PRINCE2 7 Foundation · Study lesson 34
Prepare the next investment decision
Bring evidence, forecasts and a realistic next-stage proposal to the board.
11 minute study lesson · Processes · Original learning material
What you will understand
- Explain the information prepared at a management stage boundary.
- Distinguish normal next-stage planning from requested exception planning.
- Separate preparing a recommendation from authorising continued work.
The idea
A stage boundary should create a useful pause in commitment, not simply a celebration of work already done. Managing a stage boundary equips the board to judge the current position and decide what should happen next. The project manager prepares evidence and proposals; the board makes the authorisation decision through Directing a project.
Review the current stage against its authorised plan, including the products delivered, quality results, costs, time and other relevant performance targets. Explain significant departures and outstanding matters honestly. An end stage report turns that evidence into a usable account of performance. A positive report is not an instruction to continue; it is information the board can use alongside the updated outlook and the next-stage proposal.
Prepare the next stage plan at the level of detail now possible. Incorporate lessons, resource realities, dependencies and current risks. Update the project plan so that the overall forecast reflects what has actually been learned. The boundary occurs as the current stage approaches its end; preparation should be timely enough for a decision without treating later-stage work as already authorised. Early preparation does not bypass the decision gate.
Review and update the business case. Costs already incurred are relevant to an honest account, but continuing depends on the remaining investment and expected value, not on a desire to justify sunk expenditure. Reassess benefits, dis-benefits, risks and the ability to deliver and adopt the products. A technically successful stage can still be followed by a recommendation to stop if the wider case has deteriorated.
Review management arrangements, responsibilities and information that may need adjustment for the next stage. The next stage may involve different suppliers, users, quality activities or reporting needs. Record lessons and apply relevant ones now rather than storing them for closure. Submit the stage evidence, updated case and plans with the request for authorisation. The board can approve, ask for changes, defer or decide that continuation is no longer justified.
This process also supports preparation of an exception plan when requested by the appropriate authority after an exception report. Such replanning need not wait for a scheduled boundary and can be required during the final stage. The replacement covers the affected plan at the appropriate level and requires approval. At the normal end of the final stage, Closing a project supplies the planned closure route rather than inventing another delivery stage.
A boundary supports the next commitment
| Prepare | So the board can… |
|---|---|
| End stage performance information | Compare the completed stage with its plan. |
| Updated project plan and business case | Consider the current overall forecast and value. |
| Next stage plan | Evaluate a specific proposed commitment. |
| Lessons and updated risks | Use experience and current uncertainty in the decision. |
| An exception plan when requested | Consider replacement arrangements rather than silently changing authority. |
An original fictional example
Fictional case: a community cold store
A pilot stage has demonstrated that a cold store can reduce food waste. However, electricity prices have risen and the organisation’s expected operating savings are lower. The next stage would equip three more sites.
The decision
The project manager reports the pilot’s results, updates the costs and benefits, revises the project forecast and prepares the next stage proposal. The board assesses whether expansion is still worthwhile before authorising equipment orders.
Why it makes sense
Passing product tests does not settle the investment decision. A boundary connects delivery evidence with a refreshed business case and an explicit commitment to the next stage.
A common confusion
The mistaken idea: Finishing the current stage automatically authorises the next stage plan.
The distinction: The manager prepares the evidence and request; the board separately decides whether the next stage may proceed.
Preparation creates an option for the board, not permission for the manager.
Points to remember
- Boundary preparation combines end-stage evidence, the next stage plan and updated project information.
- The business case is reassessed before further commitment.
- Requested exception planning can occur between scheduled boundaries.
Your takeaway
Use a stage boundary to make the next investment decision better informed. Update the case and forecasts, apply lessons, prepare realistic plans and obtain authority before continuing.
This independently written explanation is supplementary study material. It is not official examination content. Read about our content and its limitations.