Significance of Programme and Portfolio Management in Successful Delivery of Investment Programme

This report evaluates the significance of programme and portfolio management in relation to the successful delivery of an organization's investment programme. It discusses the importance of selecting appropriate projects, setting clear objectives and goals, and managing resources effectively. The case study of Crossrail is used to illustrate these concepts.

INTRODUCTION
The continuing demand for developing transportation infrastructure projects
is increasing day by day. This is putting tremendous pressure on public
sector for development. Transportation has been a main function of
government since long time. In the present scenario, it is difficult to manage
and fund mega transportation project because of the financial crunch. This
reduced the ability of government to implement big and unique projects by
itself. Project delivery is the method by which government encourages the
private sectors and other agencies for the development of infrastructures.
Transportation megaprojects include huge capital investment, expert and
competitive contractors, long period of time and a perfect delivery strategy
to deliver the project in time, quality and within budget. To make such mega
projects successful, a strong procurement strategy is required. A
procurement strategy is to develop a framework keeping in mind the
objectives and outcomes of the project. The contractual and commercial
strategy will be defined at the design and construction stage itself which will
align the project team towards achieving the objective. A good procurement
strategy will have a positive impact on project’s performance in terms of
time and cost.
Client dissatisfaction is always related to late delivery of project, over budget
and poor quality of work. This happens because less importance is given to
value for money. The Latham report (1994) proposed change towards more
collaborative culture. Partnering through the contract chain was seen as the
most efficient way. The Egan report (1998) set out five key drivers which are
important for the construction industry. They are committed leadership,
client focus, integrated processes and teams, a quality driven agenda and
commitment to people. This made a tremendous change in the industry.
Innovative approaches in procurement and other areas of construction are
encouraged. Value for money is given more importance than cost reduction.

This report is mainly focused on the procurement strategy in Cross-rail
project. Cross-rail is one of the biggest transportation projects in Europe.
Cross rail is the new high frequency, convenient and accessible railway for
London and the Southeast. The initial project value is worth £15.9 billion.
From 2018, Cross rail trains will travel from Maidenhead and Heathrow in the
west to Shenfield and Abbey Wood in the east via 21 km of new tunnels
under central London. It will link Heathrow Airport, the West End, the City of
London, and Canary Wharf.
Cross-rail obtained the Royal Assent in 2008. Cross-rail is divided into four
distinct sections. They are Central section, western section, north-eastern
and south-eastern sections. After Cross-rail starts operation, 24 trains are
expected to run per hour. This will add 10% to the transportation capacity of
London. Cross-rail will also reduce the journey time between many key
destinations of London.
CRL will be directly buying and managing a relatively small number of
contracts with Tier 1 contractors. They, in turn, will be buying a wide variety
of goods, works and services from many smaller suppliers and contractors
which form the supply chain for delivery. “Cross rail’s approach to
procurement is aligned with the UK governments achieving excellence in
construction principles, including a fair allocation of risk and reward, early
involvement of the supply chain, minimizing of interface risks, incentivizing
performance and selection of suppliers on the basis of best value” (NEC,
2009).
The management program and portfolios are essential in the progress and
the achievement of the organization's goals. The management portfolio in
the organization includes groups of different programs that are unrelated to
the organization. In contrast, the programs are projects in the organization
that is related in terms of functionality, the management needed, and
resources needed. The program management to a portfolio requires the

manager to understand the critical roles in the project and provide suitable
tools and equipment that are essential to meet the customers' needs and
achieve the organizational goals (Milillo et al., 2018). The program manager
is aimed to identify the project and establish the program plans that are
essential for the completion of the project (Black, 2017). In addition, the
management in the portfolio requires the manager to identify the projects
that are right to focus on based on the capacity of the organization's
leadership. The portfolio manager depicts the resources in the organization
and decides on the projects that can be done with the available resources.
The portfolio manager must make suitable decisions to do tasks that are
more valuable and essential for the organization's growth.
Assignment Objectives (Your Task):
LO1: Evaluate the significance of Programme and Portfolio
management.
LO4: Synthesise, the latest research on programme management
and portfolio management.
a. Evaluate the significance of Programme’s and
Portfolio’s and their management in relation to the
successful delivery of an organisation’s investment
programme. Justify your answer supported by evidence
from the literature and links to the case study (LO1, LO4).
The program and portfolio are essential in the investment programs as they
help facilitate the project's selection process. Investors must ensure that
they make a suitable decision while investing their money to ensure that
they gain the return on investment. Therefore, there is a need to select
appropriate projects according to the business goals, the likelihood of the
occurrence of risks, and the available resources. The decision-making

