The Oxford Handbook of Mega Project Management

The Oxford Handbook of Mega Project Management states that its ambition is to ‘become the ultimate source for state-of-the-art scholarship in the emerging field of project management’ (p.1). It was designed to ‘provide the most important contemporary readings’ (p.1). These are lofty goals in a field which the book identifies as being highly fragmented and multidisciplinary. The introduction to the book goes on to restate the editor’s well established research, and demonstrates that the mega project business is expanding, and the evidence on management is that performance is generally poor. Thus the book commences by presenting the mega project paradox which is that on the one hand mega projects are becoming larger and more frequent, while on the other hand management of them has been poor, and is not improving. Mega projects are thus presented as ‘here to stay’, and the following chapters (with three exceptions) essentially wrestle with questions of why they remain unmanageable, and ideas that might be used to improve management performance. The question of whether mega projects should be allowed to continue to become larger and more frequent is glaringly avoided.

With these goals in mind the book approaches the field in multiple ways and is divided into four parts: Challenges; Causes; Cures and Cases. Perhaps these four c’s are an allusion to the six c’s which define mega projects as Colossal in scope, Captivating, Costly, Controversial, Complex, with Control issues (Trapenberg Frick, 2008). There are in total 25 chapters each of which stands alone in line with the idea of presenting ‘the most important contemporary readings’. It would therefore be reasonable to present this review by summarising each chapter in turn, but for reasons of space I will refrain. Instead I will attempt to craft a narrative that re-orders the challenges, causes, cures and cases identified in the various separate sections using each challenge (or in one case a cause) in the order in which they are presented in part 1 (and 2).

The first set of challenges presented relates to uncertainty and the failure to manage it due to consistent underestimation, failure to deal with stakeholders (a major source of uncertainty) and inflexibility in contract management. Lenfle and Loch (Ch 2) look at two historical projects, Apollo and Polaris. They conclude that the success of these projects was due to the creation of specialised units within the organisations (for example the Navy in the case of Polaris) hosting the projects that could experiment with many different approaches concurrently, and testing them in parallel. The authors suggest that this kind of approach, which is governed by an understanding that there is a great deal of uncertainty in such projects, has been destroyed by the PERT/Critical Path Management (CPM) method of project management, or what they call the ‘phased logic, stage-gate approach’. This is because PERT/CPM is based on scheduling out a step-by-step progression wherein the project develops along a single pathway, which is presumed to be determinable before the project begins. Davies et al (Ch 14) present an alternative project management model, which looks surprisingly like the kind of approaches described by Lenfle and Loch, and which they call a dynamic capabilities model. In this model different approaches to deliver the project are tested and combined to address uncertainty. Team structures, which can test and trial ideas are allowed for, and there is a deliberative process during project delivery to leverage innovation through trade-offs. Davies et al, review three more recent projects (Heathrow’s Terminal 5, the 2012 Olympics and Crossrail), all of which they find used a dynamic capabilities model to one extent or another, which they find allowed sufficient flexibility in the delivery model to manage uncertainty. Chapter 14 is perhaps the best written chapter in the book. It is a masterful paper written to provide a clear description of the dynamic capabilities and a review of the literature, leaving the reader able to access the literature on which it is based. These ideas about the need for strategic understandings of innovation and managing for it are supported by Holzmann et al’s (Ch20) study of innovation in the case of Boeing’s 787. The case demonstrates the value of hindsight and that a greater appreciation of how innovative the 787 actually was might well have prevented much of the significant time and budget overrun that that project incurred. Their evaluation of the case is that if Boeing had realised the degree of innovation required in the project (that this was not just another aeroplane) then they would have followed a quite different management approach.

