November 16, 2018, 9:09 am

Asset Management Culture – Implementing ISO 55000

Organisational cultureWhile it is tempting to focus on processes and systems as being at the core of good Asset Management, success is only achieved by ensuring that the right behaviours and attitudes are in place in an organisation.  This article, the tenth article in our ISO 55000 Asset Management series, discusses the behaviours that are essential for good asset management, and the elements that drive these behaviours.

The complete series includes:

 

If you want to be notified of the release of future articles in this series, Subscribe to our Newsletter.

 

What is Culture?

What is culture? A simple definition is “the way we do things around here”. If you want a more complex definition that, in essence, means the same thing, you can define it as:[1]

The values and behaviours that contribute to the unique social and psychological environment of an organization

In other words, an organisation’s culture related primarily to behaviours (what people do) as underpinned by a set of values (unwritten, and often subconscious, beliefs or rules regarding what is considered “acceptable” and/or valued).

There are many, many books and articles written about organisational culture, and it is not our intent to discuss the general aspects of organisational culture in this article, but instead to discuss some key points relating to organisational culture as it applies to Asset Management and ISO 55001.

 

What is an “Asset Management Culture”?

ISO 55001 makes no direct reference to organisational culture.  In fact the word “culture” is not mentioned once in ISO 55001: 2014. Yet most who are involved in establishing sound Asset Management processes and systems within organisations recognise the vital role of an organisation’s culture in facilitating success.  So what are the key aspects of an organisation’s culture that separate those organisations that do Asset Management well, from those that do it less well? To answer this question, we begin with some common models of culture and examine these for applicability to asset management.

Deal and Kennedy in their classic 1982 book, “Corporate Cultures: The Rites and Rituals of Corporate Life” consider the six elements of an organisation’s culture to be:

  • History – A shared narrative of the organisation’s past, which keeps people anchored to the key values which the organisation was founded on.
  • Values – the beliefs and assumptions that provide a set of guiding principles for decision-making
  • Heroes - those employees and managers whose status is elevated because they embody organisational values and therefore serve as role models for others
  • Rites and Rituals – the ceremonies and routine events which bring people together
  • The Cultural Network – the informal network within an organisation which works behind the scenes to communicate information, spread gossip and rumours and influence behaviours

Our Asset Management culture, then, will be the way that these elements interact to shape the management of – and indeed the way we think about – our assets. These elements therefore provide a valuable basis for informing us as to how we might influence Asset Management culture but do not in themselves answer our question with regards to what “good” looks like. To do this, we turn to Ledet’s model of Operational Improvement, illustrated below.

Ledets model of Operational Improvement

Note that we have modified Ledet’s original terminology to describe the “Strategic” domain as “Asset Management”, because we believe that several key cultural elements that exist in this domain are dominant in a best-practice “Asset Management” organisation. In fact, it is easy to see how Ledet’s Alignment and Integration elements correspond to the Value and Alignment Fundamentals of Asset Management from ISO 55000:2014. Taking into account the Leadership and Assurance Fundamentals as well, we can define five characteristics that we believe differentiate a “good” Asset Management culture from less effective cultures.  These are:

  • Vertical Organisational Alignment
  • Horizontal Organisational Alignment
  • Organisational Discipline
  • Continuous Improvement Mentality
  • A Proactive Mindset

Let’s discuss each of these in turn.

 

Vertical Organisational Alignment

Vertical organisational alignment is often otherwise known as “line of sight”.  In a vertically aligned organisation, all members of the organisation:

  • know and understand the organisation’s mission, strategy, objectives and goals,
  • understand their role in helping to achieve those goals, and
  • ensure that their actions are aligned with the achievement of those goals.

In excellent organisations, members of the organisation are enthused by the organisation’s mission and objectives and are highly engaged and motivated to ensure that the organisation succeeds.

