Working Paper Proceedings

Engineering Project Organizations Conference

South Lake Tahoe, CA
November 4-7, 2010
Proceedings Editors
John E. Taylor, Columbia University
Paul Chinowsky, University of Colorado - Boulder

Analysis and Improvement of Megaprojects

Performance
Authored by

Adnan Haidar and Ralph D. Ellis Jr.

© Copyright belongs to the authors. All rights reserved. Please contact authors for citation details.
 Proceedings – EPOC 2010 Conference

ANALYSIS AND IMPROVEMENT OF MEGAPROJECTS PERFORMANCE

Adnan Haidar1, Ralph D. Ellis Jr. 2
ABSTRACT
Megaprojects are large, complex, and expensive projects that often result in undesired
outcomes with enormous cost overruns and time extensions. Megaprojects have been studied in
many academic areas such as public planning, urban decision making, and economic analysis
areas. They have been analyzed as complex hard to finance projects with economic gain and
social impact. Limited research has been done in the construction industry to investigate
megaprojects and to improve their performance. This research defines megaprojects in their
construction management context. It analyzes their characteristics that cause time and cost
overruns. Finally, it attempts to improve megaproject poor performance by presenting a set of
work practices that were applied on different megaprojects.
KEYWORDS: megaprojects, size & complexity, performance, integration

I. INTRODUCTION
Megaprojects are unique construction projects known for their complexity, vast size,
expensive cost, and long time frame compared to conventional construction projects. The size
and complexity are reflected by a price tag that exceeds one billion dollar and by a time frame
that may exceed the five year limit. Megaprojects are known for their poor performance in terms
of cost and time where the cost overrun could exceed initial project cost and the time extension
would extend for years. There are numerous examples of megaprojects that were built and
performed poorly. The most famous project is the Channel Tunnel which cost 2.6 billion pounds
in 1985 and led to 80% cost overrun (Flyvbjerg et al. 2003). One of the most expensive highway
projects in the U.S. is the Boston artery ―Big Dig‖ project, where an elevated highway was
replaced with an underground tunnel. The project was estimated in 1985 to cost $2.8 billion but
was completed with over $14.6 billion (Reina et al. 2002). In addition, there are different
specialized megaprojects such as power plants. Nuclear power plants are the most expensive to
build and lead to enormous cost overruns. The cost overruns of nuclear power plants built
between years 1966 to 1977 averaged to 200% (Energy Information Administration, 1986).
Given their infamous reputation, megaprojects have attracted researchers‘ attention from
different academic areas. They have been studied from many points of views especially the
public planning, urban decision making, economic analysis, and social impact point of views.
Unfortunately, limited research has been done in the construction industry to investigate
megaproject‘s characteristics and poor managerial performance. In addition, no practical means
were developed to improve their performance in order to meet time and cost constraints.
This paper progresses in a series of steps that start with clearly defining megaprojects according
to size and complexity. It continues by analyzing megaprojects‘ characteristics and the
corresponding managerial challenges that cause poor project performance. It progresses by
presenting a theoretical approach to improve megaproject performance through adequate system
integration. Finally, it presents the theory‘s corresponding work practices by identifying existing

1
PhD Candidate, University of Florida, Gainesville Florida, [email protected].
2
Associate Professor, University of Florida, Gainesville Florida, [email protected].

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work practices that were employed in megaprojects and contributed to the improvement of
project performance in terms of cost and time.

II. DEFINITION OF A MEGAPROJECT

Up till now there is no exact definition of a megaproject. Moreover, there is no definite
understanding of what differentiates it from any other large or complex project. The only
common agreement among practitioners and researchers is the concept of a large scale project
with a price tag in excess of one billion dollar (Fiori et al. 2005), that frequently leads to cost
overruns (Flyvbjerg et al. 2003). In this paper megaprojects are defined in their construction
management context according to project size and project complexity. The first part of this
section presents previous definitions provided in the literature. The second part defines project
size and complexity for the purpose of defining and differentiating megaprojects. Finally in the
third part, a System Diagram is developed to clearly differentiate projects based on their size and
complexity, hence clearly defining megaprojects.

