IMplementaton in Project Management

8/10/2019 IMplementaton in Project Management

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Project Implementation


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Contents Introduction to Project Implementation

Project Activation

Project Operation

Approaches to Project Implementation

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Project Implementation Plan

Factors Affecting Project Implementation

Project Management Defined

Aspects of Project Management

Characteristics of a good Project Manager


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Project implementation or execution follows

up on the phases of project planning and

initiation.

inputs (financial, physical, informational, etc)

to carry out the project management plan.


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Project Implementation

Process whereby project inputs areconverted to project outputs. May be lookedat as:

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.

Putting into practice what was proposed in theproject document (i.e. transforming the projectproposal into the actual project.)

Management of the project or executing theproject intentions.


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Project Implementation (cont.)

Implementation usually done by implementingagency (organization) that prepared the project andreceived funding for it.

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Other organizations that participate in theimplementation of the projectby way of collaboration, say by according good working

relationship, extending technical advice or seconding theirstaff to the project

are referred to as co-operating agencies.


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Project Implementation phase

involves: Project activation, and

Project operation

Project activation

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This means making arrangements to have the projectstarted. It involves coordination and allocation ofresources to make project operational.

Project operation This is practical management of a project. Here, project

inputs are transformed into outputs to achieveimmediate objectives.


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Boss-Centred Leadership Subordinate-Centred Leadership

Use of Authority

by the Manager Area of Freedom

for Subordinates

Mansgement Styles

anager

Makes

decision and

announces it

Manager

Sells

decision

Manager

Presents

Ideas and

Invites

questions

Manager

presents

tentative

decision

subject to

change

Manager

presents

problem, gets

suggestions,

makes

decision

Managerdefines

limits, asks

group to

make

decision

permits

Subordinates

to function

within limits

defined by

superior


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Interpersonal Skills

Tenacity

Make work appear

enjoyable

Have a Vision

See Systems Context

and strategic context

of the project

Promote Empowerment

Characteristics of Good Project Managers

Take Risks and

show Courage

Ability to Motivate

Communication Skills

Mentoring and Guidanceability

Knowledge and

Competency

Ability to inspire Trust and

Confidence

Ability to keep abreast

of all project-related

developments


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Strategist

Visionary Counsellor

Diplomat

The Many Hats of a Project Manager

Negotiator

Decision-Maker Integrator Influencor

Mentor

Conflict Manager

ExpeditorDesigner


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Project Managers Role

Managing customer expectations

Carrying out project start-up activities

Directing and supporting the project team by using

leadership skills

Communicating project status

Managing change to control deviations from theestablished plan

Resolving issues in a timely manner

Maintaining the project notebook


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A good project manager should:

have working knowledge in several fields

be able to understand general managerial

Characteristics of a good project

manager

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problems

have active interest in training anddeveloping subordinates

be able to delegate some tasks tosubordinates


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A good project manager should:

know the project and understand its objectives

know the systematic process for managing

Characteristics of a good project

manager (cont.)

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be able to answer the following questions:

What is the project for?Why is it required?Whom does it serve?How is it justified?How is it going to be used?


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Innovative

High Response Rate

Conflict Management

Self-Directed Committed

Risk-Sharing

Innovative BehaviourMembership

Self-Development

Charachteristics of High-Performing Teams

High-Quality

On-Budget

On-Time

Change-Oriented

High Morale and Team Spirit

Enjoy Work

High Need for

AchievementsMiminal Reliance

On ProceduresQuality-Oriented

Effective Cross-FunctionalInterfaces & Alliances

Effective Communications


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(A(Work & Team Structure

Team participates in project definition and work plans

evolve dynamically

Factors Which Determine Project Team Performance

Team structure and responsibilities evolve and change asneeded

Broad information sharing

Team leadership evolves on the basis of expertise, trustand respect

Minimal dependence on bureaucracy, procedures andpolitics


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(B) Communication & Control

Effective cross-functional channels and linkages

Ability to seek out and process information


Effective group decision-making and consensus

Clear sense of purpose and direction

Self-Control, accountability and ownership

Control is stimulated by visibility, recognition,

accomplishments, autonomy


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(C) Team Leadership

Minimal hierarchy in member status and position


,

trust and need

Clear management goals, direction and support

Inspires and encourages


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(D Attitudes & Values

Members are committed to established objectives and

plans


Shared goals, values and project ownership

High involvement, energy, work interest, need for

achievement and pride, self-motivated

Capacity for conflict resolution and resource-sharingTeam building and self-development

