Project Management Session 8

Project Termination

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Preamble

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The Ways of Terminating a Project

• 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 different waysways to close out a project: extinction, addition, integration, and starvation

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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• The project may also be stopped because it is unsuccessful or has been superseded;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.

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Termination by Extinction

• Two important characteristics of termination by murder are the suddennesssuddenness 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 substancesubstance of the project ceases.

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Termination by Addition

• If a project is a major success, it may be terminated by institutionalizing it as a formal part of the parent institutionalizing it as a formal part of the parent organization;organization;

• Project personnel, property, and equipment are often Project personnel, property, and equipment are often simply transferredsimply 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.

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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.

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Termination by Integration

• In general, the problems of integration are inversely related to the level of experience that level of experience that the parent or client has had withthe parent or client has had with:

– the technology being integrated;

– the successful integration of other projects, regardless of technology.

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Termination by IntegrationTermination by Integration

• A few of the more important aspects of the transition from project to integrated operation that must be considered:– Personnel Personnel - where will the team go?;– Manufacturing Manufacturing - is the training complete?;– Accounting/FinanceAccounting/Finance - have the project’s account been

closed and audited?;– Engineering Engineering - are all drawings complete and on file?;– Information Systems/SoftwareInformation Systems/Software - has the new system

been thoroughly tested?;– Marketing Marketing - is the sales department aware of the

change?

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Termination by StarvationTermination by Starvation

• This type of project termination is a “slow starvation by budget decrementbudget 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.

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When to Terminate a ProjectWhen to Terminate a Project

• Some questions to ask when considering termination:– Has the project been obviated by technical technical

advancesadvances?– Is the output of the project still cost-effectivecost-effective?– Is it time to integrate or addintegrate or add the project as a

part of regular operations?– Are there better alternativebetter alternative uses for the funds,

time and personnel devoted to the project?– Has a change in the environmentchange in the environment altered the

need for the project’s output?

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When to Terminate a ProjectWhen 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.

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The Termination ProcessThe 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.

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The Decision ProcessThe 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;associated with successful projects;

2. Models that base the decision on the degree to which the project meets the goals and objectives set for itproject 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.

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The Implementation Process

• The actual termination can be planned and orderly, or a simple hatchet job;

• Special termination managersSpecial 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.

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The Implementation ProcessThe Implementation Process

• Duties of the termination manager:– Ensure completion of the work,completion of the work, including

tasks performed by subcontractors;– Notify the client of project completion and

ensure that deliverydelivery is accomplished;– Ensure that documentation documentation is complete

including a terminal evaluation of the project deliverables and preparation of the project’s Final Report;Final Report;

– Clear for final billingsfinal billings and oversee preparation of the final invoices sent to the client.

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The Implementation ProcessThe Implementation Process

• Duties of the termination manager (cont.):– Redistribute Redistribute personnel, materials equipment,

and any other resources to the appropriate places;

– Clear project with legallegal counsel or consultant;– Determine what recordsrecords to keep;– Ascertain any product supportproduct support requirements,

decide how each support will be delivered, and assign responsibility;

– Oversee the closing of the project’s booksproject’s books.

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The Final ReportThe Final Report

• The final report is the historyhistory of the project;• It is a chroniclechronicle 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.

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The Final ReportThe 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.

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A life worth living is a life worth recordingA life worth living is a life worth recording

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