Transforming Asset Management Capabilities at Bord Gáis Networks Paul Lennon EGATEC 2011
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Contents
Development of Asset Management Department
Challenges and Benefits
Vision and Scope of the Networks Transformation Programme
Overview of Bord Gáis Networks
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Bord Gáis Networks – Overview
Irish Gas Market Place • Bord Gáis Networks, on behalf of Gaslink, develops, operates and
maintains the Transmission and Distribution network in Republic of Ireland.
• It also owns and operates significant gas pipeline assets in Northern Ireland.
• Owned by the State • Set up in 1977 • Provides gas to ~650,000 gas users • Over 90% gas comes from UK Interconnectors Assets • 2,400km of Transmission Pipelines • 11,000km of Distribution Pipelines • 3 Compressor Stations • 180 AGIs • Asset value approx €2.5 Billion • Total Staff of approx 500
• Reasons for Transformation Programme • Emerging from period of rapid network expansion • Ageing IT systems • Market opening • Increased regulatory pressures • Need for increased efficiencies • Satisfy increased customer expectations
4 4
Development of Asset Management Department
Challenges and Benefits
Vision and Scope of the Networks Transformation Programme
Overview of Bord Gáis Networks
5
Focus on Customer Excellence
Build a structure that promotes
functional excellence
Realise increased value through
partnerships with contractors /
suppliers
Optimise the standards &
policies
Achieve out-performance
through step change in core T&D capabilities
Next generation IT systems
Networks Transformation Vision & Strategy “Make BGN a best in class Network Utility Service Provider, and Improve
it’s Customer Service capability, allowing it to meet current and future regulatory targets and expectations”
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Delivering the Vision Delivering Excellence across
Networks
Focus on Customer Excellence
Build a structure
that promotes functional excellence Realise increased
value through partnerships
with contractors /
suppliers
Optimise the standards &
policies
Achieve out-performance through step
change in core
Networks capabilities
Next generation IT
systems
• Step change in Asset Management, Work Management, Field Force, Metering, Operations, Construction, Supply Chain, etc.) • Out-performance in PR2 / readiness for PR3
• Customer centric operations • Unified positive view of BGN • Single service delivery, process & standards
• Make BGN a great place to work • Provide platform for other BG businesses (e.g. electricity generation /
Firmus Energy / future mergers) • Build a structure that supports process excellence
• Build asset stewardship • Build suite of leading standards / policies • Build long term perspective for BGN
• IT systems to enable operational excellence and sustain the efficiencies • IT support to Work & Asset Management, Work Delivery, Customer Contact, Materials Management, Metering, etc.
• Rollout of contracting capability model for work delivery activities • Help to transform Bord Gáis’ strategic partners
Target Operating Model And New Processes
Head of Bord Gáis
Networks
Asset Management
Asset Strategy Investment Management
Asset Programmes
Asset Information Customer Workflow
Progression Detailed Design Data & Records Scheduling & Dispatch
Operations Performance Services Construction
DeliveryNetworks
Operations Risk Safety Environment Management Systems
Regulatory Affairs Commercial
Workflow Management Service Delivery Regulation &
CommercialSafety, Quality,
Environment
Delivery Support
Quality & Management
Systems, including Audit &
Compliance
Business Intelligence
Asset Information Management
Conceptual Planning
Contract Strategy
Asset Programme Management
Integrated Planning
Investment Analysis &
Review
Investment Planning & Budgeting
Network Analysis & Strategic Planning
Asset Strategy, Policy, Integrity &
Performance
Material Design & Innovation
Shipper Services & Large Account
Management
Customer & Marketing Strategy
Price Reviews
Capacity Register,
GasPoint & FAR
Regulation Management
Revenue & Tariff Setting
Transmission Construction Management
Distribution Construction Management
Agriculture Liaison Officers
Distribution Project
Management
Grid Control
Maintenance
Emergency & Repairs
C & I
Specialist Technical Services
Siteworks Management
Stores & Materials Management
Field Performance Management
Fieldforce
Sales (New Connections)
Quotations
Licensing
Short Term Materials & Logistics
Health, Safety & Environment
Planning
Wayleaves Admin-istration
Customer Call Handling
Customer Complaint
Customer Survey
Estimation
Detailed Design
Technical Project Planning
Drawing (incl. GIS Updates)
Data Quality
Data Control
Scheduling
Dispatch
Emergency Dispatch
Manage Workflow Performance
Monitor Field Performance
Business Intelligence (WF
& SD)
Safety Case & Policy
Environmental Action Planning
Risk Management & Business Continuity
Manual Job Progression
Fieldwork Estimation
Inspectors
Trading & Settlements
Data Operations
System Training
Revenue Reporting
Meter Reading & Dispatch
Site Engineers
Regulatory Controls
Reporting Procurement Transaction Risk (incl. Insurance) HR IT Facilities
Administration (incl.
