Coping with Troubled Projects: Time for Rescue or Graceful Exit?

Even the best of projects can become "troubled".  But, catastrophic "trouble" rarely happens all at once and usually develops over time.  Fortunately, there are always signs, and the smart project manager learns how to read them and how to act accordingly.  Read on for more.

Reading the Signs of a Troubled Project

What is a troubled project?

Every project has problems and issues.  That does not make it a "troubled project".  To be called troubled, problems and issues must go beyond the norm, and fall into the realm of continuing and significant.  In other words, the nature and consistency of the problems and issues must be such that they present a tangible threat to the project result and/or continuity of the project management process.

What are some of the most common signs of a troubled project?

1. The overall "mood" of the project is negative.
2. "Things" are just not going as planned, notably from a procedural, scheduling, budget and/or resource point of view.
3. Major milestones are being missed on a frequent basis.
4. Deliverables are not performing as expected (considering testing, acceptance and success citeria).
5. Stakeholder attitude is poor, with multiple, persistent conflicts and disagreements.
6. The project team is noticeably "under-performing", and morale is continually low.
7. Executive management interest in the project has been steadily decreasing.
8. Status reports are continually negative (reporting excessive variances and "off-plan" charaterizations).

Again, it is important to remember that "trouble" is more than just the existence of the above listed circumstances and conditions --- "trouble" is about persistance, frequency and the overwhelming sense that the "negative" greatly outweighs the positive.  That's the nature of a troubled project - and you'll know it when you see it (as long as your eyes are open).

The Big Question: Why is the Project Failing?

As we have already noted, projects may be headed towards failure for any number or combination of reasons. If you are to react properly, you must be able to readily identify those reasons as they apply to a project at hand. The most common reasons for project failures are poor concepts (failure to define, align and approve), inadequate planning, lack of resources (time, money, staffing and/or materials), overly aggressive scheduling, failure to keep up with changing circumstances, lack of management support, and related factors.  (Also Read:  Planning for Project Management Audits)

Whatever the underlying negatives may be, when in the midst of a troubled project, action must be taken - quickly, decisively, and with discretion.  The first step is to perform a "troubled project assessment".

Performing the Troubled Project Assessment

The troubled project assessment can be performed in four (4) primary steps, designed to weigh the value, consequences and viability of project continuation vs. cancellation:

#1 - Can this project be saved by re-working project plans, reducing project scope, revised deliverables, staff changes, resource leveling, revised schedules, additional funding, team re-organization, or other related actions?  Note:  If the answer is yes, the focus can then shift to remedial action. 

#2 - What are the benefits of cancellation? When you cancel a project, you need to be sure that cancellation is the best course of action. Project cancellation can yield many benefits, even though it signals the end of a previously chosen project initiative. When a project is cancelled it can save money, time, and free up resources to work on more important, potentially successful projects.

#3 - Do you have cancellation consensus? Project managers rarely have the ability to cancel a project unilaterally, and even if they did, it would be unwise to exercise that power without consultation and consensus. A canceled project is not necessarily a management failure, particularly when the cancellation is appropriate and timely. But it is important to have the buy-in of all key stakeholders and participants including your project sponsors, management, end-users and team members.

#4 - What is the potential "cancellation impact" on project staff, end-users, related projects, regulatory requirements, or other related factors?

And if cancellation is in order, what's next?

1. Prepare a documented "Project Cancellation Statement", explaining why, how and when the project is to be cancelled.
2. Consult with supporting departments as needed ....(i.e. Legal and Human Resources) to ensure that your cancellation approach is appropriate.
3. Obtain all necessary management approvals.
4. Inform the project team and all major stakeholders.
5. Formally announce the project cancellation as needed according to project nature and visibility.
6. Re-assign project team members to other projects or to return to regular work assignments.
7. Release contractors and temporary staff as needed.
8. Initiate and complete a post project review.
9. Finalize project documentation and retain as needed for future projects, or for any potential project revitalization.

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