National Academies Press: OpenBook

Analytical Tools for Asset Management (2005)

Chapter: Section 1 - Introduction

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Suggested Citation:"Section 1 - Introduction." National Academies of Sciences, Engineering, and Medicine. 2005. Analytical Tools for Asset Management. Washington, DC: The National Academies Press. doi: 10.17226/13851.
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Suggested Citation:"Section 1 - Introduction." National Academies of Sciences, Engineering, and Medicine. 2005. Analytical Tools for Asset Management. Washington, DC: The National Academies Press. doi: 10.17226/13851.
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Suggested Citation:"Section 1 - Introduction." National Academies of Sciences, Engineering, and Medicine. 2005. Analytical Tools for Asset Management. Washington, DC: The National Academies Press. doi: 10.17226/13851.
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Suggested Citation:"Section 1 - Introduction." National Academies of Sciences, Engineering, and Medicine. 2005. Analytical Tools for Asset Management. Washington, DC: The National Academies Press. doi: 10.17226/13851.
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Suggested Citation:"Section 1 - Introduction." National Academies of Sciences, Engineering, and Medicine. 2005. Analytical Tools for Asset Management. Washington, DC: The National Academies Press. doi: 10.17226/13851.
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Suggested Citation:"Section 1 - Introduction." National Academies of Sciences, Engineering, and Medicine. 2005. Analytical Tools for Asset Management. Washington, DC: The National Academies Press. doi: 10.17226/13851.
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3SECTION 1 INTRODUCTION 1.1 RESEARCH OBJECTIVES The objective of the NCHRP Project 20-57 was “to develop a set of user-friendly analytical tools for adaptation and use by state DOTs and other transportation agencies that will improve their ability to identify, evaluate, and recommend investment decisions for managing the agency’s assets. The tools should incorporate analyses of the tradeoffs associated with (1) different approaches to sustaining an asset through its service life, such as capital improvements versus pre- ventative maintenance treatments; and (2) competing policy objectives such as preservation, mobility, access, safety, and economic development. The primary emphasis should be on the analysis of tradeoff decisions within the highway mode, but also should include limited development of tools for making multimodal investment tradeoff decisions. The tools should be compatible, to the greatest extent possible, with the existing range of legacy systems (pavement, bridge, and other asset management systems) currently used by state DOTs, and be easily used by practitioners with varying levels of technical capability.” The research objective recognizes the wide range of goals and activities necessary for successful asset management. It also recognizes the existence of numerous useful legacy sys- tems and procedures and the need for a project such as this that can very opportunistically select and accomplish the most important and cost-effective improvements to overall asset management. NCHRP Project 20-24(11), completed November 2002, established a comprehensive framework for transportation asset management. This framework defines asset manage- ment as a strategic approach to managing transportation infra- structure and identifies the essential elements of good asset management practice, including • Consideration of a wide range of options for addressing transportation needs and problems; • Analysis of investment options based on established performance objectives; • Explicit consideration of investment tradeoffs across programs, modes, and strategies; and • Use of economic and engineering criteria to evalu- ate investment options from a long-term, life-cycle perspective. Analysis tools that help agencies to understand the impli- cations of different investment options are a cornerstone of effective asset management practice. These tools can con- tribute to strengthened business processes in several areas: integration of information on transportation modes or pro- grams; analyses of economic and other impacts of invest- ment decisions; investigation of optimal strategies in areas such as preventive maintenance; and assessment of invest- ment tradeoffs across programs, modes, or investment options. Most state DOTs have management systems in place that pro- vide useful capabilities for assessing needs and recommend- ing work for specific asset types (e.g., pavements, bridges, and public transit or aviation facilities) and specific functions (e.g., highway, airfield, or rail maintenance). In addition, spe- cialized tools for benefit/cost analysis, life-cycle cost analy- sis, and investment performance analysis for selected types of strategies are in use. As a rule however, existing tools are not well suited to helping with decisions that cross the boundaries of asset type (e.g., pavement versus bridge), mode (e.g., highway versus transit), work class (e.g., maintenance, operations, or con- struction), or objective (e.g., safety, preservation, or mobil- ity). Such cross-boundary decisions include • Preservation versus mobility. How to make explicit tradeoffs across programs that may have very different objectives and performance measures (i.e., the “apples versus oranges” problem). • Maintenance versus capital. How to determine the best mix of routine maintenance and capital investments in infrastructure for least life-cycle costs and how to assess the cost-efficiency of different preventive versus deferred maintenance policies. • Cost-effective solutions. How to determine the most cost-effective solution to a problem, without being con- strained to a particular class of solutions (e.g., opera- tional, maintenance, or capital). • Best combinations of projects. How to identify pack- ages of projects that can result in the highest long-term benefits and cost savings (e.g., by coordinated schedul- ing of work for a particular location) and how to iden- tify groupings of projects of different types that have synergistic effects.

