Final Thought: What Is Asset Management?

By Dr. Klaus M. Blache, Univ. of Tennessee, Reliability & Maintainability Center

Asset management means different things to different organizations—and applies to a wide range of activities. For example, plant managers want to maintain equipment, understand failures, and maximize throughput at lowest cost. Facility managers are more concerned about roof replacement, floors, piping, and utilities. Civil engineers are interested in infrastructure including buildings, roads, bridges, and water systems, among other things. Land, energy, and natural resources are also assets to be managed—and there are managers to do it.

All of these asset managers are interested in reliability and safety. They should all be expert at managing their particular assets from cradle to grave, i.e., concept and proposal, design and development, build, install, operate, maintain, and decommission.

In simplest terms, asset management refers to activities that ensure physical assets—over the course of their entire life cycle—help achieve the desired results of the business. Success, however, requires attention to factors beyond the assets themselves, including culture, continuous improvement, purchasing, operations, and leadership.

Reliability engineers find themselves involved with all of those additional aspects. They can instill a life-cycle asset-management process, starting with a foundational culture, including plans, goals, and metrics, then help institute standardized work processes such as work management, condition-based monitoring, and materials management. Such efforts are typically followed by initiatives that help optimize and sustain, with root-cause analysis, equipment design for maintainability and small-team continuous-improvement processes. The end goal is best practices and, at the very least, top-quartile performance.

Leadership in action

I recently returned from the 12th World Congress on Engineering Asset Management in Brisbane, Australia. Visitors can clearly see the results of successful asset management through the ease of transportation, cleanliness, planning of green space, functionality, and other aspects of the city—with more on the way.

According to Brisbane’s Lord Mayor, Graham Quirk, 21 kilometers of monorail are planned for 2022 to connect universities, medical facilities, technologies, and the airport. Asset management requires leadership that can think life cycle/long term.

ISO 55000

Based on my research, while some companies are exploring ISO 55000 certification, there doesn’t seem to be much movement toward it in North America. At a recent Reliability and Maintainability Center meeting, I asked member companies about their intentions. Seventy-three percent had no plans for certification. Nine percent were planning for it in three years. Another 18% were only thinking about it, but had no plans for it in the next three years. (Actually, 68% have not even reviewed or read the Standard.)

Although ISO 55000 covers many areas of asset management, it doesn’t guarantee best practices will be achieved. After all, an ISO certification is only as good as the processes that an operation agrees to implement. Also, much of what is addressed in ISO 55000, including reliability and maintainability, facility engineering, manufacturing engineering, and operational processes, is already part of many organizational plans. In those cases, it’s difficult to see value in establishing a duplicate process. That said, if a site doesn’t yet have an effective asset-management process in place, ISO 55000 is a good place to start. Just make sure to include the ISO 31000 Risk Management Standard, which is also needed.

When all is said and done, it’s important for an organization to conduct a critical review of its business processes to confirm that asset management is being addressed properly, and, in turn, supporting the tactical and strategic needs of the business. MT

Based in Knoxville, Klaus M. Blache is director of the Reliability & Maintainability Center at the Univ. of Tennessee, and a research professor in the College of Engineering. Contact him at kblache@utk.edu.