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Major Project Risk Management: Reconciling Complexity during Delivery with the Inside View in Planning

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  • Chapman, Paul
  • Quang, Cuong

Abstract

Recent research on the origins of risk during the planning and delivery of major projects broadly addresses two root causes: (i) complexity at the planning phase and also during project delivery, and; (ii) ‘the inside view’ at the planning phase and the associated issues of strategic misrepresentation and cognitive biases such as optimism bias. This paper presents the results of a systematic review that finds a schism in the literature showing theoretical and empirical treatment of project delivery risk polarises into considering either the effect of complexity or the inside view; rarely are they considered jointly. This work discusses the implications for theory and practice and identifies Case Based Decision Theory and Bayesian modelling, both of which are outside view techniques, as having potential to reconcile complexity and the inside view and thus provide for their joint treatment.

Suggested Citation

  • Chapman, Paul & Quang, Cuong, 2021. "Major Project Risk Management: Reconciling Complexity during Delivery with the Inside View in Planning," SocArXiv j9sw8, Center for Open Science.
    • Handle: RePEc:osf:socarx:j9sw8
    DOI: 10.31219/osf.io/j9sw8
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    References listed on IDEAS

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    1. LeRoy, Stephen F & Singell, Larry D, Jr, 1987. "Knight on Risk and Uncertainty," Journal of Political Economy, University of Chicago Press, vol. 95(2), pages 394-406, April.
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    4. Love, Peter E.D. & Ahiaga-Dagbui, Dominic D. & Irani, Zahir, 2016. "Cost overruns in transportation infrastructure projects: Sowing the seeds for a probabilistic theory of causation," Transportation Research Part A: Policy and Practice, Elsevier, vol. 92(C), pages 184-194.
    5. Renata Walczak & Tomasz Majchrzak, 2018. "Implementation Of The Reference Class Forecasting Method For Projects Implemented In A Chemical Industry Company," Acta Oeconomica Pragensia, Prague University of Economics and Business, vol. 2018(1), pages 25-33.
    6. Love, Peter E.D. & Ahiaga-Dagbui, Dominic D., 2018. "Debunking fake news in a post-truth era: The plausible untruths of cost underestimation in transport infrastructure projects," Transportation Research Part A: Policy and Practice, Elsevier, vol. 113(C), pages 357-368.
    7. Xin Wan & Guang Wang & Peng Yi & Wei Bao, 2010. "Similarity-Based Optimal Operation of Water and Sediment in a Sediment-Laden Reservoir," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 24(15), pages 4381-4402, December.
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    1. Oddrun P. Røsok & Mark L. C. de Bruijne & Wijnand W. Veeneman, 2023. "Dealing with Cross-Sectoral Uncertainty: A Case Study on Governing Uncertainty for Infrastructures in Transition," Sustainability, MDPI, vol. 15(4), pages 1-18, February.

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