process needs to assure the investors that the income investors will provide
long-term returns on their investment. The evaluation of the projects should
be based on the most profitable decision to make on the project to work on
to ensure that the income is generated. The investors and the management
teams must select the project to provide the maximum benefits and deliver
maximum value to the organization, customers, and investors (Buck, 2017).
The most suitable technique to apply in the selection process includes using
the rankling method, where the projects are ranked based on their value.
The ranking method helps the management to set aside the resources
needed. The ranking method also helps select the projects that require less
income with maximum investment outcomes. The manager is not subject to
managing the tasks; instead to provides oversight of the pieces needed in
the project for the completion to be effective and efficient to meet the needs
of other related projects (Black, 2017).
Using the PPM technique to evaluate the projects is essential to ensure that
the organization gets the most comprehensive picture of the investment. The
program and portfolio management allow investors to make the right choice
on the critical infrastructural projects for the organization. For example, large
projects may take years to complete, and it may cost the management more
cash to invest with less income generation. Therefore, to ensure that the
organization makes the most significant income on their investment, they
must focus on the most comprehensive picture to make decisions that
provide the goal's achievement. Resources may dwindle, and more issues
may arise on large projects; hence the organization should be well
accommodative and well established in terms of resources, competency of
staff, and project management team for the success to be achieved in the
long run (St. John et al., 2017).
The programs and portfolios help the management teams to determine the
objectives and goals to focus on the important projects. 47% of the executive
reports show that most organizations fail on their projects due to the lack of
clear objectives and goals necessary for achieving the targets and used as a

milestone for the organization's success. The measure of the progress of the
invested projects is based on the objectives and goals that the organization
sets.
Therefore, in evaluating the success of the projects, it has to be compared
with the set intents and the purposes of the organization towards the
projects. The goals and objectives of the projects are like a plan; hence it
provides the direction and guideline in accomplishing the goals (Morgan,
2011). The project portfolio management helps the manager create an
atmosphere of concentration on achieving the objectives and goals. The use
of PPM techniques ensures that the approved projects in the organization
meet the set objectives and goals of the organization. In case risks occur in
the progress of the projects, the restructuring of dreams and planning has to
be made.
The PPM evaluation technique ensures that the approved procedures are
aligned with the strategies, and a standardized approach is achieved. The
competitors are the major hindrances in the project's progress; hence the
strategy has to be made to ensure that the defined functions to meet the
customers' demand are created. According to Morgan (2011), the program
and portfolio manager requires the management to develop strategies that
can be utilized to eliminate the redundancies in projects and leverage the
management teams to enhance the collaborative environment. The investors
have to be aware of the competition in the outside market; hence they have
to develop strategies to ensure that success is achieved. In addition, the
program and portfolio are essential in management to the resources in the
organization. The competitive advantage is achieved when the organization
is efficiently able to manage the organization's help. Resource planning is
essential to ensure that the resources are distributed based on the
requirement of the approved project, and the responsible management
supervisor is assigned to ensure that there is no wastage of resources. For
example, the PPM tools help connect the high-level portfolio data used to