A. Literature Definitions of a Megaproject

There are numerous definitions of megaprojects throughout the construction literature. However,
the majority of definitions provided place megaprojects not in their construction management
context but in a wider public planning and economy context. For instance, megaprojects are
defined as significant undertakings characterized by multi-organizations seeking success on
different objectives subject to socio–political impacts (Ruuska et al. 2009). Other definitions
consider megaprojects as projects that have a strikingly poor performance in terms of economy,
environment, and public support. Also, they lead to cost overruns and lower-than-predicted
revenues that hinder economic growth instead of advancing it (Flyvbjerg, et al. 2003). The
Federal High Way Administration (FAHWA) defines megaprojects as: ―Major infrastructure
projects that cost more than $1 billion, or projects of a significant cost that attract a high level of
public attention or political interests because of substantial direct and indirect impacts on the
community, environment, and state budgets‖.
Megaprojects should be defined in their construction management context that is projects with
activities, resources, budgets and deadlines. Capka (2004) defines megaprojects as expensive
projects that require the management of numerous, concurrent, and complex activities while
maintaining tough schedules and tight budgets. More elaborate definitions describe megaprojects
as large scale complex projects that often fail to meet costs estimations, time schedules, and
anticipated project outcomes. Other definitions describe megaprojects as projects that contain a
large element of technological innovation associated with high risk and characterized by conflict,
uncertainty, and poor cooperation between partners (Marrewijk et al. 2008).
Construction management definitions describe the megaprojects broadly. These definitions could
apply to any construction project that may lack megaproject‘s characteristics. In other words, the
definitions do not clearly define megaprojects and differentiate them from other projects.

B. Definition of Size and Complexity

Project size and complexity are defined for the purpose of differentiating projects with varied
sizes and dissimilar complexity levels. The size of a system is defined by the number of items
found in the system such as activities, work groups, or designs etc. Complexity is harder to
explain. There are dozens of complexity concepts, definitions, and models one could obtain from

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the management theory resources and construction management literature. The meaning of
project complexity is wide and open to many interpretations. In other words, the meaning of
complexity is subjective and it is in the eyes of the beholder (Stocks et al. 1985).
In this research, complexity is defined according to 2 dimensions; the number of interrelated
parts, and the interrelatedness of these parts (Baccarini, 1996).
Every system is defined according to a size and a degree of complexity. Complexity is
determined by the number of different elements in the system and the interrelatedness of these
elements; size is determined by the quantity of similar items per element. Accordingly, a Project
Diagram is developed to define and differentiate projects based on size and complexity
dimensions. The complexity dimension is defined by two aspects, differentiation i.e. total
number of dissimilar elements (shown in different geometrical shapes) in the system, and
interdependence among these elements (shown in the number of arrows).
System A

Complexity

Number of Elements
System B

Differentiation
Interdependence
System C System D

System C
System A System B
Size

Number of Items per Element

System D

Figure 1: Size-Complexity Project Diagram

1. Project Size
Project size could be explained by a multitude of aspects. In this paper, the most basic size
aspects considered are the constructed area and the time frame needed to build the project. The
constructed area and the construction time frame are indications of the quantity of items per
element used in the project such as labor, equipment, work groups, and material used.
2. Project Complexity
There is a multitude of aspects that could explain complexity. However, the most basic aspects to
describe project complexity in the construction management context are the design complexity
and managerial complexity.
Design Complexity
Design complexity is determined by design differentiation and design interdependence.
Design Differentiation: It is explained by two aspects. The first aspect is the number of different
steps taken to achieve the final product. For instance, a civil engineering design of a simple road
would be composed of a limited number of steps. Whereas a tunnel design that includes many
geotechnical, structural, environmental, and safety elements would be composed of plentiful
steps. The second aspect of design differentiation is the number of different engineering
specializations included in the design. For instance, designing a complex power plant would

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require civil, electrical, and mechanical engineers in contrast to designing a simple road that
would require a limited number of specializations.
Design Interdependence: It is explained by the interrelatedness of different design elements. The
elements could be different design steps that may be highly related or independent. In addition,
interdependence could be explained by the relation between different engineering
specializations. For instance, electrical and mechanical trades are more interdependent in
industrial plants that include motor control centers, than in simple buildings that include simple
electrical lighting and simple piping and ventilating systems.
Organizational Complexity
In the construction management context, organizational complexity is illustrated by the
managerial and operational complexity. In other words it is the complexity of integrating work
crews and coordinating dissimilar engineering trades.
Organizational Differentiation: It is explained by the number of different entities to be managed.
The entities could be different work groups and different engineering trades. As the project
increases in size, more work groups are added contributing to more organizational
differentiation. Also, as the project increases in complexity (namely design complexity), more
specializations are added contributing to more organizational differentiation.
Organizational Interdependence: It is explained by the interrelatedness of different entities‘
works. Different projects have different organizational interdependence depending on the nature
of the works and the design complexity. Thus, different projects require varied efforts of
integration and coordination among work groups. For instance, physically integrated
electromechanical works found in electric rooms need more coordination efforts than physically
distant electrical and mechanical works.
Design Interdependence
Design Complexity Design Differentiation
Project
Complexity Organizational Interdependence
Organizational Complexity
Organizational Differentiation

