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Understanding the Difference Between Managing Assets Versus Asset Management

Managing Assets vs. Asset Management: The Importance of Vocabulary

October 20, 2022
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“All our work, our whole life is a matter of semantics, because words are the tools with which we work . . . everything depends on our understanding of them.” When legendary Supreme Court Justice Felix Frankfurter first said these words, he wasn’t applying them to the laboratory, but he may as well have been.

Just as semantics plays a key role in understanding and interpreting the law, this type of specificity is paramount to advancing performance and promoting productivity in scientific laboratories.

While all laboratories have assets that need to be managed, not all labs have asset management programs in place—and therein lies the rub. While this may sound like an unassuming difference in phrase, these are two very different methodologies, both strategically and practically.

Understanding the differences in these meanings is crucial to anyone in a laboratory setting. Several key attributes and trends differentiate managing assets and asset management in a lab setting, and the variance between the two can get in the way of optimization and progress.

The Definition of Managing Assets

Simply put, managing assets are things an operator does to assets. This methodology tends to be more reactive to the changing needs of instruments, equipment, and budgets. Typically, managing assets means tending to the immediate needs of an asset. These are done to steer the activity without a focused and defined strategy beyond keeping the various functions across the lab operational. Managing assets includes actions such as fixing broken instruments, maintaining current methods and functions, and tracking asset location and conditions.

The activity that occurs around assets often results from immediate needs, not long-term, cross-departmental objectives and resources.

The Definition of Asset Management

Asset management has a broader purpose and focus than just managing assets, encompassing many organizational levels and applying to all functions or departments. The terms and concepts are explained in ISO 55000 ‘Asset Management’, which shows how the application of broader asset management approaches provides the most value for stakeholders.

In the last few decades, asset management as a discipline has won broad acceptance, and it’s now considered critical to the development of capabilities, growth, and long-term success of laboratories, whether standalone or part of a global network. Here are a few points to consider when determining whether an activity is asset management – or simply managing assets.

Managing Assets

Managing assets is short-term in nature. This approach primarily concerns immediate needs, transactional information, and ensuring key performance indicators (KPIs) are met.

  • Lifecycle activities and asset care: availability, reliability, dependability, and safety
  • Asset location, condition, life extension, and/or interventions
  • Asset databases, systems (and IT), and performance
  • Training, skills, and work management
  • Budgets and KPIs/cost of maintenance and current performance

Asset Management

Asset management is also concerned with larger purposes and vision and the long-term strategies that serve the organization.

  • The purpose of your organization and what assets it needs – and why
  • Value, purpose, and long-term outcomes
  • Risk and context, including markets and regulatory climate
  • Holistic approaches to different funding streams, such as CAPEX and OPEX
  • Collaborative behaviors: breaking down silos, both internal and external
  • How assets contribute to organizational value

How to Determine Which Approach Is Right for Planning

The table below organizes how different areas of a laboratory’s ecosystem commonly focus their energy and attention on both methodologies. Reviewing each one side by side can be a helpful exercise to identify your current status and compare it to a future state:

 

Managing AssetsAsset Management
Your colleagues are focused on:

  • Asset data, location, and condition assessment
  • Current KPIs
  • Department budget
 

Your colleagues are focused on:

  • Information-supported decisions (strategic context and related to customer needs)
  • Strategies to select and exploit assets over their lifecycles to support business aims
  • Collaboration across departments to optimize resources allocated and activities
 

Your stakeholders are focused on:

  • Costs
  • Current performance
  • Response to failures/maintaining function
 

Your stakeholders are focused on:

  • Triple bottom line and value
  • Clarity of purpose of the organization
  • Focus on impact of activities on the organization’s objectives
 

Your top management is focused on:

  • Short term gain/loss
  • Departmental/individual performance
  • Savings, especially OPEX
 

Your top management is focused on:

  • Long-term value for the organization
  • Developing competence and capability across the workforce
  • Business risks understood and mitigated
 

Your suppliers are focused on:

  • Short-term contracts and performance
  • Service-level agreements focused on contract specifications
 

Your suppliers are focused on:

  • Long-term contracts and/or partnering relationships in support of client value and objectives
  • Understanding client strategy and needs in 5 to 10 years

Best Practices: Creating Space for Growth

As technologies and instrumentation continue to evolve and develop, so too must the strategies that support and manage them. The right organizational structure can make all the difference when it comes to optimizing processes and the use of assets.

While there isn’t a one-size-fits-all approach to ensure laboratories are functioning at their highest level, best practices can help support workflows and scientists. Those looking for a holistic approach to equipment maintenance services and management across all equipment brands may want to consider implementing an asset management program.

OneSource Asset Management Services are designed to take personnel and lab efficiencies to new levels. This program offers a single point of contact and custom service plans built on Six Sigma and Lean Best Practices.

How ISO 55000/55001/55002 Can Help

The International Standards Organization (ISO) provides an overview of asset management, its principles and terminology, and the expected benefits of adopting asset management.

The standards provide common concepts, language, and requirements for asset management and the supporting asset management system. In doing so, they address both the activities performed directly on the assets (“managing assets”) and the strategies and plans of the organization to derive value from those assets (“asset management”).

Click the link below to see the Frequently Asked Questions for Asset Management.

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