Changing data needs from a life cycle perspective in the context of ISO 55000

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1 Changing data needs from a life cycle perspective in the context of ISO Mr. Ed de Vroedt and Mr. Peter Hoving Affiliation: UMS Group Europe; [email protected], ABSTRACT This paper presents the implications of an asset management methodology like ISO55000 on information needs of a distribution company during several stages of its assets life cycles. Questions that will be answered include how a typical asset life cycle looks like, which data elements are required to execute an effective asset management strategy during each asset life cycle stage. Index Terms PAS 55, ISO 55000, Life Cycle Management, Distribution networks, Information Management, Data Architecture 1.0 INTRODUCTION TO ASSET MANAGEMENT METHODOLOGIES (PAS55 / ISO55000) I n industries where the performance of physical assets is critical for achieving or exceeding the corporate goals, excellence in asset management is crucial. There is some confusion about the term Asset Management. The meaning depends on the sector in which the term is used. In the industrial capital intensive sectors, Asset Management is associated with the management of physical assets throughout their whole asset life cycle. Due to recently intensified pressure from regulators, customers and other stakeholders following the economic crisis, companies are almost forced to apply effective riskbased asset management. Successful businesses understand that the optimized management of their assets is vital to operational performance and profitability. Many of them have embraced PAS 55 or ISO as their guiding principle for implementing, maintaining and improving an effective asset management system. In the IAM (Institute of Asset Management) developed PAS 55 (together with British Standards Institution (BSI)), the first publicly available specification for optimized management of physical assets. After the 2008 update (PAS 55:2008), the International Standards Organisation (ISO) accepted PAS 55 as the basis for development of the new ISO series of international standards which were published January Both standards are meant to coordinate an organization s activities to realize value from its assets. Key themes include: alignment ( line of sight ) of organizational objectives feeding clearly into asset management strategies, objectives, plans and day-to-day activities; whole life cycle asset management planning and crossdisciplinary collaboration to achieve the best value combined outcome; risk management and risk-based decision-making; the enablers for integration and sustainability; particularly leadership, consultation, communication, competency development and information management. The changes and new elements in the ISO standards, compared to PAS 55, are: generalized and broader scope and terminology; explicit attention to understanding stakeholders needs and increased focus on leadership; reliance is made on the line of sight in decision making by focusing on clear and documented methods for defining value and balancing conflicting business objectives; organizational strategic objectives, asset management policy and asset management strategy are split out into discrete requirements and the strategy term is dropped in favor of Strategic Asset Management Plan (SAMP); risk management requirements are described less detailed. Reference is made to ISO which offers a special risk management standard; the requirements for audits and documentation have been tightened. The focal point of ISO is on the alignment of strategic objectives (representing stakeholders needs), risks and the SAMPs towards executing the work orders in the field, during the entire asset life cycle. 2.0 TYPICAL ASSET LIFE CYCLE Life cycle management and Total Cost of Ownership (TCO) are widely used concepts throughout the distribution industry to manage the asset base sustainably. More and more companies, make these considerations within an asset management framework like PAS 55 or ISO The explicit identification of different life cycle activities Page 1 of 7

