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Addressing the ageing of railway infrastructure & rolling stock assets William Wachsmann & Phil Ransom

3 December 2013

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Interfleet – Who we are. Organisation

•  An international rail consultancy with a network of 29 offices across 4 continents. Staff

•  600 core staff, supplemented by extensive international network of associates. History

•  Formed in 1994 from the former InterCity engineering arm of British Railways. •  Management buyout from British Railways in 1996. •  Member of the SNC-Lavalin Group since October 2011

SNC-Lavalin •  one of the top five engineering and construction groups in the world •  major player in the ownership and management of infrastructure. •  the group currently has almost 34,000 staff •  global sales over $8 billion in 2012

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Asset Management System

What should rolling stock owners / operators and railway infrastructure

managers expect from their asset management system?

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What is Asset Management? ISO 55000 “coordinated activities of an organisation to realise value from assets.” Note: Realisation of value will normally involve a balancing of costs, risks, opportunities and performance. ISO55001 provides a framework that explicitly aligns the “top down” corporate objectives with the “bottom up” capabilities of the assets available to deliver those objectives.

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What Asset Management isn’t - examples Opponents Proponents

It is maintenance. Maintenance is one element in an asset’s life cycle. Optimising maintenance alone will not enable optimal performance.

It is a consultant’s marketing tool.

It has been developed in response to industry’s need to get the most from its physical assets and to be able to justify asset related investment decisions.

It is used to justify expensive new IT systems.

Asset Information Management systems are a useful tool in aiding effective AM decisions.

It places finance above engineering.

It allocates scarce resources to where they most benefit the corporate stakeholders.

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Agenda

1.  Application of an asset management system to maintain and enhance railway networks.

2.  Benefits of a robust asset management system maintaining and renewing railway infrastructure.

3.  Benefits of applying asset management principles to rolling stock.

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Maintaining and enhance railway networks.

•  How do we manage the railway infrastructure?

•  Asset Management Framework

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Interfleet Consultants’ Experience with Network Rail - Track

5.5bn  5.5bn  

4.9bn  5.0bn  

4.5bn  4.16bn  

4.0bn  

3.5bn  

3.0bn  

2.5bn  

2.0bn  

1.5bn  

1.0bn  

0.5bn  

0bn  

Circa $2.2bn saved from previous 5 year period ($1=£0.60)

Control period =5 years

£

IIP

SBP

Investment Requirements £300m

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Asset Management Framework for Railway Infrastructure

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Asset Management - Decision Support Framework

•  Step 1 Develop route output requirements ‘A shared vision’

•  Step 2 Develop discipline policies and future volumes of work activities (Criticality / whole of life cost approach)

•  Step 3 Develop detailed discipline work plans (RAMPS) based on policies in 2

•  Step 4 Develop ‘Best Value’ route access plans (Next 5/10 years) based on Infrastructure system approach

•  Step 5 Undertake the work in line with Policies and RAMPS

•  Step 6 Monitor work is delivering outputs anticipated from step 1 System approach

All Disciplines used same approach / Incorporates PAS55 / ISO 55001 principles

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Informed decision making AM questions? •  Do I know what is

required of the asset? •  Do I understand my asset

and how it performs? •  What is the rate of

degradation? •  What is the ‘used life’ /

‘residual life’ of the asset? •  Why would I spend any

money on this?

•  What drives the decision to spend?

•  What needs to be done? •  Value for money? •  What effect does it have

on my operation? •  How can it be done more

cost effectively? •  What are the benefits? •  Is this effective

management of my asset?

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Output and funding specification Context

•  What plans / demands are anticipated for the network?

•  What outputs are required from each route?

•  What constraints will apply?

•  Funding constraints?

Network input and output criteria

•  Traffic flows, tonnages and traction types.

•  Revenue inputs to business.

•  Access periods to undertake inspection, maintenance and renewal.

•  Forward growth patterns.

•  Performance requirements.

The Business strategic requirements

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AM Policy, Specification and Standards

Need to Know •  The asset history and

critically; •  how it degrades; •  the appropriate and

effective interventions to meet the specification.

Asset Description •  Describe the track asset in

detail. •  Divides the principal assets, •  Subdivide these into sub assets

and components. •  Includes age, used and residual

life left in the asset. •  Includes interfaces with other

infrastructure assets, wheel/rail interfaces and rolling stock asset management in a Railway Systems approach.

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Asset History & Criticality History

•  What knowledge have we of the asset history ?

•  What have we learnt from previous experience?

•  What outputs have been achieved from various inputs, i.e. spending, work type activities and volumes etc?

Criticality •  How do we assess the

criticality of the asset? •  Criteria may include

effect of asset failure, cost and disruption to service, ease of replacement and availability of spare components.

