The continuing story of Asset Management. It is 1987 and reactions to AM information are mixed.
There was the horror of a board member of the Adelaide Hospital who, when he saw the extent of their future renewal costs, declared “My Goodness, we cannot let the board see this!” A too common response amongst those responsible for management, unfortunately.
But the Under-Treasurer was thrilled when the credit rating agencies saw the asset replacement values as indicative of the State’s wealth (ignoring our future renewal costs), and so we were able to keep our AAA rating.
In Chapter Seven of our Asset Management Story, “Reactions”, I look at the initial impact of the work of the Public Accounts Committee.
There must have been something in the ether in the mid 1980s for, almost simultaneously, major reports on future infrastructure costs were released in the UK, the USA and Australia. But Australia was the only one to focus on managing the costs.
In the UK the focus was on advising the Government of the size and costs of future infrastructure growth. In the USA, the ‘Fragile Foundations’ study included renewal, expansion and upgrade but with insufficient detail to enable these elements to be disentangled.
The aim [of the American study] was to make the figure as large as possible to convince politicians to take the matter seriously. (Later I was to meet with one of the authors of this report, an MP, and when I talked about how we might improve infrastructure decision making, she reacted negatively “If we can’t get the capital projects we want, it wouldn’t be worth going into politics!”)
Earlier I had observed that many in Australia thought that America would surely have discovered and dealt with the asset management problem ahead of us. Well, they certainly had discovered the problem. But they hadn’t dealt with it. And the reason for this is, I think, quite interesting.
America, as a rich country, was used to dealing with problems by throwing money at them, so their focus on the costs alone probably made sense. Australia, on the other hand, had no such illusions. We didn’t expect money to be easily forthcoming and knew that we would need to present a well documented case if this were to happen. We also knew priorities would need to be set. So our focus on management was understandable.
To see more, Chapter 7 has been uploaded today and Chapters 1-7 are now available at
“Have you looked at what the UK and the USA are doing?” Whenever I talked with others about our work in asset management during those early years with the Public Accounts Committee, 1985-1987, this question would commonly be voiced, generally in the tone of ‘Surely others have already done this’. But they hadn’t. One of the hardest tasks was overcoming this Australian cultural cringe. We simply couldn’t conceive of ourselves being in the lead in anything – except Sport. And yet, when it comes to asset management we have led the world. Both the UK and the USA learnt from us! How did this come about?
Nevertheless, New York was very helpful when it came to getting our message across. It became an object lesson for what might befall us if we did not get our heads around Asset Management. How come?
The answers – and many interesting New York stories – can be found in Chapter 6 of our continuing story of the development of asset management: ‘How to contain costs, asset management proper begins’.
In earlier chapters we looked at how asset management had developed from an observation that we didn’t know what it cost us to supply irrigators with water, to the more serious question that we didn’t know what it cost to supply all South Australian residents with any of their water and sewer services. In the effort to fill this information gap we made the happy discovery that our approach could not only determine what the current cost was but it would also allow us to estimate the likely future cost – and the timing – of asset renewal. We were on a roll!
Our work spread rapidly to other water authorities in the country, and shortly after, overseas. It also came to the attention of the Parliament and to their standing sub-committee, the Public Accounts Committee. In Chapter 5 we take a detailed look at what it took to expand our work to all the major state infrastructure agencies in South Australia – starting with the State Housing Commission, and moving on to water and energy, highways, hospitals, transport, and schools and colleges. So read on with Chapter 5 – Asset Management Widens its Scope.
How many times in your career have you made a change and moved on from one position to another? Probably many! Was it with relief, anxiety, excitement or something else?
When I decided to write the story of my first ten years in Asset Management as a prelude to the stories of many others over four decades, I realised that there were two stories I could tell, the story of AM development and my own personal story. At first, I thought the two should be kept separate for this seemed to be the more ‘professional’ approach. However the more I wrote, the more I realised that this was simply not possible. What is more, as I talk to others, it is not possible for them either. How do you separate your passion from the object of that passion?
So I gave up on the idea of separating the two and framed the story of ‘Asset Management as a Quest’ around the questions that I found myself asking. Each answer not only yielded more questions but it also presented new opportunities, new avenues to explore for yet more answers – and more questions! This, naturally, meant taking up new positions, or “moving on”
None of these moves was easy and the first I was to resist like crazy before eventually realising the enormous possibilities it presented. This is the story that I tell in Chapter 4 “Moving On” which I have uploaded today.
You can now access all four chapters of Part One: ‘The E&WS Years’:-
Chapter One, How Asset Management Started,Chapter Two, Looking Ahead (or predicting the cost and timing of asset renewal), Chapter Three, Reactions (where I look at how others reacted to the changes we were making) and Chapter Four, Moving On
NOW YOUR STORY!
