Image by Mollyroselee from Pixabay
Before finding a solution, we first need to find the problem.
In last month’s post, I looked at two problems that we had solved. The first, insufficient housing and supporting infrastructure in the 1950s, was obvious and the solution simple. The second, asset renewal in the mid 1980s, took some finding, and the solution was far from simple, but once we understood what we had to do, we were able to do it. These are not our problems today, but what is? Fortunately, commentators on that last post have given us some clues. What do you think?
@Hein Aucamp observed that
“The first incarnation of AM tended to be asset-centric, renewal-based. Now it has moved to ever-greater levels of strategic consideration, delivering organisational value and services across an increasing set of measures, including sustainability. If AM stops taking into account emerging areas of value, it will definitely become less useful.”
Q1 Hein is right, it will. The question is, how can we know where to start and which new or emerging area to devote time to? What criteria could we use?
@Gregory Baird agreed with Hein that the AMgr’s work is broadening.
“Leaders can feel it: the work is getting more complex. Rates, regulations, climate, workforce, customer expectations — everything is moving, and everything is connected. Asset management can’t stay in its old lane”.
He suggested, “The next evolution is Integrated Infrastructure Stewardship — a holistic approach that blends financial architecture, demand behaviour, risk modelling, digital intelligence, and governance maturity into one continuous decision system. This is more than planning. It’s the operating model for the next generation of resilient cities and utilities. And it’s where the real opportunity lies for leaders who want to build systems that last.”
As exciting as this sounds, in theory, is it possible in practice? The AMgr, even the AM team, is no superman. Forty years ago, the problem was relatively simple. We knew the focus was asset renewal; we knew what we had to do, at least in principle, to get it. The Life Cycle Renewal Model gave us a tool and an approach.
Q2 Where is today’s ‘key question’ and what tools and approaches do we now need? Is the Life Cycle Renewal Model relevant to our new problems/
@Ian Greenwood challenges the idea that we have to be all things to all men. He argues,
“While the more advanced parts of AM have benefited a small group of infrastructure entities where chasing the 4th decimal point of reliability is of value, IMHO, the vast majority would benefit from just getting the basics right and avoiding the distractions of all the shiny bells and whistles.”
Q3 Do you agree? Is the ‘excitement of the new’ luring AMgrs into fields where they are able to contribute very little? And, if so, how do we, as an industry, cope with that?
@Martin Grey avoided the ‘do everything’ approach and focused on just one, ‘managing uncertainty’. He argued that
“Recognising and actively managing uncertainty is essential for making better decisions in the present and shaping more informed decisions in the future. This, of course, depends on having the right management information in place—supported by a continuous improvement capability that identifies emerging trends early, enabling timely intervention before issues escalate into incidents or crises.”
Q4 This got me thinking. I like the one-point focus, but does ‘managing uncertainty’ really depend on having ‘the right management information in place? ‘ If it truly does, we are done for. Not the least because it is probably impossible to tell in advance what the ‘right’ information is. And whatever it is, we probably don’t have it.
But surely it is right to focus on ‘continuous improvement capability’. Sounds exhausting, doesn’t it? But in the early days of asset management, that was what we were all doing.
@Philip Tiewater. His comment on the Talking Infrastructure blog is qualitatively different from the earlier comments. Philip says,
“This is a timely topic. In many cases, the infrastructure we have is not as necessary as once thought. Shifting commuting patterns, new regulations, and sea-level rise should drive more conversations about devolution (paved roads to dirt roads), repurposing (vehicle bridges to pedestrian bridges), and removal (replacing traffic signals with roundabouts) rather than life extension. The lowest-cost lifecycle decision is often not to (re)build it in the first place.”
Q5 I like this for it applies basic AM thinking to making ‘fit for the future’ AM decisions, and recognises that this applies not only to new assets but also to the replacement and modification of existing assets. What do you think?
OK. Here we have five suggestions. Where do we go from here?
My sincere thanks to Hein, Gregory, Ian, Martin and Philip.
Here is another actual event demonstrating the immediate benefits of having an AM Plan.
Free gifts are never really free. This is why Joe Brown, the ageing art dealer, was finding it so difficult to get the Victorian Government to accept his offer of an outstanding art collection worth many millions of dollars. The capital and ongoing costs associated with housing and maintaining the collection were themselves quite extensive. The quality of the collection was not in dispute but what was in dispute was the value to the Victorian community of allocating scarce resources to an art collection, resources that could otherwise be spent on health or education or any of a large number of other uses.
