How are mega projects delivered around the world?

If we look across a range of studies, there’s a consensus that around 70% of major projects disappoint their owners.

It’s worth letting that sink in.

This disappointment doesn’t just arise from cost or time overruns. The problem is even more fundamental.

Too many projects simply fail to deliver the outcomes expected by their owners and sponsors.

That was the backdrop to A Systems Approach to Infrastructure Delivery (SAID), a programme of work into improving the delivery of major projects, led by Andrew on behalf of the ICE since 2020.

What’s the key to delivering major projects?

As we’ve developed this work over the last three years, we’ve come back to two key ideas:

Systems, not projects deliver outcomes

Systems thinking, in the broadest sense, offers a route to improving project outcomes.

It’s important that we don’t lose sight of the fact that even the largest megaprojects like HS2 remain a relatively small intervention into an enormous, existing system.

Similarly, major projects themselves are complex systems with sociopolitical elements, as well as technological and commercial ones.

In both cases, it’s vital to identify and actively manage the most important interfaces between the system elements.

Outcomes depend on rapidly evolving technology

The services supported via physical infrastructure – and that ultimately deliver the outcomes – are increasingly dependent on very rapidly evolving technology.

This technology may go for several cycles of becoming obsolete during the delivery phase of a project, and several more during the assets’ operational life.

However, we still set up projects with an overwhelming focus on civil engineering and construction works, storing up problems for operators, and hindering the delivery of the benefits that we set out to achieve.

To move from diagnoses of the problem to possible cures, we’ve also developed eight principles for improving infrastructure delivery.

And, in a second phase of work, we tested them with leaders of live or recently completed projects and programmes.

International perspectives on mega project delivery

Over the first three months of 2023, the ICE has worked with Mark to explore the SAID findings via a series of international roundtables.

We wanted to learn from colleagues around the world and understand more about the challenges of implementing a systems approach to project delivery in different contexts.

Context is clearly important.

Everywhere we went, we heard about exciting, technologically advanced mega-programmes from the Brisbane Olympics to Saudi Arabia’s Neom and The Line.

In each location, political expectations, governance arrangements, and physical geography – all vital parts of the project system – clearly shape what happens on the ground.

Similarly, a region like Hong Kong, with its intensive development stretching back decades, can draw on knowledge and capability that isn’t available to regions looking to scale up activity from a much lower base.

Principles that work worldwide

What was striking, however, was just how widely the SAID analysis resonated across these very different contexts.

Take just one of our eight principles, Shovel Worthy – Not Shovel Ready.

All our colleagues recognised that there’s a vital role for professionals to explain to their sponsors that this isn’t about delay, but rather identifying the optimal moment to begin the construction phase. This in the interest of a faster and more effective end-to-end delivery of outcomes.

We also explored how advances in data availability and analysis are unlocking opportunities in areas like reference class forecasting to establish much more realistic expectations of time, cost, and quality from the early days of a programme.

Our hypothesis that technology is moving centre stage also survived contact with international reality.

Thinking ahead

In just one example, we had a fascinating discussion about the challenges of reimagining health care for an age in which the physical building at the centre of programmes – the traditional hospital – may play a declining role in coming decades for the delivery of health-care services.

At the very least, sponsors and programme leaders must ensure that they aren’t making decisions that close off future opportunities.

In line with the findings of the SAID reports, we may need to start evolving how we think about long-term programmes so that we deliver a minimum viable product, providing a flexible foundation for delivering future expansions of services.

The role of contracts

This discussion about technology overlapped with reflections on how contracts and delivery models need to evolve.

There was broad consensus across regions that traditional contractual relationships can prevent clients gaining enough direct access to a technology partner.

This situation is very unhelpful in a world in which those partners will have a much greater influence on the long-term success of the project than a tier 1 contractor.

Not least because, if the owner doesn’t understand its technology providers’ product development strategy, then they run the risk of critical elements of the system becoming obsolete or unsupportable.

Leadership

Looking ahead, the ICE and Bentley are collaborating to deliver a third phase of the SAID study, looking in detail at the kind of leadership needed to make a success of a systems approach.

One interesting angle on leadership that emerged from the roundtables was a need to think more about the layers of systems leadership.

Policymakers need to be able to use systems thinking to shape infrastructure decisionmaking just as much as sponsors, owners, and the supply chain.

Lastly, and we recognise this may be challenging for the ICE, we also found wide support for the idea that as a sector, we need to be more open-minded about where infrastructure programme leaders come from.

It was clear from the discussions that many of the skills required to lead major projects aren’t directly related to civil engineering or any other technical discipline, such as the ability to engage with multiple government departments and align their aims.

On top of this, the range of disciplines that now need to come together within major projects is much greater than at the start of our careers – and will only grow.

What kind of leadership is needed?

The task of understanding all the details is beyond any one individual.

In this world, we need leaders who can marshal a diverse and often geographically dispersed team, who have self-awareness of their own limitations and the ability to bring the right expertise through at the right time.

As we complete our work on the third phase of SAID, we will be focusing on the development of individuals with these capabilities, regardless of their original academic or professional background.