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Asset Management System: Getting This Sorted Out!

The asset management system is defined within (drafts) as “a set of interrelated or interacting elements” of an organization that establishes policies and objectives and processes to achieve those objectives.

In his Uptime magazine Dec/Jan12 article,“The Business of Asset Management - Part Two,”1Terry Wireman mentions that PAS55 started connecting asset management practices and policies to the financial benefits that were achieved by complying with the standard. This started to get the attention of many executives, particularly in the U.S. utility industry. This line of sightapproach will resonate with most executives, however, acceptance of any asset management standard is not a given in the worldwide business community. If there are components of the standard that do not lead to financial benefits,executives will be slow (if ever) to adopt any asset management standard.

Unless an asset management standard becomes a requirement to do business (like ISO9000), it will not be widely accepted. While many asset management professionals worldwide are involved in an effort to develop an international asset management standard, if they fail to achieve a line of sight approach that connects top line to bottom line, the effort will not be successful. After all, the goal should be trying to produce a standard that helps the business community become more competitive, not to negatively impact their financial condition.

Stark warnings indeed! What can we extract from this? Creating and maintaining this lineofsight is then pivotal. Now. Lineofsight isn’t only horizontal (in that we are looking down functional departments). Lineofsight is a) unique, b) bi-directional (not top down or bottom only), c) lateral (as well as horizontal) and d) dynamic.

We should be able to look (unobscured without ‘filters’) from
within and at any part of the system to any other part.

Caveat emptor: Having the lineofsight or the ability to see doesn’t automatically mean we know what we are looking at or that we can judge to what extent our system is working versus what we expected!

Consider that each unique company and even site-specific organizations within that same company need to implement their version of asset management and often the stated (but often overused terminology in my view...) desire is to have a living dynamic asset management system. Arbitrary compliance and conformance to a set of standards are really only part of the story and may well form only the structure and foundations for unique asset management. It is pivotally important to understand what such a system is, what it is comprised of and what the common characteristics of a system truly are generically before we scope out each organization’s specific and unique system.

What is a system?

  • A system is a set of interacting or interdependent components forming an integrated whole.
  • A system is a set of elements (often called components) and relationships that are different from the relationships of the set or its elements to other elements or sets.2

What are the common characteristics of a system?

Most systems share common characteristics, including:

  • Structure, defined by components/elements and their composition.
  • Behavior, which involves inputs, processing and outputs of material, energy, information, or data.
  • Interconnectivity, meaning the various parts of a system have functional, as well as structural, relationships with each other.
  • Functions or groups of functions.

The word system comes from the Greek, synhistanai, meaning to put together in a context. So a system is an integrated whole whose essential properties arise from the relationship between its parts and a system’s thinking is the understanding of phenomena within the context of a larger whole. The system’s properties arise from the interactions among the parts and are destroyed when the system is dissected, either physically or theoretically.

With an understanding on what a system is and the common characteristics of each system, we can look at how each unique organization deals with:

  1. What asset management is fundamentally.
  2. Showing what deploying asset management must be targeted to achieve.
  3. Showing how to measure and manage the extent to which asset management achieves this.
  4. What the structure and content of their living dynamic system needs to be and how individuals will execute specified work within and from that system.

Crucial here is understanding what is meant practically by your own unique system, and not only what it is by its piece parts, but how it operates, lives and behaves as that system. There is a fundamental need to think very carefully on what you want your unique system to do for you. Discussions must lead to a documented understanding around topics such as:

  • How will we become, to what supportable extent, process-based and less people dependant (and hence less vulnerable)?
  • How will we become, to what degree, systematic, standardized and reproducible?
  • How will we support and orchestrate the conduct of specified work at the person, activity and task levels to meet those reproducible standards?
  • We understand that we need to decompose down through process,subprocessand activity, and for the prime activities we will need content, but how do we defend why we need content in some cases and not others?
  • We can’t document everything, but equally can’t have no documentation; so how do we decide the critical matters for which we need to have written standards as content and why, and how do we want those critical things done?
  • Where will we house/host that content that helps orchestrate what we need to have done?
  • How will we know where to fit which performance metrics where to show how well our process is operating dynamically? We have to be able to measure efficiency and effectiveness concurrently.
  • We know we should not measure only at the end of any process (so we don’t allow errors and consequences to propagate and often increase), rather throughout the process, but how shall we embed proper checks and measure both efficiency and effectiveness throughout that same process?
  • How will we know where there are certain connections between certain activities and especially where we have interfaces across processes from and to other departments?
  • Of course we will need various tools and supporting physical systems, but how will we know where these tools and supporting physical systems sit, fit and cover which parts of our processes and system? We can’t have mismatches in which we have tools and physical subsystems in conflict with the business processes.
  • If my system is indeed my set of interacting or interdependent components forming my integrated whole as a set of elementsthat have structure, behavior and interconnectivity, then how do I know what my elements need to be, how they need to be structured and how I can expect them to behave with a certain connectivity?

