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(PM-1744) Today’s Buzz Words -- Optimism Bias

Primary Author: Mr. J. Michael Devine CCP

Audience Focus: Intermediate
Application Type: Application
Venue: 2014 AACE International Annual Meeting, New Orleans, LA, USA

Abstract: Many recent publications support the belief that most extremely large or mega projects [10] consistently overrun original cost and schedule due to Optimism Bias [9] baked in during the planning stages of the projects.

Optimism bias can doom projects to failure due to omitted or unidentified scope, poor or unrealistic initial cost estimates, ill-conceived schedules, or the lack of proper consideration of risks. Also, some are inclined to believe that the facts regarding a project’s most likely cost and risk are simply hidden in order to get initial approval to launch the project. However, I propose that there is another equally viable reason why mega projects fail to deliver on time and on budget. That reason is poor project management. We see it every day.