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Asset Management Best Practices: Leveraging PAS 55 as the worldwide standard for asset management using IBM’s Maximo Asset Management
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Agenda
Introduction – Asset Management PAS 55 – What is it ? Scope and coverage PAS 55 and IBM Maximo Asset Management Value Drivers Summary
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Reminder: What is Asset Management?
PAS 55 defines Asset Management as: systematic and coordinated activities and practices through which an
organization optimally and sustainably manages its assets and asset systems, their associated performance, risks and expenditures over their life cycles for the purpose of achieving its organizational strategic plan
The organizational strategic plan is defined as: overall long-term plan for an organization that is derived from, and
embodies, its vision, mission, values, business policies, stakeholder requirements, objectives and the management of its risks
Extracted from Publicly Available Specification (PAS) PAS 55-1:2008, BSI September 2008
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PAS 55 – What is it ?
• The Institute of Asset Management and the British Standards Institute (BSI) worked together to develop strategies to help reduce risks to business-critical assets. This project resulted in the Publicly Available Specification (PAS) 55, first published in 2004. •. This specification (standard) is the culmination of the latest thinking in terms of best practices in asset management systems. • Assets include plant, machinery, property, buildings, vehicles, construction, etc. that have a distinct and quantifiable business function or service
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PAS 55 is relevant to all Asset Classes across Industry
Facilities, Buildings, Warehouses, Hospitals
Oil, Gas, Chemicals, Pharmaceuticals, Food, Electronics, Power Generation, Manufacturing
Defense, Airlines, Rail, Road, Automotive
Railways, Electric / Gas Distribution, Highways, Telecom, Water
Computers, Routers, Networks, Software, Auto Discovery, Service desk
Plant & Production
Real Estate & Facilities
Transportation and Fleet
Infrastructure and Network
IT Equipment
Manage Assets
Manage Asset Systems
Manage asset portfolio
Create/ acquire
Utilize
Maintain
Renew/ dispose
Capital Investments Optimization and sustainability planning
Sustained performance Cost & Risk optimization
Optimize life cycle activities
Organizational Strategic Goals
PAS 55 Asset Management System
Organization Management
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PAS 55 scope and coverage
Important interface: motivation, communication,
roles & responsibilities, knowledge, experience, leadership, teamwork
Important interface: reputation, image,
morale, constraints, social impact
Important interface: life cycle costs, capital investment criteria,
operating costs
Important interface: data on condition,
performance, activities, costs & opportunities
Vital context: Stakeholder needs, business objectives, policies, regulatory
environment, performance goals, risk management
Physical Assets Financial
Assets
Human Assets
Information Assets
Intangible Assets
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PAS55:2008 Management System Structure: measurable continual improvement is an integral part
BSI - 2008
4.5 Implementation of Asset management plans 4.5.1 Life cycle activities 4.5.2 Tools, facilities and equipment
4.3 Asset management strategy, objectives and plans 4.3.1 AM management strategy 4.3.2 AM objectives 4.3.3 AM plans 4.3.4 Contingency planning
Act
Do Check
4.1 General requirements
PAS 55:2008 management
system structure
4.6 Performance assessment and improvement 4.6.1 Performance and condition monitoring 4.6.2 Investigation of asset-related Failures, incidents and non-conformities 4.6.3 Evaluation of compliance 4.6.4 Audit 4.6.5 Improvement actions 4.6.6 Records
4.7 Management review 4.2 Asset management policy Plan
4.4. Asset management enablers and controls 4.4.1 Structure, authority and responsibilities 4.4.2 Outsourcing of AM activities 4.4.3 Training, awareness and competence 4.4.4 Communication, participation, and consultation 4.4.5 AM system documentation 4.4.6 Information management 4.4.7 Risk Management 4.4.8 Legal and other requirements 4.4.9 Management of change
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Benefits of optimized life cycle asset management:
evidence, in the form of controlled and systematic processes, to demonstrate legal, regulatory and statutory compliance;
improved health, safety and environmental performance;
improved risk management and corporate governance and a clear audit trail for the appropriateness of decisions taken and their associated risks;
improved corporate reputation - enhanced shareholder value, improved marketability of product/service, greater staff satisfaction and more efficient and effective procurement from the supply chain;
enhanced customer satisfaction from improved performance and control of product or service delivery to the required standards;
long-term planning, confidence and performance sustainability;
the ability to demonstrate best value-for-money within a constrained funding regime;
optimized return on investment and/or growth;
Holistic Systematic
Optimal
Sustainable Integral
Risk-Based
Organizational Commitment &
Culture
The dimensions of successful Asset management based on PAS 55
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Deployment of the PAS 55 standard encourages to:
Achieve asset management good practices Challenge and reduce current
time-based work and replace with a “risk-based” management approach Organize around true lifecycle
asset management processes Start processes to map the
entire asset base and create the information strategy in accordance with the company’s overall strategy
Position asset management-specific accountability from the “shop floor to the top floor” and create motivational performance management Focus on building the asset
management knowledge base. Understand and target the
tools, and engage the entire organization Adopt a truly holistic
approach by continuously challenging good or best practices.
