13.2 Activities to Close a Project

The following sub-sections elaborate on the activities to close a project.

13.2.1    Ending the Implementation Phase

After we ensure that all the project activities are completed and the deliveries have been accepted by the client (the product owner and end users), we can start the activities to close the project. Once the project activities are completed in the implementation phase, we need to request the project sponsor to initiate a formal acceptance process through which the internal or external client (or the inspection/acceptance committee) is involved. They’re interested in knowing if the product or service of the project meets the objectives the project set out to accomplish. If our documentation is up-to-date, we will have the project results at hand to share with them.

In this phase, it is also of high importance to make sure that the implementation phase covered the post-project work composed of operation and maintenance. The project manager should ask the questions below to make sure that the project deliverables can be maintained and supported effectively after the deliverables are handed over to the client^[1].

Let’s consider the questions below for our m-commerce project:

• Does the vendor offer 24/7/365 support for the mobile app? Are the rates for such support acceptable to the client?
• Has a formal service level agreement been developed and put into effect between the organization and vendor to maintain continued support and service?
• What provisions have been made for future upgrades and enhancements of the mobile app?
• Does the necessary cloud capacity and storage exist for the future expansion of the system?
• Has Grocery LLC’s IT support staff been trained in supporting the technology? Can they resolve technical issues, or are they able to contact the vendor or third-party suppliers for further support?
• Has the help desk staff been trained to identify and log calls from users of the solution?
• Is the help desk number clearly displayed on the mobile app, so our in-store shoppers and customers know whom to contact?
• Has the project manager provided the help desk with a script of possible problems that users of the new solution could encounter?

13.2.2    Contract Closure

Contracts come to a close just as projects come to a close. Contracts are different from project charters and project management plans (Figure 13.3). They are legally binding documents with the client and the contractors or subcontractors. If the client is internal which means that it is a functional unit of our organization, we won’t need a contract. In this case, the project charter and the plans will act as formal documents that keep the project sponsor and the project manager accountable.

Contractors and subcontractors may be still present if some project activities or the overall project is outsourced to them. Therefore, not all projects require a contract closure process. Contract closure is concerned with completing and settling the terms of the contracts. In M-Commerce Project, as mentioned in Chapter 11, we outsourced the development component to a software company. We assumed that we need to pay $2,000 for each phase. Total cost baseline for all ten activities was $20,000 ($2,000 x 10). Therefore, our planned value was $20,000. When we finished five activities, the actual cost was $11,200. When closing the contracts, we should pay attention to the actual costs and the terms and conditions of the contract. The project manager should ask questions such as “Did the contractor finish all the activities and meet the requirements as indicated in the contract?”, “Are all the cost calculations correct?”, “Did we make all the payments?”, and “Do we need to wait for a while to make some payments as stipulated in the contract?”

The contract closure process supports the project completion process because it determines if the work described in the contracts was completed accurately and satisfactorily. Obviously, this process applies only to those phases, deliverables, or portions of the project that were performed under the contract. Contract closure updates the project records, detailing the final results of the work on the project. Contracts may have specific terms or conditions for completion. We should be aware of these terms or conditions so that project completion isn’t held up because we missed an important detail. If we are administering the contract ourselves, we should be sure to ask our procurement department if there are any special conditions that we should be aware of so that the project team doesn’t inadvertently delay contract project closure.

One of the purposes of the contract closure process is to provide formal notice to the seller, usually in written form, that the deliverables are acceptable and satisfactory or have been rejected. If the product or service does not meet the expectations, the vendor will need to correct the problems before we issue a formal acceptance notice. Before the contract is closed, any minor items that need to be repaired or completed are placed on a punch list, which is a list of all the items found by the client or team, or manager that still remain to be done. Hopefully, quality audits have been performed during the project, and the vendor was allowed to make corrections earlier in the process than the closing phase. It’s not a good idea to wait until the very end of the project and then spring all the problems and issues on the vendor at once. It’s much more efficient to discuss problems with the vendor as the project progresses because it provides the opportunity for correction when the problems occur.

The project team will then work on all of the items on the punch list, building a small schedule to complete the remaining work. If the number of items on the punch list is too large or the amount of work is significant, the project team continues to work on the project. Once the punch list becomes smaller, the project manager begins closing down the project, maintaining only enough staff and equipment to support the team that is working on the punch list.

If the product or service does meet the project’s expectations and is acceptable, formal written notice to the seller is required, indicating that the contract is complete. This is the formal acceptance and closure of the contract. It’s the project manager’s responsibility to document the formal acceptance of the contract. Many times, the provisions for formalizing acceptance and closing the contract are spelled out in the contract itself.

If we have a procurement department handling the contract administration, they will expect us to inform them when the contract is complete and will in turn follow the formal procedures to let the seller know the contract is complete. However, we will still note the contract completion in our copy of the project records.

