Megaprojects
The tendency for large infrastructure projects to suffer from cost overruns and delays due to overly optimistic assumptions and lack of transparency, as documented by Bent Flyvbjerg.
THE IDEA
Megaprojects
The book ‘Megaprojects and Risk’ by Bent Flyvbjerg 21 describes of how several large infrastructure projects went off track. Flyvbjerg argues that project proposals can go wrong because:
‘[they] assume, or pretend to assume, that … projects exist in a predictable Newtonian world of cause and effect where things go according to plan’.
He argues that various improvements will be needed to overcome recurring issues in the future, including greater transparency, more robust performance specifications, better accountability enforcement and regulatory changes.
When to use it
Planning a new transportation infrastructure project such as a highway or railway.
Launching a major software development initiative with multiple stakeholders.
Undertaking a large-scale construction project like a stadium or airport.
Managing a corporate merger or acquisition that involves significant integration efforts.
FROM THEORY TO EVERYDAY LIFE
In practice
Sydney Opera House
Originally estimated at $7 million and scheduled to take 4 years, the Opera House was completed 10 years late at a cost of $102 million, a total cost exceeding 1,400% of the initial estimate.
Boston's Big Dig
The Central Artery/Tunnel project in Boston was initially budgeted at $2.8 billion but ended up costing over $14.6 billion, with numerous delays and technical problems.
A MOMENT TO REFLECT
Put it to work.
Think of a large project you have been involved in or have observed. Were the initial cost and time estimates accurate? What factors contributed to any deviations?
How can the principles of transparency and accountability be applied to avoid megaproject failures in your own work or organization?
What cognitive biases (e.g., optimism bias, planning fallacy) might lead to underestimating the risks and costs of large projects?
References
- Megaprojects and Risk — Bent Flyvbjerg
CONTINUE THE CONVERSATION
Source texts
- Beyond the Five Whys Root Cause Analysis and Systems Thinking (James C. Paterson)