Question

Analyzing and mitigating physical asset risk in a global trade

This question is from global trade assessment course

Answer 1

Throughout the asset life cycle operating process there might be a question with both sustaining and retaining over. Usually, the biggest problem around preserving includes two problems that can ineffectualize the asset management system. Secondly, the implementation of non-value - added services typically entails a substantial expense. Cost can be loosely used as a guideline in this regard, since there are well-documented industry benchmarks that can be followed for maintenance expenses. Second, the typical organization that can be accused of over-maintaining its assets will most likely perform more frequent intrusive maintenance tasks

The fundamental tenet of best practices asset management requires the implementation of a strategy that not only manages the operation and maintenance of the assets of an entity but also handles the risks associated with ownership and use of the assets. Risk is a function of consequences in its most elementary form, and the likelihood of such an event occurring. There are two key fronts of risk management: 1) evaluation or identification; and 2) monitoring and controls. That field is a continuing contributor to inadequate asset management when not performed well. One need not stretch one's imagination too far to understand this concept.

Enterprise Asset Management (EAM) systems have become more common within organizations for the management of assets in recent years. Many programs have inherent limitations that hinder comprehensive management of all of the plan's necessary areas. As a result, it often takes additional secondary systems. This being said, many companies are guilty of not completely leveraging the functionality that are available from most EAMs. It is usually attributable to shortcuts taken during implementation of the EAM. The way to address this issue fully is either to do it right the first time, or to pay more later

As part of the mechanisms (EAM, secondary systems) and strategic approaches, we sometimes fail to understand that our human resources and business processes are essential components of the asset management framework of the organisation. A lack of due diligence in these fields would also have an detrimental impact on the bottom line and should also be prepared for.

Asset management is an integrated approach to optimizing your assets' life cycle from conceptual design to use, decommissioning and disposal. By recognizing and paying attention to these five primary risks to effective asset management, you can put in place plans to mitigate the possible effects on your program. Note also, that true excellence in the performance of asset management lies not only in avoiding the pitfalls, but in turning each and every one of these opportunities into a chance to excel.