Best Practices for Managing a Shut Down
May 11 2012
If you are in business or projects for more than a few years, it is inevitable you are involved in an unfortunate event when a major business line, product, service, or project is shut down. These events are never fun and are most challenging to management. Team members are disappointed with the ending, they are uncomfortable with ambiguity, and they are unenthusiastic to continue their jobs and work on the shut down. Management must take great care to take care of customers, employees, and other stakeholders. Following are a few best practices to consider to effectively terminate operations.
- Control the message – It is imperative news does not leak early. When the news is delivered, management must be candid and straight-forward. The news should be delivered as if ripping off a Band-Aid – fast and complete.
- Establish the appropriate strategy – Before shut down is announced and initiated, management must determine the urgency and pace of the shut down. What value is derived from continued operations? What are financial, legal, and regulatory factors in immediately ceasing versus slowly ramping down operations?
- Take care of the team – Obviously, it is best if everyone keeps their jobs. If that is not possible, assure team members understand their options. Monitor and boost morale during the shut down period. Offer appreciation and compliments freely to assure the team remains engaged.
- Have a plan – Treat the shut-down like any other project, with a sponsor and project manager, charter, project plan, and schedule. Assure team members and partners involved in the shut-down understand their responsibilities and follow the plan.
- Clearly define Conditions of Satisfaction and Exit Criteria – Understanding and enforcing what must be done to complete the shut down project is critical. There will be no Phase Two and no clean-up enhancements. Keep team members and managers on board and fully engaged until they are no longer needed.
- Don’t let shut down drag on – This is one project that cannot suffer delays. The team will be ready to move onto what is next and will lose interest if “next” is delayed. Let individual team members move to new roles as quickly as possible. Boredom, mixed with uncertainty, will energize the rumor mill and poison morale.
- Take care of the customer – Obviously, customer satisfaction is a key success factor. Whatever your product or service, minimize impact in the end-user.
- Consider the rules of your game – In many cases, there is need to involve attorneys, contract experts, and compliance advisors. Follow policies and procedures. Research and comply with applicable regulatory requirements. Assure contracts are followed and terminated appropriately.
- Retain important knowledge – In most cases, some semblance of the business or project will carry on following shut down. Products must continue to be supported and all business requirements do not entirely vanish. Often, products or projects are put on hiatus, with the possibility of revival within months or years.
- Transition critical knowledge – When any part of the business or project survives, it is vital those with new responsibilities have the opportunity to “pick the minds” of the outgoing experts. Knowledge retention and transition are so essential, the topics will be addressed in subsequent blog.
- Over communicate – When uncertainty and ambiguity rule the day, management should assure all parties receive as much information as possible. Give team members the tools and knowledge needed to effectively perform their jobs. Let executives, stakeholders, and customers know what changes are planned and executed.
Shut down events are rarely a pleasant event for management or the team. However, effective management and communication can improve opportunity for success.