These blogs are based on a series of interviews with John Woodhouse, TWPL’s Managing Director during the ‘Asset Management for the 21st Century – Getting Ready for ISO 55000’ Seminar, Calgary, May 2013. John is a founding member of the Institute of Asset Management and chaired the development of the PAS 55 standard and was appointed UK Principal Expert in the development team for the ISO 55000 standard.
In the first blog, “Why asset management should be this year’s obsession for CEOs,” The science of asset management is examined. Drawing from the key asset management practices that have been refined into the ISO 55000 standard, he delves into how asset management can help CEOs overcome a number of challenges, including departmental silos, short-termism, and the frustrations or ‘temporary enthusiasms’ that are often associated with poorly implemented and un-sustained improvement efforts. The conclusion is clear: CEOs should focus on asset management as it can transform an organization and generate tremendous ROI when done well.
In “Asset management requires both assets and management,” The crucial distinction between asset management and asset maintenance is explored. Most businesses think they’re performing asset management when in fact all they’re doing is asset care (looking after the assets). Asset management involves establishing processes for both assets are worth acquiring/creating in the first place, how best to use them, how to look after them (maintenance) and when to replace or dispose of them – all considered in terms of delivering best total value-for-money. It’s a sophisticated, coordinated effort in which the performance, risks and costs of an asset over its entire life cycle are taken into account, rather than just using an IT system to hold and accumulate asset data and to schedule work to be done.
In “To optimize asset management, define assets as systems, not components,” we go further into the point that businesses must tackle asset management from a systemic perspective rather than one only concerned with maintenance of individual components. CEOs are interested in how the entire system is performing, not just the functioning and costs associated with one part of that system (the equipment or ‘maintainable item’). Asset management must be able to look at performance and value realization at the systems level while recognizing that work and operational headaches mostly occur at the component level. A joined-up asset management system links these together to ensure that what gets done is that which delivers the best value – as defined by the organization’s needs and priorities.
In “Why are we surprised by catastrophes,” we probe one of the biggest failings of human beings: our incredible difficulty in dealing with, learning from, and preparing for, the low probability, big consequence events. Too often, when a catastrophic event occurs, businesses promise to learn from it and never let it happen again, only to let those promises fade as time and distance from the event grow – and a different major incident is encountered. Risk management is vital to proper asset management and dealing with threat of low frequency, high consequence events is an essential part of competent risk management. But these threats need special consideration – they are the game-changers and outliers that can override all other considerations. So we need to understand how asset management should take them into account.
“Why ‘lust to dust’ should replace ‘cradle to grave’ as the vision of an asset’s life cycle” targets the idea that asset management should begin with the conceiving and design of an asset, not once it’s operational. With a “lust to dust,” approach, businesses get better at choosing the right assets in the first place, considering operability, maintainability and sustainability (achievable lifespans). The DNA of the asset is already determined by the time it is in the cradle, and operations or maintenance can only make relatively minor adjustments in its behaviour and performance.
The sixth blog in the series, “How asset management can be a massive victory for IT,” shows how IT can and should play a crucial role in asset management, rather than impeding it as is too often the case. IT can support and link data processing, information management, control of workflow, and objectivity in identifying and solving problems, so that every facet of a business is operating in a more joined-up way and relying on the same set of information to make decisions. This type of integration is imperative to keeping asset management operating at the highest standards.
During his seminar, John Woodhouse tried to clear up the misconception that installing EAM software equates to introducing asset management. “Don’t confuse an EAM (or CMMS) for an asset management system” hones in on this idea. Asset management is much more than an EAM or CMMS solution; it’s a governance and coordination layer on top of the software and other ‘enablers’. It adds the organizational needs and business value perspectives to the mechanics of information collected and provided by EAM system. And it represents the coordinating framework to determine strategic direction and ensure that assets are managed to deliver these goals.
In “The four most common failures when implementing enterprise asset management software,” we get into the issue of intention. Successful asset management is predicated on a clear understanding of the intention of the system prior to implementation. It’s not enough to just install EAM software to make more efficient what was already being done before. Automating and streamlined inappropriate or ineffective activities does not yield benefits and often makes things worse. John Woodhouse points to four main mistakes that businesses make when putting in place EAM software and offers ways to avoid these derailments.
The ninth blog, “How thinking of assets as systems improves asset management processes,” is a more thorough exploration of a systemic approach to asset management. A systems perspective provides insight that myopic concentration on individual assets cannot. Asset management thrives when those in charge of different business practices and individual asset performance collaborate and focus on the larger ambitions of the company.
In the final blog of the series, “Avoiding the data swamp in asset management,” I hone in on how Big data is causing big confusion for a lot of businesses. The reason: most companies just don’t know what to do with the majority of the data they’re collecting. So it just sits there. Businesses need to step back and rethink whether all this data needs to be collected in the first place. It’s a waste of resources to gather and store data that serves no purpose. Demand-driven data is what companies should strive for and this blog highlights a step-by-step process on how to adopt this practice.
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