1

Making Asset Management Active with Analytics

April Hutchen a.hutchen@seamsltd.comPhil McFarlane – Electricity North West

2

Agenda

• Benefits - why use Analytics?• Overview of Analytics in Asset Management• What is required?• Dashboards, Reports & Visuals• View from the industry

– Electricity North West’s journey– ‘What if’ scenario modelling’

• Break-out Session - ‘what if’ questions• Close

3

Benefits of Prescriptive Analytics

• 7-17% cost savings compared to a triggered or prioritised approach to planning

• Defensible business plans & budgets• Reduced planning costs• Improved customer service levels• Achieve key KPIs, both regulatory and non-

regulatory, at lowest whole life cost

4

IAM Asset Management Anatomy

5

What is needed?

1. Data – asset health, intervention (cost/benefit), faults, project– Source systems, expert opinion, best practice and data infill

2. Way to analyse information – spreadsheets, software, agreed processes

3. Business Objectives & KPIs – regulatory & non-regulatory4. Business commitment & buy-in from key personnel5. Means to understand and present the information

What is Analytics?Analytics is the use of data to deliver insight & support better decision making• Analytics is a combination of mathematics & statistics, data techniques and

advanced algorithms to quantify and predict performance, risk, condition, service, cost & revenue with rich data visualization to communicate insight

• Successful Analytics projects rely on the experience and expertise of specialists to enable the organisation to understand their data, use it to generate value and communicate effectively to stakeholders

6

7

DESCRIPTIVE

PREDICTIVE

PRESCRIPTIVE

STRA

TEG

ICTA

CTIC

ALO

PERA

TIO

NAL

What happened to our assets in the last 10yrs?

What happened to our assets in the last year?

What is happening to our assets today?

What will happen to our assets in the next 25yrs?

What will happen to our assets in the next year?

What will happen to our assets tomorrow?

What are the future needs of our assets?

What do we need to do to our assets this year?

What activities do we need to tomorrow?

• Historic asset trends • Performance• Reliability• Utilisation

• Demand profiling

• Asset deterioration• Forecasting Risk• Sustainability• Climate impacts

• Long term investment scenarios

• Financabilty • Risk mitigation &

management• Revenue modelling• Supply & Demand balancing• Asset policy

• Customer trends & preferences

• Annual cost & revenue reporting

• Unit cost analysis• Asset reliability & utilisation• Root cause analysis

• Real time monitoring of assets

• Operational efficiency• Early warning of faults• Rapid response to asset

issues• Asset survey

• Reliability analysis• Forecast annual performance• Management account

forecasts• Resource gap identification• Seasonal impacts

• Annual investment scenarios• Annual targets• Assets maintenance planning• Asset utilisation planning• Resource planning• Contractor & purchasing

planning

• Issue identification• Hotspot analysis• Client feedback

analysis• Peak demand forecasting• Weather impacts

• Optimise proactive Investment

• Prioritise reactive Investment• Job scheduling• Customer notification process

Describing Analytics – Analytics Matrix

8

Definition of Prescriptive Analytics

• “…the application of logic and mathematics to data to specify a preferred course of action. While all types of analytics ultimately support better decision making, prescriptive analytics outputs a decision rather than a report, statistic, probability or estimate of future outcomes.”

• Gartner predicts that its use will grow from 10% of organizations today using some form of prescriptive analytics to 35% by 2020, making it the fastest growing category of software.

9

Analytics & Optimisation Process

Analytics & Optimisation Process

11

Understanding & Presenting Information using

Dashboards, Reports & Visual Tools

12

Sample Strategic Dashboard – Risk Matrix

13

Dashboard – Scenario Comparison

14

Water Interventions Dashboard

• Distribution Mains

15

ASKING THE RIGHT QUESTIONS

Electricity North West – Phil McFarlane

16

Introducing Electricity North West

4.9 million

23 Terawatt hours

2.4 million

£12 billion of network assets

56 000 km of network l 96 bulk supply substations 363 primary substations l 33 000 transformers

17

Risk Matrices

18

Electricity North West

• Began a journey 12 months ago to understand & implement prescriptive analytics

• Started with a pilot looking at cross asset optimisation across 4 asset classes

• Objectives of the pilot were to understand:– Expected benefits of prescriptive analytics for a DNO– Different optimisation techniques – Benefits of refurbishment options versus replacement

across different asset types– Savings that can be found compared to the current

approach– Run different investment planning ‘what if’ scenarios

19

Asking the right questionsSample questions asked during the pilot:

1. Maintain current risk at least total cost. (Baseline scenario)

2. What is the optimal plan with a 5% reduction in expenditure?

3. What is the optimal plan with a risk reduction of 10%:1. By asset category?2. Across multiple asset classes?

4. What is the best risk score with an annual budget cap?

Constraints considered – budget, resource and skill availability

20

Dashboards

21

Group Workshop

• What would the most useful ‘what if’ questions be for your business?

• Do you have the data and processes in place to look at implementing analytics?

• Why?

22

Making Asset Management Active – in Summary• Benefits - why use Analytics?• Overview of Analytics in Asset Management• What is required?• Dashboards, Reports & Visuals• View from the industry

– Electricity North West’s journey– ‘What if’ scenario modelling’

Questions?

April Hutchen - a.hutchen@seamsltd.com