No more decorating bookshelves

Asset management plans are not new. If you look on the bookshelf of any asset manager, you are likely to find at least a decade’s worth of plans gathering dust. But change is coming. The era of the asset management plan as write-only memory is ending and a new era is beginning with the asset management plan becoming the firm basis from which infrastructure-related business decisions will be made. A large US water utility is at the forefront of this transformation.

The idea of the asset management plan is inherently appealing. It promises a vision for how an enterprise’s assets will be maintained and enhanced over time. Unfortunately, these plans have failed to deliver for three key reasons: effort, timeliness, and transparency.

One of the biggest barriers to asset management is the effort required to construct an asset management plan. The process can be daunting, with some organisations ramping up for the next year’s plan the day they deliver the previous one. And most of the effort is boring and repetitive, such as data extraction, data cleansing, spreadsheet manipulation, document formatting and version management. The process is so effort intensive, that there is little time left over for creative thinking or the evaluation of innovative options. And there is definitely no time for continuous improvement.

LACK OF TIMELINESS

Too often, asset management plans are created but do nothing more than decorate bookshelves. The primary reason for this is a lack of timeliness. By the time the plan is delivered, the data it was based on is out of date, usually by at least three months, but sometimes by as much as a year. The organisational
awareness of this failing undermines belief in the findings of the plan. It doesn’t take many issues to completely relegate the plan to gathering dust.

All it takes is a few instances of maintenance staff or contract personnel being sent out to rehabilitate or replace assets that have already been replaced due to emergency conditions. These stories percolate through the organisation and turn the asset management plan into a painful joke.

Timeliness isn’t the only reason organisations lose faith in their asset management plans. There is also a significant failing by these plans to deliver the necessary level of transparency from the recommendations back to the detailed inventory information. This transparency is lost in the chaos of inter-related spreadsheets and approximations. And without that transparency, any unattractive truths about the current state or future requirements of the assets are easy to dismiss as speculation or errors in assumptions.

Effort, timeliness and transparency have been undermining asset management plans since they were first introduced as part of asset management best practice, but some organisations are finding a way past these issues. The key is asset-based planning. That may seem obvious – after all, they are called “asset” management plans – but one of the first things to be lost in these plans is the connection to the organisation’s actual assets.

INCONVENIENT SCALE

This is driven by one primary factor: an inconvenient scale. Most organisations own hundreds of thousands to millions of assets – so many assets, that using the detailed data in a plan is not just daunting, it is overwhelming. Spreadsheets become unwieldy at 20,000 assets, let alone when they are asked to manage 200,000 individual pipe segments. So, asset managers start approximating, grouping assets into categories and abstracting the knowledge until the through-line from asset to investment is lost.

When the problem with a process is scale, automation and software can help. That is why asset management planning is ripe for automation. It requires software to operationally manage the work orders for the organisation’s assets, so of course it will require software to build individualised plans for each of those assets and then aggregate those plans into an overall, documented approach.

This may seem obvious; it did to me when I launched Riva software 11 years ago, but historically, planning groups have not been given the resources necessary to build or purchase software solutions. Instead, they have been asked to deliver increasingly complex planning documents with sweat and spreadsheets.

To overcome the effort barrier, software can apply standardised business rules to individual assets and generate forecasts for level of service, costs and risks. This requires a methodological shift within the organisation from forecasts based on asset classes to capturing the detailed business rules for managing assets.

To overcome the timeliness barrier, software needs to be integrated into the organisation’s operational systems. This integration can ensure that the data used in the plan is as close to real time as possible on the day the plan is generated. Moreover, integration and automation can support continuous regeneration of
the plan, identifying intra-year changes to the plan before they become embarrassing anecdotes.

To overcome the transparency barrier, software needs to maintain the link from enterprise level budget and risk forecasts to the individual assets that make up those forecasts. All it takes is a few examples where a decision maker drills from a high-level number down to a detailed asset record for confidence in the numbers to be established. The rigour required to maintain this transparency becomes immediately obvious to decision makers, and eventually to the entire organisation. This rigour rebuilds organisational faith in the planning process.

So, how do you take your asset management plan off the bookshelf, shake off the dust and transform it into a living document? Recently, a major US water and wastewater utility (the utility) needed to answer that question. In response to growing asset management challenges, it had invested heavily in research into prioritisation of asset replacements. Unfortunately, the effort required to apply this research to the plan was resulting in high, ongoing consultancy fees and a lack of timeliness and transparency in the delivered plan.

‘HOPED FOR THE BEST’

The complexity of the solution also meant that it found it increasingly difficult to implement any improvements in the methodology without breaking all the inter-related analysis steps. Because of this, the utility started a multi-phase process of detailing its automation requirements and then searching the marketplace for a solution. What it found was not encouraging. The available tools were narrowly focused on individual asset types, stand alone and inflexible. In the end, it put all its requirements in a Request for Proposals (RFP), issued it and hoped for the best.

That process led to the selection of a leading provider of asset management solutions. The utility worked with the vendor’s staff to transfer its research and business knowledge from all those spreadsheets and MS Access databases into the software. After four months, it successfully generated a duplicate of
the plan it had produced manually the previous year. Three months later, it had started to transform that approach to implement an enhanced process and generated its prioritised replacements for the next year.

Moving forward, the utility is using this new living asset management plan as the basis for rapid, continuous improvement of its asset management process. It, and other organisations like it around the world, are starting to see the value that asset management plans have so long promised and so often failed to deliver.

Ian Woodbury is chief executive officer and founder of Riva Modeling Systems, an infrastructure asset management software provider