Finding the Exit
The decision to discontinue a project is often difficult to make. It can be even more difficult to make when the entire project team believes in the viability of the project and its inevitable success. Management is often faced with the decision to funnel more money into an unsuccessful project or to cancel it outright. In such cases, one or more individuals are needed to conduct an objective analysis of the project to determine its viability. This role is often called the “exit champion” or “stopping-champion.” Based on a literature review, this paper examines the reasons why unsuccessful projects are pursued, highlights specific strategies for coping with these projects, and then analyzes the role of the exit champion.
Reasons for Supporting Unsuccessful Projects
Managing a project to its successful completion has proven to be a challenging prospect. Any number of problems can arise which can alter the course of the project. When such problems do arise, the project team must be able to objectively make decisions regarding the continuation of the project. More often than not, however, the project team either feels pressured into continuing a project or the team vehemently believes in the ultimate success of their project, making it difficult to consider termination. Barry M. Staw and Jerry Ross have conducted research on the forces that compel the continuation of unsuccessful projects. In addition, the work of Isabelle Royer has focused on the momentum that can build to continue an unsuccessful project, despite signs of failure. Together their research lends insight into why unsuccessful projects are supported.
Four Factors that Influence the Continuation of Unsuccessful Projects
To understand why project teams continue supporting projects that are unsuccessful, it is useful to look at the situations in which project team members find themselves. In their 1987 Harvard Business Review article, “Knowing When to Pull the Plug,” Barry M. Staw and Jerry Ross highlight four factors that drive project teams to continue pursuing an unsuccessful project.
The first factor that influences the project team is the project itself. Staw and Ross (1987) point out that minor setbacks and issues tend to encourage team members to continue pursuing the project. In fact, some team members may view these setbacks as the cost of conducting business. In addition, Staw and Ross (1987) indicate that the salvage value of a project may cause the team to continue its support. They state that if the project exit is too difficult and the expenditures are not recoverable, the team will continue its support. If the exit is easy and the team can recoup the expenditures, there will likely be less opposition to ending the project (Staw & Ross, 1987).
The second factor highlighted by Staw and Ross is the manager’s motivations. There is a tendency to celebrate the success of those who have persevered despite hardship. Knowing this, project teams may continue in the hope that the project will turn around (Staw & Ross, 1987). Managers may also be motivated to continue a project if they have a biased view of information. They may only see the positives and ignore the negatives (Staw & Ross, 1987). In addition, they may try to prove that the project will be a success by continuing the project, believing that, in time, the project will succeed. Staw and Ross (1987) call this self-justification.
Social pressure is the third factor influencing decisions to continue with unsuccessful projects. Staw and Ross (1987) state that no one wants to appear incompetent or admit mistakes to the organization. Coupled with the fact that persistence is viewed as strength and withdrawal is viewed as weakness, Staw and Ross (1987) believe that few would be motivated to withdraw.
The final factor is organizational pushes and pulls. This primarily consists of administrative inertia, which Staw and Ross (1987) define as “all the rules, procedures, and routines of an organization as well as the sheer trouble it takes for managers to give up day-to-day activities in favor of a serious operational disruption” (p. 4). Such inertia may include the wishes of governing bodies, budget committees, and political groups who are controlling the project’s backing (Staw & Ross, 1987).
The Collective Belief
In her 2003 Harvard Business Review article, “Why Bad Projects are So Hard to Kill,” Isabelle Royer presents additional reasons why project teams continue to support unsuccessful projects. Rather than focus on a myriad of individual factors that may influence decisions, she theorizes that a single “fervent and widespread belief” exists among managers (p. 6). This “collective belief,” which is a belief in the inevitable success of their project, originates within one individual, usually the project champion (Royer, 2003, p.6). As it spreads throughout the organization, it has the potential to lead rational organizations to make irrational decisions and can blind the project team from seeing negatives and setbacks (Royer, 2003).
Royer (2003) states that the collective belief often starts out as the project champion’s hunch and is not usually based in fact or evidence. The belief then permeates through the organizations based on the champion’s credibility and the belief’s alignment with people’s desires. Once the belief begins to perpetuate itself, it gains the power to silence skeptics, resulting in failure warnings being ignored (Royer, 2003). Once ignored, the skeptics usually stop asking questions and this ultimately bolsters the false sense of security cultivated by the collective belief. Royer (2003) states that the greatest danger of the collective belief is that even if problems are acknowledged, they will not be seen as signs of failure or issues that must be resolved. Instead the momentum of the belief pushes the project forward.
