International Transmission Asset Management Study (ITAMS)

Transcription

1 International Transmission Asset Management Study (ITAMS) Measuring and Comparing TSO s Asset Management Performance February, 2014 Johan Huisma, Program manager ITAMS UMS Group Europe region

2 Confidentiality This document is confidential and intended for the sole use of the client to whom it is addressed. The information and methodologies outlined herein are proprietary and their expression in this document is copyrighted, with all rights reserved to UMS Group Inc. Copying or distributing this material without prior written permission is strictly prohibited. UMS Group Inc., All Rights Reserved ITAMS February,

4 Implementing Asset Management a Key Differentiator? Some pressing questions regarding Asset Management: 1. Is implementing Asset Management justified and does it deliver a better outcome than without explicitly implementing Asset Management? 2. Is having a PAS 55/ISO certificate a guarantee for good Asset Management? 3. Can taking part in a global study create an insight how to build the business case for Asset Management? 4. Does participating in a global learning consortium help a company to meet its commitment for continual improvement? ITAMS provides answers to all these questions! UMS Group Inc., All Rights Reserved ITAMS February,

5 International Transmission Asset Management Study (ITAMS) 1. ITAMS is a global benchmarking and best practice learning consortium of comparable Transmission System Operators (TSOs). 2. ITAMS is designed to serve the needs of leading companies in the area of Asset Management by creating insights into leading practices for improving the effectiveness of Asset Managers. 3. Each cycle of ITAMS ends with a results/best practices conference designed for sharing knowledge and addressing opportunities and improvement initiatives. 4. ITAMS is ongoing (2 years cycle) and participant driven: - Ongoing analysis allows tracking of progress and development; - ITAMS adapts to changing needs and priorities of participants; - ITAMS is guided towards the major priorities and emerging issues for the industry by an Executive Advisory Board comprised of participants. ITAMS drives the wish/commitment for continual improvement UMS Group Inc., All Rights Reserved ITAMS February,

6 Asset Management Fundamentals (ISO 55000) Asset management is based on a set of fundamentals. a) Value: Assets exist to provide value to the organization and its stakeholders. b) Alignment: Asset management translates the organizational objectives into technical and financial decisions, plans and activities. c) Leadership: Leadership and workplace culture are determinants of realization of value. d) Assurance: Asset management gives assurance that assets will fulfil their required purpose. The absence of any one fundamental can result in a reduction in the value realized from assets. ITAMS assesses to which extent these fundamentals are present UMS Group Inc., All Rights Reserved ITAMS February,

7 Scope of ITAMS At its heart, asset management provides clarity around the accountabilities for producing business results. Strategic Asset Owner (Why/when: AM-policy, objectives) Assessed Key Areas Tactical Asset Manager (What: SAMP, AM-plans) Operational SPs (How: execution AM-plans) ITAMS Operating model IM & ET Process Competences ITAMS focuses mainly on benchmarking the effectiveness of the Asset Manager UMS Group Inc., All Rights Reserved ITAMS February,

8 ITAMS and PAS 55/ISO are complementary PAS 55/ISO 55000: gives an insight into how aligned all elements of your AM-system are; addresses where the management system should be improved, but not how, or with which means. ITAMS: benchmarks the maturity, alignment and completeness of your AM-system (against peers); shows the effectiveness of your Asset Management; shows how (well) your Asset Management is performed, organized and supported and allows you to learn from the best practices; covers quantitative, specific and practically applicable elements, complementary to PAS 55/ISO ITAMS even covers what s beyond PAS 55/ISO UMS Group Inc., All Rights Reserved ITAMS February,

9 Road to Best Practice Asset Management Phase I Phase II Phase III Phase IV Phase V Phase VI DIAGNOSTICS SET DIRECTION & BUILD ALIGNMENT DESIGN THE CHANGE LEARN TO WORK IN THE NEW PROCESS CERTIFICATION GETTING EXCELLENT Asset Management GAP Analyses Plan Create Implementing Solutions Grounding Strategic Asset Management Certification Continual Improvement Enabling Technology for Asset Management 2-4 years ITAMS Every 2 years ITAMS Every 2 years ITAMS ITAMS guides you to Best Practice Asset Management and beyond UMS Group Inc., All Rights Reserved ITAMS February,