assess the performance of the selected projects and the needed strategies to
be established.
SIGNIFICANCE OF PROGRAMME’S, PORTFOLIO’S AND THEIR
MANAGEMENT IN RELATION TO THE SUCCESSFUL DELIVERY
OF ORGANISATION’S INVESTMENT PROGRAMME.
Crossrail Delivery Strategies
Crossrail has procured a Program delivery partner and a Project delivery
partner. The project delivery partner is Bechtel, which is responsible for the
delivery of central section of crossrail. The program delivery partner is the
Transcend consortium made up from Aecom, Nichols Group and CH2M Hill.
Program delivery partner will be responsible for the overall management of
the project. (NCE, 2012) (Crossrail Delivery Strategy. Source: Michael A Kay,
p155, 2009).
Crossrail Program Delivery Partner
The role of Transcend is to coordinate throughout the project. Since the
crossrail project is split into many small contracts and small section of works,
the major function of program delivery partner will be to manage the
interface in merging the different components of work into a single and
efficient railway system. To achieve this, program partner will be working
closely with National Rail, London Underground Limited and Rail for London.
The program partner is also responsible for the work of stations which are
privately funded by developers like Canary Wharf Group and Berkeley
Homes.
The program delivery partner will be closely working with crossrail limited as
an integrated delivery partner. Staff for the program delivery team will be
chosen on the basis of efficiency and regardless of the employer. Integrating

the two teams in the early stage will be safe for the clients and risks can be
shared. In the later stage, if everything is running smoothly, CRL can hire
more of its own staff and can reduce the number of staff in program partner.
This will increase more in-house control. The role of program delivery partner
is very broad as compared to the project delivery partner. (NCE, 2012)
Crossrail Project Delivery Partner
The project delivery partner will be responsible for the delivery of Central
Tunnel Section (CTS) in which stations and systems are also included.
Bechtel will manage the procurement of all the contracts which will be
responsible for delivery of central section. Although the contract will be
between CRL and the contractors, the project delivery partner will be acting
on behalf of CRL. The CTS is very well defined and therefore will require
more traditional approach of project management. The main responsibilities
of project delivery partner will be implementation of engineering design,
managing interface within the central section, procurement, testing and
commissioning. (Michael A Kay, 2009)
Both delivery partners are expected to have strong inputs in finalizing the
procurement strategy. Both should make important decision like size of
contract and incentivization structure to get maximum output and quality.
Crossrail Stakeholders
Crossrail being a mega project will have many stakeholders. The table below
shows all the government and private stakeholders of Crossrail:
Stakeholder
Role
Department for Transport(DfT)

Co – Sponsor. Main interface to national government and HM Treasury
Transport for London(TfL)
Co – Sponsor. Main interface to local government, the Greater London
Authority (GLA) and the Mayor of London’s office. Owner of the central
section.
Crossrail Limited(CRL); previously Cross London Rail Links Limited(CLRL)
Delivery agent. Formerly a 50/50 joint venture of TfL and DfT, now a wholly
owned subsidiary of TfL. Main interface to the delivery supply chain,
including both the project and program delivery partners.
National Rail (NR)
Industry partner. Responsible for the operation, maintenance and renewal of
the National Rail network. Infrastructure manager of crossrail end to end rail
systems. Main interfaces to train operating companies (TOCs) and Freight
Operating Companies (FOCs).
London Underground(LUL); a TfL subsidiary
Industry partner. Responsible for the operation, maintenance and renewal of
the National Rail network. Infrastructure manager of the central section
stations, except Paddington. Main interface to the PPP and PFI LUL
contractors.
Rail for London(RfL); a TfL subsidiary
Operator franchising authority or shadow operator of crossrail. Infrastructure
manager of crossrail stations at Paddington, Isle of Dogs and Woolwich.
Docklands Light Railway(DLR); a TfL subsidiary