2 has been dropped in ISO (to accommodate more diverse life cycle stages of different asset types). But a typical life cycle of a (physical) distribution asset will still come through the following stages as described in the PAS 55 requirements: acquire / create; utilize; maintain; renew / dispose. Furthermore, the PAS 55 mentions that the life cycle activities should be described in processes and procedures and that these should be implemented and maintained like all other processes of the asset management system. It is also required that the documentation to control the life cycle activities are in line with all the other documentation. During the first life cycle stage of acquiring / creating an asset, normally the asset condition is excellent as it was just produced by a vendor and installed meeting all technical and functional specifications. The corresponding asset risk level for a distribution company is low during this phase, because most risks fall under the vendor s guarantee (for a limited time). When an asset is in its utilization phase, the asset condition will gradually deteriorate while the asset risk level increases slightly, up to the moment that maintenance is required. As the vendor s guarantee expires, a distribution company needs to build more knowledge on the asset itself, to be able to maintain the asset properly and to keep the asset condition on the desired level. During the maintenance phase, the asset risk level will rise. As the gap between an asset s health condition and risk level declines, the information need increases up to the point where the asset s risk becomes higher than the asset s condition. This point generally marks the starting point of the last life cycle stage: renewal or disposal of the asset. Conceptually, a typical life cycle can by represented as in figure 1. Fig. 1: Development of asset health condition, asset risk level and asset information need through an asset s life cycle. 3.0 AM IT ARCHITECTURE: UTILITY REFERENCE MODEL A general objective of Asset Management is to maintain control over the information flows that inform understanding of assets, their whole life cycle costs and risks throughout their life cycle. The ability to make sound asset decisions is dependent on having the right information. Information and with that data is a critical enabler for Asset Management. It is the lifeblood of Asset Management. A best practice data and IT architecture operates with one master asset database from which all other applications have access to data subsets. In practice, multiple systems exist because asset management IT systems provide very different functionality with different (data) views of the asset, like geographic information systems (GIS), performance management systems and industrial control systems (ICS) like SCADA. For example, these systems may interface directly with assets for monitoring and control, bring information from remote assets in the company and describe the spatial aspects of the assets. There is a high dependency between asset operation, maintenance and equipment reliability for the most profitable lifetime performance of assets. Fig 2: Application Service Areas of IT Architecture. Using the information in the asset register requires an integrated suite of tools and applications to allow the required manipulation of static and dynamic asset information, as shown in figure 2. Page 2 of 7

3 Ultimately, data flows are going to be best mastered throughout the life cycle of the asset using integrated and connected IT Systems with clear stewardship of asset data. Beyond identifying data gaps that constrain the ability to build complete and effective Strategic Asset Management Plans (SAMP), it will be important to define the data needs to support other AM functions, like: asset risk / failure forecasting; estimating project costs / duration; supporting specific repair / replacement / refurbishment decisions; investment portfolio optimization. Fig 3: Schematic of data capture and management within best practice asset management 3.1 LOGICAL DATA ARCHITECTURE ASSET MANAGEMENT Through engagement with many distribution utilities over the world and based on the above stated principles of data management, UMS Group built a logical data architecture as foundation for implementation of data management to support effective asset decision making within utilities. This data model covers all relevant entities, attributes and their relationships and follows the asset management processes Risk Management, Solution / Investment Planning, Portfolio Optimization, Portfolio / Investment Delivery Management. This logical data architecture groups the required data sets to support the asset management processes into nine data classes, as shown in figure 4. The logical data model will be used as basis for the design and development of asset management information for each life cycle stage. This approach should optimize understanding of the involved assets and their whole life costs and risks. Importantly, it should not compromise the individual objectives of each lifecycle stage. 4.0 EVOLVING INFORMATION AND APPLICATION NEEDS DURING ASSET LIFE CYCLE Each life cycle stage has its own characteristics and different activities to be executed to achieve optimal performance in that life cycle stage. In the early use of an asset, the strategy could be to apply preventive maintenance and to follow the recommendations of the supplier. But when deterioration kicks in over time, the maintenance strategy will change towards condition based management. Within this life cycle approach, utilities need for data and applications (for the manipulation of asset data into information) will follow a similar development path to support each asset life cycle strategy. The information and functionality need will grow when assets deteriorate and move to end of life stages (red line in figure 1). In the next sections, the development of asset data and applications will be explained from a typical life cycle perspective. 4.1 ACQUIRE: STATIC DATA In this stage, no historic performance data is available and the focus is on collecting initial static data of the asset from the supplier of the components. Only publicly available performance data from other users could be used as reference. Data needs are focused on asset master data. This class contains the static information about the assets such as: Asset identification Asset class Equipment components Engineering data Asset location Fig. 4: Logical Data Architecture Asset Management Page 3 of 7

