Identify the governance failures that may have contributed to failure and ultimate termination of the Home Insulation Program and describe how, in hindsight, the governance of the project may well have been improved such that the outcomes that contributed to the fraud, deception and the fatal accidents may have been prevented.
Background of the Home Insulation Program
The home insulation plan was a government initiative plan which was announced on 3rd February 2009 as a part of Commonwealth Government’s Energy Efficient Homes Package. This home insulation and plan was the main part of the Energy Efficient Homes Package with a budget around $2.8 billion (Hawke 2010). The main reason behind starting this project was the 2008 global financial crisis which created vast amount of unemployment in Australia. As per the Australian government this home insulation program was able to generate some low skilled job with having the aim of improving Energy Efficiency in residential buildings (Dollery and Hovey 2010). The first phase of this home insulation program was assessed by the Department of the Environment, Water, Heritage and the Arts (DEWHA) and was completed successfully. In the second phase of the home insulation program several quality and safety concerns raised, which was the main reason behind failure of the project and due to that home insulation program terminated prematurely before the completion date.
In this report various of governance failure that might have contributed in the home insulation program project failure will be analysed and discussed. Following that how the Governance of the project may have been improved such that it prevented fatal accident, deceptions and fraud will be discussed.
In the home insulation program there were various of mistakes made by the Australian Government regarding the best practices of the governance framework. The first mistake done by the Government was regarding the policy making process.
The first mistake which was done by the Australian government was preserving policy goal instead of ensuring adherence to policies, standard and guidelines. Here the policy taken by the government was totally wrong as their main policy goal was using the home insulation program for responding to the GFC as an economic stimulus tool. Also, this home insulation program was treated as a way of green credential establishment. Due to this major policy goal of the home insulation program the initial policy goal of the home insulation program was unaffected by the policy making process (Griggs et al. 2013). From the Hawke review it has been assessed that the process of insulation did initiated some changes in the program but the safety area of this program not assessed properly which becomes crucial in later stages. Thus the main problem here was with the objective of the government which was quick home insulation process and due to that some major operational problem occurred.
Governance Failures in the Home Insulation Program
The second governance failure that contributed in the termination of the home insulation program was failure in establishing proper governance roles, responsibilities and authorities. This project was comparatively one of the big and important project in Australia and for this type of extremely important project relatively unskilled contractors were hired and that is one of the major project governance failure. Hiring the unskilled contractors not only lead the project to a permanent termination (Meyer 2018) but also this project governance failure done some considerable damage to some reputable organizations. Various of compensation was paid to the involving organizations with this project and most of them were the contractors and this was a huge loss for the Government. Due to this governance failure the main negative outcome from the project was poor quality of workmanship and bankruptcy of various installation firms (Shittu et al. 2013). Also, the potential jobs that created during the home installation project was short lived as the project was terminated prematurely. Very soon there was doubts about achieving energy efficient targets of the project as insulation was removed from several houses due to the safety related issues. Thus partially program objectives were achieved from this project but the overall negative outcomes from the project lead this project to permanent closure. Thus here the project governance failure of establishing the governance roles made a big mistake.
In this context another project governance failure was the monitoring the performance. In this context the project governance structure of the home insulation program failed to monitor the performance of the project team (Costa et al. 2013). In the first phase of the home insulation program the payments were directly made to the householder following the implementation of the insulation program. The eligibility criteria for installing the insulation program was assessed by Department of the Environment, Water, Heritage and the Arts (DEWHA). Initially there was no issues found with the first phase of the installation of home insulation program. In the first phase the performance monitoring was also good of the project governance. In the second phase of the home insulation program the structure of the project governance was changed as there was changes in the payment process (Hanger 2014). In the second phase the payment was directly made to the installer rather than the householder. There was also some changes in the project governance structure due to the quality and safety concerns. In later cases it has been seen that there is a large number of claiming of potential fraud issues with addition of safety and quality issues. With the time this situation become worse and project governance structure was unable to recover from this situation (Muller 2017). Later it has been assessed that there was a fault in the project governance of the home insulation program as performance of various stakeholders and other related firms were not assessed properly. Frauds and quality related mistakes has been done during the installation process but there was no escalation from the side of Government which clearly shows the performance monitoring related issues in the project governance (Garg 2013).
Improvement of Project Governance
There are several of ways of improving the overall project governance of a project. For the home insulation program it has been seen that there was many frauds happed during the installation process and also several fatal accidents were happened. It has been assessed that there are several ways of improving the project governance which can prevent this type of frauds and fatal accidents. The main things that are able to improve the project governance are discussed below.
- Roles and Responsibilities: For a perfect project governance structure there should be a clear demonstration of individual’s roles and responsibilities with the expectations of the organization.
- Purpose and Strategy:Clear vison of the purpose and strategy is very much important for an improved project governance (Too and Weaver 2014). Here the role of executive committee is very much important for setting purpose, visons and strategy of the organization.
- Organizational Performance: For a better and improved project governance appropriate performance indicator and categories need to be determined for the organization (Dobre 2013). Thus improved project governance will be achieved through the assessment of performance indicator and categories.
- Organisational Maturity: Also for a more improved project governance structure the capabilities and the capacity of organization must be increased.
- Engagement: A proper engagement with the stakeholders are very much important for improving the project governance structure.
- Culture and Ethics:Culture and ethics are very much important concept for an improved type of project governance structure (Hogan and Coote 2014). Thus responsible and ethical type of decision making is needed throughout the implemented organization.
- Structure and Composition:Structure and the composition is one of the most important part for the perfect project governance plan. For a good structure and composition right group of people should be working at their expertise area. The expertise area of the employees depends on the skills and experiences gathered by a particular employee on that field.
- Risk Management:The project governance scenario can be improved by a proper risk management (Glendon and Clarke 2015). By the assessment of risks and managing this risks using internal controls organization will be able to deliver on their purposes which makes the project governance more improved.
- Accountability: Accountability is also important for improving the project governance. Accountability ensures that there is a flow of information to the decision making board (Kerzner and Kerzner 2017). It also creates transparency to the employees of the organization about the flow of information. Thus it becomes an important part for improving the project governance.
From the above discussion it can be concluded that following the project governance structure is very much important concept for successfully complete a project. In this paper discussion has been done on the home insulation program of Australia which has become a failure due to improper type of project governance. From this project it has been assessed that due to improper project governance structure the home insulation program has faced issues such as fraudulent and fatal accidents. From the brief discussion it has been also understood that the project of home insulation can be designated as the failure of the government itself. Most of the observers states that the project of home insulation program was a total blunder. Most of the study regarding the home insulation program pointed out the flaws that was present in the project governance model of this project. In this paper also the project governance failures has been identified that has been contributed in the ultimate termination of home insulation program. Following the discussion of governance failure in home insulation program how the governance of the projects can be improved has been identified in this paper which will be able to prevent against several fraud and fatal accidents.
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