You are never in control but you can always manage

My lecture of Monday October 8th focused on project failure.
Isn?t it strange that a large amount of large scale (building and infrastructural) projects fail and run over budget and time? And according to the Oxford handbook; over and over again.
The answer is given in chapter 13 by professor Flyvbjerg from Denmark.
Flyvbjerg executed long and thorough research on this problem and out of his research came a simple conclusion. The real causes behind project failure are ?Optimism Bias? and ?Strategic Misrepresentation?. He called these the root causes of projects failure. The first cause being of psychological origin and the second is political driven.
I am sorry we did not have the time to dive deep into solutions to the root problems.
This is the reason for this post.
The causes behind project failure seem simple. There are only two!
It would be great if solutions were simple as well!
Let?s look at the solutions.
To give you more of a hold on the system behind project failure and its solutions, I made the above drawing. The solutions are discussed in the mentioned chapter as well and represented in the grey windows of my drawing. According Flyvbjerg solutions are:
1. Organize dissenters. (I mentioned this during my lecture)
2. Build a strong team and try to work on openness and transparency to fight the Principal Agent problem. (I mentioned Sense making as a solution)
3. Introduce reference class forecasting in making plans, schedules and budget calculations.
4. Introduce other incentives. (That is; awarding those that make realistic plans and punish the ones that try to lie)
Could this be easy to do?
I will ? only shortly – elaborate on it.
1. A lot of people find it hard to deal with feedback. So dissenters are not always welcomed with open arms by a team.
2. You are not always able to change the composition of your team, and teambuilding or regaining trust is difficult and It takes time.
3. Reference class information is not always available.
4. Changing incentives on behavior is never part of your project but part of the culture of organizations you work with.
I hope you got a good impression of the problems in complex or mayor projects, but I hope I did not frighten you, because working on project is challenging and a lot of fun.
And another psychological habit of mankind is to forget problems of the process and love the result. The Sidney opera house, with a 600% budget overrun, is loved by its citizens. Nobody talks about the budget overrun nowadays. The same will happen with the Amsterdam subway. When it runs through the city I am sure most people will be glad and proud.

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