The road to successful infrastructure delivery

Paul is a leading expert on the learning and development of executives, especially those responsible for leading the delivery of major programmes/major projects typically valued at more than $1billion.

Major Programmes Paul Chapman

Insights from research into England's National Highways

In the world of infrastructure projects, it's commonly believed that cost overruns and failure to deliver intended benefits are par for the course. But is this always the case?

To tackle this question, I focussed on road projects in England for my recent research. Using publicly available data from England’s National Highways (formerly the Highways Agency), I examined 138 strategic road network projects completed in England between 2001 and 2016.

Measuring success: More than just cost

In assessing the success of these road projects I started with the benefit-cost ratio (BCR). This compares the financial value of a project's benefits (like reduced travel time, improved safety, and economic development) to its costs. A BCR greater than one means the project's benefits outweigh its costs.

I found that most were economically successful, and the projects were effectively managed. The findings were striking:

93% of the projects delivered positive economic benefits, with the value of the benefits exceeding the costs.
69% of the projects achieved high benefit-cost ratios (BCR) of 2 or more, meaning that the benefits were at least double the costs.

Cost overruns: Not as bad as you think

The results were equally encouraging when it came to project management. The study found that the road schemes were typically delivered close to their budgeted costs:

The median cost overrun was a mere 2.4%
42% of the projects were completed at or below budget.

At the portfolio level, cost overruns were balanced by cost underruns, indicating that the overall financial performance was well-managed.

Improving over time

Perhaps the study's most intriguing finding was the significant improvement in cost performance over time. In the latter half of the study period (2009-2016), projects typically experienced a 6% cost underrun, a notable shift from the earlier years. The proportion of projects delivered on or under budget increased dramatically, from 33% in 2001-2008 to 61% in 2009-2016. This suggests lessons were learned, and improvements were made in project management practices.

Why the success?

The key to these cost-performance improvements was the adoption around 2007 of more effective project management policies and practices by National Highways. These included better cost estimation techniques, more rigorous project appraisal and approval processes, improved procurement strategies, enhanced programme management capabilities, and a systematic approach to evaluating and learning from past projects.

Interestingly, while the economic benefits of the projects also improved slightly over time, this change was not statistically significant. This suggests that the focus on improving project management practices directly impacted cost performance more than benefits realisation.

The findings of this study stand in stark contrast to the prevailing narrative in both academic literature and public perception, which often portrays infrastructure projects as prone to cost overruns and failure to achieve intended outcomes. Instead, my research presents a compelling case of a large portfolio of road projects in England that has been successfully delivered, with most projects providing positive economic returns and being completed within or close to their budgeted costs.

Implications for the future

The implications of this study are significant for both researchers and practitioners in the field of infrastructure project management.

For researchers like myself, the study highlights the importance of using transparent, evidence-based approaches to investigate project delivery performance across different contexts and types of projects. By replicating the methodology used in this study, researchers can benchmark practices and performance across organisations and sectors and gain a more nuanced understanding of the factors contributing to project success or failure. It is worth noting that I also conducted a similar study looking at the Swedish road and rail infrastructure where similar positive results were seen.

For practitioners, the study offers valuable insights and a glimmer of hope. It suggests that consistent project success is achievable by adopting effective policies and practices, such as those implemented by National Highways. These include robust cost estimation, strong governance frameworks, and a commitment to continuous learning and improvement.

The study also reminds us that while some projects may experience challenges or fall short of expectations, it's important not to let these instances overshadow the many successful projects delivered within budget. By learning from the experiences of organisations like National Highways, project managers and policymakers can work towards delivering the infrastructure society needs while being responsible stewards of public resources.

In conclusion, the study of England's road projects is a powerful counterpoint to the prevailing narrative of infrastructure project failure. As governments worldwide continue to invest in major infrastructure projects – for example the EU Green Deal, the US Bipartisan Infrastructure Bill, the Saudi Vision 2030 - to stimulate economic growth, improve quality of life and tackle the climate crisis, studies like this one provide a timely reminder that success is possible with the right approach. With the right policies and practices, and a commitment to continuous improvement, organisations can consistently deliver successful projects that provide the critical positive economic and social benefits that we need.