Industry partner. Responsible for the operation, maintenance and renewal of
the Docklands Light Railway transport system and for providing crossrail
limited(CRL) with access for proposed modification of the DLR
British Airports Authority
Owner of the Heathrow spur
Canary Wharf Group(CWG) and Berkeley Homes Group(BH)
Developers that have agreed to make contributions towards the cost of
stations at the Isle of Dogs and Woolwich respectively.
A program is a group of projects, which may or may not be related to one another, that
are managed, coordinated, and carried out collaboratively by an organization with a
specific goal in mind. Stated by (Lycett et al., 2004), program management is a
relationship between an organization's long-term goals and project delivery. On the
other hand, a portfolio refers to a program or project that is part of the same company.
These programs may or may not be linked. However, they must be part of, managed
by, and carried out by a single organization. Both programs and portfolios must be
pulled in the same direction to reach the final or desired organisational aim. The case
study of Crossrail is an excellent program illustration. Crossrail is the largest
infrastructure project not only in the United Kingdom but also in Europe. Programs are
only worthwhile if they are carried out to achieve a specific goal in the end, otherwise
they might waste time, energy, and other resources (Mossalam & Arafa,2016).
Program managers must clearly define the goals of all projects, develop realistic plans,
consistently pursue their implementation, optimize the allocated resources for each
project, ensure strategic alignment and realignment, and, finally, improve the quality of
the outcomes by providing leadership and direction as needed (Anantatmula, 2010).
For example, the Elizabeth line (Crossrail) was built to achieve the following: Enhance
and improve the mobility of people, products, and services across and around London

City. According to (Taylor, 2017), once the Elizabeth line is fully operating, the number
of train users in Central London will grow by 10%. Congestion on London's roadways
and subways should be reduced. With the ever-increasing population of London, an
alternative mode of transportation other than roads was required and Increase the
amount of connectivity between different parts of London and its vicinity.
This Crossrail system connects Reading and Heathrow Airport, and it extends all the
way to West London and Paddington.
According to (Taylor, 2017), the rail route will have ten additional stops, connecting
London's various regions.
Before, during, and after each project, organizations should conduct due diligence. This
is important in order to get the most bang for your buck. In 2001, Colins Buchanan and
partners were hired to conduct a cost-benefit analysis of the Crossrail project which is
crucial in determining and forecasting the amount of funding required for the project.
This is an example of how organizations should examine the initiatives and projects
they undertake. The Buchanan study was crucial in determining and forecasting the
amount of money that would be collected.
Buchanan and his colleagues had a challenge deciding whether to use London or
National value time for the basis of the analysis. In terms of cost savings, the benefit to
cost (BR) is enormous, determining which initiatives should be given priority above
others. Project managers should pay more attention to projects with a high benefit-to-
cost ratio. The BR study is also valuable for determining what needs to be done to
reduce costs and optimize returns (Worsley, 2011).
Economic impact assessment is another aspect that must be consider. As a result,
program and portfolio managers are responsible for guaranteeing that these financiers'
interests are protected. Organizations, particularly profit-making organizations, exist
primarily to maximize returns on investments, yet they do not live-in space. A concrete
assessment of the economic impacts that a given project or program has on the
surrounding area becomes essential and mandatory (Thompson,2005). Regardless of
how well-funded a company is, it still requires and deserves accountability for its

investment. As stipulated in the Crossrail contract, they must receive a fair return on
their investment. for example, Crossrail is funded by Transport for London (TFL), a
municipal government department, the Department of Transportation (DFT).
It is critical for the project and program managers to conduct extensive research before,
during, and after each project. They will identify which projects provide value and what
needs to be done to make those that offer less or no deals equally valuable.
Furthermore, project and program management (PPM) should be prepared to share
their study findings with future consumers and anyone else interested in completing
other projects and programs.
APPRAISAL FOR THE SIGNIFICANCE OF DEVELOPING AND
MAINTAINING A COMPREHENSIVE BUSINESS CASE FOR A
PROGRAMME.
4.1. Context
4.2. Delivery
4.3. People
4.4. Interfaces
The business case is essential in the project; hence it is a program that
needs to be justified before implementing the project. According to Williams
& Black (2018), a business case helps explain the possible undertaking of the
project with the highlighted benefits, risks, and cost of the implementation of
the project and alternative strategies and options to be undertaken (St. John
et al., 2017). The business provides the solutions to the risks when they
happen; hence it helps the implementation of the project to be done with
possible alterative when one fails. The business case contains the economic

