The Megaproject: The Case of NEOM Smart City in Saudi Arabia

Abstract

Saudi Arabia is one of the countries that have put significant efforts towards the development of a megaproject Smart City (SC) by the Saudi vision 2030, which is a modern city that applies smart approaches towards solving daily life challenges. Through the development of the NEOM city, the country aims at reducing its dependency on oil as well as expanding and enhancing all public services, and human life by technology to bring smart economy, smart living, smart governance, smart people, smart environment, and smart mobility. This study is aimed at understanding why megaprojects fail and find ways of managing those failures so that they may not affect Smart City (SC) in the future. Using NEOM megaproject Smart City (SC) as a case study, as well as the study’s objectives, were: (1) to explore the extent to which the megaproject will continue to fail, (2) to investigate the basic factors that led to failures of megaprojects in order to reduce the failure of upcoming projects, and (3) to understand how the principles of megaproject failures may affect smart cities. A sample of 35 stakeholders in the NEOM megaproject Smart City (SC) aged 21 and above are consisting of both male and female participants was purposively selected. Thus, the data that was used for this study was primary data that was collected through online survey questionnaires which addressed all the issues that are related to NEOM megaproject Smart City (SC). The data was evaluated and analyzed through Excel and SPSS. Significant findings revealed that, just like any other megaproject, there are chances that the NEOM megaproject Smart City (SC) would fail due to challenges relating to budget constraints, management of resources, and estimation of costs. This may be caused by poor management and cost overruns. Additionally, the study revealed that stakeholders such as investors, and technology like artificial intelligence (AI), may also be contributors to the failure of the megaproject. Finally, as a means of preventing the failure of the mega project, the study recommended that the project would avoid cost overruns through a proper risk management plan and involving professionals from all fields related to the project. It further recommended the use of project management experts to oversee small units within the project, who would in turn report to other managers at the central system.