10 Opportunities & Benefits (1) ITAMS provides: Most effective Performance, Business Value and Risk Management frameworks Major improvement areas for getting in shape for PAS 55/ISO Maturity of technical and nontechnical competences Number of staff and organization cost compared with common key figures (correlations) Maturity and completeness of AMprocess (Risk Management; Asset Strategy; Investment Planning; Investment Delivery Management) Benefit High added value (tangible and/or intangible) Complete Line of Sight ; Readiness for PAS 55/ISO Business minded culture at AM Efficient AM-process Complete and effective best practice AM-process UMS Group Inc., All Rights Reserved ITAMS February,

11 Opportunities & Benefits (2) ITAMS provides: Maturity and completeness of applied methods for decision making and decision support tools Investment planning practices: portfolio management, scenario planning and optimization Investment delivery practices, especially how to close the loop by measurement and feedback Most commonly applied ITmanagement structures and ITsystems/tools Maturity and gaps of all major AMdimensions; Best Practices of peers Benefit Effective decision making Optimal balance between performance, cost en risk Effective contracts and control of SPs Complete and effective ITsupport Continual improvement UMS Group Inc., All Rights Reserved ITAMS February,

12 In Conclusion 1. Asset management excellence is considered to be needed to tackle the challenges companies face nowadays effectively. ITAMS provides insight into company-specific benefits that comes along with implementing Asset Management. 2. Compliance with standards (PAS 55/ISO 55000) is not the same as asset management excellence. However, the application of standards could be an important step on the journey to asset management excellence together with engagement and leadership. ITAMS goes beyond and measures the effectiveness of your asset management system and how well your Asset Management is organized and performed. 3. Implementing the improvements identified by an exercise such as ITAMS is not the same as implementing a full-scale Strategic Asset Management Transformation. However, the framework of ITAMS is a good base for building a business case to do so. 4. ITAMS is ongoing and compares all major AM-dimensions, identifies the best practices at and latest improvements made by your peers and supports by that your wish/commitment for continual improvement. UMS Group Inc., All Rights Reserved ITAMS February,

14 ITAMS Basic Principles of the Program 1) ITAMS is conducted with reference to the Business Model as shown below. Asset Owner Ownership (Financial Assets) Asset Manager Decision Making (Physical Assets) Service Provider Action (Human Assets) 2) The data pack/program is designed to assess two hypotheses: High Asset Management performance delivers high value; High Asset Management performance goes with (a) high-developed Operating Model, Process, IT-support and Competences. 3) Within ITAMS, the processes of the Asset Manager are assessed against a broadly acknowledged Reference Model. 4) The program is conducted according the UMS benchmark methodology: Benchmarking within a Global Learning Consortium. UMS Group Inc., All Rights Reserved ITAMS February,

15 Asset Management Performance Hypothesis 1 Low Impact zone No need for Asset Management Operating Performance High developed Asset Management will keep your risks acceptable and deliver you high performance and good value for money UMS Group Inc., All Rights Reserved ITAMS February,

16 Hypothesis 2 Transparent Operating Model Clearly defined roles and responsibilities create necessary focus. III II I IV V I II III IV V Comprehensive/Mature Processes Process orientation ( line of sight ) is a key differentiator. V IV III II I V III IV I II Supporting Information Management & Enabling Technology Data matters! Excellent Competences/Skills Balanced mix of technical and non-technical competences helps to facilitate the necessary culture change. High developed Asset Management can only be accomplished with a balanced mix of core and enabling success factors UMS Group Inc., All Rights Reserved ITAMS February,

17 Asset Management Reference Model Asset Owner (role) Asset Manager (role) Service Provider (role) Risk (& Opportunity) management Asset (System) strategy Investment planning Investment delivery management Performance management (KPI s; Progress reports; Asset performance; Feedback; Etc.) Information Management & Enabling Technology (Data model; Data repository; Decision support tools; ERP; GIS; Knowledge Management; Etc.) UMS Group Inc., All Rights Reserved ITAMS February,

18 Value/Risk Based Asset Management Company Strategy Business Values, KSFs & KPIs AM Policy Risk Matrix AM Objectives & Targets Asset Health Index (Functional) Strategies & Policies, Standards SAMP AM MT Plan External Inventory of Issues Risk & Opportunity Analysis Development/ Design of AM Plans (Solutions) AM Plans Top-down AM Plans Bottom-up Optimization Contracting Asset related Performance & Condition Monitoring UMS Group Inc., All Rights Reserved ITAMS February,

