Part 5: Effective improvements you could make

Asset management for public entities: Learning from local government examples.

Asset management is a large and potentially complex subject. With limited resources, it is important to prioritise which aspects to develop first. We have identified a series of the most effective improvements you could consider without needing a lot of additional resources.

Make it matter

Asset management must become part of the culture – "the way we do things around here". It is fundamental to planning effectively and it needs to be recognised as such. It is not something to be done only to comply with legislation. Leaders need to make sure they "buy in" to the process, the reason why it is important, and the value of its outputs. This is not costly. It is a change of mind-set.

  • Case study 5.1: Wanganui District Council – managing assets well is strategic to wider objectives
  • Case study 5.2: Hutt City Council – technical performance measures

Make it fit

An effective organisation needs to recognise that asset management is an integrated process – it cannot carry out elements of it in isolation. No one part should happen without the others, and no one part is intrinsically more important than the others. It is a multidisciplinary process that involves engineers, financial and corporate planners, and policy makers. They need to work together.

  • Case study 5.3: Dunedin City Council – co-ordinated approach to planning

Support it

Having a champion or someone to co-ordinate asset management can really help. Sometimes it can be better if this is not someone actively involved in managing the assets. They tend to be too busy managing day-to-day works. Their professional and technical skills are in short supply and are highly sought after. It is probably best for the co-ordinator to be someone with good co-ordination or project management skills.

When asset management is co-ordinated across the organisation:

  • all asset management plans fit with the organisation’s planning assumptions; and
  • asset management plans provide robust business information for the wider business planning process.

Case study 5.4: Palmerston North City Council – organisational structure

Make it easy

Managing the assets might be a complex, technical business, but writing the asset management plan itself does not have to be difficult. Good use of templates, guidance, clear standards, and keeping it concise all help to keep the task of writing a plan manageable.

  • Case study 5.5: Dunedin City Council – using templates and guidance material

Keep on top of your asset information

Good quality asset management relies on good quality asset information. However, asset information can be costly to gather and can quickly become out of date. Regular condition assessments are expensive, and many smaller organisations struggle with the cost of keeping asset information up to date. The key is to continually maintain the information, regularly updating it as new intelligence become available.

  • Case study 5.6: Wanganui District Council – structured approach to asset assessment
  • Case study 5.7: Wanganui District Council – structured approach to recording asset data

Make performance management real

Gathering performance data can seem like a time-consuming, bureaucratic exercise. It is a pointless waste of resources unless the resulting information is useful. It should:

  • provide managers with the information they need to make decisions; and/or
  • help guide and manage asset-related staff; and/or
  • provide information to the public and other stakeholders about the services they are getting.

Tracking performance over time puts it in context and presents a much richer picture than a single year's data in isolation. It shows trends so managers and the public alike can judge how good performance is locally and whether it is improving. Once that is known, decisions on what to do next are better informed.

  • Case study 5.8: Dunedin City Council – effective performance management
  • Case study 5.9: Hutt City Council – monitoring levels of service

Use it to make more informed budgetary choices

The outputs of asset management should drive the budget. The budget should not drive asset management practice. If it does, backlogs of maintenance and renewals, sub-optimal solutions, short-term thinking, and risk often result.

Manage risk but do not over-complicate

Using a consistent risk management framework across the whole organisation is helpful. Individual asset managers do not have time to develop their own approaches, and if they do, they are likely to be inconsistent. Such inconsistency will make it impossible to compare risks across services and identify the highest priorities to manage corporately.

Do not over-complicate risk identification and the assessment of likelihood and impact. A workshop of staff from different functions is often a good starting point.

  • Case study 5.10: Rotorua District Council – linking risk management and levels of service

Manage demand

Considering factors other than just demographics will significantly improve the assessment of how changes in demand will affect the assets. Assumptions should be consistent across the organisation. Planning needs to consider a range of demand management options. Sometimes you can save investing in further assets and incurring the ongoing costs of maintaining them.