Reception)
HRFinance FacilitiesIT
Training
Safety Management
Systems
Unregulated Commercial Contracts
New Organsiation Structure 6
Balanced Scorecard Perspectives
HSE
Customer
Internal processes
Financial
Level 3: Departments
Manage Investment Asset Programmes
Asset Strategy
Customer Workflow progression Detailed design
Services Networks Operations Construction Delivery
Management systems Safety Environment Risk
Regulatory affairs Commercial Regulatory controls
Asset Information
Operations performance Data and records Scheduling and dispatch
BS Perspec
Value Lever
KPI Indicator Description Indicator Rationale Data Points
Financial Efficiency Service Delivery direct cost as % of total cost
Provides total service delivery costs as a % of total completed work costs (potential to consider breakdown e.g. materials vs. contractor costs)
Measures service delivery management cost efficiency; should be viewed within context of total workflow volumes and cost
Total service delivery costsTotal out-turn cost of work
BS Perspec
Value Lever
KPI Indicator Description Indicator Rationale Data Points
Financial Efficiency Service Delivery direct cost as % of total cost
Provides total service delivery costs as a % of total completed work costs (potential to consider breakdown e.g. materials vs. contractor costs)
Measures service delivery management cost efficiency; should be viewed within context of total workflow volumes and cost
Total service delivery costsTotal out-turn cost of work
As se t M g mt
Wor
kflo
w
Man
agem
ent
Ser
vice
D
eliv
ery
Reg
. &
C
omm
. S Q E
Leve
l 2:
Func
tion
s
KPI/ Balanced Scorecard
Decision Support Tools
Based on the Vision for Bord Gáis Networks.....
new operating model, organisation structure,
business processes, and KPIs were developed .....
These new processes & capabilities being automated and
standardised through a new set of integrated
systems
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New Operating Model – High Performance Utility Model (T&D)
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New Operating Model – High Performance Utility Model (T&D)
ASSET MANAGEMENT
WORKFLOW
SERVICE DELIVERY
REGULATORY AND COMMERCIAL
WORKFLOW
HSQ
E
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Reorganise Company to Fit HPUM
HPUM Activities
Asset Management Investment
Management
Asset Strateg
y
Asset Programmes
Asset Information
Asset Strategy Policy & Compliance
Network Analysis & Long Term Planning
Asset Performance & Condition Mgt
Asset Risk Management
Project Initiation
Programme Planning & Conceptual Design
Maintenance Forecasting
Deferrals & Variance Management
Data Management & Audit
Information Strategy & Governance Asset Investment Review
Long & Medium Term Planning
Investment Analysis
Capital & OM Budgeting
System & Material Design, Innovation & Engineering
Integrated Resource & Supply Chain Planning
Contract Strategy
Delivery Performance Management
Note: Meters are included as an asset
Org Building Blocks
Head of Bord Gáis Networks
Service Delivery
W orkflow Managemen
t
Asset Managemen
t Safety Quality &
Environment Regulation & Commercial
Investment Management
(1)
Asset Strategy
(1)
Asset Programmes
(1)
Asset Information
Network Analysis & Long Term Planning
Asset Strateg
y, Policy, Integrit
y & Performance (Contr
ol Systems,
AGIs & DRI,
Pipelines &
Mains, Customer
Meters,
Compressor Station
s)
System & Material Design (including Innovation & Engineering)
Investment Analysis & Review
Investment Planning & Budgeting
Programme Planning & Conceptual Design
Contract Strategy (Materials and/or Services Required)
Asset Program
me Mgmt
(Integrated
Resource &
Supply Chain
planning, Perform
ance Mgmt
Strategy, Maintena
nce Forecasting, Risk Assessment for Deferral
s)
Business Intelligence (1)
Asset Info Management (1)
Teams
HPUM Processes
Roles
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New Asset & Work Management Systems
● Maximo is the work and asset mangement system. Holds Asset Register. All jobs scheduled and tracked in Maximo.
