The PRINCE2 Project Stages and Processes - PRINCE2 Project Management

PRINCE2 is an acronym for Projects in Controlled Environments. The original PRINCE methodology of project management was updated in 1996, hence the “2” in PRINCE2 methodology. It is a process-driven project management methodology. This methodology divides the entire project into processes. Each of these processes is managed independently. Each process is defined by its inputs and outputs, precise goals, and activities to be completed.

The PRINCE2 methodology of Project Management focuses on managing resources and risks by dividing projects into smaller stages and controlling the project life cycle with seven PRINCE2 processes. The PRINCE2 framework necessitates that projects have well-organised and contained beginnings, middles, and endings. In this blog, we will go into the details of the PRINCE2 project stages and the seven PRINCE2 processes of Project Management.

Table of Contents

1) Let's dive into the PRINCE2 Project Stages

2) What are the Management Stages in PRINCE2?

  a) Management Stage 1 - Initiation Stage

  b) Management Stage 2 – Planning of the Next Stage

3) PRINCE2 Methodology - Advantages of Working in Stages

4) Understanding Decision Gate in the PRINCE2 Methodology

5) What are the Seven PRINCE2 Processes?

  a) Starting up a Project

  b) Initiating a Project

  c) Directing a Project

  d) Controlling a Stage

  e) Managing Stage Boundaries

  f) Managing Product Delivery

  g) Closing a Project

6) Conclusion

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Let's Dive into the PRINCE2 Project Stages

The secret behind successful Project Managers handling large-scale work or projects lies in their ability to break the workload into smaller, manageable parts. In PRINCE2 methodology, these manageable parts are known as PRINCE2 Project Stages. PRINCE2 projects are planned, monitored, and managed Stage by Stage, ensuring consistent progress and control. A key element contributing to this structured approach is the Quality Theme in PRINCE2, which ensures deliverables meet defined standards throughout each stage. The Project Board further divides these Management Stages into Decision Points, also referred to as "Control Points".

At the end of each stage, the Board evaluates the previous stage's progress, the Business Case, and the upcoming stage's plan to determine whether to advance to the next step. When a project has more stages, the Project Board gains greater influence but also takes on more responsibility. Conversely, fewer stages mean Senior Management has less control, while the Project Board handles more periodic tasks. Understanding these dynamics is crucial for project governance, making it a key topic in PRINCE2 Interview Questions.

What are the Management Stages in PRINCE2?

The PRINCE2 Qualification framework defines the PRINCE2 project stage as the management stage. According to the PRINCE2 methodology, every project must have at least two management stages: the initiation stage and the planning of the next stage. The Closing a Project process in PRINCE2 serves as the final phase of a two-stage project.

Management Stage 1 - Initiation Stage

As the name implies, the Initiation stage occurs at the start of the project. During this Stage, a Project Manager is required to prepare a document named Project Initiation Document (PID). In the PID, the Project Manager has to document the project plan and detailed business case justifying the investment in the project. The PID also contains the strategies for quality management, risk management, changes, communication plan and other benefits of taking up a project.

Management Stage 2 – Planning of the Next Stage

The Project Manager is responsible for creating a detailed plan for the upcoming management stage as part of the PRINCE2 methodology. This plan should outline the tasks necessary for the next stage, the required resources, the schedule and costs, and the expected outputs. A key aspect of this process involves defining the PRINCE2 Project Scope, ensuring all elements are aligned before proceeding. This procedure is referred to as planning for the next Stage.

The organisation's decision-makers or the project board further use the PID and this next stage plan to evaluate costs, resources, timescales, and risks and decide whether to move to the next management plan. This entire process occurs at the end of every subsequent management stage, excluding the final Stage, as the project is closed here.

If the project board decides not to move to the next Stage, the project will be closed depending on the evaluation. There will be no more work done except to complete the project and recover anything of value from the previous stages.

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PRINCE2 Methodology - Advantages of Working in Stages

Executing your project in stages will provide you with a structured approach to project planning. This will make project teams work more efficiently as they will clearly know the work required. Understanding PRINCE2 Methodology Advantages and Disadvantages can help project managers determine whether this structured framework aligns with their project's needs.

Project managers get various benefits from dividing their projects into stages. They are:

1) They can divide the entire project into smaller manageable chunks, thereby reducing the clutter

2) Executing projects in stages will ensure that future stage plans may learn from earlier stage’s misdoings

3) Project Managers will be assisted by creating a high-level Project Plan for the entire project as well as a comprehensive Stage Plan for each stage

4) Project Managers can plan, monitor and control the projects on a stage-by-stage basis

Understanding Decision Gate in the PRINCE2 Methodology

The end of any PRINCE2 Project Stage serves as a decision gate. At this stage, the project board either approves moving to the next stage or decides to close the project. Thus, the PRINCE2 project stages help evaluate the time, money, and resources required for each project stage, ultimately saving the organization a lot. As explained in the Prince 2 Study Guide, at the end of each PRINCE2 stage, the project board must make a crucial decision: "to move ahead or not."