Royer’s analysis is largely based on the findings of her research on two French organizations, Essilor and Lafarge. In both studies, a skeptical team member raises concerns about the viability of the project. These concerns are readily discounted due to a lack of experience or credibility and the momentum of the collective belief. Years pass and millions of Francs are spent with little success. Eventually, when company turnover causes some team members to be replaced, the projects are re-examined with fresh eyes and are cancelled (Royer, 2003). These examples neatly illustrate much of Royer’s theory and Staw and Ross’ ways to avoid supporting unsuccessful projects.
Avoiding Support for Unsuccessful Projects: Recognizing Over-commitment
Staw and Ross have developed suggestions for how to avoid the tendency to support unsuccessful projects. These suggestions consist of changing the company or organization by recognizing over-commitment on a project and taking action.
One step in changing the organization is attempting to improve the information system (Staw & Ross, 1987). This consists of encouraging candid reporting of the project’s progress and by improving the honesty of reporting throughout the organization (Staw & Ross, 1987). Another step organizations can take is to turn over the project team (Staw & Ross, 1987). Although this may be costly and disruptive, it can be quite effective, as was illustrated in both of Royer’s examples.
According to Staw and Ross (1987), recognizing over-commitment is difficult. Managers must be able to define project failure and must not let such failure radically change their opinion of themselves. In addition, managers must be able to hear the concerns of others, put the organization before the project, and realize that life continues even when a project ends.
Finally, Staw and Ross state that managers should step away from their projects for a brief time and return to look at the projects from a fresh perspective. Managers should ask themselves if they would support or terminate a project if they picked it up in its current state, thereby assuming the role of an exit champion (Staw & Ross, 1987).
Avoiding Collective Belief
Echoing Staw and Ross to some degree, Royer offers three suggestions on how to avoid the collective belief and its resulting blind faith in a failing project. These suggestions consist of avoiding self-selected teams, establishing early warning systems, and recognizing the role of the exit champion.
Royer (2003) feels that project teams are often self-selected and as a result, the missteps and misunderstandings that often prove fruitful when disparate team members come together never take place. In addition, she feels that skeptics should be included as part of the project team and over time, various members of the team should be rotated out in order to provide a fresh view of the project (Royer, 2003). Such was the case in her Essilor and Lafarge examples, albeit involuntarily.
Her second suggestion states that the organization needs to ensure that the proper controls and procedures need to be put in place in order to evaluate the project at every stage. These controls and procedures must be rigorous, clearly defined, and deployed (Royer, 2003). In the cases of Essilor and Lafarge, these controls were largely ignored.
Finally, she details the role of the exit champion, which Staw and Ross touched on in their suggestions. Royer (2003) believes that the exit champion should be a countervailing force on the project team. When concerns are raised, exit champions must seek objective evidence to substantiate their concerns (Royer, 2003). This allows them to then take action to either validate the concerns as reasons for discontinuing the project or to dismiss them and continue with the project. Royer (2003) feels that exit champions must be recognized as a defined role by the organization’s senior staff. They must also have the freedom to challenge the project at any stage without fear of repercussions (Royer, 2003).
In her 2001 report, “Stopping-champions of Failing Projects,” Royer provides a detailed comparison of the project champion (champion of innovation) and the exit champion (stopping-champion). She states in her report that “at a general level, champions of innovation and stopping-champions share the same characteristics, are needed for the same reasons, and rely on the same tactics to achieve their goals” (p. 18). In addition, she highlights three differences between the two types of champions. First, the champion of innovation can be ambiguous regarding the project’s viability, especially at the outset of a project. Stopping-champions must remove ambiguity (Royer, 2001). Second, champions of innovation face the threat of being wrong in the long-term outcome of the project. Stopping-champions face an immediate threat of being wrong when they cancel a project (Royer, 2001). Finally, champions of innovation do not need to possess the level of credibility when starting a project that stopping-champions must possess when canceling a project (Royer, 2001). Aside from these differences, champions of innovation and stopping-champions are largely similar.
The research of Allan Barnes largely supports Royer’s comparisons. He defines the exit champion as someone whose role is to “gather the hard facts that remove any ambiguity about the success or otherwise of the project” (Barnes, 2004, para. 32). In addition, he notes that exit champions are not hired by management to deliberately terminate a project. To the contrary, the exit champion’s role is to provide the necessary objective assessment for management to continue its support of the project (Barnes, 2004). To Barnes, the exit champion is the complement of the project champion.
