PRINCE2 is a structured project management method that revolves around seven fundamental principles. These principles are: continuous business justification, learning from experience, defined roles and responsibilities, management by exception, product focus, tailoring to the project environment, and phasing. Together, they form a powerful framework that helps you to successfully lead projects, manage risk and deliver value. By understanding and applying these principles, you will have a solid foundation for effective project management.
What are the 7 principles of PRINCE2?
The 7 principles of PRINCE2 form the core of this project management method. They guide the way in which you set up, execute and close projects. Below you will find an overview of these principles:
- Continuous business justification – Every project must have a clear business justification that remains valid throughout the project.
- Learning from experiences – Project teams should leverage lessons learned from previous projects and document new experiences.
- Defined roles and responsibilities – Everyone involved in the project must know exactly what his or her tasks and responsibilities are.
- Management by exception – Higher management levels only intervene when certain tolerance limits are exceeded.
- Product-oriented approach – A project focuses on delivering products that meet the agreed quality requirements.
- To customize – PRINCE2 must be adapted to the size, complexity and risks of the specific project.
- Phasing – Projects are divided into manageable phases for better control and guidance.
These principles do not work separately but together form a coherent whole. You apply them in combination with the PRINCE2 processes, themes and roles to make your project successful.
How do you apply continuous business justification in projects?
Continuous business justification means that your project should always have a valid reason to exist. This principle revolves entirely around the Business Case, the document that contains the business justification of your project.
You start by drawing up a Business Case in which you make clear what benefits the project will deliver and what costs, time investment and risks are associated with it. But you are not there yet. At each phase transition you reassess whether the Business Case is still valid.
These are the most important aspects to take into account:
- Check regularly whether the expected benefits are still realistic
- Determine whether the costs and schedule are still within acceptable limits
- Evaluate whether changed circumstances affect the justification
- Dare to stop a project if the Business Case is no longer valid
What is special about PRINCE2 is that it explicitly states that a project must be stopped when the business justification ceases. This prevents wasting time and money on projects that no longer add value.
Why is learning from experience so important within PRINCE2?
Learning from experience ensures that you do not make the same mistakes over and over again. This principle recognizes that every project provides valuable insights that can improve future projects.
At the start of a project, you actively seek lessons from similar previous projects. These can be both successes and failures. During the project, you record new experiences in a logbook or register. At the end, you ensure that these lessons are available for future projects.
The cycle of learning works as follows:
- Look for existing experiences at the start of the project
- Apply these lessons in your project approach
- Document new experiences during the project
- Share this knowledge at the end of the project
By consistently applying this principle, you build a valuable knowledge base that contributes to the success of future projects. It also encourages a culture of openness in which both successes and mistakes are recognized as learning opportunities.
What does the principle of 'management by exception' entail?
Management by exception means that you only involve higher management levels when it is really necessary. This principle enables efficient use of managers' time and gives project teams sufficient freedom to do their work.
The core of this principle is working with tolerance limits. For each project objective (time, cost, quality, scope, risk and benefits) you set limits within which the project team may operate independently. Only when the project threatens to go beyond these limits, you escalate to a higher level.
These are the key elements of management by exception:
- Establishing clear tolerance limits for each project objective
- Regular progress reports to see if you are staying within limits
- A clear escalation process when tolerances are in danger of being exceeded
- Decision-making at the right management level
This principle provides a good balance between control and flexibility. Managers do not have to be involved in day-to-day decisions, but are warned in time when problems are looming. This allows them to spend their time on strategic issues instead of micromanagement.
How can you tailor PRINCE2 to your organization?
PRINCE2 is not a rigid, one-size-fits-all method. The principle of 'tailoring' emphasises that you should adapt the method to the specific context of your project and organisation. This prevents PRINCE2 from being perceived as bureaucratic or cumbersome.
When sizing, consider the scale, complexity and risks of your project. A small, low-risk project will require fewer controls and documentation than a large, complex, high-risk project.
Some practical tips for customization:
- Adapt the terminology to match the language of your organization
- Combine or simplify roles if the project is small
- Determine which products (documents) are really needed and which you can merge
- Integrate PRINCE2 with existing methods in your organization, such as PRINCE2 and agile working methods
- Always keep the 7 principles as a basis – these are non-negotiable
Customization is a balancing act: you want to make the method light enough to be workable, but robust enough to retain the benefits of PRINCE2. By making conscious choices, you get an approach that fits your organization and project.
What are the benefits of PRINCE2 for your projects?
The 7 principles of PRINCE2 together provide a powerful framework that will take your projects to the next level. The key benefits you can expect are:
- Better decision making through continuous focus on business justification
- Fewer repeated errors thanks to learning from experience
- Clearer responsibilities through defined roles
- More efficient use of management time through management by exception
- Higher quality through the product-oriented approach
- Flexibility by tailoring to your project environment
- Better control through project phasing
PRINCE2 is recognized worldwide as a reliable method for project management. The principles are based on decades of practical experience and form a solid foundation for success. In our daily practice we see that organizations that apply PRINCE2 well consistently achieve better project results.
Want to learn more about how to effectively implement PRINCE2 in your organization? Or do you need help tailoring this method to your specific projects? Then contact us contact with us. We are happy to help you make your projects a success with the power of PRINCE2.
