Asset Management Plans    Asset Management System    Data Capture
Asset Management Reviews    Internet/Intranet Solutions    Risk Management

Asset Management Plans

• Reduce the life cycle expenditure on the existing asset stock by improving maintenance strategies 
• Improve asset utilisation and resource allocation to better target management plan priorities 
• Improve asset management performance by ensuring a link between the management plan objectives, maintenance levels and the asset stock retained. 

• Manage risk to acceptable levels. 
• Ensure that new capital works are subject to strategic asset evaluation techniques such as service strategies, economic appraisal, and examination of non-asset solutions, life cycle costing, and energy management and performance measurement. 
• Establish what needs to occur to establish a decision support system that provides information to measures how effectively the above objectives are being delivered. 
• Prepare cash flow and ORDM processes for a minimum of 20 years to enable strategic planning of asset renewal and maintenance cash flows needed to sustain the infrastructure asset stock.

Topics of Analysis
Our approach is to establish process maps of existing and desired maintenance scheduling and management functions and prepare an asset management plan that addresses the following issues.
• What assets do we have?
• What condition are they in?
• What is the recommended policy strategy to match sustainable service levels with actual funding? 
• What are the financial liabilities associated with preserving current levels of service over the next one, three, five, ten, and 50+ years? This requires the generation of cashflows associated with service provision and associated asset requirements. How do these financial liabilities compare with current assessments of revenue potential? 
• How is Council going to determine and specify a “satisfactory” level of service? (What is the role of community/customer input)? What levels of service are sustainable and necessary to provide the quality of life set out in the organisation's vision?
• How do these sustainable levels of service compare with current levels of service? 
• How will Council determine the capital and maintenance cashflows associated with this “satisfactory” level of service to determine whether the level specified is sustainable? Over what period of time should the cashflow be run and why? 
• What organisational and management structures best support and provide these services and can organise and co-ordinate assets? 
• What are the key elements that need to be included in service level agreements to ensure that the specified levels of service are achieved?
• What is the best way of delivering infrastructure based services so that the community gets the best possible value for money? 
• What systems, assets and resources are required to deliver these services? 
• How can we measure the actual service quality, timeliness and value being delivered and identify, measure and improve performance? 
• What is the best maintenance strategy for each asset, (reactive/breakdown, scheduled, condition service level) to enable the lowest life cycle maintenance costs? 
• What is the risk profile of each asset and asset class? 
• How can Council produce statutory reports and annual reports to the community using existing systems and processes? 
• How can infrastructure decision support systems be maintained at the lowest possible overhead costs? 
• How can individual innovation and motivation of people involved with service delivery be enhanced?
• How can we ensure that every activity by individuals and teams contributes to the organisation's goals?

Asset Management Plan Methodology
An asset management plan takes the AMS and makes it work. That is, if the Strategy indicates that developing the council area as a ‘regional hub’ is a priority one, then the plan should look at options for achieving this goal.
Some options will cost more than others but maybe do more. Some will have high capital costs; some may have high ongoing costs. Each option will probably interact with other assets and other projects, increasing or reducing the demand for them, and this should be revealed in the AMP's. It is quite proper to present several, optional, AMP’s to council if there are a number of options to be considered. Only when council can see both the initial and the ongoing consequences of different options can it make a reasoned decision.

How Far Ahead Should We Plan?
In general, far enough to give you time to recognise a future problem, develop and test options, select and take action; not so far that the answers are pure guesswork. In practice, one year provides practically no planning time and is far too short, 30 years for most asset custodians is too “iffy” and therefore too long. New Zealand councils started with 3 years but have now happily worked with a 10 year planning horizon for a number of years. 10 years is more easily manageable if thought of as three, interlocking, plans; namely a one year plan, a 2-3 year plan and a 4-10 year plan with the nearer period plans being more detailed and more accurate.

The proposed timeframes are 5, 10 and 20 years.

The Asset Management Improvement Plan
When we first start to put together the Asset Management Strategy, we are likely to find that a lot of the information we need is simply not available.

This is where the “Asset Management Improvement Plan” comes in. The Improvement Plan is designed to document activities for improving the asset management process. It will consider issues such as:

• What information is needed
• What skills and expertise are needed
• What training for personnel is needed
• What communication frameworks are desirable
• What asset information systems are needed
• Whether any organizational structures need to be changed

The integration of the asset management strategy, asset management plan and asset improvement plan.

Unlike the Strategy and the Plan which should be public documents, the Improvement Plan is a purely internal, process related, document. It is a mistake to put these process improvements in a public Asset Management Plan or Strategy as the danger is that the public will not recognise that asset management is there to provide user benefits and may see it as an “administrative make work scheme” which would be very detrimental to public support of asset management.

