This document discusses the environment in which projects operate. It identifies factors both internal and external to an organization that can influence projects, such as organizational culture, resource availability, marketplace conditions, and legal restrictions. It also discusses organizational process assets, knowledge repositories, and governance frameworks that provide resources and guidance for projects. The roles and characteristics of the project manager are defined, including their sphere of influence over stakeholders, sponsors, and team members. Competencies for project managers are outlined, including technical project management skills, strategic and business management skills, and leadership skills.