9 May 2019

Project Preparation – how should governments communicate projects?

9 May 2019

Communication throughout infrastructure project preparation should be recognised as a strategic activity. It should factor in the importance of all key stakeholder groups towards the project, tailor communicative actions to engage and inform them and foster a supportive environment.

Through analysis of leading practices from countries which have established a strong base for infrastructure project preparation, Chapter 6 of the Global Infrastructure Hub’s (GI Hub) Reference Tool on Leading Practices in Governmental Processes Facilitating Infrastructure Project Preparation (the Reference Tool) identified two key aspects of communication during the project preparation phase:

  1. The formulation and delivery of a stakeholder engagement action plan; and
  2. Evaluating market interest early in the project preparation phase through the market sounding of projects.

Proactive engagement with stakeholders early on can help to systematically identify sources of support and opposition and facilitate better alignment of project design to aid smoother implementation. For PPP projects, market sounding of the project to potential developers and investors to evaluate market interest during the project preparation phase was also found to be particularly important.

Engage with stakeholders early and often

Stakeholder engagement during infrastructure project preparation assumes substantial significance given the multi-faceted nature of large infrastructure projects and the complex stakeholder interfaces they tend to cut across[1]

Stakeholder groups could have interests and concerns that are very different from each other and, in some cases, conflicting

Mapping and addressing these expectations during the early stages of project preparation therefore becomes critical.

The Indonesia country case study provides a good example of early engagement, as public consultations and market sounding are mandatory for all PPP projects at the pre-feasibility and feasibility stages.

The Reference Tool recommends that, as a first step, all stakeholders that either influence the project or are impacted by the project should be identified and mapped, and the intensity of communication efforts required should be assessed. The government should also ensure that vulnerable groups or those at risk of exclusion are identified and included.     

This mapping exercise can be conducted through a Communication Needs Assessment (CNA), which systematically captures the views of stakeholders on relevant issues, the benefits expected and possible concerns.  The scope and depth of the CNA is context and project specific, and the communication actions required can vary significantly. Conducting a CNA in the early stages can mitigate future issues arising.

Stakeholders can also be categorised by their behaviour, influence and importance, so that specific communication messages can be targeted towards them.

An Importance-Influence Grid can be used to segment stakeholders in a manner that aids communication planning.  “Importance” relates to the degree of stakeholder involvement in the achievement of the project objectives, whilst “Influence” refers to the power that stakeholders could have in the decision-making process directly or by facilitating or resisting the project’s implementation.

These processes will help to develop and deliver an appropriate communication plan to engage stakeholders effectively.

Identify, attract and engage with potential bidders

Developing an active private sector engagement strategy to attract private operators from the early stages of project preparation can be crucial to facilitate competition.  Especially in contexts where there is limited precedent of PPP projects and the local private sector ecosystem is undeveloped, marketing and market testing a project early in the project preparation cycle is very useful.

To prepare for market sounding, the government contracting authority should:

  1. Identify and engage as wide a set of potential bidders as possible; and
  2. Identify positive aspects of the project which: a) position the project as an attractive investment opportunity; and b) position the government contracting authority as a credible partner which will honour its obligations under the project contract.

The South Africa country case study highlights an example of successful private sector engagement by adopting a program, rather than project, approach. The Renewable Energy Independent Power Producer Procurement (REIPPP) Programme was able to rapidly scale-up renewable energy generation through private participation.  A key underlying factor of the program’s success was continuous engagement with the private sector and bankers,  helping to align the program design with the prevailing market environment.

Stakeholder engagement was largely driven through consultative workshops organised across major project locations with active involvement of local stakeholders, including local government. The team also conducted focused interactions with the private sector and ensured periodic and transparent disclosure of project terms.

The Reference Tool guidance states that government contracting authorities should consider creating dedicated capacity within their team to handle stakeholder management and market sounding activities, particularly for more complex projects, where it would be useful to have dedicated, specialist staff solely accountable for handling the communication aspects of the project.

More detailed guidance for project communication and market sounding can be found in Chapter 6 of the GI Hub’s Reference Tool.

You can read our previous blog in the series on translating a concept into a bankable infrastructure project here.

 

[1] For more detail on the importance of stakeholder engagement in large infrastructure projects, please refer to the GI Hub’s upcoming Reference Tool on Inclusive Infrastructure and Social Equity, particularly Action Area 1: Stakeholder Identification, Engagement and Empowerment, available at https://www.gihub.org/news/consultative-version-reference-tool-on-inclusive-infrastructure-and-social-equity/