Three steps to maximise value from infrastructure investment for programme sponsors

Although job titles may vary, the responsibility of the sponsor role includes securing project funding, owning the business case, determining the right solution and delivery approach, and ensuring that benefits are delivered. But infrastructure projects and programmes – and by extension people in sponsor roles – face numerous challenges, including:

• Increasingly high expectations of infrastructure
• A significant gap in public investment
• Oversubscribed capital budgets across every sector.

However, the sponsorship profession has not yet developed consistent skills and capability frameworks to guide sponsor development as they tackle industry challenges. The results of our recent cross-sector sponsorship survey, undertaken with the Major Projects Association, suggests that few organisations have a common understanding of the sponsor role or a clear career pathway. Survey results showed that:

• Half of respondents in a sponsorship role did not recognise it as their responsibility to resolve funding constraints, despite it being a fundamental part of their role.
• One in four respondents said they lack the skills to deliver the most pared-down solution that meets the client’s requirements (often defined as the Minimum Viable Product, or MVP), and nearly two-thirds are not confident in their ability to secure alternative funding.
• Fewer than one in five sponsors feel strongly that their organisation has the right training, policies, processes, and incentives to develop an MVP solution properly. This falls to fewer than one in ten for the ability to identify and secure alternative funding.

It appears current organisational support systems are not going far enough. In turn, the lack of capability is limiting organisations’ ability to deliver the right infrastructure outputs at an affordable cost.

What tangible actions can organisations take to improve how their sponsor teams work to improve the delivery of their objectives?

Insights derived from our recent industry sponsorship events, combined with survey results and experience of successfully sponsoring multi-billion-pound programmes suggest there are three key steps organisations need to take to build their sponsorship capability.

Step 1: Create the right mindset – Challenging yet psychologically safe

A crucial responsibility of a sponsor is to steer a project or programme towards the most appropriate solution and delivery approach, aligning desired outcomes within the available budget and constraints. It’s therefore critical to create an environment where challenge is accepted and encouraged, empowering project professionals to take risks without fear of significant censure or penalty. There should be a healthy tension between project sponsors, who handle uncertainty and provide challenges, and programme or project managers who seek certainty and focus on delivery. Together, they are positioned to test and refine potential solutions consistently. We’ve seen the importance of psychologically safe environments and how they drive team performance on major schemes through our work with the Ministry of Defence. Practical ways to instil a challenging yet psychologically safe environment include:

1. Setting and communicating a clear and compelling vision: Establish and communicate a clear hierarchy of objectives aligned to a compelling vision. Alignment and clarity of objectives early on ensures stakeholders understand what the project seeks to achieve and provides a space to explore a full range of potential solutions.
2. Prioritising behaviour over process: The Department for Transport’s Lessons from transport for the sponsorship of major projects highlights the importance of positive behaviours such as making evidence-based decisions, prioritising relationship-building, and displaying healthy scepticism by asking questions when technical information is unclear.
3. Being a role model for the desired culture: Includes proactive and transparent communication with project teams about progress and risks, whilst maintaining positive but challenging relationships across the project community.

Step 2: Develop the right tools – A proactive, value-based approach to design and delivery

Infrastructure schemes can be delivered in many ways, with multiple options on scope, timing, funding, and commercial approaches. But in the pursuit of rapid progress, projects, and programmes often default to standard assumptions and acceptance of both stakeholder requirements and corporate standards without question. This works until funding or other constraints arise, which forces a reactive approach to consider alternatives.

Instead, sponsors should embrace optionality as an opportunity to identify the optimal value-for-money approach and what represents the MVP. Sponsors need to resist calls from delivery teams to lock down scope too early, which feels efficient, but prematurely closes opportunities to enhance affordability and value – and leaves the project or programme exposed to future challenges. Key approaches for sponsors include:

1. Understanding the links between outputs and value: Using tools such as ‘Theory of Change’ can illustrate the logical link between activities, outputs, and desired outcomes. This approach enables project teams to understand how different outputs influence outcomes and benefits and identify which requirements can be relaxed or removed while maintaining value for money.
2. Developing the capability to undertake rapid optioneering: The complexities and interdependencies of infrastructure projects can make it difficult to isolate the cost and value impacts of specific scope items. However, these impacts can be assessed by comparing different options through a targeted optioneering process. The process should be swift and high-level to maintain momentum and speed up decision-making, whilst avoiding the trap of turning into a detailed design exercise on technical options that do not impact the outcomes decision-makers care about.
3. Embracing transparency to build confidence: Sponsors can build confidence by clearly presenting trade-offs between a range of options, setting out the level of risk and uncertainty, and enabling senior decision-makers to interrogate the evidence and come to their own conclusion. This approach also highlights when project-level decisions are based on assumptions that misalign with organisational priorities, allowing adjustment to ‘critical’ requirements if significant cost savings are possible.

Step 3: Build the right skills – Develop sponsorship functions with appropriate capabilities

The term ‘sponsor’ is often poorly understood or used to describe different roles. Many performing sponsorship functions are ‘accidental sponsors’, unaware they are acting in this capacity. This contributes to a lack of consistency in approach and variability in skills and capabilities across the industry and results in inefficiencies during the planning, design, and delivery of major projects and programmes.

The Major Projects Association, Association for Project Management, and Project Management Institute have committed to address the ‘sponsorship capability gap’. In the interim, there are steps organisations can take to ensure their sponsorship functions have the right skills, including:

1. Clarifying where the sponsorship function sits within the project or programme structure: The term ‘sponsor’ is widely recognised across the transport sector and within central government departments and agencies. But it’s less commonly used in the regulated water and energy sectors. Clearly defining who holds responsibility and accountability for this function significantly enhances the likelihood that sponsors fulfil their role in driving project success.
2. Attracting sponsors with the right capabilities: Good sponsors apply logical, concept-based judgement – often referred to as ‘common sense’ – across various domains. Hiring for this attribute can be difficult. Instead, organisations should tailor their role descriptions to attract inquisitive people, who excel at relationship-building, and are comfortable with ambiguity, and encourage the development of these attributes in their sponsor teams.
3. Developing the core sponsor capabilities: Organisations should encourage and support sponsors to develop their capability in key areas. Our research suggests these include understanding organisational priorities to achieve long-term programme outcomes; concise, big-picture messaging; critical thinking; and technical, commercial, and financial acumen.

Our experience, supported by our survey results, suggests a considerable proportion of project and programme professionals feel ill-prepared to navigate the infrastructure sector’s current pressures. Nevertheless, we believe organisations can significantly enhance their delivery capability and effectiveness by establishing robust and effective sponsorship functions – a crucial component in solving the sector’s future challenges.