Discussion
Making the decision to cancel a project can be difficult. For a variety of reasons, managers and project teams are reluctant to cancel projects. Sometimes personal motivations play a role. Other times, the momentum of the collective belief plays a role. Often, combinations of these elements can dissuade a team from canceling the project. Regardless of the reasons, the literature detailing the support for unsuccessful projects indicates that more often than not, the projects are not cancelled.
The results of Staw and Ross’ research and the results of Royer’s research are interesting. They conducted their research separately and by different means, yet they developed similar suggestions. One could suggest that the studies performed by Royer lend a degree of credibility to the suggestions of Staw and Ross regarding recognizing over-commitment. Indeed, Staw and Ross’ suggestions match the actual events that took place in the case studies of Essilor and Lafarge. In addition, it can be suggested from the similarities found in both bodies of research, that the need for exit champions is indeed valid. The results of the research of both Staw and Ross and that of Royer underscore the validity of this need.
The application of the exit champion, however, poses some problems. It is seemingly counter-productive to formally define this role in a project team, but that is what Royer seems to suggest. Further complicating the issue is Royer’s indication that the exit champion can “emerge” from the project team. This seemingly contradicts her statement that “senior executives need to recognize the exit champion as a defined role” (Royer, 2003, p. 12). Additional clarification is needed in this area. One could suggest that the ideal situation is, in fact, a combination of these two statements. The exit champion should emerge from within the project team at signs of trouble, and once this occurs, should be recognized as a specific role by senior management.
When signs of trouble appear, the decision to cancel a project can be difficult to make. A failing project can compel team members to continue supporting the project hoping to make it successful. A multitude of reasons exist that would compel a team to do so, but at some point, a decision must be made to continue or discontinue the project. The research of Staw and Ross and the research of Royer indicate that this decision should be objective and well researched. The magnitude of such a decision has prompted the researchers to define a new role for this decision making process. Despite the confusion in Royer’s definition regarding the time when an exit champion should materialize, the goal of the exit champion is clear. An objective analysis must be conducted to ensure the viability of the project. Although this role of “exit champion” may not be as prestigious or dynamic as that of the project champion, it is as every bit as crucial.
References
Barnes, A. (2004). True Believers and Their Sceptical Foes. Position Magazine. Retrieved May 1, 2004 from
http://www.positionmag.com.au/POS/content/2004/POS10/pos10_feature/pos10_feature_2.html.
Royer, I. (2001). Stopping-champions of Failing Projects. Academy of Management
Confernece. Washington, D.C.
Royer, I. (2003). Why Bad Projects Are So Hard to Kill. Harvard Business Review, 5-12.
Staw, B. M. & Ross, J. (1987). Knowing When to Pull the Plug. Harvard Business Review, 1-7.
Reasons for Supporting Unsuccessful Projects
Managing a project to its successful completion has proven to be a challenging prospect. Any number of problems can arise which can alter the course of the project. When such problems do arise, the project team must be able to objectively make decisions regarding the continuation of the project. More often than not, however, the project team either feels pressured into continuing a project or the team vehemently believes in the ultimate success of their project, making it difficult to consider termination. Barry M. Staw and Jerry Ross have conducted research on the forces that compel the continuation of unsuccessful projects. In addition, the work of Isabelle Royer has focused on the momentum that can build to continue an unsuccessful project, despite signs of failure. Together their research lends insight into why unsuccessful projects are supported.
Four Factors that Influence the Continuation of Unsuccessful Projects
To understand why project teams continue supporting projects that are unsuccessful, it is useful to look at the situations in which project team members find themselves. In their 1987 Harvard Business Review article, “Knowing When to Pull the Plug,” Barry M. Staw and Jerry Ross highlight four factors that drive project teams to continue pursuing an unsuccessful project.
The first factor that influences the project team is the project itself. Staw and Ross (1987) point out that minor setbacks and issues tend to encourage team members to continue pursuing the project. In fact, some team members may view these setbacks as the cost of conducting business. In addition, Staw and Ross (1987) indicate that the salvage value of a project may cause the team to continue its support. They state that if the project exit is too difficult and the expenditures are not recoverable, the team will continue its support. If the exit is easy and the team can recoup the expenditures, there will likely be less opposition to ending the project (Staw & Ross, 1987).
The second factor highlighted by Staw and Ross is the manager’s motivations. There is a tendency to celebrate the success of those who have persevered despite hardship. Knowing this, project teams may continue in the hope that the project will turn around (Staw & Ross, 1987). Managers may also be motivated to continue a project if they have a biased view of information. They may only see the positives and ignore the negatives (Staw & Ross, 1987). In addition, they may try to prove that the project will be a success by continuing the project, believing that, in time, the project will succeed. Staw and Ross (1987) call this self-justification.
