April 2000
PM217 : PROJECT MANAGEMENT

QUESTION 1 (Compulsory)

Total Marks: 30 Marks

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SUGGESTED SOLUTIONS
for Question 1

(a)Consider the following statements:
(i)project management must be customer-focused ;
(ii)a good project manager should be skilled in the use of appropriate management tools ;
(iii)we must empower project managers if they are to operate effectively.
Expand briefly upon each statement,explaining exactly what the statement
means.[6 marks ]

(b)The management of risk is an important part of project management.
(i)What are the main sources of risk on a typical project?[2 marks ]
(ii)How can historical data be used in risk management?[2 marks ]
(iii)What strategies can be adopted for coping with,or reducing the impact of,
identified risks?[2 marks ]

(c)Requirements definition can involve the following four activities:
(i)learning about the customer organisation
(ii)identifying multiple customers and prioritizing needs
(iii)establishing a task force to assist in defining needs
(iv)educating the customer
In each case,describe briefly what the project personnel or analysts would be
expected to do,and explain why the activity is important.[12 marks ]

(d)Contracts for project work may be structured as fixed-price contracts or cost-plus contracts.
(i)Which form of contract is likely to involve higher administrative costs?Explain your answer.[3 marks ]
(ii)Which form of contract is more appropriate for a high-risk development project? Explain your answer.[3 marks ]