Assetera

IMPLEMENTATION OF ASSET MANAGEMENT.

Introduction

Asset management provides benefits to building owners and operators. These benefits are achieved in the areas of:

• Performance
• Efficiency improvements
• Achievement of obligations
• Responsiveness to change or growth

Achieving these benefits has proven to be challenging. Many organisations find the implementation of asset management to be expensive as it often requires a large commitment in terms of time, resources and technology. All too often the result is quite restricted and consequently disappointing.

The purpose of this paper is to quickly explore some issues around the implementation of an asset management framework in an organisation. There are 3 main topics to be considered;

• What information do we need to know about our assets?
• What activities need to be carried out to get an effective asset management structure in place?
• What is the nature of the implementation project been taking on?

What information do we need to know about our assets?

As with any management discipline the initial objective is to establish a viable plan under which the operations will be conducted. To optimise the planning capability towards achieving benefit from asset management, we believe that the facility / asset manager needs to draw information from a number of sources which we represent graphically as follows:

Function

In general, organisations use building assets to support service delivery objectives.

Asset management definitions emphasises the service delivery outcomes with reference to the stages within the typical asset life cycle. Service delivery is, or should be, the driver of an assets contribution.

Assets contribute to the service delivery objectives by providing capacity for functional units or groups to perform their work. So the function which an asset supports creates the link between service delivery objectives and the asset used.

When we talk about function we need to know:

• What demand will be for that particular services or functional component of service into the short, medium and longer terms;
• What functional groups (who) is using what space

Space

The building provides functional groups with spaces in which they can carryout their work. The spaces within the design contribute to capacity for functional groups to work. We need to understand the performance characteristics of the space itself such as:

• What is the short, medium, long-term utilisation / availability of each space
• What type of function and how much can each space support
• What dependencies exist between particular spaces

Elements

Each space is comprised of physical elements. Understanding the physical elements requires technical and quantative data on the fabrics, building services, finishes etc including:

• Technical standards
• Life expectancies
• Maintenance strategies
• Technical complexity
• Commissioning / decommissioning / refurbishment process

Context

It is important to understand the environment under which the asset management framework operates. We are not talking about the extremes of the physical environment but rather the bureaucratic, political, regulatory and commercial context under which the portfolio must operate.

What activities need to be carried out?

A generic work breakdown structure proposed for tactical implementation of asset management is described in the following 6 step process:

Step 1 ? Determine Requirements

Tasks

The first step is to about the fundamentals of planning and includes the following tasks:

• Establishing the objective of the exercise. Ask the question ?why are you doing this? and ?what do you have to achieve??
• Clearly establishing a link between asset use and the service delivery strategies of the organisation;
• Evaluating the project approach; could you develop a high level sample to determine the requirements for the entire portfolio or do you need a detailed asset model required; and
• Getting support and, most importantly, find champions. If the project has no champions which carry influence within the organisation the likelihood of corporate support, in terms of funding, is diminished
• Complete the business case to ensure that the argument is established

Items to consider

• Corporate Strategic Plan
• What strategies does the corporate strategic plan identify and exactly how do the facilities support those strategies
• Are there any capital projects or initiatives being considered by the Executive which need to be considered in any future asset planning

Output

• An approved business plan and a funding commitment from the organisation for the project.

Step 2 ? Source Data

The objective of data collection is to provide an understanding of the asset base and determining the scale of challenges required to achieve control and improvement of your assets. Assessment involves data capture; whether it is in the form of a simple asset register or a condition assessment of asset performance. It is our opinion that inadequacies in the area of assessment have greatly affected the implementation of asset management.

Tasks

Collection of asset data requires a considered approach which should include the following tasks;

• Before ever commencing the data collection establish (and agree upon) the asset register conventions:
  • Level of detail
  • Asset hierarchy
  • Identifiers for spaces, elements, functional groups
• Carry out the assessment of the facilities to collect the bulk of the information;
• Organise focused technical assessment of major elements such as plant, fa?ade, etc by specialists.
• Mark-up plans with functional groups

Items to consider

• Source copies of plans and any other relevant documentation from internal before
• A template for data collection for each space can be developed
• Use resource such as existing staff, students to carry out exercise, where possible
• Send collected data out to each functional group manager for review / confirmation or comment
• Populate your database with additional information from users responses, maintenance records, Facilities staff review the quality of the data and inspect where necessary

Output

• A database of verified data on the assets

Step 3 ? Set-up Database Model

Asset management is a ?data hungry? discipline. The growth of asset management is closely aligned to the development of information technology. The conversion of data into valuable information is an important function of the implement project therefore having the technology available to provide this capability is essential.

Tasks

This step should be carried out in parallel with Step 2 (at least) and involves the following:

• Document information outputs and subsequent data inputs;
• Develop brief specifying requirements for an information system;
• Consider procurement options;

Items to consider

Consider your procurement options based on your information needs and not on the promises of fast talking salesmen. Options could include:

• Revisiting the capability of the existing maintenance management software
• Developing a simple spreadsheet / database structure to hold the data;
• Sourcing proprietary software.
• An operational database model capable of storing data at the appropriate breakdown and carrying out information retrieval functions

Step 4 ? Allocate Costs

Adding cost information provides currency to all records in the database, which in turn establish relationships. This allows users to evaluate scale, and perform the analysis which is covered in Step 5.

