6 Secrets

As the Secrets were being developed, it was discovered all the barriers to infrastructure development mentioned in “The Overview” could be resolved by focusing on two questions:

  • Who should serve as the Asset Champion?
  • What format do you roll out any infrastructure planning process?

Asset Champion

As the Secrets evolved, the attributes for the Asset Champion evolved with it. The Asset Champion needs to:

  • Be unbiased and consistent in all its interactions with ALL stakeholders to the infrastructure asset
  • Treat all stakeholders to an asset with an even-hand
  • Focus on providing the best solution without bias for technology
  • Supervise the testing and design of all technology solutions without bias
  • Have an extensive background in development, design, build, finance, operation, and maintenance of infrastructure assets.
  • Perform all development, design, build, finance, operation, and maintenance without bias to any one stakeholder or solution.
  • Have the time, knowledge, and capacity to commit to the successful implementation of any infrastructure plan, knowing the time frame for oversite could extend for up to 30 or more years
  • Have the time, knowledge, and capacity to commit to work with government regulators
  • Have the time, knowledge, and capacity to commit to search, source, and work with a variety and types of funding alternatives

 

Format for Rollout

The format had to provide an environment which could:

  • Provide oversite to an infrastructure asset for its full useful life. This could extend up to 30 or more years
  • Bring the brightest minds together to solve complex infrastructure problems in a non-competitive manner
  • Facilitate the numerous transactions to an asset in a transparent and timely manner
  • Facilitate the ongoing monitoring and feedback mechanisms necessary to maximize the performance of an asset for its full useful life without bias
  • Provide procurement processes customized for each public sector organization, which satisfies all necessary bylaws, regulations, and procedures of that organization.
  • Facilitate flexible and attractive funding alternatives to a variety of asset types and sizes
  • Facilitate attractive pricing for contractors and vendors, which not available anywhere else
  • Facilitate project results on-time and under budget
  • Facilitate and encourage continual improvement in process, risk mitigation, and asset sustainability

 

Potential Solutions

Even if a public sector organization finds ways to overcome the limitations of “silo-effect” problem solving, most organizations still lack the experience and understanding of infrastructure to be able to effectively make risk mitigation and sustainability plans.  They also lack the in-house experience with infrastructure projects to be able to simplify the process down into smaller “bite-size” components to make decisions faster and easier. For so many reasons, an in-house Asset Champion does not satisfy the rigorous requirements to manage these assets for up to 30 years.

 

Many people who have construction project experience may think that an engineer or general contractor could fulfill at least the Asset Champion role.  Unfortunately, their perspective is much too limiting. As both engineers and contractors are part of for-profit entities hired by a stakeholder to the project, an engineer or general contractor will have competing objectives to many of the stakeholders to the infrastructure asset and will not be able to remain unbiased.  For a variety of reasons, the engineer and general contractor cannot fulfill the numerous rigorous requirements necessary for implementing the 6 Secrets.

 

IGNITE Infrastructure Association

Historically, for-profit entities such as consultants and large contracting firms have dominated infrastructure, which are for-profit entities. The mandate of for-profit entities is to make profit, which is not always in alignment with the best interest of taxpayers and other stakeholders to an infrastructure asset.

As research into the 6 Secrets evolved, it became clear the two questions could be satisfied with one solution. An independent, member-based, nonprofit known as IGNITE Infrastructure Association Inc was created to act as the Asset Champion and the mechanism to roll-out the infrastructure plan. Only a member-based, nonprofit entity, whose sole focus was infrastructure assets, could satisfy these very rigorous requirements.

The mandate of IGNITE focuses on performing all activities solely to serve its members. Its members are the public sector organizations and the organizations which work with infrastructure such as engineers, funders, vendors, and contractors. IGNITE acts as the “glue” between government departments and other stakeholders. As it is the purpose of IGNITE to serve all its members fairly, it treats all these stakeholders to an infrastructure plan with an even-hand. Using this approach, the public sector organization aligns much better with taxpayer needs of maximizing value and minimizing cost. Only a nonprofit entity avoids conflict of interest and can treat all parties with an even hand.

These secrets were developed, field-tested, and proven to work during the last 10 years. Check out more information on IGNITE.

