ANALYSING OUTSOURCING POLICIES IN AN ASSET MANAGEMENT CONTEXT: A SIX-STAGE MODEL

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1 ANALYSING OUTSOURCING POLICIES IN AN ASSET MANAGEMENT CONTEXT: A SIX-STAGE MODEL Rob Schoenmaker Assistant Professor, Faculty of Civil Engineering, Delft University of Technology, Netherlands Jules Verlaan Senior Lecturer, Faculty of Civil Engineering, Delft University of Technology, Netherlands Abstract Asset managers of civil infrastructure are increasingly outsourcing their maintenance. Whereas maintenance is a cyclic process, decisions to outsource decisions are often project-based, and confusing the discussion on the degree of outsourcing. This paper presents a six-stage model that facilitates the top-down discussion for analysing the degree of outsourcing maintenance. The model is based on the cyclic nature of maintenance. The six-stage model can: (1) give clear statements about the present state of outsourcing in each of the model; (2) facilitate discussion about the desired future state of outsourcing and (3) identify of room for improvement in aligning the s of the model. We successfully tested the model at the Dutch Road Agency in various workshops. We validated the model in discussions with experts, using the description of the past and present degree of outsourcing by the English Highways Agency. The model proves to be a simple means of communication to explain the outsourcing policy. This paper also describes the recent developments in outsourcing by Main Roads Western Australia, using the model. Key Words: asset management, maintenance, infrastructure, roads, highways, outsourcing, policy, governance, performance management Introduction The aim of the model described in this paper has been to develop a clear and simple way to describe and discuss the degree of outsourcing maintenance by road agencies. Traditionally these agencies, as asset managers, used their own staff to determine and deliver the maintenance. Over the last 15 years, more road agencies explored new territory and turned to outsource their maintenance. The first was to use private parties to execute specific tasks under direct supervision. Institutional reforms, public opinion and tighter financial means forced them seek more collaboration with private parties. More emphasis came on the use of performance-based contracts, because of the anticipated advantages of steering on outputs. In these contracts, the focus is on the results the agency wants to achieve. And in case of maintenance, the goal is to achieve those results for existing infrastructure and over a longer period. The general perception is that autonomy of the contractor and a strong links between performance and payment will be beneficial for the principal. Unfortunately it is not that simple. -based contracting also has also disadvantages and risks, such as the difficulty to define performance and the organisational consequences and the risk of opportunistic contractor behaviour. A wellbalanced approach is important for agencies considering outsourcing maintenance. Applying the model presented in the paper will help in identifying the preferred degree of outsourcing. Maintenance and Maintenance Many of definitions of maintenance exist. The European norm EN13306 (CEN, 2001), for example, defines maintenance as the activities to retain an item in, restore it to, a state in which it can perform the required function. This definition focuses on the item or asset. Moubray (1997, p. 7) focuses more on the use of the assets and defines IPWEA Conference 1

