Public-Private Partnership holdbacks: a case-based stakeholder management analysis

Objective:
Stakeholder opposition is reported as a main factor for the failure of Public-Private Partnerships (PPPs). By analyzing stakeholder management practices within PPP projects, we investigate stakeholder identification and inclusion. The paper first describes a theoretical framework for analyzing the salience of stakeholder management in PPP projects building on the extant stakeholder management literature. Then, this is applied and illustrated through a case study analysis of four large-scale infrastructure projects in Belgium. Our findings suggest that stakeholder attributes exhibit highly dynamic characteristics and that the two focal organizations look through a different lens at the PPP environment. Based on our analysis and considering the potential drawbacks of increased costs and conflicts of interests, we propose a dynamic dual stakeholder management approach.

Data/Methodology:
To investigate stakeholder management in PPP projects, we analyzed four case studies of infrastructure projects in Belgium. The case study method is particularly suitable for capturing and encompassing more elements of complex social problems than other research methods (Winn, 2001). Recognizing that PPPs cover a grammar of different meanings, we first identified a typology of cases in order to cover a relevant variation of PPP projects in our sample. Based on two dimensions, potential for internal and external stakeholder conflicts, we distinguished four types of PPPs and selected one case for each type. Secondary data was collected to identify all key stakeholders in the cases and to analyze their main objectives. To validate these observations, we interviewed 12 senior managers and key experts involved in the cases. A second validation was carried out by interviewing project insiders (more specifically 5 advisors) that worked simultaneously on more than one of the considered cases.

Results/Findings:
Our findings suggest that ex-ante inclusion of key stakeholders, together with the use of a dual dynamic stakeholder approach, is essential to avoid lack of ownership and inadequate stakeholder management. Analyzing and comparing four case studies demonstrate that this inadequate management is mostly caused by two mechanisms. First, the two focal stakeholders often ignore the dynamic aspects of the stakeholder environment. More specifically, they underestimate that stakeholder attributes may change over time due to the unpredictability of contextual factors such as political opportunity structure and opposition within networks. Second, a PPP project creates a confusing environment where different levels of stakeholder attributes can be recorded for the two focal stakeholders. In fact, they appoint different levels of influence to the same stakeholder, which may lead to a conflict in determining the right strategic actions towards each stakeholder.

Implications for Research/Policy:
Our research indicates that a PPP project creates a complex environment where questions emerge concerning the responsibility and the accountability for the stakeholder environment. Hence, we call researchers and institutions for the construction of new governance models that provide a response to these two issues.