IBM White Paper - Survey Results of Companies Asset Management Plans and Practices

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Research Report on
Asset Management Practices,

Investments and Challenges
2014-2019
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Note: Throughout this report, the term ISO55000 is used for consistency however the reader should be aware that ISO has published a series of
three documents designed to be utilized in concert. Only ISO5501: 2014 has requirements that can be met.
The series includes:
ISO55000: 2014 Asset Management- Overview, principles and terminology
ISO5501: 2014 Asset Management- Management systems - Requirements
ISO5502: 2014 Asset Management systems - Guidelines for the application of ISO5501
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Welcome
elcome to the Reliabilityweb.com Research Report on Asset Management

Practices, Investments and Challenges 2014-2019, a cooperative and
collaborative effort to capture insight that attempts to predict and even
guide the future of asset management practices, investments and challenges from
a snapshot taken at a very important moment in history. With approximately 1,000
participants from a wide variety of industries around the world, this is the largest and
most inclusive asset management study ever conducted.
In January 2014, the world achieved a remarkable breakthrough in the development
of a managing system framework for asset management with the release of the
ISO55000 series of standards available from the International Organization for
Standardization (ISO). The ISO55000 series of standards resulted from a three-year
effort that included contributions from hundreds of people from 28 countries.
Over much of the same period, Reliabilityweb.com was busy developing and refining
Uptime Elements, A Reliability Framework for Asset Performance Management
which supports value delivery from assets and can be mapped to ISO55000 Asset
Management compliant programs to enable asset reliability. This work is the result
of an enormous amount of effort and support from a lot of people. The asset
management study validates our assertion that reliability enables asset management
and that the two frameworks work together to generate business value.
Trying to predict the

future is like trying
to drive down a
country road at
night with no lights
while looking out the
back window.
~ Peter Drucker
As we explore the value of this work and its impact on the effectiveness of delivering
the triple bottom line of people, plant and profits, we get more enthusiastic about the
potential of asset management enabled through reliability. Our hope is that you will
share this enthusiasm and benefit from this research.
As you review the insights from this study, one thing that should stand out is that
organizational culture is cited as the top challenge faced by over 40 percent of the
asset managers who participated. We are hopeful these frameworks will overcome
those cultural challenges. The type of work that generated ISO55000 and Uptime
Elements is only possible through relationships, interactions and actions that people
take in their lives and work. Committed people who work relentlessly to bring new
ideas into existence are just the thing we need to change cultures and improve the
world.
Asset management will make the world a better place and reliability is a key element in
making asset management work. They are two sides of the same coin.
We are grateful and thankful for the support and insight provided by IBM, Bentley
Systems, CH2M Hill, MRG, Copperleaf Technologies and Nexus Global. We also
appreciate the information supplied by the studys participants and are happy to
return this aggregated work to the community from which it originated.
Reliabilityweb.com is committed to expanding its body of knowledge around asset
management and sharing it with you as you make your journey to value.
Warmest regards,
Terrence OHanlon
CEO/Publisher
Reliabilityweb.com
Uptime Magazine
Asset Management Report
s
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D h is S
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26%
What Industry Do You Represent?

11%
10%
9%
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er
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sp
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)
5%
Values
8%
7%
50
What Is Your Role Related to

Asset Management?
25
36%
31%
3%
O
Lead Asset
Management
Individual Contributor Other Support to Asset

to Asset
Management
Management
Not Involved in
Asset Management
6%
30%
How Many People Are In

Your Organization?
22%
Under 100
100-499
33%
9%
17%
500-999
1,000-9,999
15%
Over 100,000
10,000-99,999
4%
Where Are You Located?
20%
16%
14%
9%
7%
7%
8%
2%
Global/Multiple United States
Countries
Canada
Mexico
6%
4%
1%
South/
Central
America
Australia/
New
Zealand
United
Kingdom
Europe
China/
Asia
Russia
4%
2%
India Middle East
Africa
Asset Management and

Risk Management Standards
Many organizations do not have an awareness of ISO standards. Since consensus
standards are important for organizations to maintain a competitive position in their
respective marketplaces, it is vital for companies to understand which standards can
impact their business. Two standards that impact asset management business processes
are ISO55000 and ISO31000. These questions will provide some insight into participants
knowledge of these standards.
While its predecessor, PAS55, makes some references to risk, when it came to developing
ISO55000, it was recognized that risk management is integral to success. So, it is not surprising
that the standard was written to work in tandem with ISO31000, the existing and well-defined ISO
standard for risk management. The best practices for risk management defined in ISO31000 need
to be adopted and applied in the context of asset management or, more importantly, asset failure.
Assets need to be prioritized based on relative risk to the business, with risk defined as the probability
of asset failure multiplied by the consequence of failure, typically in terms of safety, environmental
impact, quality, customer service and company reputation, and appropriately balanced with economic
consequences to develop a truly optimal asset management plan.

