Project Benefit Realisation and Project Management. Raymond C. Young

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      Are We Talking About Strategy or Policy?

      Having extensively discussed the role of strategy for projects, we should mention the important role that policy plays in project execution. Some projects are simply there to enact or enforce a particular public policy. Like the previous argument about the failure of the strategy to achieve business objectives through projects, the situation with policy is no different. This is where megaprojects and infrastructure can teach us a lesson. Generally, the larger and more complex a project becomes, the fuzzier will be its front‐end and the less likely that the goals will be met.

      Only think about the pilot project of introducing the universal credit system in the UK. This much‐awaited incentive has been planned for years to simplify the system of benefits in the UK. Effectively, the new Universal Credit System was to replace six separate income‐related benefits and has been piloted since 2013. Nonetheless, the rollout of the system has been facing numerous delays and controversy due to the high complexity and interdependency of the elements that the project is supposed to integrate. As a result, the policy implementation as the main goal of the project has also been hampered.

      Clearly, a policy is key to the existence and implementation of such an extensive programme. The other example is the famously failed NHS IT programme that existed between 2005 and 2013 until it was suspended. In that time, the costs skyrocketed from the original estimate of £2.3B to, according to some estimates, around £20B.

      Over the last several decades, London has been home to a number of ground‐breaking projects which are seen as game‐changers for urban planning and policy. Take the example of the east London regeneration plan that was one of the original aims for the London Olympics 2012. One of the programmes was the East London line which contributed to the regeneration of an otherwise deprived area. Its purpose was to improve connectivity for other benefits to happen: job creation, housing, and economic growth.

The other example is Crossrail, a high‐speed underground system connecting London’s West with the East. The drive was the increasing unaffordability of housing and enabling better connectivity to central London which is home to most businesses. The argument went that if people are better able to travel from suburban zones to Central London, it would have contributed to the productivity of the service sectors (e.g. finance) located in central London areas. Whilst Crossrail similarly faces a number of issues including a delay and budget overrun, any large‐scale infrastructure project creates a large number of externalities, both positive and negative, and that those are hard to pinpoint at the front end. The other thing is that those projects are often delivered in the form of megaprojects that are more expensive than £1B. This means that for some of those projects, they can take up substantial chunks of the national GDP. However, as they get bigger, the literature teaches us that they get more fragile and they fail more easily. They are also more difficult to stop once they turn pear‐shaped.

      There is an entire stream of work on such megaprojects and they are increasingly becoming an area of not only scholarly inquiry but also of governance and management expertise. Studies looking at the success of those projects suggest none have succeeded. In other words, virtually all large‐scale infrastructure projects fail to deliver on their expectations [25]. This is arguably because of the interests of planners, engineers, and politicians to move their pet projects rather than ones that are going to bring about real benefits. This leads to projects getting approved – but the ones which look best on paper, not in reality. And they can only look best on paper if someone either ‘strategically misrepresented’ them or was optimistically biased [26]. The result is that we have the worst projects and the ‘survival of the unfittest’. They are chosen based on the agenda that politicians want to get re‐elected, they want to be seen as the facilitators of those projects with vast social impact. The Heathrow Airport T5 opening back in 2008 was a good example. Whilst the project was and still is widely considered a success, its chaotic opening made the headlines of the press worldwide. To draw a line under the argument, our stance here would not be as pessimistic. We do not agree that it is the worst projects that get built (indeed there is no evidence for that) but that random infrastructure projects get built at best. However, through their governance structures and a set of local and historical circumstances, they can evolve through time and become something very different from what they were envisioned to be.

So, what is the lesson to be learned for executives here looking at infrastructure and megaprojects? We surely are not trying to teach you here how to govern a £1B+ beast, but we do want you to learn from the experience of trying to tame such beasts. There are a few things we can induce here. It is that projects are more fragile, the more they grow and more complex they become [27]. The second thing is that they evolve with time. The third point is that no matter how hard you try to nail down the specs, it will change. The fourth point is that the project will not only have its immediate benefits but there will be wider externalities that are captured beyond the boundary of the projects. So, what is the solution learning from infrastructure implementation programmes? The short answer is a lot. Most importantly, it allows us to say that governance structures can be designed upfront. We can design our projects by looking at the organisation that delivers them and their alignment between the strategy, policy, and operations.

      Design Thinking for Project Governance

      The final key concept we want to touch on briefly is design thinking. We believe the role of the accidental project sponsor is as a reflective practitioner [28] or a painter who engages with the canvas in a reflective conversation and by so doing, creates something that has not existed before – the artificial [29]. In this sense, the argument of this book will be based on the idea that projects are designed in an interactive and stepwise manner rather than implemented based on a pre‐existing plan. In our experience, we have seen many a project being implemented for no real strategic purpose in terms of benefits realisation. This was always wrong, and it will be even more wrong in the post‐2020 pandemic world of projects where investments in any capacity upgrades, assets, or product developments are likely to be scrutinised even more. It is much more likely that there will be more effort in the front end of the project where strategic decisions are made to decide about which project to sanction and equally to set up its governance and organisational structure. For this reason, it is likely that we will need more flexibility and agility in the project development process and that we will have portfolios comprising larger numbers of smaller projects brought together in a modular fashion.

      There are two main theoretical points we would like to drive home here. And that is that (i) projects are designed as solutions to policy or business problems. And that (ii) these problems are only seldom straightforward and well‐structured. More often than not, they would be what we call ‘wicked’ [30]. Wicked not in the sense of evil and morally wrong but wicked in the sense of playfully mischievous. The term ‘wicked problem’ was originally coined in the context of town planning but was then expanded to include all sorts of political, economic, and social problem‐solving. Some of the most obvious differences between tame and wicked problems are that the former are describable and determinate, whilst in the latter, problem definition incorporates solution and only indeterminate solutions can be achieved. Design, on the other hand, can be seen as a combination of framing and problem‐solving [31] and so can be project management [32].

      This book will draw on the main principles of design and design thinking and apply them to the context of projects as they are likely to be needed rather than the traditional top‐down mindset focused on on‐time and to budget. The main premise is that we think of projects as solutions to problems that need to be designed rather than taken for granted as is sometimes the case.

References

      1 1 Hilmer, F.G. (1993). Strictly Boardroom: Improving Governance to Enhance Company Performance. Melbourne: The Business Library.

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