C. Definition of Megaproject Based on Size and Complexity

Theoretically, a megaproject is not different than any other construction project. It includes
numerous parallel activities, limited resources, tight schedules, and multiple decision making
parties. Therefore, a megaproject is defined in comparison with other projects according to size
and complexity. The Project Diagram is further developed to set a clear differentiation among
different categories of projects.
The Diagram‘s size axis is composed of the constructed area and time frame. The complexity
axis is composed of two aspects. The first aspect is the design complexity that ranges from
simple design to complex and difficult design. Simple design corresponds to a limited number of
design steps and specializations. Complex and difficult design corresponds to a large number of
design steps and design specializations. It also corresponds to a high degree of interdependence
among different design steps and among different engineering specializations. The second aspect
is the organizational complexity that ranges from simple execution to complex execution. Simple
execution corresponds to a small number of work groups with limited interdependence among

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them. Complex execution corresponds to numerous groups with substantial interdependence

among them. The following project categories could be allocated using the diagram:
Small and non-complex projects (Small Projects - SP)
Small non-complex projects are described to have a small constructed area and a relatively short
construction time frame. They are simple to design and build. They neither require complex
designs nor complex managerial organizations to have a successful project performance. Several
projects could fit this category such as simple roads, houses, and small residential buildings.
Large and non-complex projects (Large Projects - LP)
Large-scale projects have a large constructed area and a relatively long construction time frame.
They neither require complex designs nor the services of many engineering trades. However,
they require a complex organization to integrate numerous work groups and to manage limited as
well as plenty resources. Several simple yet large projects could fit this category for instance
long roads, highways, bridges, and airport runways.
Small and Complex (Complex Projects - CP)
Complex projects have a relatively small constructed area as compared to large projects such as
highways. The time scale would vary among different projects. They encompass complex
designs since numerous specializations are required. They require complex management,
integration, and coordination of different engineering trades. Examples of such projects are
complex hospitals, hotels, and other specialized projects.
Large and Complex (Mega Projects - MP)
As their name signifies, large scale complex projects have a large constructed area and a long
time frame. They encompass complex and challenging designs since numerous design steps and
specializations are required. They require complex management, integration, and coordination of
different work groups. Furthermore, they require the integration of different engineering trades
within each work group. They require complex resource management given the limited labor
resources and enormous material quantities. Examples of such projects are power plants, large
industrial plants, airports, and large transportation such as metro-railway tunnels.

Complexity
Complex
Complex Difficult
Execution Design Complex Projects (CP) Megaprojects (MP)
Complex
Design
Simple
Simple Small Projects (SP) Large Projects (LP)
Execution
Design
Size
Time 1-2 yrs Time 2-4 yrs Time 5 yrs
Small Area Large Area Very Large Area

Figure 2: Developed Project Diagram

According to the Project Diagram, megaprojects are defined as large scale projects that have a
long time frame and are characterized by a complex difficult design and complex organization.
Their size and design complexity necessitate a complex managerial structure in order to manage
and integrate different work groups, engineering specializations, and limited resources.

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III. MEGAPROJECT PROBLEMS AND THEIR CAUSES

The recent decades have seen numerous well-known infrastructure megaprojects that expanded
the engineering limits and brought economic development and progress worldwide.
Nevertheless, these projects were accompanied by overwhelming problems. Megaprojects
throughout the world have had a calamitous history of cost overruns where the difference
between the actual and estimated cost was often fifty to a hundred percent (Flyvbjerg et al.
2003). In the United States, large scale projects have similar problems. According to a study
done by the US Department of Transportation that covered ten US rail transit projects, the total
capital cost overrun of these projects was sixty one percent (US Department of Transportation,
1990). Throughout the construction management literature, different case studies and researches
have determined several megaproject problems and the causes of these problems. This paper
attempts to explain megaproject poor performance by means of size and complexity. The
increase in size and complexity impose enormous project management difficulties that the
management team is incapable to handle leading to inefficient performance in terms of cost and
time.

A. Literature Problems and their Causes

Megaproject‘s poor results could be contributed to a variety of reasons. Several different
researchers have determined different causes of poor performance. According to Flyvbjerg
(2003), the causes of poor performance are:
Lack of realism in initial cost estimates
Underestimation of the length and cost of the delays
Contingencies are too low
Changes in specifications and designs are not adequately taken into account
Underestimated changes in currencies exchange rates
Underestimated geological risk
Undervalued quantity and price changes
Underestimated expropriation costs and safety and environmental demands
High risk as a result of technological innovation that is translated into cost increase
The Construction Industry Institute CII summarizes the general reasons of large scale project
problems in the following areas: Front end planning, design, procurement, startup phase, human
resources issues, organization structure, project processes, and project control (CII 1987).
Throughout the construction management literature, numerous case studies have been conducted
to determine the causes of the poor performance. The causes of poor performance are summed
up in the following list:
Planning Phase Causes of Poor Performance:
Incomplete design especially with innovative designs
Incomplete execution requirements
Non-realistic planning in terms of cost and time (compressed schedule and competitive
low prices)
Underestimation of the project‘s complexity (optimism in ability to manage such
complexity)

