Process approach in design of industrial megaprojects

Industrial megaprojects may experience cost and schedule overruns in excess of 30% and 15% respectively. Given that these projects have budgets over $1,000,000,000 (some have budgets exceeding $10 billion dollars) and multi-year schedules, this represents a massive potential loss for owners and construction companies. Companies involved in megaprojects must rely on their business and field work processes to control the huge amount of work that takes place and to reduce the likelihood of major cost and schedule overruns. Quality Management philosophies such as ISO 9001 and Total Quality Management require a process approach to work activities. Rework is the biggest single contributor to overruns and the majority of rework originates in the Engineering phase. This paper discusses complexity, rework, and other factors that influence cost and schedule overruns, then identifies 22 processes that are critical to engineering design work on industrial megaprojects and briefly discusses their contribution to the completed design. It then looks at 11 commonly problematic design areas and identifies the design processes associated with each of the areas. The process approach is then examined to determine if it is suitable for addressing the problematic design areas and improving design quality. This analysis assists technical engineers, project engineers, and project managers efforts to reduce the severity of cost and schedule overruns.