Risk-sharing, mutual trust and support


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Innovative behavior

Flexibility and willingness to change

High morale and team spirit


High commitment to established project goals

Continuous improvement of work process,

efficiency and quality Ability to stretch beyond agreed-on principles


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Drivers

Team-

Internal

Organizational

Environment

External

Business

Environment

Model for Analyzing Team Performance

Managerial

Leadership

Barriers

ristics

and

Team

Performance

Internal

Organizational

Environment


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Clear project plans and objectives

Good interpersonal relations and shared values

Good project leadership and credibility

Professional growth potential

Professionall interestin and stimulatin work

Project Team Performance The Drivers

Project visibility and high priority

Proper technical direction and team leadership

Qualified, competent team personnel Recognition of sense of accomplishment

Management involvement and support


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Communication problems Conflict among team members or between team and support

organizations

Different outlooks, objectives and priorities perceived byteam members

Poor qualification of team or project leader

Project Team Performance The Barriers

,

Insufficient resources

Insufficient rewards

Lack of project challenge and interest

Lack of senior management support, interest and involvement Lack of team definition, role conflict and confusion

Lack of team member commitment


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Project Team Performance The

Barriers Poor project team / personnel selection

Shifting goals and priorities

Unclear team leadership and power struggle

Unstable project environment, poor jobsecurity and anxieties


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Negotiate the work assignment Communicate organizational goals and objectives

Plan the project effectively

Staff and organize the project team

Define the project organization, interfaces andre ortin relations

Effective Team Management Some Recommendations

Build a high-performance image

Define work process and team structure

Build enthusiasm and excitement

Ensure senior management support Define effective communication channels and methods

Build commitment

Conduct team-building sessions

Ensure project leadership


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Create proper rewards systems

Manage conflict and problems

Ensure personal drive and involvement

Effective Team Management Some Recommendations


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Roadmap to Project Management Success

Form

ProjectTeam

Statementof Work

ResponsibilityMatrix

Purpose

Project Background

Project Deliverables

WorkBreakdown

Structure

R A

A

SS

R

Network Gantt BudgetResourcePlan

PerformTasks

TIME

CTN

OTE

BOOK MEET

IN

PLAN

ShareLessonsLearned

EvaluateSuccess

ConductClose-Out

Meeting

UpdatePlan

ResolveIssues

ManageChange

TrackProgress

LEADERSHIP

COMMUNICATION

PROJ

GS

REPORTS

LESSO

NSLEARNED

IMPLEM

EN

T

CLOSE

-OUT


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Implementation Model

Step 1

Perform Tasks

Step 3

Manage Change

Step 4

Update the Plan

Step 2

Track Progress

ResolveResolve

IssuesIssues


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Percent Completion Reporting

Period 1 2 3 4 5 6 7 8

Planned 20 40 60 90 100

Actual 20 40 60 90 94 96 97 97.5

Everything looks fine until you reach 90%!Everything looks fine until you reach 90%!


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Project operation and maintenance

Operation and maintenance

To attain value and maximum returns, the

district/municipality or the beneficiaries organize for

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e ac y o ave e pro ec proper y manageand maintained regularly.

An operation and maintenance manual is prepared

by the contractor and handed to the district /beneficiaries.


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Approaches to project implementation

Top-down approach Implementation mainly done by agencies from outside

the community with limited involvement by the

beneficiaries.

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- Beneficiaries implement the project. Outside agencies

may provide the financial resources and technicalassistance.

Collaborative participatory approach Both top-down and bottom-up approaches to project

implementation are applied in the process.


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Project implementation plan (PIP)

If PIP not carried out during the projectdesign process and embodied in the

project documents, it is carried out at the

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pro ect act vat on stage.


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Project implementation plan includes:

a) The project implementation schedule

This is concerned with:

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outputs?