The decision would, of course, be influenced by the Government’s strategy for community arts at the time, as well as the nature and extent of its existing portfolio. This AM information in the Plan would help to determine what this collection could add to the total art coverage. (Remember “All strategic questions are portfolio questions”)
The Strategy and associated plans were well documented, enabling the opportunity to acquire this collection to be compared with the existing methods of meeting the State’s Art and other strategies, as documented in the Plans. This made it possible to tell whether this was a ‘wanted’ or an ‘unwanted’ gift.
Without this information, elected members were at serious risk of being emotionally blackmailed into possibly poor community decisions. Protect your agency by protecting your elected members!
What other ways can you suggest to strengthen the case for AM Plans? Please share your experiences.
Lobbyists are the bane of a CEO’s life – and an Asset Manager’s! This presents another good use for an AM Plan. Unlike last week’s story where the council was well prepared with its AM Plan, in this instance it was not. But YOU could be!
The council members had been well educated in asset management thinking and were aware that the acquisition of an old, non-heritage listed building with limited functionality was not in the best interests of the community. But how did they deal with a small, but extremely vocal and active, lobby group that was pressing them to acquire it?
At this stage their asset management plan had not yet been constructed but suppose it was, then they could have shown the lobbyists that council’s resources were fully allocated to projects which had each been justified in terms of benefits and costs to the community and they could have said:
“We appreciate your interest but here is where council resources are going. All of these projects have been carefully analysed, costed and evaluated. Provide us with a costed evaluation and the benefits of your proposal for the wider community and if the benefit:cost analysis shows that it is better than the least of our current projects we will reconsider.”
This puts the onus back on the lobbyists to estimate both costs AND benefits and this will often be sufficient to stop the lobbying pressure but if the lobby group do demonstrate greater value then council knows that it is not disadvantaging the community by agreeing to their wishes.
Some many years later the Mornington Peninsula Shire Council in Victoria actively employed this approach – very successfully.
What experience have you had that would strengthen the short term benefits case for AM Plans?
While we get better at being able to produce AM Plans, CEOs seem less willing to use them. This is not surprising when you think about it – from their point of view! They are responsible for performance today.
They know that reducing long run renewal costs is good for the community but they are acutely aware of the costs involved which they see as reducing their ability to meet today’s requirements. So let’s show them that the short term benefits outweigh the short term costs and that, therefore, the long term benefits are just sheer bonus.
Consider the following. This actually happened.
A woman tripped on a cracked footpath and her lawyer encouraged her to sue the local council. In its defence the council said that yes, many of its footpaths were ageing and in need of repair. Many other assets were also in need of attention. Council was now facing the need to replace many assets constructed during growth times some many years ago. In total, the costs of renewal were far more than the council could manage in any one year’s budget. The Community had been consulted and the council had carried out a condition audit on its footpaths. It had scheduled the worst areas for immediate attention and had a program to address the rest over a period of years. Each year, the capital works list was re-prioritised to ensure that council was allocating its scarce resources to the areas most in need. They demonstrated this by reference to council’s asset management plans and condition audits.
The judge awarded the case to the council. In his summation,he said that the council was demonstrably not negligent in the way that it was tackling its repairs and maintenance. Not only did he find for the council, but he also awarded costs against the complainant. The woman then sued her lawyer for poor advice!
How else can we sell the short run advantages of AM Plans so that organisations want them (rather than simply hammering the mandating of AM which immediately sets it up as a cost to be minimised)?
What positive short term benefits from AM plans have you experienced?
I have retired.
I thought I could never retire, but I have. I am still greatly interested in issues facing those who have to make decisions on our infrastructure but for Talking Infrastructure to continue and expand I have handed the reigns over to my younger board members and activists. They will now determine its future directions and I will watch with pride.
This does, however, free me up to turn my original website, amqi.com, created back in 1998, into something more than the redirection signpost it has been since creating Talking Infrastructure in 2016. With encouragement from our IT Director, Gregory Punshon, and our Lead Director, Ruth Wallsgrove, I am creating “Penny’s Place” on amqi.com which, when finished, will become an integral part of Talking Infrastructure. I will be unploading all 400 issues of Strategic Asset Management which were originally published between 1998 and 2014.