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Underestimation of the size and material requirements (optimism in ability to supply and
manage resources with such size)
Under evaluated risks (low contingencies for technical, operational, and business risks)
Difficult long term planning that doesn‘t solve uncertainty issues in the long run
In-efficient governmental procedures and regulations, environmental and other time
consuming effects
Execution Phase Causes of Poor Performance:
Variations and mistakes due to inadequate planning, incomplete execution requirements,
and ambiguous design documents
Poor project culture leading to productivity loss
Parties‘ adversarial relationships and disputes
Inadequate project organization that is insufficient for the size and complexity of the
project
Poor communication and team work
In-efficient owner decision making structure caused by governmental intervention,
paralyzed public/private inadequate partnership operation
Poor coordination and integration of work crews; inexperienced personnel in critical
positions
Several causes of poor performance obtained from the literature review – i.e. underestimation of
size and complexity, non-realistic planning, inadequate project organization, inefficient structure,
and poor integration – highlight the fact that the conventional management practices are
insufficient to handle megaprojects‘ characteristics. The following section analyzes how
megaproject‘s characteristics impose managerial challenges that are difficult to handle leading to
poor performance in terms of cost and time.

B. Megaproject Characteristics & their Management Challenges

In megaprojects, the workforce is composed of numerous work groups that operate in parallel
due to the large size and complexity. With a single work entity, the managerial duties are limited
to the daily duties such as cost control, time control, progress reporting, communication,
correspondence, and workflow direction. The operational level would be consumed with daily
workforce activities in order to stick with the project milestones. However, with multiple work
entities, the managerial duties would differ substantially. Management has to conduct the daily
duties with each of the work groups independently. Furthermore, management has additional
duties in order to organize and integrate a complex web of systems over an enormous
construction site. It has to manage and integrate work flow, schedule, and resources among all
working groups. Consequently, the management team would be overwhelmed by the number of
interactions needed to manage all these elements leading to a bottleneck at the management level
and an inactivity of work crews at the operation level.
The following is a description of the management difficulties imposed by the characteristics and
the corresponding managerial problems
The increase in size would impose:
An increase in the number of work groups to be managed leading to a multiplication of
the daily efforts to follow up with each of the work groups

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Work coordination and managerial efforts to integrate the work flow and schedule of the
work groups
Increased coordination efforts among different work groups
Labor workforce management among different work groups
Material and equipment management efforts among different work groups
The increase in complexity namely design complexity would impose:
Management efforts between subgroups or engineering specializations within each group.
The subgroup management efforts would be rigorous since the works should be
coordinated and integrated according to time and space constraints
Technical and functional support which would add to the managerial efforts required to
handle a complicated design. The support required is summarized by quality control,
quality assurance, means and methods, and design support

Top Management

Workflow Management
Integration

Technical
Support
Work Group 1 Coordination Work Group 2 Work
Group n
Specialization 1 Specialization 1
Specialization 2 Specialization 2
Sub-Coordination
… …
Specialization n Specialization n

Workforce Management
Material Management

Figure 3

The increase in size and complexity is often underestimated by construction practitioners and is
usually countered by an increase in resources (equipment, labor) and an increase of the number
of working hours. The inability of conventional work practices to handle the increase in
managerial load would lead to:
Unutilized working teams because of the large number to be integrated
Slow progress and mistakes in uncoordinated operations because of the complicated
sequence of activities and operations that demand coordination
Unavailability of resources because of the large load of material to be managed
Mismanagement of finite resources such as the labor workforce
Improper coordination that would lead to the inactivity of some engineering trades and
time consuming error corrections.

IV. MEGAPROJECT PERFORMANCE IMPROVEMENT

Megaproject managerial performance could be improved by modifying the work practices in
order to handle megaprojects‘ characteristics. Several previous attempts have been provided by
researchers in order to improve performance. However, the techniques provided were general
and were not tested on a construction site. This section presents a theoretical approach on how to

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improve megaproject performance through adequate system integration. Furthermore, it presents

the theory‘s corresponding practical work practices to be applied on the construction site.

