Lecture 1 - Introduction to Asset Management

Lecture Overview

• Course Code: BST317

• Topic: Introduction to Asset Management

• Focus Area: Asset and Space Management

Contents Overview

1. Definition of Asset Management

2. Classification and Types of Assets

3. Scope of Asset Management

4. Asset Management Tools and Approaches

Definition of Asset Management

• Asset management is defined and structured variously by governing bodies and professional organizations.

  • ISO 55000: Defines asset management as coordinated activities to realize value from assets, balancing cost, risk, and performance over the asset's lifecycle.

  • IAM: Views asset management as a systematic process for developing, operating, maintaining, upgrading, and disposing of assets in a cost-effective manner.

  • RICS: Focuses on the strategic management of built assets across their lifecycle to optimize value, ensure efficiency, and reduce risk.

Scope of Asset Management in a Built Environment

• A systematic process for managing physical assets like buildings and infrastructure across their lifecycle.

  • Key Components:

    • Optimization of Resources: Efficiently utilizing assets for maximizing ROI while minimizing costs.

    • Sustainability: Managing assets to support environmental goals and energy efficiency.

    • Risk Management: Identifying and mitigating risks of asset failure or degradation.

    • Compliance: Adhering to legal and regulatory requirements related to assets.

Classifications & Types of Assets

• Assets are classified based on function, value, and lifespan, aiding in maintenance planning.

  • Fixed Assets: Physical structures with a long lifespan (e.g., buildings).

  • Movable Assets: Equipment and vehicles with shorter lifespans.

  • Critical Assets: Essential for safety and operation; failure has significant consequences.

  • Non-Critical Assets: Non-essential but still require management (e.g., decorative fixtures).

Tangible vs Intangible Assets

• Tangible Assets: Physical, measurable assets essential for operations (e.g., machinery, real estate).

• Intangible Assets: Non-physical assets contributing to financial success (e.g., intellectual property, brand reputation).

Asset Management Tools & Approaches

• Essential for managing built environments to optimize asset performance and reduce costs.

• Key Tools:

  • Building Information Modelling (BIM): Digital representation of asset lifecycle aiding planning and maintenance.

  • Computerized Maintenance Management System (CMMS): Tracks maintenance, schedules tasks, and logs data for asset performance optimization.

  • Integrated Workplace Management System (IWMS): Combines asset tracking with space management and sustainability reporting.

  • Geographic Information Systems (GIS): Aids spatial data management regarding asset locations.

  • Enterprise Asset Management (EAM): Comprehensive approach to managing asset lifecycles and regulatory compliance in large organizations.

Asset Management Approaches

• Various approaches ensure efficient asset management aligned with long-term objectives:

  • Lifecycle Approach: Manages assets from acquisition to disposal, optimizing each stage for cost and performance.

  • Risk-Based Approach: Prioritizes assets based on criticality and failure risk, optimizing maintenance schedules.

  • Condition-Based Maintenance (CBM): Uses real-time data to perform maintenance based on actual asset conditions.

  • Preventive Maintenance: Schedules maintenance to prevent failures and extend asset lifespan.

  • Predictive Maintenance: Uses advanced analytics to predict failures and schedule maintenance proactively.

Strategic Approach to Asset Management

• Aligning asset decisions with organizational goals in performance, sustainability, and service delivery:

  • Asset Prioritization: Management focus on critical operational assets.

  • Cost Control: Balancing CAPEX and OPEX for total cost of ownership management.

  • Sustainability: Minimizing environmental impact and supporting sustainability goals.

Conclusion

• Effective stewardship of both tangible and intangible assets ensures optimal lifecycle value.

• Asset classification aids in distinct management approaches for physical, financial, human, and information assets.

• Strategic use of management tools and approaches enhances value, efficiency, and sustainability in asset management.