Asset Management Period 6 (AMP 6) is now challenging water industry operators to change the face of their industry with the overall aim of making it run more efficiently, deliver a better level of financial return and provide improved customer service. Many people within the industry are now fully aware of the key changes that it will usher in, and of the demands it will place on the industry.

One of those changes is the new emphasis that is now being placed on deriving long-term value for money - and successful long-term outcomes - from the projects that are undertaken, and this is driving the need for a new approach from everyone within the industry. This new approach involves focusing on the total expenditure (TOTEX) of an installation over its lifetime, rather than the previous strategy of concentrating on the capital expenditure (CAPEX) costs initially, and then considering the ongoing running expenses further down the line. This is now becoming the water industry’s standard approach, with CAPEX costs and operating costs being considered as a single TOTEX expense, rather than being seen as separate entities.

The move to adopt this ‘whole-life’ holistic view is now driving a significant change in the relationship water companies have with their contractors and equipment suppliers. Everyone is now being encouraged to acknowledge that they have a responsibility to ensure reliable, effective and long-term performance, and this is causing those industry relationships to take on more of a partnership feeling than might previously have been the case.

The previous method of having a development team get a project up and running before handing it over to an operations team is now being phased out in favour of a wider, more integrated approach. All of the different parties in the process are now realizing that under the new approach they each have a stake in designing, building and operating the asset, and this means that operating issues are now being considered at the early stages of the design and build process. This allows each aspect of the project to be optimized to ensure that every stage – from design and build through to ongoing operation – is achieved as efficiently and cost-effectively as possible.

This is, in turn, causing contractors and suppliers to become involved with their water company customers at an earlier stage than previously, and to contribute right from the planning stages – something which they might not always have done previously. Many would agree that this is a good thing since it allows these parties to embrace wider issues than before, and to balance those issues – maintenance, operational, future upgrades etc - when they are proposing or developing product packages for their customer. This is now prompting suppliers to be more innovative, and to develop increasingly creative solutions to their customer’s requirements.

As a result of this, equipment manufacturers now need to take a long hard look at what they provide to water industry operators and begin to tailor their solutions accordingly. For example, operators are facing increasing pressure to shorten build times. This creates an opportunity for the equipment manufacturer to contribute by offering integrated product packages which can be installed and commissioned much more quickly and easily than a whole string of individual items.)

These packaged solutions would naturally be individually tailored to suit each individual customer’s needs. For example, a solution supplied to a wastewater treatment operator might include a pair of duty/standby pumps, appropriate motors, thermistors, heaters, anti-dry run devices, gate valves and all the necessary connecting pipework, all completely integrated together, skid-mounted and supplied ready for installation.

There are also other advantages in this type of ‘packaged products’ solution approach. Such integrated packages can offer the end-user better energy consumption – something which helps cut long-term operating costs and is in line with the TOTEX approach.

Manufacturers must also go beyond the products themselves in terms of the support they provide to customers. Building Information Modelling is a good example of the value they can add to a project by providing application drawings in whatever format the customer requires. This allows the customer to create accurate and detailed virtual representations of the application so that every aspect can viewed and assessed. These can be shared by the various parties involved to support every stage of the decision-making process.

Assembling product packages offsite is also an important factor. This approach has been used for many years in the construction industry and has been proven to help improve construction schedules – a benefit which can certainly be transferred to water industry projects.

This also provides longer term advantages for the equipment manufacturers. In addition to helping their customers adapt to a changing industry landscape, they themselves will benefit from the need to adopt an innovative approach to the products they provide. This will drive their efforts to extend the life expectancy of their products (and the assets they are installed in) and to increase the efficiency in which they satisfy customer requirements.

As the TOTEX approach continues to drive the increasing use of partnerships and alliances, other opportunities may also arise for equipment providers. Water companies may look to outsource more and more of their technical support, and any manufacturer who has demonstrated their competence in this area will be well placed to take advantage of this situation.