Interviewer view · keep this screen to yourself

A value-for-money test: build it ourselves or use a PPP?

You run the case. Read the prompt, answer questions from the notes below, and share data only when the candidate asks for it or gets stuck. Score at the end.

Case timer

00:00

Target length:

1. Read the prompt aloud

Read it slowly, then pause. Let the candidate ask questions before they structure.

A regional government needs a new road. Option 1: build it itself for USD 100 million now and pay USD 3 million a year to maintain it for 20 years. Option 2: a PPP partner builds and maintains it, and the government pays USD 10 million a year for 20 years, reduced if lanes are closed. At a 5 percent discount rate, the present value of USD 1 a year for 20 years is about 12.46. Which option costs less in present value?

2. Answers to clarifying questions

This case has no scripted clarifying answers. Answer from the prompt, and say "assume what you think is reasonable" if the prompt does not cover it.

3. A model structure

Compare the candidate's structure with this one. A different split can be just as good if it is clean and fits the problem.

Compare the present value of each option's payments
- Option 1: build cost now + PV of maintenance
- Option 2: PV of availability payments
- Key: Then test risks that are not in the numbers

4. The working, step by step

Each step shows how a strong candidate works it out. Share a new fact from it only when the candidate asks or is stuck, and let them do the math: the result in the dark box is what they should reach.

Step 1: Option 1
What a strong candidate does: USD 100 million now plus USD 3 million a year times 12.46.
Present value of option 1 (USD millions): 100 + 3 × 12.46 = 137
Step 2: Option 2
What a strong candidate does: USD 10 million a year times 12.46.
Present value of option 2 (USD millions): 10 × 12.46 = 125
Step 3: Difference
What a strong candidate does: Option 1 minus option 2.
PPP saving in present value (USD millions): 137.38 - 124.6 = 12.78

The recommendation to listen for

At the end, say: "The CEO walks in. What is your recommendation?"

On these numbers the PPP costs about USD 12.8 million less in present value. But test three things. First, option 1 assumes no cost overrun; public projects often overrun, which strengthens the PPP. Second, governments usually borrow more cheaply than private companies, so the PPP must save through better building and maintenance, not through finance. Third, a 20-year contract is hard to change if needs change. Many governments run this comparison formally, often called a public sector comparator.

Score the candidate

Score each criterion from 1 to 5. A 2 or a 4 sits between the descriptions.

This case has no exhibit. Score Exhibit reading on how the candidate used the data you gave them: did they pick out the number that matters and say what it means?

Structuring

1: No clear structure, or a memorized framework that does not fit the problem.
3: A sensible structure, but with some overlap, a gap, or no clear priority.
5: A structure built for this problem, with no overlap and no gaps, a stated hypothesis, and a clear first step.

Math

1: Frequent errors, no units, or needed heavy help to finish.
3: Right answers but slow or messy working, or one error caught late.
5: Accurate and clearly narrated, with units, a sense check, and what the number means.

Exhibit reading

1: Read the chart aloud without finding the number that matters.
3: Found the key number but gave only part of the so-what.
5: Pulled the right number quickly and said what it means for the case.

Synthesis

1: Summarized what was done, with no clear answer.
3: Gave an answer, but with weak reasons or no next step.
5: Answer first, then two or three reasons with numbers, the main risk, and next steps.

Communication

1: Hard to follow: long silences, no signposting.
3: Clear most of the time, with some rambling.
5: Calm and concise, signposted each step, and checked in with the interviewer.

Total

0 out of 25

Score all five criteria to see the band and the feedback template.