Busting the capital project myths

Like any industry, the world of construction is burdened with its share of myths about how work should be tackled. In this blog, based on episode four of our Megaprojects podcast series, our experts destroy three common misconceptions – and point to better ways of working in which every person and every conversation matters.

Authors: Billy Glennon, Chauncey Bell and Connor Butler

Myth 1: The key to successful project delivery is ensuring strong planning, management and control.

“In 1982, I was a junior guy working for Andersen Consulting when PCs were starting to emerge,” recalls Billy Glennon, Group CEO of VISION. “I remember going to my senior partner to say that we should start up a practice around PCs and the revolution that was starting to happen in computing. He gave me about 30 seconds and then said: ‘A PC is just a toy. We’re in the business of big computer systems and that’s all we need to focus on. Those things will never take over.’

“And of course since then there’s been four or five revolutions in IT – and they’ve all been dramatic,” adds Billy. “We moved from the world of the mainframe to the PC to the client server and the web. But the people who were experts in their domains, locked everyone in and made them blind to dramatic shifts that were going to make their way of working obsolete. When you’re operating within a fairly steady domain, with good controls, good structures and good metrics, you’re in a strong position to manage the project. But when you’re dealing with dramatic shifts, those controls have the opposite effect because they distract you from what’s going on outside. That’s why people in construction believe that the current system works. They’ve locked themselves into ways of working based on tried and true practices instead of seeking out radical ways to improve.”

Connor Butler, Managing Principal of the Arizona-based construction consultancy Relevate, sees this all around him. “There’s a large construction company that for the last three years has had to restate its earnings several times,” he says. “They’ve been through several CEOs and this year they released a report on their turnaround plan, which was basically to introduce bigger, more stringent financial controls at the start of projects to keep them out of bad deals. And what’s interesting about that is the reason that they got into trouble before was probably that they had people who weren’t following the control processes, which is why they got into bad deals. So their answer is to do even more of what people were ignoring. There’s a lot of that in the industry, and it just makes things worse.

“Here’s another example,” says Connor. “We were trying to put together proposals for some strategic planning work for a client and I wanted to subcontract a senior person in the company for 20 hours of his time. But the approval process to do that and complete paperwork just so he could share his opinions with me took forever. What was the point? I don’t know, but it’s not working.”

Myth 2: Construction is simply a process – think of it like a factory production line.

“The problem with relying on a process, as we discovered with military strategy some hundreds of years ago, is that it never survives first contact with the enemy,” says Chauncey Bell, a US-based commentator on social, commercial and technological innovation. “When you meet the enemy, things happen that you cannot plan for or anticipate. And there is very little literature in the world of capital projects about what you do in the field of action when something unexpected happens. So the normal response is to send it out to a committee to study what’s going on and figure out what to do. And then you put that into the plans for the next project to make sure that you know how to deal with it the next time it comes around. But we’re missing out on something. We’re not taking seriously what is happening between the human beings in the middle of the action when things go wrong. We could learn a lot from listening carefully to those conversations.”

Chauncey’s mind turns to the Amish approach to building agricultural barns. “In the Amish communities of Pennsylvania, everyone comes together when someone needs a barn, and they build it together in a weekend,” he says. “Everyone knows what to do and they have a party at the same time, with lots of food and the children playing nearby.

“So how do they manage to put up a barn without a business plan or engineering drawings? And how do they do it with what I will bet are very low injury rates? Well, they are able to do it because they’ve been spending generations learning how to talk with each other about what they’re doing. Yet when we’re looking at a construction project, we gather not one community but fragments of a dozen communities and say ‘okay, build a barn’. And because they’re all trained in carpentry or bricklaying or electrical work they all think they know what they’re doing. But what they don’t do is pay any attention to how they are listening to each other or speaking to each other. And they don’t know what it takes to build a community that can coordinate action fluently.

“We expect capital projects to be achieved through a good business plan, a speech about what we’re going to do here and a set of engineering drawings,” adds Chauncey. “That’s crazy. We should be creating a micro-civilisation like the Amish barn builders.

Billy Glennon agrees. “I’ve heard it said that running a really big capital project is like running a town,” he says. “But it’s not – it’s like building the town from scratch, finding the 50,000 people, putting in place the infrastructure, the plumbing, the roads, the construction, and running the town at the same time to establish governance and ways for people to work together. That’s a lot more complicated than production lines.”

Myth 3: “Managers should manage and workers should work.”

“This is one of my favourites,” says Chauncey. “I am continuously struck by the way in which some people believe that their work happens in their heads (they call it thinking) while others are told that their work happens with their hands, and that they are the ‘trades’. And the people who went to engineering or business school have been taught that you need to make sure that the trades people are doing the right things with their hands. We are often scandalously dismissive of the thinking of these people when, in fact, the heart of the work in a construction project concerns the conversations they are having between themselves. The attitude is often: ‘You guys are the trades – you need to shut up and wait until you get instructions from us.’

“Fundamentally, it boils down to the fact that everybody matters, everybody’s important,” says Connor Butler. “And no matter what you’re doing in life, if you treat everybody like they matter, and their thoughts are important, you get to a much better place. There’s the story about John F Kennedy touring the NASA Space Centre in 1962,” adds Connor. “When he saw a janitor sweeping the floor, he asked him what he was doing and the janitor said: ‘Well Mr President, I’m helping to put a man on the moon’. The story may be a bit of a cliché but the message is important. People want to know that what they do matters.”

Hear the podcast episode here.