Major Projects in a Disrupted World – How should we deal with Radical Uncertainty?

In March 2020, Mervyn King, ex-Governor of the Bank England and John Kay, published Radical Uncertainty – Decision Making for an Unknowable Future in which they argue that many more of the uncertainties facing governments and businesses have the quality of being mysteries and not puzzles. In short, two men who have spent their careers building numerical models (and still defend them as an aid to organising our thinking) urged decision makers not to be seduced by the spurious accuracy they can provide.

Days after King and Kay’s book hit the shelves, we were hit by an example of this phenomena in the form of the Covid-19 lockdown, the single most disruptive event of many of our professional lifetimes.

Pandemic viruses have been at the top of many country’s national risk registers for years and modelling existed on the likelihood of an outbreak in any given year and its impact. What remained unknown was exactly when a pandemic would strike, what form it would take, how governments and the public would react and a host of other factors. This meant that in the autumn of 2019 we knew something about pandemic virus but nothing that led us to take action to avoid the devasting impact of COVID-19   

How should the major projects community respond to the challenge of Radical Uncertainty? Should we really place so much weight on the analyses of factors such as the value of time savings to be created by a transport scheme, projected decades into an uncertain future.

Equally how can we make sure that models do not lead us to miss or ignore threats that fall outside of their assumptions but in some sense, we know are all to real. The response of many project professionals to the issues identified in National Audit Office’s 2019 Completing Crossrail study was yes of course, we always knew that would be a problem.

To unpack the challenge of decision making under conditions of uncertainty, this session will explore:

• The role of narratives in shaping and stabilising an uncertain project environment through the lifecycle
• The relationship between strategic and economic business cases in HM Treasury’s Green Book and similar assessment methodologies and how these and other tools can help projects navigate an uncertain environment
• The relationship and trade-offs between resilience and efficiency and how project professionals are assessing them.