• Impacts of project needs criteria and design stan- dards. How to explore how variations in design stan- dards or project needs criteria might affect long-term costs and system performance measures. • Multiobjective evaluation. How to understand the impacts of a given mix of projects, recognizing that (1) each project may have both positive and negative impacts with respect to different performance objectives and (2) cross-project elasticities may be at work (one project may have the effect of reducing or increasing the effectiveness of a second project). Some agencies are pursuing new performance-based approaches to asset management and are seeking improved tools for addressing the cited types of questions. The capa- bilities of existing management systems and tools need to be strengthened, supplemented, and better integrated to address gaps in current decision-support capabilities. For example, although considerable effort is being expended to define and collect data on performance measures and although such measures are used for technical evaluations and tactical deci- sions, tools are lacking for more strategic applications such as tradeoff analyses. New tools must be easy to implement and suitable for inte- gration into transportation organizations with varying data- bases, systems, and decision-making processes. These tools must complement, enhance, and extend, rather than duplicate, existing tools and systems. Additionally, these tools should apply to several levels within the transportation organiza- tion. Several types of tools were therefore considered in this research effort: • Simulation models that provide detailed analyses of the performance, costs, and impacts of decisions regarding transportation systems. These types of models are very useful for analyzing complex problems with many inter- active elements; however, they typically require consid- erable input data and either a well-structured set of deci- sion rules or repetitive runs to analyze different options. • Sketch-planning tools also embody analyses of perfor- mance, costs, and impacts of transportation decisions, but at a less detailed level. They are easier and quicker to use and can be used to explore several options quickly and effectively. These tools may be built as computer appli- cations, spreadsheet workbooks, or manuals of heuristic procedures. • What-if tools can be used when very simple and easy- to-use analytic procedures are needed. Existing simula- tion or sketch-planning tools are applied repetitively to “solve” a particular problem; this “solution” can then be embodied in a very simple format for application by end-users. For example, the FHWA’s National Bridge Investment Analysis System (NBIAS) uses mathemati- cal techniques to “solve” bridge investment problems as 4 a function of key parameters. These “solutions” are then incorporated in very efficient mathematical relation- ships so that an end-user investigating bridge invest- ment options in effect “sees” the implications of his or her decisions in real time. The user can fine-tune the invest- ment parameters to achieve an optimal result quickly and effectively. With its ability to relate outputs and out- comes to decision inputs in real time, NBIAS is useful as a communications tool to policy-makers and as a decision tool to managers. Another way to apply this approach is to exercise simulation models repetitively to obtain solutions to a set of problems and then to display these several results in a convenient format (e.g., simple parametric curves, diagrams defining preferred solu- tions for particular combinations of inputs, or “rules of thumb” procedures). • Databases can be organized to compile information on particular topics, such as highway performance stan- dards by functional classification. Such databases can be helpful in designing and building more effective ana- lytic components of asset management, as well as hous- ing current information after implementation for use in cross-sectional and trend analyses. This research has identified areas in which additional analy- sis support would have the most impact on asset management practice. The research has focused on building capabilities likely to be deployed in numerous agencies and unlikely to be addressed soon by other tool-development efforts. Figure 1 illustrates a high-level vision for how new ana- lytical tools will work with core asset information, agency business rules, and national or agency-specific parameters to provide improved decision-support capabilities. 1.2 OVERVIEW OF THE RESEARCH APPROACH The research effort was divided into two phases. The ini- tial phase was a 6-month process to recommend a set of tools for development, based on both an assessment of current needs and a review of existing tools. The second phase of the research consisted of a 24-month effort to design, prototype, field test, refine, and deliver the final tools. Needs Assessment In conducting the needs assessment, the research team analyzed key aspects of a DOT’s business processes to iden- tify likely candidates for analytic techniques to be developed in this project. Figure 2 illustrates a generalized model for asset management decision-making that provided a frame- work for the needs assessment. Key processes in this model follow:

