Investment decision-making under risk (reliability) and uncertainty for infrastructure asset management

Risks and uncertainties are inevitable in engineering projects and infrastructure investments. Decisions about investment in infrastructure such as for maintenance, rehabilitation and construction works can pose risks, and may generate significant impacts on social, cultural, environmental and other related issues. This report presents the results of a literature review of current practice in identifying, quantifying and managing risks and predicting impacts as part of the planning and assessment process for infrastructure investment proposals. In assessing proposals for investment in infrastructure, it is necessary to consider social, cultural and environmental risks and impacts to the overall community, as well as financial risks to the investor. The report defines and explains the concept of risk and uncertainty, and describes the three main methodology approaches to the analysis of risk and uncertainty in investment planning for infrastructure, viz examining a range of scenarios or options, sensitivity analysis, and a statistical probability approach, listed here in order of increasing merit and complexity. Forecasts of costs, benefits and community impacts of infrastructure are recognised as central aspects of developing and assessing investment proposals. Increasingly complex modelling techniques are being used for investment evaluation. The literature review identified forecasting errors as the major cause of risk. The report contains a summary of the broad nature of decision-making tools used by governments and other organisations in Australia, New Zealand, Europe and North America, and shows their overall approach to risk assessment in assessing public infrastructure proposals. While there are established techniques to quantify financial and economic risks, quantification is far less developed for political, social and environmental risks and impacts. The report contains a summary of the broad nature of decision-making tools used by governments and other organisations in Australia, New Zealand, Europe and North America, and shows their overall approach to risk assessment in assessing public infrastructure proposals. While there are established techniques to quantify financial and economic risks, quantification is far less developed for political, social and environmental risks and impacts. For risks that cannot be readily quantified, assessment techniques commonly include classification or rating systems for likelihood and consequence. The report outlines the system used by the Australian Defence Organisation and in the Australian Standard on risk management. After each risk is identified and quantified or rated, consideration can be given to reducing the risk, and managing any remaining risk as part of the scope of the project. The literature review identified use of risk mapping techniques by a North American chemical company and by the Australian Defence Organisation. This literature review has enabled a risk assessment strategy to be developed, and will underpin an examination of the feasibility of developing a risk assessment capability using a probability approach.

Be careful what you ask for : how inquiry strategy influences readiness mode

Much has been written about affecting change in the workplace, including how to help employees prepare for the process. However, little is known about how participation influences employees' emotions and attitudes at the start of an intervention. By qualitatively analyzing conversations that were triggered by an organizational change effort, we explored how different inquiry strategies influence readiness for change. We examined four inquiry strategies by combining strength or deficit frames with individual or organizational focus. Distinctive conversational patterns emerged within each strategy, which we believe influence peoples' change readiness. In this article we present four readiness modes to describe these patterns and conclude with implications for managers who seek to shape their change efforts more effectively.

Identifying and implementing adaptive strategy in the U.S. military

Changes in the environment, including increased environmental complexity, require military supply units to employ a more adaptive strategy in order to enhance military agility. We extend the Lumpkin and Dess (1996) model and develop propositions that explore the interrelationships between/amongst entrepreneurial orientation (EO); opportunity recognition, evaluation and exploitation; environmental and organizational factors; and organizational performance. We propose that the innovativeness, proactiveness, and risk-taking dimensions of EO are of primary importance in identifying adaptive solutions and that these relationships are moderated by environmental factors. The autonomy and competitive aggressiveness dimensions of EO are important in implementing solutions as adaptive strategies, especially in a military context, and these relationships are moderated by organizational factors. This chapter extends existing theory developed primarily for the civilian sector to the military. Military organizations are more rigid hierarchical structures, and have different measures of performance. At an applied level, this research provides insights for military commanders that can potentially enhance agility and adaptability.

Extending knowledge management across the supply chains in the construction industry : knowledge sharing in construction supply chains

Supply chain management and knowledge management have emerged as two distinct business philosophies in the last decade. Both are making rapid inroads into the construction industry. The premise of this paper is that knowledge management would make it possible for all the trading partners in a supply chain to reap benefits. Current research in knowledge management in the construction industry is generally targeting those big organisations that are main contractors. This has restricted the scope of knowledge management, and limits the benefits to a few, rather than the whole industry. If the construction industry as a whole is to prosper and improve its productivity, strategies for knowledge management strategy at the industry level must be established. This paper argues the case for extending the scope of knowledge management across the full extent of the supply chain, and attempts to identify the benefits that may arise out of sharing knowledge across the supply chain.

Sustainable water provision : alternative strategy and sources in the era of climate change

As a result of rapid urbanisation, population growth, change in lifestyles, pollution and the impacts of climate change, water provision has become a critical challenge for planners and policy-makers. In the wake of increasingly difficult water provision and drought, the notion that freshwater is a finite and vulnerable resources is increasingly being realised. Many city administrations around the World are struggling to provide water security for their residents to maintain lifestyle and economic grouth. This paper review the glocalalternatives to current water sources, including that of desalination, water transfers, recycling, and integrated water management. A comparative study on alternative resources is undertaken and the results are discussed.

