Sunday, June 3, 2012

Understanding contract terms

There are several specific terms within a contract. Here are a few that may help you more easily understand your next agency contract.

Scope statement: The scope statement provides a documented basis for making future project decisions and for confirming or developing common understanding of project scope among the stakeholders. As the project progresses, the scope statement may need to be revised or refined to reflect approved changes to the scope of the project.

Responsibility assignment matrix (RAM): A structure that relates the project organization structure to the work breakdown structure to help ensure that each element of the projects scope of work is assigned to a responsible individual.

Work breakdown structure: A deliverable-oriented grouping of project elements that organizes and defines the total work scope of the project. Each descending level represents an increasingly detailed definition of the project work.

Project plan: A formal, approved document used to guide both project execution and project control. The primary uses of the project plan are to document planning assumptions and decisions, facilitate communication among stakeholders, and document approved scope, cost, and schedule baselines. A project plan may be summary or detailed.

Critical Path: The series of activities that determines the duration of the project. In a deterministic model, the critical path is usually defined as those activities with float (the amount of time that an activity may be delayed form its early start without delaying the project finish date) less than or equal to a specified value. It is the longest path through the project.

Assumptions: Assumptions are factors that, for planning purposes, are considered to be true, real, or certain. Assumptions affect all aspects of project planning and are part of the progressive elaboration of the project. Project teams frequently identify, document and validate assumptions as part of their planning process. Assumptions generally involve a degree of risk.

© 2000 Project Management Institution, Inc. Source: A guide to the roject management body of knowledge (PMBOK® Guide).