Author Bent Flyvbjerg on why so many projects go bad — but yours doesn’t have to
Bent Flyvbjerg knows a thing or two about project inefficiency. As an Oxford University professor and economic geographer, Flyvbjerg studies the role that big projects play in shaping and changing cities — and why so many of those projects run over budget, over time, or simply fail.
Flyvbjerg’s consulted on more than 100 megaprojects (extremely large-scale, complex operations) each costing at least $1 billion. He’s also collected data on more than 16,000 projects across the globe, ranging from a multi-school development in Nepal to The Guggenheim Bilbao Museum. All together, his research paints a bleak picture. Less than 50 percent of megaprojects come in on budget. Only 9 percent come in on budget and on time. And less than 1 percent come in on budget, on time and deliver expected benefits.
In other words: 99.5 percent of big projects fail in one way or another.
In his latest book, How Big Things Get Done, Flyvbjerg and co-author Dan Gardner use those failures, and some rare wins, to construct a blueprint for success. Flyvbjerg recently spoke with Quickbase about what distinguishes triumphs from defeats, even — and especially — as inflation and rising interest rates drive up costs for big projects, the productivity crisis continues and bad outcomes may seem inevitable.
You’ve said that we shouldn’t expect projects to just go bad, but disastrously bad. Why is that?
Projects that cost too much, take too long and fail to deliver benefits are to be expected. But given the size, complexity and novelty of megaprojects, you shouldn’t just expect them to go bad. You should expect quite a large percentage to go disastrously bad: black swan events with extreme blowouts for cost and schedule overruns. Like the Sydney Opera House, which was such a mess that entire sections had to be dynamited and rebuilt. The final tab was 1,400 percent over budget, and a decade late. Japan’s Monju Nuclear Power Plant cost $9 billion, and was decommissioned after working for 250 days into its 22-year lifespan. No benefit at all to show: just costs and delays, and more costs and more delays.
What’s the most common risk you see in big projects?
Project managers tend to think of risks as external. But the main threat to success is humans, and our cognitive biases. That includes optimism. Project managers are overly optimistic about budgets, schedules and even project benefits. They go in clueless about the real odds and end up underperforming on all three counts. And then they do the same thing again with the next project.
It’s important to realize that we all have these types of biases. Then, we need to de-bias. Successful project leaders are always realistic. They have productive, instead of deluded, optimism.
You tell leaders to think slow, but act fast. How so?
Another bias that can crush a project is the urge to jump in and get those shovels in the ground as fast as possible. But planning needs to include experimentation, trial and error, and plenty of iterating.
Planning is doing. It’s a crucial part of many successful projects we’ve studied. Pixar Animation Studios has an established process that includes various iterations of a film, with room and time for experimenting and adjusting along the way. Award-winning architect Frank Gehry is famous for creating hundreds of iterations and digital simulations before arriving at the final design.
Why should we all “find our Lego”?
A block of Lego is a small thing, but with enough of them you can create something much bigger. Every project leader should begin by asking, “What’s our Lego? What’s our small thing we can repeat, repeat, repeat?”
Modularity is the key to megaprojects that tend to succeed. A megaproject in Nepal produced 20,000 schools this way, on budget and years ahead of schedule. It began with designing three classrooms for different conditions. Multiple classrooms became a school. Schools became districts. Districts became a school system.
Solar panels, wind farms, server farms, software, Apple’s headquarters, the Madrid Metro system: all are based on repeat, repeat, repeat.
Looking ahead, will the current economic situation dry up the number of big projects?
Inflation and higher interest rates are making everything harder and more expensive. Some builders hesitate to take on the risk of rising costs. But the project pipeline is not likely to dry up. During a crisis, big projects are used as stimulus.