Project Management Institute

Vox populi

SPECIAL REPORT

EARNING PUBLIC STAKEHOLDER TRUS MUST BE THE TOP PRIORITY ON URBAN INFRASTRUCTURE PROJECTS.

BY SARAH FISTER GALE

ILLUSTRATION BY FRANCESCO BONGIORNI

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Some of the world's biggest cities are already bursting at the seams, and urban population trends make it clear the pressure will only increase. According to the World Health Organization, more than half of the world's population lived in urban areas in 2010—compared with just 20 percent of people in 1910. By 2050, that proportion will balloon to 70 percent.

This steady migration is putting a constant strain on the insufficient and antiquated urban infrastructure in cities around the globe. And that's forcing governments to finance massive projects ranging from updating aging roads and water-treatment facilities to creating new and more efficient transportation systems to constructing entire cities from scratch.

These super-sized undertakings are loaded with project management challenges—especially as teams are tasked with making the projects sustainable, affordable and efficient for future generations. But for urban infrastructure initiatives, the usual hurdles of securing funding and navigating government policies pale next to the risk of public-stakeholder conflict.

“Any time you try to build infrastructure against a community's wishes, it's a losing battle,” says Marc Brazeau, director general of major bridge projects at national government agency Transport Canada, Ottawa, Ontario, Canada. “You have to have community support or you won't be successful.”

That's because community members who feel their concerns are being ignored or that taxpayer funds are being spent without their consent can cause significant delays—or even cancellations. In Shifang, China, for instance, city leaders were forced to cancel plans to build a US$1.6 billion copper smelting plant after thousands of residents took to the streets to protest the project's environmental risks.

In this respect, governments that have traditionally taken a more heavy-handed approach to infrastructure projects are starting to see the benefit of building buy-in before a project begins. As budgets tighten, countries that rely heavily on government investment for economic growth are finding they can't afford the costs that come with public protest. And, in China specifically, a growing middle class is frequently prioritizing the long-term health of the environment over the short-term prosperity infrastructure projects may bring.

Yet despite the advantages of connecting with external stakeholders early on, many urban infrastructure planners forget to factor the community into the project planning process, says Mick Allworth, a partner and global chair of PMI Global Executive Council member KPMG's Cities Center of Excellence from Canberra, Australia. “They often focus solely on the objectives of the organization instead of the objectives of the community,” he says. “That's the worst thing you can do because it depletes the public's trust.”

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Focusing on internal goals may help expedite the transition from planning to construction, but in the long run, this shortcut can lead to disaster, says David O‘Brien, global head of KPMG's Cities Center of Excellence in Toronto, Ontario, Canada. “Project teams are told they must move quickly to gain a faster ROI, but engaging the public is not a step you can cut.”

And the best way to gain public support varies significantly by region. For project managers working in a foreign country, having a partner who is familiar with local customs can help reduce the risk of blowback, says Ivan Ferre Zorilla, construction project manager at UNITS-4, a construction company in Barcelona, Spain. When working on projects in China, in particular, Mr. Ferre Zorilla found that having a Chinese partner made it easier to earn public approval and get initiatives off the ground.

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“To succeed as a project manager in China, it's necessary to have a Chinese partner,” he says, “because the procedures and communication in this country are very difficult.”

Having a local partner can help project managers craft and distribute public communications that highlight the factors that are most important to the community. In China, for example, a major point to communicate is how the project will serve the greater good, Mr. Ferre Zorilla says.

“The message you transmit to the public always has to be positive and offer information about how it benefits the country,” he says.

Yet, even the most inclusive urban infrastructure plans can hit a wall when new projects come, as they often do, with higher taxes and months of noise, delays and disruption. In these instances, it's not enough to share plans and address concerns—delivering real value is the only way to gain stakeholder support.

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EVERYONE GETS A VOICE

To obtain buy-in, project teams need to make community outreach a key component of the project plan, with targeted marketing and communication efforts that not only update citizens about the project, but also factor their feedback into the planning process, Mr. O‘Brien says.

