1.2 County asset management logical framework

One remarkable shortcoming is that Kenyan national-level entities tend to focus on national policies and regulations more than on their functions in municipal, operation-level AM responsibilities at a national scale. The Public Debt Management Directorate in the National Treasury, however, has been managing national public debts vis-à-vis foreign creditors daily. In contrast, ministries or the NALM seem to be focused so far on policy setting and regulatory roles without a solid vision or plan to fulfill specific AM functions.

County asset management logical framework

The asset management logical framework (figure 1.2) is a hierarchical and perpetual cycle of AM that includes four quadrants: vision, strategy, planning, and operation: (1) The vision quadrant includes the county vision summarized in strategic plans, master plans, or detailed zoning or development plans; (2) the strategy quadrant contains the county AM policy, which regulates overall AM activities in harmony with national laws and regulations and the county vision, and the county AM strategy adopted for the long term (10 years or longer) in harmony with the county strategic plan, master plan, and other respective detailed plans; (3) the planning quadrant includes entities, systems, and activities such as demand management, life-cycle AM, capital improvement planning (CIP), and respective financial management; and (4) the operation quadrant includes the annual county AM plan,

FIGURE 1.2

County asset management logical framework

Vision

Strategic plan Master plan Spatial plan CIDP Strategy

AM policy AM strategy

Annual AM plan Development Floor-level AM O&M

Operation Demand management Life-cycle management CIP Financial management

Planning

Source: World Bank. Note: AM = asset management; CIDP = County Integrated Development Plan; CIP = capital improvement planning; O&M = operation and maintenance.

the floor-level AM entities, systems such as registers, logbooks, and procedures, and asset development and daily management of asset operation (Ottawa 2012; Cambridge 2013). In the following sections we discuss first the key building blocks of the county AM framework by following the quadrants of the circle of figure 1.2.

Vision quadrant. The county vision is the top layer of the county AM logical framework; the vision is summarized in the county strategy or strategic plan, the master plan, the County Integrated Development Plan (CIDP), or possibly in zoning or detailed development plans. Each building block of the AM framework should correspond to the vision, even though the vision often provides only distant and broad guidance to specific AM entities or procedures. The vision has the strongest effect on the substance, scope, and policy priorities of county AM policy and AM strategy. All subsequent quadrants of the AM framework are derived from or should correspond directly to the AM policy and strategy with more distant and indirect relation to the vision.

Strategy quadrant. Strategic-level AM consists of two important local legislative documents that summarize and rule AM policy and AM strategy, developed in correspondence with the national legislation (PFM Act 2012; UAC Act 2011; NALM 2020a, b, c). AM policy and strategy are local regulations or bylaws approved by higher governing bodies of the county (County Assembly or governor). They are published and made valid for long-term duration (10–20 years), with the possibility of revisions as changing local circumstances require (such as in response to the pandemic crisis). An AM policy stipulates rules and procedures and assigns mandates to entities and individuals to perform strategic functions or make strategic decisions (see templates for AM policy in appendix A and AM strategy in appendix B and DPLG 2006).

For example, a strategic function or decision could be to draft, discuss, and approve strategic-level AM actions such as acquisition or disposal of high-value assets or assets with strategic importance. Entities may include an AM directorate or team to complete the analysis and draft proposals for higher governing bodies such as the Finance Department, the Asset and Liability Management Advisory Committee that discusses and finalizes proposals, and the County Assembly and governor. The county AM strategy closely corresponds to the vision documents and stipulates specific strategic AM rules and planned actions in a long-term time frame, such as 10 years.

Planning quadrant. The medium-term level, in contrast, includes key mediumterm planning building blocks: (1) demand management needs a dedicated analytic team and procedures to explore and quantify the demand for particular services (for example, a school or water); (2) life-cycle AM is an approach but also a role to be fulfilled by various teams in planning, finance, and service departments and in various phases of a life cycle, such as planning, selecting priority projects (mediumterm planning such as CIP), comparing design-modalities, and managing repair, preventive maintenance, and refurbishment or disposition; and (3) financial management is a function fulfilled by the Finance Department and other AM teams in the various phases of the asset life cycle, which includes least cost analysis, financial analysis, funding plans, and liability analysis.

Demand management aims at enhancing the use and usefulness of assets by (1) analyzing trends and projecting future demand in key service areas, ideally in a consultative process; (2) defining adequate levels of services by comparing demand and current and future service options, scopes, and capacities; and (3) projecting demand, foreseen service levels, and projected capacities to support service enhancement programs by connecting priorities and funding capacities. (The life-cycle and financial AM will be discussed in more detail in later sections.)