Asset management is the way organisations connect long-term objectives with decisions about the performance, risk and cost of their physical assets. Its greatest challenge is often not a lack of systems, data or models. It is how people across the organisation make decisions together.
Why asset management depends on shared decisions
Asset management is often presented as the answer to complex challenges such as limited resources, increasing risks and ageing assets. Yet many asset-intensive organisations already have systems, data and models in place. The harder question is whether people can use that insight to make choices together.
Move from discussion to dialogue
In many organisations, decision-making revolves around discussion. Reports are written, arguments exchanged, interests defended and, eventually, a decision is made, often under time pressure. Asset management, as described in the ISO 55000 family of standards, calls for a different approach: dialogue that creates space to understand before deciding.
Do we really understand one another’s perspectives? What interests are at stake, both internally and externally? And where do our interests overlap rather than conflict?
Dialogue requires us to listen without immediately responding. In practice, this can be difficult, particularly when failures, risks or incidents demand swift action. At those moments, we tend to fall back into familiar patterns: solve the immediate problem and postpone whatever can wait.
That is understandable, but it is not effective in the long term. And the long term is at the heart of asset management.
Balance immediate pressures with long-term objectives
Asset management is often seen as a solution to immediate challenges, such as limited capacity or budget. In reality, it helps organisations understand what is genuinely needed to achieve their long-term objectives.
That insight confronts organisations with choices. Not only what to do now, but also what not to do. Which risks are we prepared to accept? Which investments do we postpone? And what are the consequences for the future?
That is what makes asset management valuable. It shifts the focus from responding to today’s problems to achieving organisational objectives sustainably over time. It enables:
- Better insight into the resources required and those currently available;
- Explicit consideration of risks; and
- Alignment between ambitions, objectives and what is realistically achievable over the desired life of the assets.
Applied systematically, asset management makes organisations less dependent on ad hoc solutions. But this requires decision-making that looks beyond today’s challenges and makes room for the long term.
The real challenge is building organisational support
The real challenge is creating support for a different way of thinking and working. Organisations are often set up to resolve immediate issues, whereas asset management requires decisions that also create value in the longer term. That is only possible when this approach is supported throughout the organisation.
It means looking ahead, making choices and accepting that not everything can be done at once. This can sometimes feel like slowing things down, even when the pressure is high. Existing assets need maintenance or replacement, while societal, sustainability and organisational ambitions must be achieved at the same time. And all of this has to happen with limited capacity, resources and budgets.
How ISO 55000 supports better asset management decisions
The ISO 55000 family of standards provides a framework for structuring conversations about assets, investments and risks. It focuses attention on fundamental questions:
- What do we want to achieve in the long term?
- Which assets, or changes to assets, are critical to achieving those objectives?
- What investments are required?
- What people, resources and capabilities are needed to manage and maintain those assets?
- Which risks are we prepared to accept, and which are we not?
Answering these questions together, rather than in isolation, shifts the focus from “How do we allocate the current budget?” to “What do we need to achieve our objectives sustainably?” That leads to different trade-offs and better-informed decisions.
Five steps to make better asset management decisions
Asset management translates long-term objectives into concrete decisions today. For example, a policy decision on climate adaptation should be informed by the new requirements and their implications for existing assets. When the decision is made, the resources needed to meet those requirements over the long term should also be secured.
This requires insight upfront. Without it, organisations cannot make well-informed decisions about resources, risks, priorities and feasibility. The following five steps help structure those trade-offs.
1. Make the gap between needs and resources visible
When setting objectives and developing new policy, understand the gap between the resources required and those currently available. Discuss the potential consequences with the teams responsible for managing the assets.
What options are available, and what would they cost? Is that acceptable? Would it be better to delay certain objectives and align them with necessary asset replacements at the end of asset life? Do we have a clear view of when those replacement moments will occur?
In many organisations, capacity, resources and budgets become the starting point for decision-making. The focus then tends to be on what is achievable today rather than what is needed over the long term to achieve organisational objectives.
