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    Asset Management Update—ISO 55000 and Its Links with Operational Excellence #15 OE Newsletter

    Did you know that October celebrations include not only Columbus Day and Halloween, but also World Standards Day? Officially it’s October 14, but it was observed on October 23 in the U.S this year. And a new set of standards is being celebrated for the first time—the ISO 55000 Asset Management series. Released in January 2014, these new international standards are provoking questions and requests for information. What is it? Do I need to care? Should we consider compliance or certification? Will this have any bearing on our approach to maintenance?

    If you manage assets or their maintenance, you need answers. Here is a quick briefing. For information on other resources coming soon, see the box below this article.

    What is ISO 55000?

    In a nutshell, the ISO 55000 standards are geared “to help companies and organizations get value from their assets.” They are primarily intended for physical asset management, but can also be applied to any assets, “from railway sleepers to brand reputation to telecommunications networks.”

    According to the standards, asset management “translates the organization’s objectives into asset-related decisions, plans, and activities, using a riskbased approach.” You can think of it in terms of three nested elements, as the standards depict, all of which are a subset of the organization’s overall management approach:

    • At the top level, asset management is your organization’s coordinated activity to realize value from assets;
    • Below that, your asset management system sets the policies, objectives, and processes for asset management;
    • Below that, your asset portfolio defines the assets that are within scope of your system.

    A fuller working definition of an asset management system is the management processes that ensure physical assets will deliver the capabilities needed to generate value for stakeholders during their entire planned work life, in alignment with strategic objectives and plans.

    The top-level policies are set by management based on plans and objectives and taking into account the needs of outside stakeholders. Working from those policies and objectives, a strategic asset management plan is set up to frame the global approach to asset management. Individual asset management plans then follow, spelling out the specifics for different types of assets.

    The ISO approach to asset management

    “ISO 55000 looks at assets with a holistic point of view, from inception to disposal,” said Kris Goly, technical services manager for Siemens Industry Lifecycle Services and a U.S. representative on the standards development committee. “It’s asking the asset owners to have a process in place … that will measure and manage the assets in an effective way and make sure the assets bring value to the company.”

    The strategic asset management plan must address asset flexibility as to customer needs, value capability for stakeholders, and reliability/maintainability throughout the life cycle. Four key principles drive the system: value creation, leadership, alignment (from vision to operations), and assurance of capability. It’s all about ability to create value, not the assets themselves.

    Certainly a tall order, but here’s the good news: when tied with top-level strategies, lean and TPM provide best practices for deploying the necessary management and operational processes.

    The link with lean and total productive maintenance (TPM)

    The further you unpack the ISO 55000 requirements, the more connections you see. From autonomous maintenance to early equipment management, the eight pillars of TPM encompass a comprehensive, proactive approach for managing and maintaining physical assets to contribute maximum value over their life cycle.

    Mike Kuta, senior partner with Productivity Inc., roughly characterizes TPM as “the ‘how to’ of ISO 55001.” He said, “The standard requires a company to have a documented Asset Management System. It’s here where TPM can play a major role. TPM is basically a Strategic Asset Management Plan.”

    Likewise, value stream management connects your processes and assets to the customer’s perspective on value creation. Lean designs, jidoka, quick changeover, cross-training, and other lean methods provide flexibility and reliability. Hoshin kanri (policy deployment), leader standard work, and visual performance management are the overall leadership and execution processes. And employee development based on education and teamwork in a culture of daily problem solving drives the process to the grassroots, where everyone brings their fullest potential to the creation of value.

    Should we consider ISO 55000 certification now?

    It depends on many factors, but in short, compliance is likely more important than certification for most companies right now. “I would encourage every asset-intensive company to implement ISO 55000 processes, but I don’t think that you have to have certification,” says Siemens’ Goly. “I would say that certification is the icing on the cake, but from my perspective the most important thing is to implement ISO 55000-based processes and follow them.”

    There are many unarguable reasons to ensure your asset management system is state of the art. It helps you manage cost flows and their variations over the working life of assets. It helps you mitigate an array of risks: strategic, compliance, safety and environmental, and operational risks, including

    breakdowns and process failures, security threats, and obsolescence. But it also helps you grasp the flow of value opportunities—to realize value for shareholders, stakeholders, customers, society.

    With fast-moving global markets, diversified audiences, rapid spread of information through social media networks, disruptions in distribution channels, and easy spread of know-how, we need to not only maintain assets, but manage them for high-responsiveness. We call it Total Asset Management, and connecting lean and TPM initiatives with high-level strategies provides the means.


    The need for new approaches to asset management has gathered momentum. The ISO 55000 series is all about establishing a state-of-the-art asset management system. Whether you are considering certification, or want to get in sync with current thinking, it’s to your advantage to find out more. The good news is that the more you know about lean and TPM, the better positioned you are to connect the dots with ISO 55000 and a strategic-level approach to asset management. And the more you know about ISO 55000, the better you can leverage your current operational excellence initiatives.

    Ask the Consultants

    Q. We are trying to apply OEE across an entire plant. Can you provide some best practices for using OEE correctly?

    A. OEE, or overall equipment effectiveness, is the core measure of total productive maintenance (TPM). Because it packs a lot of information into one number, it’s powerful. But that can also make it difficult to calculate and confusing to interpret. People commonly get into trouble when they try to use OEE primarily as a high-level KPI (key performance indicator), to multiply OEE across several machines in a department or plant, or to calculate OEE on every piece of equipment. In a recent article on The LEANing Post, and a related article in Industry Week, Productivity’s Ellis New covers the do’s and don’ts of OEE, and four key ways to use it effectively.

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