Chapter 6

Closing the Project

The PMP exam content from the Closing the Project performance domain covered in this chapter includes the following:

• Obtain final acceptance of the project deliverables by working with the sponsor and/or customer, in order to confirm that project scope and deliverables were met.
• Transfer the ownership of deliverables to the assigned stakeholders in accordance with the project plan, in order to facilitate project closure.
• Obtain financial, legal, and administrative closure using generally accepted practices, in order to communicate formal project closure and ensure no further liability.
• Distribute the final project report including all project closure-related information, project variances, and any issues, in order to provide the final project status to all stakeholders.
• Collate lessons learned through comprehensive project review, in order to create and/or update the organization’s knowledge base.
• Archive project documents and materials in order to retain organizational knowledge, comply with statutory requirements, and ensure availability of data for potential use in future projects and internal/external audits.
• Measure customer satisfaction at the end of the project by capturing customer feedback, in order to assist in project evaluation and enhance customer relationships.

Closing is the final process group of the five project management process groups and accounts for 8 percent of the questions on the PMP exam. The primary purpose of Closing is to formally complete the project, phase, or contractual obligations. Finalizing all of the activities across the project management process groups accomplishes this.

By the end of the processes that make up the Closing process group, the completion of the defined processes across all of the process groups will have been verified.

Obtaining Final Acceptance

All projects must be formally closed out regardless of the reasons for closure (such as successful completion or early termination). According to the PMBOK® Guide, the following typically occurs during formal closing of the project or project phase:

• Obtaining formal acceptance by the customer or sponsor
• Closing out procurement contracts
• Conducting phase-end or post-project reviews
• Updating the organizational process assets, which includes documenting lessons learned and archiving project documents in the project management information system (PMIS)
• Recording the impacts of tailoring to any process

These activities are carried out through the Close Project or Phase process and the Close Procurements process.

Close Project or Phase

The Close Project or Phase process is concerned with gathering project records and disseminating information to formalize the acceptance of the product, service, or result. The process belongs to the Project Integration Management Knowledge Area. Here are additional notes about the process you should know:

• It involves analyzing the project management processes to determine their effectiveness.
• It documents lessons learned concerning the project processes.
• It archives all project documents for historical reference. You can probably guess that Close Project or Phase belongs to the Project Integration Management Knowledge Area since this process touches so many areas of the project.

According to the PMBOK® Guide, every project requires closure, and the completion of each project phase requires project closure as well. The Close Project or Phase process is performed at the close of each project phase and at the close of the project.

Figure 6-1 shows the inputs, tools and techniques, and outputs of the Close Project or Phase process.

Inputs of Close Project or Phase

For the exam, know the three inputs of the Close Project or Phase process.

Project Management Plan To consider the project closed, the project management plan will be reviewed by the project manager to ensure completion of the deliverables.

Accepted Deliverables Accepted deliverables are an output of the Verify Scope process. This input is necessary to determine whether all deliverables have been successfully completed.

Organizational Process Assets The following organizational process assets are typically utilized within this process:

• Guidelines for closing out the project or project phase
• Historical information and lessons learned
• Project closure reports updated as part of the Plan Communications process

Tools and Techniques of Close Project or Phase

The Close Project or Phase process has only one tool and technique: expert judgment.

Subject matter experts can help assure that the process is performed according to the organization’s standard and to project management standards.

Outputs of Close Project or Phase

There are two outputs that result from carrying out the Close Project or Phase process.

Final Product, Service, or Result Transition Final product, service, or result transition refers to the acceptance of the product and the turnover to the customer or into operations. This is where information is distributed that formalizes project completion.

Organizational Process Assets Updates The following organizational process assets are typically updated as a result of the Close Project or Phase process:

• Project files, such as the project planning documents, change records and logs, and issue logs
• Project or phase closure documents, which include documentation showing that the project or phase is completed and that the transfer of the product of the project to the organization has occurred
• Project closure reports
• Historical information, which is used to document the successes and failures of the project

Close Procurements

The Close Procurements process is primarily concerned with completing and settling the terms of the procurement. It supports the Close Project or Phase process by determining whether the work described in the procurement documentation or contract was completed accurately and satisfactorily, which is referred to as product verification.

The Close Procurements process also accomplishes the following:

• Updating and archiving records for future reference
• Completing all terms or conditions for completion and closeout specified within the procurement contracts
• Documenting and verifying project outcomes

Figure 6-2 shows the inputs, tools and techniques, and outputs of the Close Procurements process.