The SAM Issues are a great timeline of the issues and the practitioners who led the development of Asset Management over these years.
In addition, I am classifying the major articles, some 1200+ of them, to make your access easier. It is a big job and will take a few months but we will let you know when it is done.
You will be able to see what people were thinking when the practices we take for granted today were first established, why they did them and what they hoped to get out of them. You may even be able to determine where some may have gone off the rails and hopefully then be in a better position to course correct.
Of course, not all the issues we are dealing with today are old issues. Asset Management would be really boring if that were the case.
Its future history is in your hands.
This week my oldest and dearest friend, Bob Ritchie, the Secretary of the PAC, died after a valiant fight against Leukemia. I was able to see him just a few days before he passed on Tuesday last week. His influence on AM was immeasurable, but largely untold.
It was Bob who recognised, 40 years ago, the potential of the work I had done for predicting the likely cost and timing of water and sewer infrastructure renewal to be applied to all major state infrastructure and who convinced the Parliamentary Committee to engage me to do a research project where they had never done one before. He worked with me on all eight reports to Parliament and saw, where I did not, the opportunity of a vaguely defined job vacancy in public works to be converted to, as he put it, ‘anything I wanted’, which I interpreted as the opportunity to spread the AM message Australia-, and indeed, world-, wide.
A few years later he was my major support in developing the International AM Competitions and then again when I started Talking Infrastructure. He was always there, encouraging, supportive. So much he contributed! Yet hardly anyone in the AM community would know his name. True, he featured in ‘The Story of Asset Management‘ as he should, and I am glad I had the opportunity to say Thank You before he died.
Vale Bob Ritchie. 01.02.1942 – 11.03.2025
In the perennial tussle between the thinkers and the doers, I must confess that I have always been impatient with those who want to ‘get out and do’ before they have ‘sat back and thought’. They have been just as impatient with me!
I now realise that we are both motivated by the same goal – we want to avoid wasting our time.
Since I have confidence in my ability to design a suitable operational system to meet any objective, once I clearly know what that objective is, I avoid wasting time tackling the wrong objectives by sitting back and thinking about it.
The practical doers of this world do not want to waste their time thinking about objectives that may be “all very fine but not operational”. So they first insist that I show them that it can be done; then, and only then, will they be prepared to consider whether it should be done.
Recognising our common pressures, I will try to get less frustrated next time I encounter this reaction – and patiently explain ‘how’, even though I really want to get straight onto the ‘why’.
Today we seemingly all accept that we are short of time and thus feel constrained to give short shift to thought and planning. But how much of this lack of time is self-induced? How often do we need to re-do what we did in haste? Or spend time working around the problems that the haste engendered?.
Whichever camp you fall into – the thinkers or the do-ers – how do you cope with the frustration of dealing with ‘the other’ ?
Now that we have a great many courses and various trainings in asset management it is tempting to say that all asset managers should be ‘qualified’. But thinking about this I reflected on my own experience, starting from nothing, and I also remembered an interesting dinner one night when a colleague reported that his daughter had an ambition to be an asset manager like him.
“You can only do what I do, if you do what I did” replied her father, explaining that his daughter would need to do an engineering degree and further study as he had done.
“Is that really true?” asked his wife, who had home-schooled their extremely bright children. “Could she not learn by observation and questioning and work her way up from simple to more complex tasks? That is the way she has learnt everything else!”
You and me and, indeed, many asset managers have learnt much of their asset management this way. It is only within the last ten or fifteen years that we have started to teach the processes and techniques of asset management – in seminars, workshops, and in formal education.
Some of you would have a graduate degree in engineering, others would have come up through a background of construction, maintenance, finance, or property development/ management and may, or may not, have formal tertiary qualifications.
A couple of the best asset managers I have known had qualifications — but in nursing! One became Director of Capital Works in a Health Commission, the other an extremely practical policy director in the Commonwealth Government. They really understood the concept of service.
Or consider the Asset Manager I lunched with, who designed and published much sought after practical guidelines in asset management, decision making and life cycle costing, all without the background of a formal degree – just an inquiring mind, the interest to read widely, and the wit to apply what he read. He was, moreover, able to teach these techniques to others who also had no formal training and to design policy that encouraged their use. Now that IS an Asset Manager!
When we consider the number of excellent engineers we know, great at ‘doing’ things, but with little real interest in decision-making, then we would have to conclude that an engineering background may be useful but it is neither necessary nor sufficient.
