In the previous post, Ross mentioned about getting that bigger picture planning going that would help in forming the shorter-term plans.
Heather explains further:
And that ties right back into our managing assets into asset management conversation because we’re just so focused on managing that treatment plant, we may make a huge investment in replacing something or dealing with those assets, we’re going to take them out and move them five or ten years down the road.
And I actually worked with a utility, there was in this situation where it was a hotel, but it was a water utility that served this hotel. And they were looking at selling the hotel and not being in a hotel business in about a seven-year period.
So that completely changed the way they were operating and maintaining that system from, when we had visited them a couple of years prior and that wasn’t the goal at that point but now they are going to change, and they were, kind of at this point where we are only going to be here about seven more years.
So, that completely changed the dynamic at the strategic level of where do you make your investment. You can’t ignore the system. You still have seven years but your strategic investments might look a little bit different because…
Yes, you’re not going to replace all those pipes, so you just have to maintain them.
We’re going to make different choices, O & M-wise versus replacement. Only replacing the key absolutely necessary stuff. So, again looking at it in a more strategic direction from their perspective.
We’re not going to be doing this after seven years, so let’s manage the system with that as overarching sort of thing that we have to work with and then that changes how you do things if you’re just at the asset level again, you would continue to maintain this asset as you were before and you wouldn’t have that big picture look.
So, again the big picture gives you the chance to say, well, will I change anything at the individual asset level, given the big picture that I have.
So that’s again, I just can’t stress enough how important it is to have both, to have that big picture look and then, a focus on what should be the asset management or operation and maintenance task that you do on an individual asset. So to have both is the really key feature.
And look it calls to mind a quite a small town in New Zealand that has maybe 3,000 population and they supply water to a massive big milk processing plant that was located in their town.
So, half the supply or more than half was just going to this treatment plant, so the milk processing plant, big industrial plant. A lot of the income for the town was coming through that plant.
And I said to them, well, do you know what they want and what changes that they’ve got. Oh no.
Well, do you talk to them?
We haven’t talked to them in 5 years.
I just said to them, look, you know, because I do consulting, I said If I had one client that was 50 percent of my income I suspect I would talk to them more often than once every 5 years.
Said, yes that’s a really good idea, we should go and talk to these guys and find out if they are going to be growing if they want more water off us, are they going to be changing standards soon.
And so, I think one of the things, just being aware of what’s changing around your town. A big new healthcare facility that creates new demand or a whole lot of new infrastructure that you need to get there.
A big industrial process coming into your area could change stuff particularly if you are supplying them and or taking stuff, you know, a wastewater out of there.
And you can just stay on top of that sort of that stuff and that means you’ve got to keep your ear on the ground and keep talking to the people that are in charge of those sorts of decisions and that helps inform again, might change the way you think about how you are managing your network, we are going to need new, big new parts of it. It can change a lot of stuff quite quickly.
In any community, that somebody is going to spend 2 or 3 or 4 hundred million dollars on a big healthcare facility, you are not going to say no normally.
You want to be saying, hey, how do we make that happen and how do we facilitate that, but they can change your asset mix in the process as well.