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This chapter characterizes the propensity of big capital investments to systematically deliver poor outcomes as “fragility”—a notion suggested by Nassim Taleb. A thing or system that is easily harmed by randomness is fragile. It is argued that, contrary to their appearance, big capital investments break easily—they deliver negative net present value—due to various sources of uncertainty that impact them during their long gestation, implementation, and operation periods. The existence of economies of scale and scope is not refuted; instead, it is argued that big capital investments have a disproportionate (non-linear) exposure to uncertainties that deliver poor or negative returns above and beyond their economies of scale and scope. It is further argued that to succeed, leaders of capital projects need to carefully consider where scaling pays off and where it does not. To automatically assume that “bigger is better,” which is common in megaproject management, is a recipe for failure.
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