PUTTING YOUR MONEY WHERE YOUR NEED IS: IMPLEMENTING AN ASSET MANAGEMENT-FOCUSED CIP

摘要

Integrating asset management concepts and tools into a utility’s capital planning processrnoften yields rapid and measurable cost savings and performance improvements. Criticalrnto an asset management-focused capital improvement program (CIP) is the developmentrnof a thorough “business case” approach to proposed projects, requiring project sponsorsrnto present a consistent level of information, document and analyze key issues, andrnsupport an objective evaluation of the justification, drivers, costs/benefits and priority ofrneach potential project.rnThis paper will describe the business case approach to capital prioritization that the Cityrnof Virginia Beach Department of Public Utilities (DPU) utilized in 2010 to kick off itsrnasset management program efforts. This business-oriented and financially-driven CIPrnplanning process focuses on project prioritization through the use of detailed businessrncase analysis and the utilization of cross-functional teams and committees to ensure arnbalanced perspective on capital planning and asset management issues necessary to drivernorganizational change.rnThe goal of this capital planning effort was to develop a best-in-class prioritizationrnprocess that ensures a rational and sustainable CIP while responding to the businessrnneeds of both the DPU and its key stakeholders. The outcome of the effort was a finalrnCIP document that included a validated and prioritized list of projects for the upcomingrnfiscal year incorporating growth, rehabilitation/renewal, and enhancement projects. Mostrnimportantly, the task concluded with a defined methodology and process through whichrnDPU can update its CIP on an ongoing basis using the tools, templates, and techniquesrnapplied throughout the project.rnOther key benefits of DPU’s formal and dynamic capital investment planning processrninclude:rn1. Greater understanding of the long-term service level and cost implications ofrncapital investment decisions, including triple-bottom-line impacts.rn2. Strengthened long-term financial decision making, enabling accurate financialrnprojections, and helping to ensure adequate funding and rate structures.rn3. Ensuring that planning, engineering, operations, maintenance, and financialrnperspectives are all considered.rn4. Fostering a culture of asset management throughout the organization.rn5. Creation of improved trust, understanding, and transparency with the public,rnelected officials, and stakeholders - strengthening the case for requiredrninvestments and resources.rnAs DPU has found, an integrated, asset management-focused capital planning process isrneffective because it builds business discipline, encourages analysis of options andrnalternative solutions, documents expected customer and environmental impacts, andrnensures alignment with strategic asset management goals.