1. Role of O&M in Asset Management
Rich Pinder: Asset Manager, Region of Waterloo
Roop Lutchman: Lead Business Consulting, GHD
CNAM 2014 Conference
Toronto, Ontario
May 20-23, 2014

2. Agenda Background Business Drivers & AM Program at the Region
Implementation Methodology
Approach to Asset Management
AM Elements and the Role of O&M
Results and Next Steps

3. Background The Region of Waterloo Upper Tier Municipality
3 cities and 4 townships
Population ~540,000
400+ high-tech firms, including Blackberry
Other local employers: Sun Life, Manulife, Toyota
Home to world's 2nd largest Oktoberfest celebration, after original Oktoberfest in Munich

4. Background Region of Waterloo: Over $6B in Assets: Waste Water Water
Upper Tier Municipality
Consists of 3 cities and 4 townships
Population approximately 540,000
Over $6B in Assets:
Waste Water
13 WWTP, 5PS, 2 Biosolids Storage & 1 Biosolids Transfer Facility
Water
16 WTP, 38 PS, 46 Storage, 125 Wells
Transportation
700 kilometres roadways, 169 bridges, 478 signalized intersections, 7,543 street lights
Waste Management
MRC, 2 landfills, transfer stations, waste depots
Fleet and Facilities
538 vehicles, approx buildings

5. Agenda Background Business Drivers & AM Program at the Region
Implementation Methodology
Approach to Asset Management
AM Elements and the Role of O&M
Results and Next Steps

6. Business Drivers for the Region
Internal
Customer
Demands
Workforce
Shortages
Financial
Constraints
Regulatory
Compliance
Aging
Infrastructure
Climate Change
Fiscal
Responsibility
for Taxpayer
Dollars
Growth & Demand for More Assets

7. Vision for AM at the Region
The Pilots will trial the guiding principles and processes included within the current versions of the T&ES AM Policy and Framework.
The Pilots will clearly document inputs and outputs for performance, maintenance and renewal planning and capital programming, including failure mode analysis and risk assessments.
The Pilots include performance planning including setting community objectives, identifying service levels, and developing key performance indicators for the pilot assets.
The Pilots include failure mode prediction and risk assessment for the pilot assets.
The Pilots include analysis of asset renewal and maintenance options, and analysis of capital project options using economic benefit / cost analysis.
The Pilots include staff trialing of advanced asset management practices, including processes and technology enablers.

8. Overall Goal Comprehensive Asset Management LOS RISK COS
Improved Response to Needs of Customers
Comprehensive
Asset
Management
LOS
COS
RISK
Keep Taxes and Rates Low
Continue to Deliver Service to Residents (Reduce Failures/Delays)

9. Corporate AM Timeline
2014

10. Transportation / Airport
Progress to Date
Active Participants:
Human Resources
Finance
Information Technology
Actions
Divisions
Deliverables
Transportation / Airport
Waste Management
Water Services
Facilities & Fleet
Asset Management Policy
One AM Policy
Gap Assessments
Four GAP Assessments
Asset Management Framework
One AM Framework
Performance Management Framework
One PM Framework
Data Hierarchy and Standards
Four Data Hierarchies
Asset Management Plan #1
One AM Plan +
Four
Appendices
Asset Management Pilots (4)
Four Pilots

11. Pilot Areas Waste Management MRC Ayr Wastewater Treatment Plant
Shades Mill Water Treatment Plant
Transportation

12. Agenda Background Business Drivers & AM Program at the Region
Implementation Methodology
Approach to Asset Management
AM Elements and the Role of O&M
Results and Next Steps

13. AM Implementation Methodology
LEADING CHANGE and STAKEHOLDER INVOLVEMENT
Phase 1
Phase 2
Phase 3
Step 1
Learning
Step 2
Gap Analysis
Step 3
Vision & Roadmap
Step 4
Design
Step 5
Pilot
Step 6
Rollout
Step 7
Continuous Improvement
ONGOING KNOWLEDGE TRANSFER, TRACK and REPORT BENEFITS 13

14. Knowledge Transfer to ROW Staff
ROW Staff Leads
Consultant Leads
100%
Knowledge Transfer
Involvement
Phase 1:
Education, Assessment & Strategy
Phase 2
Design & Pilot
Phase 3 -
Rollout & Continuous
Improvement 0%
Time

