2006313171344_asset management evaluation - lrr (12_08_05) combined

Office of the PPP Arbiter

Asset Management Evaluation Framework Final Report

© Lloyd’s Register Rail 2005 This document was prepared for the Office of the PPP Arbiter under the terms of a contract. The information herein is confidential and shall not be divulged to a third

party without the prior permission of Michael Woods, Technical Manager.

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TABLE OF CONTENTS

1. INTRODUCTION................................................................................................. 1 1.1 Background....................................................................................................... 1

1.2 Scope................................................................................................................. 1

1.3 Report Structure................................................................................................ 2

2. ASSET MANAGEMENT EVALUATION FRAMEWORK ............................ 3 2.1 Introduction....................................................................................................... 3

2.2 Overview........................................................................................................... 3

2.2.1 Asset Management Elements ................................................................... 4

2.2.2 Evaluation Tables ..................................................................................... 5

2.3 Asset Management Evaluation Process ............................................................ 6

3. SUMMARY............................................................................................................ 9

4. ISSUES FOR CONSIDERATION ...................................................................... 9

5. GLOSSARY......................................................................................................... 10

6. REFERENCES .................................................................................................... 11

© Lloyd’s Register Rail 2005 Page iii Printed: 12/08/05 Issue - 01

LIST OF FIGURES

Figure 1. Asset Management Evaluation Framework................................................... 3

Figure 2. Evaluation Tables for Process and Enabling Elements ................................. 6

Figure 3. Asset Management Evaluation Process......................................................... 7

LIST OF TABLES

Table 1. Asset Management Process and Enabling Elements ...................................... 4

LIST OF APPENDICES

Appendix A. Evaluation Tables Appendix B. Summary Table Appendix C. Element Guidelines

LIST OF ANNEXES (in supplementary document) Annex I. Development of the Asset Management Evaluation Framework Annex II. Review of Approaches to Asset Management Evaluation Annex III. Cross-reference of Elements to External Frameworks Annex IV. PPP Contract Requirements

OPPPA Asset Management Evaluation Framework Ref: 2244RWEA050812 OPPPA AMEF Final Report 01

© Lloyd’s Register Rail 2005 Page 1 Printed: 12/08/05 Issue - 01

1. Introduction

This report summarises the study undertaken by Lloyd’s Register Rail (LRR) for and on behalf of the Office of the PPP Arbiter (OPPPA) to review good practice in Asset Management evaluation and to draw on this to develop an Asset Management Evaluation Framework for the OPPPA.

The purpose of the study was to provide the OPPPA with a clear understanding of good practice in Asset Management evaluation from different industries from around the world and to use this to develop a high level framework for the evaluation of Asset Management.

In developing a high level framework based on existing approaches to Asset Management evaluation, the study has sought not to duplicate other initiatives and should be consistent with existing approaches to Asset Management evaluation.

The study has taken an inclusive approach, with each of the Infracos and London Underground consulted at regular intervals throughout, with the purpose of establishing a common understanding and to contribute to the continued development of good Asset Management.

1.1 Background The OPPPA recognised the potential value of Asset Management in reducing costs, improving performance and understanding risk and hence its importance within the London Underground Public Private Partnership (PPP). It was also aware of a number of approaches to Asset Management evaluation that either already existed or were being developed.

These approaches included the Publicly Available Specification (PAS 55) published by the British Standards Institution in May 2004 which identifies 21 key requirements for good practice in Asset Management. It was not clear to the OPPPA to what extent this would be applicable to the PPP.

London Underground had also recently sponsored work with Sarras, an Asset Management consultancy, to identify the key areas that are present in organisations that are understood to perform well in Asset Management, together with the steps that need to be taken to achieve good performance. These key areas had been shared with the Infracos in the form of a “Good Asset Management Organisation" (GAMO) matrix.

Therefore to obtain an overview of the different approaches, the OPPPA commissioned a review of recognised approaches to Asset Management evaluation, including PAS 55 and GAMO, to obtain a clear understanding of their strengths and weaknesses.

1.2 Scope The study involved a review of existing approaches to Asset Management evaluation in different industries across the world and from these a number of approaches were identified as being the most complete and comprehensive.



These approaches were analysed to find the common components of Asset Management evaluation, resulting in the identification of 12 high level elements, which together are necessary for good Asset Management1. These 12 elements were structured into a simple Evaluation Framework.

The study looked at how the different approaches measure proficiency in Asset Management, and from this developed a ‘maturity’ based approach to allow evaluation of each of the 12 elements. Guidance is provided for each of the elements, together with evaluation tables through which proficiency in each element can be determined.

1.3 Report Structure The report is written in two volumes, which together contain the Asset Management Evaluation Framework as well as the supporting information and analysis.

The first volume contains the main report with the Asset Management Evaluation Framework together with a summary table of the 12 elements and evaluation tables for assessing the maturity of an organisation’s Asset Management. Detailed guidelines for each element are provided in the appendix to the main report.

The second volume contains the annexes to the main report which contain all the supporting analysis and information used in the development of the Evaluation Framework.

• Annex I. Development of the Asset Management Evaluation Framework.

• Annex II. Review of Approaches to Asset Management Evaluation. • Annex III. Cross-reference of Elements to External Frameworks. • Annex IV. PPP Contract Requirements.

1 Therefore within this report ‘good Asset Management’ is defined as proficiency in each of the 12 elements which were identified through a review of recognised approaches to Asset Management evaluation.



2. Asset Management Evaluation Framework

2.1 Introduction The approach to Asset Management evaluation outlined in this report is based on existing and recognised approaches to evaluation. It draws out 12 high level elements that together comprise good Asset Management and suggests for each of these elements a number of key areas and supporting guidance. The framework also recommends which of the recognised evaluation approaches reviewed offer the most extensive guidance for each of the elements. The framework provides a ‘maturity’ based approach to evaluation, allowing measurement of Asset Management proficiency based on knowledge and competent professional judgement. This approach is equally suited to both self-assessment and third party review.

2.2 Overview Figure 1 below illustrates the structure of the Asset Management Evaluation Framework presented in this report.

vvv

Guidance

Key Areas...

Level 1

Key Areas...

Level 1

Key Areas...

Level 1

Key Areas...

Level 1

Key Areas...

Level 1

Key Areas...

Element

Process Elements

Link to External Frameworks

Enabling Elements

Key Areas...

Level 1

Key Areas...

Level 1

Key Areas...

Level 1

Key Areas...

Level 1

Key Areas...

Level 1

Key Areas...

Element

Asset Management Evaluation FrameworkAsset Management Evaluation Framework

Proc

ess

Elem

ent

Eval

uatio

n Ta

ble

Enabling Element

Evaluation Table

Summary Table

Figure 1. Asset Management Evaluation Framework

The Evaluation Framework comprises two parts:

• 12 Asset Management elements which encompass an organisation’s Asset Management, all of which should be considered in an evaluation of Asset Management practice,

• Evaluation tables which should be used for the evaluation of an organisation’s maturity against each of the 12 elements.

For each of the elements the Evaluation Framework identifies a number of key areas which provide more detail on the important components of that element,



together with some supporting guidance. For ease of use, the report contains a summary table in Appendix B containing, for each element, the key areas and a brief summary of the guidance in the form of main considerations. The full guidance is provided Appendix C.

The output from the Evaluation Framework is a level from 0 to 5 (with 5 being the highest) for each of the 12 Asset Management elements, giving an indication of an organisation’s maturity in these 12 areas. The evaluation tables containing the criteria for each of the levels is provided in Appendix A.

2.2.1 Asset Management Elements The Asset Management Evaluation Framework presented in this report comprises 12 elements, all of which should be considered in an evaluation of Asset Management practice. Six of these elements relate to an organisation’s Asset Management processes, based around the management system ‘Plan, Do, Check, Act’ approach. The other six elements relate to the way an organisation is managed, and are essential to enable good Asset Management to exist. The 12 elements are shown in Table 1 below.

Process Elements Enabling Elements

• External Influences

• Planning

• Delivery

• Review

• Information Management

• Risk Management

• Active Leadership

• Continuous Improvement Management

• Responsibility, Authority and Accountability

• Competency

• Communications

• Explicit Model

Table 1. Asset Management Process and Enabling Elements

There is no hierarchy to the elements, with all of them recognised as necessary for good Asset Management. However, it will be necessary for an organisation to determine how that element should be developed most appropriately and to which level.

Therefore, a number of more detailed key areas are identified that should be considered within each element. These key areas are not meant to be prescriptive, but rather clarify the important aspects of Asset Management that should be considered to ensure that all relevant aspects are covered within the 12 elements.

For each of the key areas, further information is provided in the form of main considerations and guidance. For convenience, the summary table in Appendix B contains an overview of the 12 elements, listing the key areas and the main considerations for each, with the guidance provided in Appendix C.



The guidance is included to provide further information on what should be considered in the evaluation of Asset Management within an organisation. The guidance provided is a distillation of the good practice identified in the approaches to evaluation reviewed as part of this study, supplemented by an internal Lloyd’s Register Rail workshop review2.

The review of approaches to Asset Management evaluation identified information and knowledge on which practices and processes are recognised as important in achieving proficiency in each of the elements. This information is included in the guidance to each element, with the Evaluation Framework providing references from each key area to the external approaches which provide the most comprehensive and complete guidance.

Four of the external frameworks are identified as containing complete and comprehensive guidance which it would be valuable to consider. These were the AASHTO Transportation Asset Management Guide, the Austroads Integrated Asset Management Guidelines, the International Infrastructure Management Manual (IIMM) and PAS 55. Where one of these frameworks provides extensive guidance on a particular element, the relevant clause or section is also identified.

This should allow the Evaluation Framework to be used as a guide to the different evaluation approaches that exist while also providing substantial guidance, drawn from these approaches, in the framework itself.

Annex II contains a summary of each of the approaches to Asset Management evaluation reviewed and Annex III provides a cross-reference of each of the 12 elements in the Evaluation Framework to the guidance provided in the reviewed approaches.

A cross-reference from the Asset Management related PPP contract requirements to each of the elements is provided in Annex IV. The annexes are provided in a separate volume.

2.2.2 Evaluation Tables

The report also contains a methodology by which the Evaluation Framework could be used to measure the maturity and proficiency of an organisation’s Asset Management. The measurement methodology takes an approach by which the maturity of the organisation can be assessed for each element. The framework provides two evaluation tables – one for the process elements and one for the enabling elements. These provide a guide to how an organisation could be assessed on a scale of 0 to 5 for each of the elements and are illustrated in Figure 2 overleaf.

The evaluation tables provide an explanation of what would be expected of an organisation in order to achieve a particular maturity for any given Asset Management element. Taken together these evaluations provide an overview of the maturity of the Asset Management overall within an organisation.

2 The internal Lloyd’s Register Rail workshop involved individuals with experience in Asset Management gained as duty holders in transport and other industries, experience in the verification of Asset Management systems and with research experience in academia.



The approach does not suggest that every organisation ought to achieve or even wish to achieve the highest level for each element. The organisation to be assessed should determine the appropriate level of Asset Management performance that it wishes to achieve for any particular element at any point in time.

Level 5Level 4Level 3Level 2Level 1Level 0

Level 5Level 4Level 3Level 2Level 1Level 0

ExternalInfluencesExternal

Influences PlanningPlanning DeliveryDelivery ReviewReview Inform.Mgmt

Inform.Mgmt Risk MgmtRisk Mgmt

Process Elements

ProcessEvaluation

Table

EnablerEvaluation

TableActive

LeadershipActive

LeadershipCont. Impr.

Mgmt.Cont. Impr.

Mgmt.Resp. Auth.

Account.Resp. Auth.

Account. Compet.Compet. CommsComms ExplicitModel

ExplicitModel

Enabling Elements

Figure 2. Evaluation Tables for Process and Enabling Elements

The purpose of the maturity approach is that this allows an informed judgement of an organisation’s proficiency in Asset Management. It does not take a checklist approach by which each element or sub-element is accounted for as present or not, providing an assessment of what is done, rather than why and how it is done. The maturity approach considers whether the approach to each of the elements of Asset Management is undertaken in a consistent and sustainable way that is effective and appropriate for the organisation. It also ensures that all activities are linked back to the delivery of the organisation’s overall business objectives.

Appendix A contains the evaluation tables which are used to assess the Asset Management processes and the Asset Management enablers respectively. Although they both follow the same structure and approach, they provide a different definition of each of the competence levels based on the different nature of the Asset Management processes and their enablers.

2.3 Asset Management Evaluation Process It is proposed that the Framework would be used to evaluate Asset Management following the process outlined in Figure 3 overleaf, which shows the different steps in the evaluation process.



Overview of organisation’s Asset Management maturityOverview of organisation’s Asset Management maturity

Evaluateorganisation

against element

Evaluateorganisation

against element

• Key Areas• Main Considerations• Guidance

• Key Areas• Main Considerations• Guidance

Determine maturityand proficiency for

element

Determine maturityand proficiency for

element

Eval

uatio

nTa

bles

Eval

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bles

Figure 3. Asset Management Evaluation Process

Therefore, the evaluation process involves the evaluation of the level of maturity of an organisation in each of the 12 elements against the levels identified in the evaluation tables (see Appendix A). The evaluation will assess the performance of the organisation in the key areas, taking into account the guidance and main considerations.

The assessment of the level of maturity in each of the 12 elements requires a methodical approach. Any evaluation that is undertaken should assess an organisation against all of the elements within the framework. Each element should be evaluated against the corresponding evaluation table.

While the evaluation of each element would be carried out based on the key areas, main considerations and guidance it is advised that an organisation looks beyond this to the guidance and information provided in the recommended external frameworks. This will provide an improved understanding of what should be included or considered for each element.

This approach offers itself well to both self-assessment and third party review, but in both cases relies on the knowledge and experience of the assessor. Therefore it is essential that any evaluation is carried out by competent and knowledgeable individuals and it is suggested that these would be experienced auditors. This requires a full understanding of the specific frameworks adopted by the organisation being assessed applicable to the element in question. It also requires the assessors as a minimum to be competent in internal audit process and to be sufficiently independent of the area under assessment to ensure objectivity.

An assessor is required to determine a level of maturity against each element. In order to achieve this, it is recommended that an assessor:

• seeks positive evidence that the organisation has defined and adopted a particular Asset Management approach (e.g. PAS 55),



• establishes that the Asset Management approach has been properly interpreted and associated processes and other requirements of the approach have been properly designed,

• seeks positive evidence that the system as designed has been properly applied to the element concerned,

• identifies which of the maturity levels is robustly supported by the evidence seen.

Based on the key areas, main considerations and guidance, together with identified external guidance, the assessor can use the measurement tables to determine a level for each of the elements.

An organisation can consider its maturity in each of the elements and decide whether this is appropriate for its business and whether it needs to improve. When taken together, the level determined for each of the elements provides an overview of an organisation’s general maturity and proficiency in Asset Management.



3. Summary

This report proposes a high level framework for the evaluation of Asset Management based on 12 elements present in recognised existing approaches to evaluation. For each of these elements, the Evaluation Framework identifies a number of key areas, as well as providing guidance and references to the external frameworks which provide the most extensive guidance for each element.

The framework is based on a review of good practice in Asset Management evaluation from around the world, including PAS 55 and GAMO, and has identified common elements and approaches.

The study has taken an inclusive approach, with each of the Infracos and London Underground consulted at regular intervals throughout, with the purpose of establishing a common understanding between OPPPA, London Underground and the Infracos and to contribute to the continued development of good Asset Management.

4. Issues for consideration

The proposed framework draws and builds upon a number of established approaches that have been developed over a number of years. However although this provenance exists, the overall approach has not been validated within the constraints of this study. Therefore it is suggested that the OPPPA might wish to consider a pilot exercise involving a small number of the framework elements to the test the robustness of the methodology and to learn lessons for its wider application.

The approach to the Asset Management Evaluation Framework proposed in this study is non-prescriptive and as such allows an organisation to adopt the most appropriate approach or approaches. However, if the Infracos do adopt different approaches to Asset Management, the OPPPA should consider how they might benchmark Asset Management performance of the Infracos most effectively should they choose to do so.

Similarly, the OPPPA should bear in mind the need to see a consistent approach from the Infracos in their approaches to Asset Management to ensure that performance over time can be assessed and compared.



5. Glossary

AM Asset Management

AMP Asset Management Plan

AAMP Annual Asset Management Plan

AMS Asset Management Strategy

AASHTO American Association of State Highway and Transportation Officials

Austroads Association of Australian and New Zealand Road Transport and Traffic Authorities

CMM Capability Maturity Model

GAMO Good Asset Management Organisation

Infraco Infrastructure Company

IAM Institute of Asset Management

LRR Lloyd’s Register Rail

LUL London Underground Limited

Main Roads WA State Road Authority, Western Australia

Metronet BCV Infraco (Bakerloo, Central and Victoria lines)

Metronet SSL Infraco (Sub-surface lines)

OPPPA Office of the PPP Arbiter

Parties Parties to the PPP contracts (LUL and the Infracos)

PDCA Plan, Do, Check, Act

PAS 55 Publicly Available Specification 55

PPP Public Private Partnership

QMMG Quality Management Maturity Grid

Tube Lines Infraco (Jubilee, Northern and Piccadilly lines)



6. References

American Association of State Highway and Transportation Officials (2001), Transportation Asset Management Guide.