analysis platform that is essential in analyzing the return on investment
based on the appraisal options provided. The commercial approval has the
sourcing
strategies and the procurement strategies to be used on the progressive
achievement and accomplishment of the project.
The business case also contains the financial issue that stipulates the income
flame of the organization and its affordability of the organization. The
management case includes the role's responsibilities through the
organization structure and the life cycle choice. The business case
provides an overview of the best decisions to undertake To achieve the
return on investment from the projects approved. According to Milillo et al.
(2018), the business case contains the do’s and the don’ts that the
management teams need to use to ensure that the progressive core
objective of the return on investment is earned. The business case brings
together the project appraisal with the suitable strategy to help realize the
invested project's benefits and the costs needed for the project to be
completed. The risks intended to occur are mitigated with the set risk
management strategies. For example, when the organization needs to
understand the cost, the development plan has to be created for the benefits
to be earned.
The business case enables the stakeholder and the investors to make
suitable decisions before investing in the project. The estimated costs and
the benefits are the basics of the project's progress. The benefits should be
more than the cost to ensure that the investors earn the return on the
investment. The stakeholders in the business use the business case as the
framework that is used to provide monitoring of the policy, strategy, and the
resources to follow after that in the implementation of the structuring of the
project. Therefore the business case provides the direction and the
guidelines on the steps to be followed for the completion of the project
without the incurrence of losses (Williams & Black 2018). The business case
has a section of risk management; hence, the management team is well

prepared for the uncertainties that may occur, resulting in the low progress
of the project. For example, the cross rail project has defined risk
management to ensure that the project does not delay and is completed
within the estimated and planned time for the organization.
The business case is critical to project's success; therefore, a program must be justified
prior to its implementation according to (Williams and Black, 2018). A business case
explains the feasibility of a project's execution including the advantages, risks, and costs
of the project's implementation and alternative strategies and options to be pursued (St.
John et al., 2017).
The business case developed during the Crossrail project's structuring was critical in
reducing the danger of project delays and abuse of funds. The cost of the cross rail was
anticipated to be £14.8 billion at the outset of the project. Nonetheless, once the
problem developed, the cost increased to £19 billion, demonstrating that the
management was well-structured with a defined amount of funds to cover the risks
associated with project implementation.
The business case combines the project evaluation with the most appropriate approach
for realizing the project's benefits and the costs required to finish it. For example, the
Crossrail business case is outline below.
• Context
The role of governance and the setting around the project make up the context of a
project. The procedural and cultural variables, like policies and regulations, required to
ensure a project's success are referred to as governance. The sponsors formed
Crossrail Limited to manage the project's construction. The Crossrail Act of 2008 kicked
off the project's construction. Prior to adopting the Act in July 2008, the Secretary of
State for Transport purchased the land needed to construct the rail system (Crossrail,
2019). Crossrail Limited was established to execute the project per the Act's
requirements. As the project's principal financier, the UK government had a specific goal

in mind: "to build a world-class railway that accelerates London's progress." They further
listed the project's fundamental values, including security, empathy, collaboration,
transparency, and innovation. Together with the sponsors' vision, these features created
a suitable atmosphere for Crossrail Limited to finish the task.
• Delivery
In project management, delivery refers to accomplishing the program objectives,
outcomes, and associated advantages, according to the Book of Knowledge. The
various types of delivery include scope, timetable, cost, risk, quality, and resources. The
Crossrail project has been a success thus far, despite substantial difficulties and
disappointments.
I. Scope
The new rail system will provide a plethora of benefits. The new rail system, according
to economists, will increase the country economically by 42 billion pounds. Businesses
will be able to meet with clients and suppliers more swiftly and affordably thanks to
more substantial road infrastructure, boosting their bottom line. The Elizabeth line train
connects to Heathrow, one of several of Europe's major airports. It is designed to
reduce travel time between Heathrow and the City of London by about 20 minutes.
Schedule
The Crossrail system operated on a definite plan. The construction began in July 2008
and was scheduled to be completed in December 2018. According to BBC London,
Crossrail's completion has been put back from October 2020 to March 2021. Between
2005 and 2008, was the phase consisted of crafting the bill and soliciting funds. Since
2009, the construction of tunnels and stations has taken the longest according to
Crossrail Limited's CEO, changes in design and design difficulties were some of the
challenges that impacted their timeline.
II. Financial Cost and Risk

