the society for standards professionals how standards in plant operations will drive value creation...
TRANSCRIPT
The Society for Standards Professionals
How Standards in Plant Operations Will Drive Value Creation and
Competitiveness Among Global Manufacturers
Rich RobbenExecutive Director, Plant
OperationsUniversity Of Michigan
©2014 SES - The Society for Standards Professionals
Education Enterprise
• Universities need standards to operate properly.
• Standards for buildings,technology, teaching, and health & safety.
• Most industries rely on sector-specific standards, education requires a whole string of standards – spanning business, government and society.
Education Enterprise
• McKinsey & Company, a management consulting firm, helps leading organizations across the globe improve performance.
• Predicts just keeping pace with the projected global GDP growth will require an estimated USD 57 trillion in infrastructure investment between now and 2030.
Source: McKinsey & Company, Infrastructure productivity: How to save $1 trillion a year, January 2013
Education Enterprise
• This figure could be reduced by 10% to 20% if businesses and entire industries were more engaged in standards development.
• Campuses are a natural place to start because their “city within a city” characteristic makes them ideal study units for cities of the future.
An Unsung Industry
• Stewards of one of the largest assets owned by any community – its schools, colleges, universities and hospitals.
• European campuses’ square footage is integrated into the city.
An Unsung Industry
US campuses – particularly land-grant institutions – have real footprints of many square kilometres with their own energy production, telecommunications, water management and road systems.
An Unsung Industry
• Legally separate from the host community - risk aggregations and economic expectations are as complex as a mega-cap global corporation.
• Given this footprint it is not only logical but imperative that higher education engage in standard development advocacy.
Big and Small Fish
• Stewards tasked with leaving our campuses in better shape than we found them.
• Expected to “act like a business”.
• In the education world we lack one important resource: leverage.
Big and Small Fish
• General Electric - 1 of 300 members funding the USD 25 million NEMA.
• Develops technical standards supporting USD 120 billion electrical industry.
• Cost in every light bulb, motor and smart-grid gizmo bought.
• An industry ½ our size spends USD 25 million a year on global standardization and innovation processes.
University of Michigan Plant Operations
Plant Operation’s Mission Plant Operations, a member of the campus community, provides and sustains the physical environment for the University of Michigan to achieve its goals of excellence in education, research and public service.
University of Michigan Plant Operations
Our Code Advocacy Goals
• Serve the public user interest• Positively impact
competitiveness among global manufacturers
• Drive value creation for the End User
• Safer, Cheaper, More Reliable, Longer Lasting
University of Michigan Plant Operations
Why is U of M Here?
Current State • Very little end user participation in
the standards development process
• Process governed by Manufacturers/vendors and special interest groups
• The ANSI concept of a balanced of interests in standards development is being challenged
National Infrastructure Standards Strategy
•Since 1997, Plant Operations at the University of Michigan has been a leader in national infrastructure standards strategy for the $300 billion educational facilities industry.
•Advocate for the public user interest in regional, national and global standards development.
©2014 SES - The Society for Standards Professionals
Advocate for the Public User Interest
Our Actions• Advocate for Increase End User
Participation in the US National Standards arena
• Greater representation on technical committees of ANSI approved Standards Development Organizations - SDOs
• Review and comment on the continuous flow of new proposals appearing before SDOs
National Infrastructure Standards Strategy
Our Actions• Developing new proposals to SDOs
for inclusion into standards • Strongly Support Development of
new SDOs that will influence the Facilities Management Arena in the concept of Total Cost of Ownership - TCO
• Influence the code development process at the state, national and international levels.
©2014 SES - The Society for Standards Professionals
National Infrastructure Standards Strategy
Our Actions• Educate the education and other
sectors of new new standards language.
• Collaborate with trade organizations to multiply our efforts.
• Place University representation on Code Advisory committees within the state of Michigan.
©2014 SES - The Society for Standards Professionals
National Infrastructure Standards Strategy
Our Focus
• Total Cost of Ownership Safer, Simpler, Lower Cost, Longer Lasting
• Leading Practice Discovery
• Competitiveness of Suppliers
National Infrastructure Standards Strategy
Our Successes
•Participate on numerous standards development committees and currently maintain oversight of over 180 standards issues.
•Our advocacy efforts create an opportunity for conversation, debate and occasionally disagreement.
Advocacy for the Public User Interest
Noteworthy Advocacy Achievements
• Success in changing the 2014 National Electrical Code so that less electrical energy is brought into every building.
• Drives down the first cost of constructing the entire electrical power chain and reduces operational hazards significantly.
Noteworthy Advocacy Achievements
• Success in catalyzing the creation of an American national standard for the custodial industry.
• Significant reduction to the total cost of ownership when benchmarks have a national standard in support of public health and workplace safety.
ANSI - Balance & Incumbent Interests
Incumbent Interests
Incumbent producers and general interests – hold a strong market position – relative to the comparative sparseness of the user interest, especially from the public sector.
Producer & User/Enforcer
Manufacturers, insurance and labour organizations - weave the cost of their engagement in standards development activities into the product and/or service they provide to their “customer”.
Public Sector User Interest
At the opposite end of the spectrum, the public sector user interest – cities, counties, states, and large universities such as our own – face a much greater challenge.
User/Owner/Final Fiduciary
• Public safety
• Economic development
• Opportunity
• Lower cost and higher value
• User/owners
• Final fiduciary for safety and solvency
• Paying the cost for the consequences of standards or lack of standards
Two Tier System
• Standardization processes are the most efficient way to reconcile the competing requirements of safety versus economy.
• User/owner is not at these consensus meetings because they cannot afford to be at the scale of the incumbents.
Two Tier System
• UM study of global standards development bodies revealed almost all were short on user/owner participation.
• NSF International, Underwriters Laboratories and the National Fire Protection Association – pay travel costs of users, but only for user/enforcers, i.e. the conformity assessment professionals who will be using their documents.
Two Tier System
• Scarcity of the user/owner
• Who’s fault?
• ANSI President and CEO S. Joe Bhatia UM presentation October 2014,
“ If you talk to the CEOs and C-suite executives, they do not have any focus on this subject. Unless and until there is a major economic ramification: either a big order was lost or there was a lawsuit.”
Our Challenge
• No single organization represents the education facilities industry.
• Many non-profit trade associations that service the US education industry are “membership organizations ”.
• Business model - conflict of interest - at odds with producers and general interests.
• US tax code for 501(c)(3) non-profit organizations.
Responding to the Challenge
• Become accredited standards developers - use social media tools available to drive value into the industry.
• University of Michigan Model
How Trade Associations Can Help
UM is now the only university in our industry with a member appointed to the National Fire Protection Association Research Foundation—one of the highest positions of influence in our industry.
How Trade Associations Can
Help
• A workgroup is now in action to discover the degree University of Michigan may strengthen its leadership in infrastructure standards
• Engage proactively with all ANSI members that are stakeholders in our industry.
Market In Balance
• Material versus labour
• First cost versus life-cycle operation & maintenance
• Safety versus economy
• Increase participants and leading practice discovery
• Engage the education industry farther up the value chain
Market In Balance
Give national standards accreditation organizations their own ISO standard, which should enable them to identify the complexity of the infrastructure market and provide a framework for resolution of the market imbalance we now face.
Market In Balance
• Assertive engagement in global standards development.
• Link the ideals of the academy with practical business sense.
• To what degree can public sector infrastructure benefit from the engagement in standards development?
• To what degree do we fail in our mission if we do not try?