Improving the Delivery of Asset Management across the Enterprise

R. A Platfoot*

*Covaris, PO Box 3456 Bankstown Square NSW Australia r.plat{oot@covaris.com.au

Keywords: asset management, organisational design, information systems, maintenance strategy, reliability

Abstract

This paper sets out a methodology for the asset management transformation of a complex organisation operating multiple sites and extensive fleets of physical assets. The approach is based on PAS 55:2008 and ISO 55000 specifications for an asset management system. Case study material is utilised to draw out specific approaches for applying the techniques to deliver tangible performance improvement throughout the organisation and in particular to service delivery groups. The foundation elements include defining and communicating a clear strategy, aligning the organisation with asset management service delivery and the use of information to optImIse decision making about work delivery and investments in the assets themselves.

1 Introduction

The publication of PAS 55:2008 [1] presented a means to balance between management principles and technical services to deliver greater surety in improving asset management. The Specification was successful in promoting risk management to optimise decision making. While ISO 55000 [2] has differences in content and layout, it retained the concept of the goals of an asset management policy being achieved by meeting measureable objectives outlined or documented in an asset management strategy. It was interesting to note that ISO 55000 recognised issues with terminology where a plain English term could be misinterpreted and hence for example, what strategy meant for one person would mean something different to another. Without clarity on what the elements which make up asset management meant, the prescriptions in such specifications cannot be guaranteed to be implemented.

In this work we applied ISO 55000 as the senior document but incorporated substantial material specific to PAS 55:2008 which provided a more rounded approach to delivering enterprise level asset management. Other authoritative material has been helpful [3] (eg other ISO standards, government agency asset management manuals etc) but we were concerned with changes in interpretation of the asset management terminology outside of ISO 55000. The key

elements of this interpretation of the asset management system are found in Figure 1.

ISO 55000/PAS 55 outline an approach that once the objectives for asset management are determined, stakeholders across multiple functions need to work together on appropriate plans to determine future work. These plans are based on condition assessments and historical trends of lifelimiting issues. The issues are then risk assessed for priorities and consolidated to specify future work and hence budgets. Enabling the determination of these plans and then assuring their delivery is where the hard work arises and is the subject of this paper.

To get to the point that roles are confirmed, information is gathered and utilised, and plans can then be made requires many aspects of the enterprise to be in place and working. ISO 55000/PAS 55 provide a comprehensive check list of cultural, technical and business aspects which have to combine and assist with delivering the improvement process, [4]. The key aspects addressed in this work include:

The organisation has to know its assets; A competent and well communicated preventive

maintenance strategy is needed to drive out waste in the routine work;

Condition assessments and reliability trends have to be processed to provide essential data;

Technical support across engineering, projects and supply has to be focused on a critical few items which represent the priorities; and

The performance of maintenance, projects and operations teams needs to be precise and hold them accountable for both effectiveness and cost efficiencies.

An important driver for investment and managing the life cycle of assets is the asset management plan, [5]. In this approach the plan is not an extensive document but the repository of output from reports, analyses and studies which is combined to identify and justify optimal work. The plan is a statement of what has to be done on the assets, why, the priority, when and so forth. This is a literal interpretation of ISO 55000/PAS 55 and means the plan is a dynamic, continually updated register of information utilised by multiple stakeholders as they work together.

Business Plan

Asset Management Policy

External Audit

Asset Management Objectives

Strategic Asset Ma nagement Plan Internal Audit

Scope of Asset Portfolio

Asset Management Plan

Organisational Design

Risk Management

Information Systems

Continuous Improvement

Asset Management Enablers

Define Budget Standard Review

Stakeholder Management

Change Management

Outsourcing

Awareness

Maintenance Asset Management

Sustainment

Figure 1 Asset Management System (an interpretation ofISO 55000 with supplemental material from PAS 55)

2 The asset management organisation

The size and complexity of organisations obviously vary from modest sized businesses up to national and international enterprises with layers of governance and work delivery. Irrespective of size, asset management needs a precise set of functions to be delivered and will falter if any of these are not effectively supported, [6]. An outline of these functions and their linkages is provided in Figure 2.

