Presentation on theme: "The Big Dig: Managing Risk and Complexity on Mega Projects Presentation to PM Connect Thursday, December 15, 2011 Virginia A. Greiman, Assistant Professor,"— Presentation transcript:
4 Why are Mega Projects Consistently Underestimated? A review of large public works projects over the last century concluded that costs are consistently underestimated, a phenomenon attributed to the desire of the project advocates to have their projects approved.(Flyvbjerg, Megaprojects and Risk: An Anatomy of Ambition, 2002)
5 National Transportation Research Board 2006 Cost Estimation Report Identified 8 Strategies linked to 18 different causes of cost escalation on highway projects in the United States.Notably, the research concluded that most efforts in cost estimation have focused on creating tools to improve cost estimates with less emphasis on tools for cost estimation management.(Anderson et. al. 2006).
8 Major Complexity Challenges on the Big Dig: Project Integration – (150 Major Employers – One Team) 5,000 workers, thousands of complex processesRisk Management – World’s Largest Wrap-up ProgramTechnology Integration – Monitoring the Critical PathClaims and Changes - Partnering
9 Project Integration Management CloseProject7Project Charter1ScopeStatement2Integrated Change Control6ProjectMgmtPlan3MonitorAnd Control5Direct and ManageExecution4Project Management Institute, PMBOK, 4th ed.
17 Lessons from PracticeSource: Central Artery Tunnel Project, Photo of Fort Point Channel
18 Classification of Catastrophic Loss NaturalEconomicTechnologyHuman
19 Major Catastrophic Losses Event Estimated Loss ($MM) Hurricane Katrina (2005) $43B-$60B World Trade Center (2001) $30-40B Earthquake in Chile (2010) $30B ($8B insured) Hurricane Andrew (1992) $18B California Earthquake (1994) $12.5B Hurricane Hugo (1989) $ 4.2B Japan Typhoon Murielle (1991) $ 6.4B Hurricane Georges (1998) $ 2.9B Hurricane Floyd (1999) $ 2.0B Oakland, CA fire (1991) $ 1.7B IRA Bombing, London (1993) $ 1.0B Source: Lloyds, Munich Re, Swiss Re
21 Risk Analysis Events and Condition Chart What? How? And Why? Worker Makes ErrorDown-grading Changes OccurWorker Fails to Adapt to ChangesHazardousSituationDevelopedIncident OccurredU.S. Dept. Of Energy Events and Causal Factors Analysis, Root Cause Analysis is any analysis that identifies underlying deficiencies in a safety management system that, if corrected, wouldprevent the same and similar accidents from occurring.Accident Occurred
22 Big Dig Safety and Health Programs and Practices Substance Abuse and Prevention ProgramZero Accident ToleranceContinuous Improvement PracticesTraining and Best PracticesCommunityInvolvementProgramOwner Controlled Insurance ProgramSafety Incentive Program (SHARE)Shared ResponsibilityMitigationProgramThink about the roles of a PM - is there anything they don’t have to get involved in?To debrief: first ask the class to compare their list of roles to the above list. Then summarize the common roles and then ask each group to address a unique role (or one of the common ones if they don’t have any unique ones)Now that we have the class’s view, take a quick look at pages Do you see anything that we didn’t cover?1,344Environmental CommitmentsPublic ImageThreat AssessmentAbutter ProgramAnd many more…Emergency Response
23 Recordable Rate People Rate 5000 4500 4000 3500 3000 2500 2000 1500 Peak Manpower/YearRateActuals per year50004500400035003000250020001500500National Average