Digest

Dan Richard, a veteran transport executive, joined the board of the California high-speed rail authority and quickly learned that mega projects like high-speed rail are often plagued by cost overruns and delays. He discovered that the project was victim to what Bent Flyvbjerg, a professor at Oxford University and IT University of Copenhagen, calls the "iron law of mega projects." Flyvbjerg's research has shown that 99.5% of mega projects are over time, over budget, or have lower benefits than expected, often a combination of these things. Flyvbjerg's research has uncovered a few lessons that mega projects like high-speed rail could learn from. The first lesson is the importance of actual experience in the exact type of project. Experience makes a difference, and often this is disregarded when talking about project leadership. Flyvbjerg points out that there are no modern high-speed rails in the US at the moment, so essentially there's no experience building those in this country. He's particularly critical of the California high-speed rail project for not awarding contracts to overseas companies with experience. They didn't hire the people who were planning to build high-speed rail lines before, they decided to reinvent the wheel. Another lesson is to think slowly before acting fast. The Sydney Opera House, which had a 1,400% cost overrun and was 10 years delayed, is a prime example of what not to do. In contrast, the Guggenheim Museum, Bilbao, in Spain, is a prime example of what to do. It was one of those rare mega projects that was delivered on time, under budget, and put the city on the tourism map. The Guggenheim Museum, Bilbao, looks like a glorious tangle of metallic curves, and it's like a kid's cardboard cut-out model brought to real life in the best possible way. This is the signature style of its architect, Frank Gary, who was then in his 60s. By contrast, the architect of the Sydney Opera House was not very experienced, and it makes an enormous difference. The Sydney Opera House suffered from political pressure to just start building, to put that shovel in some dirt before proper planning had been completed. But for the Guggenheim, Frank Gary knew he needed to invest substantial time in that preparation. Gary and his team spent two years tweaking his new design and moving it to a detailed digital simulation. The third lesson is to make friends and keep them friendly. Dan Richard visited one city in Northern L.A. where the high-speed rail line was proposed to cut through. The proposed alignment was right next to schools, and there were thousands of homes and businesses that would have to be displaced. Richard finally just said, "This is just not workable." Instead, now a 22-mile tunnel is planned under that city. Ben says this kind of community engagement and stakeholder management is critical, especially for sprawling projects like high-speed rail. The plans have changed a lot over the years and costs have risen further now. The plan is for the high-speed rail to open in the first phase between the rural cities of Bakersfield and Merced, but that could be as late as 2033. It's a compromise after decades of wrangling between communities, politicians, engineers, and environmental advocates. Successful leaders tackle this head-on. They invest a lot of time in meeting with community groups and stakeholder groups and making sure that they understand how they see things and they make sure that they think of measures that might be attracted to those stakeholders so that you can get some kind of consensus.

Outlines

00:00:00

Introduction

This Chapter introduces the topic of building big projects, specifically focusing on the challenges and lessons learned from the California high-speed rail project.

00:00:13

Dan Richard's Involvement

This Chapter details Dan Richard's involvement with the California high-speed rail project, starting with his initial reluctance to join the board and his eventual acceptance of the challenge.

00:01:07

The Iron Law of Mega Projects

This Chapter introduces Bent Flyvbjerg's research on mega projects and his discovery of the "iron law" that most projects are unsuccessful due to cost overruns, delays, and lower benefits than expected.

00:03:32

Lessons from Mega Projects

This Chapter explores the lessons learned from mega projects, emphasizing the importance of experience, planning, and stakeholder management.

Keywords

Q&A

• What are some of the challenges faced by mega projects like high-speed rail?

  Mega projects often face challenges such as cost overruns, delays, and lower benefits than expected. These challenges can be attributed to factors such as lack of experience, poor planning, and inadequate stakeholder management.

• What is the "iron law of mega projects" and what does it tell us about the success rate of these projects?

  The "iron law of mega projects" is a term coined by Bent Flyvbjerg to describe the pattern of cost overruns, delays, and lower benefits than expected in most large-scale projects. Flyvbjerg's research shows that 99.5% of mega projects are over time, over budget, or have lower benefits than expected, often a combination of these things.

• What are some key lessons that mega projects can learn from to improve their chances of success?

  Key lessons include the importance of actual experience in the exact type of project, the need for thorough planning and preparation, and the critical role of stakeholder management in building consensus and addressing potential conflicts.

• How does the Sydney Opera House serve as an example of what not to do when building a mega project?

  The Sydney Opera House is a prime example of a mega project that faced significant challenges due to lack of experience, poor planning, and political pressure to start construction before proper preparation. It resulted in a 1,400% cost overrun and a 10-year delay.

• How does the Guggenheim Museum, Bilbao, demonstrate the importance of planning and experience in mega projects?

  The Guggenheim Museum, Bilbao, is a rare example of a mega project that was completed on time and under budget. This success can be attributed to the experience of its architect, Frank Gehry, and his commitment to thorough planning and preparation.

Show Notes