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PAS 55 What does it require for compliance ?
An Asset Management System that meets a framework of requirements to display Asset Management competence.
Requirements are for ‘good’, rather than ‘best’ practice in each area plus evidence of processes and KPI’s for Continuous Improvement.
Specifies WHAT needs to be done, not “how”
All elements of the framework need to be covered. Excellence in one area doesn’t make up for a gap elsewhere. (this is an integration requirement)
Appropriateness, coverage & connectivity of the Asset Management system is what matters. Processes must be effective.
Requires evidence of what is being done and why. How is up to the organization. (Non Prescriptive - like ISO 9000/14000/18000)
PAS 55 is independent of industry sector, asset type, asset distribution & asset ownership structure.
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Organize around true Life Cycle Asset Management processes, commitment and expenditure trends Challenge and reduce time-based work - Replace with a Condition, Value
and Risk- based approach Place AM specific accountability from shop floor to top floor and create
“motivational performance management indicators” aside KPI’s Adopt a truly Holistic Approach - continuously challenge practices and
continuously improve
Get understanding where you are now relative to World Class performance Map the Asset Base and create the Information Strategy you need Build the Asset Management knowledge base – understand and target the
tools and engage the whole organisation (holistic approach)
PAS 55: What are the main messages?
…and why adopt anyway?
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Maximo Asset Management leverages PAS 55
Enables a natural alignment with PAS 55.. Using IBM Maximo Asset Management software supporting PAS 55 can help to:
– improve customer service, increase return on assets, enable greater compliance, improve asset performance, reduce risk—all in a shorter time period, provide better visibility and control of all required information to better align with the organization’s overall business goals and objectives.
Supports full Maintenance Management requirements. This is optimized at process level.
Examples are reactive, preventive and planned maintenance combining materials and service management.
Supports Asset Risk Management. This is optimized at asset performance level.
Examples are asset reliability, service and performance management. Maximo Key Performance Indicators (KPIs) and metrics as Mean Time To Repair (MTTR), Mean Time Between Failure (MTBF) addresses such requirements.
Supports Infrastructure Management - This is optimized at service performance level. Examples are utilities and facilities management. Maximo's spatial and linear asset management, facilities and integrated workplace management capabilities (based on integration with Tririga’s IWMS).
Supports IT Asset Management - which is important managing today's complex assets and to integrate requirements from shop floor to the corporate office.
MAXIMO ASSET
MANAGEMENT
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PAS 55:2008 Positioning with Maximo Asset Management PAS 55 4.1 : General Requirements
IBM’s Maximo Asset Management software solution is widely viewed as the EAM market leader*) and provides the following capabilities:
- A single version of the truth for all asset-related information - Support for all asset classes or asset types such as production assets, fleet or mobile assets, facility assets, as well as IT or IT-enabled assets - A place to define performance criteria and associated key performance indicator (KPI) measures - Identification of performance failure - Tracking and management of incidents, problems and change - Support for corrective and preventive action - Ability of the Maximo Asset Management workflow engine to model and monitor processes and procedures provides a communication mechanism for the user community and a secure data repository for all asset-related information.