What is the sequence of these activities?

What is the time frame for these activities?Who will be responsible for carrying out each

activity?


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Project implementation plan includes:

The following methods may be used to

answer the above questions:

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Project Evaluation and Review Techniques (PERT)

Simple formats


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What is a GANTT Chart?

The Gantt chart is also referred to as the

progress chart.

It is a chart showing the timing of project

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.

It is one of the techniques of project

scheduling, which depicts the frequency of

activities and determines the period of timefor implementation.


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How to determine a GANTT chart

Determine the parts or implementationphases of the project and the sequence inwhich the associated activities shall be carried

out

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Then estimate the amount of time requiredfor each activity

List the activities that can be carried out at thesame time and identify those to be carried outsequentially


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How to construct a GANTT chart

Time represented on the horizontal axis, and

activities on the vertical axis.

Bars are entered to indicate the time period

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progress at any particular point in time.


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Example: Maize farming project

Activity

Marketing

Threshing

Harvesting

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Weeding

Planting

Preparing seedbed

J F M A M J J A S O N D

Time period/ months


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The Simple Format

ACTIVITY STARTING

DATE

ENDING

DATE

COST RESPONSIBLE

PERSON

REMARKS

- Preparing seed bed

-

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- Weeding

- Harvesting

- Storage

- Threshing

- Marketing


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Practical

Develop

a Gantt chart

Simple Format

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pro ect mp ementat on sc e u es n re at onto the identified projects in the projectidentification session.


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Project implementation plan (cont.)

b) The role of the implementing agency

The specific responsibilities of the key staff

during project implementation and

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monitoring are outlined.

c) Beneficiary participation

The involvement of the beneficiaries inplanning and implementation and what isexpected of them is spelt out.


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d) Organizational structure and staffing

Here the following are sought:

Project structure for purposes of management

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Job descriptions and specifications for the staff

Technical assistance if needed

e) Financial managementThis looks at funds management, accounting period,financial reports and statements and how often theywill be made?


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f) Reporting system

This looks at who will be reporting to whom and howoften. There is need to design standard reporting

formats.

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g) Sustainability

The concept of sustainability is based on belief thatproject should result in benefits that have lasting effect.Project should be sustained beyond the life of funding -especially if it is a grant.

Project should not exhaust the available resources likeraw materials and labor.


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Time control and remedial action

Time taken to implement project activities is one

measure of successfulness of supervision or

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.

Supervisor pays particular attention to time control

measures, time scheduling and its supervision, time

extension and postponement, damages for non-completion and defect or warranty period.


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Supervision of implementation of projectschedule

This involves a set of checks and balances to ensure

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.

To ensure that the time schedule is being adhered to,the project activity time listing can be of greatimportance.


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Project Activity Time Listing

Activity

earliest time

Activity

latest time

Activity

code

Activity

Description

Activity

duration

Start Finish Start Finish

Progress

remark

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Practical

Using the Project Activity Time Listing,

develop a Project Activity Time Listing table

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identification session, and fill it in.


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Factors affecting project

implementation

Factors that lead to

success of projects

Factors and problems

that lead to failure of

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o t ca omm tment

Simplicity of Design

Careful preparation

Good management Involvement of

beneficiaries/community

pro ec s

Financial Problems

Management problems

Technical problems Political problems


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implementation

Other typical implementation problems

Poor scheduling of projects leading to delays in

Poor scheduling of projects leading to delays in

im lementation.

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Misallocation of funds

Delay and sometimes lack of counterpart funding

Lack of accountability and transparency

Bureaucracy in decision-making.

Selfishness/nepotism/favoritism by some project managers.


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implementation

Other typical implementation problems (cont.)

Weak monitoring systems

Natural calamities like drought, earthquakes,

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, .

Policy changes

Migration of beneficiaries

Lack of team work Lack of incentives for implementers.


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Project management

Management may be defined as;

Getting things done from the available resources,the way you want them to be done.

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Project management defined

Project Management is an all-embracing termcovering the management of every detail of a

project (Project cycle) and may be defined as, theprocess of planning and directing a project from itsinception to its final completion.


