A conceptual framework for implementing programs to program completion

reviewing the PFI

Mr. Simon Mills
Redevelopment & Regeneration Project Office,
Whipps Cross University Hospital NHS Trust

Mr. Zafeiris K. Petalas
Center of Environmental Research,
Brunel University

Dr. Alan Edwin Serrano Rico
Department of Information Systems and Computing,
Brunel University

Proceedings of the PMI Research Conference
11-14 July 2004 – London, UK

 

Abstract

Many projects of a large and complex scale are being procured in the National Health Service (NHS) under the Private Finance Initiative (PFI) procurement model. The presence of multi–project environments adds to the complexity of such schemes. Existing practices in the public sector exhibit a lack of integration between project delivery and the organizational strategy. An additional problem in this relatively new domain of Public Private Partnership projects is the lack of a standardized methodology for sustaining a successful program throughout its life cycle, for the management of multiple major complex and dynamic project environments differing in size, required skills, and urgency. The aim of this paper is to introduce the problematic area of program management in PFI Schemes, provide a short review of current practices, and present the thinking behind the development of a framework for the implementation of programs to program completion run by a Program Management Office (PMO) set up to “maintain a single proven project management methodology across the organization and to provide a knowledge network that will drive commonality by providing methodology, tools, processes and standards, to facilitate clearer communication and better collaboration within projects and across programs and organizations along” and better integration of project and change management practices.

Keywords: Public Private Partnerships, Project Management Offices, Program Management, Private Finance Initiative, Program Management Framework

 

1. Introduction

1.1 PFI and Public Private Partnerships

The Private Finance Initiative (PFI) is a United Kingdom (UK) government initiative for utilizing private finance and management expertise and injecting these traits into the provision and operation of public sector services (For-shaw, 1999). PFI is one form of Public Private Partnerships (PPP) used in public sector infrastructure projects and is fast becoming one of the UK Government's main instruments for delivering public services. One of the primary underlying reasons why this is the case is the public sector procurement failing to meet set objectives, soaring construction costs, elevating time overruns, and operational inefficiencies credited to poor design issues. In their report to the IPPR Commission on “Making Public Private Partnerships Healthier”, Whittlestone and Kelly (2000) identified the following alternative future investment models of Public Private Partnerships:

  • Service-Improvement linked: Tailored to and directly linked with investments to the delivery of improved public sector infrastructure services, leading to the bettering of focused priorities and the promotion of greater efficiency in the targeted use of resources.
  • Whole Systems: Diversified investment across the relevant public service provision will both hedge risk and help to link the planning assumptions athwart all pertinent sectors.
  • Front-loaded: Ideally suited to provide the up-front funding, which would enable new facilities to be in place and new systems operational before the old are dismantled.
  • Store and forward: In this case, PPP's could tailor the quantity and timing of future investment to match changing needs
  • Service-based: The improvement of existing, and development of new, well-thought frameworks offer the opportunity to align Public Private Partnerships with fastidious services.

The Private Finance Initiative is an initiative for improving the quality and cost-effectiveness of public services. It attempts to address any issues that inundated the traditional system of procurement, thereby aiming to make it more efficient in comparison to the traditional procurement cycle. Mott McDonald (2002) provided an illustrative comparison of the life cycle of a capital project procured traditionally and under the private finance initiative. This is depicted in Exhibit 1.

Traditional and PFI Procurement

Exhibit 1: Traditional and PFI Procurement

All major PFI schemes are typically DBFO (design, build, finance and operate) and by taking on the role of the Private Sector Partner, the Private Consortium becomes accountable for designing the facilities, building them, financing the capital cost and finally operating the end-product. Hence it becomes a priority private as well as the public sector to develop schemes that are “value for money.”

The UK Treasury Task Force commissioned Arthur Andersen and Enterprise LSE Ltd. to carry out a study on the “Value For Money” drivers in schemes procured under the PFI procurement process. The six key drivers identified by Arthur Andersen and Enterprise LSE (2000) included risk transfer, the long-term nature of a PFI contract (including whole life costing), the use of an output-based specification, competition, performance measurement incentives, and management skills. It is obligatory for all PFI schemes to demonstrate “Value for Money (VFM)” prior to acquiring government approval. However, in order to demonstrate “value for money,” the private sector partner must assume the risks. Then they can be considered more cost-effectively run by them than the public sector partner would otherwise be obligated to bear. To ascertain whether or not this has been attained, it is necessary for the public sector partner to carry out the “Public Sector Comparator” exercise prior to the contract being awarded to the preferred private sector partner, and updating regularly following the award and throughout the entire contract period.

