The AM Group

This topic has a brief overview and covers:

From the initial Needs Analysis study, through to the final operational phase of the Asset Management systems, the organization needs to have a management decision-making group, which accepts responsibility/accountability for the program.

The task of implementing structured asset management is quite complex and is a considerable project management task. The cost of staff time and the provision of systems etc. are quite substantial and warrant a project management team to ensure its satisfactory completion.

The formation of an asset management group, committee or task force is a most suitable method to manage project implementation.

The asset management task force should be responsible to the senior management (or executive management) decision-making body, and should consist of the representatives of all the major departments or sections that will be involved in the final asset management plans or activities.

The work carried out by the body will fall into three distinct phases:

  • Strategy plans development (Needs Analysis)
  • The implementation phase (Data Collection and Input)
  • The operational phase (Evaluation of Outputs).

The Asset Management Group will have a different emphasis in each of the three phases. Roles of groups, and intensity of involvement will change, and thus the structure of the group needs to change to reflect the emphasis required.

Strategy Planning Phase

During the planning phase (Needs Analysis) the management group should include key players from the following sections of the organization:

  • Finance and Economics
  • Corporate Strategy Planning Group
  • Information Technology
  • The Asset Management Coordinator
  • The Technical Management Groups (possibly for each of the main asset groups).

The latter group should primarily involve operations and maintenance; however, secondary roles need to be played by design, survey and construction personnel to define the ancillary benefits required from the systems. The representative from this group also needs to represent the full vertical spectrum of technical management from the corporate level, through business units, down to the work face or facility groups.

The asset management coordinator's position is very important, and it should involve the person who will have long-term responsibility for asset management within the organization. Considerable thought should be given to making the appointment so that there is continuity throughout the 3 phases, which could take up to 5 years to complete. This person's prime role will be to co-ordinate the overall project while acting as coordinator of the Asset Management Group.

It is also important to consider personnel support for the coordinator to ensure that the organization is not solely dependent on one person for this activity.

In large organizations this support role will involve up to 3 or 4 people, and if the organization has been regionalized we would suggest that there should be an Assistant or Regional Asset Management Coordinator appointed for each of the major regions or business units within the organization. These appointees can then effectively act as the backups to the main coordinator.

Implementation Phase

At the end of the Needs Analysis Phase, strategies should be in place for the provision of the various computer systems required for Asset Management, together with the type of data to be input and a detailed program for the data collection.

Financial integration methods will have been determined and the various cash accounting and accrual economic outputs finalized.

In terms of workload, the data collection will dominate the entire implementation phase and will often constitute some 80-90% of the expenditure required to complete the entire program. The Asset Management Group needs to reflect this. Its membership should be varied to include all the various coordinators from each individual business unit or asset type group and it may require representatives from the various business or regional units.

During this phase we believe that information technology, finance/economic, and corporate strategy team members can play an ex-officio role in the Asset Management Group, and should be called upon to report on the progress in their areas. The major activity will involve the effective management of the data collection phase.

Operational Phase

During the Operational Phase the main task of the Asset Management Group involves the evaluation of the outputs from the systems.

There is also a large role in terms of monitoring the systems, and ensuring that the databases truly reflect the condition of the organization's assets and are continually enhanced to address the problems that are identified by the data analysis.

Determination of the most critical aspects will involve the application of risk management techniques. If this is done as part of the Asset Management program then we expect the Asset Management group will develop capability in determining the relative merits of the various programs being evaluated.

Horizontal Uniformity

For all asset owners it is important that they approach their asset management program in a consistent and uniform way across the broad spectrum of assets and the different service activities. If an organization is going to prioritize or allocate its resources in a logical way, based on clearly identified needs or risks, then all groups must have a uniform approach to providing information so that it is comparable. If this is done then sound decisions regarding resource allocation can be made because the costs and benefits to the organization for each of the different services can be clearly judged.

Apart from the concepts and principles being uniformly adopted across the organization, each similar asset group can also be dealt with in a uniform way. For example, different business units in a division may be responsible respectively for land and buildings, office equipment, vehicles and mobile plant, roads and paved areas, etc. From the organization's point of view it is important that the maintenance techniques and renewal decision processes are applied equally to similar assets across the various divisions.

