Framework for the development of performance ...

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Framework for the development of performance measures for sustainable asset management practice in road transportation W. P. H. Gunarathna, R. A. Hassan & J. Lamborn Faculty of Engineering and Industrial Science, Swinburne University of Technology, Australia

Abstract The road transportation sector in many countries is faced with the need to simultaneously address two overarching challenges; the need to undertake effective asset management, with the broader need to develop business processes, while embracing sustainability principles. This paper presents a systematic approach for integrating sustainability principles into road asset management practice using performance measures. The key feature of this approach is that it moves away from the traditional approach of a road asset management perspective concerned with physical assets, and instead promotes a holistic view of all tangible and intangible assets relevant to road transport. Additionally, the sustainability evaluation has been extended to cover six relevant dimensions including economic, financial, technological, social, corporate and environmental. The paper also presents a framework for a sustainability performance measurement that can be used by road agencies to assess and monitor the performance of their asset management practice in a systematic manner. The proposed framework includes a set of goals, relevant to road transport asset management (RTAM), for each of the six sustainability dimensions. Each goal is further defined by a set of objectives, indicators, and performance measures that are relevant to the different aspects of RTAM. Keywords: performance measure, road asset management, sustainable transportation, multidimensional sustainability.

WIT Transactions on The Built Environment, Vol 130, © 2013 WIT Press www.witpress.com, ISSN 1743-3509 (on-line) doi:10.2495/UT130551

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1 Introduction Asset management has been playing a major role in the business world and changing shape in different ways in response to challenges. Among these challenges, sustainable development has become a guiding principle for the transportation industry worldwide. Emerging climate change, resource shortages, financial limitations and increased energy costs are creating a global challenge and a growing need to adopt a sustainable asset management practice. The aim of this study is to integrate sustainability concepts into the framework of RTAM to improve sustainability performance within the Australian road transport industry. The main objective of this study is to identify and develop performance indicators and relevant measures to assess and monitor sustainability performance of RTAM practice. A key aspect is the development of a sustainable performance measurement framework to incorporate performance measures relevant to each phase of the asset management framework. These measures will ensure that asset management practice is sustainable in every aspect and that potential risks are well managed in every phase of the asset management process. The proposed framework addresses the sustainability of all assets including physical, human, financial, information, and intangible assets, which are important aspects of an integrated RTAM. Further, it adopts a multidimensional sustainability concept and includes six dimensions of sustainability namely; environmental, social, economic, corporate, financial, and technological.

2 Integrating a sustainability concept into the RTAM framework Presented in this section is the systematic approach adopted in this study to integrate sustainability principles into the asset management process of RTAM. It starts with the definitions adopted for sustainability and road asset management. 2.1 Definition for asset management The definitions within ‘Asset Management’ and ‘Transport Asset Management’ adopted by road agencies vary and change over time. For this study, the British Standard Institute Publically Available Specification (BSI PAS-55) definition has been adopted, which provides a more focused definition for quantifiable businesses and services than those reported in [1–4]. It states the following: “asset management is systematic and coordinated activities and practices through which an organization optimally and sustainably manages its assets and asset systems, their associated performance, risks, and expenditures over their life cycles for the purpose of achieving its organizational strategic plan” [5]. The PAS-55 definition implies that there are another four categories of assets that have to be managed in order to achieve an organization’s strategic plan than the

WIT Transactions on The Built Environment, Vol 130, © 2013 WIT Press www.witpress.com, ISSN 1743-3509 (on-line)