1.2 The PFI Procurement Process

The NHS Executive in its Good Practice Guide provides a more complete view of the PFI procurement process (depicted in Exhibit 2) in the NHS, subsequently simplifying the PFI procurement process into 9 steps:

  1. Commissioning of case for change by the relevant organization and commissioner;
  2. Development of Strategic Outline Case (SOC) for Capital Prioritization Advisory Group (CPAG) major schemes;
  3. Development of Outline Business Case (OBC) and preparation for procurement;
  4. OJEC notice;
  5. Pre-qualify candidates and issue ITN;
  6. Evaluation and selection of preferred bidder;
  7. Development of Full Business Case (FBC);
  8. Finalize ideal;
  9. Award contract.
The NHS PFI Procurement Process

Exhibit 2: The NHS PFI Procurement Process

1.2.1 Review of PFI Procurement

To date, the British Government has commissioned two reviews of the PFI Procurement process: the “Gershon Review” and the “Bates Review.” Gershon (1999) identified a number of weaknesses in Government procurement, which, if dealt with appropriately, could prove to deliver efficiency savings to the value of £1 bl/annum in public-sector procurement. The report proposed the creation of a central body to ensure consistency of strategy, promotion of best practice, and appropriate aggregation known today as the Office of Government Commerce (OGC). The OGC was created out of the amalgamation of the Buying Agency, CCTA, PACE, the Treasury Procurement Group, and the continuing PFI Taskforce. A second identified shortfall was the absence of a common process across Government for the management of large, complex, or novel projects (Gershon, 1999). Gershon recommended a process that would identify distinct phases in the life of a project and between these phases there would be “gates” characterized by a set of deliverables. The project would only be able to progress onto the next stage in the event that it satisfactorily passed an independent review, the Office of Government Commerce's “Gateway Review Process.”

Since the first “Bates Review” (Bates, 1997), progress in the area of PFI/PPP's has been dramatic. The creation of a more streamlined and simplified approach has increased the flow of good PFI projects. The main shortfalls identified in this review included a lack of public sector contract negotiation and project management skills. Gershon (1999) examined the progress made by the Government in the delivery of PFI/PPP's. The report covers the whole breath of PFI/PPP's and includes the recommendations for improving a department's resources. The main areas of concern and weakness include: strategic planning, project management, negotiation skills, financial disciplines, and management of long-term contracts. Following the second review, a new public private partnership was to be created which would work with the public and private sectors to address the key weaknesses in the PFI/PPP process.

The PFI Project Delivery Experience

Exhibit 3: The PFI Project Delivery Experience

Following the National Audit Office (NAO) census of thirty-seven PFI schemes in the report, “PFI: Construction Performance Session” (2003), the results indicated improved performance and greater certainty in delivering schemes under the PFI procurement process. Twenty-eight of the schemes were delivered on time or earlier than specified in the contract. The NAO stated that the results provided evidence of the PFI approach bringing significant benefits to central government, in terms of delivering assets built on time and for the price expected by the public sector. Exhibit 3, from the same report, provides a more complete view of the PFI procurement process in the National Health Service.

1.2.2 Need for Improvement: The Case for Change

Public sector organizations are seeking ways to maximize the effectiveness and value of their program management operations. In order for this to be achieved, it is necessary to improve the alignment of programs and organizational objectives along with performance monitoring at both the program and project level. It is also necessary to carry out a top-down review of the approval and management processes used to deliver PFI schemes, as the potential for improvement in the management of these multiple project-environment schemes is significant. It is estimated that up to 90%, by value, of all projects are carried out in the multi-project context, and thus the impact of even a small improvement in their management of the project management field could be enormous. This could be achieved by reviewing the program's critical success factors (OGC Toolkit, 2004), which are listed in Exhibit 4.

A program's critical success factors

Exhibit 4: A program's critical success factors

While government intent is sincere and OGC guidance is good, the skills, processes, and culture needed to enable the delivery are lacking. EURIM (2002) identifies an essential need for radical changes in the management and procurement of delivery programs so as to enable the delivery of successful schemes. The same report also highlights that, although a general agreement exists as to how change should be managed, this is not being achieved at the operational level, thereby leaving the program vulnerable to costly outcomes.

