In this blog, our general manager for SWG in North America, Kelly Widger, talks about her experience of working with public-private partnership (PPP) contracts over the last ten years.
PPPs can be complex matters, but with care and attention the results they produce have the potential to be exceptional.
Having been involved with PPP O & M (Operation & Maintenance) contracts across the globe, supporting them at all stages from the initial bid to providing software to keep the project within the agreed operational framework, I see time and again that in order to succeed, service providers need access to high quality, objective and accessible data on their performance. Likewise, public authorities need to know that performance criteria is being met and that the data behind it is fully auditable and transparent. We see contracts where providers are receiving deductions unnecessarily because they can’t monitor and measure what they’re doing. That’s where technology plays a huge part – there was a time when off-the-shelf software was commonly used to manage all the operational contract elements, but systems have become a lot more sophisticated, with the top end applications, such as Service Works Global’s QFM and P3rform, providing an integrated payment mechanism system to provide an extra layer of data integrity, accuracy and auditability. These work so successfully we often receive requests to retrofit a paymech into existing PPP contract systems.
A Typical Week
A typical week for me is a very diverse one – the team and I are often involved in contracts as early as the bid stage so we can spend time with the service providers and public authority to really understand their requirements. This can include anything from advising about the set-up of the help desk and what happens to the requests, to how the payment mechanism will work and how transparency will be achieved. Then we’ll spend some time creating scenarios with this information so the public authority clients can ensure the new system will be fit for purpose.
Due diligence of the contract documents is a crucial focus of our work once financial close is achieved. I’ve worked with contracts often up to 600 pages long, and so it’s an area I’m really comfortable with. We’ll pick out all the anomalies, grey areas, or elements of the agreement that require further clarification, at this stage. We’ll often find KPIs that don’t make sense, or ambiguities that add to the service provider’s risk, or clauses that need clarification or an agreement on how they’ll be operationalised. On the surface, a contract can seem reasonable but it’s only when you’ve seen so many that the potential points of conflict become apparent. In the background of a PPP contract there is a great deal of complexity that needs to be taken into account. For example, when you have a problem with plumbing: is it a service failure or an instance of unavailability? The issue may seem obscure, but the financial consequences for the provider could differ by a factor of ten – so guiding users to operate the system accurately is crucial for the sustainability of the contract.
Upcoming Technology Trends
One of the great things about being involved in multiple sectors is that we have very good visibility of the trends that are coming down the line. We’re seeing new technologies being used, and sustainability and energy issues becoming much more important. These things create new challenges – and considerable experience is required to address them. Many of the high-tech hospitals we’re working with, for example, are making far more use of technology than ever before. In Canada and North America, we’re seeing greater use of technology in the transport market, as the PPP model is increasingly adopted for road, rail and transit projects.
It’s clear we’ll increasingly see this kind of technology in less high-tech facilities such as schools, offices and other public buildings. This changes the nature of the job and makes experience even more important. All these things require effective monitoring and measuring. Even the most impressive technology has to provide value for money, otherwise it’s not worth including in the spec. Citing the example above, if you have experience of how AGVs work and how they can integrate into the portering system, then you can see how the client’s requirements can be addressed, how to monitor and measure these things in a sensible, predictable way and anticipate what the problems are going to be and ward them off in advance. Technology will continue to guide how PPP contract management software needs to operate, and the shift to more sophisticated tools and sources of advice will only gain pace.
For more information about how Service Works Global can help you with your CAFM or PPP software needs, contact us here.
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