Industrial Design

This article presents results from the first statistically significant study of cost escalation in transportation infrastructure projects. Based on a sample of 258 transportation infrastructure projects worth US$90 billion and representing different project types, geographical regions, and historical periods, it is found with overwhelming statistical significance that the cost estimates used to decide whether such projects should be built are highly and systematically misleading. Underestimation cannot be explained by error and is best explained by strategic misrepresentation, that is, lying. The policy implications are clear: legislators, administrators, investors, media representatives, and members of the public who value honest numbers should not trust cost estimates and cost-benefit analyses produced by project promoters and their analysts.

The formal methods community is in general very good at undertaking research into the mathematical aspects of formal methods, but not so good at promulgating the use of formal methods in an engineering environment and at an industrial scale. Technology transfer is an extremely important part of the overall effort necessary in the acceptance of formal techniques. This paper explores some of the more informal aspects of applying formal methods and presents some maxims with associated discussion that may help in the application of formal methods in an industrial setting.

This article presents results from the first statistically significant study of traffic forecasts in transportation infrastructure projects. The sample used is the largest of its kind, covering 210 projects in 14 nations worth U.S.$59 billion. The study shows with very high statistical significance that forecasters generally do a poor job of estimating the demand for transportation infrastructure projects. For 9 out of 10 rail projects, passenger forecasts are overestimated; the average overestimation is 106%. For half of all road projects, the difference between actual and forecasted traffic is more than ±20%. The result is substantial financial risks, which are typically ignored or downplayed by planners and decision makers to the detriment of social and economic welfare. Our data also show that forecasts have not become more accurate over the 30-year period studied, despite claims to the contrary by forecasters. The causes of inaccuracy in forecasts are different for rail and road projects, with political causes playing a larger role for rail than for road. The cure is transparency, accountability, and new forecasting methods. The challenge is to change the governance structures for forecasting and project development. Our article shows how planners may help achieve this.

The article first describes characteristics of major infrastructure projects. Second, it documents a much neglected topic in economics: that ex ante estimates of costs and benefits are often very different from actual ex post costs and benefits. For large infrastructure projects the consequences are cost overruns, benefit shortfalls, and the systematic underestimation of risks. Third, implications for cost–benefit analysis are described, including that such analysis is not to be trusted for major infrastructure projects. Fourth, the article uncovers the causes of this state of affairs in terms of perverse incentives that encourage promoters to underestimate costs and overestimate benefits in the business cases for their projects. But the projects that are made to look best on paper are the projects that amass the highest cost overruns and benefit shortfalls in reality. The article depicts this situation as ‘survival of the unfittest’. Fifth, the article sets out to explain how the problem may be solved, with a view to arriving at more efficient and more democratic projects, and avoiding the scandals that often accompany major infrastructure investments. Finally, the article identifies current trends in major infrastructure development. It is argued that a rapid increase in stimulus spending, combined with more investments in emerging economies, combined with more spending on information technology is catapulting infrastructure investment from the frying pan into the fire.

PRODUCT INNOVATION MANAGEMENT ELSEVIER The Journal of Product Innovation Management 18 (2001) 28-38 How integrating industrial design in the product development process impacts on company performance Gerda Gemser3'*, Mark AAM Leendersb "University of ...

This paper focuses on problems and their causes and cures in policy and planning for large-infrastructure projects. First, it identifies as the main problem in major infrastructure developments pervasive misinformation about the costs, benefits, and risks involved. A consequence of misinformation is cost overruns, benefit shortfalls, and waste. Second, it explores the causes of misinformation and finds that political-economic explanations best account for the available evidence: planners and promoters deliberately misrepresent costs, benefits, and risks in order to increase the likelihood that it is their projects, and not those of their competition, that gain approval and funding. This results in the ‘survival of the unfittest’, in which often it is not the best projects that are built, but the most misrepresented ones. Finally, it presents measures for reforming policy and planning for large-infrastructure projects with a focus on better planning methods and changed governance structures, the latter being more important.