Others tell me that as they read my stories, they remember events on their own learning path; stories of the first time they learnt something new that they now take for granted, or events they now look back on with a wry grin. This is the collective learning that Talking Infrastructure is looking to publish, both for those new to the field and for those ‘who can remember’.
The next three volumes cover the periods 1994-2003; 2004- 2013, and 2014 to 2023 respectively so no matter when you became part of the AM community, you can be part of its story. If you have something already written, great. If you are not quite sure and would like to talk about it, you can text me on 0434 406 751 or email me at penny@talking infrastructure.
Almost 40 years ago I accidentally found myself asking how we could manage our assets better. It became an all absorbing passion, always changing, ever expanding. And now Talking Infrastructure is giving me the opportunity to tell my story in ‘Asset Management as a Quest‘, the first volume in what we plan to be a 4 volume study involving the stories of many leading practitioners over the last 4 decades.
We are producing it as a serial, which is appropriate, as you will see, for Asset Management itself developed as a serial, a bit at a time, over time. Available now are the first chapters of Volume 1 ( Asset Management as a Quest): Chapter 1 which looks at how an innocent remark by one led to a lifetime of inquiry by many, Chapter 2, where we realise we can actually foretell the future (well, at least a bit), and, added today, is Chapter 3 where we look at some of the initial reactions to the changes implied by those early stages of asset management.
Here is how Chapter 3 begins – but it is better to start at the beginning with Chapter 1.
“The right time and place“
Had I tried to do this exercise anywhere else than with the EWS, I am now convinced it would not have seen the light of day. I would have been blocked by those who foresaw their current situation changing, and changing in ways they could not control.
Chief amongst these was Finance, as was later to be confirmed by the reactions of the State Treasury. There really was nothing in this exercise for Finance. They were comfortable with the way things were, they knew what they were doing, and they had ‘the power of the purse’. What I was proposing was going to shake things up.
Finance has a short term focus, mostly concerned with this budget year and next year’s budget bid. Fortunately, in the EWS, engineers were dominant and they were able to take a longer term view. They were excited to realise that their asset portfolio was so big – and thus important! So, regardless of personalities, it was natural that I would get more support from engineering than from finance. But, of course, there was more involved. There always is.”
Aneurin Hughes, Cardno, asked me this question at AM Peak last week.
It got me thinking and I realised that I never had an expectation, or long term vision, and I still haven’t. If it was hard to see the future back then, it certainly hasn’t got any easier now.
And yet, without any formal long-term planning, we have made incredible strides. Which is what makes looking back to where we started so fascinating.
I had certain things I believed in – that we needed to know WHAT we were doing, WHY we were doing it, and how much it was COSTING us – for these were necessary to make sensible decisions. These were basic so I was surprised to find so little attention to them when it came to infrastructure.
Today these same questions still apply – but now we are able to tackle them in far greater depth and complexity. And I think that ability (and the desire to apply it) is what has changed the most over the last almost four decades. Once we thought of WHAT in simplistic physical and immediate terms, now it embraces the impact we have having on the environment and on society now and into the future. The WHY question which used to be ‘what’s in it for us’ where the ‘us’ was the supply organisation, now looks further and is forcing us to have a greater understanding of the role of infrastructure beyond its mere ‘job creation’ aspects, to consider the myriad ways in which infrastructure interacts with the way we ‘live, work and play’.
The question of COSTS is perhaps the most controversial one we are dealing with today. Initially we knew almost nothing and a lot of the early development of AM focused on understanding this better. At first we just looked to the financial cost to the supply organisation and ignored those external costs that fell on users, or on the community – both now and future. These are now, at least, being discussed, but we still have some way to go before we make the necessary institutional changes that will enable the issues being discussed to be implemented. In the meantime, so many incentives remain counter-productive.
So my answer to Aneurin was, of course, ‘No’, because I had no theoretical long term vision. Instead my approach to AM was more pragmatic, more incremental, I just tackled the next problem that I could see.
QUESTION: Do you have a vision? If so, what are the next steps on the way to achieving your vision?
We have uploaded Chapter Two of ‘Asset Management as a Quest’ today.
It is now almost 40 years since Asset Management started. To celebrate, Talking Infrastructure is producing a history of the development of our discipline, now a recognised industry and moreover one for which there is excess demand.
‘Asset Management as a Quest’ is the first in this four volume series and it covers the period from 1984 to 1993. While future volumes, each covering one decade, will call on the ideas, experience and stories from many leading practioners, the first volume is told by Dr Penny Burns, and it is the story through her eyes.
