Beyond CMMS: Embracing Comprehensive Life Cycle Asset Management
Managing extensive asset portfolios poses significant challenges. In a context where portfolios typically comprises tens of thousands of items, depending on outdated manual systems can swiftly result in burdensome administration, substantial unforeseen costs, and compliance complications.
Many asset-owning organisations use Computerised Maintenance Management System (CMMS) software to manage their portfolio. CMMS systems can help manage the basic, day-to-day performance and maintenance of built assets and infrastructure.
🥶 However, having solely a CMMS is only the tip of the iceberg when it comes to understanding the full scope of Lifecycle Asset Management.
The real issues are hidden: the costs you can not see, the regulations you may be in breach of, and the strategic decision you can not make because you do not have a holistic, long-term view of your portfolio and its value.
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Why CMMS is a limited tool
CMMS systems excel at tasks such as streamlining maintenance processes, tracking work orders, and scheduling preventive maintenance tasks. They also provide useful insights into asset organisation, maintenance history and inventory management.
But their primary focus is on day-to-day maintenance operations rather than taking a broader, longer-term approach. They fall short in several areas:
Too narrow an approach: CMMS systems typically focus on individual maintenance tasks, such as work orders and asset breakdowns, without considering the entire life cycle of assets. They may not capture critical data points related to asset acquisition, disposal, depreciation and long-term performance.
Incomplete asset data: Because CMMS systems primarily capture maintenance-related data, they may not provide comprehensive information about a building’s design specifications, operating conditions, historical performance and future maintenance requirements. This hinders strategic decision-making and long-term planning.
Integration problems: It’s not always possible to fully integrate CMMS with other tools and software. This means that critical data gets siloed in different systems, making it difficult to get a holistic view and analyse and leverage information for critical insights.
Lack of financial analysis: Asset managers need to evaluate the cost-effectiveness of asset investments, forecast maintenance budgets and optimise asset usage throughout their life cycles. However, most CMMS systems don’t offer this level of financial analysis.
For example, one retirement living company we worked with had implemented a CMMS system. However, asset data was only recorded at the village level, not at the level of granularity needed for compliance with the Retirement Living Act.
The company needed a powerful and comprehensive tool to capture the additional data, not just to be compliant with legislation but to make informed financial decisions and meet required service levels and other regulatory obligations.
🧊Navigating the Asset Iceberg: Why Comprehensive Management Matters
To implement Lifecycle Asset Management, built asset-owning organisations (a.k.a Infrastructure-based assets) must adopt a comprehensive approach encompassing the entire asset life cycle. From planning and acquisition to operation, maintenance, and disposal. To do this requires tools that capture and leverage all relevant data. Some of the advantages that Asset Management software offers include:
1. Strategic planning and decision-making
By taking a comprehensive approach, organisations can align asset management strategies with their overall business goals and objectives. This makes long-term planning and risk assessment easier and helps optimise resource allocation. By combining asset history and performance data with financial analysis, asset owners can make informed decisions about where to invest, what assets to upgrade and which ones to replace.
2. Centralised data: a single source of truth
With a full Asset Management platform, data from diverse sources can be integrated and centralised, rather than siloed in separate repositories where it may be lost or overlooked. This includes information from CMMS systems, financial systems, procurement systems and risk management platforms.
3. Empowers predictive maintenance
To maximise the lifetime performance and value of assets, organisations need to move from a reactive "firefighting" approach to predictive and proactive maintenance. Advanced technologies such as Internet of Things (IoT) connected sensors, conditioning monitoring systems, drones and robotics can be used to gather data, with AI, machine learning and data analytics used to predict where maintenance is needed before failures occur. This reduces legal risk, downtime and maintenance costs while enhancing safety and extending asset lifecycles.
4. Lifecycle cost analysis
High-quality, comprehensive data enables asset managers to evaluate the total cost of asset ownership over its life cycle. This financial analysis considers not only maintenance costs but also acquisition costs, operational expenses, depreciation and disposal costs. Empowered with these insights, organisations can optimise spending, prioritise investments and determine the most cost-effective maintenance strategies.
5. Compliance and risk management
Government regulations, industry standards and user expectations continue to increase. Asset Management software incorporates risk management practices to identify and mitigate potential risks associated with asset performance, safety and environmental impact. Proactively managing these risks helps organisations protect their reputation, avoid costly penalties and ensure the safety of staff, asset users and the environment.
🚩 Depending solely on CMMS systems may raise a red flag, signalling a potential lack of complete understanding or insight into your portfolio. While CMMS can assist in managing day-to-day maintenance activities, they may fall short of offering a comprehensive grasp of Lifecycle Asset Management. 🙅♀️
To truly grasp the complexities of asset life cycles and make informed decisions, organisations must adopt a comprehensive approach that integrates data and financial analysis, emphasising strategic planning and risk management. By embracing this holistic approach, asset performance and lifecycle are enhanced, adding value to the balance sheet and helping achieve long-term business objectives.
👇 What's next? To delve into Asset Lifecycle Intelligence and beyond, you have two options: reach out to us directly or for Aged Care and Retirement Living Operators, register your details below.
🟠 For Retirement Living and Aged Care Operators: Request a complimentary Compliance Health Check to kickstart your Lifecycle Asset Management Planning.
For everyone else, contact our AssetFuture experts to assess the possible lifecycle modelling scenarios and strategic insights, to help elevate your asset management reporting and intelligence capabilities. We also have a range of customer stories you can read to discover how your peers are gaining a competitive edge through our technology.