2 maintenance as: ensuring that physical assets continue to do what their users want them to do. In this paper we are looking at performance-based contracts, so it is logical to use a definition that focuses on the use of the asset rather than the asset itself. We define maintenance as the whole set of activities that are needed to keep the required function available at the agreed level of service (Schoenmaker, 2011), that means that replacement of an asset is included in our definition of maintenance. In maintenance contracts the performance level or service has to be maintained. This requires various maintenance activities, possibly including replacement of the assets. As a result maintenance has some complicating features, especially in combination with performance measurement. These complicating features can be grouped in five categories (Schoenmaker, 2011): 1. Complexity; 2. Interconnectedness and autonomy; 3. Temporal mismatch; 4. Innovation and dynamics; 5. Knowns, unknowns and unknowables. An example of complexity is the interaction of competing performance, giving a choice of alternative measures, like a rapid response at higher costs or an economic response with more hindrance. The contractor cannot always act autonomously when third parties involved in the same network or when the contractor depends on third parties for permits, information or supplies. Temporal mismatch occurs when the effects of the maintenance activities only show after completion of the contract. The dynamics are visible in the changing budgets of the client, in the (i.e. more emphasis on safety or economy) or in the developing technology, leading to news ways of working or even new levels of service. Examples of unknowns are the costs of finding out the cause of defects or if the maintenance that has now been planned for year X will be really necessary by that that time (Anastasopoulos, Florax, Labi, & Karlaftis, 2010). management Proponents emphasise the simplicity and benefits of performance management. But under certain conditions performance measurement becomes problematic. Some of these conditions are (de Bruijn, 2007): - Products are multivalued: performance management carries the risk of measuring only quantifiable outputs and ignoring the values; - Products are generated together with others: maintenance has a strong interconnectedness of activities: meaning that the activities are hard to isolate. Thus performance can only be partly attributed to a single actor - Products are interwoven: this has to do with the interconnectedness of assets: meaning that the assets are hard to isolate. Thus performance can only be attributed to a single actor if that actor maintains all the related assets. - Causalities are unknown: this is relevant when the relationship between effort and results is either not known or not visible within the timeframe of the measurement. - Environment is dynamic: when the required quality is constantly redefined, performance measurement becomes problematic. It goes without saying that the above five features of maintenance and conditions for performance management conflict. Generally, the more process s of the maintenance process are outsourced and the more abstract (or multi-valued) the performance are, the more they conflict. An important theoretical angle to deal with the complicating features comes from Fama & Jensen (1983). The idea behind it is limiting freedom of decision-making: limiting the freedom to decide reduces this risk of contractors taking decisions that are not fully in line with the interests of the client, who is, as owner of the infrastructure is ultimately the bearer of any risk that is caused by decisions of the contractor. It may therefore be in the interest of the principal to retain some decision rights. Broadly speaking, the decision process consists of four s: 1) the generation or identification of proposals for maintenance works; 2) the choice of the decision which initiatives to implement; 3) Implementation: the execution of ratified decisions, and 4) Monitoring: the measurement of the performance of the agents. -based contracting IPWEA Conference 2

3 implicitly transfers the all four s to the contractor. In some cases the client may prefer to decide which activities are implemented or not. The contractor can then be held responsible for initiation and, after ratification by the principal, for implementation and monitoring. Further addressing the specific problems of performance measurement is beyond the scope of this paper. More can be found in (de Bruijn, 2007; Pidd, 2005; Smith, 1995). Relevant aspects to identify the degree of outsourcing Four aspects are relevant to describe the degree of outsourcing (Schoenmaker R., de Bruijn J. A., & Herder P.M., 2011): 1. The object that is outsourced. What are the scope of the physical parts that are maintained, the degree of integration of the various technical disciplines and the types of maintenance that are part of the outsourcing? 2. indicators and incentives. What are the type and nature of the indicators that are used, the payment mechanisms and other specific incentives? 3. The governance. How is the contract governed and monitored by the client? 4. The division of roles. Maintenance is a cyclic process, as we show in section 4. The question is how the various in the maintenance process are allocated to the different actors. This paper focuses on the fourth aspect the maintenance process and briefly touches on aspects one and two, the types of maintenance and the performance indicators. Ad 1. Although the use of the terms routine and variable (or capital) maintenance are contradictory to performance-based contracting, these terms need some introduction here. Formally speaking the maintenance activities are a result from the needs to keep the performance at the required level of service. But these maintenance activities can be more or less cyclic, repetitive, cheap and well known in advance: routine maintenance. They can also be less cyclic, less repetitive, more expensive and unknown in advance: variable maintenance. This distinction proves relevant when we look at the actual degree of outsourcing by the road agencies. Figure 1 Levels of performance Ad 2. Figure 1 (AustRoads, 2003; Porter, 2005) shows that the road agency can operationalise its goals and s at various levels of performance, The road agency has the choice on which level it outsources its maintenance. On the level of input driven, the focus is on what has to be done and how. Output driven indicators tell the contractor when something has to be done, whereas more abstract indicators define the why of the infrastructure, and the contractor has to make sure the effects are achieved. Introducing the Six-stage Model The cyclic nature of the maintenance process is emphasised in various publications (AustRoads, 2009; BSI, 2008a, 2008b; Coetzee, 1999; Marquez & Gupta, 2006) Common in these publications and the models they use, are three cyclic processes: 1) The planning and execution of routine maintenance; 2) The identification, planning and execution of maintenance aimed at improvements; and 3) The identification, planning and execution of maintenance because change. The insights form these publications were combined with a model based on earlier work of Dunn (1999) and Murthy & Kobbacy (2008, pp ). We expanded their model with a clear input and output and a more comprehensive description of each (see figure 2). Input to our model are the performance that have to be maintained, followed by a cyclic process of measurement, analysis, work identification, planning, work preparation and execution. The output of the model is the performance of the system (of maintained assets). IPWEA Conference 3

