BLOG1a - Know Your Assets - Guidelines & Practical Use Cases

In addition to BLOG1, we're going to explore the nitty-gritty of setting up a reliable asset register and dissecting assets, along with highlighting the key distinctions between product lifecycle management and asset lifecycle management. I'll also share some useful principles and approaches. Let’s start with a visual to explain the life from a product or an asset (from cradle to grave):

To set up an asset life cycle from As-Required principles to decommissioning, the follow steps are taken:

1.?Define Asset Requirements (As-Required)

• Objective:?Establish what is required from the asset, considering its purpose, performance criteria, and expected outcomes.
• Activities:?Conduct needs analysis, define performance standards, and develop specifications based on operational, safety, and compliance requirements.

2.?Design & Plan

• Objective:?Create detailed designs and plans that meet the As-Required specifications.
• Activities:?Design the asset considering reliability, maintainability, and sustainability. Develop a comprehensive plan covering procurement, implementation, and maintenance strategies.

3.?Procurement & Construction

• Objective:?Acquire and build the asset as per design specifications.
• Activities:?Source materials, select vendors, manage contracts, and oversee the construction/installation process to ensure adherence to design and standards.

4.?Commissioning & Handover

• Objective:?Ensure the asset is ready for operation.
• Activities:?Conduct testing, quality assurance checks, and validation against requirements. Train operators and hand over to the operational team.

5.?Operate, Guard & Maintain

• Objective:?Operate the asset efficiently while maintaining performance standards.
• Activities:?Implement operational best practices, monitor performance, and conduct regular maintenance using methodologies like RCM (Reliability-Centered Maintenance) and FMEA (Failure Mode and Effects Analysis). Utilize predictive maintenance where applicable to reduce downtime and extend asset life.

6.?Monitor & Optimize

• Objective:?Continuously improve asset performance and reliability.
• Activities:?Use data analytics and performance monitoring tools to track asset health and identify areas for improvement. Implement optimization strategies like Condition-Based Maintenance (CBM) and Reliability-Centered Maintenance (RCM) for enhanced efficiency.

7.?Refurbish/Upgrade

• Objective:?Extend the asset's useful life or improve its performance.
• Activities:?Assess the need for upgrades or refurbishments based on asset condition, technological advancements, or changes in operational requirements. Execute upgrades/refurbishments to enhance asset functionality.

8.?Decommissioning & Disposal

• Objective:?Safely remove the asset from service once it is no longer viable or needed.
• Activities:?Plan for decommissioning considering environmental, safety, and regulatory compliance. Dispose of or recycle the asset responsibly, ensuring minimal impact on the environment.

Best Practices

• Lifecycle Management:?Adopt an Asset Management Framework such as ISO 55000 to provide structure and ensure best practices throughout the lifecycle.
• Stakeholder Engagement:?Involve stakeholders at each stage to align asset management strategies with business goals. this implies that teams with system engineers, asset managers, maintenance- and reliability engineers are working together during the entire life cycle, taking into account that both product lifecycle management and asset lifecycle management do have a strong "overlap" but do have different goals, objectives and key focus areas.
• Continuous Improvement:?Regularly review lifecycle processes to identify improvements and adapt to changes in technology, regulations, and business needs.

The difference between PLM and ALM

IBM Maximo implementation projects have been quite the journey for me. One thing that stood out to me This is how the engineering and asset structures can get a bit tangled up, creating a breakdown structure that feels like a maze. It can get to a point where you're not even sure what's what anymore - whether it's an asset, a product, a spare part, or even just a disposable or consumable item. Before diving into setting up a solid Asset Breakdown Structure for implementing Asset Management supported with an EAM system, it's important to have a good grasp of the differences and similarities between PLM and ALM. This awareness is key to prevent ending up with an overly complicated breakdown.

Product Lifecycle Management (PLM) and Asset Lifecycle Management (ALM) are both crucial processes in handling a company's resources, but they each have their own unique areas of focus. Let's dive into the distinctions between the two:

Definitions and focus areas

Product Lifecycle Management (PLM):

• Definition: PLM is all about overseeing a product's entire journey, starting from the initial idea, moving through design and production, and ending with service and disposal.
• Focus: PLM is mainly concerned with bringing a product to life, managing its development from concept to market. This involves everything from design and production to enhancing the product, all while focusing on innovation, speed-to-market, and meeting customer demands.
• Key Areas: Product design, research and development (R&D), engineering, prototyping, production planning, product launch, and ongoing enhancements.

