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WHITEPAPER: ASSET MANAGEMENT AND MAINTENANCE

Australia's productivity problem As experts continue to predict the slowdown of Australia's mining boom, many businesses are examining the potential of productivity improvements to ensure they remain competitive in economically challenging times. This is true across a number of different industries and sectors, as enterprises realise they must position themselves to fill the gaps made available when resources profits and projects plateau. A recent report by Ernst & Young revealed that productivity is increasingly finding its way back into the economic vernacular of Australian companies, with estimates putting annual salary wastage at $109 billion. In other words, businesses are collectively spending over $100 billion a year on wages because their employees are wasting time on unnecessary and laborious processes. One of the primary ways in which many sectors are tackling this productivity issue is through tightening their asset management and maintenance procedures to drive efficiency, cut costs and create greater visibility.

Benefits of effective asset management and maintenance

Optimal asset management and maintenance involves maximising the service delivery potential of assets across their entire lifecycle, including planning, organising and controlling their acquisition, refurbishment and disposal.

Adrian Stephen, managing director of Logistics Pty Ltd, has over 40 years' experience in the asset management industry and says the advantages can be significant. "Effective asset management facilitates proper organisation, ensures a focus on continuous improvement and the appropriate use of tools and methods," he says. "It also provides a better understanding of the work that needs to be done, the accuracy of performance metrics and raises business performance." Enhanced productivity is an overarching outcome of good asset management, but this includes a variety of other positives, such as health and safety compliance, greater teamwork efforts and better environmental credentials. Well-documented cases of poor asset management include the decommissioning of the Royal Australian Navy landing platform vessels HMAS Manoora and Kanimbla in 2011, which were retired early after several performance issues. The Department of Defence's damning Rizzo report highlighted a number of problems with the ships, including maintenance delays, the loss of technical skills to industry and an inability to manage aging assets. Organisations with the right tools, training and asset management approach can instead maximise their investments in assets by ensuring longevity where required, optimising procurement practices and improving decision-making.

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Asset management and maintenance challenges Improving asset management is possible across all sectors, although asset-heavy sectors such as oil and gas, energy, transport and engineering, among others, are the most likely to see the biggest gains. However, the effective implementation of initiatives to boost asset management and maintenance functions can face challenges in today's modern business environment.

Departmental silos A lack of communication between departments can have a severe negative impact on asset management and maintenance, with a silo mentality preventing businesses from taking full advantage of the knowledge and resources at their disposal. With little alignment between accounting and business departments, and engineering and maintenance teams, this creates a discord that becomes a considerable problem for asset managers. Adrian says organisations need to better integrate the multitude of departments that are involved in asset management. "A proper asset management structure involves economics, accounting, business decisions, engineers, fitters, store men, cost accountants, procurement offices and more," he explains. "Cross-discipline awareness is what is required. You need to develop the ability to make complex decisions in situations of uncertainty."

Rise in technology Ernst & Young's Australian Productivity Pulse highlighted that technology has proved a boon for many organisations looking to optimise their processes. Nearly two-thirds of employees polled in the survey claimed new, improved or additional technology would boost productivity in their workplace. Enterprise resource planning systems and computerised maintenance management systems can offer better access to data for decision-making, improved planning and increased visibility across a business's operations. However, this massive investment in technology also comes with challenges for asset managers, including an unwieldy amount of data, a lack of appropriate skills and inflexible software that dictates business processes.

Fluctuating role of asset managers The asset manager's role has changed drastically over the last decade, particularly with the growth in technology systems designed to make life easier. Despite this, organisations are failing to invest in the training needed to prepare their personnel to meet these new requirements and understand how asset management fundamentals and maintenance fit into the evolving business landscape.

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Adrian says that this is resulting in more engineers taking part in postgraduate courses in economics, accountancy and business to get to grips with how their duties fit in with the overall commercial aims of organisations. "Even when they're not doing formal training, they're still attempting to expand their horizons because they're told you have to understand the budgets of the business," he adds.

Asset management and maintenance training Enrolling on training courses can help individuals improve their knowledge of core asset management and maintenance fundamentals, which can be learned and implemented back at the workplace. Adrian says the proper alignment of asset management with wider business aims is becoming more and more common in today's commercial environment. "In the competitive market we are in, there's more focus on business excellence than maintenance excellence," he explains. "You've got to bring your maintenance excellence up to a standard to achieve the business excellence that is expected of you." Asset management and maintenance training covers vital industry subjects, including statistical methods, whole of life assessments, aged equipment management, change management and failure assessment. These topics and many others are explored in an adult learning environment that utilises teaching methods such as collaboration, case studies and peer-to-peer learning. Suitable for applicants across all backgrounds, courses are tailored to account for different industries and sectors, encouraging a wider understanding of asset management issues. "Training is a confirmation of the skills and knowledge you already have, as well as making you aware of the things that you should be doing," Adrian says. For more information on asset management and maintenance training, as well as related conferences please contact Informa Australia or visit the website here.