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Your Crystal Ball: The Power Of Predictability In Capital Projects

April 25, 2019

 

 

We’re in the business of making capital projects more predictable, so we spend a lot of time thinking about the principles and practices that have the power to establish and reinforce predictability. We call this predictability thinking™, and it’s a work in progress -- after all, capital projects are still woefully unpredictable the world over. We have a lot of work to do.

 

We can’t change this overnight, but what we can do -- and what we have committed to doing -- is to take you along with us as predictability thinking evolves. In this article, we’re sharing three pillars of predictability thinking that we think can have a marked impact on the way you build and conduct your next capital project.

 

Here’s the thing: Predictability is old-fashioned. Uncool. It went out of style a long time ago. But just because predictability is no longer en vogue does not mean that it has lost its value. On the contrary, its rarity makes it even more valuable as a competitive advantage. Why? Because what is en vogue these days is a move-fast-and-break-things mindset that simply doesn’t work for capital projects. Capital projects will never be 100% agile, because by their very nature they are slow-moving beasts that evolve over long periods of time. 

 

Capital projects are different.

 

A capital project is an entire economy built from scratch: people, salaries, scope; corporate, governmental and non-governmental involvement; armies of engineers; materials and equipment. We manage temporal complexities, cost complexities, environmental, regulatory and political complexities. This capital project economy will never be agile -- but it can be predictable. 

 

How? What protocols, methods and states-of-mind can help us manage these interconnected complexities? How can we begin to intelligently manage this economy so we can reliably produce macro-level results ten years down the line? Here are three pillars of predictability thinking to get your started -- your very own crystal ball.

 

1 | Measure And Manage Threats To Predictable Delivery

 

These new economies of capital projects are rife with conditions that threaten predictability. For example, we see many engineering, procurement and management operations that are increasingly virtual, with project leaders leveraging overseas engineering centers, remote teams and ever more virtual collaboration. This is a double-edged sword, and a sharp one: Poorly managed off-site labor can quickly destabilize a project and become a significant threat to predictability.

 

Leaders can prevent this by actively working to identify and manage threats to predictable project delivery. In this case, project leads can study remote teams, learn how they differ from co-located teams, and put in place practices that drive quality communication and productivity across the miles. That kind of risk management through disciplined collaboration is key to reliably driving predictable results.

 

2 | Build Systems That Support And Enhance Predictable Behaviour

 

Ultimately, the predictability of a project comes down to each individual executing their work in a predictable way. Leaders need to consider whether and how their systems support and encourage predictable behavior among individual members of the team -- regardless of whether those team members are on the payroll, or work for contracted organizations.

 

This is about developing career path and compensation structures that incentivize predictable behavior -- for example, by making on-time, on-budget delivery a key performance indicator from which economic bonuses are calculated and paid to senior project managers. It is about developing contractual incentives that reward companies that deliver predictable results -- and penalizing companies that do not. Management systems can also be leveraged to incentivize predictability.

 

3 | Look for and lock in repeatable processes

 

Capital projects leaders talk a lot about standardization, and that’s an important discussion to have -- but that’s not what we’re talking about here. For the purposes of predictability, you need to create repeatable processes that can be leveraged across multiple projects and refined over time. The goal here is to identify core processes that can be repeatable in the context of multiple projects with minimal reconfiguration. In addition to boosting predictable capital project delivery, these will allow you to scale your operation more efficiently.

 

If you’re serious about transforming your capital project team into a predictability-powered organization, get in touch with Concord by clicking here!

 

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