*) Source: Gartner Magic Quadrant 2011
MAXIMO ASSET
MANAGEMENT
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Maximo Helps Manage to Policy
PAS 55 4.2 : Asset Management Policy Through the ability to configure and re-configure key business processes as part of Maximo’s capabilities, users at all levels are able to achieve alignment with the company’s overall objectives and objectives and behavior for asset management in general or more specifically for activities as capital investments, operations, maintenance and contracting. Health, safety and environmental issues (HS&E) provide a good example. - For instance, the primary objective of HS&E) initiatives is to reduce overall risk, comply with governmental regulations and create a safe, yet efficient operating environment. Achieving this objective is as much about standardizing HS&E practices as integrating these practices with day-to-day operations management. Maximo Asset Management provides a foundational enterprise platform that integrates all health, safety, and environment (including security) processes with work and asset management data and processes to provide a single view of your personnel, facilities, assets and operations.
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Maximo Enables Strategy, Objectives and Plans
PAS 55 4.3 : Asset management Strategy, Objectives and Plans A key requirement of a solid EAM system as Maximo Asset Management is to be able to integrate efficiently with a range of other systems, to have at any time only “one version of the truth” in relation to asset information. The capability to integrate with other external systems, through the IBM Maximo Enterprise Adapter or IBM WebSphere® software, and IBM service-oriented architecture (IBM SMART SOA®) components, provides a standards-based approach to systems integration. Maximo’s Asset Management functionality, including its ability to configure key processes to specific requirements, while maintaining visibility and consistency throughout the system, provides good support to meet the overall requirements of the system and to document a long-term asset management strategy and related objectives and plans.
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Maximo Provides a Platform
PAS 55 4.4 : Asset Management Enablers and Controls Maximo Asset Management provides full support to many of the functions noted in this section of the standard, including procedures and functionality for: - planning , scheduling and resource allocation, asset configuration, calibration and maintenance, spare parts maintenance, inspection and testing of systems and equipment, management of change with risk mitigation and availability of standard or user-defined key performance indicators (KPIs) combined with management dashboard capabilities based on roles. Maximo Asset Management provides full capabilities to support all types of outsourcing requirements, including service desk, service request tracking, and service-level agreement management with contracting and billing. Maximo Asset Management provides capabilities for organizational learning supported by solutions and lessons learned from applications to better manage labor skills and resource provisioning Maximo’s risk assessment capabilities are designed as an iterative process that links all associated HS&E activities and organizational data. Maximo risk assessment capabilities provide a comprehensive solution for managing risk and improving safety, reliability and compliance.
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Maximo Drives Compliance PAS 55 4.5 : Implementation of Asset Management Plan(s) The organization should establish and maintain arrangements to ensure the effective control of activities required to fulfill the asset management policy, strategy, objectives and plans
IBM has developed an implementation methodology to ensure support of all objectives for a successful implementation of the asset management solution to matches with: - the overall objectives as outlined in the PAS 55 standard requirements - overall business goals and objectives of the organization.
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Maximo Enables Full Lifecycle Management PAS 55 4.6 : Performance Assessment and Improvement
Maximo provide full support to track, monitor and manage asset condition and performance
- Corrective Action Programs, CAPA - Identification of performance failure (as in ISO 14224 - Incidents and Change Management
Maximo supports concepts of “leading” indicators - where potential problems can be identified before occurrence
and “lagging” indicators, - where analysis of past failures can indicate a decreasing performance trend Maximo manages incident, problem, change management, to support
- Identification of incidents - allocation of problems for investigations - management of changes to assets or procedures.