31.19%
Please
Describe Your
Awareness of the
ISO55000
I am well versed
in the contents
10%
I Asset
am aware they
exist
but
not
familiar
of
the
contents
Management
Not
I am not aware of ISO55000
Aware
Standards
I am well versed in the contents
I am aware they exist but not familiar of the contents

58.74%
59% Aware they Exist but not

Familiar with the Content
58.74%
10.07
10.07
ISO55000
31% Well Versed

31.19%
- Bentley Systems
ISO31000
Use the new standard as a way to inform and engage top management.
54% Aware they Exist but

not Familiar with the Content
13.83%
14%
Well
Versed
53.70%
13.83%
53.70%
Please
Describe Your
Awareness of the
ISO31000
I am aware it exists but not familiar of the contents
I am Risk
not awareManagement
of ISO31000
Standard
I am aware it exists but not familiar of the contents

32.47
32% Not Aware

32.47
There are several results from this survey that warrant additional comments. The first pertains to
the awareness of the ISO55000 asset management standards. Ninety percent of the 933 respondents
are at least aware of the standard and over 30 percent are very familiar with the contents. As a
member of the U.S. delegation that contributed to the standards development, this is pleasing to
see. However, the results from the next survey question are a bit distressing because they show more
than 30 percent of respondents are unaware of the ISO31000 standard on risk management and
only 14 percent are familiar with its contents. We believe asset management and risk management
are very closely related and one cannot be effectively implemented without the other, as proven by
some recent asset-related disasters, such as the Deepwater Horizon oil spill and the Fukushima Daiichi
nuclear power plant failure.
Effective risk management was a central theme during ISO55000s development, but since a risk
management standard had already been developed, the development team thought that referencing
ISO31000 would be sufficient. There has been significant publicity within the maintenance reliability
community regarding ISO55000, but this may have been due to the common misperception that
asset management is a repackaged version of maintenance management, which is not true. Evidently,
there has not been equivalent publicity for ISO31000. We encourage organizations to gain a better
understanding of risk management and a good place to start is reviewing the contents of ISO31000.

- MRG
Your Managing
System Framework
The two ISO standards that have impacted many business processes are ISO9001 (quality)
and ISO14001 (environmental). Both are management system standards that require a
management framework to be in place to ensure continued compliance. ISO55000 uses the
same type of management framework. If an organization has certified to either ISO90001
or ISO14001, then it is likely to be able to leverage that managing systems framework to
the ISO55000 standard.
Which
standards are your organization certified to?
100
100
75
75
50
50
51%
51%
38%
38%
42%
42%
25
25
9.00%
9.00%
O
O
ISO9001
ISO14001
No ISO certification
ISO9001
ISO14001
No ISO certification
Other ISO
certification
Other ISO
certification
The survey results show a pretty black and white world. Half of the
companies have ISO certification, in which case, they nearly always
go for both ISO9001 and ISO14001 certificates. The other half has no
certification. The consensus within the ISO community seems to be
that ISO55001 will rapidly become as popular as the current ISO best
sellers, which means it is reasonable to expect that most companies
that went for ISO9001 and 14001 certification will also seek 55001
certification. How quickly can we expect organizations to adopt
ISO55001? Other questions in the survey indicate certification will
take its time and, indeed, ISO expects a mere 4,000 companies will be
certified after three years. But then, the hockey stick effect might kick
in, just as it did for ISO9001, which was launched in 1987, had 400,000
certified companies in 2000 and 1.2 million in 2012.
If youre certified
to these standards,
you already have a
managing system
and framework.
Its not as hard as
you think youve
already got
a head start!
- Copperleaf Technologies
A bit of a surprise is that only 50 percent of the organizations had been certified to
another management system standard (e.g., ISO9001 or ISO14001). Given the number of
larger companies involved in the survey, it is somewhat surprising that more had not been
certified. However, those that have been certified to one of the other standards will have
a head start on implementing ISO55000s requirements since the same management
system framework likely can be used. ISO is currently engaged in an effort to align all of its
management system standards. In fact, during the development of ISO55001, a template
of management system requirements was provided to the development team. The team
could amplify and add requirements, but was forbidden from altering or deleting any of the
requirements from the template. Therefore, any ISO management system standard will have
a similar framework and several of the practices that have been put in place for one can be
leveraged to another.
- MRG
vs.
Long-Term Goals Short-Term Goals

This was an important consideration in the survey for several reasons. First, if the short-term
plans begin to produce rapid results, they will fuel the companys desire to make further
improvements in its asset management strategies and systems. Secondly, by dividing its
future investments into short-term and long-term goals, it helps the organization focus on
maximizing the return on investment for asset management as a continuous process.
2015-2019 2014-2015
Asset Information (Data) Management Systems
35%
39%
34%
Asset Management Consulting Services
29%
Business Intelligence, Analytics and Reporting
29%
Asset Performance Measures and Metrics
40%
Asset Reliability Improvements
43%
43%
Risk Management and Risk Assessment
38%
37%
Asset Condition Assessment Tools
37%
37%
Asset Lifecycle Costing/Lifecycle Modeling
36%
31%
ISO55000 Compliance or Certification
33%
20%
Asset Investment Planning
26%
23%
Computerized Maintenance Management Systems

(CMMS)/ Enterprise Asset Management (EAM)
27%
31%
Reliability Centered Maintenance
35%
34%
Wireless or Remote Sensing Technologies