● The Click system is used to assign the work to handheld devices
● Syclo is used to return real time data from the field to Maximo
Maximo Click
Syclo
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May 2009
Jun 2009
Jul 2009
Aug 2009
Sep 2009
Oct 2009
Nov 2009
Dec 2009
Jan 2010
Feb 2010
Mar 2010
Apr 2010
May 2010
Jun 2010
Jul 2010
Aug 2010
Sep 2010
Oct 2010
Nov 2010
Dec 2010
Jan 2011
Feb 2011
Mar 2011
Apr 2011
Define Operating
Model Deliver New Organisation & Processes Deliver Systems Deploy & Deliver
Benefits
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Development of Asset Management Department
Challenges and Benefits
Vision and Scope of the Networks Transformation Programme
Overview of Bord Gáis Networks
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Vision for Asset Management Department
● Contribute to making BGN a leading Utility Service Provider with a strong asset
management capability/focus by:
● Making proactive Asset Investment decisions based on quality data ● Predicting and managing the performance of our Assets ● Managing Asset risk and value (Commercially Aware) ● Doing ‘more with less’ ● Playing a central role in Regulatory Price Reviews ● Having skills and processes which are capable of being transferred to other Asset/Business
Areas
● Key to achieving this was the establishment of a dedicated Asset Management Department
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New Asset Management Department Structure Head of Asset Management
Asset Programmes
Investment Management
Asset Strategy
Asset Strategy, Policy, &
Performance (Asset Segments)
Network Analysis & Strategic Planning Asset Integrity Investment Planning
Investment Performance
Conceptual Planning
Contract Strategy (Materials and/or
Services Required)
Asset Programme Management
Integrated Planning
Asset Information Management
Total Number of Staff = 45
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Asset Strategy
Head of Asset Strategy
Network Analysis & Strategic Planning
Asset Information 5 x Asset Owners AGIs & DRIs
Pipelines Compressors
Meters C&I
Asset Integrity
Key Objectives •Maximise Integrity of all Asset Classes •Minimise Risk •Develop Risk Based Asset Policies •Third Party Liaison •Lab Activities
Key Objectives •Demand Forecasting •Network Modelling & Analysis •Plan Development of the Network
Key Objectives •Manage Networks Data •Real up-to-date Asset Information •Informed Decisions •Development of Decision Support Tools •KPI’s & Metrics
Key Objectives •Own the Assets •Asset Policy Frameworks
•Legal Compliance •Technical Compliance •Manage Risk •Optimise Returns
•Replacement Strategies •Investment Strategies •Innovation •Asset Plans
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Investment Management
Head of Investment Management
Investment Planning
Investment Performance
Key Objectives •Investment Business Case Preparation •5 Year Investment Plans •Annual Budgets •Post Investment Reviews •Project Approval Commitee Process Owners •Price Review
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Asset Programmes
Head of Asset Programmes
Integrated Planning
Contracts Management
Conceptual Planning Asset Programmes
Key Objectives •Programme Management •Programme Approvals •Price Control •Efficiencies
Key Objectives •12-18 month plan •Integrated Resource Plan •Integrated Supply Chain Plan •Identify Constraints
Key Objectives •Contract Management Risk and Value •Contract Performance •Manage tender process •Network Services Contract •Category Management •Process Standardisation •Efficiencies/Savings
Key Objectives •Options Analysis – T&D •High Level Estimation •Optimising design solutions
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● Up-to-date and accurate information is vital to enable informed decisions to be made.
● Asset Information team support the Asset Management function by providing/utilising a range of reporting tool
● This approach provides ● Greater clarity and cohesion on what the important issues are
● Shifts focus to exception reporting and out of tolerance issues ● Focuses on delivery of key strategic objectives
● Improved efficiency ● Increases quality of information for decision making ● More time analysing information, less time preparing it
● Flexibility to adapt to changing business information needs
● Tools used:- ● Reports (Source system reports, data warehouse for cross system reports) ● KPIs and Metrics linked to Corporate Goals ● Interactive dashboards showing key information & trending to management ● Scenario Modelling Decision Support Tools
Asset Information / Business Intelligence
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Decision Support Tools
● Different tools are used depending on what question is being asked
Analysis Complexity
What happened?