Emergency department surge capacity : Recommendations of the Australasian surge strategy working group

Background For more than a decade emergency medicine organizations have produced guidelines, training and leadership for disaster management. However to date, there have been limited guidelines for emergency physicians needing to provide a rapid response to a surge in demand. The aim of this study is to identify strategies which may guide surge management in the Emergency Department. Method A working group of individuals experienced in disaster medicine from the Australasian College for Emergency Medicine Disaster Medicine Subcommittee (the Australasian Surge Strategy Working Group) was established to undertake this work. The Working Group used a modified Delphi technique to examine response actions in surge situations. The Working Group identified underlying assumptions from epidemiological and empirical understanding and then identified remedial strategies from literature and from personal experience and collated these within domains of space, staff, supplies, and system operation. Findings These recommendations detail 22 potential actions available to an emergency physician working in the context of surge. The Working Group also provides detailed guidance on surge recognition, triage, patient flow through the emergency department and clinical goals and practices. Discussion These strategies provide guidance to emergency physicians confronting the challenges of a surge in demand. The paper also identifies areas that merit future research including the measurement of surge capacity, constraints to strategy implementation, validation of surge strategies and measurement of strategy impacts on throughput, cost, and quality of care.

Power management and power flow control with back-to-back converters in a utility connected microgrid

This paper proposes a method for power flow control between utility and microgrid through back-to-back converters, which facilitates desired real and reactive power flow between utility and microgrid. In the proposed control strategy, the system can run in two different modes depending on the power requirement in the microgrid. In mode-1, specified amount of real and reactive power are shared between the utility and the microgrid through the back-to-back converters. Mode-2 is invoked when the power that can be supplied by the DGs in the microgrid reaches its maximum limit. In such a case, the rest of the power demand of the microgrid has to be supplied by the utility. An arrangement between DGs in the microgrid is proposed to achieve load sharing in both grid connected and islanded modes. The back-to-back converters also provide total frequency isolation between the utility and the microgrid. It is shown that the voltage or frequency fluctuation in the utility side has no impact on voltage or power in microgrid side. Proper relay-breaker operation coordination is proposed during fault along with the blocking of the back-to-back converters for seamless resynchronization. Both impedance and motor type loads are considered to verify the system stability. The impact of dc side voltage fluctuation of the DGs and DG tripping on power sharing is also investigated. The efficacy of the proposed control ar-rangement has been validated through simulation for various operating conditions. The model of the microgrid power system is simulated in PSCAD.

Determination of optimal preventive maintenance strategy for serial production lines

A Split System Approach (SSA) based methodology is presented to assist in making optimal Preventive Maintenance decisions for serial production lines. The methodology treats a production line as a complex series system with multiple PM actions over multiple intervals. Both risk related cost and maintenance related cost are factored into the methodology as either deterministic or random variables. This SSA based methodology enables Asset Management (AM) decisions to be optimized considering a variety of factors including failure probability, failure cost, maintenance cost, PM performance, and the type of PM strategy. The application of this new methodology and an evaluation of the effects of these factors on PM decisions are demonstrated using an example. The results of this work show that the performance of a PM strategy can be measured by its Total Expected Cost Index (TECI). The optimal PM interval is dependent on TECI, PM performance and types of PM strategies. These factors are interrelated. Generally it was found that a trade-off between reliability and the number of PM actions needs to be made so that one can minimize Total Expected Cost (TEC) for asset maintenance.

Manufacturing management programs : are developing economies bridging the strategic gap?

Over the past decade there have been a large number of significant innovations in manufacturing which have resulted in more flexible and cost efficient methods and higher quality products, as manufacturers have set about upgrading their processes, systems and performance. This study compares the use of technologies and improvement programs between OECD and Non-OECD countries, and also between small and large firms, and examines differences in the use and outcomes across the economies and different sized firms. The empirical analysis provides an opportunity to test whether the ‘capabilities’ or strengths of a firm can be linked to these activities and examines if developing economies are using technology or management programs such as quality management and business process re-engineering to catch up to manufacturers in developed economies. The analysis utilises data from the second International Manufacturing Strategy Survey (IMSS), which encompasses 703 firms in 23 countries.

Performance measurement and continuous improvement : are they linked to manufacturing strategy?

To maintain or achieve competitiveness and profitability, a manufacturing firm or enterprise must respond to a range of challenges, including rapid improvements in technology; declining employment and output; globalisation of markets and environmental requirements. In addition, substantial changes in government policy have had important impacts in many countries, as have the increasing levels of global trade. Manufacturing enterprises need to have a clear understanding of what their customers want and why customers purchase their products rather than purchase from their competitors. They need to fully understand the aims of the business in terms of its customers, market segments, product attributes, geographical markets and performance. Continuous Improvement (CI) methods have become widely adopted and regarded as providing an important component of increased company competitiveness. This article examines the extent to which continuous improvement activities have contributed to the different areas of business performance.