Chapter 19: When a project starts going wrong

You can read the red flags without knowing the code

The signals fall into four areas: time, budget, quality, and team. A single amber signal does not yet mean a crisis, but it is a reason to ask the vendor a question. A red one calls for action. Four signals tend to have the most expensive consequences: the vendor refuses access to the code or an audit, you keep hearing “90% done,” you see nothing new to deploy for 4–6 weeks, and the share of the budget spent exceeds the share of scope accepted by more than 15–20 percentage points (an indicative threshold).

Why not wait? Cost overruns grow with every year a project lasts (chapter 18). So respond to a red signal within 2 weeks (rule of thumb), not “when we see how it goes.” It is like the oil warning light in a car: you can keep driving, but the repair gets more expensive with every kilometer.

The escalation ladder: from braking to switching vendors

Respond to a problem according to how serious it is. Each further level of intervention costs more, so start with the first one unless the situation calls for a more drastic step.

Re-planning does not just mean a new deadline. It is a new plan built on the team’s actual velocity, with a smaller scope, checkpoints, and the signatures of both parties. If the team misses the next checkpoint too, do not move the plan again. Move on to the next level of intervention.

An independent audit is cheap insurance against an expensive decision made blind. Commission it from someone with no ties to the vendor and present the result to the steering committee with a clear choice: continue with a smaller scope, or stop. In the digitalization of building permits, the government decided in October 2024 not to develop the existing systems any further and to prepare a new tender Government, October 16, 2024. The forensic audit came only afterward, the legal part in April 2025 DSŘ audit, legal part, 2025 and the technical part in August 2025 DSŘ audit, technical part, 2025, and it served to establish accountability. The better order is the reverse: first the audit, then the decision. Chapter 20 describes how the launch itself turned out.

When to stop a project

Stopping a project is a legitimate decision, not a failure. In January 2025, Miloslav Kala, President of the Supreme Audit Office (NKÚ), said on television about the digitalization of building permits: “Knowing how it ended, it would probably have been better to stop it. But at the moment the decision was being made, it wasn’t that simple.” Aktuálně.cz (ČTK), 2025

The second sentence is the important one. Decisions are hard to make in a crisis: every day has already cost something, the deadline is pressing, and nobody wants to admit the money is lost. So agree on stop criteria in advance, at the start of the project, and write them into the plan or the contract. In a crisis, you then check whether any of them has been met.

STOP CRITERIA FOR THE PROJECT (agreed at the start)
Project: ____        Approved by (sponsor, steering committee), date: ____

We will stop the project, or fundamentally re-plan it, if at least one of the following occurs:
1. ___ weeks without a deployable increment (default suggestion: 6).
2. Budget spending is more than ___ percentage points ahead of the accepted scope (default suggestion: 20).
3. The estimated cost to completion exceeds ___% of the approved budget (fill in yourself).
4. The vendor refuses an independent audit or access to the code.
5. The business case no longer holds (goal, benefit, legislation, management priority).

Who evaluates the criteria and how often: ____
Who decides on stopping: ____
What happens on stopping (handover of code, documentation, access; payments): ____

The default values are indicative. Adjust them to the size of the project.

Switching vendors in the middle of a project

Without the code in your repository, documentation, access, and a license for modifications, a new vendor has to start from scratch, or cannot take over the work at all. So the contract should include stages with the option not to order the next one, an exit plan, and a mandatory duty to cooperate during the handover (chapter 11). Chapter 24 describes the system handover in detail.

Do not forget penalties either. A contractual penalty that you never enforce stops working: the vendor starts treating it as a formality. Enforce it, or justify in writing why not. An excessive penalty does not help either: a court can reduce a disproportionately high contractual penalty (Section 2051 of the Civil Code), so agree on a reasonable one with a cap. Also keep a record of your own delays in cooperation, because they push back the vendor’s deadline.