Effective asset management consists of spending the right amount of money at the right time for the right projects,” says Thomas Iseley, Ph.D., PE, professor “ and director of Construction Engineering Management Technology at Indiana University-Purdue University at Indianapolis. The process, however, becomes even more difficult when assets in question are underground and out of sight, like water and wastewater pipelines.
In one popular definition, asset management addresses these seven questions:
1. What do we have?
2. What is it worth?
3. What is its condition?
4. What do we need to do with it?
5. When do we need to do it?
6. How much will it cost?
Underground water and wastewater pipelines pose a unique challenge for asset management. That's one reason the Buried Asset Management Institute-International (BAMI-I) developed the Certification of Training in Asset Management (CTAM) program, an online course for municipal managers.
The course, which is administered by Indiana University-Purdue University at Indianapolis, is designed to help water and wastewater professionals gain infrastructure management skills as they advance through each of the program's three phases.
Phase 1 covers fundamental concepts including the study of the course manual, Guide to Water and Wastewater Asset Management. Phase 2 introduces students to the virtual CEMAM (Center of Excellence for Municipal Asset Management) program, where they can use real-world data from existing facilities to learn more about infrastructure management. In Phase 3, students become familiar with organizations, institutions, fairs, events, and other industry resources.
Beyond training utility managers, the CTAM program accomplishes additional goals:
Beginning later this year, the program is being expanded to encompass a broader range of topics. When the CTAM-Plus program is fully operational in early 2013, it will include modules on asset inventory and condition assessment, required service levels, critical assets to sustain performance, best operations and maintenance strategies, best capital improvement plan strategies, and best funding strategies.
For more information and registration, visit bami-i.com/index.html or call 330-467-7588.
7. How will we finance it?
That's a lot to ask, and underground utility managers work hard every day to come up with answers. But even if every manager had clear answers to those questions, they would still need to make judgment calls, set priorities, and assess risks to meet Iseley's standard expressed above.
What constitutes risk?
To assess and then manage risk, you need to think through what risk means. Identify the most critical aspects of your utility's service, the potential threats that could prevent their delivery, how serious or realistic those threats seem to be, and the consequences that would come from a service disruption.
Water supply and sewerage systems play important roles in protecting public health and the environment; thus they are regulated by a number of governmental entities. After 9/11 and the establishment of the Department of Homeland Security (DHS), utilities have paid greater attention to possible deliberate attacks, as well as accidents and natural disasters.
In recent years, the DHS and U.S. EPA have developed tools and guidelines to help managers set priorities and assess risks — including two free software programs: the Vulnerability Self-Assessment Tool (VSAT) and Water Health and Economic Analysis Tool (WHEAT), available at http://go.hw.net/EPAtools.
These tools help compare the cost of losing a treatment, distribution, or collection asset relative to the cost of detection, deterrence, and mitigation. When managers know these costs, they can assess a utility's vulnerabilities and plan for its protection.
Any vulnerability assessment includes two components: determining how critical the asset in question is, and determining the probability of its failing due to a particular threat, natural disaster, accident, or criminal act. The assessment process is a systematic way to understand how a given threat under specific conditions could lead to a failure severe enough to disrupt service. It also can provide a planning document to help reduce the risk of failure due to a particular condition.
To keep the process manageable, it's important to focus on assets that are so critical to continued operation that their loss is unacceptable. An asset can be highly vulnerable without being essential to your mission.
You can look at vulnerability as the probability of occurrence multiplied by the probability of total failure. This analysis can help you better gauge the value and feasibility of countermeasures you might take to deter, delay, or respond to failure.
To assess and manage risks, managers need to consider them along two dimensions: the probability of a bad thing occurring and the impact on the utility should it occur. To compare risks and set spending priorities, you'll need to quantify the frequency or likelihood of an occurrence and the consequences, as shown in Table 1 above .
You can then develop a matrix based on the ratings, as shown in Table 2 above , and use it when allocating resources. Risks that rank as extreme require immediate steps; those ranked as insignificant probably don't need further attention. For those ranked as minor, moderate, and major, you'll need to develop a business case to determine what steps if any are warranted.
In determining these steps, you'll want to consider not only the internal costs, but also the “community costs” of your decisions, which include financial, environmental, and social impacts on the communities you serve. Risk-based decision-making is a good way to enhance your agency's asset management practices.