1.3 Gateway Review Process

OGC-BP (2004) defines a project as “a particular way of managing activities to deliver specific products over a specified period of time and within defined cost and resource constraints” and a program as “a management framework for co-ordinating related projects and work streams to deliver strategic outcomes and benefits over time scales that are often less well defined.” As part of this overall aim to improve the management of major investment and capital programs, the Office of Government Commerce developed the Gateway Review Process. Exhibit 5 (OGC-BP, 2004) provides an overview of the process.

There are five OGC Gateway Reviews during the life cycle of a project, three before contract award and two looking at service implementation and confirmation of the operational benefits (OGC-BP). A project is reviewed at the OGC Gateway Review appropriate to the point reached in its life cycle. There may be additional OGC Gateway Reviews if required, such as the decision points between OGC Gateway Reviews 3 and 4 for construction projects. The process emphasizes early review for maximum added value. Gateway Review 0, the strategic assessment, is designed to apply at the start of a program and may be repeated at subsequent key decision points. OGC Gateway Review 0 confirms that the appropriate project structure is in place and that interdependencies have been recognized. OGC Gateway Reviews 1 to 5 apply to each of the procurement projects within the program. A repeat OGC Gateway Review 0 later in the life of a program can be helpful in re-visiting and confirming the business case, the management of the program risks, and interactions between the projects and the delivery of benefits for the program as a whole (OGC-BP, 2000). The “strategic-assessment”’ stage is a program-only review that is repeated throughout the program's life; it can be applied to policy implementation, business change, or other types of delivery programs involving acquisition, and sets the program review in the wider policy or corporate context.

The gateway review process

Exhibit 5: The gateway review process

The OGC Gateway Process provides assurance and support for Senior Responsible Owners (SRO) in discharging their responsibilities to achieve their business aims by ensuring that:

  • The best available skills and experience are deployed on the program or project;
  • All the stakeholders covered by the program/project fully understand the program/project status and the issues involved;
  • There is assurance that the program/project can progress successfully to the next stage of development or implementation;
  • More realistic time and cost targets are achieved for programs and projects;
  • Knowledge and skills among government staff are improved through participation in review teams;
  • Advice and guidance to program and project teams are provided by fellow practitioners.

1.4 Previous Research

Payne (1995) carried out a state-of-the-art review on the management of multiple simultaneous projects and showed that there was potential for significant improvement in the management of such programs. A small improvement can potentially provide enormous financial savings (i.e., capital costs, project team costs, and— depending upon the effectiveness of processes—post-implementation revenue cost and unexpected overrun costs). Benefits can also be achieved in non-financial/non-cost-driven areas (i.e., facilities management to the client; value for money; potential to facilitate a clearer client and contractor understanding of goals and objectives; provision of solid foundations for audit-trails and reduction of idle resources). The information collated by Payne was subsequently classified into five categories (the five C's):

  • Capacity, referring to the ability of the organization carrying out multi-projects to provide sufficient and appropriate resources;
  • Complexity; referring to those aspects concerned with the multiple interfaces between the projects, the project and the organization, the parties concerned, etc.
  • Conflict, arising from potentially unstable relationships in multi-project environments;
  • Commitment, referring to the commitment to individual projects of the parties working on, or providing resources to, the projects;
  • Context; referring to the setting of projects, such as culture, procedures and norms of behavior, including people issues, systems issues, and organization issues.

Previous research work (Thiry, 2003) has repeatedly demonstrated the need to adopt an alternative approach for managing successful programs. The Central Computer and Telecommunications Agency (CCTA) published a guide on “Managing Successful Programs” (MSP, 1999), in which it states that the two key characteristics, for the successful management of a program plan to program completion, are: cyclic processes and the interdependability of projects. Cyclic processes provide the ability to carry out options and benefits appraisals at regular intervals, thus succeeding in pacing processes, while the interdependability of projects can ensure their strategic alignment (MSP, 1999).

1.5 Managing Successful Programs (MSP)

OGC defines program management as a structured framework for implementing business strategies and initiatives through the coordinated management of a portfolio of projects that change organizations to achieve benefits that are of strategic importance.

