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Has Nigeria Become the World’s Junk Yard of Abandoned and Failed Mega Projects worth Billions?

Dim1, N. U., Okorocha2, K. A., & Okoduwa3 V. O.

The Nigerian construction industry is mostly concerned with the development and provision of projects such as roads, bridges, railways, residential  and commercial real estates, and the  maintenance necessary for the socio-economic developments contributes immensely to the Nigerian economic growth (Bureau of Statistics, 2015). Butcher and demmers (2003) described projects as an idea which begins and ends by filling a need. However, a project fails when its idea ends without meeting the needs and expectations of its stakeholders.

Nigeria Has Become the World’s Junk – Yard of Abandoned and Failed Projects worth Billions of Naira!

Hanachor (2013), revealed that projects form part of the basis for assessing a country’s development. However,  a damming  report from the Abandoned Projects Audit Commission which was set up by the Ex-President Goodluck Jonathan in 2011 revealed that 11,886 federal government projects were abandoned in the past 40 years across Nigerian  (Abimbola, 2012). This confirmed the assertion by Osemenan (1987) “that Nigeria has become the world’s junk –yard of abandoned and failed projects worth billions of naira”.

Abandoned projects including building and other civil engineering infrastructure development projects now litter  the  whole of Nigeria.

Physical projects do not only provide the means of making life more meaningful for members of the community where the projects are located, successful  projects also  result in  empowerment and collective action towards self improvement (Hanachor, 2013).  

This Issue of Abandonment Has Been Left Without Adequate Attention for Too Long, and Is Now Having a Multiplier Effect on the Construction Industry in Particular and the Nigeria’s National Economy as a Whole. (Kotngora, 1993)

PROJECT FAILURE

Project Failure might mean a different thing to different stakeholders. A project that seemed successful to one stakeholder may be a total failure to another (Toor and Ogunlana, 2008). Some stakeholders, more especially the project users and some private owners, think of failed projects as a situation where a completed building project collapsed, a situation where by a completed dam project stopped working after few days of completion, or a completed road project that broke down after few months of completion. Other experienced stakeholders, such as engineers  and  architects  conform to the iron triangle by Atkinson (1999) which states that the most strategically important measures of project failure are “time overrun”, “cost overrun”, and “poor quality”.

Turner (1993) noted that a project fails when the project specifications are not delivered within budget and on time;   the project fails to achieve its stated business purpose; the project did not meet the pre-stated objectives; the project fails to satisfy the needs of the project team and supporters; and the project fails to satisfy the need of the users and other stakeholders. Lim and Mohamed (1999) cited in Toor and Ogunlana (2009) clarified that there are two possible view points to project failure namely; the macro-level and the micro-level. They further explained that the macro view point reviews  if the original objectives and concepts of the project was met. Usually the end users and the project beneficiaries are the ones looking at the project failure from the macro view point, where as the project design team, the consultants, contractors, and suppliers review projects from a micro view point focusing on  time of delivery, budget, and poor quality.  

In the early 1990s, the failure as well as the success of any project was determined by the project duration, monetary cost, and the performance of the project (Idrus, Sodangi, and Husin, 2011). Belout and Gauvrean (2004), also confirmed that the project management triangle based on schedule, cost, and technical performance is the most useful in determining the failure of a project. Moreover, a project is considered as an achievement of specific objectives, which involves series of activities and tasks which consume resources, are completed within specifications, and have a definite start and end time (Muns and Bjeirmi 1996, cited in Toor and Ogunlana, 2009). Reiss (1993) in his suggestion stated that a project is a human activity that achieves a clear objective against a time scale. Wright (1997) taking the view of clients, suggested that time and budget are the only two important parameters of a project which determines if a project is successful or failed. Nevertheless, many other writers such as Turner, Morris and Hough, wateridge, dewit, McCoy, Pinto and Slevin, saarinen and Ballantine all cited in Atkinson (1999), agreed that cost, time, and quality are all success as well as failure criteria of a project, and are not to be used   exclusively.

FACTORS OF PROJECT FAILURE

Cookie-Davies (2002) stated the difference between the success criteria and the failure factors. He   stated that failure factors are those which contributed towards the failure of a project while success criteria are the measures by which the failure of a project will be judged. The factors constituting the failure criteria are commonly referred to as the key performance indicators (KPIs).  

Time   and Cost Overrun

The time factor of project failure cannot be discussed without mentioning cost. This is because the time spent on construction projects has a cost attached to it. Al-Khali and Al-Ghafly, (1999); Aibinu and Jagboro, (2002) confirmed that time overrun in construction projects do not only result in cost overrun and poor quality but also result in greater disputes, abandonment and protracted litigation by the project parties. Therefore, focus on reducing the Time overrun helps to reduce resource spent on heavy litigation processes in the construction industry (Phua and Rowlinson, 2003). Most times, the time overrun of a project does not allow resultant system and benefits of the project to be taking into consideration (Atkinson, 1999). Once a project exceeds the contract time, it does not matter anymore if the project was finally abandoned or completed at the same cost and quality specified on the original contract document, the project has failed. Furthermore, Assaf and Al-Hejji, (2006) noted that time overrun means loss of owner’s revenue due to unavailability of the commercial facilities on time, and contractors may also suffers from higher over heads, material and labour costs.

Poor quality/Technical Performance

The word “Performance” has a different meaning which depends on the context it is being used and it  can also be referred to as quality. Performance can be generally defined as effectiveness (doing the right thing), and efficiency (doing it right) (Idrus and Sodangi, 2010). Based on this definition of performance, at the project level, it simply means that a completed project  meets fulfilled the stakeholder  requirements in the business case.