AMT Sybex (2004), Asset Management Business Model.

AMT Sybex (2004), Tube Lines Asset Management Transformation Programme: Developing Asset Management Regimes for Asset Specific Groups.

ANZECC, Benchmarking best practice in Asset Management.

Asset Management Consulting Limited (2005), Asset Management Excellence Model.

Austroads (2002), Integrated Asset Management Guidelines for Road Networks.

Austroads (2002), Road Network Asset Management: International Benchmarking Study.

Austroads (2003), The development of performance contracts & specifications.

BP Amoco (1999), Getting HSE right: a guide for BP Amoco Managers.

British Standards Institution (2004), Publicly Available Specification 55 Parts 1 & 2.

Byrne R. (2001), Best Practice Management Networked Infrastructure Assets, GHD.

Byrne R., Edwards R. and Wilson J., Asset Management Benchmarking to deliver sustainable improvement.

Cambridge Economic Policy Associates (2003), Approach to Benchmarking Infraco Efficiency & Performance. Report to the London Underground PPP Arbiter.

Crosby, P. (1996), Quality is Still Free. McGraw Hill.

ERA Technology (2001), Engineering Asset Management (Conference Proceedings).

EUREKA (1999), Maine Macro Maintenance Strategy. Maintenance & Asset Management Vol. 13 No. 2 1998.

Government of South Australia (1998), Energy Management Guidelines.

Government of South Australia (1999), Strategic Asset Management Framework.

Greenland, G.D. (2004), Achieving Value from London Underground’s Public Private Partnership. MSc Dissertation.

Imperial College (2003), Lloyd’s Register Asset Management Study - Full Report.



Imperial College (2004), Lloyd’s Register Asset Management Study - Summary Report.

Maintenance Technology, 21st Century Maintenance Organisation.

Maintenance Technology, Asset Management Approach Transforms Maintenance.

Maintenance Technology, The Future of Asset Management.

Metronet Rail BCV Limited (2003), Asset Management Strategy.

Metronet Rail SSL Limited (2003), Asset Management Strategy.

Mihai F., Binning N. and Dowling L., A Framework for Assessing Asset Management Performance in Australia. Main Roads, Western Australia.

MRO Software (2003), Strategic Asset Management in the Oil and Gas Industry.

MRO Software (2003), Strategic Asset Management in the Utility Industry.

MRO Software (2004), Strategic Asset Management in the Transportation Industry.

NSW Government (2003), Total Asset Management Manual.

NZ National Asset Management Steering Group (2000), International Infrastructure Management Manual - Australia/New Zealand Edition.

Office of Asset Management Federal Highway Administration (2004), FHWA Asset Management Position Paper.

Office of Gas and Electricity Markets (2002), Asset Risk Management Survey Guide.

Office of Gas and Electricity Markets (2002), Survey Questionnaire.

Office of Gas and Electricity Markets (2002), Survey Results.

Organisation for Economic Co-operation and Development (2000), Asset Management for the Road Sector.

Pilling, M. and Wilkinson, L., Reliability based maintenance and condition monitoring. Asset Management Consulting Limited and Network Rail.

PPP Arbiter (2004), Good Industry Practice, Asset Management Workshop.

PPP Contracts.

Queensland Water, Guidelines for Implementing Total Management Planning.

Software Engineering Institute (1993), Capability Maturity Model for Software.

Software Engineering Institute (2000), Capability Maturity Model Integration.

Transit New Zealand (2000), Guidelines for Implementing Total Management Planning.

Tube Lines Limited (2004), Asset Management Strategy.

US Department of Transportation (1999), Asset Management Primer.



Wallsgrove, R., The Real Cost of Asset Information: How better costs less. Institute of Asset Management.

Woodhouse, J. (2001), Asset Management Decision Making. The Woodhouse Partnership.

Woodhouse, J. (2001), Mixing the best modern methods. The Woodhouse Partnership.

Woodhouse, J. (2003), Asset Management: Concept and Practices.



APPENDIX A EVALUATION TABLES



EVALUATION TABLE FOR PROCESS ELEMENTS Level Process Element Evaluation Criteria

Level 5

The Element is fully addressed, with support processes implemented appropriately, effectively and consistently. The Element contributes to an integrated Asset Management system that has delivered business performance at the highest level over a number of years. Recognised as a world class performer.

Level 4

The Key Areas are fully consistent and sustainable and support the delivery of a coherent and effective Asset Management system. There is significant evidence of Asset Management best practice implementation. The whole life approach to Asset Management is embedded throughout the organisation. Successful continuous improvement initiatives have been implemented. To progress towards world class Asset Management performance, action should be taken to optimise fully the Asset Management system.

Level 3

The Key Areas are generally consistent and sustainable, and the Element is delivered appropriately. Although the processes are generally robust, there is some evidence of weaknesses that may affect the effectiveness and performance of the Asset Management system. The Element integrates the whole life approach to Asset Management. There is evidence of Asset Management best practice in some areas of the organisation. Continuous improvement initiatives are in the process of being identified and implemented. Action should be taken to improve the effectiveness and performance of the Asset Management system and to widen the adoption of good industry practice.

Level 2

All of the Key Areas are being considered, however there is only partial evidence of their consistency and sustainability. There is some evidence of appropriate and coherent management of the Key Areas and their supporting processes, however it is insufficient and therefore the Element is not fully delivered. There is some awareness of Asset Management best practice and identification of initiatives to deliver a whole life approach to Asset Management. There may be a risk to achieving business objectives from not delivering the Element. Action should be taken to achieve the Key Areas and hence deliver the Element.

Level 1

The Element is not being managed appropriately. Most of the Key Areas are being considered, however there is no clear evidence of their consistency or sustainability. There is no clear evidence of appropriate and coherent management of the Key Areas or their supporting processes. There may be an over-reliance on certain individuals to implement and manage the necessary processes. There is evidence of poor understanding of the Element. There is a risk to achieving business objectives from not delivering the Element. Action should be taken to achieve the Key Areas and hence deliver the Element.

Level 0

The Element is being managed poorly. Not all of the Key Areas are being considered. Processes either do not exist, or there is insufficient evidence to demonstrate whether the Key Areas are being achieved. There is a considerable risk to achieving the business objectives from not delivering the Element. Action should be taken to achieve the Key Areas and hence deliver the Element.



EVALUATION TABLE FOR ENABLING ELEMENTS Level Enabling Element Evaluation Criteria

Level 5

The Element is fully addressed, and integrated appropriately, effectively and consistently into the Asset Management processes. The Element contributes to an integrated Asset Management system that has delivered business performance at the highest level over a number of years. Recognised as a world class performer.

Level 4

All of the Key Areas are appropriately developed and balanced and support the delivery of a coherent and effective Asset Management system. The Element is integrated into the Asset Management processes. There is major evidence of good industry practice implementation. Action may be taken to optimise fully the Asset Management system and each of the Elements, progressing towards world class Asset Management performance.

Level 3

All of the Key Areas are identified in the Asset Management system and there is a clear understanding of the impact of the Element on the effectiveness of the Asset Management processes and the performance of the Asset Management system. There is commitment to the development of the Key Areas. The Element is partially integrated into the Asset Management processes. There is evidence of good industry practice in some areas of the organisation. Action should be taken to improve the performance of the Asset Management system, and to widen the adoption of good industry practice.

Level 2

All of the Key Areas are being considered and there is recognition of the impact of the Element on the effectiveness of the Asset Management processes and the performance of the Asset Management system. There is some evidence of commitment to the development of the Key Areas. There is some awareness of good industry practice and identification of initiatives to integrate the Element into the Asset Management processes. There may be a risk to achieving business objectives from not developing the Element. Action should be taken to improve the integration of the Element into the Asset Management processes

Level 1

The Element is not adequately developed. There is awareness of all the Key Areas, but there is little recognition of the impact of the Element on the effectiveness of the Asset Management processes and the performance of the Asset Management system. There is no clear evidence of commitment to the development of the Key Areas. There is a risk to achieving business objectives if the Element is not developed further. Action should be taken to achieve the Key Areas and develop the Element.

Level 0

The Element is poorly developed. Not all of the Key Areas are being considered. The Element is not considered in relation to the Asset Management system. There is a considerable risk to achieving the business objectives from not developing the Element. Action should be taken to achieve the Key Areas and develop the Element.



APPENDIX B SUMMARY TABLE



SUMMARY TABLE

Element Key Areas Main Considerations

Stakeholder needs and external requirements

• All stakeholder needs and external influences and requirements should be captured, considered and reflected appropriately, including the requirements of the PPP contract. External

Influences Consistency with Asset Management Policy and strategy

• Business objectives, the Asset Management policy and strategy should be consistent with the external requirements, which should be reflected in the Asset Management Plans.

Asset Management Policy and Strategy

• A clear and realistic Asset Management Policy and Strategy should be developed and be authorised by senior management.

Asset Management Plan

• The Asset Management plans should be aligned and should be consistent with the business objectives and asset management objectives.

Resource Planning • The human, material and financial resources should be appropriately managed

recognising resource constraints in order to achieve business objectives in a cost-effective manner.

Asset Management objectives and targets

• A number of asset performance objectives and targets for each of the assets/asset groups should be set. Their achievement should be measurable.

Planning

Alignment with external requirements

• Business objectives should take account of external and stakeholder requirements. Asset objectives and targets should be aligned with business objectives.




Delivery Management

• Appropriate processes and procedures should be developed and implemented to deliver the Asset Management activities in an effective manner throughout the lifecycle of the assets, from the identification of the need for an asset to final disposal.

Resource Management

• Resources should be appropriately managed and optimised to deliver Asset Management effectively as described Asset Management Strategy and Asset Management Plans, within organisational constraints (e.g. budget, timescales, resources, finance etc).

Delivery

Supply Chain Management

• Outsourced activities and any external parties on whom the Infracos are dependent for achieving objectives should be managed, ensuring control over such arrangements. (e.g. contract management, commercial arrangements, continuity of supply).

Performance measuring and monitoring

• The performance of the Assets and the Asset Management processes need to be periodically measured and monitored. Outputs are measured by using indicators set out in the Asset Management plan, to evaluate achievement of objectives and targets.

Audit • The appropriate implementation and operation of the Asset Management process,

procedures, guidelines and tools are periodically audited on a risk basis to ensure they remain effective.

Corrective Action • Corrective actions should be implemented for all identified gaps and system weaknesses and fed into the appropriate activities.

Review

Management Review • The review of the overall Asset Management system and its outputs should be carried out at the corporate management level.




Data and information management policy

• The organisation should have a policy that outlines the organisation’s overall approach to managing its data and information in supporting the achievement of the organisational objectives, and ensures that it is appropriate for meeting all internal and external requirements.

Integrated information management system

• The organisation should have an integrated information management system able to manage the data and information required to support Asset Management activities and decision making processes.

Data, information and knowledge

• Relevant and easily accessible data, information, knowledge and tools should be readily available to those who need it.

Integrity and consistency of data and information

• The integrity and consistency of the overall system, the data and the information it contains, and the competency of its users needs to be ensured.

Information Management

Audit trail • The information management system should provide an audit trail of Asset Management activity.

Risk management policy

• The organisation should have a risk management policy to cover risks including safety, technical, environmental and commercial risks.

Risk based decision making

• Risk evaluation is central to the Asset Management process and should be integrated to decision making processes.

Structured risk management system

• The risk management system should provide a structured approach to the identification, assessment and control (prevention and mitigation) of risks and the impacts these have on the overall operation and performance of the assets.

Business continuity management

• The organisation needs to have an appropriate framework and processes in place and rehearsed to manage its resilience to business and operational disruption, interruption or loss.

Risk Management

Emergency and recovery management

• The organisation should have appropriate procedures in place and rehearsed to minimise the down time from an emergency or disruption to business or operational continuity.




Senior management support and championing

• The senior management should have the responsibility for and fully support and champion the Asset Management regime.

Promotion of desired culture

• The desired Asset Management culture should be promoted and a commonality of purpose should be evident across the organisation.

Active Leadership

Continuity of Leadership

• The Asset Management leadership should be continuous and its commitment sustainable over the short, medium and long term.

Culture

• The company should understand and be aware of the need for and the importance of a strong and healthy corporate culture of continuous improvement in line with business objectives, and dedicates the required resources and effort to spread this understanding across the organisation.

Benchmarking • The company should perform external and internal Asset Management

benchmarking evaluations looking at good Asset Management practice to identify improvement opportunities.

Continuous Improvement Culture

Change management • The company should have an improvement or change management plan to continuously improve and adapt to the needs of the business.

Organisation • The organisation should establish and maintain an organisational structure

consistent with the achievement of its Asset Management policy, strategy, objectives, targets and plans.

Responsibility, authority and accountability Responsibilities,

authority and accountability

• Responsibilities and accountabilities should be clearly and unambiguously defined, documented, communicated to and agreed with post holders.




Competency and skills

• All current and future competency and skills required to ensure the sustainability of the Asset Management regime and achieve the Asset Management and business objectives should be captured and understood.

Systems, training and resources

• All staff should be provided with appropriate tools, training and resources to perform their duties.

Knowledge focused organisation

• The organisation should develop and maintain in an effective manner both corporate knowledge and the knowledge, skills and competence of individuals.

Competency

Senior management familiarity with Asset Management

• The senior management team should be familiar with broad Asset Management concepts, their applicability, benefits and impact on the achievement of business objectives.

Asset Management communication

• All key Asset Management issues, decisions and relevant documentation, including Asset Management strategy, plans, processes, milestones and objectives, should be communicated internally (and externally as appropriate) in order to maximise the effectiveness of the Asset Management regime and overall business outcomes.

Effective communications

• Communications should be effective regardless of organisational structure and should be clear, accurate and pertinent and be carried out in a timely manner.

Communications

Support systems • The organisation should implement appropriate systems to facilitate internal and external communications.

Explicit and well documented Asset Management model

• There should be an explicit Asset Management model outlining the Asset Management regime. Explicit Model

External references • The Asset Management model should reference external standards and the PPP contract, as well as other legal and regulatory requirements.

APPENDIX C ELEMENT GUIDELINES



External Influences Process Element

Definition An organisation should take into account all of the external influences and reflect them as appropriate in the business objectives. There should be a consistent link between stakeholders needs and other external requirements through to the business objectives and the Asset Management policy.

1. Key Considerations and Guidance

Stakeholder needs and external requirements

• All stakeholder needs and external influences and requirements should be captured, considered and reflected appropriately, including the requirements of the PPP contract. These include:

- All Asset Management requirements within the contract need to be identified and addressed, and should drive the Asset Management activities. The Business and Asset Management objectives, and therefore the entire Asset Management regime, need to be in line with the contractual requirements

- Customers, legal and regulatory requirements, shareholders, investors, regulator, government, supply chain, contractors, community groups, passenger lobby groups, media etc.

- Requirements of other relevant stakeholders including health, safety, sustainability and environmental performance requirements

- Reputation and image - Corporate values, ethics and issues related to Corporate Social

Responsibility (CSR) should be made explicit and communicated to customers and stakeholders

Consistency with Asset Management System

• Business objectives, the Asset Management policy and strategy should be consistent with the external requirements, which should be reflected in the Asset Management Plans.

2. Reference to key frameworks

Stakeholder needs and external influences

Consistency with Asset Management System

PAS 55-2 4.3.3 AASHTO 5.5.4 Austroads 4.1.1;4.1.3 IIMM 2.5.5; 3.2.4



Planning Process Element

Definition Planning should ensure an integrated and consistent approach to asset management from the business objectives through to the performance of a specific asset. There is a need to establish an asset management policy and asset management strategy that is aligned and consistent with the business objectives. There should also be appropriate objectives and targets for specific asset groups and assets in line with the overall strategy, which are all linked back to the overall business objectives. Planning should be appropriate, consistent and sustainable.