Part One, consisting of 4 chapters, was first published in July 2021. It is now revised and we will be presenting the whole volume, all 20 chapters, one chapter at a time each fortnight. You can find the first chapter, ‘How Asset Management Began’ here.
Information on how you can be part of Volumes 2-4 coming shortly – so, if you have not yet joined Talking Infrastructure (it’s free!) do so, and you will be the first to be advised.
The tag line for Talking Infrastructure is ‘generating better questions’. Ruth’s brilliant last post reminded me that I had never defined a ‘better’ question. So let’s do that.
Very briefly, a ‘better’ question is one where the answer creates new information, or in the words of Michael Port (Heroic Pubic Speaking) it’s a question that Google can’t answer!
More than that, it generates new capability, allowing us to do new things, or old things in a better way.
Are these ‘better’ questions?
The first volume of our story of Asset Management, ‘Asset Management as a Quest’ consists of a search for the answers to the following series of questions. (You can read Part One of this volume – and our search for answers to the first two of these questions – here)
1: How much does it cost South Australians to get their water services?
2: What is the likely cost and timing of renewing water assets?
3: What is the cost and timing of renewal for all state infrastructure: Public Housing, Hospitals, Schools and Colleges, Highways,Transit, Power and Water?
4: What can be done to contain costs?
5: How do we instill an AM mindset?
6: How do we spread the word about asset management and its benefits?
7: What are the consequences if AM is not understood?
8: Are our tools and data up to the challenges we now face?
9: How do we advance the narrative but also keep it focused?
10: How did NSW move the story forward and what can we learn from its actions?
Q: Are these ‘better’ questions? Why or why not?
Q: What other questions were being considered in this early perid of our history (1984-1993)?
And, if you would like to know more about question asking, here are two great books
‘Questions are the Answer’ by Hal Gregersen, and
‘Curious’ by Ian Lewis (recommended by Lou Cripps after reading Ruth’s post)
Today is the 5th Anniversary of Talking Infrastructure. It was created in July 2016 to consider the new world we are now in – and the new questions this world and its challenges requires.
It is now massively evident that whereas a focus on competition to secure the success of individuals and individual companies has generated much that we enjoy today, it has also generated serious problems, of which climate change and social inequity are just the most visible.
Infrastructure – problem or solution?
While we may be reluctant to admit it – infrastructure has been a large part of the problem! Every infrastructure does considerable environmental damage. And not every infrastructure generates commensurate community benefit. A few months ago, I said’ Goodbye to our Talking Infrastructure Guy’,– and explained what was wrong with our current attitudes to infrastructure. Today he is formally replaced as our icon.
So welcome our new icon – the Australian platypus – symbolic of the collaboration we so badly need. The platypus was originally regarded as a joke, for it was considered an impossibility, being so many different animals all in one. And this version of the platypus reflecting our aboriginal culture is particularly appropriate. The Australian aboriginals are the oldest civilisation in the world sustaining the land for over 50,000 years. That’s resilience! And they have done it by a focus on community, rather than self, and a veneration for the land that supports us.
If we want a future that will support our children and theirs, we need to embed these iconic qualities of community, resilience, and sustainability in all of our decisions – and especially in our long term infrastructure decisions – from new and renewal to ongoing maintenance and even to eventual withdrawal.
What questions do we now need to ask ourselves in order to secure this future?
Hint: They are not the questions that we started with in asset management and which I discuss in volume 1 of our series, The Story of Asset Management. Consider the ten questions I pursued in the first 10 years (1984-1993) which you can find here Or, to see the questions in context, see “Asset Management as a Quest – contents”.
After you read these questions, consider to what extent we have already solved (or at least know the solution to). Then ask yourself what the questions for the next ten years should be.
I hope you have been enjoying Ruth’s platypus posts on our blog as much as I have – and reflecting on the interesting and critical question she has been exploring, namely, what does it mean to be an asset manager?
This is not a simple question to answer. Which is why it needs thinking about. I have been doing much thinking about it over the past few months as I have worked on the first volume of Talking Infrastructure’s 4 volume narrative, ‘The Story of Asset Management’.
Each of the four volumes covers one decade, starting in 1984, to be finished by the end of 2023. Each volume has its own theme:
Asset Management as a Quest. 1984-1993
Asset Management as an Opportunity. 1994-2003
Asset Management as a Discipline. 2004-2013
Asset Management as a Business (and beyond?) 2014-2023
As Ruth has shown in her recent posts, Asset Management needs a team.
Our story of asset management is the story of how those teams developed, how they came together over key ideas, how they fought with each other and supported each other – and became the very special kind of multi-disciplinary, multi-national tribe we are all part of today.