A paper presented to the first Engineering Congress, The Institution of Engineers, India - Calcutta, January 1987.

Published here June 2001.

Introduction | Definition | Traditional | Hard-Soft | Environment
Characteristics | Concepts | Control | Breakdown | Fundamentals
Prerequisites | Summary | Appendix A | Appendix B

This paper looks at the difficulties of managing modern capital projects and endeavors to reduce the complexities to simpler and more understandable terms. It examines the project environment, defines project management and discusses points of difference from traditional management. A major technique for handling any project, the Work Breakdown Structure, is discussed and rules and guidelines are suggested. The paper concludes with some essentials for success.


Significant advances in technology, especially in communications have raised the expectations of most people of the world. I understand that India has a current five year plan (1985 to 1990) which is aimed at providing basic food, health and education for all of her population which will reach one billion persons in the year 2000. This current plan fore-casts government spending to reach over $140 billion US. Approximately $18 billion US of this is to be spent on transportation, $22 billion on social services, $30 billion US on agriculture and over $40 billion US on energy projects. This is an ambitious plan indeed, and represents a massive program of project work.

However, severe economic strains have developed in international trade over the last decade, resulting in difficulties in capital markets and with levels of external debt. This has necessitated a serious reappraisal of how projects, especially capital projects are brought to successful completion. This is just as true in the West as it is in the East, the North or the South.

The high cost of money puts a special premium on the time it takes to complete a project and how well it is managed. Delays and poor management may substantially reduce the effective benefits and quality of a project. Not only this, but in forcing a poor project to completion, money and other resources will be drawn away from other vital and needed project opportunities.

Even with good project management, a host of problems usually beset the average capital project. This is especially true in a developing nation, where political, economic, social and physical difficulties impede progress causing serious delays in completion or even failure. In Appendix A to this paper I have listed some of the most common problem areas and situations encountered in overseas project management. The major headings include:

  • During Concept Development
  • Environmental Conditions
  • Market Conditions
  • During Planning
  • Organizational Difficulties
  • During Execution
  • Control Difficulties
  • Start-up and Operating Difficulties

So after all that bad news, I have some good news. Project management is really very simple. The rest of the bad news is that it is people that make project management difficult!

As projects become larger and more complex, the effective management of them becomes relatively more significant to a successful outcome. How well the project is managed will generally far outweigh how well any of the specific technical roles are performed. Thus, putting in place competent Project Management capability long before putting in place appropriate design, engineering or construction capability is essential.

The difficulty is that on almost all capital projects, there will be a number of people involved who do not really or fully understand the process of bringing a capital project on stream. Without embarrassment, I include owners, sponsors, financiers, bankers, operators, politicians, lawyers, accountants and, I regret to say, even engineers. This is because Project Management is a particular but logical concept of management applied to project-type work.

So let me begin with some definitions, and compare project management to traditional management.


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