Infrastructure asset management
Infrastructure asset management is the integrated, multidisciplinary set of strategies in sustaining public infrastructure assets such as water treatment facilities, sewer lines, roads, utility grids, bridges, and railways. Generally, the process focuses on the later stages of a facility’s life cycle specifically maintenance, rehabilitation, and replacement. Asset management specifically uses software tools to organize and implement these strategies with the fundamental goal to preserve and extend the service life of long-term infrastructure assets which are vital underlying components in maintaining the quality of life in society and efficiency in the economy.
Infrastructure asset management is a specific term of asset management focusing on physical, rather than financial assets. Sometimes the term infrastructure management is used to mean the same thing, most notably in title of The International Infrastructure Management Manual (2000, first edition). Where there is no problem of confusion, the term asset management is more widely used, as in the professional societies: the Asset Management Council in Australia, and the Institute of Asset Management in the UK. In this context, infrastructure is a wide term denoting road and rail, water, power, etc. assets.
The first published use of the term asset management to refer to physical assets is not known for sure. The earliest adopter known for certain is Dr Penny Burns in 1984 (see the Asset Management History Project ). The New Zealand Infrastructure Asset Management Manual published in 1996 is an early use of the specific term infrastructure asset management .The term "asset management" was first used in a document published in 1983by the United States Department of Transportation, Federal Highway Administration entitled: Transportation Resource Management Strategies for Elected Officials of Rural Municipalities and Counties. That document consisted of seven chapters of resource management strategies for each of two types of transportation infrastructure - roads & bridges and public transportation. Each of these two parts of the document focused on the following seven categories: Planning, Prioritization, Contracting Out, Innovative Finance, Human Resource Management, Asset Management and Performance Measurement & Reporting.
After decades of capital investment in United States's infrastructure such as the Interstate Highway System, local water treatment facilities, electric transmission and utility lines, the need to sustain such infrastructure experiences mounting challenges. The current duress includes tight state and local budgets, deferral of needed maintenance funding, and political pressures to cut public spending. Today, shrinking federal appropriations, progressively aging capital stock, and parochial statuses and interest groups have inhibited flexible procurement strategies. And with the rise of design firms, professional societies, licensures, construction and industry associations, and related specialties the management of the infrastructure system has dramatically altered. As a result the life cycle of a facility, including Planning, Design, Construction, Operations, Maintenance, Upgrading, and Replacement, has become bifurcated between agencies and firms where Design and Construction becomes contracted separately from Operations and Maintenance. The push for more dual-track strategies and not segmented ones such as Design-Build and Build-Operate-Transfer helps in maintaining public facilities. Yet, over time, the government apparatus focused more on start-up capital expenses for constructing public assets without focused monies on maintenance.
After World War II, with the policies of the Roosevelt Administration, economic boom of the 1950s, and rise in Federalism, public projects became financed through direct government funding. Additionally, the federal government began setting criteria and procedures for architects and engineers to comply on federal construction and related projects. State and local statutes soon followed suit. Over the years, a large bureaucratic machine began administering infrastructure projects through Design-Bid-Build and debt financing methods. This led to hyper-competition of federal, states, and localities over scant federal resources and overall fostered a limited approach in life-cycle attention (namely, no account of operation and maintenance). Asset management attempts to fill in the gaps of such fragmentation for better performance in infrastructure assets.
Processes and Activities
The basic premise of infrastructure asset management is to intervene at strategic points in an asset’s normal life cycle to extend the expected service life, and thereby maintain its performance. Typically, a long-life-cycle asset requires multiple intervention points including a combination of repair and maintenance activities and even overall rehabilitation. Costs decrease with planned maintenance rather than unplanned maintenance. Yet, excessive planned maintenance increases costs. Thus, a balance between the two must be recognized. While each improvement raises an asset’s condition curve, each rehabilitation resets an asset’s condition curve, and complete replacement returns condition curve to new level or upgraded level. Therefore, strategically timing these interventions will aid in extending an asset’s life cycle. A simple working definition of asset management would be: first, assess what you have; then, assess what condition it is in; and lastly, assess the financial burden to maintain it at a targeted condition.
Essential processes and activities for infrastructure asset management include the following:
- Maintaining a systematic record of individual assets (an inventory)—e.g., acquisition cost, original service life, remaining useful life, physical condition, repair and maintenance consistency
- Developing a defined program for sustaining the aggregate body of assets through planned maintenance, repair, and replacement
- Implementing and managing information systems in support of these systems—e.g., Geographic Information Systems
These processes and activities are interrelated and interdependent aspects that usually cross organizational boundaries including finance, engineering, and operations. Hence, asset management is a comprehensive approach in handling an immense portfolio of public and private capital stock. As example, in 2009, the IBM Maximo software was adopted to manage the maintenance of rolling stock and facilities for three railway systems: the Long Island Railroad, San Francisco BART system, Washington metrorail. Also, recently, wireless sensors, totaling 663, have been installed on South Korea's Jindo Bridge to detect structural cracks and corrosion. Though in a testing phase among three universities in South Korea, United States, and Japan, the use of wireless technology to may lend itself to future, cost-efficient asset management.
