Asset Management

Save Money and

Improve Productivity
Joseph DeSiena
 Asset Management - Save Money and Improve Productivity

For most businesses, the efficient tracking of their installed base or in-service equipment, and the
management of their spare parts inventories are key factors in determining the prospects for internal
productivity and customer service profitability. However, many organizations do not yet utilize a
comprehensive asset tracking and management process to ensure the availability of quality data
that can be used to generate the business intelligence that can ultimately save them money and
improve efficiency. This is unfortunate, because the tools are readily available - it is simply a matter
of making it a priority.

What is Asset Management?

There are many definitions of "asset management", although most deal primarily with financial
considerations. Some are based on evolving maintenance management systems; some on the
management of factory floor equipment configurations; and some for the purposes of monitoring
network equipment or even railway car and container locations. However, regardless of what
situation or application your business deals with, the core definition remains constant; asset
management is "a systematic process for identifying, cataloging, monitoring, maintaining, operating,
upgrading and replacing the physical assets of the business on a cost-effective basis".
To be truly effective, the asset management process must be built upon a foundation of widely
accepted accounting principles, and supported by the proper mix of sound business practices and
financial acumen. It can provide management with an effective tool that can be used to derive better
short- and long-term planning decisions. As such, it is something that every business should
consider adopting - and embracing.
After years of studying and supporting the Information Technology (IT) needs and requirements of
clients in all major fields of business, we prefer to define asset management in a more dynamic way,
encompassing each of the following four key components:
• An enabler to generate and maintain critical management data for use internally by the
company, as well as with its respective customers and suppliers (such as installed base or
maintenance entitlement data).
• A comprehensive process to acquire, validate and assimilate data into corporate information
systems.
• A flexible system allowing for either the manual acquisition and/or electronic capture and
reconciliation of data.
• A program with accurate and intelligent reporting of critical business and operational
information.
Asset management is not merely the identification and inventorying of IT and related equipment; it
is the process of making the assets you own work most productively - and profitably - for the
business. Further, it is not a system you can buy; but is, instead, a business discipline enabled by
people, process, data and technology.

What are the Signs, Symptoms and Effects of Poor

Asset Management?

Poor asset management leads to poor data quality - and poor data quality can negatively affect the
business over time. In fact, experience shows that there are a number of common causes that can
lead to poor asset management, including lack of business controls for managing and/or updating
asset data; lack of ownership for asset data quality; and an out-of-balance investment in people,
 Asset Management - Save Money and Improve Productivity
process, data and technology. In addition, some businesses may not consider asset management
to be a critical function, focusing on audits only; while others may not consider asset data to be an
important component of the business's intellectual property.
The primary symptoms of poor asset management are also fairly ubiquitous, and may include
anything from numerous compliance and security issues, to uncontrollable capital and/or expense
budgets, excessive network downtime and poor performance, under- or over-utilized assets,
incompatible software applications, increasing operational costs and headcount, and non-matching
asset data derived from different organizations and/or business systems.
Moreover, poor ongoing asset management practices can impact a business by degrading customer
service delivery, polluting the existing installed base of data and distracting sales resources with
customer data issues For example, Service Delivery may be impaired by inaccurate depot sparing
creating customer entitlement issues, increasing escalations to upper management and lowering
customer satisfaction. An uncertain installed base lengthens contract renewal cycle-time, limits
revenue opportunities and inhibits technology refresh planning. The result of poor asset
management can ultimately be devastating to a business, often leading to one or more of the
following negative impacts:
• Increased Asset Total Cost of Ownership (TCO)
• Decreased workforce productivity
• Increased non-compliance issues (i.e., SOx)
• Decreased Customer Satisfaction
• Lower Return-on-Investment (ROI) on capital investments
• Decreased network/business performance
• Increased number of internal and external audits
The causes of poor asset management can be many; the symptoms pervasive; and the results
devastating. However, the good news is that there are specific solutions available that can help any
organization avoid these pitfalls.

