Members of the Management, Procurement and Law editorial advisory panel provide overviews of their areas of expertise, highlighting recent and forthcoming developments likely to affect engineers and others working in the fields of management, procurement and law.

1. Proceedings of the Institution of
Civil Engineers
Management, Procurement and Law
000
Month 2008 Issue MP0
Pages 1–2
doi: 10.1680/mpal.2008.000.0.1
Paper 800038
Management, procurement and law: overviews
Members of the Management, Procurement and Law
editorial advisory panel provide overviews of their areas of
expertise, highlighting recent and forthcoming
developments likely to affect engineers and others
working in the fields of management, procurement and
law.
1. DONNIE MACNICOL
1.1. Overview of developments in project management
Project, programme and portfolio management have become
mainstream disciplines adopted by organisations outside of the
traditional industries such as defence and construction. They are
being adopted not only for delivering change within organisations
but also as a means of improving product and service delivery to
clients. This blurring of the boundaries between business as usual
and projects has in part been driven by the continuous need for
adaptation and evolution within business, and also acceptance of
the value the underlying approaches and processes can add.
Programme management is a distinct discipline with its own
methodologies and training. The word programme is often
misused to refer to large or complex projects. Portfolio
management is increasingly seen as a highly effective way of
aligning projects with business objectives and resources, typically
through a proprietary system. A range of enterprise-wide systems
exist to bring project, programme and portfolio disciplines
together to align them better with the business and the business
support infrastructure.
There is a growing distinction between project management and
the management of projects: project management is defined
through the numerous approaches, methodologies and
processes; the management of projects is the social interaction
between the project manager, team, client and stakeholders
together with the application of project management in an
intelligent and designed manner for the particular context. This
distinction is leading to greater realisation about the true nature
of projects, in particular change projects where there is no
physical product. This includes the importance of social
interaction, modelling and accepting complexity, multiple
perceptions of a project and what constitutes success, delivery
of value rather than outputs, the inadequacy of traditional fixed
life-cycles and the need to work with different cultures through
globalisation and the increased used of alliancing as a means of
gaining competitive advantage.
Many companies now have their own methodologies defining
what project management is and how it should be used. These
range from fully comprehensive mandatory procedures through to
frameworks that provide only guidance and support. Compliance
is monitored through health checks and peer review. Centralised
project/programme support offices where practices are developed,
competency support programmes (training, systems, processes)
established, collaborative and control systems maintained, best
practice and metrics captured, and performance measured are
becoming the norm. Centres of excellence, which may or may not
be aligned to the support office, are where the focus is more on the
process and knowledge gained to help performance than the
projects themselves. These are typically the home or centre of
gravity for the project management community of practice.
The role of the project manager has become more universally
accepted and adopted along with the realisation that the skills are
portable across industries. Demand for project managers is now
outstripping supply, especially for experienced individuals who
can lead and ensure delivery of large and complex projects. This is
particularly acute in the construction industry. Classifying the
project manager’s knowledge, skills and behaviours needed to
accomplish specified roles is becoming increasingly common
through tools such as competency baselines. Certification is
increasingly becoming accepted as a good way of building that
competence through professional bodies such as the Association
for Project Management. Training is provided through a range of
methods while mainly providing delegates with knowledge of
what project management is rather than the complexities and
nuances of managing a project. There are a range of further
developmental opportunities including higher education where
MSc’s and MBA’s are on offer in project management,
conferences, specialised user groups or networking organisations.
Project management is maturing away from the pure
identification and control of requirements, scope, resources, costs
and time through the widespread adoption of risk management,
value management, earned value, governance, benefits
management and whole-life costing and planning.
Other approaches such as systems approach, agile, critical
chain/theory of constraints, six sigma, uncertainty, complexity
theory and systems dynamics are now being used in conjunction
with project management to provide greater value.
Formal comparison of performance and practice between
companies is becoming increasingly accepted through
benchmarking. Maturity models are becoming popular as a means
of assessing and monitoring the optimisation and application of
project management practices and processes.
Management, Procurement and Law 000 Issue MP0 Management, procurement and law: overviews 1

2. In summary, project management is vibrant, maturing and now
the standard approach for teams and organisations to improve
performance in projects.
2. NIGEL J. SMITH
2.1. Private finance and risk management
Since the inflationary pressures of the oil price rises in the 1970’s
rekindled interested in utilising private finance for public
infrastructure, procurement systems have contained public,
private, and hybrid business models. Known as the Ozal formula
or BOT (build-operate-transfer), early procurement systems were
introduced in the UK subject to satisfying the Ryrie rules on value
for money and risk sharing. The public–private business models
have continued to evolve in the UK and today, whilst not a
panacea, are the preferred procurement route for most civil
engineering infrastructure projects.
One of the main concepts of these private finance, or concession,
contracts is that there should be an equitable sharing of risk rather
than an equal sharing of risk. Risks are allocated to the party best
able to manage or control the risk. In most concession contracts
the principal is allocated responsibility for much of the global risks
(legal, political, environmental and commercial), whilst the
promoter SPQ3 V is allocated responsibility for much of the elemental
risk (technical, operational, financial and revenue). Increasing
complexity and reduced durations put pressure on existing risk-
management methods.
It is unlikely that large increases in public sector spending will
occur in the short-to-medium term and so private finance
concessions are likely to be utilised for many years. The culture
change to the management of these investment projects which
involve infrastructure is profound. Private finance is not just
another type of bank; it involves the utilisation of private sector
commercial skills and entrepreneurship in project delivery and
banking.
REF Q1ERENCES
1. Issues that matter—round table discussion. Project, 2007,
Apr Q2il, 10–14.
2. MORRIS P. W. G. Current trends in project and programme
management. In The Association for Project Management
Yearbook 2004/5. Association of Project Management, High
Wycombe, pp. 105–107, Future Trends.
3. WINTER M., SMITH C., MORRIS P. and CICMIL S. Directions for
future research in project management: the main findings of
a UK government-funded research network. International
Journal of Project Management, 2006, 24, No. 8, 638–649.
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2 Management, Procurement and Law 000 Issue MP0 Management, procurement and law: overviews