Project Management: Achieving Competitive Advantage, 4e (Pinto)
Chapter 14 Project Closeout and Termination
1) The project was over, so each worker went back to her usual assignment, taking with them the
notebook they were issued when the project began. They never were sure whether the project had
been successful or unsuccessful, but they could be positive that the project was terminated by:
A) Extinction.
B) Addition.
C) Integration.
D) Starvation.
Answer: A
Diff: 2
Section: 14.1 Types of Project Termination
LO: 14.1: Distinguish among the four main forms of project termination.
Classification: Concept
AACSB: Application of Knowledge
2) Termination by addition occurs when:
A) Scope creep adds too many activities to the project that prevent it from being completed on
time or within budget.
B) The project is so successful that it becomes institutionalized.
C) A new project is added to the organization and it commands all of the resources for the
original project.
D) New members join the project team once the project has begun and their skills are insufficient
to successfully complete the project.
Answer: B
Diff: 2
Section: 14.1 Types of Project Termination
LO: 14.1: Distinguish among the four main forms of project termination.
Classification: Concept
AACSB: Application of Knowledge
3) Once the project was successfully concluded, the team members returned to their roles in the
organization, occasionally congregating at the water cooler to relive their halcyon days of yore.
No one could argue that their project was:
A) Terminated by extinction.
B) Terminated by addition.
C) Terminated by integration.
D) Terminated by starvation.
Answer: C
Diff: 2
Section: 14.1 Types of Project Termination
LO: 14.1: Distinguish among the four main forms of project termination.
Classification: Application
AACSB: Application of Knowledge
4) The departmental patriarch spent his last years at the university developing and promoting a
Student Portfolio Project that required all departmental faculty to create integrated course
projects and maintain a database of their students' work. New graduates could refer their
prospective employers to the Student Portfolio Project database to mine examples of their work.
The patriarch retired, funding and effort dried up, and the project lingered in a few syllabi and on
the department's web site for a year or two but now any mention of it elicits either puzzled looks
or wry grins from the remaining faculty. The patriarch's Student Portfolio Project has officially
been terminated by:
A) Extinction.
B) Addition.
C) Integration.
D) Starvation.
Answer: D
Diff: 2
Section: 14.1 Types of Project Termination
LO: 14.1: Distinguish among the four main forms of project termination.
Classification: Application
AACSB: Application of Knowledge
5) Which two types of project termination are reserved for successful projects?
A) Addition and integration
B) Integration and starvation
C) Starvation and extinction
D) Extinction and addition
Answer: A
Diff: 2
Section: 14.1 Types of Project Termination
LO: 14.1: Distinguish among the four main forms of project termination.
Classification: Concept
AACSB: Application of Knowledge
6) Which two types of project termination can occur for unsuccessful projects?
A) Integration and starvation
B) Starvation and extinction
C) Extinction and addition
D) Addition and integration
Answer: B
Diff: 2
Section: 14.1 Types of Project Termination
LO: 14.1: Distinguish among the four main forms of project termination.
Classification: Concept
AACSB: Application of Knowledge
7) Which type of project termination can occur for a project that is successful and for a project
that is unsuccessful?
A) Termination by addition
B) Termination by integration
C) Termination by extinction
D) Termination by starvation
Answer: C
Diff: 2
Section: 14.1 Types of Project Termination
LO: 14.1: Distinguish among the four main forms of project termination.
Classification: Concept
AACSB: Application of Knowledge
8) A successful project that also creates a need for a change to organizational structure is
probably terminated by:
A) Extinction.
B) Integration.
C) Starvation.
D) Addition.
Answer: D
Diff: 2
Section: 14.1 Types of Project Termination
LO: 14.1: Distinguish among the four main forms of project termination.
Classification: Concept
AACSB: Application of Knowledge
9) The emeritus physics professor taught at the university for forty years and had built quite a
following in the community and an enviable LinkedIn network of alumni donors. The university
was loath to ask him to retire, so they set up a lab where he could pursue his two passions, a
perpetual motion machine and cold fusion, either of which would solve the world's energy
problems. As the years passed, the budget was held constant and suffered due to the rise in prices
for perpetual motion machine parts. Cold fusion material certainly wasn't getting any cheaper
either, and it was evident to all the other physicists that the project was subjected to termination
by:
A) Extinction.
B) Integration.
C) Starvation.
D) Addition.
Answer: C
Diff: 2
Section: 14.1 Types of Project Termination
LO: 14.1: Distinguish among the four main forms of project termination.
Classification: Concept
AACSB: Application of Knowledge
10) In August 2012, after twenty years in development, the combination heart monitor-ashtray
for hospital intensive care patients was finally terminated, a victim of the change in the social
acceptability of smoking in general and in particular, smoking by hospital patients. This is an
example of natural termination.
Answer: FALSE
Diff: 1
Section: 14.0 Introduction
LO: 14.1: Distinguish among the four main forms of project termination.
Classification: Concept
AACSB: Application of Knowledge
11) The trailer had been reinforced, re-decked and had a fresh coat of paint. It was fully complete
and finally ready for a run to Kansas City to pick up a rebounding son. This project has achieved
natural termination.
Answer: TRUE
Diff: 1
Section: 14.0 Introduction
LO: 14.1: Distinguish among the four main forms of project termination.
Classification: Concept
AACSB: Application of Knowledge
12) A project that is terminated by extinction is not completed successfully.
Answer: FALSE
Diff: 1
Section: 14.1 Types of Project Termination
LO: 14.1: Distinguish among the four main forms of project termination.
Classification: Concept
AACSB: Application of Knowledge
13) Termination by addition and termination by integration both represent successful project
completion.
Answer: TRUE
Diff: 2
Section: 14.1 Types of Project Termination
LO: 14.1: Distinguish among the four main forms of project termination.
Classification: Concept
AACSB: Application of Knowledge
14) The new dean was completely uninterested in international programs, so he selected the least
competent faculty to serve on the committee and took away their doughnut budget, effectively
terminating the project by starvation.
Answer: TRUE
Diff: 2
Section: 14.1 Types of Project Termination
LO: 14.1: Distinguish among the four main forms of project termination.
Classification: Concept
AACSB: Application of Knowledge
15) What is the difference between natural termination and unnatural termination of a project?
Provide an example of each.
