The purpose of projects
Insights from Basque Country for everywhere
Back when I was starting to work on human rights and business, an energy company representative bemoaned the “tyranny of the project”. However much some within the company had the intention of engaging thoughtfully with the surrounding community and minimizing harm, in practice, projects’ cost and timeline demands ran roughshod over those intentions.
Whether it’s infrastructure or buildings, the dictates of delivering “on time and on budget” still rule. Given that focus, you would have thought that at least those two requirements would be met in most instances. But not so, according to a database of over 16,000 infrastructure projects – from buildings, to energy facilities, to the Olympic Games – developed by Bent Flyvbjerg and his team at Oxford Global Projects. Analysis of the data revealed that a remarkably small 8.5% percent actually got delivered on time and on budget. And only 0.5% were completed on time and on budget and produced the expected benefits. In other words, 99.5% did not deliver as intended.
Perhaps it is time to think more widely, more creatively, and more long term, about the purpose of projects, of all kinds. Investing time to explore the “why” at the outset – which sounds a no-brainer but is often overlooked – can pay dividends in the medium to long term. It creates a solid framing for the course of the project and beyond, within which there is still plenty of room for innovation and iteration along the way.
I came across the infrastructure projects database via an article on Frank Gehry by Flyvbjerg and Dan Gardener, in Harvard Business Review. (When at airports I have a tendency to splash out on glossy magazines that I wouldn’t usually purchase, leading to serendipitous content encounters). The article shares the story of Gehry’s design process for the Guggenheim museum in Bilbao. The regional government had had in mind the conversion of an old wine warehouse in the centre of town into an art gallery. Gehry paused to ask multiple questions at the outset, beginning with the fundamental one:
“Why are you doing this project?”.
The city representatives spoke about the decline of the Basque industrial region – particularly its steel and shipping industries – and the vision of a museum that could do for Bilbao what the Sydney Opera House did for Sydney. Then let’s re-think the approach, Gehry said – let’s create the museum on the river-front, near a striking bridge.
Today, there would hopefully be a stronger draw to renovation and re-building of old structures, over building new. But that aside: the museum was delivered on time, within six years, and cost $3 million less than the $100 million budgeted. While the ambitious goal was to draw 500,000 visitors to Bilbao each year, four million came in its first three years.
This is one kind of innovation of course – galvanizing inward investment through a dramatic anchor institution. The Basque region has drawn attention for an altogether different form of economic innovation too. Mondragon, based in Basque Country, is the World’s largest employee-owned cooperative. It’s an association of ninety-five cooperatives in industries as diverse as bicycle manufacture, industrial machinery, grocery, technology and consulting, which in 2021 brought in over eleven billion euros in revenue. The ratio between the salary of the highest and lowest paid employee is 6 to 1. By comparison, an Economic Policy Institute study on America’s largest companies found that, in 2020, the compensation ratio between CEOs and typical workers was 351 to 1.
Both the Bilbao Guggenheim and Mondragon begin with a deep questioning and interrogation of purpose – of a project, of a business. Ideally, this questioning will always encompass “who” the project is for, who may be impacted now and into the future, and whose views should be taken into account. Ultimately this will generate value well beyond numbers on the balance sheet. Who knows, maybe more of this approach will mean more projects being delivered on time and on budget too.
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More reading:
“Bilbao - New York” is a beautiful short novel by Kirmen Uribe, translated into English from Basque.
An earlier piece by me on what the 2021 Pritzker Prize for architecture has to say about social value.
And finally: Just as Gehry’s sketch above gives a sense of possibility - I was blown away to encounter sketches for “Nighthawks” at the recent “Edward Hopper’s New York” Whitney exhibition. Hopper looked in an original and deeply engaged way at the city’s built environment, with an ability to bring the viewer into the lonely, disconnected and yet – through that loneliness and disconnection – connected, experience of being in the city.
