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1 Executive Summary | Microsoft

Asset Management Program Assessment

(PAS 55)

Prepared by: UMS Group

February 6, 2013

PAS 55 Assessment of PowerStream February 2013 Final Report

Table of Contents

Executive Summary ........................................................................................................ 3

Summary of PAS 55 Assessment ................................................................................ 3

Findings and Recommendations ................................................................................. 5

Prospects for Success ................................................................................................. 6

Project Approach ............................................................................................................. 8

Gap Analysis ................................................................................................................. 11

Recommended Initiatives and Actions .......................................................................... 12

Organization Strategy, Management and People ...................................................... 12

Risk Management and Investment / Program Planning ............................................. 15

Investment / Program Delivery Management ............................................................. 17

Performance Management ........................................................................................ 18

Asset Information Management and Enabling Technology ........................................ 20

Asset Management Transformation Plan ...................................................................... 23

Asset Management Transformation Plan Analyses ................................................... 23

Asset Management Transformation Road Map ......................................................... 24

Appendix A: Listing of PowerStream Participants ......................................................... 26


Executive Summary UMS Group conducted a “soft assessment” of PowerStream’s Asset Management program in comparison to the operating model defined in the 2008 revision to the Publicly Available Specification (PAS 55). In so doing, we reviewed documentation and conducted 39 targeted interviews (refer to Appendix A for listing of those interviewed) across the entire enterprise and evaluated PowerStream’s alignment to basic Asset Management principles / practices across 7 domains and 24 areas.

Figure 1 – PAS 55 Evaluation Framework

Applying our analytical methodology, we identified 6 areas where PowerStream is adjudged nearing or at the “competence level” (scoring “3.0” or above) specified in PAS 55 (highlighted Figure 2 in Green Font), noting that PowerStream has already implemented a number of tactical initiatives that comprise an effective Asset Management Program (referred to as “no regrets” moves); and with the formulation of an effective strategy and a comprehensive communication / training plan, and continued focus on collecting / consolidating critical asset related data and information, PowerStream is well-positioned to close any remaining relevant gaps within a 2 to 3 year time period.

Summary of PAS 55 Assessment

The following figure illustrates both a UMS Group and PowerStream self-assessment. Since the PowerStream evaluations are in fact averages across the entire range of possible scores (“0.0” to “4.0”), we viewed the UMS Group scores as more representative of PowerStream’s position across each of these areas of competence. Furthermore, we attribute the wide range of scores within the PowerStream participants as indicative of a lack of familiarity with sound Asset Management principles, rather than a representation of different informed views.


Figure 2 – Summarized Results of Gap Analysis

Translating these 24 areas of Asset Management competencies into 5 categories (Organization Strategy, Management and People, Risk Management and Investment / Program Planning, Investment and Program Delivery Management, Performance Management, and Asset Information Management and Enabling Technology), PowerStream is predominantly in the “Development” stage of Asset Management Program implementation (i.e., the organization has a good understanding of Asset Management, has decided how the elements of Asset Management will be applied, and has made progress in implementation).

Figure 3 – Overall Assessment


Findings and Recommendations

During the course of the evaluation, UMS Group was favorably impressed with many facets of PowerStream’s approach to Asset Management. Recognizing that most successful transformation plans leverage existing strengths, we deem it appropriate to first highlight the areas where PowerStream has already instituted, or is well on the way to instituting, effective Asset Management practices and approaches, and then highlight highly leverageable opportunities to maintain momentum towards establishing excellence:

PowerStream has effectively applied the Asset Condition Assessment (ACA) methodology developed by Kinectrics Inc. and BIS Consulting, LLC across 11 major asset classes (TS Transformer, MS Transformer, Circuit Breaker, 230kV Switch, MS Primary Switch, Station Capacitor, Station Reactor, Distribution Transformer, Distrbution Switchgear, Wood Pole and Distribution UG Primary Cable), establishing optimum asset replacement cycles as an input to its capital investment budgeting process. The approach presented in performing asset evaluations and developing overall programs is in line with industry leading practices. We would recommend continued emphasis in the following areas for achieving alignment among all of the key elements of an effective asset lifecycle plan for PowerStream’s most critical assets:

‒ Information management practices (including the collection, maintenance and accuracy of asset condition data / information to assist in developing health indices, probabilistic failure rates, criticality of components, asset risks, and correlation of projected asset failures and required replacement capital);

‒ Establishing the necessary IT platforms to manage the data and information required to perform asset evaluations;

‒ Tightening up the connection between the ACAs and the current capital investment portfolio optimization process; and,

‒ Extending this philosophy to inspection and maintenance program optimization (reflecting cost-benefit trade-offs between interval-based, condition-based, and reliability centered maintenance (RCM) with “run-to-failure” as an asset-specific, proactive strategy rather than an outcome of broader funding decisions).

