Project Definition and Characteristics
PRINCE2 defines a project as "a temporary organization that is created for the purpose of delivering one or more business products according to an agreed Business Case." This definition emphasizes several key characteristics that differentiate projects from business-as-usual operations. Projects are temporary endeavors with defined start and end dates, focused on creating unique deliverables or products. They involve cross-functional teams brought together specifically for the project duration and are subject to uncertainty and changing conditions. PRINCE2 projects are characterized by their unique, transient nature and are established to deliver specific business change. The methodology recognizes that projects exist within an organizational context and must be aligned with wider business objectives and strategies. A project must create products that enable benefits to be realized, and these benefits must outweigh the costs and risks of undertaking the project—this cost-benefit ratio is documented in the Business Case, which serves as the primary decision-making document throughout the project lifecycle. PRINCE2 emphasizes that proper project management is essential because projects introduce change, which inherently carries risk. Without proper management techniques, projects can exceed budgets, miss deadlines, deliver the wrong products, or fail to achieve expected benefits. The methodology offers a structured approach to managing these project-specific challenges while maintaining focus on business justification.
Project Definition and Characteristics: A Complete Guide for PRINCE2 Foundation
Introduction
Understanding project definition and characteristics is fundamental to PRINCE2 methodology. This knowledge forms the backbone of effective project management and is frequently tested in the PRINCE2 Foundation exam.
Why Project Definition and Characteristics are Important
Projects drive change in organizations. Recognizing what constitutes a project and its key characteristics enables managers to:
• Apply appropriate governance structures
• Select suitable management approaches
• Allocate resources effectively
• Establish clear expectations with stakeholders
• Distinguish projects from business-as-usual activities
What is a Project in PRINCE2?
PRINCE2 defines a project as: "A temporary organization that is created for the purpose of delivering one or more business products according to an agreed Business Case."
This definition emphasizes several key elements:
• Temporary nature: Projects have defined start and end points
• Organizational focus: Projects require specific governance and team structures
• Deliverable orientation: Projects create specific products or outcomes
• Business justification: Projects must deliver value through a Business Case
Key Characteristics of PRINCE2 Projects
PRINCE2 projects share six essential characteristics:
1. Change: Projects introduce change to an organization
2. Temporary: Projects have finite lifespans with defined start and end points
3. Cross-functional: Projects typically require skills from different disciplines
4. Unique: Projects address specific needs and situations
5. Uncertainty: Projects involve risks and unknowns
6. Business products: Projects deliver specified outputs, outcomes, and benefits
How PRINCE2 Projects Work
PRINCE2 projects operate through:
• Defined processes: Seven processes guide the project from start to finish
• Product-based planning: Focus on deliverables rather than activities
• Management by exception: Escalation based on tolerance breaches
• Clear roles and responsibilities: Through the project management team structure
• Business justification: Continuous validation via the Business Case
• Tailoring: Adapting the method to suit project context
Distinguishing Projects from Business-as-Usual
Projects differ from routine operations in several ways:
| Projects | Business-as-Usual |
|---|---|
| Temporary | Ongoing |
| Create change | Maintain status quo |
| Unique challenges | Repetitive activities |
| Variable resource needs | Stable resource requirements |
| Higher uncertainty | Lower uncertainty |
Exam Tips: Answering Questions on Project Definition and Characteristics
1. Know the precise definition: Memorize the PRINCE2 project definition verbatim
2. Identify all six characteristics: Be able to recognize each characteristic in scenario-based questions
3. Understand boundary examples: Practice distinguishing between projects and non-projects in borderline cases
4. Connect to other PRINCE2 elements: Link project characteristics to themes and processes
5. Watch for scenario questions: Apply your knowledge to determine if a described activity meets project criteria
6. Focus on terminology: Pay attention to specific PRINCE2 terms like "business products" and "temporary organization"
7. Revisit project definition: Return to this foundation topic regularly during your studies
Sample Exam Questions
1. Which of the following best defines a project according to PRINCE2?
2. Which characteristic of a project refers to its defined beginning and end?
3. In a scenario describing routine maintenance work, identify why this may NOT be considered a project.
4. Which project characteristic relates to the need for specialized skills from different departments?
Key Takeaways
• Projects are temporary organizations created to deliver business products
• Six characteristics distinguish projects from other work
• Understanding project definition helps apply PRINCE2 principles correctly
• Clear project definition guides proper governance and management approaches
• Recognizing project boundaries helps identify when PRINCE2 should be applied
Master these concepts thoroughly as they form the foundation upon which all other PRINCE2 knowledge is built.
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