Governance and Stakeholder Management Perspectives


Western Australia (WA) Public Private Partnership (PPP) is a project that aims at building four new primary schools and four new middle schools in the period from 2017 to 2023. A program of such a high level is expected to have a highly efficient governance system in place in order to maintain the adequate progression of construction and maintenance of educational facilities. According to the Office of the Auditor General, the governance system consists of a steering committee, which provides strategic leadership and a project control group, which gives appropriate directions. The representatives of DoE, Strategic Projects and EduWest meet to discuss complaints, additional work, HR questions, and health and safety issues. In summary, it may be stated that the governance system is successful in ensuring efficient communication between all the parties of the project, which is crucial for the success of the program.

Identified Problems

However, despite the high level of organization, there are some issues that prevent the project from following the identified schedule of delivery. An audit performed in 2018 revealed that there was no adequate contract management system. Even though there were two staff members dedicated to contract management, there was no established contract management plan and audit or inspection program. These problems are a sign of an ill governance system, which may lead to significant control issues and financial implications. Additionally, the project lacks an adequate information management system, which is vital for effective decision-making processes. For instance, there is no reliable cost information which leads to confusion and distrust from some of the stakeholders. In brief, the governance system of the program has two identified issues, which are to be addressed to ensure the best outcomes.

The issues in the governance system led to problems with opening schools. First, EduWest failed to recruit enough trained gardening personnel due to the lack of a transparent information management system. Second, some furniture had to be replaced because EduWest did not coordinate with the principal of the school due to poor program communications. Third, contract management staff was hired too late. Finally, the HR management suffered because EduWest failed to meet the contract requirements for the electronic system for recording and measuring school jobs. In other words, the problems in school opening were associated with poor contract, HR, information, and communication management.

Suggested Solutions

Even though the identified issues may be considered minor since the program stays on schedule, the project will benefit from addressing the identified problems in the shortest possible time. First, governance is to identify a coherent philosophy using the world’s best practices. The unified philosophy of all the key stakeholders implemented by project governance is associated with an improved decision-making process at all levels. If guided by a unified philosophy, all decisions become coherent among all the stakeholders.

Second, the program should employ the latest supporting technology to coordinate the program. Information management has been identified as one of the central issues with program governance. Therefore, the governance needs to establish a unified information reporting and dissemination system to ensure that all the stakeholders have the latest information available. In particular, a web portal can be created, which will serve as a forum used by all the stakeholders to share the latest updates on the project.

Third, governance needs to conduct systematic audits of contractors to identify problems and take corrective actions timely. The audit conducted by the Office of the Auditor General is an excellent example of a well-structured audit. The project governance needs to learn from this experience and periodically assess the process to identify current and potential issues. Such actions can prevent additional costs and schedule problems. In case the audits reveal any deterioration in the quality of work, relevant corrective actions are to be identified and implemented.

Finally, the project can benefit from training contractors’ personnel to adhere to high-quality standards set by governance. In particular, training should be focused on information reporting and dissemination, as data management was identified as one of the weakest points of the project’s governance. The training should include information on data management and communication skills to promote efficient information sharing among stakeholders.

Stakeholder Circle

Stakeholder Circle is an efficient technique for managing stakeholders, which is valued for its simplicity, expressive visualization, and self-descriptiveness. The method helps to identify the power environment inside a project, a program, or a portfolio. Efficient stakeholder management is associated with early risk recognition and an improved decision-making process. Eight groups of stakeholders were identified and examined in order to map their influence and distance to the project. The stakeholders include EduWest, DoE, DoT, project manager, contractors, suppliers, students, teachers, school authorities, the community, media, the cabinet, and parents. Figure 1 below is the stakeholder circle for WA PPP program created in Microsoft Paint, a standard MS Windows graphics utility.

Stakeholder Circle for Western Australia Public Private Partnership Program.
Figure 1. Stakeholder Circle for Western Australia Public Private Partnership Program.

Key Stakeholders

Stakeholder 1

According to Figure 1, the two most influential stakeholders are EduWest, the lead contractor, and DoE, the asset owner. They both have similar tremendous influence and distance to the project, while their attitude to the project is neutral. EduWest is responsible for fulfilling all the requirements, following the timeline, constructing and maintaining the facilities, and coordinating with all the other stakeholders. Therefore, the stakeholder is very close to the project but does not have the ability to “kill” the project, which is reflected in the Stakeholder Circle. EduWest has the power to alter any policies as long as they adhere to the contract requirements. Hence, the influence of stakeholders is moderately high. EduWest’s primary interest is receiving the money for their work and improving their reputation to ensure the organization’s sustainability in the future.

The primary issue with the stakeholder is that its attitude is neutral, as it is only interested in the financial part of the project. In other words, the quality standards and project schedules are followed only because they have financial implications for the company. Therefore, the primary objective of managing EduWest is to try to make their attitude positive and explain the benefits of the project. By changing the attitude, EduWest will acquire non-financial incentives to fulfill contract requirements. In order to improve the attitude and raise interest in the project, EduWest should be engaged in public participation. In other words, it is vital to react to publically react to all the inputs from the stakeholder to maintain their interest. For instance, if EduWest accomplished a deliverable before schedule or at a better quality than expected, it should be acknowledged in the press so that other stakeholders have a higher appreciation of the stakeholder. Moreover, the stakeholder should be informed about any changes in the project and invited to all the collaborations.

Stakeholder 2

The DoE is very close to the project and has a significant influence on it. The primary interests of the stakeholder are ensuring the best educational outcomes, achieving value for money, and receiving approval of the government and the community, which implies that the stakeholder has a heavy interest in the project. DoE is the primary controller of the program since it controls EduWest. Since the interest of the stakeholder is positive, recommend empowering the stakeholder. However, it has to be supervised by community authorities and the Department of Finances.

When managing DoE it is vital to consider that they have both high power and a positive attitude towards the project. Therefore, it is vital to maintain close consultation with the stakeholder. It is central to maintain the support of the entity, keep the stakeholder involved in the project, and inform about every change in the project. Specific actions may include scheduling frequent collaborative meetings to understand if the stakeholder is satisfied in approves of the project’s progression. Such collaborations also help to engage the stakeholder in the decision-making process. At the same time, DoE should be kept informed at a detailed level, including current or anticipated project issues. Therefore, it should be filed all the reports and comprehensive reviews of these reports. In summary, the primary objective of stakeholder management strategy should be to maintain approval and engagement.

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