Asset Management Plan/Program

Asset ManagementSimply put, asset management is managing an asset in an optimal manner from the decision to acquire, through the life of the asset, to final disposal. Operating
costs, risks, expected performance, and maintenance over the life of the asset are integral to management of the asset. Asset management has been around for 25-30 years in the United States.

Private sector companies and public sector organizations utilize asset management as a tool to maximize purchasing power, to preserve the value and life of assets (equipment, property, cultural artifacts, and utilities), and to improve their “bottom line”.

Why Bother With an Asset Management Plan or Program?

Because it provides:

  • a structured and systematic approach to acquiring an asset
  • how an asset will be utilized over its useful life
  • practical maintenance schedules
  • benchmarks for determining cost efficiency, and deciding when an asset should be sold/retired
  • direct input into operational and capital budgets
  • an accurate way of setting rates or price of services or products

Its role in the preparation of budgets is important.  It is a basis for:

  • estimating maintenance costs
  • budgeting new acquisitions/replacements
  • estimating revenue
  • viewing expenditures versus revenue by asset
  • planning over a multi-year time-frame

 Components of Asset Management

A good asset management plan is based on a detailed inventory of assets: property, equipment, investments, etc.  That inventory should contain pertinent information about each asset: its classification (real property, equipment, a utility, art, investment, etc.); acquisition date; acquisition Asset Managementprice; current location; current use; maintenance costs (monthly, quarterly, etc.); current value; current revenue generated, if any; remaining service life, if applicable; condition of the asset; criticality of the asset to operations; and, any other aspect important to your operation.

The adjacent diagram illustrates a typical life cycle of an asset and should be an integral part of any asset management plan.

 

The Public Sector

A.M. KAN is the model used by New Mexico and other states. It is a model developed by the Environmental Finance Center, a creation of the Federal Environmental Protection Agency.  It is not a software program; it is a process.  Its primary focus is water and wastewater utilities, so other areas such as property management are excluded.

The Private Sector

Below are brief descriptions of efforts in a few commercial sectors.

ISO 55000: 2014
The International Organization for Standardization recently published its ISO 55000:2014, the international standard for asset management. ISO 55000 describes asset management, the terminology used, and expected benefits, specifically improving the management of business assets.  ISO 55000 is applicable to all types of assets which makes it more flexible than the A.M. KAN system.

Railway Industry
The International Union of Railways (UIC) (includes North America members), in 2010, published its Guidelines for the Application of Asset Management in Railway Infrastructure Organisations.  This guide sets out 8 major steps for the design and implementation of a comprehensive asset management system for railways. They were drafted using the direct working experience of railway infrastructure managers.  The U.S. Federal Railway Administration has not adopted these guidelines at this writing, although the federal Highway Administration does have its own asset management overview document.

Airports
In 2012, the Airport Cooperative Research Program (sponsored by the Federal Aviation Administration) published its Asset and Infrastructure Management for Airports-Primer and Guidebook.  The Guide is aimed at various levels of airport management, including boards of directors.  IT covers topics like the benefits of asset management; developing policies, setting objectives and strategies; implementation techniques; and, reviews.

 

What DrakerCody Provides

DrakerCody, Inc. has the knowledge and experience to help your organization work through the details of a functional asset management plan. DrakerCody has worked with several organizations helping develop various aspects of an asset management plan. We can:

  • undertake detailed inventories of assets
  • determine critical assets
  • conduct risk assessments related to impact of asset failure
  • prepare the plan

We can keep the process simple!

Asset management does not have to be a daunting task. Let us help you uncomplicate the task! Call DrakerCody to discuss your needs and how we can help you!