Change Management
10
22%
25%
Data Quality Improvements
28%
Asset Management Training
41%
22%
43%
17%
26%
26%
43%
If an enterprise
puts in place a solid
foundation to collect
and manage asset
information, the
benefits could be
enjoyed by all.
When reviewing the top five responses to

this question, it immediately drew attention to
a common thread that can be traced back to
the economic turn back in 2007/2008. When
industry was caught off guard by the financial
collapse, many, if not all, organizations pulled
the reins back on spending. This included
capital spending on equipment and we saw
a marked increase in deferred maintenance
activities. By doing so, the maintenance
strategy fundamentally shifted to that of keep
it running. The top three survey responses
for asset management investments are asset
reliability improvements, asset management
training, and performance measures and
metrics. This makes sense based on what we
now know. Get the equipment back up to
some level of asset health, train the people on
how to maintain that level of health and put
measures in place to track the health of the
asset so early detection can take place and
corrected at an optimal cost.
-
Nexus Global
Rapid Adoption for ISO55000 Certification1

While adoption of an asset management based business strategy does
not require certification, 33% of the study participants indicated they
would pursue adoption over the next five years.
The trend indicates that there will be a significant and steady increase
in organization planning to either comply with the new ISO55000 series
of standards or seek formal certification as a competitive advantage.
- Terrence OHanlon

1. ISO/IEC TS 17021-5:2014 Conformity assessment -- Requirements for bodies providing audit
and certification of management systems -- Part 5: Competence requirements for auditing
and certification of asset management systems.
11
Gap Assessment and

Benchmarking
In a process as complex as asset management, it is possible for companies to overlook
certain aspects. When a company conducts a gap assessment or a benchmarking project, it
is gaining information to make its asset management strategy more effective and efficient.
If an organization pursues this type of improvement initiative, it will have a heightened
probability of success with an asset management program.
Only 55 participants (7%) indicated that they have already completed a gap assessment. One
hundred and seventy three respondents (22%) are planning to implement it over the next 12 months
and 222 (28%) are planning to implement it over the next one to five years. Many of the respondents
(340 or 43%) indicated that they are not planning to implement the gap assessment. The majority
of the participants (67%) conducted or are planning to conduct ISO55000 within five years. This
indicates that more enterprises are interested in addressing the asset management gap assessment
to improve on their processes and increase the reliability of their assets, which results in lower
downtime and higher profits.
-
100
CH2M Hill
Are You Planning to Conduct an ISO55000 Asset

Management Gap Assessment?
75
50
43%
28%
25
22%
7%
O
Already Completed
12
Over the next 12 months
Over the next 1-5 years
Not Planning
Benchmarking is extremely important because it allows us to compare ourselves to others in

our industry, or in general terms of overall operation. We all do some level of benchmarking that
most people dont recognize. Metrics, measures, key performance indicators (KPIs) are all forms
of benchmarking. Internally, they measure how individuals, departments, or the organization are
performing against some high-water mark.
Benchmarking can be likened to sports. Would we really watch sports if we didnt keep score?
Would we really care to see people running up and down a court, field, baseball diamond, swim
lanes, etc.? Every sports league has teams that make up divisions North/South, American/
National and Atlantic/Central and within these divisions we have standings. Whos in first place
and whos in last? We even reward the best performing teams with whats called playoffs. And
after playoffs, we crown a champion.
Think of benchmarking and the goal to be world class. What does world class mean? Is it
being the best? Being great at everything? Nope! Being world class means being in the top
quartile of your division. Benchmarking allows us to compare ourselves to the competition and
constantly strive for continuous improvement. Organizations cannot allow themselves to become
complacent. Once they do, they lose market share. If you dont believe this, look no further than
Blockbuster and Redbox!
- Nexus Global
100
Please Indicate Your Plans Regarding

Asset Management Benchmarking
75
50
31%
25
16%
33%
21%
Have Already Completed Asset

Management Benchmarking
Asset Management
Benchmarking is in Process
Plan to Conduct
within 12 Months
No Plans to Conduct Asset

Management Benchmarking
13
Asset Information Management

and Plans to Improve It
Many organizations equate an asset information management system with their
computerized maintenance management system. These two questions should help broaden
their perspectives. Their responses to the survey will allow them to revisit their current
understanding of asset information management systems and expand their current systems
to address all aspects of an asset management program.
A major surprise is that less than 20

percent of the respondents felt their asset
information management system fully
supports effective asset management.
If an organization expects to have an
effective asset management system, then
having trustworthy information about
their assets is an absolute prerequisite.
This condition is easily correctable; it just
needs to command the right priority to
get it done. Failure to do so will impact an
organizations ability to make good, databased decisions concerning their assets.
In fact, having faulty data in the system
may actually be worse than having no data
at all since incorrect conclusions may be
drawn from bad data in a mistaken belief
that it is accurate, but in the total absence
of data, intuition or a gut feeling may lead
to a better decision. High quality asset
information is critical to an effective asset
management system.
11%
63%
11%
Describe Your
Asset Information
Management System
7%
19%
63%
7%
Does not support a
It supports some as
It fully supports effe
MRG
19%
I am not sure what asset information management is

Does not support any of our asset management strategies and plans
It supports some aspects of asset management but has gaps for other aspects
It fully supports effective asset management
14
I am not sure what a
I am not su
Does not s
It supports
It fully supp
It is no surprise that the responses are fairly evenly distributed among several key areas. It
is essential for people at all levels to have accessible, high quality information to make good
decisions that lead to better safety, efficiency and compliance. Bad decisions, which are the root
cause of many asset failure incidents, are typically made by well-intentioned people, but based
on poor information. Conversely, good decisions can make the difference when mitigating the
consequence of failure. Theres no question that well-informed decisions actually prevent incidents.
Information management systems support human excellence in decision making. A central system
should consolidate asset data and help make timely and accurate maintenance decisions.
Managing assets requires a whole life value approach. As-built/as-maintained engineering
information is needed to make informed decisions, as is an understanding of how that information
relates to the original design and current regulatory obligations. When assets are modified or
upgraded, engineering information must be kept up to date. Ideally, this includes:

Information federation Referencing and maintaining the relationships between relevant data that
may reside in different systems.
Configuration management Managing the change process and ensuring the physical plant is
aligned with the information asset at all times.
Information mobility Ensuring the right information in the appropriate format and level of
precision can be accessed by the right people at the right time.
Immersive interfaces with 3D models Enabling information exchange and sharing of data. Using
i-models (i.e., conveyors of architectural, engineering, construction and operations deliverables),
not only 3D, but also 2D and 1D (i.e., data) information, is available within the asset management
system.
This approach aligns with ISO55000, as well as related National BIM Standards and PAS1192-3,
which is the Publicly Available Specification for information management in the operational phase
of assets using information modeling. The approach reduces the gap between an engineers or
managers mental model of a plant, its performance and its representation in IT systems. This immersive
environment facilitates a common platform for the various disciplines involved in asset management
to collaborate effectively in streamlining processes, better supporting existing enterprise systems,
providing consistency, and ultimately, improving performance and reducing risk.
To ensure sustainability of assets, the management of assets then needs to span the whole life value.
So integrating information management with asset management definitely should be a requirement to
ensure better understanding of assets and their health, as well as to enable better decision making.

- Bentley Systems
Top Three Plans to Improve

Implement asset condition information management
33%
Implement data analytics
32%
Integrate Capex and Opex project and

information management systems
31%
0
200
400
600
800
15
Single Biggest Obstacle for

Improving Asset Performance
This question highlights five of the most common obstacles that organizations have
encountered when improving their asset performance. Considering this question will help those
organizations that are beginning to improve their asset management program since they can
anticipate challenges that will occur and make plans to overcome them. It also will help them
understand that they are not encountering unique problems and allow them to learn how other
organizations overcame these obstacles to improve asset management.
Its interesting, but, again, not surprising that most people think organizational culture is the biggest single
obstacle to improving asset performance. We know from experience that most people think organizational
culture is impossible to change, but in our experience, changing from reactive to proactive is not impossible. It
may be difficult and multifaceted, but not impossible, provided organizations have the proper tools, training,
KPIs and, most importantly, the leadership that will support and manage a new proactive process. This requires
addressing risk in the business planning process and incorporating data-driven process management that not
only measures results, but also emphasizes process measures (e.g., leading indicators).
Expectations for a proactive approach to maintenance reliability need to be established and individuals
must be held accountable for this approach. In addition, efforts to improve reliability should be recognized and
results from the proactive approach rewarded. To help facilitate the change to proactive, organizations need to
enforce discipline to process, and change KPIs and the recognition system to reward proactive tasks rather than
firefighting tasks. So, good job for fixing the equipment so fast needs to be replaced with that small outage for
proactive corrective action prevented us from downtime that would have cost us $2 million in lost production.
By changing the day-to-day behavior to proactive, organizations are essentially changing to a reliability culture.
Over time, proactive behavior, if reinforced and driven systematically, becomes a way of life.
100
- Bentley Systems
What Is the Biggest Obstacle for

Improving Asset Performance ?
75
40%
50
25%
16%
25
16
Cost/
Funding
Priorities
12%
Executive
Support
8%
Capabilities
Organizational
Culture
The Benefits You Expect from

Asset Management Improvements
This question identifies the potential benefits that can be realized when making asset
management improvements. It serves a dual purpose. Firstly, it allows respondents to ensure
their expectations are realistic. Secondly, it ensures they have not overlooked any possible
benefits when preparing their business case for asset management improvement.
Top Five Benefits You Expect From Asset Management

Lifecycle Cost Reduction
68%
Identifying and Managing Risk
66%
Extracting Data to Support Evidence-Based

Asset Management Decisions
58%
Determining the Optimum Maintenance

Approaches for Assets
57%
Changing Company Culture
52%
Largest Expected Benefits

Industry is in the business to make money. Industrial
organizations convert materials into a finished good and sell
According to ISO55000, the benefits of asset
it on the open market. The difference between cost of goods
Top
FIVE
Benefits
You Expect
management
include: From Asset Management
sold (COGS) and selling price is called margin or profit. The
a) Improvements
Improved financial performance;
better organizations are at reducing COGS, the larger the
margins. A percentage of those COGS are maintenance
b) Managed risk;
expenses. The number one response in the survey is reducing
c)
Improved services and outputs;
lifecycle costing and the second is managing risk. Studies
d) Corporate/social responsibility;
indicate that lifecycle costs are reduced by maintaining the
e)
Demonstrated compliance;
assets at a level of health over their useful life. Consider an
f)
Enhanced reputation;
automobile. By rotating the tires, we avoid having to replace
g) Improved organizational sustainability.
them at a higher frequency. By checking and changing the
oil on regular basis, we avoid the potential for major engine
work because the risk of not checking could be costly. By
managing the potential risks, we avoid the unexpected
expense of catastrophic failures. Further, historical data shows
that unscheduled maintenance can be four to six times
greater than scheduled activities.