Asset Management Policy and Strategy

• A clear and realistic Asset Management Policy and Strategy should be developed and be authorised by senior management. The Asset Management Policy and Strategy should make clear reference to:

- The alignment of the Asset Management system with stakeholder and external requirements

- The cost-effective (value) and whole life-cycle approach to Asset Management

- The scope of Asset Management

Asset Management Plan

• The Asset Management plans should be aligned and should be consistent with the business objectives and asset management objectives. The Asset Management Plans should:

- Ensure that the annual plan supports the delivery of long term corporate objectives

- Be consistent and aligned with the business and asset management objectives

- Integrate the outcome of the risk management process - Draw on the available asset and non-asset related information - Reflect information management system (IMS) and sets requirements

for the IMS - Address the gaps identified during the review process - Ensure integrated management between asset groups and a systems

approach - Evaluate the impact of new technology and innovative solutions on

the overall performance of the assets/asset groups. The evaluation of technology should focus on the long term whole-life impact on cost-efficiency and overall resulting value generated for the company

Resource Planning

• The human, material and financial resources should be appropriately managed recognising resource constraints in order to achieve business objectives in a cost-effective manner.



Where limited resources exist, the prioritisation of works and activities should be carried out based on the following criteria:

- Whole asset life-cycle and cost-benefit analyses (non financial cost and benefits should also be considered)

- Current and forecast financial resources - Economic trends - Community requirements - Risk impact of performing and not-performing works - Joined up planning and management of day to day operations and

capital projects

Asset Management objectives and targets

• A number of asset performance objectives and targets for each of the assets/asset groups should be set. Their achievement should be measurable.

These objectives should:

- be Specific, Measurable, Achievable, Relevant and Time based (SMART)

- be consistent with and be appropriate to the achievement the Asset Management and business objectives

- clearly set and implement key, relevant and measurable outputs for each of the objectives

- address a basket a measures encompassing technical, cost effectiveness, value and soft issues such as cultural indicators

- have measurable outputs that are defined at an appropriate level of granularity


• Business objectives should take account of external and stakeholder requirements. Asset objectives and targets should be aligned with business objectives.

- Specific processes to periodically identify requirements should be implemented

- Tools and procedures to continuously identifying legal, regulatory and standard changes should be established and their effectiveness periodically assessed

2. Reference to key framework guidelines

Policy and Strategy Plan Resource

Planning Objectives

and Targets


PAS 55-2 4.2 4.3.6 4.3.4;4.3.5 AASHTO 4

5 6 5.4;6.2.1

Austroads 4.2.3;4.3;4.4 App C:Stage 2, Step 11

4.3; App C :Stage ,

Step 4

IIMM 2.6 1.2.1; 2.5.4; 2.6;3.3;3.8

3.10 2.2.3;3.2.3;3.3 3.2.2



Delivery Process Element

Definition The management of the delivery of the appropriately performing assets is in line with the agreed Asset Management plan. The delivery should be managed across the whole asset lifecycle. Necessary resource, including labour, technology and capital, both internal and external, should be properly managed, as should all interfaces and in particular the supply chain.


Delivery Management

• Appropriate processes and procedures should be developed and implemented to deliver the Asset Management activities in an effective manner throughout the lifecycle of the assets, from the identification of the need for an asset to final disposal. The delivery management should:

- Ensure quality of operations and maintenance - Manage and measure programme delivery in terms of schedule, cost

and scope, to ensure success - Track delivery against programme and operations plans to allow

adjustments to be effected as necessary - Ensure that policy makers and key stakeholders are kept up to date

with performance and programme delivery - Implement the output of risk management and control measures

identified - Draw on the available asset and non-asset related information

Resource Management

• Resources should be appropriately managed and optimised to deliver Asset Management effectively as described Asset Management Strategy and Asset Management Plans, within organisational constraints (e.g. budget, timescales, resources, finance etc).

Supply Chain Management

• Outsourced activities and any external parties on whom the Infracos are dependent for achieving objectives should be managed, ensuring control over such arrangements (e.g. contract management, commercial arrangements, continuity of supply). The Supply Chain management should ensure that:

- Procurement policies are aligned and consistent with Asset Management Policies

- HR policies are aligned and consistent with Asset Management policies

- Internal and external contractual and legal obligations are implemented



- Commercial arrangements are managed - A risk based management of suppliers is performed to ensure

procurement specifications are in line with asset needs and to ensure continuity of adequate supplies

- The service provision is not disrupted 2. Reference to key framework guidelines

Delivery Management Resource Management Supply Chain Management

PAS 55-2 4.4.6 4.1 AASHTO 7;9 7.2.5 Austroads App C:Stage 4, Step 2 IIMM 2.8 2.8



Review Process Element

Definition Review includes performance measurement and monitoring, audit and management reviews (including senior management review). It is essential that corrective actions are carried out where necessary. Note: continuous improvement is not included in Review but is captured by a separate framework element.

1. Key Considerations and Guidance The review activities should be carried out in the following areas: • Stakeholder and external requirements • Business and Asset Management objectives • Asset Management strategy and plans • Asset performance against targets • Management level • Asset Management structure and competencies • Outcome of risk management system • Data, information and information management systems • Commercial tactics and contractual issues • Performance, quality and continuity of the supply chain


• The performance of the Assets and the Asset Management processes need to be periodically measured and monitored. Outputs are measured by using indicators set out in the Asset Management plan, to evaluate achievement of objectives and targets.

The indicators should measure:

- Quality of services - Efficiency and cost-effectiveness of Asset Management activities - Achievement of asset performance and asset condition as stated in

contractual requirements between the Infraco and LUL - Sustainability of the Assets, Asset Management system and activities - Trends of performance over time and between comparable functions

Audit

• The appropriate implementation and operation of the Asset Management process, procedures, guidelines and tools are periodically audited on a risk basis to ensure they remain effective.

The audit system should ensure that:

- The audit scheme is integrated within the company’s Quality Assurance System audit programme

- The audit is done at three levels: within the Asset Management team, internal peer review and external audit

- The audit scheme should be prioritised based on risks



Corrective Action

• Corrective actions should be implemented for all identified gaps and system weaknesses and fed into the appropriate activities. The corrective actions should address:

- Re-optimisation of Asset Management approach based on measurements/analysis

- Effective management of resulting change. Ensure that gaps are addressed in the planning stage and corrective actions applied to the respective elements and areas of the framework

Management Review

• The review of the overall Asset Management system and its outputs should be carried out at the corporate management level. The review should:

- Ensure its adequacy and suitability to achieve the business objectives - Ensure integration and alignment with other systems within the

organisation - Identify gaps that need to be addressed at corporate level - Review the effectiveness of interdependent processes - Consider if resource levels are sufficient and/or adequate to implement

and deliver Asset Management activities

Links to other elements

• Effective management of resulting change. Ensure that gaps are addressed in the planning stage and corrective actions applied to the respective elements and areas of the framework


Performance

Measuring and Monitoring

Audit Corrective

Action Management Review

PAS 55-2 4.5.1 4.5.2

4.5.4 4.5.2 4.6

AASHTO 7.3.1;8.5.2;8.5.3 7.4.2 Austroads App C:Stage 2,

Step 14 App C:Stage 2,

Step 13

IIMM 3.4 2.9



Information Management Process Element

Definition Information management is the specification, collection and analysis of all data, information and knowledge necessary for the achievement of the organisational objectives. It includes the systems used to collect, and store and analyse the data and information



• The organisation should have a policy that outlines the organisation’s overall approach to managing its data and information in supporting the achievement of the organisational objectives, and ensures that it is appropriate for meeting all internal and external requirements.


• The organisation should have an integrated information management system able to manage the data and information required to support Asset Management activities and decision making processes. The information management system should:

- collect, store and facilitate appropriate, accurate, accessible, reliable and up to date data and information to support all Asset Management activities, including planning, delivery, review and risk management activities

- facilitate the decision making process at the different levels of the organisation

- be of appropriate technology and complexity for the company and its business activity


• Relevant and easily accessible data, information, knowledge and tools should be readily available to those who need it. The information should include:

- Key operational and performance data (e.g. level of service, utilisation and capacity, asset value etc.)

- Asset information (Asset Register), including Asset performance and condition information

- Both current and historical data - Tools to support effectively the Asset Management activities e.g.

Gap analysis Project evaluation Performance management Prioritisation and optimisation Programme delivery tracking Reporting and documenting




• The integrity and consistency of the overall system, the data and the information it contains, and the competency of its users needs to be ensured. It needs to ensure that the asset information is consistent with the asset condition on the ground.

Audit trail

• The information management system should provide an audit trail of Asset Management activity (e.g. for use in the event of an incident or accident).

- As such the life of the data held should be specified and managed - Documents should be adequately archived and accessed by authorised

individuals 2. Reference to key framework guidelines

Data and information management

policy

Integrated information management

system

Data, information

and knowledge

Integrity and consistency of

data and information

Audit trail

PAS 55-2 4.3.1 4.3.1; 4.4.5;4.4.4

4.3.1

AASHTO 8.3;8.4;8.5 8.2 8.2 8.5.1 Austroads App C:Stage 2,

Step 7

IIMM 4.1 4.3;4.4;4.5



Risk Management Process Element

Definition Risk Management is the adoption of a risk based approach to business and safety management throughout the organisation and across the Asset Management cycle. A risk based approach should be taken to all decision making. Risk management includes management of all risk and safety related aspects, including emergency and recovery management as well as business continuity management.


Risk Management Policy

• The organisation should have a risk management policy to cover safety, technical, environmental and commercial risks. The policy should:

- be issued by the CEO and approved by the Board - be in line with the corporate strategy - make clear management’s commitment to the risk management - point out that all staff with management responsibility are expected to

manage corporate risks


• Risk evaluation is central to the Asset Management process and should be integrated to decision making processes.


• The risk management system should provide a structured approach to the identification, assessment and control (prevention and mitigation) of risks and the impacts these have on the overall operation and performance of the assets. This should include:

- Understanding the probability of an event and its consequences - Evaluation of financial, technical, obsolescence, operational, public

opinion, media, stakeholder influence, safety and environmental consequences

- Physical failure risks such as functional failure, incidental damage , malicious damage or terrorist action

- Risks out of the organisation’s control such as natural disasters or failures in external services. For those risks difficult to prevent, contingency plans with effective mitigation measures need to be established

- Risks arising from any of the asset cycle activities, from design to asset disposal

- Risks associated with any change (e.g. organisation, operations, duty cycle, contract, process, legislation, technology etc)

- Risk associated with availability of current and future resources - The outcome of the risk assessment and the effects of the controls

identified should be considered and where appropriate provide input into: Asset Management strategy, plan, objectives and targets



All Asset Management related decision making processes at both strategic as well as operational levels

Planning of adequate resource levels and identification of skill and training requirements

Development of operational and business controls Organisation’s overall risk management framework

- The risks identified should be used to focus effort in those areas that will have greatest impact on the achievement of organisational objectives (e.g. focussing of audit programme)

- Control measures identified should be defined and applied, and regularly tested as appropriate and modified as necessary

Business Continuity Management (BCM)

• The organisation needs to have an appropriate framework and processes in place and rehearsed to manage its resilience to business and operational disruption, interruption or loss. It should:

- Identify and where feasible quantify, those risks that could have a negative impact on the company’s business and operational continuity

- Establish robust processes to identify and manage business critical activities to ensure the sustainable delivery of the business in the long term.


• The organisation should have appropriate procedures in place and rehearsed to minimise the down time from an emergency or disruption to business or operational continuity.

The organisations should establish and maintain appropriate contingency plans and procedures to identify the potential for, and responses to, incidents and emergency situations, and establish mitigating controls to the likely consequences that can be associated with them. The emergency and recovery plans should:

- include information on the provision and maintenance of any identified equipment, facilities or services that may be required during incidents or emergency situations (e.g. emergency pumps, generators, temporary shelters, access to back-up information)

- be rehearsed in order to test their effectiveness. The organisation shall retain records of rehearsals and be able to demonstrate that appropriate review and improvement has been carried out

- be periodically reviewed and tested to ensure the effectiveness of its emergency preparedness and response plans and procedures, in particular after the occurrence of incidents or emergency situations




Risk

Management Policy


Structured risk

management system

Emergency and recovery

Business continuity

PAS 55-2 4.3.2 4.4.7 IIMM 3.5;3.6 3.6.8



Active Leadership Enabling Element

Definition There should be a senior manager with responsibility and accountability for and commitment to Asset Management throughout the organisation. The senior manager shall have the appropriate authority to fulfil their responsibilities. There should be appropriate leadership and commitment to Asset Management activities at all levels and areas of the organisation.


Senior management support and championing

• The senior management should have the responsibility for and fully support and champion the Asset Management regime.

- A member of the senior management (at Board level) should have ownership and responsibility for Asset Management, committing to and championing Asset Management inside the organisation and representing it externally.


• The desired Asset Management culture should be promoted and a commonality of purpose should be evident across the organisation.

- The owner of the Asset Management regime should ensure that there is clear visibility of Asset Management commitment and that commitment should be clearly set out and publicised across the organisation


• The Asset Management leadership should be continuous and its commitment sustainable over the short, medium and long term. This should include succession plans, as well as deputies and wide board level support.


Senior management support



PAS 55-2 4.4.1 AASHTO 4.3.1 IIMM 2.2.1



Continuous Improvement Culture Enabling Element

Definition There should be a culture of continuous improvement across the organisation. This should exist within all functions and hierarchies and be led by the senior management team. Staff should be actively and enthusiastically involved in improving the day to day performance of the assets and asset management systems to better achieve corporate objectives. Improvement should be proactive and should be sought at an individual, team and corporate level.


Culture

• The company should understand and be aware of the need for and the importance of a strong and healthy corporate culture of continuous improvement in line with business objectives, and dedicates the required resources and effort to spread this understanding across the organisation.

Benchmarking

• The company should perform external and internal Asset Management benchmarking evaluations looking at good Asset Management practice to identify improvement opportunities. Benchmarking should:

- be carried out to identify potential areas for improvement and to deliver guidance on how to achieve those improvements

- be aimed at achievable results and be focused on implementation - have support from the senior management team - be initiated with appropriate partners - consider process, best practice and strategic benchmarking - be appropriate and be related to the business objectives.

Change Management

• The company should have an improvement or change management plan to continuously improve and adapt to the needs of the business. The scope of the improvements should consider aspects of the enterprise outside of the Asset Management regime. The change management plan should promote the following activities:

- Continuous learning from mistakes, accidents and near misses - Continuous and effective change management, identifying where

change is required and implementing it - Continuous identification of the right areas for improvement. Cost of

improvement should be balanced against benefits. - Finding and evaluating new techniques and technology to consider for

appropriateness - Performing regular critique to of all activities to ensure they are in line

with the business objectives - Assessing the risks of the change itself before and after it is

implemented




Culture Benchmarking Change Management

AASHTO 9.3 IIMM 2.9.5 2.4



Responsibilities, Authorities and Accountabilities Enabling Element

Definition The need for clearly defined responsibilities, authorities and accountabilities throughout the organisation. Essential at interfaces, in particular supply chain and contract management All teams and individuals need to understand their roles in achieving the overall business objectives.


Organisation

• The organisation should establish and maintain an organisational structure consistent with the achievement of its Asset Management policy, strategy, objectives, targets and plans. An Asset Management team with the adequate structure should be established, which should:

- encourage corporate buy-in and responsibility for Asset Management outputs

- report to a member of the senior management team - have clear and well documented structure, roles, responsibilities and

authorities

Responsibilities, authority and accountability

• Responsibilities and accountabilities should be clearly and unambiguously defined, documented, communicated to and agreed with post holders.

- A member of the top management, irrespective of other responsibilities, should be responsible for the overall design, maintenance, documentation and improvement of the organisation’s Asset Management system

- Member(s) of management should have the responsibility to ensure that the assets or group of assets deliver the Asset Management strategy, objectives and targets (in accordance with the Asset Management policy and plan)

- Authority levels should be well identified at all levels and should be consistent with the levels of responsibility to ensure achievement of Asset Management objectives

- The responsibilities and accountabilities should evolve to meet the changing needs of the organisation

- The responsibilities should include: Ensuring consistency between Asset Management policy, strategy,

objectives and targets and their alignment with stakeholder and external requirements

Integration and application of a whole life approach to Asset Management within the Asset Management regime and overall corporate culture

Communicating to the organisation the importance of meeting its Asset Management requirements in order to achieve its organisational business objectives



Ensuring risks are evaluated and the outcome considered in all decision making processes

Ensuring the viability of the Asset Management strategy, objectives, targets and plans

Delivery to required standards within the defined Asset Management system

Improvements to the Asset Management system 2. Reference to key framework guidelines

Organisation Responsibility, authority and

accountability PAS 55-2 4.4.1 4.4.1 AASHTO 4.3 Austroads App C:Stage 1, Step 1 IIMM 2.3



Competency Enabling Element

Definition The organisation should be competent to achieve its business objectives at an individual, team and corporate level. The organisation should have the appropriate people with the appropriate competencies in the appropriate positions. Competency includes knowledge, experience and training. Competency levels should be managed for the present and the future.



• All current and future competency and skills required to ensure the sustainability of the Asset Management regime and achieve the Asset Management and business objectives should be captured and understood. Based on these requirements, competency gaps and needs should be identified.


• All staff should be provided with appropriate tools, training and resources to perform their duties.

