Capital Programs and Amalgamation: Key Focus Points for Councils

Insights | 19 October 2020

Far from the traditional assumptions about what small government does and how it operates, local councils are constantly juggling new challenges in order to appease their customers, deliver projects on time and balance their own bottom line.

Those challenges have been exacerbated thanks to the widespread disruption of COVID-19, but unlike some non-essential services, local councils can’t simply stop operating.

PM-Partners has spent more than two decades working closely with a range of councils across New South Wales and Victoria, and we understand that now – more than ever – they must equip themselves with the right training tools and expertise to function in a post-COVID world.

Navigating large capital programs

Local councils are undertaking massive capital programs on a scale unlike anything we’ve seen before. The new Western Sydney Airport is a clear example of it, with the $5.3 billion international terminal expected to start construction in 2021.

Think about all the issues they have to deal with on a day-to-day basis: capability requirements, planning and strategy, availability of relevant tools, stakeholder management, and even who they are partnering with. It’s difficult enough on small projects, but with so much on the line (in terms of both financial and delivery expectations), there’s no room for error – so local councils must be fully trained from the outset.

A call for help from local councils

These councils – and indeed any local council managing large capital programs – need expert help or they run the risk of the entire project falling apart. For large programs in particular, the risk profile is sky-high.

Consider Liverpool Council’s massive new development project that is expected to deliver Sydney’s third CBD. The two-stage project is currently worth in excess of $400 million and is critically important because half the population of Greater Sydney is expected to “live west of Parramatta by 2036”. Flexible and scalable project management planning will be key to their success, especially for such a long-term operation.

Finding operating rhythm post-amalgamation

Beyond the significant financial hurdles of large capital projects, we’re also witnessing a new dawn of the ‘combined’ council.

There are a number of reasons why two or more local councils may decide to – or be forced to – amalgamate their operations. Back in 2016, NSW saw 19 council amalgamations take place, down from 35 amalgamations that was initially floated by the state government.

While disruptive at the time, the upside is that – for the most part – these amalgamated councils have been on track to hit their targets. But there are still considerable challenges ahead.

We’re hearing from a number of merged councils who are still dealing with integration issues, sometimes years after the merger. The question we always ask leadership is: what do you want to get out of this amalgamation? Aside from overarching benefits for their communities, the answer is invariably about internal wins. They want greater efficiencies, more synergy, improved IT systems, better organisational structures and processes, and of course a more positive and cohesive team culture.

Training can ease the challenges of council amalgamation

It’s an ongoing challenge to maximise the benefits for an organisation, especially one as complex as a merger of multiple local councils. That’s why business advisory services such as P3M3® assessments can provide a framework within which a council’s current performance can be measured and planned for future improvements.

At PM-Partners, we understand the nuances of local council. We also have decades of expertise in mergers and acquisitions, and we’ve helped many councils create a balanced merger framework that will set them up for success.

To find out more about how you can better manage large capital programs or improve the chances of an amalgamation succeeding, contact the experts at PM-Partners or call us on 1300 70 13 14 today.

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About The Author

Pat Guthrie, Lead Transformation Consultant at PM-Partners

Pat has 20+ years’ global experience in delivering large scale complex, multi-million-dollar transformation programs. He has worked across various industries including banking, insurance, retail, transport, aviation and utilities. Pat has established and delivered programs for international blue-chip organisations, medium size enterprises and various government departments and statutory organisations.

Advising, facilitating, supporting and overseeing large-scale enterprise-wide transformations, Pat adds value to Executives and safeguards acceleration of business transformations. As Lead Transformation Consultant, he will focus on developing and instituting solutions to complex client issues that can be scaled across the enterprise, creating, developing and supporting structures for innovation and delivery of transformation programs.

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