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

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.