Water Journal : Water Journal September 2011
102 SEPTEMBER 2011 water technical features asset management Abstract Asset Management provides clear benefits to organisations that manage water infrastructure assets. However, many challenges still remain. From the author's perspective, the most challenging appears to be integrated decision making, a crucial aspect of comprehensive asset management. This paper will examine organisational structure and decision-making process from the asset management perspective. Introduction Traditionally, water infrastructure in Australia is managed by government organisations. Irrespective of their size, they are conveniently organised into functional departments such as Projects, Operations and/or Maintenance, Finance, Support Services, and so on. However, in functionally centred organisations decision making is inevitably far from seamless. This is further exacerbated by vertical management hierarchy within each department. Departmentalisation, therefore, introduces a number of issues such as poor communication, poor inter-operability, conflicting objectives, etc. In such an operating environment, there is a risk of losing sight of the big picture, which Asset Management endeavours to portray. This article is an attempt to address this issue and suggest organisational changes to bring it in line with an essential ingredient of Asset Management -- integrated decision making. Asset Management Asset Management, a tool used to manage infrastructure assets (for example, systems of transportation, energy and telecommunication networks, etc, as well as water and sewer networks, including pumping stations and treatment plants), gained momentum in the last decade or so, mainly due to: • Economic growth hinging on reliable infrastructure; • Regulatory requirements to justify asset owners' expenditure (both Capex and Opex); • Heightened customer expectations and increased public scrutiny of corporate governance (as reflected by the recently released ISO 26000, Guidance on Corporate Social Responsibility). In simple terms, Asset Management involves looking after assets from cradle to grave. It is an iterative process of planning, asset creation or acquisition (design and construction), operation and maintenance, and asset disposal with the aim to provide for community needs on a long-term basis at the lowest costs. One of the key principles of Asset Management is that it should meet the needs of the present without compromising the needs of future generations, a UN definition of sustainable development. Figure 1, therefore, puts Asset Management in that perspective. Another key principle of Asset Management is that no decision should be made without giving due consideration to its impact throughout the life cycle of an asset. It is this principle that is frequently disregarded, and one of the reasons is organisational structure of water utilities. Functionally Centred Organisations Most businesses these days are conventionally organised into functional departments, and water utilities are not an exception. Typically, they comprise a number of departments (Figure 2), such as: • Projects or Contracts: Responsible for planning, design and delivery of new water infrastructure assets. At large water utilities it is not uncommon for each of these to be a separate department. • Operations and Maintenance (O&M): In charge of O&M of assets. Frequently, O&M is split into two departments, one solely responsible for Operations and the other for Maintenance. • Finance: Responsible for both capital and operating expenditure. • Shared or Support Services: This may include Human Resources (HR), Information Technology (IT), Quality Assurance (QA) and Health, Safety Z Slavnic WATER INFRASTRUCTURE Benefits of asset management-centred organisations Figure 1. Asset Management -- the big picture. C U S T O M E R S MANAGING DIRECTOR P R O J E C T S O P E R A TIO N S M AIN T E N A N C E FIN A N C E HR, IT, QA, HSE, etc. S E R VIC E P R O VID E R S Figure 2. A functionally centred organisation.
Water Journal November 2011
Water Journal August 2011