Oracle reports that almost US$ 750 billion in airport construction projects are underway or planned. The article below (August 2019), and its associated white paper, canvass best practice for airport planning and construction. We should be in no doubt, however, that the odds are that airport projects will not be delivered on time and on budget.
There are some truly impressive examples of current disasters. Berlin’s new airport continues to surprise even the most pessimistic observers. In May 2019 its forecast cost was US$8.0b (up from US$3.0b) and the opening date is now forecast to be 2020 (blowing out from 2007). Berlin is not alone. The European Court of Auditors (ECA) examined 20 EU funded airports in 2014. It found that 14 experienced significant time overruns, and that significant cost overruns were experienced in nearly half of those examined. To make matters worse, the ECA report found “Only half of the audited airports succeeded in increasing their passenger numbers and improvements in customer service were either not measured or not evidenced”.
In the context of all major projects, the University of Oxford’s database of over 11,000 projects has found that projects that meet all their objectives are rare as black swan’s teeth.
Oxford researchers and consultants Oxford Global Projects , conclude that if we keep doing what we have always done, we will keep getting what we have always got. Perhaps its time to do something different.
So, considering the large airport capital spend emerging worldwide, what can we do to minimise the risk of cost and time overruns. The Oracle Airport best practice white paper gives us five best practice focus areas. Interestingly, these five could have been the same ones mentioned five or more years ago. A key problem identified in the paper is the “low adoption of technology” issue. Ironically this issue is verified by the complete absence of any mention of a role for AI technology in the planning or delivery phases of airports. If the white paper reflections accurately represent best practice, then it’s not good enough.
However, a new best practice is emerging. Artificial Intelligence technology is now available to really leverage technology at a new level. (It is surprising that this is not mentioned in the white paper, with the only mention of AI technology linked to minimising passenger queues). The Octant AI platform and the Fluor/IBM Watson system are cases in point. These systems are examples of the vanguard of AI powered project performance management that will define the new best practice.
Typical Octant AI machine learning-powered dashboard
These systems, though still in early adopter stage, show that best practice must be more than simply more data with more analytics, bigger project teams and more all the things we have been doing for decades. Of course, we should continue to strive in traditional best practice fields, but the overwhelming evidence is that this will not make a fundamental improvement.
Airports are a good candidate for machine learning integration into the project delivery cycle. They are typically large, complex and long lifecycle projects, they are a genuinely global phenomenon and there is a lot of previous data (though its accessibility is a challenge). There is a large forward spend and airport owners/operators are relatively technology savvy. Taking the most conservative (some would say unrealistically optimistic) statistical evidence we can expect cost overruns in excess of 20% for over half of the projects. Using Oracle’s figures this looks like a cost overrun of US$150 billion, not to mention the wider economic impact of late delivery. It seems worth it to me to explore the opportunity for achieving AI benefits in airport delivery.
Endeavour Programme Holdings Pty Ltd
Endeavour Programme’s artificial intelligence platform mitigates time and cost overruns on projects. Our world-first technology Octant AI, predicts problems on major projects faster, earlier and over 200% more accurately, allowing users to make better decisions earlier. We harness the power of project data to improve performance in a $10 trillion global industry. We are the vanguard of a paradigm change.