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Matt Jesson delivered the presentation at the 2014 ADM Defence Support Services Summit. The 2014 ADM Defence Support Services Summit had a theme and focus on ‘Leveraging constructive partnerships for optimised defence support' and examined government policy, current legislation, non-materiel procurement and defence/industry engagement, in building a long term strategic outlook for defence support in Australia. For more information about the event, please visit: http://bit.ly/defence14
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Spending Money Where it Matters
The State of the Estate
Matt Jesson - AECOM ADM Conference | 10 September 2014
State of the Estate | September 2014
State of the Estate
Agenda • State of the Defence Estate
• Evidence Based Decision Making
• Visualisation: Cost Forecast Modelling
• Integrated solution
• Questions
The Defence Estate
State of the Estate | September 2014
State of the Estate
72 Significant bases one of the largest real estate portfolios in Australia.
$74B The Defence Estate has a gross replacement value of $64 billion.
3M Environmental stewardship of over 3 million hectares of land.
25K Around 400 owned properties, maintains and operates more than 25,000 buildings and 6000 other structure assets.
From: http://www.defence.gov.au/id/ID_Introduction.asp
State of the Estate | September 2014
The Current Defence Estate • Unaffordable
• Aging; Risk of Failure
• Challenges with Compliance
• Incomplete or inconsistent data
State of the Estate | September 2014
Challenges
• Multiple systems
• Contracting resources
• “Turning the Titanic”
State of the Estate | September 2014
The Perfect Storm?
DCP and multiple new platforms Retiring of DEMS
Resource Constraints
Declining Overall Estate Condition
2015 White Paper
Force Posture Review
Plan Beersheba
Increased Compliance (ie WHS)
Difficult Base Rationalisation Decisions
Strategic Reform Program
Evidence Based Decision Making
State of the Estate | September 2014
Where does our information come from?
State of the Estate | September 2014
Above Ground Assets
State of the Estate | September 2014
Inground Assets
Visualisation: Cost Forecast Modelling
State of the Estate | September 2014
A Perfect World
Where do I get optimum economy of effort? • Funding Priorities - Identifying the “Stitch in Time”
Premium paid to meet cost target.
Premium paid to meet reliability target.
Ann
ual C
osts
($)
Renewal Frequency (years)
RISK COST ECONOMIC OPTIMUM
DIRECT COST
State of the Estate | September 2014
Prioritisation Mean Risk of Failure
State of the Estate | September 2014
Prioritisation – Estate Level
RAAF Base Tindal HMAS Cerberus
Bulimba Barracks RAAF Base Scherger
HMAS Harman Gallipoli Barracks Steele Barracks
HMAS Watson Puckapunyal Military Area
Mean Risk of Failure
State of the Estate | September 2014
Prioritisation – Base Level
Electrical
Airfield Pavement
Airfield Lighting Air Traffic Control
Carparking
Sewer Water
ICT
Accommodation
Mean Risk of Failure
State of the Estate | September 2014
Prioritisation – Asset Level
Substation 1
HV Cables
Substation 2
LV Switchboard 1
Incoming Switching Station
Substation 3
Substation 4
Substation Security
LV Switchboard 2
Mean Risk of Failure
State of the Estate | September 2014
CAPEX Projection, Prioritised by Risk Failure
Do Nothing
Scenario A
State of the Estate | September 2014
What Level of Risk is Acceptable?
State of the Estate | September 2014
What Level of Risk is Acceptable?
LEVELS OF SERVICE Capability Based
CRITICAL ELEMENTS
State of the Estate | September 2014
CAPEX Projection, Prioritised by Risk Failure
Target Level of Service
State of the Estate | September 2014
CAPEX Projection, Prioritised by Risk Failure
Redevelopment Opportunity?
Scenario B
State of the Estate | September 2014
Projected Condition Forecasting
• Operational Impacts?
Integrated Solution
State of the Estate | September 2014
Integrated solution ..
INTEGRATION Financial Model
TASMIS
BEAP
BIM
BSC
GEMS
• Visualise and scenario plan the ‘State of the Estate’
• Support Evidence Based Decision Making
MCFP
Estate Planning
Budget Planning
Other Key Decisions
Questions?
Matt Jesson ADM Conference | 10 September 2014
