In This Issue:

Advanced Customer ServiceIdentifying & Prioritizing Critical Knowledge Management IssuesAsset Life Cycle ManagementWater Environment Research Foundation Strategic Asset Management Project

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About EMAAs an innovative management and technology consulting firm, EMA develops solutions in anticipation of changing market needs and brings new business concepts to its clients, which include water/wastewater utili-ties, public works and municipalities, and electric and gas utilities.

With offices throughout North America, EMA is headquartered in St. Paul, MN, and has provided clients with solutions since 1975.

EMA publishes the Communicator several times a year. Your comments are always welcome. Please forward them to wwichelt@ema-inc.com.

Terry Brueck............................... President/CEO

Wendy Huber-Wichelt...................Communications Editor

Kelly Meighan................ Senior Creative Specialist

EMA, Inc. 1970 Oakcrest Avenue, Suite 300 St. Paul, MN 55113-2630 651.639.5600 651.639.5730 (fax)info@ema-inc.com www.ema-inc.com

©2013 EMA, Inc. Printed in the U.S.A.

Table of Contentsinsight Advanced Customer Service Transforming Water Sector Customer Service Operations .......3

Identifying and Prioritizing Critical Knowledge Management Issues ..4

solutions City of Tallahassee, FL, Underground Utilities Wastewater Treatment Division Business Tool Helps Manage Life Cycle of Assets ...............................6

trends Research Project Helps Utilities Build and Grow Their Asset Management Programs ...............8

technology Water, Sewer EAMS Integrates Seamlessly with City Systems ..... 10

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Contributors to This Issue(Listed in order of article appearance)

Clyde YounkinChief Operations

Officer

Frank GodinPractice Director

Lynne PowersPrincipal

Consultant

Sharon PetersPrincipal

Consultant

This issue of Communicator focuses on progress and illustrates how utilities and municipalities are moving forward with projects that are improving how they do business and creating stronger, more sustainable organizations.

The City of Tallahassee feature (p. 6) shows how the City has taken steps to improve its asset management program using specific tools to mitigate risk and achieve more data-driven decision making. We also recognize the City of Ottawa, Ontario (p. 10), where a significant enterprise asset management implementation has integrated the City’s water and wastewater operations with many other systems within the organization and improved overall efficiency. Both of these asset management programs take advantage of EMA-led research on strategic asset management (p. 8).

In keeping with the theme of progress, our “advanced customer service” feature (p. 3), explores ways to transform water sector customer service operations. We also address how to identify and prioritize critical knowledge management issues (p. 4) as a generation begins to cycle out of the workplace.

Finally, we encourage you to visit our new website (www.ema-inc.com) where you can download presentations on key industry issues and view many other stories of our clients’ successes.

Moving Forward

Craig YokopenicExecutive Vice President

Get Your Communicator ElectronicallyCommunicator magazine is now available in electronic format.

Contact us at info@ema-inc.com if you prefer to receive a PDF of the magazine via email.

Interested in both formats? Contact us, and we will send both to your attention.

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Advanced Customer Service Transforming Water Sector Customer Service Operationsby Lynne Powers

cont. on page 11

Often the water sector has treated customers with a “one-size-fits-all” meter-to-pay cycle. A number of factors are causing utilities to break this paradigm and move toward a more cus-tomer-centric approach. These factors include:

• Customers’ technological sophistication and growing expectations

• Advanced Metering Infrastructure (AMI) / Meter Data Management (MDM)

• Changes in customer interactions due to economic downturn

• Retiring IT staff who will no longer be able to support legacy systems

• Water conservation and reclamation efforts

• Changing rate structures to support in-creasing infrastructure and regulatory costs with decreased water consumption

Transforming customer service operations is a multi-step process:

Step 1: Understand your customers Use customer data from your systems to understand customer behaviors, choices, and expectations.

Step 2: Expand or strengthen customer service options Provide more options for service, communication, billing, and payments to meet changing and complex customer expectations.

Step 3: Create operational efficiencies Focus on quality and efficient business processes by creating cost-effective practices and a continuous improvement culture.

