Model for assessing performance defects in public-private partnership projects

Model for assessing performance defects in public-private partnership projects

Multiple public-private partnership (PPP) projects in Australia have failed to perform as anticipated. These projects fail to address several project performance defects (PDs) because local performance assessment methods are generally limited to ex-post evaluations. Existing performance assessment models (PAMs) are either latent, limited, or underdeveloped. This study employs a quantitative methodology based on critical multiplism and grounded theory to develop, test, and validate a comprehensive PAM for Australian PPPs. Using a systematic literature review following Preferred Reporting Items for Systematic reviews and Meta-Analyses (PRISMA) guidelines, 48 critical success factors (CSFs) and 93 PDs were identified. These were contextualized into 50 PDs relevant to Australian PPPs through local case studies. Six key performance indicators (KPIs)—resources, cost, time, quality, stakeholder satisfaction, and payment mechanisms—were used to build the conceptual PAM. Data is collected from 336 PPP experts through a questionnaire survey to test the conceptual PAM using the structural equation modeling approach and confirmatory statistics. Findings revealed that 29% of experts were unaware of PAMs. Statistical analysis (correlation, ANOVA, regression, multivariate tests) was used to validate the conceptual model. Three KPIs—resources, stakeholder satisfaction, and payment mechanisms—were excluded due to limited significance. PDs were reduced to five core issues: design delays, supply chain disruptions, poor resource control, sub-standard workmanship, and discrepancies in projected vs actual values. The final PAM integrates three KPIs (cost, time, quality), the five PDs, and an additional construct of experience. Model validation tools (chi-square, comparative fit index, normed fit index, relative fit index, root mean square error of approximation, Akaike information criterion, parsimony normed fit index, and Hoelter index) confirmed a statistically robust and superior model. The 3-KPI PAM outperformed its 6-KPI counterpart. The proposed PAM supports early defect mitigation, strategic resource allocation, and data-driven decision-making. Key recommendations include assigning CSFs to suitable parties (financial to owners, policy-related to regulators), proactive PD management through training, planning, stakeholder engagement, and national-level PAM implementation. The proposed PAM promotes transparency and continuous improvement, aligning with public objectives. It contributes to theories of KPIs, value creation, total quality management, and capability maturity, with applications across various sectors, including infrastructure, transportation, energy, waste management, disaster recovery, and governance. While challenges such as industry resistance and subjectivity remain, the proposed PAM represents a significant advancement in ensuring the long-term success of Australian PPP projects.