Reason to stop project

Reasons to stop projects before completion

Stop in-flight projects signOne of the hardest decisions for any organisation to make is when to stop a project.  This is not where the objectives have been met and project complete, it is where the project is mid-flight and has not met the objectives.  This decision is hard for a number of reasons:

Financial

There will typically be an investment of time, resource and money.  In stopping the project before completion, it is difficult for many to reconcile the wasted investment.  It is easy to think that by continuing and completing, the money will not be wasted.  This is particularly difficult where a project is 50%, 75% or even more complete.  Emotion makes the argument that we have invested so much so we should finish.  However, if the project will no longer deliver value and / or is not aligned to the direction of the organisation, any additional investment is a complete waste.

Failure

Some managers will resist stopping a project as it is seen as failure.  It is only natural that a project manager does not want to feel they have not been successful.  The project will have been based on a business case that, for whatever reason, is no longer valid.  Therefore, taking the decision to stop can be seen as having failed.  Again easy to think by pushing ahead can turn it into success.

However, the truth is that by not making strong, rapid, decisive decisions, can actually lead to increased financial loss and bigger failures.

Reasons for stopping projects

There are a number of drivers that may cause projects to be stopped before completion.

Alignment to Strategy

While this should be obvious and every project should align to strategy, this is not always the case.  For instance, a multi-year project may have started being aligned to strategy.  Then an organisation takes decisions to change course due to external factors and the project is no longer aligned.

A variation of this is where a senior manager has a “pet project” (one they have wanted to complete regardless of how it fits with strategy).  It is surprising how many senior managers cannot see past their own need for the project.

Business Case

All projects should have a business case.  This is the proposal that supports the investment in a particular project.  If the dynamics of the business case change (costs trend much higher than estimates, proposed revenue will be lower, benefits reduced, etc), the business case should be reviewed and reworked using the new data.  If the business case no longer provides the required return on investment, the project should be stopped.

Priorities

Priorities in an organisation may change.  This does not have to be a change in strategy, it may be that other projects become more important.  This may require the re-allocation of resources and budget.

To close

Just because a business case for a project has been approved, it does not mean that it should be left to complete.  It is healthy to review and challenge all projects on a periodic basis (at least annually) to ensure that they are still aligned to strategy and the business case dynamics are valid.  Doing this will ensure that an organisation makes the most effective use of scarce resources.