Where was the cause of the issue?
Why is this happening?
Given our knowledge, what will happen next?
What best outcome can we achieve?
What if this trend continues?
Maximo & Data Warehouse Reports
Scenario Business modelling
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● Asset Management Scenario Modelling Tool ● Ability to run scenarios to see future impact of decisions ● Governing asset policies included ● Linked to data warehouse to access current asset information
Scenario Modelling Decision Support Tool
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KPI and Metrics Sample Dashboard ● Interactive dashboards will show key information & trending to management
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PAS55 Accreditation
● PAS 55 is the British Standards publicly available specification for the optimised management of physical assets ● Provides clear definitions and a 28-point requirements specification for
establishing and verifying a joined-up, optimised and whole-life management system.
● In 2007 a PAS 55 gap analysis was completed which concluded;
● No overall Asset Management System in place across business ● Pockets of very good practice being employed ● Asset Management principles need to embedded at lower management levels
to be effective
● A detailed PAS 55 gap analysis is to be performed again later in 2011 ● Given new structure, policies, processes and systems now in place it is
expected that gaps will be relatively minor ● Based on gap analysis a programme to achieve accreditation will be
developed ● Accreditation is not a requirement in Ireland but we believe it gives external
approval and validates our asset management systems
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Managing the Asset – What’s Changed?
Capability Pre Implementation
Manage Investments & Asset Programmes
Dispersed Asset Management function with varying quality asset information Capex forward looking but Opex built up from previous budget Development of strategic plans involved manual processes
Good Asset Investment Review processes in place
Compliance with regulatory standards
Post Full Implementation
Centralised Asset Management function with full Asset and Maintenance records providing full Asset Condition and Asset Performance Integrated Asset Planning Process for both Capex & Opex plans – activity based and forward looking Strategic Simulation model for long term scenario planning helps provide optimum returns on asset investments Aim/challenge to be more specific at asset level E.g DRI maintenance V replacement cost? Risk & Reward model, Improved Control and Mgt of risk - definition of criticality Delivery of capital and operations efficiencies
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Capability Today Post Full Implementation
Manage Asset Strategy
Low understanding of Total Cost of Ownership Low use of Asset Performance data Reliance on national standards covering most assets Extensive risks documented along with associated controls
Centralised Asset and Maintenance records providing full work and costs from cradle to grave
Measurement of asset performance, condition, and life expectancy as input to long-term asset planning Derive customised standards to meet local leading practices
Proactive Risk Management capability, minimising regulatory value at risk
Comprehensive Asset Strategy and Policies to optimise work volumes
Manage Asset Information
Independent systems and manual Asset Registers Data constraints indicative of a System led approach rather than Business led Lots of data is held locally and needs to be more widely available
Centralised/integrated systems Business led data model and architecture Data capture is automated as much and as early as possible
Managing the Asset – What’s Changed?
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Development of Asset Management Department
Challenges and Benefits
Vision and Scope of the Networks Transformation Programme
Overview of Bord Gáis Networks
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Challenges To Establishing The AM Department
•People • Understanding and acceptance of the AM Model Across the Organisation • Need to challenge the ‘this is the way we have always done it’ • People in AM understanding their own role and the need to interface into the wider organisation. • People ‘leaving behind’ some of their present day duties and taking up new ones • A lot of people being taken out of the business on training, testing etc
•Process • Establish the relationships to ensure inputs/outputs are agreed to facilitate all the work of AM • Implementing common processes across transmission and distribution
•Systems • Working through the bedding down period post go live, incl. coping with minimal data • Accept that there will be some initial negative efficiency impacts across the business
•Intelligence • Source data for our KPIs before systems are in place. • Quality and Usability of asset Data • Continued DST Development
•Safety • Ensuring safety remains top priority during transition period
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Benefits Experienced To Date
•People • More defined structure, greater clarity in roles • Quicker decision making • Better management of contractors
•Process • Detailed set of process to define how organisation works • Implementing common processes across transmission and distribution leading to efficiencies
•Systems • Customer Service improvements – greater visibility in terms of siteworks • Improvements in data and records
•Cost & Efficiency • Better understanding of CAPEX and OPEX entering price control negotiations • Improved CAPEX governance • Better care regimes for assets • Opex Reductions
• Headcount and Efficient Work Practice • Optimising Siteworks and Maintenance Activities
• Greater ability to benchmark
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Questions ?