Inputs of Close Procurements

The Close Procurements process has a total of two inputs that you should be familiar with: project management plan and procurement documentation.

Project Management Plan The project management plan contains the procurement management plan, which will be used to carry out this process.

Procurement Documentation According to the PMBOK® Guide, the following documents from within the procurement documentation input are collected, indexed, and filed:

• Contract schedule
• Scope
• Quality
• Cost performance
• Contract change documentation
• Payment records
• Inspection results

Tools and Techniques of Close Procurements

For the exam, be familiar with the three tools and techniques of the Close Procurements process.

Procurement Audits Procurement audits are structured reviews that span all of the procurement processes. The primary purpose of these audits is to identify lessons learned by examining the procurement processes to determine areas of improvement and to identify flawed processes or procedures.

Negotiated Settlements Negotiated settlements occur when using an alternative dispute resolution (ADR) technique due to outstanding issues or claims. Reaching a negotiated settlement through the aid of ADR techniques is the most favorable way to resolve a dispute.

Records Management System The records management system contains processes, control functions, and automation tools to help manage contract and procurement documentation and records.

Outputs of Close Procurements

You should know the two outputs of the Close Procurements process, which are closed procurements and organizational process assets updates.

Closed Procurements Closed procurements are the formal acceptance and closure of the procurements. As Figure 6-3 illustrates, this output satisfies the terms and conditions specified within the contract; it is also included within the procurement management plan.

Organizational Process Assets Updates Updates to the organizational process assets, as a result of carrying out this process, are typically made to the following items:

• Procurement file, which includes all of the procurement records and supporting documents
• Deliverable acceptance, which is a formal written notice from the buyer that the deliverables are acceptable and satisfactory or have been rejected
• Lessons learned documentation

Transferring Ownership

The acceptance and turnover of the product to the customer or into operations typically involves a formal sign-off indicating that those signing accept the product of the project. This occurs as a result of carrying out the Close Project or Phase process, which was discussed earlier within this chapter.

Obtaining Financial, Legal, and Administrative Closure

Aside from the two closing processes, there are a few additional items to note about the Closing process group and finalizing the project’s closure. To start, project or phase closure is carried out in a formal manner and requires that financial, legal, and administrative closure be obtained. This is important to communicating formal closure and to ensuring that no further liability exists after the project has been completed.

It’s important to note that a project can move into the Closing process group for several reasons:

• It’s completed successfully.
• It’s canceled or killed prior to completion.
• It evolves into ongoing operations and no longer exists as a project.

Formal Project Endings

Aside from these common reasons that result in a project moving into the Closing processes, there are four formal types of project endings that you should be familiar with: addition, starvation, integration, and extinction.

Addition A project that evolves into ongoing operations is considered a project that ends because of addition, moving into its own ongoing business unit. Once it experiences this transition, it no longer meets the definition of a project.

Starvation Starvation occurs when resources are cut off from a project prior to the completion of all the requirements. This results in an unfinished project. Starvation often occurs as a result of shifting priorities, a customer’s cancellation of an order or request, the project budget being reduced, or key resources quitting.

Integration Integration occurs when the resources of a project (such as people, equipment, property, and supplies) are distributed to other areas in the organization or are assigned to other projects. In other words, resources have been reassigned or redeployed, causing an end to the project.

Extinction Extinction occurs when a project has completed and stakeholders have accepted the end result. This is the best type of ending because the project team has completed what they set out to achieve.

In all cases, it’s important to retain good documentation that describes why a project ended early. Performing a project review in these cases is important to retaining key details and specifics regarding why a project ended before all requirements were completed.

Trends

Another notable piece of information involves stakeholder influence and cost trends that occur during project closure. Stakeholders tend to have the least amount of influence during the Closing processes, while project managers have the greatest amount of influence. Costs are significantly lower during the Closing processes because the majority of the project work and spending have already occurred.

Administrative Closure

As part of administrative closure, resources will need to be released and the administrative closure procedures carried out.

Release Resources

Although releasing project team members is not an official process, you will release your project team members at the conclusion of the project, and they will go back to their functional managers or be assigned to a new project if you’re working in a matrix-type organization. The release of project resources is addressed within the staff release plan.

The staff release plan is one of the items within the staffing management plan, which in turn is included within the human resource plan, a subsidiary project management plan. The following are the primary items covered in the staff release plan, which includes the release of resources not just at the end of the project, but in general at any point within the project:

• Outlines the method for resource release
• Defines when resources are to be released

Once resources are released, the costs of the resources are no longer charged to the project. The staff release plan helps mitigate human resource risks that may occur during or at the conclusion of the project.