We can see that Vertical Alignment based on the organisation’s strategy, objectives and goals creates shared values that form a set of guiding principles for decision-making, and therefore fit within the Values element of Deal and Kennedy’s model.  We can also see that achieving this is critical to the Alignment (shared vision) element of Ledet’s model and the ISO 55000 Fundamental of Value.  As such, Vertical Alignment is an essential characteristic of a “good” Asset Management culture.

Horizontal Organisational Alignment

When we refer to Horizontal Alignment, we are referring to cross-functional alignment across departments.  In a horizontally aligned organisation, all organisational departments:

  • Are working towards the achievement of shared goals.  These goals are optimised for the organisation as a whole, rather than being optimum for one department without consideration of the impact on other departments.
  • Look for opportunities to collaborate on joint improvement initiatives that are focused on the common good

Achieving a horizontally aligned organisation requires a high degree of understanding, on the part of members of one function, of their impact on other functions and the organisation as a whole.

This characteristic is also part of the Value element of Deal and Kennedy’s model, as well as Ledet’s Alignment (shared vision) element and the ISO 55000 Value Fundamental. In addition, it contributes to Ledet’s Integration element and the ISO 55000 Alignment Fundamental and is therefore a key characteristic of an effective Asset Management culture.

Organisational Discipline

Organisations that perform Asset Management well adhere to clearly defined processes and procedures – particularly where the risks associated with non-compliance are significant.  Individuals hold a high degree of personal accountability for compliance and need to operate within a culture that values and promotes understanding of the importance of compliance in ensuring that the organisation achieves its goals.  This is not a culture of “grudging compliance” – it is one where compliance is genuinely valued and appreciated.

The ISO 55000 Fundamentals of Leadership and Assurance exist, in part, to drive informed compliance and the Leadership Fundamental explicitly recognises the importance of culture in achieving this. Within Ledet’s model, Organisational Discipline is an essential aspect of the Planned domain and only takes on additional importance as the organisation moves toward the Strategic/Asset Management domain.

culture at work

Continuous Improvement Mentality

Organisations that perform Asset Management well have an innovative element to their culture to enable them to identify and adapt to new opportunities and situations.  One of the challenges in establishing this is that innovation is often seen as being mutually exclusive to Organisational Discipline.  How can you encourage compliance while at the same time encouraging innovation and improvement?  The secret to achieving both is in establishing clear boundaries within which innovation can occur, and processes for ensuring that innovations don’t jeopardise the achievement of organisational objectives.  In particular, it is important to ensure that that the potential risks associated with each proposed innovation are fully explored and dealt with prior to embarking on an innovation project.  Larger organisations may establish innovation “skunk works” as a means of achieving these goals.  But in all cases, it requires those working on the innovation to have a clear and realistic understanding of the risks associated with varying from approved processes and procedures, and the potential impacts of changes on other individuals and departments within their organisation.

The complete set of Asset Management Fundamentals describe a continuous improvement process and capturing this mindset is therefore at the heart of “good” Asset Management. Equivalently, Ledet identifies continuous improvement as a key aspect of the Proactive domain, with this again carrying forward into the Strategy/Asset Management domain.

A Proactive Mindset

One of the key features of Asset Management excellence within an organisation is a relentless focus on being ahead of the game.  Organisations that are good at asset management don’t just let things happen – they make them happen.  And when events do occur that are outside their control, they are already prepared for them, and have contingency plans, systems and processes in place to deal with them.  This constant, proactive mindset is an essential element of the culture of high performing Asset Management organisations.  It has much in common with the High Reliability Organisations studied by Weick, Sutcliffe and Obstfeld.   High reliability organisations are characterised by “processes of collective mindfulness which are indicated by a preoccupation with failure, reluctance to simplify interpretations, sensitivity to operations, commitment to resilience, and deference to expertise”.  This aligns with the “System Performance” focus in Ledet’s model and the Assurance Fundamental of ISO 55000.