CAUSES OF PROJECT FAILURE

A lot of research studies have investigated the reasons for project failures, and why projects continue to be described as failing despite improved  management. Odeh and Baltaineh, 2002; Arain and   Law, 2003; Abdul-Rahman et al., 2006; Sambasivan and Soon, 2007; all cited in Toor and Ogunlana, 2008, pointed out the major causes of project failures as Inadequate procurement method; poor funding and availability of resources; descripancies between design and construction; lack of project management practices; and communication lapses

The contract/procurement method

A result obtained from two construction projects which were done by the same  contractor but using different procurement methods showed that rework, on the design part which occurs when the activities and materials order are different from those specified on the original contract document, makes it difficult for the project to finish on the expected time (Idrus, Sodangi, and Husin, 2011). This is as a result of non-collaboration and integration between the design team, contractor, and tier suppliers. The rework on the design portion has a huge impact on  project failure leading to the time overrun.  The traditional method of procurement has inadequate  flexibility  required  to facilitate late changes to  the project design once the design phase of the construction project has been concluded.

Nigerian most widely used procurement method is the traditional method of procurement (design-bid-construct) which has been confirmed to be less effective to successfully delivery of a construction project (Dim and Ezeabasili, 2015). And, the world bank country procurement assessment report (2000) cited in Anigbogu and Shwarka, (2011) reported that about 50% of projects in Nigeria are dead even before they commence because they were designed to fail.

The way the construction projects are contracted, in addition to the way the contracts are delivered, contributes to the causes of projects failure. Particularly, among the methods of project contracting is lump-sum or a fixed-price contracting method, in which the contractor agrees to deliver a construction project at a fixed price. The fixed-price contract can be low-bid or not however, once the contract cost has been agreed upon the contract award, it cannot be changed. And, contractors are expected to honor and deliver the contract agreement, failure to do so can result  in a  breach of contract which can result in the contractor being  prosecuted.  

Awarding a contract to an unqualified personnel also contributes to project failures. When a contractor places more emphasis on money and the mobilization fee after a construction project has been initiated instead of getting the right workforce and skilled professionals that will execute the project. Instead the workforce chosen will often not be base on competence and required skills rather it will be based on availability. Moreover, poor strategy and planning by contractors who have overloaded with work  also contributed to one of the causes of project failure.

Poor funding/Budget Planning

A lot of public projects in the Nigerian construction industry failed as a result inadequate funding, and the difference between the national annual budget and the budget actual released. Most of the Nigerian public projects are signed  even before the actual release of the national budget. The difference in budget of the contracted project and the actual budget release can get the contracted company stuck as a result of inflation of prices, scarcity of construction material at the time of the budget release and mobilization to site. Also  un-planned scope of work which can be as a result of the contractor working on another contract when he is called back  to  mobilization to start work. Moreover, poor budget planning is a regular mistake made by some contractors by not undertaking feasibility assessments  before starting the design. The construction project should be planned according to the available resources and not according to the unrealistic expectations a  client has in mind.

Discrepancies  Between the Design and Construction

Limited  collaboration between the contractors, engineers, and the architect results in discrepancies between the project designs and construction on site, and further leads to rework. Changes on a project designs, and changing to the scope of work in the middle of construction processes on site can be dangerous, and can lead to time overrun, increase in cost, and most of all can lead to abandonment. Moreover, many cases have been seen where the designs from the architects are not buildable  on site, while   In some cases, most contractors are unable to adequately specify the scope of work for the construction processes on site. Therefore any default on the design by the architect can be an opportunity for the contractor to make more money which might cause the project duration to exceed the time specified on the contract document.

RESEARCH METHODOLOGY

This research starts with a general reasoning or theory which says that the major cases of project failure in the Nigerian construction industry are defined based on time overrun and cost overrun. The findings from the data analysis will help on the decision to accept the theory or not. The research data was collected from the progress report for the month ending of October, 2015 published by the Nigeria of Federal Ministry of works on thirty-nine on-going highway construction projects at the South-South geopolitical zone. The table 1 below shows the information on the data collected which comprises of the project title, contract Number, project description, the contractor that was awarded the projects, the date of project commencement, date of completion and the extended date if any. The scheduled time for each project was specified as follows: project commencement date labeled as “a”,   project completion date labeled as “b”, and the extended date labeled as “c”.

Table 1: The analyzed data on the highway project at the South-South zone in Nigeria.
Table 1: The analyzed data on the highway project at the South-South zone in Nigeria.

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DATA ANALYSIS

The data analysis was done with the use of Microsoft excel. The analysis started by obtaining the number of days between the date of commencement of each project and the date of completion to show the duration of each highway project. And, the number of days between the project completion date and the extension date showed the time-overrun. The project duration and the extended days were obtained with the use of NETWORKDAYS function in Microsoft Excel which calculates the number of working days between two dates excluding weekends and any dates identified as holidays.

The standard deviation between the specified project duration for each highway projects and the extended days was calculated to obtain the extent to which each highway project contract failed on its time of delivery. This was denoted as the degree of failure. The table 1 above showed the projects ranking which was done based on the degree of failure of all the highway projects. The highway projects that were ranked from one to sixteen have low degree of failure and are represented with green color, while the rest are those with high degree of failure and are represented with red color.

FINDINGS

The findings made showed that the successfully completed highway projects have no extended days or time overrun, and the successful on-going highway projects are still on schedule and have no extended days unlike the on-going highway projects that have already failed as a result of the extended dates. Other projects have been abandoned because they have exceeded the delivery date as specified on the contract document, and have no extended date of completion. Thus, no work is going on.

Figure 1: Abundance of failed highway projects at south-south zone, Nigeria.
Figure 1: Abundance of failed highway projects at south-south zone, Nigeria.
Figure 2: On-going failed highway projects
Figure 2: On-going failed highway projects

Figure 2 above showed that 14% of highway projects are still on-going projects because they have not exceeded the original date of completion as specified on the contract document. However, they are heading towards failure because they have been given an extended date of completion which can be as a result of some critical activities running behind schedule, causing delay on the critical path network of the projects. Moreover, the other 86% completely failed because they have exceeded their completion date specified on the contract document.

Figure 3: Successful on-going highway projects
Figure 3: Successful on-going highway projects

The figure 3 above showed that 63% of the successful highway projects are still on-going because they have not exceed their completion dates, and they are not yet completed. However, those on-going highway projects might end up as failed projects as a result of poor funding, discrepancy between the design and the construction on site, and conflict between the construction parties or stakeholders.

