Compliance in water asset delivery

Benchmark Estimating Software

By Frank Prestipino, Head of Growth, Benchmark Estimating Software
Friday, 01 September, 2023

Compliance in water asset delivery

Water is essential for life, and clean water is vital for health. Prior to the creation of today’s water treatment and distribution systems, deadly outbreaks of waterborne diseases were frequent.

Today, in developed countries, most people take the supply of clean water and wastewater treatment for granted — but water safety and security rely on a complex and costly set of assets.

These assets must be highly maintained and expanded to ensure they are resilient and able to meet an ever-growing demand. Increasingly they must be designed to have as little environmental impact as possible.

Australia’s water utilities face significant and growing challenges in meeting these goals. Infrastructure Australia’s October 2021 National Study of Infrastructure Risk report found emerging water and waste treatment technology had introduced complexities to projects during option selection and commissioning.

It also identified workforce shortage and contractor availability, national policy uncertainty and complex governance arrangements as critical industry risks.

To keep the water infrastructure operating reliably and meeting expected demand, every water utility must identify which assets can be repaired, which can be rebuilt and what new assets must be added. It will answer these questions as accurately as possible to ensure funding is available to achieve its goals.

This means the cost of every anticipated rebuild, repair or replacement needs to be estimated as accurately as possible to allow for better planning and management. To achieve this, every utility manager needs to adhere to a cost-estimating process that is reliable, efficient and as accurate as it can be, given there will always be unforeseen changes impacting costs.

Conquering the challenges of utility management planning

Those responsible for delivering infrastructure assets face significant challenges, which is expected for major investments.

In the case of public infrastructure, there will always be a high level of government scrutiny and accountability and the risk of significant cost overruns garnering unfavourable and unwelcome media attention. These challenges must be met and overcome at each stage of a project.

Pre-investment planning. This involves conducting thorough research and analysis prior to making an investment decision. It involves gathering and evaluating relevant information, assessing risks and potential returns, and formulating a strategy to guide investment decisions.

Exploring options. This requires the in-depth consideration of various alternatives and options for meeting infrastructure requirements to find the most cost-effective solution.

Concept design. This is the initial phase of a design process where different alternatives for meeting the identified requirements for an asset are generated and explored. The primary goal is to develop and communicate a vision that will form the foundation of the final design.

Budget. This is a critical and complex phase because it requires estimating and allocating financial resources to cover the costs of planning, design, construction, operation and maintenance of the infrastructure project.

Once the project is underway, it involves forecasting and managing expenses to ensure the project can be completed within the available funding.

Detailed design. This involves the development of comprehensive and precise design plans and specifications that translate the concept design into technical drawings, calculations and specifications that enable the project to be realised as intended.

Procurement. This is the process of acquiring goods, services and labour required for the development and construction of an infrastructure asset. It requires suppliers’ and contractors’ identification, evaluation, selection and contracting to complete the project according to specifications.

Out-turn costs. These are the actual total construction costs calculated at the end of the project. Accurately calculating these will require collecting and validating large amounts of data from multiple sources.

Streamlining planning and cost estimating for successful funding

Achieving asset delivery efficiently, effectively and within budget is long and complex because it embraces many different roles and functions within a water utility.

At every step, there is an opportunity for miscommunication, error and omissions that will accumulate, challenging the utility’s ability to deliver infrastructure on time and budget.

What is needed is an end-to-end cost estimating solution that can act as a single repository of data throughout the project.

It must be easy to use by all staff involved in the project, no matter what their role. And it must enable them to input data and get an accurate and up-to-date view of every aspect of the project requiring their input.

Such a solution will spread the budgeting burden across all departments rather than it being the sole responsibility of the finance department. It will greatly facilitate communication and collaboration between all individuals involved in asset delivery.

Shared access to a common, trusted dataset will enhance collaboration between all teams and individuals throughout a project’s lifecycle. This will lead to more informed and, therefore, better decision-making.

Having a single repository for all data associated with a project will greatly facilitate a utility’s ability to control and secure that data.

The data required for an effective cost-estimating solution will come from many sources. So, it is important any solution is able to interface and integrate with other systems that generate and require data associated with a project.

The solution must also quickly generate critical metrics on a project: the accuracy of cost estimates, the time required to produce those estimates and identifying ways to improve the process.

Finally, in today’s world, change is constant. Any cost-estimating solution must receive regular updates and be constantly improved to meet evolving user demands and legal and regulatory requirements.

Like all modern, multi-user software, it should be cloud-based to facilitate multi-user access and upgradeability.

A cost-estimating solution can transform a utility into an agile data-driven organisation, one able to make accurate and informed decisions on infrastructure project costs and rapidly adapt to changes that impact those costs.

It can significantly simplify the complex task of budgeting, free staff from the challenges of working with legacy solutions and greatly reduce the risk of errors.

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