Common failures in PPP process management Maarten Groothuis

Common failures in PPP process management 1. General project management issues 2. Lack of support for PPP 3. Decision making based on incomplete information / insufficient knowledge 4. Lack of public-public agreement 5. Silos in the tendering team 6. Legal issues / cases 7. Monitoring / contract management during building phase

General project management issues Time- and cost overruns Time- and cost overruns No contingency plans No contingency plans Scope creep: new objectives are added during the project Scope creep: new objectives are added during the project Irrealistic targets / expectations Irrealistic targets / expectations Etcetera Etcetera

Lack of support for PPP Certain decision making stakeholders have great difficulty with PPP Certain decision making stakeholders have great difficulty with PPP Possible rationales: Possible rationales: –perceived lack of flexibility in PPP contracts –non usage of procurement volume contracts –impact to the own service organization Project team has to cope with resistance to change / to PPP in general Project team has to cope with resistance to change / to PPP in general

Incomplete information / insufficient knowledge with decision makers PPP projects are more complex than traditional tendering PPP projects are more complex than traditional tendering Decision makers may “jump to conclusion”, based on the wrong facts Decision makers may “jump to conclusion”, based on the wrong facts Project team has to be aware of this and has to invest time and effort in decision makers Project team has to be aware of this and has to invest time and effort in decision makers

Lack of public-public agreement Roles and responsibilities differ for different authority levels Roles and responsibilities differ for different authority levels As a consequence, their interests are never 100% convergent As a consequence, their interests are never 100% convergent Lack of public-public agreement in later stages of the project, delay the planning and cause frustrations Lack of public-public agreement in later stages of the project, delay the planning and cause frustrations

Silos in the tendering team Technical, financial and legal teams are separated for project management reasons Technical, financial and legal teams are separated for project management reasons May lead to a poor integral approach, resulting in less value for more money May lead to a poor integral approach, resulting in less value for more money Share the integral vision and cooperate between teams, especially in selection stages of the project Share the integral vision and cooperate between teams, especially in selection stages of the project

Legal issues / cases Tendering is getting more and more surrounded by legislation Tendering is getting more and more surrounded by legislation Legal cases seem to be part of the game Legal cases seem to be part of the game Be clear, precise and follow transparent procedures, to prevent from loss of time and money Be clear, precise and follow transparent procedures, to prevent from loss of time and money

Monitoring / contract management during building phase Cooperation with the private partner already starts when the preferred bidder is announced Cooperation with the private partner already starts when the preferred bidder is announced Monitoring procedures often start only after availability of the service Monitoring procedures often start only after availability of the service Make sure cooperation is already supported by contract management / monitoring straight when the contract is closed Make sure cooperation is already supported by contract management / monitoring straight when the contract is closed

Questions?