Enterprise asset management (EAM) is a multi-functional discipline with many moving parts, from managing capital projects to equipment maintenance to MRO supply chain activities. However, getting these functions working together in a well-oiled manner towards a common goal can be complicated, and some organizations still do not have a plan or strategy to guide their asset management efforts.
As a result of this disconnect, EAM initiatives (e.g., EAM/CMMS implementations, key performance indicators, etc.) are implemented without a strategy to guide and focus efforts. Improvements in EAM take time; without a plan, the initiatives tend to shift and drift, lose momentum, and underperform. In the end, EAM doesn’t deliver a clear and tangible return on investment, and Yogi’s statement becomes true: without a plan, you may end up where you didn’t intend to be.
A Strategic Asset Management Plan (SAMP) for EAM can help fix this. A SAMP is your plan, your single, forward-focused vision for how managing the organization’s physical assets will help achieve goals. A SAMP connects the dots between the executives and the technicians in your organization, simplifying and formalizing coordination between parts and acting as a compass to keep your teams headed in the right direction.
Developing a SAMP
A SAMP consists of actions to connect the organization’s physical assets to its goals. Here is how to develop one.
Step One – Understand Organization Goals. A SAMP should start with goals and work backward to explain how enterprise asset management functions (i.e., maintenance, engineering, operations, MRO supply chain, etc.) will help achieve those goals. A good understanding of the organization’s goals is required, and goals are typically identified in the corporate strategic plan.
Step Two – Identify EAM Drivers. Once organizational goals are understood, the next step is identifying the EAM drivers that are instrumental in achieving goals. EAM drivers are the high-level things you’ll focus your efforts on as you strive toward realizing goals. For example, asset reliability is a key EAM driver that can significantly impact costs, and financials are typically part of an organizational goal.
Step Three – Identify EAM Objectives. Drivers lead to establishing objectives; objectives are what you intend to accomplish. EAM objectives must be SMART (Specific, Measurable, Attainable, Relevant, and Time-bound). For example, improving equipment availability by 3 % by January 2023 is an objective tied to the asset reliability driver. It indicates what the operation wants to accomplish, is measurable, and includes a clear deadline. All of these aspects are critical to a good EAM objective.
Establishing objectives is the most critical part of developing an EAM strategy. Objectives lead to action plans and KPIs. Don’t shortcut this effort. When EAM objectives are not created, action plans and KPIs are left hanging. There is nothing to tie them to the big picture, and this mistake can return to haunt the EAM operation later.
Step Four – Build Action Plans. Developing a SAMP involves determining actions to achieve the objectives and mobilizing resources to execute the actions. These are the actions you intend to take to accomplish your objectives. Actions are the layer of the SAMP that outlines the tangible tasks people in the organization will take to achieve objectives. They must be concrete and contain a deadline and a clear articulation of your actions.
Your actions must align with at least one of your EAM objectives and describe how you will achieve the objective. For example, to improve equipment availability, you might implement the reliability module in your EAM/CMMS by January 2023 or implement predictive maintenance techniques like vibration monitoring for rotating equipment by March 2023.
Step Five – Identify Key Performance Indicators. KPIs are measurable values that show your organization’s progress toward achieving objectives and are a form of organizational communication. They allow you to determine whether you’re behind, on track or have achieved your objective. They inform business leaders of the organization’s progress, reaching key goals.
KPIs should contribute to achieving a specific goal or objective. If they don’t, they risk stealing attention, time, and money from KPIs that help achieve objectives. Alignment is key: there must be a direct correlation between the action plans and the objective. Working hard and not seeing expected results is the first sign of a broken link. KPIs without corresponding objectives lose their punching power and become just another number.
SAMP & EAM/CMMS
A SAMP is a big help with the software. Organizations spend millions of dollars on EAM/CMMS services and IoT platforms to improve reliability, minimize costs, and lower risk. However, many EAM/CMMS technology investments are made without a supporting EAM strategy for how the technology will deliver ROI or what objectives the EAM/CMMS investment will help achieve. Nothing firmly connects what the technology will do with what the organization needs it to do.
A SAMP provides direction for EAM/CMMS implementations. It specifies the EAM/CMMS deliverables and ties the technology directly to accomplishing objectives. It becomes an action with a purpose.
In contrast, investments in EAM technologies without a SAMP are action plans without a game plan. A lot of money has the potential to be spent without a clear understanding of how the technology will pay off. The EAM/CMMS implementation highway is littered with underperforming, underutilized systems that lack a game plan for their use and deployment. If no strategy links the EAM/CMMS technology with what the organization wants to accomplish, the technology loses its purpose and focus.
Enterprise Asset Management involves the management of physical assets throughout their lifecycle with the singular purpose of helping the organization realize its goals. Your SAMP is the game plan for making it happen. Without an EAM strategy that includes concrete, quantifiable, measurable goals, you cannot effectively align resources, measure success and demonstrate results, value, and performance.
A SAMP helps ensure that EAM delivers what it is supposed to:
- Increase performance and uptime of the organization’s physical assets
- Extend the useful life of the asset
- Streamline maintenance and MRO supply chain activities
- Minimize operational costs
- Comply with environment, health, and safety (EHS) initiatives
- Enterprise-wide standard processes, KPIs, and data
Ultimately, a SAMP is essential because the resources available to achieve goals are usually limited, and asking for money is always better received when a strategy is in place. A SAMP helps communicate the investment.
The SAMP is your north star to guide EAM value creation, leading the EAM operation toward delivering the organization’s goals. A SAMP is your plan to make sure you don’t end up somewhere else.