A Look at the Many Customer Payment Options

Ways to TransformTransformation of customer service opera-tions focuses on news ways to bring even greater ef-ficiencies while also improving service. Examples include:

• Expanding payment options

• Using AMI data to identify accounts with questionable usage patterns

• Identifying why customers call and addressing the root cause of the most time-consuming issues

• Expanding customer communication options (e.g., web, iPhone/Android apps, texting, and social media)

• Using GIS in the contact center

• Using automated outbound dialing to notify and remind non-pay customers

• Improving service appointment management capabilities

• Rethinking billing and customer communications in light of conservation efforts and consumption patterns

Using the Steps to TransformExample: Expanded Payment Options Utilities can use the step-by-step process above as a framework to explore aspects of customer service they wish to improve. The following example shows how to apply the framework and move toward more

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Identifying and Prioritizing Critical Knowledge Management IssuesWe often say our people are our most valuable assets. But are we really walking the talk? Are we really making sure the right people have the right skills at the right time to perform the work we need to do to sustain or improve our operations?

Knowledge retention is rapidly emerging as a major issue for utilities as the workforce is aging, significant numbers of key employees are nearing retirement age, and our collective lack of enthusiasm for documentation is catching up with us.

Effectively managing a water utility is more complex than ever. (Figure 1) Who can carry out all of these functions and understand how they work together to deliver success? Who can help you be more cost effective, while delivering more value to customers? Who can help you decide what practices to keep, what to discard, and how to manage the change? Who can help to find creative solutions to your problems? Your knowledgeable employees.

Water Sector Workplace CompetenciesWe expect a lot of our people. In 2009, the American Water Works Association and Water Environment Federation developed a compe-tency model of all of the knowledge areas the utility workforce needs to master. (Figure 2) Built on a foundation of personal effectiveness skills, academic abilities, and workplace competencies (e.g., teamwork, problem solving, and following directions) the model contains critical industry-wide learning objectives that include safety, quality control, and regulatory requirements, as well as technical knowledge areas such as field operations and treatment processes.

Topping the pyramid, and least well defined in the model, are the management and job-specific practices unique to each utility. This is the knowledge no external training course can supply and is often crucial to your success. The bottom line: there is a lot utility employees need to know, and it isn’t taught or learned without planning, resources, and discipline.

With all the conflicting priorities facing utility managers, the simpler and more straightforward something seems, the greater chance it will get done. So how do we make knowledge management as simple as possible?

Managing Knowledge as an Asset Excellent guidance is available for utilities about workforce planning, but it is not simple. If we believe knowledge is an asset, why not manage it using an Asset Management (AM) framework? Most AM frameworks focus on five core questions:

• What is the current state of my assets?

• What is the required level of service?

• Which assets are critical to sustaining performance?

• What are the best strategies for maintaining and investing in my assets to sustain them over time?

• How can I pay for these strategies?

If we consider how these questions apply to knowledge management, it becomes clear that there is a key opportunity to focus and optimize Figure 1: Ten Attributes of Effectively Managed Water Sector Utilities*

by Sharon Peters

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knowledge management efforts. This can be done by investigating the criticality of the knowledge or the risks associated with losing it or failing to advance it at a pace needed to respond to future challenges.

Asset management frameworks define criticality by considering the consequence of a failure multiplied by the probability of that failure. Business risks of failing physical assets are scored by considering factors such as: public and employee health and safety, environmental impact, product quality, production capacity, customer impacts, and costs incurred to remedy failures. Resulting scores help to focus AM efforts to increase maintenance, repair, rehabilitate, or plan for replacement.

Asset management risk assessment frameworks can be as simple or as complex as they need to be to consistently and comprehen-sively characterize potential risks and distinguish between available alternatives. Some of the ways utilities use risk assessment frame-works to prioritize knowledge management efforts include:

• Deciding which Standard Operating Procedures to develop for new facilities and what level of detail to include

• Focusing investments in various types of technical training modules (online, video, scenario-based) to address high-risk activities carried out relatively infrequently

• Prioritizing succession planning efforts on positions involving the highest risk and difficulty of work

• Identifying gaps between current skills and predicted future needs that could lead to reduced customer service, failure to meet safety or regulatory require-ments, increased environmental impact, and potential property damage.

Life Cycle of Knowledge AssetsKnowledge assets have a life cycle just like physical assets. Utilities have opportunities throughout the life cycle to optimize the value of their knowledge assets so they can remain successful in a changing and challenging world. (Figure 3)

Knowledge management can be practiced by integrating activities into what utilities are already doing. The use of risk frameworks already familiar to the utility helps everyone understand where knowledge

management initiatives need to fit in.

* From “Findings and Recommendations for a Water Utility Sector Management Strategy,” produced by the Effective Utility Management Steering Committee.

