Gary Watkins, CEO of Service Works discusses the importance and benefits of having a comprehensive asset management strategy.
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A good asset management strategy can optimise operational performance, minimise whole life costs and support an organisation’s corporate goals as Gary Watkins, Managing Director of facilities and asset management software provider Service Works Global explains.
Actively managing assets is essential for the efficient and sustainable operation of any organisation. The key principle is to intervene with repair and maintenance activities at strategic points in order to maintain the performance of an asset and extend its life.
Proactive asset management provides a holistic view of what the organisation owns or leases, its condition, location and when it will next be maintained or replaced. This simplifies the budget planning process for facilities managers and enables effective Planned Maintenance as well as reducing backlog liabilities.
Service Works Global’s complimentary ‘Guide to Effective Asset Management for Buildings & Equipment’ examines the four phases of an assets life; from planning and acquisition through to maintenance and disposal and explains how to deliver a valuable asset management strategy.
Phase 1 – Planning & Acquisition
The operating costs of an asset typically outweigh the initial purchase price many times over; especially when taking into account staff costs, training, maintenance, operation, withdrawal from service, depreciation, disposal, renewal and rehabilitation.
At its most basic level, good asset planning can help an organisation decide whether it actually needs to purchase an item (and if so, whether to purchase, lease or hire it). At the time of purchasing an asset, it’s also essential that the facilities professional defines its service requirements; what it’s required to do, the minimum acceptable condition and how its service levels can be measured. The service levels should take into account the potential consequences of failure and minimum condition grade, both of which will feed into the asset’s criticality ranking.
Good asset management starts by developing an asset register, which contains all pertinent asset information. The register should feed into asset management software, which contains information about the asset’s maintenance schedule, as well as helping to plan for replacement and keeping a record for insurance and auditors.
Creating and retaining an up-to-date asset management plan allows facilities managers to analyse performance of models over a period of time. Life cost analysis involves the continuous monitoring of asset performance and maintenance during operation, identifying areas in which cost savings may be made. This helps support decisions such as whether it’s better to replace an asset with a more efficient solution prior to the end of its useful life, rather than to continue with a poor initial purchase decision.
Phase 2 – Operation
The operational phase of an asset’s life is its longest and most useful period – it is when the asset is managed and used to deliver services to support the core business and proactive asset management is essential at this point.
With an asset register already in place, an asset management procedure should be set up to ensure that new items are added when they are purchased/leased and that any changes to the condition of the asset are recorded. It’s also important to carry out a regular audit. The frequency of this will depend on the environment and the nature of the assets. If there are a lot of portable, high value assets (i.e. in a hospital) the audit should be carried out more frequently.
Other factors that should be considered during Phase 2 include; historic performance of assets, intervention strategies, risk assessment and business continuity planning.
Phase 3 – Maintenance
Proactive maintenance is at the very heart of asset management. A well-thought-through maintenance plan and the right type of maintenance (i.e. preventative or reactive/corrective) will extend the life of an asset. The data contained in the asset management software will help the facilities manager to ascertain whether, for example, investing 10 per cent more per annum in maintenance costs would double the life of an asset.
Understanding the criticality of each maintenance request, planned or reactive, is also a key facet in proactive asset management. Scoring these by priority (where 0 is low priority and 100 is high) will help the facilities manager appreciate the urgency of jobs and also develop an understanding of an asset’s characteristics to make informed decisions on the frequency of maintenance or audits.
Phase 4 – Disposal
However good asset management and maintenance planning is, there comes a time when an asset reaches the end of its useful life and should be disposed of.
On a practical level, all assets disposed of must be recorded on the asset register/software, to ensure they are not included as part of the organisation’s portfolio. An equipment disposal form will allow the asset ‘owner’ to explain how the asset was disposed of and identify any residual value.
Technology to track and manage assets
Before implementing a technology solution, it is essential to understand how software can benefit the maintenance operation. This will help with system selection and prioritisation of functionality.
Software can manage the entire asset management process; from asset discovery and condition monitoring through to asset tracking and condition management. It can establish true operating costs and support optimal life strategies as well as improving auditability and transparency of an organisation’s asset base.
A key advantage of implementing software is the visibility of data. For the data to be useful, the organisation must have a clear and consistent approach to verification, correction and management. As a result, it will be able to measure and track performance in greater detail, which will allow for adjustments to achieve desired results.
A good asset management strategy can deliver significant financial and performance/service improvements to an organisation. It can also make an FM’s life easier at an operational level.
Technology has a key role to play in each phase of an asset’s life, from tracking an asset’s location to managing the maintenance cycle. Handheld technology has revolutionised the work of the maintenance operative, saving time and improving efficiency and access to information. In any event, every asset needs to be managed and maintained to ensure it continues to function within its design parameters.
This article is based on the white paper ‘Effective Asset Management for Buildings & Equipment’ from Service Works Global. To obtain a complimentary copy, please email email@example.com.