As a growing global player, South Africa needs Smart Cities. A sound asset management system such as described in ISO 55000 will be required to ensure that Smart Cities maintain reliable infrastructure to fulfill the needs of city dwellers.
Pragma’s Nico Mabaso, Executive Director: Sales and Marketing says the concept of Smart Cities is the modern approach to provide traders with a complete infrastructure base to stimulate and sustain competitive trade. “Urban performance depends on the city’s endowment of hard infrastructure and on the availability and quality of knowledge communication and social infrastructure. The term infrastructure indicates business services, housing, leisure and lifestyle services, transport, and information technology with an emphasis on a wired city as the main development model and on connectivity as the source of growth.”
This infrastructure is run on physical assets that require Whole of Life Asset Management (WOLAM) that will result in sustainable cities. WOLAM is an integrated asset management framework intended to manage physical assets from ‘cradle to grave’.
The South African challenge
Mabaso comments that South African cities are currently characterised by substantial infrastructure aging and decay.
“Since 1994, the government focused on providing much-needed basic services such as healthcare, water and electricity in rural areas, neglecting general upgrades and maintenance on current infrastructure. This led to decay, which in turn resulted in increased CAPEX spent on new infrastructure developments.”
To deal with this challenge, the government came up with regulations such as the Government Infrastructure Asset Management Act of No.19 of 2007, which has the following aims:
- To provide for a uniform framework for the management of an immovable asset that is held or used by a national or provincial department
- To ensure the coordination of the use of an immovable asset with the service delivery objectives of a national or provincial department
- To provide for issuing of guidelines and minimum standards in respect of immovable asset management by a national or provincial department
- To provide for matters incidental thereto.
This is also supported by pieces of legislation such as Guidelines for Asset Management of Local Government, Generally Recognised Accounting Practices 17, Municipal Finance Management Act and Public Management Finance Act.
The asset management challenge
Mabaso is of the opinion that these pieces of legislation are efficient for accountability purposes, but don’t provide enough detail to show the asset owner and user what to do to comply with minimum standards.
“In contrast, industries have been pressurised by the global economic meltdown to start appreciating better value of their current physical assets. This has led to the advancement of physical asset management from being engineering’s maintenance nuisance to an executive strategic imperative and major profit driver. In the case of the public sector, sustainable infrastructure asset management has proved to be an investor confidence booster,” says Mabaso.
A global asset management standard became necessary and ISO 55000 was developed. It has been supported by the Global Forum on Maintenance and Asset Management (GFMAM) and various global member bodies of which the Southern African Asset Management Association (SAAMA) is a part.
The South African Institute of Civil Engineering (SAICE) issues an annual Infrastructure Report Card (IRC) that evaluates and grades the current state of the South African infrastructure. This report is a collective opinion provided by civil engineering professionals at SAICE in the manner of ‘expert witness’ on the current condition of these assets. The 2006 report gave South Africa a D+ grade for that year, which improved to a C- in 2011. The positive gains were as a result of intense infrastructure development influenced mainly by the Soccer World Cup of 2010. The losses came as a result of poor maintenance on the existing infrastructure.
Working towards Smart Cities
Mabaso is of the opinion that “all is not doom and gloom”. “Various municipalities such as Ekurhuleni Metropolitan Municipality, Johannesburg City Parks and Zoo, eThekwini Metropolitan Municipality (Electricity) (EMM), Nelson Mandela Bay Municipality and City of Cape Town have identified that sustainable service delivery is based on sound physical asset management practices that align with and support broader municipal strategic objectives,” he says.
“A senior manager at EMM is currently pioneering the integrated asset management solution for their city with the intent of breaking historic silos of each operational unit functioning independently and finance and engineering misalignments. Nelson Mandela Bay’s electricity distribution has mastered the integrated service delivery model where customers directly influence asset maintenance through a call centre system that interfaces with an Enterprise Asset Management System. eThekwini Electricity have intensified their investment in the Smart Grid and are longstanding quality management leaders having already acquired the ISO 9000 and 14001.
“Cape Town’s MyCiti project is proving to be a winner in demonstrating the efficiencies in transport system integration. The city has succeeded in the integration of air, land and sea transport. This means that one can land at Cape Town Airport, catch a bus to the V&A Waterfront and be on a ferry to Robben Island. Although this is not fully integrated in terms of being done on a single ticket, it’s streamlined.”
The National Development Plan has also identified all the components of a Smart City as key developmental points, which means that South Africa is on the verge of being globally competitive.
“The Smart City concept is upon us and South African cities have the basic infrastructure to be African pioneers of this, but only if we manage internal bureaucracy and view asset management as a strategic imperative and not a compliance nuisance. The alignment of local legislation with International Best Practice on Asset Management is bound to make South African cities globally competitive,” concludes Mabaso.