The second set of challenges relates to the attraction of mega projects, and the way that they unfold across jurisdictions. Siemiatycki (Ch 3) presents the cycles in the roll out of mega projects in reaction to innovation, policy mobility and technology diffusion, as an S curved graph. Over time the number of a new type of mega project (for example tramways, public housing, iconic museums) constructed in cities around the world changes at a rate which is ‘emerging’ at the early stage, and progresses through ‘surging’ (in the exponential growth part of the graph) and ‘purging’ where the number of projects tapers off. New innovations are attractive because they purport to solve some understood problem, they are taken up slowly at first, but will surge in response to an identified ‘success’. Decline can come because of saturation or usurping of the technology with something new, or because the ‘benefits’ of the original become increasingly questioned and shown not to be as ‘real’ as imagined originally. This theme is taken up in Cerro Santamaria’s investigation of iconic urban mega projects (Ch 22). That chapter concludes that the effect of Bilbao’s museum on the economy of Bilbao is probably over estimated and due mostly to context, and further that the Bilbao effect has primarily been in the form of global effects in the creation of more museums by cities hoping to capture similar benefits.

The concept of fragility (and that fragility increases with ‘bigness’) introduced in Chapter 4 is similarly related to uncertainty. Ansar et al (Ch 4) suggest that ‘bigness’ can be measured across multiple dimensions; physical size; cost; input; output; and the complexity of technology, users, and impacts. They theorise that fragility (the propensity to break and have trouble returning to the same state) goes up where projects get bigger across any of these dimensions. The chapter suggests that fragility in projects gets exposed when bigness is imposed on situations where scalable approaches could be applied. This is particularly relevant to the question of investment, suggesting that big is not always better, and that being able to scale down and take a flexible approach as to the delivery of outcomes is an unaccounted objective in many mega projects.

Next is the issue of complexity, which is situated largely with the difficulties of integrating various institutions so that projects can be managed effectively. Levitt and Scott (Ch 5) point out that the primary difference between a large project and a mega project is that mega projects have vertical interdependences (the need to create interoperability between various parts of the project which are often governed by different institutions) rather than simply horizontal ones (where segments of the project can be broken up amongst different deliverers). They suggest that solutions to the need to integrate various institutions in a mega project can be found in governance arrangements that try and create a significant stake in the projects by all parties, or set up a framework of alliance contracts or create a shared vision. They suggest this can be supported by partnering and co-location of participants, and including team building exercises, ensuring procedural justice, and building a strong project culture. Winch (Ch 15) takes up these issues of stakeholder management as one of the things that is complex in mega projects. Despite being located in the part of the book about ‘cures’ this chapter is primarily about the difficulties of stakeholder management and how poorly defined the concept is. This concept has variously been expanded to mean virtually everything (including the planet as the primordial stakeholder, and the future) – “those affected by the project” (p.355), and alternatively to mean stockholders – “those interested in the project” (p.355). These findings are strongly supported by Davies (Ch 21) who discusses the structure of organisation for the London 2012 Olympics. The chapter shows how creating a dual management system, where client/delivery partners have split roles, allowed effective stakeholder management. In this project the client acted as the external political stakeholder (outwards) and the delivery partner acted as the contractor manager and coordinator (inwards and downwards). Importantly this case also suggests this coordination was achieved only at a considerable cost. He estimates that 10% of the budget was spent just for integration coordination.

As might be expected of a chapter by Van Wee and Priemus (Ch 6) the next issue tackles the ethics of transport mega projects and tends to find its way into a discussion about the extent to which benefit-cost analysis (BCA) is ethical, or deals with ethical issues (such as distribution effects). In line with previous research by these authors, they suggest that the solution is to ensure adequate analysis of alternatives is taken up. Vickerman (Ch 17) expands on the issue of whether and how BCA can adequately deal with distribution effects, and tries to determine whether taking a wider set of benefits and costs is needed to improve BCA as a decision making tool. After a detailed discussion the conclusion seems to be that in some cases wider benefits should be considered in the transport project BCA, but that they are very difficult to predict because they depend at least partly on political choices and the way projects end up being used. Coming at the problem from a different angle, Holst Volden and Samest (Ch 18) provide an example of a process which can better deal with assuring the quality of BCA that is currently used in Norway, and which seems to be leading to a better selection of alternatives against which projects might be measured.

