SPP Resource Allocation & Prioritization 4 — Questions and Answers
Question 1: The primary purpose of a Project Management Office (PMO) in the context of resource allocation is to:
- Approve all vendor contracts
- Provide centralized oversight and optimization of resource usage across the portfolio (Correct answer)
- Handle all HR recruitment activities
- Manage day-to-day operational tasks
Correct answer: Provide centralized oversight and optimization of resource usage across the portfolio
A PMO provides governance and visibility across projects, enabling optimized allocation of shared resources at the portfolio level.
Question 2: In strategic planning, 'capacity planning' primarily addresses:
- How many products can be stored in a warehouse
- Whether the organization has sufficient resources to execute its strategic plan (Correct answer)
- The maximum number of employees that can be hired annually
- IT infrastructure scalability for future data loads
Correct answer: Whether the organization has sufficient resources to execute its strategic plan
Capacity planning assesses whether current and projected resource levels are sufficient to deliver the strategy within required timeframes.
Question 3: Which concept describes the phenomenon where adding more resources to a late project often makes it later?
- Parkinson's Law
- Brooks's Law (Correct answer)
- Hofstadter's Law
- The Peter Principle
Correct answer: Brooks's Law
Brooks's Law states that adding manpower to a late software project makes it later due to ramp-up time and increased communication overhead.
Question 4: A company uses a 'strategic bucket' model for resource allocation. This means resources are:
- Distributed evenly across all active projects
- Pre-allocated to defined strategic categories before individual projects are selected (Correct answer)
- Reserved exclusively for the highest-revenue business unit
- Allocated only after all project risks are eliminated
Correct answer: Pre-allocated to defined strategic categories before individual projects are selected
Strategic buckets pre-assign resource pools to strategic themes, ensuring balance across innovation, growth, and maintenance priorities.
Question 5: When an organization must cut its project portfolio due to budget reductions, the BEST criterion for deciding which projects to eliminate is:
- Project duration (cut the longest ones first)
- Lowest strategic value combined with highest resource consumption (Correct answer)
- Projects managed by the least senior managers
- Projects that have already spent more than 50% of their budget
Correct answer: Lowest strategic value combined with highest resource consumption
Eliminating projects with low strategic value but high resource consumption frees maximum capacity for high-value initiatives.
Question 6: In Agile portfolio management, the concept of 'WIP limits' (Work in Progress limits) is applied to resource allocation to:
- Restrict the number of stories a developer can write
- Prevent teams from overcommitting by capping concurrent active initiatives (Correct answer)
- Limit the number of retrospectives held per quarter
- Constrain stakeholder feedback cycles
Correct answer: Prevent teams from overcommitting by capping concurrent active initiatives
WIP limits ensure teams focus by restricting how many initiatives can be in progress simultaneously, improving throughput and reducing context switching.
Question 7: A 'make-or-buy' analysis in resource allocation is used to determine:
- Whether to manufacture products domestically or overseas
- Whether to build capabilities internally or acquire them externally (Correct answer)
- Whether to invest in marketing or product development
- Whether to hire full-time employees or reduce headcount
Correct answer: Whether to build capabilities internally or acquire them externally
Make-or-buy analysis compares the cost and strategic implications of developing a capability in-house versus sourcing it from an external provider.
SPP Resource Allocation & Prioritization 4
The primary purpose of a Project Management Office (PMO) in the context of resource allocation is to: