In project management, we’re often asked to perform tech and business project recovery for floundering software implementation initiatives. But it takes skill to tell the difference between projects that are worth saving and those that are best left to die on the vine. In this blog, I’ll help you tell the difference.
In brief:
- Not every project is worth saving. The basics of business project recovery can help identify when a project is too far gone due to sunk costs, unrealistic goals, or stakeholder misalignment.
- Look for indicators like misunderstood severity, sunk cost fallacy, or whether the core objective is still valid.
- Compare rescue vs. termination costs. Consider financial, reputational, and resource tradeoffs before deciding to continue or stop.
- Communicate clearly with stakeholders. Present risks and options transparently to guide executive decision-making.
- A true recovery requires reevaluating scope, rebaselining the timeline, restructuring the team, improving communication, and focusing on quick wins.
When a business project starts to go off the rails — missing deadlines, overrunning budgets, or losing stakeholder alignment — project managers face a tough call: should they aim for business project recovery or cut their losses? This decision is especially critical in high-stakes initiatives like artificial intelligence (AI) implementations, where a failed project that reaches production can cause lasting damage through privacy breaches, copyright violations, and misinformation.
The reality is not all projects are worth salvaging. In fact, a recent study found that 42 percent of organizations abandon their AI proof-of-concepts before production — recognizing early when to step away. Making this call requires both technical insight and emotional distance, something that’s often difficult for project leaders navigating sunk costs and sponsor pressure.
“The most important thing project managers and project leaders need is the ability to plan forward, not record backward,” says my colleague and project management office (PMO) lead Rick Morris. “They must look at the past objectively, accept what’s not working, adjust accordingly, and keep going. The ability to do that — combined with technical skills — allows them to be more strategic and deliver real value to organizations.”
Centric’s Chicago team senior manager John Kackley says, “It can be a hard message to hear, but many projects simply cannot be rescued without significant changes to their structure, scope, resources, approach, or objective. After all, if all your project needed was a minor tweak, no one would be talking about rescuing it.”
In this blog, we’ll explore the signs that indicate a project may be beyond saving, how to communicate these challenges to stakeholders, and the steps to take if you determine that recovery is possible.
The Struggle to Let Go
The pressure to rescue a struggling project is often felt by both project sponsors and leaders. There are financial, emotional and sometimes reputational reasons why they may hesitate to pull the plug. The perceived sunk costs — the time, money and effort already invested — can cloud objective decision-making. Recognizing when tech or business project recovery is beyond reach requires a high level of objectivity and a willingness to make difficult decisions.
A notable example of this is RTE’s failed IT project in Ireland. The national broadcaster embarked on an ambitious initiative to overhaul its finance and human resource (HR) systems, investing €3.6 million from the proceeds of a land sale. Despite the substantial investment, the project was only partially implemented and ultimately abandoned.
This decision came after significant scrutiny and pressure from various stakeholders, highlighting the challenges organizations face in acknowledging and addressing project failures.
Before you can make the ultimate decision like RTE, however, you need to understand the signs of a project that is on the brink of failure. Projects may seem like they are close to success but are, in fact, completely off-track. Other times, what seems like a manageable challenge can evolve into something far more complicated. Recognizing when a project is truly unsalvageable is the first step in deciding whether to kill it or save it.
5 Ways to Determine Tech and Business Project Recovery Status
Not all failing projects are beyond saving, so how do you differentiate between projects that are already dead and those that still have a fighting chance? Here are five key indicators to help you decide:
1. Misunderstanding Severity
Often, project sponsors think they’re close to a breakthrough when, in reality, the project is already in crisis mode. A project that feels like it’s on the edge of needing a rescue but is still facing major issues — such as missed deadlines, lack of stakeholder alignment, or overspent budgets — may be in worse shape than it appears.
Verdict: If disaster recovery efforts feel more like trying to contain a fire that’s already raging, it might be time to let it go.
2. Throwing Good Money After Bad
In some cases, the project’s goals are no longer viable or realistic, but resistance to stopping is due to the emotional and financial investments already made. A good leader knows when to cut their losses and accepts that the best course of action is to stop the project or scale it down significantly.
