• Achieving Best Value in Private Finance Initiative Project Procurement

      Akintoye, Akintola; Hardcastle, Cliff; Beck, Matthias; Chinyio, Ezekiel A.; Asenova, Darinka (Routledge (Taylor & Francis), 2003)
      The wherewithal of achieving best value in private finance initiative (PFI) projects and the associated problems therein are documented. In the UK, PFI has offered a solution to the problem of securing necessary investment at a time of severe public expenditure restraint. In PFI schemes, the public sector clients must secure value for money, while the private sector service providers must genuinely assume responsibility for project risks. A broad-based investigation into PFI risk management informs the discussion in this paper. It is based on 68 interviews with PFI participants and a case study of eight PFI projects. The research participants comprised of contractors, financial institutions, public sector clients, consultants and facilities management organizations. The qualitative software Atlas.ti was used to analyse the textual data generated. The analysis showed that the achievement of best value requirements through PFI should hinge on: detailed risk analysis and appropriate risk allocation, drive for faster project completion, curtailment in project cost escalation, encouragement of innovation in project development, and maintenance cost being adequately accounted for. Factors that continue to challenge the achievement of best value are: high cost of the PFI procurement process, lengthy and complex negotiations, difficulty in specifying the quality of service, pricing of facility management services, potential conflicts of interests among those involved in the procurement, and the public sector clients' inability to manage consultants. (Routledge)
    • Critical Success Factors of the BOOT Procurement System: Reflections from the Stadium Australia Case Study

      Jefferies, Marcus; Gameson, Rod; Rowlinson, Steve (Emerald Group Publishing Ltd., 2002)
      Recent trends in the provision of infrastructure development indicate that the private sector is playing an increasingly important role in the procurement process. This trend has partly arisen out of a necessity for the development of infrastructure to be undertaken at a rate that maintains and allows growth. This has become a major challenge for many countries where it is evident that these provisions cannot be met by government alone. The emergence of Build-Own-Operate-Transfer (BOOT) schemes as a response to this challenge provides a means for developing the infrastructure of a country without directly impacting upon the government's budgetary constraints. The concepts of BOOT are without doubt extremely complex arrangements, which bring to the construction sector risks not experienced previously. This paper examines perceptions of BOOT schemes in order to develop a framework of critical success factors. The developed framework is then tested against a case study of Stadium Australia, and the outcomes of the comparison are discussed. (Emerald Group Publishing Limited)
    • Outsourcing the Risk Analysis Function in 'Private Finance Initiative' Projects

      Akintoye, Akintola; Beck, Matthias; Hardcastle, Cliff; Chinyio, Ezekiel A.; Asenova, Darinka (University of Salford, 2003)
      The optimisation of risk transfer and risk management in ‘Private Finance Initiative’ (PFI) projects involves the accurate assessment of these risks. The manner in which risks are analysed and the extent, to which this function is outsourced in PFI projects, is examined in this article. The discussions are informed by an investigation conducted at Glasgow Caledonian University. Literature was reviewed, upon which a survey instrument was developed. A qualitative methodology was adopted, and involved a total of 90 interviews with diverse PFI participants in the UK. The ‘AtlasTi’ software was utilised in the analysis of data. The interviews revealed that the bulk of the risk analysis function in PFI is usually done in-house, while a minor part is often outsourced to technical, legal and financial cum insurance experts. Other disciplines consulted, albeit occasionally, include traffic engineering, environmental science, planning and surveying. The objective is to outsource those aspects where in-house expertise is deficient. When tasked with risk analysis, consultants were adjudged to usually render a good job.
    • The Justification and Implementation of Project Alliances - Reflections on the Wandoo B Development

      Jefferies, Marcus; Gameson, Rod; Chen, S.E.; Elliott, T. (University of Salford, 2008)
      The last decades have seen notable changes in the structure of organisations as well as in the management methods used in leading and directing these evolving organisational bodies. Unpredictable social, economical, technical and political aspects of a globalising society have encouraged organisations to consider forming business alliances as a risk management strategy. This has created a need for organisations to find new ways in which to compete in the continually evolving construction industry. Project alliances have been identified as a successful management strategy that is used to change current construction culture to one that promotes a win-win situation. Project alliances are a relatively new experience within the Australian construction industry with the Wandoo B Development project one of the first major projects to experience alliancing completed in 1997. This paper case studies the Wandoo Alliance by identifying and exploring the elements that influence the implementation of project alliances and justifying the reasons for its formation.