“Say what you will do, and do what you said” or “Say as you will do it, and do it as you said”

CONCLUSION AND RECOMMENDATION

The idea of knowing what a failed project is, the factors and the causes is very important in project management. Success in project management can neither be achieved nor measured without the knowledge of project failure, its factors, and causes in the Nigerian construction industries. This work has shown that project failure is as a result of exceeded time of delivery, cost overrun, and poor quality. However, the analysis was only done based on exceeded time of project delivery because of the nature of the data collected.

This work suggested a few approaches to help reduce the number of failed projects in the Nigerian construction industry if properly implemented. Firstly, Having good collaboration between the project stakeholders involved in a construction project at the early stage of project conception is most important in order to accomplish the project objectives, and deliver the project on time, within budget, and quality specified on the original contract document (Othman, 2006).

Secondly, Adopting the ISO 9000 technique which is used for quality management will also help in achieving a successful project delivery. This technique states “ say what you will do, and do what you said” or “say as you will do it, and do it as you said”. This technique is not an indication of high quality but it promotes control and consistency which leads to specialization, and improved productivity and quality. Also, adopting the principles of lean construction will help to reduce waste within the construction and stream-line activities in order to improve the on-time delivery of projects.

Thirdly, Learning from the precedent failed projects, how those projects failed, and the reason for their failures. This will help the project manager  to plan and mitigate the risks of project failures in the future. And, finally, more seminars and workshops will help to educate and enlighten clients (the federal government representatives), users, contractors, engineers, and architects on what is project failure, the factors that contributes to abundant failed projects, and their causes.

REFERENCE

Abimbola, A. (Novermber 24, 2012). About 12,000 Federal Projects Abandoned across Nigeria. Premium times (November 16, 2015). Retrieved from www. Premium timesng.com/news/108450-about-12000-federal-projects-abandoned-across-nigeria.html.

Al-Khali, M.I and Al-Ghafly, M.A. (1999). Important Causes of Delays in Public Utility Projects in Saudi Arabia. Construction management and Economics, 17, 647-655

Aibinu, A.A and Jagboro, G.O. (2002). The Effects of Construction Delays on Project Delivery in Nigeria Construction Industry. International journal of Project management, 20(8), 593- 599.

Anigbogu, N. and Shwarka, M. (2011). Evaluation of Impact of the Public Procurement Reform Program on Combating Corruption Practices in Public Building Project Delivery in Nigeria. Environtech Journal, 1(2). 43-51.

Assaf, S. and Al-Hajji, S. (2006). Causes of Delays in large Construction Projects. International Journal of Project Management, 24, 349-357.

Atkinson , R. (1999). Project management: Cost, time, and quality, two best guesses and a Phenomenon, it’s time to accept other success criteria. International Journal of project Management, 17(6), 337-342.

Belout, A and Gauvrean, C. (2004). Factors Influencing the Project Success: The impact of human resource management. International Journal of project Management, 22, Pp. 1-11.

Butcher, N. and Demmers, L. (2003). Cost Estiumating Simplified. Retrieved from www.librisdesign.org.

Cookie-Davies, T. (2002). The Real Success Factors on Projects. International Journal of Project management, 20(3), 185-190.

Dim, N.U. and Ezeabasili, A.C.C (2015). Strategic Supply Chain Framework as an Effective Approach to Procurement of Public Construction Projects in Nigeria. International Journal of Management and Susutainability, 4(7), 163-172.

Hanachor, M. E. (2012). Community Development Projects Abandonment in Nigeria: Causes and Effects. Journal of Education and Practice, 3(6), 33-36.

Idrus, A., Sodangi, M., and Husin, M., H. (2011). Prioritizing project performance criteria within client perspective. Research Journal of Applied Science, Engineering and Technology, 3(10), 1142-1151.

Idrus, A. and Sodangi, M. (2010). Framework for evaluating quality performance of contractors in Nigeria. International Journal of Civil Environment and Engineering. 10(1), 34-39.

National Bureau of Statistics (January, 2015). Nigerian Construction Sector Summary Report: 2010-2012.

Kotangora, O. O. (1993). Project abandonment, Nigerian Tribune.

Osemenan, I. (1987). Project Abandonment. New Watch Magazine, Vol. 1, pp. 15.

Othman, M.,R. (2006). Forging main and sub-contractor relationship for successful projects. Retrieved from http://rakanl.jkr.gov.my/csfj/editor/files/file/projek/lessonslearned/MAIN&SUB_2.pdf

Phua, F.T.T and Rowlinson, S. (2003). Cultural Differences as an Explanatory Variable for Adversarial Attitude in the Construction Industry: The case of HongKong. Construction Management and Economics, 21, 777-785.

Reiss, B. (1993). Project Management Demystified. London: E and FN Spon Publishers.

Toor, S. R. and Ogunlana, S. O. (2008).Problems causing Delay in Major Construction Projects in Thailand. Construction management and Economics, 26, 395-408.

Toor, S. R. and Ogunlana, S. O. (2008). Critical COMs of Success in Large-Scale Construction Projects: Evidence from Thailand constructuction industry. International Journal of Project management, 26(4), 420-430.

Toor, S. R. and Ogunlana, S. O. (2009).Beyound the “Iron Triangle”: Stakeholder perception of key performance indicators (KPIs) for large-scale public sector development projects. International Journal of Project management, doi: 10.1016/j.ijproman.2009.05.005.

Toor, R. and Ogunlana, S. (2009). Construction Innovation: Information, process, management. 9(2), PP. 149-167.

Turner, J. R. (1993). The Handbook of project-Based Management: Improving the process for achieving strategic objective. London, McGraw-Hill.

Wright, J., N. (1997). Time and Budget: The twin imperatives of a project Sponsor. International Journal of Project Management, 15(3), 181-186.

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15 Shocking Project Management Statistics

15 Shocking Project Management Statistics

The project management landscape is changing  with an increased emphasis on productivity, reporting, and information technology. A number of studies have been completed that look into the success and  failure rates of projects.

Below are  15 shocking  statistics that reveal how project management has changed and is performing across various industries over the last 5 years.