PowerStream has a core knowledge base with the experience, competencies and skills necessary to effect and sustain this transformation. The challenge involves properly leveraging this capability across the organization in a way that captures / integrates the embedded subject matter expertise as effectively and efficiently as possible. This will require a number of actions:

‒ Development / communication of a comprehensive Asset Management Strategy and Plan that ties many of the ongoing intiatives into a total package and clearly illustrates how this strategy is an enabler to other corporate initiatives (e.g. “Journey to Excellence”).

‒ Continued clarity around the roles of Asset Owner, Asset Manager and Service Provider, particularly regarding: the establishment of, and management to, asset risk tolerance thresholds; distinguishing between maintenance program development and the actual conduct of maintenance work (similarly the establishment of design and construction standards vs. actual performance of capital projects); and the integration of asset-by-asset criticality, condition and risk information into the investment and program funding process.


Key elements of Financial and Project / Program Planning and Execution appear to be in place. Possible enhancements to consider include:

‒ Consistent with the statements regarding asset condition and performance based data / information, standardize Project and Program monitoring and reporting across PowerStream. Also, consider extending beyond standard progress and budget performance monitoring to validate the capture of value or elimination of risk presented in the various business cases.

‒ With respect to performance monitoring, challenge existing KPIs regarding line-of-sight linkage between individual performance, investment and program delivery, and corporate strategy, ensuring full transparency across the business.

‒ It appears that PowerStream applies a holistic approach in evaluating lifecycle cost when making asset procurement decisions. As asset lifecycle optimization practices undergo continued refinement, there may be a need to adjust various purchasing evaluation factors.

‒ In light of the dynamics between O&M spending and Capital investment dollars, PowerStream may find opportunity to properly recategorize future spending / investment decisions (e.g. Extension of ROW clearance, Danger Tree removal, linkage of inspection activity to ultimate replacement and definition of units of property).

‒ Consistent with the recommendation to extend the philosophy and approach used for developing ACAs for critical assets, the current Capital Portfolio Optimization tool could be applied to O&M programs (which will require a more comprehensive programmatic approach to O&M spending and linkage to anticipated value capture and risk mitigation).

Prospects for Success

UMS Group maintains a highly optimistic view of PowerStream’s potential to achieve industry leading status in its Asset Management implementation:

We encountered no resistance to the notion of value to be derived from this program, particularly once it was presented in the context of PowerStream’s Journey to Excellence as an enabler and as a more “routinized” approach to common sense practices for optimizing the performance and investment / spending levels on assets.

PowerStream’s leaders understand the differences inherent to the amalgamation of a number of utilities and remain focused on gaining philosophical and programmatic alignment, rather than tactical compliance (e.g. Differing approaches between North and South in implementing cyclic circuit inspection programs).

As is usually the case, the Stations and Protection / Controls areas appear to have progressed further than Lines in implementing effective Asset Management processes. This assessment seems to be driven primarily by the implementation of CASCADE (combined with the noted shortcomings of the accuracy and effectiveness of GIS for Lines) and the inherent advantage of less-distributive assets. That said, the applicable activity level related to Lines is consistent with the challenge of getting a better handle on data / information management and integrating asset health and condition information into the various investment and program planning processes.


Those charged with implementing this transformation understand the importance of coordinating their requirements with the Corporate IT Strategy, and are implementing measures to facilitate the proper integration of their requirements into this plan.

The following discussion more explicitly outlines our approach, specific aspects of the evaluation, and 17 initiatives proposed for consideration in PowerStream’s Asset Management Transformation Plan.