Verdict: This may not be a complete cancellation, but it’s a gentle “death.” Adjust the scope and goals to something more achievable rather than continuing with something that was doomed from the start.
3. Factoring in Stubbornness
Some projects suffer from the sunk cost fallacy, where the need to justify all the work that has already gone into the project leads to unnecessary sacrifices. This leads to a situation where no matter how much more effort the failing project requires, it must succeed because there’s too much at stake.
Verdict: If this is the situation, continued sacrifice is likely not justified, and it’s time to pull the plug.
4. Assessing the Extent of the Problem
Not all challenges signal the end of a project. A project facing obstacles but still maintaining a clear objective may be salvageable with the right adjustments. In these cases, the project manager reevaluating timelines, restructuring the team, and adjusting resources can help get the troubled project back on track.
Verdict: If the project’s core objective is still valid, this is a candidate for rescue.
5. Embracing Failure
In some organizations, project failure is seen as part of the process. The expectation is that some projects will fail, and this is an accepted part of pushing innovation. If you’re in an environment where the goal is to test multiple competing initiatives and let the best one survive, don’t waste resources trying to salvage a troubled project that’s unlikely to succeed.
Verdict: The best course here is to terminate the failing project and move on.
Once you’ve identified whether the project rescue is worth the effort or is beyond saving, the next critical step is to evaluate the costs involved in either continuing with the recovery efforts or terminating the project altogether.
Measure the Cost of Rescue vs. the Cost of Termination
After assessing the potential for a business project recovery plan, you need to consider the associated costs, which are not merely financial. They encompass resource allocation, opportunity costs, and potential impacts on organizational reputation and stakeholder trust.
Recent studies highlight the prevalence and impact of cost overruns in various sectors. In fact, 33 percent of organizations have experienced cost overruns for their enterprise resource planning (ERP) implementations. And, a study in the “Journal of Management Information Systems” discovered that large IT projects are typically 45 percent over budget, with some projects seeing cost increases of up to 400 percent.
Keeping that in mind, it’s critical to consider the costs involved in either keeping a project on or letting it go. Does the cost of trying to save a project outweigh the cost of terminating it? Here is how to.
- Cost of Rescue — This includes all resources needed to turn the project around. Will it require extra personnel? Is there a significant time investment for stakeholders? Are there technological challenges that need to be addressed?
- Cost of Termination — Are there legal, contractual or reputational risks? What’s the cost of realigning resources or switching to a different solution?
Rick Morris is passionate about AI’s ability to tease out these costs.
“AI can identify similar patterns from past projects and suggest interventions,” Morris says. “However, and perhaps most importantly, AI can help quantify the value of PMO activities, like calculating the savings from canceling a project early rather than letting it fail after significant investment. This information can provide concrete ROI (return on investment) metrics that have traditionally been difficult to demonstrate.”
Whether or not you use AI to calculate the costs, AI will use its knowledge of challenges presented by previous work to avoid future roadblocks, making it easier for leaders to see how they can reach their destination. That will help build the C-suite support you need as you begin holding candid conversations with your project sponsors or advisory council about the future direction.
Discuss Your Project’s Future
Talking to project sponsors about struggling initiatives can be a difficult conversation, but transparency is key.
Now that you’ve communicated your findings and laid out the necessary steps, you know you either need to get rid of the project or figure out how to turn it around if recovery is still possible. Letting a project go is potentially the easier of the two tasks at hand. But what do you need to do if the project is salvageable?
How to Rescue a Failing Project
Once you’ve determined the project is not beyond saving, the next step is to breathe new life into it. However, recovery is not as simple as making small adjustments. It requires a comprehensive, multifaceted approach that addresses the root causes of the issues while aligning the project back to its core objectives.
As highlighted earlier, you cannot rescue a project without significant changes to its structure, scope, resources, approach, or objectives. If all it took were minor tweaks, you wouldn’t be talking about rescuing it.
Here are five steps to take to establish a tech or business project recovery plan and turn it around — along with real examples and implementation tips from our project and program management experience:
1. Reevaluate the Scope and Objectives
One of the first things you need to do during your project rescue is to revisit its original scope and objectives. Are they still realistic given the current situation, or have circumstances changed in ways that make those goals unattainable?
