I have been looking at failed projects and am unsure whether to include those that are stopped. Is it a failure if it has been stopped? Or was it the right answer to stop it, so that the business can avoid the costs of completing something not worth it? Microsoft has conducted research that shows that 15% of projects are terminated before they are completed. These projects failed to meet their success criteria so they are failing?
It can be difficult to decide whether or not to end a project. However, it is sometimes necessary. There are many reasons why projects are stopped, such as:
Changes in the organisational culture
The reason for doing the project changes, for instance, if the project is no longer needed
The business operation is changing
The business case is no longer viable.
The project sponsor leaves, and the drive behind it disappears
The regulatory environment is changing
If a division is sold, or another critical project takes up resources, business priorities change.
Any other important element of the project environment is affected.
In these cases, it may be wise to stop the project. It is not worth continuing to deliver something that does not add value or solve a business problem. It would be a waste to continue the project.
This type of project should be managed in a controlled manner. That is, the management of the project’s shut down must be done in a way that redeploys and salvages resources. It also needs to handle awkward questions through a planned communication campaign.
Directors believe that 19% should be shut down. Only 15% of projects are closed, so we can conclude there are an additional 44% of projects that continue and add no value to the companies that pursue them. This adds up to PS13.4 million annually for the average large UK company.
We can conclude that projects that are not completed before they are finished aren’t necessarily failed. Failures are those projects that continue to work when they shouldn’t and don’t deliver any value.