 

How to Establish an Asset Management Culture

So how do you go about establishing an Asset Management culture? Changing organisational culture is notoriously difficult and takes considerable time.  There are entire books written on the topic, and space prohibits a detailed examination of this topic in this article.  The following represents six practical tips that address the elements of culture in Deal and Kennedy’s model and, based on our experience, work to deliver sustainable change in the 5 key characteristics of an effective Asset Management culture.

Make the Vision Inspiring and Communicate it Often

We have seen that a shared set of values based on the organisation’s goals and objectives is essential to a sound Asset Management culture. Unfortunately, most organisational and departmental visions, goals and objectives are thoroughly boring and serve neither to inspire nor to motivate those that work within them.  If you can, try to make the vision for your organisation or department simpler, more personal and more emotional.  Try to find a common theme that aligns with people’s personal wishes and desires and you will find that they will rally behind you.  People generally want to make a difference, and if you can tap into that desire and align it with the goals and ambitions of your organisation, then it can be a very powerful force.

In addition, you also need to keep reminding people of the vision – why do they work here?  In what way can they contribute towards the achievement of this higher cause?  If you can inspire them, then they will require less management. They will, within the limits of their capabilities, direct their energies towards the achievement of your shared goals.  This will help to achieve the goal of Vertical Alignment discussed earlier in this article.

Establish Rites and Rituals that Promote Desired Behaviours

You cannot change people’s values directly, but you can establish routines in behaviour that gradually shape those values, which is the point of the Rites and Rituals portion of Deal and Kennedy’s model.  For example, if you want to establish a higher level of Horizontal Alignment within your organisation, create regular meetings that encourage cross-functional communication and collaboration and therefore facilitate a “whole of business” viewpoint and focus.  For example, ensure that your Production/Operations people attend regular Maintenance Planning meetings – or that key Supply representatives attend Shutdown Planning meetings.  Establishing cross-functional improvement teams also helps in this area – workshopping improved Preventive Maintenance programs with maintainers, engineers and operators is often a great way to create a higher degree of collaboration and alignment.  The more regular and habitual these meetings become, then the more they become ingrained as “the way we do things around here”.

Look for Successes and Reward Desirable Behaviours

Formal performance measurement systems should encourage and reward the desired behaviours, but informal reward systems should as well.  If Horizontal Alignment is the aim, why not ensure that Maintenance Manager performance and Production Manager performance are measured using the same KPIs?  Rewarding the Maintenance Manager (and Production Manager) for ensuring that the organisation meets its Production targets, and simultaneously rewarding the Production Manager (and Maintenance Manager) for ensuring that the plant achieves its reliability targets will create a much more collaborative relationship than the traditional way of assessing performance.

But in addition to that, look for situations where an individual has gone above and beyond expectations, and demonstrated behaviours that you would like to see repeated in your organisation, and ensure that that performance is recognised – a pat on the back, or a mention in a meeting can be a very powerful tool for creating “Heroes” that illustrate to others the behaviours that they should aspire to display.

Create a Mythology

Following on from the previous point, don’t be afraid to use story-telling as a powerful tool to create an organisational mythology which demonstrates the way in which individuals have, in the past, demonstrated the behaviours that you would like others to emulate. This can tap into both the Heroes and History elements of Deal and Kennedy’s model and powerfully influence culture.

I previously worked for Fedex, at a time when their slogan was “Absolutely, Positively On Time, or your Money Back”.  Fedex’s formal performance measurement systems reinforced this value – On-Time Delivery Performance was one of the first measures discussed at just about every meeting, whether it was a daily pre-start meeting with delivery drivers, or a meeting of senior executive.   But in addition, there was a series of anecdotes that were frequently told through the organisation about the extraordinary lengths that Fedex staff would go to in order to ensure that every possible package was delivered on time – including, in one case, chartering a helicopter as the recipient (in a rural area) was snowed in.  These anecdotes were sources of great pride, and served to reinforce the types of behaviours that were accepted and encouraged in pursuit of the organisation’s mission.

lead by example

Lead by Example – Act as a Role Model

Clearly, as a leader, you cannot ask others to behave in one manner, and then act in a different way yourself.  You need to walk the walk, as well as talking the talk.  Be aware that those that you are leading are watching your every move, and if you do something that is inconsistent with what you have asked others to do, it will be noticed.  You have to set even higher standards for yourself than those that you expect of others.