- Nexus Global
Asset management creates the opportunity to link

outcomes and asset management objectives with
specific organizational objectives. The survey showed that
improved financial performance, in terms of performance
and cost, and management of risk were the largest
expected benefits from asset management.
- Terrence OHanlon
17
Outsourcing
This is an important issue since many organizations feel if they outsource their asset
management program, they are no longer responsible for it. The answers to this
question will assist them in understanding that they will still retain ownership of the
assets. The responses also will help them realize the amount of outsourcing that is
occurring in the asset management field.
Among the survey participants, 70 percent stated they plan to implement their asset management
program in-house and would not outsource any part of the program. This shows that the asset
management practice is growing, not just in awareness, but also competence and execution. A
moderate amount of respondents (30%) indicate they expect to invest in consulting services in the
next one to five years that may be focused on supporting specialized areas, such as ISO55000, new
technologies, reliability centered maintenance (RCM) and change management (e.g., training and
benchmarking), as indicated in the aforementioned asset management investments responses.
Taking a more thorough look at the demographics, a couple of factors may affect the high
percentage of in-house execution. Thirty-one percent of those surveyed stated they are currently
well versed in ISO55000 and a majority of those surveyed already have ISO9001 and/or ISO14001
certifications. The awareness and certifications of these ISO standards would put these participants in
a better position to implement their asset management program by themselves.
- CH2M Hill
Does Your Organization Have Plans

to Outsource Any Part of Your Asset
Management Program?
29%
71%
Yes
No
29%
71%
18
Yes
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19
Plans for Asset Management

Policy and Strategic Asset
Management Plan
These are important questions since developing the asset management policy and the
strategic asset management plan (SAMP) are two of the early components of any asset
management program. While the organizational objectives drive the development of both the
asset management policy and the SAMP, the asset management policy determines how the
organizational objectives are converted into the activities that comprise an effective strategic
asset management plan, thereby realizing the maximum value from the organizations assets.
Are You Planning to Create an

Asset Management
Policy?
Already have
40%
40%
asset management policy
38%
38%
Planhave
to implement
Already
within 12have
months asset management policy
Already
asset managementan
policy
plans to implement
PlanNo
to implement
Plan
to
implement
within 12 months
within 12 months
NoNo
plans
to implement
plans
to implement
22%
22%
Already have an asset management plan

Plan to implement within 12 months
No to
plans
to implementa Strategic
Are You Planning
Develop
Asset Management Plan?
Already have an asset management plan
23%
Plan to implement within 12 months

No plans to implement
44%
33%
23%
44%
20
33%
In our experience, here is what needs to be done in the strategic planning stage:
1. Set a High-Level Asset Management Policy In moving to a performance-focused organization,
develop an asset management policy in consultation with site leadership. The policy needs to
state the organizations fundamental principles about the management of its assets from design
to disposal, including its vision, beliefs, values and commitments to asset management at a high
level. Its important that the asset management policy be a short, concise document that is signed
by senior executives. This becomes the mandate and must be widely distributed within the
organization.
2. Set an Asset Management Strategy and Objectives Based on business goals and adherence
to the asset management policy, establish the asset management strategy and objectives to be
reviewed in line with the organizations business planning cycle.
3. Business Case Identify and articulate how asset management can help the organization reach
its business goals. The business case quantifies the financial gains, business benefits and return on
investment to be achieved by proactively managing assets. This justification step is essential for
achieving buy-in and approval from management.
4. Assessment Evaluate maintenance reliability practices against recognized world-class standards.
Formally document the qualitative and quantitative evidence that identifies both strengths and
opportunities to improve.
5. Program Definition Include scope, objectives, resource requirements, project accountabilities,
timeline and critical success metrics for the organizations asset management improvement plan.
6. Communications Plan Develop a comprehensive communication plan aimed at engaging the
entire organization in the change effort on a regular basis. Also, identify how changes to scope or
resourcing will be managed.
7. Change Leadership Training Asset management requires involvement and active sponsorship
from all levels of the organization. Plan to educate senior leadership on change management,
preparing them for the challenges they will face in leading and sustaining a proactive approach to
asset management. In addition, plan to educate leadership on reliability centered maintenance so
they can become well versed in the language of RCM and better equipped to ensure that physical
assets make a positive contribution to the overall business strategy.
8. Accountability Model Working from the business case findings, as well as the high-level
business plan, senior leaders need to identify how they will measure the impact of the
improvement efforts on the organization. Specific results-based and process-based KPIs should
be identified, baseline measures established, targets for improvements established and agreed
upon, and owners identified.
9. Sustainability Assessments Plan for follow-up evaluations to measure adherence to the process
and the impact the organizations improvement efforts have made on its maintenance reliability
practices in the area(s) of implementation.
Never underestimate the power of a strategic asset management plan.

