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Case Study: Central Artery/Tunnel The Big Dig

Introduction and History


Megaprojects in transportation are recognized as a major factor in economic development in the U.S.
The United States Department of Transportation identified that constructing roads, bridges, transit
systems, and airports can spur the creation and growth of small businesses (USDOT 2011). Also
studies conducted by the U.S Treasury in 2011, indicate that public infrastructure investments have
higher returns and productivity gains on private sector than private capital investments, this research
showed that a well designed infrastructure investment can raise economic growth, productivity and land
value while also providing significant positive spillovers to areas such as energy efficiency, public health
and manufacturing. But there is a legitimate concern observer may raise about the inherent risks of
multi-billion-dollar construction and transportation megaprojects? Is there a track record of such projects
with overrunning cost far more than initially budgeted accompanied with large time delays? There are
indeed such risks, and no major construction/transportation megaproject exemplifies this better than
Boston Massachusettss Central Artery/Tunnel project, which is commonly referred to as The Big Dig.
From this study important lessons on construction megaprojects can be learned.
A megaproject can be said to be a Complex Products and Systems (CoPS) with high value, it integrates
many interacting components and subsystems and it is mainly purchased by large businesses or
government agency and not mass-produced. (Carlos Sato, 2015). The Boston Massachusettss Central
Artery/Tunnel (CA/T) project is a one-off CoPS project, which conforms to important dimensions of a
CoPS project such as financial scale of project, quantity of sub-systems and components (refer to
appendix 1 for critical product dimension for Cops). The Big Dig is considered as one of Americas
foremost megaprojects; the largest and most complex urban transportation project in the history of the
America (Bechtel, 2008).
The Big Dig has created both a positive and negative legacy for itself. From an engineering perspective
it is a big breakthrough as it devised new techniques and methods for construction, replacing the
congested six-lane elevated highway with a technically challenging eight to ten lane underground
expressway(a set of tunnels) and new bridges (Bechtel, 2008). The completed and fully operational
project exceeded all set expectations of reducing traffic congestion, therefore saving time. The study by
EDR Group estimated the timesaving per year to worth $177 million, $120 million per year in new
property tax revenue, thanks to $7 billion in new development made possible by removal of the former
elevated highway. But from management perspective, the big dig was in a state of disorder. The initial
budget was set at $2.6 billion (in 1982 dollars) and ended up costing $14.8 billion (2007 dollars) a cost
overrun of approx. 190%, also its development dragging for almost two decades (Bechtel, 2008). The
state (Tax payer) currently pays over $100m annually in debt service for the project, which is likely to
continue till 2038. It still owes about $9.3bn in both principal and interest (Boston.com). It is a financial
disaster. Quality control was also a disaster, as evidenced by defective concrete work, thousands of
leaks, 2004 slurry wall breach within the I-93 Tunnel, and the fatal ceiling panel collapse of 2006 in the
I-90 Connector Tunnel( Bechtel , 2008)

Project Goal
The big dig was developed as a response to the chronic traffic congestion on the central artery (I-93),
which carried 75,000 vehicles a day approximately and had an accident rate four times the national
average for urban interstates (Bechtel, 2008). Planning for the big dig official began in 1982 (McNichol
and Ryan, 2001) with a goal to replace the elevated six-lane I-93 with an eight-lane, mainly
underground directly under the existing road, a new bridge crossing the Charles River and construction
of a new four-lane expressway to extend I-90 from its then-terminus downtown eastward to the airport
through a tunnel. The project involved a big, new I-90/I-93 interchange. Though only 7.5 miles in overall
length, it encompassed 161 lane-miles of roadwork.

Type of Project and Project Successes


Project success has traditionally been measured by (H.Kerzner, 2006) against the triple constraint of
performance; scope, schedule, and budget. However, this definition has proven to be partial and
sometimes misleading. As sometime projects, which failed to meet the triple constant, were later
consider a success when it became operational such as the Sydney opera house whilst those which
meet the constraint failed in operation such as the Iridium satellite phone. A more suitable approach to
defining project success is to Shenhar, Dvir, and Levys five dimensions of project success, this is used
to define the project success dimensions for the Big Dig as shown in the figure below.