Teams should carefully consider the type of feedback they want to elicit during public forums. “It's not about telling the public what you're doing,” he says. “It's about asking them what they need, then taking the time to listen to their responses.”

Think carefully about who the stakeholder groups are and what value each one will ultimately derive from the project, adds Calvin Speight Jr., PMP, associate, infrastructure and military health for Booz Allen Hamilton, a PMI Global Executive Council member in Washington, D.C., USA.

“Everyone's vision is different,” he says. “The goal is to find the overlap of shared interest.” On urban infrastructure projects, stakeholder groups may include neighborhood associations, community interest groups, civic organizations, politicians and private businesses—and their priorities are not always aligned.

For example, energy companies may need to meet clean-energy goals, while community members are focused on getting cheap electricity. “If you appeal to the government but exclude community advocates, it will create acrimony,” Mr. Speight says.

Instead, project teams need to give everyone a chance to voice opinions and look for compromises that accommodate all stakeholders’ needs. Bringing community advocates to the table during planning also creates the opportunity to educate them about the value proposition of a project and make them part of the decision-making process.

“The greater transparency you have, the greater support you will receive,” Mr. Allworth says.

Such outreach takes time, but it can also help curb the long delays that plague project teams that don't have the community on board.

Here's how three project teams found creative ways to engage their public stakeholders, proving the cost of accommodation is far less than the price of fighting back.

CASE STUDY 1

Public tours of a water-filtration tunnel help build community support for an expensive—and otherwise invisible—infrastructure project.

When Missouri American Water launched a project to replace the aging water infrastructure in the state capital of Jefferson City, Missouri, USA in 2011, the project owners anticipated public backlash from the start.

The existing system that pumped water from the bordering Missouri River to the local water-treatment plant was 60 to 100 years old and at the end of its usable lifespan. But replacing it required digging a 19-foot-wide (5.8-meter-wide) and 80-foot-deep (24.4-meter-deep) wet well next to the river, then blasting and digging a 225-foot-long (68.6-meter-long) tunnel through the bedrock under the river to draw the water into the new facility.

The price tag: US$11.5 million.

While that might not seem like a lot for a major infrastructure project, the state's water regulations put the burden of the project's entire cost on the citizens of Jefferson City, says Ann Dettmer, communication manager for Missouri American Water, St. Louis County. Thus, community members faced a rate increase for a project that wouldn't noticeably change their quality of life.

“We know from our data that people do not think a lot about water infrastructure,” she says. “They just expect the water to be there when they turn on the tap.”

AN UNDERWATER STROLL

Rather than relying simply on public meetings and customer newsletters, the project team decided to bring community stakeholders and media to the site to give them a firsthand look at their water source.

“We saw this project as a good opportunity to make them aware of what it is we really do,” Ms. Dettmer says.

Once the well and tunnel were dug, the utility started hosting stakeholder tours. “We took them down to the bottom of the well in a crane cage, then let them walk under the river,” Ms. Dettmer says. “It created amazing stories and videos, and gave people memories they could share.” At the end of each tour, visitors were given a rock from the riverbed and a small plaque commemorating their experience.

Admittedly, it took some work to convince the contractors to allow the tours and to ensure they would be conducted safely, says Wynn Morgan, operations superintendent for Missouri American Water and the senior program engineer for the project. “We had a lot of conversations about why this was important to the project and how it would communicate value to the customer,” he says. “Once they understood that, no one said no.”

The 100-plus people who took the tour included media representatives who wrote news stories and shared online videos about the experience, spreading the word about the project across the community.

But giving tours of the river tunnel was more than a mere marketing gimmick. “Water infrastructure is usually invisible to the community,” Mr. Morgan says. “The tours showed people the value of the service and how much work it takes to get water from the river to the tap.”

The value of the tours was underscored in early 2012, when Missouri American Water had to defend the rate increase to regulators. “We were thrilled to find there was almost no opposition from the community,” Ms. Dettmer says.

And five months later, when Missouri faced a massive drought, Jefferson City was one of the few communities in the state that did not have to mandate water restrictions thanks to the new infrastructure.

