"Those who dare to fail miserably can achieve greatly." ― John F. Kennedy
"Those who dare to fail miserably can achieve greatly." ― John F. Kennedy
Every project begins with the best intentions. You plan them with the utmost optimism and wholeheartedly believe there will be a positive return on investment. Yet, your wishes don’t always come true. Sometimes, your projects don’t deliver the value you expected them to.
This isn’t always immediately obvious. While it’s true that some projects catastrophically crash — financially and operationally — some merely veer off track. They may still bring you success to a certain extent, but it’s not the success you’re looking for.
For the sake of this article, we’ll refer to these two types of projects as “failed” and “non-failed”. While the former holds more risk, they can both negatively impact your business’s bottom line and steal away resources from your successful projects.
To ensure you focus on the most profitable ventures, you need to learn how to identify these projects and, more importantly, how to kill them. Today, we’ll help you do just that.
Trimming the Fat: How to Kill Projects in 5 Steps
1. Determine Your Guiding Reasons for Killing Projects
Before you can begin to find candidates for culling, you need to understand your reasoning. Why would you want to retire a project? What factors would cause you to kill a project in future?
It’s much easier to justify killing a failed project. In this circumstance, you’ll likely encounter worrying financial data, such as budget overflows or lost revenue, as well as resourcing issues. A failed project may either provide no financial reward or demand an overwhelming amount of resources.
It’s not quite so simple to justify killing non-failed projects. In these instances, you need to dig deeper and analyze your project data and business needs over time. With that in mind, your reasons for killing may include:
- Changing priorities. Businesses change, as will your priorities. A long-term project you kickstarted over a year ago may not align with your organization’s current ambitions.
- Diminishing returns. Perhaps your projects are bringing in money, but the return on investment is decreasing over time.
- Innovation needs. To stay profitable, you need to keep pace with competitor services and changing customer needs. If your projects (or products) go against the tide of innovation, you might have to cull them.
These are top-level strategic reasons for killing projects. But opinions may vary. Stakeholder 1 may believe profit will continue to dwindle; Stakeholder 2 may believe you can turn it around by the next quarter. Alternatively, Stakeholder 1 may think your customer base appreciates your old-school product; Stakeholder 2 may disagree, believing innovation is absolutely necessary. However, while these opinions are useful, you cannot rely on them alone when decided whether to kill a project.
To identify further concrete reasons — or indeed warning signs — you’ll need to dig deeper.
2. Reflect on Extinct Projects and Find Warning Signs
Specifically, reflect on extinct projects you wish you had killed earlier. By evaluating the lessons learned, you’ll be better equipped to identify non-successful projects in the future.
Take apart these killed projects and answer the following:
- What was the negative impact of these projects? Which projects lost you money? Which took up too many resources or caused stress for your project teams?
- Why do your project teams and stakeholders believe the project failed?
- Were there common patterns between these projects? For example, did they follow the same project management methodology or use the same supplier?
Digging into these specifics will help you unearth the typical warning signs to watch out for in your current and future initiatives.
3. Facilitate Honest and Proactive Conversations
You’ve identified your reasons for killing projects. You’ve also reflected on your past errors and pinpointed warning signs. Now, it’s time to focus on how you carry these lessons with you going forward.
As you embark on new projects, you’ll want to adopt a proactive mindset and facilitate honesty. Encourage stakeholders of all levels to speak up when they believe a project is showing signs of failing or veering off track. To make this easier, you could set up monthly feedback calls or even create a standardized risk-flagging process. For instance, a project team member may have to fill out a dedicated form to escalate concerns to the project manager.
It’s also important to establish a decision-making framework that incorporates both quantitative metrics (such as ROI, customer acquisition cost, and churn rate) and qualitative insights (such as customer satisfaction and brand reputation). By setting thresholds for these metrics, you can assess the project’s viability.
4. Track Project Data and Create Scenarios
Equally, you’ll also want to keep a close eye on your project data to justify your decisions. To give you a bird’s eye view of success and risk, create a metric-filled project dashboard.
This should display key financial data, such as Net Present Value (NPV) and Internal Rate of Return (IRR), as well as deadlines, risk status, stakeholder and OKR alignment, and budgeting.
Understanding this project data will allow you to develop various predictions for the future of the project, including best-case, worst-case, and most-likely scenarios. In some cases, it’ll be possible to assess the impact of innovations and how they might change these scenario outcomes.
5. Take the Emotion Out of Your Decisions
Some stakeholders may hold onto a project due to the fear of perceived failure — or because they’re closely attached to the initiative.
But failures, whether they’re big or small, happen. In the long run, it’s better to kill unsuccessful projects sooner rather than later. Especially if you notice any of the reasons or warning signs in steps 1 and 2.
To make your decisions easier:
- Balance out emotion with logic. To solidify your reasoning for killing a project, look to tangible project data. How is the financial forecast looking? Are tasks over budget and deadline? It’ll be difficult for stakeholders to push back against concrete data. You can also conduct market research to validate the assumptions made during your scenario planning.
- Think of the wider impact. For larger organizations that juggle multiple projects, adopt a portfolio mindset. Try to discern the impact this one project could have on your other projects. Is it taking away resources and budgeting from more successful initiatives?
- Bring in support. When deciding whether you should or shouldn’t kill a project, tackle it as a collective. This can help to bring in diverse perspectives and mitigate some of the stress involved.
- Make a note of lessons learned. Once you come to a decision and present your rationale clearly to all stakeholders, review the outcome of the experience. What went well? What didn’t? Collect these lessons in a document which can be used to improve the decision-making of future projects.
We can’t guarantee everyone involved will feel okay once you’ve killed the project. For some stakeholders, attachments may remain. So, to make the process of letting go easier, we’d also recommend dissecting the project in question and finding successes within the failures.
No project — living or dead — is a waste. The lessons you learned along the way will help you improve upon future initiatives and ensure better outcomes.
