Managing Major Projects

Managing Major Projects

There is a different way: how major projects in Germany could run more smoothly.

Things are currently not looking good for large-scale building projects in Germany – especially those involving a public sector authority as the principal. Even internationally, there is widespread astonishment at project delays and astronomical increases in costs, and Germany’s reputation as a first-class technology location is already beginning to suffer. But that is not how things have to be.

The projects affected include large infrastructure projects such as the international airport in Berlin or refurbishments of famous cultural institutions such as the Stuttgart State Theater. That this cannot continue has been recognized at the most senior levels, and has led to activities such as that initiated by the Federal Ministry of Transport. By 2015, a Manual of Large-Scale Projects is to be drawn up containing the recommendations of a panel of experts with aims including improving true-cost pricing, cost transparency and schedule stability, as well as the transparent presentation of risks.

However, there is no need to wait that long. As most of the reasons for the difficulties are home-made, they are basically already known.

Rasons

  • Unclear User processes and incomplete performance specifications
  • Principal’s organization and responsibilities unclear
  • Unrealistic cost expectations, failure to perform projections, and lack of risk analysis
  • Ineffective planning and construction processes, excessive project duration
  • Lengthy approval procedures and project interruptions
  • Lack of transparency and an incorrect assessment of the general public

Generally, any one of these issues is sufficient to derail a complex project. When several occur at the same time, they often amplify each other. But this could be avoided. Known issues are also solvable – if everyone puts the interests of the project as a whole ahead of self-interest.

As Drees & Sommer’s practical management experience shows, cost-effective, timely, high-quality execution of large-scale projects is indeed possible. Numerous examples, including the Potsdamer Platz in Berlin, the new Trade Fair Center in Stuttgart, Germany, and the complex refurbishment of the Deutsche Bank headquarters in the German city of Frankfurt am Main demonstrate this. An optimal process can only be achieved if the principal is prepared to meet certain conditions.

The principal must

  • define objectives clearly;
  • adhere to defined objectives;
  • establish a professional organization; and
  • make quick and clear decisions after appropriate preparation.

If these conditions are met, project managers and engineers can ensure a project is completed on schedule, within budget and to the required standard of quality.

Effective project management with lean management

Modern project management is based on the principle of lean processes during every phase of the project. The entire process is based on lean management principles, which facilitate continuous improvement throughout the project period.

The goals of lean management are driven by the principles of the value creation process:

  • maximization of value addition;
  • reduction of waste in all processes;
  • perfection of processes.

Lean management is derived from kaizen, a philosophy developed by the car manufacturer Toyota. Kaizen is translated as Continuous Improvement Process (CIP). To prevent ‘waste’ such as defects, cost overruns and project delays, project management has to delve significantly deeper into content and processes. Initially, of course, this is more time-consuming than a conventional approach. But this extra effort is compensated many times over by double-digit percentage reductions in time and costs.