Answer: In natural termination, the project has achieved its goals and is moving towards its
logical conclusion. In unnatural termination, a shift in political, economic, customer or
technological conditions has rendered the project without purpose. Examples will vary.
Diff: 2
Section: 14.0 Introduction
LO: 14.1: Distinguish among the four main forms of project termination.
Classification: Application
AACSB: Application of Knowledge
16) How do the four types of project termination differ?
Answer: There are four chief reasons for projects to be terminated: by extinction, addition,
integration, and starvation. Terminations by addition and by integration both occur when a
project has been successful; a termination by addition project is so successful to the point of
being more successful than imagined. The project organization institutionalizes the project as a
formal part of the organization. Termination by integration officially brings the project resources
into the organization. Termination by extinction can occur when a project has been successful or
unsuccessful. In the successful case, the project is transferred to its intended users and all final
phase-out activities are conducted. In the unsuccessful stage the project work is stopped and
human resources return to their starting points. Termination by starvation amounts to benign
neglect; a project is officially kept open although no work progresses and no new resources are
assigned.
Diff: 2
Section: 14.1 Types of Project Termination
LO: 14.1: Distinguish among the four main forms of project termination.
Classification: Application
AACSB: Application of Knowledge
17) The final items that are left to accomplish or correct at the end of a construction project are
on the:
A) Punch list.
B) Check list.
C) Check sheet.
D) Errata sheet.
Answer: A
Diff: 1
Section: 14.2 Natural Termination - The Closeout Process
LO: 14.2: Recognize the seven key steps in formal project closeout.
Classification: Concept
AACSB: Application of Knowledge
18) Of the project closeout management steps listed, the first is to:
A) Hand over the project.
B) Finish the work.
C) Gain acceptance for the product.
D) Review how it all went.
Answer: B
Diff: 1
Section: 14.2 Natural Termination - The Closeout Process
LO: 14.2: Recognize the seven key steps in formal project closeout.
Classification: Concept
AACSB: Application of Knowledge
19) Of the project closeout management steps listed, the last is to:
A) Hand over the project.
B) Finish the work.
C) Gain acceptance for the product.
D) Review how it all went.
Answer: D
Diff: 1
Section: 14.2 Natural Termination - The Closeout Process
LO: 14.2: Recognize the seven key steps in formal project closeout.
Classification: Concept
AACSB: Application of Knowledge
20) Which of these project closeout management steps listed is ongoing throughout the closeout
process?
A) Disband the team
B) Finish the work
C) Gain acceptance for the product
D) Review how it all went
Answer: A
Diff: 1
Section: 14.2 Natural Termination - The Closeout Process
LO: 14.2: Recognize the seven key steps in formal project closeout.
Classification: Concept
AACSB: Application of Knowledge
21) A significant challenge during the finishing the work element of project closeout
management is to:
A) Demonstrate viability of the project.
B) Gain customer acceptance of the product.
C) Maintain focus on the current project.
D) Capitalize on new opportunities that arise from this project.
Answer: C
Diff: 2
Section: 14.2 Natural Termination - The Closeout Process
LO: 14.2: Recognize the seven key steps in formal project closeout.
Classification: Concept
AACSB: Application of Knowledge
22) The PFI arrangement in the United Kingdom for projects is an acronym for:
A) Project Failure Insurance.
B) Profiterole Filling Inclusion.
C) Private Finance Initiative.
D) Primary Figure Investment.
Answer: C
Diff: 2
Section: 14.2 Natural Termination - The Closeout Process
LO: 14.2: Recognize the seven key steps in formal project closeout.
Classification: Concept
AACSB: Application of Knowledge
23) The BOT option for large projects is designed to:
A) Automate the payment process.
B) Automate the closeout process.
C) Keep the door open for new projects between the customer and project organization.
D) Limit risk for the customer in the short run.
Answer: D
Diff: 2
Section: 14.2 Natural Termination - The Closeout Process
LO: 14.2: Recognize the seven key steps in formal project closeout.
Classification: Concept
AACSB: Application of Knowledge
24) Under the BOT option for a project:
A) The project organization must operate the work product of the project for a while.
B) The customer organization must accept the work product of the project at the scheduled
delivery date.
C) The project organization may build the work product to their own specifications instead of the
customer's.
D) The customer organization transfers employees to the project organization for the duration of
the project.
Answer: A
Diff: 2
Section: 14.2 Natural Termination - The Closeout Process
LO: 14.2: Recognize the seven key steps in formal project closeout.
Classification: Concept
AACSB: Application of Knowledge
25) The difference between a BOT contract and a BOOT contract is that under the BOOT
contract:
A) The customer must observe all phases of the project process before the product is handed
over.
B) The project organization is obligated to complete the project on time.
C) The project organization must take initial ownership of the product.
D) The customer must organize the project's resources for the project organization.
Answer: C
Diff: 2
Section: 14.2 Natural Termination - The Closeout Process
LO: 14.2: Recognize the seven key steps in formal project closeout.
Classification: Concept
AACSB: Application of Knowledge
26) The disadvantage of a BOOT contract to the project organization is that they must take on:
A) Higher safety risks.
B) Higher failure risks.
C) Higher financial risks.
D) Higher competitive risks.
Answer: C
Diff: 2
Section: 14.2 Natural Termination - The Closeout Process
LO: 14.2: Recognize the seven key steps in formal project closeout.
Classification: Concept
AACSB: Application of Knowledge
27) A research study on the critical success factors for projects found that an important
determination of whether the project is successful is the element of:
A) Putting it all to bed.
B) Reviewing how it all went.
C) Disbanding the team.
D) Gaining acceptance for the product.
Answer: D
Diff: 2
Section: 14.2 Natural Termination - The Closeout Process
LO: 14.2: Recognize the seven key steps in formal project closeout.
Classification: Concept
AACSB: Application of Knowledge
28) In order to facilitate acceptance for the project, the project team should start planning for the
project's transfer and use during:
A) The project development phase.
B) The project termination phase.
C) The project close-out phase.
D) The project work phase.
Answer: A
Diff: 2
Section: 14.2 Natural Termination - The Closeout Process
LO: 14.2: Recognize the seven key steps in formal project closeout.
Classification: Application
AACSB: Application of Knowledge
29) The key to begin harvesting the benefits of a project is to first develop an effective:
A) Client relationship with the project team.
B) Measurement system for project use and value assessment.
C) BOOT agreement that clearly stipulates when transfer of title occurs.
