Key Concept: Management Levels

Four levels of management are associated with a PRINCE2® project:

1.    Senior management who provide authority and budget and set project level constraints[1], provide resources and are a peer group for the (B.2) Executive. PRINCE2® calls these senior people “Corporate or Programme Management”.

2.    The (B.1) Project Board who set stage level tolerances upon the (B.5) Project Manager. The (B.1) Project Board is made-up of the (B.2) Executive, (B.3) Senior User and (B.4) Senior Supplier. These three roles[2] are the project’s key decision makers.

3.    The (B.5) Project Manager who is authorised to run the project’s day-to-day activities on the board’s behalf, who reports upwards to the board and manages downwards, perhaps via (B.6) Team Managers.

4.    (B.6) Team Managers (an optional role) useful when the team are geographically remote, work in a specialised discipline or number too many for the (B.5) Project Manager to manage them all personally.

Below the team manager are the team members. The specialists who create the project’s results, or impacts, or outcomes, or to use PRINCE2®’s own word the products.

The bottom three levels of the management hierarchy ((B.1) Project Board , (B.5) Project Manager and (B.6) Team Managers) plus (B.7) Project Assurance, (B.8) Project Support and (B.10) Configuration Librarian are the project management team.

Key Concept: Tolerance and Management By Exception

PRINCE2®’s central control philosophy is management by exception. Management by exception is based on the concept of tolerances.

Tolerance is the positive or negative variance in cost or schedule or scope or quality or project benefit terms that each level of management within the project management team may oversee before the situation (exception) must be brought to the attention of the next higher level of management.

An exception is any situation where the project management team members are or may soon be operating outside of their delegated tolerance limits. Note that an exception occurs as soon as the possibility for variation from plan beyond tolerance exists. IE an exception can exist even though tolerance is not yet exceeded.

PRINCE2® demands the involvement of senior and thus often busy people. Management by exception or reporting when tolerance is or may be exceeded is the means for senior people to limit the time they commit to when it is actually required and thus avoid routine involvement that does not add value.

Next concept: PRINCE2®'s elements