Be it home-extensions or renovation, advanced communications, or public interest projects such safer modes of transport, sanitation, and buildings…we know that typically these “infrastructure” projects usually cost more than the original budget. What me might not realise is that it has been estimated that around 10% of project overruns is due to some kind of fraud. Whether it’s our own money, or we are indirectly footing the bill, fraud is a cost nobody needs.
Achieving fraud-free infrastructures through empowerment…
“Infrastructure” is in all our lives. This could be “traditional” infrastructure such as essential facilities and systems which enable our community to function, or the electricity which powers our home or the highways on which we travel. Or it could be the fast-evolving post COVID infrastructure such as the “new” IT systems on which we increasingly rely, the information highways we constantly cruise, virtual environments, and buildings, where we work…and pretty soon holographic infrastructure which powers our meetings
So why does the infrastructure industry have a poor track record when it comes to fraud, estimated to be around 10% of a project’s cost or a company’s revenue? Here are three reasons why projects attract fraud, from B4’s infrastructure expert:
- Infrastructure projects have very long supply chains with many mark-ups.
- Infrastructure projects are complex, involving many disciplines.
- Whether we are leaders, politicians, or just regular members of the public, we tend to love “vanity projects”. But the desire to achieve leaves blind spots and whether it’s home improvements or great leaps forward, fixed price infrastructure projects are uncommon.
Fraudsters today are becoming more desperate and sophisticated but at the same time the infrastructure industry brings out the best in us. The industry embraces the UN sustainable development goals faster than other. Take progress in health, safety, and environment over recent decades for example. It makes sense to empower everyone, including project managers and engineers with the requisite “fraud detective skills” to help reduce and remove a wholly unnecessary cost.
Forthcoming B4 Fraud Community events
Watch this space for upcoming community events including “Tall Mountains – Emperor Far Away” …how to keep good control of those areas of your organisation to which you cannot travel to, plus a special event for community members on latest developments and B4 Precrimee