A major source of risk in project management is inaccurate forecasts of project costs, demand, and other impacts. The paper presents a promising new approach to mitigating such risk, based on theories of decision making under uncertainty which won the 2002 Nobel prize in economics. First, the paper documents inaccuracy and risk in project management. Second, it explains inaccuracy in terms of optimism bias and strategic misrepresentation. Third, the theoretical basis is presented for a promising new method called "reference class forecasting," which achieves accuracy by basing forecasts on actual performance in a reference class of comparable projects and thereby bypassing both optimism bias and strategic misrepresentation. Fourth, the paper presents the first instance of practical reference class forecasting, which concerns cost forecasts for large transportation infrastructure projects. Finally, potentials for and barriers to reference class forecasting are assessed.

"Over budget, over time, over and over again" appears to be an appropriate slogan for large, complex infrastructure projects. This article explains why cost, benefits, and time forecasts for such projects are systematically over-optimistic in the planning phase. The underlying reasons for forecasting errors are grouped into three categories: delusions or honest mistakes; deceptions or strategic manipulation of information or processes; or bad luck. Delusion and deception have each been addressed in the management literature before, but here they are jointly considered for the first time. They are specifically applied to infrastructure problems in a manner that allows both academics and practitioners to understand and implement the suggested corrective procedures. The article provides a framework for analyzing the relative explanatory power of delusion and deception. It also suggests a simplified framework for analyzing the complex principal-agent relationships that are involved in the approval and construction of large infrastructure projects, which can be used to improve forecasts. Finally, the article illustrates reference class forecasting, an outside view de-biasing technique that has proven successful in overcoming both delusion and deception in private and public investment decisions.

Humanity has come to depend on synthetic, factory made gases that have extremely significant global warming potential. Fluorinated greenhouse gases, or F-gases, such as hydrofluorocarbons (HFCs), perfluorocarbons (PFCs), sulfur hexafluoride (SF6), and nitrogen trifluoride (NF3) have been termed “super pollutants” and “super
greenhouse gases” given their severe and powerful impact on the climate. They are the most potent greenhouse gases known to modern science, with global warming potentials far greater than carbon dioxide, some up to almost 24,000 times more so. Troublingly, they are also the fastest growing class of greenhouse gas emissions around the world, especially in developing countries. Research suggest that almost 40% of their emissions by 2050 will fall outside the scope of international agreements such as the Paris Accord, Montreal Protocol and
Kigali Amendment. Without comprehensive and sustained interventions, uncontrolled growth in F-gas emissions could offset all of the gains made by the Clean Development Mechanism of the Kyoto Protocol, or the cornerstone of existing international climate governance, the Nationally Determined Contributions of the 2015 Paris Accord.
This review asks: What options are available to mitigate the environmental impacts of F-gases and thus make their manufacturing or disposal far more sustainable? What technical solutions and innovations exist to make their industrial usage low to zero carbon? What benefits will accrue from F-gas mitigation, and what barriers will need addressed? It undertakes a comprehensive and critical review of more than 140,000 sources of evidence, and a short list of 855 studies on the topic. It utilizes a sociotechnical lens that examines the manufacturing and use of F-gases across multiple sectors (including refrigeration, electronics manufacturing, non-ferrous metals processing, and applications in consumer goods) and components of its lifecycle (including not only manufacturing, but also use, disposal and destruction). We find that there are several policies and regulations
that can be employed to address this already serious and growing climate change challenge.

We present an efficient Hough transform for automatic detection of cylinders in point clouds. As cylinders are one of the most frequently used primitives for industrial design, automatic and robust methods for their detection and fitting are essential for reverse engineering from point clouds. The current methods employ automatic segmentation followed by geometric fitting, which requires a lot of manual interaction during modelling. Although Hough transform can be used for automatic detection of cylinders, the required 5D Hough space has a prohibitively high time and space complexity for most practical applications. We address this problem in this paper and present a sequential Hough transform for automatic detection of cylinders in point clouds. Our algorithm consists of two sequential steps of low dimensional Hough trans- forms. The first step, called Orientation Estimation, uses the Gaussian sphere of the input data and performs a 2D Hough Transform for finding strong hypotheses ...