- Bentley Systems
21
Factors When Considering Asset

Management Improvements
This question focuses on what is typically called the triple bottom line, which is the financial,
environmental and social factors that a company must consider in any asset management
program. This ensures the company balances its responsibility of providing a return on
investment to its stakeholders while fulfilling its social responsibilities and protecting the
environment in its community.
It comes as no surprise that all of us aim to improve our chances of achieving our companys economic goals.
But environmental and social responsibility goals also score very high, underlining one of the central concepts
of ISO55001, namely the fact that companies have a variety of goals that all contribute value. Conversely, an
asset management system must be capable of defining and measuring value by considering and weighing all
contributing factors. It must understand our corporate strategy and the specific elements we are seeking to
maximize or minimize, and evaluate every proposed action in line with these criteria.
Just as important is the ability to prove that actions undertaken (e.g., asset repairs, maintenance, replacements)
actually achieved the value that was promised up front. Good asset investment planning systems will allow
companies to review the outcomes of their actions and, thereby, learn for future planning cycles.
100
Factors Use in Your Organization When

Considering Asset Management Improvements
75
90%
90%
50
63%
63%
54%
54%
25
22
Achieving
Environmental Goals
Achieving Social
Responsibility Goals
Achieving Economic Goals
Why Do You Have an Interest in

Asset Management?
This was a valuable question for the survey since the reasons why companies pursue an asset
management program vary. The responses are divided between financial reasons, lifecycle
management and reliability. This is reasonable since all three are major issues that must be
addressed in all asset management programs. Additionally, there are hidden issues, such as
aging workforces, that also must be considered.
There were nine answer choices to this question that highlight the reasons to implement asset management. Out of
976 respondents, 715 answered this question and the rest (261 or 27%) skipped it. The participants could choose one or
more answer choices. There were 3,327 selections, or an average of 4.7 per person and a range of 46 to 77 percent.
The choice to increase system reliability received the highest number of responses (552 or 77%). This indicates that
participants recognize the need to have reliable assets in place to positively impact financial and infrastructure conditions.
The second highest choice was to improve financial results, with 469 (66%). Aging assets/infrastructure received 439
responses (61%). The choice to increase asset service levels at a lower cost received 429 responses (60%). The choice to
understand consequences of asset failures received 385 responses (54%), while the choice to improve budget forecast
received 354 responses (50%).
The results indicate that more than half of the participants do not think their human capacity and/or regulatory need is
as high as asset condition and financial considerations. Overall, there were generally strong numbers across the response
set, which could be grouped into triple bottom line categories, including financial (65% to improve financial results),
environmental (44% to meet regulatory requirements) and social (46% to transfer knowledge of an aging workforce).
- CH2M Hill
100
Why Do You Have Interest in Asset Management?

Aging Assets/
Infrastructure
75
77%
Increase Asset
Service Levels at
Lower Cost
Understand
Consequences
of Asset Failures
Meet Regulatory
Requirements
66%
61%
60%
54%
50
46%
50%
44%
Other
25
7%
O
Increase System
Reliability
Transfer
Knowledge
of Aging
Workforce
Improve Budget
Forecast
Improve Financial
Results
23
Planning Timeline for Asset

Management
This is an important question since delivering value from assets is a long-term objective for
any company. Since many assets have lifecycles of 40-plus years, asset management requires
a longer term planning horizon, so respondents should reflect this knowledge in their answers.
If they do not, then it is unlikely for them to have a long-term vision for an asset management
program in their organization.
Most companies operate on a relatively short planning horizon, typically four years or less. Yet, most assets have far longer
lives, often 50 years or more. Therefore, one would expect asset-intensive organizations to develop much longer term asset
investment plans. However, a combination of lack of reliable data and the absence of good modeling tools often restricts the
ability of organizations to produce reliable, long-term plans.
Interestingly, the survey data show a bump, where over 12 percent of the companies do produce plans of 15 years or more.
In our experience, this is often the case in regulated industries where independent, outside regulators require 20-plus year plans
to ensure the company is managing its assets in the best interest of all stakeholders. These companies prove that it is perfectly
possible and often beneficial to produce long-term plans. Specialized tools modeling future capital and resource needs based
on asset data, risk models and different economic scenarios are a crucial part of asset investment planning solutions, typically
used to build and maintain such long-term plans.
100
What is the Furthest Detailed Planning Horizon

for Your Organizations Asset Management?
75
50
40%
40%
33%
33%
25
12%
12%
6%
6%
24
1-4 years
5-10 years
11-15years
More than
15 years
9%
9%
No Plan
Use of Asset Management

Program Performance Metrics
This question will likely produce some interesting results. Based on the respondents answers
to previous questions, such as the triple bottom line, their short-term and long-term goals,
and their asset management benefits, they will be challenged to choose the correct asset
management program performance metrics. While they may have the right objectives, if they
do not select the proper performance metrics, they will never have their efforts aligned with
their asset management program. This misalignment will likely lead to an early failure of their
asset management program.
Indicate Your Use of Asset Management Program

Performance Metrics
57%
Asset Failure Metrics
60%
Maintenance Cost Metrics
25%
Asset Service-Level Metrics
36%
Unit Cost Metrics
53%
Availability Rates
46%
Reliability Rates
6%
None of the Above

Do Not Track Asset Performance
10%
Other
4%
0
20
40
60
80
100
25
Asset Management Practices,

