ACCA Strategic Professional · Strategic Business Leader

Leading and managing projects: formula sheet

Full chapter guide

Key formulas

Features of a project: Temporary + Unique + Defined objective + Constrained resources (time, cost, quality) + Creates change; Use these as a checklist to decide whether an activity is a project or operations.
Project constraints: Scope, Time, Cost, Quality (the project 'triangle'); A change in one usually affects the others. Use this to explain trade-offs in a scenario.
Project vs operations: Project: temporary, unique, change-focused. Operations: ongoing, repetitive, stability-focused.; Always contrast on at least three points: duration, repetition and purpose.
Role split: Sponsor = why and funding (business case). Project manager = how and when (delivery). Stakeholders = affected parties or influencers.; Not a formula, but a rule to keep roles distinct in your answer.
Project life cycle stages: Initiation → Planning → Execution (monitor and control) → Closure; State the model you use. Other texts add a separate 'monitoring and control' or 'post-completion review' stage.
Business case content: Need + Options + Costs + Benefits + Risks + Recommendation; Link benefits to strategy. Include both financial and non-financial factors.
Net present value decision rule: Accept if NPV > 0 (when evaluating independent projects, not under capital rationing); Use when the business case includes cash flows. NPV = Σ cash flow ÷ (1 + r)^t, with the initial outlay at t = 0.
PID core contents: Objectives, scope, deliverables, budget, timescale, governance, roles, risks, assumptions; The PID is the baseline against which progress and change requests are judged.
Project constraints: Scope, time, cost, quality (and risk); A change in one usually affects the others.
Earliest start and finish: Earliest finish (EF) = Earliest start (ES) + Duration; Work forwards through the network. Where several activities lead into one, the ES is the largest EF of the preceding activities.
Latest finish and start: Latest start (LS) = Latest finish (LF) − Duration; Work backwards from the project end. Where an activity leads into several, its LF is the smallest LS of the following activities.
Float (slack): Total float = LF − EF = LS − ES; Time an activity can be delayed without delaying the project end date.
Critical path: Critical activities have total float = 0; The critical path is the longest path through the network. It gives the minimum project duration. A network can have more than one critical path.
Triple constraint: Scope is delivered within time, cost and quality limits; Changing one constraint normally affects at least one other.
Risk exposure: Risk exposure = likelihood of the risk × impact if it occurs; Used to rank risks. Likelihood can be a probability or a high/medium/low score. Impact can be in money or a score.
Risk responses (TARA): Transfer | Avoid | Reduce | Accept; Choose one for each threat. Transfer through insurance or contracts, avoid by not doing the activity, reduce through controls, accept and monitor if the exposure is within appetite.
Cost variance: Cost variance = budgeted cost of work done − actual cost of work done; A negative figure means overspend. Use only if the question gives earned value data.
Schedule variance: Schedule variance = budgeted cost of work done − budgeted cost of work planned; A negative figure means behind schedule.
Control loop: Plan → Measure actual → Compare to baseline → Investigate variance → Correct and re-plan; The structure for any project control answer.
Iron triangle of project success: Success = delivered on time + within budget + to the required quality and scope; Necessary but not enough. Add benefits realised and stakeholder satisfaction for a full view.
Cost variance: Cost variance = budgeted cost − actual cost; A negative figure means an overspend. Use it in a review to quantify the gap against plan.
Schedule variance: Schedule variance (time) = planned duration − actual duration; A negative figure means a delay.
Benefits check: Benefits realised = actual benefits achieved vs benefits in the business case; Judged after completion, often months later. This separates project success from project management success.
Tuckman's team development stages: Forming → Storming → Norming → Performing → Adjourning; Use to explain how a team matures and how leadership should shift, from directing early on to delegating when performing.
Mendelow's matrix responses: High power + high interest = manage closely; high power + low interest = keep satisfied; low power + high interest = keep informed; low power + low interest = monitor; Classify each stakeholder from the case before recommending an engagement approach.
Project constraints: Scope, time, cost and quality (with risk) are interdependent; A change to one usually affects the others. Use this when assessing change requests.
Governance roles: Sponsor (business case) + Steering committee (oversight, stage gates) + Project manager (delivery); Use to identify gaps in accountability in a case scenario.

Quick revision

A project is temporary, unique and has defined objectives, a budget and a deadline.
The project manager is accountable for delivery; the sponsor owns the business case and funding.
Know the life cycle stages and what each produces, from initiation to closure.
Initiation needs a business case: benefits, costs, risks and fit with strategy.
Scope, time and cost are linked; quality is affected when you squeeze any of them.
Scope creep is uncontrolled growth in scope; manage it through formal change control.
Risk management: identify, assess likelihood and impact, respond, monitor and review.
Common responses to risk are avoid, reduce, transfer and accept.
Success has two sides: delivering the project on time, cost and quality, and achieving the intended benefits.
A post-completion review checks results against the plan and records lessons for future projects.
Map stakeholders by power and interest and plan how to engage each group.
Always link project advice to the case facts and to the organisation's strategy.

Common mistakes

Writing a textbook definition and stopping there. Fix: Spend one line on the definition, then spend the rest applying it to the facts in the scenario.
Treating any large or important activity as a project. Fix: Test for temporary, unique and change-focused. A big, ongoing, repeated activity is still operations.
Listing life cycle stages with no link to the scenario. Fix: Tie every stage to a fact from the case. Say what is happening, what is missing and what should happen next.
Treating the business case as a financial calculation only. Fix: Cover strategic fit, options, non-financial benefits, risks and stakeholders alongside the numbers.
Treating the question as a definitions exercise and listing project tools without applying them. Fix: Link every tool to a scenario fact. Say what the WBS or Gantt chart would reveal for this project.
Saying time, cost and quality are equally important. Fix: Pick the priority constraint and justify it from the scenario, then explain what you would trade off.
Listing generic risks that could apply to any project. Fix: Quote or paraphrase a fact from the scenario for each risk, then explain the effect on the project.
Confusing project risk with business risk. Fix: State the difference briefly: project risk affects delivery of the project, business risk affects the organisation's strategy. Then show how one feeds the other.
Defining success only as on time and on budget. Fix: Add benefits realised and stakeholder satisfaction, and say a project can meet the triangle yet still fail.
Listing generic causes of failure with no link to the case. Fix: Quote the scenario fact behind every cause, then explain its effect.

Exam tips

Do not write a definition essay. One or two lines of theory, then apply it to the case facts.
When a case describes a troubled project, look for role problems first: absent sponsor, unclear project manager authority or ignored stakeholders.
Always link the project to strategy. Examiners reward answers that ask whether the project should be done at all.
Use the format the requirement asks for, such as a briefing note or email, and finish with a clear recommendation to earn professional skills marks.
Pair this topic with stakeholder analysis. Power-interest reasoning is often needed to score well on stakeholder management points.
Always name the stage the project is at before you advise. Examiners reward answers that fit the scenario.
Treat the business case as the key test of initiation. Cover options, benefits, costs, risks and strategic fit, not only a calculation.
Challenge optimistic figures and weak sponsorship. This earns professional skills marks for scepticism and analysis.