The document discusses project termination or closure, outlining various methods including termination by extinction, addition, integration, and starvation. It highlights indicators that may signal the need for termination, such as alignment with organizational goals and team enthusiasm. The termination process involves a structured decision-making and implementation approach, with defined responsibilities for a termination manager to ensure a smooth and orderly conclusion of the project.

1. Project Termination /Closure
Dr. Parmeshwar Biradar
MBA (Finance, HR, Operations Management), SET, PhD (
Commerce and Management)

2. Project Life Cycle

3. Project Termination /Closure
Concept:
Project Termination (also called as "project closure" and
"project finalization") is a situation when a given project
is supposed to be closed or finalized because there’s no
more need or sense for further continuation.
Project termination is managed under a respective
procedure that requires the management team to
examine current state of the project work, review
progress of goals and objectives, evaluate the project
against success criteria and check status of deliverables.

4. Project Termination /Closure : Ways /
Types
Termination
by
Extinction
Termination
by Addition
Termination
by
Integration
Termination
by
Starvation

5. Project Termination /Closure : Ways /
Types
1) Termination by Extinction:
The project is stopped. It may end because it has been
successful and achieved its goals: The new product has
been developed and handed over to the client, or the
software has been installed and is running.
2) Termination by Addition:
Most projects are “in-house”, i.e., they are carried out by
the project team for use in the parent organization. If a
project is a major success, it may be terminated by
institutionalizing it as a formal part of the parent
organization.

6. Project Termination /Closure : Ways /
Types
3) Termination by Integration:
This method of terminating a project 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. The output of the project becomes a
standard part of the operating systems of the parent or client.
4) Termination by Starvation:
is a fourth type of project termination, although strictly
speaking, it is not a “termination” at all. It is “slow starvation
by budget decrement.” Almost anyone who has been involved
with projects over a sufficient period of time to have covered
a business recession has had to cope with budget cuts.

7. Non-technical Reasons behind
Termination:
1) Political Terminations:
This type of project demise is mentioned when discussing termination by murder. These
terminations are typically the result of conflict between senior managers, one of whom
may be terminated along with the project.
2) Cross-cultural Terminations:
Multinational projects sometimes fail because the different cultural groups do
not/cannot communicate well, or because their working styles do not/cannot mesh.
The conflicts arise when poor communication or diverse working styles cause the
different cultures to compete for ascendancy or to engage in win/lose negotiations.
The same cross-cultural forces operate when different disciplines, e.g., marketing and
engineering, develop precisely the same problems.
3) Senescence Terminations:
There are projects that pass away simply because senior managers, the project
champion, the PM and even key project workers lose interest in the project. The
project has neither failed nor succeeded. It simply exists. Meanwhile, other new
exciting ideas are being projected. The organization’s attention (and resources) is
being directed elsewhere. The conflict between the old and the new may not be
active. The senescent project simply gives way to the new.

8. When to Terminate a Project: Indicators
1. Is the project still consistent with organizational goals?
2. Is it practical? Useful?
3. Is management sufficiently enthusiastic about the project to support its
implementation?
4. Is the scope of the project consistent with the organization’s financial
strength?
5. Is the project consistent with the notion of a “balanced” program in all
areas of the organization’s technical interests? In “age”? In cost?
6. Does the project have the support of all the departments (e.g., finance,
manufacturing, marketing, IT, legal, etc.) needed to implement it?
7. Is organizational project support being spread too thin?
8. Is support of this individual project sufficient for success?
9. Does this project represent too great an advance over current technology?
Too small an advance?

9. When to Terminate a Project:
Indicators
1. Is the project team still innovative, or has it gone stale?
2. Can the new knowledge be protected by patent, copyright, or trade
secret?
3. Could the project be farmed out without loss of quality?
4. Is the current project team properly qualified to continue the project?
5. Does the organization have the required skills to achieve full
implementation or exploitation of the project? Has the subject area of the
project already been “thoroughly plowed”?
6. Has the project lost its key person or champion?
7. Is the project team enthusiastic about success?
8. Can the potential results be purchased or subcontracted more efficiently
than developed in-house?
9. Does it seem likely that the project will achieve the minimum goals set for
it? Is it still profitable? timely?

10. The Termination Process:
a) The Decision Process:
Decision-aiding models for the termination decision fall into two generic
categories:
1) First, there are 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 (or failed) projects.
2) Second, there are models that base the decision on the degree to which
the project meets the goals and objectives set for it.
b) The Implementation Process:
Once it has been decided to terminate a project, the process by which it will
be terminated must be implemented. The actual termination can be planned
and orderly, or a simple hatchet job. The former is apt to have significantly
better results, and so researchers suggest that the termination process be
planned, budgeted and scheduled just as is done for any other phase of the
project life cycle.

11. Duties of Termination Manager:
The primary duties of the termination manager are encompassed in the
following nine general tasks:
1) Ensure completion of the work, including tasks performed by
subcontractors.
2) Notify the client of project completion and ensure that delivery (and
installation) is accomplished. Acceptance of the project must be
acknowledged by the client.
3) Ensure that documentation is complete, including a terminal evaluation of
the project deliverables and preparation of the project’s Final Report.
4) Clear for final billings and oversee preparation of the final invoices sent to
the client.
5) Redistribute personnel, materials, equipment and any other resources to the
appropriate places.

12. Duties of Termination Manager:
6) Clear project with legal counsel or consultant. File for
patents if appropriate. Record and archive all “nondisclosure”
documents.
7) Determine what records (manuals, reports and other
paperwork) to keep. Ensure that such documents are stored in
the proper places and that responsibility for document
retention is turned over to the parent organization’s archivist.
8) Ascertain any product support requirements (e.g., spares,
service), decide how such support will be delivered, and assign
responsibility.
9) Oversee the closing of the project’s books.