Weekly insights on how to perform when it matters | High-stakes decisions. Real situations. No BS. | 👇JOIN +2k readers 👇
We've been discussing this issue for some time
|
January 2018. London. Whittington Hospital. A fire. It was controlled. Patients evacuated. The hospital continued operating. Crisis over? Not even close. The fire exposed a much bigger problem. There were serious disagreements. Condition of the building. The fire safety defects. Who was contractually responsible for fixing them. Etc. The NHS Trust said the PFI company had failed to remedy the problems. The PFI company disagreed. A “mis huevos” (ego battle) situation… Payments were withheld. The relationship collapsed. In 2020, the Project Company entered administration. The PFI agreement was terminated. Responsibility for the buildings and their maintenance returned to the hospital. And then the administrators sued the NHS Trust for £56 million. Think about that sequence. A fire. A defect. A disagreement over responsibility. Withheld payments. An insolvent SPV. Contract termination. Years of litigation. Investor losing money. Shareholders losing something worse… reputation. That is how operational projects go crazy. Not normally because of one spectacular failure. But because one problem reveals all the weaknesses that were already there: Poorly understood interfaces. Responsibilities that are not genuinely back-to-back. Defects that have been discussed for years but never resolved. Information that does not reach the Board clearly enough. A contractor saying, “That is not our risk.” An authority saying, “We are not paying.” And an SPV trapped in the middle. By then, contract management is no longer administration. It is asset survival. This is exactly why investors cannot treat the operational SPV as a mailbox between the authority / the ministry / the agency and the subcontractor. Someone must actively manage the asset. Someone must understand every interface. Someone must challenge the operator. Someone must identify the gaps before an incident exposes them. Someone must tell the Board the truth before positions become entrenched and lawyers take control. Now, I offer full SPV Management. We act for the SPV and its investors. We manage performance, contracts, changes, claims, risks and interfaces. And we help stop operational problems from becoming existential ones. Look. The most dangerous sentence in a project, especially during operations, is: “We have been discussing this issue for some time.” Interested? Book below.
PD 1: If you liked this email, don't keep it in secret and forward it to a friend. They will thank you enormously one day. PD 2: If somebody has sent you this email and you want to receive emails like this yourself, visit vicentevalencia.com PD 3: If you want unsubscribe, click the link below. |
Vicente Valencia
Weekly insights on how to perform when it matters | High-stakes decisions. Real situations. No BS. | 👇JOIN +2k readers 👇
You opened the project on time. Construction is finished. The ribbon has been cut. The lenders are happy. The Board can finally breathe. And then operations begin. Good for you. This is what we want to be in a big project. A few months pass by, and suddenly you realize that you are handling a different kind of monster. The subcontractor starts interpreting the contract in its favour. Small issues become recurring issues. Performance reports say everything is fine, while cash is slowly leaking...
Everyone speaks confidently. Everyone uses acronyms. And you are trying to work out whether you have missed something obvious. Suddenly, someone expects you to have a view. Sh*t… The problem is not that you are not capable. The problem is that nobody ever taught deep how PPPs really work. Not the theory. The decisions, traps, negotiations and mistakes that can define an entire career. Stop trying to learn PPPs one painful meeting at a time. Start thinking like a leader. Not how to sound...
Your biggest challenge is probably not technical. It is getting everyone to listen to you. Then, make sure they agree on what the real problem is. Then making a decision. Then making sure that decision survives contact with lawyers, contractors, financiers, Boards and government. The project rarely fails because nobody knew what to do. It fails because nobody took control early enough. What are you waiting for? Speak up. Some ideas, below. THE ROOM: 15 Great Lessons of a Successful PPP...