Setting the Decision Making Framework for Municipal Asset Management

Asset management by municipalities is characterized by a large variety of assets serving the needs of many different stakeholders. Given that the stakeholders may have conflicting values, asset management is not only balancing costs, performance and risk but also balancing different stakeholder needs. This increased complexity is further enhanced by the limited space in an urban environment, notwithstanding the competition for resources with non-asset departments. To deal with these challenges, many municipalities use a form of compartmentalization, limiting the scope of decisions. However, any compartmentalization introduces inefficiencies and may even result in net destruction of value because of missed interests. A way to address these challenges is to have a uniform decision making framework based on a broad view on stakeholders interest. In this paper we describe the approach that was followed by the city of Rotterdam including the results. Starting point in this approach were active policy documents. These were translated into a set of guiding principles and a value framework using state of art insights. The results were validated within the asset management organization with hands-on pilots on actual cases. Key elements in the approach were communication and collaboration with the entire organization and its partners.