4 Figure 2 Six-stage model of maintenance The area within the dotted line is the maintenance process. The output of the maintenance process is the performance that has to comply with the performance that are the input to this model. The model encompasses two of the three cyclic processes mentioned before. The third cyclic process is in fact a feedback loop from the effects of the delivered performance back to the goals and s leading to adjustments when necessary. Should the change, this will show as a change in the input to the maintenance process. A detailed, more formal description of every in the process is given in Appendix A. The s in the right part of the model depict the short-term loop of routine or cyclic maintenance. The work is executed according to predefined plans and the data is updated. The loop with the s analysis and work identification also includes renewal and improvement of the assets. Based on measurement and inspection, a maintenance database is kept up to date with condition data and performance data of the assets. These data are analysed, and based on the results certain works are identified. The w are planned and budgeted while taking usage, urgency and other inventions into account. Periodically the required budget is confronted with the available budget and possibly leads to different prioritisation of works or to an adjustment of performance e.g., reducing the speed limit rather than resurfacing the road. This prioritisation leads to a more detailed planning and preliminary design. Only then the work will be scheduled and finally executed. Application of the model: typical examples of outsourcing Before applying the model on real-life cases, the model is applied to two typical examples of outsourcing. Based on Dunn (1999) and Murthy & Kobbacy (2008), there are roughly three levels of outsourcing (See figure 3). At level C the contractor is only providing resources to schedule and execute the work. This is the minimal level of outsourcing; the client does all the maintenance management and only uses the market to do the actual work in the field. At level B the contractor has more freedom to decide to do what and when, based on the specifications by the client. Figure 3 Levels of outsourcing At level A the contractor is free to take all decisions that are required to keep the output at the required level. This is our second example. When analysing a certain case of outsourcing, each of the maintenance process is evaluated choosing one of the descriptions shown in Appendix B. The degree to which each is outsourced is illustrated in the model using colours (here only black, white and grey). Traditional outsourcing. Figure 4 shows the traditional way of contracting. The agency identifies, plans and contracts out maintenance activities. Note the arrow between planning and design and work scheduling. That arrow has changed over time. Agencies gradually moved from detailed specifications, prescribing materials and quantities to more functional specifications. These contracts are, confusingly, also known as performance-based maintenance con- IPWEA Conference 4

5 tracts, but actually they only specify the output of a specific maintenance activity, and are project-based. maintenance, resulting in performance that focus on the when (as in figure 1) for specific types of assets. Analysis of the scope of the contract, using the sixstage model, showed the lack of attention to data management. This was confirmed by an audit that investigated the problems with the early contracts and confirmed the lack of data as one of the causes for the suboptimal operations (Rijkswaterstaat, 2005b). Figure 4 Traditional contracting White = client, Black = contractor Design-Build-Finance- Maintain. In a Design-Build-Finance- Maintain (DBFM) contract (figure 5) the contractor not only builds and finances the assets, but also maintains the assets for several years. In return the contractor receives a payment based on availability of the assets. A notable feature is the absence of the feedback loop via prioritisation to the performance. This illustrates the inflexibility of a DBFM contract. The performance are fixed and the contractor is not allowed to make changes to them. Figure 6 Routine maintenance Rijkswaterstaat White = client, Black = contractor The above maintenance contracts were deliberately limited to routine maintenance activities. Rijkswaterstaat wanted to keep the identification and planning of variable maintenance in-house, resulting in figure 7 for the outsourcing of variable maintenance: project-based. Figure 5 Design-Build-Finance-Maintain contract White = client, Black = contractor Application of the model in reality Rijkswaterstaat - The Netherlands In 2004 Rijkswaterstaat, the Dutch road agency introduced performance-based maintenance contracts. Figure 6 shows the degree of outsourcing of the earlier versions of these contracts (Rijkswaterstaat, 2004, 2005a). At one time, about fifty of these relatively small contracts were in operation. The scope of the contract is limited to routine Figure 7 Variable maintenance Rijkswaterstaat White = client, Black = contractor These contracts were also called performance-based contract, but the performance aspect was limited to the content of the arrow from planning/design to work scheduling. That arrow became more and more functional instead of prescriptive. For a more detailed division of roles, see appendix C1. Highways Agency England The English road agency, The Highways Agency, took over management of the roads IPWEA Conference 5