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Project management (cont.)

Project management decisions - a necessary function forsetting up a project. It is concerned with:

Forecasting

Setting objectives

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o cy ma ng

Planning - determines success/failure of project. It has threemain aspects:

ProgrammingScheduling and

Budgeting


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Project control - To control is to compare actualwith planned achievements and take action to correctany adverse deviations. It involves:

Plans of Operation

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These are the result of the planning process of Projectmanagement.

Review and UpdatingReview is necessary to determine whether the project isproceeding according to plan or not. Updating is recording thestate of the project as shown by the reviews, or of makingamendments.


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Project Action - When review has shown a project

to be deviating from plan, action is required to

restore the operation to its planned characteristics.

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Allocate management responsibilities

After the contract has been signed,responsibility for contract management willnormally be transferred to a contract

management team established by theAuthority.

If a roads agency, for example, has more thanone contract, it makes sense on grounds of

efficiency for a single contract managementteam to manage all ongoing Project contracts.


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A contract management team, reporting to a contractdirector, will carry out many day-to-day contractmanagement activities.

It is desirable to include the proposed contract director

early stage of the procurement process, or at least toallow him/her to follow the procurement process andhave access to procurement team members.

A good understanding of the project and its inherentrisks will enable him/her to devise an adequatecontract management strategy.


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It is important for the Authority to set out, priorto choosing the preferred bidder, the basicframework under which the contractmanagement team will operate.

uncertainties. Indeed, bidders will need toincorporate monitoring and contract compliancecosts into their bids.

They should therefore be provided with a clearindication of the type and frequency ofinformation required from them.


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Monitor and manage project delivery

and service outputs

The contract should have clearly stated theobligations of the Company and defined theexpected service characteristics, outputs and

quality standards. Effective contract management depends, in the

first place, on getting the Project contract right.

This implies setting out the procedures that

guarantee close monitoring of the Companysperformance and general compliance with theagreed contract.


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The contract management team will normallystart by agreeing with the Company all thetasks that each party needs to undertake and

the appropriate timeframes for theircompletion.

These operational details need to be set out inthe contract administration manual

(consistent with the project contracts) at thestart of the project implementation phase.


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Effective contract management will help to

identify and monitor the Companys

construction and operational performance.

project risks over the life of the contract.


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Regular monitoring

In order to effectively monitor the implementation of theproject, the Company will need to provide the contractmanagement team with operational and financial data onan ongoing basis.

The contract should have set out the basic information.

Often, more detailed requirements are specified at thestart of the implementation phase.

The contract management team should limit its request forinformation to the data necessary for effective monitoringand ex post evaluation of the project.

Excessive data collection imposes an unnecessary burdenon the Company and the Authority.


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The contract management team will, for example,need to:

monitor the attainment of key performanceindicators;

procedures to ensure that these systems are inplace and effective;

establish and manage the day-to-day relationship

with the Company; and report regularly to the stakeholders.


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Risk management

The risks that the contract management team

will need to manage can be classified as

follows:

the parties;

intrinsic risks borne by the Authority;

project risks not contractually allocated; and

risks associated with changes to the contract.


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It is essential for the contract management

team to have a clear understanding of the

requirements of the contract and the rationale

.

The role of the team will vary according to

whether or not these risks have been

identified in the contract and contingencyplans have been established.


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Potential problems should be identified earlyand acted upon.

If the problem appears to be persistent and

the Com an s first oint of contact cannotdeal with it, the issue should be dealt with at amore senior level.

Such escalation procedures will typically bespecified in the contract administrationmanual.


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Managing changes permitted in the

contract

The contract will set out the triggers and

methodologies for agreeing and implementing

changes to the contract.

,

administrative steps that need to be taken in

order to agree or implement permitted

changes.


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The contract administration manual should specifylogistical and administrative details such as:

the person to whom a request for a change mustbe sent;

proposed change;

the persons authorized to agree a change onbehalf of the Authority and the Company; and

the person responsible for overseeing andverifying implementation of the change.


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Changes permitted under the contract are oftencomplex and need to be decided at senior level.

They typically include material changes in outputspecifications, refinancing or the consequences of a

.

