PROJECT CLOSE OUT; HOW TO HANDLE IT EFFECTIVELY

By JB Nartey · Jul 15, 2020
PROJECT CLOSE OUT;  HOW TO HANDLE IT EFFECTIVELY picture

INTRODUCTION

•The project closure is a major milestone in the life of a project and must be handled carefully and well.

•The manner in which a project is closed out will have a major impact on the ff;

•Quality of life in the organization.

•Success of the project.

•Residual attitudes toward the project held by senior management, the client, the project team, and other stakeholders.

•Organization’s successful use of projects in the future.

•Families and personal lives

•Working environment of the larger organization.

•Project closure is filled with mixed emotions.

KEY BENEFITS  

•Planned work is completed

•Client/Customer Satisfaction

•Project or Phase Information is archived for future projects

•Organisation team resources are released to pursue new endeavours

•Avoid Additional Cost

DEFINITION 

•Is the process of finalizing all activities for the project,phase or contract.

•Reviewing the PMP to ensure all project work is completed and that the project has met its goals & objectives

•This process is performed once at completion or at pre-defined points in the project; Gate or Milestone Reviews 

WHEN TO CLOSE OUT A PROJECT

•The criteria commonly applied for deciding whether to close out a project fall into two general categories:

•The project has successfully met its goals and objectives, and

•There is the likelihood that the project might be a failure; early termination 

WHO IS RESPONSIBLE

  • •All the Key stakeholders
    • •Project Manager
    • •Project Team
    • •Close Out Manager
    • •Close Out Committee
    • •Client
    • •Client’s Functional Department Heads.(Finance,Production,O&M)
    • •Production, O&M Team or Depts
    • •Project Beneficiaries/Users

PROJECT CLOSE OUT PROCESS 

  • Final Inspection & Acceptance of the Deliverables
  • Financial Closure & Acceptance
  • Project Staff/Team Close out
  • Dealing with Excess Project Material
  • Re-Allocating Project facilities ,equipment & other resources
  • Post Completion Evaluation
  • Post Completion Audit
  • Final Project Reports
  • Project Document final Updates & Closure ( Lessons Learnt Register Updates)
  • Index & Archive ALL Project Information
  • Deliverables Transition to Production, O&M –Training
  • Stakeholder Satisfaction Survey (Solicit feedback from the beneficiaries)

FINAL INSPECTION & ACCEPTANCE OF THE DELIVERABLES

  • PRACTICAL COMPLETION REQUEST
  • SNAGGING- PATENT DEFECTS/SNAG LIST
  • DE-SNAGGING- PATENT DEFECTS/SNAG CORRECTION LIST
  • PRACTICAL COMPLETION- PRACTICAL COMPLETION CERTIFICATE ISSUED
  • SNAG/DE-SNAG-PATENT DEFECTS
  • CLEARING THE SITE
  • COMPLETION-CERTIFICATE OF COMPLETION ISSUED
  • SITE HANDOVER
  • LATENT DEFECTS LIABILITY PERIOD – 6-12 MONTHS
  • SNAGGING/DE-SNAGGING - LATENT DEFECTS
  • FINAL COMPLETION- FINAL COMPLETION CERTIFICATE ISSUED
  • LATENT DEFECTS LIABILITY PERIOD- 5-10 YEARS

FINANCIAL CLOSURE & ACCEPTANCE

_FINAL ACCOUNTS,FINAL PAYMENT & CLOSE OUT REPORTS

  • •Pay off all Outstanding Invoices
  • •Close out all project related contracts
  • •Final Accounts
  • •Contractors/Service provider provides final accounts
  • •Approval of final Accounts
  • •Approval by the Employer
  • •Final Payment
  • •Payment of all outstanding claims
  • •Project Utility Accounts Closure & Transfer
  • •(Water,Electricity connections) to Employer

PROJECT STAFF/TEAM CLOSE OUT 

  • •Issue Appreciation Letters/Job Testimonials
  • •Release Project Staff Members; Verbal/Written
  • •Celebrate the project closure or close out; party
  • •Project Staff/Team Transfers/Re-Assignment
  • •Transfer back to duty in the individual’s parent department; Functional, Matrix  Organisations
  • •Transfer to other projects ; Pure project organization
  • •Project Staff/Team Lay Offs
  • •Lay offs of team members; Large Project
  • •Lay-offs ; pure project organization
  • •Lay-offs; matrix organization,
  • •The PM, PT and the Project parent organization’s HR department will aid loyal project workers in finding new employment.

