Meridium recently briefed ARC on its Asset Health Manager (AHM)  application for defining and managing asset conditions. AHM is designed to provide visibility into asset condition by leveraging existing data sources. Key findings include:

  • Business interruption continues to be the greatest risk facing manufacturers in all industries.
  • A single asset platform that leverages and maximizes the value of existing data to identify underperforming assets enables asset management by exception.
  • The industrial Internet of Things (IoT)  will up the stakes exponentially for asset management in terms of number of machines that will require monitoring and the tools needed to manage them.

Improving Uptime Most Critical 

Numerous ARC Advisory Group surveys indicate that risk of business interruption is the greatest challenge facing manufacturers in all industries. On average, unscheduled shutdowns and slowdowns cost process plants 6.2 days of production annually and can be catastrophic for the environment and fatal to humans.


ARC believes that manufacturers that employ a strategic approach to maintenance, one that includes a comprehensive asset performance management program are in the best position to respond to this challenge. The ability to accurately assess asset and system health can help to dynamically mitigate the risk of business interruption, reducing operational and maintenance costs in the process.

The reality is that most plants have a wealth of asset health information at their disposal collected from a variety of sources, including inspections, operator rounds, and smart sensors. These data are typically stored in historians and enterprise asset management systems.  Unfortunately, in a heterogeneous environment like a plant data frequently become stranded in these disparate systems, leaving manufacturers unable to leverage the potentially valuable data to their best advantage.

Leading practitioners of APM are moving towards an integrated data model supported by a system where all information is aligned with its corresponding asset. Meridium believes its APM Framework provides the infrastructure for a comprehensive APM program. The Framework includes an integration platform for asset performance data, a common set of core analysis tools for decision support, standardized recommendation management, and a risk-based approach to asset criticality. It leverages existing business systems to provide the proper context for evaluating asset risk and performance information for sustainable and continuous improvement.

Define and Manage Asset Conditions for Comprehensive APM

Managing Assets by Exception 


Managing assets by exception refers to the practice of identifying and acting only on those assets that deviate from defined operating windows. For process manufacturers, management by exception relies heavily on defining integrity operating windows (IOW), identifying damage mechanisms, and intensive data analysis. According to Meridium, the combination of its Asset Health Manager (AHM) and Policy Manager (PM)  applications deliver the structure for physical asset management by exception by leveraging and maximizing the value of existing data to forecast asset and system performance.

According to the company, its Asset Health Manager application leverages existing data sources to define and manage asset conditions for comprehensive APM. The application monitors relevant inspection, process historian, asset history, and alarm data to provide visibility into asset condition in real time. Policy Manager eliminates the need for an exhaustive IT project to develop monitoring strategies by automating the logic monitoring policies and appropriate responses. PM evaluates data from inspection systems, process historians, work histories, and other sources to define and automate monitoring strategies in context with factors like risk and criticality. It enables stakeholders in asset-intensive organizations to create standard monitoring policies to maximize utilization and minimize the risk of business interruption.  Applying the process of continuous improvement to the data (collect →  analyze → act) allows a managed approach to maintenance.

Industrial IoT Raises the Stakes 

“Industrial Internet of Things (IoT)” is the term ARC uses to refer to the emerging practice of connecting intelligent physical entities, such as sensors,  devices, machines, assets, and products, to each other, to Internet services, and to industrial applications. It is also referred to as “machine-to-machine (M2M)” communication and any number of other names.  Regardless of what it’s called, the concept employs a multi-layer infrastructure to allow information from connected entities to be used anywhere, by any sanctioned party.

ARC research estimates are there are over 3.2 million “big things that spin” (compressors,  turbines, pumps, etc.) in plants and big machines around the globe. As IoT evolves, the sheer number of machines that will require monitoring will increase exponentially, elevating the need for asset management by exception to facilitate smarter maintenance. Clearly, the ability to access, analyze, and process asset data is central to the IoT value proposition. Solutions like Meridium APM with the demonstrated ability to assess asset risk, criticality, and consequences of failure will provide organizations with a strategic advantage going forward as we move to the IoT era.


Owner/operator clients have expressed to ARC that they already have enough data;  they’re drowning in it. What they lack is ability to analyze and distill all the relevant data down to actionable information for measureable performance improvement. An effective APM infrastructure requires a platform to leverage the power embedded in various operations and maintenance applications to improve asset availability and utilization within the collective operational constraints of the organization. ARC recommends investing in solutions engineered and designed to not only leverage existing data systems, but enhance its business value to the enterprise.

All signed-in ARC Advisory Group clients can view this report in pdf format at this Link

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