6 from the local councils in 1997 and introduced the Managing Agent - Term Maintenance Contract. This performancebased contract, with a consulting agency as managing agent doing the maintenance management and a contractor as term maintenance contractor doing the actual work outside, was replaced from 2002 onwards by the Managing Agent Contractor (MAC) contracts. The MAC combined both roles. Over the years these contracts grew larger as the number of contracts was reduced. Figure 8 shows the principle of MAC contracts for routine maintenance. The performance were largely prescribed in the Trunk Road Maintenance Manual (Highways Agency, 1999), later in the Network Management Manual (Highways Agency, 2009). The now operational Asset Service Contracts (ASC) have replaced the prescriptive with more performance-based (Highways Agency, 2011), moving to the when as in figure 1. Common for the MAC contracts is that the contractor is fully responsible for the delivery of the performance : thus including all s of the process. prioritise not only within a contract but also across contracts. Figure 9 Variable maintenance (below threshold) Highways Agency, White = client, Black = contractor If the costs of a maintenance work is estimated above the threshold amount, the work is executed by a third party, under management of the MAC contractor, as shown in figure 10. Figure 8 Routine maintenance Highways Agency White = client, Black = contractor The situation for performance indicators leading to maintenance not included in the manuals is more complicated (see figures 9 and 10). The contractor is responsible for all s of the maintenance process as long as the costs of the maintenance works do no exceed a threshold. This threshold was originally 250k, grew to 500 and is now 10M in the ASC. The contractor, however, is not fully autonomous in deciding which maintenance works to execute. The decision lies with the Highways Agency, as illustrated by the block Joint decision making. This gives the Highways Agency the room to Figure 10 Variable maintenance (above threshold) Highways Agency, White = client, Black = contractor, Grey + Third Party For a more detailed division of roles within the MAC contract, see appendix C2. Finally we will briefly illustrate the results of using the model for two consecutive generations of contracts in Western Australia. Main Roads Western Australia In 1998, Main Roads Western Australia (MRWA) developed the Term Network Contracts (TNC): a ten year contract for the provision of the s of MRWA through the delivery of road maintenance and rehabilitation. Figure 11, shows the TNC contract. The input, the performance were outcome-based (why, as in figure 1). Two things are worth noting. The grey block prioritisation illustrates the absence of the possibility of prioritisation by MRWA. The TNC contractor is fully responsible for the achievement of the performance. The block data IPWEA Conference 6

7 management is also grey, the TNC s lacked clear data management provisions clear. Figure 11 is based on interviews with experts. Figure 11 Term Network Contract MRWA White = client, Black = contractor, Grey + Third Party MRWA identified that the follow-up of these contracts needed more flexibility to manage uncertainty and readily adjust to change. Starting in 2010/11 the TNC s were replaced by Integrated Services Agreements (ISA). These ISA s provided MRWA with flexibility and allowed MRWA to become a better informed client (Main Roads Western Australia, 2010a, 2010b, 2010c). In figure 12, the flexibility is shown by the presence of the prioritisation block (white) and the extra joint decision-making block in which the MRWA has the final decision right on the maintenance activities proposed by the ISA contractor. The execution of maintenance works above AUS$3M is done by a third party. Figure 12 Integrated Service Agreement MRWA White = client, Black = contractor, Grey + Third Party For a more detailed division of roles within the ISA contract, see appendix C3. Conclusion and future work Based on the use of the six-stage in three different road agencies, we can conclude that the six-stage model can: 1. Give clear statements about the present state of outsourcing in each of the model; 2. Facilitate discussion about the desired future state of outsourcing and 3. Identify of room for improvement in aligning the s of the model. Future work with this model is aimed at aligning the organisation of the road agency according to this primary process, and at opening possibilities for prescribing this model as a framework for the quality management plans of contractor. Acknowledgements We would like to thank Scott Bloxsom (Essency Consulting) and Peter Waters (W.A. Atkins) for their input and advice in both developing the model and applying the model in the English and Australian cases. References Anastasopoulos, Panagiotis Ch, Florax, Raymond J. G. M., Labi, Samuel, & Karlaftis, Mathew G. (2010). Contracting in highway maintenance and rehabilitation: Are spatial effects important? Transportation Research Part A: Policy and Practice, 44(3), doi: /j.tra AustRoads. (2003). Development of Contracts and Specifications Summary Report (Vol. AP T25/03). Sydney: Austroads Incorporated. AustRoads. (2009). Guide to Asset Management (2nd ed. Vol. 1). Sydney: AustRoads Incorporated. BSI. (2008a). PAS 55-1 Asset Management Part 1: Specification for the optimized management of physical infrastructure assets. London: British Standard Institution. BSI. (2008b). PAS 55-2 Asset Management Part 2: Guidelines for the application of PAS London: British Standard Institution. CEN. (2001). EN Maintenance Terminology. Brussel: CEN. Coetzee, J.L. (1999). A holistic approach to the maintenance "problem'". Journal of Quality in Maintenance Engineering, 5(3), IPWEA Conference 7