  1. There is  projected to be 15.7 million new project management roles to  be added globally across seven project-intensive industries by 2020 reaching an economic impact of over $18 trillion, across seven project-intensive industries  including  Manufacturing, Finance & Insurance, Information Services, Utilities, Business Services, Oil & Gas  and  Construction (Project Management Institute)
  2. 75% of IT executives believe their projects are “doomed from the start. (Geneca)
  3. The healthcare industry is projected to increase project management roles by 30%,  a higher growth rate than any current project intensive industry between 2010 and  2020. (Project Management Institute)
  4. A third of all projects were successfully completed on time and on budget over the past year. (Standish Group)
  5. 80% of “high-performing” projects are led by a certified project manager.  (PricewaterhouseCoopers, Insights and Trends: Current Programme and Project Management Practices 2012)
  6. One in six IT projects have an average cost overrun of 200%.  (Harvard Business Review 2004)
  7. 44% of project managers use no software, even though PWC found that the use of commercially available PM software increases performance and satisfaction. (Pricewaterhouse Coopers)
  8. More than 90% of organizations perform some type of project postmortem or closeout retrospective. (The Standish Group: CHAOS Research Report 2013)
  9. On average, it takes 7 years in the profession to go from entry-level to managing large, complex projects.  (ESI International: Annual Salary Survey 2013)
  10. The average large IT project runs 45% over budget, 7% over time, and delivers 56% less value than expected. (Project Management Institute: Pulse of the Profession 2015)
  11. Only 64% of projects meet their goals. (Project Management Institute: Pulse of the Profession 2015)
  12. 60% of companies don’t measure ROI on projects. (KPMG New Zealand: Project Management Survey 2010)
  13. The United States economy loses $50-$150 billion per year due to failed IT projects. (Gallup Business Review)
  14. In just a 12 month period 49% of organizations had suffered a recent project failure.  In the same period only 2% of organizations reported that all of their projects achieved the desired benefits.  86% of organizations reported a shortfall of at least 25% of targeted benefits across their portfolio of projects and many organizations failed to measure benefits so they are unaware of their true status in terms of benefits realization. (KPMG – Global IT Project Management Survey 2005)
  15. According to an IBM study, only 40% of projects meet schedule, budget and quality goals. (Harvard Business Review 2004)

If you have any other project management statistics please share them with us.

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66% of IT Projects Fail

Is Britain a nation of slient Christians?

Only one in three software projects will turn out to be successful. According to Standish Group’s 2015 Chaos report, 66% of technology projects (based on the analysis of 50,000 projects worldwide) end in partial or total failure. More surprisingly, these statistics have been the same for the last five years, the report shows. Furthermore, 17% of large IT projects go so badly that they can threaten the very existence of  a company.

On Average, Large It Projects Run 45% over Budget and 7% over Time, While Delivering 56% Less Value than Predicted

Despite such failures, huge sums continue to be invested in IT projects and written off. For example the cost of project failure across the European Union was ┚¬142 billion in 2004.

It Projects Always Come with an Element of Risk, but There Are Huge Gains to Be Had If We Can Just Avoid Some of the Factors That Contribute Frequently to Project Failure

What makes a IT project successful, though?

According to the Standish Group, a successful project is on time, on budget and has satisfactory results (value, user and sponsor satisfaction, and meets target requirements). Other measures of success are widely known and accepted as true such as getting requirements right, providing effective leadership, and having full support and engagement from sponsors and users. Without these, it’s unlikely that any project would succeed.

But there’s more to success than what is widely known and, apparently, rarely followed. To reduce the risk of failure for your tech project, here are  six key actions to take on the road to success.

1. Executive Vision and Involvement

Without a Executive Senior Sponsor Its Easy for Projects to Fail with the Organizational Resistance That Accompanies Large Change

Executive involvement is a primary variable in predicting the success of an IT project.   Having a leadership team aligned across an organization articulating the purpose, value, and rationale for a project goes a long way towards getting stakeholders and end-users pulling the proverbial rope in the same direction.

2. Have a clear view of scope and timetable

Oftentimes, a tech project flops because its developers fail to plan and rush forward with  an idea. However, some project  managers plan so meticulously that they end up falling behind and lose momentum. The best approach is somewhere in between.

Interviewing team members, documenting requirements, prioritizing what is “mission critical” versus “nice to have,” getting agreement across stakeholders can feel like a never-ending cycle.   As a result, requirement gathering has fallen out of fashion with many organizations  in the past few years.

However, the ideal starting point for a successful technology project is to have a set of fundamental requirements with sufficient detail to develop against.

Requirement Gathering Is Labour-intensive and Challenging but Remains the Roadmap and Measuring Stick for Software Projects

This approach allows you to maintain sight of the business benefits as well as engaging stakeholders and responding to their feedback.  In combination with a  clear business case, a  well-defined set of requirements also simplifies design and testing, two areas where projects tend to go  sideways.

Ensure that requirements for the project are clearly defined and agreed upon among stakeholders and that you have a way to track, measure, and manage changes in requirements as appropriate during the project.

3. Define how you will deliver

When it comes to delivering a major project, one size does not always fit all. All products are customizable to some degree, so what might have worked  in one company may not work in another company.

That being said, why reinvent the wheel if it’s already proven successful?  Sometimes it  can be more beneficial to  use an existing  off the shelf solution. Whichever direction you take,  choose the delivery mode that works best for your company.

4. Risk Identification and Management

Every project has risk and  there are many  factors out of your control. People leave the organization, for better or worse, leadership changes,   budgets get cut, however, many risks  to projects can be mitigated or even eliminated with some forethought and on-going management.    For example, do you have the resources you need to deliver the project (resource risk).   Are project goals clearly understood and requirements clearly defined (scope risk).   Do you have a realistic project plan and timeline (time risk).

Mitigating Risk Is a Combination of Science and Art, and Always a Balancing Process

5. Test your product again and again

A technology project is something that should overall support your business. It should not be something that dictates and forces you to  change your operations. If this is happening, you should shift gears and focus on tweaking the technology, rather than lowering expectations and adopting less ideal requirements.