Project
success

Impact on
customer

Efficiency

-1982 till 1998


-$2.8billion
-5 miles of
tunnel
-6
interchanges
- birdges
-replace the
rusting
elevated sixlane Central
Artery

Improved
Traffic
circulation
-

Impact on
team

Business and
direct
success

- Skill
developeme
nt
-Team
member
growth
-team
morale

-Attract new
investors for
the city
-Link both
side of the
city together
-Reducing
traffic
-Creation of
open space

Preparation
for future

-worker and
safety
innovations
Developmen
t of freed 25
acres of land
-New
capability for
Massachuset
ts Turnpike
Authority
(MTA), the
US Federal
Highway
Administrati
on

Figure3:ProjectSuccessforBigDig

AccordingtoShenharandDvirprojectsaretheonlywayorganizationscanchange,implementastrategy,
innovateorgaincompetitiveadvantageisthroughprojects(ShenharandDvir,2007).Yetmostprojectscarried
outbyorganisationareregardedasafailure.InastudyconductedbyShenharandDvir(2007),collectingdataof
morethan600projectsinbusiness,governmentandnonprofitsectors:85%oftheprojectsfailedtomeettime
andbudgetgoals,withandaverageoverrunof70%intimeand60%inbudget.Fromtheprojectsuccessabove
figure3onecanconcludethebigdigprojectfailedtomeetsomeofitsrequirementssuchasefficiencydimension,
withtheprojectcompletionbehindscheduleandacostoverrunof190%.Canthesefailuresbeattributedtothe
projectbeingmanagedinthewrongway?Firstlyallprojectsshouldnotbemanagedinthesameway,different
types of projects must be planned and managed differently in order to succeed, so
attempting to apply the one size fits all approach may lead to a project failure. For
example a construction project is very different from a high-tech research program in
several ways, including how each is managed. Shenhar and Dvirs Novelty, Technology,
Complexity, and Pace (NTCP) diamond framework is one way of classifying project
according to four dimensions such that the values attributed to each of these dimensions
indicate a recommended style of management for increasing the likelihood of the projects
success.

Before developing a NTCP diagram to indicate the style of management used on the big
dig, it is best to review and analyse the literature to gain a better understanding on some
of the best practices and pitfalls of the project.

The Project life cycle


The project life cycle of CoPS is difficult to define in traditional project life cycle as several phases,
which inter-relate making it difficult to define where one phase ends and the next phase begins. The
functional activities in CoPS projects work in reverse unlike mass production where the product has to
be ready before sale to a customer. CoPS sells first then produce, it follows the process where the
customers requirements are stated, suppliers are then invited to propose (via Invitation to tend) and bid
on how then intend to match the requirements, then suppliers are chosen to develop the project with
the user.

Invitationtotender(ITT)
Research into the bid management style or basis for assigning the joint venture of Bechtel and Parsons
Brinkerhoff (B/PB) as management consultant for the Big Dig is not explicit detailed, following numerous
reports of corruption experienced during this project, which some have labelled as Americans greatest
Highway robbery(BigDigHighwayRobbery). My assumption is that some form bribery might have been
involved.
However it is important to discuss the bid management style used by B/PB to award design contracts
and construction contracts. For design contracts, design consultants were ranked according to
qualification criteria, and the highest ranked were invited to submit a fee proposal, which was then
compared to estimates made by B/BP to conclude on a contract value. For construction contracts, a low
bid methodology was used in awarding contracts. This action resulted in contractors applying for
frequent claims and changes throughout the project life cycle therefore overrunning cost .
The Best value methodology, similar to the methodology used by British Telecom for its 21TCN
megaproject is more efficient methodology for reducing cost and selecting more qualified contractors.
This style can be divided in three stages:

First stage: Pre-ITT socialisation, this event was launched where the requirements are clearly
defined to a general market prior to the formal ITT. The idea is to identify the potential suppliers.

Second stage: Formal invitation to tender is issued to potential suppliers, full technical and
commercial responses required.

Third Stage: Shortlisting and selection of final suppliers based on commercial & technical bases

It is also important to specify a hospitality policy, so has to control and mitigate bribery and corruption in
the bidding process.

