Project Termination

1. Project Termination • Types of terminations • How and why projects terminate • Typical termination activities • Need for a project history

2. All Things Come to an End . . . • Termination rarely has much impact on technical success or failure . . . • But a huge impact on other areas • Residual attitudes toward the project (client, senior management, and project team) • Success of subsequent projects • So it makes sense to plan and execute termination with care

3. When Do Projects Terminate? • Upon successful completion, or . . . • When the organization is no longer willing to invest the time and cost required to complete the project, given its current status and expected outcome.

4. Most Common Reasons Projects Terminate • 1. Low probability of technical/commercial success • 2. Low profitability/ROI/market potential • 3. Damaging cost growth • 4. Change in competitive factors/market needs • 5. Unresolvable technical problems • 6. Higher priority of competing projects • 7. Schedule delays Source: Dean, 1968

5. Decision Structure for a Termination Decision, Figure 13-1

6. Four Varieties of Project Termination • 1. “Termination by extinction” • Project has successfully completed, or it has failed • Natural passing, or “termination by murder” • Either way, project substance ceases, but much work needs to be done • Administrative • Organizational

7. Four Varieties of Termination (cont’d) • 2. “Termination by addition” • The project becomes a formal part of the parent organization • People, material, facilities transition • The example of Nucor • 3. “Termination by integration” • Project assets are distributed to and absorbed by the parent

8. Four Varieties of Termination (cont’d) • 4. “Termination by starvation” • Withdrawal of “life support” • Can save “face,” avoid embarrassment, evade admission of defeat

9. Typical Termination Activities • In general, there are seven categories of termination tasks. Examples of activities: • 1. Personnel • Dealing with “trauma of termination” • Finding “homes” for the team • Who will “close the doors?” • 2. Operations/Logistics/Manufacturing • Rethinking systems • Provisions for training, maintenance, spares

10. Termination Activities (cont’d) • 3. Accounting and Finance • Accounts closed and audited • Resources transferred • 4. Engineering • Drawings complete/on file • Change procedures clarified

11. Termination Activities (cont’d) • 5. Information Systems • Configuration and documentation in place • Systems integrated • 6. Marketing • Sales and promotion efforts in line • 7. Administrative • All organizations aware of change

12. A Design for Project Termination, Figure 13-2

13. Project History • One of the major aims of termination is development and transmittal of “lessons learned” to future projects • One way to do that is through a project history

14. Contents of a Project History • 1. Project Performance • What was achieved; successes, challenges, failures • 2. Administrative Performance • Reports, meetings, project review procedures; HR, financial processes • 3. Organization Structure • How structure evolved, how it aided/impeded progress

15. Contents of a Project History (cont’d) • 4. Project and Administrative Teams • Performance of the project team, recommendations • 5. Project Management Techniques • Planning, budgeting, scheduling, risk management, etc.: what worked, what didn’t

16. Challenges to Meaningful Project Histories • Since the project history has so much potential benefit, why is it often done poorly, or not at all? • Possible reasons • No one sees it as their job • PM has many other priorities, especially as project winds down • Long duration projects mean many PMs, voluminous record, little corporate memory • PMs may be more attuned to looking forward than looking back