Asset Management Policy, Strategy and Planning

What this module covers

Module 2 carries 10 questions, so six wrong answers here end the attempt however well you do elsewhere. Its centre of gravity is the difference between three documents that sit one below another and are easy to confuse.

Policy, strategy and plan

The asset management policy is short, high-level and authorised by top management. It sets out principles and commitments, for example that investment decisions will be made on a whole-life basis. It contains no targets, no activities and no maintenance intervals. If changing one interval would mean reissuing the policy, the policy is holding detail it should never have had.

The strategic asset management plan is the hinge. It turns organisational objectives into asset management objectives and sets out the approach that the plans beneath it will follow. An organisation normally has one of these.

Asset management plans are operational and specific. For a particular asset or group of assets, they set out the activities, resources and timescales needed to meet the asset management objectives. An organisation normally has several. A plan that lists activities and dates without the resources to deliver them is not a credible plan.

Objectives that can be measured

An objective you cannot measure cannot be evaluated, and one you cannot evaluate cannot drive improvement or give assurance. "Improve the network" is an aspiration. "Reduce unplanned interruptions by 15 per cent within three years against the 2025 baseline" is an objective. Watch for questions that offer activity targets, such as doing more preventive maintenance, dressed up as outcomes.

Levels of service and demand

Levels of service turn stakeholder needs into commitments specific enough to plan against. Examples are availability, response times and quality. They sit between what stakeholders expect and what the assets must do.

Demand analysis looks at the external drivers of future need. These include population and housing growth, changes in usage, climate and weather, and new legislation. Last year's figure carried forward is not a forecast. Where uncertainty is real, good practice is to plan across a range of scenarios and compare the whole-life cost and risk of each, rather than betting on a single forecast and noting the uncertainty in a register.

Horizons, prioritisation and review

A planning horizon set by the funding cycle hides everything beyond it. Plans should look far enough ahead to show that the planned pattern of investment can be sustained over the life of the assets. When justified work exceeds the budget, prioritise on the contribution each option makes to objectives, weighed against its cost and the risk of not doing it. Asset age and an equal split between regions are not good grounds. Revisit the SAMP when organisational objectives change, because everything below it is aligned to them.

Where marks are lost

• Placing objectives in the policy, or principles in the SAMP
• Choosing activity targets over measurable outcomes
• Treating a single demand forecast as sufficient when the uncertainty is material
• Setting the planning horizon by the budget cycle rather than by asset lives
• Forgetting that capital and operating plans affect each other across the asset's life