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Theory of Management of Large Complex Projects

  • Strategic Program Management LLC

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The essence of the “Theory of Management of Large Complex Projects’ can be captured in three central thoughts. First, that project readiness is a good but not sufficient first step in the broader project initiation process. Project readiness typically presupposes that the owner’s organization is itself ready to undertake the project. This is more often than not, not the case. Second, that the classical theory of project management which focuses on the “transformational” processes which occur in discrete activities, strung together such that the output of one or more is the input to others, is no longer adequate in considering large complex projects. This activity based focus, memorialized in work breakdown structures, neglects the importance of “flows” within the project context. As we more tightly link supply chains into project processes, we begin to see some of the flow considerations that are core in the realm of logistics as being analogs for efficient project management. Precedence’s and unnecessary coupling of activities may harm a project’s performance in ways that may not be evident on initial inspection. Additionally, these flows are no longer static or predictable. Third, a core underlying premise that projects are “bounded” is breached in the world of large complex projects. Rather than well defined boundary limits we discover semi-permeable boundaries across which “influencing flows” transit, impacting the transformational flows within the project proper. These flows arise from a multiplicity of stakeholder’s and other agents who in turn are influenced by the project itself.
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In his book, The Improbability Principle, David Hand, former president of the Royal Statistical Society, provides a tour de force treatment of uncertainty and how improbable events happen, over and over again. It is a highly recommended read but not for the faint of heart. In this Executive Insight the lenses described by Hand are used to look at large projects and their unacceptably high failure rates. Application of best practices would suggest these failures should be improbable or at least less frequent than reported failure rates suggest. If the industry repeatedly experiences the improbable, it is perhaps better that the improbable be understood. This will only become more important as our projects and their settings become ever more complex. The lenses can best be described as comprising a set of laws. Each will be examined here and how they shape the views on the failure of large projects.
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A growing world requires improved and expanded infrastructure. Juxtapose that with the need for massive public investment driven by pandemic created economic weakness and the prospects for significant investment in infrastructure is improved, but as history has taught us not necessarily assured. We have been through other infrastructure stimulus programs focused on so-called shovel ready projects and have been disappointed. But whether we define them as "shovel ready" or otherwise we need infrastructure projects, especially the largest of them, to be successful. In this paper we will look at common reasons large scale infrastructure projects fail and importantly suggest some strategies and tactics to improve their success rate. The observations are based on the author's experience in reviewing, troubleshooting and overseeing over one hundred billion dollars plus projects. The extensive end notes are intended to give the reader the opportunity to explore specific items more fully. Framework for considering large scale infrastructure projects Over the course of the author's work, he has drawn certain views as to how we should think about and consider projects such as the large-scale infrastructure projects which are the subject of this paper. Much has been written by others on why large infrastructure projects fail ranging from optimism bias to strategic deception and that is not reviewed here. The author's framework is founded on the following core observations: • Project management theory (classical PM theory) as promulgated by Gantt and Fayol fails at scale and complexity. These are the very characteristics of large complex infrastructure projects. • A neo-classical PM theory is required that addresses the challenges of scale and complexity such as that exhibited by large complex infrastructure projects. This new theory of project management must: 1 How to cite this paper: Prieto
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This Executive Insight looks at large complex programs from a systems perspective recognizing that such programs are not as well bounded as classical project management theory, as espoused by Taylor, Gantt and Fayol , would have us believe. Rather, they behave in both independent and interconnected ways in a dynamic systems environment. They demonstrate the evolutionary nature of all complex systems. They face uncertainty and emergence that comes with human actions and interactions. Large complex programs struggle from insufficient situational awareness, treating the program to be more well-bounded than reality would suggest and using simplified models to understand the complexity inherent in execution. Best practices from project management were typically not derived from such environments and, worse, have fallen short on other large complex programs. Large complex programs are characterized by boundaries that change in response to changing environments; emphasize coping with challenges and change; go beyond uncertainty and require a change in perspective; face a high level of unknown unknowns and unclear/incompatible stakeholder needs. Systems theory represents a different way of seeing, thinking and acting Systems are viewed as greater than the sum of their parts. A system’s holistic properties can never be completely known. Different perspectives will provide different views that may overlap and not be completely compatible.
This paper is an overview of the author's ongoing reflections on the need for a new paradigm of complexity capable of informing all theories, whatever their field of application or the phenomena in question. Beginning with a critique of General System Theory and the principle of holism with which it is associated, the author suggests that contemporary advances in our knowledge of organization call for a radical reformation in our organization of knowledge. This reformation involves the mobilization of recursive thinking, which is to say a manner of thinking capable of establishing a dynamic and generative feedback loop between terms or concepts (such as whole and part, order and disorder, observer and observed, system and ecosystem, etc.) that remain both complementary and antagonistic. The paradigm of complexity thus stands as a bold challenge to the fragmentary and reductionistic spirit that continues to dominate the scientific enterprise.
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