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Exam Code: GR7
Exam Name: International Remuneration - An Overview of Global Rewards
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NEW QUESTION: 1
Management reserve is needed on projects. According to the PMBOK Guide, which of the following is true about management reserve?
A. It may involve cost but not schedule
B. It allows for handling future situations that are impossible to predict
C. It is sometimes called "unknown knowns"
D. Its use does not require a change in the project's baseline
[#1] Mine was C, Reference is PMBOK 143-144 Source: IIL PMIQ (based on Kerzner). D & B can pretty much be eliminated. So let's look at the reference to choose between A & C. A visual scan of pages 143-144 and an electronic search for the term "management reserves" in PMBOK returns no results. However, there is a definition of known vs unknown risks with regard to contingencies on p.129 that says "Known risks are those that have been identified and analyzed, and it may be possible to plan for them. Unknown risks cannot be managed, although the project managers may address them by applying a general contingency based upon past experience with similar projects."PMBOK does not suggest that general (ie management) contingencies are for risks that are IMPOSSIBLE to predict. In fact, it suggests the opposite by saying that past experience would be the basis for determining the general contingency amounts!Kerzner's own definition (p. 833) also contradicts the question, leading me to believe it is an error on the CD: "Management reserves are the contingency funds established by the program manager to counteract unavoidable delays that can affect the project's critical path. Management reserves cover unforeseen events within a defined project scope that experience has shown are likely to occur. Management reserves are not used for unlikely major force events or changes in scope."OK, so does everyone agree this test question is flawed?[#2] I disagree with you. I would have picked A as the answer.Management reserves are held by the sponsor, for his/her own needs, to ensure the project can be completed. The project manager should have defined his/her own contingency allowance based on risk, presumably to cover off the "unknown-knowns". Keep in mind that contingency allowance is distinct from management reserve.[#3] This is correct. To reinforce the point, Management Reserves belong to management, not to the Project Manager, and they are not part of the project plan. Management reserves are for the protection of management, not the project or the PM. The PM can include contingency in the project plan, based on risk analysis, but this is not management reserve. In the event of an unplanned-for risk event (an unknown-unknown), management reserves might be used to reduce the impact that the troubled project has on any other plans management might have. Management reserve can take any number of forms, e.g. budget reserve (have extra cash budgeted to apply to troubled projects), or schedule reserve (telling you they need it by January and not planning for it to be available until May). Management reserves do protect the project, in the sense that, if the project is in trouble, they help prevent losing the business need for the project and thus prevent it from being cancelled.
NEW QUESTION: 2
Which of the following statements highlights key performance indicators to be documented in the project scope?
A. There will be a reduction in technology costs of one million dollars a year
B. The solution will not include integration with the finance system
C. Efficiency gains will enable five fewer days to provide staff access
D. IT staff will be able to maintain the project after completion
NEW QUESTION: 3
Optical fiber all-dielectric cables have an additional advantage over ones containing a steel strength member. That advantage is:
A. More resistant to rodent damage
B. More resistant to lightning and electrical conduction
C. More difficult to damage
D. Cables are made of a tougher outer PVC jacket
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