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Value-based Infrastructure Asset Management
IntroductionThe ISO family of standards on assetmanagement, published in 2014, broughtworldwide attention to through-life managementof physical assets, shifting the emphasis fromminimising cost to realising value.
This requires clearer determination of the valuerealised from assets and how to make value-based asset management decisions.
CSIC has developed an innovative structuredapproach to specifically help asset owners andoperators make such decisions and providemuch-needed clarity on determining the valuerealised from assets from a multi-stakeholderperspective.
Taking a value-drivenapproachCSIC has developed a structured methodologywhich applies a systematic approach thatidentifies the key stakeholders of the assets (e.g. asset owners, maintenance contractor andthe end users), their needs and requirementsfrom the asset, and how these requirements arefulfilled by the effective maintenance policiesadopted through the asset life cycle. Thisensures that the asset continues to provide thebest value for money.
Value mapping toolsThe main enabler for the new methodology is theValue Mapping Tool that facilitates easyvisualisation of key value elements. The toolprovides information regarding key factors thatinfluence the value provided by the asset andalso the levers that the asset managers can pullto manage or control the value.
The value map also helps asset managers devisemaintenance policies by taking into account thevarious possibilities and evaluate the best valueoptions. The Value Mapping Tool will besupported by mathematical modelling techniquesto determine through-life costs, risks andperformance of the assets. This will help theasset management program to maximise thevalue to the various stakeholders at the bestpossible cost.
A key benefit of this approach is that it requiresasset managers to think systematically about thedifferent ways by which asset value can bemanaged, and highlights important informationnecessary to manage the asset.
Impact“Value-based thinking removes the ‘do-what-is-absolutely-necessary’ mindset, and promotesinnovative thinking to improve value rather thansimply minimise cost. It allows the organisationto systematically identify risks and build a soundbusiness case for investment and expenditure.This is particularly relevant, even crucial, toinfrastructure, where value is generated formany years after the initial investment. Applying CSIC’s method to value-based assetmanagement positively shifts emphasis frommanaging the cost of assets to managing thevalue generated by assets.”
Ajith Parlikad, CSIC Asset Management
Transforming asset management
Asset M
anagement
[email protected] +44 (0)1223 746976www.centreforsmartinfrastructure.com @CSIC-IKC
Stage A: Establish the contextEstablishing the context is key. Assetmanagement decisions vary widely depending on the type of asset, functionality and the wide-ranging problems to be addressed. For example,strategic asset management decisions willinvolve developing whole-life valuation for aportfolio of assets to satisfy regulatorycompliance, while daily operational decisionsmay involve determining the optimal interventiontype for a particular asset.
Stage B: Develop the value map This stage clarifies the value and impending riskscontributed by the asset towards variousstakeholders requirements. Each infrastructureasset and the dependent system generate valueby providing the necessary functionality.Consequently, any failure or disruption will havean impact on the value created.
A value map is created to aid asset owners inbetter understanding the dependencies that needto be considered for a particular asset whenmaking asset management decisions. The valuemap enables organisations to understand theinformation requirements for asset managementdecision making. It can also be used to developinnovative ways of managing assets.
Stage C: Assess the valueThis stage develops an appropriate decisionmodel which calculates the value of the assetand assesses the impact of different decisionoptions on the value generated. This helps thedecision maker choose the best decision tomaximise value.
Transforming asset management
Asset M
anagement
[email protected] +44 (0)1223 746976www.centreforsmartinfrastructure.com @CSIC-IKC
Value-driven decision-making methodology – a three staged approachThe value-driven decision process consists of three stages. The figure below illustrates the various steps involved in these stages to implement whole-lifevalue process.
CSIC has successfully applied its structured approach and value-driven tools to a number of live asset management projects by collaborating with IndustryPartners including: •Value-based tunnel repair strategy for London Underground with Industry Partner London Underground•Taking a value-based approach to bridge maintenance prioritisation with Industry Partner Cambridgeshire County Council•Value-based replacement strategy for highway safety barriers with Surrey County Council
Case studies are available in the Asset Management section on the CSIC website
CSIC contact: Dr Ajith Parlikad E: [email protected]