Many contracts contain provisions governing thepotential refinancing of the project, in particular thesharing of gains from such refinancing.

It should be noted that the consent of the Companyslenders may be required before certain changes to thecontract are implemented.


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While contract renegotiations triggered by changesthat are not permitted in the contract may be acommon feature of Projects in some countries , theassociated risks should be acknowledged and

mitigated. con rac s can e es gne o m n m ze ma orrenegotiations at a later stage.

Contract renegotiations require careful analysis and adialogue between the parties before contract changes

are agreed and implemented. The use of an experienced, trusted and neutral

facilitator may be beneficial.

While some renegotiations are efficient, many areopportunistic and should be discouraged.


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Renegotiations of significant aspects of the contracthave considerable implications for the parties and arein principle forbidden .

They are generally regarded as undesirable because:

competitive bidding may be distorted: the most likelywinner is not the most efficient company but the onemost skilled in renegotiation;

as renegotiations are carried out bilaterally, the positiveeffects of competitive pressure are lost; and

renegotiations often reduce the overall economicbenefits of arrangements and might have a negativeimpact.


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Dispute resolution

Contractual disputes are common in Projects for

a number of reasons. For example:

because the contract is long-term and unexpected

because Project arrangements tend to be

complex.

The mechanisms available to resolve disputes andconflicts are a major part of the assessment of

contract risks by private investors in projects.


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The typical dispute resolution mechanisms are:

the national court system (litigation);

arbitration (national or international);

expert determination of some kind. This is often used

or to give an interim decision which can then beappealed against in litigation or arbitration;

mediation or conciliation (where the third party doesnot give a binding decision but enables the parties to

reach an agreement); and a decision by a specialized regulatory body.


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Effective relationship management in a projectfacilitates the easy resolution of disputes in the future.

However, if a party resorts to an inappropriate disputeresolution process, the process may damage the

.

It is therefore fundamental that an appropriate disputeresolution process is set out in the contract.

This should be done with the support of experiencedlegal advisers.


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When the contract ends

A contract should include detailed provisions dealingwith its termination.

The main issues to be addressed are:

the circumstances in which the contract may be

the payment (if any) that must be made by theAuthority to the Company upon termination(depending on the circumstances); and

the condition of the assets when they are handedover to the Authority following termination.


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Grounds for termination

The typical grounds for termination are:

expiry of the contract term;

default by the Company; default by the Authority;

a voluntary decision by the Authority; and

termination in the event of prolonged forcemajeure.


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The contract should describe in detail thecircumstances that allow a party to terminate thecontract, in particular where the other party hasdefaulted on its obligations.

For it to lead to termination, a breach of contract haso e un amen a n na ure an s ou w erepossible) be subject to cure periods.

For example, the Authority would normally be entitledto terminate the contract in the event of insolvency or

bankruptcy of the Company or of a serious deficiencyin the service provision (e.g. where health or safety isjeopardized) that is not promptly remedied.

A detailed list of all the breaches that entitletermination should be set out in the contract.


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Particular attention should be given to the issue ofpersistent breaches (i.e. the accumulation of anumber of breaches, each of which would not in itselfbe enough to trigger termination but all of which

together constitute fundamental non-performance). e cr er on or assess ng e ex s ence o a pers s enbreach should be as objective as possible.

This can be achieved by reference to the accumulationof penalties, deductions, performance points or

warning notices over a specified period of time. Beyond a certain threshold, the Authority should have

the right to terminate the contract.


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The typical example of default by the

Authority is the nonpayment of the sums

owed to the Company (e.g. the service fee).

not adequately adjusted the Companys

remuneration in accordance with the terms of

the contract.


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Termination payments

contracts usually require the Authority to makepayments to the Company if and when thecontract is terminated.

These provisions are generally complex and need

advisers, taking into account a number of factors,such as:

fairness;

incentives for the Company and its lenders; and bankability.


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Specifying termination payments can be

important even if the contract is never

terminated.

contract, the Authority should not accept a less

favorable outcome than simply terminating and

making the required payment.

The termination payment can act as the

reference price in the renegotiations.


