Improvement/Efficiency Programs
This topic covers:
Major performance objectives for planning are:
- Effectiveness, by developing strategic plans which ensure current and future assets support program delivery priorities and outcomes.
- Efficiency, by ensuring strategic asset planning occurs within agreed budget allocations and applies best practice procedures, guidelines, appropriate information systems and human and financial resources.
- Compliance, by complying with relevant policy and legislation.
Monitor planning function
Asset planners should:
- Verify that the planned targets can be measured and are relevant
- Set up procedures and assign resources to measure the performance of the planned program over time
- Review the cost effectiveness of the monitoring process.
To monitor planning, performance management information systems should support the process. In most circumstances the planning output is not realized until two years after the completion of the program that was the result of the plan. These systems should have a comprehensive structure, and be linked to the financial management system and the asset register.
Evaluate plan performance
The planner should continuously evaluate the performance of the asset strategic plans, to verify that:
- The asset strategic plans and programs support the outcomes and service delivery program
- Planning improvement strategies will address differences between the planned and actual performance
- The planning processes applied to all programs are valid and effective and provide value for money
- The planned targets are achieved and used as the basis for the current planning period
- The programs achieve their budget objectives
- All programs comply with relevant policies and legislation.
Where the performance does not meet performance targets, planners should:
- Identify the deviation from plan
- Understand the cause of the deviation
- Identify minimum acceptable performance levels.
Improve planning performance
Strategic planning improvement involves taking opportunities to improve the strengths and weaknesses of planning processes identified during the evaluation of performance.
This step is essential to ensure that the planning is responding to:
- The level of achievement of objectives
- Specific needs of users
- The asset itself.
Improvement to the asset management system
Improving the asset management systems may involve:
- Review of the asset management systems including:
- Current levels of knowledge and skills, eg training and competencies
- Current delegations including accountabilities and responsibilities
- Resourcing of HR, IT and financial programs
- Supporting management information systems
- Policies, processes and procedures
- Performance management system.
- Generating and evaluating potential solutions and/or strategies
- Developing implementation strategies
- Revising performance measures / targets
- Developing improvement targets
- Implementing strategies.
Opportunities to improve the asset management systems may affect asset level planning and local asset management systems. Therefore all improvement strategies should be fully planned and coordinated with asset managers and planners.
Review of performance targets
As part of the improvement process, performance targets should be reviewed and updated to keep them relevant and appropriate. Targets will change over time as the service delivery requirements change, as well as the asset performance.
Trends towards corporatisation and privatization have created the need to improve efficiency and effectiveness.
Corporate pressure is being applied in a number of industries. To adequately address this, benchmarking has become a very useful tool.
Through benchmarking, the organization is exposed to opportunities to move forward from dated work practices to a situation where responsiveness to existing customer needs, staff development and job satisfaction, asset performance and maintenance and overall corporate goals are being tangibly satisfied.
What is Benchmarking?
Benchmarking involves knowing who has the best practices in a particular discipline, activity or process, and then being able to apply that experience and knowledge in a meaningful context to improving your own operations.
While closely linked, it is important to distinguish between benchmarking process outputs and associated outcomes.
Outputs are linked to business processes, while outcomes arise from matching customers/clients needs and the level to which our products and services have satisfied those needs.
This also highlights the importance of differentiating between efficiency and effectiveness when benchmarking. That is, "doing things right" (efficiency) and "doing the right things" (effectiveness). This differentiation will ensure the identification and implementation of the most relevant key performance indicators (KPIs) and associate performance measurements (PMs).
The basic steps to successful benchmarking are:
- Know your operations — identify and document your business system and respective core business processes
- Know industry leaders and/or competitors
- Learn from best practices and incorporate these into your operations in a relevant way
- Continue to improve over time to gain superiority.
The purpose of benchmarking is not to control but to improve the processes and practices, and allocation of resources in order to enhance the productivity, effectiveness and efficiency of an organization. The things to monitor in benchmarking are the inputs and outputs, and the trends.
Benchmarking is a learning process, and it is generally beneficial to begin the process by applying some internal benchmarking. Once the basic system and process for benchmarking are in place they can be leveraged to achieve more effective external benchmarking.
Key elements to benchmarking
To be able to effectively benchmark we need to establish a reasonably standardised basis for comparison. One of the key challenges is in the inputs to a process, as shown below. This is due to the diversity of inputs and the uneven proportions for similar types of businesses and/or organizations; and the influence of historic input on the current situation. This could include proportional input and balance of capital and maintenance and the relative age of assets.
Generally we can standardize outputs and outcomes:
Outputs:
- Gallons/day
- Kilowatts/hour, etc.
Outcomes:
- Availability of water, power, etc.
- Cost Effectiveness of providing power, water, etc.
Inputs on the other hand can be somewhat more challenging. Inputs can be defined as:
- Physical — assets and resources required for respective processes, including buildings, plant, support equipment, etc.
- Information — needed for the process to be able to function, including safe operating parameters, system feedback information essential for effective and safe operation, etc.
- Knowledge — decision makers/operators need to input knowledge for the process to be able to function, including actions and decisions when systems go outside acceptable limits, how the system's operation is optimized, etc.
From a different perspective, benchmarking inputs for advanced asset management should examine:
The key elements of effective benchmarking lie in the following issues:
- Benchmarking must compare apples with apples. We cannot derive any great benefits from not benchmarking ourselves against appropriate averages or performance indicators.
- It is essential that the data with which we are benchmarking ourselves is developed using identical definitions, processes and calculations to derive the figures by which we are comparing performance.
- It is very easy for organizations to develop cost related performance indicators in connection with their infrastructure assets, for example:
- Operational cost per head of population served
- Operational cost per mL supplied
- Operational cost per kW/hour of power delivered or power produced.
- % of overall treatment plant compliance.
- % of efficient and biosolids reused
- Trade waste customers not complying (%).
Service reliability
- Sewer blockages (per 60 miles of sewer pipes).
- Sewerage customers — average interruption frequency.
- Sewer spills from reticulation and branch sewers fully contained within 5 hrs (%).
- Sewerage split and ERS and pump stations (%).
- Emergency calls received (nr pr 1000 customers).
- Emergency calls answered within 30 seconds (% of calls received).