Publication type: Conference other
Type of review: Not specified
Title: From maintenance management to asset management : shifting the view from functional behavior of assets to value creation with assets
Authors : Heitz, Christoph
Kleger, Sabina
Sigrist, Jörg
Conference details: The 2nd World Maintenance Forum, Lugano, 4-6 September 2013
Issue Date: 2013
Language : English
Subjects : Asset management; Equimarginal principle; Budget allocation
Subject (DDC) : 658.5: Production management
Abstract: In recent years, the concept of (physical) asset management has attracted much attention. More and more companies use this term for denoting strategic aspects of dealing with physical assets. However, the methodological foundations for asset management are far less developed than those for maintenance management, and it is often not clear on which premises asset management should be built, and how these premises should be turned into practical managerial concepts. We present a conceptual model that defines asset management as the management of value creation by means of physical assets. It includes maintenance management as an important part, but is based not on functional concepts such as reliability, availability, or the like. Instead, it builds on concepts that explain how assets create value for the company using them as part of their operations, in the context of the specific business model, the stakeholder environment, and the market in general. The model can be used for private firms focusing on profit maximization, but can also be applied to the case public entities such as cities where the created value often cannot be measured by monetary units. Using our model, it turns out that the basic problem of asset management is a budget allocation problem. We derive a general formulation of the allocation problem and show how it can be solved, using the established economic principle of equal marginal utility. We show that, in a first step, this principle can be used for deciding how much a firm should spent on physical assets vs. other resources. In a second step, the same principle can be used for solving the allocation problem among the different physical assets. The application of the equimarginal principle ensures that, for every level of total investment in the resources of the firm, this investment is used in an optimal way. It turns out that the solutions obtained with our approach are quite different to the solutions obtained when applying classical maintenance methods. It also turns out that classical methods yield suboptimal answers, and generally lead to policies and operations that create less value.
Fulltext version : Published version
License (according to publishing contract) : Licence according to publishing contract
Departement: School of Engineering
Organisational Unit: Institute of Data Analysis and Process Design (IDP)
Appears in Collections:Publikationen School of Engineering

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