Abstract/Summary

This report summarizes the insights of a three-year study on “megaprojects”—the project-based organizations purposely formed to develop capital-intensive infrastructure. Our aim was to further our understanding of what form of organizing work a megaproject is and investigate the extent to which we could trace empirical regularities in the performance of megaprojects back to their organizational structure. Our central claim is that megaprojects are a meta-organization—a network of legally independent actors collaborating under an identifiable system-level goal. In this study, we conceptualize the megaproject organization as formed by two constituent parts: core and periphery. The core members control the strategic choices that define the project output and the development process structure. The core is made up of the promoter and multiple autonomous actors who have direct access to the strategic decision-making process because they control critical resources, Within the core structure, the project promoter cannot use unified authority to get things done. In contrast, the periphery is formed by suppliers selected by the promoter to execute the strategy agreed by the core members. Armed with this conceptualization of a megaproject organization, we tackle the issue of performance. Deep-seated norms establish that a “successful” megaproject is a project in which the scope is frozen early on in order to deliver the project on time and within budget. These norms are rooted in the professionalization of the project management practice in the 1950s. Since then, the world has become much more crowded and interconnected by technology, but the norms have yet to adapt. Thus, it is hard to see how megaprojects today, with their pluralistic structure at the core, cannot “fail” in the eyes of third parties. This is troubling because megaprojects are a source of value creation. It is also unfair to the leaders of these complex enterprises who deserve our sympathy, not blame. By revealing the organizational structure of a megaproject, it is our hope to contribute to debunk the megaproject performance myth.