- Ongoing training for staff working directly in Asset Management or any key support activities such as information systems needs to be delivered.

- The training scope, level, amount and timing need to be adequate to the degree of sophistication of the organisation’s Asset Management planning processes and information systems

- A development plan to meet projected and current resource and skill requirements should be in place and should include process, procedures and tools to: Facilitate an audible competency review for individuals, teams and

organisation Ensure effective forward resource management and succession

planning


• The organisation should develop and maintain in an effective manner both corporate knowledge and the knowledge, skills and competence of individuals, with emphasis on:

- Learning, both formal and informal and a continuous learning culture should be promoted

- Effective knowledge development, both explicit and tacit - Effective management of knowledge transfer (i.e. documentation,

communication etc)



Management familiarity with Asset Management

• The senior management team should be familiar with broad Asset Management concepts, their applicability, benefits and impact on the achievement of business objectives.




Knowledge focused

organisation

Management familiarity with

AM PAS 55-2 4.4.2 4.4.2 Austroads App C:Stage 4,

Step 1

IIMM 2.3.4



Communications Enabling Element

Definition Effective and efficient transfer of information and knowledge related to all Asset Management activities to and from those who need it or are affected by it.


Asset Management communication

• All key Asset Management issues, decisions and relevant documentation, including Asset Management strategy, plans, processes, milestones and objectives, should be communicated internally (and externally as appropriate) in order to maximise the effectiveness of the Asset Management regime and overall business outcomes.


• Communications should be effective regardless of organisational structure and should be clear, accurate and pertinent and be carried out in a timely manner.

- Asset Management and related issues should be promoted using appropriate communications channels

- Internal communications: Vertical communication through the levels of the organisation Horizontal communication across teams and work groups Communication and relationship between functional interfaces

(e.g. finance) Internal consultation on Asset Management issues e.g. areas for

improvement, staff issues - External communications:

Communication with stakeholders Communication with all parties to the PPP External consultation on Asset Management issues e.g. customer

and stakeholder requirements, supply chain, contractors etc Public reporting and dissemination

Support systems

• The organisation should implement appropriate systems to facilitate internal and external communications.

- Internal : House journals Management briefings

- External: Press releases Passenger focus groups Media interviews Other




AM communication Effective communication Support systems PAS 55-2 4.4.3 4.4.3 AASHTO 9.3.3 Austroads App C:Stage 1, Step 2&4



Explicit Model Enabling Element

Definition An organisation should have an explicit, documented Asset Management model available to all of its employees.


Explicit and well documented

• There should be an explicit Asset Management model outlining the Asset Management regime. The Asset Management model should:

- include the following: Processes, procedures and guidelines Supporting processes Roles and responsibilities Interfaces with other company systems (e.g. quality, safety or

environmental management system) Clear ownership for the entire regime Proper configuration control.

- be available to all employees and stakeholders as appropriate - draw on and integrate with existing management systems as

appropriate

External references

• The Asset Management model should reference external standards and the PPP contract, as well as other legal and regulatory requirements.

- The Asset Management processes should be cross referenced to the chosen external framework and relevant standards.

- Processes to monitor, review and act upon external standards, law contractual and regulatory changes should be implemented

2. Reference to contractual requirements

Explicit and well documented AM model

External references

PAS 55-2 4.1; 4.4.4

Office of the PPP Arbiter

Asset Management Evaluation Framework Annexes

© Lloyd’s Register Rail Limited 2005 This document was prepared for the Office of the PPP Arbiter under the terms of a contract. The information herein is confidential and shall not be divulged to a third

party without the prior permission of Michael Woods, Technical Manager.

Lloyd’s Register Rail 4th Floor, Hamilton House

Mabledon Place London, WC1H 9BB

© Lloyd’s Register Rail 2005 Page ii Printed: 12/08/05 Issue - 01

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TABLE OF CONTENTS

Annex I. Development of the Asset Management Evaluation Framework Annex II. Review of Approaches to Asset Management Evaluation Annex III. Cross-reference of Elements to External Frameworks Annex IV. PPP Contract Requirement

ANNEX I DEVELOPMENT OF THE ASSET MANAGEMENT

EVALUATION FRAMEWORK

OPPPA Asset Management Evaluation Framework Annex I


1. Development of the Asset Management Evaluation Framework

1.1 Summary This annex describes the process of the Asset Management Evaluation Framework, and provides a detailed description of the different activities as well as their outcomes and findings.

The preliminary stage of the project included a literature review to identify any available evaluation frameworks, which were then analysed using a template of Asset Management elements based on a combination of PAS 55 and GAMO. This analysis was used to identify all the common components in each of the frameworks and also where there were gaps. These components were then grouped together into a smaller set of elements, which were then reviewed with the OPPPA, London Underground and the Infracos. The output of this stage was a coherent and cross-checked set of elements necessary for Asset Management. At this stage a framework was overlaid on the elements, showing the linkages between the elements and how they relate to one another. It was also decided in discussion with the OPPPA and the Parties to adopt an approach to the measurement of Asset Management performance based on maturity of development rather than a checklist approach.

Once the preliminary framework had been outlined, it was further developed ensuring that it was consistent with the PPP contractual requirements and developing a measurement methodology. A workshop was held to finalise the elements within the framework, and to develop the guidance for the elements and validate the approach to measurement.

The process followed in the development of the Asset Management Evaluation Framework is shown in Figure 1.



PPP ContractRequirementsPPP ContractRequirements

Review byParties

Review byParties

LUL InfracoOPPPA

PPPContract

UpdatedFrameworkUpdated

Framework

FinalFramework

FinalFramework

5.

6.

KeyFramework

MetricsDevelopment ofMeasurements

Development ofMeasurements

7.

LRR InternalWorkshop

LRR InternalWorkshop

9.Cross ReferenceWith FrameworksCross ReferenceWith Frameworks

8.Key

Frameworksfrom Stage 1

ChecklistChecklist

IdentifyKey Frameworks


Preliminary DraftFramework

Preliminary DraftFramework

CommonIssues

ImportantExceptions

LiteratureReview

PAS-55

GAMO

LUL

Infraco

OPPPA

MAPCoverage of each

evaluation methodology

PrioritiseApproaches


LRRail1. 2.

3.

4.

Figure 1. Evaluation Framework development process



The set of activities involved in the development of the framework include:

1. Literature Review. The literature review identified and reviewed existing Asset Management Evaluation Frameworks as well as good practice guidelines, from which a number of existing Evaluation Frameworks were selected for analysis.

2. Development of Preliminary Checklist. In parallel with the literature review, a preliminary checklist was developed based on PAS 55, GAMO and the experience of the Lloyd’s Register Group.

3. Appraisal. The key frameworks which had been identified during the literature review were evaluated against the preliminary checklist. The evaluation was based on four criteria (objectives, structure, elements and measurement approach).

4. Draft Framework. A draft framework was developed based on the outputs of the previous stages. The Asset Management Evaluation Framework was developed based on this draft framework, following review and consultation with the Parties.

5. Review by Parties. The draft framework was reviewed by London Underground and the Infracos to ensure that there was full consultation and evaluation, and that any gaps or misunderstandings were identified.

6. Cross-reference against PPP Contractual Requirements. The Asset Management Elements were reviewed against the PPP contracts to ensure that all references and requirements related to Asset Management were reflected in the framework.

7. Development of Measurement Approach. A method by which the Framework could be used to measure Asset Management performance was established, based on the analysis of measurement approaches.

8. Cross-reference against Asset Management Frameworks. The Framework was cross-referenced against the key frameworks to ensure that all the important discussion and guidance related to the elements was correct, appropriate and fully referenced.

9. Internal Development and Validation Workshop. An internal workshop was held with members of the Lloyd’s Register Rail Asset Management team to develop the guidance for each of the elements and to validate the measurement methodology.



1.2 Literature Review The first task of the project involved an analysis of all documentation that could be identified related to Asset Management frameworks, Asset Management Evaluation Frameworks as well as other Asset Management documentation that could bring valuable input to the project. The literature review process focused on the information available within the public domain, although a limited insight was also obtained into a few proprietary frameworks through several industry contacts as well as through the OPPPA, the Infracos and London Underground.



LiteratureReview 4040

40 documents including:- AM good practice docs.- AM evaluation frameworks- AM guidelines & manuals

1818

18 documents including:- AM evaluation frameworks- AM guidelines & manualsthat could add value to thefinal product

66

6 documents including:- AM good practice docs.- AM evaluation frameworks- AM guidelines & manuals

Stages Outcome

Figure 2. Literature Review Process

The literature review comprised three different activities, as shown in Figure 2 above:

1. Literature Review. The review drew on a number of sources. These included information from the OPPPA, London Underground and the Infracos, as well as including third party materials known to them. The review also looked at documentation from the Institute of Asset Management, the Lloyd’s Register Group, as well as wider literature and Internet-based reviews. The review resulted in the identification of around 40 documents in addition to the materials made available by OPPPA, London Underground and the Infracos. References to all these materials are provided at the back of the main report.

2. Prioritisation of Approaches. In a first filtering exercise, a preliminary review of documents representing Asset Management Evaluation Frameworks, Asset Management guidelines and manuals was undertaken. This review identified explicit Evaluation Frameworks as well as practitioner manuals containing more implicit evaluation methods. Only those approaches of most relevance to the final output of the study were shortlisted. In order to keep the review as wide as possible, neither industry sector nor geographic location was considered as particularly



relevant, although it was important to ensure that the documents identified had either a provenance or are widely recognised as good practice amongst Asset Management experts.

3. Identification of Key Frameworks. 18 documents were shortlisted, and from these the review identified those containing Evaluation Frameworks as of high relevance, those with clear guidelines and a holistic approach to Asset Management as medium, and those of value, but without an evaluation component as low. The high and medium approaches all showed a robust structure and a strategic approach to Asset Management. Detailed analysis was carried out for those frameworks identified as high relevance, to evaluate the elements of the checklist, and the result of this comparison exercise can be found in Annex II.

1.2.1 Literature review process main findings The literature review identified six frameworks that could provide valuable input to the study, and these are summarised in the table below.

Framework Industry Country of Origin

PAS 55 General UK GAMO General UK/Australia

Main Roads WA Highways Australia

Austroads Highways Australia GHD/AMCL General/Rail Australia/UK

AASHTO Highways USA

Table 1. Key Frameworks The following are the main findings of the literature review:

• Asset Management as a formal approach to the long term management of physical infrastructure assets exists mainly in Australia, New Zealand, the UK and the USA. In Australia it is most developed in the highway and municipal infrastructure sectors, and in the USA Asset Management is almost entirely confined to highway management. The UK has a broad base of interest in a number of sectors including utilities, oil & gas and rail.

• The strong Evaluation Frameworks which have been identified are mainly from the highway sector and most originate in Australia.

• Although a large number of documents were identified, most referred to the same relatively small number of common frameworks developed by a core of Asset Management experts.

• The frameworks identified are mainly for public sector practitioners (mostly local or regional authorities) to evaluate how they are progressing with Asset Management. These frameworks are usually designed for self assessment.

• Only one regulatory approach was reviewed (OFGEM) which is used to gain assurance of the quality of network utility companies’ Asset



Management approaches. It also strongly focused on the identification and encouragement of good practice.

• The GHD/AMCL and AMT Sybex approaches are both proprietary and as such it has not been possible to review them as comprehensively as the others. Hence the conclusions on these frameworks are limited.

• Although a range of approaches were identified, most of these were variations on a common theme. The emphasis of different frameworks depended on the specific history, purpose and sector. Most of the frameworks have been developed for a specific industry and therefore focus on those elements that are important for the management of particular asset types.

• However all the frameworks that have been reviewed cover certain central Asset Management issues. The differences between the frameworks tends to be in their emphasis on particular aspects or areas rather than major differences in the overall approach.

• The main themes running through most of the frameworks reviewed are that they follow the PDCA cycle; they consider the assets across their whole life cycle and that the frameworks follow a risk based approach to Asset Management.

• In terms of approach, the Evaluation Frameworks take one of two approaches: either that of a checklist or more of a competency approach similar to the Capability Maturity Model (CMM) used in the software domain.

• All the high priority frameworks reviewed have identified issues relating to both structure and the composite elements that should be considered in the development of this framework.

1.3 Development of Preliminary Checklist The preliminary checklist was developed based on PAS 55 and GAMO. These sources were identified by the OPPPA as the most appropriate starting point; one a recognised UK specification and the other an approach developed by Sarras for London Underground. These were supplemented by Lloyd’s Register Group’s experience:

• PAS 55: It is a Publicly Available Specification for the optimised management of physical infrastructure assets, developed in response to demand from industry for a standard for carrying out Asset Management (see section 1.3.1).

• GAMO: The GAMO Matrix is an approach developed by Ruth Wallsgrove of Sarras for London Underground and is currently included in the Infracos’ Asset Management Strategies. It evaluates an organisation against six main Asset Management principles (see section 1.3.2).

• Lloyd’s Register Group Asset Management experience: The experience of Lloyd’s Register Group professionals has been important to provide input, in particular from experience in other sectors, in verification, academia and as duty holders.



The preliminary checklist, contained the high level Asset Management elements extracted from PAS, GAMO and Lloyd’s Register Group experience. In total, the following 35 elements were identified as important in an Asset Management evaluation model:

• Stakeholders • External

Requirements • Business Objectives • Scope • Policy • Strategy • Objectives • Targets • Plan • Whole Life Costing • Timeframe • Resource

Management • Commercial Tactics • Supply Chain • Performance

Measuring and Monitoring

• Audit • Management Review • Corrective Action • Information and

Knowledge Management

• Safety Risk Management

• Emergency and Recovery

• Business Continuity Management

• Leadership • Continuous

Improvement • Good Industry

Practice • Culture • Organisation • Responsibilities,

Authority and Accountabilities

• Competency • Knowledge • Communication • Knowledge • Communication • Sustainability • Consistency • Appropriateness

For clarity and ease of understanding of the elements and the linkages between them, they were grouped into seven categories, covering external pressures, the Plan-Do-Check-Act (PDCA) cycle, information and risk management activities and softer people and environment related factors. These categories are listed below:

• External Influences • Planning • Delivery Management • Review • Internal Environment • Information System • Risk Management.



•Stakeholders•External Requirements

External InfluencesExternal Influences

•Business objectives•Scope•Policy•Strategy•Objectives•Targets•Plan

PlanningPlanning

•Whole Life Costing•Timeframe•Resources Management•Commercial Tactics•Supply Chain

Delivery ManagementDelivery Management

•Leadership•Continuous Improvement•Good Industry Practice•Culture•Organisation•Responsibilities, Authority and Accountabilities•Competency•Knowledge•Communication

Internal EnvironmentInternal Environment

•Performance Measuringand Monitoring•Audit•Management Review•Corrective Action

Review (Check and Act)Review (Check and Act)

•Information and knowledge•Management

Information SystemInformation System•Business Risk Management•Safety Risk Management•Emergency and Recovery•Business Continuity Management

Risk ManagementRisk Management

•Sustainability•Consistency•Appropriateness

Figure 3. Preliminary Checklist

The following sections provide further information on the main two approaches (PAS 55 and GAMO) that were used to cross check the various frameworks.

1.3.1 Publicly Available Specification (PAS 55) PAS 55 is a Publicly Available Specification that was developed by the British Standards Institution (BSI) and the Institute of Asset Management (IAM) in response to demand from industry for a standard for the implementation and execution of Asset Management. As a Publicly Available Specification it offers a non-proprietary means of assessing Asset Management competence within an organisation.

PAS 55 is applicable to any organisation in which physical assets are a key or critical factor in achieving business objectives and effective service delivery. It is currently being adopted by organisations in the transport and utilities sectors, both in the UK and abroad, to enable an assessment of their Asset Management against good industry practice.

PAS 55 comprises two parts: requirements and guidance. Although it does not prescribe mandatory approaches to the implementation of the requirements, PAS 55 does provide guidance for the implementation of an Asset Management system that follows cross industry good practice. The fact that



PAS 55 was developed following the ISO 14000 environmental standard, ensures that its guidance are in line with standard management systems in place in many organisations.

PAS 55 identifies 21 key elements for good Asset Management, to be delivered against an organisation’s overall objectives, and follows a five stage approach based on the standard ISO Plan-Do-Check-Act (PDCA) management cycle as shown in Figure 4.

AssetManagement

System

Implementation& operation

4.4

Checking &

corrective action 4.5

Checking &


Management

Review4.6Management

Review4.6

Policy& Strategy4.2

Policy& Strategy4.2

AM Info, riskassessment& planning4.3


Figure 4. PAS 55 Asset Management Cycle

1.3.2 GAMO GAMO was developed by Ruth Wallsgrove of Sarras on behalf of London Underground, during 2004, and was validated by Asset Management experts at a workshop in Australia in September 2004.

