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This paper explores how theories of the planning fallacy and the outside viewmay be used to conduct quality control and due diligence in project management.First, a much-neglected issue in project management is identified, namely thatthe front-end estimates of costs and benefits--used in the business cases,cost-benefit analyses, and social and environmental impact assessments thattypically support decisions on projects--are typically significantly differentfrom actual ex post costs and benefits, and are therefore poor predictors ofthe actual value and viability of projects. Second, it is discussed howKahneman and Tversky's theories of the planning fallacy and the outside viewmay help explain and remedy this situation through quality control ofdecisions. Third, it is described what quality control and due diligence are inthe context of project management, and an eight-step procedure is outlined fordue diligence based on the outside view. Fourth, the procedure is tested on areal-life, multibillion-dollar project, organized as a public-privatepartnership. Finally, Akerlof and Shiller's recent discussion in economics of"firing the forecaster" is discussed together with its relevance to projectmanagement. In sum, the paper demonstrates the need, the theoretical basis, apractical methodology, and a real-life example for how to de-bias projectmanagement using quality control and due diligence based on the outside view.

Quality Control and Due Diligence in Project Management: Getting Decisions Right by Taking the Outside View