Project Approach

Consistent with Figure 4 (below), UMS Group viewed this effort in 4 distinct phases: initially confirming alignment around the process and expectations related to the effort, then conducting on site interviews and surveys across the entire enterprise to discern current state and any practical constraints to continuous improvement, performing a gap analysis to the practices established in PAS 55, and ultimately submitting our findings for Executive Management review and subsequent integration with PowerStream’s Operational Plan.

Figure 4 – Overall Approach

Upon review of relevant PowerStream Asset Management related documentation and 39 targeted group and / or individual interviews (refer to Appendix A for a listing of interviews / meetings conducted over a 2-week period), we facilitated a self-evaluation and conducted our own evaluation of PowerStream’s standing across 7 domains and 24 areas of competence (illustrated in Figure 2), and then translated these areas of competence into the UMS Group evaluation framework (Figure 5):


Figure 5 – UMS Group Analytical Framework

PAS 55 Areas of Competence UMS Group Evaluation Framework

Definition

4.1 4.2 4.3.1 4.3.2 4.4.1 4.4.3 4.4.4

General Requirements Asset Management Policy Asset Management Strategy Asset Management Objectives Structure, Authority and Responsibilities Training, Awareness and Competence Consultation, Participation and Communication

Organization Strategy, Management and People

Extent to which the Asset Management (AM) system aligns with PAS-55 standard requirements. Specifically, we reviewed the definition and distinction between the Asset Owner, Asset Manager and Service Provider functions and evaluated consistency between overall strategies, the underlying philosophy in managing the assets, and the deployment of personnel in capturing value of installed assets.

4.3.3 4.3.4 4.4.7 4.4.8

Asset Management Plans Contingency Planning Risk Management Legal and Other Requirements

Risk Management and Investment / Program Planning

Consistency of risk analysis methodology and investment/program planning with AM policy and corporate / business area strategy; Determined the extent to which investments/programs are identified, prioritized and optimized based on overall value, resources, and risk; and AM plans, processes and procedures are factored into the planning and execution of capital projects and O&M programs.

4.5.1 4.5.2 4.4.2

Life Cycle Activities Tools, Facilities and Equipment Outsourcing of Asset Management Activities

Investment / Program Delivery Management

Methods and processes that reflect the alignment of life cycle activities with the overall asset strategy. This area also includes project and resource management and performance assessment / auditing/ condition monitoring.

4.4.9 4.6.1 4.6.2 4.6.3 4.6.4 4.6.5 4.7

Management of Change Performance and Conditioning Monitoring Investigation of Asset-Related Failures, Incidents and Non-Conformance Evaluation of Compliance Audit Improvement Actions Management Review

Performance Management Extent to which the organization has embedded the skills and competencies necessary to successfully effect an Asset Management transformation. It includes evaluating if a performance management framework is in place so that the organization’s strategy, objectives, and KPI’s / measures are aligned, ensuring that the expected performance of both assets and resources (internal and external) support those stated strategies and objectives.

4.4.5 4.4.6 4.6.6

Asset Management System Documentation Information Management Records

Asset Information Management and Enabling Technologies

Extent to which the installed AM Information Management architecture and processes are adequate to ensure availability of accurate asset performance information in support of asset-related decisions.

The individual scores were evaluated, applying the following Asset Management Maturity Scale, differentiating between PowerStream’s self-evaluation and that performed by UMS Group.

Figure 6 – Asset Management Maturity Scale


All gaps (scores less than maturity level 3) were reviewed in the context of insights gleaned during the interviews and UMS Group’s view of the more cost-effective and sustainable Asset Management practices to arrive at a list of 17 proposed initiatives for Executive Management review and disposition. Estimated costs, our view of relative urgency and difficulty (refer to Figure 7 for categorization criteria regarding urgency and difficulty), and an overall Asset Management Transformation Plan spanning years 2013 and 2014 was provided to facilitate this review.

Figure 7 – Urgency and Difficulty Categorization Criteria


Gap Analysis

The tabulated scores, summarized below in Figure 8, provided the grounding for an overall UMS Group assessment of 2.13 (indicative of an organization well along in the development of an Asset Management process with some areas approaching Maturity Level 3 – Competence defined in Figure 6):

Figure 8 – Tabulated Scores

In general, the PowerStream average scores (depicted in Figure 8) were lower than those provided by UMS Group. That said, in virtually every category, the range of PowerStream’s score ran the full gamut (from “0.0” to “4.0”), more indicative of a disparity in the organization’s understanding of the principles and practices that underlie Asset Management than a differing view of its effectiveness in implementing the overall program.