Manage the Informal Communications Networks

Finally, you need to be conscious of, and actively manage, the Cultural Network – the rumour and gossip mill that exists within your organisation.  Make sure that it is fed with positive stories that reinforce the culture you are trying to implement, rather than negative stories.  If you follow the suggestions followed in the sections above titled Create a Mythology and Lead by Example, you will be well served in this area also.  Be aware that everything you say may be repeated through the gossip mill, so make sure that what you say (even if you think it is being said “in confidence”) reinforces the positive aspects of what you are trying to achieve.

 

The Role of Leadership in Establishing an Asset Management Culture

The actions that we have discussed above can realistically only be driven from the top down.  Ideally, if an organisation-wide culture change is required (and it often is, when establishing an Asset Management culture), then this should come from the CEO and his/her colleagues in the C-Suite.  However leaders at lower levels in the organisation can often help to establish the right culture within their own sphere of influence. Leadership is therefore a vital aspect of establishing a sound Asset Management Culture.

Effective culture change requires the right balance between the use of Leadership Tools (creating an inspiring vision and continually communicating it, finding and telling stories that inspire alignment with the new vision, walking the talk etc) and Management Tools (ensuring that roles and responsibilities are clear, establishing the right performance measures, recruiting the right people, ensuring that the organisation has the right competencies etc). Many people are more comfortable using the Management Tools than the Leadership Tools. However those that swing the balance to increase their use of Leadership Tools frequently achieve great results – these are the people that you see collecting the awards for outstanding performance.

ISO 55001 makes several references to the role of top management and leadership in establishing sound asset management practices. Many of the activities expected of top management in ISO 55001 are managerial in nature (for example, ensuring that an asset management policy, Strategic Asset Management Plan etc are established).  However many are true leadership activities and involve words such as:

  • Communicating
  • Supporting, and
  • Promoting

Without these activities, a true Asset Management culture cannot be established.

As mentioned earlier, top level involvement is essential, but individuals at all organisational levels can display leadership, shape the culture within their circle of influence and create meaningful change.  There will be limits to what you can achieve at lower levels in the organisation – particularly where your people interact with those from other workgroups who may not share the same cultural beliefs or perspectives. Nevertheless, you CAN make a difference.

 

Conclusion

Your success in implementing an ISO 55001-compliant Asset Management system will depend heavily on your ability to ensure that the culture within your organisation supports effective implementation of this system.  In this article, we have attempted to describe the key attributes of a “good” Asset Management culture, and give you a few tips regarding how to implement it.

If you want to discuss this article further, or would like some assistance to implement some of the activities listed in this article then please contact us here.  Or alternatively, if you would like to learn more about implementing an ISO 55001-compliant Asset Management system, you may want to attend one of our two-day, IAM-endorsed courses on this topic – for more information click here.

 

Sandy Dunn

Director



 

Related Articles

Case Study - Asset Management Training
Hydro Tasmania is Australia’s leading producer of renewable energy, with over 100 years of experience producing hydroelectric power.  Owned...
Using ISO 55000 and Integrated Information Systems to Drive Organisational Alignment
One of the central tenets underpinning ISO 55000, the international standard for Asset Management, is that organisations perform better when there the...
Asset Management Data and Decision Making – Implementing ISO 55000
A vital element of effective Asset Management is decision-making that is evidence-based and data-driven. In addition, sufficient, accurate data and...
Case Study - ISO 55001 Gap Assessment
Hydro Tasmania is Australia’s leading producer of renewable energy, with over 100 years of experience producing hydroelectric power.  Owned...
Asset Management Plans – Less is More
Asset management is increasingly being recognised as a critical contributor to value across a wide variety of industries. Too often, however, the...