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Contract expiry

Projects are usually structured so that the Authoritymakes no payment to the Company when the contractexpires at the end of its scheduled term.

Termination payments are, however, envisaged upon

contract expiry in certain circumstances. A typical case is that of new assets constructed at some

stage during the life of the contract as a result of anextraordinary event (this may involve a lump-sumtermination payment from the Authority).

Similarly, where Project assets have a particularly longlife compared to the term of the contract, the paymentof a residual asset value upon expiry may becontemplated.


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Terminat ion for default by the Project

Company

Termination for Project Company default is the final stageof a process which starts when a project is failing toperform in accordance with the requirements of the Projectcontract.

The Project contract should set out the various.

These will typically include failure to completeconstruction, persistent failure to meet performancestandards and insolvency of the Project Company.

It should be noted that the Project contract will also set out

those circumstances in which failure to perform can not beused to trigger termination (the so-called relief events).


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Where the default by the Company is caused by failureof one of its subcontractors (e.g. insolvency, poorperformance, corruption), the Company should havethe contractual ability (in its subcontracts) to replace

the non- erformin subcontractor and seektermination damages from it.

These damages should be backed (at least in part) byperformance bonds or guarantees and set at a level

which would allow the Company to meet anyadditional costs associated with the replacement of thesubcontractor.


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Insolvency of the Company is an importantcause of default.

This can occur where the Company is no

lon er able to service its debt in line with theagreed schedule.

In this case, lenders could choose toaccelerate their debt (i.e. make the entire

debt due and immediately payable).

This would force the Company into insolvency.


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In the event of Company default, the lenders

should be allowed to step in to rescue the

project and protect their loan.

lenders to take control of the project in such

circumstances.

The lenders right to step in is typically provided

for in a direct agreement entered into between

the Authority, the Company and the lenders.


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Termination payments for Company defaults

are a key issue in contracts as they are

fundamental to their bankability.

the compensation payment that the Authority

is obliged to make to the Company / its

lenders


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repayment of all or a pre-specified part of theoutstanding debt (to the extent that it has beenproperly used for financing the project assets);

the depreciated book value of project assets (there are

several variants of this general approach); the net present value of the expected future net cash

outflow that would have been payable by the Authorityif termination had not occurred (i.e. the expectedservice fee less the costs that the Authority will have to

incur as a result of the termination); and an open-market sale (i.e. the Authority re-tenders thecontract, selects a new Company to continue with thecontract and then pays the original Company/itslenders the proceeds it receives from the sale).


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Each of these methods has pros and cons. For example, it isoften argued that the lenders should not be guaranteed fulldebt recovery upon termination as this would remove theirincentives to conduct thorough due diligence and carefulproject monitoring.

-,there is no liquid market for contracts.

Finally, the net present value approach may beconceptually appealing, but forecasting future revenuesand costs can be difficult and lead to disputes.

This explains why the parties often adopt solutions that relyon simplicity and certainty of the outcome.


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As a general principle, it is important to

ensure that the public sector should not be

financially incentivized to seek early

.

Equally, lenders should not expect to avoid

financial losses at the undue expense of the

public sector.

T i t i f d f lt b th


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Terminat ion for default by the

Authority / voluntary termination

To promote fairness, incentives for the private sectorand bankability, the contract should ensure that theCompany is not financially harmed if terminationoccurs as a result of default by the Authority orvoluntary decision by the Authority.

n ese c rcums ances, o e en ers an eequity investors should be fully compensated.

While calculating the compensation due to the lendersis relatively easy (e.g. debt outstanding, unpaid interest

and fees and breakage costs as a result of thetermination of the hedging agreement), defining thecompensation owed to the equity investors can becomplex.

T i t i f l d f


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Terminat ion for prolonged force

majeure

contracts normally provide for the possibility for either party

to terminate where a force majeure event precludes

performance of the obligations for a prolonged period of

time.

,party is at fault, the burden of termination should be shared.

The compensation payable by the Authority will therefore

normally be (i) higher than that owed in the event of

Company default but (ii) lower than that due on Authoritydefault.

The compensation would normally cover the outstanding debt

It may sometimes also cover the value of the equity injected

into the project (but exclude any return on that equity).

