© 2006 John Wiley and Sons, Inc. Project Management: A Managerial Approach Chapter 13 – Project Termination

© 2006 John Wiley and Sons, Inc. Overview Methods of Project Termination Early Project Termination Project Shortcomings PM Responsibilities Project Final Report

© 2006 John Wiley and Sons, Inc. Project Termination Conditions 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

© 2006 John Wiley and Sons, Inc. Project Termination Factors 1.Low Probability –Technical Objectives –Commercial Viability –ROI Achieved 2.No Solution –Engineering Design –Lasting Process 3.Intellectual Property Issues

© 2006 John Wiley and Sons, Inc. Project Extinction All (substantive) activity ceases Stopped: –Successful Met goals –Unsuccessful Failed tests –Superceded External event “Extinction by Murder” –Political assassination; “projecticide” –Mergered redundancy

© 2006 John Wiley and Sons, Inc. Project Addition Project becomes a part of organization –New functionality –“Protected” status Transfer of assets –People –Equipment Addition of responsibilities –Budgets –Practices and procedures –“P&L”

© 2006 John Wiley and Sons, Inc. Project Integration Most Common Most Complex Project Outcome(s) Become(s): –Part of Acquiring Organization –Redistribution of Residual Resources Equipment Capital Improvements Follow-on Support

© 2006 John Wiley and Sons, Inc. Project Starvation Budget Decrement Reallocation of Resources Away from Project –Business Conditions –“Political” Considerations Active w/o Activity

© 2006 John Wiley and Sons, Inc. 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?

© 2006 John Wiley and Sons, Inc. When to Terminate a Project Reasons projects fail: –Project organization is not required –Insufficient support from senior management –Wrong person as project manager –Poor planning

© 2006 John Wiley and Sons, Inc. The Termination Process Components of termination process –Whether or not to terminate Goal/Objective-based or Qualification factors –If terminate: Carry out termination procedures Planned Orderly Procedures vary

© 2006 John Wiley and Sons, Inc. Project Termination Decision Tree Sensitivity Analysis Internal Info Systems External Info Systems Decision Database(s) Termination Rules Continue Project Termination Decision? Termination Procedures Uncertain Keep Terminate

© 2006 John Wiley and Sons, Inc. Project Termination Areas

© 2006 John Wiley and Sons, Inc. The Implementation Process Duties of the termination manager: –Complete all remaining work –Notification to & acceptance by client –Complete documentation (accurately!) –Final payments –Redistribute assets –Legal Review –Files & Records –Follow-on support

© 2006 John Wiley and Sons, Inc. The Final Report - A Project History Historical recap Project “biography” –“The Good, the Bad, and the Ugly” Previous documents –Project plan –Audit(s) –Change orders

© 2006 John Wiley and Sons, Inc. The Final Report Focus areas: –Project performance –Administrative performance –Organizational structure –Project and administrative teams –Techniques of project management

© 2006 John Wiley and Sons, Inc. The Final Report Focus area recommendations “Lessons learned” –Benchmarks –Killers Goal: Future project management improvement

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