Asset management has always been about more than simply managing assets. There is a strategic dimension to the discipline. It is this intrinsic connection to the bigger corporate picture, though, that means as the wider business world changes, so must asset management evolve too.
Digital transformation has significantly elevated the importance of asset management
The Times in the UK produced a special Racontuer report in May, 2017. Some key takeaways from the article included:
1. Think beyond risk in decision-making
Think beyond risk and about delivering value in asset management, which is what is defined in ISO 55000. Clearly understand what constitutes value for each organisation and your stakeholders, including money, reputation, safety, sustainability and well-being.
2. Focus on physical and non-physical assets
Asset management is expanding into non-physical assets, which in many cases can be valued significantly higher than physical assets. For businesses managing asset optimisation of ageing infrastructure, alongside demands of corporate social responsibility and sustainability regulation, the approach to intangibles is the same, you need to contextualise and quantify the risk.
3. Assess the external factors
Environmental, social and governance (ESG) criteria used to assess risk and opportunities also need to be considered.
4. Get C-suite buy-in
Boards are often focused on short term – rather than the total cost of ownership and maximising shareholder value in the long-term. This means it’s important for maintenance departments for example to demonstrate increased risks and costs that result in the future from underinvestement.
If the modern asset manager has algorithm-based analytics and data-driven intelligence, it will provide much-needed muscle in being heard by the C-suite.