The Asset Management Plan in Detail [1]
The completed AM Plan will be a written representation of intended AM programmes for all infrastructure networks based on Council’s organisation’s understanding of customer requirements, existing and projected network and asset conditions and performance.

Contents of the Asset Management Plan
• Define the service levels
• Define the timeframe (lifecycle)
• Describe the asset (physical, financial)
• Include financial information (10 years +)
• Recognise decline in service potential
• State assumptions & confidence levels
• Outline an improvement programme
• Be prepared by qualified persons
• Be a firm commitment of the council
• Current policies
• Standards
• Life cycle tactics
• Levels of service
• Information systems
• Knowledge of assets
• Work programmes

What you are spending now on asset development, renewal, maintenance and operations
• Risk management issues

Steps in Preparing the AM Plan
There are five key steps we will use when preparing the AM Plans. They are:

Step 1: Identify Our Objectives
Before we can create a successful AM Plan, determine who will read the plan, what they already know about Council, what they want to know and how they intend to use the information contained in the plan.

The needs of the target audience should be combined with your communication objectives - what you want the reader to know. Having identified and resolved any conflicts between what the target audience wants to know and what you want them to know, we are ready to begin.

Step 2: Outline our AM Plan Structure and Content
The structure and content have been defined in this proposal but this should be reviewed before we commence work.

A decision is required on how to group assets to make it easier to present asset information and lifecycle tactics and the issues impacting on their management. For example parks assets may be presented by asset type (e.g. horticulture, arboriculture, buildings, structures, etc.) or by site (e.g. by park or complex).

Factors influencing this decision include:
• The number and value of assets.
• Whether the assets are managed in similar ways.
• Scale of maintenance and operational costs.
• Where the assets are in their life cycle.
• The structure of management and service delivery contracts.

Step 3: Site Analysis and Interviews
In preparing the plan we will consider the following:

• Results of interviews with all council personnel involved with asset data and information.
• At this initial stage we will examine use most readily available information such as hard copy records, historical reports, and staff knowledge.
• Further investigation may be required, but we will not get “bogged down” in extensive research and analysis, or waiting to collect additional data. Once the plan is completed there will be a clearer picture of the most important data to collect.
• If information is unavailable, we will make the best assumptions you can based on the current information you have, write the plan on this basis, and state these assumptions clearly (keep notes on assumptions during the plan preparation). The plan is a ‘living document’ and will be updated.

Step 4: Documentation
• Following site analysis and interviews we will complete the documentation phase.
• We will prepare initial drafts of prospective financial statements and cash flow projections.
• The Executive Summary will be a stand alone document that clearly summarises the main elements of the AM plan.

Step 5: Update your Plan
Asset management plans are dynamic documents and must be updated periodically to maintain relevance. As your objectives or customer expectations change or your asset management systems improve, update your plan to reflect those changes.

Asset management improvement activities that will be incorporated into future plans should be ongoing between plan updates.

[1] From IIMM

Asset Management System

Benefits of Our System
Our mission is to provide you with a decision support system that will enable you to record and interpret past knowledge and predict optimum future scenarios in order to:

          Make wise and informed asset planning decisions for the future of your enterprise

          Monitor service performance and customer response against your goals

          Comply with external and internal reporting requirements

          Manage decision support information needed for asset management plans and risk management plans

          Manage asset life cycle knowledge needed to plan, construct or acquire, inspect, operate, maintain and renew each asset and component.

          Prepare long term financial plans to manage assets at lowest possible cost whilst controlling exposure to risk and loss.

System Implementation
Advanced asset management needs a lot of knowledge about assets.  History about costs, revenues customers, documents, plans, inspections, condition and asset performance are just a sample the data that needs to be managed.

We work with you and your people to get the most out of your existing information and use our system and skills to integrate and link the existing systems you want to retain and extract data and decommission systems you don’t wish to keep.

When you implement our system, our implementation team works with you to make sure you get the best out of all your systems that manage asset information.  These include Geographic Information Systems, Financial Systems, Customer Response Management Systems and your Relational Database Management System.

While we provide a leading asset management software system, our core business is to provide strategic and operational asset management results. You buy expertise and project implementation and integration to make sure all of your asset related systems deliver true decision support at policy and operational level. We provide senior, high level specialists in asset management and information technology for the duration of the implementation project. We also have high level “backroom” specialists for help desk, data processing and systems design.
We always work in a project team approach using partnering project management techniques to ensure high accountability and focus on outcomes. Our engineering, finance and project management background provides a good foundation for managing large and complex projects and we use formal project programming and scheduling techniques to ensure successful delivery. I look forward to working with you and your team as we develop skills and systems that will enable your organisation to be an example of world best practice in infrastructure asset management in coming years.