What are the Seven PRINCE2 Processes?

The PRINCE2 Project Management methodology uses seven project management processes suitable to any project irrespective of its scale and scope. As PRINCE2 is a controlled environment method, these PRINCE2 processes clearly define the roles and responsibilities of project managers, project board and stakeholders. This way, everyone can be on the same page, and there will be no room for misunderstandings. We have understood what the PRINCE2 project stages are. Now let's move ahead to understanding the seven processes of the PRINCE2 methodology.

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Starting up a Project

This is the first PRINCE2 process. In this pre-project process, it is assessed whether the project should be taken up or not. To do this, in this stage, a project brief, business case, and detailed stage plan that will provide the project mandate are developed by the project manager.

In this PRINCE2 process, project managers, the project team and the project board are appointed. The role of the Project manager and Project board is to ensure that investment of time and resources is made, taking into account the risks to the project.

The starting up of a project PRINCE2 process is done once in each project to gain the authorisation necessary for the following process - initiating a project.

Initiating a Project

This process involves planning in detail, i.e., planning timescale, budget, quality, scope, risk, benefits and communication management strategies. This output document containing these details is prepared by the Project Manager and is called Project Initiation Document (PID).

The Project Manager has to set up project controls and project files and assemble a Project Initiation Document (PID) in this second PRINCE2 process.

Directing a Project

Directing a project PRINCE2 process spans from the project's starting stage to the project's closing. This process has mainly to do with the responsibilities of the Project Board. Under this PRINCE2 process, the project board assigns the project manager day-to-day responsibilities. The Project Board still makes critical decisions and ultimately controls the project. Through this process, the Project Board is kept accountable for its decisions.

The Project Board, within the framework of PRINCE2 Programme Management, has the authority to initiate the project, deliver the product, and close the project. They also provide direction to the project and determine, after each stage, whether to proceed or conclude the project. If the Project Board approves and decides to move forward to the next stage, they identify all necessary resources and delegate them to the Project Manager.

Project Board also collaborates with business entities to assess post-project benefits. Authorising the beginning, the project itself, and the project stages are all activities associated with directing a project PRINCE2 process.

Controlling a Stage

This PRINCE2 project process defines the Project Manager's monitoring progress and controlling tasks. This is where the project manager assigns tasks to the project team, oversees the work, deals with any difficulties that emerge, and reports to the project board on the progress of the project activities.

The controlling a stage process describes the project manager's activities within each project's management stage, including project authorisation, assessing project progress, reviewing stage progress, reporting highlights, escalating project issues and taking mitigating actions, and submitting the appropriate reports to the Project Board.

Managing Stage Boundaries

This PRINCE2 process offers the Project Board critical decision points for whether or not to proceed with the project. In this process, the project manager evaluates performance to the project board, updates the project plan and business case, and develops a strategy for the next stage. All this information by the Project Manager assists the Project Board in reviewing the current stage, approving the next stage, and reviewing the revised plan. The Project Board assess the project at every stage for quality and adherence to the plan.

The key activities in this process include:

1) Preparing for the next stage and reporting on the stage's completion

2) Updating the project plan

3) Risk register

4) Business case

Managing Product Delivery

This project process governs the link between the Project Manager and the team managers. This process is based on the customer or supplier environment. The process of managing product delivery explains the team manager's responsibilities as a provider, that is, in achieving the goals of a work package.

The key activities associated with this process include:

1) Accepting the work package

2) Executing the work package

3) Reviewing the completed project tasks

4) Comparing the progress with the original project brief

5) Delivering the work package

Afterwards, the project manager has to obtain approval for the completed work package from the Project Board.

Closing a Project

In this PRINCE2 project process, the Project Manager has to ensure that the goals and objectives of the project are achieved per the PID by the deadline. Project Managers are responsible for ensuring that the project products are delivered, evaluating the project, submitting the project and recommending the project closure to the Project Board.

The project manager must complete any remaining documentation and reporting and update the issue register during this process. Also, sometimes the Project managers may prepare both the scheduled and unplanned project closures, although this is not essential. The Project Manager has to get approval from the Project Board at the end of the project, and the board will give final approval after assessing the project deliverables.

Explore our blog on PRINCE2 Agile in Large Projects to see how organisations use its structured yet adaptable approach for successful project delivery!

Conclusion

A Project Manager must conduct regular process reviews throughout the project lifecycle. As a Project Manager, you have the flexibility to choose PRINCE2, PRINCE2 vs PRINCE2 Agile, or any other project management methodology that best suits your project needs. We hope this guide has provided you with the necessary insights into PRINCE2 stages and processes to help you make an informed decision when selecting a project methodology. If you have any doubts or questions, feel free to share them in the comments below.

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