Investments and Challenges
by Terry Wireman
study was conducted in spring 2014 to determine the status of

asset management initiatives worldwide. Almost 1,000 companies
responded to the study, with 50 percent of the respondents from
the United States, the United Kingdom and multi-national companies. The
size of the companies is split evenly, with one half of the companies having
more than 1,000 employees and one half with less than 1,000 employees.
Interestingly, there is also an even distribution of responding companies
across industry verticals.
There are three questions that most executives would find interesting. The
first is: Why are you interested in asset management? The top three responses are all related to the financial impact that asset management could
have on their organizations. The first response was to increase system reliability (77%). This response focuses on the need for capital expenditures
(CAPEX) for new assets to compensate for poorly performing assets and
operational expenditures (OPEX), such as asset maintenance, to compensate
for assets that continue to perform poorly. If an organization utilizes proper
asset management policies, the asset reliability would have a positive impact
on both CAPEX and OPEX expenditures.
The next two responses were to improve financials (66%) and increase
service levels at a lower cost (61%). Financials related to assets are typically
measured by some type of return on asset (ROA) indicator. If a company is
to improve its financials, it has to derive the optimum value from its assets. To
achieve this goal, the company must be able to derive the maximum output
from its assets, often referred to as design capacity. Additionally, the company would need to carefully manage the maintenance resources utilized
to ensure the maximum output from the assets. This would include optimization of maintenance resources through effective planning/scheduling and
good materials management policies and processes.
The second question is: What benefits do you expect from asset management? The first answer was lifecycle cost reduction. This links to the
responses from the aforementioned first question. If an investment is made
to develop a formal asset management process, executives expect to see a
reduction in the overall lifecycle costs for the asset. Achieving this requires
lifecycle tracking of the companys assets (e.g., design, installation, operation/maintain and decommission/disposal). Then, decisions can be reached
that will optimize the investment made in each phase of the lifecycle of the
asset.
The next two responses were data to support decisions (58%) and determining optimum maintenance approaches for the assets (57%). These re-
26
sponses show that most executives do not fully trust that the current asset management information
is accurate enough to make policy and process decisions. This leads to second-guessing many CAPEX and OPEX decisions that are made based on current asset conditions.
The third question reveals the biggest obstacle faced by companies implementing asset management. The first response was organizational culture (40%). This indicates that many companies have
the technical abilities to develop and implement an asset management program, but lack the organizational understanding to do so. This also indicates a need for extensive training to help employees
develop a clear understanding of the value proposition for asset management. Additionally, it indicates a need to break down organizational silos so a clear line of sight can be developed. This allows
the organization to focus on deriving the maximum value from its assets.
This leads to the second ranked answer, funding/cost (25%). This shows that most executives realize that asset management will not be successful by just throwing money at it. They must have a clear
line of sight from the departments/employees to the assets and to the bottom line. It is only through
this clear linkage that an organizational culture can be developed that allows for the funding/cost to
be controlled and, ultimately, maximizes the value derived from the assets.
There are additional nuggets of information in this survey that will help companies overcome any
obstacles they may encounter when developing their asset management strategies. It is hoped that
this information will make you successful on your journey to achieving asset management.
...this information will

make you successful on
your journey to achieving
asset management.
27
Sponsors Perspective
Reliability Matters: Understanding the Impact of
ISO55000 on Asset Management
ccording to ISO55000, an asset is a thing, an item or

an entity that has actual or potential value. Therefore,
the primary objective of an effective asset management
program is to ensure that assets maximize value to all stakeholders in
the value chain, throughout the assets lifecycle.
The launch of the ISO55000 suite of standards establishes
an important benchmark for asset management worldwide and
an improved opportunity for asset management executives and
professionals to deliver increased value within their organizations.
But how? The fundamental reasons to invest in asset management
vary, but increased system reliabilitythe ability of an item to perform
a required function under given conditions for a given time interval
stands out as the primary reason with more than three quarters of asset
managers. Not surprising when one considers that a clear majority of
organizations (61%) also cited an aging assets/infrastructure as a topthree reason to improve asset management.
Unfortunately, four out of every five organizations describe their
asset information management system as inadequate to fully support
effective asset management.
We know this because we sat down with senior operations and
asset management executives from many of the worlds most assetintensive companiesthose that are IBM customers and those that
are notto gain a broad understanding of the system requirements
needed for enterprise asset management. We established a customer
advisory council, interviewed analysts and underwrote this important
survey with ReliabilityWeb.com; and they shared the objectives,
challenges and needs of their organizations.
As a result, we at IBM have a strong understanding of the investments,
opportunities and system requirements that organizations face within
enterprise asset management.
by John Clark, IBM
...the
ISO55000
suite of
standards
establishes an
important
benchmark
for asset
management
worldwide
First, even as organizations plan to increase their use of analytics over

the next five years, an increase of more than 30 percent, they still seek
the underlying information supplied from very basic work information.
More than 50 percent of survey respondents need an understanding
of failure impact and more than 45% are worried about the impact of
aging workforce and the transfer of their knowledge. They are looking
28
to asset performance measurement and metrics to

