APC MANAGEMENT SERVICES PTY LTD

Capability Statement

Simplifying Strategic Asset Management

STRATEGIC ASSET MANAGEMENT

INTRODUCTION
PROVIDING YOUR BUSINESS STRATEGIC ASSET MANAGEMENT
APC Management Services Pty Ltd is a boutique consultancy business offering Strategic Asset Management consultancy service to both private and public sector clients. Based in Southern Queensland and operates throughout Australia. The Company is privately owned and managed by Adam Colrain. Adam has over 15 years experience in the fields of development management, construction project management, contract administration and asset management. Adam believes that the ongoing success of APC Management Services is achievable by maintaining high standards of performance and adopting an honest open approach with our clients. We will continue to strive to deliver quality project delivery services. At APC Management Services we believe in a hands on approach to the management of all projects. We will be directly involved in all facets of each project that the company is engaged to manage.

INTRODUCTION STRATEGIC ASSET MANAGEMENT LEVELS OF SERVICE DEMAND MANAGEMENT CONDITION ASSESSMENT RISK MANAGEMENT LIFECYCLE PLANNING PREDICTION MODELLING ASSET MANAGEMENT PLAN PRODUCTION STRATEGY DEVELOPMENT ASSET MANAGEMENT SYSTEM
GEOGRAPHICAL INFORMATION SYSTEM

STRATEGIC ASSET MANAGEMENT

Strategic Asset Management is critical to controlling the risk of failing to meet the required operational objectives of your assets. The move by enterprises to a lean resource base, combined with workforces becoming more mobile, makes it difficult for organisations to focus on implementing sustainable processes. We provide clients with independent and objective advice to ensure optimum asset management policies and practices are in place.

LEVELS OF SERVICE
Levels of Service provide the basis for the life cycle management strategies and works programmes. Levels of service are refined over a period of time to manage the expectation of customers. This requires a clear understanding of customer needs, expectations, preferences and their willingness to pay for any increase in the levels of service. Levels of Service are used to:

Inform customers of the proposed type and level of service to be offered Identify the costs and benefits of the services offered Enable customers to assess suitability, affordability and equity of the services offered Measure the effectiveness of the service Focus asset management strategies to deliver the agreed level of service.

There are two types of Levels of Service being: Community Expectation Levels of Services Technical Levels of Service The Community Expectation Levels of Service articulate to the community the service being provided. They deal with the what, when and where. The Technical Levels of Service is used internally to measure service delivery. They deal with the how. Both types of Levels of Service are supported by Intervention levels which identify the actions required to maintain the service delivery.

Intervention levels are then adopted to support the technical levels of service.

Simplifying Strategic Asset Management

STRATEGIC ASSET MANAGEMENT

DEMAND MANAGEMENT
The process of undertaking demand management is essential in managing issues being faced today as well as managing the impacts of changing demand into the future. The immediate threat of water shortages in Australia has been reduced by the introduction of education processes to curtail water consumption. The services provided in the future may not be the same as the services provided now as a result of changes in demand. It is only through understanding demand and taking action to manage demand will the asset manager be confident in their organisation's long term sustainability. The main drivers of demand for infrastructure are:

Population growth or decline Industrial growth Residential development Demographic changes Demand for increased services Environmental changes Climate change Market forces Strategic extensions to the network.

The asset manager needs to examine the impacts of the above drivers and translate them into impacts on the assets. Once these impacts have been determined, the strategies to manage the impacts can be identified and implemented to reduce the burden on infrastructure both now and in the future. Demand management strategies provide alternatives to the creation of new assets. Demand analysis examines ways of modifying customer behaviour to maximise asset utilisation and reduce the need for new assets .

CONDITION ASSESSMENTS
Condition assessments are used as a guide to the performance of infrastructure and to indicate the required treatment to improve the asset's condition and performance. Condition assessments can be either quantitative or qualitative. A quantitative approach allows a user to record a rating or number of ratings against the asset. This information is then used for identifying the timing of future works. A condition rating is usually assigned to one or more distress modes depending on the asset type. A qualitative approach provides a descriptive assessment of condition. In this instance a condition rating is not assigned to the asset. The description is used as a basis for identifying the type of work to be undertaken in the short term. The approach taken will be dependent on:

The importance of the asset The use of the information Available funding to undertake the assessment and Accessibility to the asset.

