Analysing the problem
Over the last few years, major infrastructure projects in the UK have been delayed, changed in scope, or cancelled entirely. Ultimately, these delays drive up costs for the taxpayer, deter investment and harm the UK’s global reputation as a place to do business.
There is no shortage of guidance on how to achieve best practice in the development and delivery of major infrastructure projects. Each year, at least one major guide is produced by government or industry bodies, whilst universities and practitioners publish scores of articles on the subject. Yet, despite the overwhelming output of advice, we continue to struggle to deliver projects to time, budget or desired quality. And the larger or more complex the project, the greater the problem.
We not only fail to deliver projects; we also fail to plan and design them effectively, with the vast majority of appraisals and initial cost estimates being wildly over optimistic. Two of the most recent major rail projects in the UK have experienced well documented problems. Crossrail was delivered three years late and £3.4bn over budget, while HS2 was criticised by the National Audit Office for Euston Station plans that are currently forecast as being almost double the proposed budget. The construction of Euston, having commenced before a workable solution was produced, has now been paused.
Project failings are not just limited to design, construction, and cost management. Research estimates that over 90% of major projects fail to deliver their projected benefits, whilst cost-benefit analyses also consistently over-estimate the benefits. We routinely over-estimate benefits that projects are expected to deliver and this effectively means that the business cases upon which most major projects are based are inherently flawed.
We appear to consistently ignore our own advice, overlook the numerous best practice guides, and make the same mistakes repeatedly. However, there are a minority of projects that do not fail and are delivered to time and budget and which proceed to generate the forecast benefits. Analysis of successful projects reveals that they consistently follow best practice (mutual outcomes, clarity of objectives, good integration, risks mitigated before final costs agreed). And from this, it can be assumed that ‘best practice’ itself works, if applied. The problem seems to be that the majority of major projects fail to follow best practice.
Unlocking success through systems methodologies
Best practice in construction and infrastructure delivery is well researched and documented, yet the delivery of major projects consistently demonstrates a failure to deploy this learning. Many of the concepts underpinning best practice in infrastructure are derived from systems thinking, however these are largely recommended as discrete, standalone ideas and not as part of recognised systems methodologies. This is likely to be a significant factor in the continued poor performance of the majority of major projects and the failure of systems concepts to address this.
A methodology provides structure to an activity, ensuring that the required stages and steps are correctly implemented, and that the activity is integrated, both internally and with aspects of its environment. A methodology therefore increases chances of success, prevents waste of time and effort, eliminates unnecessary actions, and ensures consistent reporting and analysis. It also ensures that an activity is replicable and therefore supports learning and continuous improvement.
It can be argued that in order for best practice tools and techniques to be effectively and successfully implemented, systems methodologies should be deployed as the framework for project and framework management. Just as a system is an integrated set of components, acting together to achieve an outcome, a systems method requires a whole series of components, tools, and techniques to act together in a purposeful and structured way.
Furthermore, it can be argued that the tools and techniques are far less important than the understanding of the project or programme as a system, thinking in terms of systems behaviours and recognising the holistic, multi-dimensional nature of the challenge. It is this understanding that will allow managers to select the most appropriate tools, according to context and circumstance. Working within the framework of systems methodologies cultivates such an understanding.
Learning the lessons for UK infrastructure
There are beacons of success to guide the UK infrastructure sector on this journey. Systems methodologies have been in use since the mid-part of the last century. They are widespread in some technical sectors, such as IT and are well established in management science and its practical applications. Seventy years ago, the Apollo programme demonstrated systems thinking and applied methodologies on a variety of levels. The manufacturing sector has also developed various systems methods to deliver efficiencies and the development of highly complex technology products. LEAN is deeply rooted in systems thinking with Toyota widely recognised as the role model and one of the most highly developed examples of the potency of systems thinking and action learning.
The size and complexity of major projects means that success rests on effective working across a broad range of project activities. Success also requires that various aspects of projects are integrated and aligned. This requires the coordinated use of a range of systems concepts spanning planning, design, construction, and commissioning. Systems methods exist to provide such a coordinated framework.
For example, the Apollo programme illustrates how the ‘Hard Systems Engineering’ method links clarity of objectives, to option selection, success measures, fine tuning of designs - via value engineering - and feedback loops to verify and validate progress against the desired outcomes. The Product and Cycle-time Excellence (PACE) methodology organises people, resources, and processes in order to improve production and enhance the product development cycle in high-tech manufacturing. This is achieved via integration of key sub-systems around a common purpose and by establishing feedback loops to verify progress and underpin continuous improvement. The ‘Soft Systems Method’ deals with less structured problems where goals may be obscure and the components of the problem undefined.
There is growing evidence from recent rail projects in the UK that improved integration across planning, design, and delivery - and ongoing operations and maintenance - significantly improves the chances of achieving outcomes, capturing intended benefits, and delivering to time and budget. Systems thinking and methods have a key role to play in establishing the contracting and delivery structures to achieve these benefits.
Leadership, management and education
Adoption of systems thinking and, most importantly, systems methods, has the potential to improve the performance of large and complex infrastructure projects. In our experience, there are three key features that help drive this focus on outcomes.
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Leadership: On our transformative project modernising the Core Valley Lines as part of the South Wales Metro, credit must go to Transport for Wales for setting up the project from day one as a system, seeking solutions that delivered true outcomes for the travelling public and the public purse – highest service frequencies, lowest journey times, best train and station environment and true sustainability. Technology was vital but the focus was on the required outcomes so when, for example, the budgets were tightened, value engineering retained the outcomes that really mattered.
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Management: When we used a systems approach to manage Scotland’s Forth Bridges it required a total reboot of the culture normally associated with the management of complex assets. By breaking down the siloes that existed around maintenance, operations, monitoring, policing, planning, and community engagement to embrace a new systems approach, we were able to transform the way these assets were managed. The bridges now stay open longer in bad weather and are closed less for essential maintenance because we understand the need to focus on the social and economic outcomes that drive the use of the assets. We are able to predict and prevent infrastructure failure, saving the taxpayer millions of pounds.
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Education: Through our degree apprentice programmes we are increasingly working with universities to teach systems engineering, a discipline which has in many ways become unfashionable and subsumed by other topics. A systems approach helps to widen that thinking to include the many more elements that make up overall outcomes, allowing our project managers to vary their management style to suit.
To conclude, making the necessary changes to achieve greater success in project and programme delivery does not require new tools or techniques. It will require that existing concepts are applied within structured systems methodologies. Change will be achieved through leadership, management, and education. As such, the keys to success lie within systems thinking.