A. Literature Performance Improvement

Construction management literature has provided limited methods of how to improve
performance on large complex projects. Nevertheless, the literature provides numerous studies
about critical success factors that contribute to project performance improvement. The Critical
Success Factors CSFs are general guidelines of what might contribute to the project success. For
instance, some important critical success factors are effective project planning and control,
sufficient resources, detailed written contract, and clear defined goals … (Toor et al. 2007).
According to different studies by different researchers, the CSFs may vary in importance and in
number. Though useful, the critical success factors only answer the question of what to do
instead of how to do. In other words, they only provide guidelines and goals not methods and
practices of how to achieve the goals.
There are several researches that did provide an insight on how to improve performance on large
projects. Platje (1993) provided that classical planning and management is not suitable for
megaprojects and can result in a bureaucratic, inflexible, and powerless organization. Thus, the
solution would be to delegate responsibilities to the lowest possible levels of the organization
and to improve the communication between departments and head project managers. This would
lead to an open, flexible, and creative organization that is suitable for large projects. Other
researchers provided different organizational alternatives for large projects that would aid the
managers in meeting the challenge of effective project organization. The organizational
alternatives are determined by the situational analysis of goals, external influence, design and
work technology, and project phase (Tatum et al. 1986). Nevertheless, these organizational
alternatives haven‘t been tested or evaluated by construction practitioners.
The strategies and guidelines provided by the literature are broad, well known, and applicable to
all construction projects. However, these techniques are general and do not provide a practical
work plan for construction practitioners. Therefore, more tangible and practical methods should
be researched. In addition, the methods and work practices should be tested on a construction
project to determine their affect on the performance outcome.

B. System Integration and Work Practices

A construction project is analyzed as a large and complex system composed of different
interrelated elements i.e. workgroups. The work groups should be sufficiently integrated to
provide better performance.
In this research, system integration is defined as a process to bring together inputs, different
elements, and outputs to improve project performance. The inputs are project design, project
schedule, and resource supply systems such as labor, equipment, and material. The elements are
the different work groups, management levels, and engineering trades that should be integrated
according to the design, common works, and schedule. The output is the workflow of groups that
impacts future activities of different groups in terms of schedule or design changes.
Therefore, system integration is explained according to two different aspects i.e. production
integration and functional integration. Each of these integration aspects would be necessary to
offset the poor performance caused by the megaproject characteristics. Accordingly, as the
project size increases, there would be more need for production integration; and as the project
complexity increases, there would be more need for functional integration.
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1. Production Integration
Production integration is the integration of all systems that contribute to the construction process.
As size increases, there is more need for production integration in order to make the construction
process more streamlined and efficient. It includes the integration of teams‘ work flow, teams‘
schedules, material supply, labor supply, and the construction activities. Furthermore, it includes
the integration of different managerial levels in order to make the procedural and decision
making processes more efficient and less disruptive to the construction process. The production
integration could be achieved through the application of the following work practices and
innovative tools:
Streamlined site organizational structure
Centralized networking systems among different work groups
Material supply chain
Resource management of labor and equipment
2. Functional Integration
Functional integration is the integration of different functional groups. The functional groups are
groups that have different specializations or who have different functions throughout the
construction process. It includes the integration of different functional work teams; the
integration of the workflow among different specializations according to a sequence and time
constraints; and the physical integration of the works according to space constraints. The
functional integration could be achieved through the application of the following work practices
and innovative tools:
Integrated organizational structure among different functional groups (specializations)
Centralized networking systems among different specialization groups
Visualization and other computer aided technologies (3D-4D technologies)
Design constructability and easiness of execution

V. MEGAPROJECT CASE STUDIES

Several case studies were conducted to retrieve the work practices applied on large scale
construction sites. The work practices researched were the practices that improved production
and functional integration such as planning and design, site management organization, top
management organization, and modular work practices. The targeted projects were projects that
belonged to the megaproject category. In other words the projects were characterized by large
size, design complexity, and execution complexity. The information retrieved was from previous
construction management literature, managerial technical reports, engineering technical reports,
and management books that analyzed different aspects of the projects. The following is a brief
description of the projects researched:
1. I-595 Port Everglades Expressway
The expressway is 13.4 mile long and includes three major 4-level interchanges with I-95, I-75, a
US Route, and Florida Turnpike (Over 300 lane miles of road that required 15 million CY of
embankment). The total cost of the project including the design, utility relocations, construction,
inspection, and owner‘s administrative costs was estimated at 1.2 billion Dollars (1990). The