The Crossrail program had a costing of 15.9 billion pounds at the start. The budget,
however, has changed throughout time due to a variety of factors. According to the
BBC, the cost had grown by 2 billion pounds to 18 billion pounds as of September 2019.
The program's weekly budget was in the region of £24 million, needing tight cost
control. To guide its financial expenditure, the Crossrail limited team set up a precise
cost-breakdown methodology. As a result, the team maintained productive relationships
with their contractors and suppliers.
On the other hand, the Crossrail project has run into financial and budgeting difficulties.
The project began during the beginning of the global financial crisis, which had a
considerable effect on supplier costs. The new current government in the United
Kingdom (UK) planned major national budget adjustments in 2010. All public-funded
infrastructure projects were compelled to apply cost-cutting measures due to the
evaluations. The study impacted the Crossrail project budget, which was increased from
14.8 to 15.9 billion pounds, the most recent cost estimate for the project is 19 billion
pounds, increasing construction costs by 28 per cent (Building News, 2020).
People
Any initiative or program is only as good as its people. Throughout the project lifecycle,
project managers must understand how to relate to and encourage team members. The
interpersonal and professional aspects of project management are categorized as
follows, Leadership, communication, conflict management, negotiation, and teamwork
which are examples of interpersonal skills, while the professional part refers to how
people should approach a project professionally. The Tunnelling and Underground
Building Academy (TUCA) was founded to provide the skills required for excavating and
developing system that protects because tunnel excavation requires a specialized skill
set (Dulake, 2011).
 Interfaces
According to the APM Book of Knowledge, project managers should be able to
communicate with professionals in a variety of fields, including legal, accounting, human
resources, and security. The project team has had good luck communicating with

people from many disciplines. According to the Crossrail project, pollution-controlling
emission controls were installed on 84% of the machines and equipment used in the
core section's construction. During the construction process, the team recycled nearly
all the removed material. 96 percent of the contracts were granted to local UK
enterprises to ensure the economy's long-term viability (Dodgson et al., 2015).
The business case supported the builders in ensuring that the cross rail's long-term and
primary goals were met. Crossrail is currently one of Europe's most ambitious and
successful projects. Careful planning, hiring of qualified employees, and crisis
management may have contributed to the project's success. The project's success has
also been aided by government sponsors who have provided cash and established
rules and regulations.
CRITICAL REVIEW FOR THE SIGNIFICANCE OF BENEFITS
MANAGEMENT AND ITS IMPACT ON PROGRAMMES.
Significance of Benefits Management and Its
Impact on Programme
Benefits management is involved with identifying and measuring the
benefits and tracking them from the start of the project to when the project
is completed. The benefits management this utilized until the realization of
the last projected use is achieved in the project's progress (Milillo et al.,
2018). The benefits management ensures that the organization has
stipulated realistic, achievable, measurable, and time-bounded benefits. The
benefits management outlines the tangible and intangible benefits in the
organization’s projects to be aligned with the fixed strategic investment to
ensure the adequate performance of the task is achieved. The benefits

management also includes the tracking benefits that help the manager
revisit the projects with the investors or the clients to ensure that the set
goals and estimated benefits are on track to meet the organization's
strategic objectives. According to Lawrence et al. (2018), benefits
management helps ensure that regular revisits are done. In case an issue
arises, new strategies are established to ensure that the organization meets
the results of the goals achieved in organization. There is also a need to
measure the period to accomplish the benefits with the available resources.
The need to ensure that the stipulated risks to arise are dealt with, the
company can decide on the time frame for the project to be completed and
earn the benefits. For example, the cross-rail project aims to ensure that the
rail has competed and suitable transports are done using the rail to deliver
products as the benefits. The changes that may occur in the project's
progress require the benefits to be earned in the long run as it is the core
achievement of the organization.
The impact of the benefits management on the program is to ensure that the
objectives and the strategic goals are achieved. The benefits management
ensures that the project schedule can be achievable to a stipulated period
that needs to be realistic. The general impact is that it leads to the
comprehensive achievement of the organizational goals essential for
diversity and the development of corporate benefits (Lawrence et al., 2018).
For the progressive achievement of the benefits for the organization, the
company needs to have a benefits management analysis that helps track the
progress on the earning off the honors to the organization. Regular research
is done for the benefits management to ensure that the investors have their
core goal to earn a
return on investment for a stipulated period. The cross rail project has to be
computed to ensure that the passenger’s journey across London is made to
ease the congestion and enhance connectivity for the transportation of the
products to enhance market connections.

