Managing Assets vs Asset Management 2019 Project Management

Managing Assets vs. Asset Management 2019 Project Management Conference Steve Wyton, P. Eng. , MBA, FIAM Manager, Corporate Project & Asset Management 1

Managing Assets versus Asset Management The Goal of Asset Management: To provide a systematic, holistic, cost effective and integrated approach to planning and the management of assets to achieve agreed upon service levels with acceptable risk levels and at the lowest lifecycle costs. Page 2

The ISO 55000 Framework Page 3

A SAMP specifies the following: • How organizational objectives are to be converted into asset management objectives, • The approach for developing asset management plans (AMPs), and • The role of the asset management system in supporting achievement of the asset management objectives

Calgary’s Asset Management Policy & Strategy • Further defines asset management and The City of Calgary’s guiding principles: • Aligns the corporation to ISO 55000 (international asset management standard) • Identifies the need for the asset management business system and governance • Identifies the “plan-do-check-act” cycle and key documents/principles: • Asset Management Plans, Infrastructure Investment Plans, Infrastructure Status Report, corrective action, etc. • Legitimizes the City’s asset management strategy and guidelines: • Level of Service Framework, Infrastructure Risk Management Framework, Infrastructure Investment Planning guidelines, Infrastructure Investment Strategy (Infrastructure Calgary) Page 5

The Asset Management Plan - Simplified 1. 2. 3. 4. 5. 6. 7. 8. 9. EXECUTIVE SUMMARY a. SERVICE & INFRASTRUCTURE STATUS INTRODUCTION & BACKGROUND LEVELS OF SERVICE (LOS) DEMAND MANAGEMENT (CURRENT & FUTURE) ASSET LIFECYCLE PLANS a. SERVICE & ASSET RISK b. OPERATIONS & MAINTENANCE c. RENEWAL & DISPOSAL FINANCIAL & FUNDING FORECASTS ASSET MANAGEMENT PRACTICES Cost PLAN IMPROVEMENT & MONITORING APPENDICES Risk Level Of Service Page 6

Level of Service (LOS) and Integrated Service Planning – Calgary Fire Results Based Accountability (RBA) Corporate LOS Customer LOS Community LOS (how is the community better off) Homeowner Insurance Affordability Impact of fire minimized New Fire Hall A Community Safety and Well Being 100% Fire Response within X minutes Min. X km to any community from firehall 100% reliability in fire fleet A great place to make a living, a great place to make a life Efficient, Reliable, Affordable Transportation Time to clear snow and ice 24 hour fire staff availability Perception of public safety Existing Fire Hall B Roof Asset LOS (CAPEX) Operational LOS (OPEX) *for illustrative purpose only Page 7

Asset Management and Infrastructure Investment Planning S e r v i c e Key Touch Points for Council P l a n n i n g S e r v i c e Citizen Priorities The City’s Strategic Plan Principles Council Directives Capital Infrastructure Investment Principles Approve Service Plans and budget 2019 -2022 E x e c u t i o n Approve mid cycle & annual adjustments Receive Infrastructure Status Report for Information Capital Investment Plan Infrastructure Calgary (Enterprise Management) Capital Investment Process Key Activities Investment Need Investment Planning Community service need Inform service planning Identify and mitigate risk Create business cases within common repository Evaluate service needs & costs Build Infrastructure Investment Plans Investment Optimization Prioritize & coordinate investments Allocate funding according to capacity Recommend capital investments by service Performance Monitoring and Reporting Risk Management Investment Delivery Investment Results Execute capital investments to support service delivery Monitor & report on investments & risks Continuous improvement through best practices Evaluate & adjust to maximize value

Case Study – Calgary Housing Company 250+ Properties, 10, 000 units, 25, 000 Calgarians, CRV = $1. 400 Billion

CHC’s Asset Management Strategy 2015 -16 Est. AM Policy, SAMP, AMP 2017 -18 Building Condition Assessments (BCAs) for CHC and City Portfolios Obtained $37 m over 4 years for both portfolios 2019 -20 SAMP and AMP refresh Negotiate with Province and City on AMPs Startup Real Estate Asset Portfolio Strategy Function

Adoption of PM Practices Calgary’s Corporate Project Management Framework (CPMF)

The Future of Infrastructure Management • Strengthen service and risk management capabilities; • Improve asset data availability and accuracy; • Citizen engagement on service levels, value and integration across service lines; • Start to consider other means of delivering service, including nonasset based solutions; • Consider asset divestiture or service elimination; • Link to resiliency, energy management, climate change; etc. • Develop practices on measuring benefits realization and adjust LOS/risk/$.

What’s the Value? n n n Shell (oil platforms and export pipelines) n Production uptime increased by 17% over 4 years n Simultaneous opex savings over $250 million (50%) n Safety and integrity indices improved Scottish Water: n Reduced opex by 40% (4 years), exceeded service targets n Delivered capital program for $1 billion less City of Calgary n AM reporting resulted in $3. 3 billion contribution from provincial government and justified increase capex for maintenance of $234 million (50%) n Prioritized $2 billion of potential corporate investment and deferred $1. 4 b n Efficiency gains and capital deferrals in most operating business units, citizen engagement on service levels.

Canadian Initiatives and Resources • Municipal Asset Management Program: Federation of Canadian Municipalities ($50 million) • Ontario Municipal Asset Management Legislation, Jan 1 2018 • Canadian Network of Asset Managers: • www. cnam. ca • National Water / Wastewater Benchmarking Initiative: • http: //www. nationalbenchmarking. ca/public/consulting/index. htm • Infra. Guide: • http: //fcm. ca/home/programs/past-programs/infraguide. htm • National & Provincial Asset Management Working Groups: • Alberta: https: //assetmanagementab. ca/ • British Columbia: http: //www. assetmanagementbc. ca/ • PSAB 3150 • Canadian Infrastructure Reportcard • CIRC: canadainfrastructure. ca

Thank You! Steve Wyton, P. Eng. , MBA, FIAM Manager, Corp. Project & Asset Management The City of Calgary steve. wyton@calgary. ca (403) 268 -5746