A paper first published in The Manhattan Institute's City Journal, Autumn 2007 © The Manhattan Institute. Reprinted with permission.
Published here March 2008.

Introduction | The Original Concept | A New Approach: Mitigation | A Clever Political Strategy
Successful Innovative Technology | Cost and Questionable Accounting | Misplaced Responsibility
Allocation of Project Risk and Responsibility | Political Power, a Warning | Conclusion

Misplaced Responsibility

But the Big Dig's biggest pitfall was that Massachusetts never understood a basic fact: that it couldn't pay someone else to assume its own responsibility for an immensely complex, risky project. As the National Transportation Safety Board (NTSB) would later say in its report on the 2006 ceiling collapse, Bechtel and Parsons, the state's long-term consultants, were "performing the role that would normally be carried out by a government agency, specifically, the state highway department."

Since costs turned the Big Dig into a scandal, the public has often seen Bechtel and Parsons as its villains. The perception in Massachusetts, never dispelled by state officials, is that the duo's thousand-plus white-collar workers ran the Big Dig. Their numbers, dwarfing the few dozen public-sector counterparts, expertly controlled and manipulating designers, contractors, and information, without letting anyone else have much say. And that includes from colleagues at lowly engineering firms to meddling public officials. But even assuming the worst, and the reality is more complicated, people usually can't manipulate you unless you let them.

As early as 1991, the state's inspector general warned of the "increasingly apparent vulnerabilities ... of [Massachusetts's] long-term dependence on a consultant" whose contract had an "open-ended structure" and "inadequate monitoring." The main deficiency, as later IG reports detailed, was that Bechtel and Parsons, as "preliminary designer," "design coordinator," "construction coordinator," and "contract administrator", were often in charge of checking their own work. If, say, the team noticed in managing construction that a contract was over budget because of problems rooted in preliminary design, then it didn't have much incentive to speak up.

The state should also have known that when consultancy work will last for years and when consultants plan to introduce technologies so sophisticated that they can overwhelm the state's ability to oversee them, the state is going to wind up in a vulnerable position. Massachusetts would have been smart to introduce some checks and balances early on. Perhaps they could have split the work that Bechtel and Parsons were doing into smaller parts, having separate consultants for preliminary design and for "project management" work, or keeping some of the "management" in house.

Instead, in 1998 and in the name of cost efficiencies, the state further blurred the distinction between public and private sectors by folding Bechtel and Parsons employees and its own workers into one "integrated project organization". Multiple layers of theoretical oversight, including supervision from federal highway officials as well as the feds' General Accounting Office, made the new organization chart immensely complicated. And although the state's Massachusetts Turnpike Authority was at the top of the new organization chart, the state designated Bechtel and Parsons as its "owner's representative" in some areas, complicating even further the answer to the straightforward question: Who was in charge?

Massachusetts's laissez-faire attitude followed from a fundamental misapprehension: that Bechtel and Parsons were their partners, not outside consultants, and were thus assuming some performance risk. In a 1994 interview, Kerasiotes, then the state's transportation secretary, argued that Bechtel's incentive to perform its job properly was its reputation: "Go to San Francisco, walk in the lobby" of Bechtel's headquarters, he suggested. "What you're going to see [are] prominent pictures of the Central Artery ... . If they are causing this project to screw up, ... they're not going to market themselves that way."

Cost and Questionable Accounting  Cost and Questionable Accounting

Home | Issacons | PM Glossary | Papers & Books | Max's Musings
Guest Articles | Contact Info | Search My Site | Site Map | Top of Page