The Project Organization


The Project Based Organization (PBO) was the organization structure adopted for the Big Dig, its ideal
for managing increasing product complexity (Andrew.D, 1960). Although responsibility for the Big Dig
was quite unclear, the project owner which was the Commonwealth of Massachusetts, was represented
by Department of Public Works (DPW) initially, although the Massachusetts Highway Department
(MHD) was the recipient of federal funds. Ultimately nominal control was later passed to the
Massachusetts Turnpike Authority (MTA). There is no clear documentation on how the management
consultant was selected but from its inception in 1985, a joint venture of Bechtel and Parsons
Brinkerhoff (B/PB) managed the project, as megaproject was deemed too large for one consultant
along. (Bechtel, 2006). The B/PB was responsible for design, providing technical support during

construction, handling environmental issues and oversight of other sub-contractors. The Figure 5.3
below graphically displays the flow of obligations amongst the various participants.

The Decision to use the PBO structures is justified. According to (Gaan, 1998) PBO is a natural
organisational form for CoPS especially when several partner suppliers are engaged with the user
through various stages of innovation and production. PBO is also best suited to very large, risk
intensive projects where resources have to be combined and shared with other firms as illustrated by
(Andrew.D, 1960).

The Project Web


The table below briefly illustrates some main actors involve in the big dig.

Customers/Environme
nt/Owner

Massachusetts Turnpike Authority

Prime Contractor/
Systems Intergrator

Bechtel/Parsons Brinckerhoff

Sub system suppliers

Jay Cashman, Modern Continental, Obayashi


Corporation, Perini Corporation, Peter Kiewit Sons'
Incorporated, J.F. White, and the Slattery division of
Skanska USA e.t.c

The Big Dig is a complex project; as such it involves the careful integration of many sub components.
As Simon Ramo of Ramo Wooldridge and systems integration expressed it, System Integrators act as a

cure for chaos. The assigning of a joint venture Bechtel/Parsons Brinckerhoff as prime contractor/
system integrator in the Big Dig project will provide a number of advantages, which includes integrating
components, skills, knowledge, services from other firms to produce ever more complex products and
services, creating better communication channels with several suppliers/subcontractors and acting as a
project manager for the customer. It is important to note that there are limits to a SI, not a substitute for
good leadership and management as it often ignores soft human side.

Financing the Big dig


The Big Dig just like many other construction CoPS depend upon multiple sources for financing;
including both public sector and private sector. The Big Dig was entirely funded by the public sector
while a private sector management consultant carried out construction, thus the Big Dig Public-Private
Partnership (PPP) structure combines public finance and private sector management. The initial
budget was set at $2.6 billion and ended up costing $14.8 billion with its development dragging for
almost two decades. This is a clear indication that things did not go according to plan financially. The
question needed to be asked here is: Was this structure of PPP appropriate for the project and did this
contribute to the project cost overrun? A study on megaproject by Greiman (Gremian,2013) identified
two other megaprojects, the Eurotunnel with a financed and managed privately PPP structure and the
Mozal project which was a combination of both private public sector funding, It highlighted that neither
the publicly funded projects nor the privately funded Eurotunnel successfully kept to schedule or cost
control, yet the Mozart project with a combination of both was 6 months ahead of schedule. It is useful
to point as there is no universal answer to project financing. However Gremian suggest that it is good
practice to always form PPP highlighting the points of risk shifting to parties who can manage the risk
better and delivering better quality of service. (Gremian, 2013b)

Risk Management
The main cause of cost overrun mentioned by Flyvberg is the lack of realism in initial cost (B.Flyvberg,
2004. P3). In reducing the cost overrun a clear definition of PPP that emphasizes on allocating risks to
parties who have an incentive to reduce the negative impact is best. Flyvbjerg suggests that the choice
to continue with a project ought to be in view of the eagerness of private financiers to take part in the
megaproject without a sovereign guaratee. By putting their own capital at risk, such private financiers
will be more involved in checking how the task is done, to relieve the danger to themselves. What's
more, if such private financiers timid far from putting resources into megaproject, that ought to be a
indication to government that the task may not be monetarily supportable or even reasonable.
The Build-operate-transfer (BOT) model, under which a private consortium acquires a long-term
proprietorship interest in the megaproject, is recommended. For this to work effectively in reducing cost
overrun it is important the length of the ownership should be long enough for the private consortium to
have a high probability of making a return on the investment. In light of this long stretch of responsibility,
the private consortium will have an incentive to construct it right to minimize lifecycle costs. This model
will provide responsibility, accountability and risk management to the project, which the traditional
government-commanded model essentially does not give.

