Michael Hardy

ISO defines an asset as an item, thing or entity that has potential or actual value to an organization. ISO asset management standards have been written to apply to tangible assets (e.g. equipment, property, inventory, infrastructure, IT, human resources, etc.) and intangible assets (e.g. leases, options, brands, digital assets, intellectual property, legal rights, reputation, and agreements). Simply, asset management helps organizations better achieve organizational objectives while realizing greater value from their assets.

ISO stated asset management fundamentals are summarized as follows:

• Value: asset management does not focus on the asset itself, but on the value the asset can provide to the organization.
• Alignment: asset management translates organizational objectives into technical and financial decisions, plans and activities.
• Leadership: asset management seeks to enable leadership and organizational commitment at all levels to help realize value enabled by assets.
• Assurance: asset management gives assurance that assets will fulfill their required purpose.

What is ISO 55001?

ISO 55001 defines the requirements for a management system for asset management.

The ISO 55001 management system provides a framework to establish asset management policies, objectives, processes and governance, and facilitates an organization's achievement of its strategic goals. ISO 55001 utilizes a structured, effective, and efficient process that drives continual improvement and ongoing value creation by managing asset-related cost, performance and risk. ISO 55000 and ISO 55002 complement ISO 55001 by providing the overview, principles, and terminology (ISO 55000) and guidance for its application (ISO 55002).

This standard focuses on the need for a management system, and thus does not specify financial, accounting, or technical requirements for managing specific asset types.

Why is ISO 55001 important?

Compliance with the ISO 55001 standard can support organizations that are striving for a culture of proactive, continual improvement, and can drive an organization's effectiveness and efficiency in the realization of increased value from its assets. It reflects the latest thinking and best practices in asset management.

Developing and implementing an asset management framework based on the ISO 55001 standard demonstrates to internal and external stakeholders (e.g. regulators, customers, insurers) that the organization manages its performance, risks, and costs in a very effective and efficient manner.

Recognized globally, the ISO 55001 management standard offers organizations a common language and a trustworthy decision making framework enabling consistency in asset management practices. It aligns with other ISO management standards such as ISO 9001, ISO 14001 and ISO 31000, and can contribute to an organization's development of a coherent set of management practices across all facets of its operation.

Who Promotes ISO 55000?

The Asset Leadership Network. The ALN develops and shares information which enhances the practice of Asset Management and the knowledge and skills of individual Asset Managers.

Dig Deeper [whitepaper]:

There is no shortage of information, opinion or guidance on how to build a high-performance organization, yet high-performance organizations remain the exception rather than the rule, and even rarer is the organization that routinely succeeds in all areas. Why is this true? Although the characteristics of high-performance organizations are based on common sense principles, it's difficult for organizations to consistently live those principles on a day-to-day basis. Furthermore, high-performance organizations tend to grow with their successes, and growth brings changes to activities and relationships that may not always be consistent with those principles. Sustaining a high-performance organization requires consistent leadership and attention to how these characteristics are exhibited in every facet of the organization, including asset management.

Most people, who manage physical assets or who manage organizations that rely on physical assets, have experienced significant disruptions caused by the failure to effectively manage or maintain assets. These asset-related problems may be financial in nature, such as a growing backlog of deferred maintenance, or they may be problems affecting reliability or service level. Major disasters, such as a train derailment, bridge collapse or pipeline rupture tend to capture the headlines, but even minor asset failures can have a big impact on an organization's ability to serve its stakeholders and meet its objectives.

The initial reaction when these disasters or inconveniences occur is to wonder whether there might have been some way to prevent the failure from happening. Thankfully, there is a solution already in practice that can prevent most asset-related failures: It's called asset management. This paper is an introduction to the internationally recognized standard for best practices in asset management.

This paper is primarily intended for people who work in private and public-sector organizations that rely on physical assets to accomplish their missions. ISO 55000 stipulates that top management must provide leadership if asset management is to be successful, so it follows that the ideal target audience for this paper is a C-level executive, government agency director or other senior decision maker with overall responsibility for organizational performance. In practice, however, asset management execution will rest with department managers and business unit directors who control or oversee some part of the organization's assets. Additionally, budget directors, capital planners, risk managers, controllers and other performance managers will benefit from understanding the management system approach described here.

We also believe that this paper has value for people whose organizations value assets such as financial instruments, human resources, brand reputation and intellectual property. The principles of ISO 55000 and management system approach to asset management apply equally well to these non-physical asset types. Others who will benefit from this paper include regulators of utilities, bond holders and other lenders, business investors, and government grant-making agencies that play the role of investors.

Asset Management is Strategic

Strategic Asset Management Plan (SAMP): documented information that specifies how organizational objectives are to be converted into asset management objectives, the approach for developing asset management plans, and the role of the asset management system in supporting achievement of the asset management objectives.

The SAMP should be used to guide the setting of its asset management objectives, and to describe the role of the asset management system in meeting these objectives. This includes the structures, roles and responsibilities necessary to establish the asset management system and to operate it effectively.