D) Enterprise resource planning package to manage human, financial, and material resources.
Answer: A
Diff: 2
Section: 14.2 Natural Termination - The Closeout Process
LO: 14.2: Recognize the seven key steps in formal project closeout.
Classification: Concept
AACSB: Application of Knowledge
30) Systematic errors could be BEST described as:
A) The result of a one-time occurrence.
B) The result of an external cause.
C) The result of some freak accident.
D) The result of an internal cause.
Answer: D
Diff: 2
Section: 14.2 Natural Termination - The Closeout Process
LO: 14.2: Recognize the seven key steps in formal project closeout.
Classification: Concept
AACSB: Application of Knowledge
31) A lessons-learned analysis falls under the project closeout management element of:
A) Heviewing how it all went.
B) handing over the product.
C) Finishing the work.
D) Putting it all to bed.
Answer: A
Diff: 1
Section: 14.2 Natural Termination - The Closeout Process
LO: 14.2: Recognize the seven key steps in formal project closeout.
Classification: Concept
AACSB: Application of Knowledge
32) The project review session was one epiphany after another for the project organization. A
number of systematic errors were properly identified and the root causes of a number of
problems were identified. Sadly, the review session was not leveraged to its fullest extent thanks
to:
A) The disbanding of the project team.
B) Failure to enforce the archiving of this knowledge.
C) A restrictive BOOT contract.
D) A liberal BOT contract.
Answer: B
Diff: 2
Section: 14.2 Natural Termination - The Closeout Process
LO: 14.2: Recognize the seven key steps in formal project closeout.
Classification: Application
AACSB: Application of Knowledge
33) An important guideline to follow in a lessons-learned meeting is to:
A) Make sure to properly assign blame for all that went wrong.
B) Make sure that events receive necessary spin.
C) Fix the problems.
D) Include all stakeholders.
Answer: C
Diff: 2
Section: 14.2 Natural Termination - The Closeout Process
LO: 14.2: Recognize the seven key steps in formal project closeout.
Classification: Concept
AACSB: Application of Knowledge
34) The goal of a lessons-learned meeting is to recapitulate the series of events:
A) As subjectively as possible.
B) From the project manager's viewpoint.
C) As intuitively as possible.
D) From all possible viewpoints.
Answer: D
Diff: 2
Section: 14.2 Natural Termination - The Closeout Process
LO: 14.2: Recognize the seven key steps in formal project closeout.
Classification: Concept
AACSB: Application of Knowledge
35) The closeout step that requires all contractual documents be recorded and archived is:
A) Putting it all to bed.
B) Finishing the work.
C) Reviewing how it all went.
D) Harvesting the benefits.
Answer: A
Diff: 2
Section: 14.2 Natural Termination - The Closeout Process
LO: 14.2: Recognize the seven key steps in formal project closeout.
Classification: Concept
AACSB: Application of Knowledge
36) Research clearly indicates that when team members have experienced positive psychosocial
outcomes from a project:
A) They are actually less likely to work collaboratively in the future.
B) They tend to fear future projects because they feel the law of averages will catch up with
them.
C) Their enthusiasm level wanes due to mental and physical exhaustion.
D) They are more likely to work collaboratively in the future.
Answer: D
Diff: 2
Section: 14.2 Natural Termination - The Closeout Process
LO: 14.2: Recognize the seven key steps in formal project closeout.
Classification: Concept
AACSB: Application of Knowledge
37) Disbanding the project team should be:
A) Celebrated so there is motivation for future projects.
B) Done in a highly structured manner.
C) Done in a highly informal manner.
D) Handled in an off-hand manner.
Answer: A
Diff: 1
Section: 14.2 Natural Termination - The Closeout Process
LO: 14.2: Recognize the seven key steps in formal project closeout.
Classification: Application
AACSB: Application of Knowledge
38) Which statement about project closeout activities is BEST?
A) Closeout activities are usually given a high priority.
B) Getting the project signed off discourages other closeout activities.
C) Because all projects are unique, the actual carryover from project to project is minimal.
D) Closeout activities are impossible to ignore.
Answer: B
Diff: 1
Section: 14.2 Natural Termination - The Closeout Process
LO: 14.2: Recognize the seven key steps in formal project closeout.
Classification: Concept
AACSB: Application of Knowledge
39) All projects are unique:
A) Therefore all project management circumstances are equally unique.
B) So knowledge cannot be transferred.
C) But they may have several common points.
D) So knowledge should not be transferred to avoid bias in future projects.
Answer: C
Diff: 2
Section: 14.2 Natural Termination - The Closeout Process
LO: 14.2: Recognize the seven key steps in formal project closeout.
Classification: Concept
AACSB: Application of Knowledge
40) Lessons-learned analysis is BEST described as:
A) A bookkeeping process.
B) A personnel reassignment process.
C) A pressure relief process.
D) An organizational learning process.
Answer: D
Diff: 2
Section: 14.2 Natural Termination - The Closeout Process
LO: 14.2: Recognize the seven key steps in formal project closeout.
Classification: Concept
AACSB: Application of Knowledge
41) In the United States, a Private Finance Initiative is used to protect the excessive financial
exposure of a contracting agency to a project being developed.
Answer: FALSE
Diff: 2
Section: 14.2 Natural Termination - The Closeout Process
LO: 14.2: Recognize the seven key steps in formal project closeout.
Classification: Concept
AACSB: Application of Knowledge
42) The build, operate, transfer option for projects requires the project contractor to take initial
ownership of the project in order to make sure it works, thus mitigating risk in the short run.
Answer: FALSE
Diff: 2
Section: 14.2 Natural Termination - The Closeout Process
LO: 14.2: Recognize the seven key steps in formal project closeout.
Classification: Concept
AACSB: Application of Knowledge
43) Systematic errors are not one-time incidents, but instead represent built-in components of the
project management process.
Answer: TRUE
Diff: 2
Section: 14.2 Natural Termination - The Closeout Process
LO: 14.2: Recognize the seven key steps in formal project closeout.
Classification: Concept
AACSB: Application of Knowledge
44) The actual carryover from one project to another is minimal because projects are unique,
one-time events.
Answer: FALSE
Diff: 2
Section: 14.2 Natural Termination - The Closeout Process
LO: 14.2: Recognize the seven key steps in formal project closeout.