Sustainability in the Big Dig


Sustainability requires maintaining operability, services and the benefit of a project during its life time.
This is particularly important as the community is forced to live with the project outcomes
,to maintain the Big Dig integrated programs which followed centralized processes and procedures
where established with the goal of maintaining the operability and benefits. These model of intergration
are highlighted in the figure below.

These integration models are a good practice to follow as they help ensure sustainability and economic
growth, avoid repression of investment returns by government and possible changes to life expectancy.

Actual and Required Management style

As stated earlier in the project successes, the NTCP diamond can be used to show the gaps between how the Big
Dig project should be managed and how it was actually managed. From analysing some aspects of the project life
cycle and studying literature on the Big Dig, alteration can be done to the classification of the project on the NTCP,
as this will result in a management style more suited to achieving the project success.

Complexity
Actual: System / Array
Required: Array
The project complexity was classified in-between a system and an array as the project was
identified early on to be a very large-scale project, this resulted in the forming of a joint venture
to build up capabilities to manage and delivery the project successfully. Sadly this wasnt the
case as the joint venture was short of the required capabilities to meet all dimensions of a
project success. In my opinion the required classification for the complexity of this project is an
array(widely dispersed collection of systems with a common mission), this classification will
result in a higher complexity in organisational structure.
Technology
Actual: Low-tech
Required: Medium-Tech
The project technology was classified as a low tech which is not usually for a construction project, the
required classification for the technology dimension is a medium tech as the challenges faced by the
big dig which includes the unfavourable conditions; such as sea beds, bad textured soil etc., are the first
of its kind. If classified with a higher level of uncertainty i.e. medium tech, the project could have been
managed to accommodate increased design and development activities, frequent technical reviews in
addition to usual managerial reviews. As such design flaws such as the 1000s of leaks, 2004 slurry wall
breach within the I-93 Tunnel, and the fatal ceiling panel collapse of 2006 in the I-90 Connector Tunnel
might have been avoided.

Novelty
Actual: Derivative
Required: Platform /Break through
The Big dig was classified as a derivative, an improvement to the existing central artery (I-93) highway.
The required view for novelty for this project is between a platform and breakthrough, the novelty level
affects the ability to determine requirements, from the construction phase one can identify a number of
instances where bad choice of materials or substandard material used led to disasters, one of the high
profiled disaster is the collapse of a pillar which took the life of a motorist, research on the cause of this
collapse indicated that the wrong number of bolts were used to hold the pillar in place. Although the Big
Dig is a construction project, the size and constraints against the Big Dig where enormous, it need to
devise new techniques and methods for construction. This is made evident by the fact that every other
construction mega project takes on the lesson learnt from the Big Dig to develop their procedure and
organization structures, construction techniques, risk management strategy e.t.c

Pace
Actual: Regular
Required: Regular
Unlike a Time critical or fast and competitive project delays in the CA/T project was not critical to its
direct success and as such it was viewed as Regular which is appropriate for this project.

Conclusion
Mega projects will always struggle with unforeseen events, massive regulatory requirements, technical
complexities, community concerns, and a challenging political environment. The Big Dig after
completion was successful in its overall project goal of reducing traffic congestion, the biggest negative
to the Big Dig is the huge financial debt it has place on the tax payer/state. The biggest lesson learnt
from this megaproject is to shift the risk to the investor, as this will produce a high degree of focus on
the project. Other lessons we have learnt from this project is that carrying out functional activities the
way they have been donein other constructed projects does not work for CoPS project one size does fit
all, appropriate bid management system should be used in screening and selecting contractors, also
project integration is critical to success and while a system integrator will greatly help in combining
capabilities to develop the system, reduce chaos, it is not a substitute for good management and
leadership.

Appendix 1

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products and systems . Cambridge: Cambridge University Press.


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