In the context of PRINCE2 7, the distinction between leadership and management is central to the integrated 'People' element, acknowledging that while processes provide the framework, people deliver the project.

Management is defined as the discipline of organizing and controlling resources to achieve specific objectives. It focuses on complexity, order, and consistency. In a PRINCE2 environment, management is the mechanics of the methodology: creating the Project Initiation Documentation (PID), monitoring the stage plans, tracking risks in registers, and ensuring work packages are completed within tolerance. It is fundamentally about 'doing things right'—ensuring efficiency and adherence to the agreed processes and constraints.

Leadership, by contrast, is concerned with setting direction, aligning people, and providing motivation. It focuses on change, vision, and movement. In PRINCE2 7, leadership involves influencing stakeholders, fostering a collaborative team culture, and resolving conflicts through soft skills rather than just authority. It is about 'doing the right things'—ensuring effectiveness and ensuring that the project team is inspired to deliver the outcomes and realize the benefits.

PRINCE2 7 emphasizes that a competent Project Manager must function as both a manager and a leader. Over-reliance on management creates a bureaucratic, compliance-heavy environment that stifles innovation and morale. Over-reliance on leadership without management structure leads to chaotic execution and scope creep. Effective People Management requires the Project Manager to toggle between these modes: managing the artifacts and the plan, but leading the humans. They must manage the constraints of time, cost, and quality, while leading the communication necessary to maintain trust and psychological safety among the project board, the team, and external stakeholders.

In the context of PRINCE2 7, effective team management is elevated through the specific 'People' element, recognizing that projects are fundamentally human endeavors. Unlike previous editions that focused heavily on process, PRINCE2 7 explicitly integrates people management into the methodology, emphasizing that the interaction between the project management team and stakeholders is critical for success.

Effective team management begins with establishing a culture of collaboration and co-creation. This means involving the team in planning and decision-making to build ownership, rather than simply assigning tasks. The Project Manager must adopt a situational leadership approach, adapting their style—whether directive, coaching, supporting, or delegating—to fit the capability and maturity of the team members and the specific context of the project.

Crucially, PRINCE2 7 highlights the importance of psychological safety. Managers must create an environment where team members feel safe to report issues, suggest improvements, or admit errors without fear of blame. This directly supports the principle of 'Learn from Experience.' Furthermore, effective management involves navigating the diverse relationships defined in the project management team structure, ensuring clear communication channels between the business, user, and supplier interests.

Finally, managing the team requires a focus on well-being and motivation. By understanding individual drivers and managing change effectively, the Project Manager ensures the team remains resilient. Ultimately, effective team management in PRINCE2 7 is about aligning human effort with the business justification, ensuring that the team is not just delivering products, but is actively engaged in realizing value for the organization.

In the context of PRINCE2 7, Stakeholder Engagement is a pivotal aspect of the integrated 'People' element, reflecting the methodology's evolution to recognize that projects are socio-technical systems driven by human interaction. It goes beyond simple communication, focusing on building relationships, trust, and influence to ensure project success.

From a Practitioner's perspective, engagement follows a structured yet flexible cycle: identification, analysis, planning, implementation, and review. Stakeholders—defined as anyone with an interest or influence in the project—must be mapped based on their power, interest, and perspective. This analysis informs the **Communication Management Approach**, a key product that defines the means and frequency of engagement.

People Management within this framework requires specific soft skills. The Project Manager must utilize leadership, negotiation, and conflict resolution to align stakeholder expectations with project constraints. This involves managing resistance to change, ensuring that the 'voice of the user' is heard, and maintaining buy-in from the business layer. PRINCE2 7 emphasizes that engagement is not solely the Project Manager's duty; the Project Board plays a crucial role in managing high-level stakeholders and shielding the project from external political noise.

Ultimately, effective Stakeholder Engagement in PRINCE2 7 mitigates risk by ensuring that the project's outputs are accepted and utilized. It transforms passive observers into active participants, ensuring that the project delivers realized benefits rather than just technical outputs.

