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11th National Conference on Transportation Asset Management How Internal Governance Arrangements can Influence Transportation Asset Management Implementation Wayne Francisco and Zach Rubin, GHD
Minneapolis, MN
July 11, 2016
https://en.wiktionary.org/wiki/governance
© GHD Inc. 2016
11th National Conference on Transportation Asset Management How Internal Governance Arrangements can Influence Transportation Asset Management Implementation
Asset management – beyond the legislation
Workforce Shortages
Regulatory Compliance
Customer Demands
Growth
Climate Change
Financial Constraints
Security & Emergency Response
Aging Infrastructure
© GHD Inc. 2016
11th National Conference on Transportation Asset Management How Internal Governance Arrangements can Influence Transportation Asset Management Implementation
Good governance in asset management
• Establishing a governance structure for your asset management program, providing clear policy direction on your asset management objectives
© GHD Inc. 2016
11th National Conference on Transportation Asset Management How Internal Governance Arrangements can Influence Transportation Asset Management Implementation
Good governance in asset management • Knowing the characteristics of the services you provide and determining what you need
to invest in or spend on your assets in order to expand or sustain your services
© GHD Inc. 2016
11th National Conference on Transportation Asset Management How Internal Governance Arrangements can Influence Transportation Asset Management Implementation
Good governance in asset management
• Knowing the condition of your infrastructure and demonstrating that it is performing efficiently and effectively
By Editor5807 (Own work) [GFDL (http://www.gnu.org/copyleft/fdl.html) or CC BY 3.0 (http://creativecommons.org/licenses/by/3.0)], via Wikimedia Commons
• “Understanding asset deterioration rates and impacts on service life of operations, maintenance and rehabilitation activities.”
© GHD Inc. 2016
11th National Conference on Transportation Asset Management How Internal Governance Arrangements can Influence Transportation Asset Management Implementation
Good governance in asset management
• Having spending plans that reflect reliable, confident data analysis using integrated technology solutions; and, reflect analysis of actual performance gained from previous spending
• “It is imperative that the business architecture for these solutions aligns with our EAM Policy Principles, such that accurate and accessible data is used in our life cycle asset management processes.”
© GHD Inc. 2016
11th National Conference on Transportation Asset Management How Internal Governance Arrangements can Influence Transportation Asset Management Implementation
Good governance in asset management
• Being aware of and actively managing the business risks associated with your critical assets and prioritizing investment decisions towards your significant risks
• “All risks to our infrastructure associated with natural disasters, climate change, security and other major hazards or threats and the inherent vulnerability of our infrastructure to those threats are eliminated or otherwise acceptably managed such that we sustain our desired capability to provide services.”
© GHD Inc. 2016
11th National Conference on Transportation Asset Management How Internal Governance Arrangements can Influence Transportation Asset Management Implementation
An asset management policy creates the opportunity for change
• Spending decisions need to be justified
• Getting started on changing the way spending decisions are made is problematic as the results may not be clear for many years
• Without appropriate policy direction there can be a reluctance to change
• Establishing a policy document provides department heads with the opportunity to lead change to better ways of working
“An Asset Management Policy is the cornerstone of an organization’s approach to Asset Management. As such it provides both the confidence that the organization is translating its overall organizational strategic plan into an effective Asset Management Plan, and provides the start of an organization’s ‘line of sight’, the golden thread of rationale which ultimately justifies every Asset Management activity the organization undertakes”. The Institute of Asset Management 2011 “Asset Management Landscape”
© GHD Inc. 2016
11th National Conference on Transportation Asset Management How Internal Governance Arrangements can Influence Transportation Asset Management Implementation
An asset management policy creates the opportunity for change
• Conventionally a policy establishes the ‘what and why’, in this case for the application of asset management.
• It provides the opportunity to set out the principles and commitments, and to make the organization aware of these.
• It should be a defining statement
for the organization and one that provides the direction and purpose for all that is contained in the AMS.
