A recent study from Booz & Company, a consulting firm that has worked with major clients in the construction industry, shows that there is an opportunity for $40 trillion in construction cost savings over the next two decades. Construction megaprojects are large-scale projects that have high costs and schedule overruns. To avoid the overrun, construction companies must make smarter and more informed decisions in pre-construction services. Several factors contribute to the high costs and delays of megaprojects.
The decision-making execution process risk is low during the first several months, but then it increases at an increasing rate from the ninth month to the final project completion. The rate variable RV2 shows a steady increase throughout the period. Early-stage megaprojects may show weaker effects of risk, but if they are not properly controlled, the increment rate RV2 will rise. For example, if a project has too many risks, its technical decision-making scheme can increase risk.
Technical decision-makings play a critical role in construction megaprojects. These projects involve high levels of complexity and subject cognition. Because of these factors, identifying and understanding these risks is critical for successful construction megaprojects. While TDMRs are diverse and complex, there is a paucity of systematic research on these risks. This study used grounded-theory to understand the dynamic complexity of TDMRs in megaprojects.
Contractual risk allocation is also a key component in megaprojects and construction model. Careful contract drafting attempts to allocate legal consequences among parties and shift project risks away from the owner/lender. However, careful contract drafting cannot guarantee risk elimination entirely. Effective project controls and proactive project management are necessary to minimize the total risk exposure. With these practices, megaproject managers can better manage the risks that are associated with megaprojects. These measures will prevent major risks and maximize the benefits of megaprojects.
The major issues associated with TDMR management in megaprojects are limited supply and talent capabilities. The limited number of construction companies tackling megaprojects has caused capacity issues, which hinder productivity. Supply chain problems can also raise the total cost of the project. Fortunately, Engineering Grade AR is solving the talent capability issue and enabling the world’s largest construction companies to take on megaprojects. And while this technology is not perfect, it can help megaprojects grow and flourish.
TDMRs in megaprojects are highly complex, dynamic, and difficult to control. Furthermore, the perspectives of individual project managers may differ from those in the literature. The importance of exploring TDMR dynamics is critical for both scholars and project managers. A risk assessment will help build an informed framework for the development of construction megaprojects. These methods are both time-efficient and effective in reducing the risk associated with megaprojects. This study is an important step forward to building safe megaprojects.
