Penny will be in Melbourne this week meeting with those interested in participating in the podcasts, as researchers, publicists, administrators and/ or as on air talent. Later she will be in Brisbane, Canberra and Sydney and more information about those visits will be posted.
NOTE: Blog posts will now be on an occasional basis rather than regular twice weekly posts.
Write to penny@talkinginfrastructure.com if you would like to be invited to forthcoming podcast discussions.
How might drones affect your life cycle?
Understanding the life cycle – from asset creation to maintenance, to disposal and/or rehabilitation and reconstruction, is a fundamental concept that many need to know. But different groups need to know it in different ways. We fail to communicate if the language we speak is not the language the listener understands. So consider some of the different needs.
- Elected members and all political decision makers need to understand the impacts of life cycles in terms that they can relate to – current and future service delivery and risk. They need to know this in broad terms, but they do not need the technical details.
- Policy, planning and finance people need to understand how to measure costs and timing so that they can plan to match future revenues and expenditures, They need to understand that predictions from our models are based on ‘average’ economic life cycles. Here we face a dilemma. More closely specifying our asset groups enables more accurate descriptions which helps to determine more accurate economic life averages. But it also reduces the size of each asset group and the reliabiity of averages diminishes as the numbers in the group diminish.
- Technical people need to understand it in terms of long term optimisation rather than short term. Their knowledge need is not so much dollars as technical intervention events, e.g. maintenance or renewal.
Understanding the life cycle in all these ways is essential to ‘keeping the show on the road’, and all of the above groups have taken this as their objective.
But the ‘day after tomorrow’ requires more.
Those of us advising Infrastructure Decision Makers need to do more, we have to be able to anticipate the nature and impact of changes in the life cycle itself. Along with elected members, policy, planning, finance and technical folks, we are concerned to enable functionality today and tomorrow but, in addition, we also need to ensure that we are able to take advantage of technological options and anticipate demand changes so that we may understand the changes in the life cycle itself, arriving the day after tomorrow*.
*And for more on future change and its impact on us see the coming IPWEA event in Sunday’s weekly round up!
Our podcast partner, the IPWEA, will hold its Asset Management Congress “Communities for the Future, Infrastructure for the next generation” in Canberra, 14-16 August. And Talking Infrastructure will be there – presenting and recording.
Talking Infrastructure will be selecting key topics, ideas and speakers at this congress to appear in our Talking Infrastructure Podcast. The intention, however, is not to simply reproduce the congress in podcast form, as interesting as that might be, but rather to use the ideas presented as the core, and to augment the ideas presented by asset managers, with viewpoints from other specialists and other disciplines, in order to build up a more complex picture. We will be drawing not only from the work of the invited speakers, but also from the commentary by the audience. So be there! Be in it!
This congress has been designed to be highly interactive – see the full program details here
I hope that you have enjoyed thinking about Doug Bartlett’s Four Post series on ‘words matter’. So why not grab yourself a cup of coffee and sit down and write a comment? If you agree with the interpretation that Doug has adopted, do tell him, and tell us why. Equally, if you would have interpreted the words (and the challenge that goes with them) differently, tell us that, and why. If you have useful examples, add them.
There is plenty of scope here for comment and now there are TWO reasons for doing so.
- As a thank-you to the blog poster, a courteous acknowledgement.
- As potential for ideas, topics and speakers for our coming Podcast series
If you have not yet caught up with our news on our coming podcast, see our Weekly Roundup, Sunday July 1st. – and watch for updates in our coming Sunday round-ups.
Note:
Latest comments show up in the right hand side bar here on the front page, as well as being attached to the post itself. So add comment to any post. It doesn’t have to be the most recent to be seen.
‘Talking Infrastructure’ is about to produce a podcast series. Its focus is “rethinking infrastructure decision making for the 21st century”.
Partnership
We are delighted to welcome the partnership of the Institute of Public Works Engineering Australasia (IPWEA) in this venture.
