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Oct 15 2014

Megaprojects: Mega-challenges for project controls

East Village Few projects proceed like clockwork and it is probably fair to say that the bigger and more complex the project, the more likely the project team is to encounter problems. In pursuit of control over big projects, the take-up of SaaS construction collaboration platforms has flourished.

Project Controls in normal projects

Teams working on small projects often only needed a simple file-sharing system to help them communicate as they would tend to comprise a small group of people all undertaking familiar tasks well within their competence. In the early days of UK construction collaboration, we identified that the demand for more sophisticated collaboration started with projects and programmes worth over £1m. Often such project teams were multi-disciplinary, fragmented, rarely (if ever) co-located, and sometimes transient, with some companies and their people only involved briefly. The need for a centralised repository of information, a secure and transparent ‘single version of the truth’, along with good process management structures, generally proved invaluable in such dynamic teams. And the teams themselves also have to be committed to working in a more collaborative way.

How Project Controls challenges of London Olympics 2012 were met to deliver an on time completion

Megaprojects are defined as those undertaken on an extremely large scale, and costing project values of hundreds of millions of pounds. When dealing with such projects the challenges are mega-sized, and because such projects are often subject to intense industry and public scrutiny, the impact of failures are significant, as are the costs. Accordingly, megaprojects require a more stringent and sophisticated approach to project controls and change management processes. At CONJECT, we have seen this many times.

Take the 2012 London Olympic Games and Paralympics, for example. Our client, Bovis Lend Lease was the main contractor for the Athletes Village in Stratford, a £1.1 billion, five-year project that was critical to the success of the Games. The village, arranged on 16 plots, was to house the competing athletes and associated support staff during the summer of 2012, and the facilities would afterwards be modified to provide much-needed housing in the heart of east London.  Budget overruns were out of the question – the world was still struggling with the impacts of the Global Financial Crisis. There could be no programme delays – the village absolutely had to be ready in time for the start of the Games. And it was vital to ensure high quality facilities were delivered – this was a huge opportunity for UK construction to showcase its abilities.

CONJECT provided the information management system that helped Bovis Lend Lease and its supply chain deliver the Athletes Village, supporting 4,172 users who, during the course of the project, logged in to the platform over 822,000 times. A sense of the volume of changes involved comes from our stats relating to financial control. There were 13,536 trade contract variations (notices of cost discrepancies versus forecast) raised between Lend Lease and its contractor supply chain which were logged, reviewed and resolved during the project lifecycle. 

When megaprojects go wrong

Not all megaprojects are run so efficiently. Take the Panama Canal, for example. Recent investment in the Canal, a vital shipping route connecting the Atlantic and Pacific Oceans, included a $3.2 billion project awarded in 2010 to expand locks, making them longer and wider, and allowing the waterway to double its shipping capacity by 2025. The locks were due for completion by 2014 (the 100th anniversary of the canal’s original opening), with design and construction by a multi-national team of contractors and consultants from across the Americas and Europe.

The project has not run smoothly – the Economist reported in August 2014 that the locks project had been delayed at least 12 months due to technical problems with cement and machinery at the new locks, while a dispute about cost overruns caused work to stop for more than two weeks in February. According to the BBC, the cost overruns amount to $1.6 billion; the canal expansion project is now expected to finish in early 2016. This is despite the project being supported by a “neutral, externally hosted platform for overall collaboration… helping to capture a comprehensive picture of the project”.

It is a clear demonstration that, despite setting out to deliver transparency and collaboration, technology alone cannot prevent cost overruns, delays, expensive legal disputes and damage to reputations. Just as it’s always been: successful collaboration is 20% technology, 80% people and process.

 

Related blogs:

Successful supply chain management at Heathrow T2 Retail

Project Controls credentials showcased at London Expo

Integrated Project Control – a primer

 

About the author

Steve Cooper

Steve Cooper is Managing Director of Conject Ltd. He has spent over 25 years within the construction and engineering software markets, successfully running sales and marketing teams. He spent a number of years at SAP within their E&C practice, set up and managed a distribution channel in Asia Pacific for a division of Misys and ran a sales and marketing team within CSB COINS. In 2000 he gained an MBA from Henley Management College.

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