19 Main assessed Elements (Data Pack) General Ownership Major key figures KPI targets and scores Major projects performed and planned R&D Key Figures System size Customer mix Network characteristics (circuit length, no. of transformers, global condition of assets, etc.) Type of regulation Financials OPEX Financials CAPEX Performance (SML, LTIF, etc.) Operating model Business roles (AO,AM, SP) Organizational structure (e.g. FTEs and costs) Asset Management policy Stakeholder importance Business Value Framework Performance management (KPIs) Asset Management objectives Risk management Level and quality of documentation Leadership Continual improvement Competences Maturity of technical competences Maturity of non-technical competences Willingness to change and learn Capacity for executing core processes Level of experience Education/training Employee appraisal Budget and time for training and education Process Maturity of sub-processes: RM, ASS, IP, IDM FTEs per sub-process Output per sub-process Life cycle management Asset strategies & functional policies Decision making skills Optimization/prioritization Standardization Conformity with terms of delivery Analyze/evaluation of completed work IM & ET Maturity of enabling technology/itsystems Quality and completeness of data Data model Information Management capability AM ownership of IT and data Knowledge management Applied IT-tools UMS Group Inc., All Rights Reserved ITAMS February,

20 ITAMS Results Framework The gathered data will be analyzed and reported according the ITAMS Results Framework, see the diagram opposite. The comparative analyses in each functional area will be conducted based on: transactional metrics; KPIs; business practices. Operating Performance (OP) Level 1 System Minutes Lost % CAPEX delivered LTIF % OPEX delivered ROCE System Availability Key Areas Level 2 Operating Model Competences Process IM & ET Core Enabler (Core vs. Enabler) vs. OP Level 3 Findings & Recommendations UMS Group Inc., All Rights Reserved ITAMS February,

22 Final Report Table of Contents # of graphs # of pages 1 Introduction Summary of Findings and Recommendations (23) (22) Overall position against Peers 2 2 High level summary of Findings and Recommendations 1 4 General Findings ITAMS 2014 Program - 2 High level Findings per Key Element 4 9 Key Figures - 1 Correlation graphs Level 1 - Operating Performance Level 2 - Asset Management detailed Performance Level 3 - Asset Management high level Performance Program Background and Objectives ITAMS Results Framework Contact Information - 1 UMS Group Inc., All Rights Reserved ITAMS February,

24 Business Practices (2) 4. Clearly defined Asset Management policy Company 2.0 Five Best Performers BP-1 (5.0); BP-2 (4.5); BP-3 (4.3); BP-4 (4.0); BP-5 (3.7) BPs have (a/an): Clear defined AO-role; Clear structure for the Asset Manager with a centralized responsibility/accountability; More balanced Business Value Framework and set of connected KPIs; Implemented and applied Risk Tolerability Matrix; A certified process (PAS 55 or other). Remarks/comments: A guiding BVF (including a Risk Tolerability Matrix) is developed but implementation and use are still in an early stage. UMS Group Inc., All Rights Reserved ITAMS February,

25 Documented Quality (1 = Very Poor, 5= Very Good) Level 2 Operating Model At Level 2 regarding Operating Model e.g. the following Topics are analyzed and reported: Stakeholder Importance Distribution Business Value Importance Distribution KPI Importance Targets set to the Asset Manager Asset Owners Risk Tolerance Presence of a Risk Register Leading Asset Related Risks in Risk Register Completeness of Process Documentation Asset Management Roles (AO, AM, SP) Number of Service Providers Key Activities Outsourced Number of FTEs in AM per Function 100% 75% 50% Number of negative press publications Number of incidents with loss of supply 5 OPEX conformity to yearly plan System Minutes Lost 4 CAPEX conformity to yearly plan Number of fines / findings of liability Number of environment-related incidents KPI Importance G BP Avg. Avg Transmission Circuit availability Transformer availability Number of customer complaints Number of safety-related accidents Completeness of Process Documentation Documented: G Documented: BP Avg. Documented: Avg. Quality: G Quality: BP Avg. Quality: Avg # of Topics # of Analyzes (Graphs) approx 21 approx 26 25% 0% Roles, responsibilities, authorities Job descriptions Procedures Process flow diagrams RACIs Process performance indicators 1 0 UMS Group Inc., All Rights Reserved ITAMS February,

26 Level 3 AM-performance vs. Operating performance Based on the results found in the first two cycles there is strong evidence that the initial hypotheses and the study approach are valid UMS Group Inc., All Rights Reserved ITAMS February,

