Why Thresholds are Important for Project Management

Barry Shore had an interesting post on why it's hard to pull the plug on projects. This caused me to think further about the importance of project thresholds. Threshold evaluations of projects shouldn't be continue/end project decisions, they should be places where the steering committee or project leadership team decides if the project should continue on it's current path or if one of the contingency paths should be followed.

What is a Threshold?
When you have a major project, there should be a few threshold gates (2 to 4) where the steering committee or project leadership team evaluates the progress of the project against predetermined metrics. A decision should be made about whether the project should continue on its current path or if it should go on a different path, a contingent path.

Going into a Threshold Meeting
Unfortunately, often threshold meetings are seen as go/no-go evaluations of a project. Really, they should be evaluations of whether the project is on the correct path currently or if one of the contingent paths or even a new path, is the better way to go.

One of these paths may lead to be project being rapidly ended, but that should not be the only alternative. There should be multiple contingency paths so the leadership can evaluate what is the best route, not whether the project should live.

Have you seen situations where companies have done this? What were your experiences?