DEALING WITH EXCESS/SURPLUS PROJECT MATERIAL

  • Hand over surplus materials to client and the cost for inclusion in the final account.
  • Sale of surplus materials
  • Dispose the Spoiled/Toxic Surplus Materials

RE-ALLOCATING PROJECT FACILITIES,EQUIPMENTS & OTHER RESOURCES

  • •Inform the facilities/resource management office about the works completion and site handover.
  • •Take a return inventory or list of all the facilities,equipment and resources to be  returned.
  • •Reconcile any differences between the original inventory and the return inventory to check for missing or stolen items
  • •Return all the listed borrowed or rented facilities, equipment and resources to their sources
  • •Re-allocate listed facilities,equipment and resources to another project

PROJECT POST COMPLETION EVALUATION OR APPRAISAL

  • •Evaluate the project progress and performance relative to the project’s initial or revised business plan/case.
  • •Evaluate the project performance against the Project’s initial or revised goals and objectives
  • •Evaluate the project performance relative to other similar projects.
  • •The project post completion evaluation, however, should not be limited simply to after-the- fact analysis or completion.
  • • Rather, it is useful to conduct an evaluation at a number of crucial points during the project life cycle; Gate or Milestone Appraisals.

PROJECT POST-COMPLETION AUDIT

  • •A very special type of evaluation is the formal audit.
  • •The project audit is a thorough examination of the management of a project, its methodology and procedures, its records, properties, inventories, budgets, expenditures, progress, and so on.
  • The project audit is not a financial audit, but is far broader in scope and may deal with the whole or any part of the project.
  • •It can also be very flexible, and can focus on any issues of interest to senior management.
  • •The project audit is also broader than the traditional management audit that focuses its attention on the organization’s management systems and operation.
  • •Example is the post completion project audit, often contractually required by the client as well as a common ingredient in the Final Project Report.

PROJECT FINAL/CLOSE OUT REPORT

  • •Upon achieving the project objectives or when the project is terminated for any other reason.
  • •The project manager needs to communicate project closure to the client to obtain financial acceptance and handover
  • •The project final report is a history of the project.
  • •It is a chronicle, typically written by the PM, of what went right and what went wrong, who served the project in what capacity, what was done, how it was managed, and the lessons learned.
  • •The project final report is not another evaluation, though the audits and evaluations have a role in it.

PROJECT DOCUMENTS FINAL UPDATES & CLOSURE

  • Project File Updates;
    • All project-related documents both soft and hard copies generated throughout the project lifecycle are updated and marked as final versions especially the lessons learnt register
  • Project Related Documents to be Updated and closed;
    • •Business Case/Plan,
    • •Project Charter,
    • •Project Scope Statement/Brief,
    • •Feasibility/Investigative Studies Reports
    • •Project Management Plan,PMP,
    • •Designs, Specifications & Design Reports ,
    • •Engineer’s/QS Cost Estimates,
    • •Procurement Evaluation/Adjudication Reports
    • •Reports; Special Investigative Reports, Progress Reports, Expenditure & Cost Reports, Cashflow Reports,
    • •Registers; Risk Register, Lessons Learnt Register, Stakeholder Register, Scope Change Register, Variation/Change Order Register, Issues Register
    • •Correspondences,
    • •Minutes of Meetings,
    • •Performance Data,
    • •Project Milestone Audit Reports

INDEX & ARCHIVE PROJECT INFORMATION RECORDS

Project Information Depository for project-related information generated throughout the project lifecycle.

What to Archive

Only Project-related information that is updated and closed

  • Key/Critical Information to be Archived;
    • Lessons Learned Register (Better Future Project Management Practices)
    • Procurement/Contract Administration documents ( Future Litigation)
  • All other project related information must be updated and closed.
    • •The Project Charter
    • •Project proposals & planning docs
    • •The Project Schedule
    • •The Status Report
    • •The Risk Register
    • •The Communications Plan
    • •designs,
    • •correspondences,
    • •reports,
    • •certificates,
    • •work variations etc

DELIVERABLES TRANSITION TO PRODUCTION OR O&M

_INTRODUCING A CHANGE INTO THE SYSTEM

A product, service, or result, once delivered by the project, may be handed over to a different group or organization that will produce, operate, maintain, and support it throughout its life cycle.

This process needs to be handled carefully to ensure a smooth handover or transition.

Deliverables Transition Process 

  • •Get the Production,O&M Team actively involved in the Project Closure/Close out process to ensure a smooth transition
  • Handover of works completion documentation
  • As built drawings & specifications
  • O&M Manuals
  • Testing certificates,COCs
  • Waranties/Guarantees
  • Mentorship/Training of the Production,O&M Team in the operation & maintenance of the deliverables

STAKEHOLDER SATISFACTION SURVEYS

  • •Stakeholder Feedback
  • •How happy are your stakeholders?
  • •It is a measure of project success
  • •Measure Key Stakeholder satisfaction with respect to the ff;
  • •Project Management efficiency; cost,time and deliverables
  • •Project Management effectiveness; Deliverable performance, impact/change

Please WhatsApp the PM GURU on +1 317 629 3820 if you want to know more about this topic 

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