The Technology

The core of the system is the Asset Register Module (AREG) and Asset History Management Module (AREG HISTORY).  The technology platform is Microsoft SQL server (ORACLE is also supported).  Interface forms can use Microsoft Access – the main interface, web browser pages or most Geographic Information Systems.  Most reporting tools can be utilised including Microsoft Access, Crystal Reports and Microsoft SQL Server Reporting Services.

1.       This provides a single asset register that can:

a.       Control financial, service performance and technical data for each asset.  The provides audit trail, balancing to financial ledgers and daily, monthly, quarterly and annual reporting in accordance with Australian and International Accounting standards.  The system provides advanced facilities for valuation using both “at cost” and “fair value” methodologies in accordance with IFRS and AASB116.

b.       Link to any financial or other external system that uses an ODBC compliant relational database management system (e.g. SQL/ORACLE/INFORMIX).

c.        Provide financial reports per category, asset and component.   Each asset is independently depreciated on a daily basis using the selected depreciation method (e.g. reducing balance, linear, non linear algorithm).  Residual values, performance reporting, asset life and transaction history can be allocated per asset or per asset group

d.       Manage asset management information independently of financial reporting information using the same register.   This means finance, engineering and performance reporting for each asset or asset group can be centrally managed in one register, AREG.

2.       High level security linked to network login.  The login administration allows the system administrator have complete control over:

a.       Opening screen per user

b.       Data accessibility rights for viewing and edit

c.        Full audit trail and reporting over any transactions including the changes to data, who made the changes and when.

Asset System Modules

•Asset Register and asset history management
•Asset Inventory and External Technical Reporting
• Asset Register and Financial Reporting
• Asset Risk Management
• Asset Maintenance Scheduling
• Asset Maintenance Management
• Service Requests and Works Orders
• Parks, Buildings Transport, Drainage, Utilities Management
• Plant and Equipment management
• Optimised maintenance and renewal
• Rolling works programme
• Strategic Modeling for maintenance and renewal (integrating finance and engineering)
• Electronic data capture
• Property and facilities management
• Links to other applications

Asset Inventory
The asset inventory uses SQL/Oracle to link all core asset information including information from external systems and windows based systems (data link in real time where desirable, batch mode where desirable).

The asset inventory is an entry/view screen in MS Access/GIS/Web Browser that can source data from any MS Access compatible application or table and data is only held once in the organisation. This provides a very powerful and flexible data management system linked to the GIS.

The asset inventory or database contains a report that produces the asset register, a separate table that recognises the need for strict audit trail between the general ledger and asset register.  This approach allows continual changes and updates to occur to the asset inventory without compromising the asset register. The asset register can combine data from financial or third party maintenance management systems (e.g. for capital and maintenance transactions for assets) with the infrastructure asset register that may be held in the asset system. What component of the asset register is held where is totally at the discretion of the financial manager and is subject to full audit trail.

The asset inventory screen provides links to any other related source of information including GIS, CAD, digital images, work processing of spreadsheet files and specialist applications. This provides the Intranet and Internet compatible functions normally associated with data warehousing.

A Complete Decision Support System
Asset knowledge is all information needed to:

1.         Understand how past decisions have resulted in the present position.

2.             Understand likely future trends and desired service outcomes needed to achieve the organisation’s mission

3.             Make wise decisions on the best way to achieve the desired outcome with available resources.

4.             Have an understanding of the likely long term consequences of our current decisions.



Asset Knowledge Acquisition

Benefits of Better Asset Knowledge

Our mission is to provide you with a decision support knowledge that will enable you to record and interpret past knowledge and predict optimum future scenarios in order to:

          Make wise and informed asset planning decisions for the future of your enterprise

          Monitor service performance and customer response against your goals

          Comply with external and internal reporting requirements

          Manage decision support information needed for asset management plans and risk management plans

          Manage asset life cycle knowledge needed to plan, construct or acquire, inspect, operate, maintain and renew each asset and component.

          Prepare long term financial plans to manage assets at lowest possible cost whilst controlling exposure to risk and loss.

On Site Condition and Risk Audits
JRA provides high quality data capture and analysis services for
• Buildings and Property
• Roads and Transport Assets
• Stormwater Drainage
• Water, Sewer and Utilities

Data Capture Systems use GIS and create an asset register with high quality condition data loaded into your system or our asset and risk management system and modeling tools.