To discuss your utility’s knowledge management needs, contact Sharon Peters at speters@ema-inc.com.

Figure 2: Competency Model Developed by American Water Works Association and Water Environment Federation

Figure 3: Knowledge Asset Life Cycle

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Figure 1: Asset Analysis and Assessment Process Used by City of Tallahassee

City of Tallahassee, FL Underground Utilities Wastewater Treatment Division

Business Tool Helps Manage Life Cycle of Assetsby Frank Godin

As the City of Tallahassee began to plan and design a $227 million upgrade project at the Thomas P. Smith Water Reclamation Facility, the City also considered steps to improve its existing Asset Management (AM) program.

The upgrade was significant, designed to improve the nutrient removal process and provide new biosolids digestion, thickening, dewatering and drying systems. Deep bed filters and a new bleach disinfection system help the plant meet public access reuse standards.

At the same time, the City recognized it was also important to under-stand the ongoing condition, required level of service, and risk as-sociated with all assets. This information would help to determine when investments were needed to repair or replace certain assets and to track support costs and maximize their useful life.

ChallengeThe City wanted an AM program built on a systematic, data-driven process to plan and prioritize maintenance and capital improvement activities, including associated financial planning. The solution needed to achieve established, overarching strategic objectives for process man-agement and improvement and maintain an effective balance between long-term debt, asset values, O&M expense, and operating revenue.

The solution would:

• Develop standards for criticality and condition ratings for assets

• Develop asset hierarchy guidelines

• Use efficient, effective maintenance practices for its infrastructure

• Apply a consistent, rule-based business case development process

Historically, the City relied heavily on staff intuition and experience to manage its assets. The desire was to have data-based information play a greater role in supporting the asset decision making process.

SolutionThe City worked with EMA, Inc. to fortify its AM program. Early steps focused on gathering additional information on all assets to enable

better decision making and identify each asset’s remaining service life. Project team members worked with EMA to define and build a high-level asset hierarchy structure.

A criticality definition was created for assets using Reliability Centered Maintenance “Consequence of Failure” principles – a method that considers an asset’s consequence of failure from safety, environment, and opera-tions perspectives to define its criticality.

The team agreed an Enterprise Asset Management System (EAMS) was needed to

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manage all the information. The City kept its existing computerized maintenance man-agement system, as an assessment determined the system would meet the City’s AM require-ments with minor configuration adjustments.

Standards CreationHigh-level process flows for AM, maintenance, and capital planning were developed, as well as standards for work order status, priority codes, and asset status codes. EMA worked with project teams to develop and finalize detailed business process diagrams.

Business Case Tool EMA also introduced a Business Case Tool (BCT) to enable the City to validate needs, compare investment options, and prioritize a solution based on risk mitigation needs.

Knowing an asset’s current risk exposure helps the City understand where to focus its attention. The risk value is determined by conducting a criticality analysis and condition assessment to define the current consequence and probability of an asset’s failure.

If the asset’s probability and consequence of failure are low, the asset remains in its normal operating and maintenance routine, and no flags are issued. (Figure 1)

If an asset’s risk exposure is high, it triggers the business case process. In this process, the first step is to validate the risk value to ensure confi-dence moving forward. (Figure 1) If the risk is valid and action is needed, the BCT prompts the evaluation of alternatives for restoration of the asset or process function. Options include:

• Do nothing

• Do the same thing

• Operate the asset differently

• Maintain the asset a bit more

• Maintain the asset a lot more

• Repair

• Rehabilitate

• Replace in kind

• Scrap

The BCT supports life cycle cost analysis, comparing life cycle costs for each option. The analysis calculates one-time expenditures, as well as ongoing O&M costs, against the

effective life of each solution. The life cycle cost, level of risk mitigation, and life of the solution generally are sufficient to recommend restoration or improvement.

Team Member Training The City knew a team approach was important in the business case evaluation process and use of the BCT, as proper data collection, research, and analysis were critical to reach a selected solution. Interactive workshops were held, introducing best practices and core concepts to prepare project teams for active participation in the process. Coaching helped transition to the defined practices and criteria.

ResultsAfter a successful pilot program, the City implemented the new AM and maintenance strategies throughout the wastewater treatment plant and lift stations. Project benefits include:

Structured Data Gathering. Staff members now have clear protocols for ongoing data gath-ering and understand what must be captured and why. This improves overall data quality.

