The Moloch Trap of Capital Project Commissioning

A Moloch Trap is a situation where an individual or group is compelled to make a particular short-term decision to protect their own self interest, despite being aware of the potential impacts of their decision on the bigger picture. This isn’t anyone’s fault, I’ll give you an example of a Moloch Trap.

Let’s pretend you’re a king crab fisherman. King crabs are extremely valuable, so it’s in your best interest to catch and sell as many as you can. But if everyone tried to maximize their catch and profits, there would eventually be no king crabs left to catch, and everyone, including yourself, would no longer be able to profit from catching king crabs.? Maximizing your self-interests would kill the industry. This is why limits are imposed on king crab fishing – to avoid the Moloch Trap.

The same situation applies to capital projects. When contracts are awarded on projects, there are inherently lines drawn between the various groups contributing to the project outcome. This sets the stage for projects to fall into a Moloch Trap right from the beginning if teams aren’t aware of this and actively take steps to avoid it.? Design groups are incentivized in their contracts, construction groups are incentivized in their contracts, and too often misaligned incentives are not setting projects up for successful commissioning and startup for operation of new facilities.

Take contract claims as an example. The threat of claims creates an environment where groups are incentivized to protect their own self-interests and are hesitant to collaborate with each other. Contractors do not want to be impacted to complete their work, nor do they want changes that slow down their progress. Project owners want to get a functional end-product that may require changes to the original design, while also minimizing the costs of the project. These group’s different perspectives create a Moloch Trap, where each group is compelled to protect their own self-interests, rather than work together to solve issues in the best-interest of the project outcome.

There is a win-win approach where all groups working on projects can be wildly successful and accomplish great things together, but it takes dedication to avoid getting sucked into the Moloch Trap.

So how do project avoid this?? The Moloch Trap can be partially avoided with better contracts to align incentives. This sets better rules at the beginning of projects for all groups to follow. But this will only get you so far.

There are two key aspects that differentiate projects that avoid the Moloch Trap, versus those that fall deep into this trap.

The first key to avoid the Moloch Trap is strong leadership. It takes a very dynamic and charismatic leader to inspire all teams to make best-for-project decisions and stay on the path to successful project completion. Bent Flyvbjerg gives a good case study of the Terminal 5 Heathrow airport expansion in his book How Big Things Get Done, where the leadership for the project made it their objective to keep teams aligned on the goal of completion and avoid groups from falling into the Moloch Trap. This multi-billion-dollar project that was completed on-time and on-budget is a good example of strong leadership to ensure teams are collaborating to solve problems together.

However, not all projects have strong leaders, or they have the wrong person making decisions during various phases of projects. Leadership is subjective and we’re all aware of the many soft skills that leaders must have in communication and working well with all types of personalities, if they are to effectively motivate and inspire project teams.? These skillsets can sometimes be challenging to find, so getting the right leaders on projects can be a difficult task. Without a strong leader, projects can easily fall into the Moloch Trap as priorities diverge once projects commences and issues are encountered.

The fallback, in the case where strong leadership is not available, is to have strong completion processes defined early in projects to guide the team on the path to completion. When leadership is not as strong as projects require them to be, detailed processes followed on a daily basis keep teams from deviating away from project objectives and avoid getting sucked into the Moloch Trap.

The worst-case scenario is when leadership is not functioning at the level required, and there are no completion processes defined on projects. Nobody wants to admit when there is an absence of leadership on their projects, or perhaps it is recognized too late in projects that leadership is not functioning at the high levels required for projects to be successful. But when this is the case, and there are also no processes to fall back on, projects fall deep into the Moloch Trap. Everyone has their back against the wall, holding their cards close to their chest, and are not working collaboratively to solve problems and complete projects.

Instead, the best-case scenario is when projects have strong leadership and industry-best completion processes. These are the projects that everyone is inspired to work on and accomplish great things together.

If finding great leadership is difficult, then the one thing you do have control over are the processes you establish on projects to help teams complete great work. Completing capital projects is challenging, and you need every advantage you can get if you want your projects to be successful. Strive for both great leadership and world-class completion processes on your projects. Join our next live webinar to learn more about Commissioning Project Management. Get the Zoom link here. With inspiring leaders and best-in-class completion processes, your project teams have the best chance to avoid the Moloch Trap.