27 Key Findings ITAMS Leadership in developing business plans and policies, and measuring business performance drives good results. 2. Holistic view of the risk management and prioritization/optimization is a key differentiator. Good performers have implemented integral portfolio management, scenario planning and prioritization/optimization. 3. Quality control ( close the loop ) within the investment delivery shows significant room for improvement at most companies. Companies with a high level of externally outsourced SP-work score the best. 5. Separation between IT demand (ownership at AM) and IT supply has not been implemented broadly. 6. Most participants are still in the middle of the transforming from an engineering-based to a business-minded culture. UMS Group Inc., All Rights Reserved ITAMS February,

28 Best practices ITAMS 2012 Specific best practices/topics have been identified and shared in presentation during the ITAMS 2012 Conference: Risk management: How many risks should be in a risk register? Portfolio management (optimization) Asset health indexing Project Tracking System Easy Cost Calculation Module Risk management and replacement strategies all in one tool! Business & data intelligence, the next frontier in Asset Management! UMS Group Inc., All Rights Reserved ITAMS February,

30 ITAMS Program Structure & Schedule Program design & development 2. Program review workshop(s) 3. Update data pack & instruction manual 4. Data collection & submittal 5. Data validation 6. Analyze data 7. First draft 8. Quality check (proof reading) 9. Issue draft reports 10a. Gather feedback 10b. Interviews best performers 11. Issue final reports 12. Results conference Meeting participants Meeting Advisory Board Issue Data Pack Activity by: UMS Participants UMS Group Inc., All Rights Reserved ITAMS February,

31 Participants ITAMS Europe America Asia & Australia Middle East & Africa Amprion (DE) Elia (BE) Energinet.dk (DK) Fingrid (FI) TenneT (NL) TenneT (DE) Swissgrid (CH) ELES (SL) MAVIR (HU) LitGRID(LT) LANDSNET (IS) TERNA (IT) HOPS (HR) EirGrid (IE) SaskPower (CA) BC Hydro (CA) TVA (US) ATCO Electric (CA) TransGrid (AU) ElectraNet (AU) TRANSPOWER (NZ) TRANSCO (AE) OETC (OM) ITAMS 2014 ITAMS 2010/2012 ITAMS 2014: Already 14 companies confirmed their participation and another 4 have indicated their active interest to participate UMS Group Inc., All Rights Reserved ITAMS February,

32 Pricing of ITAMS 2014 The fee for participants will be: Conducting benchmark and providing report for a fee per participant of: - Non ITOMS / ITAMS participants 36, Past ITOMS / ITAMS participants 28, Additional direct UMS Group Expenses (billed separately estimated at 7,500.--) Additional Services Optional data collection support by UMS personnel Optional on-site result workshops Optional custom analysis and reports UMS Group Inc., All Rights Reserved ITAMS February,

34 About UMS Group UMS Group is an international management consulting firm, founded in UMS Group profile: Recognized leader in diagnostics and benchmarking, performance improvement and ongoing performance management. Demonstrated leader in business strategy within regulated utility industries. Exceptional base of experience in Asset Management transformation. Major involvement with companies undergoing energy reform and privatization. Working with leading energy and other infrastructure owners worldwide on performance improvement initiatives. UMS Group is appointed by the Institute of Asset Management as a PAS 55 Endorsed Assessor. UMS Group Inc., All Rights Reserved ITAMS February,

35 UMS Programs for Analyses and Best Practices Assessments ITOMS Managed on 2-year cycles since 1994, ITOMS (International Transmission Operations and Maintenance Study) with more than 30 global participants. Americas Europe / Middle East / Africa Scandinavia Asia / Pacific ITAMS Managed on 2-year cycles since 2010, ITAMS (International Asset Management Study) with more than 15 global participants. IDAMS Managed on 2-year cycles since 2012, IDAMS (International Distribution Asset Management Study). IDBC Managed on 2-year cycles since 2008, IDBC (International Distribution Benchmarking Consortium). Focus is on finding the optimum between performance (output: reliability, safety etc.) en cost (input). UMS Group Inc., All Rights Reserved ITAMS February,

37 Contacts Johan Huisma Program Manager ITAMS Region Europe UMS Group Europe BV Amstel Business Park Joop Geesinkweg Mobile: Office: Fax: jhuisma@umsgroup.com Olaf van den Berg Executive Account Director Region Europe UMS Group Europe BV Amstel Business Park Joop Geesinkweg Mobile: Office: Fax: ovandenberg@umsgroup.com UMS Group Inc., All Rights Reserved ITAMS February,