Adequate testing is a must for any tech project. While some features may be fine with automated testing, the best approach is to have a dedicated testing team. Testing activities should mirror those with the development team throughout the project’s lifetime. With thorough testing, a project should deliver with less design flaws or missing requirements.

6. Prioritize simplicity and performance

Developers often leave the external look and feel of a product to the wayside thinking these things are not necessities for the consumer to enjoy. However, user experience is absolutely critical to the success of the project.

Developers must consider things like storage, network requirements, processing speeds and overall performance in order to satisfy the customer. If users are going to have to wait for an extended period to allow information to load, there must be a good reason for the wait, otherwise they won’t return for future products.

Simplification and Improved Efficiency Is What Adds Value

Ultimately, using the product should be a smooth and intuitive experience. Additionally, tools and alternative routes must be placed logically without being intrusive. The process can be complicated, but the finished product should emit simplicity. After all, that’s what makes companies like Apple so successful. Simplification and improved efficiency is what adds value.

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65% of Mega-projects Fail

There’s a reason why  Mega-projects are simply called “Mega-projects.” Extremely large in scale with significant impacts on communities, environment and budgets, mega-projects attract a lot of public attention and often cost more than 1 billion. Because of its grandiose, a successful mega-project requires a lot of planning, responsibility and work. Likewise, the magnificence of such projects also creates a large margin for failure.

Mega-projects Come with Big Expectations. But a Project’s Success Is Often in the Eye of the Beholder

Despite their socio-economic significance mega-projects – delivering airports, railways, power plants, Olympic parks and other long-lived assets – have a reputation for failure. It is thought that  over optimism, over complexity, poor execution, and weakness in organizational design and capabilities are  the most common root causes of megaproject failure.

Blinded by enthusiasm for the project, individuals and organizations involved with mega-projects often miscalculate the complexity of the project. When a mega-project is pitched, its common for costs and timelines to be underestimated while the benefits of the project are overestimated. According Danish economist Bent Flyvbjerg, its not unusual for project managers who are competing for funding to massage the data until it is deemed affordable. After all, revealing the real costs up front would make a project unappealing, he said. As a result, these projects are destined  for failure.

For example, building new railways spanning multiple countries could prove to be disastrous if plans are overly complex and over-optimized. Such a large-scale project involves national and local governments, various environmental and health standards, a wide range of skills and wages, private contractors, suppliers and consumers; therefore, one issue could put an end to the project. Such was the case when two countries spent nearly a decade working out diplomatic considerations while building a hydroelectric dam.

Complications and complexities of mega-projects must be considered thoroughly before launch. One way to review the ins and outs of a project is through reference-class forecasting. This process forces decision makers to look at past cases that might reflect similar outcomes to their proposed mega-project.

Poor execution is also a cause for failure in mega-projects. Due to the overoptimism and overcomplexity of a project, it’s easy for project managers and decision makers to cut corners trying to maintain cost assumptions and protect profit margins. Project execution is then overwhelmed by problems such as incomplete design, unclear scope, and mathematical errors in risk assessment and scheduling.

Researchers at McKinsey studied 48 struggling mega-projects and found that in 73 percent of the cases, poor execution was responsible for cost and time overruns. The other 27 percent ran into issues with politics such as new governments and laws.

Low productivity is another aspect of poor execution. Even though trends show that manufacturing has nearly doubled its productivity in the last 20 years, construction productivity remains flat and in some instances has even declined. However, wages continue to increase with inflation, leading to higher costs for the same results.

According to McKinsey studies, efficiency in delivering infrastructure can reduce total costs by 15 percent. Efficiency gains in areas like approval, engineering, procurement and construction can lead to as much as 25 percent of savings on new projects without compromising quality outcomes. This proves that planning before execution is worth its weight in gold.

We Tend to Exaggerate the Importance of Contracting Approach to Project Success or Failure

Finally, weaknesses in organizational design and capabilities results in failed megaprojects. For example, organizational setups can have multiple layers and in some cases the project director falls four or five levels below the top leadership. This can lead to problems as the top tier of the organizational chain (for example, subcontractors, contractors and construction managers) tend to focus on more work and more money while the lower levels of the chain (for example, owner’s representative and project sponsors) are focused on delivery schedules and budgets.

Likewise, a lack of capabilities proves to be an issue. Because of the large-scaled, complex nature of mega-projects, there is a steep learning curve involved and the skills needed are scarce. All the problems of megaprojects are compounded by the speed at which projects are started. When starting from scratch, mega-projects may create organizations of thousands of people within 12 months. This scale of work is comparable to the significant operational and managerial challenge a new start-up might face.

In the end, it seems that if organizations take the time to thoroughly prepare and plan for their mega-projects, problems like overcomplexity and overoptimism, poor execution, and weaknesses in organizational design and capabilities could be avoided. After all, mega=projects are too large and too expensive to rush into.

 

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13 Basic Facts You Should Know about Modular Homes

The concept behind a tiny garden pavilion in London, UK was simplified by the following equation: shed + office = Shoffice.

Modular homes sometimes referred to as “factory-built construction“,  encompass a category of housing built in sections typically at a factory  location.   These houses must conform to local and regional building  codes for the country the buyer plans to situate the dwelling.  

Just like site-built housing, construction teams build modular homes to  last and increase in value over time.   As the factory finishes building sections of the house, each piece is transported to the homeowners build site on large truck beds.   Local building contractors then assemble the house and inspectors ensure the manufacturer has built your residence to code.   Most customers find that modular housing is less expensive than  site-built homes.

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1. Benefits of Construction

One of the benefits of  construction is that manufacturers build them indoors in an enclosed factory setting, where the materials  used to build the homes are not subject to adverse weather during construction.  

Most building contractors can finish erecting a house in as little as 1-2 weeks, though it may take up to 4 weeks or more for local  contractors to finish building the dwelling on-site once it has been  delivered.

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2. Differences Between Modular and Site Built

Modular homes are not the same as site-built homes, which contractors create 100% at the build site.   That means the
contractor must collect all the materials for a house and built it on-site.   Like a modular home, the site-built home must conform to all regional, state and local building codes.   Many refer to site-built construction as stick-built homes.   Stick built housing is also well-built and designed to last a lifetime.

