refers to systematic approach to the governance and realization of value from the things that a group or entity is responsible for, over their whole life cycles. It may apply both to tangibleassets(physical objects such as buildings or equipment) and to intangibleassets(such as human capital,intellectual propertygoodwilland/orfinancial assets). Asset management is a systematic process of developing, operating, maintaining, upgrading, and disposing of assets in the most cost-effective manner (including all costs, risks and performance attributes).
The term is commonly used in the financial sector to describe people and companies who manage investments on behalf of others. Those include, for example,investment managersthat manage the assets of apension fund.
It is also increasingly used in both the business world andpublic infrastructuresectors to ensure a coordinated approach to the optimization of costs, risks, service/performance and sustainability.
The International Standard,ISO 55000, provides an introduction and requirements specification for a management system for asset management.
The most common usage of the term asset manager refers toinvestment management, the sector of thefinancial servicesindustry that managesinvestment fundsandsegregated client accounts. Asset management is part of a financial company which employs experts who manage money and handle the investments of clients. From studying the clients assets to planning and looking after the investments, all things are looked after by the asset managers and recommendations are provided based on the financial health of each client.
Infrastructure asset management is the combination of management, financial, economic, engineering, and other practices applied to physical assets with the objective of providing the best value level of service for the costs involved. It includes the management of the entire life cycleincluding design, construction, commissioning, operating, maintaining, repairing, modifying, replacing and decommissioning/disposalof physical and infrastructure assets.1Operation and maintenance of assets in a constrained budget environment require a prioritization scheme. As a way of illustration, the recent development ofrenewable energyhas seen the rise of effective asset managers involved in the management of solar systems (solar park, rooftops and windmills). These teams often collaborate with financial asset managers in order to offerturnkeysolutions to investors. Infrastructure asset management became very important in most of the developed countries in the 21st century, since their infrastructure network was almost completed in the 20th century and they have to manage to operate and maintain them cost-effectively.2Software asset managementis one kind of infrastructure asset management.
The International Organization for Standardization published its management system standard for asset management in 2014.3TheISO 55000series provides terminology, requirements and guidance for implementing, maintaining and improving an effective asset management system.
Physical asset management: the practice of managing the entire life cycle (design, construction, commissioning, operating, maintaining, repairing, modifying, replacing and decommissioning/disposal) of physical and infrastructure assets such as structures, production and service plant, power, water and waste treatment facilities, distribution networks, transport systems, buildings and other physical assets. The increasing availability of data from asset systems is allowing the principles ofTotal Cost of Ownershipto be applied to facility management of an individual system, a building, or across a campus. Physical asset management is related toasset health management.
Infrastructure asset managementexpands on this theme in relation primarily to public sector,utilities, property and transport systems. Additionally, Asset Management can refer to shaping the future interfaces between the human, built, and natural environments through collaborative and evidence-based decision processes
Fixed assets management: an accounting process that seeks to track fixed assets for the purposes offinancial accounting
IT asset management: the set of business practices that join financial, contractual and inventory functions to support life cycle management and strategic decision making for the IT environment. This is also one of the processes defined withinIT service management
Digital asset management: a form of electronic media content management that includes digital assets
Enterprise asset management(EAM) systems are assetinformationsystems that support the management of an organizations assets. An EAM includes an asset registry (inventory of assets and their attributes) combined with acomputerized maintenance management system(CMMS) and other modules (such as inventory or materials management). Assets that are geographically distributed, interconnected or networked, are often also represented through the use ofgeographic information systems (GIS).
GIS-centric asset registry standardizes data and improves interoperability, providing users the capability to reuse, coordinate, and share information in an efficient and effective manner . A GIS platform combined with information of both the hard and soft assets helps to remove the traditional silos of departmental functions. While thehard assetsare the typical physical assets or infrastructure assets, the soft assets might include permits, licenses, brands, patents, right-of-ways and other entitlements or valued items.
The EAM system is only one of the enables to good asset management. Asset managers need to make informed decisions in order to fulfill their organizational goals, this requires good asset information but also leadership, clarity of strategic priorities, competencies, inter-departmental collaboration and communications, workforce and supply chain engagement, risk and change management systems, performance monitoring and continual improvement.
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Public asset management, also called corporatecontradictoryasset management, expands the definition of enterprise asset management (EAM) by incorporating the management of all things of value to a municipaljurisdictionand its citizens expectations. An example in which public asset management is used is land-use development and planning.
Increasingly both consumers and organizations use assets, e.g. software, music, books, etc. where the users rights are constrained by a license agreement. An asset management system would identify the constraints upon such licenses, e.g. a time period. If, for example, one licenses software, often the license is for a given period of time. Adobe and Microsoft both offer time based software licenses. In both the corporate and consumer worlds, there is a distinction between software ownership and the updating of software. One may own a version of software, but not newer versions of the software. Cellular phones are often not updated by vendors, in an attempt to force purchase of newer hardware. Large companies such as Oracle, that license software to clients distinguish between the right to use and the right to receive maintenance/support.4
Vanier, D. (2001) Why Industry Needs Asset Management Tools. ASCE Journal of Computing in Civil Engineering. Vol 15(1)
Baird, G. Defining Public Asset Management for Municipal Water Utilities.
ISO/TC 251 – ISO Asset Management Information
IAM page for introduction to Asset Management
Commodity risk(e.g.Volume riskBasis riskShape riskHolding period riskPrice area risk)
Value-at-Risk (VaR)and extensionsProfit at riskMargin at riskLiquidity at risk
Articles needing additional references from April 2015
This page was last edited on 18 April 2019, at 06:14