Stakeholder analysis using Critical Systems Heuristics.

Refer to the rich picture

Within the rich picture, identify: project sponsor / client two other stakeholder groups with different expectations about the project (e.g. contractors, end-users, operators, media, local residents, etc.)

Answer the 12 questions from the perspective of the client in the 'is' and 'ought to be' modes: do you observe any differences?

Answer the 12 questions in the 'is' and 'ought to be' modes for the two other stakeholder groups.

Compare the answers between stakeholders: do you see divergences? are these risks the project leaders should be concerned about? make recommendations for action.

From following Case study

Hollowdale

The city of Hollowdale counted about 1.5m inhabitants. It was the country's fourth largest city, with a population growth above the national average. Its public service infrastructures for transportation, health care, education, and social services were all competing for additional resources, and the city's tax revenues could barely keep up. Public transport was of priority concern. Up to that point, the city had been relying on an extensive network of buses, underpinned by a series of reserved traffic corridors. However, the city had arrived at a point where downtown streets were clogged with buses at peak times, generating traffic congestion, pollution and noise. Public transport users were increasingly dissatisfied with the service, and the City's public transport manager was concerned that the current system was no longer sustainable: the downtown capacity had been saturated, and growing the city's public transport required a new approach.

The future of Hollowdale's public transport

The city council had been briefed by the public transport manager (Mrs Leentrak) that two options could be typically considered to grow the capacity of public transport in Hollowdale:

A metro system would provide high capacity (20k to 40k passengers per hour per direction - pphpd) - but the infrastructure costs, including tunnels and fast dedicated tracks, would be high

A light rail would provide lower capacity (typically 10k passengers per hour per direction), but the less demanding technical requirements make this a somewhat cheaper option

Public transport engineers have calculated that any system must have a capacity of a minimum of 20k pphpd to alleviate congestion in the city centre

Existing public transit corridors were available to be converted from bus to rail, in particular along the East-West arterial road.

The future of Hollowdale's public transport (2)

The transition from a bus-only to and bus-and-rail public transport system represented a transformational change for the Hollowdale public transit authority: rail operations required new skill sets (e.g. drivers), new infrastructure, the integration of what remained of the 'old' bus system with the 'new' rail system required new equipment (e.g. ticket machines, barriers, stations), and crucially a brand new, system-wide, rethink of bus routes and timetables. The public communications effort to explain the transition to the travelling public would be significant, and critical to the project's success.

Mrs Leentrack declared: "Hollowdale's rail needs are different that most: we are not creating a greenfield rail system, we are upgrading our dedicated traffic corridors from bus to rail in order to cope with the increased usage that comes with population growth. We also need a greener system: the new system must reduce environmental impacts. We need this new system urgently, and we need it to work at 100% capacity from day 1: no bedding down period, or gradual ramp-up, because we already know the ridership is there. As the Mayor said, we want this system <>."

Hollowdale: rail route options 5

Downtown Airport University East-West option North-South line NorthSouth extension Two design options were considered for the new rail public transport route: North-South: this option would see the extension of the existing, small, diesel-powered, five stops, rail line that connected the University with the Terminal station near the City centre (total: 11 stations). This design would extend the line North to the downtown core, and South to the Airport, connecting major suburbs. Although it required tunnelling into the downtown core, the North-South design was by far the cheaper option as it made use of existing infrastructure. East West: this option would see the construction of a brand new rail line (10 stations), mostly along or on the bus transit corridors. This option was more expensive as it required boring longer tunnels under the downtown core, but it had the greatest impact on traffic congestion and pollution. Digging tunnels undergound in Hollowdale presented known geological challenges. The risk of incidents such as sinkholes was estimated to be low, but possible due to the sandy terrain. The hills of Poud'nuf, north of Hollowdale, were known for their regular, but low intensity, seismic activity.

Options and cost estimates

The city council was facing two possible technical solutions:

A metro system: would carry up to 40k pphpd. Metro vehicles were typically more expensive to acquire than light rail vehicles, but carried more passengers.

A light rail system: would typically carry 10k pphpd, with a lower construction and acquisition costs

Steve Bright's (Mayor's adviser) back-of-an envelope estimates for the project acquisition costs were:

North-South: Metro: 1.8Bn construction, 200m rolling stock - total: 2.0Bn Light Rail: 1.2Bn construction, 125m rolling stock - total: 1.325Bn East-West: Metro: 3.250Bn construction, 250m rolling stock - total: 3.5Bn Light Rail: 2Bn construction, 125m rolling stock - total: 2.125Bn

The Mayor's view of the project

Mayor Jack Wassup was concerned: the city required a system with a 20k pphpd capacity, which was at the low end of the range for metro infrastructure. So, there was a concern that a metro might provide unused capacity, not enough bang for your buck. And the City could only, barely, afford a metro on the North-South extension. At the same time, light rail did not have the capacity required. A light rail on the East-West route would cost about the same as the North-South metro: investing in an infrastructure asset whose capacity would be saturated from the start seemed unwise, and insufficient to address the City's public transport needs.