5Geography and Standard Location Referencing Inventory Inspection Traffic Crash Statistics Work History Programmed Work Business Rules • Performance Measures and Standards • Deficiency Criteria • Design Standards • Maintenance Standards • Standard Procedures • Program Categories • Funding Levels Decision Support • Needs and Solutions • Evaluation of Options • Investment vs. Performance Trade-offs Life-Cycle Costing Benefit/Cost Analysis Needs Simulation GIS Query and Analysis Tools Risk Analysis Database Query and Reporting Tools Sketch-Planning Impact Analysis Tools Network Models Specialized Databases Optimization Heuristic Decision Rules Analytical Tools Core Asset Data Analysis Parameters • Unit Costs • Service Life and Deterioration Models • Discount Rate • Value of Time • Accident Costs • Default Average Speeds • Default Auto Occupancy Figure 1. Context for analytical toolbox. Establish Goals, Objectives, and Performance Measures Analyze Current/Future Condition and Performance Develop Plans and Programs Monitor Results Evaluate Investment Levels and Tradeoffs Identify Needs and Solutions Evaluate and Compare Options Figure 2. Generalized asset management model.

• Establishing goals, objectives, and performance mea- sures to provide policy direction and an evaluation framework for asset management. • Analyzing current and future system condition and performance on an aggregate level and at individual locations. • Evaluating investment levels and tradeoffs to under- stand the relationship between funding levels for partic- ular categories of work and likely outcomes. This analy- sis may be used to guide establishment of funding levels for different program categories. It also can assist in establishing performance targets (for different groups of assets) that reflect realistic budget levels. • Identifying needs and solutions. • Evaluating and comparing options by assessing the potential impacts of alternative solutions to identified problems. The term “solutions” here is used in a broad sense, including specific capital projects, operational strategies, preventive maintenance programs, or coordi- nated programs of activities (e.g., high-occupancy vehi- cle [HOV] lanes with park-and-ride lots). • Developing plans and programs through assembly of a coordinated set of solutions constrained by a budget. This development could involve selecting projects from the pool of recommended solutions, scheduling work to achieve maximum coordination and economies of scale, and evaluating the aggregate performance impacts of different mixes of work. • Monitoring results by (1) collecting information on the costs and effectiveness of projects or strategies that have been implemented, with a feedback loop into the project evaluation activities, and (2) collecting current system performance information, which is used to analyze cur- rent and future performance and to revisit and refine program objectives and priorities. This model allows for variations in the extent and methods by which these activities are performed. For example, one agency might wish to conduct separate analyses of needs, investments levels, and solutions for pavements, bridges, and maintenance activities and then combine them at the program development stage. A second agency might collect data on conditions and deficiencies separately but conduct integrated analyses across the three areas to identify and evaluate solu- tions that address multiple objectives. Needs for analytical tools for these two cases could vary. In the first case, the emphasis would be on building solid investment and strategy analysis capabilities within pavement, bridge, and mainte- nance management systems. In the second case, tools would be needed that would (1) support geographic information system (GIS)–based integrated analysis of deficiencies and (2) provide the capability to analyze the combined effects of both capital and maintenance activities on pavements and bridges with respect to a consolidated set of performance measures. 6 Table 1 provides examples of different methods and asso- ciated analytical tools for the three core processes shown at the center of Figure 2: Evaluate Investment Levels and Tradeoffs, Identify Needs and Solutions, and Evaluate and Compare Options. For each of these processes, different methods and core analytical tools might be employed. Some of the analytical support functions in Table 1 are in existing systems and tools, at least for certain types of assets or classes of work. The needs assessment task identified areas where expanding or further integrating these capabilities would add value to asset management decision processes and drew conclusions about which analytical support functions are highest priority candidates for new or improved tools. Review of Existing Relevant Research and Tools After the needs assessment, a review of existing research and tools was conducted to ensure that this project would complement and build on the extensive base of experience and resources. The review examined work in five categories: • Decision-making frameworks and practices for asset management and performance-based planning, • Benefit/cost analysis or multiobjective ranking tools for individual projects or strategies, • Life-cycle cost analysis procedures and tools, • Investment analysis tools that can generate needs and work candidates based on engineering and economic cri- teria and assist with analyzing the relationships between investment levels and system performance, and • Tools that can display and analyze integrated informa- tion across multiple management systems. In each of these categories, the review included tools designed for network-level, program-level, and project-level analysis. Collectively, these existing tools and research efforts pro- vide an extremely strong base on which to build. This research endeavored to take advantage of the knowledge gained from these efforts to advance the state of the practice. Application of modern software technology provides tremendous oppor- tunities to create a new generation of tools that are more flex- ible, modular, and adaptable to different needs and environ- ments than those developed in the past. Tool Development The final tools were developed in the following stages: 1. Conceptual design and rough development costing analysis, 2. Selection of tools for further development, 3. Requirements specification and detailed design,