The condition of an asset is inherently linked to its remaining life and the probability of the asset failing. Hence the asset's condition can be used as an input into asset consumption, renewal programs and risk assessments.

Simplifying Strategic Asset Management

STRATEGIC ASSET MANAGEMENT

RISK MANAGEMENT
Any organisation implementing a risk framework should have as a minimum:

Risk Policy Risk Strategy Risk Procedures Risk Register Internal audit process to support the framework

The overall objectives of a formal risk management approach are to:

Outline the process by which an organisation will manage risk associated with its assets, so that all risks can be identified and evaluated in a consistent manner Identify operational and organisational risks at a broad level Allocate responsibility for managing risks to specific staff to improve accountability Prioritise the risks to identify the highest risks that should be addressed in the short to medium term.

Infrastructure risk can be driven by: The asset (e.g. structural failure or failure to deliver required level of service) The service the asset is expected to support (e.g. raw water quality), or Events (e.g. power outage, flooding) Event-based risks require separate consideration, because assets that are a low risk when considered individually may be part of a much higher risk if an event causes multiple failures. A common example occurs with multiple pumping facilities: the failure of each pump or station on its own may have an insignificant effect (due to duplication), but an event like a power outage could result in total system failure. Risk management criteria relating to assets include:

Financial risk direct costs Public health and safety Economic impact on users and businesses Environmental and legal compliance Network, asset and project performance Image and reputation.

The establishment of risk management criteria is one of the most important steps in the risk management process, as it sets the framework for consistent risk decision-making.

Simplifying Strategic Asset Management

STRATEGIC ASSET MANAGEMENT

LIFECYCLE PLANNING
The lifecycle process recognises the different functions undertaken during the life of an asset. Just as people have a lifecycle so to do assets. The functions that occur during this lifecycle are:

Create or Acquire the asset Operate and Maintain Monitor the condition and performance of the asset Analyse the portfolio Determine the works Review the need for the assets

At the heart of the lifecycle is the ever changing risk. As the assets age or the performance declines, the risk increases. Lifecycle planning relies on the understanding of the assets and their perfromance. How the assets perfrom e.g. failure history, service delivery, cost history, risk exposure, demand and others all influence future planning. As such the the asset manager needs to understand the impacts of those influence to be able to remove them. Lifecycle costing supports the planning function by tracking the costs associated with the assets with the view to unerstanding the relationship between operations, maintenance and capital expenditure. By understanding these relationships the asset manager can analyse identify and analyse the funding options.

PREDICTION MODELLING
Predictive Modeling is used to provide organisations with a view of their potential liabilities and sustainability into the future. Depreciation is not explicitly funded for, but is included in the annual balance sheet and contributes to the annual profit or loss calculation. Some of the key assumptions or constraints relevant to Prediction Modelling are:

All expenditure is stated in current dollar values, with no allowance made for inflation over the planning period All costs and financial projections are GST exclusive Operations and maintenance costs are generally shown to increase in proportion to the quantity of the asset. Renewal costs are based on the findings of the renewal strategies. The costs of risk mitigation are included in the Prediction Modeling, however the potential costs that could arise through exposure to risk are not. Replacement Cost, Depreciated Replacement Cost and Annual Depreciation are calculated for the 20-year period.

The Prediction Models are dependent on the above key assumptions. In accounting terms, the decline (or gain) in service potential is defined as the value of renewals less depreciation, and indicates the rate the asset is being consumed. Predictive Models need to be periodically updated as more accurate information comes to hand or when significant changes in assumptions occur. Some of the following events may result in a need to update PredictionModels:

Shortfall between projected and available funding Significant changes to the asset register Changes in risk profiles Changes arising from the consequences of a natural disaster

