Recovery Project Management
Developed by Andrzej Stanek
Recovery Project Management – a methodology or a set of tools and guidelines for managing troubled or failing projects. One of the most detailed methods was created by Harold Kerzner and is called UATNRE (from first letters of six stages of project recovery: Understand, Audit, Tradeoffs, Negotiate, Restart and Execute). In his paper about Recovery Project Management (called "Recovery Project Management: Techniques and Tactics For Reversing Failing Projects”) Kerzner describes the importance of understanding troubled projects, he writes about the root causes of project failure and the steps that need to be taken in recovery attempt (like choosing the Recovery Project Manager).
The project recovery starts with the Understanding Phase. At this stage the Recovery Project Manager very carefully analyses the current situation and the project history. Having understood the current situation a recovery project manager can move to Audit Phase. That is the moment where project activities need to be assed against the schedule and the objectives need to verified. Moreover, the root cause analysis needs to be performed in search of both surface and hidden failure points. Each of project deliverables needs to be assigned to one of 4 categories ("must have”, "nice to have”, "can wait” and "not needed”). Next step is the Tradeoff Phase, where the Recovery Project Manager together with the project team prepares the tradeoff options for the meeting with stakeholders. During the Negotiation Phase the decision on the project future (and shape) is taken together with the stakeholders. After that comes the restart phase (if stakeholders decided to continue the project) where the Recovery Project Manager communicates results of the negotiations followed by the Execution Phase in which the project scope is being stabilized and the new plan is realized. 
Method Description and Application
Why Recovery Project Management?
Recovery Project Management is very useful tool when it comes to treating troubled projects as other project management methodologies (like Prince or PMBoK) are very general and focus rather on how to manage the project in the right way than on what to do when because of the mistakes that were made or unfavourable circumstances the project is in danger. Moreover, the research conducted in 2011 in 134 American companies shows that as much as 37% of the projects are projects at risk.
The average value of those projects have been estimated to $74 million (per firm). One third of those projects ($24 million) eventually failed, which perhaps could have been avoided at least in some of them.
The same research also brings the answer to the question about the effectiveness of recovery project management tools: in the companies without the established methodology for recovering troubled projects the percentage of the projects that failed equals to 20% and is significantly higher than in the companies that have the established process (only 6% of projects failed).
Introduction to Recovery Project Management
Recovery Project Management is the methodology for managing troubled projects. It was created by professor Harold Kerzner, PhD - American engineer, retired System Management professor at Baldwin Wallace University, Project Management Executive Director at International Institute for Learning. The method describes 6 phases of getting the project back on the track. Those stages are: 
Those six life cycle phases are divided into two groups, as it is shown in the Figure 1.:
- Evaluation phases (first 4 included)
- Recovery phases (last 2 phases)
Kerzner in his article puts an emphasis on the fact that no matter how good the method is, it is impossible to reverse all of the failing projects. Moreover, he underlines that project does not go from green to red overnight – there are many early warning sign but the reason for numerous projects being at risk is the fact that companies cannot read those signs.
Most common project failure causes
According to PM Solutions five most common causes of the troubled projects are:
- "Requirements: Unclear, lack of agreement, lack of priority, contradictory, ambiguous, imprecise.
- Resources: Lack of resources, resource conflicts, turnover of key resources, poor planning.
- Schedules: Too tight, unrealistic, overly optimistic.
- Planning: Based on insufficient data, missing items, insufficient details, poor estimates.
- Risks: Unidentified or assumed, not managed."
Recovery Project Manager
Before a company can start project recovery a Recovery Project Manager needs to be chosen. According to Kerzner not every project manager can successfully manage troubled projects as in project recovery apart from project management knowledge additional skills are required:
- "Strong political courage and political savvy
- A willingness to be totally honest when attacking and reporting the critical issues
- Tenacity to succeed even if it requires a change in resources
- An understanding that effective recovery is based upon information, not emotions."
Understanding is the first of evaluation phases and the first phase in the whole Recovery Project Management process. It includes general and in-depth analysis of the current situation (as well as the project history) by newly assigned Recovery Project Manager. The analysis should include review of the business case, project objectives and benefits as well as the project assumptions. Furthermore, the stakeholders of the project need to be analysed in terms of their expectations and sensitivity and the enterprise environmental factors should be revised if needed.
Moreover, Kerzner defines 4 questions that Recovery Project Manager needs to ask at this stage:
- "What authority will you have to access proprietary or confidential information? This includes information that may not have been available to your predecessor, such as contractual agreements and actual salaries.
