In September Ofwat published Resilience in the Round, their report which emphasised the evolving importance the theme of resilience will have in the next price control, PR19. The report outlined the need for water and wastewater companies to include resilience in their planning models and build resilient networks for the future. If you didn’t find the time to read the entire thing – and it’s a good read – here’s a quick summary of what the report contained.
Ofwat places resilience in the context of multiple challenges, ranging from cyber-attack to climate change, and increasing intensity and unpredictability of those challenges. If water networks aren’t resilient, the report explains, we can expect the risk of “destructive and disruptive asset failures” and face “an inability to cope with floods, droughts, and other natural hazards”. In this context, resilience needs to be addressed across three broad axes: corporate, financial, and operational. Crucially, Ofwat doesn’t suggest addressing these three axes separately; rather, it advocates addressing them concurrently and approaching the entire issue of resilience holistically.
Ofwat calls this holistic approach ‘systems thinking’, arguing that to achieve resilience
“it will be vital for companies to have a better understanding of the interrelationships and inter-dependencies across the systems underpinning their service delivery”.
This systemic evaluation of interconnections between different company systems and inter-dependencies across networks of assets and people resonates with the team I have recently started working with at Cosmo Tech. The holistic approach to networks and systems-of-systems is core to the modelling and simulation software that we provide to water utilities, electric and gas utilities, and other businesses from the transport sector to bio-pharmaceuticals and life sciences.
How does this holistic approach help build resilience for water and wastewater utilities?
Though from outside they might appear to be a single corporate whole, every organisation is a dynamic system of sub-systems and interconnected parts. Decisions made in one part of the business can and do have impacts far beyond that part of the business. The interconnections across and interrelationships between different parts of the organisation mean that siloed thinking leads to siloed, rather than corporate optimisation. The ‘systems thinking’ approach, Ofwat believes, will help improve customer engagement, allow for better forward planning, and help generate better value options for long term resilience.
Ofwat isn’t alone of course; the need for systems thinking is increasingly well recognised. Just one other example, and a quote which I think sums it up, The Royal Society, in its response to House of Commons Environment, Food and Rural Affairs Committee inquiry into future flood prevention, stated
Systems thinking is central to the planning, design and maintenance of resilient infrastructure. It involves taking a holistic approach and recognising that vulnerabilities or failure in one sector can affect the whole system, potentially leading to a cascade of failures.
Importantly, adopting a systems thinking approach and taking the holistic view is just the first step on the road to enhancing resilience. While it’s both essential and fundamental, it is not in itself sufficient for building a resilient water or wastewater network. In the weeks ahead, I’ll look more closely at the concept of augmented intelligence, and how this can enable organisations to take better decisions which embrace, rather than ignore complexity.