13.2.3    Disbanding the Project Team and Reassigning All Project Resources

Project managers need to consider in an earlier stage what project team members would do after the project ends. If they are the employees of our organization, project managers should provide sufficient and early notification to the team members to relieve them of future concerns. They may go back to their functional departments to continue with their operational tasks or get assigned to a new project. If the organization has a Project Management Office (PMO), and these members work at this PMO, they will continue working on other projects. Project managers should keep their managers, or other project managers, informed as the project gets closer to completion, so that they have time to adequately plan for the return to their departments or transfer to other projects. Project managers should let them know a few months ahead of time what the schedule looks like and how soon they can plan on using the team members on new projects. This gives the other managers the ability to start planning activities and scheduling activity dates.

Besides the team members, we also need to consider other resources such as physical resources, facilities, materials, and equipment used by the team. If there are unused materials that cannot be returned to the supplier, and also consumables, they can be transferred to other projects or relevant departments so that they can use them and save some money. If the project team used office space, a manufacturing facility, or a lab, the facilities department of the organization must be notified. Timely notifications would help the organization plan in advance for the utilization of these resources by other projects and units, or if they need to be sold or released.

13.2.4    Final Payments

The final payments are usually more than a simple percentage of the work that remains to be completed. Completing the project might involve fixing the most difficult problems that are disproportionately expensive to solve, so the final payment should be large enough to motivate the vendor to give the project a high priority so that the project can be completed on time.

If the contractors, subcontractors, suppliers, and vendors have met all the contractual obligations, including fixing problems and making repairs as noted on a punch list, which lists the work that doesn’t conform to contract specifications, the project team signs off on the contract and submits it to the accounting department for final payment. They are notified that the last payment is final and completes the contractual agreement with the project. Besides, the performance of suppliers and vendors is reviewed to determine if they should still be included in the list of qualified suppliers or vendors.

In some cases, there may be a provisional acceptance instead of a final acceptance. Thus, the final acceptance may take place later (e.g., one year after the provisional acceptance). A small amount of payment may be held for the final acceptance. Or the contract may contain fines in case of problems that may occur until the final acceptance.

13.2.5    Administrative Closure & Archiving of Project Documents

The project manager must ensure that all the administrative tasks required to close the project have been completed. Thus, the project manager can use a checklist as shown in Table 13.2.

Table 13.2: A Checklist for the Administrative Closure^[2]

The following are some of the project documents that are archived:

• Business case, needs assessment, and project benefits management plan
• Project charter
• Project management plan and its sub-plans (e.g., plans for scope, requirements, schedule, cost, quality, resources, communication, risks, procurement, stakeholders, change, and configuration)
• Scope, schedule, and cost baselines
• Basis of estimates
• Team charter
• Risk register
• Issue log
• Quality reports
• Test and evaluation documents
• Inspection and acceptance reports
• All financial documents (e.g., pay stubs, invoices)
• Lessons learned register
• Final project report

The documents associated with the project must be stored in a safe location where they can be retrieved for future reference. Signed contracts or other documents that might be used in tax reviews or lawsuits must be stored. Organizations have legal document storage and retrieval policies that apply to project documents and must be followed. Generally, organizations and Project Management Offices (PMOs) store all the project documents in an electronic folder and/or a software program.

Care should be taken to store documents in a form that can be recovered easily. If the documents are stored electronically, standard naming conventions should be used so documents can be sorted and grouped by name. If documents are stored in paper form, the expiration date of the documents should be determined so they can be destroyed at some point in the future.

13.2.6    Sample Sponsor Project Closure Letter

A sample letter a project sponsor can write has been provided below^[3]:

Dear <Salutation>,

Thank you for allowing us the honor of working on <Project X>.  We found working with both yourself and your organization to be a fruitful experience and are pleased to present the following results:

• The successful outcome of <Project X>
  • <Deliverable 1>
  • <Deliverable 2>
  • <Deliverable 3>
• The expected delivery date of<MM/DD/YYYY> was met
• The project came in at <percent over/under budget>
• Surveyed stakeholder approval was <#> out of <#>

At this time, we consider <Project X> to be completed and are submitting our final invoice for $<XX,XXX> to your accounts receivable department under your purchase order number <P.O. Number>. Your help in securing payment for our services will be appreciated.

Additionally, during the project, we identified the following potential opportunities for your review:

• <Improvement A>
• <Improvement B>
• <Improvement C>

Should you be interested in pursuing any of these options and/or additional opportunities, please consider utilizing our organization so we can leverage our skills and experience with you. Again, thank you for selecting us to work on your project.  If you have any questions or comments, please do not hesitate to contact me.

Sincerely,

Project Sponsor