Prince2 Project Management Methodology: What You Need to Know

Prince2 is among the most widely practiced project management methodologies around the world. Initially, it was created for the United Kingdom government as a way to manage IT projects effectively. However, due to its success, Prince2 has quickly spread to the private sector. 

The acronym stands for “Projects in Controlled Environments". The name itself reveals the essence of this methodology — it is a process-oriented approach that provides a detailed framework and control over the project from start to finish. 

The 2 in the methodology’s name signifies that this is the fine-tuned version of the method. As it was originally developed for the government sector, Prince underwent a review from 150 private and public organizations to make it more applicable to a variety of different industries.

The Prince2 methodology emphasizes splitting the project into logical, individually managed and controlled stages. That is, the project plan details every aspect of each stage, from business goals and timelines to resources and execution.

Prince2 works based on its integral principles, themes, and processes being integrated within the same project environment. But, to better understand this methodology, we must take a closer look at each of these elements. 

Prince 2 Principles 

The methodology rests on seven principles, all of which must be applied simultaneously. They include:

1. Business Justification — Before any work can commence, the company must confirm that there is a justifiable reason for starting the project. That means that it’s crucial to identify the needs the project has to fulfill and perform detailed market research. Likewise, the project must provide benefits that surpass the costs of executing it.
   
2. Continuous Learning — The project team must learn continuously from experience. Throughout the stages, each team member should actively seek out lessons that can help optimize work in the future.
   
3. Clearly Defined Roles and Responsibilities — Prince2 dictates a clear organizational structure in which everyone knows their role and is aware of their responsibilities.
   
4. Projects are Divided and Managed in Stages — With Prince2, the project is divided into logical phases. What’s more, each phase is individually planned and carefully monitored and controlled.
   
5. Managing by “Exception” — The project board (senior executives) is in charge of defining the scope of the project, establishing the timeline, allocating resources, and assessing risks. However, managing daily activities regarding the project is in the hands of the project manager. The “exception” here is the fact that, should any major issues arise and threaten the project as a whole, the project board has the final say regarding how to move forward.
6. Focus on Product Quality — With Prince2 project management, the accent is on product definition and quality. That is, the deliverables are always audited to ensure they meet all the requirements.
   
7. Tailored Approach — The method can and should be adjusted according to the specific project’s scope, complexity, environment, capability, and risk.

The Prince2 Methodology Themes

The themes represent different aspects of project management, all of which the team must simultaneously and continuously address until the project is completed. To facilitate the implementation of each aspect, Prince2 defines the minimum requirements for each aspect and provides detailed guidelines. 

The Prince2 themes include:

1. Business Case — As mentioned, business justification is a key requirement for the project. Therefore, companies must document business justification by creating and maintaining a record of it.
2. Organization — This goes hand in hand with the third principle. Namely, Prince2 calls for a clearly defined organizational structure, where everyone involved knows what role they play in the project.
3. Quality — Everyone must be familiar with the quality requirements, means of measuring them, and the way in which the project needs to deliver them.
   
4. Planning — The team must thoroughly plan every aspect of the project, including which Prince2 techniques individual members will use.
   
5. Risk — Risk assessment is another vital theme of Prince2. That is, you must identify the possible risks, as well as introduce efficient means of managing it.
   
6. Change — Changes are almost inevitable when working on complex projects. Hence, the project manager needs to be able to assess them accurately and act accordingly without hesitation.
   
7. Progress — Prince2 encourages the ongoing improvement of plans and performance.

Seven Processes of Prince2 

The seven processes of Prince2 project management describe how a project should be managed and delivered. That is, each process comes with a detailed checklist of activities and details related to responsibilities. In addition, Prince2 provides guidelines on how to tailor each process to a specific project environment. 

Here is the Prince2 process framework:

Starting up the Project

Before any project receives the green light, a project board must assess its viability. When filing for a new project, the person recommending it must create a project mandate. That is a brief document that explains why the company should undertake the project and what it seeks to accomplish.

Once the project board gives the green light, the person who suggested the project creates a business case. That is a much more detailed document that includes how the project should be executed, the scope of work, resources, manpower required, etc.

Directing the Project

Here, the project board will carefully review all project briefs to assess their viability based on business justification. After the final approval, they deliberate how to organize and execute each project and decide how to delegate it to a project manager. 

Initiating the Project

The Prince2 methodology emphasizes thorough planning of business activities. So, before any work can commence, the project manager must create an initiation document. In it, they provide a comprehensive project plan, explaining exactly how they are going to execute it. The initiation document also provides baselines for six performance targets: scope, time, cost, quality, risks, and benefits.

Control Stages

This is where the project is divided into various logical phases. Namely, the project manager splits the overall project into “work packages” and distributes them to different teams. They also assign tasks and oversee the team’s progress during each phase. Furthermore, when necessary, the project manager also steps in to clear any hurdles or correct mistakes to ensure the project moves forward and remains viable. 

Managing Product Delivery

As we’ve mentioned, one of the core elements of Prince2 project management is quality. Therefore, before delivering the product to the end-users, the project manager compares the progress against the project brief, to ensure that all the deliverables meet Prince2 quality standards. 

Once again, the project board has the final vote. If they’re unsatisfied with the product quality, they can request changes or revisions. 

Managing Stage Boundaries

The project manager and the board perform detailed reviews of each stage. The project manager provides the board with a detailed performance overview and updates the project plan to prepare for the next stage. 