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3. Difference Between Modular and Manufactured

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Manufactured housing is another form of factory construction.   Many  consumers have mistakenly referred to these homes in the past as mobile homes.   Others refer to manufactured homes as trailers.   Manufacturers do build these houses in a factory like modular homes on a steel chassis.  

The manufacturer then transports sections of the home to the building site as completed.   These dwellings are usually less expensive than both modular housing and site built housing, in part because they don’t come with a permanent foundation.   Trailers and mobile homes are more likely to depreciate than modular or site built homes.

4, Advantages of Modular Construction Over Site Built

Modular homes offer many advantages over traditional site built dwellings. Many consider modular homes a hybrid breed of housing.   Not a manufactured house and not a site built house, these homes offer consumers multiple benefits including costs savings, quality and convenience.   In many ways modular homes surpasses site built housing in quality and efficiency.  

Modulars have grown up. They are more and more becoming a mainstream  selection for first time and secondary homebuyers.   Most people now realise they don’t’ have to give up design quality or customization to buy a prefabricated house.   One of the biggest misconceptions people have of prefabricated housing is they are look alike.   “Boxy” is not a word that can begin to describe prefab dwellings. In fact, more suitable descriptions of these buidlings would include: “Elegant, durable, customised and high-class”.   Many people find they can afford to include more specialization and customization when they buy a factory built house over a traditional stick built construction.  

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5. Cutting-edge Designs

Looking for a building design with a little pizzazz?   You need to check out the latest architectural designs associated with prefabricated buildings.   Firms are now building more    elegant and unique designs to meet the increasing demands of selective customers.   People are selecting modular designs over stick built designs to build their dream homes.

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6. Customised Design and Modification

There are hundreds of companies that offer modular prefabricated construction kits and plans, and most employ various architects and specialized designers to help customize your  home.   That means you have more choices and a wider selection of designers to choose from.   If you don’t find a style you like with one designer you can often move onto another, without even switching  manufacturers.  

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7. Huge Range of Selection

Its always best to select a home that matches your lifestyle and design preferences.

8. Rapid Customisation  

These are often the ideal selection for homeowners in need of a speedily designed homes.   You simply can’t build a dwelling faster.   Site built housing can take months to design and build.   A manufacturer can design and place a prefab house in a few short weeks. You can pick from just as many different styles as you would a site built home if not more, but don’t have to wait weeks for contractors to build your custom house.

9. Precise Budgeting and Timing

Yet another benefit of these designs is the lack of guesswork involved.   You don’t have to worry about how something will look.   You know that everything will arrive to the build site complete and you will know the exact outcome. You also don’t need to worry about unexpected expenses, which is commonly the case with site built homes.   With a prefabricated house, you know exactly what your home will cost and can control that cost from the point of buying to final construction.   This isn’t the case with stick built housing. With stick built housing you also have to worry about surprises in the middle of construction.   It isn’t uncommon for example, for a contractor to quit in the middle of a project.   If this happens you have few choices.  

Your home will sit partially built until you are able to find a new construction team.   This alone may cost you valuable time and money.  

10. Improved Energy Efficiency    

Many prefab houses also come with what manufacturers call the “Energy Star” certification.   This is a national company that promotes energy efficiency.   Buildings with this label use 30-40 percent less energy yearly than traditional stick built housing.  

This saves you time and money.   Some key features of prefabricated housing that help improve energy efficiency include tight installation,  high performance and weather resistant windows, controlled air systems and duct systems, upgraded air-conditioning and heating units and use of efficient lighting and heating appliances.   As a bonus, these features not only save on annual energy costs but also improve the quality of your indoor air. Think energy efficiency isn’t significant?   Think again.   Over the lifetime of your house you could save thousands of pounds  in energy bills by buying a prefabricated dwelling.

11. Design Modification is Easier  

Most prefab homemakers now use computer aided design systems when conducting operations.   This adds to the efficiency of construction and improves the appearance and architecture  of homes.   Prefabricated construction ranges from plain vanilla styling to intricate and complex modern designs.

12. On Time and  on Budget    

Perhaps the two biggest features or benefits of prefabricated housing that manufacturers hone in on are the speed that  they can be built with and the competitive pricing they can offer on the final product.   This is one reason that modular homes are gaining popularity.  

13. Appreciate in Value

These dwellings also appreciate much like site  built housing designs.   Most homeowners are interested in building value in their house over time.   Prefab housing afford you the opportunity to do this (keep in mind however much appreciation is dependent on real estate location).   Select a good build site and your house will gain significant value over time. Other factors may also affect appreciation including landscaping and how well the house is cared for year after year.   These factors also affect site built housing.   Unlike mobile homes, which depreciate, a modular homeowner can expect to gain value from their home year after year. Study after study suggests that modular homes appreciate just as well as site built homes.   They are also just as easily insured and financed.

As far as risk goes, you are no more at risk buying prefabricated housing than site built construction.

Modular Home Facts

  • Modular homes appraise the same as their on-site built counterparts do.
  • Modular homes can be more easilly customised.
  • Most modular home companies have their own in-house engineering departments that utilize CAD (Computer Aided Design).
  • Modular home designs vary in style and size.
  • Modular homes are permanent structures – “real property.”
  • Modular homes are considered a form of “Green Building.”
  • Modular homes are faster to build than a 100% site-built home.
  • Home loans for modular are the same as if buying a 100% site-built home.
  • Insuring your modular home is the same as a 100% site-built home.
  • Modular homes can be built to withstand 175 mph winds.
  • Modular homes can be built for accessible living and designed for future conveniences.


Would you consider a modular home for yourself, or are you more of a traditionalist?

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Project Manager or Scapegoat?

You Need to Stop Pointing That Finger

Big Project Failures Claim Their Victims in Spectacular Fashion

You’ve just been assigned a high visibility failing project  and  you’re working round-the-clock to get the work to the client on time, despite the fact that the job bears barely any resemblance to the project  you initially discussed. The  scope keeps creeping, the risk  and issue alerts are coming in thick and fast, the project is already  two months  past the original deadline, the clients are getting antsy even though they’re yet to provide you with various key pieces of information in order to baseline the project.  Is this your chance to shine  and showcase your skills?

