Chapter 14

Project Audit and

Closure

McGraw-Hill/Irwin Copyright © 2008 by The McGraw-Hill Companies, Inc. All Rights Reserved.
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 Major Tasks of a Project Audit
1. Evaluate if the project delivered the
expected benefits to all stakeholders.
Was the project managed well?
Was the customer satisfied?
2. Assess what was done wrong and what
contributed to successes.
3. Identify changes to improve the delivery
of future projects.

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 Project Audit Components
 A review of why the project was selected
 A reassessment of the project’s role in the
organization’s priorities
 A check on the organizational culture to ensure it
facilitates the type of project being implemented
 An assessment of how well the project team is
functioning well and if its is appropriately staffed
 A check on external factors that might change
where the project is heading or its importance
 A review of all factors relevant to the project and
to managing future projects

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 Types of Project Audits
 In-Process Project Audits
 Allow for corrective changes if conditions
have changed and for concentration on
project progress and performance.
 Post-Project Audits
 Take a broader and longer-term view of the
project’s role in the organization and
emphasize improving the management of
future projects.

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Factors Influencing Audit Depth
and Detail
Organization size
Project importance
Project type
Project risk
Project size
Project problems

Table 14.1

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 Conducting a Project Audit
 Step 1: Initiation and Staffing
 Step 2: Data Collection and Analysis
 Step 3: Reporting

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Characteristics of Audit Leaders
1. No direct involvement or direct interest in the
project
2. Respect (perceived as impartial and fair) of senior
management and other project stakeholders
3. Willingness to listen
4. Independence and authority to report audit results
without fear of recriminations from special interests
5. Perceived as having the best interests of the
organization in making decisions
6. Broad-based experience in the organization or
industry

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Step 2: Data Collection and Analysis
 Organization View
 Was the organizational culture supportive and
correct?
 Was senior management’s support adequate?
 Did the project accomplish its intended purpose?
 Were risks appropriately identified and assessed?
 Were the right people and talents assigned?
 Have staff been fairly reassigned to new projects?
 What does evaluation from contractors suggest?
 Were the project start-up and hand-off successful?
 Is the customer satisfied?

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Step 2: Data Collection and Analysis
 Project Team View
 Were the project planning and control systems
appropriate for this type of project?
 Should all similar projects use these systems?
 Did the project conform to plan for budget and
schedule?
 Were interfaces with stakeholders effective?
 Have staff been fairly assigned to new projects?
 Did the team have adequate resources? Were there
resource conflicts?
 Was the team managed well?
 What does evaluation from contractors suggest?

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 Step 3: Reporting
 AuditReport Content
Outline  Recommendations

 Classification of project o Corrective actions

o Project type  Lessons learned
o Size o Reminders
o Staffing  Appendix
o Technology level o Backup data
o Strategic or support  Summary booklet
 Analysis of information
gathered
o Project mission and objectives
o Procedures and systems used
o Organization resources used

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 Project Closure
 Conditions for  Close-outPlan:
Closure Questions to be
 Normal Asked
 Premature  What tasks are
 Perpetual required to close the
 Failed Project
project?
 Who will be
 Changed Priority
responsible for these
tasks?
 When will closure
begin and end?
 How will the project be
delivered?

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 Barriers to Project Success
Activity* Barrier Incidence (%)
Planning Unclear definition 16%
32% Poor decision making 9
Bad information 3
Changes 4
Scheduling Tight schedule 4
12% Not meeting schedule 5
Not managing schedule 3
Organizing Lack of responsibility or accountability 5
11% Weak project manager 5
Top management interference 1
Staffing Inadequate personnel 5
12% Incompetent project manager 4
Project member turnover 2
Poor staffing process 1
Directing Poor coordination 9
26% Poor communication 6 *To interpret the table, note that
32 percent of the 1,654
Poor leadership 5 participants reported the
Low commitment 6 barriers under “Planning,” 12
Controlling Poor follow-up 3 percent reported the barriers
under “Scheduling,” and so on.
7% Poor monitoring 2
No control system 1
No recognition of problems 1 Table 14.2

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 Implementing Closedown
1. Getting delivery acceptance from the
customer
2. Shutting down resources and releasing to
new uses
3. Reassigning project team members
4. Closing accounts and seeing all bills are paid
5. Evaluating the project team, project team
members, and the project manager

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European Space Launch, AG—Project
Closure Checklist

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 Project Performance Evaluations
 Reasons for Poor-Quality Project Performance
Evaluations:
 Evaluations of individuals are still left to
supervisors of the team member’s home
department.
 Typical measures of team
performance center on
time, cost,
and specifications.

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Project Performance Evaluation: Team
 Are standards and goals for measuring performance Clear,
challenging, and attainable? Lead to positive consequences?
 Are responsibilities and performance standards known by all
team members?
 Are team rewards adequate? Management believes teams
are important?
 Is there a career path for successful project managers?
 Does the team have discretionary authority to manage short-
term difficulties?
 Is there a high level of trust within the organization culture?
 Are there criteria beyond time, cost, and specifications?

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Sample Team Evaluation
and Feedback Survey

TABLE 14.3

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 Project Performance Evaluation:
Individual
 Responsibility for Assessing Performance
 Functional organization or functional matrix: the
individual’s area manager
o The area manager may solicit the project manager’s opinion
of the individual’s performance on a specific project.
 Balanced matrix: the project manager and the area
manager jointly evaluate an individual’s performance.
 Projectmatrix and project organizations: the project
manager is responsible for appraising individual
performance.

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 Project Performance Evaluation:
Individual
 Multirater appraisal or the “360-degree
feedback”
 Involvessoliciting feedback concerning team
members’ performance from all the people their
work affects.
 This
includes project
managers, area managers,
peers, subordinates,
and even customers.

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 Conducting Performance Reviews
 Begin by asking the individual to evaluate his or her
own performance.
 Avoid drawing comparisons with other team
members; rather, assess the individual in terms of
established standards and expectations.
 Focus criticism on specific behaviors rather than on
the individual personally.
 Be consistent and fair in your treatment of all team
members.
 Treat the review as one point in an ongoing process.

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Key Points in Conducting Audits
 Have automatic times or points when audits will take
place. Surprises should be avoided.
 Conduct audits carefully and with sensitivity.
 Audit staff must independent from the project.
 Audit reports need to be used and accessible.
 Audits support organizational culture.
 Project closures should be planned and orderly.
 Certain “core conditions” must be in place to support
team and individual evaluation.
 Conduct individual and team evaluations separate
from pay or merit reviews.

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 Key Terms
In-process project audit
Performance review
Postproject audit
Project audit report
Project closure
Team evaluation
Three hundred and sixty
degree feedback

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