prepare for your PMP® exam. The content of the PMBOK® Guide can be found in the real PMP® exam. The current cost of PMBOK® Guide is $47.98.Got a PMI membership? Then you can download the free copy of the PMBOK® Guide from the PMI website.4. Earning 35 contact hours by attending the Project Management Training Course:You need to complete 35 hours of project management course work to sit for the PMP® exam. Taking up a Project Management Training Course can help you to earn these 35 contact hours. The cost of these courses ranges based on the training provider. You need to spend around $1,000 to meet this requirement.5. PMP® exam reference books:As you know that PMP® certification exam consists of a complex exam pattern and you need to be well prepared to clear it at one go. You can get access to reference books both in hard copy and online. These resources contain tons of project management knowledge which proves helpful while you prepare for your PMP® exam.6. Practice Exams and Mock Tests:Taking PMP® sample exams plays a pivotal role in your PMP® exam preparation. These mock tests and practice exams prove as a good resource to test your readiness for the exam. Further, these mock tests will help you understand the techniques of time management which is an important factor while writing your PMP® certification exam.7.Renewing your credentials:You can’t stop your quest once you get your PMP® certification. Your PMP® certification is only valid for three years and you need to renew your credentials before it gets invalid. So, you need to pay $150 to renew your credential every three years. However, you can bring down this cost to $60 by becoming a PMI member.Confused? The following chart will help you to get a clear understanding of the costs involved in your PMP® certification:Sl. No.PMP® Certification Cost (Different Cost Aspects)Costs1PMI Membership fee along with joining fee$1392PMI Membership renewal fee$129 per year3PMP® Certification Exam fee for PMI members$4054PMP® Certification Exam fee for non-members$5555Rescheduling fee for PMI members$2756Rescheduling fee for non-members$3757PMBOK® handbook cost for membersFree8PMBOK® handbook cost for non-members$50 on Amazon9Cost of study guides and resources$40 to $10010Cost of practice tests$60 to $10011Renewal cost of PMP® certification for PMI members$6012Renewal cost of PMP® certification for non-members$150Online PMP® trainingWon’t it be great if you get access to PMP® certification training from your preferred location? You can make it possible by opting for online PMP® certification training. The e-learning course provided by the R.E.P.s give you access to innumerable mock tests and exam revisions. Few of the features of such courses are as follows:35 PDUs on completion of 35 hours of e-learning15 audio-visual modules covering all course topics from PMBOK® Guide13 hours of online contentPMP® eBook in downloadable format and PMP® exam blueprintA question bank on all knowledge areasTips and tricks to pass PMP® in the first attempt.PMI Talent Triangle™ BundleYou need to continue your learning and development in order to maintain your PMP® certification. The PMI® has set a 60 PDU requirement which you are expected to meet in order to continue your PMP® journey. As a PMP® certification aspirant, won’t you be happy to get all the course which you need to fulfill your PDU requirements in a bundle? You need to earn 35 PDUs in the Education category and meet the following minimum requirements, as per the PMI Talent Triangle™  skill areas:Education PDUs - Minimum Talent Triangle RequirementsCertificationTechnical PDUs RequiredLeadership PDUs RequiredStrategic PDUs RequiredRemaining PDUs - across any area of PMI Talent TriangleTotal Minimum RequiredPMP8881135The activities and courses included in the three components of the PMI Talent Triangle™ are as follows:TechnicalLeadershipBusiness & Strategic ManagementLife Cycle ManagementCoaching & MentoringCustomer relationship & satisfactionTime, Scope, Risk ManagementProblem SolvingBenefits RealisationEstimationTeam BuildingLegal & Regulatory complianceAgile PracticesEmotional IntelligenceStrategic planning & analysisGovernanceConflict ManagementOperational FunctionsData gathering and modelingBrainstormingBusiness acumenEarned value managementInfluencingCompetitive analysisPerformance ManagementListeningMarket awarenessInterpersonal skillsBusiness models and structuresThe best way to earn 35 contact hours of PMP® trainingYou can get access to PMP® certification training in three different methods. They are classroom training, instructor-led training, and self-learning method. All the mentioned modes have their own pros and cons, but self-learning is considered as the cheapest of all the three courses.You can choose between self-learning mode or instructor-led mode to take your online training. There are numerous R.E.P.s in the market who provide such training and help you attain 35 contact hours to fulfill the PMI requirements.You should consider the following important factors while searching for the best online platform for your PMP® certification training:Is the training provider a registered training body?Will you be provided with 35 hours certificate?Is the training provided in English?What is the duration of the eLearning access?Salary of a PMP® certified professionalAfter knowing about all the costs which you need to bear in order to get PMP® certified, won’t you love to know about what lies ahead of it? Here are five jobs for project management professionals in the US with the highest paid salaries.1. Pharmaceutical project management professionalA Pharmaceutical Project Manager works with researchers, doctors, and engineers to ensure that the research and development stay on schedule and on budget. He or she is responsible for overseeing the development of new medication for the treatment of diseases and other health problems. The average annual salary of a Pharmaceutical Project Manager based in the US is $131,833.2. Resources project management professionalA Resources Project Manager works toward making the process of extracting and growing natural resources by working with farmers, mining, and oil companies and eliminating waste as well as improving communication. He or she looks into the procurement of natural resources for efficient delivery to end consumers. The average annual salary of the Resources Project Manager based in the US is around $129,368.3. Consulting project management professionalFrom environmental engineers to sales managers, a Consulting Project Manager works at all the levels of the industry and they work on a case-to-case basis. He or she works with the goal to furnish industry expertise and advanced knowledge to the client in order to lead their project to success. A Consulting Project Manager earns an annual average salary of $129,208 in the US.4. Aerospace project management professionalThe job description of an Aerospace Project Manager includes working with designers and engineers to ensure the delivery of the new aircraft on time and on budget. His or her focus areas include quality control and risk management. The average annual salary of the Aerospace Project Manager based in the US is $121,923.5. Engineering project management professionalAn Engineering Project Manager communicates with clients to ensure the quality of the end product as demanded by the client. The annual salary of the Engineering Project Manager based in the US is $121,769 per annum.To concludeAs you can see, the PMP® certification involves a lot of other costs other than the exam cost itself. There is a cost involved in all the processes which you need to go through in order to get PMP® certified. But these costs can vary from person to person and the country you are residing in. Further, adding a PMP® certification to your collar exposes you to better career opportunities and higher salaries.
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