The art of project leadership: Delivering the world’s
largest projects
·
Four
mind-sets and eight leadership practices distinguish successful leaders of
ultralarge projects.
Today, the very largest and most complex projects
command budgets exceeding $5 billion and require more than five years for
design, planning, and construction. The sheer scale of such projects brings
unique complexities: multiple interfaces with stakeholders such as local communities
and government bodies, new regulatory and environmental requirements, and often
unique technological challenges. We define megaprojects of this scale as
ultralarge.
To draw on a sporting
analogy, seeing any large-scale project through to a successful conclusion is
by definition a marathon not a sprint. Without doubt, every marathon, at a
little over 42 kilometers, is a substantial challenge. An ultramarathon, by
contrast, is exponentially harder at up to 100 kilometers. Due to the enormity
of the challenge, it’s something for which you can never fully train—only a
select few know what it’s like to complete the race successfully.
Similarly, ultralarge
projects represent an exponentially tougher challenge than a typical
megaproject, often defined as $1 billion in in value or greater. They are the
preserve of the few. As the size of capital projects rises, so does the
complexity of strategy, design, financing, procurement, and, ultimately,
project execution.
Today, the prize for
executing large projects successfully is significant. With ever-increasing size
and ambitions, the modern construction megaproject not only has a lasting
impact on the owner organization but also can impact wider industry dynamics,
the regulatory landscape, and even geopolitical relations. However, execution
of large projects has historically proved difficult. On average, projects with
budgets above $1 billion are delivered one year behind schedule, and run 30
percent over budget. If this trend continues, $5 trillion in value will be
destroyed in the projects currently announced around the world. For the sake of
economic prosperity and lost opportunity alone, this must change.
So, how can project
owners boost their chances of completing an ultralarge project successfully?
We believe a critical
element for successful large project delivery has so far been neglected:
specifically the “soft” issues of project delivery such as leadership,
organizational culture, mind-sets, attitudes, and behaviors of project owners,
leaders, and teams. In our report, we refer to this blend of soft
organizational topics as “the art of project leadership,” as opposed to
standards, systems, processes, and technical subject-matter expertise, which we
refer to collectively as project management “science.” A better understanding
of how to get this art right will materially improve delivery of large capital
projects—this is especially true in the context of the largest and most complex
capital projects.
In addressing why
ultralarge projects continue to fall short of expectations—despite all the
experience, learning, discussion, and analysis that has been fed into this area
down the years—we set out to explore the unique success factors drawn from the
experience of “project practitioners”—people with hands-on experience in
ultralarge project delivery. We conducted in-depth interviews with 27
practitioners, who collectively have over 500 years of project delivery
experience, and then distilled, structured, and synthesized our findings.
While our interviewees
give full credit to the absolute necessity of getting the core
project-management systems and processes right (the science), most of the
practitioners almost take that part for granted, claiming that many companies
attempting large capital investment already do (and must) have best-practice
standards and processes implemented.
Our research kept
coming back to topics included in the art of project leadership; that is, the
organizational and leadership aspects—capabilities, mind-sets, practices,
attitudes, and behaviors—required to deliver the largest and most complex
projects. Through our interviews we have found that the art of project
leadership gains greater importance with increasing project size and
complexity.
In this report, we
discuss these findings, and provide actionable advice to capital-project
practitioners. We distill our findings to four mind-sets and eight
leadership practices across project setup and delivery phases that are critical
to success.
Of the eight practices,
four are relevant to the project setup phase and four are relevant
to the delivery phase . We believe that by embracing these mind-sets
and practices, project leaders can dramatically increase the chance of
successful delivery of ultralarge projects.
By Sergey Asvadurov, Tom Brinded, Trevor
Brown, Mike Ellis, David Knox, and Rod Speering September 2017
SEE PART2 FOR EXECUTIVE SUMMARY
http://www.mckinsey.com/industries/capital-projects-and-infrastructure/our-insights/the-art-of-project-leadership-delivering-the-worlds-largest-projects?cid=other-eml-alt-mip-mck-oth-1709&hlkid=76076574afbf4f07a336ab1e63d5a540&hctky=1627601&hdpid=1f480921-b135-4335-aa92-f959dd50b54f
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