Asset Lifecycle Management (ALM):

• Definition: ALM revolves around handling an organization's physical assets throughout their lifecycle, starting from acquisition, moving through operation and maintenance, and finally, disposal or replacement.
• Focus: ALM is all about efficiently managing and maintaining physical assets to maximize their value, efficiency, and longevity. The goal is to cut costs, minimize downtime, and ensure assets perform as needed throughout their entire lifecycle.
• Key Areas: Asset acquisition, deployment, maintenance, operation, repairs, upgrades, and retirement.

Scope of Application

PLM:

• Scope: Product Lifecycle Management (PLM) is a key player in industries like automotive, aerospace, electronics, and consumer goods. It's all about guiding products from the drawing board to store shelves.
• Examples: Think overseeing the journey of a fresh car model, a sleek smartphone, or a heavy- duty industrial machine, right from the initial idea to hitting the market.

ALM

• Scope: Asset Lifecycle Management (ALM) steps in to keep things running smoothly in sectors like manufacturing, utilities, transportation, and healthcare. It's all about ensuring operational efficiency and asset reliability.
• Examples: Picture handling the lifecycle of machinery in a factory, power generation equipment, IT infrastructure, or a fleet of transportation vehicles.

Lifecycle Phases

PLM Lifecycle Phases:

1. Concept: Idea generation, market research, and feasibility analysis.
2. Design and Development: Detailed design, engineering, prototyping, and testing.
3. Production and Manufacturing: Mass production, quality control, and scaling.
4. Launch: Marketing, distribution, and sales.
5. Service and Support: Post-launch improvements, customer service, and product upgrades.
6. End of Life: Product discontinuation, recycling, or disposal.

ALM Lifecycle Phases:

1. Planning and Acquisition: Identifying asset needs, procurement, and financing.
2. Deployment: Installation, commissioning, and integration into operations.
3. Operation and Maintenance: Regular use, preventive maintenance, and repair.
4. Monitoring and Optimization: Condition monitoring, performance optimization, and predictive
5. Decommissioning: Disposal, recycling, or replacement of the asset

Goals and Objectives

PLM:

• Innovation: Let's drive product innovation to keep up with market demands.
• Time-to-Market: We should work on reducing our time to market to stay ahead of the competition.
• Cost Control: It's important to manage development costs effectively to ensure profitability.
• Customer Satisfaction: Our goal is to make sure our product meets customer expectations and quality standards.

ALM:

BLOG1a - Know Your Assets - Practical Use Cases

• Asset Efficiency: We need to maximize asset utilization and performance for optimal results.
• Cost Management: Let's focus on minimizing the total cost of ownership (TCO) by optimizing maintenance and reducing downtime.
• Reliability and Safety: Ensuring that our assets are reliable and safe throughout their lifecycle is key.
• Compliance: We must meet all regulatory requirements related to asset management and safety.

Technology & Tools

PLM:

• Tools: PLM software like Siemens Teamcenter, PTC Windchill, and Dassault Syste?mes' ENOVIA are used to manage product data, collaborate on designs, and streamline product development processes.
• Integration: Often integrates with Computer-Aided Design (CAD) systems, Product Data Management (PDM) tools, and Enterprise Resource Planning (ERP) systems.

ALM:

• Tools: ALM systems like IBM Maximo Application suite are used to manage the entire asset life cycle once acquired and commissioned.
• Integration: Typically integrates with systems for condition monitoring, predictive maintenance (e.g., IoT sensors), ERP, Financial Systems, Geographical Systems (like ESRI), BIM Systems to support digital twinning, etc. Since the Industry 4.0 and 5.0 concept is brought into practice, IBM integrates seamless with sustainability solutions like Envizi, Tririga and ELM solutions like IBM ELM Suite.

End Users

PLM:

• Users: Typically used by product managers, engineers, R&D teams, designers, and manufacturing planners.

ALM:

• Users: Used by asset managers, maintenance teams, operations managers, facilities and RAMS engineers

Summary

Product Lifecycle Management (PLM) is focused on managing the lifecycle of a product from its initial idea to its withdrawal from the market, emphasising innovation, design, and development. Asset Lifecycle Management (ALM), on the other hand, is concerned with managing the lifecycle of physical assets used by an organization, focusing on maximising asset efficiency, minimising costs, and ensuring reliability and compliance. While both processes involve lifecycle management, PLM is about creating and managing products, and ALM is about optimising the performance and value of assets throughout their lifecycle.