Social pressure is the third factor influencing decisions to continue with unsuccessful projects. Staw and Ross (1987) state that no one wants to appear incompetent or admit mistakes to the organization. Coupled with the fact that persistence is viewed as strength and withdrawal is viewed as weakness, Staw and Ross (1987) believe that few would be motivated to withdraw.
The final factor is organizational pushes and pulls. This primarily consists of administrative inertia, which Staw and Ross (1987) define as “all the rules, procedures, and routines of an organization as well as the sheer trouble it takes for managers to give up day-to-day activities in favor of a serious operational disruption” (p. 4). Such inertia may include the wishes of governing bodies, budget committees, and political groups who are controlling the project’s backing (Staw & Ross, 1987).
The Collective Belief
In her 2003 Harvard Business Review article, “Why Bad Projects are So Hard to Kill,” Isabelle Royer presents additional reasons why project teams continue to support unsuccessful projects. Rather than focus on a myriad of individual factors that may influence decisions, she theorizes that a single “fervent and widespread belief” exists among managers (p. 6). This “collective belief,” which is a belief in the inevitable success of their project, originates within one individual, usually the project champion (Royer, 2003, p.6). As it spreads throughout the organization, it has the potential to lead rational organizations to make irrational decisions and can blind the project team from seeing negatives and setbacks (Royer, 2003).
Royer (2003) states that the collective belief often starts out as the project champion’s hunch and is not usually based in fact or evidence. The belief then permeates through the organizations based on the champion’s credibility and the belief’s alignment with people’s desires. Once the belief begins to perpetuate itself, it gains the power to silence skeptics, resulting in failure warnings being ignored (Royer, 2003). Once ignored, the skeptics usually stop asking questions and this ultimately bolsters the false sense of security cultivated by the collective belief. Royer (2003) states that the greatest danger of the collective belief is that even if problems are acknowledged, they will not be seen as signs of failure or issues that must be resolved. Instead the momentum of the belief pushes the project forward.
Royer’s analysis is largely based on the findings of her research on two French organizations, Essilor and Lafarge. In both studies, a skeptical team member raises concerns about the viability of the project. These concerns are readily discounted due to a lack of experience or credibility and the momentum of the collective belief. Years pass and millions of Francs are spent with little success. Eventually, when company turnover causes some team members to be replaced, the projects are re-examined with fresh eyes and are cancelled (Royer, 2003). These examples neatly illustrate much of Royer’s theory and Staw and Ross’ ways to avoid supporting unsuccessful projects.
Avoiding Support for Unsuccessful Projects: Recognizing Over-commitment
Staw and Ross have developed suggestions for how to avoid the tendency to support unsuccessful projects. These suggestions consist of changing the company or organization by recognizing over-commitment on a project and taking action.
One step in changing the organization is attempting to improve the information system (Staw & Ross, 1987). This consists of encouraging candid reporting of the project’s progress and by improving the honesty of reporting throughout the organization (Staw & Ross, 1987). Another step organizations can take is to turn over the project team (Staw & Ross, 1987). Although this may be costly and disruptive, it can be quite effective, as was illustrated in both of Royer’s examples.
According to Staw and Ross (1987), recognizing over-commitment is difficult. Managers must be able to define project failure and must not let such failure radically change their opinion of themselves. In addition, managers must be able to hear the concerns of others, put the organization before the project, and realize that life continues even when a project ends.
Finally, Staw and Ross state that managers should step away from their projects for a brief time and return to look at the projects from a fresh perspective. Managers should ask themselves if they would support or terminate a project if they picked it up in its current state, thereby assuming the role of an exit champion (Staw & Ross, 1987).
Avoiding Collective Belief
Echoing Staw and Ross to some degree, Royer offers three suggestions on how to avoid the collective belief and its resulting blind faith in a failing project. These suggestions consist of avoiding self-selected teams, establishing early warning systems, and recognizing the role of the exit champion.
Royer (2003) feels that project teams are often self-selected and as a result, the missteps and misunderstandings that often prove fruitful when disparate team members come together never take place. In addition, she feels that skeptics should be included as part of the project team and over time, various members of the team should be rotated out in order to provide a fresh view of the project (Royer, 2003). Such was the case in her Essilor and Lafarge examples, albeit involuntarily.
Her second suggestion states that the organization needs to ensure that the proper controls and procedures need to be put in place in order to evaluate the project at every stage. These controls and procedures must be rigorous, clearly defined, and deployed (Royer, 2003). In the cases of Essilor and Lafarge, these controls were largely ignored.
