Other writings ~

Project preparation and project management is not the same

Let me tell you why….

It is quite common in industry when the process of developing a new (infrastructure) project is initiated that one of the first appointments made is that of the project manager.  Equally common is for the project manager to be an engineer with suitable experience in the relevant field of practice (i.e. water treatment, dam construction, road construction etc.).  Yet, too often it is this very first appointment, which sets the project firmly on the path to failure from which it is difficult to escape.  The reason:  not a lack of skills and experience of the project manager or the team assembled by him (or her) but simply a lack of understanding of the broad project development process and failure to establish a suitable project development regime rather than a project management regime. Read further….

Capital inefficiency: the scourge of South Africa

Its impact may even outstrip that of corruption

Many believe that corruption is the biggest bottleneck to growth, development and poverty eradication in this country, but in my own experience there is another factor that is an even bigger constraint in this regard: capital inefficiency.  As you will see in this paper, capital inefficiency is mostly the result of poor infrastructure strategy, a failure of the project preparation function, lack of integrated planning or a lack of robust project evaluation. Read further….

Public Private Partnerships – a new paradigm is needed

A plea for better co-operation

Going back 30 years the rage in the project finance industry was public private partnerships (“PPP’s”).  PPP’s were generally credited for much of the infrastructure development in South-East Asia and was widely touted as the model that will also unlock the development of Africa.  In South-Africa, the eminence of PPP’s in the thinking at that time, is reflected in the direct mention of and provision for PPP’s in various legislation such as the Municipal Finance Management Act of 2003 (“MFMA”) as well as the establishment of the PPP unit at National Treasury.  Sadly the deals have been lacking and apart from a small number of successful transactions the deal list is unimpressive.  PPP’s seem to have fallen into disfavour in both the public sector as well as the private sector.  Yet, barely a day goes past that we do not hear a call from either government or the private sector towards joining in partnership to solve the development problems of our country and that of the continent.  What went wrong, and more importantly how can PPP’s be resurrected? Read further….

For god’s sake integrate man!

Is this what Winston Churchill would have said?

One of the key failures in the municipal environment today is the lack of integrated infrastructure planning and implementation.  This results in severe capital inefficiencies and hampers growth and development.  There are many factors contributing to this lack of integrated planning we witness: the business process in municipalities, lack of understanding of the concept of integration, poor understanding, awareness and management of various risks and simply bad advice from consultants are just a few reasons.  In most cases, these factors indicate a failure of the strategic planning - and the project preparation processes. Read further….

Stop this rubbish!

Our country can no longer afford to implement the wrong projects

In one of the papers on this site I discuss the prevalence and impact of capital inefficiencies on our country.  One of the key factors contributing to capital inefficiency is a failure of the project preparation function and specifically the way in which projects are evaluated and motivated.

Picture the scene….it is the late eighties of the 20th century.  The apartheid regime in South Africa is being severely punished through international economic sanctions.  Some of the consequences of these sanctions are that foreign direct investment has all but dried up, government expenditure as a percentage of gross domestic product is climbing steadily and international financing for the government is simply not available.  The result is a fiscus that is under severe strain and unable to finance new (infrastructure) investments.  Read further….

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