The OGC has published extensive work on programs and project management. The problem with MSP is that it that it lacks a certain level of maturity in the user community that is beyond the capability of many departments. EURIM (2002) identifies a need for a comprehensible practical program approach that can be rolled out and adopted across all government programs. While the application of program management is recognized as being essential, it is not embedded within the operations of the actual departments. Subsequently, actions are not consistently benefits-driven, decisions not being taken or made quickly enough, and the desired outcomes not realized in the desired time scales. Managing Successful Programmes (OGC, 1999) is a guide developed for the UK Government, which describes how to identify the vision statement for the program. This vision may be to deliver a new service, to perform the same service but in a more efficient way, or simply to better the competition (MSP, 1999). Exhibit 6 (ORIEL, 2003) provides an overview of the MSP Program Management Environment, life cycle, and processes.

The MSP Program Management Environment and Processes

Exhibit 6: The MSP Program Management Environment and Processes

2. Program Management Issues

A common definition for a program is “a collection of projects related to some extent to a common objective” (APM, 2003). Although no specific definition for program management is defined, it is stated that it may cover managing any or all of the following:

  • A portfolio of projects related to some common objective;
  • The business strategy of the organization which is to be implemented through projects;
  • The interdependencies between a number of projects;
  • Resource allocation among a portfolio of projects;

The Central Computer and Telecommunications Agency (CCTA) guide on Managing Successful Programmes (MSP) (CCTA, 1999) identified two key characteristics of successful program management: cyclic processes and interdependability of projects. Cyclic processes provide the ability to carry out benefits appraisals at regular intervals, while the interdependability of projects ensures their strategic alignment.

2.1 Goals of Program Management

The Program Management Association (PMA) defines program management as “the implementation of strategy through consolidated programs of projects.” Exhibit 7 tables the goals of program management as identified by Strange (2000).

Program Management Goals

Exhibit 7: Program Management Goals

Pellegrini (1997) showed that programs existed to create value by improving the management of projects in isolation and thereby creating benefits through better organization of these projects. However, as Lycett, Rassau, and Dan-son's previous research work (2003) has proven, programs do not in themselves deliver individual project objectives. Lycett et al. categorize the goals of program management into:

  • Efficiency and effectiveness: those goals referring to aspects of management that a proficient manager should address; that is, improved coordination and dependency management, more efficient resource utilization, and effective knowledge transfer;
  • Business focus goals: those achieved through the external alignment of projects with the requirements, goals, drivers, and culture of the organization; that is, more coherent communication, improved project definition, and better alignment with business drivers, goals, and strategies;

Ahmad, Azhar, and Ahmed (2002) defined the construction industry as a multi-organizational process that is heavily dependent on that exchange of large and complex data. Similarly, the successful completion of a program depends on the accuracy, effectiveness, and exchange of critical information and data between the members of the program management team and all associated parties. The need for effective information processing and exchange increases with the degree of task uncertainty, the number of organizational units involved, and the extent of interdependence among the units.

2.2 Program Management and Program Support Offices

The provision of effective project support is a difficult task requiring the integration of soft and hardcore program and project management skills. Program Management Offices (PMO) are responsible for the business and technical management of a specific contract or program. However, without the existence of Program Support Offices (PSO), there would be a lack of assigned responsibility for the administrative support of the programs. The establishment of a PSO is a requirement under the OGC Toolkit to assist with the management and distribution of program information such as budget control, status reports, and other program documentation.

Kwak and Xiao (2000) carried out research on the value of project management offices in which they identified that their true value is not always well received or well respected across an organization. Similarly to the way that Dai (2000) identified the features, services, and functions of a project management office, the end product of the proposed framework will act as the operational manual of the respective roles in the program management environment:

  • Developing and maintaining program management standards and methods;
  • Developing and maintaining program historical archives;
  • Assuming program administrative tasks;
  • Human resource/staffing assistance;
  • Program management consulting and mentoring;
  • Providing and arranging program management training.

The development of the proposed framework for the implementation of a PFI program plan through to its completion will also establish an audit trail of the program's life cycle. Run by the PMO and set up to maintain a standardized program execution plan, the framework will increase the potential for the successful delivery of the organization's strategic objectives. Exhibit 8 provides an illustration of the PMO's environment and delivery responsibilities.

PMO Environment and Responsibilities

Exhibit 8: PMO Environment and Responsibilities

The Treasury's Technical Note on the management of the delivery of long-term PFI schemes defines successful PFI programs as those delivering value for money in the form of cost-effective, reliable, and timely services at agreed-upon prices and to agreed-upon quality; consistent with legal standards, financial probity, and management accountability; while maintaining good client/supplier relationships (Treasury Note 6, 2000). The implementation, monitoring, and continuous review of the proposed framework will be carried out by a PMO, and is expected to assist PFI programs in delivering “value for money” services.

