It is strange, but projects once started are like super-tankers, almost unstoppable. Sponsors and stakeholders seem to develop an almost parent like relationship to a project. The thought of cancelling a project is not easy for those involved. But from the portfolio and organisational point of view any project that is at risk of not delivering benefit should be high on the candidate list to cancel.
Signs of when a project should be closed
High on the list of projects that should be seriously considered for culling, are those that are running beyond budget or past timescale. In the case of budget overrun, you can often hear the argument that a project has spent £5M and what a waste it would be to lose that money. But better to lose £5M than continue a failed project resulting in wasting £10M, or even £5.1M for that matter. But even where a project is over budget or late, it should not be automatically stopped. The overruns indicate that benefit may not be realised. The business case should be reviewed and if the project still shows clear (and maybe reduced benefit) it should continue.
But even in projects that are delivering on time and within budget there can be candidates for the project to be stopped. Where the reason for the project has changed. Or if the legislative basis for the project shifted beyond its current output; then closure is likely. In these cases, a project might need to undergo a major overhaul, even if it does not close.
Any project that can not deliver benefit for whatever reason should be a clear contender for cancelling.
How can a Project be closed?
The suggestion to close a project should come from the sponsor, or the project management. A good PMO may also suggest candidate projects for close review. The decision for the project to be formally closed should involve portfolio management. Cancellation must be confirmed by the sponsor and executive management, depending on the nature and size of the project. The exact process will vary between organisations. This process can be difficult in organisations that do not formally review projects and have not cancelled them in the past.
Benefits to the Portfolio of kill projects
Although it is difficult to start this type of review, there are clear benefits in finishing failing projects early. The organisation increases the chances of delivering beneficial projects. Freeing up key resource for better projects. Allowing the focused spend of limited funds. As well as allowing the organisation to concentrate on better focused change.
So always consider closing a project that will not give benefit. In the long run it will be far more helpful than continuing to do the wrong thing.