Editorial

This Special Issue contains a selection of papers addressing issues of key importance to the treatment of risk and uncertainty in mega infrastructure project decision making. In Part One, Ward presents findings from two strands of research undertaken by the OMEGA Centre. Firstly, of a study of the treatment of risk and uncertainty in decision-making by a variety of professions and disciplines where these dimensions have long been a key consideration in their decision-making for major complex projects. Secondly, of an evaluation of the decision making for 27 mega transport projects against a normative framework for the analysis and management of strategic risk informed by the earlier research findings. Stone then brings lessons from the military regarding the role of strategy and decision-making in addressing the challenges of its formulation across changing political, territorial and technological contexts, whilst Zhu, Shi and Lempert consider a reframing of decision making for the Belt and Road Initiative (BRI) to better manage the deep uncertainties and inherent risks in the long-term planning of this immense trans-national infrastructure development programme.

In Part Two, Perry discusses the risks and uncertainties involved in decision-making for major projects at the local level encountered by the real estate industry for commercial and retail developments, contrasting approaches undertaken by investors and developers in different and changing economic and political climates. Alberti exposes some of the limitations of probabilistic risk assessment in mega transport investments and the uncertainties they spawn via a study of three Latin American case studies and suggests new ways of more effectively constructing and addressing a holistic set of project risks and uncertainties. Finally, Morrissette reviews the traditional risk management paradigm adopted by mega project professionals internationally, revealing some of the practical limitations and typical pitfalls of deploying such processes in the field and suggesting some potential responses to them.

In some senses, the two sets of papers can be differentiated by their coverage of the temporal dimension of decision making under risk and uncertainty. The papers in Part One, for example, tend to focus more on the broad strategic uncertainties and risks, or what Zhu, Shi and Lempert call ‘deep uncertainties’, that are commonly encountered in the planning phases of mega project decision making and their relationship with notions of long term project success. The papers within Part Two have instead, for the main part dealt with typologies of risk and uncertainty, and tools for their analysis and management that are more in keeping with the immediate and shorter-term notions of delivery success. It is contended here that the differing focus of these two sections does not mean they are dislocated and/or can stand alone: it is important that links are instead forged between them so as not to overlook the longer-term consequences and impacts of short-term project outcomes and/or delivery level. As Lane and Maxfield argue (2005, 7), this is particularly so given “action happens over time, and how it develops is not scripted in moments of choice but emerges through interactions among actors” throughout the mega project development process.

Whilst the papers are written from a diverse range of standpoints (from infrastructure planning, military studies, operations research, real estate development, investment banking and project management), this collection of papers identifies several commonly held and significant perspectives and cross-cutting themes. One such important cross-cutting theme is the role of changes in context impacting decision making and decision-making outcomes. Whilst this issue has been discussed at some length in previous issues of this journal (see Dimitriou and Field 2019), its continued prominence should come as no surprise for this issue too. Especially given that no decision takes place within a vacuum; there is always a context, be it, temporal, spatial, cultural, and/or institutional in nature.

As highlighted by Hall (1980) long ago, and much earlier by Friend and Jessop (1969), contexts (and their changing values, technologies etc.) can have very significant impacts on decision making, and thus pose major risks and opportunities to a project’s planning and development. Engwall (2003, 1) contended that for this reason, a project should always be understood in relation the “previous and simultaneous courses of activity, to future plans, and to standard operating procedures, traditions, and the norms of its surroundings”. Given these longstanding observations, it is surprising that recent research suggests the potential impacts of changing contexts and the myriad risks they pose to projects is still not fully appreciated in infrastructure planning and appraisal. In presenting findings of OMEGA centre research, Ward concludes ‘all too often Megaprojects fail to undertake effective sensemaking of changing contextual influences throughout the project lifecycle’ leading to situations in which such planning and development processes simply react to contextual change ‘after the fact’ which can (and does) lead to a significant mismanagement of risks plus loss of opportunities over both the short and long term.

Zhu, Shi and Lempert illustrate this same issue where emergent contextual factors serve to threaten the success of the BRI, as “unexpected developments have invalidated many assumptions under the original design of the BRI, which call for a reflection, reassessment, and recalibration. “A key point made by Perry, is that contexts are always changing, frequently creating conditions for the emergence of new and previously unanticipated risks, and that the infrastructure industry needs to find ways to deal with this recurrent challenge more effectively. For Stone, researching strategic decision-making from a military perspective, context sensitivity is a key component of successful strategy formulation. A technical intervention that gains dominance in one context, he suggests, will not automatically do so in another without the ability to understand the subtleties of this new context. Morrisette, who investigates international project management experiences concurs with these previous observations. She sees one of the pitfalls in contemporary risk management practice is the oversimplification of context to suit underinvestment in more rigorous risk management practice, whilst Alberti goes a step further and presents a methodology which looks to more effectively capture different stakeholder perceptions of context within the risk analysis process itself.

