Megatrends 2021: Driving Change Through Projects
COVID-19. The climate crisis. Civil, civic and equality movements. Shifting globalization dynamics. Mainstream AI. These five megatrends are fundamentally altering the course of The Project Economy and shouldn’t be ignored.
2020 showed all of us that unexpected, disruptive change is inevitable. We can’t fight it. Instead, we can better seek to understand it and use that knowledge to our advantage.
The world is changing fast. And every day, project professionals are turning ideas into reality—delivering value to their organizations and society as a whole. On Projectified®, we’ll help you stay on top of the trends and see what’s ahead for The Project Economy—and your career.
This is Projectified®. I’m Steve Hendershot.
The five megatrends I listed up top are reshaping our world, disrupting how we live and work. And as you just heard from PMI President and CEO Sunil Prashara, project leaders need to engage—to understand the trends and their implications so that they can drive change and deliver positive social impact at a time when it’s needed most. Today we’re going to crack the lid on a couple of those megatrends, hearing from project leaders whose work demands not just an understanding of the major forces changing the world, but how those megatrends amplify and accelerate one another. You can check out PMI’s full Megatrends 2021 report on PMI.org.
Our sponsor for this episode is PMTraining.com. From live virtual classes to online courses available on demand, PMTraining equips students to earn PMI certifications including the Project Management Professional, or PMP®. And Projectified® listeners are eligible for discounts of up to $400 per class; just enter the link PMTraining.com/podcast.
Let’s start with the shifting dynamics of globalization. We’ve talked before on the show about globalization and the influx of young workers in developing countries. As the report says, emerging markets have rocketed to the global stage, but they need major investments in infrastructure and education to help them move beyond middle-income status. So the work of ensuring that these developing economies are built on a solid foundation that will continue to facilitate growth, well, it’s crucial.
Farhad Abdollahyan moved from Brazil to Niamey, Niger in 2018 to run the project management office for the United Nations Office for Project Services. He’s overseeing two projects totaling 440 million U.S. dollars, both aimed at bolstering the economy of Niger, home to 23 million people.
These projects are focused on the fundamentals for a growing economy—building blocks such as an irrigation infrastructure that will help farmers become more efficient and resilient, and building reliable roads. This is stuff you just have to have if you’re going to attract investment or facilitate the kind of economic development to increase the standard of living.
To benefit from globalization, emerging economies like that of Niger need investments in things like infrastructure so they can compete. How’s the country faring on that front?
Niger is a rural country. The services are, of course, now starting to develop. And especially with the internet coming to the villages, that will boost some of the activities that were supposed to be done in a further stage of development. Nowadays, you don’t go from one stage to the other; you hop. Thanks to internet, now we have some services, especially financial services. We have e-commerce developing fast in Niger. People have mobiles, but they don’t have the appliances that exist in the first-world countries. The internet is opening some windows of opportunity here.
So where do you see some of the biggest infrastructure challenges?
The problem here is that Niger doesn’t have any ports. They have only land, frontiers and airports. Having infrastructure to move around goods and services and people is essential. That’s why one of the projects that we are helping their government is to refurbish two major roads that they have. One of them goes to Benin, which is one of the neighbors, and the neighbor Benin has a port, so it’s very important to be able to access those transport possibilities. So infrastructure is still a challenge here. The roads are not good for transport because they have a lot of holes, and it’s not well maintained. So one of the things that we did here was to reform the maintenance policy of the country as well. It’s very important to have the infrastructure, but of course, you have to have also the new technologies coming. And these are the things that has to be done in parallel.
There is no transformation industry here; this is one of the potentials. Instead of exporting raw agricultural goods, produce, you can process them before you send it over. We are also helping them to come up with some factories for dairy products. If you get those factories in, you can have a cluster of agribusiness because of the nature of this country, which is very agricultural. If you put the technology which goes together, let’s say, for example, drones for mapping the farms, to see where to put the fertilizers and things like that, that will boost productivity and they can have growth, which was not possible if you do it with traditional means that they do it.
You have to do several things at the same time, which all of them goes to the same objective. You have to have a logical framework. The logical framework here is that there are some obstacles that hinders the growth. And if you play all these buttons at the same time, you will accelerate the growth. So modernizing is one of the most important things that has to be done.
