END-USER ORIENTED PUBLIC-PRIVATE PARTNERSHIPS IN REAL ESTATE INDUSTRY

International Journal of Strategic Property Management, Mar 2008 by Majamaa, Wisa, Junnila, Seppo, Doloi, Hemanta, Niemist�, Emma

2. END-USERS PERSPECTIVE IN PPPS

According to the World Bank (2007), benefits from PPPs can be achieved in four main areas: increasing efficiency in the execution of projects; enhancing implementation capacity; reducing risk for the public sector; and mobilizing financial resources by freeing scarce public funds for other uses. At the same time, the extent of benefits from private sector participation, and public authorities' uncertainty of the quality of PPP services have also been criticized (Shaoul, 2005; Kuntaliitto, 2003). The use of PPPs have been mainly justified by invoking international experiences of its benefits compared to the traditional public service production (Nisar, 2007; Zhang, 2006; Earl and Reagan, 2003; IPPR, 2001), but they have not widely considered the context of end-users' participation and perspectives (Ahmed and Ali, 2006; Kaya, 2004; Akintoye et al., 2003).

International studies have been mostly regressive, and concentrate on technical and economical issues, public sector benefits (Shaoul, 2005; Edwards and Shaoul, 2003; Gaffney and Pollock, 1999; Tiong and Alum, 1997), and analysis of the risks of cases and the contracts (Nisar, 2007; Abednego and Ogunlana, (2006); Grimsey and Lewis, 2002; Thobani, 1999). In the field of property development and service production, benefits of PPPs have traditionally measured by using "Value-for-Money" (VMF) as a key-object (EIC, 2003; HM Treasury, 2003; European Commission, 2003b; TTF, 2000). In evaluation processes, based on VFM, the benefits of partnerships are attributed to the participation of the private sector which has better capability and innovation in (HM Treasury, 2004; EIC, 2003; European Commission, 2003a; Grimsey and Lewis, 2002; Treasury Taskforce 1997a and 1997b):

- Controlling risks;

- Design and Building;

- Maintenance of the property;

- Operating assets; and

- Creating third party cash flow.

There has also been a gap in understanding the importance of the influence of the evaluation process and evaluation criteria on service production. While customer-oriented development of public services and the needs of end-users have been noted as the crucial points in innovative development of today's public services and welfare society (Trentmann, 2007; Brunila et al., 2003), the implemented evaluation process and the evaluation criteria have not been developed from the end-users' point of view (Mattar and Cheah, 2006). Thus the purchasing process and evaluation of proposals, from the end-users' point of view can be seen as an important part of the public service development based on PPPs.

3. RESEARCH DESIGN

The research aims to examine what an evaluation process of PPP with customer-oriented evaluation criteria could be in practice. Based on multiple case studies, a theoretical framework has been devised to integrate the end-users in the PPP development process. The advantage for the end-user is based on the author's previous research into PPP from the perspective of a group of rational consumers with individual needs (Majamaa, 2004 and 2005). In the literature, the theory and behaviour of rational consumers is not unambiguous, and has been examined from various scientific perspectives (Miljkovic, 2005; Abell, 1996). However, what are common to the economic and behaviourist theories of rational consumer behauvior (Zafirovski, 1999; Varian, 1996; Rohlf, 1996; Heap et al., 1992):