Perform Administrative Closure

Administrative closure procedures involve the following:

• Collecting all the records associated with the project
• Analyzing the project success (or failure)
• Documenting and gathering lessons learned
• Properly archiving project records
• Documenting the project team members’ and stakeholders’ roles and responsibilities:
  • Approval requirements of the stakeholders for project deliverables and changes to deliverables
  • Confirmation that the project meets the requirements of the stakeholders, customers, and sponsor
  • Documented actions to verify that the deliverables have been accepted and exit criteria have been met

Figure 6-4 shows the elements of the administrative closure procedures.

Distributing the Final Project Report

As part of formally closing out a project, the project manager will need to create and distribute the final project report. This generally occurs as part of the Close Project or Phase process, where administrative details are addressed. The final project report should include all project closure–related details, project variances, and any issues. The project manager should ensure that final project status is distributed to the stakeholders.

Collating Lessons Learned

One of the recurring themes communicated across the PMBOK® Guide is the proactive nature carried out by the project manager, expressed by their actions. An example of being proactive is documenting lessons learned, which becomes part of the organizational process assets.

Documenting lessons learned, as mentioned previously, focuses on capturing what went well within the project, what didn’t go well, and what can be improved. Although lessons learned are recorded throughout the life of the project, holding a final review with the project team before the team is released at the end of the project is essential. This information can be captured through a comprehensive project review with stakeholders and then added to the organization’s knowledge base.

Documenting lessons learned occurs as part of the Close Project or Phase process, through the organizational process assets updates output.

Archiving Project Documents

As part of the Close Project or Phase process, project documents are archived. This occurs through the organizational process assets updates output, which makes the historical documents available for future reference and use. Archiving project documents provides the following benefits:

• Retaining organizational knowledge
• Ensuring that statutory requirements, if applicable, are adhered to
• Making project data available for use in future projects
• Making project data available for internal/external audits

Measuring Customer Satisfaction

According to the PMBOK® Guide, project success is measured by the following criteria:

• Product and project quality
• Timeliness
• Budget compliance
• Degree of customer satisfaction

Customer satisfaction is an important goal you’re striving for in any project. If your customer is satisfied, it means you’ve met their expectations and delivered the product or service as defined within the planning processes. Customer satisfaction can be measured through quality management, which in part is concerned with making sure that customer requirements are met. This is done through understanding, evaluating, defining, and managing customer and stakeholder expectations.

As Figure 6-5 illustrates, modern quality management achieves customer satisfaction in part by ensuring that the project accomplishes what it set out to do (conformance to requirements) and that it satisfies real needs (fitness for use).

Bringing the Processes Together

The Closing process group consists of only two processes that work toward closing out the project or project phase. Before closing out the project, the project manager must first make sure that the project has met its objectives and accomplished what it set out to achieve. The Closing process group is also concerned with the following objectives:

• Obtaining formal acceptance of the project’s completion
• Closing out procurement contracts
• Releasing the project resources
• Measuring customer satisfaction
• Archiving the project information for later use

Figure 6-6 reflects the objectives of the Closing process group through several key questions that the project manager should ask before considering the project fully closed.

Next, we’ll go through the two closing processes and review the interactions that occur within them.

Project Integration Management Knowledge Area Review

A project closeout cannot occur without first finalizing all project or phase activities. The Close Project or Phase process from within the Project Integration Management Knowledge Area is responsible for making this happen. Figure 6-7 shows what occurs within this process. The accepted deliverables are used to verify that the project or the project phase has accomplished what it needed to.

The Close Project or Phase process is also responsible for administrative closure of the project or project phase. The result is the transition to the customer of the final product, service, or result that the project created.

Before a project can be fully closed, all of the project documents must be archived within the organizational process assets. As you may recall, this includes all of the project files, any closing documents, and historical information. The historical information is archived within the lessons learned knowledge base, which will be a valuable asset to future projects.

Project Procurement Management Knowledge Area Review

All procurement contracts must be completed and closed out before the project itself can close. This means that any loose ends or work on the vendor’s end must be finalized as part of closing activities. This occurs through the Close Procurements process, which is the only closing-related process within the Project Procurement Management Knowledge Area. As Figure 6-8 illustrates, information from the project management plan and the procurement documents are used in closing out the procurement contracts.

Keep in mind that procurement contracts may terminate without completion of the work. Remember that this is a special circumstance and all parties must mutually agree upon early termination.