The Secrets: 1, 2, 3, 4, 5, 6


Key to all these secrets is the infrastructure plan must be simple to adopt and easy to get started or else it will not be adopted. There are massive backlogs of infrastructure projects waiting to be developed and literally billions of dollars waiting to invest in the infrastructure sector. Lack of diagnostic tools and resources available to both public sector organizations and project funders have made infrastructure decisions difficult.  Many projects never “get off the ground” because public sector officials and funders simply do not have the diagnostic tools to make timely decisions. Simplifying and standardizing the process and providing diagnostic tools removes apprehension and improves decision-making processes.  Infrastructure Asset Champions need to bring all stakeholders together to make the process work for all and through collaboration ensure the asset management plan is both simple to adopt and easy to get started.

Simplifying the Plan

The Asset Champion in collaboration with the Project Team might consider some of the following to make the public sector organization infrastructure plan easier to adopt:

  • The long-term infrastructure plan must be very high level and include a list of infrastructure priorities for the public sector organization
  • The Project Team needs to be authorized by the public sector organization to make simple project decisions on behalf of the public sector organization
  • Daily administrative decisions affecting the infrastructure plan implementation, operation, and maintenance must flow through the Project Team.
  • Project Team decisions must be made in a timely manner as directed by the Asset Champion
  • The Plan must be broken down into simple to implement components
  • When the Project Team meets, the Asset Champion provides a very short-term, simple action plan, often with alternative courses of action. The Asset Champion normally provides explanation to the Project Team. Through a collaborative process, the Champion guides the Project Team to make the most suitable choice. Once “go-forward” steps are determined, the Asset Champion and the Project Team leave the meeting with action points for next steps on the plan. This process is repeated many times. Through this collaborative process, the Asset Champion educates and counsels the Project Team prior to decisions being made. This encourages an atmosphere of trust and capacity building.

The preceding is not exhaustive but illustrates what can be done to simplify an infrastructure action plan. It may appear intuitive, but it is a lot of work.

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One of the most pressing issues among public sector organizations is the development of new infrastructure funding models to modernize the way these organizations fund themselves. Funding is probably the most challenging aspect of infrastructure planning. In past years, much public infrastructure was funded through the issuance of debt instruments. With stubbornly low interest rates prevailing for much of the last 20 years, long-term debt markets are not an attractive investment. With the constrained budgets of provincial and federal governments, many public sector organizations depending on government funding need to consider other funding models, even if it means doing something new.

Considerations

When considering funding alternatives for an infrastructure asset, the Project Team must consider some or all the following variables in its analysis:

  • the size of the asset
  • the useful life of the asset
  • the length of time the asset will be kept
  • renewal or expansion of an asset
  • credit worthiness of the public sector organization
  • whether it needs to own the asset
  • how much risk the public sector organization is willing to assume

Once the Project Team has determined the funding requirements for its infrastructure plan, it can use this as a strategy to source funding. Thankfully, new sources of funding, which are eager to invest in the right type of infrastructure assets, have developed during the last several years.

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Planning for the long-term is a relatively new concept for many public sector organizations. During the last several decades, various groups have promoted its importance to organizations of all sizes. Although it is encouraging public sector organizations are becoming aware of the need for long-term planning for infrastructure, to ensure the truly, long-term success of an infrastructure plan, the Asset Champion must direct the Project Team to focus on sustainability and risk mitigation at each phase of the asset’s useful life.

Sustainability

For an infrastructure asset to be truly sustainable, it must provide significant energy, economic environmental, and educational benefits to all stakeholders associated with the asset. Sustainability goals need to be defined by the Project Team under the guidance of the Asset Champion early in the infrastructure planning process. The Asset Champion assists the Project Team to adopt and ultimately satisfy the agreed upon sustainability goals through the implementation of the organization’s infrastructure plan. Part of a sustainable asset plan must also include budgets which are predictable, affordable, and planned years in advance.

Risk Mitigation

Managing infrastructure assets involves significant risk. To ensure the success of an infrastructure plan, the Project Team must focus on managing or mitigating as much of this risk as possible. The Project Team under the direction of the Asset Champion must develop a risk mitigation strategy for all stages of the useful life of an asset. To ensure the effectiveness of a risk mitigation strategy, asset risk must continually be monitored and assessed.

