Upon entering a public-private partnership, there are several factors that allow both entities at the beginning of the partnership to increase their chances of project success. The most successful public-private partnerships have incorporated essential strategies and tools throughout the phases of planning, building, execution and maintenance to achieve the most desirable outcomes.
Making sure that there is open communication, clear accountability, standardized practices, and measurable outcomes are a just a few things that the public and private sectors can do to improve the project and partnership's success. As seen in the graphic below, critical practices, when done simultaneously, can lead to greater success and more opportunities for future work.
Industry experts who have been involved with several successful PPPs have some great insight into what specifically contributed to successful partnerships and project outcomes. According to these experts…
Successful Public-Private Partnerships Have:
- A commitment to a strong partnership beyond the terms of the contract
- Both sectors have benefited so much from the expertise of the other that they wish to continue their partnership in other forms and contracts.
- Built-in mechanisms to share perspectives and opinions about the project
- The private and public sectors establish open communication with one another in which both sectors establish their needs and desires.
- A true understanding of what it means to be a “partner"
- Both sectors understand that they equally contribute to the partnership because they both provide integral resources and advisors.
- The motivation to improve public service delivery by drawing on private-market skills and innovation
- It is understood that the goal is to construct, improve, and sustain public sector infrastructure by utilizing private sector resources.
- A clearly defined set of measurable goals and processes
- Project outcomes and processes are established upfront with a clear understanding of the timeline, capital, resources, and staffing involved to achieve those outcomes on-time and within budget.
- The ability to relay risks to the entity best able to manage them
- In most PPP models, the majority of risk is transferred to the private sector because they are the ones deemed most capable and best equipped to oversee project planning and execution.
- The political will to loosen bureaucratic/political control over the project
- Both parties are willing to allow some room for leverage and some loosening of authoritative constraints so that each sector can fully contribute to the project without restrictive, external forces influencing major decisions.
- A clear decision-making hierarchy
- Both entities are in agreement with one another when it comes to following decision-making processes and responding to the requests from leadership so that there is no confusion or misunderstanding.
- Clear accountability and transparency of the procurement process
- Each sector holds themselves responsible for the decisions and roles they play in the partnership and maintain full transparency in their planning, execution and sustainment of projects.
Successful Public-Private Partnerships Can:
- Create institutional certainty and trust of the other sector
- Educate the public about PPP potential and success for future infrastructure
- Provide sufficient resources and experienced advisors for collaborative effort
- Adopt standardized procurement practices that can be transferred to other projects
Because the public and private sectors specialize in different areas and services, the combination of expertise and resources from each sector can be best utilized through public-private partnerships. The public sector should be open to the vast knowledge, technology, and expertise that can often be found in private firms.
Consultants with experience in finance, engineering, business analysis, legal issues and more can offer their services to the public sector through PPPs and vice versa.
While a government agency should always have the final say in who they choose to work with, there is no doubt that there are private companies who are eager, experienced, and capable of designing, building, operating, and maintaining public sector infrastructure over a long period of time to ensure the best delivery of services.
At Robbins-Gioia, LLC (RG), we partner with our clients to test and refine every solution to meet their exact needs. We take pride in tackling complex challenges with fresh insights and helping unexpected possibilities become real. To learn more about Public-Private partnerships, visit www.teamrg.com.