Why your organisation needs ‘next practice’ asset management

By intouch * posted 23-11-2016 16:52


Under-resourced regional councils struggling with poor service delivery should adopt a ‘next practice’ asset management framework and collaborate with other councils, according to the authors of a new study.

The paper Regional Sustainable Development and Asset Management in Australia: The Way Forward recommends an innovative ‘next practice’ – as opposed to ‘best practice’ – approach to optimising regional asset service delivery.

“Next practice… goes beyond the best practice emphasis on engineering and financial arrangements in order to provide new generation services to the regional communities,” the authors write.

A collaboration between researchers from the University of Southern Queensland (USQ), Curtin University and Southern Cross University, the study explores existing and emerging issues associated with regional asset management. The researchers focus specifically on the regional road network, due to the asset’s high value and the vital role roads plays in regional communities.

The authors recognise that local governments in regional areas face a unique list of challenges to service delivery levels, including dispersed and remote assets, ageing infrastructure, resource scarcity, changing regional demographics, extremes of climate, and increasingly complex regulations.

Lead author Nateque Mahmood, a lecturer at USQ, says many regional areas are facing a declining rate-payer base; between 2001 and 2011, 131 Australian local government areas experienced population loss.

“A number of regional areas are experiencing population loss, so they have to depend on federal funding, which is becoming increasingly competitive,” Mahmood says.

“There are political impacts as well, because investing money in new infrastructure is always more favourable politically [than maintaining existing infrastructure]. We need to come out of this culture.”

The paper further outlines the challenges:

“In most cases, regional service providers rely on ad-hoc maintenance practices in response to public complaints, emergency situations and catastrophic failures that are not adequate to sustain healthy infrastructure. Moreover, changes in use and an inability to accurately predict future loads and service requirements have caused problems to the asset service providers in developing effective asset management plans,” the authors state.  

Because of these challenges, the study argues that a new framework for regional asset management is needed.

The researchers outline three key elements for achieving next practice asset management:

  • Innovative, whole-of-government regional asset management
  • The improvement of service delivery through inter-organisational coordination and collaboration
  • Information and communications technology-mediated decision support systems

As part of the move toward whole-of-government regional asset management and in the context of regional roads, the authors recommend that a Regional Road Network Group be created, where councils can share knowledge and solutions. Mahmood says this group would be supported by a technical committee (with involvement from Austroads and the state road authority), and a coordination committee. 

The coordination committee could convene regional group meetings by setting agendas, facilitating discussions and sharing information, as well as monitoring report on progress against specific objectives. The technical committee could provide access to service level templates, risk assessment formats and capital works evaluations.

“Then you can share the knowledge you gain through this network group,” Mahmood says. 

The second element, inter-organisational coordination and collaboration, could achieve economies of scale when it comes to procurement, Mahmood says. 

“A group of regional councils who share their borders with each other may call for a joint tender (for example, for condition assessment surveys for road assets) or can apply for a joint funding application to the federal or state government as part of the relational approach. This coming together of previously competing entities may help to save costs in documentation, advertising, and also attract better rates from the contractors as it lessens the transaction costs of contract monitoring,” the authors state. 

The third element of the framework – ICT-mediated decision support systems – would see councils in the Regional Road Network Group adopt a common data platform.

“By maintaining the same or similar asset management systems, the regional group can achieve the advantages of regional back-up knowledge (residual, community-centric history), savings on material purchases, and improved supplier services,” the report states.

Mahmood recognises the nature of the collaborative arrangement could create some challenging situations.

“There are challenges; councils who are part of the group will inevitably lose some control over decision-making,” he says. 

"The development and implementation of next practice infrastructure and asset management will require new approaches that bring together and harness the full capacity of a region. This will require an expanded skill set including: relationship management and dispersed leadership that encompass internal and external parties, win/win negotiation capabilities and social network analytics and  systems and processes that support these new modes."

A future study, expected to be released in the second half of 2017, will address these challenges, and investigate specific roles within the Regional Road Network Group. 

Read the full report here.