We acquire and manage assets because of the value they bring to the corporation, and we spend money and time maintaining and sustaining these assets to preserve their ability to deliver value. Yet many companies struggle with how to define, measure and communicate value. The new ISO 55000 standard underlines the importance of the concept of value, and expects us to measure value in alignment with the strategic objectives of the corporation. This session explores various commonly used methods for determining value, from simple financial methods such as Benefit-Cost Ratio or Internal Rate of Return to more elaborate multi-criteria decision making methods such as Quantized Scoring, Pairwise Comparison and Value-Based Decision Making. The benefits and drawbacks of each method are highlighted.
We then explore how to build a Value Framework by identifying the value criteria that matter most to the corporation, aligning all criteria to a common evaluation scale, and using these criteria to decide what actions or investments deliver the highest value to the corporation. In doing so we will highlight the importance of timing - since value, costs and risks all change with time.
We conclude with some examples of how Value Frameworks are deployed in practice in asset intensive organizations.
“R.A.I.” the Reliability.aiTMChatbot
You can ask "R.A.I." anything about maintenance, reliability, and asset management.