Classification: Concept
AACSB: Application of Knowledge
45) Closeout activities are typically among the highest priority activities in a project.
Answer: FALSE
Diff: 2
Section: 14.2 Natural Termination - The Closeout Process
LO: 14.2: Recognize the seven key steps in formal project closeout.
Classification: Concept
AACSB: Application of Knowledge
46) One major deterrent to effective project closeout is client acceptance of the project.
Answer: TRUE
Diff: 2
Section: 14.2 Natural Termination - The Closeout Process
LO: 14.2: Recognize the seven key steps in formal project closeout.
Classification: Concept
AACSB: Application of Knowledge
47) Sketch the Seven Elements of Project Closeout Management model and discuss what takes
place at each step.
Answer: The seven elements of project closeout management are represented in the diagram
below:
Finishing the work — This element is just as described; there are always final tasks that require
polish or a punch list of items to repair before the project is officially finished.
Handing over the product — Transferring ownership requires more than just handing over the
keys; it may include training, transfer of technical knowledge, or a highly structured
ownership/operating agreement while the project work product is proven to be error free.
Gaining acceptance for the product — Gaining acceptance may take considerable effort to
convince the customer that they can operate and rely on the project.
Harvesting the benefits — This can take the form of financial benefits, public appeal beyond that
of stakeholders, future business awarded on the basis of this work product, or other advancement
for the project organization.
Reviewing how it all went — This entails a thoughtful lessons-learned analysis that describes
successes and failures and includes analysis on how to capitalize on knowledge gained from this
venture.
Putting it all to bed — This step closes out all of the paperwork; the legal, cost, and personnel
records and all documentation and correspondence relating to the project.
Disbanding the team — The project team is dismissed to go to their regular duties or on to the
next project with a formal or informal discharge by the project manager and organization.
Diff: 3
Section: 14.2 Natural Termination - The Closeout Process
LO: 14.2: Recognize the seven key steps in formal project closeout.
Classification: Concept
AACSB: Application of Knowledge
48) What are three different ways that a project can be handed over from the project organization
to the client? Describe their differences.
Answer: Transferring the project to the intended user can be one that is straightforward or one
that is complex, such as a BOT or BOOT, depending on contractual terms. With all types of
transfers, the project transition period may entail training, transfer of engineering blueprints or
other technical know-how, or other service after the sale.
A straightforward transfer is easiest on the project organization but has the highest level of risk
for the customer. The BOT (build, operate and transfer) concept is a method for allowing the
eventual owner to mitigate risk in the short run by having the project organization operate the
project for a time to ensure that all features are functional. The BOOT (build, own, operate,
transfer) option takes this a step further by requiring the project organization to own the project's
work product during this trial period. This adds an element of risk to the project organization.
Diff: 2
Section: 14.2 Natural Termination - The Closeout Process
LO: 14.2: Recognize the seven key steps in formal project closeout.
Classification: Application
AACSB: Application of Knowledge
49) What can a project organization do to increase the likelihood of acceptance for the final
product of the project?
Answer: The process of gaining customer acceptance can be complicated so it is necessary to
begin planning well in advance for both the transfer of the final product to the client and the
creation of a program to ease their transition to ownership. This sequence suggests that a plan for
acceptance and transfer of ownership should be part of the initial project plan. The project team
should identify possible objections and concerns regarding the project and develop
countermeasures to these concerns as work progresses. Project transfer contracts such as BOT
and BOOT options can help instill confidence as would detailed training and follow-up on the
part of the project organization.
Diff: 2
Section: 14.2 Natural Termination - The Closeout Process
LO: 14.2: Recognize the seven key steps in formal project closeout.
Classification: Application
AACSB: Application of Knowledge
50) Review the project sign-off documents contained in Appendix 14.1. How can these forms be
improved?
Answer: The tables in Appendix 14.1 elicit a wide variety of information from all number of
potential project participants. Suggestions for improvement will vary, but may include using the
documents in electronic form, increasing the space available for comments or providing a means
to display lengthier responses on another sheet, and providing some means of dating some
entries that are time-specific.
Diff: 2
Section: 14.2 Natural Termination - The Closeout Process
LO: 14.2: Recognize the seven key steps in formal project closeout.
Classification: Critical Thinking
AACSB: Reflective Thinking
51) What are the keys to begin harvesting the benefits of a project? What are the major
components of a meaningful project assessment system and how does an assessment system help
the project organization?
Answer: The key to begin harvesting the benefits of a project is to first develop an effective and
meaningful measurement system that identifies goals, time frame, and responsibilities involved
in project use and value assessment. At a minimum, a project assessment system should measure
the following:
The criteria by which benefits of the project or service will be measured.
The points in time at which the measurement or assessment will be carried out.
The individual who has accepted responsibility for carrying out the measurement or assessment
in the agreed way at the agreed points in time.
Diff: 2
Section: 14.2 Natural Termination - The Closeout Process
LO: 14.2: Recognize the seven key steps in formal project closeout.
Classification: Application
AACSB: Application of Knowledge
52) What is a lessons-learned meeting with regards to project management? Describe the
benefits and behaviors of such a meeting.
Answer: A lessons-learned meeting is a post-project review that examines the project process
and how it served the project organization well and where it might have failed. The potential
benefits of a lessons-learned meeting are enormous. The project organization can uncover better
ways of organizing the entire range of their project work. These lessons, if properly archived and
disseminated, can become part of the organization's knowledge base. During such a meeting
there are three important guidelines for project teams to follow:
Establish clear rules of behavior for all parties to the meeting.
Describe as objectively as possible what occurred.
Fix the problem not the blame.
Diff: 2
Section: 14.2 Natural Termination - The Closeout Process
LO: 14.2: Recognize the seven key steps in formal project closeout.
Classification: Application
AACSB: Application of Knowledge
53) What are any two common mistakes in a post-project lessons-learned meeting?
Answer: The author presents three common errors:
Misidentifying systematic errors. It is human nature to attribute failures or mistakes to external
causes, rather than internal reasons. Closely related to this error is the desire to perceive mistakes
as one-time or nonrecurring events. Rather than looking at our project management systems to
see if the mistakes could be the result of underlying problems with them, many of us prefer the
easier solution of believing that these results were unpredictable, that they were a one-time
occurrence and not likely to recur, and that therefore we could not have prepared for them and do
not need to prepare for them in the future.