Simplifying Strategic Asset Management

STRATEGIC ASSET MANAGEMENT

ASSET MANAGEMENT PLAN PRODUCTION

APC Management Services assists clients by either writing the plans for them or training them to produce their own plans. Either approach is acceptable however, by training our clients to produce their own plans, we are providing the knowledge transfer and client ownership in their AM plans. To assist in the plan production we provide templates and training notes that our clients can use as support and reference material. Our AM Plans comply with the International Infrastructure Management Manual. In doing so we ensure the plans accommodate the following asset management elements: * Asset profile * Demand analysis * Levels of service * Lifecycle management and analysis * Risk management * Financial forecasting * Asset Management improvement program We produce plans for all asset groups including: * Water * Wastewater * Parks / Open Space * Facilities * Drainage * Roads * Bridges and Major Culverts * Public Artwork * Aerodromes and specialist facilities * Waste In producing the plans for our clients we keep close contact with the client so they understand the purpose of the plan and appreciate the effort required in producing them. We also provide our clients with the knowledge required to review the next version of the plans. Our logic is that if we can assist our clients to progress their capabilities it will allow us to undertake more challenging activities with them in the future.

STRATEGY DEVELOPMENT
The Asset Management Strategy is a key component of an organisation's planning process linking with the following: Community Plan, Corporate Plan, Asset Management Policy, Operational Plan, Planning Schemes and Asset Management Plans The objective of the Asset Management Strategy is to provide a direction for AM incorporating a structured set of actions aimed at enabling improved asset management in accordance with the corporate AM policy over a 3 to 5 year period. The result is clearly defined improvement actions addressing the gaps in current practices, prioritised over the alloted timeframe to be implemented and monitored. A whole of organisation approach is needed when developing the strategy as asset management consists of functions that are used across the business by various business units including planning, finance, infrastructure. Alignment to the community and corporate plans ensures the strategy and supporting improvements is based on the direction of the organisation as a whole rather than the direction of the Engineering Directorate.

Simplifying Strategic Asset Management

STRATEGIC ASSET MANAGEMENT

ASSET MANAGEMENT SYSTEM

If you currently operate an asset management system and require a review of the progress you have made with this system, then let us help you. We can:

Review your progress to date Examine the outputs you are achieving Identify potential improvements to make better use of the system Explore the potential interfaces with your other systems Identify gaps in personnel skill levels

If you do not have an asset management system and are considering purchasing a system, we can help guide you through the process. We can:

Provide advice on the steps to be taken Assist you in progressing through the steps Provide advice on the systems in the industry, their functionality and strengths and weaknesses Provide the documentation you need to support you through the review process

APC Management Services Pty Ltd in association with Assetic Pty Ltd can provide Strategic Asset Management (SAM) Cloud hosted service solution, which incorporates the core packages of myValuer and an upgrade option of myPredictor. Assetic hosts the solution and customer data, and provides stress free reporting on annual cycles for: 1. Asset valuations and AAS 116 reports for auditors. This also includes journal upload outputs. 2. Five year Capital expenditure plans for each asset. 3. Five year major maintenance plans for each asset. 4. 25 year financial models for Asset Management plans. 5. What if scenarios for annual budgeting and Long Term Financial Plans plus Asset Management Framework reporting. 6. Service level models. The Strategic Asset Management (SAM) Cloud includes core software packages of myValuer and myPredictor which sits on the assetic server. Further details of the SAM Cloud are attached and available at www.assetic.com or contact Mr. Ashay Prabhu on telephone 03 9026 055. For further details of the Assetic Pty Ltd Strategic Asset Management (SAM) Cloud refer to the attachments section of this document.

GEOGRAPHICAL INFORMATION SYSTEM

APC Management Services Pty Ltd has development a Geographical Information System to assist in asset data collection. Further details of the Geographical Information System to assist in asset data collection refer to the attachments section of this document.

Simplifying Strategic Asset Management

ATTACHMENTS

Simplifying Strategic Asset Management

APC MANAGEMENT SERVICES PTY LTD

ACN 154 233 780 ABN 68 154 233 780 PO BOX 898 WARWICK QLD 4370 Ph: 07 4667 0485 Fax: 07 Mob: 0419893303 Email: mail@apcms.net.au www.apcms.net.au

Simplifying Strategic Asset Management