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physical assets. These categories are the human, financial, intangible, and information assets, which can be explained as follows [5].  Human assets – including corporate assets such as ownership, managers, employees, contractors and suppliers, motivation, communication, roles and responsibilities, knowledge, experience, leadership and team work.  Intangible assets – social impacts, reputation, image, morals and constraints.  Financial assets – life cycle cost, capital investment criteria, operation cost, value of asset performance  Information assets – condition, performance, activity and cost and opportunity assets. 2.2 Multidimensional sustainability for RTAM Zietsman and Rilett [6] proposed a definition for sustainable development that addresses the basic principles of sustainability related to transportation. These principles are described below and have been taken into account at all stages of this study, particularly in the development of the sustainable performance measurement framework.  Intergenerational equity – there should be an equal distribution of resources between communities and generations to fulfill current and future requirements.  Multidimensional – social equity, economic development and environmental stewardship are interrelated and must be simultaneously addressed.  Dynamic – necessary to adapt the changing needs of societies and generations over time.  Continuum – sustainability is not represented by a discrete indication and it should be integrated into each of the others by various degrees of sustainability. Sustainability principles need to be combined with key principles and attributes of the asset management for better sustainability performance. Since the definition of asset management adopted in this study promotes a holistic view of all a system’s assets then sustainability of RTAM performance can be considered multidimensional. The proposed six sustainability dimensions include the following with adopted definitions: Environmental sustainability – it involves protecting natural resources, minimizing waste and air pollution, and maintaining of a variety of species and habitat through the RTAM process. This includes:  minimizing resource consumption by improving material reuse and recycling, and by efficient usage;  limiting air pollution and noise pollution;  minimizing waste accumulation;  reducing the impact of transportation activities on the ecological system. Social sustainability – it is the ability of a community to provide a safe and healthy environment, while providing equitable and affordable services for their development. This includes:  providing a safe, secure and healthy environment; WIT Transactions on The Built Environment, Vol 130, © 2013 WIT Press www.witpress.com, ISSN 1743-3509 (on-line)

688 Urban Transport XIX  maintaining equitable opportunities within different social levels, and providing affordable transport services;  increasing community development by satisfying the basic accessibility needs of a society and its individuals. Economic sustainability – it is concerned with the productivity of the asset systems for efficient services, improvement and economic development. This includes:  building a transport system that is resilient in the face of climate change risks;  providing efficient services;  improving local development;  providing an economically feasible and affordable transport system. Corporate sustainability – it is concerned with stakeholder satisfaction and the implementation of a sustainable culture within the organization. This includes: staff motivation and improvement of a target workforce within the organization;  valuing and developing the competence and capabilities of staff;  enhancing leadership and stakeholder relationships;  implementing sustainable practices and regularly assessing cultures within the organization. Financial sustainability – it is focused on investing in long and short-term resilience to key drivers of change. This includes:  forecasting different financial needs and reserve funding;  maximizing value for money for all stakeholders;  minimizing unexpected financial shocks due to disaster situations. Technological sustainability – it is focused on advancing technology in the asset management system and minimizing the use of obsolete technology. This includes:  partnering with client and key stakeholders to create or find innovative products and processes for sustainable transport solutions.;  improving the technological capabilities of an organization’s assets. 2.3 Integrating sustainability concepts with the RTAM framework To integrate principles of sustainability into the asset management process, the following steps were followed: 1. All processes and relevant tasks of RTAM practice were identified. 2. The risks associated with each task due to internal or external drivers were identified. 3. For each identified risk, the relevant sustainability dimension was established and suitable performance indicators were identified. To achieve the above, Austroads integrated asset management framework was used as a guide [1]. It comprised three main parts, including strategic planning, asset management actions, and performance feedback. These stages were subdivided into seven phases including define objectives (phase 1), form asset strategies (phase 2), develop investment programme (phase 3), identify asset WIT Transactions on The Built Environment, Vol 130, © 2013 WIT Press www.witpress.com, ISSN 1743-3509 (on-line)

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requirement (phase 4), implement work programme (phase 5), audit (phase 6) and review (phase 7). Austroads reports [1, 7] were used to identify all processes and tasks involved in these phases and their interactions. Possible internal (e.g. knowledge gap, resistance to change) and external drivers (e.g. climate change, legislation requirements) and associated risks that may influence the different processes/tasks were identified. This helped in establishing sustainability dimensions relevant to each phase. Good practice examples for mitigating the risks were documented, which helped in identifying suitable performance indicators and measures relevant to the applicable sustainability dimensions.

