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Asset Management and the new ISO Standards

Much has been written about the discipline of Asset Management that is emerging as a pre-requisite for any competent asset related organisation. In the Transmission and Distribution sector in Australia and New Zealand, many utilities have established Asset Management functions within the organisational structure and many have a nominated asset manager for all or part of the asset base but globally there is still substantial misunderstanding of just what asset management is and what benefits can be obtained.

Even when asset management is the focus in an organisation, is there evidence that the organisation is performing better than its less enlightened neighbours? Do they perform better financially? Do they have a better understanding of risk? Are their assets in better condition? Do they have a better relationship with their stakeholders? We all know that comparing organisation performance is not that easy. It is certain that optimised asset decision-making is a pre-requisite in an increasingly competitive and commercial business environment.

Successful Asset Management must be fundamentally a management system that encompasses the whole organisation: not just engineering, not just IT and not just finance. In fact, asset management is not even just about the assets themselves but is also about the more fundamental objectives of the organisation that owns those assets. It is about using assets to achieve organisational objectives, seeking an optimal outcome for the organisation in terms of costs, performance, risk and even sustainability.

My personal experience in the discipline of Asset Management began in the mid 1990's when I was asked to join a small group to form the inaugural asset management group for a state owned power transmission company, at that time, a government owned Corporation but later sold and became privately owned. Fortunately now we have much more guidance in what is good practice asset management than we had in those early days.

In 2004 British Standard Institute issued PAS 55 with its 28 requirements to represent good industry practice, reissued in 2008 and still in use today. Many organisations globally have used that specification with success, either informally as a guide or they sought and achieved certification as a way to ensure that their asset management processes were at least in line with industry perception of good Asset Management practices. It is important to note that PAS 55 is still useful as a requirements checklist for an organisations asset management system and is still relevant in establishing good asset management practices.
The ISO 55000 standard (or more precisely, the ISO 55000x series of standards) was issued in January 2014 and comprises 39 subjects that together form the agreed "body of knowledge" for asset management as a whole and it's a great step forward. For anyone wanting to pursue a career in asset management then both these documents are important to master the discipline. The new standard was quickly on the ISO "best seller" list reflecting the industries interest.
For many the road to achieving certification of their asset management system is still a long way off because in many cases, senior management of some of our largest T&D companies do not yet understand the asset management discipline and (for example) are not clear if the company is a Government department, a Project Management company, a Regulated market player or a Asset Management company. Even with management commitment, developing all the necessary skills, policies, procedures, systems, practices and culture will take an organisation time to achieve. Although it is important that the organisation commits internal resources and effort to establishment of the necessary processes and documentation, there is no need for companies to "go it alone" and external assistance can be valuable in assisting in overall strategy and planning, preparation of documentation and review of processes. Often organisations have many of the requirements in some form or other.

Neither the new ISO standard or the BSi PAS 55 specification tell the asset owner exactly what to do to become a good asset manager but these documents do provide guidance on what systems, policies, processes, documents and other requirements are considered to be parts of a good asset management system. Achieving certification to either PAS 55 or in ISO 55000 may be important for a company but it should not an end in itself. The objective for all organisations that manage assets should be to continually strive to improve staff knowledge and improve processes and systems to ensure that they are using assets to achieve the organisations end goals and objectives.

Much of the writing about the launch of the ISO 55000 series has been about the requirements for certifiers. Certifiers as for other ISO standards will need to meet the requirements of the ISO 17021 Conformity assessment and will assess the Asset management System against the requirements of ISO 55001. In my view Certification of the asset management system is not as important as actually building the necessary functions and capability within the organisation for asset management. That's the challenge and that's where the benefits will come from.

In some organisations there is still some resistance to the take up of PAS 55 and that is also expected to continue with the new ISO standard. Some of this resistance appears to be a fear that comparing the organisation to best practice requirements will identify fundamental weakness and cause "embarrassment" for those responsible for asset management in the organisation. Unlike the UK, the Regulators have so far not mandated that Asset Management systems for T&D utilities must be certified. Both PAS 55 and the ISO 55000 series are extremely useful to develop a strategic roadmap aimed at improving asset management within an organisation, assisting the organisation to achieve its objectives.

I have been involved in utilities for most of my career, often responsible for managing assets, I have been involved in consulting for asset management for the last 6 years, assisting utilities with developing asset strategy, building asset management systems, understanding requirements, certification and assessment of asset management systems. Given the choice, my personal preference is to work with utilities to develop and improve their asset management approach. If certification is seen as an advantage then that can be achieved as an end result.

The new ISO standard for asset management will be broadly adopted and I will be looking with interest as the body of knowledge in asset management matures even further in future years as more organisations come to see the substantial benefits of good Asset Management.

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