An effective outline business case to facilitate successful decision‐making

Abstract

Historically the public sector’s outline business case for Light Rapid Transit/Metro public–private partnership projects delivered in the United Kingdom has frequently failed to address the project affordability decision. As a consequence the business cases have had to be reworked, redeveloped or have required the project to be revoked, in each case wasting significant amounts of public and private sector time and money. The development and testing of an effective outline business case to facilitate successful project affordability decision‐making for PPP projects is described. A mixed methods research approach was adopted utilizing a case study research methodology, interviews with PPP experts to identify business case critical success factors and application of the analytical hierarchical process to assess their effectiveness. The Delphi technique was used to verify and validate the effectiveness of the outline business case. The findings demonstrated that the success of the outline business case in practice relies on three critical success factors: the degree of political support, achieving a balance between political PPP ideology and the market’s acceptance of the contractual model and the level of transparency and commitment from suppliers. These factors are major uncertainties, are difficult to represent accurately within the business case and signify a major constraint to the sponsor forecasting the project’s affordability.

Keywords:

• Public–private partnership
• business case
• project affordability
• project decision‐making
• analytical hierarchical process