How Hard is it to Create an AMP?

Creating an Asset Management Plan can be simple or complex but the bottom line is you need to have one.

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December 22, 2020 | David Totman

Creating an Asset Management Plan (AMP) can be as simple or as complex as you want it to be.

Truth be told an AMP documents your journey of asset management and not so much the destination itself. Organizations with mature asset management programs typically have very complex AMPs that uphold the rigor and structure of the global standard as defined in Section 2.5.3.4 of the ISO 55000:2014 documentation. Yet having a simple AMP is better than no AMP at all. With the passing of the America’s Water Infrastructure Act (AWIA) for Community Water Systems serving drinking water to populations greater than 3,300 you kind of need one, now… Plus, every major water utility in Canada, the United Kingdom, and Australia already have theirs so it’s time we get with the program here in the US.

I’ll give you the 10 simple ingredients for creating an AMP:

  • Executive Summary
  • Introduction
  • State of Infrastructure
  • Levels of Service (LOS)
  • Demand Management
  • Risk Management
  • Asset Lifecycle Management
  • Financial strategies
  • Improvement Plan
  • Appendices

1. Executive Summary

The Executive Summary is self-explanatory in almost every business documentation. This section highlights all the major findings for Management to read, absorb, and act upon. Give Management a sense of urgency to adopt the multiple benefits of an asset management program; 1) savings, 2) trust, 3) sustainability.

2. Introduction

Again, self-explanatory yet needs to set the expectations for the report itself. Typically identifies the organizational understanding for the need of asset management. Who the organizational champions are and timelines for a phased implementation.

3. State of Infrastructure

This is the most objective section. This is the data. It includes asset counts, total length, average age, etc. Maps showing where the infrastructure is located. An assessment of the current infrastructure condition, yet more importantly identification of the critical infrastructure and criteria for criticality.

4. Level of Service (LOS)

My experience shows that determining a meaningful Level of Service (LOS) or Service Level Agreement (SLA) with your customers can be the most difficult for an organization to prioritize at the highest level. It is relatively easy to define an LOS/SLA that the Average Daily Water Pressure will be 55 PSI to the Customer as an example, but what happens if the utility fails to deliver 55 PSI, then what? These SLAs typically feed Key Performance Indicators (KPIs) in a CEO’s or General Manager’s performance plan but more importantly they should be viewed as a commitment and feedback loop to the customer. You may have heard me say before; “Assets have an intent to serve”. Pipes are put into the ground to deliver water to and collect sewage from customers. For that they pay a utility bill. It is a common business arrangement. Like any business there are expectations established and these are reflected in the LOS/SLA.

The American Water Works Association (AWWA) recently published a great benchmark study that can give you ideas of which KPIs make sense for your utility.

5. Demand Management:

This is the rich heritage of Innovyze, understanding the demand or capacity management through hydraulic modeling of your system needs. This also requires a planning component for future customer growth or decline in residential, industrial, and commercial consumptive use. The impact of alternative water sources should also be considered for resiliency.

6. Risk Management:

Classic asset management principles of calculating Total Risk. All of the components of calculating:

Risk=Consequence of Failure*Likelihood of Failure

are defined in this section. As mentioned in Step 3 above, defining the criteria for Criticality is very important in prioritizing resources. There is always the proverbial “More Need than Funding” so addressing the most critical infrastructure and remediation plans for the most critical events is paramount in allocating resources.

7. Asset Lifecycle Management

This section can be redundant and considered to be the AMP itself yet requires the most amount of asset management knowledge. For me, this provides the detailed science of why adopting asset management is important to the utility. Policy statements and Standard Operating Procedures (SOPs) are explained for the entire infrastructure life cycle; PLAN, DESIGN, BUILD, OPERATE and MAINTAIN, and not forgetting about REHABILITATE, REPLACE, or RETIRE. Details of past, present, and future infrastructure needs that guide Operating Plans and Equipment Maintenance Plans are summarized. These data also craft the Capital Planning needs. The underlying steel thread through all of the content in this section is risk-based decision criteria setting the priorities.

8. Financial strategies

Everything defined in the steps above require money. This section describes if you have enough funding, and if not, how are you going to get it. The difficult conversation of what is Capitalized and what is an O&M expense needs to be resolved once and for all. This is where “shaving the peaks and filling the valleys” of your budget portfolio comes into play. Preparing for, and to the extent normalizing the seasonal expenditures of unexpected failures is key to a confident financial strategy.

9. Improvement Plan

This is the self-help, self-awareness guide to asset management, aka continuous improvement plan for the utility. Deficiencies noted in any of the previous sections are addressed with a plan to fix or dismiss them. Minimally a plan for defining success and monitoring progress should be laid out.

10. Appendices

Like the Executive Summary, self-explanatory in any business document. However, for an AMP the Appendices can be longer than the main body of the document. What really needs to be the first Appendix is a Glossary of Terms and acronyms used in the AMP. The AWWA has a published glossary of Asset Management Definitions. Any supporting documents in the AMP should be unique to explaining the asset management approach. No need to reproduce all of your SOPs, MSDS sheets, etc.

Summary

Please note, the AMP is intended to be a living document. I’ve seen many mature asset management organizations with a great AMP that is 10 years old and seriously out of date. This is why Innovyze has built a codified workflow into our InfoAsset solution suite. Simply configuring InfoAsset with your business needs gives you a Digital AMP that updates itself with every new data refresh, within reason. “Real-time” asset management is very useful for O&M projections, yet Capital investment strategies are more long-term and only adjust to major trends.

The simple ingredients above are not an exhaustive list but they will get you started. If you have any questions, feel free to contact me at david.totman@innovyze.com.

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About the Authors

David Totman

David Totman

VP of Asset Management

 

Having been a public servant for many years, David's passion for infrastructure is exemplified throughout his experience as the VP of Asset Management at Innovyze and advisory Past-President for the Utility Engineering & Surveying Institute in the ASCE. 

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