Manage your assets: Organize them with a governance model

Delivering required service levels. PHOTO: zapp2photo – stock.adobe.com

Getting the most out of plant assets requires an organized approach, hence the importance of a governance model.

Roopchan Lutchman, an engineer and author of three books on the subject shared his expertise during a presentation of at a MainTrain conference hosted by the Plant Maintenance and Engineering Association of Canada.

He’s practice group lead for business consulting at GHD Pty. Ltd.’s advisory division, which provides engineering, consulting and management advice across five continents.

He said that the structural configuration of an organizational design is the way work is divided, and how it achieves coordination among its various work activities around the life cycle of plant assets.

Asset management’s (AM’s) goal is to ensure team members are always working on the right activities, at the right time, for the right reason, and for the right cost.

The governance models he described ensure there’s effective collaboration and coordination to make this happen around all business processes.

The most successful and effective models share many of the same design principles, which include:

• strategic vision;

• mission and values;

• reallocation and balance of human resources and workload;

• leveraging the existing skill and expertise areas of management and staff;

• adherence to collective agreements;

• attracting and retaining the right people/skills; and

• providing for performance measurement of AM program delivery.

He noted the ISO Asset Management Standard (55000, 55001 and 55002) provides guidance. There are four models:

1. Corporate asset management steering team, centralized AM group, departmental delivery through networks.
2. Corporate AM steering team, decentralized departmental delivery.
3. Corporate AM group, internal decentralized departmental delivery.
4. Corporate AM steering team, delivery through task teams.

Making it work

He said many plants have adopted Model 1, but some have adopted other models, finding unique ways to manage potential disadvantages.

Here is his suggested implementation methodology:

• Charter the governance model steering team.
• Develop the governance design.
• Get executive approval.
• Implement the communications, leading change and the knowledge management plans.
• Continue asset management development.
• Track and report on program benefits.

Lutchman warned asset management programs have the potential to cause significant disruption as new strategies, practices, technologies and roles/responsibilities are introduced.

But they also lead to the desired program benefits, integration of the new ways of working, and they set the stage for continuous improvement.

This synopsis was written by Steve Gahbauer, an engineer and a retired Toronto-based business writer, who passed away May 15, 2020.

This article first appeared in the July-August 2020 print edition of PLANT.