1. Twinning project, activity 4, Maintenance assessment Tuesday 4 th October 2005, session 3 Output management: essential Instruments within ProRail By Jan Swier, ProRail, The Netherlands Tel. +31 30 235 5315. e-mail: jan.swier@prorail.nl © ProRail. All rights reserved File: g:\Js05\Slovenie\0406.Oct.3.Instruments & concession model

2. 2 Presentation contents 1.Strategic objectives of management concession 2.Translation of the objectives into internal operational instruments at ProRail: *Overview of all instruments *Brief explanation of: *Management plan, production plan, long-term renewal plan *Risk analyses and Maintenance concepts *(Principle of) Life Cycle Management 3.Statements and key questions in respect of the situation in Slovenia

3. 3 Management concession: strategic objectives Transparancy in the relationship between activities, costs and performance. Awareness of the interaction between performance by manager and operators. Awareness of the long-term effects of maintenance (LCM). Structures and systems for effectively using the insights referred to in A, B and C. ABCD

4. 4 SMART objectives The relationship between costs, activities and performance is known and applied. A relationship is established with the performance of operators Maintenance management 1 All decisions on new building alternatives and maintenance versus renewal are taken on the basis of demonstrably lowest LC costs Life Cycle Management 2 The chain of primary processes including tasks, responsibilities and authorities and internal and external interfaces is described and managed Quality assurance 3 The data for asset management, financing systems and dashboards (kpis and npis) are available, reliable and managed at a sufficient level Information 4 Instruments (including procedures) and systems for supporting asset management, financing system and dashboard are implemented Management instruments 5 ProRail has embedded professionalisation across the organisation by developing knowledge and experience, skills and behavioural aspects, based on desired standards & values and motivation. Man & organisation 6 Strategic objectives SMART objectives

5. 5 Sub-overview of instruments *Financing model *Benchmark Cost drivers *Quo Vadis; user information *Realised information on maintenance costs, renewal costs and realised lifecycle *Disruption registration *Risk analyses *Maintenance concepts / documents *LCM method for assessing alternatives *LCM method for determining economic life *Multiyear replacement plan (20 years) *Production plan (5 years) & priority matrix *Cost ratios for maintenance and renewal (RCB) *Rejection standards: specs *Object structure *Object registration/ master data *Asset register *Infrastructure atlas *Dashboard *Incentives in contracts *Project database *SAP structured and used as ERP *Social Cost-Benefit analysis for investment proposals *Monitoring

6. 6 Main instruments in the relationship chain “from contract to contacts” ProRail Infra management Government & TOCs Contractors & Consultants Policy Specifications Long-term renewal plan Production plan Risk analysis Maintenance Concepts Policy Specifications Long-term renewal plan Production plan Risk analysis Maintenance Concepts Contracts: Project contracts Process contracts Contracts: Project contracts Process contracts Contract: Management plan Management concession Contract: Management plan Management concession

7. 7 Production plan (scope: 5 years) LCC analysis Prioritisation Risk analysis inspections Input Management plan Long-term renewal plan (scope: 25 years) Necessary for planning strategic objectives and long- term financing for renewals

8. 8 Dedicated instruments and quality assurance are needed to manage performance and costs in relation to one another. RAMS specs Safety case Risk Analysis Maintenance Concept Work plan Performance targets Consequence: full process control & dedicated instruments See EN 50126 RAMS specs Maintenance Engineering Reliability- centered Maintenance RAMS specs © ProRail. All rights reserved

9. 9 Risk analyses, maintenance concepts and the production plan explicitly specify the relationship between costs, performance and departure points ‘Trade off’ Funding model Departure points Production plan -Risk Analyses -Maintenance concepts Production plan -Risk Analyses -Maintenance concepts Activity ProRail activities Setting levelEffort Indexation Performance Focus: Efficient operation of ProRail Translating the desired performance into maintenance and renewal activities: the production plan The ability to explicitly specify the relationship between costs, performance, activities and departure points: risk analyses and maintenance concepts Translating the desired performance into maintenance and renewal activities: the production plan The ability to explicitly specify the relationship between costs, performance, activities and departure points: risk analyses and maintenance concepts Costs

10. 10 Opportunities&Effects Failure duration Life Time Effect on: RAMS Costs M&R strat. ActivityCosts/ activity Sequel action failure Costs/ action M&R activities Structure of a Risk Analysis & Maintenance Concept Part Object Failure form Failure Modes Failure cause Condition of the fault Specs Minimum technical specs SAO TAO GAO SAO = Failure dependent maintenance TAO = Condition dependent maintenance GAO = use dependent maintenance Maintenance, Renewals and Inspections Risk Analysis Maintenance Concept From failure registration =

11. 11 Lowest LCC Technical life Loss of Function Controlled Loss of quality Economic Life (Growing) loss of Quality Principles of Life Cycle Cost Management LCC = Life Cycle Costs Renewal costs Maintenance costs LCC (M+R)

12. 12 The introduction of the concession model provided clarity and stability in the relationships, but also generated much work in developing new instruments and skills

13. 13 Statements on rail transport in Slovenia 1.Rail transport in Slovenia meets a huge need, in particular in goods transport. Rail infrastructure (helps to) make this possible. 2.The distribution of processes, roles, tasks and responsibilities between government, operators and rail infrastructure manager is insufficiently clear and balanced. 3.Costs, performance, departure points and activities are not coherently managed. 4.Place the management of maintenance and renewal within a single organisation. 5.Start with the strength of SZ (professional pride, involvement, unionised organisation, etc.) and build on this strength to establish a new form of professionalism. 6.Do not copy any governance model or set of operational instruments, but make your own decisions based on a strength/weakness analysis and the experiences of other rail companies. 7.According to the EU Directive, make an accounting separation between Operation and Rail infrastructure. Consider carefully whether a legal and/or economic division is desirable. 8.Do not outsource maintenance.

14. 14 Government Operation ( train operator) Passengers Forwarders Key questions for Rail Transport in Slovenia Key questions: 1.Position of the Government: choice of a governance model 2.Relationship between Rail Infra Management and Exploitation 3.Management of Maintenance & Renewal in one organisation. 4.Relationship between AZP and SZ Infra Management 5.Relationship between Management and implementation of small-scale maintenance (yes/no internal separation) 6.…….. Key questions: 1.Position of the Government: choice of a governance model 2.Relationship between Rail Infra Management and Exploitation 3.Management of Maintenance & Renewal in one organisation. 4.Relationship between AZP and SZ Infra Management 5.Relationship between Management and implementation of small-scale maintenance (yes/no internal separation) 6.…….. Contractors Engineers Renewal & Large Scale Maintenance Projects Rail Inframngt. & implementation of small-scale maintenance

15. 15 Thank you for your attention Any questions?