15. Leading Change is Key to Success
People generally resist change until the vision is so compelling that people want to go to the “new place,” or until the pain of staying the same exceeds the pain of change
Successful Change = ƒ
C - Current Situation Understanding n
V – Vision of the Desired State
S – Solution that is Believable
P – Plan for Implementation
U – Urgency to Move from the
Status Quo
Change Enablers
Sponsor
Champion
Resources
All-Way Communication
Knowledge Transfer
Rewards
Honesty
Empathy
Recognition
Early Adopters
Openness

16. Agenda Background Business Drivers & AM Program at the Region
Implementation Methodology
Approach to Asset Management
AM Elements and the Role of O&M
Results and Next Steps

17. Asset given tender loving care
Asset Lifecycle
90 -95% of Asset Life
Asset no
longer useful
New asset
Commissioned
Asset given tender loving care
Dispose
Create
Operate/
Maintain
Modify
Evaluate
Best Asset Design
and Creation
Strategy
Plan
Design
Develop Optimal
Asset Mix
Service Levels
Technology is an Enabler in Each Life Cycle Phase

18. Our AM Framework

19. Pilot – Processes Levels of Service
This is the T&ES Asset Management Framework:
Plan, Do, Measure, Support
Pilots will specifically target 5 planning processes (LOS, Failure Mode, etc.)
Levels of Service
Failure Mode Prediction & Risk Analysis
Renewal Planning
Maintenance Planning
Capital Programming

20. Renewal Planning
Determine asset remaining life based on failure modes (predictive model)
Analyse renewal options and estimated costs (Net Present Value (NPV) calculations to determine best time to refurbish/replace)
Optimize capital renewal investments

21. Failure Mode & Risk Analysis
Capacity
Physical Mortality
Financial Efficiency
Level of Service
Asset Criticality

22. Maintenance Strategic Planning
Develop maintenance options to address levels of service, failure modes and risk exposure (Reliability Centred Maintenance (RCM) tool to determine how much maintenance and at what stage in lifecycle)
Optimize maintenance investments

23. Mean Time Between Failures
Anatomy of a Failure
Failure # 1
Occurs
Maintenance Notified
Maintenance On Site
Repairs Completed
Failure # 2
Occurs
Failure # 3
Occurs
Mean Time To Identify
Mean Time To Mobilize
Wrench On Bolt Time
Mean Time To Respond
Mean Time To Repair
Mean Time Between Failures

24. PM Optimization

25. Work & Maintenance Management
W O R K F L O W
Work Initiation
Identify Asset;
Describe Work
Needed
Priority,
Estimate
Diagnosis
Requester
Planner
Work Sources
Breakdowns
Operations
SCADA
PMs
CIS
Projects
Document &
File Requests;
Review Status
Planning
Asset Details:
Specification
Criticality
Drawings
BOM
Safety needs
Repair methods
Unique tools
Resources
Materials
Labor
Services
Tools
WO No & Type
Listing of Tasks
Estimated Cost
Planner
Scheduling
Material
Availability
Net
Capacity
(people)
Tools &
Equipment
Asset
Execution
Note:
Findings
Add work
Complete
Tasks Safely
Clean Up
Start Up
Test
Hand Over
to Operator
Return:
Materials
Tools
Closeout
Document:
Reason for failure
Labor
Materials
Crew’s comments
Condition of asset
Note Follow Up Action
History
File Completed
WO with -
Pictures,
Samples,
Failed Parts
Evaluation
Review
History:
WO type
Asset
Failure
Cost,
Downtime
Labor
Planner
Supervisor
Department
Plant
etc.

26. O&M Ready Specifications
Task No.
Description
Deliverable
1.0
Reliability Centred Design (RCD) – apply reliability engineering concepts upfront in the design process to identify what assets should be run to failure, have time based maintenance, predictive maintenance and where redesign should be done to eliminate or reduce the potential for failures
Design updates based on RCD Evaluations using appropriate reliability software tools
2.0
Use operator and maintainers knowledge and experience to review designs and incorporate recommendations to improve operability and maintainability of the various assets and processes
Operations & maintenance input to draft designs – recommendations for improved operability, maintainability and interchangeability of components
3.0
Conduct HAZOP analyses to better understand and manage safety and operational risks
HAZOP outputs for design updates
4.0
4.1
Skills Development
Develop skill and competency requirements for the assets (and processes) being provided as part of the project.
Skill/Competency Gap Analysis
4.2
Develop a skills/competency gap analysis for existing staff and tailor a suitable skills development program to close these gaps
Skills Development Program

