Benefits of P3 Models - Utilities and Efficiency
In many countries today, divisions like Toll Roads, Airports, Food Courts, and even Parking Lots have accepted the concept of P3 or Public-Private Partnerships. Under the system, private parties collaborate with public entities and develop a public model for faster progress and better productivity while often times collaborating in the management of the ongoing operations.
There is a striking difference between a P3 organization and a completely private body. In the case of a P3 model, both the public and private sectors will play a major role, including divided ownership and operation of the main functionalities and assets as well as the management and maintenance of the facility. In the case of a completely private body, the entire asset is awarded to private parties, and the public sector has no authority after the award.
Understanding the Concept of P3
According to Cindy Wallis-Lage, President of Black & Veatch’s water division, there are two important objectives for making P3 a success. The first objective features the understanding of the partner and an ability to maintain the objectives and interests. Second is the fund allocation point, which is vital for the growth of any business today.
Popular Vantage Points of P3 Models
Capital Improvement Efficiencies: P3 models use asset management techniques to forecast the project. In doing so, the overall efficiency is increased, and a systematic approach is emphasized.
Managing Assets: Under this technique, a complete project life cycle is taken into consideration. Parties will have the database, a set of complete project life cycle analyses, and results showing possible flaws and ways to upgrade each asset.
Utilization of Workforce: Depending on the model, the workforce is utilized upon consideration of the usage only.
P3 Customization: A major advantage of this model is that it can be customized according to the needs of the target. No two partnerships are exactly alike.
Retention of Assets: As much as ownership is important, the public-private partnership can ensure the ownership stays within the hands of the public, and there is no harm to that asset.
Capital Fund Flow and Growth of Economy: In the case of different P3 models, there are numerous concession models available in terms of capital. The model is also known to enhance the infrastructure growth of a location.
Technology Advancement and Saving Resources: P3 models emphasize the advancement of existing technology and adaptation to newer means. In addition, saving natural resources and proper utilization is often a factor.
Opening Newer Avenues of Earning: With the P3 model, newer avenues of earning can be produced, ensuring a productive usage of resources.
P3 models are devoted to bringing out the best between two models of business, to perform an assigned task together. With this, the overall productivity is not compromised, but rather, it is enhanced. Additionally, better management is one of the many benefits.
Interested in more P3 insights? Check out some of our other blogs on The History of the P3 Market and What's Next and the Top 5 ways to Align Vision of a PPP. If you want to learn more about how we develop effective strategies for public-private partnerships, reach out to us today to start a conversation.