Politically, many legal and governmental initiatives have emphasized proactive asset management given the current state of an aging infrastructure and fiscal challenges. Recent developments include the Governmental Accounting Standards Board Statement No. 34 that required state and local entities to report in their accounting all infrastructure assets not only the privately financed ones such as water supply and utilities paid by user fees. This helps to determine an agency’s overall infrastructure asset inventory, timely assessment of physical condition, and annual projection of financial requirements. Additionally, the United States Environmental Protection Agency’s Capacity, Management, Operation, and Maintenance (CMOM) initiative works to move away from the compliance-mandate enforcement to proactive partnership with public managers to self-audit their infrastructure systems in assessing capacity, management, and operations/maintenance.
Still other proponents for proactive management include judicial consent decrees for facility managers to resolve noncompliance with environmental standards set by EPA or state environmental protection departments (i.e., laws against sewer overflows); post-9/11 security vulnerability analyses; funding legislation that specifies asset management as qualifying condition to receive/keep award; and professional organizations that are moving the industry to asset management through education, research, and workshops.
Despite the current challenges of the time’s financial constraints, one advantage is the growing availability of methodology and technology to employ asset management. But while municipalities have made significant investments and use of software tools in the last 20 years, they are mostly stand-alone systems with limited to no capability for sharing or exchanging information with other tools. Consequently, they operate in isolated silos of information across municipal departments. Data has to be re-interpreted, transformed, and reentered into different software tools several times leading to time-consuming, prone-to-error inefficiencies. Many in academia and industry recognize the need for integrated, multidisciplinary asset management that involves:
- Systemization and coordination of work processes
- Development of centralized share data repositories
- Organization of distributed software tools into modular, extensive-wide software environments
The Institute of Infrastructure Asset Management (IIAM), a U.S.-based transportation consultancy, works to promote the same issues and collaborates with other organizations, such as in the INFRAASSETS2010 conference in Malaysia, in management of public assets.
The IIAM approach to infrastructure asset management is based upon the definition of a Standard of Service (SoS) that describes how an asset will perform in objective and measurable terms. The SoS includes the definition of a "minimum condition grade", which is established by considering the consequences of a failure of the infrastructure asset.
The key components of "Infrastructure Asset Management" are:
- Definition of a Standard of Service
- Establishment of measurable specifications of how the asset should perform
- Establishment of a minimum condition grade
- Establishment of a whole-life cost approach to managing the asset
- Elaboration of an Asset Management Plan
Public asset management expands the definition of Enterprise Asset Management (EAM) by incorporating the management of all things which are of value to a municipal jurisdiction and its citizen’s expectations. Public Asset Management is the term that considers the importance that public assets affect other public assets and work activities which are important sources of revenue for municipal governments and has various points of citizen interaction. The versatility and functionality of a GIS system allow for the control and management of all assets and land-focused activities. All public assets are interconnected and share proximity, and this connectivity is possible through the use of GIS. GIS-centric public asset management standardizes data and allows interoperability, providing users the capability to reuse, coordinate, and share information in an efficient and effective manner.
In the United States the de facto GIS standard is the ESRI GIS for utilities and municipalities. An ESRI GIS platform combined with the overall public asset management umbrella of both physical hard assets and soft assets helps remove the traditional silos of structured municipal functions which serves the citizens. While the hard assets are the typical physical assets or infrastructure assets, the soft assets of a municipality includes permits, license, code enforcement, right-of-ways and other land-focused work activities. This definition of "public asset management" was coined and defined by Brian L. Haslam, President and CEO of a leading International ESRI GIS-centric computerized maintenance management system (CMMS) company located in Utah whose software is certified by the National Association of GIS-Centric Solutions (NAGCS) . GIS-centric public asset management is a system design approach for managing public assets that leverages the investment local governments continue to make in GIS and provides a common framework for sharing useful data from disparate systems. Permits, licenses, code enforcement, right-of-way, and other land-focused work activities are examples of land-focused public assets managed by municipal governments. These public assets occupy location just as in-the-ground or above-ground public assets do. Land-use development and planning is another area which is interconnected to other local government assets and work activities.
The University of St. Gallen (HSG) has launched an executive education program in infrastructure asset management (CAS Managing Infrastructure Assets (CAS MIA HSG)).
- Cagle, R. F. (2003). "Infrastructure Asset Management: An Emerging Direction". AACE International Transactions.
- Pietroforte, R. and Miller, J. B. (2002). "Procurement Methods for U.S. Infrastructure: Historical Perspective". Journal of Research, Development, and Demonstration. Pp. 425-434.
- EuDaly, K., Schafer, M., Boyd, J., Jessup, S., McBridge, A., and Glischinksi, S. (2009). The Complete Book of North American Railroading. Voyageur Press. 1-352 pgs.
- Halfawy, M. (2008). "Integration of Municipal Infrastructure Assets Management Processes". Journal of Computing in Civil Engineering, vol. 22, no. 6.
- Baird, G. M. (2011). "Money Matters: Defining Public Asset Management for Municipal Water Utilities", Journal of the American Water Works Association, Vol. 103 Iss. 5.
- Institute of Asset Management (IAM): http://www.theiam.org
- Institute of Public Works Engineering Australasia (IPWEA): http://www.ipwea.org/AM
- Asset Management Council: http://www.amcouncil.com.au
- European Federation of National Maintenance Societies (EFNMS): http://www.efnms.org
- Institute for Infrastructure Asset Management (IIAM): http://www.infrastructureinstitute.org/gateway.php