The project also presented a political dilemma for the Mayor:

The North-South extension option was lower risk in terms of construction and costs, but delivered fewer political benefits for the Mayor: the ridings along the North-South corridor were safe seats for the Mayor and his team, and improving public transport there would not improve their political futures much.

The East-West option was higher risk as it was more ambitious, but it also served the greener, more affluent, Western suburbs were population growth was fastest. Wassup had campaigned with his "light rail on time, on budget" mantra at the last municipal election, and recorded significant gains in the ridings along the mooted route: the Mayor thought that further gains could be possible.

Hollowdale - the players (1)

Mayor Jack Wassup: Wassup had just been elected Mayor. He previously served as infrastructure minister in the provincial government, and had intimate knowledge of the processes and politics of public infrastructure funding. In the run-up to the election, and during his campaign, Wassup critiqued negatively the other leading candidate's plans for public transport, and declared that by the next end of his first term (four years), work would have begun on a new project, which would be delivered "on time, and on budget" before the end of his second term.

Mayor Wassup had two priorities: advancing the project in time for the next municipal elections in four years; keeping the budget within a 2bn envelope, which had been estimated by his adviser (Steve Bright) to be the maximum amount the City could afford to fund (with the assistance of higher levels of government), and had become a campaign commitment of Wassup. The public transport project was Hollowdale's largest investment in generations, and Wassup was keenly aware that such a high profile project would define his legacy as Mayor: this lead him to require his team to provide detailed briefings on every aspect of the project, and every major decision had to be approved by the Mayor's office. In particular, the Mayor's office was keen to be able to orient the public conversation about the project, and the public's perception of the Mayor (always an eye on the next election).

Hollowdale - the players (2) The Mayor's team:

City lawyers and consultants: Steve Bright had assembled a team of lawyers and consultants to assist the city in preparing for the bidding process. Their brief from Bright was to advise the city on contractual strategies that would cap the project costs to the 2Bn the city believed it could afford, and transfer as much of the financial risk as possible to the private sector contractors in order to minimize the city's exposure.

Municipal executives: the Manager of City Business (Mr Armstrong), and the Public Transport Manager (Mrs Leentrak) were mayoral appointees and long-time collaborators of the Mayor. They were tasked with looking after the money and monitoring the project.

Hollowdale - the players (3) Opposition Leader Mrs Showdry: Showdry was a conservative councillor, concerned about the costs of the project (keep local taxes low), and also the transparency and probity of the process. She argued that the Mayor and his team had close ties to property developers, and voiced concerns that the light rail design may be influenced to satisfy the needs of powerful political donors. The Mayor had been advocating for an East-West design for the project, whilst the opposition preferred the less expensive North-South design. Although Showdry and her fellow conservative councillors were a minority, their ability to impact provincial and federal elections in local seats was a concern for Wassup. Showdry could count on the support of fellow conservative elected officials, in particular the conservative provincial member of parliament for Hollowdale West, Rick Brown.

Chief MikMik: was the head of the local first nation. He was advocating for the project to provide opportunities for local indigenous entrepreneurs, and also the acknowledgement of sacred sites along the routes of the rail system.

Public Transport Users Association President, Bill Power. Power was a senior public servant in the Federal Government offices located in Hollowdale, and a public transport user. He was advocating for prioritizing public transport access for the most disadvantaged populations, in particular in the Eastern and Southern suburbs of Holloway, where immigrants, ethnic minorities, and low wage workers disproportionately resided. Power's advocacy had made him popular, and he was widely perceived to have political ambitions, which concerned Mayor Wassup.

Bus drivers: once the rail project was completed, the city was bound to lose about half of its 1,000 bus drivers, to be replaced by about 150 train operators. A large number of bus drivers were concerned about their jobs prospects, and only a few were hoping to make the transition to drive trains. This presented a challenge to maintain staff morale for Mrs Leentrack, Hollowdale's director of public transportation. It was feared that the younger drivers, and those with broader skill sets might see the arrival of the rail system as a signal to seek jobs elsewhere.

