Basic Ingredients That Public Sector Projects Require
Mr. K JAIRAJ
There is a great need for project management in the public domain. There's a perception that the government deals mainly with "soft" sectors in the public domain such as healthcare and education and that there is no need for project management practices. But that is not true. The government deals with "hard" sectors like infrastructure. Even in the "soft" sectors, project management practices are required for effective implementation. In fact, project management is the heart of implementation.
I have used project management in major infrastructure projects like in the power sector. I was managing director of Karnataka Power Corporation Limited where we worked on the Rs 15,000 crore, 450 mega watt expansion of the power project. It was financed by the private sector at an interest rate of 16.5 percent. But we managed to execute it well with no time and cost overruns. In fact, it created a record in the power sector, with its completion nine months ahead of time. We also saved a considerable amount of money.
The following are some project management practices for work in the public domain:
1. A project must be well researched and well designed, and put together within a consistent framework. Once the project is designed, there should be minimal rework. In the public domain, rework is a bane: the scope of the project, the design is changed many times due to faulty planning. In the power project at Raichur, Units 5 and 6, in Karnataka, we froze the design and scope of the project once it was in place. We allowed no changes. The iron discipline helped in the specifications being firmed up. Thus there was scrupulous implementation. Thatís the advantage of definiteness in a project.
2. The project should be well-funded. If it is semi-funded, the money gets dried up midstream and the project stops. Even on resumption, the momentum must be built up again and there is delay. Cash gives a certain 'certainty' to a project. That certainty is critical.
3. Agencies which execute the project must possess the competence to execute it. Raichur 5 and 6 was gigantic in nature - there were 65 contracts in all. It called for an agency with competence of a high order. You must select the agency based on objective criteria such as quality, market record, track record, engineering expertise, and so on. Those of a high order perform well. But in the public sector, selection could be based on sweetheart deals. (These are undue favors shown by the procurer to the seller. For example, the procurer might enter into a deal with the seller either in terms of fixing the quality or hiking the price; he accepts substandard quality or asks for a higher price). So projects sputter away and enormous time and money are lost.
4. Today, we need a partnership approach to project execution. The owner is not the boss, the agent not the serf. The owner cannot pretend to call the shots; the contractor or agent cannot be treated like a daily wages worker. All the stakeholders must be equally involved.
5. Today, there is a need for incentives for performance. I introduced it in my projects. If the design was ready 10 percent ahead of the time frame, the person responsible for it was rewarded, he would get a bonus. If it was completed even earlier, he would get a bigger bonus. In the said project, even a public sector unit like Bharat Heavy Electrical Limited earned a bonus of Rs 70 crore, on a total project worth Rs 700 crore. Even the mechanical and electrical units got a bonus. So incentives must be a part of project management practices; however, make sure that the targets are not low.
6. Another commendable practice is good communication at all levels and all spheres - between management and agencies, at the field site, with the outside world, with finance agencies. Good communication, both external and internal, creates a performance ethic all around. It increases performance and productivity.
7. Any good project must emphasize wins and celebrate successes. A project must have milestones, and each time a milestone is reached, it must be celebrated. For example, when a milestone is reached on schedule or ahead of schedule, you must celebrate: throw a party, have a bonfire night, hold a recognition function, have it written about in the media. It may sound trivial, but what it does to the morale is critical.
At the end of the day, you must also be lucky. Because a bad politician, an incompetent bureaucrat, acts of nature, or disasters can mess up a project. But even with politicians, it can be a matter of circumstance. The bigger the project, the bigger the sense of ownership on the part of the politician. It is the astuteness of the manager that can save the day. The golden rule is that you must make the politician feel responsible for the success of the project. It is about managing the expectations of the politician.
(Mr. K Jairaj, IAS, retired recently as additional chief secretary to the Government of Karnataka. He has held diverse assignments in infrastructure, energy, transport, and urban development. He was principal secretary to the chief minister of Karnataka, and commissioner, Bangalore City Corporation for two terms. He helped establish the Bangalore International Airport Limited on a public private partnership basis. Currently, he is the trustee and secretary of Bangalore Political Action Committee.)
-As told to Geetha Rao