- What support will you be given from the sponsor and the stakeholders? Are there any indications that they will accept less than optimal performance and a descoping of the original requirements?
- Will you be allowed to interview the team members in confidence?
- Will the stakeholders overreact to brutally honest findings even if the problems were caused by the stakeholders and governance groups?"
Audit phase is crucial part of Recovery Project Management. After the previous stage the Recovery Project Manager should already have the knowledge about the project and be able to evaluate this information in the second phase.
At the beginning all the project activities need to be assessed against the schedule in order to determine whether they are delayed or not and if the answer is yes – how substantial the delay is.
Another important aspect of the audit phase is the root cause analysis. It will be used to identify failure points. It is of high importance to find not only the surface failure points but also hidden ones (it will help to put the project back on the right track).
Next step that needs to be taken is assigning project each project activity to one of 4 categories on the basis of its high or low strategic importance and added/rework cost:
- "Must have”
- "Nice to have”
- "Can wait”
- "Not needed”
In the Figure 2. we can see how the categories are divided.
At this point review of the issue log would bring the answer if the issues were mostly people issues and therefore if some people need to be replaced.
Kerzner underlines that the project recovery cannot be done in isolation therefore Recovery Project Manager needs to have strong support from both: the executive team and the project team.
Executive support is strongly related to the value that the project represents to the company. To determine the value the following questions need to be considered:
- "Is the project still of value to the client?
- Is the project still aligned to your company’s corporate objectives and strategy?
- Is your company still committed to the project?
- Are the stakeholders still committed?
- Is there overall motivation for rescue?"
One of the first things that needs to be done is the interview with each of the team members. It will have multiple functions:
- it will have positive impact on their support of project recovery,
- it will help to involve them if they are asked about their viewpoint on what were the causes of project problems
- and it may be helpful in identifying the human-error-driven problems.
As obtaining the support of the project team is key success factor in the project recovery apart from interview with the members also other action should be taken like involving full team at every stage analysing their work culture and helping them to re-establish work-life balance.
After completing two previous stages the Recovery Project Manager should already have gathered all the information, analysed and understood all the causes of past problems and have established cooperation with project team ensuring full support from them.
Next step is the Tradeoff Phase and determining tradeoff options to be presented to stakeholders. This step is necessary as it is very unlikely that the project run into serious trouble and initial requirements can still be met within given time and cost.
Kerzner in his article puts an emphasis on the fact of probable switch of triple constraints that are primary for the stakeholders of the troubled project from time, cost and scope to value, quality and reputation (see Figure 3.) as at this stage stakeholders should be aware that initial plan in terms of cost and time either is or will be violated.
In the Audit Phase the Recovery Project Manager assigned each of the remaining project activities to one of the four categories in terms of strategic importance and added/rework cost. On the basis of this classification the team needs to determine which of those activities can still be completed and which of those cannot. Also the consideration about which problems should be solved first would be required. As the results the team will see clearly in which project areas the biggest compromise with the stakeholders will be required.
Having all the knowledge the Recovery Project Manager should at this point decide whether the project is worth saving. If there is no valid business justification for continuing the project the manager need to have courage to communicate such opinion to stakeholders during the negotiations stage.
Negotiation Phase is the last stage of Evaluation Part of the Recovery Project Management process. During negotiations with the manger presents the results of the efforts of the team from three previous phases with the tradeoff options on top of it. It is of high importance to identify what items are most important for the stakeholders, to prioritize tradeoffs as well as ensuring the executive support and the sponsorship for the project if presented solution was accepted and the decision to continue the project has been taken.
At this stage the clear communication of current situation and presenting solutions that are realistic is crucial to avoid repeating the scenario of project getting off the track.
Restart phase is one of two recovery phases (previous four were Evaluation Phases). It should always start with communicating to all members of the project team what plan have been established with the stakeholders and how the negotiations looked like.
It is also the right time to discuss once again the mistakes made throughout the project and ensure they will not be repeated. If any roles of the team members should be switched or the scope of one’s activities changed it is also an adequate moment to take such a decision. Any changes to the style of managing the project should as well be communicated to the project team.
Keeping the project sponsor and key stakeholders engaged will help to get the right support and thus have greater control of the project.
Execution Phase is the last stage of the whole process. At this point the results of all of the previous efforts are being implemented into the real life. It is of the highest importance that Recovery Project Manager remembering the past mistakes does not enable them to happen again. Controlling the scope of the project, especially controlling that the project scope would not be changed (after implementing changes established with the stakeholders during the negotiations) is crucial.
Throughout the remaining part of the project ensuring the positive atmosphere in the project team and providing clear and effective communication are as always important.
