Studies on corporate wellness programs have shown that companies that proactively focus on improving employee health and well-being see significant benefits including a reduction in lost work days and employee healthcare costs. One of the key drivers of success for wellness programs is the proactive nature of monitoring and managing lifestyle factors such as nutrition and fitness.
Just like personal health, a utility’s assets―from power cables and substations to pipelines―need to be actively monitored and maintained in order to continue to operate at peak performance. The same holds true for other asset-intensive industries such as oil and gas and transportation. A healthy asset management strategy requires a proactive and strategic approach to meet your business needs today and lays the groundwork for long-term viability. Is your asset management strategy “fit” for the future?
Whether we’re talking about personal health or the health of your business, one thing rings true – consistency is key. Improving your overall health takes preparation and commitment. Similarly, strengthening and managing your business assets requires a clear and consistent strategy. To remain competitive, utilities and other asset-intensive industries should assess and advance the maturity of their asset management program along the following dimensions:
- Take action │Harness asset data
As healthy food fuels the body, data is the fuel required for a healthy asset management strategy. Advanced technology through smart devices, supervisory control and data acquisition (SCADA) systems and the adoption of IoT-based solutions means that more data is available than ever before. But remember data is only useful if it can be transformed into actionable insights that drive business performance and results. Put your data to work!
- Taking the first step │Develop a solid baseline of current performance of assets
You need to have clear visibility and understanding of the overall current health of your assets. Every personal health program starts with a baseline assessment, whether it’s your first weigh-in or initial evaluation with a personal trainer. The baseline must include an evaluation of how long a current asset can be maintained, and when it will need to be replaced. However, there are other variables to take into account too. Asset degradation, for instance, will vary from one location to another. An overhead power line that is in use in a coastal area may be subject to salt erosion, while same line in a hot, arid climate may suffer heat damage. Once this baseline is established, you can better develop a strategic plan for how to meet expected future performance needs.
- The “heart” of the matter │Understand the criticality of assets
A healthy asset management program must include cost-effective intervention and replacement plans for critical assets. Organizations must strike a balance between containing costs, while still continuing to deliver quality service. To do so, they must understand the consequence of asset failure in terms of impact to financial, safety, environmental and service quality business objectives. Spending money on maintaining and replacing assets which do not make a significant difference to operational performance may be an unwise business decision.
- Avoid the quick fix │Manage the total asset budget
For asset-intensive industries, short-term tradeoffs are often made between capital expenditures (CapEx) and operational expenditures (OpEx). Making short-term asset decisions to reduce either CapEx or OpEx spend independently might jeopardize the overall health of your assets in the long-term. It is necessary to ensure a balance between both CapEx and OpEx, and focus on the overall value of each asset to the organization.
- It’s a lifestyle change │Take an enterprise view of asset management
Evolving your asset management strategy will require utilities and other asset-intensive industries to integrate asset management across the entire enterprise. This requires adopting new ways of working collaboratively across the organization, such as breaking down organizational silos to integrate various data sources (operational, IT, financial, GIS, etc.) into one platform. However it enables a deeper analysis and better overall asset management performance.
I invite you to read more on this topic in our white paper on Active Asset Management: Enabling utilities to gain a competitive edge.