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Too Big To Succeed?

Too Big to Succeed?

Quality, Consequences and the Construction Industrial Complex (part 61) – All IMHO:

I think there is one common theme or inconvenient truth, emerging from the mega projects, it is they are just too big to succeed!

,What do I mean by this? Lets start with some definitions:

Succeed means designed, constructed and commissioned on schedule and budget to full operation with few defects. 

Mega projects are “super tall buildings*” (over 300m in height), large hospitals (over 1m sq.ft.)  and large multi building developments. Development projects with Capex of $1 billion or more.

The mega phenomenon is growing. There has been an accelerating trend to mega projects over the last 10 years. Think urban regeneration for the olympics, P3 mega hospitals and skyscrapers. 5 years ago there were 50 “super tall buildings” today there are 100* with more in the pipeline. 

I have visited several mega projects recently and worked on many in the last 15 years and most are:

  • Late
  • Over budget
  • Poor quality
  • Populated by burned out people

Mega projects have some unique pressures due to their sheer scale, ambition and hubris. They are very public, very high risk due to the level of funding required and tied up with political and business reputations which always necessitates a “face saving” PR exercise at the end.

There is even a phenomenon called the “skyscraper curse”. In some investing circles the building of a “worlds tallest” or “worlds largest” development is considered a leading indicator of economic downturn. The current “worlds tallest” building is under construction in Jeddah KSA. It was conceived when oil was over $100 a barrel and will be delivered into an economic crisis in KSA. 

How do mega projects impact the markets they reside in? They:

  • create jobs but they really create job and skills shortages;
  • overwhelm the normal capacity of the building design and construction firms;
  • SME’s take on work they cannot deliver which increases project risks;
  • contractors and people are fired for poor performance mid project;
  • people are given jobs beyond their abilities;
  • outsiders, firms and people are imported who do not know the local market.

Anecdotally I have seen this recently on a large mega project that has been delivered in a “face saving” way and is now being completely recommissioned and fixed with the building occupied . Another mega project has a new Commissioning Manager each time I visit as the previous one resigned because he could not get the Project Manger to understand the coordination issues regarding building services. When good people foresee reputational or personal financial risks they leave. In reality, people leave people and bad projects, not companies. 

What can be done? The only answer is to acknowledge the sheer project size then manage aggressively the risks and complexity with mitigation strategies such as:

  • Phase completion as much as possible.
  • Split risk between multiple design and construction firms. The “bulk discount” concept in construction is a myth.
  • Design with scarcity of skills, materials and resources in mind. Keep it simple!
  • Minimise complexity and interconnections between buildings and systems. 
  • Put a lot of emphasis on design details.
  • Hire project managers that understand the complexity of buildings, do not have a “concrete farmer” as project manager. 
  • Plan early and in detail. 
  • Hire the best. Mega projects attract high performers, however high performers do not put up with unrealistic goals or poor leadership. 

So to answer the question I would say yes, some projects are too big to succeed as they overwhelm the people that work on them and the local markets they reside in. Going into a mega project, developers, designers and contractors should acknowledge the unique pressure it will generate and mitigate risks as much as possible.

Definition Source: “*Super Tall Buildings” (defined by the Council on Tall Buildings and Urban Habitat as over 300m in height)
Source: *Council on Tall Buildings and Urban Habitat

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