You may have already noticed that the Close Project or Phase and the Close Procurements processes work together. Both processes confirm that the work has been completed and verified. You’ll also notice that the Close Project or Phase process cannot end until the Close Procurements process has been completed.

Review Questions

1. All of the following are inputs of the Close Project or Phase process EXCEPT:

A. Procurement documentation

B. Project management plan

C. Accepted deliverables

D. Organizational process assets

2. A project manager of a travel excursion company is currently working on confirming that all project deliverables have been successfully completed to transfer the project to the customer. What process is the project currently in?

A. Verify Scope

B. Scope Closure

C. Close Project or Phase

D. Close Procurements

3. When closing out a project or project phase, which of the following tools and techniques can be utilized to ensure that closure has been performed to the appropriate standards?

A. Records management system

B. Procurement audits

C. Expert judgment

D. Organizational process assets

4. The Close Procurements process accomplishes all of the following EXCEPT:

A. Updating and archiving records for future reference

B. Completing closeout terms or conditions as specified within the procurement contracts

C. Documenting and verifying project outcomes

D. Transitioning the final product, service, or result to the organization

5. While conducting project closure activities, a relatively new project manager of a white board production company becomes confused as to how the organization verifies that the existing criteria have been met. The project manager has found that some of the procedures followed by the organization are different from previous companies she’s worked for. Where can the project manager go to clarify the procedures for verifying that the exit criteria have been met?

A. Administrative closure procedures

B. Close Project or Phase

C. Close Procurements

D. Expert judgment

6. All of the following are tools and techniques of the Close Procurements process EXCEPT:

A. Procurement documentation

B. Procurement audits

C. Negotiated settlements

D. Record management system

7. Procurement audits are concerned with which of the following?

A. Resolving issues

B. Documenting the processes, control functions, and automation tools

C. Identifying flawed scope processes

D. Identifying lessons learned

8. A project manager was in the midst of trying to resolve a dispute with one of the project’s largest vendors. The issue revolved around the responsibility of the vendor to comply with changes to the scope. Although this was addressed in the contract, the vendor felt that the scope changes were much larger than the scope of the contract itself. What would be the BEST way to resolve the dispute?

A. Through the court system

B. Using an alternative dispute resolution technique

C. Terminating the contract

D. Making changes to the contract

9. Project managers have the greatest amount of influence during which stage of the project?

A. Prior to the start of the project

B. During the Planning processes

C. During execution of the project work

D. During the Closing processes

10. Resource release criteria can BEST be found in which plan?

A. The project management plan

B. The staff release plan

C. The staffing management plan

D. The human resource plan

Answers to Review Questions

1. A. Procurement documentation is an input utilized within the Close Procurements process, the second and only other process within the Closing process group. Options B, C, and D are the only three inputs of the Close Project or Phase process.

2. C. You may have leaned toward selecting option A at first glance because deliverables are verified during the Verify Scope process. However, the project manager is currently confirming that “all deliverables” of the project have been successfully accomplished, not verifying the actual deliverables themselves. To make this determination, the Close Project or Phase process utilizes the project management plan and the list of accepted deliverables.

3. C. This question refers to the Close Project or Phase process, which has only one tool and technique: expert judgment. This is used when performing administrative closure. Options A and B are tools and techniques of the Close Procurements process, and option D is an input to the Close Project or Phase process.

4. D. Transferring the final product, service, or result is an activity and output of the Close Project or Phase process.

5. A. In this scenario, the project manager would refer to the administrative closure procedures. These procedures address several closure items, such as collecting project records, analyzing the success of the project, and documenting the roles and responsibilities of the project team members and stakeholders. As part of the latter, the administrative closure procedures document the actions to verify that the project deliverables have been accepted and that the exit criteria have been met.

6. A. Procurement documentation is an input to the Close Procurements process.

7. D. Procurement audits are structured reviews spanning all of the procurement processes. These audits are concerned with identifying lessons learned and identifying flawed processes or procedures. As a side note, option A refers to negotiated settlements, option B refers to the record management system, and option C does not refer to a specific audit process.

8. B. Disputes or outstanding claims are resolved by using alternative dispute resolution techniques, which is considered to be the most favorable way of resolving disputes. Option A, taking the dispute to court, is the least favorable resolution technique.

9. D. The project manager has the greatest amount of influence during the Closing processes, while stakeholders have the least amount of influence during this stage of the project.

10. B. This is a tricky question because all of the options are technically correct. However, the question asks for the best answer. This would be option B, the staff release plan. The staff release plan is part of the staffing management plan, which is part of the human resource plan, which is part of the project management plan.