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From high-speed rail to the Olympics, why do major projects go wrong?

largeOther countries Owning massive construction projects that have become synonymous with incompetence. In the U.S., “Big Dig,” a freeway project roaring through downtown Boston for years, was five times over its original budget. The stadium built for the 1976 Montreal Olympics was affectionately dubbed the “Big Arrears” after cost overruns; the Olympic debt was not paid off until 30 years later. Even the Germans got big projects wrong. In 2006, Berlin Brandenburg Airport broke ground and the first flights took off in 2020, a decade later than originally planned.

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The embarrassment caused by Britain’s largest construction project will last for years.A plan to build a high-speed railway known as the HS2, England’s spine was approved by the government in 2012. Another in a series of delays was confirmed this month. Now, with luck, the first passengers will only be able to board the ship sometime in the 2030s. Costs have doubled from original estimates; parts of the route have been axed; and trains won’t be moving as fast as originally planned.

large projects such as HS2 is the subject of an interesting new book, “How Big Things Get Done,” by Oxford academic Bent Flyvbjerg and journalist Dan Gardner. Mr. Flyvbjerg is the compiler of a database of more than 16,000 projects that tells a grim tale of missed deadlines and busted budgets. He estimates that only 8.5 percent of projects meet their original cost and time estimates, and a measly 0.5 percent of projects meet their stated goals in terms of cost, time and benefits.

Mr Flyvbjerg’s proposal does not guarantee success: his team is involved in evaluating and HS2. But the picture he and Mr. Gardner paint of why projects large and small often go wrong is compelling.

Overly optimistic time and cost estimates stem from psychological and political biases: reliance on intuition rather than data, and what Mr Flyvbjerg and Mr Gardner call “strategic misrepresentation”. This is when budgets are deliberately lowered to make things work, on the premise that if the politicians walking around is accurate, nothing gets built. The sunk cost fallacy, where people are hesitant to stop a project because the money spent seems to have been wasted, means that once the work starts, the plug is rarely pulled.

Plans are often rushed. The author praises Pixar’s methodical approach to detailed development and testing of the film before it goes into production. They also tell the story of how Frank Gehry’s meticulous architectural models helped ensure the Guggenheim Bilbao’s success. By keeping windows to a minimum when the project is actually being implemented, careful planning reduces the chances of unexpected events spoiling things.running man HS2 seem to disagree. In theory, the recent delays allow the UK government to spend less each year; in practice, they only increase the risk of more things going wrong.

Large custom projects are especially prone to trouble. The more a project can be broken down into replicable processes, the better its prospects. Mr Flyvbjerg’s database shows that solar and wind installations are the most likely to go wrong, in part because standard components can be snapped together to form arrays and turbines. At the other end of the risk scale are huge one-off efforts, like nuclear power plants and the Olympics.

It is possible to mitigate the dangers inherent in large custom projects. Some believe the future of nuclear energy lies in modular reactors. Paris is the host city for next year’s Summer Olympics, and most of the stadiums are using existing facilities. Standardized design and manufacturing processes, from train tracks to viaducts, helped China build the world’s largest high-speed rail network in less than a decade in the early 2000s.

Projects run into problems for specific and general reasons: the quagmire of UK planning rules, for example, is not something China has to worry about. The timelines, reviews and goals for large public infrastructure projects differ from corporate plans. But here are lessons that managers of all types can learn. If you plan rigorously and standardize as much as possible, you’re less likely to get bogged down.

Read more from Bartleby, our columnist on management and work:
A Little Relief for Office Woes (March 9)
The Use and Abuse of Hype (March 2)
The ability to keep a low profile has both advantages and disadvantages (February 23)

Plus: How the Bartleby column got its name

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