Note that our evaluation indicates that PowerStream is at or approaching Maturity Level 3 – Competence in 6 categories, namely:

Asset Management Plans Contingency Planning Risk Management Life Cycle Activities Investigation of Asset-Related Failures, Incidents and Non-conformance Audit

And, these are all areas that independent of PowerStream’s ambition for PAS 55 certification, warrant serious consideration in capturing the value attributed to Asset Management. Consistent with previous discussions, we view PAS 55 as a valid reference point for assessing competence in a specific area, but are not strong advocates for full certification. A lower score in any one area does not necessarily imply a need to establish a gap closing initiative or strategy. Rather, it poses a question that should be considered in light of a business case that weighs cost (in terms of investment / spending levels and difficulty), resources, and anticipated benefit (impact). The 17 recommendations presented in the following section reflect UMS Group’s view of where PowerStream can capture the true value of an Asset Management program, applying prudence in weighing benefit and costs to implement and maintain the related practices and systems necessary to capture said value.


Recommended Initiatives and Actions

Adopting the framework defined in Figure 5 and the categorization criteria presented as Figure 7, UMS Group proposes that PowerStream consider the following 17 initiatives for inclusion in its overall Asset Management Transformation Plan. Overall ratings (both PowerStream’s self-assessment and that performed by UMS Group) for each of the 5 evaluation categories are provided to establish context for the proposed initiatives.

Organization Strategy, Management and People

Figure 9 – Organization Strategy, Management and People Ratings

UMS Group proposes 3 initiatives (at a total cost of $60,000) that, if addressed, will provide the strategic framework to tie together many of the programs and practices already in place (e.g., Asset Condition Assessments, Capital Portfolio Optimization, CASCADE Implementation, and Focus on Condition and Reliability Centered Maintenance) and more effectively define the focus of key individuals with respect to asset risks and project execution.

Figure 10 – Organization Strategy, Management and People Recommendations

Figure 11 presents an outline of the contents of a typical Asset Strategy and Vision, more to promote thought and discussion than to prescribe a specific format.


Figure 11 – Contents of Asset Management Strategy and Vision

And with respect to clarifying the roles of Asset Owner, Asset Manager, and Service Provider, key roles requiring clarification include asset risk management, decision making vs. project / program execution, and overall performance management. Figure 12 illustrates a high level conceptual view of these functions:

Figure 12 – Asset Management Roles and Responsibilities

Differentiation among these functions is further amplified by Figure 13 which provides a profile of typical activities across 6 common areas of focus (not necessarily all-inclusive). The use of the term “function” in the column headings is intentional. Though there are certainly organizational implications in defining these roles, there is no one organizational structure.


Depending on the size and complexity of the system, organization designs range from separate and distinct Asset Management Groups to the assignment of tasks within an existing organization structure. The key is to ensure that all bases are covered (scope of specific activities), there is clarity regarding roles and responsibilities (independent of organization structure), and there exists total transparency around the issues of risk, value and asset performance management. PowerStream is well along in its understanding of these distinctions with varying degrees of implementation based on specific focus area.

Figure 13 – Functional Breakdown of Key Activities

Focus Area Asset Owner Function Asset Manager Function Service Provider Function

Performance Management

Establish capital and O&M budgets and operational performance requirements (Availability, Reliability, etc.)

Establish the capital investment and O&M spending plans to maintain or improve upon performance levels (as applicable)

Finalize the scope of Asset Management (critical asset classes)

Conduct root cause analyses in the event of a reported failure

Operate, replace, refurbish and maintain assets within pre-established schedules and budgets (including design and procurement support)

Provide input to the investment portfolio and O&M spending program planning process (including input as to what comprises critical asset classes)

Report all asset performance anomalies and support any subsequent root cause analyses

Risk Management Establish Risk Tolerances Final authority on arbitrating value

and risk tradeoffs in the finalization of the annual investment and spending plans

Translate Risk Tolerance Criteria into a framework to drive capital investment portfolio and maintenance program optimization

Drive the performance of asset condition assessments (ACA) to facilitate the integration of condition, criticality and failure rate information into the capital investment and O&M program planning process

