Project Management A Managerial Approach

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it has been successful and achieved its goals • The project may also be stopped because it is unsuccessful or has been superseded • A special case of termination by extinction is “termination by murder” which can range from political assassination to accidental projecticide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 Integration • A 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 Project • Fundamental 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 Process • Decision-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 it • Just 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 Process • Duties 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 Process • Duties 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

Project Termination Figure 13-2

Project Termination Table Files

Project Termination

Project Management A Managerial Approach