The standardization of the processes used in the organization's blueprint, as defined by Strange (2000), can achieve a higher level of consistency to application and results, while control resource allocation should increase efficiency, reduce duplicative work, and—potentially—achieve a reduction in costs (PM Knowledge Wire, 2002). The PMO is ultimately responsible for ensuring the development and implementation of risk mitigation action plans, the improvement of risk management, and contingency planning throughout the organization, while providing implementation and benefits realization plans that will act as a road map to the successful delivery of the organization's objectives.

2.3 The Program Life Cycle

The OGC Best Practice Guide covers a number of issues throughout the program management lifecycle. At the “Drivers for Change” stage, it requires the confirmation of the business need and the stakeholder support, a plan for communications, confirmation of the program management arrangements, a plan for risk management and benefits management, financial authorization, confirmation of the scope, and review requirements for successful change.

When identifying the program, it is necessary to set up the program authority groups, produce the defining documents and decide whether or not to proceed to the program definition stage. At this stage, the Successful Delivery Toolkit (SDT) advises the establishment of the team defining the program, development of the program's vision and plan, and finally the development of the management plans (i.e., Risk Management Strategy, Benefits Management Strategy, Quality Management Strategy, etc.) To establish the programme, it is necessary to set up the organization and people-related elements of the program, set up government arrangements, establish the benefits measurement processes, set up Information Technology (IT)/tools support and finally establish the communications channels required to be in place, enabling the successful delivery of the program objectives. Exhibit 9 depicts the program management life cycle and its processes as defined by the OGC's Successful Delivery Toolkit (OGC Toolkit).

Program Management Processes

Exhibit 9: Program Management Processes

At the “Running the Program” stage, the SDT requires clarity in the management of the portfolio, the identification of the projects necessary for the delivery of the business benefits, the refinement of the program plan, the approval of the project brief, the required project monitoring procedures to be in place, the development of the transition plan, and the establishment of the benefits management plan.

When the program reaches the closing stage, it is necessary to confirm program closure, carry out benefit review, update and finalize documentation, disband program management and support functions, and inform stakeholders of the closure. While carrying out the program benefits review, it is necessary to measure the levels of benefits achievements and carry out the Gateway Review so as to establish the benefits achieved.

3. Research Methodology

Many organizations have developed or are in the process of developing efficient mechanisms for controlling and reporting day-to-day operations and managing the production side of the business with managing information systems (MIS) techniques and other reporting tools. Previous research work by Thiry (2003) has previously demonstrated the need to adopt an alternative approach for managing successful programs. Strange (1997) acknowledged a number of key items that identify the most important early requirements in the development of the program management cycle. Depicted in Exhibit 10, these processes will form the minimum requirements and the primary areas of acknowledgment for the proposed framework in aid of the PFI program delivery process.

The initial aim of the research project was to carry out a comprehensive review of the literature available regarding the delivery of a successful PFI program. The identification of the program's critical success factors within the inter-lock of the future business blueprint as defined by Strange are depicted in Exhibit 11.

Requirements for the Development of a Program Management Life Cycle

Exhibit 10: Requirements for the Development of a Program Management Life Cycle

Interlock of Future Business Blueprint

Exhibit 11: Interlock of Future Business Blueprint

The framework proposed in this paper, depicted in Exhibit 12, has emerged from the lack of a standardized model for implementing programs to program completion and the level of complexity in PFI schemes. The research carried out forms part of the author's work on the 4th Wave PFI Scheme at Whipps Cross University Hospital NHS Trust. The methodology adopted to carry out this research will initially aim to prove that the development of such a model will benefit construction-project management by aiding the management and organization of the construction process, widely the major determinants of project performance.

The performance of the proposed framework is to be tested and evaluated using the program management maturity questionnaire developed by Rayner and Reiss (2000), and a six-month gestation/testing period will be permitted to enable a more complete review of the proposed model's performance.