Thinking IDM
Public infrastructure investments typically have a long life, affect large populations with diverse needs, extend over large territories, and are not only difficult (and sometimes impossible) to change or undo, but have high capital and ongoing costs, and substantial (and often insufficiently recognised) opportunity costs. For all these reasons, public infrastructure decision making has always been challenging. In other words, we have always had to think!
Rethinking IDM
But there is now an extra dimension. Change is always with us, so why do we consider 21st century change more critical? (Apart from the fact that it is where we are now!)
First there is the magnitude, rapidity and scope of change occurring simultaneously on many fronts – technological, demographic, environmental – as well as in public attitudes towards our key decision makers in government, institutions, science, finance and education.. There is a major political shift occurring across the world increasing the sense of fear and scarcity, just when technological change is increasing the opportunity for us to have hope and abundance. To which must be added the need to address cyber terrorism and the communication difficulties introduced by a post-truth world.
If ever rethinking was necessary, it is now.
Our intended audience is all who want, or need to, understand and shape the future of public infrastructure.
This includes academics, bureaucrats, politicians, and political advisors, as well as investors, financiers, and, of course, asset managers.
Keep watching, more information to come!
‘Just the facts, ma’am’ – was a catchphrase made popular by Detective Joe Friday in the TV detective show, Dragnet. The implication was that it was he, the detective, who would interpret the facts, for we do not make decisions based on the facts, but rather on our interpretation of the facts.
Interpretations can vary widely. In 1987 when the PAC revealed for the first time, the full extent of the cost of replacing all of South Australia’s public infrastructure in South Australia, I interpreted this as a liability to be planned for so I was unprepared for the State Treasurer to thank me most sincerely for ensuring that the State retained its triple A rating! A triple A rating when it was facing a quadrupling of its asset renewal within the next 15 years and had no idea of what to do about it, how was that possible? Simple: the ratings authority had been persuaded (as, unfortunately, so had the government itself) to interpret the replacement cost of assets as the ‘value’ of the assets and, since this value exceeded the measured value of the debt (ignoring future replacement considerations), all was considered to be well.
At least if the facts are clear, we can debate the interpretation (see Evidence based decision making). But what if the facts are wilfully distorted?
The ABC reported last Thursday (June 14) that 40% of infrastructure spending is now ‘off-budget’. This translates to being invisible for most. Even Saul Eslake (the former ANZ chief economist and member of the Parliamentary Budget Office’s panel of expert advisors) is reported to have ‘only noticed the scale of such spending days after the budget lock-up, as he went through the finer details in hundreds of pages of Treasury papers”. The ABC says that he isn’t the only one now paying attention – and perhaps we all should!
The Government is effectively treating this infrastructure as a ‘financial investment’ which implies a financial return. A case of wilful blindness since most of its infrastructure spending not only will not provide a financial return but will require further commitment of resources to manage and maintain.
We need to see the facts as they are, not how they have been massaged to appear. This can happen in major cases such as the above, but also in smaller ways in our own organisations.
With infrastructure, what we choose to see – and choose NOT to see- may have serious impacts for many generations to come.
This is a case to follow.
See
The Budget 2018 Sliced and Diced.
The 2018 Budget contains hidden investment time bomb
In the last post I took up Eli Goldratt’s contention that most of us are focussed on efficiency (doing what we are currently doing but doing it better) because that is what we feel we have most control over. I asked what was missing. But another way of looking at this problem is not at what is missing – but at what should be! Policies or practices that we have hung onto that are no longer serving us well in the new environment we are trying to instigate. Let’s again turn to Goldratt who argues that
“Technology can be beneficial if, and only if, it diminishes a limitation.”
This may be a limitation that we are so used to we take it as the way that life is. For example 200 years ago, travel was so slow that it was not feasible to work a full day AND also travel ten miles. This meant that if you got a job in another town you moved to that town. Today many travel much further. Workers 200 years ago would likely not have seen travel time as a constraint, it was ‘just the way that life is’. The iPhone and the Ipad were great innovations but many of us were not consciously aware of the limitations they diminished – until we got them!
The importance of limitations is that humans are intelligent. When we have a limitation we develop work arounds, rules that help us manage. But if we do not change the rules (e.g. our work practices, our policies, our regulations) we cannot get the full benefits of the innovation.
