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Micro-Economical Aspects of Public Projects: Impact Factors for Project Efficiency and Sustainability


SECOND EDITION

By Emīls Pūlmanis
PhD.cand., MSc.proj.mgmt.
State Audit Office (Latvia)
Development project manager

Riga, Latvia

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Abstract

Project management approach in the public administration becoming gradually applied tool for implementation of different public programs and activities. Latvia has several methodological documentations to evaluate the possible benefits from infrastructure but still there is need for improvements as the only clear defined methodology is for transport sectors and those which have been provided by the European commission, but not always have been practically used in local municipalities’ project evaluations.

Public projects, and planning for such projects, generally have the following characteristics:

  • Such projects are inherently risky due to long planning horizons and complex interfaces.
  • Technology is often not standard.
  • Decision making and planning are often multi-actor processes with conflicting interests.
  • Often the project scope or ambition level will change significantly over time.
  • Statistical evidence shows that such unplanned events are often unaccounted for, leaving budget contingencies sorely inadequate.
  • As a consequence, misinformation about costs, benefits, and risks is the norm.
  • The result is cost overruns and/or benefit shortfalls with a majority of projects.

Paper exanimates public project management applications in the context of the underlying structure that adverse dynamics and their application to specific areas for micro-economical level of project management, synthesizes the policy messages, and provides directions for future research. Public sector project management in Latvia become popular in recent years as there is different type of public funding sources available.

The paper examined the application of the project management practice and its micro-economic aspects in public sector in Latvia. Public sector project management in Latvia become popular in recent years as there is different type of public funding sources available. The paper describes the public sector project management practice in Latvia. Study shows that public sector project maturity level is low and should be improved. Research period covers the time from January 2013 – March 2015.

JEL codes: O220, H430, H540

Keywords: project management, project planning and initialization, public sector, efficiency

Introduction

Government and organizations usually embark on different projects with the aim of creating new service or improving the functional efficiency of the existing ones. All these projects require appropriate skills and techniques that go beyond technical expertise only, but encompass good and sound skills to manage limited budgets, and monitor shrinking schedules and unpredicted outcomes, while at the same time dealing with people and organizational issues (Abbasi, Y. G. & Al-Mharmah, 2000). The application of project management practice in public sector has been identified as an efficient approach which would help in upgrading management capabilities and enable public sector to efficiently complete projects and attain developmental objectives (Arnaboldi M., Azzone G., & Savoldelli A., 2004).

Recipients of funding – both public authorities, public institutions and businesses, is a major challenge for financial gain and to promote public welfare. However, the benefits bring with them the responsibility for waste and financial records and reports on practical goals. Funding Administration requires thorough knowledge and understanding of the law. A growing number of mass media and the administration of financial instruments institutional statements we hear that a large number of project applications, which is a low quality place. Now that the errors and weaknesses in project development and administration are unacceptable, more and more to think of an effective system that would be according to the conventional project management theory. Such a system would be built at local level, ensuring appropriate project specialist, but the program level, i.e. need to improve the administration of financial instruments including methodical and regulatory documents update and synchronize project management theory to improve the project initiation process and ensure the quality of project applications development, thus resulting in an effective and rational use of taxpayers’ money (Pūlmanis, 2012).

The typical steps of project planning are:

More…

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Editor’s note: Second Editions are previously published papers that have continued relevance in today’s project management world, or which were originally published in conference proceedings or in a language other than English. Original publication acknowledged; original copyright pertains. This paper was originally presented at the 4th Scientific Conference on Project Management in the Baltic States, University of Latvia, April 2015. It is republished here with the permission of the author and conference organizers

 

About the Author

 

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Emils Pulmanis

Riga, Latvia

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Emils Pulmanis is a member of the board of the Professional Association of Project Managers in Latvia and development project manager at State Audit Office of the Republic of Latvia. He has gained a BSc. in engineer economics, a professional master’s degree in project management (MSc.proj.mgmt) and currently is a PhD candidate with a specialization in project management. He has elaborated and directed a number of domestic and foreign financial instruments co-financed projects. He was a National coordinator for a European Commission-funded program – the European Union’s financial instruments PHARE program in Latvia. Over the past seven years he has worked in the public administration project control and monitoring field. He was a financial instrument expert for the Ministry of Welfare and the European Economic Area and Norwegian Financial Mechanism implementation authority as well as an expert for the Swiss – Latvian cooperation program as a NGO grant scheme project evaluation expert. He has gained international and professional project management experience in Germany, the United States and Taiwan. In addition to his professional work, he is also a lecturer at the University of Latvia for the professional master study program in Project management. He has authored more than 25 scientific publications and is actively involved in social activities as a member of various NGO’s.

Emils can be contacted at [email protected].

To view other works by Emils Pulmanis, visit his author showcase in the PM World Library at http://pmworldlibrary.net/authors/emils-pulmanis/