“The VP Operations, the VP Engineering and the VP Business Support are responsible for the
administration of this instruction in close coordination with the Executive Leadership Team. This policy shall be
implemented through our Strategic Asset Management Plan.”
• “Asset management strategies are planned and implemented such that work is undertaken on our safety critical assets and components as a first priority.”
• “Asset management strategies are planned and implemented such that sustaining or improving customer service performance is an inherent objective for every activity we undertake.”
© GHD Inc. 2016
11th National Conference on Transportation Asset Management How Internal Governance Arrangements can Influence Transportation Asset Management Implementation
An asset management policy creates the opportunity for change
“The Policy is a key reference document as we continuously improve our business processes and develop additional ISO 55001 -compliant management system documentation.” “We will annually audit and report on the implementation of this EAM Policy and respond to the findings from the audit to continually improve both the Policy and its implementation. This audit will be conducted as part of the annual audit of our EAM System, which is separately documented as our EAM System Audit and Reporting Procedure. The procedure is contained as an exhibit to this EAM Policy document.”
© GHD Inc. 2016
11th National Conference on Transportation Asset Management How Internal Governance Arrangements can Influence Transportation Asset Management Implementation
Creating an Asset Management Division to drive change
“Proper asset planning is a joint
responsibility”
“Brings pavement and bridge teams
together”
“Develop policies and procedures to
support strong asset management
approach” “Instituting
comprehensive asset management
metrics”
“Develop a Statewide Asset
Management Plan”
“Develop an Asset Management
System”
“Using performance measures to evaluate the effectiveness of our investments”
© GHD Inc. 2016
11th National Conference on Transportation Asset Management How Internal Governance Arrangements can Influence Transportation Asset Management Implementation
Creating a Program Management Office to drive change
• AM Steering Committee – Chaired by Executive Sponsor
• AM Working Committee – Chaired by Program Manager
• Program Manager leads the PMO
EXECUTIVE TEAM
AMPROGRAM
MANAGEMENTOFFICE
AMSTEERING
COMMITTEE AMWORKING
COMMITTEE
POLICYDIRECTION
PROGRAMREPORTING
COORDINATION, ALIGNMENT AND
TRAINING
ISSUES, NEEDSAND REPORTING
DEPARTMENTS
REGULATING AGENCYAM PROGRAMMANAGEMENT
OFFICE
POLICY, GUIDANCE &PROJECT APPROVALS
COORDINATION& REPORTING
OTHER AGENCIES
© GHD Inc. 2016
11th National Conference on Transportation Asset Management How Internal Governance Arrangements can Influence Transportation Asset Management Implementation
Asse
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Man
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Mai
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Man
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Prog
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and
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Con
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Acquire – Design Acquire – Install/Construct Acquire – HandoverAcquire – CommissioningAcquire – 10% Design Concept
Incorporate Into Design
Specification
2.3
Develop and Issue Design
RFP
2.4
Develop Build and Commissioning
Specification3.2
Appoint Construction
Manager
2.6
Supervise Design
Services
2.5
Finalize Assets Commissioning and Handover
5.11
Service Management RequirementsService characteristicsPerformance criteria (e.g., capacity)Security needs
6.2
Safety Management RequirementsSafety risk assessmentPublic/customer and staff safety needsPersonnel training needs
6.3
Revenue Collection and Cost Control RequirementsBusiness criticality assessmentEquipment reliability needsCost breakdown needs
6.4
Maintenance Management RequirementsReliability, Availability and MaintainabilityAsset maintenance activitiesMaintenance data and information needsMaintenance Labor, Equipment, Material & Service resources
7.2
Maintenance Testing RequirementsTest criteria for safety, reliability, maintenance and warranty compliance