In the context of PRINCE2 7, the Change Management Approach is a critical management product that defines the procedures and techniques used to manage two distinct types of change: changes to the project baselines (issues and request for changes) and the organizational change required to embed the project's outputs into the business environment.

From a technical perspective, this document establishes the Change Control Procedure (Capture, Assess, Propose, Decide, Implement). It identifies the Change Authority—the person or group with the delegated authority from the Project Board to approve changes within a specific budget—and defines the usage of a Change Budget. This ensures that the project remains aligned with business justification even as requirements evolve.

However, regarding People Management, PRINCE2 7 places significant emphasis on the 'change' aspect of transition. The Change Management Approach must detail how the project will address the human side of the implementation. Projects deliver capabilities, but benefits are only realized when people change how they work. Therefore, this approach outlines how the project will prepare the organization for the new ways of working. This includes identifying resistance strategies, planning for training and upskilling, and defining communication methods to ensure stakeholders are ready, willing, and able to adopt the project's outputs.

By integrating technical change control with organizational change management, the approach ensures that while the project's products are protected from uncontrolled scope creep, the people who will use those products are supported through the transition, thereby maximizing the likelihood of benefit realization and minimizing the 'adoption gap' often seen in purely technical deliveries.

In PRINCE2 7, the Communication Management Approach is a vital management product established during the 'Initiating a Project' process. It serves as the definitive guide for how information flows between the project management team, the Project Board, and wider stakeholders. Within the specific context of the PRINCE2 7 'People' element, this document is essential for fostering a collaborative culture, managing expectations, and ensuring appropriate engagement.

The approach details the means, frequency, and format of communication. It is based on a thorough stakeholder analysis, which identifies interested parties, their influence, and their specific information requirements. Instead of a 'one-size-fits-all' strategy, the Communication Management Approach ensures that the Project Board receives high-level data for decision-making, while suppliers or technical teams receive the granular detail necessary for delivery.

Crucially, it assigns specific responsibilities for communication activities, ensuring accountability. It also defines the methods of communication—ranging from formal highlight reports and end-stage reports to informal emails, workshops, or dashboard access. By setting these ground rules, the Project Manager minimizes the risk of misunderstandings and conflict, which are common sources of project failure.

Furthermore, PRINCE2 7 emphasizes that this approach is dynamic. It includes feedback mechanisms to verify that messages are understood and allows the strategy to evolve at management stage boundaries as stakeholder interests change. Ultimately, the Communication Management Approach ensures the right information reaches the right people at the right time, acting as the nervous system of the project structure.

In the context of PRINCE2 7 and People Management, the Organizational and Project Ecosystem describes the interconnected environment in which a project operates. A project is a temporary organization created for a specific business purpose, but it does not exist in a vacuum; it functions within the boundaries of a permanent commissioning organization and a broader external environment. Recognizing and navigating this ecosystem is essential for the Project Manager to ensure that the project’s outputs are successfully adopted and realize their intended benefits.

The ecosystem is composed of interacting layers. At the center is the Project Team, focused on delivery. Surrounding this is the Permanent Organization (the business), which provides the mandate, governance, resources, and strategic alignment. Beyond the organization lies the External Environment, characterized by factors often analyzed using PESTLE (Political, Economic, Sociological, Technological, Legal, and Environmental). These external factors introduce risks and constraints that the project must accommodate.

A vital element of this ecosystem is Culture. PRINCE2 7 highlights that the project team often develops its own sub-culture, which may differ from the permanent organization's culture. The Project Manager must act as a bridge, ensuring that the project's pace and methods respect the organization's norms while driving change. If the project ignores the ecosystem—specifically the cultural and political dynamics of the permanent organization—it risks 'organ rejection,' where the business ultimately rejects the deliverables. Therefore, effective people management involves mapping this ecosystem to identify key influencers, aligning project values with organizational strategy, and managing the interfaces between the temporary project and the permanent business operations.

