Big projects have a miserable track record, but they are essential to economic growth and business success. A new book offers ways to improve their delivery.
Why do so many big projects, such as the California High Speed Rail or HS2 in England, go massively over cost, run decades overdue and become political footballs? The statistics are staggering: 99.5% are over budget, over schedule, under-deliver on benefits, or some combination of these. What can we do about it? In How Big Things Get Done, Bent Flyvbjerg and Dan Gardner suggest some answers. Flyvbjerg, a professor at Oxford and Copenhagen, provides the academic rigor, while Gardner, a journalist and bestselling author, has made this book a page turner.
A big project, they write, is one that is crucial to you. That could include refurbishing your house – though the cases analyzed here are generally massive infrastructure projects. A big cause of problems is that politicians, planners and contractors conspire to underestimate costs, underestimate delivery times and exaggerate benefits. Their calculation is that once enough money has been spent, a project becomes ‘too big to fail’. When it comes to personal projects, this issue is replaced by a lack of rigor in thinking things through.
Some recommendations are specific to mega-projects. One is to tap into the value of building using modular units (such as farms of solar panels) rather
than ‘one big thing’ (bespoke nuclear power stations). Modular units offer economies of scale, the ability to learn and perfect the approach, and the possibility of generating income as the project progresses, since they come on-stream much earlier. Flyvbjerg and Gardner also champion the rigorous use of statistical analysis to budget better and manage risk.
Some of their lessons are widely applicable. First, define the outcome you wish to achieve and don’t lose sight of it. If you want more bedrooms for your children, a home extension might be the solution – but account for project costs and disruption and you might find it would be better to move house.
Second, the longer a project takes to execute, the bigger the chance of it being disrupted by external factors. For example, Covid-19 affected almost every project, but its impact was far less on projects that were in the planning stage. So, be generous in allocating time and effort to planning, budgeting, testing alternatives and mitigating risks – but aim to execute as quickly as possible to reduce the window of unforeseeable risk. This is the opposite of what usually happens.
Third, don’t focus on what is unique about your project, but what it has in common with similar projects. Counter-intuitively, a budget based on the average cost and overrun for similar projects is more reliable than detailed costing based on your individual case.
Flyvbjerg and Gardner emphasize the importance of knowledge and experience. That might be embedded in a project team that has worked on similar projects before, and that knows and respects each other’s strengths. Or it could lie in objects: standardized, widely-used components have years of testing, refinement and skill embedded within them. Avoid unique, untested solutions. Employ people who have done it before. An experienced leader is crucial.
The authors’ rules of thumb are quite simple, and most are relatively straightforward to apply. But they are not a magic bullet. In the near future, we will need to execute an unprecedented number of large-scale projects, not least to achieve net zero.
It really matters that we get better at running big projects.
Piers Cain is a management consultant.