identify inefficient and ineffective assets, processes
and resources over the next year before moving to
implement advanced analytics capabilities. Unlike
traditional reporting, metrics typically measure
results against specific and quantifiable targets
to determine the behavior and performance of an
organization or individual. In asset management,
performance metrics are mainly used to assess
maintenance costs, asset failures, availability rates
and reliability rates. To increase operational and
financial performance across asset management,
organizations require business intelligence solutions
that deliver robust, pre-built metrics to measure
performance across work orders, assets and
inventory; drill down analysis to identify root causes
of failure, unreliability and unavailability; and simpleto-use dashboards that facilitate rapid analysis by
asset managers.
Secondly, the ability to anticipate the failure of
assets allows corrective action to be taken in advance,
increasing reliability and reducing costs. More than
90 percent of the surveyed responses realize there
is economic value in implementing predictive and
prescriptive analytics for long-term maintenance
planning or to accelerate corrective actions toward
real time. And yet, the majority do not yet have
a stated maintenance management strategy. If
historical data is available, organizations can use
these analytics to predict asset failures, based on
details of an asset and its operating environment and
evaluate whether their fleet of assets are meeting
mission. From there, they can define a more efficient
maintenance schedule, optimize inventory levels
and allocate appropriate resources. Stated goals of
the majority to support evidence-based decision
making, creating awareness in senior management
and identifying risk are enhanced further when
integrated with sensors. Predictive analytics can use
real-time data to detect if a failure is imminent and
direct necessary corrective actions, recommending
immediate or future repair as needed.
Finally, the timing and costs of capital investments
tend to be based on asset failure and criticality,
analysis of historical maintenance budgets or
simple assumptions, but more than 40 percent of
the responses indicate organizational culture as
the greatest barrier to achieving improvements.
ISO55000 based programs will force change from
the top by focusing the enterprise on eliminating
risk. Such a view will highlight differences in the

capital allocation strategies of an organization
as never before. These new standards create the
opportunity for companies to generate increased
value to stakeholders.
The results of this survey serve to underscore
that new ISO55000 standards will create profound
financial and operational impacts on asset-intensive
organizations worldwide. According to survey
respondents, the most common expected value
from asset management improvements are reduced
lifecycle costs, reduced risk and improved decision
making; above all, reliability matters. Yet, many will
struggle with increased complexity balancing
detailed process and information requirements,
aging assets/infrastructure and cost reduction
programs necessary to ensure assets perform their
required function for as long as they are required.
They also highlight the need for new capital planning
analysis, processes and reports to support the
change from short-term operational management
characterized by expense managementto a longer
term financial management focus characterized by
increased return on assets.
Learn to predict and prevent

asset failures, reduce
operational costs.
Complimentary White Paper:
Predictive Maintenance for
Dummies.
Available at ibm.biz/PdM-forDummies!
29
Additional Asset
Management Resources
Reliability Centered
Maintenance Project
Managers Guide
http://uptime4.me/rcm-guide
IBM
Copperleaf
Technologies
www.IBM.com
www.CopperleafGroup.com
Uptime Elements
Certified Reliability
Leaderships Body of
Knowledge
www.MRO-zone.com
The Anatomy of
Asset Management
The Institute of Asset Management
MRG
www.mrgsolutions.com
Year in
Infrastructure 2014
Next Practices for
Advancing BIM
Canadian
Network of Asset
Managers
www.cnam.ca
30
Bentley Systems
www.Bentley.com
IBM Enterprise
Asset Management
The (New) Asset

Management
Handbook
www.ibm.biz/eam-software
www.MRO-zone.com
ISO55000 Asset
Management
Forum at IMC-2014
CH2M Hill
www.IMC-2014.com
www.ch2m.com
Nexus Global
www.NexusGlobal.com
Emerson Global
User Exchange
Inspiring Integrity
Global Forum on
Maintenance and
Asset Management
www.GFMAM.org
Association for
Maintenance
Professionals
www.maintenance.org
Asset Management
Council (Australia)
www.AMCouncil.com.au
The Society for

Maintenance and
Reliability Professionals
www.SMRP.org
31
Guidance, Insight and Support for

this Research Report Provided by:
Additional Support and Research Insight Provided by:
32

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$399.

Asset Management Practices,

elcome to the Reliabilityweb.com Research Report on Asset Management

Trying to predict the

Asset Management Report

What Industry Do You Represent?

What Is Your Role Related to

Individual Contributor Other Support to Asset

How Many People Are In

Where Are You Located?

Asset Management Report

Asset Management and

I am aware they exist but not familiar of the contents

59% Aware they Exist but not

31% Well Versed

54% Aware they Exist but

I am aware it exists but not familiar of the contents

32% Not Aware

Asset Management Report

Asset Management Report

Long-Term Goals Short-Term Goals

Asset Management Consulting Services

Business Intelligence, Analytics and Reporting

Asset Performance Measures and Metrics

Asset Reliability Improvements

Risk Management and Risk Assessment

Asset Condition Assessment Tools

Asset Lifecycle Costing/Lifecycle Modeling

ISO55000 Compliance or Certification

Asset Investment Planning

Computerized Maintenance Management Systems

Reliability Centered Maintenance

Wireless or Remote Sensing Technologies

Data Quality Improvements

Asset Management Training

When reviewing the top five responses to

Rapid Adoption for ISO55000 Certification1

Asset Management Report

Gap Assessment and

Are You Planning to Conduct an ISO55000 Asset

Over the next 12 months

Over the next 1-5 years

Benchmarking is extremely important because it allows us to compare ourselves to others in

Please Indicate Your Plans Regarding

Have Already Completed Asset

No Plans to Conduct Asset

Asset Management Report

Asset Information Management

A major surprise is that less than 20

Does not support a

It fully supports effe

I am not sure what asset information management is

I am not sure what a

Top Three Plans to Improve

Implement data analytics

Integrate Capex and Opex project and

Asset Management Report

Single Biggest Obstacle for

What Is the Biggest Obstacle for

The Benefits You Expect from

Top Five Benefits You Expect From Asset Management

Identifying and Managing Risk

Extracting Data to Support Evidence-Based

Determining the Optimum Maintenance