4 Asset outage statistics Asset defect statistics Asset fault statistics Utilisation / loads statistics Targets and measures Fig. 5: Typical static data components Functionality is concentrated around applications to store the static asset data like asset location information (GIS), asset data portal (asset register) and standards and knowledge management (like document management). Fig. 6: Typical functionality during acquiring phase A typical ICT topic for companies in this stage is related to how and where to register and store the static asset data. Best practice data model and IT architecture operates with one master asset database from which all other applications have access to data sets. Relevant questions in this stage are: Do we use a GIS application to store the asset location and component data? Or do we use an ERP application like SAP to store financial, component as well as location data? These are crucial questions in establishing the optimal asset management IT architecture. 4.2 UTILIZE: PERFORMANCE DATA The asset is commissioned and in its early use. During this stage, the asset is still new and no significant deterioration is yet expected in this stage of use. However asset performance and condition data should be built to assess and adjust the maintenance strategy if appropriate. Data needs are focused on asset condition, asset performance and asset master data. These classes contain dynamic information about the current condition of the assets and operational performance of the network in terms of utilisation, throughput and defects. Data elements to be considered are: In-service records Condition survey Maintenance history Fig. 7: Typical performance data components Functionality in this stage is focused to support asset decisions to assess the performance of the assets like equipment failure analysis and modelling, RCM/CBM analysis, capacity planning, load forecasting, performance analysis, asset health index, outage cost analysis and planning, asset criticality and condition assessment. Fig. 8: Typical functionality during utilization phase The ICT topic in this stage is about combining performance and condition asset data towards information that can be used for asset decisions like maintenance frequencies and criticality analysis. During this stage asset condition and performance data is built up, most likely in a proliferation of different applications. The asset management business requires an integrated suite of tools and applications to allow the required manipulation of static and dynamic asset information. Typical questions are related to data integration issues like interface services via middleware solutions or single database data integration. 4.3 MAINTAIN/RENEW: RISK DATA The asset is now in its midlife to end stage. In this stage information is needed to maintain the performance of the assets while risks of failure are increasing. This risk perspective needs to be integrated in the asset life cycle strategies and additional data is needed to assess failures and risks to develop mitigating solutions. Page 4 of 7

5 Data needs are focused on the asset class Support: miscellaneous data needed for sound and defendable decision making like regulatory requirements and risk documentation but also safety, benchmark data, customer interruption and status (time, expenditure, quality) of work in relation to targeted risk reduction. analysis functionality needs should be developed to support this last stage of the asset life cycle. Fig. 11: Development of data needs during an asset s life cycle Fig. 9: Typical risk data components In this stage, additional functionality is needed to support risk based asset decisions, i.e. reliability and risk modelling (which enables tasks such as FMEA, root cause analysis or contingency planning), evaluation of economic risk, the risk register and the system risk profile and portfolio optimization. 5.0 DETERMINING ASSET LIFE CYCLE STRATEGIES IN THE LIGHT OF ISO In figure 12, an overview of the risk based asset management system is given. Fig. 10: Typical functionality during maintenance / renewal phase Next to storing additional risk related data, the typical ICT topic in this stage is related to create more information with the existing data. In this stage extra functionality in the risk area is integrated. The amount of internal and external data that can be used for asset analysis is also growing fast. Data interpretation issues to connect a wide range of data and find correlations for better asset decisions (data analytics) is one of the most important topics in which IT departments can support the AM business today. 4.4 CONCLUSION Asset information and functionality needs follow a similar path along the lines of the asset life cycle. During its life cycle, data is collected and analyzed to maintain the desired asset performance. Major failures cause life cycle strategies to be reviewed and driven by external pressure companies should add a risk perspective to asset decision making. Asset performance and condition is not enough anymore to make robust asset decisions. Risk data and risk Fig. 12: Asset management system As mentioned before, ISO prescribes companies to have so-called Strategic Asset Management Plans (SAMPs). In the SAMPs, there should be a connection between asset strategy and risk. However, it depends on the life cycle stage to what degree these risks could / should be integrated in these SAMPs. 5.1 LIFE CYCLE STRATEGY FOR ACQUIRE In this early stage of development, only static information from the supplier is available. No performance information is available yet, nor has the condition of assets been analyzed by the utility. Page 5 of 7