Figure 2 Organisational Functions for Asset Management

Work on the assets is delivered by the Maintenance and Project teams (who may be external contractors) and is in participation with the Operations teams. If the assets are badly established, maintained or operated, no asset management approach will ensure delivery of the goals of the asset management policy. The asset management organisation needs additional teams in place to support these people and set them up for success.

In order for assets to be operated and maintained correctly, systems need to be set up, forward work planned ahead, materials and resources made available etc, [8]. Hence

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Projects and Planning groups are required to ensure that actual work undertaken is planned and scheduled to be as efficient as possible. Supply groups benefit by maximising forward lead times for ordering.

Performance and Improvement is essential as a broad but shallow capability to handle the feedback from maintenance, operations and projects. This is a critical function for continuous improvement with the skills sets required including data competence, reliability monitoring and condition appraisals. What can confuse the role specified for this group is to also lump in design-based reliability assessment techniques which are more in the province of the subject matter experts in Engineering.

Engineering experts represent people with design expertise, i.e. narrow and deep knowledge of the assets and able to resolve a small number of problems but taking some time to complete such work owing to the complexities they deal with. They are also the holders of the technical standards for the assets which must be observed in order for the enterprise to legally operate, [7].

In the commercial arena there is a need for the asset-focused elements of the organisation (i.e. those on the left had side of Figure 2) to engage with the marketing or trading arm who control the actual output of the entire enterprise (and for example earn the actual revenue or deliver the corporate mission). Trading and Marketing need advice on risks in the assets which will prevent them from committing to positions which are exposed due to reliability or capacity constraints. They can also interpret plant losses into loss revenue, providing cost data essential for optimising investments in the future

In one asset management review the capability of a base load power station was tested in the area of asset life cycle management.

5.3.10: Incidenl Response (24( '!;-

5_3_9: Shutdown & Outage _. -" .. . .5_3_11: Asset Rationalisation Managemen1(15r 'l\nd Disposal (34(

! 5_3.8 Resource Management /

(640('

5.3.6: Reliability Enginee1

\\, \

\ 5.3_2: Asset Creation ;and Acquisition (30)

5_3.5: Maintenance Delivery (1083(

Figure 3 Asset Management Audit - Life Cycle Functions

The criteria for the audit was based on ISO 55000 and what was tested was not only the function defined for a role, but whether the role worked well with other teams to deliver an effective result. The enterprise studied was very capable in delivering incident response (a score of 4). But it was held back by poor maintenance delivery owing to lack of planning, poor configuration control (i.e. specifying the assets and their maintenance strategy), all of which was aligned with a breakdown with the projects team who created assets in the first place.

The enterprise were professional in delivering asset operations but with a lack of reliability support they were limited in how they could improve and deliver a more profitable, sustainable business. The organisational deficiencies stemmed from significant gaps in their top level approach to asset management which is shown in the next set of results.

5.1.1: Asset Management Policy (81( 5".

5.1.5: Asset Management _,/ 5.1.2: Asset Management Plans (90 Objectives (85]

514: Strategic Plan'l\n

/

5.1.3: Demand Analysis (10]

/" 5.1.2: Asset Management / ' Strategy (t 09]

Figure 4 Asset Management Audit - Top Level Controls

While this enterprise had been in business for many years with long term experienced personnel, they had not right set their organisational design or processes owing to a lack of goals specified in an asset management policy and unclear objectives which had yet to be tidied into a cohesive asset management strategy. Elements of strategy and plans were

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present (scored at 2/5) but were not aligned since there was no effective policy.