Hollowdale - the players (4)

Property developers: about a dozen major construction firms dominated the local market for housing construction and property development. The project was bound to transform how residents use public transport, and developers saw major opportunities to build lucrative luxury condo towers near the new transit stations. The project had been talked about for a number of years, and savvy developers had already acquired plots of land they hoped to build on, making a very tidy profit in the process. The Western suburbs, attractive to middle-class residents due to the proximity of good schools and green spaces, were their priority target: they had been frantically lobbying the municipality for an East-West design. It was rumored that Wassup had benefitted from generous donations from developers during his mayoral campaign.

Small business owners: small business owners, in particular in the retail and hospitality sectors had raised concerns about the impact of the project on their operations. They feared that lengthy construction works would drive customers away and disrupt their businesses. Another concern was the change of transportation patterns the new system would generate: some small business owners were concerned that they may have to relocate in order to adapt, and were afraid that higher rents near new transit stations would jeopardize their sustainability.

Hollowdale - the players (5)

Infrastructure and engineering firms: Most national and many international infrastructure and engineering consultants had a keen eye on the Hollowdale project. The project was perceived to be the first one of a new wave of infrastructure investment in the Country's major cities: winning the Hollowdale contract was an opportunity to burnish their reputation, and gain a favorable position for the other opportunities to come. A number of consortia between major players were being discussed as the prospect of the City issuing a request for proposals loomed closer.

Rolling stock manufacturers: they were also keen to come on board the Hollowdale project. Potentially, the project was an opportunity to showcase their capabilities to other potential clients. The capacity needs expressed by the City suggested that this was an opportunity to sell metro vehicles, though most manufacturers also produced light rail vehicles.

The Media: The new rail project had been a major point of the political campaign that saw the election of Jack Wassup a few months earlier. The new infrastructure project was perceived to be transformational and had attracted local, provincial, and even national media attention.

Hollowdale - the players (6)

The citizens of Hollowdale: there was a general consensus among the population that Hollowdale's public transport needed an upgrade. But past this agreed observation, a range of views were aired:

Public transport users wanted a faster, more comfortable system, than the ageing diesel buses in use at the time;

Residents from all neighborhoods wanted the new system to serve their community.

Some environmental groups were monitoring air quality in high traffic corridors, and were advocating for the establishment of an "Ultra Low Emission Zone" charging more polluting vehicles a daily fee (about twice a public transport fare) in order to enter the perimeter. Such groups often argue that those "ulez" fees could then be used to pay for the public transport upgrade. "like in London" argue the scheme's supporters.

Many motorists associations (and some populist politicians) disputed the environmental impact of ulez, and described the fees as a tax on motorists and small businesses. Most motorists viewed the proposed rail project as beneficial, as it would reduce traffic congestion, but would not support its funding through any kind of new "traffic tax"

Most homeowners in town welcomed the new public transport system, as they expected that property values would rise in neighborhoods served by the new system, along with quality of life. But this anticipation was tempered by a concern of the project's impact on city finances, and therefore property taxes (which were the municipality main source of income, after central government grants).

Hollowdale - the players (7)

Hollowdale Airport: The CEO of Hollowdale Airport Corporation had long been arguing that the lack of public rail transportation from downtown to the airport was detrimental to tourist and business traffic. "Without a rail link from the Airport to downtown, Hollowdale will continue to be a second-rate destination" he declared provocatively at the annual Chamber of Commerce Dinner, as he was furiously lobbying for the North-South extension.

Provincial government: the provincial government was supportive of the project. Mayor Wassup was the former infrastructure minister, and he maintained good relationships with the provincial Premier. Based on Wassup's request, the provincial government had agreed to fund 30% of the project, up to a maximum amount of 600m.

Federal government: the federal government was the largest employer in Hollowdale, as such they had a vested interest in the project's success. The federal government had agreed to match the provincial funding. 600m from the Federal Government, plus 600m from the Province provided Hollowdale with 1200m, and the municipality had the financial capacity to borrow another 800m in order to complete the project's funding (according to Mr Bright's advisers' calculations, this was the maximum amount the City could borrow without increasing taxes significantly).

Risk Management

Delivering a safe system was a concern for the City. The Mayor had sought advice from his consultants about the best way to ensure that passengers would be safe, and the City's reputation remained intact. One recommendation was to require compliance with the more stringent International safety standard, rather than the national standard.

Image management was a core concern of the Mayor. He had asked his lawyers about the PPP funding mechanism: "this term, partnership, does it mean I have to share the blame with contractors if something goes wrong?"

Lawyers had ensured that the 'partnership' was only a funding mechanism. There were ways to ensure that risks were transferred to the contractors: for example, contractors could be asked to sign off on the level of geotechnical risk they were ready to take, a frequent practice in infrastructure construction projects. Another advice was to separate the operations of the assets from the (contracted) maintenance: this way any cost escalation was borne by the contractor