 To analyse and observe on how the procurement
strategy for cross rail is developed to obtain value for
money.
As per the experts of the NEC contract, the greatest strength of NEC is that it
believes in partnering approach and at the same time adopts a project
management technique which is proactive. There are perhaps three ways
that this is clearly demonstrated in the NEC form. First one is the early
warning system. According to this system, early identification of problems
involved in the project and finding an early resolution is encouraged. The
early warning system says that an experienced contractor would have or
ought to have recognized the need to give the warning failing which, the
contractor will not be compensated for the issue. Therefore contractors are
encouraged to be active in early warning procedures so that any problems
arising in the future can be avoided in the initial stages and inadequate cost
recovery can be avoided.
“ Second, those risks for which the employer is not expressly responsible
under clause 80. 1 are risks for which the contractor is liable. Finally, the
target cost option most clearly reflects the early warning proactive
management approach by affecting the financial bottom line of the parties,
in particular the contractor” (Fenwick Elliott, p7, 2007).
3. 2. 2 Target cost contracts
In traditional form of contracts, a lump sum contract is used to carry out the
work on the basis of which contractor will be paid. This sum will only be
adjusted for the changes which will be done by employers or for any other
risk items which will be mentioned in the contract for matter such as design
errors. In this type of approach, the work will always be awarded to those
contractors who quote the lowest price to do the job. In the present scenario,
this type of procurement is highly discouraged and rarely practiced

especially in the public sector department where best value or value for
money is mostly preferred.
It is now usual in the public sector where best value applies for procurement
systems to provide for payment to the contractor based upon its recorded
costs. To make sure that there should be no cost overrun which will be
difficult to control in the future, a target for these costs is fixed at the
beginning stage. This target is adjusted in such a way that any changes
made by the employer and other price risk allocated to the employer under
the contract are taken into account. Incentives are given to the contractor so
that cost can be kept minimum. To ensure this, a gain share / pain share
mechanism is fixed at the initial stage of the project. The costs are recorded
and compared with the target cost. Any saving from the work will be shared
between the contractor and the employer in a pre-agreed manner. Same
thing happens when the recorded price exceeds the target price.
3. 3 Value for Money
Value for money is always beneficial to the client. It means that the project is
worth doing and is more refereed in business terms rather than financial
terms. Value for money is all about creating a better working environment.
The term value means to make sure that a right choice is made about
getting best balance of benefits in terms of cost and risk. Value management
is a defined and systematic approach for the analysis and development of a
project so that chances of achieving these requirements are increased and
value for money will be achieved. “ Value engineering is a continuous
process in which all the components and processes involved in construction
are critically appraised to determine whether better value alternatives or
solutions are available.” (OGC, Risk and value management, p7, 2007). This
helps in reducing wastage and managing all those inefficient processes
involved in the different stages of construction.

Value management is very important because it gives an option for
stakeholders to give their input in the project by encouraging more
participation, teamwork and end user buy in. The benefits which can be
obtained by following value management approach is more focus on
business needs, more flexibility to make the future needs simple, taking
stakeholders into consideration to get different views and developing more
options, considering various options by being innovative and creative,
prevention of unnecessary wastage and inefficiency and encouraging
teamwork to find solutions. (OGC, Risk and value management, p8, 2007).
Value management aims to maximize project value within time, cost and
quality constraints. However, sometimes extra capital expenditure is
required at the start of the project to improve whole life project value. It is
important that the value management method is based on the whole-life
cost of ownership instead of acquisition alone. “ Issues of health and safety,
sustainability, design quality, build ability, operation and maintenance and
disposal should all be considered during value management reviews and
evaluation of options” (OGC, Risk and value management, p9, 2007).
Departments should act as intelligent customers by discussing with suppliers
all the elements of the contract price including level of service, timescale of
the assignment, skill mix of the supplier’s team and how costs are to be
remunerated. Optimizing the cost of delivering a service or goods over the
full life of the contract rather than minimizing the initial price, introducing
incentives into the contract to ensure continuous cost and quality
improvements throughout its duration, aggregating transactions to obtain
volume discounts, collaborating with other departments to obtain the best
prices and secure better discounts from bulk buying is the best approach.
Developing a more effective working relationship with key suppliers to allow
both departments and suppliers to get maximum value from the assignment

