Evaluation of Stakeholders Perspective on Success Factor and Success Criteria for PPP Projects

by

LITERATURE REVIEW3

Introduction3

Development of Relevant PPP Studies4

Nature of Infrastructures in Nigeria7

Public Private Partnership (PPP)8

Provision of Local Service Delivery through a Public-Private Partnership Arrangement10

Funding Infrastructure through PPP12

Tendering Procedures in PPP15

Criteria for private partner selection21

Methods for Private Partner Selection25

Reasons behind the Initiatives of PPP28

Characteristics of PPP Projects36

Involvement of Private Capital Investment in Large Amount36

Contract of Long Period37

Multi-functions Responsibilities of the Private Sector37

Risks Sharing between the Private and Public Sectors37

Payment Based on Performance38

Potential Pitfalls and Disadvantages of PPP39

High Procurement Cost39

Lengthy Contract Negotiation40

Difficulty in Specifying Service Quality40

Loss Control of Private Sector41

Lack of Competition41

Conflict of Interests & Lack of Experience41

Difficulty in Evaluating VFM42

Public and Political Concern42

Staff Concern43

Impacts of PPP Implementation Worldwide44

What is Known, What is not Known, and What Needed to be Known about PPPs47

Why to Determine the Impact of PPPs?49

Success factors of PPP50

An Overview of Critical Success Factors of PPP Projects50

Various Lists of Critical Success Factors of PPP by Different Researchers52

Key Stakeholders of PPP56

General Public - Decision makers to support to the PPP project56

Private Sector - Decision maker for the partnership with public sector57

Public Sector (Government) - Decision maker for the partnership with the private sector58

Stakeholder Theory58

Tools and Techniques for Stakeholder Management66

Examples of Stakeholder Management Tools68

Influence of the Three Parties on the Effectiveness of PPP69

Overview70

Global Outlook71

Structuring72

The Perception of Risk74

Satisfaction of the Stakeholders75

Conclusions76

REFERENCES79

LITERATURE REVIEW

Introduction

This chapter presents a thorough literature review comprising the theoretical discussions and the lessons, presented in the literature, learnt from the actual cases from all over the world. Three major topics are reviewed in this literature review. First of all, an overview of the literature describing Public Private Partnership (PPP) in the context of Africa and Nigeria is given. Second topic covers the literature describing the success factors of a PPP. In last, the stakeholder theory is reviewed. Most of the literature review surrounds the studies done focusing the PPP projects of infrastructure.

According to Sulivan and Sheffrin (2003), functioning an economy in a country primarily require the provision of facilities, services, and products. Developing infrastructure can fulfil the need of organisational and physical structures in the form of governance, health services, bridges, roads, buildings, industries, and so on. Fulmer (2009) defines the term infrastructure as a physical component in which provides the interrelated systems of services and commodities that are necessary for enabling, sustaining, and enhancing the conditions of societal living. In simpler words, all the technical structures like telecommunications, electrical national grids, sewers, water supply, roads, and so forth that support a society are regarded as infrastructures.

In this literature review, understanding of PPP, different methods of the arrangement, its characteristics, potential pitfalls, and success factors are presented. Among, the success factor, satisfaction of the stakeholders is emphasised. For this, key stakeholders of PPP are identified, and the stakeholder theory is discussed. Perception of stakeholders about the risk associated with PPP and the influence of the stakeholders on the success of PPP are also reviewed.

Development of Relevant PPP Studies

The experience by PPP executors in the UK, the US and Australia has ...