Delivering integrated solutions in the public sector: The unbundling paradox

The paper analyzes changes in suppliers' organizational structures to deliver integrated solutions by examining the bundling across different project phases with a focus on realizing risk transfer and through-life innovation. A multiple, longitudinal case study method is used to examine changes in integrated solution provision in Public Private Partnerships over a 15-year period. The study deploys rich data sets by combining 108 government reports with 38 interviews. Findings examine organizational transformation and suggest that as a response to the need to be competitive the solutions provider ‘unbundles’ the bundle of integrated solutions by creating sub-units to handle distinct phases. The paper questions whether bundling the different management and procurement phases of a major project into one contract is appropriate. Managers must weigh the transactional cost savings of dealing with a prime contractor against not only the transactional costs of dealing with distinct contractors for individual phases, but also the comparative ability of the two options to deliver.