7.3
Financial & Cost Control RequirementsBudget format for capital project and recurrent costsAsset depreciation approachAsset disposal planning
8.2
Procurement Planning RequirementsProcurement process – design, install/construct and manageWarehouse/spare parts planning
8.3
Personnel Planning RequirementsType and numberSkills and experiencePersonnel training needs
8.4
Target Operating Model
6.5
Target Maintenance
Model
7.4
Target Resources Model
8.5
Service Management Requirements
6.6
Safety Management Requirements
6.7
Revenue Collection and Cost Control
Requirements
6.8
Maintenance Management Requirements
7.5
Maintenance Testing
Requirements
7.6
Financial and Cost Control Requirements
8.6
Procurement Planning
Requirements
8.7
Personnel Planning
Requirements
8.8
Design Services
3.1
Installation/Construction
Services
4.1
Installation/Construction Supervision
Services3.3
As-Built Assets Documentation
4.2
Assets HandoverSignoff
5.12
Life Cycle Asset
Management Plan5.13
Brief internal stakeholders on
Conceptual Design
2.1
Incorporate requirements into development of Commissioning, Acceptance, and
Management Plan
5.5
Update Commissioning, Acceptance and
Management Plan based on Design
Solution
5.6
Project Approval Process
1.3
Update Commissioning, Acceptance and
Management Plan based on As-Built
Assets
5.7
Coordinate internal stakeholders to
develop life cycle management
requirements and owner performance
requirements5.2
Commissioning Services
4.3
Redo Commissioning
Services
4.4
Commissioning Services
3.6
Redo Commissioning
Services
3.7
Review/Redevelop Commissioning
Specification and Redo
Commissioning2.8
Commissioning Acceptance
5.10
Develop Preliminary Design
Specification
2.2
Assign responsibility to develop and deliver
Commissioning, Acceptance and
Management Plan
5.4
Develop and Issue Install/Construct
RFP
2.7
No
Maintenance Management
Plan
7.7
Resource Management
Plan
8.9
Operations Management
Plan
6.9
Agency:
Division:
Signed Off By:
Drafted By:
Location:
Date:
PROCESS NAME: GHD Inc.
Business Consulting
Dylan DesimoneMadeleine Tecci
Charlotte, NC
JUNE 28. 2016Wayne Francisco
As-Is To-BeProcess Number:
Handing Over a new Asset or Group of Assets
© GHD Inc. 2016
EXAMPLE FOR DISCUSSION ONLY
Review Commissioning
5.9
Life Cycle Asset Management
Plan
5.1
Maintenance Planning Model
7.1
Operations Planning Model
6.1
Resource Planning Model
8.1
Develop Scope for Project Proposal /
Business Case
1.2
(GATE 2)
1.4
(GATE 3)
1.5
Finalize Design and Install / Construct Services Contracts
2.9
(GATE 4)
1.6
Needs Assessment
1.1
Construction Administration and
CommissioningServices
3.4
• O&M Manual• Life Cycle Management
Strategies• Training Plan• Digital Asset Data• As-built Drawings
3.5
Approve Commissioning
5.8
Develop Preliminary Commissioning
Specification
5.3
Practical benefits from establishing internal governance arrangements This Policy applies to all aspects of our asset life cycles – from conceptual planning, initiation, design,
build/acquisition, manage/maintain and retirement/disposal phases of the lives of all of our assets.
© GHD Inc. 2016
11th National Conference on Transportation Asset Management How Internal Governance Arrangements can Influence Transportation Asset Management Implementation
Questions? Good Governance Good Management 1. Do you have a governance structure in
place that provides clear direction on your asset management objectives?
2. Do you know what level of service your infrastructure is providing and what you need to invest in or spend on your assets in order to expand or sustain your services?
3. Do you know what condition your infrastructure is in and can you demonstrate that it is performing efficiently and effectively?
4. Do you have documented spending plans that reflect reliable, confident data analysis using integrated technology solutions?
5. Are you aware of and actively managing the business risks associated with your critical assets and prioritizing investment decisions towards your significant risks?
Wayne Francisco GHD Consulting Inc. 704-342-4910 [email protected]
“Improving your asset management practices requires the application of change management techniques and a relentless focus on developing sustained performance improvements”
Zach Rubin GHD Consulting Inc. 240-206-6828 [email protected]