Example: Schematic Breakdown Structure according to PLM and ALM

Maturity approach when setting up an Asset Register

Implementing Asset Life Cycle Management (ALCM) in a structured and mature manner involves progressing through a series of logical and convenient maturity steps. Each step builds on the previous one, enhancing the organization’s capability to manage assets effectively from the As-Required phase through to decommissioning. Here's a step-by-step maturity model:

1. Initial/Reactive Stage

• Focus:?Basic understanding and reactive management of assets.
• Key Actions:Address immediate issues and critical failures as they arise.Basic record-keeping of asset details and maintenance activities. No formal processes or predictive strategies.
• Objective:?Establish a basic asset inventory and reactive maintenance approach.

2. Planned Stage

• Focus:?Implement planned maintenance to reduce downtime.
• Key Actions:Develop planned maintenance schedules based on manufacturers' recommendations.Basic asset management processes are established, focusing on routine tasks.Begin defining asset requirements (As-Required) and basic asset specifications.
• Objective:?Move from reactive to planned maintenance to increase reliability.

3. Proactive/Preventive Stage

• Focus:?Prevent issues before they occur by improving asset condition and performance monitoring.
• Key Actions:Introduce preventive maintenance based on asset criticality and failure modes.Use preventive maintenance techniques like RCM (Reliability-Centered Maintenance) and FMEA (Failure Mode and Effects Analysis).Improve data collection on asset performance to inform maintenance planning.
• Objective:?Shift focus from planning to proactively managing asset health and extending asset life.

4. Predictive Stage

• Focus:?Use data-driven insights for predictive maintenance.
• Key Actions:Implement condition-based maintenance (CBM) using sensors and real-time data.Develop predictive models and analytics to forecast failures and maintenance needs.Enhance planning with a deeper understanding of asset degradation and failure patterns.
• Objective:?Use predictive analytics to anticipate maintenance needs and prevent failures.

5. Optimized Stage

• Focus:?Fully optimize asset performance, reliability, and cost management.
• Key Actions:Integrate ALCM with other business processes (e.g., finance, operations) using an Enterprise Asset Management (EAM) system.Implement continuous improvement strategies like Lean or Six Sigma to optimize asset management processes.Develop comprehensive life cycle cost models to support investment decisions in refurbishment or replacement.
• Objective:?Achieve optimized asset performance through integration and continuous improvement.

6. Integrated Stage

• Focus:?Achieve full integration and strategic alignment of ALCM with organizational goals.
• Key Actions:Embed asset management into the organization's strategic planning and decision-making processes.Utilize advanced technologies like AI, IoT, and digital twins for real-time asset management.Align asset management with sustainability goals, considering the environmental and social impact of asset decisions.
• Objective:?Ensure that ALCM is fully integrated and aligned with business strategy and long-term objectives.

7. Decommissioning and Renewal Stage

• Focus:?Efficiently manage the end-of-life phase of assets.
• Key Actions:Develop and implement decommissioning plans that ensure safety, compliance, and environmental responsibility.Evaluate the potential for asset reuse, recycling, or repurposing.Capture lessons learned and feed back into the ALCM process to refine asset requirements for new or replacement assets.
• Objective:?Ensure responsible asset disposal and capitalize on renewal opportunities, feeding insights into the next asset cycle.

Best Practices Throughout the Maturity Journey:

• Stakeholder Engagement:?Continuously involve key stakeholders to ensure alignment with business needs and objectives.
• Standards and Frameworks:?Utilize standards such as ISO 55000 to guide the maturity process and ensure consistent application of best practices.
• Technology Enablement:?Leverage business functionality / technology at each stage to enhance data accuracy, decision-making, and process efficiency. As mentioned in BLOG1, use the ZNAPZ BCM (business capability model) as an "umbrella" to add extra business feature, which ensures that data and processes are defined, approved and embedded before adding the new technology capabilities.
• Continuous Improvement:?Regularly review, assess, and enhance ALCM processes to adapt to evolving needs and opportunities. this enables a human-centric focus to ensure acceptance and adoption.

In Europe, there’s a saying: "Naples and Rome weren't built in a day." This perfectly illustrates that expecting to have complete asset data from the very start is like dreaming of instant riches in a perfect world—it’s an admirable goal, but the reality is far more challenging than anticipated. The desire for fully detailed data is strong, but achieving it requires time, effort, and patience.

Context Diagram Examples:

Converting these principles into a schematic context diagram that is fully aligned with the BCM model and covered in IBM Maximo Manage, the outcome could be like the following examples. "Behind the scenes" of every "blue box" is a detailed process involving data collection, establishing effective procedures with RACI matrices, making decisions, reaching consensus, and providing clarity.