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construction time was in excess of 7 years. The project was composed of 20 separate
construction-contract segments designed by eight different consultants.
2. The Denver Airport Megaproject
The Denver International Airport is one of the largest airports in the world. It was initially
planned to cost 2.5 billion dollars in 1990, but that figure grew to a 5.3 billion dollars in 1995.
The airport was built on a 53 square mile construction site and was composed 2 terminals, 3
airside concourses, 6 runways, 88 air carrier gates, and 32 commuter gates. The concourses were
connected to the terminals through a 6,200 ft long tunnel system. The design team was composed
of 61 designers of different specializations. Furthermore, there were 134 construction contracts
and about 2000 subcontracts agreed to by the airport officials.
3. Boston’s Central Artery/Tunnel Project
The Boston Artery/Tunnel is the largest and most expensive public works project ever taken in
the United States. It is a 7.8 mile system of bridges and underground highways and ramps. It
includes the world‘s widest cable-stayed bridge and a deep underwater connection. It imposed
several engineering challenges. The construction site was a dense urban area so traffic was to be
kept flowing. The soil was to be stabilized to ensure minimal damages to existing structures.
4. Nuclear Power Plants
Power plants in are in general very large in scale. According to the Department of Energy
nuclear power plant assessment (2005), a resource loaded schedule is estimated to be a five-year
schedule with site preparation taking 12 to 18months, construction (first concrete to fuel loading)
taking 36 to 42 months, and commissioning and testing taking 6 to 12 months. The project
complexity is so great that the number of contractors and suppliers who can undergo such
projects is limited. According to the Department of Energy nuclear power plant assessment
(2005), constructing a nuclear power plant needs highly-skilled and highly-valued qualified
construction workers and specialized workers such as boilermakers, pipefitters, electricians, and
ironworkers.

VI. WORK PRACTICES APPLIED

Different work practices applied would improve the project performance since each work
practice would contribute to the production and functional integration of the project. The work
practices retrieved from the case studies:

A. Site Management Organization

The choice of site organization would determine the level of production integration and
functional integration of the project. The management organizations retrieved are well known by
construction practitioners and in the construction literature. However, more elaboration is done
to give an insight on how the organization was tailored to adapt to the project‘s characteristics. In
other words, it answers the following questions:
How was the work divided among different groups and different managerial levels?
What responsibilities were retained by different groups to keep the workflow smooth and
undisrupted?

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1. Area Management
The area management organization is well suited for large scale projects where a single team
cannot handle the large size. It was applied on the I-595 expressway and Boston artery tunnel
where the projects were divided into separate manageable sectors.
In this organization, the works are divided among two management levels to ensure fast
response: the global management team and the area management teams. The global project
management team retains the global responsibilities of the project and the area management
teams retain the duties and responsibilities in their areas. The area management system is
decentralized to respond to decisions, variations, problems, and unanticipated conditions as fast
as possible.
The global management team is responsible of major construction items, global issues, and
overall project controls. In other words it is responsible for control cost, schedule control, global
project coordination, long lead items, approval of major changes, claims management, and other
issues that extend in more than one area. The global management team is positioned to ensure
the resource supply of all groups and adequate integration of works among different groups. In
order to conduct these duties, the global project management team is composed of senior project
directors, project managers, and senior construction engineers.
The area managers are responsible for the administration of all contracts in their designated
areas. In addition, they are responsible for coordinating their work with each other and with other
areas throughout the site. Accordingly, the lower level or field managers would have direct
responsibilities on their project portions i.e. total control of the construction process and decision
making authority. In order to conduct these duties, area management positions demand
experienced people with capabilities and experience in cost engineering, planning, scheduling,
contract administration, IT knowledge, and technical knowledge. It is usually composed of a
manager, support staff, number of resident engineers, field engineers, and quality assurance
inspection teams.

Figure 4: Area Management

Functional integration could be achieved using this management organization. The area
management staff would be changed according to the specialization needed as the project
progresses from phase to phase. For instance, in the Denver Airport project site management
responsibilities shifted from one area manager to another as the works changed i.e. site
preparation area manager changed to paving area manager.

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2. Area Management with Technical Support

This type of organization is well suited for large scale complex projects. It was applied on the
Denver Airport megaproject. As the project technical complexity increases, area management
teams are incapable to perform all engineering activities and functions in their designated areas.
In addition, the global management team would be incapable to follow up with the
overwhelming technical and the managerial processes. Therefore, more functional integration is
needed giving rise to the technical support group.
The support group functions vary depending on the needs of the area management teams. Its
functions could be technical (engineering), managerial, or even legal. The technical staff assists
area managers in their duties and reports to the global project management team. In many cases
the area managers would report to the support staff in engineering or technical issues. The
support staff is usually composed of experienced senior level support managers that include
specialists in management, safety, security, quality assurance, construction engineering, and
contract administration. Furthermore, the staff would develop program wide policies and
procedures and would ensure their implementation.