Finally, she details the role of the exit champion, which Staw and Ross touched on in their suggestions. Royer (2003) believes that the exit champion should be a countervailing force on the project team. When concerns are raised, exit champions must seek objective evidence to substantiate their concerns (Royer, 2003). This allows them to then take action to either validate the concerns as reasons for discontinuing the project or to dismiss them and continue with the project. Royer (2003) feels that exit champions must be recognized as a defined role by the organization’s senior staff. They must also have the freedom to challenge the project at any stage without fear of repercussions (Royer, 2003).
In her 2001 report, “Stopping-champions of Failing Projects,” Royer provides a detailed comparison of the project champion (champion of innovation) and the exit champion (stopping-champion). She states in her report that “at a general level, champions of innovation and stopping-champions share the same characteristics, are needed for the same reasons, and rely on the same tactics to achieve their goals” (p. 18). In addition, she highlights three differences between the two types of champions. First, the champion of innovation can be ambiguous regarding the project’s viability, especially at the outset of a project. Stopping-champions must remove ambiguity (Royer, 2001). Second, champions of innovation face the threat of being wrong in the long-term outcome of the project. Stopping-champions face an immediate threat of being wrong when they cancel a project (Royer, 2001). Finally, champions of innovation do not need to possess the level of credibility when starting a project that stopping-champions must possess when canceling a project (Royer, 2001). Aside from these differences, champions of innovation and stopping-champions are largely similar.
The research of Allan Barnes largely supports Royer’s comparisons. He defines the exit champion as someone whose role is to “gather the hard facts that remove any ambiguity about the success or otherwise of the project” (Barnes, 2004, para. 32). In addition, he notes that exit champions are not hired by management to deliberately terminate a project. To the contrary, the exit champion’s role is to provide the necessary objective assessment for management to continue its support of the project (Barnes, 2004). To Barnes, the exit champion is the complement of the project champion.
Discussion
Making the decision to cancel a project can be difficult. For a variety of reasons, managers and project teams are reluctant to cancel projects. Sometimes personal motivations play a role. Other times, the momentum of the collective belief plays a role. Often, combinations of these elements can dissuade a team from canceling the project. Regardless of the reasons, the literature detailing the support for unsuccessful projects indicates that more often than not, the projects are not cancelled.
The results of Staw and Ross’ research and the results of Royer’s research are interesting. They conducted their research separately and by different means, yet they developed similar suggestions. One could suggest that the studies performed by Royer lend a degree of credibility to the suggestions of Staw and Ross regarding recognizing over-commitment. Indeed, Staw and Ross’ suggestions match the actual events that took place in the case studies of Essilor and Lafarge. In addition, it can be suggested from the similarities found in both bodies of research, that the need for exit champions is indeed valid. The results of the research of both Staw and Ross and that of Royer underscore the validity of this need.
The application of the exit champion, however, poses some problems. It is seemingly counter-productive to formally define this role in a project team, but that is what Royer seems to suggest. Further complicating the issue is Royer’s indication that the exit champion can “emerge” from the project team. This seemingly contradicts her statement that “senior executives need to recognize the exit champion as a defined role” (Royer, 2003, p. 12). Additional clarification is needed in this area. One could suggest that the ideal situation is, in fact, a combination of these two statements. The exit champion should emerge from within the project team at signs of trouble, and once this occurs, should be recognized as a specific role by senior management.
When signs of trouble appear, the decision to cancel a project can be difficult to make. A failing project can compel team members to continue supporting the project hoping to make it successful. A multitude of reasons exist that would compel a team to do so, but at some point, a decision must be made to continue or discontinue the project. The research of Staw and Ross and the research of Royer indicate that this decision should be objective and well researched. The magnitude of such a decision has prompted the researchers to define a new role for this decision making process. Despite the confusion in Royer’s definition regarding the time when an exit champion should materialize, the goal of the exit champion is clear. An objective analysis must be conducted to ensure the viability of the project. Although this role of “exit champion” may not be as prestigious or dynamic as that of the project champion, it is as every bit as crucial.
References
Barnes, A. (2004). True Believers and Their Sceptical Foes. Position Magazine. Retrieved May 1, 2004 from
http://www.positionmag.com.au/POS/content/2004/POS10/pos10_feature/pos10_feature_2.html.
Royer, I. (2001). Stopping-champions of Failing Projects. Academy of Management
Confernece. Washington, D.C.
Royer, I. (2003). Why Bad Projects Are So Hard to Kill. Harvard Business Review, 5-12.
Staw, B. M. & Ross, J. (1987). Knowing When to Pull the Plug. Harvard Business Review, 1-7.
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