How
can companies managing capital-intensive projects, such as factories, nuclear facilities, offshore platforms, rail infrastructure, and data centers, avoid delays and cost overruns? What leads to successful projects?
Significant growth is expected in the number of capital-intensive projects over the next few years. However, many of these projects will face delays, cost overruns, and execution inefficiencies. In today’s climate of economic volatility, labor shortages, and complex regulations, the pressure to complete projects on time and within budget has never been higher. Still, some companies consistently outperform their competitors. What are they doing differently?
This research study explores project management strategies using a survey of 201 professionals working on capital-intensive projects. The study identifies the primary challenges companies face when managing these projects, including the underlying causes of delays and cost overruns. The findings highlight three key strategies that Top Performers use to manage risk, enhance predictability, and achieve better outcomes in today’s most complex and high-stakes projects.
Please enjoy the summary* below. For the full research, please visit our sponsor, Dassault Systèmes (registration required).
Table of Contents
- Executive Summary
- Investment Drivers
- Business Challenges Undermining Success
- Identifying Top Performers
- Strategies for Capital-Intensive Projects
- Improved Collaboration
- Adopt a Digitalization Strategy
- Establish a Single Source of Truth
- A Single Integrated Platform
- Conclusion
- Recommendations
- About the Research
- Acknowledgments
Executive Summary
Capital-Intensive Project Challenges
Capital-intensive projects represent some of the most complex and costly initiatives a business can undertake. As global economic volatility, supply chain disruption, skilled labor shortages, and other uncertainties continue to intensify, organizations must figure out how to deliver these on time, more predictably, and with greater financial control.
The research reveals that while there is a strong need for these capital-intensive projects, their execution continues to be hindered by outdated processes, fragmented tools, and collaboration breakdowns. An overwhelming 75% of respondents report that siloed information and miscommunication have a major or significant negative impact on project success.
Overcoming Challenges
To overcome these challenges, skilled labor shortages, and financial risk, companies are investing in capabilities to improve project predictability, increase on-time completion, strengthen regulatory compliance, and become more agile in response to market shifts.
Best Practices
The research revealed three strategies that Top Performers, the most successful companies, implement to manage capital-intensive projects more effectively:
- Improve collaboration
- Adopt a digitalization strategy
- Establish a single source of truth
As a result of their approaches, their projects are 91% less likely than Others’ projects to face delays and 90% less likely to exceed their project budgets.
To support and enable these strategies, companies prefer a single, integrated platform. In fact, over 80% of respondents preferred a platform approach to manage capital-intensive projects rather than using multiple disconnected best-of-breed tools. An integrated platform helps organizations realize greater project predictability, enabling them to:
- Reduce cost overruns
- Improve on-time completion
- Support regulatory compliance
- Become more agile
As part of the platform, they also leverage advanced capabilities such as artificial intelligence (AI)-driven analytics, which leads to higher productivity and better decisions. By adopting approaches used by Top Performers, companies managing capital-intensive projects can establish a solid foundation for successful project management.
Business Challenges Undermining Success
Overcome Challenges
In addition to meeting business goals, companies also need to address the core challenges that hinder capital-intensive project success. These issues (see graph) should be prioritized when investing in project management.
Skilled Worker Shortage
The shortage of skilled workers is a significant challenge. Companies struggle to fill positions like engineering, construction, and project management, particularly as experienced professionals retire following the COVID pandemic. This talent gap means:
- Slower project execution
- More errors and rework
- Difficulty transferring institutional knowledge
Teams must now do more with less. This underscores the need for tools that boost productivity, streamline collaboration, and capture expertise before it walks out the door.
Regulatory Compliance
Evolving regulations, especially in energy, infrastructure, and life sciences, often cause delays and rework. Teams must monitor changes, document compliance, and respond to audits. Yet fragmented tools and siloed data make this a time-consuming, manual task.
Without accurate, traceable data, it’s difficult to:
- Proactively identify compliance risks
- Respond quickly to changing regulations
- Demonstrate compliance during audits
An integrated solution that consolidates these silos and provides traceability could alleviate this issue. It would also make assessing sustainability impacts easier.
Delays and Cost Overruns
Delays and overruns remain persistent challenges. Unfortunately, delays lead to missed deadlines, which drive up cost and, in many cases, can result in penalties. Design and requirement changes (reported by 50%), poor collaboration (46%), and manual processes (41%) are the top causes of delays. Meanwhile, inflation (49%), supply chain disruption (42%), and outdated data (42%) lead to budget overruns.
In follow-up interviews with participants who reported fewer delays and cost overruns, many admitted that they manage these risks by building in ”schedule buffers” of about six months and lining up backup vendors as a contingency plan. While effective, this is more of a workaround than a solution. Others take a more proactive approach by adopting modern technology that increases visibility and leads to better predictability.
To uncover what truly works, let’s examine what Top Performing companies do.
Establish a Single Source of Truth
Too Many Disconnected Tools
Establishing a single source of truth is the most common strategy among Top Performers for improving capital-intensive project performance. This creates a centralized repository of project data accessible to all stakeholders. While most companies recognize the value of this approach, many struggle to implement it. Respondents report widespread reliance on multiple disconnected tools, creating fragmented data environments that hinder coordination, transparency, and decision making.
On average, respondents use 7.5 standalone tools to manage project data, with 46% relying on more than eight. These include spreadsheets and general tools for managing projects, collaboration, scheduling, supply chains, risk, costing, and more.
While each tool may be well-suited for its task, many disconnected solutions make it extremely difficult to get a consolidated view of project information. Respondents report spending an average of 4.8 hours preparing for a single status meeting, while 33% say it takes six or more hours just to gather needed information.
Another issue is that data stored in multiple locations can easily become outdated or conflicting, eroding trust in its accuracy. Team members then waste time searching for and validating data.
An Integrated Platform
These challenges are driving a strong preference for integrated solutions over many disconnected, best-of-breed tools. An overwhelming 85% realize significant benefits with an integrated platform. By consolidating data and workflows, companies can reduce the risk of errors, rework, and delays while increasing transparency for executives and stakeholders. This leads to improved data accuracy, faster decision making, clear audit trails, and more optimized resource allocation. Together, these advantages translate into measurable business value (see graphic).
Conclusion
Addressing Capital-Intensive Project Complexity
Capital-intensive projects are inherently complex, risky, and high-stakes. However, they also contribute to long-term business growth, improve societal infrastructure, and promote greater sustainability. This should drive many opportunities for these projects in the coming years. From gigafactories and wind farms to airports and life science facilities, these projects play a crucial role in shaping the future.
Despite their importance, many struggle with delays, cost overruns, and collaboration breakdowns, often due to fragmented systems and outdated processes. Companies that successfully overcome these challenges will be well-positioned to execute projects on time and on budget, thereby establishing a strong reputation and gaining a competitive advantage for securing future contracts or increasing profitability.
Top Performing Approach
Our research shows that Top Performers share common strategies. They are actively transforming how they manage projects by adopting collaborative practices, establishing a single source of truth, and supporting digitalization, all enabled by an integrated platform.
Rather than relying on disparate tools, Top Performers are transitioning to unified systems that offer real-time visibility, facilitate better decision making, and enhance productivity across teams, particularly through advanced capabilities such as AI-driven analytics.
*This summary is an abbreviated version of the ebook and does not contain the full content. For the full research, please visit our sponsor, Dassault Systèmes.
If you have difficulty obtaining a copy of the research, please contact us.
