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                  Project management header
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                  Assumptions



                  All projects are based upon key assumptions

                  Every project will be based on many assumptions.
                  These will apply to all departments and at all stages of the project.
                  For example, if you plan to purchase equipment in 6 months time for a large sum it may be based upon a particular exchange rate.

                  If this moves unfavourably it could be costly.
                  There will be many more.

                  Record the major ones

                  What ever assumptions are made they must be recorded.
                  Simple assumptions might be:

                  • No more than 1 month lost to bad weather
                  • The exchange rate remains below $1.8 to the £
                  • Raw material prices are stable over the next 12 months

                  The noted assumptions can be treated as risks

                  Assumptions vs constraints

                  There is often confusion between assumptions and constraints.

                  • Assumptions

                  These are what the Project Manager expects to have or are easily accessible for the project.
                  If they are not, then key project milestones may be missed, for example, late completion date etc.

                  • Constraints

                  These could have a negative effect on the project.
                  They are often not under the control of the Project Manager and tend to be imposed.
                  For example, the personnel department may have an embargo on recruitment.
                  Whilst the project plan will have been prepared with these in mind, these constraints may still prove to be the undoing of the project. Budget limits are another.

                  Assumption / implication / action

                  One needs to avoid the ‘I told you so’ syndrome when dealing with assumptions.
                  They are not there to fall back on when the project runs aground.
                  If one notes assumptions then any implications must be noted if they are not met, together with any resulting actions.
                  It should be made clear what the Project Manager intends to do about it.

                  For example:

                  Assumption:

                  2 personnel will be required from marketing.

                  Implication:

                  If unavailable production start will be delayed.

                  Action:

                  External consultants will be contracted at £500 per day.

                  In other words, there is no point making an assumption if you have not considered the likelihood of it going awry.
                  As with other risk areas you will need to consider the likelihood of its occurrence and the possible impact.
                  If the impact is very low there will be little incentive to draw up contingency plans.
                  Conversely, a wrong assumption may have a massive impact but be extremely unlikely.
                  An extreme case would be assuming the sun will rise the next day.

                  These aspects of risk and others are discussed in much greater detail as part of 'The Complete Risk Management package'.
                  This information can be recorded in the Project Notebook.

                  This is referred to within PRINCE2® [see ‘The Complete Project Management plus PRINCE2’] under the process 'Directing a Project (DP)' and the sub-process 'Authorising a Project (DP2)'.

                  PRINCE2? is a Registered Trade Mark of the Office of Government Commerce in the United Kingdom and other countries.

                  Non - PRINCE2 information

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