Immediate improvement steps included an asset management policy, a risk management standard to prioritise asset management decision making, reset of the reliability organisation and improved processes in work planning. These steps coupled with the natural capability and expertise of the team were expected to right set how their organisation worked and as an integrated team, came together to deliver asset management.

3 Asset management planning

Staying with the case study introduced above and where they needed to improve their approach to asset management planning, the following audit extract (again based on criteria found in the Specifications) points to essential requirements of the plan.

Is there an asset management plan (24) s-

can be demonstrated bySt1j tar .

The AMP is reviewed / [BI'.

Resources are enabled to deliver AMP-specified tasks (91

!

The AMPs are optimised [91

AMP takes into account li,fe cycle activities [11]

\, \

\ The AMP is communicated to stakeholders [8]

The AMP has clear tasks [9[

The AMP sets out who is responsible for delivering tasks 18]

Figure 5 Asset Management Audit - Asset Management Plans

As the criteria indicates, the plan must be reviewed and is dynamic to specify the tasks which are then prioritised for the future. To enable this the reliability team in the case study had to be reset to ensure correct information was entering the plan to justify the right tasks which would need support and investment. In this section we now consider what an asset management plan consists of.

Figure 6 presents an overview of how work is generated and then managed in an asset management context. The reliability team is required to interpret the work completed each month and, along with other stakeholders, feedback continuous improvement which will update either the asset management plans or the routine PM strategy, [8]. In this figure the value of the asset management plan is that it drives not just work, but work which will continually improve the enterprise.

An example to show what is required in establishing and then utilising an asset management plan which meets the specific criteria set out in ISO 55000 and PAS 55 is provided from recent work completed in a national transmission authority.

Asset ManaBement

Spending reviewt.IPlanned Actual Spend}

effectiveness of current projects and maintenance work in remediation, [9].

An issue is typically defined with such detail that the risk to the enterprise is clearly defined and validated by evidence. There has to be absolute confidence in this process to enable the [mal requests for funding to be on a firm footing, allowing senior management to make trade-offs between available funds and risks to the business.

An example for defining such an issue is provided below for a gantry footing. This demonstrates the need for an issue to be tightly specified to an asset or set of assets, rather than a top level concern.

Edit Issue Number 11 (New)

- ...

L I PENPervns.e

a) Registering an issue

---....

- --== =:.....': .... --:= UMfI_2'IO ........... __ .. ::::::--.::...'"'=' .. IUIIl :::.....-=r..:.. _",,-,,_ __

! ='':'l =-=-_ =.-=:=-t u.J_.. __ ...-.-- ..... ....,

>IIH/II ::';'-::::;::.U =-.::::::::=:... _ ......... -.. - --) b) Risk ranking an issue

Figure 8 Defining an Issue in the Asset Management Plan

One or more proposals for work may be needed to fully resolve an issue. In the case study example, such solutions were drawn from the following possibilities:

Remedial work proposed for specific assets; Enterprise-wide campaigns of like work on similar

assets; Preventive maintenance improvement; Root cause analysis studies; or Major investigations requiring investment.

A proposal of work needed clear objectives and demonstrable benefits, had to be allocated to someone, had an estimated

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cost and was risk assessed to ascertain how much of the original risk in the underlying issues would be resolved.

There are numerous benefits with this approach but probably the key ones appreciated by asset owners include:

Clear list of possible investment which is risk prioritised and justified in detail;

Visibility of the mix between local improvement and remote support from corporate groups; and

The ability to hold budget decisions accountable where if funding was cut, the implications for the enterprise in terms of risk could be quantified.

Another important aspect of this approach and which relates to earlier material in this paper is the need to support communication between multiple stakeholders based in different teams. While for example reliability engineers can identify and record issues, [10], operations and maintenance would like to validate the priorities. Engineers and subject matter experts need to be involved in forming proposed solutions, and planning teams need to look at the overall portfolio and the timing of possible work.

The portfolio approach is shown in the example below.

