Enforcing strategic fit of project portfolios by project termination: An empirical study on senior management involvement

Project portfolios are vehicles for strategy implementation. Senior management should terminate projects no longer conforming to corporate strategy in order to ensure strategic fit. This paper investigates how rigorous termination of bad and troubled projects affects portfolio effectiveness and senior management's decisive role in this context. We introduce the concept of project termination quality, analyse its consequences for strategic fit and how it is affected by senior management involvement. Using a quantitative longitudinal study of a sample of project portfolios, we show that termination quality positively affects strategic fit. We also show a positive, but inverted u-shaped relationship between senior management involvement and termination quality. We conclude that there is an optimal degree of involvement, beyond which an additional involvement of senior managers results in negative effects.

► We analyse the impact of senior management involvement on project portfolio success. ► We research adequate degree of SMI in terms of project termination. ► Project termination quality is dimension of process execution in portfolio-management. ► A positive, but inverted u-shaped relationship between SMI and PTQ is shown. ► Beyond an optimal involvement level, action of senior managers shows negative effects.