Misapplying or misinterpreting appropriate lessons based on events. A related error of
misinterpretation occurs when project team members or those reviewing the project wrongfully
perceive the source of an encountered problem. Sometimes the correct lessons from a terminated
project are either ignored or altered to reflect a prevailing viewpoint.
Failing to pass along lessons-learned conclusions. Although it is true that an organization's
projects are characterized as discrete, one-time processes, they do retain enough areas of overlap,
particularly within a single firm's sphere, to make the application of lessons-learned programs
extremely useful.
Diff: 2
Section: 14.2 Natural Termination - The Closeout Process
LO: 14.2: Recognize the seven key steps in formal project closeout.
Classification: Application
AACSB: Application of Knowledge
54) What three guidelines are offered to derive maximum benefit from a lessons-learned
meeting? Provide counter examples for each one of these behaviors.
Answer: During a lessons-learned meeting there are three important guidelines for project teams
to follow: 1) Establish clear rules of behavior for all parties to the meeting; 2) Describe as
objectively as possible what occurred; and 3) Fix the problem not the blame. Counter examples
will vary, but will hopefully be entertaining.
Diff: 2
Section: 14.2 Natural Termination - The Closeout Process
LO: 14.2: Recognize the seven key steps in formal project closeout.
Classification: Application
AACSB: Application of Knowledge
55) What are the major types of paperwork that must be closed out at the end of a project? What
are some elements of each type?
Answer: The end of a project requires the close out of a substantial amount of paperwork that
document and record processes, close resources, and track contractual obligations. Some of the
major types of paperwork include:
Documentation — All pertinent records must be archived including schedule and planning
documents, all monitoring and control materials, any records of materials or other resource
usage, customer change requests, and specification change approvals.
Legal — All contractual agreements must be filed and archived.
Cost — All accounting records must be carefully closed out including cost accounting records,
lists of materiel, major purchases, and budgetary items. All cost accounts must be closed and
unused funds or budget reverted back to the company budget.
Personnel — The costs and other charges for all project team personnel must be accounted for,
their time charged against project accounts, and any company overhead in the form of benefits
identified.
Diff: 2
Section: 14.2 Natural Termination - The Closeout Process
LO: 14.2: Recognize the seven key steps in formal project closeout.
Classification: Application
AACSB: Application of Knowledge
56) What are any four items that prevent effective project closeouts and how can each be
avoided?
Answer: The author lists five common reasons why project closeout is handled haphazardly or
ineffectively in many companies. These reasons, and possible countermeasures are shown in the
table.
Reasons
Getting the project signed off
discourages other closeout activities.
The assumed urgency of all projects
pressures us to take shortcuts on the
back end.
Closeout activities are given a low
priority and are easily ignored.
Countermeasures
Don't issue the final OK until closeout is
completed. Withhold a significant reward
until all personnel have completed all of
their duties.
Emphasize the importance of final closeout
activities. Don't start too many new projects
before existing ones or limit the company to
a certain number of open projects.
Emphasize the importance of final closeout
activities. Demonstrate the value of previous
closeout activities and the pitfalls associated
with rushing this important step.
Keep lessons-learned analyses on display
and on workers' minds for a longer period
once the project is completed. Review
lessons-learned at current project meetings
whenever possible.
Lessons-learned analysis is simply
viewed as a bookkeeping process.
People may assume that because all
projects are unique, the actual carryover Draw parallels from old projects to new
from project to project is minimal.
ones to carry over common themes.
Diff: 2
Section: 14.2 Natural Termination - The Closeout Process
LO: 14.2: Recognize the seven key steps in formal project closeout.
Classification: Application
AACSB: Application of Knowledge
57) A static factor that may lead to early termination for a project is:
A) Less capital availability.
B) High sunk costs.
C) Intermittent rewards.
D) Loss of the project champion.
Answer: B
Diff: 3
Section: 14.3 Early Termination for Projects
LO: 14.3: Understand key reasons for early termination of projects.
Classification: Application
AACSB: Application of Knowledge
58) Research indicates that the number one reason for terminating research and development
projects is:
A) That the project is found to be inconsistent with organizational goals.
B) The project costs more to complete than originally planned.
C) The low probability of achieving technical or commercial success.
D) Increased government restrictions.
Answer: C
Diff: 3
Section: 14.3 Early Termination for Projects
LO: 14.3: Understand key reasons for early termination of projects.
Classification: Concept
AACSB: Application of Knowledge
59) Which of these factors weighs heavily in the decision to terminate a project?
A) Inability to protect results
B) Increased market receptiveness
C) Meeting project cost milestones
D) Low probability of return on investment
Answer: D
Diff: 2
Section: 14.3 Early Termination for Projects
LO: 14.3: Understand key reasons for early termination of projects.
Classification: Concept
AACSB: Application of Knowledge
60) A behavioral issue that is crucial to maintaining the ongoing viability of a project is:
A) Worker commitment.
B) Increasing importance to the firm.
C) Financial impact to the company.
D) Relatively minor technical problems.
Answer: A
Diff: 2
Section: 14.3 Early Termination for Projects
LO: 14.3: Understand key reasons for early termination of projects.
Classification: Concept
AACSB: Application of Knowledge
61) Surveys on the early warning signs of project failure indicate that a red flag for failure is:
A) The time to complete the project lengthens.
B) The lack of viable commercial objectives.
C) The political forces have turned against the project.
D) The benefits of the project won't be realized until the end.
Answer: B
Diff: 2
Section: 14.3 Early Termination for Projects
LO: 14.3: Understand key reasons for early termination of projects.
Classification: Concept
AACSB: Application of Knowledge
62) Researchers have determined that one significant early warning sign of project failure is:
A) The time to complete the project lengthens.
B) The rewards were available on an intermittent basis.
C) The new product being developed was targeting a market that few new products and firms
were entering or exiting.
D) There was little prior experience on the project team.
Answer: C
Diff: 2
Section: 14.3 Early Termination for Projects
LO: 14.3: Understand key reasons for early termination of projects.
Classification: Concept
AACSB: Application of Knowledge
63) Which of these statements about early termination decisions is BEST?
A) The decision to pull the plug is usually clear-cut.
B) A project's viability is usually a purely internal issue.
C) Projects that can fulfill a useful purpose in the marketplace are not killed.
D) External reasons, such as a change in the organization's environment, are often the reasons for
project termination.
