Strategic Decision-Making in Asset Management
An Approach to Study Long-Term Strategic Decisions in Water Cycle Infrastructures
J.A. Gonzalez-Moscoso
P.M. Herder – Mentor
T.E. van der Lei – Mentor
J.H. Slinger – Mentor
R. Kloosterman – Mentor
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Abstract
Climate change, population growth and increasing consumption patterns of water and increasing urbanisation are challenges and future uncertainties that place stress upon urban water infrastructures. These urban challenges, along with the complexities of asset-intensive systems and socio-economic structures, make the development of efficient long-term strategies for the asset management of urban water cycle systems (WCS) problematic. Vitens - the largest drinking water company in the Netherlands - has considered changing their risk based asset management approach from input oriented short term, to an outcome oriented long-term approach in line with the institutional environment, which could lead to the development of efficient long-term strategies that would help cope with the complex characteristics of drinking water systems and uncertainties of the future. However, there are related complexities to effectively study the strategic decision-making process for asset management. This thesis aimed to develop a methodological framework that links the complexities of studying long-term strategic decision-making processes for asset management at water companies. The case study research shows that the strategic decision-making process of asset management can be studied by applying an integrated and systematic methodological framework based using the systems diagram method with a different approach. The approach manages three articulated complexities to study the strategic decision-making process: 1) the contentious concept of the asset management process, as it varies within industries, strategic asset management maturity and institutional arrangements; 2) the complex functions of the assets in Water Cycle Systems, and the norms governing them, that are hard to define and quantify; and 3) the difficulties in characterising the interrelations between the internal and external context that constitute the decision-making process. As a result, knowledge relevant to Vitens’ needs was gained in terms of: 1) the decision-making process to develop long-term strategies and strategic objectives; 2) the alignment within in the levels of the asset management process; and, 3) the integration of society needs, institutional arrangements, the environment and the business functions in the decision-making process.