Strategies for managing physical assets

Asset management is a highly regarded profession throughout the world. It is a complex mix of professions, communications, information and knowledge, all combining to enable informed decision making around assets and service delivery. This ensures organisations can derive the most out of the available resources during their life-cycle.

An effective approach to managing infrastructure assets for the future is based on an understanding of the trade-offs on cost, risk and performance over the short, medium and long-term planning period.

Roads and Infrastructure spoke with Steve Verity, Principal Advisor for Asset Management at IPWEA is his synopsis of asset management practice for public works professionals in the field today, starting with addressing perceptions about the profession that can set back efficiency and create long-term complications.

What are common asset management myths?

Mr. Verity:  Resolving the embedded myths about asset management is central to the Professional Certificate in Asset Management Planning, and when our course participants learn new approaches to traditional thinking, they go back to work ready with the skills and mindset to make a profound difference to their organisations. Four commons myths addressed in our training are:

Myth 1 – Asset management is a software system used by the business.

An organisation’s asset management system is the people, processes, tools and other resources involved in the delivery of asset management. Asset management is not software. Asset management information system technology is merely a tool used by asset managers to fulfil a part of their roles and responsibilities.

Myth 2 – Asset management is maintenance management.

Asset management is not just maintenance management, or tasks required to prepare a pavement resurfacing program for example. It goes way beyond maintenance, rehabilitation or replacement programs by considering the whole-of-life cost to delivering effective and affordable services from the available resources.

Myth 3 – Asset management planning is a technical task.

Asset management planning can be best described as an art, a complex one at that. It takes a multi-disciplinary approach within a whole of organisation business framework to ensure all options and trade-offs are understood by decision-makers.

Myth 4 is – You can’t start the asset management planning process until you have all the data.

Our communities and decision-makers can’t wait for the data to be collected. The asset management planning process, as developed by the Professional Certificate in Asset Management Planning, enables informed decisions based on the information and knowledge you have at your disposal right now.

How would you summarise the desired outcome of seamless asset management and the way to attain it?

Mr. Verity: Good asset management is delivering best value for the community through effective service delivery that meet their needs, at an affordable cost. Asset managers work to find the right balance between needs and wants with cost and risk.

Managing physical assets requires a multi-disciplined approach that seek answers to drive effective decision-making:

  1. What are the levels of service and performance delivery required by my community?
    How will the demand for this change over time for example, with population movements and technological advances?
  2. What is the current state of my assets?
    Are they capable of meeting demands now and in the future? What are the risks and costs of failing to deliver?
  3. What are my best strategies for operating, maintaining, replacing and improving the assets?
  4. What are the impacts of climate change on the assets?
  5. How much will services cost the community over the long term? How am I working towards achieving intergenerational equity? How much is the community willing to pay?

A crucial output is a long-term assessment of financial needs and funding requirements to deliver the agreed service level.

Asset Managers work with the relevant decision makers to strike the right balance between costs/budgets, risk and performance.

Ultimately it is about having a long-term financial strategy to sustainably manage and deliver the agreed level of service from infrastructure.

How can asset managers prepare communities for achieving effective outcomes? 

Mr. Verity: By having a strong engagement strategy that manages expectations. Community wants can be limitless and with limited resources the greatest need must be tied to what the community is prepared to pay for. Getting this message across with quality responses requires asset managers to engage with their audiences. The ability to facilitate conversations with decision makers and stakeholders on the complex art of managing physical assets in a changing environment is a focus of the Professional Certificate in Asset Management Planning course.

Managing community expectations is important in the asset manager’s engagement strategy. Over the last few decades there has been a growing concern amongst communities about the financial sustainability of our transport, bridges, drainage, water supply and other infrastructure networks. There is increasing acknowledgment that some organisations have been making short-term decisions about investment, maintenance and renewal that may be unsustainable. At the same time, there is a need to build new infrastructure to meet growth and demand projections.

The challenge for asset managers is to facilitate conversations with decision makers on the complex art of managing physical assets in a changing environment.

Whose responsibility is it to manage assets?

Mr. Verity: Asset management is best applied when the process is opened up to multi-disciplinary practitioners; where engineers, accountants, community and environmental planners all have a say in developing the outcome. Asset managers must work collaboratively and be transparent across all areas of the business.

International best-practice has asset and financial managers working collaboratively on long-term forecasts. The value of infrastructure assets is recorded in the organisation’s audited financial statements in countries that have adopted accrual accounting.

The asset manager assists the decision-makers of community assets to consider the long-term sustainability and intergenerational equity of services.

The Australian Subcontractors Association (ASA) and Subcontractors WA (SWA) have joined forces and will now represent over 50,000 subcontractors in Australia.

Asset ownership is a responsibility of the whole organisation. Strong leadership and governance are critical factors for success that nurture links between competing priorities for the best outcomes when decision-makers are asked to balance needs and wants with cost and risk.

Who benefits from good asset management?

Mr. Verity: The community and other stakeholders benefit the most from good asset management practice, now and into the future.

Communities need the knowledge and transparency in the management of their assets to be assured they are being appropriately managed for the long term. When communities, local governments and other asset intensive organisations have the information they need to make good decisions, everyone wins.

Ultimately, asset management is not only about a technical or financial win, it is about providing the best possible value and service for communities and other stakeholders, while maintaining affordability.

Get ahead with asset management education and training

The IPWEA Professional Certificate in Asset Management Planning provides hands on experience, using your data.

Delivered online via seven 90-minute modules, live Q&A and an interactive discussion forum over nine weeks, you can complete the internationally renowned professional certificate course with an Asset Management Plan for your organisation.

More than 1500 participants from local government and asset intensive organisations around the world have benefited from the asset management training delivered by IPWEA.

The next International course begins in August 2019 followed by the Canadian course delivered through the Federation of Canadian Municipalities Municipal Asset Management Program funded by the Government of Canada, which commences in September 2019.

The certificate is recognised by the public works and engineering industry for its practical learning outcomes. Our course mentors have experience in strategic asset management of transport, development, local government, public and private infrastructure, risk management and delivery of large complex engineering projects.

Practical learning and outcomes

Designed for people who like to learn by doing, you’ll draft your asset management plan using our hands-on tools and templates while being mentored by industry experts.

The understanding gained from the experience are significant and differs to what is offered elsewhere with immediate value to your business.

Our certificate graduates will be positioned to:

  1. Master the key concepts of asset management planning;
  2. Learn how to compare asset lifecycle costs and planned budgets;
  3. Communicate the consequences, related to levels of service and risk, associated with a planned budget or long-term financial plan;
  4. Explain the role of the asset management plan related to integrated planning, including long term financial, climate adaptation and strategic plans; and
  5. Apply the IPWEA NAMS+ industry tools and templates.

Australasia and International participants can book now to commence study in August

Registration is open now for the next IPWEA Professional Certificate in Asset Management Planning course, starting on 19 August 2019. Register here.

Related stories:

Interesting? Share this article