Success Factors in Public Infrastructure Project Management
Public infrastructure projects drive a country’s economic success – providing the ability to grow and become more viable and competitive in world markets. Constructions such as roads, airports, bridges, buildings, complexes, and the delivery of essential services, also improve the quality of life for citizens.
As much as public infrastructure projects create positive impact on societies, influence cultures, and affect lives, when they fail the negative impact is far-reaching. It is estimated that for every US$1 billion spent on a failed project, US$135 million is lost forever… unrecoverable. The cost of failure, however, can be more than purely financial. When projects involving billions of dollars’ worth of investment overrun on budget or time the result can hurt the tax-payer, delay essential improvements, and even trigger civil unrest. The results can topple governments.
Avoiding failure
The efficient management of these projects presents challenges of vast complexity to those who conceive, design and execute them. Successful public infrastructure project management is driven and enabled by coordination and control of assets and people, often across diverse locations and time zones. A wide range of skills and an enormous amount of information require systems and capabilities designed to support financial control and risk mitigation, drive operational excellence, and harness the real value of innovation.
Project level visibility
Public Infrastructure Management (PIM) addresses the responsibilities for eliminating wasteful spending, selecting the right projects, allocating the right resources to ensure on-time and on-budget completion, and coping with changes. The discipline and its related practices and processes enables those charged with public infrastructure projects to respond competently and efficiently to the widest possible stakeholder interests. Government bodies, public organisations, taxpayers and often the media will give close attention to how effectively public infrastructure projects are managed and how wisely they use public money and respond to strategic economic goals. A 2013 report by Ernst and Young suggests that global infrastructure demand will require $57 trillion in investment by 2030 (based on projections of demand equalling 3.5% of global GDP, 2013-2030).
Making informed decisions - the winning formula
The inability to deal with unanticipated changes is one of the biggest threats to the on-budget and on-time completion of infrastructure projects. It comes about when project management teams cannot see the problems in advance. Such foresight can be enabled by predictability and deterministic modelling of risk and development scenarios but this approach is not enough in itself.
Information, and how you use it, is critical. Visibility is all empowering. The two put together become a winning formula for successful public infrastructure project management.
Investment decisions must be of a strategic nature, aligned with national, provincial or municipal strategic objectives. Following these decisions through to successful completion depends on exercising complete visibility.
Greater visibility enables better planning, tighter coordination and improved productivity
The roadmap to successful project completion follows three fundamental steps:
- Establishing strategic direction
- Communicating expectations
- Implementing strategy in the areas of:
- financial control and risk mitigation: giving executives and state-sponsors visibility into wider activities, and overall commitments, as well as potential change factors that can affect overall project direction; offering financial metrics relating to the traceability of funding to ensure activities are aligned to the overall strategic direction.
- operational excellence: giving a range of operatives in diverse locations the ability to extract insight to support longer term objectives and their day-to-day decision-making process.
- innovation: using optimum systems and processes to keep projects on track, on budget and in line with the government’s and constituents’ expectations.
It is in the foregoing three areas of strategy implementation that real-time visibility on project progress serves to drive stakeholder objectives within specific constraints of cost, time, and quality across the organisation. Putting the right systems in place to monitor performance, and ensure optimal use of the many skills that the project involves, will streamline project coordination.