“A lot of people congratulated us for finishing the project before the drought happened,” Ms. Dettmer says. “They understood how doing that project was essential to the health of our community.”

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PHOTO COURTESY OF MISSOURI AMERICAN WATER

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“The tours showed people the value of the service and how much work it takes to get water from the river to the tap.”

—Wynn Morgan, Missouri American Water, St. Louis County, Missouri, USA

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CASE STUDY 2

Crossing Borders

Creative funding and grassroots meetings help build support for a US$2 billion bridge connecting Canada and the United States.

When the Detroit River International Bridge Crossing is finally completed, no one will walk away without having the chance to share his or her thoughts.

Over the past seven years, the team has held more than 300 public meetings and completed dozens of detailed environmental assessments to validate that the design and placement of the bridge spanning the Detroit River align with the wishes of citizens on both sides of the U.S.-Canada border.

In April, the team received a key permit from the U.S. State Department, the latest hurdle for the US$2 billion project, also known as the New International Trade Crossing, that links Windsor, Ontario, Canada and Detroit, Michigan, USA.

“It's been a long process,” says Marc Brazeau, from Transport Canada, a government department based in Ottawa, Ontario, Canada. But thanks to aggressive efforts to engage the community, the project is supported strongly by citizens on both sides of the river.

IN YOUR BACKYARD

The project began with conducting environmental assessments in Windsor and Detroit, which informed the selection of the bridge location, says Mark Butler, senior communications adviser for Transport Canada. The bridge team began the project with 15 potential river-crossing locations, as well as various options for the Canadian connecting roads. Then, following a detailed technical analysis of each alternative, the team narrowed the list based on various factors, including cost, regional mobility and, most importantly, community support.

The team agreed from the outset that it wouldn't push to build the bridge in a town where it wasn't wanted. “If the community was against having an international crossing in their neighborhood, we took that option off the table,” Mr. Butler says.

Community members in Windsor and the Del Ray neighborhood in Detroit endorsed the project because of the jobs and economic prosperity it promised. Also, Michigan will explore job-training opportunities in the local project area.

“We had to look well beyond the government level to interact at a grassroots level,” Mr. Brazeau says. “This bridge is going to land in two communities, and we needed to be sure their concerns were met.”

PICKING UP THE TAB

Getting local approval was only the first piece of the public stakeholder puzzle; the project team next had to figure out who would pay for what. Michigan was one of the hardest-hit U.S. states during the recession, which meant the project owners needed to think creatively about where the funds would come from, Mr. Butler says.

The team worked closely with dozens of official stakeholders on both sides of the river, including provincial, state and federal government groups in Canada and the United States, private organizations, chambers of commerce, and local taxpayer groups to figure out how to finance the massive infrastructure project.

Ultimately, Canada agreed to take on most of the cost, covering interstate connections, the bridge itself and, through a public-private partnership, the construction, operation, and maintenance of the plazas and border-crossing posts. As such, Michigan will not be providing any funding for the project now or in the future.

In exchange for funding the project, Canada will recoup its investment from tolls.

“This crossing is extremely important to Canada,” says Mr. Brazeau, of the reasoning behind the unbalanced funding scheme. The United States is Canada's top trading partner, and 30 percent of that trade—or CAD$125 billion worth of goods—will cross the bridge annually once it's complete. “The Canadian people are very receptive to the project, and we know we will recoup the money over the long term through tolling,” he says.

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WAITING ANXIOUSLY

The project team has nearly finished purchasing the necessary land on the Canadian side, and now that the U.S. permit has come through the team will do the same in Michigan. If all goes well, Mr. Brazeau hopes to begin the proposal process in late 2014, with the goal of opening the bridge in 2021.

“It's taken a lot of time and a lot of creativity to get this far,” he says. But thanks to good communication with the public and strong champions on both sides of the border, he's confident the project will be a success.