Clients Include

• Narrandera Shire Council (NSW)
• Mornington Peninsula Shire Council (VIC)
• Woollahra Council (NSW)
• North East Water (VIC)
• City of Playford (SA)
• Goondiwindi Regional Council (QLD)
• Conargo Shire Council
• Murray Shire Council
• Leichhardt Municipal Council (NSW)
• Weddin Shire Council
• Wentworth Shire Council
• Murrumbidgee Shire Council
• Harden Shire Council
• Knox City Council (VIC)

Typical Attributes of Data Capture

• Plot asset on GIS and link to Asset system.
• Asset type / material
• Dimensions (width, length, area)
• Condition Index (1-5)
• Risk Criticality Index (1-10) or detailed risk matrix.
• Remaining Life (years to renewal)
• Areas requiring maintenance / rehabilitation (GIS location, work required, digital photo)
Link to road segment

• Linked digital photo

The Technology
We use handheld GPS enables field computers that link to digital photos of defects and assets.  Data can be delivered in any GPS and database format.

The People
We use our own staff including experienced data capture and processing personnel and experienced Civil Engineers.  We will match a team to suit your needs for every phase of improving your asset knowledge including:

          Conversion from CAD, paper maps and Aerial Photography

          Linking GIS with data in database formats

          Post processing field capture data

          Loading field captured data into databases and asset management systems.

Analysis of results including risk management plans, asset management plans, defect rectification programmes and works programmes.

Asset Management Reviews

JRA provides asset management audit and analysis services for
• Buildings and Property
• Roads and Transport Assets
• Stormwater Drainage
• Water, Sewer and Utilities

We assess the funding models and asset management policies to determine the sustainability of asset owners and recommend strategies to improve the short medium and long term financial position and reporting systems for asset custodians.

Clients Include
• Tasmanian Auditor General
• Victorian Auditor General

Case Studies
Dr Penny Burns, David Hope and JRA have completed a statewide analysis of infrastructure management and reporting for every council in Victoria. The Victorian government is now implementing the recommendations in our report “Facing the Renewal Challenge”. A statewide study of every council in South Australia, again examining and reporting on asset management and financial and management practices, that we prepared for the South Australian Local Government Association, is also now being implemented. The current study would be conducted by JRA and Dr Penny Burns with the specialist advice of David Hope.
JRA was commissioned to complete a review in 1998 and again in 2001, reviewing financial Council’s road and bridge asset reporting practices where we visited and interviewed all Councils in Tasmania. Our report and practice guide was accepted by the Tasmanian Parliament and is now the practice guide for financial reporting for local government in Tasmania.

Internet/Intranet Solutions

JRA provides online services delivery solutions for

• Buildings and Property
• Roads and Transport Assets
• Stormwater Drainage
• Water, Sewer and Utilities
• Private sector service delivery companies that are asset intensive

Clients Include
• Australian Local Government Association Transinfo
• AUSTROADS National Performance Indicator Site
• South Australian Local Government Infrastructure Study
• MAV Asset Management Knowledge Database


Risk Management

The objective of risk management is to establish systems and controls that enable the potential risks that may be faced by an organisation to be adequately managed.

The first step requires a comprehensive review of the responsibilities of an organisation in order to identify all potential risks and assess the consequence incidents having regard to the legislation (both current and future), common law and the community’s expectations. The correct assessment of the potential severity or criticality of a risk is vital.

JRA provides risk management audit and analysis services for
• Buildings and Property
• Roads and Transport Assets
• Stormwater Drainage
• Water, Sewer and Utilities
• Risk Identification

It is necessary to determine what types of risk events might impact on assets. We can group these risk events into:
natural events where there is no real control over timing or extent of event, though we may understand the probabilities, e.g.: floods, lightening strikes, high winds
external impacts, for example other businesses not providing services that impact on your business or individuals such as power supply failures, material supply failures
physical failure risks, where condition of the asset could lead to failure,
operational risks, where management of the asset or asset management activities might impact adversely on an asset.
Understanding the events will allow a business to understand the impacts of an event.

Risk Analysis
When the events that will impact the most on a business or a perceived critical asset are identified it is necessary to analyse that risk and determine which events and assets are most critical to the business. The business can also determine its level of exposure to risk and therefore the actions necessary to minimise that risk.

Organisations need to determine the consequences of failure for events and the probability of failure of the asset or the occurrence of an event to estimate the level of risk applicable. Consequences of failure are linked to the asset types and include:
• Repair costs
• Loss of income
• Loss of life or injury
• Health impacts
• Damage to property
• Failure to meet statutory requirements
• Loss of image

The probability of physical failure of an asset is directly related to the current condition of the asset, hence the importance of realistic and accurate condition assessment.

The probability of natural and external events is less easily determined but there are sources of knowledge on the occurrence of these events.

If a business applies relative costs to the consequences then a business risk cost estimate can be made and events and failures compared to establish the most critical events or assets for that business. When all assets are assessed the business can determine the amount of risk it wishes to carry and the amount it wishes to minimise.