0

Full Content is available to subscribers

Subscribe/Learn More  >

Why Projects Fail (and What We Can Do About It)

[+] Author Affiliations
Matthew B. Schoenhardt, Vachel C. Pardais, Mitch R. Marino

Stantec Consulting Ltd., Edmonton, AB, Canada

Paper No. IPC2014-33515, pp. V004T02A005; 13 pages
doi:10.1115/IPC2014-33515
From:
  • 2014 10th International Pipeline Conference
  • Volume 4: Production Pipelines and Flowlines; Project Management; Facilities Integrity Management; Operations and Maintenance; Pipelining in Northern and Offshore Environments; Strain-Based Design; Standards and Regulations
  • Calgary, Alberta, Canada, September 29–October 3, 2014
  • Conference Sponsors: Pipeline Division
  • ISBN: 978-0-7918-4613-1
  • Copyright © 2014 by ASME

abstract

Over two-thirds of all mega projects result in failure, meaning they significantly exceed budget, miss schedule targets, or fail to achieve production close to design capacity. The reasons for project failure have been well documented over the past fifty years. Despite this large body of empirical evidence, many executive and project leadership teams continue to repeat the mistakes made on past projects. This can be partially attributed to project teams believing that their projects are somehow different from past projects and that others’ project mistakes are not relevant to their project. This paper is a literature review that considers the seven common root causes of project failure and how these root causes relate to the pipeline industry. No new primary data will be presented. The seven common root causes for project failure and their approximate impact on budget variance are:

1. Failure to complete front end loading = 60–85%

2. escalation = Up to 12%

3. Regulatory regimes = Up to 12%

4. Plant complexity = Up to 20%

5. New technology = Up to 20%

6. Solid feedstock = Up to 10%

7. Complex ownership = Up to 24%

This paper will also review and discuss seven common project traits closely associated with project failure, although not direct root causes. These traits are:

1. Concurrent detailed design and construction = up to four times greater risk profile

2. Non-integrated project team = up to three times greater risk

3. Contractual risk misallocation = up to two and a half times greater risk

4. Fast-tracking projects = up to two times greater risk

5. Lack of internal capacity = up to two times greater risk

6. Oil and Gas industry = up to two times greater risk

7. Brownfield vs. greenfield site = no direct impact

With these root causes and traits identified, several methods of risk and contingency analysis will be examined. An evaluation of each method’s ability to increase the success rate of capital projects will be discussed; ultimately, resulting in a recommendation on the optimal risk and contingency framework for improving project success rates. The paper will conclude with a summary of how Stantec’s risk and contingency framework is being implemented on pipeline projects.

Copyright © 2014 by ASME

Figures

Tables

Interactive Graphics

Video

Country-Specific Mortality and Growth Failure in Infancy and Yound Children and Association With Material Stature

Use interactive graphics and maps to view and sort country-specific infant and early dhildhood mortality and growth failure data and their association with maternal

NOTE:
Citing articles are presented as examples only. In non-demo SCM6 implementation, integration with CrossRef’s "Cited By" API will populate this tab (http://www.crossref.org/citedby.html).

Some tools below are only available to our subscribers or users with an online account.

Related Content

Customize your page view by dragging and repositioning the boxes below.

Related eBook Content
Topic Collections

Sorry! You do not have access to this content. For assistance or to subscribe, please contact us:

  • TELEPHONE: 1-800-843-2763 (Toll-free in the USA)
  • EMAIL: asmedigitalcollection@asme.org
Sign In