The PETRO Asset Management Process

Merely "chasing data" is a poor substitute for a formal asset management program and can be a
daunting, expensive and extremely unrewarding task. In order to realize the full benefits of an asset
management program, the first order of business is to move a paradigm shift away from the large,
reactive and generally ineffective mass clean-up projects that typically accomplish little or nothing;
and focus, rather, on the implementation of a set of prescribed, proactive processes that are
eminently collaborative with the customer, partner or service provider. Something more is needed;
and that something more is a formal asset management process.
The asset management tool that is ultimately chosen for use by the organization should be one that
meets its specific - and sometimes, unique - needs. This is clearly a case where "one size does not
fit all". Whether the situation calls for merely an improvement made to an existing tool, a revised or
re-engineered process, or a completely new approach, each organization's needs must be carefully
evaluated and assessed, and a customized solution must be designed and implemented to achieve
the best results.
Some organizations may already have the requisite internal skills and experience to build an asset
management solution on their own, while others will need to seek out professionals that have
significant experience in the design and development of the specific types of processes and
applications that will be required, ranging from data extraction, to data assimilation, to associated
systems development and implementation. Although many solutions may look good on paper
initially, the "devil is in the details", and the details will play a critical role in the prospects for a
successful implementation.
 Asset Management - Save Money and Improve Productivity
Whether designed internally or through an independent systems integrator, the implementation will
need to focus on the specific aspects of analysis, development and reporting to ensure for the
delivery of a complete solution and implementation. Many businesses mistakenly believe that they
can build an effective asset management tool virtually "out of the box". However, while the concept
is easily enough understood, the unique complexities of each organization's IT environment are such
that in almost all cases, outside assistance will be needed.
To address the myriad complexities that define individual business organizations, we have
developed our own asset management process, known as PETRO. Encompassing five key areas of
focus, PETRO, utilizing a Six Sigma approach, can serve as the foundation for the design and
implementation of an effective end-to-end asset management solution. The five key components
include:
1. P - Pre-Inventory: Review and Prep of Baseline - Review and validation of company assets,
spares, inventory, installed base records and required reference data; establishment of a
framework for conducting the inventory, network audit or data extraction; establishment of a
baseline for making comparisons.
2. E - Extraction: Customer Network Data Acquisition - Acquisition of data from physical
inventories, automated network discovery tools or database record extracts in various
formats.
3. T - Translation: Mapping of Data - Interpret, map and restate data from acquisition format to
a format that may be matched to the Company's baseline data.
4. R - Reconciliation: Matching, Reconciling and Editing - Validate the inventory/extraction
results to the baseline; matching and validation of inventory/extraction results to the
Company's record baseline, and the generation of associated user reports.
5. O - Original Assimilation: Transform, Integrate and Load - Process of assimilating data into
corporate systems; conversion of reconciled data into identifiable data elements with
attributes and values consistent with Company data requirements and definitions;
integration of transformed data into unique, consolidated, identifiable data instances
meeting the business data requirements; loading of transformed, integrated source data into
the Company's records.
The first pass of the PETRO process establishes a "clean" records baseline that must be maintained
over time. Since the success of any asset management solution in the long-term is directly related
to the quality of the ongoing data maintenance program employed, the respective process and
system interfaces must be designed to support the ongoing updates and assimilation of data to the
Company databases through the specific touch points where asset data is updated or changed. In
other words, the quality of data must not only be ensured throughout the entire process, but the
ability of the solution to maintain data quality over time, and through all individual touch points, must
also be protected.

Ongoing Asset Management Process at the Touch

Points

An ongoing asset management solution (also known as Move, Add, Change, Delete -MACD-process
is a streamlined version of PETRO that concentrates on ongoing control processes. It is a repeatable,
consistent process, mutually owned by the managers of the touch points (either inside or outside
the organization) and the master database of record. It should ensure the quality of the data updates
through timely and efficient processing of update (delta) records.
In situations where data is passed between different organizations, extra care should be taken to
develop a collaborative process that is transparent and ensures the quality of the data updates. The
depth and complexity of the PETRO process should be proportional to the volume and frequency of
the updates as well as the cleanliness of the data at the touch points. The processes can range from
 Asset Management - Save Money and Improve Productivity
Customer Self-Service for small manageable accounts to Fully Collaborative for large accounts with
heavy volumes and frequent data quality issues.

Key Components of the Ongoing Asset Management

Process

The key drivers of the MACD process consist of the following four components:
1. A Comprehensive Data Extraction, Translation and Reconciliation Process - Development
of both the processes and the standards for collecting data updates (electronic or manual).
- Performance of an automated, or semi-automated, process to validate, translate and
reconcile the results. - Creation of a MACD Data Manager to store and track interim records
during the ongoing PETRO processes - Development of automated status reports throughout
the process transparent to all MACD touch points - Coordinating data updates at the touch
points and/or outside (customer) locations.
2. Process, Policy and Procedure Development - Conducting the required MACD asset
management process analyses and evaluations at all touch points. - Designing and
developing processes and capabilities to support PETRO implementation. - Defining the
policy and procedures required in the asset management process for both the near- and long-
term.
3. Requirements/Systems Development - Developing all functional and systems requirements;
coordinating and engaging IT in the development of an automated system to analyze, extract,
translate, reconcile and assimilate Company data. - Development of working models and
systems, as needed, to support the asset management process.
4. Data Maintenance - Development of processes to support the asset management process
for long-term implementation, including ongoing data maintenance and integrity. -
Development of meaningful Asset Performance Monitoring and Control processes.
Article Source: http://EzineArticles.com/expert/Joseph_DeSiena/991278

About the Author

Joseph DeSiena is President of Consulting Services at Bardess Group, a Management

Consulting firm specializing in data revitalization, business process design, and
information technology for services-related businesses. He is currently a board
member of the Society for Information Management in New Jersey.
SoftExpert EAM is an Asset Management software which optimizes asset utilization and performance at
lower operating costs by eliminating unplanned downtime to maximize the lifetime value of all asset types
- production, facilities, transportation and IT - across the enterprise.

Asset inventory Calibration record

The Enterprise Asset Management software enables organizations to develop comprehensive programs
for preventive, predictive, routine and unplanned equipment maintenance and calibration, improving the
daily effectiveness of operations and technical staff. It also better manages equipment and facilities to
increase reliability and ensure regulatory compliance with laws, regulations and industry-specific
requirements, all while reducing energy usage and supporting sustainability initiatives.

Asset performance indicators Maintenance planning and control

Successful companies know that improving their asset performance reduces costs and enhances their
capacity to grow. SoftExpert EAM software helps companies improve asset performance, increase
service life, and cut costs by providing a complete set of asset management and workflow capabilities to
managers and team members.

Failure analysis Work orders monitoring

Learn More at:

https://www.softexpert.com/enterprise-asset-management-eam/
 Manage business process change with checklists
About SoftExpert
SoftExpert is a market leader in software and services for enterprise-wide business process
improvement and compliance management, providing the most comprehensive application suite to
empower organizations to increase business performance at all levels and to maximize industry-
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Founded in 1995 and currently with more than 2,000 customers and 300,000 users worldwide,
SoftExpert solutions are used by leading corporations in all kinds of industries, including
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