Answer: D
Diff: 2
Section: 14.3 Early Termination for Projects
LO: 14.3: Understand key reasons for early termination of projects.
Classification: Application
AACSB: Application of Knowledge
64) A mainframe computer company decided to enter the personal computer market with its
Floridian Project, but subsequently decided to leave the market to focus on the mainframe
business. The decision rule that they probably applied was to get out:
A) When the project no longer meets strategic fit criteria.
B) When deadlines continue to be missed.
C) When project personnel turn over too rapidly.
D) When technology evolves beyond the project's scope.
Answer: A
Diff: 2
Section: 14.3 Early Termination for Projects
LO: 14.3: Understand key reasons for early termination of projects.
Classification: Application
AACSB: Application of Knowledge
65) The rapid evolution of technology and the need to freeze a project's scope can combine to
render a project:
A) Too costly to complete.
B) Obsolete before it can be finished.
C) A poor fit with current company strategy.
D) So complex that it will take too long to complete.
Answer: B
Diff: 2
Section: 14.3 Early Termination for Projects
LO: 14.3: Understand key reasons for early termination of projects.
Classification: Application
AACSB: Application of Knowledge
66) The work breakdown for project termination issues can be broadly categorized into:
A) Emotional and devotional issues.
B) Visceral and discrete issues.
C) Intellectual and intersectional issues.
D) Intellectual and emotional issues.
Answer: D
Diff: 2
Section: 14.3 Early Termination for Projects
LO: 14.3: Understand key reasons for early termination of projects.
Classification: Concept
AACSB: Application of Knowledge
67) Loss of team identity is:
A) An emotional staff issue.
B) An emotional client issue.
C) An intellectual internal issue.
D) An intellectual external issue.
Answer: A
Diff: 2
Section: 14.3 Early Termination for Projects
LO: 14.3: Understand key reasons for early termination of projects.
Classification: Concept
AACSB: Application of Knowledge
68) Construction of the largest egg in the world seemed like a good idea when the Pixley city
council awarded Halliburton the construction contract, but as the weeks turned into months the
idea had lost much of its charm. What emotional issues might the project team be facing?
A) Availability of key personnel
B) Loss of project-derived motivation
C) Disposal of unused material
D) Communicating closure
Answer: B
Diff: 2
Section: 14.3 Early Termination for Projects
LO: 14.3: Understand key reasons for early termination of projects.
Classification: Concept
AACSB: Application of Knowledge
69) An internal intellectual issue that arises when a project is terminated is:
A) Agreement with suppliers on outstanding commitments.
B) Closing down facilities.
C) Identification of remaining deliverables.
D) Determinants of requirements for audit trail data.
Answer: C
Diff: 2
Section: 14.3 Early Termination for Projects
LO: 14.3: Understand key reasons for early termination of projects.
Classification: Concept
AACSB: Application of Knowledge
70) When a project is shut down, the project team must ensure that all relevant stakeholders are
clearly aware of the project shut down, including the date by which all activities will cease. This
is an:
A) Intellectual and internal issue.
B) Emotional issue of the project team.
C) Emotional issue of the clients.
D) Intellectual and external issue.
Answer: D
Diff: 2
Section: 14.3 Early Termination for Projects
LO: 14.3: Understand key reasons for early termination of projects.
Classification: Concept
AACSB: Application of Knowledge
71) Projects accumulate quantities of unused supplies and materials. It is imperative that an
organization have a method for disposing of these materials when a project is terminated. This
issue is:
A) Intellectual and internal.
B) Intellectual and external.
C) Emotional and of the project team.
D) Emotional and of the client.
Answer: A
Diff: 2
Section: 14.3 Early Termination for Projects
LO: 14.3: Understand key reasons for early termination of projects.
Classification: Concept
AACSB: Application of Knowledge
72) Many times, clients will shift new people into the project who have no experience with it as
they move their key people to new challenges. This issue is:
A) An emotional one for the project team.
B) An emotional one for the clients.
C) One that is internal and intellectual.
D) One that is external and intellectual.
Answer: B
Diff: 2
Section: 14.3 Early Termination for Projects
LO: 14.3: Understand key reasons for early termination of projects.
Classification: Concept
AACSB: Application of Knowledge
73) The Microserf was in a blind panic; now that the latest version of the Bob operating system
was ready for sale, he would have to latch onto a new project team or face life on the mean
streets of Redmond. This is indubitably an:
A) Emotional issue for the clients.
B) Internal, intellectual issue.
C) Emotional issue for the project team.
D) External, intellectual issue.
Answer: C
Diff: 2
Section: 14.3 Early Termination for Projects
LO: 14.3: Understand key reasons for early termination of projects.
Classification: Application
AACSB: Application of Knowledge
74) An example of an external intellectual issue is:
A) The control of charges to the project.
B) The screening of partially completed tasks.
C) The identification of outstanding commitments.
D) The determinants of requirements for audit trail data.
Answer: D
Diff: 2
Section: 14.3 Early Termination for Projects
LO: 14.3: Understand key reasons for early termination of projects.
Classification: Concept
AACSB: Application of Knowledge
75) An ex-gratia claim made when a project is closed down is made when:
A) There is no contractual basis for a claim.
B) The project company fails to perform to the terms of the contract.
C) The client company fails to perform to the terms of the contract.
D) A third party causes either the client or project company to fail to perform to the terms of the
contract.
Answer: A
Diff: 2
Section: 14.3 Early Termination for Projects
LO: 14.3: Understand key reasons for early termination of projects.
Classification: Concept
AACSB: Application of Knowledge
76) When contractual claims are defaulted due to the failure of a project to be completed and
delivered:
A) The client firm should file an ex-gratia claim.
B) The client firm may have some legal claim to punitive damages.
C) The project firm should file an ex-gratia claim.
D) The project firm may have some legal claim to recovery.
Answer: B
Diff: 2
Section: 14.3 Early Termination for Projects
LO: 14.3: Understand key reasons for early termination of projects.
Classification: Concept
AACSB: Application of Knowledge
77) The formalized system of dealing with grievances and administering corrective justice to
parties in a bargaining position is:
A) Collective bargaining.
B) Distributive justice.
C) Arbitration.
D) Compensation.
Answer: C
Diff: 2
Section: 14.3 Early Termination for Projects
LO: 14.3: Understand key reasons for early termination of projects.