Enter proposed capital investments for scoring risk of deferral

Maintain operating and maintenance history of critical assets to provide “real time” view of asset condition

Continually update Asset Management on emerging risks /unresolved issues based on the condition and performance of critical assets

Specify technical requirements for critical assets with due regard to operational requirements and approved risk threshold

Capital Portfolio Optimization

Approve Business Value Framework (submitted by Asset Manager) and assign relative importance of strategic objectives and measures

Approve annual and long-range capital investment portfolio

Define framework to score, rank and select proposed capital investments

Analyze proposed investments and spending programs and present series of options (with various value and risk scenarios) for approval

Staff and execute capital investments (projects) within budget and on schedule (Design, Installation, Testing and Turnover)

Maintenance Program Optimization

Approve overall Maintenance Plan and related risk profile

Develop asset-specific maintenance plans (addressing the application of interval-based and reliability / condition-based maintenance and “run-to-failure” approaches as well as the applicability and scope of specific inspection and testing programs)

Staff and implement O&M programs within prescribed performance parameters

Record results of maintenance activities in Asset Registers

Provide technical input into the develop of maintenance plans

Resource and Contracting Strategy

Approve overall approach to staffing capital investment and O&M program activities

Approve proposed listings of core and non-core business activities and preferred approach to their execution

Lead negotiations in any proposed staffing strategy that might impact current contracts

Define core and non-core business activities (strategic staffing implications)

Propose staffing strategies that offer maximum flexibility within the constraints of existing contracts

Establish contracts for staff supplementation and long-term alliances

Determine and execute the best option (in-house or external contracting) for providing a specific service / activity

Provide feedback on performance of service for both in-house and outsourced efforts (quality of work, schedule and budget compliance, and responsiveness)

Information Management

Establish strategic framework for enterprise-wide Information Management

Approve budgets and schedules for specific IT related projects

Specify information requirements for asset performance monitoring (from Executive and External Stakeholder perspectives)

Propose IT platforms for asset register and asset performance monitoring / tracking

Define asset related data and information capture requirements

Define asset performance reporting requirements and associated data / information collection frameworks

Provide asset performance, maintenance, operating history, and condition information through properly completed work orders and inspection / testing checklists


Risk Management and Investment / Program Planning

Figure 14 – Risk Management and Investment / Program Planning Ratings

UMS Group recommends 6 initiatives (at a total cost ranging between $350,000 and $500,000) to ensure that PowerStream has a comprehensive view of its asset risk profile, capital investment portfolio and maintenance spending plans and procurement / accounting strategies that adopt total lifecycle management principles.

Figure 15 – Risk Management and Investment / Program Planning Recommendations

PowerStream has established many of the foundational elements required to ensure optimum deployment of available capital investment and O&M spending funds:

Asset Condition Assessments (ACA) reflect industry leading practices in integrating asset condition, criticality and health indexing / failure history into well-grounded capital replacement and refurbishment strategies.

Capital Investment Portfolio Optimization factors both value (a proposed investment’s contribution to strategy) and risk of deferment.

Asset Registers and supporting IT infrastructure (CASCADE and GIS) are in various stages of maturity in terms of completeness and accuracy, but PowerStream has a clear vision and approach to tracking asset performance in support of these planning decisions.

Procurement appears aligned to be conceptually aligned with Operations in factoring in total lifecycle costs in its purchasing decisions.


Consistent with our overall view that PowerStream has many of the basic elements in place or are well along in development, but lacks an overall strategy to effectively capture inherent synergies, PowerStream needs to ensure completeness in program scope, and communicate / position the program in the context of its “Journey to Excellence.” Through the development and communication of a comprehensive Grid Modernization Strategy, PowerStream can account for the multiple and seemingly competing priorities placed upon today’s electric utility industry, most notably:

Infrastructure Refurbishment and Replacement Reliability Performance Mandates Smart Grid Technologies (ranging from Smart Meters to Automation) Added Capacity Requirements Environmental Stewardship

And, in so doing, will provide a more complete picture with respect to its asset risk profile, and investment and program value capture. Again, Figure 16 is provided to prompt thought and discussion, not necessarily to prescribe format or even a specific approach. However, this framework has been successfully deployed in supporting regulatory discussions and has served as an effective platform for capturing and communicating the outputs of the aforementioned foundational elements of effective Asset Management.