The matrix identifies six key principles of Asset Management that are present in all good practice Asset Management organizations. Five levels of competence or maturity have been identified for each of the six principles from ‘unaware’ up to ‘world class’.

The GAMO matrix facilitates self assessment, such that organisations can review their Asset Management against six key Asset Management principles allowing progress to be measured. The format allows a picture of current as well as mid and long term progress towards Asset Management best practice.

The GAMO approach has been incorporated by all of the Infracos into their current Asset Management Strategies. The GAMO matrix is shown in Figure 5 below.



A Ml e a d e r s h i pw i t h u r g e n c y

I n t e g r a t e dw h o l e l i f ed e c i s i o n s m a d eo n r i s k d e l i v e r y

G o o d a s s e ti n f om a n a g e m e n t

I n t e g r a t e d Q AA M p r o c e s s e s

S h a r e de x p l i c i t A Mm o d e l

C o n t i n u o u sA M c h a n g ep r o g r a m m e

W o r l d C l a s s

5

P o w e r f u lD i r e c t o rc o m m i t t i n gt h e i r c a r e e rt o A Mle a d in g t oc h a n g e o v e rt im e

F u l l w h o le l i f er i s k - b a s e dp r io r i t i s a t io na c r o s s a s s e t s /i n t e r v e n t io n s /t y p e s . D a y t od a y a n d lo n gt e r m

I n t e g r a t e dd e c is io ns u p p o r t , w i t hf a s t a n d e a s ya c c e s s t o t h ek e yin f o r m a t io n

E x c e l le n tr e la t i o n s h ipm a n a g e m e n ta c r o s sf u n c t io n a lin t e r f a c e sin c lu d in gs e r v i c ep a r t n e r s

“ E v e r y o n e ar i s k m a n a g e r ”

7 p lu s y e a r s– c o n t in u o u s

C o m p e t e n t

4

P o w e r f u lD i r e c t o rc h a m p io n in gA M

R is ke c o n o m ic s t oin t e g r a t ea g a in s t a s s e t sa n din t e r v e n t io n s /f u n c t io n s

I n t e g r a t in g &d is p la y in ga s s e tin f o r m a t io nu s e f u l l y

O p s /m a in t e n a n c e /p r o je c t s a l lw o r k in g w e l l t oc le a r g o o dp r a c t i c e r o le s ,c o n t in u o u s lyim p r o v in g

T a k in g A Mo u t t o t h e f i e lda n d s e r v i c ep a r t n e r s , a n dd e v e lo p in g i tf u r t h e r w i t ht h e m

3 - 5 y e a r sM a jo r s t e pc h a n g e se v id e n t

D e v e l o p i n g

3

B o a r d le v e la g r e e m e n tt h a t A M i sim p o r t a n t

P r io r i t i s a t io nc o n s is t e n tw i t h in a s s e tt y p e s / w i t h int y p e s o fin t e r v e n t io n

A d e q u a t ea s s e tp e r f o r m a n c ed a t a . D a t aa r c h i t e c t u r et h a tr e c o g n is e st h e c e n t r a l i t yo f i n f o a b o u ta s s e t s

E x p l i c i t a s s e tm a n a g e m e n tr o le s ,p r o c e s s e sw o r k in ge f f i c ie n t l yw i t h in s i l o s

K e y p e o p les h a r e t h em o d e ls ( a s s e tm a n a g e r s ,o n e o r m o r ed i r e c t o r s )

C o h e r e n tp r o g r a m m e< 3 y e a r s -S o m e q u ic kw in sd e l i v e r e d

A w a r e

2

M id d lem a n a g e m e nt p u s h in gA M

C o n c e p t o fp r io r i t i s a t io n inp la c e – p a t c h yim p le m e n t a t io n

R e c o g n is in gim p o r t a n c e o fa s s e tin v e n t o r y ,a s s e t d a t as e e n a s ac o r p o r a t ep r io r i t y

A M p r o c e s s e sb e in gd e v e lo p e d ,r e c o g n i t i o n o f‘5 b u b b lem o d e l ’f u n c t io n s in A Ma n d t h a to r g a n is a t io nh a s t o c h a n g et o m e e t t h e s e

H ig h le v e lv i s io n b e in gd e v e lo p e d b ys o m e in t h eo r g a n is a t io n

P a t c h yin i t i a t i v e s

U n a w a r e

1N ole a d e r s h ip

N o a t t e m p t t os y s t e m a t i c a l l yp r io r i t i s ein t e r v e n t io n s

I n a d e q u a t ea s s e tin v e n t o r y a n dn o f o c u s o na s s e t s ino t h e rc o r p o r a t es y s t e m s

N o f o c u s o nA M p r o c e s s e s

N o t o n t h er a d a r N o in i t ia t i v e s

Figure 5. GAMO Matrix

1.4 Appraisal The appraisal stage consisted of the evaluation of the key frameworks identified during the literature review process against five different criteria. These were:

• Objectives: Why was the framework developed? What was it intended to provide? Within which industry was it developed?

• Dimensions: What are the key dimensions identified by the framework?

• Structure: How does the framework link together the different Asset Management Dimensions and Elements?

• Elements: What are the main Asset Management Elements within the framework?

• Measurement: What measurement methodology and metrics does the framework use? This includes its characteristics as well as its applicability and adequacy for the output required by the OPPPA.



This review was undertaken to give confidence that the general approach being taken was consistent with what has been developed elsewhere, and is widely recognised to be good practice. These reviews were also used to ensure that there were no significant omissions from the elements in the checklist.

As part of the appraisal stage, the preliminary checklist developed in the early stages and used to evaluate the different frameworks was also reviewed with the OPPPA and the Parties to the PPP contracts (London Underground, Tubelines, Metronet BCV and Metronet SSL). These reviews and the consequent feedback obtained were taken into account when developing the final framework.

The output of the appraisal stage was an assessment of the strengths and weaknesses of each of the key frameworks identified in all the five criteria. The key findings of the appraisal stage can be found in 1.4.2.

1.4.1 Assessment of Measurement Approaches The evaluation of the different approaches to measurement was based on the key frameworks identified during the literature review. This evaluation identified the strengths and weaknesses of each approach as well as their suitability to the London Underground PPP environment.

The evaluation of the assessment tools was carried out based on three criteria:

• General approach • Effectiveness and adequacy • Applicability to OPPPA Evaluation Framework.

Table 2 below shows the criteria by which the measurement approaches were assessed.



General Information

Metric type Check list or maturity model Assessment method

Qualitative or quantitative assessment

Scope of assessment

Number of Asset Management elements/principles assessed. Number of elements the assessment focuses on.

Questionnaire Number of questions used to perform the evaluation Scoring Scoring system (e.g. 1-5, 0-5) Visual progress review

Visual representation of results. Record progress in achieving Asset Management good practice.

Self assessment Ease of self-assessment by users. Effectiveness and Adequacy

Adequacy and balance

Adequacy of coverage of all the key elements/principles. Balance of element coverage.

Continuous improvement

Facilitation of continuous improvement. Identification of gaps to allow the implementation of corrective actions.

Simplicity Simplicity of understanding and use. Need for an external expert third party.

Communication of results

Does it allow an effective communication of results and conclusions across all levels of the company?

Applicability to OPPPA model

Added value Lessons learned applicable to the OPPPA Asset Management Evaluation Framework.

Table 2. Measurement Evaluation Criteria The conclusions of the evaluation of the different approaches to measurement exercise can be found in Section 1.4.2.4. Detailed information about the assessment of each of the key framework’s measurement approaches has been included in Annex II.

1.4.2 Asset Management Appraisal Findings

1.4.2.1 Objectives The objectives and hence the approaches of the Evaluation Frameworks differ. The following is a description of their objectives:

• PAS 55 was developed as a comprehensive cross-industry standard, including both clear requirements and also guidance on how to achieve compliance. It states mandatory requirements however it does not prescribe how they should be met but does provide optional guidance. It also allows for independent verification leading to certification.

• The GAMO matrix was developed to give London Underground a simple overview of what constitutes good practice in Asset Management, cross sector, at a high organisation-wide level. It has since been validated in Australia by a cross sector Asset Management workshop. This intent has guided the GAMO matrix to be a simple matrix of practice, ranked from



innocence to world class, but with no detailed guidance on use, assessment or evaluation.

• Main Roads WA, Austroads, South Australia and AASHTO are all highway focused approaches, developed in the main by federal agencies to support the development and improvement of Asset Management by state transportation departments. They are in effect national industry ‘standards’, providing self-assessment tool kits for highway managers. These approaches have developed to cover wider municipal asset bases.

• The GHD/AMCL approach is a proprietary model, developed to allow assessment of Asset Management practice across various industries. It allows benchmarking against external standards, industry good practice and also own historical performance, as well as identifying routes towards improvement.

1.4.2.2 Structure • The approaches vary in terms of the need for and clarity of a clear

structure. The simplest and clearest structures of those reviewed are AASHTO and PAS 55.

• The GAMO matrix, by definition, does not have a structure. Its format is of a simple matrix under six headings with a maturity level of one to five.

• PAS 55, AASHTO, Austroads and the IIMM all follow the Plan-Do-Check-Act cycle, which provides them with a clear base structure. However they all differ in their complexity and emphasise different aspects of Asset Management. For example, while AASHTO clearly focuses on the importance of information management at the different stages of the PDCA, IIMM highlights the need to link the Asset Management cycle with the stakeholder and external requirements.

• Stakeholder and other external requirements are included in their frameworks by both AASHTO and the IIMM. In the case of PAS 55 and Austroads, whilst external factors are recognised as important, they are defined outside the formal structure.

• Information is addressed within the structure by the IIMM and PAS 55, and in the case of AASHTO right across the Asset Management cycle.

• All of the frameworks address the softer ‘people’ and ‘internal environment’ issues, but Austroads is particularly weak in this area, focusing more on the physical asset lifecycle.

• In terms of asset types, PAS 55, Austroads and the IIMM are focused on physical assets, referring to others (e.g. human, financial) only in support of the physical assets. AASHTO provides a broader evaluation, including some of these other asset types.

• The approaches of Main Roads WA and GHD/AMCL do not offer a formal structure, and certainly no flows, but some shape can be implied from their grouping of elements.

1.4.2.3 Elements • All of the frameworks reviewed cover the majority of the elements

identified in the checklist. There is a core of elements that is consistent across all of the frameworks.



• The majority of the frameworks identify the customers/stakeholders/business needs as the primary element of Asset Management.

• Most frameworks identify best practice processes in Asset Management. Risk management and information management are both ever present elements.

• Although the review stage is identified in most of the frameworks, they do not all make direct reference to continuous improvement.

• People and structure related issues are not always referred to, and other ‘soft’ elements such as sustainability, consistency, and appropriateness of Asset Management frameworks do not seem to be covered. Culture is also rarely considered.

• In some cases many of the elements which are not identified explicitly in the framework are covered in supplementary guidelines or manuals. This is commonly the case with the ‘soft’ elements.

• The checklist was also reviewed with the OPPPA and the Parties to the PPP contracts (London Underground, Tubelines, Metronet BCV and Metronet SSL).

1.4.2.4 Measurement Out of the eight models evaluated, three different types of assessment tools were identified:

• Check list approach • Maturity model with specific requirements • Maturity model with guidelines.

The main findings of the measurement analysis were:

• While AASHTO follows a checklist approach, GAMO and the IIMM models use a requirement based maturity model, and Austroads (as well as Main Roads WA) and OFGEM follow a guideline based maturity model with a common maturity matrix.

• All of the models allow for self-assessment. Third party assessors may be used where the approach is more complex or independence is required.

• Some of the approaches are more prescriptive than others, with the associated benefits and constraints. The more prescriptive approaches have the advantage of being easy to carry out, once the framework has been defined. The maturity approach is a more qualitative approach, but allows the framework to be defined more by the needs of the organisation, but does require a trained auditor.

• The majority of the models allow a final visual representation of the outcome, which facilitates the understanding and communication of the results, as well as the identification of gaps and areas for improvement. This is the case of GAMO, Austroads, AMCL, IIMM and OFGEM.

• Although some models such as Main Roads WA obtain a final score as a result of the assessment, the majority of the models focus more on evaluation of the competence level or scoring of the different elements. This allows a better identification of the gaps related to each element and therefore facilitates the implementation of corrective actions.



• Of the eight key approaches to measurement evaluated, the guidance based maturity assessment approach is considered to be the most appropriate for the OPPPA Asset Management Evaluation Framework.

• The guidance based maturity model takes a flexible approach that with informed self-assessment allows the organisation to adopt the most appropriate approach. This approach is less prescriptive and fits with other frameworks and approaches.

A summary of the strengths and weaknesses of the different approaches is provided in Table 3 below.

Strengths Weaknesses

Check List Easy to use

Consistency of approach

Does not evaluate competence

Restrictive and limited

Maturity with requirements

Consistency of approach

Clarity of interpretation

Rigidity of definitions

Need for agreement on requirements

Potential for disagreements

Maturity with guidelines

Flexible approach

Allows informed self-assessment

Fits with other frameworks and approaches

Allows adoption of appropriate approaches

Promotes learning and development

Standard measurement definition

Requires more informed and experienced assessment

Open to differences in interpretation

Table 3. Strengths and Weaknesses of Measurement Approaches

1.5 Draft Framework Once the checklist had been fully evaluated and reviewed with the Parties, and it had been validated that all of the key areas of Asset Management had been covered, it was then possible to develop a logical framework tying all the elements together. The purpose of the framework was to ensure clarity and an understanding of the approach taken, identifying the linkages and dependencies between elements, and allowing a differentiation between the ‘harder’ and ‘softer’ elements.

The analysis identifies 12 core elements of Asset Management fitting them together into a logical outline structure. The elements include both the ‘harder’ process elements within the central PDCA cycle, but also ‘softer’ elements relating to the internal environment and human factors.

The preliminary framework, as outlined in Section 1.5.1, is a first step in the development of the final Asset Management Evaluation Framework.

Although it was important to develop a clear framework for the reasons outlined above, it should be made clear that this is not a framework for detailed evaluation,



which prescribes how Asset Management should be undertaken. In contrast, it is a high level approach which ensures that all the important aspects and components of Asset Management are included and considered, and provides pointers to those external frameworks and approaches which can provide good information in these areas. The approach should be seen as a contribution to the continued development of good Asset Management within the Infracos and London Underground, rather than as a complete and comprehensive framework for implementation.

1.5.1 Preliminary Framework Once the checklist had been fully evaluated and reviewed with the Parties, and it had been validated that all of the key areas of Asset Management had been covered, it was then possible to develop a logical framework tying all the elements together.

The analysis identified eight key components of Asset Management that fit together into a logical structure. This contains not only the central PDCA cycle, but also aspects relating to the internal environment. This is illustrated in Figure 6 below.


PlanningPlanning

DeliveryDeliveryRisk ManagementRisk Management

InformationManagementInformation

Management

AssetsAssets

Rev

iew

(C

heck

and

Act

)R

evie

w

(Che

ck a

nd A

ct)

Internal Environment

Figure 6. Preliminary Framework As well as the eight high level components being internally consistent, this approach also ensured that all of the elements identified and validated through the checklist process fitted within one of the high level components. These are shown in Figure 7 below:




Stakeholders

PlanningPlanning

StrategyObjectivesTargetsPlan

Delivery ManagementDelivery Management

Resource ManagementCommercial TacticsSupply Chain

Whole Life CostingTimeframe

Risk ManagementRisk ManagementBusiness Risk ManagementSafety Risk ManagementEmergency and RecoveryBusiness Cont Management

Information ManagementInformation ManagementBusiness ObjectivesScopePolicy

External Requirements

Asset Groups/Individual AssetsAsset Groups/Individual Assets

InternalEnvironment

InternalEnvironment

LeadershipContinuous ImprovementGood Industry PracticeCultureOrganisationResponsibilities, Authority and AccountabilitiesCompetencyknowledgeCommunication

SustainabilityConsistencyAppropriateness

Review (Check and Act)Review (Check and Act)

Performance Measuring and MonitoringAuditManagement ReviewCorrective Action

Information and KnowledgeManagement

Whole Life Approach

Figure 7. Detailed Preliminary Framework

1.6 Review by Parties Throughout the study it was important to maintain an engagement with all of the Parties to the PPP, to keep them abreast of how the work was developing and to ensure that their views and concerns were considered and addressed as appropriate. Therefore meetings were held at regular intervals during the study with London Underground and the three Infracos.

In addition, the Asset Management Strategies of each of the three Infracos were reviewed. This was helpful in ensuring that the framework remained pertinent and relevant to the Infracos. The review of the Asset Management Strategies, together with the meetings held with the Infracos and London Underground, identified those Asset Management elements considered of particular importance by the Parties, and it was thus important to address these in the framework. These elements were:

• Asset whole life costing • System integration • Investment split between operating and capital expenditure • Environmental management and quality management • Technology and innovation management • Value (and cost) management • Interface management • Staff motivation

All of these elements had been addressed in the draft framework, albeit in some cases implicitly, but it was important to ensure that they were considered more explicitly within the Key Areas, Guidance and Evaluation Tables for the final Framework.

