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– Superceded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

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 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
Internal Info
Systems External Info
Decision
Systems
Database(s)

Termination
Rules

Uncertain Sensitivity
Continue Termination
Analysis
Project Keep Decision? Terminate
Termination
Procedures
© 2006 John Wiley and Sons, Inc.
 Project Termination Areas

P r o je c t C lo s e o u t

O r g a n iz a t io n F in a n c ia l P u r c h a s in g S ite

C lo s e o u t M t g P a y a b le s C o n tra c ts C lo s e F a c ilitie s
P la n s R e c e iv a b le s S u p p lie r C o m m D is p o s e E q u ip / M a t'l
P e rs o n n e l B u d g e t R e p o rt F in a l P a y m e n ts
© 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

© 2006 John Wiley and Sons, Inc.

Copyright 2006 John Wiley & Sons, Inc.
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© 2006 John Wiley and Sons, Inc.