Implementing enterprise asset management solutions
Mark G. Damm, CMC
KnowledgeTech Solutions Inc. 400 - 601 West Broadway Vancouver, British Columbia Canada V5Z 4C2 Office: (604) 675-6973 Mobile: (604) 218-0304 E-Mail: MDAMM@KnowledgeTechSolutions.com David E. Mulder PREPA AIRe Program Manager Intergraph Utilities Introduction A typical utility company has hundreds of thousands of assets including vehicles, pumps and facilities. The investment in these physical plants easily exceeds a billion dollars for a private or public utility. Difficult to quantify but just as valuable is the investment in the people and the supporting technology to build, maintain and operate these assets effectively and efficiently. Companies with this large physical plant are being challenged with the implementation of information technology to maximize the returns on their physical plant investments. To meet this implementation challenge, an Enterprise Asset Management Solution is required. Business Drivers for an Enterprise Asset Management Solution From a business perspective, companies especially in the utility sector are being challenged to do more with less. For example, in the electric utility market deregulation is forcing companies to ensure that assets are being operated in the most efficient manner to keep rates down. Fundamentally, three main business drivers exist. They are:
Both the private and public sectors need to eliminate premature asset replacement and the obsolescence of their asset investments. For example, the cost of replacing a new pump in a pipeline is more expensive in the long term than performing the required maintenance. Manage the overall asset life cycle cost As companies look to do more with less, they need to look at the overall impact of adding new assets to their systems. To accomplish this, they must understand the full life cycle cost of an asset. The life cycle costs of an asset can be divided into four stages:
Maintain shareable asset knowledge base Factors such as the aging work force and the volume of assets being managed are causing challenges with maintaining a reusable asset knowledge base. For example, organizations want to know the problems associated with assets and equipment: who are the best vendors and what are the best work practices? The answers to these questions must be available anywhere, anytime. Technology Drivers for an Enterprise Asset Management Solution From a technology perspective, nothing remains the same over a three-year window. Technology is becoming increasingly complex while also becoming more standardized. For example, hardware has become a commodity. Software is moving in the same direction. Some of the key technology drivers include:
Asset life cycle management is not static. New methods and techniques are constantly being tried and implemented around the world. The challenge is to share these methods and techniques to allow others to learn and adapt. Enterprise asset management solutions An Enterprise Asset Management Solution is not just hardware and software but also the information and knowledge encapsulated in the technology. It needs to incorporate the management practices and principles to make effective use of the software and related information. An EAM Solution should incorporate three main components:
The asset management framework provides the foundation for making the information tracked about assets and work come alive. The asset management framework defines what needs to be tracked with respect to the assets and work. For example, what materials are the most effective for extending the life of assets, what is the overall life cycle cost of the asset? Key within the asset management framework is to understand the timeline, which makes the information in the system become knowledge. For example, work programs can be compared over a one to five year time horizon. However, asset management programs take longer to compare say, five to twenty-five years. For organizations to make effective use of the information inherent in an Enterprise Asset Management system, a continuous improvement approach is recommended. This approach incorporates the following items:
Asset management is primarily about managing the life cycle of assets. This includes everything from identifying and planning for new assets, to acquiring or building assets through to the operations and maintenance of the assets. In implementing an Enterprise Asset Management Solution, an organization needs to incorporate the use of EAM information into its management processes and feedback loops. For example, the collection of asset performance statistics should be a by-product of the daily information tracking. Additionally, the operating statistics should be used to make purchasing decisions. Management and staff should be taught how to make better decisions using this large repository of information. The collection of the information for decision-making can be defined by process area. The process areas include:
To support the asst management business processes, an enterprise asset management solution needs to provide functionality to support following business activities:
Not only must this information be accessible everywhere, but the information users also want to view the information in many different ways. Field workers don't want a list of the assets under the ground; they want maps and drawings showing where these assets are. Management doesn't want to see all of the detailed work orders and individual activities; they want to see aggregated information depicted in graphs that highlight the trends. In summary, an enterprise asset management solution must collect and provide access to its repository of information in a multitude of different fashions to satisfy the various users. The various users include field workers, work planners and schedules, engineers, operations and dispatch staff, management and executives. The different access methods include graphic, tabular and spatial displays. Integrated Information Technology Information technology is a central tool required to facilitate effective asset management. Technology advances continue to provide new ways of tracking assets and the associated work. Historically, information technology software has been based on proprietary technologies. Separate applications exist to support specific business needs. For example, project management software supports asset construction, programmable logic controllers on pumps support asset operations and maintenance management software supports asset maintenance. As technology becomes more of a commodity, separate application software for each business need does not make sense. The move in the technology market is towards integrated software applications. This move towards integrated systems is already apparent in the Enterprise Resource Planning (ERP) market. Vendors such as SAP, Peoplesoft, Oracle and JD Edwards provide fully integrated software for the core back office functions like accounting, purchasing, accounts payable and accounts receivable. The Enterprise Asset Management (EAM) vendors are moving in the same direction. For example, SAP, Maximo and Indus provide software that can be fully integrated to the ERP. According to the Aberdeen Group, the EAM and the ERP vendors are moving to component technologies which will allow companies to package up the best software modules from each vendor to meet the overall needs for asset management functionality. Technology Directions Overall a number of technology advances are facilitating the move to fully integrated systems for asset management including:
The implementation of an enterprise asset management solution requires support from all levels in the organization. The following items should be considered during its implementation:
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