Nuno Gil

External Change in Large Engineering Design Projects: The Role of the Client

A problem facing the management of large engineering design projects is: Why do clients often adopt an early commitment strategy on design decision-making when they want to speed up project delivery, yet allow late changes to the project definition to accommodate the resolution of (un)foreseen external uncertainties? Empirical findings illustrate this problem and underpin a 2-stage model of the concept development process, in which conceptualization is followed by design, and stochastic pre-emption simulates asymmetric changes. Simulation experiments demonstrate that when clients make commitments early on in conditions of high uncertainty, they increase the likelihood (upside risk) of speeding up delivery if external events do not materialize; however, if these events do materialize, they increase the likelihood (downside risk) of causing design rework and losing process predictability-especially when the ability to reuse design work after a change is limited. We show that moderate design postponement is appropriate if clients relinquish some of the upside risk of finishing the design sooner. Moderate design postponement does not increase the downside risk of overrunning the delivery completion date in relation to the risk clients incur when they commit earlier because it reduces expected variability in design. These insights highlight the clients role in foreseeing external uncertainties and judiciously instructing changes to design teams. They also demonstrate the applicability of postponement to large engineering design projects where external uncertainty emerges as a fundamental contingency

Upstream Problem Solving Under Uncertainty and Ambiguity: Evidence From Airport Expansion Projects

Environmental changes are common during development of large engineering (infrastructure) projects. To accommodate them when they occur, developers design and physically execute the upstream base building with preliminary information about the downstream business-critical fit-out. Base-building subsystems provide service space for occupancy, whereas fit-out subsystems make the space functional. We build theory on design under uncertainty and ambiguity from case study research, drawing on theory of preliminary information exchange in concurrent development. We find that the base-building subsystem shows low sensitivity to incremental changes in fit-out. However, it shows high sensitivity to radical changes, unless the two subsystems interact in a modular fashion. In the face of slow resolution of downstream uncertainty and difficulties in decoupling the physical interfaces (as is the case in modular design for example), upstream developers avoid starvation by making working assumptions at risk and exploring the space of possible design solutions through an early ldquooptioneeringrdquo stage. Two patterns for problem-solving upstream stand out: 1) iterate design when preliminary information is either ambiguous or precise, but unstable and 2) build buffers in the design definition to absorb foreseeable changes when the preliminary information lacks precision but is not ambiguous. Buffers can be designed out if downstream uncertainties resolve favorably before the buffers are physically executed.

Design Reuse and Buffers in High-Tech Infrastructure Development: A Stakeholder Perspective

This study investigates the implementation of design reuse and buffers in developing the infrastructure of high-tech production facilities Design reuse entails using the same systems architecture from one project to the next. Design buffers involve building slack into a proven systems architecture to absorb foreseeable change requests. Choosing the appropriate amounts of reuse and slack is dependent on the uncertainty in the manufacturing technology over the infrastructure life cycle. While proven infrastructure designs can economically accommodate incremental changes in technology, adaptation costs escalate when sufficient buffers are not built-in and changes are radical. We uncover opposing stakeholder interests in determining the extent to which reuse or buffers are used. Design reuse is attractive to the client to reduce the risk that a facility fails to perform, but limits the designers job to tedious customization work. Design buffers are attractive to the designer to do original problem-solving and limit the risks of being unresponsive to uncertainty, but not to the client who is not guaranteed that the investments will pay off. We find that inequalities between the two stakeholders in the governing power on design decision-making compound the difficulties in assessing and implementing the reuse versus buffers tradeoff.

The (Under) Performance of Mega-Projects: A Meta- Organizational Perspective

This study links evolution in organizational structure to ambiguity in the definition of performance in the context of organizations formed to develop long-lived infrastructure: so-called ‘mega-projects’. Based on a longitudinal, inductive analysis of three mega-projects in London, we argue that a mega-project is a meta-organization with two symbiotically-related constituent structures. The core, led by a coalition, is a mutable collective that shares control over the goal of the project and corresponding high-level design choices. The periphery is a supply chain selected to design and build the infrastructure, but lacks the authority to change the high-level choices. As the mega-project structure evolves over time, we show that the founders and new comers renegotiate the high-level choices and slippages in performance targets ensue. The conflation of committals to different baselines, differing preferences for efficiency and effectiveness, and rivalry in high-level choices gives rise to competing performance narratives which cannot be reconciled. Thus, we argue, the disappointing and controversial (under) performance of mega-projects may be a result of how their organizational structure develops, rather than due to any agency or competence related failure per se.