Oth tt l t d t t i t i


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Other matters related to terminat ion

payments

When defining compensation payments on termination, thecontract will have to tackle a number of other issues, suchas:

the treatment of subcontractors costs and profits forgoneas a result of termination;

. .should these be dealt with as senior debt or equity?);

the treatment of cash balances in reserve accounts;

the treatment of insurance proceeds; and

the choice of a discount rate for the present valuecalculation (e.g. nominal or real? pre-tax or post-tax?weighted average cost of capital?).

A t diti t i f th


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Asset condition at expiry of the

contract The contract should contain provisions to ensure that the

assets are handed back to the Authority in goodcondition.

For example, the contract could include:

indicators of the condition the assets must be in at contract. . ,ability to meet certain performance tests);

a third party assessment of the condition of the assets andof the works to be completed to meet the requiredstandards (such assessment should be carried out by an

independent expert sufficiently in advance of the expirydate);


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retentions made from the service fee over adefined period prior to expiry (the proceedsbeing held as a guarantee in a reserve

account); and verification by an independent expert that the

works required to meet the hand-backconditions have been completed satisfactorily

(this could also trigger the release of theretention sums to the Company).


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Ex post evaluation

A sound evaluation of a project requires thepublic sector to:

identify the public body that will undertake

the review of a articular ro ect ensure the independence of that body vis--

vis the teams responsible for implementingand managing the contract;

define the questions that need to be answeredin the evaluation exercise.


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Define the institutional framework

Ex post evaluation of projects enables lessons

to be learned from projects that have already

been implemented and covers both successes

.

These lessons can improve future decisions on

whether to take the PPP route, how to design

contracts and ultimately how best to prepareand implement projects.


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It is important that the information needed for

ex post evaluation is thought through carefully

and specified in the contract.

gathered during the course of the project by

the Company, with the support of the

Authority.


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Timing the evaluation of a is an open question.

A balance is needed between obtaining usefulinformation quickly in order to inform currentprocesses and obtaining meaningful data on

performance. Evaluation around 12 to 18 months after the

commencement of operations will provide informationon the bidding process, the delivery of the projectassets and initial performance.

Subsequent evaluations will provide better informationon operational performance and the actual delivery ofthe expected value for money.


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The purpose of an ex post evaluation is

to evaluate the merits of PPPs associated with

a particular type of project; and

to ent y potent a ssues re at ng to t e

implementation or management of specific

contracts (e.g. availability based Projects).


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Evaluation requires the establishment ofrelevant criteria and methods and the capacitywithin the Authority to carry out the process.

In order for this rocess to be successful it isimportant that the public authorities:

define the set of questions they would like tosee answered; and

decide on who is best placed to answer thosequestions.


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The type of body most suitable for the ex postevaluation exercise depends on the objectivesof the evaluation.

It is not unusual for exam le for nationalaudit units to undertake such studies.

In some instances, ex post evaluation can becontracted out to a consulting firm, especially

when in-house expertise is not availablewithin a public body.


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But whatever form it takes, the Authority will

have to ensure that the body conducting the

evaluation is independent from the teams

the project subject to evaluation.


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Develop an analytical framework

Once responsibilities have been assigned and

the aim of the ex post evaluation study has

been defined, it will be necessary to decide

appropriate for achieving the aims of the

study.


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This implies defining:

the evaluation criteria and expected outcomes

of the project; and

t e appropr ate a ternat ve


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A well-designed contract should provide for

sufficient information, collected during the

monitoring phase, to support this evaluation

.


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projects will normally be defined in terms ofvalue for money.

This implies identifying both the benefits derived

from project outputs and the cost of deliveringthose outputs (benefits and costs being bothmonetary and in terms of timing).

However, more qualitative benefits and costs,

such as service quality, contract design and riskallocation, also need to be considered in theevaluation.


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In addition to examining the benefits andcosts, the evaluation will need to identifywhich alternatives should have been looked

at. These can be alternative procurement models

to different project delivery andimplementation procedures.

It is common practice to use the public sectorcomparator as a relevant alternative.

IMplementaton in Project Management

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