Program Management Framework

Exhibit 12: Program Management Framework

The culture of a large organization differs dramatically from that of a smaller one, and yet with it carries a stable culture. In contradiction to this, a Public Private Partnership (PPP) project tends to be governed by a project organization of a rather complex matrix form. One of the complexities that arises within a PPP project environment stems from the dedicated hierarchical organization structure usually associated with large public sector projects. This case study stems from the National Health Service and is based on the author's work on the delivery of the PFI Program at Whipps Cross

University Hospital NHS Trust. It spells out the approach adopted by the Trust to enable the alignment of strategic objectives and project outputs and deliverables. The aims of the scheme include the major redevelopment of Whipps Cross University Hospital involving the re-planning and rebuilding of the existing hospital site, enabling the modernization of NHS services and the fostering of local regeneration in this relatively deprived part of northeast London.

3.1 Research Hypothesis and Challenges

The author aims to address the lack of a standardized methodology for sustaining a successful plan to project completion of the management of construction projects within the National Health Service (NHS) Private Finance Initiative (PFI) procurement process, and propose the development of an alternative method of implementing and managing a successful program plan through to its delivery completion. It will aim to bring in line and on the same frequency the project team members, sponsors, stakeholders, and ultimately the public and all contractors. The major challenges in developing this plan for delivering successful programs will be to:

  1. Structure the theories that form the backbone of the model;
  2. Develop the model and the framework that will permit their explanation;
  3. Set paths for the developments in management practice that may be expected to appear as a result of these theories, while taking into consideration the sensitivities that lie within the National Health Service and the Private Finance Initiative (PFI) Procurement Process;

The developed model will produce an operational document for the management of the project. It is a statement of policies and procedures defined by the project director, although usually developed by the project manager for the project sponsor/project director's approval. It sets out in a structured format the project scope, objectives, and relative priorities.

The research effort, carried out for the purposes of this report, attempts to provide the logic behind the development and implementation of a standardized program execution plan by demonstrating the value of a formal and structured program execution plan to the PMO, the public, and the private partners involved in the PFI Procurement process; by reviewing existing program management practices and standards associated with the delivery of the PFI procurement process; and identifying the Key Performance Indicators (KPI's) and Critical Success Factors (CSF's) affecting project delivery throughout the life cycle of a PFI construction program.

The Program Execution Plan is to be developed for the needs of the Whipps Cross University Hospital NHS Trust Redevelopment and Regeneration scheme and tested over a six-month period across the organization.

3.2 Current State of the Research

The research project being carried out commenced in January 2002 at the Centre for Environmental Research (CER) at Brunel University, West London. The author obtained a research scholarship from Whipps Cross University Hospital NHS Trust to carry out research on setting up PMO's and developing a model for sustaining a successful plan to project completion. Depending upon the effectiveness of this model, it could then potentially be used when undertaking any PFI scheme within the National Health Service (NHS). The doctorate research is organized in seven chapters. The first chapter sets the scene for the thesis or is a road map to it, while Chapter Seven concludes the thesis by reminding the reader of where they have been. Chapters Two through Six are the research content of the doctorate research project. The project is expected to be completed by February 2005.

The preliminary indicative results of the authors’ research work to date has shown that the implementation of such a framework can potentially lead to a number of significant benefits to the profession arising from many factors including:

  1. Improvements in resource utilization and efficiency;
  2. Reduction in administrative overheads;
  3. Improved time management performance;
  4. Standardization of a large proportion of the work leading to time and cost reductions;
  5. Reduction in potential for project risk of failure;
  6. Increased staff morale and motivation;

4. Conclusions

We live in a predominantly business–like world, where, unlike in Aesop's fables, the hare always beats the turtle. Organizations are constantly in the process of finding ways to improve the efficiency of their operations. This research project focuses on the methodologies, tools, processes, and standards required to facilitate clearer communication and better collaboration within a program and across projects and multi-disciplinary departments.

Having a project up and running on time and within budget necessitates the establishment of a Project Management Office (PMO). Projects can be successfully managed and delivered without the presence of a PMO, but such a presence will undoubtedly increase the probability of success. The aim of the PMO is to maintain a single proven project management methodology across the organization and to provide a knowledge network that will drive commonality by providing methodology, tools, processes, and standards to facilitate clearer communication and better collaboration within projects and across programs and organizations.