3 Framework development for sustainability performance measurement of RTAM practice The approach and methodology proposed in this study for developing the framework combine concepts from the following three frameworks namely: The theme-based or impact-based framework described in [8, 9] the influence-based framework described in [8, 10], and the goal-oriented framework described in [9]. Figure 1 shows the proposed conceptual framework for developing performance measurements for RTAM. To simplify the application of this framework to the seven phases of the asset management cycle, the latter has been represented by four focus areas as presented below. This helps simplify linking the indicators to the different activities in the different phases. 1. 2. 3. 4.

Planning (L1) – Phases 1 and 2 Programming (L2) – Phases 3 and 4 Implementation (L3) – Phase 5 Performance feedback (L4) – Phases 6 and 7

The fundamental components of the framework outline the process for developing sustainability performance measures in five steps as described below.  Step 1: Define sustainability dimensions – The conceptual framework defines the six dimensions of sustainability, including economic, social, environmental, corporate, financial and technological. The theme-based framework was used to define the multidimensional sustainability concept.  Step 2: Define sustainability goals – In this step, each sustainability dimension was defined by the expected common sustainability goals. A goaloriented framework was used to interconnect sustainability dimensions with relevant sustainability goals. The defined goals should be achievable, well balanced and need to cover the basic principles of sustainability and asset management. A comprehensive literature review resulted in identifying a set of 13 generic goals for transportation agencies to address the principles of asset management sustainability. The sustainability dimensions and proposed respective goals are listed in table 1.



STEP 5

Goal (CO1)

Conceptual framework for developing performance measurement for sustainable RTAM.

Performance measure (CO222/L4)

Performance Feedback (L4)

Performance measure (EN111/L4)

Figure 1:


Implementation (L3)



Indicator 2 (CO222)

Programming (L2)

Indicator 1 (CO221)

Goal (CO2)

Objective (CO22)

Corporate

Objective 1 (CO21)

Technological


Indicator 2 (EN1I2)

Financial


Indicator 1 (ENI11)

STEP 4

Objective 2 (EN12)

Economic

Planning (L1)

Objective 1 (EN11)

STEP 3

Goal 2 (EN2)

Social


Goal 1 (EN1)

Environment

STEP 2

STEP 1

SUSTAINABILITY COMPOSITE INDEX


Feedback loop

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 Step 3: Define sustainability objectives – the goals were further deconstructed into achievable objectives that must be fully associated with the organization’s strategic plan. The objectives are more specific than the goals and lay the foundation for links with the performance indicators. The proposed objectives are common to all focus areas of the asset management cycle (See example in Table 2 for objectives relevant to social sustainability goal SO1).  Step 4: Define performance indicators – in this step, each objective was further classified into performance indicators. The indicators are used to interlink common objectives and performance measures at different operational levels within the transportation organization. The indicator refers to variables used in monitoring performance, which become performance measures when compared against benchmark values.  Step 5: Define performance measures for different operational levels – each indicator was linked by one or more performances measures for the different focus areas of asset management (L1, L2, L3, and L4). An influence-based framework was used to define performance measures for the different levels. Ideal performance measures are easily understood, providing a clear indication of movement towards an established goal, and can be tracked using accessible and available data. The selection of appropriate performance measures is an important and challenging task and it can be applied over different timeframes (long term, medium term and short term), for different types of analysis (planning, operational or strategic), different levels of analysis (project, corridor, network or regional), and relevant sustainability dimensions [11, 12]. For example, asset management at the strategic level is focused on the long term planning of each asset group, and tactical asset management is used to determine which assets should be replaced in the programming level [13, 14]. Therefore, the applicability of a sustainability indicator needs to be carefully considered at the different focus levels, and measures need to be changed accordingly. Different sustainability measures can then be defined for a performance indicator for better sustainability evaluation; see example in Table 2.  The feedback loop was used to redefine indicators for unmatched conditions by altering the indicators, objectives and goals. It can be used to address the changing needs of road asset management due to the risks to sustainability associated with external and internal drivers. A comprehensive review of the literature resulted in identifying a large number of performance measures (540) that are relevant to the thirteen sustainability goals. To make the framework more practical and simplify its application, the number of proposed performance measures was reduced by selecting measures that are common for each indicator across all four focus areas. Figures 2a, 2b, 3a, 3b, 4a, and 4b present the final performance measurement frameworks and proposed measures for t, environmental, social, corporate, economic, financial, and technological sustainability respectively.


