This graphic illustrates the Asset Management continuum with a focus on system-wide assets. Understanding the basic steps of a successful Asset Management program will help in developing a process and not a project. By describing the steps of a program it will assist decision makers in understanding the cohesive benefit for everyone to be successful and supported.
Inventory: An inventory, cataloging and mapping of the existing assets and their associated data, creates the program foundation. This includes both vertical and horizontal assets, the various information collection methods, and the accuracy standards that have to be met. Different sources of information, including paper records, spreadsheets and databases can be used to develop the list of assets. Importance is stressed on the uniformity of format for each of the assets cataloged with an eye towards its long term value to the higher end evaluation needs of the asset management program. In varying circumstances environmental, energy, financial and political information is collected with the asset logged.
Condition Assessment: An industry standard form of measure is established using asset management software to manage the following variables: age, location, risk, and current condition. The development of these standards is subjective to the organizations minimum quality level and ensures consistency throughout the program. Without these established standards asset condition becomes opinion-based and non-comparable.
Maintenance: Establishing a maintenance plan and tracking all planned and reactive efforts enables the program to validate the repairs approved, and the associated costs. Utilizing the manufacturers’ operation and maintenance manuals (where appropriate) to develop your program will ensure all asset characteristics are accounted and planned for. Work flows will be developed to define how users will capture pertinent information and keep it up to date. Standard operating procedures will be developed for preventive maintenance and energy responses to reduce the risk of failure as well as frustration. When work orders are issued, the associated tasks will be completed in the program for future planning efforts.
Lifecycle Costs: Improving asset utilization can extend asset life and performance while reducing capital costs and asset-related operating costs. Cradle to grave asset costs should be established which would include the acquisition cost, maintenance and operation costs as well as end of life costs. For many assets this would be difficult to establish, however, the more realistic the input the more reliable the output. Once this system is established, new assets would be input accurately improving the data’s usefulness over time.
Level of Service: Understanding the current level of service being delivered by the asset to its consumers, and identifying the gap between the current and proposed standards will identify the desired goals moving forward.
By formally defining a Level of Service, the goals of the program will be communicated, a link between cost and service identified, customer expectation met, and measurable results developed. Standardizing the assessment process will allow for all users to identify the remaining life of an asset and the factors impacting that useful life.
Criticality/Consequence of Failure: Identifying the impacts failure would have on the associated assets, consumers, and system is known as criticality. By developing an understanding of the consequence of failure, the organization is able to manage the associated risk. Risk is simply calculated on the probability and consequence of failure as defined by the equation:
Probability of Failure x Consequence of Failure = Risk
With an understanding of how we can reduce the system’s risk and focusing on assets where risk cannot be reduced, we are able to identify the priority of asset repairs or replacements. Failure has many factors including impacts to social, financial and environmental environments and therefore each need to be evaluated for each asset. By monitoring high risk assets impacts to those factors can be reduced, or eliminated in certain circumstances.
Optimizing Operations & Maintenance and Capital Improvement Plan: Understanding the assets condition, life cycle costs, criticality and the desired level of service allows for the analysis of an asset’s true useful life thus reducing premature replacement. By embracing asset management technology data will be gathered and analyzed in standardized and regular ways to ease the management process. By completing an analysis in a sound asset management system, a rational and defendable Capital Improvement Plan can be generated for various funding strategies and the results on Levels of Service can be clearly communicated.
Funding Strategy: Developing a long-term funding strategy based on the highest failure risk assets will assist in preventing sizeable cost increases to the system owner as well as its users. Using long-term budgeting for system assets will determine the priority based on the environmental impacts. This information will affect any grants or loans and therefore need to be discussed. By developing a long-term plan for the future the organization can assess the different impacts changes to their assets plays on their future Capital Improvement Plan.