Data-driven CIP. Integrating the BCT with trusted data, Tallahassee can make the case for improvement projects based on validated data and universally applied risk comparison values. It also enables sound decision making to identify projects that will further the City’s strategic goals.

Alternative Evaluation. The BCT drives users to evaluate possible alternative solutions to ad-dress asset or process risk. This has produced changes in historic decision making criteria.

More Strategic Maintenance Approach. Asset data is used to make informed decisions in planning and prioritizing maintenance work.

Improved Efficiency. The AM program incorpo-rates streamlined business processes, as well as organizational structures and training, to support the program goals.

For more information on this project or to discuss your utility needs, contact Frank Godin at fgodin@ema-inc.com.

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Research Project Helps Utilities Build and Grow Their Asset Management Programs

In 2007, the Water Environment Research Foundation (WERF) began a research initiative to develop tools and practices for utilities to use to communicate and implement their own Strategic Asset Management (SAM) programs. This research concludes later this year, leaving behind a legacy – the Sustainable Infrastructure Management Program Learning Environment, or SIMPLE (http://simple.werf.org/), where subscriber utilities can access an extensive body of work that includes tools, strategies, best practices, and techniques to help them establish their own asset management programs.

EMA recently spoke with Walter Graf, Program Director at WERF about the SAM project and its impact on utilities.

What was the goal of the SAM project? The goal was to help utilities make the transition to run their operations more like a business – to realize asset management is a management model they can use to be sustainable. When I use the term “sustainable,” it means sustainability of the business itself to provide the level of service customers require while minimizing asset life cycle costs at an ac-ceptable level of risk to the utility. This includes incorporating triple bottom line analysis in decision making as the programs progress.

Did you achieve what you set out to do? Utilities are on the road to realizing they can have a truly sustainable business model. I don’t think any of them are there yet just because most utilities that are advanced in their asset management practices will tell you that they’re not where they really want to be.

The uptake of this research took a while because asset management is something you have to do over a period of time. You can’t just jump into it and have a complete program. Utilities are realizing that the external money sources are not there like they once were. This is not something that’s happened suddenly. It’s been predicted for quite some time. It is

not just a result of the way things are going in our economy. Utilities are really starting to take a hard look at ways to save money or do things more efficiently. That’s exactly where this program steps in. It shows them the research we’ve done to help them achieve this goal, especially in the area of economic decision making, which is where we are right now in the SAM challenge.

What is the impact of this research on the utility community?We did a survey a few years ago among our subscribers to see if this type of research was providing value to them, and 87 percent of the respondents said it was. Overall, the response has been positive toward everything we’ve done in this endeavor.

Utilities are becoming more sophisticated in their business. You have a changeover in personnel where people are coming in who may have more of a business background in some of the management positions. Also, the engineers in the facilities are realizing that there’s not enough money to do what they want, and there are costs keeping them from addressing their infrastructure problems. So the strategic asset management model and the research that we’ve been producing are starting to give them direction on how they can get more value out of what they do. That’s important.

As an asset-intensive industry these utilities understand they need to generate their own revenues and manage their infrastructure with a minimum of outside help. They also are starting to understand the implications of their decisions, realizing that every decision made is an investment decision, and they are starting to look at the risk of taking or not taking a certain action in their utilities.

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How has SAM research improved asset management?The body of knowledge that we have is a great start for utilities – from the SAM gap tool used for benchmarking exercises to advanced concepts and tools. It is a good basis for utilities that are starting, are not as far along as they’d like to be, or have areas where they need to improve their practices.

It is set up so they can start their asset management program gradually, which is how they have to do it. First, they need to know what they have and go from there. We always say, “you need to know the state of your assets before you start planning a way to manage them.” We have a great basis for doing that. Early on we developed communication strategies so stakeholders understand what the utilities are doing and that what they are doing has value and accept the way they work is competent, if not exceptional.

Without really top-notch researchers and the guidance of the best group of professionals in the industry who made up our Issue Area Team, none of this body of research would have been possible.

You reference the WERF SIMPLE website, also called the “knowledge base.” What would you like to share with utilities about SIMPLE and how it can serve them? Essentially, it’s an encyclopedia of asset management. There are more than 16,000 pages of information – tactics, strategies, and techniques along with tools and best practices. Considering the tools we have produced under this project that are embedded in SIMPLE, utilities have a great resource to make their own asset management program. The gap analysis is vital for any utility, whether it has an established asset management program or they’re just getting started.

The SIMPLE website includes tools, strategies, best practices, and techniques to help utilities establish and improve their own asset management programs.