692 Urban Transport XIX Table 1:

Defined goals for the six RTAM sustainability dimensions.

Sustainability Dimensions Environment (EN) Economic (EC) Social (SO) Corporate (CO) Technological (TE) Financial (FI)

Table 2:

Objective

Goals EN1 – Conserve energy and natural resources EN2 – Minimize emission and noise pollution EN3 – Minimize waste accumulation EN4 – Enhanced bio diversity and proper functioning of ecosystem EC1– Maximize economic productivity by improving assets efficiency EC2– Ensure economic Development SO 1– Enhance public health, safety, and security SO2– Ensure equitable and affordable service SO3– Ensure community development CO1– Improve quality of life of agency’s employees CO2– Improve sustainable culture within organization TE1– Ensure technological advancement FI1 – Improve organization financial affordability

Possible objectives, indicators and measures for example goalEnhance public health, safety and security (SO1). Indicator

Focus area

Planning

SO11: Improve safety and Safety security improvements requirements

Programming

Implementation Performance feedback

SO12: Minimize safety issues Safety related to poor of performance of the condition infrastructures transportation infrastructure

Planning Programming Implementation Performance feedback

Potential performance measures  Change in number of road crashes  Change in the percentage of projects where non-infrastructure based safety countermeasures were selected as part of the project  Funding Improvements of traffic safety related R&D  Number and proportion of projects evaluated for effect on crashes  Improve project safety evaluation method based on the substantial safety versus nominal safety  Change in number and severity of crashes  Number of project address the safety concern at the corridors level  Change in number and severity of crashes  Change in accident cost  Number of safety related complains  Overall rating of road infrastructures  Number of project evaluated based on infrastructures performance  Pavement skid resistance  Bridge health index  Overall safety improvements in the infrastructure performances

4 Conclusion and scope for future work In this paper, a framework has been proposed to measure the performance of asset management practice in addressing sustainability. It adopts a holistic view of RTAM practice and includes six defined dimensions of the sustainability concept to address the emerging challenges. The proposed sustainability performance measurement framework, and the approach to measure development, are generic and can be adopted by any road agency. The proposed WIT Transactions on The Built Environment, Vol 130, © 2013 WIT Press www.witpress.com, ISSN 1743-3509 (on-line)


EN4

EN3

EN2

EN 1

ENVIRONMENT SUTAINABILITY

Energy consumption

Maintain habitat connectivity

EN41: Ensure that ecosystem functioning properly

Figure 1:

Net enhancement of habitat and valuable species

Change in eco-system ( land and aquatic) connectivity due to transportation activities. e.g. 1. Number of funa underpass 2. Extent of fauna exclusion fencing

Initiatives to reduce to total waste generation. e.g. 1. Divert waste into land fill 2. Recycled road material

Traffic noise exposure e.g. 1.Number of noise level complaints above criteria

SOCIAL SUSTAINABILITY

SO3

SO2

SO1

SO31: Increase accessibility

SO22: Improve social and cultural equity within different societies

SO21: Improve participation process

2b

Increase basic social accessibility

Affordable service

Upgrading facility for disadvantage people

Stakeholders participation for planning

Facility for active transport modes

SO13: Improve public health condition

Change in access to major services. e.g. 1.Accessibilty Index

Quality and availability of affordable modes. e.g. 1.User satisfaction rating for public transport servic

Relative change in the transport cost index

Facilities provided for disadvantage people. e.g. 1. Percentage of destination accessible by people with disability.