by identifying opportunities to reduce costs and adopt innovative
approaches.
Benefits management entails recognizing, evaluating, and recording benefits from the
early stages of a project to the end. The benefits management is utilized until the
realization of the last projected use is achieved in the project's progress (Milillo et al.,
2018). The benefits management ensures that the organization has stipulated realistic,
achievable, measurable, and time-bounded benefits. The benefits management outlines
the tangible and intangible benefits in the organization’s projects to be aligned with the
fixed strategic investment to ensure the adequate performance of the task is achieved.
The benefits management also includes the tracking benefits that help the manager
revisit the projects with the investors or the clients to ensure that the set goals and
estimated benefits are on track to meet the organization's strategic objectives
(Lawrence et al., 2018).
The Cross-rail project aims to ensure that the rail is competed and suitable transports
infrastructures, are done using the rail to deliver products as the benefits. The initiative
will increase transportation connections, particularly those near the railway. They will
benefit from the railway's enhanced connectivity to several significant economic
districts. As a result, business activity will expand, resulting in more individuals
employed by these businesses. Increased business would also mean higher living
conditions for those who work in those enterprises (Kumar & Sharples, 2015). Better
accessibility to corporate locations will increase government revenue. On over 41 sites
around London, over 10,000 workers were already working during peak construction
(Roberts et al., 2015). As a result, the project is already acting as an employer,
providing employment to unemployed adolescents, and increasing their incomes. As
indicated before in the introduction section, such operations are expected to boost the
country's GDP by £20-42 billion pounds. The project will allow for more housing and
economic development. It assists in the regeneration of the railway corridor. As new

business opportunities arise, housing will expand to accommodate the individuals
employed by such enterprises. More than 90,000 new dwellings are expected to be
delivered due to the new line (Lawrence et al., 2015).
Conclusion
The cross rail project aims to serve the people in London to ease the
congestion and
enhance connection. The project is estimated to be cost £18.8bn to cater to
the need of the people in London. The program management and the
portfolio were necessary to ensure that the resources provided met the
completion of the project with enhanced efficiency and time management.
The benefits management team of the cross rail project requires the project
to be achievable at the estimated time and ensure that the strategic goal of
easing the congestion off passengers is achieved. The project has to be
effective and ensure that the organization's objectives are committed to
enhancing the long-term benefits to the people living in London and the
outside territories. The business case formulated in the structuring of the
cross rail project was essential as it helped minimize the risks of delay of the
projects and misuse of funds. At the start of the project, the cross rail had
been estimated to cost £15 billion. Still, as the issue arose,
the cost rose to £18.8bn, showing that the management was well structured
with the set amount of funds to cater to the risks that occur on implementing
the projects. The business case helped guide the constructors to ensure that
the long-term goal and the cross rail's core goal are achieved.
The time it takes to travel between London and its vital commercial centres will be
reduced. In other words, the new route will relieve congestion in existing transportation
networks by providing more travel options for passengers. Furthermore, economists
believe that the new rail will contribute 42 billion pounds to the UK economy (Kumar &

Sharples, 2015). Businesses would benefit from the upgraded transportation network
since it would make it easier and less expensive to travel across London, increasing
their bottom line. Accessibility will benefit not only enterprises but also education and
other occupations. The Crossrail system connects to Heathrow Airport, one of the
busiest airports in the United Kingdom cutting travel time to London City by roughly 20
minutes. The project's completion would be a triumph not only for London but also for
the United Kingdom. To protect it from the negative consequences of Brexit.