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IMAGES COURTESY OF MICHIGAN DEPARTMENT OF TRANSPORTATION AND TRANSPORT CANADA

CASE STUDY 3

The Mighty Few

A Swiss agency finds that accommodating citizen demands costs less than fighting back.

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PHOTO COURTESY OF HERENKNECHT AG

The original construction plan for the Gotthard Tunnel united residents of Uri, Switzerland against the project.

On grand infrastructure projects, even a small community can raise a big stink. Uri, a canton of 35,000 people in central Switzerland, made its displeasure known about the Gotthard Tunnel project, a US$10 billion, 57-kilometer (35-mile) railway tunnel currently being drilled under the Swiss Alps to ease traffic and promote trade in the region.

“Nationally, everyone is convinced of the importance of this tunnel,” says Gregor Saladin, spokesperson for Switzerland's Federal Office of Transport (FOT) in Bern. “But we did face strong local opposition from the community in Uri.”

THE SWISS WAY

The initial project plan called for the north end of the tunnel to emerge from the mountains and cross Uri via a tall dam. “It would have been like building the Berlin Wall in their valley,” Mr. Saladin says.

The community's residents were upset and became vocal opponents, threatening to halt the project rather than allow the dam to be built.

Instead of fighting them, the FOT decided early on to address their concerns. The project team took the designs back to the drawing board and reconfigured the tunnel, making it longer and putting the tracks running through Uri closer to the ground. The FOT also agreed to have more trains make stops in the town, Mr. Saladin says. To appease the Uri community's long-term concerns, the project team added a rail crossing—or bifurcation—midway through the tunnel, enabling the set of tracks planned for the second phase to run on another route and bypass Uri altogether.

All told, accommodating the state added CHF2 billion to the cost of the project, including CHF100 million for the bifurcation initiative alone, which won't be used until the second tunnel is built decades from now.

But it was worth it, Mr. Saladin says.

“The Uri people were very committed, and they would have fought us to the highest court in Switzerland,” he says. Not only would that have caused at least two years of construction delays and led to substantial court costs, the project team wasn't even convinced it would win the battle. “We might have fought for two years and lost anyway,” Mr. Saladin says.

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In Germany, for example, the Stuttgart 21 rail tunnel project has faced a stream of delays due to disputes by citizens over the cost and design of the tunnel.

“The German government didn't want to change the project plan, and as a result it's been blocked for years,” Mr. Saladin says. “In Switzerland, we have found that, in the end, it costs less when you compromise.” PM

Land of the Free, Home of the Unpaved

The United States received a harsh wakeup call in March, when the American Society of Civil Engineers (ASCE) gave the nation's infrastructure a “D+” grade. Remarkably, that's an improvement over previous report cards, which the ASCE issues every four years.

The report estimates the country needs US$3.6 trillion in infrastructure upgrades by 2020 and that, by that time, aging infrastructure will cost the average U.S. family US$28,000 in income.

It's no coincidence that President Barack Obama's proposed 2014 budget allocates US$50 billion for infrastructure investments. The bulk is targeted at so-called “Fix-It-First” projects: roads, highways and bridges in need of immediate repair. The budget also provides US$10 billion for programs that foster innovative solutions for high-value infrastructure projects.

But the budget would reduce spending on some infrastructure programs, such as wastewater and drinking-water system improvements. Both categories received a “D” from the ASCE.

The ASCE cited several modest improvements made in recent years, including:

  • Greater private investments for connectivity and efficiency improved rail infrastructure.
  • Increased bridge-repair efforts at the state and city levels turned around some of the most vulnerable structures.
  • several categories improved due to short-term injections of federal funds.

“We know that investing in infrastructure is essential to support healthy, vibrant communities. Infrastructure is also critical for long-term economic growth, increasing GDP, employment, household income and exports,” the report stated. “The reverse is also true—without prioritizing our nation's infrastructure needs, deteriorating conditions can become a drag on the economy.”

This material has been reproduced with the permission of the copyright owner. Unauthorized reproduction of this material is strictly prohibited. For permission to reproduce this material, please contact PMI.

PM NETWORK JULY 2013 WWW.PMI.ORG

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