A recipe for good asset management decisions – Part 6

This is the sixth and final in a series of posts from the AWA’s Asset Management Specialist Network. Read part one, part two and part three, part four and part five.

Imagine if you received your water bill from your utility with, just under the total amount due, the following detailed cost breakdown:

• Water Variable Usage Charges
• Water Fixed Access Charges
• Sub-Optimal Asset Management Decision Charges

Inconvenient truth?

Considering all available options with an open mind and creativity

Three old sludge dewatering centrifuges were causing a lot of trouble to a plant's operation. Their poor performance and frequent failures were generating significant sludge transportation costs in addition to the increasingly expensive corrective maintenance. They were installed 23 years ago when the plant was commissioned and getting spare parts was becoming increasingly challenging.

The decision to replace the three old centrifuges with new equivalent ones was a no brainer for John the asset manager. It is however always beneficial to challenge the obvious conclusion with questions such as: are the alternatives only limited to replace or not? What if replacing the three centrifuges with two larger ones provided a better total cost? What about reducing the dewatering capacity and operating them 7 hours per day instead of 5? What about belt press, screw press or filter press technologies? This design might have been the optimal option 23 years ago, but what if better technologies were available today? What about a technology, such as piston press, that would enable a higher sludge dryness and generate less volumes to transport and dispose?

This decision is not just about a renewal expenditure, it’s also about 20 or 25 years of sludge transportation and disposal, of polymer consumption, of preventative and corrective maintenance, of operation labour and energy. When all these costs are included in the equation, we realise that the decision stakes are bigger than what they look like and investing a bit of time to consider the available options and conduct a high-level assessment might be worth it.

A decision can’t be better than the best option considered. A typical cause of sub-optimal decision making is the failure to consider all the good options available. Asset managers make decisions under time pressure and lack of information. These circumstances often lead them to use a satisficing approach to decision making, which basically consists of going for the first acceptable option that comes to mind.

The asset manager should develop a habit of systematically considering all available options even for everyday decisions. High stake decisions deserve even more effort to identify the available alternatives with an open and creative mind, and acquire the information required to conduct an objective assessment.

'Mind opening' strategies likely to bring positive outcomes include brain storming sessions, databases of lessons learnt from past experiences, innovation management, and exchanges with peers (conferences, professional associations, etc.).

If you have any questions about the Asset Management Decision Series, please contact Zoubir Ait Mansour, Marion Derochet or Norbert Schaeper.

This article was written on behalf of the AWA’s Asset Management Specialist Network.