Docstoc

7 Risk based asset management in capital works delivery - Vito

Document Sample
7 Risk based asset management in capital works delivery - Vito Powered By Docstoc
					Risk Based Asset Management 
   in Capital Works Delivery
 Vito Albicini
 Former Director Infrastructure Services

 Bill Sharpe
 Manager Sustainable Asset Management
 Yarra City Council
A Common Story
          A Common Story
• Redevelopment Project funded in 2010 for 
  $200,000 to accommodate New Tenant. 
  Project was to be completed by February 2011

• 2012, Project on hold and not complete

• Project cost now $400,000 due to poor 
  scoping and planning.

• Project target completion date June 2012

• Tenant not happy

• Common story for Councils?

• What do we do to stop this?
                    Key Messages
• Poor Project Planning results in poor project 
  delivery and unsatisfied customers.

• Project risks need to be understood and managed.

• Sound Capital Works Planning considers the ;
   –   Capacity to deliver projects, 
   –   Life cycle cost of the project, 
   –   Environmental and social benefits 
   –   Quality and cost
   –   Amount of stakeholder involvement, and 
   –   Councillor and Community expectations.

• Project Implementation Plans are a tool to support 
  good planning and delivery of projects.

• Project Monitoring is also needed to ensure risks 
  are managed and projects are delivered.
    Corporate Risk 

Failure to appropriately 
manage and control capital 
works leads to uncontrolled 
and inappropriate 
expenditure resulting in 
financial and reputational 
loss.
What are Project Planning Risks?
• Poor planning with limited renewal and 
  replacement expenditure
• Conflict with the long term financial plan
• Poor prioritisation of works in Capital Works 
  Program
• Political influence on the priority of discretionary 
  works
• Poor project scope, understanding of project 
  budget and project programming
• Lack of understanding financial burden to Council 
  – Life Cycle Costing
• Not understanding environmental, social and 
  compliance (Town Planning) implications
What are Project Delivery Risks?
• Insufficient Project Management Skills across 
  Organisation
• Poor project management principles, processes 
  and systems to manage projects
• Lack of clarity of roles, responsibility and 
  governance structure to deliver projects – Project 
  Manager / Project Sponsor
• Lack of appropriate consultation with stakeholders
• No centralised electronic capital works 
  programming, recording and tracking system
Risk Control Measures

 • Asset Management Policy 2011
 • Capital Works Planning
    – Forecaster electronic capital works programming and
      management system
    – 30 Year Projected Capital Expenditure reporting
      process
    – Project Implementation Plans
 • Capital Works Monitoring
    – CAPMON, Executive CAPMON & PCG
 • Sustainable Infrastructure Network (SIN)
 • Project Management Principals and monitoring 
   systems
 • Responsibilities clear between PM and PS
 • Staff  professional and experienced
Capital Works 
  Planning
Capital Works Planning Parameters
•   The Council Plan, the long term financial plan (LTFP) and 
    the relevant Asset Management Plan (AMP) are the core 
    considerations for proposing capital programs; 

•   Projects are sorted into renewals, upgrades, new or 
    compliance projects, initial priority ranking is provided by 
    the Project Sponsor;

•   Projects submitted for consideration shall be given a 
    priority if they are derived from a Strategic Plan, AMP, 
    Master Plan, UDF (and the like) or from a specific Council 
    or Executive resolution;
 

•    Projects to be submitted after integrated discussions
    across asset classes has occurred to encourage
    optimum use of resources, outputs and Project
    Implementation Plans developed ;
Capital Works Planning Parameters
•   Projects over $250k will be planned to be delivered over
    a three year period. The typical delivery model will be:-
     – Year 1 -Concept planning, consultation & sign off of
        project brief;
     – Year 2 - Detailed design and obtaining permits;
     – Year 3+ - Construction and defects liability
        monitoring.

•   Discussions and sign off between the Project Sponsor, 
    (Service Manager), and Project Manager is required in the 
    development of all projects. For renewal projects Asset 
    Manager and Service Manager require sign off. For new 
    and upgrade projects Service Manager requires sign off  
    from  Asset Manager and Project Manager; and 

•   Projects without some level of mature planning will not
    progress. For example projects that are poorly scoped,
    or lack consultation will not be supported
Capital Works Planning 

•   PRE PLANNING Distribution of Adopted 10 Capital Works Program 
    for review by Project Sponsors and Project Managers. (AUG)



•   STEP 1: INITIATION MEETING (Sept)

•   STEP 2: PREPARING PRIORITY LISTS FOR A PROGRAM (Sept – 
    Mid Oct.)
              Assets Managers - Renewals
              Service Managers - Upgrades and New Works

•   STEP 3: DEVELOP DRAFT CAPITAL WORKS PROGRAM (Late 
    Oct)
             Capital Works Planner

•   STEP 4: REVIEW OF DRAFT CAPITAL WORKS PROGRAM (Nov)
             SIN and Executive Team
 
Capital Works Planning 
•   STEP 5: DECEMBER WORKSHOP WITH COUNCILLORS:
             Seek Council input in reviewing 5 year Capital Works
        and proposed New / Upgrade projects for Year 1

•   STEP 6: COMPLETION OF PROJECT IMPLEMENTATION
    PLANS FOR DISCRETIONARY UPGRADES AND NEW
    PROJECTS SELECTED BY COUNCIL. (Dec – Jan)
    Service Managers and Project Managers

