Key factors to consider in APD project pursuits

Alternative project delivery projects are becoming more common
Tuesday, February 21, 2017
by Gord Johnston

Alternative project delivery (APD) projects can take many forms, ranging from design-build (DB) to full public-private-partnership (P3), and are becoming more common for large, public infrastructure projects. Over the years, we’ve learned a lot of lessons. What to do, what not to do, and what can unexpectedly catch teams off guard and take a project off the rails. In our current, competitive environment – fueled by the promise of more APD projects, consultants need to consider several key factors in successful APD project pursuit and delivery.

Track trends In Canada, most APD projects are public sector driven. This gives consultants ample time to look at the scope of projects and track potential funding through the release of government budgets. By monitoring the funding cycle, and budget allocation, we can estimate the timing of the RFP and estimated project completion. This is the time where you need to identify if you have the capacity, and ability to pursue the project.

Better together No company can go it alone. A trusted team of partners needs to be assembled to deliver a project that clients are happy with on time, and on budget. Because potential projects are typically identified years in advance, there is plenty of time to begin assembling the team. I recently attended the Canadian Council for Public-Private-Partnerships conference in Toronto. Not only was there a great discussion about various P3 opportunities across the country, it was clear that attendees were interested in meeting with potential partners to discuss teaming opportunities. If firms want to be successful, they need strong partnerships established well in advance of the RFP. Ideally, firms should build teams with which they have a history of success, as clients are looking for a team that they know will work well together and has a long history of proven performance.

Building capacity While formalizing external partnerships, it is critical that you look at building capacity internally. For example, if the objective is to successfully compete on transportation projects, make sure you have the bench strength and capacity to pursue and deliver on these opportunities. P3 projects are multi-year efforts. If more than one project is secured, your designers, construction services or project management team commitments could overlap. Coordination is key to ensuring you do not under deliver on the service you committed to. The challenge is not to spread resources too thin.

Timelines can make or break a project Waiting for an APD project to begin can often take years. From the initial project announcement to pursuit to team selection, projects often see a number of delays. However, once the project is announced, the clock starts and clients often identify short timelines for key milestones. Often, these timelines are tied to financial incentives. If the project is late, the team can be penalized. If delivered early or under budget, the team could receive a bonus. While unexpected challenges or delays can occur anytime or on any project – when working on an APD project the pressure to deliver on time is elevated. Communication is the only way to keep a project moving ahead. At the beginning of the project, be clear on approvals, and expectations. Anyone who has worked on a P3 knows clear communication is the only way to successfully deliver a project.

Consistency is key A change in staff on the project team, or a change on the client side can easily take a project off track. The group of people at the beginning of a project must remain on the project until the end to maintain continuity. In fact, some clients are now looking at penalizing teams for staff changes in key positions. As these are multi-year projects, creative ways need to be found to encourage people to see a project through to the end but ultimately, it is imperative to maintain a consistent project team to ensure successful delivery.

Stay optimistic about opportunities A year ago, the industry thought that the funnel of P3 projects and funding would be flowing in 2016. The new federal government specified that APD would play a big role in getting infrastructure projects off the ground. While budgets have identified priorities for the next five years, we are waiting for details on the new infrastructure bank and how that will impact infrastructure priorities. Does opportunity exist? Yes. Do we know what will materialize in the next six to 12 months? No. So take the time now to identify what you want to chase. Build your capacity and be ready.

Gord Johnston is the executive vice president and business operating unit leader for Stantec’s infrastructure practice leading the transportation, community development, and water business lines. He has 30 years of private and public sector experience in the design and project management of infrastructure projects throughout North America and abroad. 

Photo: Stantec P3 project – the Iqaluit Airport Improvement Project

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