Www.ibl.uni-stuttgart.de Institute of Construction Management European Real Estate Conference 2011...

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eInstitute of Construction Management

European Real Estate Conference 2011

University of Stuttgart

To the term efficiency by Public Private Partnerships

Dipl.-Ing. Hans Christian Jünger

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15th June 2011 ERES Conference 2011, Eindhoven

To the term efficiency by Public Private Partnership

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University of StuttgartInstitute of Construction Management

Institute of Construction Management, University of Stuttgart

• Faculty 2: Civil- and Environmental Engineering

• Foundation: 1964

• Principle: research and teaching with practical relevance

• 7 Assistants: everyone at least 1 year of experience in the

industry

• Courses of studies: “Civil Engineering“ and “Real Estate

Engineering and Management“

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Public procurement

Need of procurement through difference between objectives and reality.

Result or effect (Outcome) compared with objectives

Input, e. g. information, capital, knowledge

Product, service provided e.g. school building (Output)

Definition of objectives

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Relationship of terms

objectives

Input Output

?Outcome=

efficiency

effectiveness = doing right things

= doing things right

effectiveness of measure

effectiveness of execution

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Placing of Public Private Partnership

Placing according to act against restraints of competition (§97 GWB):

„… in a transparent procedure to the most efficient offer…“

Efficiency is a diffuse term in public procurement!

No standardised and structured identification of efficiency!

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Public Private Partnership (PPP)

• Lifecycle approach :

- Building realisation (planning and construction)

- Building services (Facility Management)

- Organisation (owner duties, contact person for client)

- Financing (bridge, long term)

• Ressources (e. g. employees, equipment, capital) in common organisation context

• Project risks distributed according to competence in risk management

• Procurement model for public real estate and related services

• Long-term cooperation regulated by contract (>20 years)

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Complexity of PPP

• Duration, long running project

Efficiency of PPP bids not obviously!

• Different interests

• Multiplicity of persons involved by client and private partner

… because PPP contracts are complex due to:

• Mutual influences and dependencies of services

• Diversity of services

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Definition of efficiency

• Minimum rule/ maximum rule/ optimum rule of efficiency

• Efficiency is the most sustainable advantageous ratio between achievement of objectives and consumption of resources

efficiency =cost

=degree of objective achievement

consumption of resources

• Minimum rule due to necessity of thrift by public authorities

problem: benefit measurement and cost calculation!

benefit

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Benefit measurement by quality

• Degree of quality measurable, e.g. by system of points

• Benefit as quality of PPP product?

quality = realised characteristics to required characteristics.

required characteristics (Input)

compared to

realised characteristics (Output)

enables to indirect measurement of benefit!

• Substitution of term benefit by term quality:

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Research project:

Standardised method for PPP total cost calculation

• duration: December 2007 to May 2009

• research objective:

- cost by cause calculation over life cycle

- transparency especially by building service costs

Cost calculation

• research partners and advisory board:

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• standard term definitions

Research results of standardised PPP total cost calculation

see also website:

www.ppp-kalkulation.de

• list of all standard-services

• schematical procedure of calculation

• continous risk management

• display of comparable results

PPP servicesorigin

DIN 276KG 100 …KG 200 …KG 300 FassadeKG 400 …KG 500 …KG 760 Finanzierung

GEFMA 200……Reinigung……

DIN 18960……Reinigung……

weitere……

Objekt-realisierung

Objekt-betrieb

Organisation

Finanzierung

Planen

Bauen

Betriebsvorbereitung

Betrieb

Baulicher Unterhalt

Objektrealisierung

Nutzungsphase

Endfinanzierung

Betrieb Bauphase

Zwischenfinanzierung

DIN 276KG 100 …KG 200 …KG 300 claddingKG 400 …KG 500 …KG 760 financing

GEFMA 200……cleaning……

DIN 18960……cleaning……

others……

Objekt-realisierung

Objekt-betrieb

Organisation

Finanzierung

realisation

operating

organisation

financing

Planen

Bauen


Betrieb

Baulicher Unterhalt

Objektrealisierung

Nutzungsphase

Endfinanzierung

Betrieb Bauphase


planning

construction

operating preparation

operating

construction servicing

realisation phase

utilisation phase

long term financing

operating during constr.

bridge financing

origin




weitere……

Objekt-realisierung

Objekt-betrieb

Organisation

Finanzierung

Planen

Bauen


Betrieb

Baulicher Unterhalt

Objektrealisierung

Nutzungsphase

Endfinanzierung

Betrieb Bauphase





others……

Objekt-realisierung

Objekt-betrieb

Organisation

Finanzierung

realisation

operating

organisation

financing

Planen

Bauen


Betrieb

Baulicher Unterhalt

Objektrealisierung

Nutzungsphase

Endfinanzierung

Betrieb Bauphase


planning

construction


operating


realisation phase

utilisation phase

long term financing


bridge financing

PPP servicesorigin




weitere……

Objekt-realisierung

Objekt-betrieb

Organisation

Finanzierung

Planen

Bauen


Betrieb

Baulicher Unterhalt

Objektrealisierung

Nutzungsphase

Endfinanzierung

Betrieb Bauphase





others……

Objekt-realisierung

Objekt-betrieb

Organisation

Finanzierung

realisation

operating

organisation

financing

Planen

Bauen


Betrieb

Baulicher Unterhalt

Objektrealisierung

Nutzungsphase

Endfinanzierung

Betrieb Bauphase


planning

construction


operating


realisation phase

utilisation phase

long term financing


bridge financing

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Conclusion and prospectConclusion and prospect

• cost calculation by standardised PPP total cost calculation

• benefit becomes measureable by the term quality!

• ratio of benefit to cost is relevant!

efficiency transparent measurable for placing of PPP contract!

• efficiency is diffuse term in public procurement!

• there is no structured and standardised identification of efficiency!

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Questions?Questions?

Thank you for your attention!Thank you for your attention!

Www.ibl.uni-stuttgart.de Institute of Construction Management European Real Estate Conference 2011...

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