PRINCE2F Project Initiation and Stages — 10 Questions

Question 1

During the Initiation Stage, the project manager identifies that the selected team lacks experience with the chosen technology. What should the project manager do?

Accepted Answer

Update the Risk Register and plan a response. The lack of experience with the chosen technology is a risk to the project, not an immediate issue. During the Initiation Stage, the project manager should formally record this risk in the Risk Register and plan an appropriate response, such as training or mentoring, to manage the uncertainty. This aligns with PRINCE2's principle of managing by stages and the requirement to identify and respond to risks proactively.

Answer

Replace the team members with experienced ones

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Escalate to the Project Board for decision

Answer

Update the Project Plan to include training

Question 2

A project is initiating and the Business Case shows a cost-benefit ratio of 1:1.2. The project board is concerned. What should the project manager do?

Accepted Answer

Provide justification and request approval. The Business Case shows a cost-benefit ratio of 1:1.2, which is positive (benefits exceed costs). The project board's concern does not automatically invalidate the Business Case. According to PRINCE2, the project manager's role during initiation is to provide the board with the justification (the Business Case) and formally request approval to proceed. Option C is correct because the project manager must present the evidence and seek a decision, not unilaterally change scope or cancel.

Answer

Reduce scope to lower costs

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Seek alternative options to improve benefits

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Recommend project cancellation

Question 3

During Initiation, the project manager discovers that a key assumption in the Business Case is invalid. What should the PM do first?

Accepted Answer

Update the Business Case. The Business Case is the key driver for the project, and if a fundamental assumption is invalid, the project manager must first update the Business Case to reflect the new reality. This ensures that the project remains viable and that the Project Board can make an informed decision about whether to continue. Updating the Business Case is the correct first step because it provides the basis for any subsequent decisions, such as escalating to the Project Board.

Answer

Ignore the assumption

Answer

Stop the project

Answer

Inform the Project Board

Question 4

Which THREE are objectives of the Initiation Stage?

Accepted Answer

Confirm the Business Case. In PRINCE2, the Initiation Stage has three key objectives: confirming the Business Case (option B) to ensure the project remains viable and justified before committing significant resources; establishing project controls (option E) such as tolerances, reporting, and governance structures that will be used throughout the project; and producing the detailed plan for the next stage (option C), which is the first Stage Plan created during initiation. Option A (Close the project) belongs to the Closing a Project process, not Initiation. Option D (Deliver the project product) is the purpose of the project's delivery stages, not the Initiation Stage, which focuses on planning and justification rather than product delivery.

Answer

Close the project

Answer

Deliver the project product

Question 5

Which TWO are true about Stage Plans in PRINCE2?

Accepted Answer

They are approved by the Project Board. Option A is correct because in PRINCE2 a Stage Plan must be approved by the Project Board (or by the Project Manager under delegated authority from the Board) before the stage can begin, since the Board authorises each stage's work through the Stage Plan. Option C is correct because Stage Plans are produced during the 'Managing a Stage Boundary' process, i.e., at the start of each stage (except the first, whose Stage Plan is created in 'Initiating a Project'), to define the products, activities, resources, tolerances, and controls for that stage. Option B is wrong because covering the entire project timeline is the role of the Project Plan, not the Stage Plan, which addresses only one management stage. Option D is wrong because the Stage Plan supplements and is derived from the Project Plan; it never replaces it. Option E is wrong because a Stage Plan is more detailed than the Project Plan, providing the day-to-day level of detail needed to manage and control the stage.

Answer

They cover the entire project timeline

Answer

They replace the Project Plan

Answer

They are less detailed than the Project Plan

Question 6

Which THREE are inputs to the Initiation Stage?

Accepted Answer

Project Brief. In PRINCE2, the Initiation Stage is triggered by the Project Mandate (B), which is the trigger that formally starts the project and provides the initial idea or need, and it is used to create the Project Brief (A), which captures the initial requirements, scope, and justification that the Initiating a Project process will refine. Lessons from previous projects (C) are also a required input, as the project board and project manager must consider prior experience (captured in the Lessons Log) to inform the Project Initiation Documentation. The Project Initiation Documentation (D) is not an input but the key output produced during the Initiation Stage, and the End Project Report (E) is produced at the end of the project (Closing a Project process), so neither belongs as an input to Initiation.