6 Fig. 13: Classic asset management top down approach During this stage, no asset strategy is yet required though policy statements should be set up for the criteria for acquiring assets within a whole life cycle approach. The asset life cycle policy statement in the acquire stage could be as follows: During the acquiring of new assets we will always apply an evaluation method of the price which is based on Total Cost of Ownership evaluation. Meaning that not only the price for acquiring the asset will be taken into consideration, but also the expected utilization and maintenance cost over the life time of the asset and the cost for disposal. The Total Cost of Ownership criteria will be applied in our purchasing policy and strategy. 5.2 LIFE CYCLE STRATEGY FOR UTILIZE In the second stage of the development, initiated by major incidents, we often see that the asset life cycle strategies are reviewed and the need arises to re-built the strategies based on asset condition and performance and that the overall asset strategy is connected to an overall asset health measure. The asset life cycle policy statement for the utilization stage could be as follows: Childhood stage: During this stage the asset is brand new. It still falls under the guarantee of the vendor. Childhood issues can be expected. The maintenance strategy is fail and fix. All unexpected expenses will be claimed under guarantee to our vendor. Early use: The asset will still be in good condition. No traces of deterioration are expected in this stage of use. The maintenance strategy is to apply preventive maintenance and follow the recommendation of the supplier. Further information to analyze and reconsider preventive maintenance intervals is collected. 5.3 LIFE CYCLE STRATEGY FOR MAINTAIN / RENEW In the third / fourth stage it is expected to find companies that are strongly driven by external pressure. These companies have to operate within tight constraints (e.g. budget). To comply with all constraints, a risk perspective needs to be integrated in the existing asset life cycle strategies and asset decision making process. The external audits from e.g. regulators are focused on the link between risk, asset life cycle management and asset performance. Fig. 14: Integrating asset health in asset decision making During the utilization / early life stage, a supplier driven asset strategy is applied. It is the moment that companies start building knowledge on asset performance and condition. Fig. 15: Integrating Risks into asset decision making Page 6 of 7

7 During the Maintain/Renew stage a risk based asset strategy is applied. This could be a preventive, condition based or corrective maintenance strategy. The asset life cycle policy statement in this stage could be as follows: Mid use: The asset will be starting to deteriorate due to use over many years. More failures can be expected. Based on analysis of asset performance, condition and failures the strategy will be adjusted from preventive maintenance to more closely monitoring condition and taking immediate action when needed. End stage: The asset is close to end of life. The strategy will be run to failure. At any moment of failure, evaluation of the failure will determine whether repair or replace is the best option. Fig. 16: Evolving asset strategies during an asset s life cycle. Over the life time of assets the asset strategy will change to fit the constraints in which the company operates. From an ISO viewpoint an additional requirement kicks in: the asset strategies should link risks, asset life cycle management and asset performance. These elements should be integrated into the SAMP s to comply with the ISO requirements. approach is needed to balance all external and internal pressures to achieve the desired asset performance. This is in line with the ISO requirements that prescribe that the decision-making criteria to be used, e.g. asset management decisions are to be based on evaluations of alternatives that take into account life cycle costs, benefits and risks of the asset. The need for business-support applications for multidimensional (engineering, economic, regulatory, risk, etc.) analysis to translate data into information to make sound asset decisions, follows the same development path of the asset life. More complex analysis functionality is needed over the life time of the asset. The focus will then turn from data collection to data analytics, to connect the ever growing amount of asset related data into information. 7.0 REFERENCES ISO series, Asset management, BS ISO 55000:2014, BS ISO 55001:2014 and BS ISO 55002:2014 BSI (2014) Moving from PAS55 to ISO55001; The new international standard for asset management 6.0 CONCLUSIONS Life cycle strategies need to be synchronized with the asset life stage of the asset. The life cycle stage determines the applied asset strategy; from a strategy based on supplier recommendations in the early life stage to a risk based approach in the end of life stage. Fig. 17: Development of data and analytics in DSOs over time The complexity of asset decisions increases along the lines of the life cycle stages. More and more data is needed to cope with a growing number of stakeholder requirements that need to be balanced. At first, asset performance and condition data is sufficient to make robust asset decisions. Eventually a risk based Page 7 of 7