1.7 PPP Contract Requirements The Asset Management Elements were reviewed against the PPP contracts to ensure that contractual references and requirements related to Asset Management were reflected in the framework.



There are five main sections in the PPP contract making direct reference to and setting requirements related to Asset Management. The five main sections that related to Asset Management in the contract are Service Contract, Part A and Service Contract, Part C of the service contract, Schedule 1.9, Schedule 3.1 and Schedule 3.2. The following table presents the parts/schedules and paragraphs of the PPP contract in which the main Asset Management requirements are outlined:

Part/ Schedule Paragraph Title

Service Contract Part A

Preliminary Provisions

Service Contract Part C

Asset Management Services and Contract Management

Paragraph 6.5 Guidance to the Statutory Arbiter Schedule 1.9 Annex 2 Paragraph 9 Partnership

Paragraph 1 Objective

Paragraph 2 Asset Management Obligations

Paragraph 3 Asset Management Regime

Paragraph 4 Joint Working Groups

Paragraph 5 Asset Management Strategy

Paragraph 6 Annual Asset Management Plan

Schedule 3.1

Paragraph 7 Work Package Plans

Paragraph 1 Reasonable Life Expectancy and Benchmarks Schedule 3.2

Paragraph 3 Development of Measurement

Table 4. PPP contract Asset Management requirements

The Asset Management Evaluation Framework covers all of the Asset Management contractual requirements set in the different clauses under the paragraphs listed above. Annex IV includes a cross-reference of contract clauses against the 12 elements of the framework. This is included to assist in the understanding of how the framework relates to Asset Management in the PPP environment and specifically facilitates the identification of which Elements and Key Areas within the framework relate to each of the requirements concerning Asset Management, as set out in the PPP contracts.

1.8 Development of Measurement Approach The analysis of measurement approaches had shown that different approaches to evaluation exist and these fall broadly into two types of approach: checklist and maturity.

1.8.1 Checklist Approach The checklist approach lists the aspects of Asset Management that are deemed necessary by that particular framework, and uses a checklist to ‘tick’ these off. In most cases an organisation is required to obtain a certain number of ‘ticks’ in



different areas in order to be evaluated at a particular level. An example of this approach is AASHTO. A similar but slightly different approach scores the organisation being evaluated against particular attributes of Asset Management and again these are aggregated, sometimes with a weighting given to attributes deemed of more importance, and this provides an overall score for the organisation’s Asset Management.

The checklist approach is prescriptive and requires certain attributes and components of Asset Management to be achieved, but has the advantage of being quite objective, once the framework has been defined.

1.8.2 Maturity Approach The maturity approach is a more qualitative, less prescriptive, approach. It follows the GAMO methodology developed for London Underground and is broadly based on the Capability Maturity Model (CMM) used in software development and Crosby’s Quality Management Maturity Grid (QMMG).

The maturity approach presents a set of broad areas which are necessary for good Asset Management but does not prescribe exactly what must be done or show how it should be carried out. Rather it provides some pointers and outline guidance for development of competence in that particular area. For each of the areas specified the organisation can achieve a maturity level, expressing the level of its development and competence.

Compared to the checklist approach, the maturity approach is a more qualitative approach but allows the framework to be defined more by the needs of the organisation being evaluated. Therefore within the context in which the Asset Management Evaluation Framework has been developed for the OPPPA, it was clear that the maturity approach was the more appropriate.

1.8.3 Resulting Evaluation Approach The purpose of this study was to identify the areas recognised as important for Asset Management by the various approaches included in the literature review. In addition, the study provides some guidance as to what might be included in each area and pointers as to which external frameworks provide the most extensive guidance. This would allow an Infraco to carry out an assessment to determine what level it would wish to achieve at a particular stage of the contract period and equip it to evaluate what level it was actually achieving. Thus the framework would provide an overview of the maturity of the Asset Management within the organisation.

This approach puts the onus on the organisation being assessed to determine the maturity level to which they aspire for any particular element, and the process of evaluation and determination itself supports and promotes increased understanding of Asset Management. However it does also require a certain level of knowledge and competence both in Asset Management and evaluation capability from those carrying out the assessment.

The approach put forward in this study has a measurement hierarchy of six levels, from nought to five: level 0 indicates little or no competence and level 5 a world class performer. It is preferable to have an even number of maturity levels as this does not have a median level. It was also felt that six levels provide a reasonable



range of maturity, allowing sufficient granularity without overcomplicating the approach.

Within the general maturity concept, two approaches exist. One is to provide guidance for each of the maturity levels for each of the elements and the other is to establish a single set of definitions for all of the elements, but to provide guidance as to what might be expected from that element in general.

Again it was felt more appropriate given the purpose of the Evaluation Framework to make the approach as broad and non-prescriptive as possible. Therefore the approach proposed is one based on a general set of definitions. The 12 Asset Management Elements determined and agreed are of two types: Asset Management Process Elements and Asset Management Enabling Elements. The Process Elements relate to the PDCA Asset Management process and the asset cycle whereas the Enabling Elements are more related to the organisation and human factors. For this reason a separate set of maturity level definitions was established for each group, but they were made as consistent as possible to ensure that any evaluation would itself be consistent and balanced.

1.9 Cross-reference against Asset Management Frameworks The framework was cross-referenced against the key external frameworks to ensure that all the important discussion and guidance related to the elements were included appropriately and fully referenced.

As a result of this exercise, a link between the key areas and considerations and those frameworks that best address them was established. These links facilitate the identification of the key framework and guidelines that could assist the parties in developing each of the Asset Management elements further.

Four of the publicly available frameworks provide guidance which should be considered (AASHTO, Austroads, IIMM and PAS 55), and where one of these frameworks provides extensive guidance on a particular element, that clause or section is identified.

A full overview of these cross-references is provided in Annex III.

1.10 Internal Workshop (Development and Validation) Once the draft framework had been fully reviewed with the OPPPA and all of the Parties, an internal workshop was held with members of the Lloyd’s Register Rail Asset Management team. This included individuals with experience as duty holders, in academia and in asset management verification. This workshop was used to take the final Asset Management elements, cross check and confirm the component areas, and develop some basic guidance for each as well as to validate the measurement methodology.

1.10.1 Development of Guidance Although the approach to Asset Management evaluation put forward by this study is a maturity approach, in was still valuable to offer some guidance as to what might be included within each element, and how each element might be developed and applied within an organisation. This guidance is provided logically and succinctly for each element.



Each of the Asset Management Elements is carefully structured to include a small number of key areas which comprise the wider element. For each of these key areas guidance is provided in Appendix C to the main report. Appendix B contains a summary table containing each of the elements, key areas and a summary of the guidance, the main considerations.

This guidance is not prescriptive and is certainly not to be seen as requirements as would be found in a standard. It is provided as a means of additional explanation for each of the elements, the key areas and their component attributes. It is included in the report to further understanding of the Evaluation Framework and to provide assistance to the OPPPA or any of the Parties who may wish to make use of the Framework.

1.10.2 Validation of Measurement Methodology As well as developing the key Areas, main considerations and guidance, the internal workshop was used to validate the measurement methodology developed previously. This was done through discussion and a strengths and weaknesses analysis of the different measurement methodologies (see Table 3).

ANNEX II REVIEW OF APPROACHES TO

ASSET MANAGEMENT EVALUATION

OPPPA Asset Management Evaluation Framework Annex II


1. Asset Management Frameworks

The frameworks identified and used for the development of the Asset Management evaluation framework are:

• AASHTO. Transportation Asset Management Guide, 2002. • AMT Sybex. Tube Lines Asset Management Transformation Programme.

Developing Asset Management Regimes for Asset Specific Groups, 2004. • ANZECC Working Group on National Parks and Protected Area

Management: Benchmarking best practice in AM. • Austroads. Integrated Asset Management guidelines or road networks. • Austroads. Road Network Asset Management International Benchmarking

Study, 2002. • BP-Amoco, Getting HSE Right – a guide for BP-Amoco Managers, 1999. • GHD/AMCL. Asset Management Excellence Model, 2005. • Government of South Australia. Energy Management Guidelines (EMG),

1998. • Government of South Australia. Strategic Asset Management Framework,

1999. • International Infrastructure Management Manual (Australia/New Zealand

edition), 2000. • Main Roads Western Australia: A framework for assessing Asset

Management performance in Australia. • Maine Macro Maintenance Strategy. • OFGEM, 2002.

- Asset Risk Management Survey: Composite Industry Report. - Asset Risk Management Survey: Part 1 Survey Guide. - Appendix A of the survey guide: OFGEM Asset Risk Management

Survey Questionnaire (consultation version). • Publicly Available Specification (PAS 55) Part 1 and 2. British Standards

Institution, 2004. • Queensland Water. Guidelines for Implementing Total Management

Planning. • Railway Technology Strategy Centre, Imperial College London. Lloyd’s

Register Asset Management Study Summary Report, 2003. • Ruth Wallsgrove (On behalf of London Underground). GAMO, 2004. • US Department of Transportation. Asset Management Primer, 1999.



1.1 Framework Classification

Framework Industry Country Relevance

GAMO General Australia High

PAS 55 General UK High

Main Roads WA Road/Highways Australia High

Austroads Road/Highways Australia High

GHD/AMCL General/Rail Australia High

AASHTO Road/Highways USA High

International Infra. Mgmt. Manual General Australia /

NZ Medium

OFGEM Energy/Power UK Medium

Government of South Australia State Assets Australia Medium

AMT Sybex General UK Medium

EMG Energy/Power Australia Medium

Asset Management Primer Road/Highways USA Low

Integrated AM Guidelines General Australia Low

Queensland Asset Management Water Australia Low

Benchmarking best practice in AM National Parks Australia Low

Imperial College AM Study Report General UK Low

BP-Amoco HSE Management Guide Energy/Power UK Low

Maine Macro Maintenance Strategy General UK Low

Table 1: Framework Details



2. FRAMEWORK REVIEW APPROACH

This appendix contains detailed analysis of eight asset management evaluation frameworks. These include the six frameworks identified as key, as well as two others, which are the International Infrastructure Management Manual (IIMM) and the OFGEM Asset Risk Management Survey. The IIMM is included as it has been at the centre of much of the development of asset management in recent years, and OFGEM as the only regulatory approach identified.

The detailed analysis looks at the objectives and approach of each framework and evaluates the structure, asset management elements and evaluation metrics.

The output of the detailed analysis is a summary of the strengths and weaknesses of the different frameworks. This information is key to the development of a robust and well balanced final asset management evaluation framework.

Figure 1: Framework Review Components

The appendix contains detailed analysis of the following eight asset management evaluations frameworks:

• GAMO • PAS 55 • Main Roads Western Australia • Austroads • GHD/AMCL • AASHTO • International Infrastructure Management Manual • OFGEM



3. Framework Review Result

The outcome of the final analysis follows the following structure:

• Summary table: presents the main findings of the analysis including summary & objectives, key dimensions structure, elements and assessment system.

• Structure: provides a description of the structure of the framework, together with a graphic if this is available.

• Elements: shows the asset management elements included in the framework compared to those in the checklist. This is presented in the form of the checklist with those elements covered in the framework highlighted, as below:

Figure 2: Elements Covered in the framework

• Elements: provides the main findings and result of the evaluation of the measurement approaches followed by the key frameworks.



3.1 PAS 55

3.1.1 General Characteristics

Country UK

Industry General

Type of Document Specification

Assessment Tool Yes

Table 2: PASS 55 general characteristics

3.1.2 Summary and Objectives PAS 55 was developed in response to demand from industry for a standard for the implementation and execution of asset management.

It is applicable to any organisation in which physical assets are a key or critical factor in achieving its business objectives and in achieving effective service delivery.

The main characteristics of this document are shown in Table 3 below:

Characteristics Description

Structure The PAS 55 structure follows a clear PDCA cycle. Although the structure could seem to be very process oriented, it has a good balance between process and non-process elements. The framework also establishes a clear link between the business objectives and the asset performance and operation.

Elements PAS 55 widely covers most of the “hard” and “soft” elements of asset management. Both PDCA related elements as well as “soft” elements are widely covered. However, the framework does not refer explicitly to knowledge management or supply chain management.

Assessment System

PAS 55 does not have an explicit quantitative evaluation tool, however, as a specification it is used as the basis for verification and validation of an organisation’s asset management system and processes against each of the sections and elements clearly structured in the framework.

Key Dimensions

1. Organisational Strategic Plan, AM Policy and Strategy 2. Asset Management information, risk assessment and planning 3. Implementation and Operation 4. Checking and Corrective Actions 5. Management review and continual improvement

Table 3: PAS 55 specific characteristics



3.1.3 PAS 55 Structure The structure of PAS 55 follows a PDCA cycle approach, with the planning and review stages split into two within the cycle.

The PAS 55 structure is not over complicated and presents a clear process oriented structure.

The framework links the organisation from the business objectives, down to asset performance through policy, strategy, objectives and targets, through an asset management plan.

PAS 55 clearly highlights the need for review through checking and corrective action, senior management review and through the organisation’s continuous improvement.

AssetManagement

System

Implementation& operation

4.4

Checking &


Checking &


Management

Review4.6Management

Review4.6

Policy& Strategy4.2

Policy& Strategy4.2



Figure 3: PAS 55 Structure



3.1.4 PAS 55 Elements PAS 55 covers the majority of both process related and “soft” elements.

Although elements such as leadership, culture and motivation are outside its scope, the need of leadership by the executive is clearly stated.

The need for training and required competencies is covered in the framework, although there is no reference to knowledge management.

The management of human, financial and information resources is mentioned throughout the framework.

PAS 55 is not explicit on the management of contractors and the supply chain, although it does require that they are aware of its requirements.




PlanningPlanning

•Physical•Human•Financial•Information•Intangible

Asset InterfacesAsset Interfaces

•Delivery Management•Information Management•Risk Management

ProcessesProcesses

•Continuous Improvement•Sustainability•Consistency•Appropriateness•Leadership•Culture•Organisation•Responsibilities•Competency•Knowledge•Communication



ReviewReview

Other

•Whole Life Approach•Timeframe•Resources Management•Commercial Tactics•Supply Chain•Good Industry Practice•Explicit Model

Figure 4: PAS 55 Elements



3.1.5 PAS 55 Metric Assessment

Metric type Standard

Method Qualitative

Main Elements 21 main principles

Total Questions No questions

Scoring No

Outcome Gap analysis / Audit

Progress Review No

Self Assessment Yes

Table 4: PAS Metric Assessment Summary

Effectiveness and Adequacy: PAS 55 does not itself provide an explicit evaluation tool, although it facilitates a qualitative gap analysis and therefore facilitates the implementation of corrective actions for each one of the AM principles.

It provides a well structured model in which all the principles are clearly presented, described and their importance highlighted where necessary.

Although PAS 55 allows self assessment, it might require external support to perform a robust and powerful assessment.

The PAS 55-2 guidelines outline all the key aspects relevant to each of the AM principles. This allows the user to understand the key issues that need to be considered for each of the elements.

As it does not provide any visual representation of the outcome it is difficult to show simply and to communicate the results as well as the progress towards future AM objectives.

Applicability to OPPPA model:

The guidelines provided by PAS 55-2 would complement the qualitative approach taken by a maturity model. Through outlining the key aspects related to each of the elements, it facilitates the overall understanding of the principle itself and the assessment process.



3.2 GAMO


Country Australia

Industry Various/Rail

Type of Document Evaluation Matrix

Assessment Tool Yes

Table 5: GAMO general characteristics

3.2.2 Summary and Objectives This document provides an assessment tool that can evaluate progress in Asset Management by evaluating competence against six key elements.

GAMO was developed by Ruth Wallsgrove of the Institute of Asset Management on behalf of London Underground, during 2004. It was validated by asset management experts at a workshop in Australia in September 2004.

The main characteristics of this document are shown in Table 6 below:


Structure GAMO does not follow any formal structure. It is based on six high level dimensions which are essential for a good asset management organisation.

Elements GAMO evaluates six key high level Asset Management elements. These six elements cover both Asset Management processes such as information, risk and review processes as well as other “soft” elements reflecting the need for an organisational structure with adequate roles and an active leadership.

Assessment System

Each of the six elements covered in the GAMO matrix is measured against a competence or maturity level that goes from “unaware” to “world class”. The format allows current as well as mid and long term progress towards asset management best practice to be visually represented.

Key Dimensions

1 AM leadership with urgency 2 Integrated whole life decisions on risk to delivery 3 Good asset information management 4 Integrated AM processes & appropriate roles 5 Shared explicit AM vision 6 Continuous AM change programme

Table 6: GAMO specific characteristics



3.2.3 GAMO Elements The GAMO matrix covers six key high level elements (elements that constitute the headings of the matrix), but also makes reference to other important elements in the description of the different levels of competence (in italics in the diagram).