Level 1: example - starting to setup an asset register.

Start small and simple with the bare minimal asset information (Asset ID, TAG, Location, description), taking into account that the code and describe the asset is following agreed naming- and coding conventions. Try to avoid to create a "meaningful" asset number (should be unique and only referencing the asset). Prefixes and auto numbering in this will help! Never combine asset / location combinations (regardless text or number) as a unique asset number.

Level 2: example - add more operational asset data

Let's enrich the asset with asset class, type and the bare minimal specification to ensure that you have enough asset specs and vendor data to buy a new one or alternative that meet the same specifications. Add geographical information (such as a service address, a work zone or a floor where the asset is physically located). If documents are available, link them to the asset. Keep in mind that not everything from an asset related specification document or guide "must' be digitised into your EAM system. Keep It Simple Stupid (KISS). It really doesn't add any added value

Using context diagrams helps you visualize the added value by aligning asset information with your current maturity level. It assists in determining the requirements to progress to the next level. With over 25 years of experience in Asset Management and IBM Maximo, I've found that the most challenging aspect is gathering meaningful data and filtering out irrelevant information and processes that do not contribute to asset management value.

By applying this contextual approach realistically, the optimal outcome may resemble the following. I use the term "optimal" deliberately, as it signifies the best fit for your current stage and progress. Asset Management, in the ever-evolving business landscape, necessitates continuous monitoring of asset information to ensure effectiveness.

Asset Breakdown Structures

In Asset Management, an Asset Breakdown Structure (ABS) is a hierarchical framework that organizes assets into categories and subcategories, making it easier to manage, track, and maintain them. The breakdown structures are typically designed to reflect the complexity of assets within an organization and can vary depending on the industry and specific organisational needs. Here are some of the most common or standard Asset Breakdown Structures:

Functional Breakdown Structure (FBS):

• Description: This structure organizes assets based on their functional purpose within the organization. It breaks down assets according to the roles they play in achieving operational goals.
• Example: In a manufacturing plant, an FBS might include major functions like production, quality control, and logistics, with each function further broken down into specific assets like machines, testing equipment, and transportation vehicles.

Geographical Breakdown Structure (GBS):

• Description: Assets are organized based on their physical location or geographical area. This is particularly useful for organizations with assets spread across multiple sites or regions.
• Example: A utility company might use a GBS to categorize assets by city, district, or even by specific facilities, such as power plants or substations within those areas.

System Breakdown Structure (SBS):

• Description: This structure categorizes assets according to systems or subsystems they belong to, making it easier to manage interrelated components within a system.
• Example: In an aerospace context, an SBS might include systems like propulsion, avionics, and landing gear, with each system further broken down into its constituent parts and components

Product Breakdown Structure (FBS):

• Description: Often used in manufacturing or product-oriented industries, the PBS organizes assets based on the end products they contribute to.
• Example: In an automotive factory, a PBS might categorize assets by vehicle models, with subcategories for engines, chassis, interiors, etc.

Asset Class Breakdown Structure (ACBS):

• Description: Assets are grouped according to their class or type, such as fixed assets, IT assets, or intangible assets. This is a more traditional approach that aligns with accounting and financial reporting needs.
• Example: An organization might classify assets into categories like buildings, vehicles, machinery, software, and intellectual property, each with its own subcategories.

Lifecycle Breakdown Structure (LBS):

• Description: This structure categorizes assets based on their lifecycle stages, from acquisition to disposal. It helps in managing the lifecycle costs and maintenance schedules of assets.
• Example: A company might use an LBS to organize assets by stages such as procurement, operation, maintenance, and decommissioning.

IBM Maximo Manage offers support for various combinations of the structures mentioned above through the location systems feature. This allows stakeholders in the Asset Lifecycle to access different perspectives. For example, a Reliability Engineer can view a functional breakdown, while Planning & Dispatching can focus on a physical (or geographical) breakdown, and Operations can analyse a process decomposition.

An example of a process breakdown:

An example of a functional breakdown:

Industry Specific Standards

Since way back when, a ton of regional, national, international, and global standards have been laid out to guide folks on setting up a solid asset register using various breakdown techniques. And guess what? On top of all that, there are even more custom "twists" thrown in by customers because, hey, everyone likes to think they're doing something unique and special. Take the Water Management Industry, for instance, where 10 similar water treatment companies could easily have 11 different takes on how they break down their assets. lets pick one standards to explain in more detail.