Figure 5: Area Management with Technical Support

3. Area Management with Functional Distribution

This type of organization is well suited for very complex large projects such as power plants.
Projects as such have a design that is complicated to construct where the services of many
engineering specializations are needed. This management scheme is similar to the area
management. However, all engineering trades are placed in each work group to ensure maximal
functional integration among different specializations.
The hierarchy starts with the project management team on top and subordinated by area
managers. Each area manager acts as a project manager in his area and is subordinated by
engineers with different specializations. Each engineer is subordinated by his own project
superintendents, foremen, and laborers. The engineers are responsible for the technical and
managerial aspects of the project and report to the project manager. The work group
specializations could be modified according to the complexity of each area or the phase of the
project.
This type of organization ensures substantial integration of different specializations within each
group. However, it does not ensure sufficient integration of specializations among different area
work groups.

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Figure 6: Area Management with Functional Distribution

4. Area-Functional Matrix Organization

This type of organization is well suited for complex and large projects where the coordination of
specializations among different areas is substantial.
In this management organization, each work group has to report to an area manager and
functional managers. The area manager would manage the works done in each area, whereas
each functional manager would manage the works of each specialization throughout the project.
This type of organization would ensure substantial integration of different specializations within
each group. Furthermore, it would ensure sufficient coordination of specializations among
different area work groups.
The two dimensional hierarchy starts with the project management team subordinated by two
groups: the area managers, and the functional managers. The two groups are subordinated by the
area work groups. Each area work group would include all engineering trades and would report
to both area manager and functional managers. The functional managers (engineers) would be
responsible for the technical aspects of the project. The area managers would be responsible for
the managerial aspects.
Reporting to multiple superiors could be troublesome and inefficient. However, procedures could
be established to streamline the works and make the managerial process more efficient. A similar
form of hierarchy worked well on the I-595 expressway where the roles and responsibilities were
delineated between the bosses to avoid conflicts and management inefficiencies.

Figure 7: Area-Functional Matrix

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B. Top Management Organization

The choice of top management organization would determine the level of integration of different
project parties. Furthermore, top management organization affects the production integration
since it influences decision making procedures and change procedures. The top management
structure is not simple since many public and private authorities would act as the owner.
Furthermore, many parties such as consultants would be employed to act as project managers
and as owner representatives.
In the classical owner-contractor organization, all decision making processes pass through the
owner or owner‘s representative. In the case of projects that demand a great deal of managerial
intervention, the owner-contractor decision making procedure would be slow and disruptive to
the construction process. Therefore, different organizations should be applied on megaprojects to
be able cope with their managerial demands. The following is a summary of the top management
organizations applied on different megaprojects and had different outcomes.

1. Independent Project Organization

The independent project organization (IPO) was applied at the Boston Tunnel/Artery project.
The decision making team was an integrated organization formed of the owner i.e.
Massachusetts Turnpike Authority (MTA) and a management consultant i.e. Bechtel-Parsons
Brinckerhoff (B/PB) under the direction of the owner. For instance, the best qualified person
available for a particular managerial position was selected regardless of which organization he
came from. The IPO structure was formed to improve integration through encouraging better
communication between the parties and producing more efficient decision making.
Unfortunately, the IPO structure did not resemble the usual owner-consultant relationship by
which the two parties operate independently. No clear lines of responsibility and accountability
were presented. This led to numerous problems, conflicts, and legal claims between different
parties.
2. Matrix Organization
As applied in the I-595 expressway, the organization was based on a matrix approach. The roles
and responsibilities were delineated between the owner and project manager to avoid conflicts
and management inefficiencies. The work load was divided by which the owner retained
technical, engineering, and administrative responsibilities. The project manager retained project
management issues (cost, work packaging, production planning and scheduling) and other
business related and integrative decisions. This form of organization performed well although
there was not considerable integration between the project manager and owner/consultant.

C. Planning and Design

Several advanced planning steps are necessary to better prepare the construction team adapt to
megaprojects‘ complexity and project size. Therefore, planning is not confined to the classical
scheduling and planning steps. Many items such as the design, long lead items, project schedule,
and procurement schedule should have better preparations.
The following is a list of advanced steps and recommendations of work practices applied on
different megaprojects that enhanced project integration and led to better project performance.

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1. Project Planning and Scheduling

