The Importance of Having Clearly Defined Acceptance Criteria in Your Projects

The Importance of Clearly Defining the Acceptance Criteria for Projects


Last updated August 28, 2017


"Congratulations, Rajesh! I think you guys have made it. I have signed off on all your deliverables in this project. I will send out a confirmation email to you, Sabyasachi, and all other primary stakeholders in this project, soon", Mandy said to Rajesh. Rajesh just couldn't conceal his excitement when he heard this. Rajesh was our onsite engagement manager, and Mandy was one of our business users. My team and I were working on a Sharepoint based project for the tax team of one of our clients. The last few months have been a roller coaster ride for the entire team, and there were multiple occasions when the project was delayed due to a lot of issues including a few unforeseen risks or challenges. Some of these issues were conflicts with the change management board, conflicts with the server support team, operational issues with the networking and hardware support team, besides others.

However, despite these challenges, we were able to successfully deliver the project within the planned schedule and budget, by implementing some of the best practices in project management and software development. Besides other best practices, they included the preparation of a well-defined requirements document and a clearly defined set of acceptance criteria which was approved by Mandy. During the final approval of the solution, as Mandy struck off one deliverable after another on her checklist, we were happy we had put in a great deal of effort into preparing a defined set of acceptance criteria before commencing our project.
In this article, we will take a look at what acceptance criteria are all about, and the importance of devising a clearly defined set of acceptance criteria for projects.

What are Acceptance Criteria?


Acceptance criteria are those criteria, including performance requirements and essential conditions, which must be met before project deliverables are accepted (PMBOK® GuideV4). They set out the specific circumstances under which the user will accept the final output of the project. They are criteria against which we can measure, achieve, and prove to our clients that our work is complete. Examples of some of the conditions or criteria of acceptance could be - 

  1. Backup and Restore testing has been completed successfully.
  2. User acceptance testing (UAT) has been completed, and the Senior User/Project Executive has signed off on user acceptance testing.
  3. All requirements have been formally approved.
  4. Business Continuity Plan (BCP) is in place to be used in situations where the IT system is unavailable, for whatever reason.

How Do You Document Acceptance Criteria?

According to the PMBOK® Guide, 4th edition, the acceptance criteria are documented in the requirements document and the project scope statement. Acceptance criteria are often also considered an important part of contractual agreements on external projects.

What Value Does a Clearly Defined Set of Acceptance Criteria Bring to Your Projects?

1. Set the client's expectation level

The success or failure of your projects depends on your ability and that of your team to meet the clients' documented or perceived acceptance criteria. By having a clearly defined set of acceptance criteria, you will be able to set the client’s expectation level and lay the groundwork for their perception of the completed product. Inaccurate or missing acceptance criteria can lead to low customer satisfaction levels, missed delivery dates, and development cost overruns.

For instance, on this project, one of the acceptance criteria that we worked on was whether performance testing was conducted to evaluate the Sharepoint application to the agreed performance criteria that is to check whether the expected response time was met or not. The response times of the Sharepoint application had drastically reduced in the last few years despite a marginal increase in the number of users across the globe. Business users also complained of different response times in different parts of the globe, where the client had set up its business operations. Therefore, it was very important for us to include this as an acceptance criteria and set the expectation level of the client regarding the application response times and provide them with a range of values in seconds, such as 1-2 seconds to refresh the page and so on.
2. Make the difference between getting paid or not on projects where the client is paying for deliverables

Acceptance criteria are typically used on projects where the client is paying for deliverables or the completion of the project's phases. You should ensure that the acceptance criteria developed are relevant to the deliverables, binary (either acceptable or not acceptable), measurable or tangible (whenever possible) and tied to payments (whenever appropriate). Clients are known to refuse the sign offs on the deliverables for two legitimate reasons; either the project results have not met their needs, or they themselves were not clear about their needs. By working towards a clearly defined set of acceptance criteria before you start working on your deliverables, you will be protecting yourself, your project team, and your company.
Since the project sponsor is the person responsible for approving the final product, he is also responsible for approving the acceptance criteria. All things being equal, if the acceptance criteria are met, there should be no reason why the sponsor should not approve and accept the final product. While working with Mandy and other business users, we faced some challenges in gathering requirements and preparing the final acceptance criteria. But our efforts in preparing thorough requirement documentation and a well-defined set of acceptance criteria in the requirement gathering phase paid off at the end.
3. Avoid miscommunication on internal projects
If the client is internal, you will be able to avoid political maneuvering and miscommunication by developing a clearly defined set of acceptance criteria. A few years ago, I had the opportunity to manage an application development project for the testing horizontal within our organization. The web application was built to help the clients and senior management, with a lot of relevant information regarding the business of this particular horizontal. One of the biggest challenges in these projects was managing communications with the team which was geographically dispersed and based out of development centers in different cities.
This being an internal project, most of the stakeholders on this project including me were volunteering for this project, in addition to our regular responsibilities. Stakeholders found it difficult to contribute to the project in parallel with their daily jobs. Therefore, it was difficult to bring about common, clear, and shared understanding among the stakeholders on several issues in the project, including requirement gathering. This was one of the reasons why it took us almost a month to gather a clear set of requirements and acceptance criteria and get it approved from the VP of the horizontal, who was also the project sponsor. Another issue was that all the primary stakeholders including business analysts, testing experts, and testing managers, had different perceptions of the end product.
The application was being developed for the testing horizontal, and I had to set up a lot of knowledge transfer sessions for my teams, with the business analysts and the testing experts. It was quite difficult for me to gain a consensus on the requirements amongst these stakeholders. But as a team, we persisted in our efforts to gather a clear set of requirements and the acceptance criteria, and get them approved. This helped us a lot in reducing the time required for coding and development, and avoid other conflicts which would have eventually ensued had this not been done.


Acceptance criteria represent a specific and defined list of conditions that need to be met before a project has been considered completed and the project deliverables are accepted by the client. Having clearly defined acceptance criteria can help you in many ways, including setting the expectations of the client regarding the end product; measure, achieve and prove to your clients that the work is complete; gain formal sign offs from the client on the deliverables in the project; and protect yourself and your company from issues such as non-payments from clients. They can also help you avoid miscommunication and political maneuverings on internal projects. They are included as a part of the contractual agreement with clients, as well as in the project scope statement and requirement documents.
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About the Author

Sabyasachi has over a decade’s experience in leading IT and non-IT projects in the Healthcare, Oil, and Energy, eCommerce, Public Sector Undertaking, and Services industry. He is a PMI certified project management professional and a volunteer in the project management community with a focus on best practices and mentoring other project management professionals. His writings are regularly published in several blogs, forums, and online project management communities.


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