Project termination

Project Termination Meaning, Reasons, Types

Table of Contents:-

  • what is project termination?
  • What will happen if a project is not closed properly?
  • Types of Project Termination
  • Project termination process
  • Reasons for Project Termination

What is Project Termination?

The final stage of the project management lifecycle is project termination. At the end of a project, the team reviews the deliverables, compares and tests their quality against the project’s objectives, and then shares the deliverables with the project’s client.

All projects have fixed start dates and completion dates. Project termination is a process that occurs whether the project is successful or not. Termination rarely has much impact on technical success or failure but has a significant impact on other areas, including:

1) Residual attitudes toward the project (client, senior  management, and project team),
2) Success of subsequent projects.

Therefore, it makes sense to plan and execute termination with care. Closing a project is also a major activity in the project life cycle. Every project has to come to an end after it has achieved its objectives. Closing holds special significance in project management because it marks the formal acceptance of the project by the client and the archiving of the project reports for future reference.

The word “termination” means to close, end, or conclude. Technically, project termination can occur at a stage where it is halted, slowed, or at a point where no progress can be made.

Project Termination: Strategies, Pitfalls, and the Impact on Success

Termination can occur in various ways; the best way involves a planned, systematic procedure, while the worst involves the abrupt cancellation of work, slow attrition of effort, or the diversion of resources to higher-priority projects. When a project goes awry, it is either terminated before goals are reached or allowed to limp along until fizzling out before completion.

Unless formally terminated, projects tend to drag on—sometimes unintentionally due to neglect or insufficient resources, and sometimes intentionally due to a lack of follow-up work. Workers may stay on the project payroll for months after their obligations have been met, turning an otherwise successful project into a financial failure. As long as the project has not been officially terminated, work orders remain open, and labour charges continue to accrue.

Understanding Project Termination: When, Why, and How Projects Conclude

A project is terminated when the work on the project has reached a point where no further progress is possible. Such a situation is likely when the project is significantly behind schedule or when its resources are transferred to other projects.

A project concludes either after achieving its objectives or when it is terminated for other reasons. Closing a project not only signifies the completion of all administrative activities but also involves an audit of the project’s performance, serving as a valuable learning tool for the project manager and others.

Projects, by definition, are activities of limited duration; all projects come to an end. When this occurs, it is the project manager’s responsibility to ensure that all project-related work has been completed and formally closed out by a specified date. Ending a project is the project manager’s duty, which can be challenging, especially when there is no follow-up project.

What will happen if a project is not closed properly?

When a project is not properly closed, the opportunity to learn from its processes and outcomes is lost. The likelihood of encountering the same challenges and, perhaps, having less motivated teams increases the next time we begin a project. Failing to properly end a project means that no lessons are learned, and team efforts are not recognized and honoured. Whether the project is intended for an internal audience or an external organization, our customers may likely be less pleased with the results. This is true regardless of how well it meets project criteria or how quickly our client receives our deliverables.

Types of Project Termination

A project manager may terminate a project for various reasons, including completing it on time or finishing it ahead of schedule. Projects can also be cancelled, continue indefinitely, or fail. There are generally four types of project termination:

1. Normal Closure

When a project is completed according to plan, that is the usual condition of project closure. At this point, the client accepts the project, the project’s goals are met, and the regular process of project closure starts.

2. Premature Closure

Numerous projects either aren’t given a chance or don’t manage to complete all of their deliverables. Instead, they are closed before finishing by removing project components that were initially identified in the project scope. This may occur due to budget constraints, such as when the client allocates less money to the project or when the budget has already been exhausted. Premature closure can also happen when a project is important from a strategic standpoint and needs to be completed sooner than anticipated, such as in the case of a new product launch. The client may miss an opportunity if the product is delayed past the initial completion date.

3. Perpetual Projects

Other projects, on the other hand, seem to go on forever. These are initiatives that have experienced numerous snags, hiccups, and issues. Perpetual projects face challenges such as infinite scope creep, add-ons, and constant changes. Due to these ongoing issues, these projects struggle to accomplish their goals or objectives. This situation can be extremely frustrating for the project manager and the team. The client also experiences frustration as they don’t see the project’s goals being met despite repeated requests for changes. At some point, the project manager needs to address the scope, create a plan for completion, and put an end to the perpetual nature of the project.

4. Failed Projects

Far too often, projects fail. Project failure can have many different reasons. The project may be permanently terminated if the client runs out of money, which happens frequently.

Project Termination Process

The project closing process consists of technical, learning, and human components. In the technical phase, tie up any loose ends, assess what worked and what didn’t, and identify areas for improvement. In the learning phase, express gratitude to the team. Follow these procedures as a project nears completion to ensure a stronger future.

1. Technical Phase

While the technical phase may seem bureaucratic, it generates a genuine sense of completion and achievement among the team and the company.

2. Learning Phase

The project closing learning phase is dedicated time for the team to reflect on what has been done, how it was done, and the lessons learned now that the project is finished. Various approaches to project closing emphasize learning and growth for both the company as a whole and individual team members.

3. People Phase

The people phase evokes emotions. The team made the project deliverables possible. Acknowledging their work and recognizing the need for emotional closure will make everyone feel good and ready for whatever comes next.

Each step in the project closing process contributes to the development of an appreciation, gratitude, and accomplishment-centered workplace culture. If you take the time to complete this correctly, considering your unique set of circumstances, you will have created the conditions not only for moving on but also for moving forward.

Reasons for Project Termination

Failure and success are two fundamental reasons for terminating projects. To determine which of the reasons is relevant to a project, the team needs to first understand the criteria for success and failure, and then evaluate the project against those criteria.

1. Success

A project achieves success when its objectives and goals are accomplished on time and under budget, deliverables are produced as expected by stakeholders, and the final product is accepted and handed over to the customer (end-user).

2. Failure

A project is considered a failure when its requirements are not met; the customer refuses to accept the product; unresolved technical issues arise, and existing tools and technologies cannot address them; there is an unexpected loss or shortage of human, budget, and other valuable resources; the project effort becomes counterproductive due to the failure to meet initial goals and objectives.

Some more reasons for project termination are as follows:

  1. The requirements or specifications change fundamentally, making it impossible to adjust the underlying contract accordingly.
  2. The specifications and requirements for project outcomes are unclear or unrealistic.
  3. The intended result or product of the project becomes obsolete and is no longer needed.
  4. Lack of project planning, especially risk management.
  5. Technical reasons.
  6. The project cost increases and profit becomes significantly lower than expected.
  7. Adequate human resources, tools, or materials are not available.
  8. The parent organization changes its strategy, and if the project does not support the new strategy.
  9. The parent organization no longer exists.
  10. Necessary conditions disappear.
  11. Force majeure (e.g., earthquake, flooding, etc.).
  12. Lack of management support.
  13. Lack of funding for the project.
  14. Lack of customer support.

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