Answer

Project Initiation Documentation

Answer

End Project Report

Question 7

You are the project manager for a software implementation project in a large retail company. The project is currently in the Initiation Stage. The senior user has provided the requirements, and the senior supplier has estimated that the project will cost £1.2 million and take 18 months. However, during a review of the Business Case, you discover that the expected benefits are only £1.3 million, giving a benefit-cost ratio of just 1.08:1. Additionally, the market conditions are volatile, and there is a risk that a competitor may launch a similar product before your project completes, potentially reducing benefits by 30%. The project board is eager to proceed but wants assurance that the project is viable. What should you do?

Accepted Answer

Update the Business Case with risk-adjusted benefits and present to the board. The PRINCE2 principle of continued business justification requires that the Business Case be updated to reflect current risks and uncertainties. In this scenario, the market volatility and competitor risk could reduce benefits by 30%, dropping the expected benefits to £910,000, which is below the £1.2 million cost, making the project unviable. Presenting this risk-adjusted Business Case to the board allows them to make an informed decision on whether to proceed, rather than proceeding with an overly optimistic view.

Answer

Proceed with the current Business Case as the board is eager

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Escalate to the programme manager without updating the Business Case

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Recommend cancelling the project due to poor viability

Question 8

During the Initiating a Project process, the project manager identifies that the business case relies on a key supplier delivering critical components by a fixed date. However, the supplier has a history of delays. What should the project manager do?

Accepted Answer

Record the risk in the risk register and plan a response in the risk management approach. In PRINCE2, the risk register is the central repository for recording all identified risks, and the risk management approach defines how risks will be managed throughout the project. During the Initiating a Project process, the project manager must formally document the supplier delay risk and plan appropriate responses (e.g., mitigation, contingency) within the risk management approach. This ensures the risk is actively managed rather than ignored or deferred, aligning with PRINCE2's principle of continued business justification.

Answer

Proceed with the plan as the supplier has always delivered eventually

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Adjust the business case to remove the supplier dependency

Answer

Ask the project board to approve the project with a note about the risk

Question 9

Drag and drop the steps of the PRINCE2 Controlling a Stage process into the correct order.

Accepted Answer

Authorize Work Packages, then Review Work Package Status, then Receive Completed Work Packages, then Review Stage Status, then Report Highlights, then Capture and Examine Issues and Risks, then Take Corrective Action, then Escalate Issues and Risks (if needed). Controlling a Stage includes authorizing work, reviewing progress, assessing stage status, reporting to the Project Board, and taking corrective action as needed.

Answer

Report Highlights, then Authorize Work Packages, then Review Work Package Status, then Receive Completed Work Packages, then Review Stage Status, then Capture and Examine Issues and Risks, then Take Corrective Action, then Escalate Issues and Risks (if needed)

Answer

Take Corrective Action, then Authorize Work Packages, then Review Work Package Status, then Receive Completed Work Packages, then Review Stage Status, then Report Highlights, then Capture and Examine Issues and Risks, then Escalate Issues and Risks (if needed)

Answer

Escalate Issues and Risks (if needed), then Authorize Work Packages, then Review Work Package Status, then Receive Completed Work Packages, then Review Stage Status, then Report Highlights, then Capture and Examine Issues and Risks, then Take Corrective Action

Question 10

Match each PRINCE2 process to its purpose.

Accepted Answer

Starting Up a Project: To ensure that the prerequisites for initiating a project are in place.. The correct matches are: Starting Up a Project ensures prerequisites are in place; Initiating a Project establishes the project's foundation. Common confusion: mixing up these two processes.

Answer

Starting Up a Project: To establish a solid foundation for the project, enabling the project board to decide on committing to the project.

Answer

Initiating a Project: To ensure that the prerequisites for initiating a project are in place.