It’s interesting to think about this from a project leadership standpoint because in one sense, your outcome or deliverable is to build a road, but in a deeper sense, what you’re trying to do is build a road so that you will facilitate investments and make it an easier decision for some business to come in or one to start. As a project leader, how do you make sure that the scope of what you’re doing includes that component
This program has a component called monitoring and evaluation. We are spending $12 million only on that. So we have indicators not only for the outputs but also for the outcomes and for the impact to make sure that whatever solution we are putting in place doesn’t become a white elephant. Because it has to be used to come up with the outcomes. The outcomes have to be measured by the benefits, and these benefits has to increase the economic rate of return of this investment. So, everything is very rational, very objective, and we monitor and we make sure that the right project with the right cost is put in place and make sure that the markets are also ready to get those products.
One of the activities that we have here is private-sector integration with the program so that they can turn this program sustainable in the future. I will give you an example. We are putting some small-scale irrigation in one of the sites, and we will have solar energy pumps and motors. The younger generation can learn how to do the maintenance and create their own business of maintaining those solar panels. So you see that there is a synergy with what is put as infrastructure and what comes afterward as maintenance and improvements and in the future it becomes permanent; it becomes sustainable. The sustainability is very important for this project. Also, social inclusion and gender, especially women, are incentivized to have their parcels of land. And of course, with the technology, we have to do a lot of technology transfer and trainings. These activities are all important to make sure that the long-term objective is attained.
This program has five years of duration and three more years of monitoring and evaluation, which means that the results will be checked after the outputs are put in place to make sure that everything which was supposed to be creating economic growth is in place. When we make decisions on the project, we have to make sure that they’re not going to reduce the benefits of the project. The economic rate of return of this project is as important as the schedule and the output cost. So, the decisions are made based on the value creation.
What role do partnerships play in these infrastructure projects? Obviously you’re ultimately hoping that as the country develops, some of those partners find the region worthy of investment beyond the philanthropic.
When you inject $440 million in an economy such as Niger, if you do it the right way, you will create a synergy with the local tissue of the economy. In the future, it becomes auto replicating because you have to maintain whatever you did. So it’s not just the infrastructure to be delivered, but also to maintain it in the future to be working. So, for the roads, you will have small contractors that will be engaged by the local government to do the maintenance. By building a road, you will build also correlated activities, possibilities for the private sector to come in and put their energy together. That’s the partnership. You show them what are the synergies are, what are the complementarity of the services and goods are, and they come.
One of the things that we are doing here is grants, which means that the other side has to put their money as well. So in a way we increase the possibility to access to capital and with that, they start their businesses and their businesses, it has to be linked to resilient agriculture. So in a way, you’re incentivizing also innovation. You see that the grant is $1 million, but the other side has to put $500,000 or $800,000 to complement it. The private-public partnership is one of the things that can create the tissue rapidly. Because one of the things is happening here is that they don’t have access to capital. So if they have access to capital or partners that they want to come and work together, I think that will be a success.
These megatrends aren’t happening in a bubble, and our next guest is working at the locus of three of them: climate change, AI and COVID-19.
Projectified®’s Hannah Schmidt spoke with Rob Wilhite, senior vice president and director of global distributed energy at construction and engineering firm Black & Veatch in Charlotte, North Carolina in the U.S. He shared the ways that the firm’s projects crisscross several different megatrends.
COVID-19 has impacted projects in industries and regions around the world. How’re you seeing it affect investments in projects to battle climate change within the energy sector?
Yeah, it’s interesting. If you look at the power utilities sector, a lot of utilities were still trying to figure out when is the appropriate timing for retiring coal-based power generation assets? Should we invest in the ability to clean up the environmental footprint of those power plants and still operate them for a while? And in some cases, those decisions were still being pushed out many years into the future. So for one thing, it certainly seems to have accelerated those kind of decisions over the last 12 to 18 months.
In fact, we’re seeing a diversion of capital spending from certain types of projects into new projects. I mean, we’ve seen a couple of examples here in the Southeast part of the U.S. where I live, where large-scale natural gas transmission pipeline projects have been completely shut down and that capital spending will now be redirected towards large-scale solar, large-scale battery storage systems and other forms of clean energy investments. That is something that would normally in most environments in the utility industry take many years to actually go through that kind of pivot. I think with COVID, it’s really accelerated very rapidly the need for utilities to make that decision much quicker and more rapidly than they had to in the past. And so you’ve seen a lot of decisions coming out in the industry that probably were accelerated that would have been strung out over the next four or five years, at least.