If You Don’t Know Where You’re Going, You Will Probably End up Somewhere Else – Laurence J. Peter

If you manage to turn the project around and the project is successful, you will attract many fathers. However, if the project fails, you will probibly be  offered up as the  sacrificial lamb (scapegoat),  there is absolutely no way around it.  A  high percentage of projects fail to deliver useful results, that’s a  fact.

Project managers are  regularly blamed for schedule delays and cost overruns for projects they inherit by no fault of there own, however, in most cases, the fault for such issues rarely lies with just one person.

Sufficient data has been gathered to indicate that blockers such as unsupportive  management, senior sponsorship or low  resource availability are as much to blame for project failure as ineffective stakeholder management or poor communication.

Capture  all decisions

The only way to protect yourself is to ensure that you capture all decisions made in the project. In most cases  many of these decisions  will have been made by people above you. While you can influence decisions made by people under you. Get into the  habit  of building a dashboard early in the project and updating it each week with actuals.  Also consider using a  standard repeatable technique to analyse the health of your project.

Constrained resources

If you are in a project where resources are constrained, clearly outline the resources that you require to deliver the project in terms of time, scope, budget, risk  and  quality. If resources are pulled from your project, clearly articulate the affect of that in delivery terms and measure that to time delayed or cost added.

Risk and issues register

Operate  a strong risk and issue register,  ensure  it is both visible  and assessable so  your team can  actively participate in updating it.

Stop  the project

Always remember, cancelling the project is not always a failure. There can be many reasons why the project may no longer be desirable now. If you have done your job well, you can be really successful by ensuring a project does not continue to meander along, wasting time and money when there is no possibility of completing the project.

Organisational change management

Unfortunately, the same can’t be said when there are organisation change management issues.   While there are a  few project managers who feel their jurisdiction ends at the triple constraint, most now  understand the need to achieve the expected benefits from their projects.

So when is it fair to blame a project manager for poor implementation of a  project’s deliverables,  this is assuming that they were employed at the beginning of the project?

  1. If they didn’t perform good  stakeholder analysis during the project initiation stage as well as at regular intervals.
  2. If they turned a blind eye and deaf ear to factors that could impact value achievement
  3. If they didn’t insist on a clear communication strategy and progressive information sharing with relevant  stakeholder groups.
  4. If they didn’t engage influencers from key stakeholder groups throughout the project lifecycle.
  5. If the organisation management deliverables were not built into the project’s scope definition and work breakdown structure.

Assuming the project manager was appointed at the start of the project and had undertaken  all of the above, what are invalid reasons to blame the project manager  if the project failed?

  1. A lack of timely resource availability or commitment by the organisation
  2. Directives to the project manager to not engage certain stakeholder communities
  3. Ignorance by senior sponsors to management risks raised by the project team
  4. A management decision  that is too bitter a pill to swallow in spite of how much it has been sugar coated

Have any comments or stories that could help to expand this article?

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34 Thought Provoking Change Management Quotes

Change is good. It’s also often hard. The status quo can be so much more comfortable. But to succeed in business, you must run toward change.  Companies most likely to be successful in making change work to their advantage are the ones that no longer view change as a discrete event to be managed, but as a constant opportunity to evolve the business

Here are 34 thought provoking change management quotes:

  1. It is not the strongest or the most intelligent who will survive but those who can best manage change —  Charles Darwin
  2. One key to successful leadership is continuous personal change. Personal change is a reflection of our inner growth and empowerment — Robert E. Quinn
  3. Change before you have to — Jack Welch
  4. You must embrace change before change erases you.
    — Rob Liano
  5. Change before you have to — Jack Welch
  6. Too few leaders have the emotional fortitude to take responsibility for failure.
    — Paul Gibbons, The Science of Successful Organisational Change: How Leaders Set Strategy, Change Behaviour, and Create an Agile Culture
  7. People don’t resist change. They resist being changed! — Peter Senge
  8. If you want to make enemies, try to change something — Woodrow Wilson
  9. The key to change is to let go of fear — Rosanne Cash
  10. The world hates change, yet it is the only thing that has brought progress — Charles Kettering
  11. There is nothing more difficult to take in hand, more perilous to conduct, or more uncertain in its success, than to take the lead in the introduction of a new order of things — Niccolo Machiavelli
  12. Change is the law of life and those who look only to the past or present are certain to miss the future — John F. Kennedy
  13. Even those who fancy themselves the most progressive will fight against other kinds of progress, for each of us is convinced that our way is the best way.
    — Louis L’Amour
  14. Whosoever desires constant success must change his conduct with the times — Niccolo Machiavelli
  15. Your success in life isn’t based on your ability to simply change. It is based on your ability to change faster than your competition, customers and business — Mark Sanborn
  16. Change your thoughts and you change your world — Norman Vincent Peale
  17. If you don’t like change, you will like irrelevance even less —  General Eric Shinseki (U.S. Army Chief of Staff, 1999-2003)
  18. We now accept the fact that learning is a lifelong process of keeping abreast of change. And the most pressing task is to teach people how to learn — Peter Drucker
  19. Whosoever desires constant success must change his conduct with the times
  20. — Niccolo Machiavelli
  21. All is connected, no one thing can change by itself
    — Paul Hawken
  22. Learn to adjust yourself to the conditions you have to endure, but make a point of trying to alter or correct conditions so that they are most favorable to you — William Frederick Book
  23. We would rather be ruined than change
  24. We would rather die in our dread than climb the cross of the moment  and let our illusions die  — W. H. Auden
  25. Every generation needs a new revolution  — Thomas Jefferson
  26. Never doubt that a small group of thoughtful, concerned citizens can change the world. Indeed it is the only thing that ever has  — Margaret Mead
  27. I’ll go anywhere as long as it’s forward  — David Livingstone
  28. Life isn’t about finding yourself. Life is about creating yourself  — George Bernard Shaw
  29. Adaptability is about the powerful difference between adapting to cope and adapting to win— Max McKeown
  30. You can’t build an adaptable organization without adaptable people–and individuals change only when they have to, or when they want to — Gary Hamel
  31. People will try to tell you that all the great opportunities have been snapped up. In reality, the world changes every second, blowing new opportunities in all directions, including yours — Ken Hakuta
  32. A wise man adapts himself to circumstances, as water shapes itself to the vessel that contains it — Chinese Proverb
  33. The price of doing the same old thing is far higher than the price of change — Bill Clinton
  34. Each of us has the opportunity to change and grow until our very last breath. Happy creating — M.F. Ryan

Change or die? we  choose life! How about you?  