8 de Bruijn, J.A. (2007). Managing performance in the public sector. Utrecht: Routledge. Dunn, S. (1999). Maintenance Outsourcing - Critical Issues. Retrieved , from Fama, Eugene F., & Jensen, Michael C. (1983). Agency Problems and Residual Claims. Journal of Law and Economics, 26(2), Highways Agency. (1999). Trunk Road Maintenance Manual: Volume 2 Routine and Winter Maintenance Code (T. S. Office Ed.). London: The Stationery Office. Highways Agency. (2009). Network Management Manual Routine Maintenance (Vol. 3). Leeds. Highways Agency. (2011). Asset Maintenance and Operational Requirements - Area 10. Birmingham: Highways Agency. Main Roads Western Australia. (2010a). Integrated Services Arrangements - RFP C25/08 - Part A. Perth. Main Roads Western Australia. (2010b). Integrated Services Arrangements - RFP C25/08 - Part B. Perth. Main Roads Western Australia. (2010c). Integrated Services Arrangements - RFP C25/08 - Part C. Perth. Marquez, A.C., & Gupta, J.N.D. (2006). Contemporary maintenance management: process, framework and supporting pillars. The International Journal of Managementn Science, 34(3), Moubray, John. (1997). Reliability-centered maintenance (2nd (2007 reprint) ed.). Oxford: Elsevier. Murthy, D.N.P., & Kobbacy, K.A.H. (2008). Complex system maintenance handbook. London: Springer. Pidd, M. (2005). Perversity in public service performance measurement. International Journal of Productivity and Management, 54(5/6), Porter, T. (2005). Procurement Models for Road Maintenance. Paper presented at the Annual Conference of the Transportation Association of Canada, Calgary, Canada. Rijkswaterstaat. (2004). Handreiking bij het modelprestatiebestek "Droog" (Vol. Versie 3). Utrecht: ExpertiseCentrum Opdrachtgeverschap. Rijkswaterstaat. (2005a). Model Prestatiebestek Onderhoud "Droog" versie 5. In Rijkswaterstaat (Ed.). Utrecht: ExpertiseCentrum Opdrachtgeverschap. Rijkswaterstaat. (2005b). Quick Scan prestatiebestekken. Den Haag: SDG Markt en Inkoop. Schoenmaker, R. (2011). De ingeslagen weg (The chosen way). (PhD), Delft University of Technology, Delft. Schoenmaker R., de Bruijn J. A., & Herder P.M. (2011). The Dynamics of Outsourcing Maintenance of Civil infrastructures in -Based Contracts. Paper presented at the World Conference of Engineering Asset Management, Cincinnati, OH. Smith, P. (1995). On the unintended consequences of publishing performance data in the public sector. International Journal of Public Administration, 18(2), IPWEA Conference 8

9 Appendix A The s of the six-stage model Goals, s Develop organizational goals and s Determine the Measurement, inspection Measure and inspect the assets Data management Manage the data Analysis Identify the needs Work identification Identify the solutions Planning/design Plan and design the intervention Prioritisation Prioritise the interventions Work scheduling Schedule for delivery Work execution Deliver the work Goal Produce, implement, review and update the, aims and s of the (regional) road agency Translate the s into SMART s that describe the of the network and the of the supporting processes. Provide an accurate record of the condition and performance of the assets, recommend and undertake surveys to support analysis and work identification Establish and maintain an accurate and up to date asset inventory and associated condition and performance data to support use of this data by the other processes. Analyse data and intelligence gathered and documented to identify trends, faults, intervention levels that are in conflict or future conflict with the Produce effective solutions that satisfy the identified needs to keep the assets in line with the Deliver maintenance plans and preliminary designs of the solutions Weigh the proposed interventions on preset criteria, the available budgets and impact on. If necessary propose changes in if available budgets do not cover the identified needs Prepare for construction to ensure the delivery is to pre-determined cost and time Efficiently deliver the maintenance work and deliver input for the data management systems IPWEA Conference 9

