Critical performance factors of public sector organizations in concession-based public-private partnership projects

Abstract

Purpose The purpose of this paper is to evaluate critical factors that impact public sector organizations’ (PSOs) performance in PPP contracts with a view to improving their capabilities toward efficient project delivery and attracting more private sector investments. Design/methodology/approach The research methodology is a quantitative approach which commenced with an in-depth literature review that provided the basis for identification of the variables that were evaluated through a structured questionnaire. Respondents were professionals from stakeholders’ organizations that had been involved in PPP contracts in the Southwestern region of Nigeria selected using respondent driven sampling technique. These include industrial practitioners from governmental-based organizations (ministries, agencies, corporations/parastatals, etc.), private developers/concessionaires, law firms, and banks, among others. Data collected were analyzed using mean, relative significance index) and factor analysis. Findings The critical performance factors of PSOs in concession contracts clustered under nine components. These were technical, legal, political, finance, market maturity, economic, procurement process, performance guarantee and degree of regulation. PSOs’ capability development measure in countries newly experimenting with concession model is expected to focus on these factors for improved project delivery. Research limitations/implications The study provided implications for capabilities improvement, legislation and policy making with respect to PPP transactions in countries newly experimenting with PPP contracts. This is highly significant to improving the capabilities of PSOs and attraction of more private sector partnership in infrastructure delivery through the concession model. Practical implications The study provided implication for capabilities improvement, legislation and policing with respect to PPP transactions in countries newly experimenting with PPP contracts. This is highly significant to improving the capabilities of PSOs and attraction of more private sector partnership in infrastructure delivery through concession model. Originality/value Previous studies on PPP performance had either focused on the projects or generalized the performance assessment to PSOs and private investors. This study extended the researches on PPP performance by revealing factors specific to the public sector stakeholders.