A pilot study on the integration of risk and value Management

Public Private Partnerships (PPPs) are being widely used by governments to deliver infrastructure development projects with the aim of achieving value for money through private finance. However, speculation exists in regard to this method of procurement and delivery of projects through PPPs in achiving Value for Money to the stakeholders.. This research is part of an on-going doctoral study into the integration of risk management (RM) and value management (VM) in PPP projects. RM and VM are regarded as best practice methodologies in project management and are widely applied in PPP projects. VM uses facilitation to pursue best value through explicit identification of desired project functions and subsequently RM sets out to reduce risk. Fundamental similarities between these methodologies suggest that they are consistent and integrated together. Organisations are deemed to take risk in order to maximise value. Likewise, it is considered that VM also helps pursue the interests of RM and vice versa, so conducting these two activities separately may result in a duplication of effort. Thus, there is an argument that the wider implementation of an integrated risk and value management (IRVM) framework in project management would deliver added benefits leading to better project outcome. This paper is a pilot study conducted through ten semi-structured interviews with experienced professionals to investigate the practice of value and risk management in infrastructure development projects, predominantly in PPP projects. It has been identified that although RM and VM are said to be used within the organisation, formal risk and value management are rarely used. At the same time, it is identified that due to lack of knowledge and lack of an available guidelines on an IRVM process, it is highly desirable to formulate an appropriate framework.