A Roadmap to High Performance: ISO 55000 and a Management Systems Approach to Asset Management

Asset Management is About More than Managing Assets

What does it mean to be a high performance organization when it comes to asset management? And what is an asset, anyway? The definition of the term “asset” can be very broad. Indeed, an asset can be considered any resource needed by and available to an organization to accomplish its work. However, physical assets such as real estate, infrastructure, building systems, fleets, specialized equipment and other personal property are what drive most asset management programs.

As for what it means to be a high performance organization, here are six characteristics that all such organizations have in common:

1. Well organized to accomplish their business¹; i.e., roles are clearly understood, responsibilities are aligned with accountability, appropriate communications and coordination takes place across all management “silos” and between all levels of the organization.
2. Aware of risks and opportunities in their business environment and in everything they do.
3. Performance oriented, i.e., they understand how to measure success in the business they’re in and have good systems to do so, business goals are clearly communicated from top management to operational activities, and performance against those goals is clearly communicated from operational levels to top management.
4. Well informed; i.e., have good information about the environment they operate in and on all the important aspects of their business activities.
5. Adequately resourced; businesses that are less than ideally financed and staffed must be good at optimizing their uses of limited resources.
6. Exceptionally good at the business they’re in.

There is no shortage of information, opinion or guidance on how to build a high performance organization, yet high performance organizations remain the exception rather than the rule, and even rarer is the organization that routinely succeeds in all areas. Why is this true? Although the characteristics of high performance organizations are based on common sense principles, it’s difficult for organizations to consistently live those principles on a day-to-day basis. Furthermore, high performance organizations tend to grow with their successes, and growth brings changes to activities and relationships that may not always be consistent with those principles. Sustaining a high performance organization requires consistent leadership and attention to how these characteristics are exhibited in every facet of the organization, including asset management.

Fortunately, there’s a roadmap for becoming a high performance organization and remaining one: the international management systems standard called ISO 55000: Asset Management. It’s based on a systems engineering approach to management standards begun by the International Organization for Standardization (ISO) in the late 1980s. ISO defined a management system as “the way in which an organization manages the inter-related parts of its business in order to achieve its objectives.”² Organizations with effective asset management systems are, by definition, high performance organizations.

The ISO 9000 quality management systems standard was first published in 1987 and has been revised and updated every few years since. ISO 9000 introduced the world to the “management systems standard” and today more than two dozen ISO management systems standards³ have become widely adopted around the world.

Many ISO management systems standards use a uniform structure to define common terminology and identify requirements for what organizations need to do to achieve their goals. ISO 55000 Asset Management addresses what organizations need to do to achieve all their goals; more specifically, what they need to do to make sure they use their resources properly to achieve those goals. This standard supersedes and expands upon the now retired PAS 55 Asset Management standard considered by some one of the most popular standards of all time⁴. PAS 55 focused narrowly on physical assets, but ISO 55000 reflects the full range of asset types – both tangible and intangible – making it the perfect roadmap for high performance organizations in any line of business.

The body of this paper discusses the evolution of ISO 55000 and explores some useful ways to understand and apply the basic concepts in the standard. It discusses who’s using the standard currently and the benefits they’ve realized. If you want to “cut to the chase,” before taking the time to read the entire paper, jump ahead to the section on “Conclusions and Next Steps” starting on page 42.

The authors of this paper hope these ideas will spur you to begin to develop your own roadmap for implementing asset management based on these global best practices. If you get asset management right, you get it all right.

Most of all, just get started. ISO 55000 Asset Management provides a strategic roadmap for becoming a high performance organization, and guides leaders in assessing the maturity of their asset management systems and sustaining their high performance organizations. Whether you start big, or start small, ISO 55000 will guide your way.

Jack Kelly and Michael Hardy
April 2018

¹ Note: we use the term “business” to include the activities involved in accomplishing the organization’s mission, whether or not they are for-profit business activities.

² What is a Management System? (www.iso.org/management-system-standards.html)

³ ISO Management Systems Standards List; (www.iso.org/management-system-standards-list.html)

⁴ISO 55001 Asset Management supersedes PAS 55 (www.bsigroup.com/en-GB/Asset-Management)