The only way to get perspective is to stand back and see the big picture, to see individual problems in context, and our own problems in relation to others, as well as to history. Two states that chose to see the infrastructure challenges of their councils in such a context were Victoria and South Australia and they have led Australia in asset management activity and improvement.
Victoria
In 1997 the State department responsible for local government was faced with a problem. Three years earlier, rates had been cut by 20% and rate capping introduced. Many councils were petitioning to have the cap lifted to cope with growth and, especially, to renew ageing infrastructure. State Government officers were in a dilemma. Whilst they could recognise the need for renewal, they suspected some councils were ‘gaming’ the system – using the excuse of renewal to avoid reducing costs. They decided to go out to tender for a simple model that could tell them which councils really needed an increase, and if so, how much. Three of the largest consulting companies in Australia at the time said that they could produce such a model, but the State chose to go with a smaller concern that pointed out that the information needed for such a model to work – namely a knowledge of the age, economic life distribution, and estimated replacement cost of council asset portfolios – was simply not available. They proposed to fill this gap. Councils also needed this information to manage their assets more effectively. The result was the report ‘Facing the Renewal Challenge’ (1998, published 2000) which led and underpinned council asset management activities and State Government monitoring for over ten years.
South Australia
In the meantime, a group of large councils in South Australia who were trying to benchmark were frustrated by the lack of uniformity of data systems for asset information, accounting, valuation and condition assessment among the group. They chose to do a separate study under a common set of standards along the lines of the Victorian study and to widen their study to include all councils, small and large, urban and rural, and isolated. This study differed from the Victorian in two major ways – first, participation was voluntary (but, with a bit of persuasion, all took part!) and second, it used online information collection. With the information on the web, it then became possible for councils to do ‘what if’ analysis. (‘What if we extended the life of this set of assets, or increased the service levels of that set?’) The resulting report was ‘A Wealth of Opportunities’. The design and computer modelling undertaken then led to the development of IPWEA’s famous NAMS Plus asset management training, which is now a world wide program.
Penny, you mention the difficulties that the State Government and Councils faced and how the situation was improved. I remember how much intuitive sense the NAMS.PLUS approach made when I was involved in 2007 in the early days of the rollout in South Australia. But I was unaware of the historical context you record here.
I find it really interesting that a dilemma was a catalyst for the improvement. On the one hand, there was a definite need for renewal; on the other hand, there was a concern that it could be an excuse for inefficiency.
A dilemma is very often a catalyst for improvement. We would like to do one thing, but if we did, it would create another problem. We seem to be in a bind. When we describe that bind clearly, we call it a dilemma.
Sometimes, though, we are not in a total bind: we are simply being steered towards a narrow gate of opportunity. The two horns of the dilemma are guiding us to a place of insight, of enlightenment, of progress. (There has to be some space between the horns for this to happen, but there often is some space if we don’t panic.)
I remember a passage from Robert Townsend’s “Up the Organisation,” in his section “Too much vs too little”:
“A tight budget brings out the best creative instincts in man. Give him unlimited funds and he won’t come up with the best way to a result. Man is a complicating animal. He only simplifies under pressure. Put him under some financial pressure. He’ll scream in anguish. Then he’ll come up with a plan which, to his own private amazement, is not only less expensive, but also better and faster than his original proposal, which you sent back.”
Townsend’s passage has always stuck in my mind as an example that a dilemma can be healthy.
And we need to be able to deal with dilemmas. In fact, life is full of dilemmas, because life offers us few resources and many choices.
One important subject that cropped up at your Talking Infrastructure sessions in Perth, and also at the IPWEA International Conference, was the clear articulation of dilemmas in Kate Raworth’s Doughnut Economics model.
Much of our progress today is because of the solution of past dilemmas. Dilemmas are uncomfortable in the present. Maybe they are sending us important messages.