The IDS Business Model – NZ’s Asset Management Success Story Revealed (Video)

Transcription

Good morning. It’s Ross Waugh here from Inframanage.com with David Fraser and Theuns Henning. And we’re continuing our discussion around IDS.

In this particular video, we are going to be talking about the vision that IDS had when it was first set up in the late 1990s and just how it’s developed in some of the key attributes that IDS have that are quite different from other models that have been run for this sort of outputs.

Ross:   So David, could you talk to us about just the overall setup of IDS and also how you’ve partnered with a provider and how successful that’s been.

David:  Okay Ross. Ross, the exciting thing about IDS and the original concept envisioned was that we were seeking to make advance asset management tools available to every unit of local government in New Zealand, irrespective of their size.

So we wanted those who are aspiring to become really good asset managers to have these tools available to them that you know, in normal circumstances the council was not been able to afford.

And Deighton saw what we’re trying to do and they came on board and really helped us facilitate that. We were able to get into a collective arrangement not only within New Zealand but with Deighton’s and actually really provide these opportunities across the country.

Ross:   And David, my observation in the last 18 years is that Deighton’s have been a very active partner in this relationship. And they put a lot of effort, a lot of the senior staff, executives, owners even (who are) quite committed to this relationship with New Zealand.

Do you just want to give us a bit more of an insight into that?

David: Yes Ross I couldn’t speak highly enough of the approach that Deighton has taken to this. I think we are actually quite different to some of the other parts of the world where they operate.

And they’ve seen that they can really help us but I think they also see that we provide some opportunities and some experiences that they perhaps won’t get elsewhere. And Deighton is a very interactive, involving type of company.

They run user conferences each year where we can go and participate and we can give them feedback of the things that we see would improve not only our performance but also would improve the product they provide, and they’re very open to suggestions. They’re fantastic to work with.

Ross:   That’s quite…. Every software vendor my observation does a lot of work in that area obviously, make those promises so it’s quite refreshing to hear good feedback about one that delivers on those promises.

Theuns, another thing that’s quite unique about the IDS arrangement is the consortium. And that’s a consulting consortium. Can you just unpack that a little bit for us?

Theuns: Ross, yes we often get envied by the rest of the world, technical sectors about what we have achieved in this regard. Initially, the project was rolled up by one company but then two years after that, consortium of consulting engineers and contractors, everybody basically participating in this project has got to sit around the table, and we share technical developments amongst us. When we go out to clients, we will compete fiercely but when we get into the room, we actually work well together. So I think that’s quite unique.

David: Can I just add a little bit to that. One of the strengths of the consortium is New Zealand is quite a small country. And sometimes these conflicts of interest or some of those issues, which the consortium gives us the ability to work our way past those in some situations.

Ross:   It does. And just for viewers from larger countries in the Northern Hemisphere, New Zealand engineering is a very small team. The senior people you’re talking less than a hundred and we all know each other.

And we will meet quite regularly at conferences and within the consortium. So one of the real advantages of the IDS consortium is it’s been able to be managed at the senior level to get past the inevitable questions around engagement and IP and things like that.

So Theuns, could you talk to us, within the consortium and IDS, how’s the intellectual property handled there. This is always a concern around these sorts of things. So…

Theuns: It’s correct Ross. The business model is that we have the license to use the Deighton software which is a vehicle for the intellectual property that we have developed in New Zealand.

Initially, we’ve adopted the full World Bank HDM philosophy and approach and even some of the deterioration models that came from the World Bank. Later, over time, we’ve done our own research, our own developments and we’ve incorporated that base practice into the IP that we have.

So if you want to think about it, it’s almost like Microsoft Excel with we have developed a very special spreadsheet that is owned by the New Zealand industry.

Ross:   Well thank you for that conversation Theuns and David.

And if you want more information particularly about that part of the model, we’ll put some links in under the video. Also, the IDS website has the additional information about that.

Thank you for watching this video. And we look forward to seeing you on the next one.