Figure 16 – Strategic Framework

Collateral benefits of this approach include the ability to:

Maintain a holistic view, yet disaggregate the driving forces and constraints to enable the tailoring of presentations to a broad and varied constituency;

Allow for the integration of a broader-view grid strategy with the current operational planning process;

Capture and translate all technical benefits in terms easily understood by all parties; Provide total transparency in the benefits, costs, sequences and assumptions to

enable ongoing refinement and support during implementation; and, Continually refine the plan amidst a dynamically changing environment (e.g.

technology, budget constraints and ever expanding list of competing priorities).


Investment / Program Delivery Management

Figure 17 – Investment / Program Delivery Management Ratings

With respect to Investment / Program Delivery Management, PowerStream should challenge its current resourcing strategy to ensure maximum flexibility in light of fluctuating level and focus of workload and recognize the opportunity presented by the aging workforce to effectively transition to lower staffing levels based on core vs. non-core business activity differentiation.

Figure 18 – Investment / Program Delivery Management Recommendations

There are 2 points to highlight in this portion of the discussion:

The composition of electric utility work forces and labor agreements oftentimes define the capital investment portfolio and O&M spending priorities rather than the requirements of the assets.

Figure 19 – Resource / Workload Paradigm


In order to make this shift, hard decisions around core vs. non-core work, base staffing levels, in-house vs. out-sourced skills and competencies need to be made and negotiated with appropriate internal and external stakeholders. The most daunting element of this challenge are the implicit requirements to reduce staffing levels and reassign work. The utilities are presented with a perishable opportunity to address this issue efficiently and humanely: the rapid acceleration of an aging workforce. Figure 20 summarizes the opportunity, risks, and recommendations around this emerging reality, suggesting the need for a well-conceived strategy working hand-in-hand with Corporate Human Resources and Labor Relations.

Figure 20 – Organizational Restructuring

Performance Management

Figure 21 – Performance Management Ratings

UMS Group recommends 2 initiatives (totaling less than $100,000) to improve transparency of value capture relative to capital investments and O&M spending programs, and ensure a closed loop between the completion / closeout of projects and programs and information required to operate an effective Asset Management Program.


Figure 22 – Performance Management Recommendations

The current Capital Investment Portfolio Optimization process addresses the right-hand portion of Strategy to Performance picture in Figure 23, optimizing the value-risk tradeoff within a constrained budget by linking investment decisions to overall strategy, a process that is well-established within PowerStream.

Figure 23 – Strategy and Performance Linkage

This recommendation addresses the left-hand side of the same picture, acknowledging the need to more explicitly link capital investment projects (and for that matter O&M spending programs) to a well-designed performance metric and KPI framework to (1) better anticipate future performance challenges (i.e.; establish a balance between leading and trailing indicators), and (2) validate that the value presented in respective business cases is in fact realized. Figure 24 illustrates an operational dashboard that can be tailored to achieve these objectives, driving line-of-sight between investments and programs and corporate strategy (a concept that can also be applied to individual performance management).


Figure 24 – Operational Dashboard

Asset Information Management and Enabling Technology

Figure 22 – Asset Information Management and Enabling Technology Ratings

Traditionally, the more costly portion of any Asset Management Transformation Plan, UMS Group recommends 5 initiatives (total costs well in excess of $1,000,000) to provide a comprehensive approach to asset inspection, maintenance, condition and performance monitoring, asset risk management, capital replacement vs. refurbishment decisions, and transparency to the full cycle of problem / issue identification to installation / repair and capture of anticipated value. The least expensive, yet most impactful initiative is ensuring complete alignment between the developing Asset Management Program and the emerging enterprise-wide Information Management Strategy. And prudence suggests the establishment of practices and processes and simple rudimentary IT support prior to engaging in enterprise-wide software purchasing decisions.


Figure 23 – Asset Information Management and Enabling Technology Recommendations

In implementing these initiatives, close coordination and alignment to an overall Corporate IT strategy is of paramount importance in ensuring the widest realization of benefit and maximum implementation and operating efficiency. The following discussion is again intended to promote thought and discussion, focused more on the implied concepts than specific attributes.

Key Features of an Asset Register

In determining the optimum IT platform for developing and maintaining an asset register, there are a number of factors to consider regarding its definition, function and related processes:

• An asset register is a unique listing of a company’s tangible assets that are required for day-to-day operations.