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The City of Ottawa celebrated “go live” of its new enterprise asset management system in March – a significant implementation that required integration with many existing systems throughout the City.

Water, Sewer EAMS Integrates Seamlessly with City Systems

by Clyde Younkin As the City of Ottawa began the process to replace its aging maintenance management system, IBM Maximo® was identified as the business solution that would serve as the hub to link many of the City’s resources.

The legacy system, which had about 300 users organization-wide, managed the maintenance of $15 billion in water and wastewater infra-structure. The system produced more than 40,000 work orders every year for preventive and corrective maintenance and capital work and housed at least 15 years of historical data.

Implementation RequirementsThe City partnered with EMA to implement Maximo 7.5 Enterprise Asset Management and Maximo Spatial to establish an integrated Enterprise Asset Management System (EAMS). The scope of the City’s project contains 150 functional requirements that included:

• Service Request and Work Order Management

• Asset Management

• Maintenance Planning & Scheduling and PM Program

• Reporting

• Integration

• Mobile Application

• Bi-directional synchronization of asset data between GIS and Maximo each night

Integration with Many City Systems The enterprise asset management system is highly integrated, linking up with nearly every other aspect of the City. The implementation included integration with:

• Esri GIS (Maximo screens have an em-bedded GIS map that provides an easy geospatial view of assets, locations, and operational information)

• SAP business management software (con-necting to the City’s finance and inventory programs)

• Lagan CRM (connecting to service requests generated in Service Ottawa city services)

• ClickSchedule Software (enabling Customer Service Representatives to perform sophisti-cated appointment scheduling for field staff as well as direct client scheduling)

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Greater efficiency and consistency of process (best practices culture)

Improved data integrity

Moving from stand-alone applications to a fully integrated system

More advanced planning and scheduling and asset management

Migration from calendar-driven to performance/condition-based maintenance

Fully automated reporting methods

One centralized data repository that replaces siloed databases

Real-time data transfer instead of batch transfer of inspection data

Web-based applications instead of desktop applications

• Syclo mobile components for mobile in-spection of hydrants and valves with hand-held inspection units that are connected to Maximo via cellular communication

• CCTV application (video access that sup-ports maintenance and asset management)

• BIMS (leveraging drawings and “as built” documentation in the City’s document management system to view in work orders)

• AquaCIS (enabling access to the City’s water billing system, including meter reading and customer information)

• Riva EAM and Capital Planning software

Change management was a top priority for the City to ensure successful adoption of the new system.

Project goals included an organization read-iness assessment, minimization of disruptions during transition, skills development, as well as clear and frequent communication regarding the system and its benefits.

BenefitsThe City recognizes the many benefits associated with this implementation:

The City now looks to expand its mobile capabilities and commence Maximo implementations in areas that include Solid Waste as well as Bridges and Structures.

For more information on this project or to discuss your utility’s needs, contact Clyde Younkin at cyounkin@ema-inc.com.

advanced customer service in the area of payments:

Step 1: Understand your customers Managing payments effectively requires utilities to consider:• Which payment options work best for which

customer types?

• Is each payment option customer friendly?

• What is the cost for each payment option?

• Is there a way to recoup costs via fees?

• Are there options you don’t have today but should implement?

Analysis of customer behavior and choice of payment options may reveal a large percentage of customers still use the walk-in payment option. Walk-in payments are usually the highest cost payment option for the utility. While some customers desire the personal interaction provided by cashiers, many make

in-person payments because they are delinquent and want immediate confirmation that their service will not be turned off. Others may make cash payments because they do not have a checking account or rely on alternative financial services.

Step 2: Expand or strengthen customer service options Payment kiosks, now offered by some utilities, provide walk-in customers with another option. Similar to automated teller machines, kiosks can be open around the clock and may be conveniently located in a variety of locations. Kiosks can display customer bills and amount due and accept cash and checks, as well as debit and credit cards. Some kiosks also offer multilingual options.

Step 3: Create operational efficiencies Properly located and configured, payment kiosks are a win for both the customer and utility. Customers have a highly convenient and safe way to pay. Utilities offering this option often charge a convenience fee for kiosk payments and at the same time, have realized a reduction in walk- in payment processing costs and costly shutoffs for non-payment.

First in a series of customer service articles to appear in Communicator. To discuss your utility needs, contact Lynne Powers at lpowers@ema-inc.com.

Advanced Customer Service cont. from page 3

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