In this book, most of the causes (Part 2) are considered to be due to human behaviour which can be observed in a number of ways. Flyvbjerg (Ch 8) debunks a theory about whether cost underestimation is really a serious problem. He takes on Albert Hirschman and his ‘hiding hand theory’, which suggests that cost underestimation is a good thing because it allows projects to be built which would not otherwise have been approved due to high cost, but which later ‘benefits’ will demonstrate were worth doing. Flyvbjerg finds that the hiding hand theory holds true neither in the sense that the hiding hand masks under-estimates of costs and also benefits, nor in the sense that it reduces risk over time. Tested against his growing database of mega projects, Flyvbjerg finds that the presence of optimism bias is alive and well in mega project management. Writing this review reminded me how deeply disturbing I found this chapter. Throughout I found myself much like Hirschman looking for some good outcomes from mega projects, even though at the end I had to agree with Flyvbjerg’s analysis. Perhaps optimism bias is also an issue for those researching mega projects?

Drummond (Ch 9) concludes that similar optimism bias prevents projects from being adequately evaluated along the way, with psychological factors such as project managers investment in the project, as well as the social kudos of being seen to persevere tending to lead to project escalation in the face of problems rather than adequate discussion of stopping them. Miller et al (Ch 10) add to this thesis, demonstrating that value is created through ‘games of innovation’ in which changes to the project become opportunities to add value (or capture value in the case of partnership arrangements) and that this feeds the tendency for projects to expand. ‘Clients or sponsors do not sit idle when challenged by risks and difficulties. On the contrary, they shape their projects according to the specific issues that need to be solved.’ (p.221). As Drummond highlights, all points of change create a new opportunity for optimism bias to express itself.

Clegg et al (Ch11) take up the question of the political in mega projects through an examination of how power operates in mega projects. They observe that standard management practice, stemming from engineering practice, is singularly ill equipped to deal with questions of power and politics in mega projects. Gill (Ch 12) takes this issue of the political to an examination of how mega projects are fields of collective action. He suggests that as mega projects are almost always collective actions of actors who must agree on local decisions, then some slippage or change in the project is inevitable. While these issues have been placed in the category of ‘causes’ of issues with mega projects, both authors conclude that the need to negotiate is not always a bad thing, and that understanding success in projects should take these changes into account.

Baade and Matheson (Ch 13) also suggest that politics (or rhetorical desires) is the cause of emerging economies bidding for mega-events such as the Olympic Games, Commonwealth Games and World Cup. Their analysis attempts to demonstrate that these political yearnings are often not delivered, or are delivered while at the same time leaving legacy venues which are costly to maintain, and of questionable benefit to the community. This theme is also raised by van der Westhuizen (Ch 24) in discussions around the case of South Africa’s Gautrain (a fast train network connecting Johannesburg and Pretoria, and Pretoria and OR Tambo airport), which was linked, at least in political rhetoric, to the World Cup.

In dealing with what is the last of the issues in the book, Hodge and Greve (Ch 16) review the question of private finance of projects and thus the involvement of the private sector as a way to resolve ‘issues’ with mega projects. They point out that while private finance is held out to be a way towards better cost analysis, better project selection and greater project success, there is very little evidence that it actually achieves the result. They suggest a way to make comparisons would be to develop a sense of unit costs that would allow comparison across projects, but point out that this is not done. The cautionary tale of Public Private Partnerships continues in Chung’s analysis of private road provision in Australia (Ch 23), which documents an evolution of risk sharing over time. An evolution which it would seem has yet to provide a solution to the question of how to incentivise actors in these projects to behave.

As I noted in my introduction, all of the above chapters broadly accept that mega projects are here to stay and the job must be to improve them. Three chapters in the book manage to challenge this orthodoxy in some way. Ren (Ch 7), discusses the mega project boom in China in the 1990s and 2000s, which is now winding down. Ren describes the conditions that drove this boom, which include the land acquisition capacity of municipal governments, and the way that they can borrow from banks for infrastructure, using Local Investment Companies or quasi government agencies. The chapter suggests that the boom of infrastructure investment which was started with mega events and was followed by a huge stimulus package in 2009, is now over, and raises the question of legacies from this boom. For example there has been significant expansion of local government debt followed by a need to refinance which has reduced the debt somewhat but has had a lasting impact on the availability of capital for private investment. What is not dealt with is the question of what China is to do with the vast numbers of construction workers who will now need to find new modes of work.

