Project Termination can be Smart Management

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Jose Daniel Esterkin
CEO, Argentina

Project Termination can be Smart Management

🔥NEW There are four fundamentally different ways to terminate a project (Meredith and Mantel 2000, 540–545):
  • TERMINATION BY EXTINCTION. The project may be stopped because it has been either successful, or unsuccessful. Examples of successful projects include the launch of a software program; the inauguration of an automobile production line; and, the completion of a new school building. Unsuccessful projects may include a drug manufacture that has failed efficacy tests; a project that is no longer cost-effective; and, a disposal site that has failed to meet environmental standards.
  • TERMINATION BY ADDITION. This is where a project is made more or less an external, but full-fledged addition to the parent organization. For example, a new department of a university would be built as an extension of existing university facilities, to operate with substantial independence from other segments of the institution.
  • TERMINATION BY INTEGRATION.This is the most common way of dealing with successful projects, and the most complex. The output of the project becomes part-and-parcel of the operating systems of the parent or client, becoming embedded in day-to-day operations. This requires thorough integration with primary operations at various levels, distributing the output among existing functions.
  • TERMINATION BY STARVATION. As the term suggests, the financial, human, and material resources needed to execute the project are curtailed or withheld. The project is effectively dead, and merely on minimal life-support system for legal reasons. Termination by murder, or "projecticide" is an interesting variation, where the incomplete project is terminated without warning.
In many people's minds—and in many of the organizations I am familiar with—early project termination has somehow become linked with failure.
This couldn't be any further from the truth. Early project termination (obviously for the right business reasons) is actually smart management! Because it is proof of a process of reallocating funds from a relatively poor investment to a relatively good one. You should look at your project as an investment: how many dollars will we get for each dollar invested? The question posed by project sponsors: "How is the project doing?", should be translated to: "Is the investment yielding enough benefits?".

And if it's not, then actively lead the project team through the confusing period of time to make the investment work. The key term here is "actively". Make your visibility greater at this time than at anytime since the beginning of the project. Your project team may begin to disintegrate. Communication will become more difficult for you. You may not be able to count on a captive audience each week at your team meetings. Organizing people and things will become increasingly difficult. All of these issues require that you maintain a high profile and assume a position of strong leadership.

And if your project continues to not give back enough returns, or if you are pretty sure it will never do, stop the investment. It is the same rationale than as you are holding certain company stock and the stock keeps going down forever. You should then sell your stock ASAP and accept it as a loss.

Sources:
Meredith, Jack R., and Samuel J. Mantel. (2000). Project Management: A Managerial Approach. New York: John Wiley & Sons.
Harvey A. Levine, Practical Project Management (2002),

  Trilok Sindhwani
Consultant, India
 

Project Termination

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