Stakeholder satisfaction measures in their involvement in transport activities

Percentage of transport plans includes walking and /or cycling facilities

Safety related performance measures (pavement skid resistance, bridges health index etc.). e.g. 1.Preventative maintenance measures

1. User satisfaction rating for public transport safety 2.Number of safety related complains

Perception of public transport safety

Safety condition of Infrastructures

1.Casualty crashes 2.Road fatalitie 3.Persons hospitalized

Safety improvements

SO12: Minimize safety issues of infrastructure

SO11: Improve safety and security requirements

Performance measurement framework for environmental and social sustainability

2a

Conserve and enhance biodiversity values

Reduce total waste generation

EN31: Waste management

EN42: Enhance biodiversity

Noise management

Air quality

Energy efficient system for passenger transport and road infrastructure. e.g. 1. Change in energy consumption in transportation activities (A)

Road transport Green house gas emmission e.g. 1. Vehicle fleet emission 2. Air quality inde

Percentage of green energy use

Percentage of recycle and reuse water

Percentage of recycle and reuse material

Green energy use

Maximize water use efficiency

Improve material reuse and recycle

EN22: Reduce Noise pollution

EN21: Reduce air pollution

EN13: Improve energy efficiency

EN11: Minimize material consumption

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CO2

CO1

Number of work days due to injury

Provide safe, healthy and secure work place


Figure 2:

Office facility emission (Co2)

Emission

ECONOMIC SUSTAINABILITY

EC2

EC1

EC 23: Economic affordability

EC 22: Balance spatial planning and improve accessibility

EC 21: Local economic development

EC12: Improve resilience of transport infrastructure for climate change risks

EC11: Improve system efficiency and reduce congestion

Percentage of house hold expenditure dedicated to transportation

Expenditure for transportation related activities

3b

Percentage of demographic change/ Land use balance

Improve road base fright movement. e.g. 1. Lane ocuupancy rate 2. Car occupancy rate Improve accessibility Optimal land use for mix development balance

Net change in the jobs / income associated with transportation activities

Improve employment opportunities

Number of projects considered for risk assessment and climate change adaptation practices.

1. Ride Quality 2. Smooth travel exposure (measure IRI)

Transport assets which meets agreed standard Climate change adaptation practices

1. Congestion indicator 2. Actual travel speed 3. Nominal travel speed 4. Congestion indicator 5. Variability of travel time

Improve mobility / Travel time reliability

Performance measurement framework for corporate and economic sustainability

3a

Office facility energy consumption

Energy consumption

Procurement evaluation included sustainability criteria. (Select suppliers who follow sustainable procurement policies and practices)

Sustainable procurement of goods and services by using robust selection method

CO22: Sustainable purchasing and procurement

CO23: Minimize waste, reduce energy consumption and uildings

Report on status analysis and coordination of the corporate measures (regulaer reporting of defined performnec meausres)

Leading and influence state and national transport-related policy reform. e.g. 1. High level department policy reflected in state and national transportrelated policy reform

Improve sustainbility reporting culture

Enhance Leadership

Enhance stakeholder relationship

1.Employee turnover 2.Percentage of qualified engineers within the organization

Improve capacity and capabilities of work force

Identify key stakeholders and their regular involvement in decision making ( stakeholders satisfaction on decision making process)

1.Regular training for staff member 2.Construction training on civil infrastructure projects

Staff development and knowledge management

CO21: Well coordination of sustainability improvement measures

CO12: Enhance leadership and improve stakeholders relationship

CO11: Staff motivation and improve target work force within organization


CORPORATE SUSTAINABILITY

FI1


Figure 3:

Improve disaster preparedness

F13: Minimize financial risk in disaster situation

Reserved funds for disasters as % of annual road infrastructure maintenance budget

TECHNOLOGICAL SUSTAINBILITY

TE1

TE12: Improve technical capabilities

TE11: Improve R&D opportunities

4b

Change in legislations for use of Best Available Technology (BAT) for asset management