Asset management makes that gap visible. Which activities are not being carried out because resources are lacking? What risks does this create? Which investments or measures are needed to balance performance, risk and cost? Making these trade-offs explicit supports a better-informed discussion about priorities and the long-term consequences of today’s choices.
2. Reassess ambitions against available capacity
Adjust objectives when available resources and ambitions cannot be brought into balance. The insight from the previous step makes clear that not everything can be achieved at once. Asset management therefore requires conscious choices.
Which objectives are essential to maintaining performance, availability and effective risk management? Which ambitions can be postponed without unacceptable consequences? Exploring different scenarios gives a more realistic view of what is achievable. For example, an organisation may decide to:
- Safeguard the availability and reliability of critical assets;
- Demonstrably meet key requirements of internal and external stakeholders;
- Postpone lower-priority investments and ambitions; and
- Focus available capacity and resources on the objectives that add the greatest value.
The outcome may not be ideal, but it reflects what the organisation can realistically achieve and the risks it is prepared to accept.
Choosing from the outset to keep three plates spinning while adding a fourth has a much greater chance of success than trying to spin seven at once and hoping none falls.
3. Translate objectives into actions and make risks explicit
Recalculate what is required to achieve the realistic objectives and identify any remaining risks. Translate the chosen objectives into concrete measures, investments and activities. Then review the capacity, resources and capabilities needed to deliver them.
Not everything will be feasible within the available constraints. Make the remaining risks explicit: which risks are managed through the chosen approach, which remain, and what are the implications for performance, availability and cost? This creates a realistic approach that reflects both the organisation’s objectives and its capabilities.
4. Limit the risks created by maintenance backlogs
Make clear where maintenance backlogs are developing and what risks they create. When capacity, resources and budgets are structurally insufficient to maintain assets properly and replace them at the right time, risks increase.
Asset management makes these developments visible and identifies the additional investment, budget or capacity required to prevent backlogs from becoming unacceptable disruption or downtime.
5. Anticipate future asset replacement needs
Develop integrated alternatives and invest in good time. This is the only way to keep future replacement needs manageable.
Many assets remain in service longer than originally expected. That may appear beneficial, but it also creates risks. When replacement is postponed for years, a growing requirement can develop almost unnoticed, until many assets need attention at the same time.
Asset management helps organisations identify this development early and look ahead. Assets constructed or installed during the same period are also likely to reach the end of their service lives at roughly the same time. Consider roads, viaducts and bridges. Without timely preparation, organisations risk having to replace them under significant time pressure, when capacity, expertise and budgets may be limited.
Identifying future replacement needs early creates room to explore alternatives, spread investments over time and make sure resources are available when needed. It helps manage risk and enables more deliberate choices, including linking replacements to wider societal, sustainability or organisational objectives.
More or larger new assets will ultimately require more management and maintenance too. Anticipating that future growth is part of effective asset management.
Turn asset management insight into shared decisions
The five steps may seem logical, but in practice they can be difficult to apply consistently. Organisations continually balance the urgent issues of today against the challenges of tomorrow. Different interests come into play: pressure to resolve failures, disruptions and backlogs immediately; governance, organisational and financial decision-making cycles; limited budgets; and shortages of skilled professionals and delivery capacity. Asset management helps make these trade-offs explicit. But insight alone is not enough. Organisations also need broad support for decisions that may only deliver results over the longer term.
Boards, management teams, finance, asset owners, asset managers and operational teams need to consider performance, risks, investments and available resources together. Approaches such as Dynamic Long-Term Asset Investment Planning (DLTAIP), alongside asset management guided by ISO 55000, support organisations in making these trade-offs. They connect long-term objectives, future replacement needs, investments and capacity so organisations can make better-informed decisions.
Ultimately, the success of asset management is not determined by the quality of systems or plans alone. It depends on an organisation’s ability to shape its future together. That is why asset management is not only about assets. Above all, it is about people, behaviours and decision-making. It requires a shift from discussion to dialogue. And that may well be the biggest organisational change of all.
Would you like to explore how your organisation can embed asset management more firmly in its culture, decision-making and collaboration? We would be happy to start the conversation.
To discuss this article, contact Marco Aberkrom: [email protected]