7Process Methods Analytical Support Tools Evaluate Investment Levels and Tradeoffs • Back-of-the-envelope analysis of budget level versus output • Queries to database with average costs per unit of output (e.g., miles of resurfacing, square feet of deck area for bridge replacement) • Bottom-up method: identify projects within a set budget limit and estimate aggregate output and performance impacts • Network and sketch planning tools to assess impacts of multiple projects • Optimization/ Simulation – project level • Tools that select an optimal set of projects to meet a defined budget or performance target and that report both specific projects and aggregate costs and performance impacts of the selected projects • Optimization/ Simulation – network level • Tools to analyze performance versus cost tradeoffs at an aggregated level (not location-specific) Identify Needs and Solutions • Informed engineering judgment • Database and GIS queries of condition and performance • Application of standards, warrants, or rules of thumb for deficiencies and preferred solutions • Automated identification of deficiencies and solutions based on inventory and inspection data • Database and GIS queries of deficiencies based on standards • Simulation/Optimization • Automated identification of deficiencies and solutions, and recommendation of preferred solution based on economic criteria or decision rules Evaluate and Compare Options • Informed engineering judgment • Queries of “knowledge base” on strategy costs and impacts • Template to display “guesstimates” of strategy costs and impacts • Queries of specialized database(s) with average costs and service lives for different strategies • Simulation of alternative activity profiles over time • Automated calculation of equivalent uniform annual cost, net present value • Queries of specialized database(s) with average costs and impacts for different strategies • Automated calculation of strategy impacts, benefits, and costs • Automated calculation of strategy rating/ranking given set of objectives, performance measures, weights, and impacts • Life-cycle cost analysis • Benefit/cost analysis • Multiobjective ranking • Multiobjective impact tableau • Queries of specialized database(s) with average costs and impacts for different strategies • Tools to predict likely impacts of different strategies (e.g., network models, sketch-planning tools) • Template to display strategy impacts for consistent set of performance measures TABLE 1 Asset management methods and analytic support tools

4. Development of fully functional prototypes, 5. Field-testing, 6. Refinement based on test results, 7. Documentation, and 8. Product delivery. Task Summary The following tasks composed the work plan for this research: 1. Develop Needs Assessment Methodology, 2. Conduct Needs Assessment, 3. Review Existing Analytical Procedures and Software, 4. Recommend Tools for Development, 5. Interim Report on Tasks 1-4, 6. Preliminary Design and Test Plan, 7. Interim Report on Task 6, 8. Revised Design and Prototype Development, 9. Technical Memo on Task 8, 10. Field Test Prototypes, 11. Tool Refinement, and 12. Final Report and Tool Delivery. 1.3 CONTENTS OF REPORT This report is the deliverable for Task 12; it documents the findings of all tasks of the research effort. 8 Section 2 summarizes the needs assessment methodology and its findings, including the survey of states and the litera- ture review (Task 2). Section 3 summarizes the findings of the review of exist- ing analytical tools and software (Task 3). Section 4 compares the identified needs to the existing tools to identify gaps in current capabilities and describes the process by which concept plans for new tools were rec- ommended (Task 4). Section 5 describes the tools that were developed (Tasks 6, 8, and 11). Section 6 describes the testing process (Task 10). Section 7 presents recommendations for future research on analytical tools for asset management, including work to fur- ther enhance the tools and encourage their adoption. Appendix A presents summaries of the detailed agency survey results conducted for Task 2. Appendix B presents summaries of the existing analytical tools reviewed for Task 3. User guides for AssetManager NT and AssetManager PT were prepared as companion documents to this final report. A companion CD includes the appendices to this report, the two user guides, and copies of the tools. This CD also includes a copy of draft XML schema developed as a start- ing point to describe data requirements for the asset man- agement performance tradeoffs domain.

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TRB’s National Cooperative Highway Research Program (NCHRP) Report 545: Analytical Tools for Asset Management examines two tools developed to support tradeoff analysis for transportation asset management. The software tools and the accompanying documentation are designed to help state departments of transportation and other transportation agencies identify, evaluate, and recommend investment decisions for managing the agency’s infrastructure assets.

The software tools associated with NCHRP Report 545 are available in an ISO format. Links to instructions on buring an .ISO CD-ROM and the download site for the .ISO CD-ROM are below.

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Download the NCHRP CRP-CD-57.ISO CD-ROM Image

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