Megaprojects pose particular challenges; Atlantic Yards/Pacific Park ticks many of those boxes (+needs better governance)
This is the second of three posts reflecting on megaprojects and Atlantic Yards, responding to recent articles. Here are the first and the third.
In the December 2017 issue of Project Management Journal, The Past and Present of Megaprojects, Jonas Söderlund, Shankar Sankaran, and Christopher Biesenthal explain ten factors, according to academic Bent Flyvbjerg, that make megaprojects challenging.
I cite them with reflections on Atlantic Yards/Pacific Park.
1) Megaprojects are "inherently risky because of long planning horizons, nested interfaces, and complexity."
Indeed, the project, circumstances, and market have changed, and institutional expertise has come and gone.
2) They are "led by planners and managers without complete understanding and domain experience."
Indeed, the government overseers have varied in expertise, while the developer has shorter-term goals.
3) It's difficult to govern across "multiple stakeholders with diverse and conflicting institutional backgrounds."
Indeed, the nominal state oversight is often a deferral to the developer, and there's no firm hand integrating the role of other city and state agencies/authorities.
4)"They often build on non-standard technology and design.
This may seem less applicable, though relevant in the case of the gambit to build the tallest modular building or even building a deck over a railyard.
5) Projects are "typically overcommitted and centered on a specific kind of project concept at an early stage."
This seems partly true, since the project footprint, including a new railyard, was a given, but the configuration of the towers, including their function (office to housing) and location (no tower over arena plaza) has changed.
6)"Megaprojects are like big businesses, which might create principal–agent problems and optimism bias."
Yes, "optimism bias." We have long been given best-case scenarios, regarding timing, housing, and jobs, rather than a range of potential scenarios.
7)"Megaproject scope and ambition levels will change significantly during the life of the project.
Yes, at least in terms of the promised timeline and the amount of office space--even the affordability of the below-market housing.
8) "Megaprojects are high-risk activities with overexposure to “black swans” (Taleb, 2007)—extreme events with massively negative outcomes."
I'm not sure that real-estate cycles are truly black swans, since they are, if not predictable, expected at some point. But the economic downturn coupled with the real-estate downturn of 2008 sure changed the Atlantic Yards design, decoupling the arena from the four adjacent towers, and led to a smaller arena.
9) "Megaprojects often fail to account for the complexity and unplanned events that are inherent in their implementation."
Sure. The projected scenarios for Atlantic Yards/Pacific Park should always have included a range of outcomes.
10) "Megaprojects are built on misinformation about costs, schedules, benefits, and risks."
As noted above, we should have been given a range of outcomes and, yes, costs and benefits.
Insight: governance
The authors write:
A look back at Atlantic Yards/Pacific Park suggests it could use both. But if those in power don't want better assessment and better governance, how do we get there?
In the December 2017 issue of Project Management Journal, The Past and Present of Megaprojects, Jonas Söderlund, Shankar Sankaran, and Christopher Biesenthal explain ten factors, according to academic Bent Flyvbjerg, that make megaprojects challenging.
I cite them with reflections on Atlantic Yards/Pacific Park.
1) Megaprojects are "inherently risky because of long planning horizons, nested interfaces, and complexity."
Indeed, the project, circumstances, and market have changed, and institutional expertise has come and gone.
2) They are "led by planners and managers without complete understanding and domain experience."
Indeed, the government overseers have varied in expertise, while the developer has shorter-term goals.
3) It's difficult to govern across "multiple stakeholders with diverse and conflicting institutional backgrounds."
Indeed, the nominal state oversight is often a deferral to the developer, and there's no firm hand integrating the role of other city and state agencies/authorities.
4)"They often build on non-standard technology and design.
This may seem less applicable, though relevant in the case of the gambit to build the tallest modular building or even building a deck over a railyard.
5) Projects are "typically overcommitted and centered on a specific kind of project concept at an early stage."
This seems partly true, since the project footprint, including a new railyard, was a given, but the configuration of the towers, including their function (office to housing) and location (no tower over arena plaza) has changed.
6)"Megaprojects are like big businesses, which might create principal–agent problems and optimism bias."
Yes, "optimism bias." We have long been given best-case scenarios, regarding timing, housing, and jobs, rather than a range of potential scenarios.
7)"Megaproject scope and ambition levels will change significantly during the life of the project.
Yes, at least in terms of the promised timeline and the amount of office space--even the affordability of the below-market housing.
8) "Megaprojects are high-risk activities with overexposure to “black swans” (Taleb, 2007)—extreme events with massively negative outcomes."
I'm not sure that real-estate cycles are truly black swans, since they are, if not predictable, expected at some point. But the economic downturn coupled with the real-estate downturn of 2008 sure changed the Atlantic Yards design, decoupling the arena from the four adjacent towers, and led to a smaller arena.
9) "Megaprojects often fail to account for the complexity and unplanned events that are inherent in their implementation."
Sure. The projected scenarios for Atlantic Yards/Pacific Park should always have included a range of outcomes.
10) "Megaprojects are built on misinformation about costs, schedules, benefits, and risks."
As noted above, we should have been given a range of outcomes and, yes, costs and benefits.
Insight: governance
The authors write:
Second, the articles in our special issue demonstrate that success is often driven by political and/or power-related factors. This relates particularly to the topic of how megaprojects are managed. Seeing the highly political nature of stakeholders across the supply chain with different underlying objectives, the hard success factors do not seem to be enough anymore. This unique setup calls for innovative governance solutions that align stakeholder interests in a complex environment with a large number of key players.They say objective assessments might fight the typical over-optimistic assumptions. And "innovative governance" is needed.
A look back at Atlantic Yards/Pacific Park suggests it could use both. But if those in power don't want better assessment and better governance, how do we get there?
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