asset management utility management the “connection · the manual contains sections outlining...
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MWEA/MI-AWWA AM Seminar 2019
Asset Management – Utility ManagementThe “Connection”
Tom DeLaura, PE
Connector
DeLaura Consulting
January 24, 2019
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The “Connection?”
As we go through these presentations
– find your “perspective” of what AM
is, and prepare to “explain” it
Recognize how that “connects” to
Utility Management
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AIM Committee – here to serve
Know what’s been done (resources)
Ask for what you wish to see
Connect with peers in similar situations
AM is all about Money
Provide Visibility
Inform on performance, conditions, risks, costs,
reliability – starts the necessary culture change
“Assign” Costs of Ownership
Labor and materials associated with the correct
assets
Justifying CIP Planning and O&M Programming
based on actual condition and performance
Eliminate Surprises
By planning for them
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How do you manage?
• Balanced Scorecard
• Triple Bottom Line
• Another way?
• AM provides the justification, the
data, the facts, etc. - to accomplish
your “plans”
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Step 1 - Define “Assets” in AM
• AM has been defined a lot of ways, and by
a lot of people
• Assets can be everything you use to
accomplish your mission
• Begin every conversation on AM with a
common ground on definitions
• Resources exist to create your definitions
Asset Management depends on your perspective
on your
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“Assets” (at some level of detail and relationship…)
• Vertical
• Linear
• Facilities/Buildings
• Vehicles/Equipment
• People
• Money
• Documentation
• Knowledge
• Others?
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The manual starts with basic asset management principles
and works through to practical steps for implementing
advanced asset management systems within your
organization.
The manual contains sections outlining asset management
practice in NZ, AUS, SA, UK and US. Loaded with
informative case studies, and presented in a easy to use
format, the International Infrastructure Management Manual
is the ultimate reference document for any asset manager.
Over 20 years ago….
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Asset Management Lifecycle
Manage the entire
life of “assets”
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2001 NACWA (AMSA), AMWA, WEF, AWWA
Managing Public Infrastructure Assets
1. What is the current state of my assets?
2. What is my required level of service (LOS)?
3. Which assets are critical to sustained performance?
4. What is my best O&M and CIP investment strategies?
5. What is my best long-term funding strategy?
EPA’s Five Core Questions
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EPA’s 10 Step Process
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Triple Bottom Line
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MWEA/MI-AWWA AM Seminar 2019
Affordability
MWEA/MI-AWWA AM Seminar 2019
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Resources
Accountability
Tools
Training
Execution
Vision
Mission
Goals
Performance Measures
Role of Performance Management
Strategic Plan
Implementation
Plan
Communication
Corrective Action
Plan – Do – Check - Act
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Those which monitor performance
against pre-established
targets or industry standards.
What are “Effective” Metrics?
If you don’t know where you are going, and you
don’t know how you are doing, you won’t know if
you ever get there!
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Lord Kelvin said it first
“When you can measure what you are speaking about, and express
it in numbers, you know something about it; but when you
cannot measure it, when you cannot express it in numbers, your
knowledge is of a meager and unsatisfactory kind.”
Measure what counts.
Measure what you can control.
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Effective KPIs
Objective
Balanced
Defined Targets for Levels of Performance
Linked to Strategic Plans
Supported by All
Follow Industry Standards
Sustainable (as defined by the KPIs)
MWEA/MI-AWWA AM Seminar 2019
Effective Utility Management
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“Attributes of the Best Managed”
“Water Sector Utility Management Strategy” - created in
March 2007, by seven “Collaborating Organizations”
• Water Environment Federation (WEF)
• National Association of Clean Water Agencies (NACWA)
• United States Environmental Protection Agency (EPA)
• Association of Metropolitan Water Agencies (AMWA)
• American Public Works Association (APWA)
• American Water Works Association (AWWA)
• National Association of Water Companies (NAWC)
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Effective Utility Management
www.epa.gov/waterinfrastructure/pdfs/
www.waterEUM.org
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The 10 Attributes
• Product Quality
• Customer Satisfaction
• Employee and Leadership Development
• Operational Optimization
• Financial Viability
• Infrastructure Stability
• Operational Resiliency
• Community Sustainability
• Water Resource Adequacy
• Stakeholder Understanding and Support
MWEA/MI-AWWA AM Seminar 2019
This publication is made possible by AWWA Utility
Benchmarking Program Participants, and it allows
utility managers to use data and analyses to determine
how their utility’s performance compares to the water or
wastewater industry.