Which leads him to ask 4 questions that might be useful for you.
- What is the power of the new technology or innovation?
- What limitation does it help alleviate?
- What is the cost of the work around rule for that limitation?
- What is the new rule? and its cost?
These questions are not easily answered, especially the last one, but the more I look at them, the more critical they seem to be.
Thoughts?
The reason why we focus on efficiency is because we can. Doing what we are currently doing – only doing it better, cheaper, faster – is not only within our capabilities it is also within our responsibility levels. Effectiveness requires going beyond, looking at how what we are doing interrelates with what others are doing. Doing our thing better will fail to achieve real benefits unless we do. So while efficiency is desirable, it is not enough. Here is a case in point.
The asset management team proposed that the government build an asset register that would provide information to enable the transfer of property from departments that no longer had need for the resources to those that did. This, they argued, would enable great savings in both capital and maintenance funds. So the asset register was built. It took a number of years and cost many millions of dollars and when completed it did exactly what it was intended to do – it showed where property was underutilised and where capacity was under strain.
The expected benefits, however – the transfer of surplus property saving both capital and maintenance funds – did not arise. Why not? Because information by itself is not enough. We also need people and processes that want to and can make use of the information.
In this case no department with surplus property was willing to admit it and hand it back to the Treasury. It knew that if their demands should increase in future, getting expansionary funds would be very difficult, so there was an incentive to disguise and minimise the true extent of under-utilisation.
There was no organisational mechanism. Departments needing to expand would make the case to their Minister, usually done by proposing a specially designed facility. On approval, these departments had no incentive to settle for hand-me-down space and there was no organisational means to make it happen.
QUESTION: What project benefits have failed to materialise not because of what you did, but because of what others didn’t?
What’s new this week?
Announcement : Categories have been added to all of the posts we have uploaded so far. Existing categories are
- Understanding Infrastructure
- New Perspectives
- The Four Transitions, namely
- From Efficiency to Effectiveness
- From Sustainability to Adaptability
- From Risk to Resilience under Uncertainty
- From Growth to Prosperity for all
- The Weekly RoundUp
Explanations of these categories can be found by clicking on “Categories” in the main menu or by clicking on any of the individual categories.
Commentary; This week we have four extremely thoughtful and extensive comments by Doug Bartlett, one each to the last four posts as a start to further conversation, so join in, comment on the post or on any comment. And just a reminder to all, to see the comments associated with each post, remember to click ‘comments’ in the post menu
“We can’t let politicians make decisions, they are so irresponsible!” This was the reaction by a group of academics to the suggestion that politicians should be free to allocate their own weights to various criteria (cf last post on multiple criteria decision making)
I was first introduced to multiple criteria analysis when a UK researcher presented his work on the third Heathrow runway to a university staff seminar. The presentation was enlightening – and so was the reaction of those present. The senior public servants, who needed to get elected members focussed on the issues, were enthusiastic about the potential to present clear information not artificially constrained by dollar equivalents. But the academics were truly horrified when the presenter argued that elected members should allocate their own weights. As the people’s representatives – it was their objectives that were key.
In the last post, I asked who should be deciding on the weights. This is not a trick question but it is a difficult one. It bedevils serious public servants everywhere, staffers who desire to produce good quality ‘finished staff work’, to be able to anticipate all the problems, all the issues, all the questions, that decision makers could ask, and ensure that they have been addressed.
But this can then slip into believing that, having done all the analysis, the staffer now knows best what option should be selected and so we get the three card trick – presenting the decision makers with only three options, two of which are obviously out of consideration for cost or other reasons, so that effectively the decision makers are forced to choose what the staffer has determined.
Multiple criteria analysis, presented honestly without weights, allows decision makers to seriously and knowledgeably to consider the issue. The final decision may not be so predictable but it is likely to have their greater long term support.
On 9 September I wrote a post “Are Politician the real decision makers?” which attracted more comment than most other posts and the commentary was good. Have a look.
Also see Kim Geedrick’s comment on the last post
QUESTION TODAY IS GENERAL – YOUR THOUGHTS?
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