Everything You Ever Wanted to Know but Were Slightly Worried About Asking
In asset intensive organisations around the world, good asset management practices have evolved from many sources, converging over the last 30 years to international accord. But, just when you thought you had a handle on the extent of your assets requiring management, you suddenly find that their numbers have increased significantly. This is not because your assets have suddenly started procreating; it is just one of the effects of moving from PAS55 to ISO 55001.
While the focus of PAS55 is just on physical assets, it also recognises that there can be dependencies and impacts on other types of assets too. ISO 55001 is just as applicable to physical assets as PAS55, but the definition of an asset is extended to cover anything that has potential or actual value to an organisation. That value can be financial or non-financial and may vary between different organisations. This means that intangible assets such as software and intellectual property can also be managed in a way that meets recognised asset management standards.
This broader definition leads to some simplified terms and definitions. Under ISO 55001, asset management itself now just becomes the ‘coordinated activity of an organisation to realise value from asset’. In contrast, PAS55 defined asset management as the ‘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 organisational strategic plan’.
The key focus areas of asset management that have been brought forward from PAS55 into ISO 55001 are:
- ‘Line of sight’ or alignment of day-to-day activities with organisational objectives
- Whole life cycle asset management
- Risk-based decision making, and The importance of leadership, consultation, competency development and information management.
The structure of the ISO document follows the standardized terminology and layout specified by the ISO Joint Technical Coordination Group (JTCG) for all ISO management standards and is significantly different from the PAS layout. The structure it follows will now be used for all ISO management standards.
However, one important point to note with both PAS55 and ISO 55001 is that compliance with the standards is no guarantee that assets are managed effectively and efficiently. All asset types are highly interdependent and optimal organisational management requires the management of people, information, finances and aspects such as performance, behaviour and processes. So, the hard work and sweat needs to be put in at ground level and across all organisational functions. From this perspective, the ISO 55001 standard can be seen as an important enabler for achieving organisational objectives.