Well, it might not be a popular decision but I think the middle east needs to be annexed by the western nations. Make sure to give them the most strict separation of church and state that is possible. Theocracy breeds ignorance and terrorism.
But that will only kill big organizations like ISIS. Individual scale Islamic terrorism will always exist, since it isn't really a war, its a personal thing. Someone will always feel lost in life and decide to take out a few infidels so they can have a better afterlife. That's the scary part. For some, they interpret their religion as killing gets an instant ticket to heaven.