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Playing God: Swedish Train operator uses Big Data to ‘avoid train delays that haven’t happened yet’

In a sign of things to come, a Swedish train operator is using new technology that employs big data to predict the entire commuter train system two hours into the future.

Welcome to the world of “Big Data.” We have more information at our fingertips than any generation in history. We live in the world of “Big Data.” That is the new way people are trying to describe this sea of digital facts, figures, products, books, music, video, and much more. Twitter, apps, Facebook–they’re each giving science new ways to look at what people do and why.

“Hopes, fears, and ethical concerns relating to technology are as old as technology itself.”

We actually welcome some aspect of Big Data. These mysterious data successes (or accidental successes) are easy to see as a kind of Big Brother future, where technology can track your every move and report back to ”¦ someone. However, StockholmstÃ¥g, the train operator is using new technology that employs big data to predict train delays before they happen.

“The Commuter Prognosis –  A Social Scientist’s Dream Come True.”

The mathematic algorithm, called “The commuter prognosis” was  developed in Stockholm, Sweden.

When a train is not on time the algorithm forecasts disruptions in the entire network by using historic big data  to  prevent the ripple effects that actually causes most delays.
Wilhelm Landerholm the mathematician who has developed the algorithm said:

“We have built a prediction model, using big data, that lets us visualize the entire commuter train system two hours into the future. We can now forecast disruptions in our service and our traffic control center can prevent the ripple effects that actually cause most delays.”

The algorithm has been tested but is not currently being  used by traffic controllers.

How  does it work?

The key to the model is a large  amount of historical data. The model works similar to a seismograph, an instrument that measures and records details of earthquakes, such as force and duration, but instead identifies late train arrivals. When this happens, the system  uses historical data from previous occurrences to forecast the likely  impact on the entire train network.

Real-time public transportation information is already used around the globe, however, traffic control centers still typically assess  delays manually to try and prevent further problems in a network. The commuter prognosis system, on the other hand, will forecast these delay effects instantaneously  and provide a prediction of how a single or multiple  disturbance might  affect  the whole  train network. The  commuter prognosis system could change how traffic control centers operate all over the world.

“The Effects of One Delayed Train Can Quickly Multiply Within a Train Network”

Imagine that “The commuter prognosis” forecasts that a train will be 10 minutes late to station C in two hours. To deal with this the traffic control center issues a new train from station A that will arrive on time at station C. As soon as the new train has been put in motion the algorithm re-calculates and gives the traffic control center a new forecast for the entire train network within minutes.”

The most important benefit of “The commuter prognosis” is that it  provides for a more punctual public transportation.

“The commuter prognosis” will be available in a smartphone app based on the original model. The app will integrate with other transportation big data to make commuting easier and  will indicate which coaches are more or less crowded.

Big Data, Ethics, and Religion

These stories remind us that even though companies and governments are doing amazing things with data, it’s at best imperfect. The algorithms and programs they use to filter and respond to data are at least as fallible as the human beings who designed them.  We can also see its complexity and failures as evidence of the amazing omnipotence of our God – who doesn’t make errors and who knows right where to find us, even inside a great fish or the depths of hell.

The arrival of big data has already brought with it numerous questions that have yet to be properly addressed. These questions are methodological, epistemological, and ethical, and they concern (inter alia) the ways in which data is collected, stored, interpreted, represented, and traded.  A further complication is a speed with which data science is advancing, which means that (for example) the application of legal and ethical restrictions to the practice of that science will always risk being several steps behind the point that it has currently reached. There are indications that we are currently sleepwalking towards a situation in which the commercial exploitation of big data routinely increases social division, and renders privacy a thing of the past.

Ket factors

  • A mathematical model interprets big data to forecasts for each train in the train network.
  • The commuter prognosis can warn about delays two hours before the departure or arrival actually takes place.
  • The commuter prognosis calculates how the delay affects other trains in the system.
  • The purpose of “the commuter prognosis” is to make life easier for traffic control centers and to give passengers  a better service.
  • In the future, the algorithm will be potentially adaptable for more types of public transportations and cities.
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New Urban Homes

New Urban Homes

A 3-dimensional system involving modules or pods which is the basic building block of much prefabricated construction. Several designers are experimenting with making this form adaptable to more than apartments. The majority of new high-density developments in London provide only flatted accommodation and ignore the needs of families. While the argument for more homes at a higher density is understood, should this policy exclude families? And what sort of city would London become?

For the past three years the architects have been examining opportunities for high-density urban family housing on a number of initiatives in Southwark, Ealing and Harrow. Using modular construction techniques the ‘courtyard’ homes deliver more space for less cost. Arranged in typical urban blocks and at no more than three storey densities they produce some 80 dwellings per hectare.

The house delivers flexible open plan ground floors with circulation spaces that are naturally lit. With both a courtyard and an upper terrace each house benefits from at least 40m2 of external space. More importantly this space is entirely private to the dwelling and is directly related to the kitchen, living and bedroom spaces. These are external rooms, a far cry for a patch of green, sandwiched between close boarded fencing and overlooked by the neighbours.

New Urban Homes
New Urban Homes IMAGE CREDIT: PROCTOR AND MATTHEWS
Courtyard and covered entrance view IMAGE CREDIT: PROCTOR AND MATTHEWS

The five steel modules required for each house are delivered on low loaders and craned onto preprepared footings. All modules are fully fitted-out in the factory. The technology allows different fenestration arrangements, cladding options and roofing forms.

Architect: Proctor and Matthews
Principal Supplier: Spaceover

 

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