Although the method presented by Kerzner seems to be effective, it has a certain number of limitations. First of all, the area in which we can use the method is limited to the specific environment of the troubled projects. Even though it is limited to project at risk it does not guarantee the success of the project recovery as Kerzner clearly states that not all of the projects can be saved - there are projects that will eventually fail despite all the recovery efforts.
Moreover, the success of the method strongly depends on the environment, not only to the performance of the user of the method – whether the project would be saved or not highly depends on the stakeholders’ approach and the level of engagement from project sponsors and executives.
Also high requirements regarding the competencies of Recovery Project Manager combined with the suggestion that it should be a person chosen within the company (not from the outside) might be problematic. Not in every company there is a person with sufficient project management knowledge, very high level of interpersonal skill and strong personality that would be immediately available to take care of the project recovery full-time.
Last but not least, it can be stated that the method cures the symptoms rather than causes. The benefit for the company is single-time (in the form of saved project) and it does not bring any long-term value. The companies should rather avoid mistakes that lead to the situation in which a project has to be recovered, than treat Recovery Project Management as the alternative way of managing a project.
So far the method created by Harold Kerzner is the most detailed and there are not many alternative approaches, what suggest that recovery project management is not as popular as it should be given the results of the research showing that 37% of the projects are troubled projects.
On the PM Perspectives blog an article by Nadine Rochester called "Failing Projects: Five Steps to Rapid Recovery” can be treated as an alternative approach to what Kerzner created, however it is rather general. In the article she gives a guideline on how to deal with projects at risk in 5 steps:
- Defining the charter
- Developing the Assessment Plan
- Conducting the Assessment
- Developing the Recovery Plan
- Conducting the Recovery
In the first step the authority of managing the project is transferred to Recovery Project Manager, his roles and responsibilities are defined with the project sponsor. In the "Developing the Assessment Plan” phase a Recovery and Assessment Team creates the assessment plan on the basis of Rapid Assessment Model. In the next stage of process, the assessment is conducted on the basis of the plan from the previous stage, with meetings and interviews being a key part of the assessment. In the fourth step, which is Developing the Recovery Plan the author of the article advises to plan all the following actions in very small parts that she named "inchstones” (in opposite to milestones). Last step is the execution of the recovery. Crucial to the successful ending of the project would be to carefully monitor and analyse the execution of the milestones. 
I believe that Harald Kerzner created a guideline that in 6 clear steps shows the company and the Recovery Project Manager how to do everything that is possible to save the project.
To some extent the method should be called innovative as it is first scientific literature on the specific topic of project recovery in which a step-by-step method to solve the problem is proposed.
In my opinion Recovery Project Management is a great tool when the mistake (or the series of mistakes) has already been made and we need to reverse the failing project and end the project with a success. But not only. The method is also meant to ensure taking the right decision on whether to continue (when after the analysis there are realistic chances of successful project completion) or drop the project (when the analysis gives the clear indication that there is no possibility of putting the project back on the right track).
Nevertheless, we should always remember that even the best "emergency” symptoms-curing method cannot replace the everyday conscientiousness in efforts towards avoiding mistakes that put the projects at risk.
- Kerzner, Harald, Recovery Project Management: Techniques and Tactics For Reversing Failing Projects, International Institute for Learning, 2010
This is the article in which Kerzner method was first published. It contains all the details and author’s advises.
- Strategies for Project Recovery A PM SOLUTIONS RESEARCH REPORT, Project Management Solutions, 2011
In the research report by PM Solutions a lot of interesting statistics on topic of project at risk as well as the causes of project failure can be found.
- Rochester, Nadine, Failing Projects: Five Steps to Rapid Recovery, PM Perspectives Blog, 2015
The article by Nadine Rochester is the alternative approach to method created by Kerzner. In the article more information on the method briefly described in "Alternatives” section can be found.
- ↑ 1.0 1.1 1.2 1.3 1.4 1.5 1.6 1.7 1.8 1.9 Kerzner, Harald, Recovery Project Management: Techniques and Tactics For Reversing Failing Projects, International Institute for Learning, 2010
- ↑ 2.0 2.1 2.2 Strategies for Project Recovery A PM SOLUTIONS RESEARCH REPORT, Project Management Solutions, 2011
- ↑ Jarocka, Karolina, Projekt nad przepaścią. Plan Naprawy Projektu z wykorzystaniem metody UATRNE, Strefa PMI 13/2016
- ↑ Rochester, Nadine, Failing Projects: Five Steps to Rapid Recovery, PM Perspectives Blog, 2015