Enhancing Heathrow's asset management and investment strategy

Reevaluating asset investment planning for efficiency

Heathrow Airport is one of the busiest airports in the world, operating and maintaining over £18bn of infrastructure and technology assets to deliver a safe and efficient service. The Covid-19 pandemic, and a changing regulatory regime resulted in a need for a more joined up approach to asset management maturity and capability across different business functions. To enable the airport to operate effectively and fulfil its mission to provide travellers with the greatest airport experience possible, Heathrow wanted to re-evaluate its asset management and asset investment planning approach.

Readjusting and realigning its plans to react to changes and inform future investment plans mean that Heathrow required a strategic programme partner. Heathrow appointed Mott MacDonald due to its world leading asset management expertise across the engineering sector, as well as its strategic advisory capability to provide independent support. The services delivered by Mott MacDonald included business change, programme consulting, investment planning, setting up and implementing Heathrow’s asset management compliance (AMC) programme.

Heathrow also identified that enhancing digital maturity was a key enabler for improving efficient decision making and long-term investment planning capability.

The AMC programme is one of six programmes of work in the current regulatory period (H7), which runs from 2022 to 2027. Delivering the £4.7bn AMC programme while managing interface risk with other major programmes has been a crucial strategic consideration for our work. Our approach has reduced the potential impact on millions of passenger journeys and tonnes of cargo passing through the airport each year.

Integrating best practices for optimal outcomes

Mott MacDonald supported the design of the AMC programme by blending asset management best practice with managing successful programmes methodology. We reinforced stakeholder engagement with Heathrow’s operations and engineering teams, key supply chain partners, as well as internal stakeholders and partners, to reach universal support for the programme objectives, outcomes, and benefits strategy. Through our collaborative approach, we built on lessons learned from previous asset renewals and engagement as key to programme success.

We sought outcomes that improve residual asset life through more efficient renewals and sequencing, supported by an improved understanding of asset condition and qualitative insight from engaging key stakeholders. These capabilities are helping Heathrow to transition to a rolling lifecycle approach based on risk, maturity of scope and asset information such as performance and condition.

Our collaborative approach enhanced the delivery of the programme objectives, including:

• Sustained airport operations that are safe, secure, compliant and protect Heathrow’s revenues and help mitigate risk
• Efficient and timely programme governance approval
• Improved confidence in sustaining cost efficiency through programme design, with supply chain partners mobilised to provide agile capabilities, undertaking design and delivery in a more cost-effective manner
• Improved visibility of planned asset replacement works, reducing operational disruption and risk
• Improved collaboration across Heathrow programmes, engineering and maintenance and operational teams
• Improved scalability, adaptability, and control of investment into each asset across the portfolio.

The added value to Heathrow in establishing aligned and prioritised approaches to using systems and tools enabled them to identify programme challenges in good time, which reduced delivery risk. As a result, the AMC programme strategy and delivery approach has effectively become a” pathfinder” for other programmes at Heathrow Airport.

Building confidence in asset investments

We created a partnership that focused on design, governance, and strategic delivery. This enabled successful governance approval for the programme including the operating model and mandate for transformational improvements in capability for planning and delivery.

Our support has helped Heathrow to transition from discrete funding streams for asset renewal projects to a single asset renewal programme that uses a benefit-led approach to address delivery, prioritisation, and decision-making.

Through our collaborative approach and connected thinking, we added additional value by seamlessly integrating the AMC programme with other workstreams at Heathrow, beyond our role in the AMC programme, including:

• Facilitating supply chain engagement, supporting the development of the programme delivery model between design partners and asset renewal partners.
• Alignment with Heathrow’s carbon and sustainability vision, which is also being led by Mott MacDonald, to build carbon into the AMC programme benefits framework.
• Coordination with the Mott MacDonald team supporting updates to Heathrow’s ISO 55001 certified asset management system documentation, including identification of opportunities to apply modern methods of construction
• Support for Heathrow’s digital asset delivery roadmap improving the breadth, depth, and access to Heathrow’s common data environment.

With our support, Heathrow has successfully delivered its 2023 investment target of £380M supporting projects such as pavement renewals, airside vehicle replacement and cyber compliance without disrupting operations at the airport.

This has provided Heathrow’s senior management and stakeholders with the confidence needed to deliver the £480M 2024 investment target which Mott MacDonald will support.

Our work has helped Heathrow build confidence in its asset investments and focus on making proactive and deliberate decisions that support reduction of risk and improve residual asset life. This is supporting Heathrow to maintain physical and technological assets that keep colleagues and customers safe and secure. It is also helping to keep critical functions operational and ensure compliance of regulatory standards.