In the context of PRINCE2 7 and People Management, Project Culture refers to the shared values, beliefs, attitudes, and behaviors that characterize the temporary project organization. It is a critical component of the 'People' element, acknowledging that a method alone cannot ensure success without the right human dynamics. Essentially, it defines 'how we do things' within the specific boundaries of the project, often serving as a micro-culture that may differ slightly from the wider corporate culture.

Establishing a supportive culture is vital because projects bring together diverse individuals from different functions or organizations. Without a cohesive culture, friction arises, impeding communication and decision-making. PRINCE2 7 emphasizes that culture is not static; it must be actively managed and modeled by leadership, particularly the Project Board and Project Manager. They are responsible for fostering an environment of trust, transparency, and collaboration.

A key aspect of a healthy PRINCE2 project culture is psychological safety. This directly supports the principle of 'Learn from Experience.' If the culture is punitive or blame-oriented, team members will conceal risks and mistakes, undermining the ability to 'Manage by Exception.' Conversely, a positive culture encourages open dialogue about failures as learning opportunities, ensuring realistic reporting and effective risk management. Furthermore, the project culture determines how effectively the method is tailored. A rigid culture may resist the necessary flexibility required for an agile delivery, whereas an adaptive culture embraces change. By explicitly considering culture—often documented within the Management Approaches—the project management team ensures that the 'soft' people aspects effectively enable the 'hard' process mechanics of the methodology.

In the context of PRINCE2 7, the introduction of 'People' as a central integrated element highlights that projects are driven by human interaction, not just processes. Collaboration and Co-creation are essential behaviors within this element that determine the effectiveness of the project ecosystem.

Collaboration is the act of working together to achieve a common goal. Within a PRINCE2 project, this implies breaking down silos between the Project Board, the Project Manager, and the delivery teams. It requires establishing a culture where information flows freely, trust is established, and the project team operates as a unified entity rather than a group of individuals protecting their specific interests. Effective collaboration reduces friction during exception handling and facilitates smoother change control.

Co-creation elevates this interaction by focusing on the joint generation of value. It is particularly relevant to the interface between the project team (Supplier) and the stakeholders (User/Business). Instead of the project team delivering a solution 'to' the users based on static requirements, co-creation involves the users 'in' the development process. This ensures that the products delivered are fit for purpose and that the transition into operational use is seamless. It aligns directly with the PRINCE2 principle of 'Focus on products' but adds a human-centric layer, ensuring that the definition of quality includes the user's experience and specific context.

Ultimately, PRINCE2 7 emphasizes that while the method provides the structure (processes and themes), Collaboration and Co-creation provide the dynamic energy required to navigate complexity, ensure user adoption, and realize the projected business benefits.

In PRINCE2 7, the 'People' element is central to the method, recognizing that projects are planned, delivered, and used by people. Effective people management requires balancing diversity, capability, and competence.

**Diversity** in PRINCE2 extends beyond demographics to include cognitive diversity—different backgrounds, experiences, and ways of thinking. A diverse team mitigates 'groupthink,' enhances problem-solving, and improves risk identification. The project manager must foster an inclusive culture where psychological safety allows these diverse perspectives to be shared openly. This inclusion ensures that stakeholders' varying needs are understood and that the project solution is robust and fit for purpose.

**Capability** refers to the organizational level. It is the collective ability of the business to deliver projects and manage change. This encompasses the maturity of processes, the availability of resources, and the support structures (like a Project Management Office). The Project Board must ensure the organization has the capability to support the project’s scale and complexity. If organizational capability is low, the project management team must adapt the method, potentially adding more rigorous controls or assurance activities to compensate.

**Competence** focuses on the individual. It is the combination of skills, knowledge, experience, and behaviors required to perform a specific role effectively. PRINCE2 requires clearly defined roles and responsibilities, but defining a role is insufficient without an individual competent enough to fill it. The project manager must assess the competencies of team members against the requirements of the work packages. Where gaps exist, they must be addressed through training, coaching, or acquiring external resources.

Ultimately, success relies on appointing competent individuals to defined roles, supported by organizational capability, within a diverse team environment that drives innovation and better decision-making.