27. O&M Ready Specifications
Task
Description
Deliverable
5.0
Asset Knowledge Base Development:
5.1
Set up the asset hierarchy and tag assets accordingly (in the CMMS as well as in the field)
Asset Hierarchy, Numbering and Tagging Requirements
5.2
Set up the asset record in the core software system (e.g. CMMS) with all asset attributes to support maintenance management – e.g. static data (specifications) , preventative maintenance, condition data, risk profile, safety procedures, drawings, maintenance instructions
Asset Records – Updated with Work & Maintenance Data
5.3
Set up the asset record in the core software system (e.g. CMMS) with all asset attributes to support asset management – financial data (initial costs, replacement and insurance costs, depreciation), year installed
Asset Records – Financial Data to support PSAB 3150, Work and Asset Management lifecycle costing models
5.4
Identify all warranty requirements against the asset record in the CMMS so that failures be rectified by the right party
Warranty Information linked to Asset Records
5.5
Develop online O&M manuals (ensure hard copies)are available in the engineering and O&M libraries
On line O&M Manuals (based on leading practices)
5.6
Capture all relevant baseline data during commissioning and link them to the asset record in the CMMS
Commissioning data linked to asset records
5.7
Set up the materials management system (stores and non-stores) necessary to support the new asset base – this should include any special tools and equipment necessary to operate and maintain the assets
Materials Management Records Developed in Desired Format

28. Agenda Background Business Drivers & AM Program at the Region
Implementation Methodology
Approach to Asset Management
AM Elements and the Role of O&M
Results and Next Steps

29. Transportation Improvements
Enhanced knowledge of workflow – using Excel to set up our modelling processes before purchasing a “black box”
Setting up our current practice beside proposed pavement treatment strategies in a life cycle model (Excel) to compare costs.
Collection of pavement distress data (severity, density) to determine root causes of pavement failures, and implement preventive maintenance strategies
In the short term, we’re not using sophisticated modelling software. Instead, setting up the modeling workflow in Excel allows us to learn how all the pieces fit together before purchasing more complex software (i.e. pavement management software)
Setting up the life cycle models allowed us to compare costs of our current practice against proposed strategies.
Current practice has us assigning a surfaced condition index to each pavement section – specific distress severities/densities are not recorded. Under the new practice, we’ll collect individual distress data – we plan on doing this inspection in-house, at first.

30. Waste Management Improvements
Understanding of COF (downtime cost of failure)
Verification of current maintenance strategies using Reliability Centred Maintenance (RCM)
Optimized renewal plan based on LCCA trade-offs between:
Renewal costs
Maintenance costs
Downtime risk costs

31. Water Services Improvements
LOS: Complete population of LOS Framework
Risk & FMEA: COF/POF/FMEA worksheets
Maintenance:
Complete Basic Maintenance Planning (development of PMs based on criticality)
For High/Extreme Criticality assets – conducted RCM analysis
Renewal Planning:
Complete LCC options analysis for high risk assets
Conduct MCA for prioritizing W/WW projects

32. Fleet & Facilities Improvements
Risk: COF/POF
Maintenance:
Complete Basic Maintenance Planning (development of PMs based on criticality)
For High/Extreme Criticality assets – conducted RCM analysis
Renewal Planning:
Complete LCC options analysis for high risk assets
Conduct MCA for prioritizing

33. Overall Pilot / Project Benefits
Maintenance
Lowered O&M costs by moving more to proactive
Freeing up O&M capacity to maintain additional infrastructure
Maintenance project savings - right projects & right timing for renewal
Capital
Lowered lifecycle costs by deferring capital projects
Improved renewal programming & investment forecasting
Intangible Benefits
Improved coordination & understanding of asset lifecycle needs

34. Overall Pilot / Project Benefits
Systematic approach to Risk Management, Maintenance and Renewal Planning , LOS and Capital Planning
Validated (and revised) current maintenance program on all pilots (PM on critical assets, regular inspection, run to failure on lower risk assets)
Validated projects in current 10-year capital renewal plan and identified projects for higher risk assets not included in the plan (revised/adjusted where needed)

35. Next Steps Phase 3 – AM System (WMS and DSS)
Develop Asset Management Strategy – What do we do next?
Roll Out and Repeat Pilot Processes for other assets
Repeat AM Plan without consultant assistance to verify staff understanding of data collection and reporting processes
Improve data accuracy, reduce assumptions made and repeat AM Plan and Status Report with 2013 data
Recruit the Asset Management Office to Sustain AM Practices

36. Questions? Contact Us: Rich Pinder Asset Manager, Region of Waterloo
Roop Lutchman
Lead Business Consulting, GHD