Lessons in Public Private Partnerships

Over a lunch meeting today, a few representatives of a Global Donor wanted to understand the lessons I learnt in managing Public Private Partnerships. Here are the three lessons I shared with them:

Lesson 1: Design PPP projects in specific areas where Governments have failed to deliver the goods, or where Institutions created at a point of time are not relevant any more. Identify what value Private Sector can add to change the outcome to more desirable ways. Propose an option with clear roles for both partners (Principal to Principal or Principal to Agent etc). Role of Government could be Policy Reform, Bringing Legitimacy, Make Investments, Facilitate Convergence; role of Private Sector could be in bringing Consumer Understanding, Building Market Linkages, Make Investments, Manage Convergence. Lack of clarity in roles, or lac of complementarity in roles, or lack of convergence in the outcome objectives will lead to failures.

Lesson 2: “Public” is not one entity. Understand that there are three layers in Public, viz. Political leadership, Senior Bureaucrats and Operating Level Government Employees. Understand that all three layers have different personal / professional objectives and postures. Need to build an alignment individually with the global outcomes expected from the project

Lesson 3: Need to co-opt an additional P to make the project relevant. People. Or Communities, if you were to use a PPCP instead of a PPPP! This co-option being somewhat social in nature (as opposed to purely economic logic) needs to factor in class and caste dynamics