Ensuring the resilience of water and wastewater services is emerging as a key issue for the water sector.
It is not the only industry to experience this. The theme of resilience is focussing the minds of many involved in the planning and delivery of vital public services. The focus reflects underlying concerns in many developed economies that essential services may be vulnerable to significant disruption caused by a sudden shock or long term stress that systems are unable to absorb.
Since the 2014 Water Act, resilience has gained prominence the agenda in the water sector, as the Act introduced a statutory resilience duty for Ofwat. The aim of the regulator is to ensure resilience of water and wastewater services in the face of the ongoing issues of population growth, shifts in customer behaviour, climate change and other environmental concerns. Ofwat will expect greater insight into current levels of service resilience as well as assurances that companies’ long-term plans and performance commitments embed service resilience for the future.
What do we mean by resilience?
Resilience is a broad concept encompassing qualities of strength, flexibility and responsiveness to a range of external shocks and stresses. Achieving a common understanding within the water sector is an important first step in addressing the challenge.
Ofwat supports the definition which emerged from the 2015 Task and Finish Group, chaired by Jacob Tomkins which defined resilience as “the ability to cope with, and recover from, disruption, and anticipate trends and variability in order to maintain services for people and protect the natural environment, now and in the future”
There are two important points which emerge from this definition. Firstly, the emphasis on “trends and variability” reflects the need for service providers to cope with insidious, long-term changes not simply recover from sudden catastrophic events. Secondly, the focus on maintaining services, prompts us to adopt a broader perspective that considers the wider mechanisms and interactions that enable services to be delivered rather than focus narrowly on the resilience of individual assets.
Even with a common industry wide definition there is much work for companies to do to understand the implications of that definition for their business and crucially for their customers. A key consideration in this regard is ‘what do services need to be resilient to?’ Services in some communities may be highly resilient to population growth and the impacts of flooding or extreme weather but extremely vulnerable to critical asset failure or failure of 3rd party systems such as power or communications. The supply-demand resilience of water supply services may be diminished if production capacity is constrained due to deterioration or variability in raw water quality
The cornerstone of an individual water company’s approach to service resilience must be having full sight of how the services it provides can be impacted by these myriad pressures. Consideration has to be given to the complicated interconnection of assets, catchments and organisations (people, systems and processes) which collectively maintain service delivery, resisting and reacting to the threats and pressures to which those services are exposed. This is not a simple undertaking; it demands input from right across the water company, working across the siloes which inevitably exist within such complex organisations.
Where are we now?
It is no accident that significant service failures in the water industry are rare and catastrophes rarer still. It is testament to the operational and engineering skills in the sector and its ability to manage incidents and protect customer service. Nevertheless there is plenty of anecdotal evidence of near-misses, those events that could have tipped over into a major service failure if they had happened at a different time of day or the year. In some areas ‘incident management mode’ is becoming the norm rather than the exception. There is therefore no cause for complacency and the industry needs to ensure and demonstrate that its ability to maintain service is not under threat.
As such, companies should be able to answer the following key questions with an unequivocal ‘yes’.
• Do we have clear visibility and understanding of every significant pressure which have the ability to impact on our services?
• Do we understand the level of vulnerability of services across our ‘value chain’, to the impacts of such pressures?
• Are we confident in our capability to maintain or restore service in response to those impacts, in a way which our customers would consider to be acceptable?
The reality for most companies is more likely to be a qualified ‘yes’ with answers informed more by assumptions than thorough investigation and insight. Given that the regulatory environment is shifting towards a sharper focus on resilience, water companies must take steps to ensure that if they cannot answer the three questions with a definitive ‘yes’ they must at the very least be able to know where the gaps are and be able to demonstrate that they have plans in place to reach the levels of resilience demanded by stakeholders.
How do we build resilience?
One of the tools that can help to bring some structure and focus to the challenge of assessing and building resilience is the BSI publication, Guidance on Organisational Resilience (BS 65000 2014), which sets out six key steps required to build resilience. Interpreting those key steps in light of the water industry resilience challenge would raise the following considerations;
• Direction – has the business identified the pressures which are likely to impact on service now or in the future and defined service resilience objectives?
• Awareness – are pressures monitored and reported at an appropriate frequency and granularity?
• Alignment – are resilience objectives cascaded thorough the organisation with appropriate policies and targets for all functions and disciplines?
• Learning – learning from incidents is important but equally important is ensuring time and space to think about what might happen; think the unthinkable; capture near misses; listen to experts and learn from other sectors
• Strengthening – learning isn’t beneficial if it doesn’t lead to action; there must be robust processes in place which allow resilience improvements to be evaluated; promoted and adopted by the business, creating a business-wide culture of resilience thinking
• Assuring – the business should openly test and challenge whether existing risk mitigations such as contingency plans are robust and reliable
How do we create a culture of resilience?
Water companies don’t wilfully ignore known or evident risks to service but inevitably choices have to be made about where and when to invest and in an increasingly customer outcomes focussed industry. Cases which represent an imminent threat to service will tend to make the greatest claims on available funding. The low probability but high impact events that often characterise resilience risks may struggle to gain attention, particularly if the investment needed to address them is significant.
It may therefore seem to go against the prevailing culture to proactively identify such cases if the expectation is that they will tend to be deferred to some unspecified future date for investment.
However, responding to the resilience challenge requires a more transparent approach to such risks, separating the issue of risk identification and reporting from the issue of how they will be addressed. The leadership team in a water company should have full visibility of such risks and can then initiate long-term plans to address them whilst identifying how those risks can be mitigated in the interim. This insight can underpin a much richer dialogue with customers and it is clear that informed customers are generally supportive of improving the resilience of their services.
How then, can this new resilience culture be embedded into an organisation and put into practice? There are several ways to do this:
• Create the processes and forums within the business that enable stakeholders to flag up resilience issues
• Ensure that these learning opportunities are put to use, enabling changes in planning and operating processes to follow
• Encourage staff to think of resilience issues in the way they do health and safety – capturing ‘near misses’ and looking to build the behaviours which will enhance resilience and reduce vulnerability
• Channel this information to build a complete multi-stakeholder view of the range of pressures and vulnerabilities to which water and wastewater services are exposed
If companies adopt a framework like this, they will be in a good position to identify strategic resilience objectives and develop robust solutions.
Conclusions
The focus on resilience provides the water industry with challenges and opportunities. The challenge will include how to demonstrate to the regulator what existing levels of resilience are and to make the compelling case, supported by customers, for enhancing resilience. The opportunities though, are significant, not least embedding long-term planning and operational policies which harness the knowledge and expertise of the sector to secure exceptional levels of service reliability for the future.
As an industry, we want to be proactive, in building service resilience as part of long-term plans. The resilience agenda will not diminish the inevitable tensions between performance expectations and affordability – but that should not be a barrier to tackling the issue head on.
Brendan McAndrew is a Principal Consultant at MWH, now part of Stantec. MWH is supporting clients across the UK to develop practical approaches to building resilient services, enabling them to meet the regulatory challenge and secure the trust of their customers now and into the future.