GAMO covers both “hard” and “soft” elements of Asset Management. However, particular emphasis is given to the importance of leadership and continuous improvement.

One of the particularities of GAMO is that establishes the need for an explicit asset management model.

GAMO also highlights the importance of risk and information management.




PlanningPlanning




ProcessesProcesses




ReviewReview

Other


Figure 5: GAMO Elements



3.2.4 GAMO Metric Assessment

Metric type Maturity Model

Method Qualitative

Main Elements 6 Key principles


Scoring 1-5

Outcome Visual Matrix

Progress Review Yes

Self Assessment Yes

Table 7: GAMO Metric Assessment Summary

Effectiveness and Adequacy: The GAMO matrix measures six key AM principles against five levels of competence or maturity from ‘unaware’ up to ‘world class’.

It is a simple easy to use matrix that allows self assessment. The outcome is visually presented facilitating the track of progress by establishing colour bands for past, current and target levels of AM competence. The results as well as the evaluation process is easy to communicate and can be easily understood by all the staff.

GAMO only looks at six key AM enablers. Although it does provide a good coverage of these key enablers, it does not cover all important AM principles, therefore high competence following the GAMO matrix does not ensure overall competence in AM.

One of the negative aspects of the maturity model is that it is not easy to identify gaps in specific lower level areas, and therefore it is not the most effective tool to implement corrective actions.

Applicability to OPPPA model: Although a maturity with guidance model has been identified as the way forward for the development of the OPPPA AM evaluation framework, GAMO provides a good example of a possible way of establishing the maturity levels.



3.3 Main Roads West Australia (WA)


Country Australia

Industry Highway

Type of Document Framework

Assessment Tool Yes

Table 8: WA general characteristics

3.3.2 Summary and Objectives Paper prepared for the 14th International Road Federation World Congress in Paris, 2001.

As more highway agencies adopt a more holistic view of asset management, a need was recognised for a framework for agencies to track and rate their performance in adoption of asset management.

The main characteristics of this paper are shown in Table 9 below:


Structure The framework does not present any explicit structure linking the different elements described throughout the document. However, some linkage is provided through the description of the elements.

Elements Covers seven key asset management elements paying significant attention to “soft” issues such as leadership and responsibilities.

The implementation/delivery stages of the asset management cycle are not given the attention they require.

Assessment System

The assessment tool is based on Austroads framework. The self-assessment kit consists of a list of 50 questions addressing the seven key elements of asset management. Each question has a score between 0 and 5. A score of 200-250 indicates best practice in asset management.

Key Dimensions 1. Agency Objectives and Stakeholder Requirements 2. Strategy and Planning Process 3. Data, Information and Knowledge 4. Business Results 5. People 6. Leadership 7. Audit and Review

Table 9: WA specific characteristics



3.3.3 Main Roads West Australia (WA) Elements The Main Roads WA framework covers most of the key high level elements, providing a balance between process related elements and “soft” ones.

The framework pays particular attention to the need for aligning the strategy and planning process with the external requirements supported by robust information management systems.

The importance of a strong leadership and clear roles and responsibilities is clearly stated.

Although little reference is made to the implementation stage, the need for continuous review of the asset management activities is highlighted.




PlanningPlanning




ProcessesProcesses




ReviewReview

Other


Figure 6: Main Roads WA Elements



3.3.4 Main Roads West Australia (WA) Metric Assessment

Metric type Undefined

Method Quantitative

Main Elements 7

Total Questions 50

Scoring 1-5

Outcome Score/250

Progress Review No

Self Assessment Yes

Table 10: Main Roads WA Metric Assessment Summary

Effectiveness and Adequacy: The Main Roads WA metric is based on the Austroads international benchmarking assessment tool. It is not an exact check list type of evaluation tool, and each of the questions looks into competence levels as well as consistency with other areas of Asset Management as well as with company objectives.

It is a simple model that allows self assessment and does not need any external support to perform the evaluation.

The outcome is a quantitative final value that indicates out of 250 the percentage of compliance or competence. However, it does not facilitate the gap analysis or provide an easy visual way of tracking the progress in Asset Management for each of the different elements.

The evaluation model focuses mainly on the ‘strategy and planning process’ and ‘data, information and knowledge’, which represent 130 out of the total 250 points, giving the other elements low priority.

Overall, the outcome of the assessment is not meaningful in its own right and therefore it does not necessarily contribute to the continuous improvement within an organisation.


The Main Roads WA model provides some good examples of approaches to measuring the an organisation’s proficiency in some of the elements that will be assessed in the OPPPA Asset Management Evaluation Framework.



3.4 Austroads


Country Australia

Industry Highway

Type of Document Guidelines

Assessment Tool Yes

Table 11: Austroads general characteristics

3.4.2 Summary and Objectives This document provides guidelines to highway agencies in Australia for the development and implementation of an integrated asset management framework for managing road networks, as part of each agency's overall business planning cycle.



Structure The framework follows a PDCA approach and covers both AM as well as asset cycles. The focus is mainly on the planning stage. The implementation/delivery stage is mentioned but it is only covered to a limited degree. The stages within the PDCA cycle are well integrated and inter-linked.

Elements The framework is focused more at the practitioner level and therefore it is very process oriented. Little attention is paid to other "softer" AM elements such as culture, leadership etc. The document also covers some lower level AM elements related to the asset life, across the asset lifecycle from acquisition through to disposal.

Assessment System

The assessment tool was used to carry out an international benchmarking exercise. The seven elements of asset management evaluated are divided into a total of 21 assessment criteria. An evaluation guideline and a scoring 0-5 is established for each criterion and a weighting applied. The final score is looked up in a table that indicates the significance of this score.

Key Dimensions

1 Define Objectives 2 Form Asset Strategies 3 Develop Investment Programme 4 Identify Asset Requirements 5 Implement Work Programmes 6 Audit 7 Review



Table 12: Austroads specific characteristics

3.4.3 Austroads Structure The Austroads model follows a PDCA cycle approach at three different levels: Asset Management Strategic Level, Network Level and Asset Level.

The model does not explicitly identify the external link with stakeholders, although stakeholders’ requirements are implicit as the entire model is developed around an agreed level of service.

The structure of the model is very much process oriented and leaves “soft” issues out the main structure entirely.

The framework guidelines include a more detailed Integrated Asset Management Process Flow Diagram, in which the different elements and activities involved in the PDCA cycle are identified.

Figure 7: Austroads structure



3.4.4 Austroads Elements The Austroads model focuses on the elements of the PDCA cycle as well as the ones related to the stakeholders and the community.

Elements such as sustainability and consistency are also mentioned as a requirement for a successful integration of the different stages of the PDCA cycle.

However the model does not cover the need of a risk based approach.

The model is also limited in its coverage of “soft” elements such as leadership, responsibilities, competency etc.




PlanningPlanning




ProcessesProcesses




ReviewReview

Other


Figure 8: Austroads structure



3.4.5 Austroads Metric Assessment

Metric type Undefined

Method Quantitative

Main Elements 7

Total Questions 39

Scoring 0-5

Outcome Weighted score

Progress Review No

Self Assessment Yes

Table 13: Austroads Metric Assessment Summary

Effectiveness and Adequacy: The Austroads assessment tool was developed for use in an international benchmarking project looking at Asset Management across several highway agencies.

Its evaluation method is similar to the one used by the EFQM model, in which a questionnaire outlines the requirements of a fully competent and compliant organisation, and the assessment is carried out based on the number of requirements an organisation complies with.

For evaluation purposes, the seven main parts of the model are subdivided into a total of 21 assessment criteria. Each of the criteria is evaluated against a guideline and is then weighted depending on its importance and criticality within the integrated Asset Management process.

The assessment tool facilitates benchmarking of the different Asset Management elements against other organisations, however it does not facilitate the identification of gaps against good practice.

The tool does not facilitate the representation or evaluation of the progress towards Asset Management good practice.


The way questions and requirements are outlined throughout the guideline should be considered and followed in the OPPPA model. It follows a maturity with guidance type of model, which is the preferred approach for the development of the OPPPA evaluation model.



3.5 GHD/AMCL


Country Australia/UK

Industry Various/Rail

Type of Document Framework

Assessment Tool Yes

Table 14: GHD/AMCL general characteristics

3.5.2 Summary and Objectives This framework is based on a model developed by GHD in Australia, and represents the result of ten years of experience in asset management. AMCL, together with GHD have further developed the model to adapt it to the rail industry.

It is a proprietary but independent consultancy model that allows benchmarking against best asset management industry practice.



Structure No information regarding the structure of the AMCL model has been obtained so far.

Elements The AMCL approach pays particularly high attention to the “soft” issues of asset management as well as to the importance of a whole life approach.

Although the planning and reviewing elements seem limited in this model, the delivery, risk management and information management are well covered.

Assessment System

The quantitative assessment provides a final score that can then be benchmarked against industry best practice, best appropriate practice or interim targets (with can be 3 or 5 years). The improvement projects are identified by applying a contribution factor to the value factors of each of the elements in order to obtain a weighted value to prioritise actions going forward.

Key Dimensions

1. Processes Life Cycle Management 2. Asset Information (Support) Systems 3. Data and Knowledge 4. Commercial Tactics 5. Organisational Issues 6. People Issues 7. Total AM Plans

Table 15: GHD/AMCL specific characteristics



3.5.3 GHD/AMCL Elements The AMCL model pays significant attention to the “soft” elements of asset management.

Although the model makes reference to the importance of consultation with stakeholders, it does not highlight the importance of evaluating stakeholder and other external needs.

The model does make reference to the planning and review elements, however more attention is paid to the delivery, risk management and information management processes.

A whole life approach to asset management is also highlighted throughout the different sections of the model.




PlanningPlanning




ProcessesProcesses




ReviewReview

Other


Figure 9: GHD/AMCL Elements



3.5.4 GHD/AMCL Metric Assessment

Metric type Check list??

Method Quantitative

Main Elements 193

Total Questions Unknown

Scoring 1-5

Outcome Gap analysis

Progress Review Yes

Self Assessment No?

Table 16: GHD/AMCL Metric Assessment Summary

Effectiveness and Adequacy: The AMCL model is a check list type of assessment tool that evaluates a total of 193 Asset Management elements following several pre-defined questions outlined for each of them.

The model graphically represents the results. By making use of colour codes, it allows the visual representation of the following: company’s current Asset Management competence, long term goals, the target for the next 3-5 years and the score of world best practice for each one of the elements.

The model helps to identify and prioritise the improvement projects that would need to be implemented to achieve the interim targets within the 3 or 5 year timescale, based on the relative contribution that each improvement project will make to delivering the Asset Management objectives.

Although the large number of elements it evaluates gives the model an undesired complexity, the graphical presentation of the final results and the possibility of visually comparing the company’s situation with future targets and best practice makes it a very powerful management tool. It also facilitates the communication to all staff.


As only limited information on the AMCL model was obtained, it was not possible to make any robust conclusion about the additional value it could bring to the OPPPA Asset Management Evaluation Framework.



3.6 AASHTO


Country USA

Industry Highway

Type of Document Guideline

Assessment Tool Yes

Table 17: AASHTO general characteristics

3.6.2 Summary and Objectives The summary and objectives of this model are the following:

• Identify and document the state of the art in asset management, specifically applicable to the departments of transportation of each US state;

• Identify and document the state of the practice in asset management among the AASHTO members;

• The model is oriented at an asset management practitioner level.

The main characteristics of this model are shown in Table 18 below:


Structure The model follows a PDCA cycle approach strongly focusing on information management. Although stakeholders are not explicitly identified, the external and stakeholder requirements are well considered in the planning stage.

Elements The model is very process oriented and therefore does not cover many of the important “soft” elements. Although it is worth noting that some of the elements that are not identified in the framework are covered in the guidelines/manual.

Assessment System

Based on a number of simple questions, the responses are scored from 1-4, and a final overall value is calculated. The result can then be used as part of the discussion for developing future strategies and directions for asset management and to discuss further how well the is agency performing in various aspects of asset management.

Key Dimensions

1. Developing a Strategy 2. Policy Goals and Objectives 3. Planning and Programming 4. Programme Delivery 5. Information and Analysis 6. Implementation

Table 18: AASHTO specific characteristics



3.6.3 AASHTO Structure The AASHTO model follows a PDCA approach, which is supported by a quality information management system across all levels.

The framework is very information focused and pays significant attention to the information management element, supporting all the activities in the PDCA cycle.

The planning and programming stage also includes a resource allocation activity in which the requirements for financial, human and information resources, to achieve a certain set of objectives, are identified.

Figure 10: AASHTO Structure



3.6.4 AASHTO Elements The AASHTO framework covers the majority of the key elements identified in the checklist.

Many of the elements that are not identified in the framework are covered in the guideline/manual attached to the framework.

The soft elements are mainly the ones not identified in the framework but many are covered in the guideline/manual.

Overall the framework focuses mainly on information management, and also on the elements related to planning and aligning the planning activities with the stakeholder and external requirements.




PlanningPlanning




ProcessesProcesses




ReviewReview

Other


Figure 11: AASHTO Elements



3.6.5 AASHTO Metric Assessment

Metric type Check list

Method Quantitative

Main Elements 4 key elements

Total Questions 55

Scoring 1-5

Outcome Average values

Progress Review No

Self Assessment Yes

Table 19: AASHTO Metric Assessment Summary

Effectiveness and Adequacy: The AASHTO assessment tool is a check list type of evaluation model that was developed as a self-assessment tool for highway agencies in the USA.

The model scores each of the questions from 1-5 depending on compliance against several questions/requirement statements.

The scores of each of the subsections (four main sections, one for each of the main elements) are averaged, but an overall result is not calculated. The sub-section results are used to identify improvement areas.

The results of the self assessment are not graphically represented, which makes it difficult to communicate the results and to visually understand the current competence and the gap with the targeted competence levels.

Applicability to OPPPA model: The check list approach followed by AASHTO was considered inadequate to achieve the desired results. However, its principles and approach to Asset Management have been taken into consideration when developing the OPPPA Asset Management Evaluation Framework.



3.7 International Infrastructure Management Manual (IIMM)


Country Australia/NZ

Industry Various

Type of Document Guideline

Assessment Tool Yes

Table 20: IIMM general characteristics

3.7.2 Summary and Objectives This manual outlines a formal systematic process for infrastructure asset management, and also details the asset management activities that are necessary for a robust asset management process. The manual provides guidelines for organisations to manage all areas of infrastructure risk, develop and operate sustainable asset management networks and deliver the required services to communities at the lowest lifecycle cost.



Structure The IIMM model presents a complex framework structure based on the PDCA cycle. The structure pays particular attention to the identification and consideration of stakeholder and external requirements during the whole asset management process.

Elements The model mainly covers elements related to the PDCA cycle. Although softer elements are not considered in the framework, many of them (e.g. competency, leadership etc.) are covered in the asset management implementation guidelines.

Assessment System

The assessment framework evaluates the AM continuous improvement by assigning a score 1-5 across the different stages of the AM cycle following a capability maturity approach similar to the one used in GAMO. It presents two evaluation matrices, one for measuring the asset management lifecycle functions, and another for scoring the quality of asset management activities.

Key Dimensions

1. Corporate AM direction 2. The AM team 3. AM improvement planning 4. The AM plan 5. Implementation of AMP 6. Review and Audit

Table 21: IIMM specific characteristics



3.7.3 IIMM Structure The structure follows a PDCA cycle with stakeholder and external requirements, as well as the consequent required service levels feeding all different levels of the cycle.

A relatively high importance is assigned to the implementation of corrective or improving actions as a follow up to the review process.

The structure of the model provides a strong link between the corporate asset management direction setting activities and the asset management PDCA cycle.

An asset management team, responsible for the co-ordination of the AM activities, is identified as the link between the strategic asset management goals, objective setting and the AM PDCA cycle.

Figure 12: IIMM Structure



3.7.4 IIMM Elements The International Infrastructure Management Manual (IIMM) framework pays significant attention to the planning element. It also highlights the importance of linking the planning with the stakeholder and external requirements.

The IIMM refers strongly to consistency when dealing with the elements of the AM PDCA cycle, as well as appropriateness of the framework and of the resources to achieve the set objectives.

Risk management does not receive much attention and it is considered really only at the asset cycle level as a means of prioritisation.

This framework covers mainly hard elements with no focus on many “soft” elements within Internal Environment.




PlanningPlanning




ProcessesProcesses




ReviewReview

Other


Figure 13: IIMM Elements



3.7.5 IIMM Metric Assessment

Metric type Maturity model

Method Qualitative

Main Elements 5 principles


Scoring 1-5

Outcome Matrix

Progress Review Possible

Self Assessment Yes

Table 22: IIMM Metric Assessment Summary

Effectiveness and Adequacy: The IIMC does not provide any robust, well structured assessment tool, instead it presents two different simple models as examples of auditing Asset Management systems.