Classification: Concept
AACSB: Application of Knowledge
78) Binding arbitration:
A) Requires that a terminated project be completed before damages are awarded.
B) Requires empanelment of equal numbers from both the client and project organizations to
reach a verdict.
C) Should be used to settle disputes only if the principle of caveat emptor does not apply.
D) Can settle outstanding claims or disputes provided that all parties agree to its use.
Answer: D
Diff: 2
Section: 14.3 Early Termination for Projects
LO: 14.3: Understand key reasons for early termination of projects.
Classification: Concept
AACSB: Application of Knowledge
79) In non-binding arbitration:
A) The judge can offer suggestions for dispute resolution but cannot enforce these opinions.
B) The two parties agree to open up, or unbind, their books for inspection by the other party.
C) The client and project organizations both agree to perform exactly what the judge decrees.
D) The client and project organizations are not bound by the rules of law.
Answer: A
Diff: 2
Section: 14.3 Early Termination for Projects
LO: 14.3: Understand key reasons for early termination of projects.
Classification: Concept
AACSB: Application of Knowledge
80) Static factors that may play a role in the decision to terminate a project early include
company image and the presence of high sunk costs.
Answer: TRUE
Diff: 2
Section: 14.3 Early Termination for Projects
LO: 14.3: Understand key reasons for early termination of projects.
Classification: Concept
AACSB: Application of Knowledge
81) A classic early warning sign of project failure is the realization that a product being
developed was targeting a market that few new products and firms were entering.
Answer: TRUE
Diff: 2
Section: 14.3 Early Termination for Projects
LO: 14.3: Understand key reasons for early termination of projects.
Classification: Concept
AACSB: Application of Knowledge
82) Loss of team identity during project termination is a significant internal intellectual issue.
Answer: FALSE
Diff: 2
Section: 14.3 Early Termination for Projects
LO: 14.3: Understand key reasons for early termination of projects.
Classification: Concept
AACSB: Application of Knowledge
83) Arbitration refers to the formalized system for dealing with grievances and administering
corrective justice to parties in a bargaining situation.
Answer: TRUE
Diff: 2
Section: 14.3 Early Termination for Projects
LO: 14.3: Understand key reasons for early termination of projects.
Classification: Concept
AACSB: Application of Knowledge
84) What are the six major categories of factors that may influence the decision to terminate a
project early? Provide examples of each.
Answer: Researchers have identified six categories of factors that influence the decision to
terminate a project before its time. These factors include:
static factors like prior experience, company image, and political forces;
task team factors such as difficulty achieving technical performance, loss of enthusiasm, and
missing milestones;
sponsorship factors, including lower impact on the company, less importance to the firm, and
loss of project champion;
economic factors such as lower projected ROI, less capital availability, and missing cost
milestones;
environmental factors like increased competition and increased government restrictions; and
user factors of market need obviated, market factors changed and reduced likelihood of
successful commercialization.
Diff: 2
Section: 14.3 Early Termination for Projects
LO: 14.3: Understand key reasons for early termination of projects.
Classification: Application
AACSB: Application of Knowledge
85) Describe the four early warning signs of project failure.
Answer: One study attempted to determine the warning signs of early project termination before
the decision had, in fact, been made. The four early warning signs identified by the study were
that the project had a low probability of achieving commercial objectives, not possessing team
members with sufficient decision authority, projects that were targeted into relatively stable
markets, and those that were given low priority by top R&D management.
Diff: 2
Section: 14.3 Early Termination for Projects
LO: 14.3: Understand key reasons for early termination of projects.
Classification: Application
AACSB: Application of Knowledge
86) Describe and rank any three decision rules for terminating an ongoing project before
completion.
Answer: Answers will vary with students' rankings. The decision rules listed in the text include
the following:
When cost exceeds business benefits.
When the project no longer meets strategic fit criteria.
When deadlines continue to be missed.
When technology evolves beyond the project's scope.
The latter may not be a concern in many situations; evolution of technology probably hasn't
cancelled a home construction project for a while. Costs exceeding benefits may be critical for
smaller firms and extremely large corporations may be less sensitive to cost issues.
Diff: 2
Section: 14.3 Early Termination for Projects
LO: 14.3: Understand key reasons for early termination of projects.
Classification: Critical Thinking
AACSB: Analytical Thinking
87) What are the four major categories in the work breakdown structure for project termination?
Provide examples of specific tasks within each of these four categories.
Answer: Work breakdown structure for project termination issues can be divided into an
emotional and an intellectual half. The emotional side can be divided into staff and client sides.
The intellectual half can be divided into internal and external halves. Emotional staff issues
include the fear of no future work, diversion of effort, and loss of interest in remaining tasks.
Emotional client issues include a change in attitude, loss of interest in the project, and
unavailability of key personnel. Intellectual internal issues include certification needs, control of
charges to the project, and disposal of unused material. Intellectual external issues include
communicating closure, closing down facilities, and agreement with suppliers on outstanding
commitments.
Diff: 2
Section: 14.3 Early Termination for Projects
LO: 14.3: Understand key reasons for early termination of projects.
Classification: Concept
AACSB: Application of Knowledge
88) What are the two types of claims that can arise in the event of project closure and why would
one be chosen over another?
Answer: There are two common types of claims that can arise in the event of project closure, exgratia and default. Ex-gratia claims are made by a client when there is no contractual basis for
the claim. The client considers that because of some unexpected event there is a moral or
commercial obligation on the project organization to pay compensation. When contractual claims
are defaulted due to the failure of a project to be completed and delivered, the client firm may
have some legal claim to cost recovery or punitive damages. The discrepancy between the two
rides on whether a contract has been broken; if so, then the project company is in default; if not,
then an ex-gratia claim must be filed.
Diff: 2
Section: 14.3 Early Termination for Projects
LO: 14.3: Understand key reasons for early termination of projects.
Classification: Application
AACSB: Analytical Thinking
89) What is arbitration, how does it work, when is it used and what are the two different types?
Answer: Arbitration is a formalized system for dealing with grievances and administering
corrective justice to parties in a bargaining situation. If two or more parties disagree on the
nature of contractual terms and conditions, a third party, usually a court-appointed arbitrator,
facilitates the settlement of the disputed terms. If all parties agree to the use of arbitration, it can
serve as a binding settlement to all outstanding claims or disputes arising from a contract that
was not adequately completed. Parties may adopt non-binding arbitration, in which case the
judge can offer suggestions or avenues for settlement but cannot enforce these opinions.
