We are experiencing a once in a generation opportunity to achieve transformative outcomes at scale from the current global, short term infrastructure stimulus spend, and project professionals are on the front line. Aaron Hudson MAIPM CPPE looks at how the new wave of infrastructure projects targets transformative outcomes for people and the planet, and why success depends on tenacious project leadership.

 

The global infrastructure spend

Governments worldwide have turned to infrastructure spending to drive economic recovery post-COVID-19. The stimulus packages represent a once-in-a-generation opportunity to achieve significant transformative outcomes with a global impact through the high-calibre delivery of mega-projects and programs

  • US$3.2 trillion: Infrastructure stimulus announced by G20 governments between March 2020 and August 2021 (source: Beyond the Baseline, Jacobs). This includes US$26.3 billion announced in Australia with by far the largest chunk – some 65% – going to the transport sector (source: Global Infrastructure Outlook)
  • US$94 trillion: Further investment needed over the next 20 years to meet the forecasted infrastructure deficit (source: Global Infrastructure Outlook)

As project leaders, we’re the custodians of best practice, responsible for delivering the benefits of this once-in-a-generation investment. We need to take charge with a sense of urgency and strong leadership to realise these transformative outcomes.

 

Expectations are changing

In the past, project delivery focused on minimising infrastructure development’s impacts, for instance, minimising diversity loss or social dislocation. Now, the expectation is that we derive multiple positive effects throughout project delivery and leave an enduring legacy. The positive social and environmental outcomes are equally important as the economic benefits.

infrastructure-evolution

Blended infrastructure in action

Brisbane 2032 Olympic and Paralympic Games

Hosting Brisbane 2032 presents an opportunity for Queensland to create legacy outcomes over the next 20 years – 10 years before and 10 years after the Games. Their plan will drive economic, social, cultural, environmental, and built environment opportunities that ensure lasting benefits before, during and after the Games.

Source: Brisbane 2032 Olympic and Paralympic Games Legacy Plan

 

The outcomes required through infrastructure are expanding

In November 2021, the Global Infrastructure Hub publicly launched the Transformative Outcomes Through Infrastructure initiative. The initiative examined the stimulus spending announcements of G20 countries at the height of the pandemic and the outcomes those investments were targeting. The GI Hub found that G20 governments are targeting six transformative outcome categories through infrastructure stimulus. These categories are broadly aligned with the United Nations Sustainable Development Goals (UN SDGs).

transformative-outcomes

The GI Hub’s examination found the bulk of infrastructure stimulus already seeks to deliver against at least two of the above transformative outcome categories per investment.

However, for infrastructure to realise its full potential and transformative obligations, infrastructure programs and projects must embrace as many, if not all, of these transformative outcomes at every investment opportunity.
 

Why the urgency?

While the forecasted investment speaks to a 20-year horizon, there are reasons to believe it may be a limited-time offer. This could translate to a limited window to realise transformative outcomes at the pace and scale currently possible

As the global COVID-19 pandemic took hold, governments around the world rapidly committed to stimulus initiatives designed to not only drive economic recovery post COVID-19 but also to make the world more sustainable, resilient, prosperous, and inclusive. The Global Infrastructure Hub estimates this stimulus could represent a 45% increase in the average yearly infrastructure investment across the G20 if spent between 2021 and 2023.

However, we are seeing initial drivers for this spend being progressively overtaken by more recent, and in some part of the world just as calamitous, events. Global resource capacities are becoming stretched and medium term inflationary and supply chain pressures are significantly impacting project budgets. The desire and political will to spend at the current pace and scale may be eroded just as quickly, as delivery costs mount and returns on investments deteriorate. This increases the need to urgently define and value the return from transformative outcomes as part of infrastructure investment.

The growing global talent shortage further compounds the capacity to achieve transformative outcomes within the available funding period.

We have other reasons to adopt a sense of urgency, the most important being the pressing need to realise the transformative outcomes themselves.

Cyber security Wellbeing Environment
Cyber security must be considered as a transformative outcome of program delivery. Secure environments can be achieved by addressing physical, information, and operational technology security profiles in an integrated manner. Projects are expected to improve individual and community wellbeing. Wellbeing determinants include education, skills, employment, health, housing, income, and quality of and access to the natural environment. There is an urgent need to avoid global warming beyond 1.5⁰C (compared to the pre industrial period) and actively reduce carbon emissions. Every infrastructure project must strive to meet or exceed net-zero targets.

 

The opportunity is a challenge for leadership

“We won’t have a successful project unless a focus on the future impact is at the heart of all our decisions”

Nick Smallwood
CEO of UK’s Infrastructure & Project Authority

Source: Delivering sustainable infrastructure: Insights from industry leaders, McKinsey, September 2021

Realising transformative outcomes at every investment opportunity is not easy. Our industry has a strong bias towards rewarding cost-efficient delivery over increased benefits. Governments are routinely challenged for overspending on projects, with little question of whether the return on investment compensated for the increased spend, or whether they had met their carbon budget. Commercial project delivery organisations are geared to maximise profits to shareholders, not to maximise benefits on the projects they deliver.

These challenges must be addressed through strong leadership at government, stakeholder, owner, and delivery team levels. We need visionary political, infrastructure, project and community leadership that takes responsibility for achieving transformative outcomes, and steers teams effectively both during and after delivery to create positive, lasting legacies.

 

How can we do this?

A tricky question, best answered by starting with two much simpler questions:

  1. What leadership attributes do current and emerging infrastructure leaders need to lead the charge on realising transformative outcomes through infrastructure.
  2. How can leaders acquire these attributes?

 

Our team at Jacobs explored each of these questions in detail in our recent paper, Beyond the Baseline Part 1: Leading infrastructure teams to deliver transformative outcomes. We outlined several key attributes and abilities that we believe collective infrastructure leadership must possess to instil the culture and behaviours needed to embrace and adopt strategies that will realise transformative outcomes.

We also outlined a few strategies that can be implemented at a jurisdictional/ organisational level and at a program/ project level to help develop these attributes in our people. Committing to developing adaptable and resilient leaders by providing ongoing professional training and development for people is key.

 

Key attributes and abilities that collective infrastructure leadership must possess

  • Fully appreciate the complicated and dynamic nature of the strategic operating environment
  • Have clear values and communicate these value
  • Be able to mobilise private capital and partner with an array of potential investors
  • Be exceptional at building and leading diverse teams
  • Have the experience needed to deliver complex projects
  • Have an entrepreneurial spirit
  • Be politically astute and able to collaborate across government(s)
  • Be excellent communicators
  • Implement agile organisational structures with clear plans for resourcing both now and in the future
  • Be data and analytics driven
  • Be comfortable with disruption and change
  • Commit to a learning-based approach
  • Create an environment that values and facilitates cooperative relationships with partners

 

Let’s seize the day

It’s exciting to be at the forefront of this once in a generation opportunity to achieve transformative outcomes at scale. There is so much opportunity within our grasp, but it will take deliberate effort and strong leadership, acting with urgency to realise it. We believe the AIPM, and all of us as members, have a significant role to play. As the peak industry body in project management, and as industry professionals, it is incumbent upon us to guide our governments, stakeholders, owners, and delivery teams to take advantage of this once-in-a-generation opportunity.