The question of legacy is similarly asked in both Chapters 19 and 25 dealing with dam projects. Scudder (Ch 19) resoundingly concludes, on the basis of 62 years of experience in this field, that there is no good mega dam. He concludes, on the basis that environmental and social impacts are not adequately dealt with, and that legacies in terms of operating costs and decommissioning outweigh any benefits they ever produce, that mega dams (and probably large ones as well) should not continue. Ahlers et al (Ch 25) take this further in an evaluation of the political economy of large dams, which they say has shifted from an expansion of government control over resources and livelihoods, to expansion of control by private capital.

So how well then does this book meet its objectives? Recall there were two: to become the ultimate source for state-of-the-art scholarship, and to provide the most important contemporary readings. Certainly, many (possibly all) of the key scholars in mega projects I read in 2009/10 while preparing my PhD have made contributions to the book, but like any edited volume the quality of the chapters varies. Some of the chapters (for example Chapter 14) have achieved something remarkable – providing a literature review which guides the reader into a body of work, enhancing understanding of the body of work and how it fits into what the authors are discussing. Others (such as Chapter 17) provided me with an entirely new clarity about work which I had previously read. However, with the above objectives in mind, I was left wondering in some cases why the editor did not simply reproduce the seminal articles which these authors had already produced? There were several chapters which in my view provided little additional value to previously published work.

On the other hand, reviewing the book in the way I have done, has given me the opportunity to think about the relationships between bodies of scholarship on the challenges, causes and cures related to mega project management. It would seem that our scholarship often manages to compartmentalise issues, regardless of the general agreement that a core feature of mega projects is that they are complex, interdisciplinary things. The focus of most of the scholarship presented is to critique and pull apart mega projects, taking them piece by piece. While this is eminently reasonable, it suggests that perhaps there is further work to be done in recombining these elements.

Unsurprisingly given the editor’s body of work, the position of the book is that mega projects, regardless of the massive evidence that they don’t work in the main, are here to stay and that there is some rationale, therefore, in trying to manage them well. But I feel I need to ask whether the author has not to some extent been ‘bitten’ by the same bias as he finds in the projects themselves; a vain hope that if managed correctly the projects might turn out to be the right thing in the end. When I started my own research into mega projects I did so on the basis that like any technology, they could be used for good or for evil. I believed that what was needed was to harness mega projects, so that we could make it serve a broader, emancipatory and environmentally sustainable agenda. However, by the end of the book, particularly after reading the damning indictment of large dam projects, I was left wondering if mega projects should be undertaken at all. This book doesn’t address this question. Indeed, perhaps as a book about mega project management it could not be expected to do so, after all my own findings suggest that a key logic of mega project management is an inability to question if mega projects should happen at all (Sturup, 2010). It is the nature of project management that once something is a project the question of management is to ensure the project can be done on time and on budget. We seem to have made some progress (Chapter 18) in improving comparisons of which mega project should be built, but the question of whether they should be done at all, and how to keep this option effectively on the table, remains unanswered both theoretically and in practice.

It could be argued that asking whether we ‘should’ do mega projects at all is a moot question, like asking if the sky ‘should’ be blue. It could be that they simply are or that they are necessary. Arguably, climate change, like the great challenge of water-borne disease at the end of the 19^th Century (which led to the development of large scale sewerage systems), suggests the need to significantly and quickly adjust our cities. Given the complexity and size of our cities any projects to radically alter the way they function are potentially mega projects. An example would be China’s current plans to retrofit 30 cities so that they capture, reuse or absorb 80% of rainwater by 2030 (Roxburgh, 2017). There is thus potentially a link between the future sustainability of our cities, and our capacity to create sustainable mega infrastructure. As has been pointed out, the current focus of mega infrastructure assessment on projects meeting time, budget and operations objectives, limits the capacity to consider their sustainability, or their impact on sustainable ways of living (Low & Sturup, 2019). Opening up the question of whether we should undertake mega infrastructure projects, is vital to creating the space to truly consider their sustainability. If they are inevitable, then we will remain unable to suggest alternatives that might include or indeed facilitate the radical behavioural shifts required for a sustainable urban future.