The report includes performance indicators for five
areas of operations: Organizational Development,
Customer Relations, Business Operations, Water
Operations, and Wastewater Operations.
The 2018 publication includes 54 key performance
indicators.
2018 AWWA Utility Benchmarking
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‘02 ‘03 ‘04 ‘05 ‘06 ‘07 ‘08
Lost & Unaccounted For Water
Regulatory Guideline
Best Practice
Industry
Standard
Utility Target
How are we doing??
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4
6
8
10
(%)
Benchmarking vs. Performance Management
Performance Management - The process of monitoring organizational
performance against pre-established targets.
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Organizational Development (contents)
• Organizational Best Practices Index (AM)
• Employee Health & Safety Severity Rate
• Training Hours per Employee
• Customer Account Ratios
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Organizational Best Practices -Measured by 7 Mgmt Practices
• Strategic Planning
• Long-term Financial Planning
• Risk Management Planning
• Cohesiveness in Measures
• Optimized Asset Management
• Performance Measurement
• Customer Involvement
• Continuous Improvement
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Moneyball
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What are the “Best” Performance Measures?
20 Triple Doubles/Year
1.7 ERA
.8851 Save Percentage
8 Minute Mile
98 Bowling Average
52 Hit by Pitch
5 Stanley Cups
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Performance Measures Matter
200 vacancies
25 breaks / year
45% preventive/reactive maintenance ratio
Avg. 98 days to hire
2.5% turnover rate
A+ bond rating
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Performance Measures Matter
90% response time in less than 45 minutes
7 days emergency storage capacity
Avg. 45 seconds/customer call
$25/year/customer on public education
$350/MG treated water cost
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What are your peers doing?
• A recent presentation brought AM results that
requested changing a current level or replacing 3
miles/year of main to 8 miles/year based on “heat
maps” and water quality reports, as it referenced
a nationally recognized measure of an
“optimized” utility having 15 breaks/100 mi/yr
• It showed a fully vetted analysis of what needs to
be done – and that there were factors outside of
age, or even pipe type, that justified adjusting
plans and budgets
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BalancedScorecard
Goals &Measures
Customer
Perspective
How do we look
to customers?
Financial
Perspective
How do we look
to stakeholders?
Internal
Business
Perspective
What must we
do to excel?
Innovation
& Learning
Perspective
Can we continue
to improve and
create value?
Source: The Balanced ScorecardKaplan & Norton
Keep Perspectives Balanced
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Asset Management is Utility Management
• You’ve always been doing AM, you just didn’t call
it that
• Make your definition of Asset Management
• AM is not “shelfware” – a report, a plan; it is your
lifestyle
• KPIs that align with plans and achieve objectives
• Plan with open eyes and an informed perspective,
and connect your plans in cohesive actions and
common goals
• Act with confidence
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AM is Utility Management
• CIPs/O&M – budgets justified
• Perspectives are balanced
• Provides answers to “Did you know…..?”
• Use today as “reference points” while you
gather perspectives from your peers
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Asset Management is Utility Management
• Inform your perspectives, beginning with higher
perspectives, and adjust the amount of detail as
you hear from peers, and change the culture on
capturing “data” that can better match goals to
realities
• Adjust, as you progress
• Prepare: CIPs; O&M; Strategic Plans – that are
structured as required/expected, based on factual
data, to communicate needs, and open the dialog
on how to reach common goals (health, safety,
service)
