We interviewed our Principal Project Management Consultant, Julien Bourrand, to find out how he believes Op2’s approach to Public Private Partnerships (PPPs) and Complex Projects is unique. Read on to learn more about PPPs and our approach.
What is a public private partnership?
“A public private partnership (PPP) is an arrangement between public and private sectors of a long-term nature. Typically, it involves private capital financing government projects and services up-front, and then drawing profits from taxpayers and/or users over the course of the PPP contract.”
How does a PPP differ from other project contracts?
“Due to its complex contract structure and its nature, a PPP will involve a higher number of parties than standard projects. The nature of the stakeholders will also often be more diverse than other complex setups such as Alliances, as they will involve potential pure financial stakeholders (equity partners, investment funds, banks…) as well as more operational players such as contractors, or more politically involved structures (government agencies). Independent Certifiers are also often involved in order to avoid or alleviate conflicts between the parties through independent determination.”
What are some of the key challenges met in a PPP?
“Due to the number of stakeholders having diverse (and often conflicting) cultures and agendas, the management of communication and technical interfaces is particularly delicate. The heavy Contract structure will also bring challenges around the contract administration, notably the planning and claim management from an operational and commercial standpoint. Due to the nature of the model (bringing private funding), PPP Projects are almost systematically major projects in terms of size and complexity as well, which often leads to high risk profile for the contractor, notably against delays, as the timeline will drive most of the structured finance models used by the lenders.”
How does Op2 manage the challenges in a PPP?
“As most key challenges revolve around efficient decision-making and strong communication in a complex environment, Op2 tackles PPP through a three-fold approach:
- Make it Simple: break down the project to a readable level (e.g. using tailor-made Dashboards, KPIs, and high-level top-down approaches)
- Make it Visible: bring transparency and circulation of controlled information within the project team (e.g. a Visual Management Room as well as a culture for consistent and up to date communication to all relevant stakeholders)
- Make it Happen: enable efficient and fast paced decision-making (e.g. setup a Governance cycle to promote meeting efficiency; ensure business cases are accurately and timely put together to support the decision-making)”
What other techniques does OP2 use to support PPP projects?
“Additionally, Op2 also focuses on maintaining its customer rights under the contract through rigorous schedule administration (incl. claim management and substantiation) while maintaining the focus on the operational execution. The right balance between contractual/commercial administration and operational execution is key to achieve the best project and financial performance. A deep knowledge of best practices in scheduling but also in forensic planning and in claim substantiation is paramount to that balance.”
For more information, contact us at [email protected].