Fundamentals of Asset Management - 2

2.0 Definition of Asset Management

Asset Management Definition

2.1 Asset management is commonly defined as:

a. 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; or

b. A systematic process of maintaining, upgrading and operating physical assets cost-effectively;

2.2 In short, asset management is a systematic approach in managing assets in order to realize the asset stated benefits and service provision. Most management system will have two (2) separate management system that is the procuring stage and the maintenance stage of an asset, but in asset management, it encompasses the two (2) stages, as the acquisition stage will have a deep effect on the maintenance stage.

2.3 We can generally say that asset management is to ensure that all our assets will continue to provide reliable services.


3.0 Asset Management Fundamentals

3.1 To understand asset management, we must understand the fundamentals in asset management. The fundamentals are as follows:

a. Roles and responsibility
b. Asset registry
c. Asset objectives
d. Service criteria
e. Asset condition and performance
f. Asset life cycle
g. User expectations
h. Asset stakeholders
i. Asset management objectives
j. Asset planning

3.2 It is important to understand the above fundamentals in order to formulate and have an excellent asset management system in the organization. In addition, we must embrace system thinking and furthermore, asset management is a multi disciplinary.

In the next post

3.3 In the next post, I will try explain in detail, each of the fundamentals above