Further to our White Papers on the importance of project governance such as 2018-01 ‘How governance can make or break a project’, our new White Paper 2020-08 ‘How Project Governance must be set up for Contractor Consortium and Joint-Venture Projects to achieve Success’ examines in more detail recommended practices for governance of projects involving a consortium or a joint venture. Too often we observe in this situation bloated and ineffective governance setups which severely hinder the project from achieving success. The White Paper details recommended practices for setting up the governance of such projects.
In an era when clients increasingly seek to be provided integrated solutions and avoid managing interfaces, contractors increasingly establish consortiums or joint ventures to respond to this expectation. This allows to combine several specialties to respond to the need but at the same time requires an effective governance framework between organisations that sometimes have to learn to work together. In certain cases, those consortiums can be setup between entities of the same group of companies; contrary to what could be believed, it is not always the easiest situation because of the complexity of organisational politics and tendency to be less formal when working internally.
Good practices include:
- Implementing trust-building practices and sign the agreement before submitting the bid
- Proper project planning
- Designating a single Project Sponsor – and a single Project Director
- Providing sufficient authority for the Project Director
- Having pre-established rules of engagement beyond the initial budget
As consortiums and joint-ventures amongst contractors become more frequent to respond to market expectations, sound governance practices need to be implemented. Still, nothing can replace a sufficient amount of trust between the parties that need to be maintained on the long term. In addition, the nomination of a single, competent Project Sponsor and adequate delegation of authority to a trusted Project Director will go to a long way to ensure success of the venture. Read our new White Paper 2020-08 ‘How Project Governance must be set up for Contractor Consortium and Joint-Venture Projects to achieve Success’ for more detail about what needs to be done in this situation.
If you can’t access the link to the white paper, copy and paste the following link in your browser: https://www.projectvaluedelivery.com/_library/2020-08_project_governance_for_contractors_consortiums_JV_projects_v0.pdf