The Supplementary Green Book Guidance on Optimism Bias (HM Treasury 2003) with reference to the Review of Large Public Procurement in the UK (Mott MacDonald 2002) notes that there is a demonstrated, systematic, tendency for project appraisers to be overly optimistic and that to redress this tendency appraisers should make explicit, empirically based adjustments to the estimates of a project’s costs, benefits, and duration. HM Treasury recommends that these adjustments be based on data from past projects or similar projects elsewhere, and adjusted for the unique characteristics of the project in hand. In the absence of a more specific evidence base, HM Treasury has encouraged departments to collect data to inform future estimates of optimism, and in the meantime use the best available data. In response to this, the Department for Transport (henceforth DfT), has contracted Bent Flyvbjerg in association with COWI to undertake the consultancy assignment "Procedures for dealing with Optimism Bias in Transport Planning". The present Guidance Document is the result of this assignment.

While society changes its focus from “well-fare” to “well-being,” design becomes increasingly interested in the question whether it can design for happiness. In the present paper, we outline Experience Design, an approach which places pleasurable and meaningful moments at the center of all design efforts. We discuss reasons for focusing on experiences, and provide conceptual tools to help designers, such as a model of an artifact as explicitly consisting of both the material and the experiential. We suggest psychological needs as a way to understand and categorize experiences, and “experience patterns” as a tool to distill the “essence” of an experience for inscribing it into artifacts. Finally, we briefly reflect upon the morality implied by such experiential artifacts.

A survey done by J. M. Juran[1] showed that the Japanese yields of LSI chips are higher than those of the American and European manufacturers by a factor of two to three. Another study made by K. B. Clark[2] showed that the design and development cycle for a specific product was about 30 months for one American electronics company while it was only about 18 months for the Japanese manufacturer of the same product. Clark defines the development cycle as the time taken from the beginning of the product design until the high volume production starts. He observed that the design transfer from development organization to the manufacturing organization was smooth for the Japanese company while for the American company it took several iterations.

Participative processes and citizens’ empowerment are considered crucial aspects of social innovation (SI), involving collaborative activities between the private, public, and third sectors. This article discusses the principal trends in the literature on the concept of SI, its aims and differential characteristics related to the identification of people's needs, citizen participation processes, and improved quality of life. We present an exploratory case study of SI focusing on the gap between elderly people's needs and the generation of business opportunities, using a living lab (LL) methodology for collaborative placed-based innovation. Our results suggest that LLs are a useful instrument to detect community needs and improve local development and support and integrate technological and social innovations in policies and local governance processes.

Risk, including economic risk, is increasingly a concern for public policy and management. The possibility of dealing effectively with risk is hampered, however, by lack of a sound empirical basis for risk assessment and management. This article demonstrates the general point for cost and demand risks in urban rail projects. The article presents empirical evidence that allow valid economic risk assessment and management of urban rail projects, including benchmarking of individual or groups of projects. Benchmarking of the Copenhagen Metro is presented as a case in point. The approach developed is proposed as a model for other types of policies and projects in order to improve economic and financial risk assessment and management in policy and planning.

This paper explores how theories of the planning fallacy and the outside view may be used to conduct quality control and due diligence in project management. First, a much-neglected issue in project management is identified, namely that the front-end estimates of costs and benefits – used in the business cases, cost-benefit analyses, and social and environmental impact assessments that typically support decisions on projects – are typically significantly different from actual ex post costs and benefits, and are therefore poor predictors of the actual value and viability of projects. Second, it is discussed how Kahneman and Tversky’s theories of the planning fallacy and the outside view may help explain and remedy this situation through quality control of decisions. Third, it is described what quality control and due diligence are in the context of project management, and an eight-step procedure is outlined for due diligence based on the outside view. Fourth, the procedure is tested on a real-life, multibillion-dollar project, organized as a public-private partnership. Finally, Akerlof and Shiller’s recent discussion in economics of “firing the forecaster” is discussed together with its relevance to project management. In sum, the paper demonstrates the need, the theoretical basis, a practical methodology, and a real-life example for how to de-bias project management using quality control and due diligence based on the outside view.