Projects

VI'" 1 15 "r 1

Attached Solutions

1. __ -

Figure 9 Portfolio Report for the Asset Management Plan

Groups of proposed tasks (Solutions) are consolidated into portfolios or Projects which can extend over multiple years as individual tasks commence at different times. There are obvious purchasing advantages with project consolidation as well as allowing time for busy delivery teams to stage their work.

The question should be asked: why does the asset management plan as a process change the enterprise and improve its overall approach to asset management? There are several aspects to the answer:

With an asset management plan in place, information is not lost and the organisation does not lose sight of key problems which may fail at some time in the future;

Because multiple stakeholders are involved from problem identification, solution, funding and final resolution, it is beneficial for them to have a common focus to track this work; and

The asset management plan delivers surety in the investment needed to enable work that will mean assets will deliver the capability expected of them by the enterprise.

The asset management plan will only work if the organisation within the enterprise understands the specific roles of teams and how they should work with each other to a common goal as specified in the asset management policy.

4 Conclusion

This paper cannot explore all aspects of an asset management system appropriate for the modem enterprise, and hence focused on the organisation and how different stakeholders can work together for a common purpose. The framework of the approach is based on the definitions of an asset management system which are found in different but related key documents: ISO 55000 and PAS 55:2008.

Asset management is necessarily an amalgam of organisational design, information, process and culture, and nowhere is this more readily shown that the sometimes extended process to resolve complex problems with the assets. The example provided in this paper was the use of an asset management plan to identify issues by a reliability team who are monitoring the outcomes of operations and maintenance. Prioritising the issues requires risk assessment involving the operations and maintenance people most familiar with the assets. Resolving the problems may call in subject matter experts or can be left to reliability practitioners to undertake further investigation. The timing of any work and its attendant investment, plus converting a proposal of work into a detailed plan requires specialist planning support.

What brings the different stakeholders together is a sense of common purpose listed as goals in an asset management policy which covers the whole of the enterprise. To meet these goals measureable objectives should be set, some of which are the responsibility of one team and others the responsibility of someone else. The strategy is cohesive since the objectives are established so that they are reinforcing of each other rather than contradictory.

The enterprise will know when its organisation is right set and the strategy is appropriate to deliver safe, reliable and durable assets when it is getting on top of its long standing problems. This is the process best addressed by an asset management plan, and this paper proposes a literal interpretation of the many suggested attributes for such plans as found in ISO 55000 and PAS 55 combined. These resources tend to be

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reinforce each other where gaps in either can be addressed in the alternative document. Other authoritative sources on asset management should be respected and are very helpful in rounding out an appreciation of the discipline, but as ISO 55000 commits space pointing out, clarity in the terminology and defming each element of the asset management system is important to ensure multiple stakeholders understand a common approach.

Acknowledgements

This work has been funded by various Australian and NZ organisations as well as Covaris research. The author acknowledges contributors from multiple organisations as well as his colleagues in Covaris.

References

[1] BSI PAS 55-2 2008 Asset Management [2] ISO 55000: 2014 Asset Management [3] Guide to Asset Management, Part 5A: Inventory, AUSTROADS, 2009. [4] AMBOK Companion Guide to ISO 55001, Asset Management Council (Aust). 2014. [5] The New Asset Management Handbook, Reliabilityweb.com, 2014. [6] J R Lafraia & J Hardwick, Living Asset Management, E A Books, 2013. [7] de Azevedo, C. Using Asset Management methods

during the industrial plant design phase. The Asset J vol. 6, Asset Management Council (Aust). 2012. [8] R A Platfoot. "Integrating Asset Management with Work Delivery and Continuous Improvement", 8th WCEAM Hong Kong, 2014. [9] D.J. Smith, Reliability Maintainability and Risk,

8ed, Butterworth Heinemann 201l. [10] R A Platfoot. "Practical Analytics for Maintenance

Teams Using CMMS Work History", Aust. J MultiDisciplinary Eng., vol. 11 2014.