For different asset types the following asset management activities will differ:

  • Maintenance management techniques and practices
  • Scheduling and priority of activities
  • Likely failure modes
  • Suitable treatment options
  • Optimal renewal strategies
  • New maintenance equipment and practices
  • Renewal techniques.

It is important that all of these activities are coordinated across the organization to ensure that the most innovative, progressive and cost effective techniques are being employed by the entire organization. The responsibility for coordinating this rests with the Asset Management Group.

Vertical Continuity

Vertical continuity relates to the way in which each of the business units performs its function with respect to achieving the division's target, while at the same time meeting corporate objectives. It determines the roles played by corporate management and down through the organization to the workforce.

The responsibility of the Asset Management Group is to ensure that the needs at each level in the organization are being adequately met by the asset management information systems and through the other aspects of advanced life cycle asset management.

Vertical continuity involves issues such as the:

  • Flow of information between corporate, the workforce, and return up and down the organizational structure
  • Relative roles and responsibilities for life cycle asset management functions being shared between the corporate asset "owner" and the delegated asset stewards, in the form of the corporate divisions, regions or business units
  • Co-ordination of the principles, guidelines and strategies being adopted by the organization as a whole, as opposed to those being adopted by the individual business units.

The management environment that needs to be developed in large asset owning organizations is one that:

  • Encourages innovation and creativeness
  • Identifies best practices
  • Disseminates these throughout the organization as quickly and as effectively as possible.

It is in this "continuous improvement environment" that the best practices for asset management will be derived and maintained for many years to come.

Uniform horizontal and vertical approaches are not intended to eliminate initiative or endeavor.

It is important for all organizations to monitor both vertical and horizontal performances, and use this to identify weaknesses and to develop strategies to overcome these. It is also an opportunity to identify strength and centers of excellence, and to ensure that these are spread more effectively throughout the organization.

Best Practice Principles of Asset Management

The application of best practice in the field of advanced asset management is not determined by whether the organization is public or privately owned, nor is it dependent on the type of management structure that is in place. It is dependent on the attitudes of the staff concerned, and the degree of sophistication of the information systems and their decision-making processes.

The organization needs to ensure autonomy to make good decisions, and to develop innovative and creative approaches, within clearly established lines of accountability.

Technical reviews of asset management are essential. This vital ingredient has often been missed in the past.

Roles and Responsibilities of the AM Team

Throughout the needs analysis and project evaluation phases, the organization needs to give the Asset Management Group a clear role and set of responsibilities for each phase.

There are three main options available for these roles:

Advisory Role (Steering Committee)

The Asset Management Group will work purely as an advisory body, and the study team derives information, determines the overall programs and obtains feedback and constructive opinion on the:

  • Approach to be taken
  • Observations that have been made
  • Details for proposed future programs
  • Conclusions reached and the issues identified.

Business Unit/Asset Group Endorsement

All the representatives on the Asset Management Group would have the endorsement of their various business units or asset groups, and would play the role of providing input from the various business units.

The various business units would be briefed and endorse recommendations from the Asset Management Group representatives prior to the report being put to the balance of the organization and the corporate management team.

Fully Responsible Team Approach

Under this option, the Asset Management Group would have full responsibility to plan and implement sound life cycle asset management practices and systems for the organization. The Group would play the major coordinating and organizing role for the needs analysis, implementation, and operational phases.

The asset management consultant would work as part of this Group and would play a coordinator, facilitator, and report writing role as directed by the team. The final system would be the product of the Asset Management Group.

The Asset Management Group would report regularly to the corporate management team, and seek its endorsement of the program and decisions made.

If a fully responsible team approach can be achieved, this option is likely to prove to be the most time efficient method to implement asset management within a large organization, and will ensure ownership throughout the organization.

Asset Management Executive Team (AMET)

In some organizations the asset management steering committee will become large.

As the profile of asset management increases, the numbers of stakeholders who believe that they need to be involved, either full time or part time tends to rise. Customer services staff, operational staff and representatives from all asset groups may wish to be involved.

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