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Bringing the Model to Life Asset Management
Workflow Management
Regulations & Commercial
Asset Strategy - Network Analysis & Strategic Planning
Customer Scheduling & Dispatch
Workflow Progression
Problems identified with high level proposals for how to solve
Long Term Network
Development Plan
Design
Technical Project Planning
HS&E Planning
Prereq Mgt
• Shippers information
• New Connections, e.g. Power stations
• Tariffs• Regulator
Asset Strategy – Policy, Integrity &
Performance
Technical Policies
Asset Segments – frequencies, materials, procedures, competence
Asset Programmes – Integrated Planning
Investment Management – Analysis & Review
PrioritisationScenario Analysis
Post Investment ReviewCapital Efficiencies
Licensing (inc road openings)
Wayleaves Admin
Short Term Materials & Logistics
Operations Performance
Asset Programmes – Contract Strategy
Holistic view of services, and / or materials required
Master plan
Contract Management
&/or Tendering
Service Delivery
Manage & deliver construction projects
Construction Delivery
Input to tendering process from Construction delivery
Manage Workflow Performance
Monitor Field Performance
Business Intelligence
Scheduling
Dispatch
Gas Control (Emergency)
Safety, Quality & Environment
External
Asset Strategy – Materials & Innovation
Asset Information Asset Information Management
0
Detailed Design
Drawing (inc GIS Updates)
Revision 723/07/09
Distribution Example:
Construction, Replacement,
Reinforcement, Diversion
e.g. New Town
Input regarding Contract delivery performance
Estimates
Feedback regarding new connection status
Support for Regulatory submissions, e.g. PCR
Investment Management – Investment planning
Asset Programmes – Conceptual Planning Asset
Programmes – Programme Management
Business Intelligence
Support Construction
Delivery
Support tendering
process
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Desktop StudyNetwork AnalysisOptions AnalysisHigh Level Estimation
5
Recommended high level design
option with estimated cost
Interim approval to proceed with
detailed design
6
ID project to develop based on the overall view
Kick off Conceptual Planning processes
Initiate Detailed Design &
EstimationCompleted
Design
Seek final approval to deliver / tender
CAPEX & OPEX Long & Medium Term Plan
10
Monitor & Review
9
7
8b
3
4
ü
DGI Detailed Design(Mech,Civil,C&I)Modelling AnalysisTender & Construction Drawings (where necessary)Detailed Estimates
1113
12a
8a
Manage & deliver construction projectsManage & deliver
construction projects
Construction DeliveryInc.
specialists; e.g. welders
12b
14
15a
15bSafety Case, Policy & Training
Risk
Environment
Management Systems
Manual Job Progression
Data & Records
Data OperationsData Control
Data Quality
System Training
Customer Call Handling Management
Customer Complaint
Customer Survey
Quotations
Operations DeliveryManage and deliver
connections and maintenance and repair
of network assets
Network OperationsManage and deliver
connections and maintenance and repair
of network assets
Services
Grid ControlMonitor & Operate Tx & Dx Network safely and reliably
Delivery Support
Meter Reading & Dispatch
Sales (New) Siteworks ManagementField Work Estimation
30
New Operating Model – High Performance Utility Model (T&D)
ASSET MANAGEMENT
WORKFLOW
SERVICE DELIVERY
REGULATORY AND COMMERCIAL
WORKFLOW
HSQ
E
31
New Asset Management Department Structure Head of Asset Management
Asset Programmes
Investment Management
Asset Strategy
Asset Strategy, Policy, &
Performance (Asset Segments)
Network Analysis & Strategic Planning Asset Integrity Investment Planning
Investment Performance
Conceptual Planning
Contract Strategy (Materials and/or
Services Required)
Asset Programme Management
Integrated Planning
Asset Information Management
Total Number of Staff = 45