According to a recent study conducted by Dodge Data & Analytics, a leading construction research firm, 85% of owners experienced capital projects that exceeded the original budgeted cost; 92% percent shared that their CIP had projects that exceeded planned schedule; and 63% percent of their projects suffered quality deficiencies.
Those are pretty poor statistics that are corroborated by another important study conducted by McKinsey & Company which shows that 98% of projects suffer cost overruns of more than 30 percent; 77% are at least 40% late.
The reality is that most capital projects have significant risks and uncertainty associated with them and unless CIP teams do something differently, they can expect the same results.
Even just hearing this, you may be tempted to think:
“Our projects are simple, and we do them all the time. This risk does not apply to me.”
If you find yourself falling into an over-confident posture, I would urge you to speak with the executive stakeholders in your organization and find out if they agree. You may be surprised with what you learn.