NEN-EN 2767

The NEN-EN 2767 standard, commonly referred to as EN 2767 (European Standard) or ISO 55000 series, outlines requirements and guidance for the implementation, maintenance, and improvement of an Asset Management System (AMS). It is part of a broader set of standards aimed at ensuring that assets are managed effectively to deliver value to an organization, balancing performance, risks, and costs throughout their lifecycle. This standard is primarily used in the infrastructure, real estate, and utilities sectors. It is particularly prevalent in industries where the maintenance and management of physical assets, such as buildings, infrastructure, and utility networks, are critical to operational success. Here’s a more detailed breakdown:

Infrastructure (Transportation and Civil Engineering):

• Usage: NEN 2767 is widely used in the management of roads, bridges, tunnels, railways, and other transportation infrastructure. It helps organizations in assessing the condition of these assets, planning maintenance activities, and ensuring that the infrastructure remains safe and functional over its lifecycle.
• Example: A national highway authority might use NEN 2767 to assess the condition of roads and bridges, determining when maintenance or replacement is necessary.

Real Estate and Facility Management:

• Usage: In real estate, NEN 2767 is used for the condition assessment of buildings and other facilities. It supports asset managers in maintaining buildings, optimizing maintenance schedules, and ensuring compliance with safety and regulatory standards.
• Example: Property management firms use NEN 2767 to systematically evaluate the condition of residential and commercial buildings, aiding in long-term maintenance planning and budgeting.

Utilities (Water, Energy, and Telecommunications):

• Usage: Utility companies use NEN 2767 for managing extensive networks of physical assets such as water pipelines, electrical grids, and telecom infrastructure. The standard helps in ensuring the reliability and efficiency of these essential services.
• Example: A water utility company might use NEN 2767 to assess the condition of its pipeline network and prioritize maintenance activities to prevent service disruptions

NEN-EN 2767 supports a sound Asset Breakdown Structure (ABS) by providing a standardized approach to asset condition assessment and management, ensuring that assets are categorized, monitored, and maintained effectively. Here’s how it does this:

Standardized Condition Assessment:

• Systematic Evaluation: NEN 2767 offers a uniform method for assessing the condition of assets, which can be consistently applied across different asset categories. This standardization is crucial for building a reliable ABS, as it ensures that all assets are evaluated using the same criteria.
• Condition Scores: Assets are assigned condition scores based on their physical state, performance, and remaining useful life. These scores can then be used to categorize assets within the ABS, allowing for easy identification of assets that require maintenance or replacement.

Hierarchical Asset Structuring

• Categorization by Function and Type: NEN 2767 encourages the breakdown of assets into logical categories and subcategories based on their function, type, and criticality. This hierarchical structuring aligns with the principles of an ABS, making it easier to manage assets at different levels (e.g., systems, subsystems, components).
• Prioritization: By categorizing assets according to their condition and importance, organizations can prioritize maintenance efforts within their ABS, focusing resources on critical assets that require immediate attention.

Lifecycle Management

• Alignment with Lifecycle Phases: NEN 2767 helps organizations track assets through their entire lifecycle—from acquisition to disposal. The ABS can be designed to reflect these lifecycle phases, ensuring that each asset is managed appropriately at every stage.
• Cost and Risk Management: The standard facilitates the integration of cost and risk considerations into the ABS. By linking assets to their condition and performance data, organizations can better predict maintenance costs and manage risks, ensuring that the ABS supports long-term sustainability.

Integration with Asset Management Systems:

• Software Compatibility: NEN 2767 is often integrated into asset management software systems that support ABS, such as IBM Maximo or similar tools. These systems can use the condition assessment data from NEN 2767 to populate the ABS, automate maintenance schedules, and generate reports.
• Data Consistency: The standard ensures that data across different assets is consistent, which is crucial for maintaining an accurate and reliable ABS. Consistent data allows for better decision-making and more efficient asset management.

NEN-EN2767: a logical decomposition and condition assessment framework:

Beside the Asset Breakdown Structure, NEN2767 (1-4) contains predefined calculation methods how to calculate the asset condition for different types of assets. When you just have started with setting up your asset register, there is a theoretical "safety net" that calculates the initial score based on the installation date and the expected life in years. based on this 2 parameters the expected EOL (End of Life) is easy to calculate as a starting point.

Examples of a NEN-EN2767 breakdowns in Maximo Manage:

NEN2767 Condition Score Visualisation Example (IBM Maximo Health)

Example - Health Map Dashboard NEN2767 Asset Condition:

Example - Health NEN2767 Asset Detailed Overview