Diff: 2
Section: 14.3 Early Termination for Projects
LO: 14.3: Understand key reasons for early termination of projects.
Classification: Concept
AACSB: Application of Knowledge
90) The final project report should answer questions related to project performance, such as:
A) How the organization's operating structure either helped or hindered the project team and
their efforts.
B) How the project fared compared to baseline schedule and budget.
C) How consistently the organization estimated the completion time for activities.
D) How close the project came to achieving its goals.
Answer: B
Diff: 2
Section: 14.4 Preparing the Final Project Report
LO: 14.4: Know the challenges and components of a final project.
Classification: Concept
AACSB: Application of Knowledge
91) Administrative performance review is an important component of the final project report.
Which item is a key facet of administrative performance?
A) The method of assuring that project team members have adequate training
B) The method of determining activity and resource costs
C) The method of determining the number of signatures in the change order process
D) The method of measuring stakeholder satisfaction
Answer: C
Diff: 1
Section: 14.4 Preparing the Final Project Report
LO: 14.4: Know the challenges and components of a final project.
Classification: Application
AACSB: Application of Knowledge
92) The final report should include an assessment of the effectiveness of the project team, not
only in terms of actual performance on the project, but also with regard to:
A) Imagined performance on the project.
B) Planned performance on the project.
C) Team-building and staffing policies.
D) Their progression through the stages of group development.
Answer: C
Diff: 2
Section: 14.4 Preparing the Final Project Report
LO: 14.4: Know the challenges and components of a final project.
Classification: Concept
AACSB: Application of Knowledge
93) A final report section on the techniques of project management would include an honest
assessment of whether the:
A) Benefits promised to the client were actually delivered.
B) Resource costs could be better estimated.
C) Project workers came together as a team.
D) The project finished on time.
Answer: B
Diff: 1
Section: 14.4 Preparing the Final Project Report
LO: 14.4: Know the challenges and components of a final project.
Classification: Concept
AACSB: Application of Knowledge
94) The primary goal in requiring a project final report is to:
A) Formally close out the project.
B) Provide the customer with a sense of completion.
C) Lay the groundwork for successful future projects.
D) Find out the root cause for all failures, both major and minor.
Answer: C
Diff: 1
Section: 14.4 Preparing the Final Project Report
LO: 14.4: Know the challenges and components of a final project.
Classification: Concept
AACSB: Application of Knowledge
95) The project final report is fundamentally:
A) An historical record.
B) A review of human activity.
C) Window dressing for the project.
D) A forward-looking document.
Answer: D
Diff: 1
Section: 14.4 Preparing the Final Project Report
LO: 14.4: Know the challenges and components of a final project.
Classification: Concept
AACSB: Application of Knowledge
96) Some of the greatest challenges facing project teams during termination is:
A) Maintaining the energy and motivation to finish.
B) Providing accurate data for the project final report.
C) Providing accurate root cause analysis for the project final report.
D) Finding another project to begin.
Answer: A
Diff: 2
Section: 14.4 Preparing the Final Project Report
LO: 14.4: Know the challenges and components of a final project.
Classification: Concept
AACSB: Application of Knowledge
97) A classic statement regarding project termination and closeout is, "The termination of a
project is:
A) The start of the next project."
B) A project."
C) Never ending."
D) An opportunity."
Answer: B
Diff: 2
Section: 14.4 Preparing the Final Project Report
LO: 14.4: Know the challenges and components of a final project.
Classification: Concept
AACSB: Application of Knowledge
98) The difference between a manager with ten years' experience and one with a year's
experience ten times is:
A) Dependent on the manager's tenure with the company.
B) Nine years.
C) Whether lessons-learned were truly learned.
D) Dependent on whether the manager's projects were successful.
Answer: C
Diff: 2
Section: 14.4 Preparing the Final Project Report
LO: 14.4: Know the challenges and components of a final project.
Classification: Concept
AACSB: Application of Knowledge
99) The goal in requiring a final project report is to lay the groundwork for successful future
projects.
Answer: TRUE
Diff: 2
Section: 14.4 Preparing the Final Project Report
LO: 14.4: Know the challenges and components of a final project.
Classification: Concept
AACSB: Application of Knowledge
100) What purpose does a final project report serve? What are the major elements of the final
project report and what information should be contained in each one?
Answer: The final project report is the administrative record of the completed project,
identifying all its functional and technical components as well as other important project history.
The final report is an evaluative document that highlights both the strengths and weaknesses of
its development; a candid assessment of what went right and what went wrong for the project
over its life cycle. The major elements and information in each are as follows:
Project performance — Project achievements relative to plan are assessed. How did the project
compare on time, cost, performance, and client acceptance?
Administrative performance — What standard administrative practices occur within the
organization and what are the benefits and drawbacks to the project?
Organizational structure — Comments on how the organization's operating structure either
helped or hindered the team and its efforts.
Team performance — The report should reflect on the effectiveness of the project team in terms
of their actual performance on the project and with regard to team building and staffing policies,
training or coaching, and performance evaluation.
Techniques of project management — The report should examine the methods of estimation as
well as scheduling processes and techniques.
Benefits to the organization and customer — All projects are guided by a goal or series of
discrete goals that have, as the bottom line, the assumption of providing benefits to the
sponsoring organization and the project's clients. This section of the report should consider the
degree to which the project succeeded in accomplishing its goals and providing the anticipated
benefits.
Diff: 2
Section: 14.4 Preparing the Final Project Report
LO: 14.4: Know the challenges and components of a final project.
Classification: Application
AACSB: Application of Knowledge
101) It has been said that the act of terminating of a project is a project in itself. Explain why you
agree or disagree with this statement.
Answer: This statement suggests that the degree to which a project team makes a systematic and
planned effort to close out a project affects whether the termination will be done efficiently and
with minimal wasted effort or loss of time. In the case of projects that are naturally terminated
through being completed, the steps in termination can be thought out in advance and pursued in
an orderly manner. On the other hand, in circumstances where the project suffers early
termination, the closeout process may be shorter and more ad hoc, that is, it may be done in a
less-than-systematic manner.
Diff: 2
Section: 14.4 Preparing the Final Project Report
LO: 14.4: Know the challenges and components of a final project.
Classification: Critical Thinking
AACSB: Reflective Thinking