“But surely we have to have properly qualified people?” Sure, but how do you qualify people to look for better ways to do what has always been done, indeed, better ways to do what they, themselves, have been taught to do? Qualifications and ability are not synonymous. We need to be more flexible and mandating certain qualifications or training will only hinder flexibility.
So yes, keep learning, get qualifications, but in a fast changing world, no set of qualifications can be allowed to be a stopping place. Or to stop us
In 2004 (Feb 14, The Buzz) ABC’s Radio National broadcast an interesting interview with an American post graduate student whose research work caused major security concerns, so much so that Richard Clarke, former White House cyberterrorism chief, declared that it should be burnt!
What did the student do to create such antagonism at security levels?
Critical Infrastructure Database
His thesis was on critical infrastructure in the United States, with a focus on information infrastructure. As part of his work in analysing the infrastructure and its vulnerabilities as preparation for determining a set of tools to deal with the vulnerabilities, the student put together an integrated database. The dataset consisted of a large collection of geo-spatial data on where the fibre optic lines were in the country, both long-haul lines that connect cities up, the metropolitan area networks within cities, switching centres and data warehouses that house and direct traffic on the network. The data carried on theses lines included a wide variety of critical sectors in the US economy and global economy including financial transactions, military command and control, emergency response, telephone calls, government communications. “Pretty much everything runs over fibre except for satellite transmissions” he said.
He worked quietly away at his research for a number of years – and by the way all of the data in his database was gathered from the public domain! – until the Washington Post wrote an article about his work, and then things started to get a little heated. Top security people then spoke with his university and wanted to know what security precautions were being taken with the database. The University asked government agencies what security precautions would be taken within their domain and then tried to replicate as best as they could within the university.
Safeguarding the Database.
This is what they did: The graduate explained “The computers that the data is housed on are not connected to any network and are in a secure room behind cipher locks. We have a vault that we take the removeable hard drives to and put them in there for storage.. and things along those lines.”
Integration
What I found interesting about this story is that as long as the data was available in a distributed form, on individual websites all over the country, there was no great hue and cry. Admittedly the student started his research in 1996, which pre-dated Sep 11.
However, the general lesson remains – integrated databases are more valuable because they allow us to do things that distributed databases don’t. In the student’s case it made it possible to analyse national vulnerabilities.
But the very act of integration introduced the biggest vulnerability of all!
Just over 10 years ago Dr Linda Newton (Canada) joined Ruth Wallsgrove, Chris Lloyd, Charles Nelson (England) and myself (Australia) in London in considering the different ways in which AM might develop. The work was then written up in Strategic Asset Management. We were only looking at developed countries then so I thought it worthwhile in asking Linda, who has now had seven years experience in applying the UN Asset Management work in developing countries what has particularly stood out for her.
Musings from Seven Years of Promoting AM in Developing Countries
By Linda Newton, PhD
I have been working with the United Nations Department of Economic and Social Affairs (UNDESA) for just over seven years now. During this time, we’ve worked with local governments in least developed countries (LDCs) to build their asset management awareness and capacity by delivering workshops based our published handbook Managing Infrastructure Asset for Sustainable Development.
If asked to provide two key takeaways from the workshops, it would be this:
- ‘Strategic’ is simply a point in the future.
- Asset management is best understood when its personalised.
How often do we see the words ‘strategic’, ‘tactical’ and ‘operational’ associated with a specific time frame? For example, many strategic plans cover 3-5 years. Now think about an individual. What does strategic mean to them? It all depends on their personal point of view. For instance, for some individuals, ‘strategic’ could be measured months, ‘tactical’ in weeks, and ‘operational’ in days, or even hours. Which brings me to the second takeaway.
I used to start the workshop by jumping right into asset management definitions and principles. For many, it was a lot of theory with no practical grounding. And then I had an idea – let’s start with personal assets. Almost everyone has, or has had, a bicycle. What comes next – a motorbike and later, perhaps a car? Different assets, delivering the same service (transportation) but at different levels and different costs. What if I used this to explain asset management? And so, ‘What I Can Learn from my Motorbike’ became the focus of the introduction to AM.
These takeaways are not unique to LDCs. Understanding an individual’s perspective and using personal examples helps position strategic asset management in terms that are understood. So, I invite you to take a look at your own organisation. Are people struggling to understand AM? If so, make it personal!
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