The Importance of Capital Project Planning

There is an old saying in the real estate business – you can’t “operate your way to success” if you make a bad deal. The long term success of a project has everything to do with the initial deal – If you bought real estate in a bad location or you paid too much – you will feel the impact of it for many years and there is little you can do operationally to overcome the issues.
 
That explains the importance of project planning. It’s all about strategic facility planning and selecting the right project to move forward with. If you pick the wrong project – or you pay too much for it – the long term negative impacts are often insurmountable. On the flip side, good planning will produce an incredible return on investment.
 
Planning consumes relatively few resources (i.e., when compared to building or buying the wrong project). It takes internal resource time, a disciplined set of steps and little else to go through the process. So why don’t more organizations put the emphasis on this process that it deserves?
 
I have a theory on this. From what I have seen, there are two big picture reasons why organizations’ planning process leaves something to be desired.
 
1. They Don’t Follow A Process On Purpose
Some organizations are very political (I know . . . can you believe it?). Projects are not prioritized and selected to support specific strategic goals and objectives. Instead, they are influenced by political criteria such as: (1) who is asking for it? (2) How important is this person? Or (3) How “powerful” is this person? When you hear the term, “pet projects” it’s a warning sign. On their face those projects don’t make much sense, but you dig around and find out that they were selected because they “belong” to someone.
 
You don’t have to look far to find examples of organizations where the planning process does not exist or is heavily influenced by politics. In our own Broward County School District, the Board allegedly authorized construction of multiple schools that were not really needed costing taxpayers tens of millions of dollars. In this scenario – which unfortunately happens in way too many organizations across our country – a rigorous and methodical planning process can negatively impact the goals of elected or appointed organizational leaders. So it does not exist. Or the process is purposely unclear, hard to implement, etc.
 
2. They Have a Process but No Way to Enforce it
Many organizations have a good process in place but no way to make sure it is executed well. The planning process deals with long range, multi-year issues. Over time, employees come and go. Planning information “lives” in multiple data bases or in spreadsheets or in many cases in employees’ brains. As people move around, this information is lost. Subsequent planning decisions are made with partial or incorrect information.
 
There really isn’t a good way to make sure that a process is followed consistently year after year and by every person involved. There isn’t a good way to ensure that everything is properly documented either, so that the knowledge “lives” in a centralized database that can be accessed by those that need it. So it’s not the process, but the execution of the process that leaves something to be desired. This problem is easier to address by implementing an enterprise project management software that enforces a process, ensures accountability, provides stakeholder visibility and captures all of the documentation.