I also want to talk about AI. What role is it playing in infrastructure and engineering projects, and how is AI being used to help mitigate climate change?
Yeah, I love this topic. One of the things that we are looking to better understand and use more often are robotic-controlled earth-digging equipment, be it dozers or other type of earth-moving equipment. We’ve been partnering with companies that have the ability to operate that equipment without anyone on board, operating it remotely. But also using AI to judge the work area, safety measures, to be able to immediately halt that equipment or stop it in midflight if humans or other animals breach a scanned area around that equipment. And so we’re finding that this improves not only the productivity associated with earth-moving type of equipment like that, but it also improves the safety of the humans and our professionals and our craft workers involved with those types of systems.
Another example of that, Hannah, is thinking about the projects where we are putting rooftop solar on commercial buildings for customers. For example, large banks that operate multiple facilities all across the U.S. And not only putting in the infrastructure, but how do we monitor that infrastructure using remote communications capability, but also applying AI in terms of data analytics to not only predict how performance will occur as a result of the clean energy, on-site energy production, but how do we actually leverage that data to be able to understand how do we dispatch individuals for maintenance purposes to the right facilities at the right time? How do we make sure we understand using AI to be able to build those facilities, better understand lead times we need for permitting requirements, meeting local building codes? I think that the use of AI is just barely scratching the surface in the power utility industry.
How can tech like digital twins—or digital replicas of physical objects—help organizations execute projects in a more sustainable way? Are there organizations you think stand out in how they’re approaching the issue?
I’m very impressed by some utilities—I’ll just name New York Power Authority. They’ve gone on record saying they want to be one of the first utilities in the United States to be a hundred percent digital. They’re creating digital twins of all of their power generation, transmission, and other assets that they own and operate in order to simply model all the various scenarios associated with more intense and more frequent storm events. Perhaps cyber events, physical damages, whatever scenarios they conjure up can certainly be simulated through the use of digital twins to better understand how do they respond? Where do they need to make investments in resiliency? And what does that look like in terms of a large statewide utility service area? Those are very important tools to help them better prioritize their capital investments as well as their operation and maintenance budgets moving forward.
We’re also seeing very similar interests in places like in Florida, for instance, where legislation was passed to be able to enable the utilities there to invest in resiliency. And in many cases, they might be putting underground some of the existing overhead power lines that have been subject to damage for many years due to hurricanes and other tropical storm activity that’s very prevalent down there. And so, using digital twins to help understand the economics of specific lines, the ability to recover more quickly from bigger storm events, that enables utilities to make much better, informed decisions around how they spend capital, but how they justify it to their regulatory authorities in order to make sure that they’ve got a solid business case for cost recovery purposes.
What projects are you hoping to see to mitigate the effects of climate change in the next 10 years?
One thing that excites many of our professionals is anything associated with transportation. We’re seeing greater consumer adoption of electric vehicles, both for personal passenger vehicles, but also as I mentioned earlier for commercial fleets. We’d like to see that extended to other types of vehicles, delivery vehicles.
We are, as a company, better understanding the use of drone technology, especially for power utilities who can use that technology to inspect high-voltage, high-tension power lines that otherwise would be very difficult or are very complex to be able to get a human being to be able to inspect some of those facilities in very remote areas. Those kinds of technologies, I think, are going to not only change the notion of how utilities can get smarter in spending their crucial O and M [operations and maintenance] dollars, but also increase reliability and resiliency for our power system overall.
The use of AI is something that will continue to grow. We’re very excited about that type of technology. I mentioned the example of commercial rooftop solar in monitoring those sites on a real-time basis to be able to understand the power output, but also how does that information then become available to verify renewable energy credits that can be tabulated in a third-party ledger, perhaps even using blockchain technology? So these are the kinds of things that we’re currently looking at and better understanding, how do they fit into the infrastructure projects that we do for our clients all around the world.
2020 tested even the most exceptional organizations and project leaders. But amidst the chaos, a new ecosystem of changemakers emerged. For them, the megatrends were an opportunity not only to deliver value, but maybe even to make the world a better place.
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