10 Appendix B Terms used to identify role of the actors in maintenance process Approve Advice Advice Approve - 0-inspection Advice - before contract Deliver Deliver Advice - during contract Develop & deliver Deliver - before contract Approve Supply data Deliver - before contract Approve & input Deliver - corporate Collect & provide Deliver - corporate/regional Deliver Deliver - partially Deliver 0 - inspection Develop & deliver Deliver - partially Independent audit Develop N/A Develop & deliver Own, review Maintain Review N/A Review & approve Review & approve Review & deliver Supply & maintain Review & deliver - during contr Understand and apply Understand and comply Understand, apply & comply IPWEA Conference 10

11 Appendix C1 Rijkswaterstaat -based Maintenance Contract Cyclic, Routine Maintenance Deliver - corporate Understand and apply Determine the performance Deliver - corporate/regional Understand, apply & comply Analysis Analyse the data of the performance Review & approve Collect & provide of the technical condition Review & approve Collect & provide Review & approve Collect & provide Work identification Identify the solution N/A N/A Prioritise Prioritise the solutions N/A N/A Planning, design Plan and design the Current year Review & approve Develop & deliver solution Next year N/A N/A Forward planning (> 1 yr) N/A N/A Work scheduling Schedule the work Review & approve Develop & deliver Work execution Execute the work Review & approve Deliver Data management Manage the data Own, review Supply & maintain Measurement, inspection Collect the data Deliver - partially Deliver - partially Capital works (included in contract) Deliver - corporate Understand and apply Determine the performance Deliver - Understand and comply corporate/regional Analysis Analyse the data of the performance Review & deliver Collect & provide of the technical condition Review & deliver Collect & provide Review & deliver Collect & provide Work identification Identify the solution Deliver - before contract Understand and apply Approve - 0-inspection Deliver - 0-inspection Review & deliver - during Advice - during contract contr Prioritise Prioritise the solutions Deliver Advice Planning, design Plan and design the solution Current year Deliver Advice Next year Deliver N/A Forward planning (> 1 yr) Deliver N/A Work scheduling Schedule the work Review & approve Develop & deliver Work execution Execute the work Review & approve Deliver Data management Manage the data Own, review Supply & maintain Measurement, inspection Collect the data Deliver - partially Deliver - partially Capital works (in other contracts) Deliver - corporate Understand and apply Determine the performance Deliver - Understand and apply corporate/regional Analysis Analyse the data of the performance Review & deliver Collect & provide of the technical condition Review & deliver Collect & provide Review & deliver Collect & provide Work identification Identify the solution Deliver - before contract Advice - before contract Approve - 0-inspection Deliver - 0-inspection Review & deliver - during Advice - during contract contr Prioritise Prioritise the solutions Deliver N/A Planning, design Plan and design the Current year Deliver N/A solution Next year Deliver N/A Forward planning (> 1 yr) Deliver N/A Work scheduling Schedule the work Review & approve N/A Develop & deliver Work execution Execute the work Review & approve N/A Deliver Data management Manage the data Own, review Maintain Supply data Measurement, inspection Collect the data Deliver - partially Deliver - partially Supply data IPWEA Conference 11

12 Appendix C2 Highways Agency Managing Agent Contractor Contract Cyclic, Routine Maintenance Deliver - corporate Understand and apply Determine the performance Develop & deliver Understand and comply Analysis Analyse the data of the performance Review & approve Deliver of the technical condition Review & approve Deliver Review & approve Deliver Work identification Identify the solution N/A N/A Prioritise Prioritise the solutions N/A N/A Planning, desgin Plan and desgin the Current year Review & approve Develop & deliver sloutions Next year Review & approve Develop & deliver Forward planning (> 1 yr) N/A N/A Work schedulng Schedule the work Review Deliver Work execution Execute the work N/A Deliver Data management Manage the data Independent audit Deliver Measurement, inspection Collect the data Independent audit Deliver Capital works (below threshold) Deliver - corporate Understand and apply Determine the performance Develop & deliver Understand and comply Analysis Analyse the data of the performance Review & approve Deliver of the technical condition Review & approve Deliver Review & approve Deliver Work identification Identify the solution Review & approve Deliver Prioritise Prioritise the solutions Review & approve Deliver Planning, desgin Plan and desgin the Current year Review & approve Develop & deliver sloutions Next year Review & approve Develop & deliver Forward planning (> 1 yr) Review & approve Develop & deliver Work schedulng Schedule the work Review & approve Deliver Work execution Execute the work N/A Deliver Data management Manage the data Independent audit Deliver Measurement, inspection Collect the data Independent audit Deliver Capital works (above 500k) Deliver - corporate Understand, apply & comply Determine the performance Develop & deliver Understand and comply Analysis Analyse the data of the performance Review & approve Deliver of the technical condition Review & approve Deliver Review & approve Deliver Work identification Identify the solution Review & approve Deliver Prioritise Prioritise the solutions Review & approve Deliver Planning, desgin Plan and desgin the Current year Review & approve Develop & deliver sloutions Next year Review & approve Develop & deliver Forward planning (> 1 yr) Review & approve Develop & deliver Work schedulng Schedule the work N/A Review & approve Develop & deliver Work execution Execute the work N/A Review & approve Deliver Data management Manage the data Independent audit Deliver Supply data Measurement, inspection Collect the data Independent audit Deliver Supply data IPWEA Conference 12