Project planning and scheduling work practices could be applied to improve the work teams‘
coordination (production integration):
In the I-595 project, a task force composed of the owner and the management consultant
was introduced at early planning stages to develop the scope and the work plan. At this
stage all individual projects or work packages of the main project were planned.
Furthermore, the organizational structure was introduced before construction started
where roles and responsibilities were assigned to different managers in both
organizations.
The field team was familiar with the project one year ahead of commencement.
Furthermore, the construction schedule was set based on the input of all participants
where maximum flexibility was given for contractors to set their schedules.
The schedule should be relaxed as much as possible. Compressing the project schedule to
finish early and to limit the turnover of experienced construction managers would lead to
acceleration costs, haste approval of change requests, and schedule modifications.
Very complex and large scale projects demand several advanced planning steps. According to
the Department of Energy nuclear power plant assessment (2005), the following steps are
recommended:
The construction schedule should be prepared to the maximum possible extent.
The procurement schedule should be discussed with the suppliers and contractors to
ensure the availability of required material at the appropriate time. Furthermore,
according to the CII Project Definition Rating, each vendor should develop a resource-
based schedule duration and information so that the main contractor could integrate
different schedules and produce a final optimized one.
Long Lead Items should not be left to be finalized during the construction project which
would cause delays in case the items are not delivered in time.
The project team should prepare for changes and mistake corrections by adequate staffing
of response teams for problem resolution.
2. Design
Advanced work practices should be applied to improve the design completeness and
constructability. In other words, to improve the project functional integration:
In complex projects, the design should be complete to the maximum practical amount.
According to the Study of Construction Technologies and Schedules, O&M Staffing and
Cost, and Decommissioning Costs and Funding Requirements for Advanced Reactor
Designs, the design should be complete and all regulatory issues are fully resolved before
construction commences. At the Denver Airport project, the design-build approach was
used where the airport was planned to have future additions and the design was planned
to accommodate these additions. Unfortunately, this approach did not save time nor cost
because numerous changes were added. The additions caused a ripple effect of changes
throughout the project including the previously designed systems.
People with extensive experience in the construction of such projects should be used to
design the project.
Backup systems should be designed where new innovative technologies are tried.

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The utilities, project officials, material suppliers, component suppliers should ensure and
approve quality assurance/quality control programs ahead of the project commencement
date so that all standards and procedures are followed before misinterpretations and
nonconforming works are in place. Furthermore, regulatory issues should be resolved
before the commencement of the project.

D. Modular Work Practices

Modular work practices are used in complex and large scale project where different parts of the
project (modules) would be fabricated in parallel while site construction works are progressing.
After the module fabrication is over the modules are installed on the construction site using
cranes and work crews that would link different modules. Modular work practices are popular in
military ship yards, industrial plants, and power plants.
Modular work practices are necessary for complex large scale projects since they improve the
project performance:
They improve functional integration since they incorporate different engineering trades in
each module. The construction would be in a planned and systematic way following a
certain sequence that takes into consideration time constraints for trades, space
constraints for equipment and components, and project deadlines.
They improve production integration. Production would be much easier because there
would be less congestion (less interference) in the construction site, less crew inactivity,
and a lower number of interactions needed at the management level (less management
bottlenecks).
Construction production would be faster since it is possible to produce multiple parallel
modules while the site works are progressing. Parallel assembly helps reduce the risk of
overall project delay. In a parallel assembly, the delay caused by a single module being
manufactured does not necessarily slow down the overall project as in serial construction
activities since parallel activities are accompanied by float.
Construction of works in a shop is much faster than construction of the same works on
site. According to a study done by Bechtel Corporation on fabrication facilities in the
United States, The U.S. shipbuilders claim that 1 job hour fabrication in a shop
(dedicated factory) would take 3 job hours in an onsite temporary facility (site shop) and
8 job hours if done in-place (construction site) using tradition construction techniques.
The use of modular work practices improves quality, standardizes the works, and
optimizes them. Furthermore, they make the testing and commissioning process easier
since each module could be tested for all the systems before installation.
In order to apply the modular work practices, project officials should have the design,
construction, and manufacturing capabilities:
The use of 3D Computer Aided Engineering technologies that could support module
design. Furthermore, the firm should follow advanced steps in the design. For instance
the modules structure should be able to support itself, support the final product building,
and have a center of gravity for the ease of lifting. The electromechanical equipment
should be designed and placed for future ease of access and maintenance. Furthermore,
pipes and cables should be designed and placed for ease of connection with other
modules.

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The use of very heavy cranes, large transportation vehicles, and open top installation
technology to move and install modules with ease.
The use of RFID and supply chain database for tracking and managing module
components, labor, and other material and equipment.
The use of advanced construction technologies such as cable splicing, cable rollers, cable
lubricant, pipe bending technologies, and programmed robotic welding to connect
different modules swiftly with ease.

VII. CONCLUSION
Megaprojects are defined in their construction management context as large scale projects
characterized by a complex difficult design and complex organization. Megaprojects‘
characteristics cause significant project management difficulties that lead to poor
performance. Adequate system integration should be applied in order to improve project
performance through the application of the correct work practices. Several work practices
that were used in previous megaprojects are presented and analyzed in order to help
construction practitioners improve megaproject time and cost performance. However, more
research and analysis is needed to clearly assess the effectiveness of each of the work
practices when applied on different types of projects. Furthermore, the methods and work
practices should be evaluated by construction practitioners who have applied these methods
to determine their affect on outcome, project cost, and project time frame.

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