17 Nov 2020

Getting it Right: Supporting Mega Project Delivery

Projects
Getting it Right: Supporting Mega Project Delivery

With major projects in the pipeline, how can we ensure they are delivered to a high standard and within budget?

As we look to 2021, for project managers an important topic is around the increased ‘mega’ projects in the pipeline and how we can ensure these projects don’t see the same cost blow outs as we have seen in the past.

A new report from the Grattan Institute, titled The rise of mega projects: Counting the costs, which looked at major project delivery in Australia and the potential for cost overruns, showed that major projects are particularly risky. In fact, over one third of project overruns since 2001 were due to just seven big projects.  

Here at the Australian Institute of Project Management (AIPM), we believe that the availability of skilled project management resources will be crucial to successful project outcomes of this scale, and essential if these projects are to adhere to industry standards and use of best practices. A key part of reducing the likelihood of a project cost blowout is by ensuring highly competent project professionals are driving these projects forward.

Over 2020 we have conducted several joint research pieces looking into the role project managers play in supporting the bringing forward of these major projects and ensuring that they are completed to a high standard within budget.
 

THE DEVELOPMENT OF PROJECT MANAGEMENT SKILLS

Our most recent research with KPMG, The 2020 AIPM/KPMG Project Management Survey Report showed that 53% of project professionals believe businesses are not investing enough in developing skills for successful delivery of projects, despite 67% believing that projects are becoming more complex.

With project management now one of the ‘in demand’ jobs in Australia, developing project management capability is now more important than ever and should be a top consideration for organisations and governments.

While on the job experience is important, this should be supported by project management education and project management certification, which ensures today’s project managers have the knowledge, skillset and competency to support successful project delivery.


"Organisations need to continue to adopt new technologies and equip the next generation of project managers with the skills needed to manage complex projects to ensure they’re able to effectively deliver critical business projects.”

Peter Sexton KPMG Partner Management Consulting 
 

Download the 2020 Annual AIPM/KPMG Project Management Survey here



FOCUS ON GOVERNANCE, SKILLS AND EXPERTISE

Over the year, AIPM also worked with Aurecon on a joint discussion paper that delved into the subject of how specialist project management can be the engine of economic recovery.

In this paper, we looked at how the project management profession could support best practice delivery and highlighted the following areas to support significant capital spend:

  • Highly structured projects, strong leadership and governance;
  • Increased capacity and capability in the market to deliver; and
  • Experience of the challenges in delivering complex programs in a high-pressure environment.

Echoing the findings from the Grattan Institute, our paper found that if we don’t take this opportunity to learn from the past and get the basics right, there will inevitably be downsides for both the public and private sectors.


“There is a pressing need for competent and qualified project managers to deliver projects to a high standard, as efficiently and effectively as possible, to deliver on the government’s stimulus strategy.”

Lachlan Waite Program Manager at Aurecon’s Global Advisory Business
 

Read the thinking paper here on Specialist project management: The engine of successful economic recovery

 

A BUSINESS CASE WITH THE BENEFITS OUTLINED IS ESSENTIAL

Another key area to help reduce the potential for mega project cost overruns is around ensuring that a business case is created long before the project commences that includes the benefits of the project. However according to research from Edith Cowan University (ECU), supported by AIPM while 80% of projects have a business case, only half include the tangible benefits.

As highlighted by the research without benefits being present, it is difficult for organisations to measure what was achieved and even more difficult to track the achievement of benefits after a project has closed.

 


“Organisations should be looking at the financial and economic case for any future projects so that they only spend money on the most suitable projects to get the investment returns and value they need to maintain corporate health.”

Richard Hughes Joint Chief Investigator from ECU
 

Download our free guide on improving your project delivery here



MOVING FORWARD TO RECOVERY

With mega projects in the pipeline and an integral part of Australia’s economic recovery, now is the time to build a highly skilled project management workforce who can meet these projects head on.

If we do not take this opportunity to invest in our project management skills and capability, and ensure thorough frameworks, methods and planning is placed around these projects, we could see the mistakes of the past repeated.

As we move into the new year and to the economic recovery period, AIPM will continue to reach out to governments and advocate for industry standards and the use of best practices. We will also continue to speak to universities and vocational educators to ensure that project management courses become widely available in Australia, and have been assessed by project management specialists and meet the requirements of the project management industry.

The availability and competency of a skilled project management workforce to deliver projects efficiently is now more important than ever.


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