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The successful long-term launch and management of assets includes an overwhelming number of choices and issues to address. To properly manage these assets, decision-making project teams (Project Teams) need to be selected, and designated champions (Asset Champions) need to direct these teams. Through a process of collaboration, this team should develop an infrastructure plan for each asset. To encourage effective management and to ensure the infrastructure plan remains on track, the champion needs to direct the project team to separate complex plans into many “bite-sized” components and attain a forward-moving consensus at each meeting through a process of collaboration amongst a cross-section of stakeholders. The champion should always direct these meetings in an unbiased manner.

 

Project Team Meeting

By adopting this collaborative and “bite-sized” strategy, the Project Team focuses on developing a short-term manageable action plan under the direction of the Asset Champion. As it is the duty of the Asset Champion to remain neutral and unbiased, the Champion neither approves nor disapproves Project Team choices. Rather, the main duty of the Champion is to encourage a dialogue between stakeholders and to ensure no one leaves the meeting without a short-term action plan to execute prior to the next meeting.  Through this collaborative, “bite-sized” approach, the Asset Champion can guide the team project through a series of meetings to successfully launch and manage these complex initiatives.

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The development, design, build, finance, long-term operation and maintenance of public infrastructure is complex, time-consuming, often requires very specific skills, and involves many stakeholders with competing interests. Increasingly, public sector organizations are looking for ways to more effectively launch and manage infrastructure assets for their complete useful life.

There are entrenched “ways of doing business” by many public organizations to renew, expand, operate, and maintain infrastructure assets. Unfortunately, these methods are not providing the results many organizations require. New ways of looking at infrastructure are needed even if “we have never done it this way before”.

 

 

The New Paradigm 

The design, development, build, finance, operation, and maintenance of infrastructure assets is a complex process. To address this complexity, a paradigm shift in how to approach infrastructure is necessary. The new paradigm requires:

  1. Stakeholders viewed as partners – There are numerous stakeholders who will be involved in the entire life-cycle of an asset. Stakeholders to the asset include individuals and in some case organizations within and external to the public sector entity. Within the public sector organization, it includes administrators, infrastructure specialists, engineers, legal, accounting, and senior decision-makers. External to the public sector organization, it includes for-profit vendors and contractors, funding groups, professionals such as legal and accounting, and regulators. In the past, these various groups viewed each other in a “us vs them” mentality. The new paradigm views each stakeholder as a partner to the infrastructure asset. By adopting this approach, the emphasis is on fair treatment for all partners.
  2. Transparency – By encouraging transparency in all transactions between the various partner stakeholders to an asset, it creates an atmosphere of trust. This encourages long-term and deep partnerships between the various stakeholders. For funding groups, transparency lessens misunderstanding and mitigates risk in their initial underwriting process. For vendors and contractors, a transparent, open, honest approach to solution providing results in procurement processes whose focus in on the best solutions rather than lowest cost. For senior decision-makers, transparency means better information to make long-term decisions.
  3. Long-term perspective – By planning for the full life of an asset, stakeholders look for ways to create sustainability and financial viability of the asset.

 

It is this paradigm which sets the stage for public sector entities to thrive with infrastructure in the 21st century.  All other secrets require Secret 1 to be in place and effective, prior to moving forward.

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Public sector organizations in many places around the globe are looking for better ways to manage, improve, or modernize their infrastructure assets often while budgets have been shrinking. Efficiencies and asset management have improved over the years, but largely the infrastructure sector has operated much the same for over 100 years. Without the sector reinventing itself, many public sector organizations will find it increasingly difficult to meet the challenges of managing infrastructure in the 21st century.

Perhaps the primary barrier to renewing or expanding community infrastructure is financial. Many public sector organizations:

  • Lack their own capital to renew or expand their infrastructure
  • Lack the financial strength to attract capital via lenders without government guarantees
  • May find it difficult to raise capital even if they are stronger financially, because many lenders either do not want to fund infrastructure or do not provide competitive rates for renewal or expansion infrastructure projects