What is asset management?

Asset management is the management of (primary physical) assets in order to create value for the organization. It extends over the entire life cycle of assets; from selection up to and including disposal and all phases in between. Good asset management benefits the organization and its stakeholders. The existence of assets and all activities related to assets collectively enable the achievement of the organizational objectives. ISO 55000 calls this “alignment”.

Asset

An asset is something that has potential or actual value to an organization. What the value is, and what form the value is, depends on the organization and its stakeholders. Examples of physical assets are systems, machines, vehicles, infrastructure, civil structures, buildings, etc.

Asset management system

Organizations need an asset management system to perform good asset management. This system structures all elements (processes, activities and data) of asset management. The ISO 55000 standard defines what the elements and relations of a good asset management system should be.

The benefits of asset management

Good asset management can benefit your organization in many ways. Examples are:

• Demonstrated compliance with the requirements and wishes of your stakeholders;
• Better financial results because of better ROI and/or cost reduction;
• Informed decisions from multiple angles, such as performance, profit and costs, risks and opportunities;
• Risks managed when necessary and knowingly existent when acceptable;
• Higher customer satisfaction;
• Decisions also based on entire life cycle of assets (also when this exceeds the duration of other plans);
• Stability of the production in the long term;
• Improved reputation towards your stakeholders;
• Demonstrated compliance with regulation and legislation;
• Traceability of decisions;
• Improved knowledge management;
• Increased attractiveness for shareholders.

Specifically for compliance with the ISO 55000 standards, additional advantages could be:

• Generates interest on senior management level;
• Based on worldwide experience;
• Certifiable;
• Recognizable for stakeholders (such as policymakers, investors and customers);
• Accepted worldwide.

Asset management in your organization

The way in which asset management is carried out and what the asset management system looks like exactly can be different for every organization. This depends on, for one:

• the size of the organization;
• the amount and complexity of the assets;
• the risk appetite of the organization and its stakeholders.

Asset management is not an isolated activity. It overlaps areas such as operations / exploitation, control / finance, HR, risk management and QHSE. It is important that mutual processes and activities are well integrated.

As an organization has better control over asset management elements, the asset management is called more “mature”. Compliance with ISO 55000 is a basic level here. Please do note; a higher maturity level is not necessary for every organization. Different maturity levels could be desirable for different asset management aspects within one organization.