A system is like a three-legged stool

To help us out, let’s use the analogy that a system is like a three-legged stool. One leg is the intent. The second leg is the content. The third leg is the capability. If any of the legs are too long, too short, or not there at all on a three-legged stool, it will be out of balance and will fall over.


For each true system to work, it has to address:

     1. Intent (process)

  • Our intention(s) can be shown in business process flowchart(s).
  • These processes must be created as an integrated and decomposed set down to the activity level.
  • Processes should be cross-functional (often referred to as swim lanes).
  • These same processes then depict the connectivity across the interrelated (hence cross) functions.

     2. Content (methods/means)

  • Content refers to the substance that establishes and specifies how, when and who (function) has to operate within which processes.
  • This substance will cover the prime activities that our prime functions are expected to perform.
  • Content can be of various types,e.g.,a procedure, a policy, or a standard operating procedure.
  • Content is not a set of isolated, disconnected material, but we have to know if and when there are any connections vertically and horizontally. The content is live , current and interconnected dynamically.

     3. Capability (being able to)

  • It is knowing how to use what we have as content.
  • It is determining whether what needs to be done can be done.
  • Capability is being able to prove that what we needed to be done well was actually done well.

No organization that is going to survive itself can choose to have one or two of these factors. All three must be dealt with concurrently and be ongoing dynamically for any system to be fully formed and to have a chance of working.

Consider now:

  • How well would our system work if all we had were pictures or flowcharts of what we wanted to have happen?
  • How well would our system work if we had great pictures or flowcharts of what we wanted to happen and had content embedded, but had no capabilities to conduct what was in that same content?
  • Systematic means something is well organized or arranged according to a set of plans and/or is grouped into systems.Conversely, systemic means something matters to the entire system and describes something that belongs to, works together with, or can affect the entire body or system as a whole. Keeping these definitions in mind, how systemic and systematic would our system be if we didn’t have pictures or flowcharts and had insufficient content, and we thought it was normal and acceptable that our people simply did what they thought they should in a manner that they thought was best?

Take some time to carefully study Figure 1, which shows how to link to and then use plant level benchmarking.


Figure 1:

Okay, so how can your organization tackle your unique system? We will assume as we progress through 20 progressive and interrelated steps that:

  • Asset management is new to your organization.
  • You are trying to craft why the asset management department needs to exist.
  • What the asset management department needs to do will be defined.
  • How they need to do it will be determined.
  • The asset management department will be able to perform their duties across a number of discrete sites.
  • The company will be able to demonstrate to what extent itsasset management is delivering.

Furthermore, we will fit this asset management department into a preexisting overall organization.


The 20 steps shown can be done on flipcharts with a set of colored marker pens or via a few Excel tables that become interlinked. Any organization can complete these 20 steps in about 100 to 200 hours. (As your own situation varies, certain steps can be removed or refined, but the core approach remains the same.)


Give it a try and let’s get your unique asset management system properly understood and laid out as simply as possible. In doing so, you will have bidirectional line of sight for the much lauded, but often least understood asset management system. Furthermore, beyond seeing across that system, measure and then manage that system in action.

Consider these questions and suggested answers:

  1. Would it be reasonable to expect that the ISO55000 family of international standards for asset management are properly linked to the standards and initiatives for the measurement of the performance of that same system? Yes
  2. Would it be reasonable to expect that the ISO55000 standards provide deeper help on systems and, more importantly,an understanding on each unique component specific to an organization? Yes
  3. Would it be reasonable to have a structured, standardized, professionally managed set of asset management benchmarks to determine to what extent each element of such systems performs dynamically and delivers which benefits? Yes
  4. Accepting the well-intentioned efforts of the UK’s IAM and the benefits of PAS 55, is calling for input ( an indication that we don’t yet have a concise, managed means of knowing when and why practicing asset management practices impacts benefits and by what amounts? Yes
  5. Would it be reasonable to expect that the new annex to the standard governing accreditation of assessmentbodies (ISO17021-5) will deal with how we want our assessing parties to fully deal with asset management systems? Yes
  6. Is it acceptable to our profession to still have parties with self-lauding asset management benchmarking schemes that may have been in place and conducted many times, but their structures have never changed and they haven’t exactly obtained the same scoring, limits and ranges? In other words, is it acceptable for us to say that we accept that nothing has changed and changes in performance haven’t occurred? No

Worthy of further debate and definition? When you have formed your own answers to the questions posed here, then please read the complementary article, titled:“Proving Asset Management Delivers,” available at Here we look to deal with the statement: “We must commit to actually seeing how who practically execute these ‘presumed to be best practices’ or they simply are no longer proven to be best…”


  1. Wireman, Terry. “The Business of Asset Management – Part Two.” Uptime magazine, Dec/Jan 2012,
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