MAXIMO ASSET
MANAGEMENT
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Basic Components of Maximo
Addresses business challenges of, Operations, Facilities and IT
Consolidates point solutions for Asset and Service Management into a logical suite of applications including: Work, Assets, Tools, Equipment, Facilities, Calibration, Linear, Spatial, Mobile and IT
Addresses business challenges of asset-intensive industries as in:
– Manufacturing, Energy & Utilities, Oil & Gas – Infra-structure/Construction, Transportation
Provides asset and service management support for: – Asset owners/operators – 3rd Party Maintenance Service Providers – Facilities management
Includes enhanced Workflow – Event Driven – Context-based – Escalation Manager
Integrates with Financial Systems (e.g. SAP) as well as Business Intelligence (Cognos), Business Analytics (SPSS), Document Management Systems
Compliance with: ISO, ISA, ROHS, IEEE, OSHA, FDA, EMEA, etc
Standards Based - ITIL KPI, Reporting and Analysis Tools SOA technology framework compliant Long history in the industry
MAXIMO ASSET
MANAGEMENT
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Value drivers for improved asset management
Reduced Equipment Investment
Reduced Facilities Investment
Reduced Facilities Investment
Reduced Facilities Investment
Reduced Facilities Investment
Effective Service
Delivery / Profits
Generated
Capital Efficiently Employed
ROIC and Shareholder
Value / Qualitative
Benefits
Operating Costs Reduce Material Costs Reduce Material Costs Reduce Material Costs Reduce Material Costs
Reduce Service Costs Reduce Service Costs Reduce Service Costs Reduce Service Costs
Increase Labour Productivity
Increase Labour Productivity
Increase Labour Productivity
Increase Labour Productivity
Increased Customer Satisfaction
More Competitive More Competitive More Competitive Improved Safety/ lower risk
Enhanced Regulatory & OEM Relationships Enhanced Regulatory & OEM Relationships Enhanced Regulatory & OEM Relationships Enhanced Regulatory & OEM Relationships
Increased Account Penetration
Increased Account Penetration
Increased Account Penetration
Increased asset availability /service reliability
Fixed Capital
Working Capital
Increased Inventory & AR Turnover
Increased Inventory & AR Turnover
Increased Inventory & AR Turnover
Increased Inventory & AR Turnover
Revenue / Capability
Value Drivers
Increased asset availability and greater in-service reliability to provide a basis to improve service delivery/ grow more revenue from the same asset base
More timely and precise interventions improves productivity and reduces material use and in turn overheads
Increased asset lives and less downtime enables higher utilization and requires less investment in facilities/assets
OBJECTIVE Commercial - Maximize share holder value Public Sector - Effective service delivery
To realize these benefits it requires developing appropriate strategies and practical implementation approaches
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Achieving benefits requires a structured, repeatable process
Identify Benefit Opportunities
Establish Business / Benefits Case
Secure Benefits Ownership
Develop and Track Benefits Measures
Develop BR Action Plan
Execute Benefits realization Action Plan
Realize Results
Identify Value Review strategic priorities Analyze performance Evaluate opportunities Develop value proposition
Drive and Realize Value Establish performance targets accountability Drive value delivery actions Manage performance delivery Leverage successes
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What are the future challenges facing Asset Managers?
Post M & A synergies
Outsourcing / new business
models Poor reliability and utilization
Overhead costs/ Credit crunch
Globalization
Environmental/ green agenda
Capital constraints
Ageing and under
performing assets
Security, safety, compliance pressures
Ageing workforce
Competitive environment
Source: IBM Research 2009
Holistic Systematic
Optimal
Sustainable Integral
Risk-Based
Organizational Commitment &
Culture
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Asset Management and PAS 55 in the Future
Companies recognize Asset Management as a Value Added Factor,
– 30 to 50% Cost Reductions – Doubling of Equipment Capability and OEE – Delivery of stable base to enable Lean Manufacturing Principles – Assured Environmental, Regulatory and Legal Compliance – Improved Image and relationships with Customers, Insurers,
Regulators and other Stakeholders
PAS 55 – Companies will realize the benefits of the PAS 55 life-cycle approach – Drivers coming from Complexity, Regulatory, Financial, Insurance, Image – Increasing interest from Regulators: E&U, Water, Pharma, Food, Nuclear,
Transportation, etc – Sector-specific aplication guideline projects (e.g. for property involving RIBA,
BIFM, OGC + Industrial sponsors
PAS 55 is a useful element of an Integrated Asset
Management Strategy to help meet these challenges
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Questions?
Mary T Bunzel Worldwide Industry Leader Manufacturing Phone: +1 414 526 2015 Email: [email protected]
Thank you!
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