The board then reviews the current progress and decides to either proceed to the following stage or abandon the entire project. Should the next stage be approved, the project manager performs a stage evaluation with the team, and they discuss any lessons learned in the previous stage and how to apply that knowledge to improve performance in the next. 

Closing the Project

Here, the project manager makes sure the project has met its goals, evaluates the entire project, and recommends its closure. The project board then closes it officially . What’s more, this phase also involves wrapping up any loose threads, such as reporting, outcomes, and Prince2 documentation. 

The Prince2 Methodology Roles

We’ve already highlighted the importance of roles in Prince2. Apart from the key players — the project board, project manager, and project themes — other important roles help ensure the success of the project.

Customers — They are the ones financing the entire project. 

Users — The people who will use the product directly.

Suppliers — Suppliers in Prince2 aren’t suppliers in a traditional sense. That is, rather than providing goods or resources, they provide the necessary expertise and are invaluable when it comes to product design.

Project Managers — Professionals within the company’s infrastructure, who are responsible for organizing and planning the project and overseeing work progress. They also assign tasks and present the work results to the project board at the end of each stage.

Project Teams and Team Managers — Company employees assigned to work on the project. Team managers keep track of daily project activities and regularly report to the project manager. 

Administrators — They are in charge of maintaining and updating the documentation and setting up company meetings. With smaller projects, a project manager can take over these responsibilities. However, larger and more complex projects call for a support office that will handle administrative tasks.

The Project Board 

Lastly, we have the project board. This entity typically consists of people in several positions:

The first seat on the board is reserved for the customer. However, keep in mind that this isn’t necessarily a customer in the traditional sense. That is only the case if someone else employs your company’s services to work on their project. But, if the project originated from the company itself, the customer is one of the senior executives (since they’re the ones financing the project). 

Secondly, we have the users or their representatives. Their job on the board is to ensure that the project meets the end-users’ needs. 

The supplier typically occupies the final spot. This expert reviews the project, assesses its viability throughout the stages, and ensures it’s progressing towards a viable, practical solution.

Prince2 Documentation 

Prince2 is a rigid methodology, with a focus on detailed planning and extensive documentation. All the work on the project is meticulously recorded and maintained. Furthermore, the information helps evaluate the work and provides the material for the lessons which help improve the process down the road. Additionally, the records are essential when reporting to the project board and assessing the quality of deliverables. 

Here are the different types of documents Prince2 utilizes:

• Business Case — A document detailing the reasoning behind starting the project, the needs it’s supposed to meet, the impact on the end-users, and the benefits to the business.
  
• Risk Register — It contains all the information concerning potential risks and opportunities along with their probabilities and impact.
  
• Quality Register — This is a log of quality checks that helps ensure that deliverables continuously meet quality expectations.
• Issues Register — All the issues the team runs into while working on the project are also documented. The issues register also contains any hurdles team members may run into.
  
• Lesson Log — A log of all the lessons the team learned during each stage. The lessons help improve performance in the following stages and future projects.
  
• Daily Log — A log kept by the project manager containing reports on activity and work progress. 

What Are the Benefits of Prince2?

Now that we’ve combed through the technical side of the Prince2 methodology, it’s time to look at the reasons why you’d want to implement it. There is a reason Prince2 is one of the preeminent project management methodologies, after all. 

Its appeal comes from the fact that the framework it provides covers every aspect of project management. Apart from defining the roles and responsibilities and detailing every stage of the project, it also provides guidelines for all project activities.

The main benefits of Prince2 are:

• A clearly defined, consistent approach to project management,
• Projects are broken down into logical stages that are easier to manage and execute,
• A detailed plan of project activities,
• Stage reviews that ensure that the project maintains business justification,
• Management control that prevents deviations from the original plan,
• Good communication within the entire organization,
• Flexible decision points,
• Team logs of everything they learned which helps improve future performance,
• A higher quality of end-products.

With that in mind, Prince2 has one significant drawback that you must be aware of. Namely, since planning is done before any work can begin, this methodology isn’t suited for projects where the requirements are prone to change. Additionally, due to the extensive work necessary to create and maintain the logs, Prince2 isn’t the most efficient approach for smaller projects. 

Prince2 Agile Project Management

As you’ve probably guessed, Prince2 Agile represents a merger of two methodologies. That is, it seeks to apply the principles of Prince2 in an Agile environment. Namely, while Prince2 focuses on the strategic part of project management, Agile prompts a more flexible, delivery-oriented work. 

This type of merger offers a holistic approach and allows Agile companies to incorporate the comprehensive management approach of Prince2 while maintaining flexibility and responsiveness. 

Prince2 Agile introduces a new hexagon model, with six focal points. Furthermore, time and cost are still fixed and cannot be altered after the project starts. However, the benefits of the project and risks involved may be flexible and can be addressed at any stage. 

Finally, the Quality and Scope of the project are extremely flexible. However, that doesn’t mean that the company can sacrifice quality to meet the deadlines. On the contrary, it merely suggests that different variables constitute quality and that certain features of the product might not be necessary and are prone to change.

Becoming a Prince2 Practitioner

Prince2 is a rather complex methodology. Therefore, you’ll need to master all its processes to successfully implement it. Thankfully, Prince2 has a course of study available that enables you to get certified in this methodology. Several accredited organizations allow you to take the course and the exam to become a certified Prince2 practitioner. 

There are four levels of Prince2 certifications:

If your company requires a standardized approach to project management where all roles and responsibilities are clearly defined and that requires you to split massive projects into more manageable work packages, the Prince2 methodology might be the perfect fit.