Project ManagementA Managerial Approach

Chapter 13

Project Termination

The Varieties of Project Termination

A project can be said to be terminated when work on the substance of the project has ceased or slowed to the point that further progress is no longer possible

There are four fundamentally different ways to close out a project: extinction, addition, integration, and starvation

Termination by Extinction

The project may end because it has been successful and achieved its goals

The project may also be stopped because it is unsuccessful or has been superseded

A special case of termination by extinction is “termination by murder” which can range from political assassination to accidental projecticide

Termination by Extinction

Two important characteristics of termination by murder are the suddenness of project demise and the lack of obvious signals that death is imminent

When a decision is made to terminate a project by extinction, the most noticeable event is that all activity on the substance of the project ceases

Termination by Addition

If a project is a major success, it may be terminated by institutionalizing it as a formal part of the parent organization

Project personnel, property, and equipment are often simply transferred from the dying project to the newly born division

The transition from project to division demands a superior level of political sensitivity for successful accomplishment

Termination by Integration

This method of terminating projects is the most common way of dealing with successful projects, and the most complex

The property, equipment, material, personnel, and functions of the project are distributed among the existing elements of the parent organization

Termination by Integration

In general, the problems of integration are inversely related to the level of experience that the parent or client has had with: the technology being integrated

the successful integration of other projects, regardless of technology

Termination by IntegrationA few of the more important aspects of the

transition from project to integrated operation that must be considered: Personnel - where will the team go? Manufacturing - is the training complete? Accounting/Finance - have the project’s account been

closed and audited? Engineering - are all drawings complete and on file? Information Systems/Software - has the new system

been thoroughly tested? Marketing - is the sales department aware of the

change?

Termination by Starvation

This type of project termination is a “slow starvation by budget decrement”

There are many reasons why senior management does not wish to terminate an unsuccessful or obsolete project: Politically dangerous to admit that one has

championed a failure Terminating a project that has not accomplished

its goals is an admission of failure

When to Terminate a Project

Some questions to ask when considering termination: Has the project been obviated by technical

advances? Is the output of the project still cost-effective? Is it time to integrate or add the project as a

part of regular operations? Are there better alternative uses for the

funds, time and personnel devoted to the project?

Has a change in the environment altered the need for the project’s output?

When to Terminate a ProjectFundamental reasons why some projects

fail to produce satisfactory answers to termination questions: A project organization is not required Insufficient support from senior management Naming the wrong person as project manager Poor planning

These and a few other reasons, are the base cause of most project failures

The specific causes derive from these fundamental issues

The Termination Process

The termination process has two distinct parts

First is the decision whether or not to terminate

Second, if the decision is to terminate the project, the decision must be carried out

The Decision ProcessDecision-aiding models for the termination

decision fall into two generic categories: 1. Models that base the decision on the

degree to which the project qualifies against a set of factors

generally held to be associated with successful projects

2. Models that base the decision on the degree to which the project meets the

goals and objectives set for itJust as the decision criteria, constraints,

weights, and environmental data are unique to each organization, so are the specifics of using any decision model

The Implementation Process

The actual termination can be planned and orderly, or a simple hatchet job

Special termination managers are sometimes useful in completing the long and involved process of shutting down a project

The primary duties of the manager in charge of termination can be encompassed in nine general tasks

The Implementation ProcessDuties of the termination manager:

Ensure completion of the work, including tasks performed by subcontractors

Notify the client of project completion and ensure that delivery is accomplished

Ensure that documentation is complete including a terminal evaluation of the project deliverables and preparation of the project’s Final Report

Clear for final billings and oversee preparation of the final invoices sent to the client

The Implementation ProcessDuties of the termination manager

(cont.): Redistribute personnel, materials equipment,

and any other resources to the appropriate places

Clear project with legal counsel or consultant Determine what records to keep Ascertain any product support requirements,

decide how each support will be delivered, and assign responsibility

Oversee the closing of the project’s books

The Implementation Process

Most project managers delay the personnel reassignment/release issue as long as possible for three main reasons: 1. A strong reluctance to face the interpersonal

conflicts that might arise when new assignments and layoffs are announced

2. Worry that people will lose interest and stop work on the project as soon as it

becomes known that termination is being considered

3. Concern that team members will try to avoid death by stretching out the work as

far as possible

The Final Report - A Project History

The final report is the history of the project

It is a chronicle of the life and times of the project, a compendium of what went right and what went wrong

The required information is contained in the master plan, all project audits, and evaluations

The precise organization of the report is not of great concern; the content is

The Final Report

Several Subjects should be addressed in the final report: Project performance

Administrative performance

Organizational structure

Project and administrative teams

Techniques of project management

The Final Report

For each element covered in the final report, recommendations for changing current practice should be made and defended

Equally important are comments and recommendations about those aspects of the project that worked unusually well

The fundamental purpose of the final report is to improve future projects

Summary

A project can be terminated in one of four ways: by extinction, addition, integration, or starvation

Making a decision to terminate a project before its completion is difficult, but a number of factors can be of help in reaching a decision

Studies have shown that the factors associated with project success are different for different industries and the various types of projects

Summary

Most projects fail for one or more of the following reasons: Inappropriate use of the project form of

organization

Insufficient top management support

Naming the wrong project manager

Poor planning

Summary

Success-related factors, or any factors management wishes, can be used in termination decision models

Special termination managers are often used, and needed, for closing out projects

This task, consisting of eight major duties, is a project in itself

Summary

The project Final Report incorporates the process knowledge gained from the project

In addition to preservation of project records, the Final Report embodies the experience from which we learn

The Final Report should include: project performance comments, administrative performance comments, organizational structure comments, personnel suggestions

Project Termination

Questions?

Project Termination

Picture Files

Project Termination

Figure 13-1

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Figure 13-2

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Table Files

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Project Termination