In Risk Management, we shall learn from the past, so we can avoid or plan the response to prevent the same obstacles happen in our project. This article is based on my sharing session at one day workshop CENS UI & my teaching class at Bung Hatta University, Padang

Risk is a history, and history repeat itself. Those who don’t learn history, are doomed to repeat it. As a good project manager, we have to know what kind of risk that will be happen in our project. Many engineering & construction projects were cost overruns, here are some example of most largest and difficult projects that were over budget.

The list of Projects with Cost Overruns

From above picture, did you what kind of factors that causes the project failure or cost overruns? 40% of project fail due to poor planning and lack of resources. So you have to plan your project. Every Every minute you spend in planning saves 10 minutes in execution; this gives you a 100% return on energy!

So, let’s learn from the past. I would to like to highlight 1 case that we can learn from their experience, thus, we will not repeat it and can save our project.

PANAMA CANAL.

This canal was built to shorten the journey around the tip of South America. It was well-known as one of the largest & most difficult engineering & construction project in history. In 1881, Panama Canal first attempt construction was by French. As the first project manager that appointed by France was Ferdinand de Lesseps. He was famous by his successful previous project – Suez Canal. Based on his experience at Suez Canal, Ferdinand started this project without risk management even blueprints. Although the Panama Canal would eventually have to be only 40% as long as the Suez Canal, it would prove to be far more of an engineering challenge due to the tropical rain forests, climate, the need for canal locks, and the lack of any ancient route to follow.

Malaria, yellow fever, and other tropical diseases conspired against the de Lesseps campaign and after 9 years and a loss of approximately 20,000 lives, the French attempt went bankrupt.

In 1901, Theodore Roosevelt became interested in completing the canal. In 1902, The U.S. purchased the French assets in the canal zone for $40 million. The challenges that were faced by the US, i.e.

• Much of the French equipment was in need of repair, while the spread of yellow fever and malaria was frightening off the workforce.
• Under pressure to keep construction moving forward, Chief Engineer – John Wallace resigned after a year.

1904: The United States took up the, completing the canal a decade later. Some of their strategies, such as:

• Stop excavating all together while an infrastructure was built, so labourers on the project could work faster and more efficiently
• Successfully eradicate Yellow Fever by ridding the project area, worker’s dwellings and eating areas of the deadly mosquito, Stegomyia fasciata
• Fumigating homes and cleansing pools of water

In August 14th, 1914, The US completed at a cost of more than $350 million, it was the most expensive construction project in U.S. history to that point. 56,000 workers employed between 1904 and 1913 from nearly 50 countries, 10 hours a day, six days a week, roughly 5,600 were reported killed.

LESSON LEARNED FROM THIS PROJECT

Digging into a project without a scope and plan will turn your projects into a “Panama” disaster; avoid this by digging in and exploring risks first

Written by:

Alin Veronika, MT, PMP, PMI-RMP

COO of Avenew Indonesia & Chapter President of Project Management Institute (PMI) Indonesia Chapter