Regarding the risks (and opportunities) posed by the dynamic nature of contexts, many authors in this Special Issue allude to the specific challenges of developing infrastructure under the deep uncertainties of Covid-19. Perry, for example, highlights the dramatic structural shift taking place within the property development industry in response to the pandemic, with developers moving away from what was previously seen as traditional lower risk developments, such as retail and towards facilities such as warehousing, essentially also representing a move from the centre to the periphery of urban areas. Morrissette laments the fact that despite the 2016 World Economic Forum Global Risk Report highlighting the risk of the spread of infectious diseases (WEF, 2016, 86)” it didn’t receive the prominence required to more effectively mitigate the impacts of the 2020 global pandemic”.

From the various contributions to this Special Issue, we can conclude overall that these characteristics of a context – which we here can refer to collectively as ‘the power of context’ (after Gladewll 2000) - provide conditions that offer both opportunities for and constraints to decision-making. They are associated with values and goals that are brought to bear by megaproject professionals as part of an on-going decision-making process, which appear in increasing cases to need more reliable and resilient ways to keep ahead of the curve in terms of identifying and responding to critical, and sometimes volatile challenges in uncertain times. This is particularly the case where dramatic shifts of context globally have been experienced since the global economic crisis of 2007/8, the mainstreaming of climate change, and the geopolitical and pandemic challenges faced at the time of writing.

Another cross-cutting strand to this Special Issue concerns the necessity of considering the inherently social and interconnected nature of risk and uncertainty. This has several implications for contemporary risk analysis and decision-making management practices for mega infrastructure projects as highlighted by both the papers of Alberti and Morrissette. Considering risks as social constructs challenges the current dominance of technocratic decision making led by experts. For example, given risks are not all equal (Renn, Klinke, and van Asselt 2011) and the sole role of ‘experts’ in this process is contested (Renn 2008), the technical risk literature is criticised as being a strongly hierarchical body of knowledge built around the expert, creating strong asymmetries of knowledge and power (Tansey and O'Riordan 1999). In response to these circumstances, Alberti’s paper offers an insight into a recent paradigm shift towards considering more human factors in risk management by advocating a more social and interdependent perspective of risk (and the subsequent treatment of related uncertainties). By acknowledging the tendency for multiple social interactions in this way, both within the project and beyond the often narrowly defined project boundaries, makes mega projects not only more complex but requires a concomitant change in decision making practices among multiple stakeholders over different stages of the project lifecycle.

One of the more well-known discussions regarding this kind of impact of complexity on decision making stems from the work of Rittel and Webber (1973) who define as ‘wicked problems’ those challenges where the combined actions of social complexity and interdependencies render problems undefinable and hence unsolvable. Several of the papers in this issue describe problems within infrastructure decision making which are reminiscent of these characteristics of wicked problems as recounted by Chester and Allenby (2019) as well as Lane and Maxfield (2005). Interestingly in response to these types of challenges, the ensuing papers frequently advocate the adoption of more stakeholder-centric responses than commonly adopted during mega project decision making: The core focus of Zhu, Shi and Lempert’s paper, for example, advocates the adoption of more collaborative approaches, and better tools and techniques which, being interdisciplinary in nature, transverse professional and stakeholder silos to help deal with deep long term uncertainty that may emendate from a whole host of diverse sources. Stone’s insights for infrastructure planners, by considering mega projects, as with war, as sometimes a continuation of political means/aims, highlights the importance of stakeholder consultation to defuse conflicts of interest, and associated risks so prevalent and inherent in mega project planning and appraisal. Perry concedes that as the property development profession seeks to undertake a greater role in major projects with their greater complexities and risks, it too will need to seek ways to better foster a greater mutual understanding, trust and respect with a wider set of stakeholders than it has done traditionally. Likewise, Morrissette warns that whilst mega project professionals may prefer to work in silos, risks tend to propagate across such bureaucratically constructed boundaries. Effective risk management is hence much more likely when risk management paradigms stress the necessity to involve a wide range of stakeholders in the decision-making process. They must also be cognisant of differing cultures, aims and agendas amongst diverse groups, whilst not forgetting the importance of the end user in all this.

E. John Ward
[email protected]