•   STEP 7: SECOND REVIEW OF DRAFT CAPITAL WORKS        PROGRAM 
    (Feb)
    Capital Works Planner and presented to SIN and Executive

•   STEP 8: COUNCIL BRIEFING ON BUDGET (mid Feb.) – REFINEMENT OF 
    YEAR 1 BUDGET AND WORKS

•   STEP 9: ADOPTION OF DRAFT CAPITAL WORKS PROGRAM (March – 
    April)

•   STEP 10: FINALISATION OF THE CAPITAL WORKS PROGRAM  (June)
            Step 6
COMPLETION OF PROJECT IMPLEMENTATION
PLANS FOR DISCRETIONARY UPGRADES AND
       NEW PROJECTS. (Dec – Jan)
Project Implementation Plans 
  – Roles and Responsibilities, establish Project Working 
    Team and Project Control Group
  – Project Brief / Scope
  – Project Objectives / Outcomes
  – Project Assumptions
  – Environmental Issues to be considered
  – Social Implications to be considered
  – Project Risks
  – Project Constraints
  – Details of Other Income Sources
  – Detail of Planning / Approval Requirements 
    (Permits/Required Approvals) 
  – Community Engagement (Consultation) Process
Project Implementation Plans

  – Key Stakeholders
  – What ESD measures / Sustainability Initiatives are 
    included in this project
  – Social Benefit Initiatives 
  – Related Projects/Integration of Other Projects
  – Major Tasks – Responsibility, Timing & Costs
  – Life Cycle Cost / NPV / Annual Average Service Cost / 
    Operational Costs – (New / Upgrades)
  – Implementation Plan (How will project be delivered e.g. 
    traditional, single contract, fast track, design & construct 
    etc.)
  – Procurement Plan (What types of contracts packages 
    are proposed?)
  – Project Control (How the project will be monitored and 
    managed?)
Capital Works Planning 
Key Benefits:
  • Asset Renewal funding meets 20 year Asset Management
    Plans
  • Legal / Compliance needs identified and funded
    (eliminating Council risks)
  • Upgrades and New funding determined by Council to support 
    priority service needs
  • Councillors able to understand the cost to Council to
    fund all New / Upgrade desires listed in current Master
    Plans and Strategies
  • Organisation  and Councillors have a better understanding of 
    Councils  financial sustainability with a 20 – 30 years list of 
    works
  • Improved alignment with the Community and Council Plan
  • Improved pre-planning for Capital Works Implementation
  • Allocates resources to the highest priority
  • Better Governance as decisions based on facts.
Capital Works Monitoring
 - CAPMON
 - Exec CAPMON
 - Exec PCG
                CAPMON
• Chaired by Manager Sustainable Asset 
  Management Monthly reporting meeting with 
  Project Managers to monitor progress of 
  delivering all projects, renewals, upgrades or 
  new.

• Identify  delivery risks and ensure control 
  measures are in place

• Guidance given  to Project Managers and staff 
  to assist with the delivery the projects

• Project Managers are able to request changes 
  to project priority and to seek direction on 
  possible carryovers or deferrals.
     Exec CAPMON / Exec PCG

•   Monthly reporting meeting with Executive to monitor 
    progress of delivering due to significant number of 
    politically sensitive / major projects that require 
    Executive input or Executive Decisions
•   Minimises the need for Executives to attend all PCG 
    meetings for individual projects
•   Maximise use of time of the Executive
•   Empowers Project Managers and staff to deliver the 
    projects
•   Project Managers are required to report to Cap Mon 
    Exec / Exec PCG.
•   Meeting split in two stages 
     – Cap Mon Exec reviews the whole of the Capital Program
     – Exec PCG reviews major projects
Capital Works monitoring – Exec PCG
Capital Works Monitoring
KEY BENEFITS:
• 90% of Capital Program Delivered 
  (previous average 83%)

• Executive are briefed on status of Capital 
  Works Program

• Decision can be made to remove 
  blockages

• Risks are managed

• Good Governance
Does it all work ?
Collingwood Leisure Centre – 
       another Example
  Collingwood Leisure Centre
§ Preplanning completed prior to provision of budget – 
  Good Business Case
§ Project Implementation Plan in place
§ Good Governance structure in place that included 
  Service Manager
§ Skilled internal Project Manager
§ Good Specifications
§ Good Architect, Consultants and Builder
§ Good Project Management Systems in place to Manage 
  Time Cost Quality
§ Relationships well managed
§ Good Capital Works Reporting Tool
§ Regular reporting to PWT, Exec PCG and Council


§ The Result????
Collingwood Leisure Centre
  Successfully Delivered 
  Collingwood Leisure Centre
RESULT:
ü Delivered under budget - $7.8 Million 
ü Delivered by Christmas as required – 16 
  December 2011
ü ESD elements included
ü Quality achieved
ü Happy Service Managers
ü Happy Stakeholders
ü Happy Councillors

ü Happy Community
                    In Summary
•   Poor project planning results in poor project delivery

•   Understand and  manage Project Risks

•   Consider capacity to deliver projects, life cycle costs, 
    environmental and social benefits.

•   Allow Planning time. Time for, cost, quality , governance 
    and stakeholder management.

•   Use of Project Implementation Plans a must.

•   Monitor performance to ensure projects are delivered.
Risk Based Asset Management
    in Capital Works Delivery 



       Questions…….

				
DOCUMENT INFO
Shared By:
Categories:
Tags:
Stats:
views:0
posted:4/27/2014
language:Latin
pages:54