This literature provides the vision and logic behind the development of the framework for managing problem areas such as inadequate project level activities, lack of resource availability competency and methods, lack of commitment, unclear roles and responsibilities, inadequate portfolio level activities, lack of information management, and management of project-oriented organizations. The authors’ investigative research work on program management to date has involved the relatively new domain of Public Private Partnership schemes and is designed to overcome the lack of a standardized framework for sustaining a successful program to program completion. The results to be obtained apply to the management of multiple projects, which may or may not differ in size, required skills, and urgency. Data has been obtained on a £ 323 million National Health Service (NHS) 4th wave PFI project, and the results of this study provide a rationale to develop a conceptual model for the implementation of program plans to program completion, and point to further research being undertaken by the authors to design and implement such a model. The establishment of a Program Management Office responsible for developing and maintaining this single proven methodology across the organization and providing a knowledge network that will drive commonality through the development and implementation of the respective methodology, tools, processes, and standards to facilitate clearer communication and better collaboration within projects and across programs and organizations.

5. Further Research

The fully-developed version of the framework, along with the results of the sensitivity analysis (i.e., the way that the projected program performance will vary in line with the changes in the key assumptions on which those projections are based) and an investigation of the effectiveness of this framework for managing the life cycle of a successful program, will be presented in November 2004, as partial fulfillment of a doctoral research project on program management in public private partnerships.

The development of the proposed program management framework will subsequently lead to the production of a core operational document, clearly defining the processes required to be in place for the management of any project along with a statement of policies and procedures defined by the project owner, although usually developed by the project manager for the project sponsor/project director's approval. It will set out in a structured format the project scope, objectives, and relative priorities (OGC Toolkit, 2003). The research effort currently underway presents an alternative option to managing multi-project environments by providing a standardized conceptual framework; reviewing current practices and existing standards within the PFI market; and identifying the Key Performance Indicators (KPI's) and Critical Success Factors (CSF's) affecting project delivery throughout the lifecycle of a PFI construction program. The standardized Program Execution Model (PEM) developed will also demonstrate the value of this formal and structured PEM, on the one hand to the Project Management Office (PMO) and on the other to both the public and private partners involved in the PFI Procurement process.

Ahmad et al. (2002) defined the construction industry as a multi-organizational process that is heavily dependent on exchange of large and complex data. Successful completion of a project depends on the accuracy, effectiveness, and exchange of critical information and data between the project teams. The need for effective information processing and exchange increases with the degree of task uncertainty, number of organizational units involved, and the extent of interdependence among the units (Ahmad et al., 2002). The main parameters that require investigation, allowing and enabling the successful evaluation of the effectiveness of the actual model, will include items such as its robustness, the balance achieved within it, the levels of coherence achieved, and the way in which it will correspond with business goals and values.

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Strange, G. (2003) Linking Strategy to Programme Management. APM SIG in Programme Management, The Programme Management Website, http://www.e-programme.com/articles/linkingstrategy.htm.

Strange, G. (1998) Understanding Program Management, APM SIG in Programme Management, The Programme Management Website, http://www.e-programme.com/articles/understand_pm.htm.

Technical Note No.6, How to Manage the Delivery of Long Term PFI Contracts, Private Finance, Treasury Taskforce

Thiry, M. (2003) “For DAD”: a program management life cycle process. International Journal of Project Management,

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Author Contact Information

  1. Professor Susan M Grimes
    Head of Centre
    Brunel University
    Centre for Environmental Research
    Uxbridge UB8-3PH
    Middlesex, UK
    Tel: +44-(0) 1895 274000
    Fax: +44-(0) 1895 203350
    Susan.Grimes@brunel.ac.uk
  2. Simon Mills
    Director for the PFI Redevelopment Scheme
    Whipps Cross University Hospital NHS Trust.
    Redevelopment and Regeneration Project Office
    Whipps Cross Rd
    Leytonstone, E11-1NR
    London, UK
    Tel: +44-(0) 208 5395522 # 5368
    Fax: +44-(0) 208 5356944
    Simon.Mills@bwhippsx..nhs..uk
  3. Zafeiris K. Petalas
    PhD Researcher on Programme Management for PFI
    Whipps Cross University Hospital NHS Trust
    Redevelopment and Regeneration Project Office
    Whipps Cross Rd
    Leytonstone, E11-1NR
    London, UK
    Tel: +44-(0) 7734 175059
    Fax: +44-(0) 208 5356944
    Zafeiris.Petalas@brunel.ac.uk
  4. Dr. Alan Edwin Serrano-Rico
    Lecturer
    Brunel University
    Department of Information Systems and Computing (DISC)
    Uxbridge UB8-3PH
    Middlesex, UK
    Tel: +44-(0) 1895 274000 #3622
    Alan.Edwin.Serrano-Rico@brunel.ac.uk
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 or any listed author.

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