Project Safeguards: Operationalizing Option-Like Strategic Thinking in Infrastructure Development

When business strategists use option-like thinking to inform investments in physical infrastructure, developers need to operationalize leaving the options open at project implementation. This study defines safeguard as the design and physical development work for ensuring, or enhancing, the embedment of an option in the project outcome. Safeguards account for design changes stemming from option exercising if the environmental uncertainties resolve favorably in the future. They range from a design effort to secure space in a master plan (passive) to the construction of an integral component (active). A multiple-case study on the expansion of Heathrow airport shows how the confluence of two contingencies underscores decisions to safeguard under a limited budget. Safeguarding is more attractive when: 1) the assumed uncertainty that the option will get in the money is low because the outlay sunk on safeguards is more likely to pay off; and 2) the infrastructure architecture is modular because only the interfaces between components may require safeguarding. Irreversible investments on safeguards increase the option cost and reduce the exercising costs in the future. Safeguards therefore play out as a control point for strategic option-like thinking at project implementation. The empirical findings are summarized in a conceptual framework.

Language as a Resource in Project Management: A Case Study and a Conceptual Framework

This study sheds light on how project managers can use language as a resource for communicating with local communities and stakeholders alike, and protect the legitimacy of their decisions and actions. The verbal accounts produced by a senior project management team are examined in-depth. The accounts address the claims raised by residents affected by the expansion of the Heathrow airport. The context for the talk-in-interaction is one of conflicting interests: the promoter undertakes actions to mitigate the impacts of the construction works, but some residents feel frustrated that the business can grow at the expenses of their welfare. The findings reveal that managers tend to acknowledge all claims even when perceiving they lack legitimacy. The analysis of the words and phrasing in the conversational turns that form the accounts reveals three tones - caring, assertive, and apologetic - that managers use intentionally to frame linguistically the acknowledgements. The study discusses how the tones fit with the extent to which, first, managers consider that the claims are factually correct, fair, and precise as opposed to unfair, exaggerated, or opportunistic; and second, managers find technical or institutional references available for constructing the accounts. It also discusses the effects of congruence - or the lack of it - between what managers mean to say about what the project team will do, what managers actually say, how listeners interpret what was said, and what the project team actually gets done.

Interorganizational Development of Flexible Capital Designs: The Case of Future-Proofing Infrastructure

This mixed-methods study investigates a dilemma that interorganizational groups formed to develop long-lived capital assets invariably face at the project front end: either invest in flexible design structures that cope economically with change in requirements, this is design to evolve - at risk of the extra costs not paying off if the uncertainties fail to resolve favorably later on, or endorse cheaper but more rigid designs - at risk of higher adaptation costs if the uncertainties materialize in the future. Through an empirical study grounded in the British railway sector, we reveal that groups regularly engage in informal future-proofing discussions to address this dilemma. But faced with tight budgets and timescales as well as differing interests, the groups struggle to achieve consensus over the need for flexible designs. Through lab experiments and taking a flat governance structure as given, we unexpectedly find that an administrative device to facilitate multiparty future-proofing talks has limited impact on the outcomes. Hence, we argue that a collective action problem is central to interorganizational development of flexible capital designs. We conclude by discussing alternative structures to govern the project front end, and how to better exploit the value of flexible designs.

Sustaining Highly-Fragile Collaborations: A Study of Planning Mega Infrastructure Projects in the UK

This study discusses the sustainability of highly-fragile, consensus-oriented developments which rely on voluntary contributions of resources. The research is grounded on a dataset of interorganizational controversies that arose during the planning of four mega infrastructure projects in the UK. It uses Design Structure Matrices to qualify the decomposability of the design structures and of the structures that govern high-level decisions to set performance expectations. The analysis shows that fixed deadlines, tight budgets and equity concerns constrain efforts to decentralise governance and seek local consensuses. Time constraints also bring to the fore mutual-gains bargaining and compromise-seeking despite genuine efforts to engage in deliberative decision-making and effective collaboration. Hence, I argue, sustaining these pluralistic enterprises is per se a measure of positive performance. The study suggests four mechanisms that allow carrying the parties along as the development inches forward: loosening local targets, global buffers, flexible designs in use; and an umpire — an actor accountable to all parties and empowered to settle disputes.

Designing Infrastructure for Evolvability: Constraints on Collective Investments in Design Flexibility

This study investigates a dilemma that inter-organizational collectives formed to develop new infrastructure face at the project front-end: either invest in flexible designs that cope with change in requirements, this is design to evolve — at risk the extra costs upfront will not pay off if the uncertainties fail to resolve favourably in the future. Or endorse cheaper but more rigid designs — at risk of higher adaptation costs if the uncertainties materialise later on. Through an inductive study, we reveal how the collectives invariably engage in ad hoc future-proofing discussions to address this dilemma. But faced with tight budgets, conflicting interests, and mutual ignorance, they struggle to design in flexibility. Through lab experiments, we unexpectedly find that a formal framework to facilitate multilateral future-proofing discussions and thus improve process efficiency fails to significantly impact on the development process and outcomes. Hence, we argue, infrastructure design for evolvability is a collective action problem constrained by its inter-organizational structure. We conclude by discussing how structural changes may enable infrastructure design organizations to exploit in full the complementarity between design flexibility and project risk management