One of the examples is a GAMO type of matrix in which five different Asset Management elements are assessed against five different competence maturity levels. This matrix is described an Asset Management continuous improvement matrix. The second example is a simple rating system for scoring the quality of Asset Management activities.

Applicability to OPPPA model: None of the models presented by the IIMM are sophisticated enough for further analysis in this context. Although the IIMM Asset Management model is robust and well renowned and as such remains important for the development of the OPPPA Asset Management evaluation model, its assessment and evaluation tool is not well developed.



3.8 OFGEM


Country UK

Industry Energy/Power

Type of Document Questionnaire

Assessment Tool Yes

Table 23: OFGEM general characteristics

3.8.2 Summary and Objectives The objectives of this questionnaire are the following:

• To allow OFGEM to gain reassurance of the quality of the approaches being adopted by the network companies to the risk management aspects of their stewardship of the asset base.

• The identification and encouragement of good practice in the area of asset risk management.

The main characteristics of this questionnaire are shown in Table 24 below:


Structure The framework places significant emphasis on asset management objectives and the vertical linkage from corporate goals to actual delivery. The approach is tiered, focusing on overall business objectives, asset strategy and management across the asset lifecycle. The framework follows a fully risk based approach to asset management.

Elements The model is limited on a number of issues including non-physical asset types, people issues and sustainability.

Assessment System

A questionnaire was formulated to elicit information from each company on their approach to asset risk management. The assessment tool provides five different levels of “application” of the different AM elements and assigned a score 1 to 5 to each of these levels.

Key Dimensions 1. Business Strategy & Direction 2. Asset & Network Strategy 3. Asset Life Cycle Management

Table 24: OFGEM specific characteristics



3.8.3 OFGEM Structure The survey employs a simplified model of a generalised risk management process and has been based on a number of theoretical models.

The structure integrates the asset management within the company’s risk management. It presents a complete risk based approach to asset management.

It provides a clear vertical link between the corporate strategy/ direction, and the operation of the assets.

It highlights the importance of the review process across the whole asset risk management cycle and across the different levels of the organisation.

Figure 14: OFGEM Structure



3.8.4 OFGEM Elements The OFGEM evaluation framework covers most of the “hard” and “soft” elements.

Particular attention is paid to risk management and a risk based approach to decision making.

The review stage of the PDCA is also widely covered and is in line with continuous improvement practices.

Other strong points are the fact that it covers contractors and supply chain management within the asset management framework.

Some internal environment elements are identified in the framework but are not covered in very much detail.




PlanningPlanning




ProcessesProcesses




ReviewReview

Other


Figure 15: OFGEM Elements



3.8.5 OFGEM Metric Assessment

Metric type Maturity model

Method Qualitative

Main Elements 18

Total Questions 18 main questions

Scoring 1-5

Outcome Spider-graphs

Progress Review Yes

Self Assessment No?

Table 25: OFGM Metric Assessment Summary

Effectiveness and Adequacy: The OFGEM assessment tool evaluates around 18 Asset Management elements through several questions and sub-questions. The questionnaire requests responses from the duty holders which are evaluated to establish the scores for each of the different sections.

Although only the high level questions are scored, the sub-questions and the bullet points listed as guidelines provide further information to assist in the scoring process. The scoring process is carried out using a scoring matrix containing six different evaluation criteria.

The final results are graphically represented in spider graphs, which allow an easy visual evaluation of the current competence levels and of any gaps. These gaps are identified for each of the elements evaluated. This also allows an easy communication and understanding of the results and identification of any areas for improvement.

The assessment tool is well balanced and provides sufficient coverage of all of the 18 elements.

Applicability to OPPPA model: The overall approach is in line with the evaluation method adopted for the OPPPA in which a final evaluation is carried out based on a number of guiding criteria and a common competence table used to assess all the Asset Management elements.

ANNEX III CROSS-REFERENCE OF ELEMENTS TO

EXTERNAL FRAMEWORKS

OPPPA Asset Management Evaluation Framework Annex III


AM Elements Key Areas

PAS

55

AA

SHT

O

Aus

troa

ds

IIM

M

Stakeholder needs and external influences

Consistency with Asset Management system

Corporate values, ethics and CSR

External Requirements

Reputation and image

AM Policy and Strategy

AM Plan

Resource Planning

AM objectives and targets

Planning


Delivery Management

Resource Management

Delivery

Third Party Management


Audit

Management Review

Review

Corrective Action

Information Management





PAS

55

AA

SHT

O

Aus

troa

ds

IIM

M




Audit trail

Risk management policy




Risk Management

Business continuity management

Senior management support


Active Leadership

Leadership sustainability

Culture

Benchmarking Continuous Improvement

Change Management

Organisation Responsibility, authority and accountability

Responsibilities, authority and accountability

Competency Competency and skills




PAS

55

AA

SHT

O

Aus

troa

ds

IIM

M


Resource development plan


Management familiarity with AM

AM communication


Support systems

Communications

Communications channels

Explicit and well documented Asset Management model

Explicit Model

External references

ANNEX IV PPP CONTRACT REQUIREMENTS

OPPPA Asset Management Evaluation Framework Annex IV


Doc Clause Requirement Covered by Service Contract, Part A: Preliminary Provisions 1 The Key Objectives of the Contract are for Infraco to provide LUL with train, station and related

infrastructure in relation to the JNP Network as it may require during the Contract Period in order for LUL to operate, provide or procure the provision to the public of a modern and reliable metro service over the Underground Network in a safe, efficient and economic manner and so that:

All AM elements

(a) stewardship: Infraco maintains, renews and enhances train, station and related infrastructure (including the environment) during the Contract Period so as progressively to reduce and eliminate the existing backlog in asset maintenance and also so as to deliver a continuous overall improvement in asset health, capability and reliability in service and so that Infraco is, accordingly, at all times a good steward of the Infraco Network;

Service Contract, Part C: Asset Management Services and Contract Management C. The general purpose of this Part is to establish provisions concerning asset management and investment,

contract management and quality assurance obligations that LUL considers Infraco ought to discharge including in relation to the following objectives:

(a) Safety: to support the discharge of LUL’s general safety obligations in respect of asset condition and performance in service, as well as supporting its position as Infrastructure Controller;

Risk Management

(b) knowledgeable purchaser: to enable LUL to have such adequate knowledge and information of asset condition, performance and expenditure from time to time to be and remain a knowledgeable procurer of train, station and related infrastructure, particularly in the context of flexibility requirements and the review process;

Delivery Information Management



Doc Clause Requirement Covered by (c) insidious decline: to recognise and provide against: See below (i) the risk of asset condition declining for some time before it causes an adverse impact on service delivery

to the public; and Planning Risk Management

(ii) The risk that, once service delivery has been adversely impacted in this way, a greater period of time is required for rectification to be effected

Risk Management

(d) Information: to ensure that LUL has suitable information to assure itself by audit that Infraco is a good steward of the train, station and related infrastructure (and to provide LUL with reasonable rights, in good faith, to undertake audits for this purpose) and to enable the parties to be able to manage and resource their respective obligations appropriately

Review Information Management

Schedule 1.9 Annex 2 – Paragraph 6.5 (a) establishing and maintaining whole life asset planning and maintenance regimes Planning

Delivery (b) considering the issues relevant to each stage in any project and putting in place a strategy to deal with

them; Planning

(c) ensuring the right competence is available, including appropriate external advice when needed; Planning Competency

(d) planning for operational, contractual and financial contingencies; Planning Risk Management

(e) recognising that systems and assets must be useable in practice and taking appropriate steps to ensure this, looking at comparable industries where relevant and taking account of practical constraints

Planning Delivery Continuous Improvement

(f) recognising the time and resources needed for systems integration and taking appropriate steps to make it Planning



Doc Clause Requirement Covered by possible Delivery

(g) understanding the degraded operation of complex systems so as to ensure controlled degradation;

Planning Delivery Risk Management

(h) planning, and monitoring projects effectively, and monitoring and taking account of critical constraints Planning Review Risk Management

(i) designing to take account of buildability and operational constraints; and Planning (j) effective change management Continuous

Improvement Schedule 1.9 Annex 2 - Paragraph 9: Partnership

The Parties’ guidance to the Statutory Arbiter is that in determining the level of Infrastructure Service Charges the Statutory Arbiter should be mindful of the fact that, in the context of their respective rights and obligations under the PPP Contract, the Parties intend to work in a spirit of partnership, which London Underground described in its Invitation to Tender as follows:

“We are committed to providing the best possible Underground service to the travelling public by:

• working together to improve customer service • creating an environment based on mutual respect, trust and fairness that promotes open and honest communication at all levels • solving problems together • recognising and rewarding those who contribute to the success of the partnership • working together to achieve our “objectives” As the parties intend to work together in partnership, in accepting evidence from either party as to the likely level of future costs, the Statutory Arbiter should have regard to the extent that such information

Active Leadership Communication



Doc Clause Requirement Covered by has been shared with the other party on a timely and open basis.

Schedule 3.1 – Paragraph 1: Objective (a) Ensure that Infraco, in carrying out the Services (in particular its performance obligations and its

obligations as asset steward) improves asset condition generally so as to minimise, both during the Contract Period and for a reasonable time thereafter, the risk to safety and of service loss;

External Requirements Planning Delivery Risk Management

(b) Ensure that in so doing, Infraco adopts efficient and economic whole-life asset management as established by reference to Good Industry Practice;

All Elements

(c) Ensure that Infraco over time brings the Assets to an overall state of good condition Planning Delivery Review

(d) Provide LUL with assurance in relation to the above Planning Information Management Risk Management

(e) Assist LUL and Infraco with the efficient co-ordination of their respective activities on the Underground Network and the Infraco Network;

Planning Communication

(f) Promote confidence between the parties as to the way they will discharge their respective obligations in relation to the Delivery into Service of new Assets and Facilities

Planning Delivery Communication

Schedule 3.1 – Paragraph 2: Asset Management Obligations



Doc Clause Requirement Covered by 2.1 Infraco shall adopt and demonstrate an efficient and economic whole-life cost approach to decisions

regarding the balance between maintenance, renewal and enhancement of Assets, regardless of when in the Contract Period such decisions fall to be made which approach shall be established by reference to Good Industry Practice.

Planning Delivery Continuous Improvement

2.2 Infraco shall manage the Assets so as to comply with the obligations set out in Schedule 3.2 (Reasonable Life Expectancy, Condition Benchmarks and Residual Life Benchmarks).

External Influence Planning Delivery

2.3 Infraco shall develop and improve in accordance with good industry practice See below (a) its knowledge and understanding of the Assets; Information

Management (b) its asset management processes; Planning

Delivery (c) its understanding of the link between asset health and asset performance and the demonstration of this

within its asset information management systems, taking account of changes to technology, industry practice and engineering practice.

External Requirements Planning Information Management Competency

Schedule 3.1 – Paragraph 3: Asset Management Regime 3.1 Infraco shall develop a regime (the Asset Management Regime), which shall be documented and further

developed in accordance with this Schedule, such as will enable it to comply with the obligations set out in paragraph 2 above and to achieve the objectives set out in paragraph 1 above.

Explicit Model Continuous Improvement

3.2 During the Contract Period, Infraco shall act in accordance with paragraphs 5 to 7 below and otherwise so Review



Doc Clause Requirement Covered by as to ensure that the Asset Management Regime is and remains suitable and effective for complying with the obligations set out in paragraph 2 above and to achieving the objectives set out in paragraph 1 above.

Continuous Improvement

Schedule 3.1 – Paragraph 4: Joint Working Groups 4.1 The parties shall work together in joint groups, where appropriate with the other Infracos and other

contractors, to improve knowledge of the Assets and the required performance and condition contributions that they must, or could, make towards the desired improvements in the quantity and quality of services delivered to Customers (the Joint Working Groups).

Communication Continuous Improvement

4.2 Joint Working Groups shall initially include: (a) Asset Performance Review Meetings, details of which are included in paragraph 1 of Appendix 1 to this

Schedule; and Review Communication

(b) System Knowledge Development Forums, details of which are included in paragraph 2 of Appendix 1 to this Schedule.

Competency Communication

Schedule 3.1 - Paragraph 5: Asset Management Strategy 5.1 Infraco shall develop, document and keep current a description of its Asset Management Regime at a level

of detail sufficient to enable LUL to understand and comment on its suitability as such (the Asset Management Strategy).

Explicit Model

Schedule 3.1 - Paragraph 6: Annual Asset Management Plan 6.1 Infraco shall prepare and submit to LUL once in every Contract Year an Annual Asset Management Plan

whose purpose is: Planning

(a) To review the overall performance of Infraco in complying with the obligations set out in paragraph 2 above and to achieving the objectives set out in paragraph 1 above;

Review

(b) To review Infraco's compliance with, and the continued suitability of, its Asset Management Strategy; Review



Doc Clause Requirement Covered by (c) To describe Infraco's detailed plans and proposals in relation to the above for the forthcoming nine (9)

years based upon the then current requirements under the Contract; External Requirements Planning Explicit Model

(d) To review Infraco's progress against the objectives and proposals contained in its immediately preceding Annual Asset Management Plan;

Review

(e) To set out a Work Package Plan projection (the Work Package Plan Projection) for the relevant Contract Year containing the details set out in paragraph 6 of Appendix 3 to this Schedule 3.1.

Planning

Schedule 3.1 - Paragraph 7: Work Package Plans 7.1 Work Package Planning means the process which facilitates the dialogue between the parties about the

planning, implementation and delivery of Infraco's detailed work packages. Work Package Plan means a plan prepared in accordance with paragraph 7.

Planning Communication

Schedule 3.2 - Paragraph 1: Reasonable Life Expectancy and Benchmarks 1.1A Infraco shall maintain, renew and manage the Assets so as to ensure they have a Reasonable Life

Expectancy by no later than the end of the third Review Period. Reasonable Life Expectancy means that all Assets will be assessed as being within categories A-C in accordance with Standard E1501 and where no Condition Benchmarks or Residual Life Benchmarks are applicable to a class of Assets, the distribution of the Assets in each of categories A-C shall be in such proportions as would be achieved by an Infraco exercising Good Industry Practice taking into account the average life expectancy of such Assets.

Planning Delivery

1.1 Infraco shall maintain, renew and manage the Assets listed in Appendix 1 to this Schedule 3.2 so that on the dates specified in Appendix 1 the Assets comply with the Condition Benchmarks. Infraco shall measure the condition of the Assets in accordance with Appendix 1 to this Schedule 3.2.

Planning Delivery Review

1.2 Infraco shall maintain, renew and manage the Assets listed in Appendix 2 to this Schedule as a minimum so as to achieve the objectives outlined in paragraph 1 of Schedule 3.1, so that on the Expiry Date the

Planning



Doc Clause Requirement Covered by Assets comply with the Residual Life Benchmarks. Infraco shall measure the residual life of the Assets in accordance with Appendix 2 to this Schedule 3.2.

Delivery Review

Schedule 3.2 - Paragraph 3: Development of Measurement 3.1 The parties acknowledge that, in the interest of reducing the risks to safety and of service loss through

deficiencies in asset management, development of condition and residual life measurement techniques provide benefits to be shared by both parties and shall therefore co-operate with each other in the development of such techniques.

Risk Management Communication

3.2 During the first Review Period, the parties shall work together to improve current understanding and/or develop new condition, performance and residual life measurement processes to ensure that:

Communication

(a) In relation to Assets and processes outlined in Appendix 1 of this Schedule 3.2, the condition measurement process accurately reflects the condition of the Assets;

Delivery Review

(b) In relation to Assets and processes outlined in Appendix 2 of this Schedule 3.2, the residual life measurement process accurately reflects the residual life of the Assets;

Delivery Review

(c) In relation to Assets and processes outlined in Appendix 1 and Appendix 2 of this Schedule 3.2, over time Condition Benchmarks and Residual Life Benchmarks are improved as indicators of actual condition and/or no longer have to be specified in order to comply with the obligations set out in paragraph 2 of Schedule 3.1 and to achieve the objectives set out in paragraph 1 of Schedule 3.1 because performance measurement adequately ensures that the obligations are complied with and the objectives are achieved.

Delivery Review

3.3 In developing condition, performance and residual life measures, the parties shall take account of all relevant information available to them including, but not limited to:

Planning

(a) The results of any inspection regime; Review (b) The results of any condition surveys; Review (c) Any reports, modelling, analysis or knowledge development work by one of the parties or between the Review



Doc Clause Requirement Covered by parties on performance, condition, residual life or otherwise;

(d) The discussions and any outcome of Joint Working Groups; Communication (e) Technological advances; Competency (f) Good Industry Practice; Continuous

Improvement (g) Efficient and economic whole-life asset management. All Elements