• Ranges in functionality from simple coded lists of assets to an integrated, relational database of assets and related information.

• Asset information may include technical specifications, geospatial information, vintage, cost, value, performance history, maintenance history, maintenance procedures, diagrams, pictures and instructional video clips.

• The asset register is the fundamental source of all network asset data and information. It is the original source of information and data used in all front office processes.

• The asset classification process is formalized to ensure that the groupings defined within the asset database can be cost justified and meet the requirements of all critical processes.

• The asset register is queried and updated directly through other systems, including work management, maintenance and operational scheduling, financial, technical, and other information systems.

• The asset register and performance reporting systems should share common data architecture to facilitate data sharing.

Figure 24 provides a representation of the type of information found in asset registers.


Figure 24 – Asset Register Contents

Key Features of an Asset Risk Register

Similar to the approach recommended in developing as asset register, there are a number of factors that need to be considered in identifying the optimum platform for an assert risk register:

• A risk register is a tool which acts as the central repository for all risks associated with the business and captures risk information from the “bottom up.”

• Any risk that cannot be completely eliminated should be recorded in the risk register. • Risk registers assist management in understanding the nature and extent of all

identified risks; the amount of risk that can be accepted; and methodology to control / reduce risk.

• Risk registers consist of a description of each risk (including its nature and magnitude), its impact (consequence) and probability of occurrence, any recommended activities to mitigate (and possibly eliminate) the risk, the most likely time frame for the projected exposure, the organization responsible for managing the risk, and an action plan to reduce each risk to an acceptable level.

• Asset risk registers can be focused on the entire enterprise or on specific business units.


Asset Management Transformation Plan Recognizing that the previously presented recommendations constitute UMS Group’s view of a reasonable approach to further improving the effectiveness of PowerStream’s Asset Management Program, the purpose of this section is two-fold:

Provide additional information and perspectives to facilitate PowerStream’s Executive Management review of the proposed recommendations, and

Assuming acceptance of UMS Group’s recommendations, present a time line for actual implementation

This should not be construed as direction or implied acceptance by PowerStream Management. Rather, it is provided merely to illustrate what is possible and when it could be achieved. Pragmatic considerations regarding the integration of these initiatives within current capital investment and O&M spending constraints and other competing priorities will need to be factored into the final plan; keeping in mind that steady realization of a well-conceived plan is preferred over a series of starts and stops associated with an overly ambitious plan.

Asset Management Transformation Plan Analyses

Figure 25 presents each initiative in a 2-dimensional plot to convey UMS Group’s view of relative urgency and cost, with the size of the bubble connoting difficulty to implement. This is intended to assist PowerStream Executive Management in assessing the viability and relative priority of each proposed recommendation.

Figure 25 – Categorization of Recommendations

In finalizing the list of recommendations, UMS Group remained attentive to its commitment to establish a reasonable plan (from both resource availability and financial perspectives), acknowledging the wisdom of selecting fewer initiatives able to be highly leveraged that can be


accommodated within current operational and financial constraints. Figure 26 illustrates this point as the vast majority (12 of 17) of the recommendations are less than $80,000, and 3 of the 4 that exceed $100,000 are IT related.

Figure 26 – Cost Profile of Recommendations

Asset Management Transformation Road Map

The following Asset Management Plan establishes time frames for each of the recommendations, time sequenced to reflect relative urgency and any interdependent relationships. The final plan will reflect those initiatives accepted by PowerStream Executive Management who will understandably refine the actual schedule to factor in any financial and operational constraints.


Figure 27 – Asset Management Transformation Road Map

Presented as an initial 2-year implementation time frame, the structure of the recommendations allows sufficient flexibility should resource or financial constraints drive a more extended schedule.


Appendix A: Listing of PowerStream Participants

As stated in the Executive Summary, 39 PowerStream employees (listed in Figure 28) participated in either individual interviews or meetings to provide their perspective regarding PowerStream’s comparative position with respect to PAS 55. We would be remiss if we did not acknowledge the outstanding level of cooperation (e.g. punctuality, accountability and candor) of all participants and support from all levels in the organizations, all key factors in allowing UMS Group to provide the preliminary report within such a compressed time frame.

Figure 28 – Listing of PowerStream Participants

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