When a competitor releases a similar product during the final stages of a project, the project manager should escalate the situation to the project sponsor. The project sponsor has the authority to make high-level decisions regarding the project's future, including whether to continue, adapt, or terminate the project. Initiating project closure or change control without consultation could be premature and might not align with the strategic goals of the organization. Addressing risk mitigation alone would not be sufficient without first discussing the impact and potential response with the project sponsor.