Tasks

Cost information is added by:

• Extracting quantities from the data collection related to elements and condition;
• Applying rates and frequencies to the quantities derived from the data to work out long term costs; and
• Ensuring that a cost category, asset identifier and frequency / timing are allocated to each cost generated.

Items to consider

• Carry out costing calculations either within the database or on a separate spreadsheet;
• Liaise with Accounting Dept (or equivalent) to determining Cost Categories. Typically these would be similar to the following:
  • Capital
  • Acquisition Costs
  • Replacement Costs
  • Expensed
  • Routine Maintenance
  • Cleaning
  • Statutory Inspections
  • Energy

Output

• Value added to your data with records containing cost information

Step 5 ? Analyse Output

Step 4 provides the basic data for analysis. It is possible now using a database model structure to perform all forms of queries relative to the organisation.

Tasks

• Extract the information across the portfolio, eg
  • Costs by space
  • Costs by functional group
  • Costs pa
  • Costs by element / fabric
  • Area of carpet
  • Number of light fittings
  • Value of below condition works (backlog)
• Carry out benchmarking Benchmark ? apply ratios to highlight inconsistencies / anomalies, eg:
  • Area per staff per function
  • Average cost of maintenance
• Identify inconsistencies and anomalies within the data; and

Get the facilities staff to examine these issues in further detail if required.

Items to consider

• The database should be capable of allowing you to perform simple filters or queries to extract this type of information readily.

Output

• A list of all the inconsistencies, issues etc identified through the analysis.

Step 6 ? Strategise and Develop a Plan

Knowing the costs and identifying issues from the previous steps allows an organisation to work out the most appropriate strategy for their unique circumstance.

Tasks

• Confirm any parameters related to the context under which asset management will be expected to be delivered: eg. Budgets, politics, timing constraints, etc;
• Determine the priority for work applying risk management principles ? eg risk to safety, revenue;
• Match the cost profiles for the portfolio to budgets by carrying out various scenarios on the asset model;
• Decisions made to get cost profiles and budgets in balance forms the basis of the asset management strategy; and
• Define performance measurements which reflect the strategy.

Items to consider

• Discuss budgets, policies etc with senior management with regards to flexibility;
• Ensure that strategies are reflective of achieving the appropriate cost / performance / risk balance across the entire portfolio and not on individual assets only; and
• Ensure that recommendations of the heritage reports and policy or regulatory documents are reflected in the strategy documents;

Output

• An asset management strategy for the entire portfolio.

What is the nature of the implementation project?

The basic principle of project management is that all projects are unique. We should always take time to consider the characteristics of any project as it greatly influences our management approach.

Project Objective

In the broadest terms a high level objective for an asset management strategy would be one of the following:

• Improving business-performance levels by maintaining existing asset-related costs
• Improving business-performance levels by reducing asset-related costs
• Maintaining existing business-performance levels whilst reducing asset-related costs

Everyone participating in the project needs to recognise and agree to comply with a high level objective. Different groups within the organisation will have different requirements, for example engineers want details and accountants want financials. Objectives for different groups can be sub-objectives for the project at best.

Project Motivation

In our experience we find that for asset management implementation projects the primary sources of motivation are as follows:

• The organisation wants to do it;
• The organisation has been told to do it; and
• The organisation must do it.

Project motivation will impact on the support within the organisation and it also becomes a major driver in establishing the values of the following project elements, described in detail within the Project Management Body of Knowledge (PMBOK):

• Time
• Cost
• Scope
• Risk
• Quality
• Communications,
• HR,
• Procurement
• Integration

For example if an organisation ?must carry out? an asset management implementation project it is likely that time will be a priority and subsequently a higher cost might be anticipated compared to a scenario where an organisation ?wants to? carry out the project.

Choosing the Right Project Approach

The two extremes for asset management implementation projects can be described as:

• The staged approach
• The single project

Between both extremes is any number of options which may suit an organisation given its unique circumstance.

A staged approach involves taking on a series of small projects and defining the next project on completion of the previous. It is principally characterised by the following features:

• Use of high level models to determine the scale of the issue and set priorities; and
• Progressive compilation of asset knowledge.

The advantage of the stages approach is that:

• It can work out to be relatively inexpensive;
• It optimises use of in-house resources and data;
• Lower risk?greater certainty; and
• Can accommodate response to change.

The big disadvantage with the staged approach is that it can take time. Consequently there is a slow and gradual build-up of knowledge. If time taken to establish the strategies is long then there is an impact on short-term decision capability.

The single project approach involves adopting a fast-track project to complete data capture and strategy development. It involves developing a briefing document for the entire data-capture and getting external parties to carry out the entire delivery. While it can be complete within a relatively short timeframe, it can prove to be expensive as it will most likely rely upon external resources required. The quick timeframe can increase the risk particularly in the data capture component.

Conclusion

All features related to asset management within the organisation need to be recognised and understood (function, spaces, elements and operating environment);

Asset management should be considered a corporate function. The potential for benefit will be reduced if responsibility rests exclusively with one group/department within the organisation.

An Asset Management Implementation Project exercise does not have to be intimidating. The organisation should understand the motive, establish clear objectives and uses the data/information it currently holds to full advantage.