Provide opportunities to upgrade staff skills and ensure staff acceptance of new technology

Ensure financial support for R&D

Collaborative research programme

1. Change legislation towards technological advancement 2. Long term plan for technological improvements

Change in provided opportunities to upgrade existing technologies and skills

Change in percentage of public /private partnership of expenditure of sustainability related R&D

Change in number of collaborative work with R&D institutes and universities

Performance measurement framework for financial and technological sustainability

4a

Proper timing and budget planning

1. Percentage of transport project in the state planning programme completed no more than 10 percent over budget 2. Percentage of major construction projects (road) completed no more than 10 per cent outside the programmed construction period 3. Percentage of major construction project(road) costing less than 10 per cent over the programmed estimate

1. Asset renewal funding ratio 2. Asset sustainability ratio 3. Renewal gap

Capital spent compared to depreciation

Measure investment gap

Measure finding availability for gap renewal

Net operation cash flow compared to underlying revenue

Portion of budget devoted to transport planning form state funding. Leverage non-traditional funding source (percentage of funding from non-traditional sources)

Self-financial ability

F12: Maximize value for money

F12: Improve financial availability

Reserve funding

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FINANCIAL SUSTAINBILITY

696 Urban Transport XIX goals, objectives and indicators are also generic and can be easily adopted by any agency or changed to suit an agency’s strategic directions. The measures, however, can vary across agencies depending on availability of relevant data, information and acceptance by staff.

References [1] Ausroads – Guide to asset management ( part 1,2,3,4,5,7, and 8) Austroads inc. Australia. [2] Transportation Association of Canada (TAC). Primer on Highway asset management system, 1999. [3] Asset management for the road sector. OECD Publications, OECD Publications Service, Paris, 2001. [4] State government Victoria/ Australia, Asset Management principles: Part 1. http://www.dtf.vic.gov.au/CA25713E0002EF43/WebObj/AssetManagemen tSeriesPart1/$File/AssetManagementSeriesPart1.pdf. [5] Institute of Asset Management (IAM) BSI, Publically available specification (PAS) 55-1:2008 Part 1, UK, 2008. [6] Zietsman, J. & Rilett, L.R., Sustainable Transportation: Conceptualization and Performance Measures. Southwest Region University Transportation Centre, Texas A&M University, College Station, USA. March 2002. [7] Austroads Inc., Integrated Asset Management Guidelines for Road Networks, Austroads Publication No. AP–R202/02, Australia, 2002. [8] Jeon, C.M. & Amekudzi, A., Addressing sustainability in transportation systems: Definitions, indicators, and metrics. Journal of infrastructure systems, 11(1), pp. 31-50, 2005. [9] Nichols, J.E., Garrick, N.W. & Atkinson-Palombo C., Framework for Developing Indicators of Sustainability for Transportation Planning. Proc. 88th Annual Meeting of the Transportation Research Board, Washington, D.C., 2009. [10] Pei, Y.L., Amekudzi, A.A., Meye, M.D., Barrella, E.M. & Ross, C.L., Performance Measurement Frameworks and Development of Effective Sustainable Transport Strategies and Indicators. Journal of the transporation research board, No 2163, pp. 73-80, 2010. [11] Ramani, T.L., Zietsman, J., Gudmundsson, H., Hall, R. P. & Marsden, G., Framework for sustainability assessment by transportation agencies. Journal of the transporation research board, No 2242, pp. 9-18, 2012. [12] Cambridge Systematises, Inc. PB Consult, Inc. & Texas Transportation Institute. Performance Measures and Targets for Transportation Asset Management, Transportation research board, Washington, D.C., 2006. [13] Marlow, D.R., Sustainability based asset management. Water service assiciation, National research FLAGSHIP: water for a Healthy country. CISRO, Australia, 2008. [14] Cambridge Systematics, Inc. & Meyer, M.D., U. S. Domestic Scan Program: Best Practices in Transportation Asset Management: NCHRP 20-68. The AASTHO and Transportation Officials FHA, USA, 2007.