•  Route and asset criticality Good asset data is vital to permit fact based decision making.

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Asset Degradation & Inspection Degradation

•  Understanding degradation allows optimised intervene to suit the asset life cycle.

•  Asset degradation mechanisms assessed in terms of impact on safety, costs and performance.

•  Ranking then prioritises each mechanism.

Inspection •  Inspection is key to

managing the infrastructure asset.

•  Inspection monitors degradation.

•  Inspection frequency indentifies degradation before the asset degrades to a critical condition.

•  Control measures. •  Reactive v predictive

inspection regimes.

This enables the AM to set the policies and Standards

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Degradation and the Rate of it is Crucial

When and with what treatment should I intervene to optimise Life Cycle of Asset?

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Asset Intervention Decision Making •  Data driven and fact based decision making. •  Degradation determines what treatments may be

appropriate to optimise the life cycle of the asset. •  Intervention options for each degradation

mechanism may be determined and ranked in terms of their ‘whole of life cost’ value.

•  Frequent minimal intervention v effective life extension work or renewal.

•  Phase the interventions to optimise the plan –  Maintenance to keep the asset functional –  Life extension by targeting renewal –  Bundling work to coincide with upgrading

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What is the Best Intervention

Patch the Surface?

Repair whole of

LX surface

Renew LX completely

Depends on residual age / rate of degradation / condition / criticality and required outputs

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Railway Infrastructure System: Interdependencies

Need to address as

part of asset management

regime

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Monitoring and Review Monitoring and

Review •  Monitoring is essential for

business performance and asset management review.

•  The Asset Management Framework is in essence a ‘Plan – do – Review’ cycle.

•  Asset Managers adjust the policy as understanding of asset performance grows.

Enablers •  Key enablers include:

–  Asset Information –  Analysis Tools –  Decision support tools –  Processes –  Competence

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Review of the Asset Management Policy

Driven by •  A change of traffic demand

changes criticality •  To allow model refinement •  To capture degradation

information •  Changes of network/route/

asset objectives •  Funding changes

Outcome •  Adjusted Asset

Management Policy to suit changed requirements.

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In conclusion

Good asset management makes sense!

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Practical Asset Management Framework for Rolling Stock

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Organisational Objectives and Strategy • Rolling stock owner’s / operator’s

vision, mission, organisational objectives, and strategy.

• Stakeholder requirements •  Internal and external business

drivers. • The asset management system is

primarily designed to support the organisational objectives and strategy.

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1. Leadership and AM Policy

•  Asset management (AM) policy •  Organisational structure. •  The AM Policy assists in

aligning organisational objectives, organisational strategic plan and the rolling stock AM objectives.

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2. AM Objectives and Strategy

•  Strategic Asset Management Plan. Rolling stock objectives and the strategy for rolling stock management aligned with organisational / corporate objectives.

•  External environment and internal factors faced by the organisation.

•  Competing options are examined. •  Integrate with other organisational

functions such as quality (ISO9001), accounting, safety, risk, procurement, and HR.

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3. Asset management plans for rolling stock classes •  AM Plans for individual classes of

rolling stock •  Whole of life cost criteria are used

when analysing competing options •  Impact of the rolling stock on the

whole railway system •  Risk assessment •  Contingency plans •  Programme for activities → long term

forecast of cashflows •  Key Performance Indicators (KPIs)

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4. Support

1.  Resources – People and tools / facilities

2.  Competence 3.  Awareness of the AM system 4.  Communication 5.  Asset Information Management

System

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5. Implementation of AM Plans

Implementation requires control of activities across the asset life cycle. This includes:

•  acquisition or enhancement •  utilisation •  maintenance •  de-commissioning / disposal.

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6. Performance evaluation and improvement •  Monitoring of KPIs – financial and

technical •  Performance of the assets - the extent

to which the AM objectives are met •  Compliance with legal and regulatory

requirements •  Performance of the AM system •  Failures, incidents and non-

conformances.

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7. Management review •  Inputs to management reviews include:

–  Performance of the assets with respect to objectives

–  Legal and regulatory compliance –  Incident investigations

•  Outputs from management reviews include: –  Variations to policy and objectives –  Changes in resources

•  May lead to amendments to the organisational strategic plan.

This final step allows top management to assess whether the asset management policy, objectives and strategy continue to align with corporate objectives.

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Benefits of Asset Management

What should rolling stock owners / operators and railway infrastructure managers expect from their asset management system?

In summary •  Alignment of AM Objectives with Corporate Objectives. •  Optimisation of whole of life costs and operational

performance – balancing risk, cost and performance. •  Improved long term cash flow forecasting. •  Demonstration of good governance and risk management. •  Evidence of legal and regulatory compliance.

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Strategic Asset Management

Thank you for your attention.

Any questions?