Three things the water sector can learn from aerospace

Sachin Sachdeva, managing consultant in the business consulting group of MWH Global, now part of Stantec.

The UK water sector faces a number of challenges and in addressing them it should look to learn some lessons from the aerospace sector, says Sachin Sachdeva

Water companies have made remarkable progress to address myriad challenges, including a diminishing and unpredictable water supply due to climate change, ageing infrastructure, changing regulation, a retiring workforce and limited funding.     

However, there is a growing consensus that to ensure continued water security in the future with reasonable levels of investment, water companies will have to find innovative ways of delivering outcomes sustainably. 

These imperatives are not unique to the water sector; lessons from other sectors can be learned. There is increasing interest within the water sector to adopt solutions and best practices that have proven effective elsewhere. One such sector worth looking closely at is aerospace. 

Like the water sector, the UK aerospace sector is highly regulated. What’s more, it is considered world class, if not world leading, in terms of innovation and operational effectiveness. 

There are three lessons the water sector should take note from the aerospace sector: 

Research and Development (R&D) – The UK aerospace sector spends approximately 8% of its turnover in R&D. In contrast, the R&D spend for the water sector is less than 0.5% of its turnover and the overall spend has been falling due to focus on short-term outcomes through five-year Asset Management Plan cycles. 

Water companies should consider increasing their R&D spend and developing strategic partnerships with the other water companies and research institutes. They should take a long-term view and lobby together to influence the regulator to incentivise medium to long term R&D investments, particularly in the areas of carbon reduction and sustainability. 

Asset and data management – Aerospace companies use advanced techniques to monitor performance of their assets as failures can cost billions and human lives. Rolls Royce’s Engine Health Management (EHM) tracks the health of thousands of engines operating worldwide. EHM has significantly reduced the cost of maintenance by optimising schedules and increasing engine availability by dispatching parts and engineering teams to the destination to fix any issues, even before the plane has landed. 

Data analytics present tremendous opportunities to the water sector - water quality assessment, leak detection, flood warnings, to name a few. Data can be analysed to enable optimal utilisation of plants, machinery and resources, help companies better prioritise their investment decisions, and improve overall customer experience. 

Collaboration – The aerospace sector has been driving innovation and product development through extensive collaboration. GE and Rolls-Royce use risk and revenue sharing partnerships (RRSPs) to spread the risks and rewards across the supply chain during the life of a product. This has many benefits, including allowing partners to draw and build further on their expertise, driving efficiency and incentivising innovation across the supply chain, encouraging best practice sharing and reducing waste. 

Some water companies have used strategic alliances - Thames Water’s eight2O alliance for example - which brings together expertise from multiple sectors to deliver a common set of outcomes. However, it falls short of the aerospace RRSP model since alliance partners are not liable for long-term performance. The RRSP model could bring real value for all stakeholders in the water sector considering the assets have long life, are capital intensive and, like in the aerospace sectors, they are developed and deployed by an extended supply chain.   

There are multiple drivers for change and the water sector is already transforming. However, in order to become world class, companies within the UK water sector need to collaborate extensively across the corporate boundaries; develop long term investment strategies; and accelerate the pace of innovation and adoption of technologies proven elsewhere.

Sachin Sachdeva is a managing consultant in the business consulting group of MWH Global, now part of Stantec.