13 Appendix C3 Main Roads Western Australia Integrated Service Agreements Cyclic, Routine Maintenance Deliver Understand and apply Determine the performance Develop & deliver Understand and comply Analysis Analyse the data of the performance Review & approve Deliver of the technical condition Review & approve Deliver Review & approve Deliver Work identification Identify the solution N/A N/A Prioritise Prioritise the solutions N/A N/A Planning, desgin Plan and desgin the Current year Review & approve Develop & deliver sloutions Next year Review & approve Develop & deliver Forward planning (> 1 yr) N/A N/A Work schedulng Schedule the work Review Deliver Work execution Execute the work Review Deliver Data management Manage the data Review Deliver Measurement, inspection Collect the data Review Deliver Capital works (below threshold) Deliver Understand and apply Determine the performance Develop & deliver Understand and comply Analysis Analyse the data of the performance Review & approve Deliver of the technical condition Review & approve Deliver Review & approve Deliver Work identification Identify the solution Review & approve Deliver Prioritise Prioritise the solutions Review & approve Deliver Planning, desgin Plan and desgin the Current year Review & approve Develop & deliver sloutions Next year Review & approve Develop & deliver Forward planning (> 1 yr) N/A N/A Work schedulng Schedule the work Review Deliver Work execution Execute the work Review Deliver Data management Manage the data Review Deliver Measurement, inspection Collect the data Review Deliver Capital works (above $3M) Deliver Understand and apply Determine the performance Approve Develop & deliver Analysis Analyse the data of the performance Review Deliver of the technical condition Review Deliver Review Deliver Work identification Identify the solution Approve Develop & deliver Prioritise Prioritise the solutions Approve Develop & deliver Planning, desgin Plan and desgin the Current year Review & approve Develop & deliver sloutions Next year Approve Develop & deliver Forward planning (> 1 yr) Approve Develop Work schedulng Schedule the work Review Develop Develop & deliver Work execution Execute the work Review Approve Deliver Data management Manage the data Review Approve & input Supply data Measurement, inspection Collect the data Review Deliver Advice IPWEA Conference 13

14 Institute of Public Works Engineering Australasia Conference - 12/14 August - Darwin, NT, Australia Biography Rob Schoenmaker (1958) holds a PhD in Technology, Policy and Management. He studied Naval Engineering in Vlissingen, continued his personal development in IT, management, maintenance, and most recently, asset management. He received his PhD in 2011, after successfully defending his thesis on the management of outsourced asset management. In his present work as an advisor within Rijkswaterstaat, the Dutch Road Agency, he deals with strategic matters on policy, control, organisation, and performance management and outsourcing, all related to the management of civil infrastructure assets. In 2011 he joined the faculty of Civil engineering and Geosciences at TU Delft as assistant professor, where he teaches in the master Construction Management and Engineering. Focus of his research is questions related to the effective and efficient application of (outsourced) asset management. Jules Verlaan (1952) holds a master in Civil Engineering and a master in Business Economics. He started his professional career in Hydraulic Engineering and worked for Rijkswaterstaat, a Dutch Agency for Infrastructure and Transport. In 2007 he joined Delft University of Technology in the Netherlands as a Senior Lecturer and as director of Education of the master Construction Management and Engineering. His main focus of research is related to the economic aspects of infrastructure management. IPWEA Conference 14