In some cases, scaling back the scope or redefining what constitutes a “successful” project can make a big difference.
Our Story
We started by integrating several legacy systems into one platform. Halfway through, we faced technical issues and resource shortages. The original circumstances changed.
To achieve our original objectives, we pivoted to integrating the most important systems first. This helped us meet the deadline and deliver essential functionality to the client.
How We Implemented
- Identified areas where we could make quick and impactful changes
- Released a smaller but functional feature update to show tangible progress
- Set up regular reviews to continuously assess and refine our approach
These steps helped ensure ongoing improvements while rallying the team, maintaining stakeholder trust, and keeping the project moving forward.
2. Rebaseline the Schedule
A struggling project may have missed several deadlines or is on track to miss even more. It’s essential to reset the timeline and communicate new, realistic deadlines to stakeholders. Be sure to include buffers for unforeseen challenges.
Our Story
We were managing a software upgrade project for a client when — once again — unexpected technical issues arose. To get back on track, we rebaselined the schedule, setting new, realistic deadlines and including extra time for unforeseen challenges.
How We Implemented
- Reviewed the project’s timeline and identified the root causes of the delays
- Established new, achievable deadlines, including buffers for unforeseen challenges
- Documented all adjustments for accountability and communicated the new schedule clearly to all stakeholders
This approach helped manage expectations, optimize resources, and mitigate risks, ensuring project momentum and stakeholder trust.
3. Reorganize the Team
Sometimes, the existing team structure is one of the biggest obstacles to a project’s success. If team members are overloaded or if the team’s skill sets don’t align with project needs, reshuffling responsibilities — or even bringing in new team members — might be necessary.
Our Story
We had taken on an ERP implementation project that had stalled due to lack of expertise in integrating complex systems. To address the gap, we brought in a solutions architect. This change was crucial for aligning the team’s skills with the project needs and significantly improved progress.
How We Implemented
- Assessed the team structure and identified skill gaps
- Clarified responsibilities and brought in new expertise
- Communicated every adjustment to all stakeholders
This approach helped optimize resources, improve efficiency, and maintain stakeholder trust.
4. Increase Communication and Transparency
Poor communication among stakeholders, such as struggles in the approval process, can lead to bottlenecks, unrealistic expectations (positive or negative), and a lack of transparency that erodes trust.
Our Story
We were working on a business improvement project that had gone off the rails due to delays in approvals from key stakeholders.
How We Implemented
- Set up regular check-ins with the team and stakeholders
- Ensured everyone was aligned on progress and challenges
- Communicated openly about any issues and delays
This approach improved the approval process, prevented the delays from escalating, and kept everyone informed and engaged.
5. Focus on Continuous Improvement
You can’t fix a process and then walk away from it. True business process improvement requires a continuous cycle of (re) implement, evaluate and adjust.
Our Story
We were working on a technology project that had fallen behind schedule. Employees were down and frustrated. To address the problem, we focused on achieving quick wins. This approach restored confidence and momentum, demonstrated progress to stakeholders, and fostered a culture of continuous improvement.
How We Implemented
- Identified areas where we could make quick and impactful changes
- Released a smaller but functional feature update to show tangible progress
- Set up regular reviews to continuously assess and refine our approach, ensuring ongoing improvements
This strategy helped rally the team, maintain stakeholder trust, and keep the project moving forward.
By focusing on these five critical steps, you can breathe new life into a project and steer it toward success, even when the road ahead seems challenging.
Turn Challenges Into Tech and Business Project Recovery Opportunities
Managing a troubled project requires decisive action and clear communication. Whether you choose to rescue or abandon a project, you must base this decision on careful assessment, stakeholder transparency, and strategic goals. Understanding when to make tough choices — and when to invest in recovery plan efforts — will determine the long-term success of your projects.
By following the steps to reassess scope, reset expectations, and reorganize the team, project managers can turn struggling projects around and keep them on track. Effective leadership and a willingness to adapt are key to ensuring project success, even when the road ahead is uncertain.
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