November 18, 2018, 2:24 pm

Asset Management Strategy vs Strategic Asset Management Plan (SAMP) – Has ISO got it wrong?

In dealings with our clients, I often find that there is considerable confusion regarding what should be contained in a Strategic Asset Management Plan (SAMP). We have seen SAMPs that are upwards of 200 pages long – a mighty tome that is destined to rapidly become “shelfware” and of little value to anybody. This confusion is exacerbated by the lack of clarity in guidance that is provided in ISO 55000, ISO 55001 and ISO 55002. In our view, it appears that ISO itself (or at least TC251 – the technical committee that put together ISO 55001) is confused regarding its definition of the SAMP. More specifically, they have confused two separate documents – an Asset Management Strategy, and the Strategic Asset Management Plan. We hope that this will be clarified in the next version of ISO 55001, but in the meantime, I outline the reasoning for why improvements are needed below.

First, let’s make sure we are all on the same page when it comes to terminology.

SAMP Template

Plans, Processes, Strategies and Tactics

What is a Plan?

In our training workshops, when we ask participants what they would expect to see in a plan, they almost without exception state that they would expect a plan to contain actions with their associated:

  • Timeframes
  • Responsibilities, and
  • Resource requirements (money, people etc.)

This is not an unreasonable expectation. In short, a plan tells you what needs to be done, by when, by whom, and what resources you need. It does not tell you how to perform these actions.

Furthermore, if this is the expectation from a plan, then clearly the plan needs to be updated on a frequent basis in line with the timeframes used to monitor progress against the plan. If timeframes change (as they inevitably do), or resource requirements change – or even if the actions to be performed change, then the plan needs to be updated.

Procedures and Processes

So, what is the difference between a plan and a procedure?

I think a useful distinction is to consider that if a plan tells you what to do, a procedure tells you how to do it. One of the complicating factors here, however, is that the word “process” also tends to get used when talking about how to do things. While some people tend to use the words “process” and “procedure” interchangeably, I find it useful to distinguish between the two in terms of depth and breadth. Processes are typically higher level and broader but contain less detail. Procedures tend to have a narrower scope and are more detailed. If we accept this distinction, then procedures can sit within processes. For those that are familiar with business process mapping and business process mapping architecture (see https://en.wikipedia.org/wiki/Business_process_mapping), procedures typically accompany or replace lower level (e.g. Level 3 or 4) business processes.

Strategic Thinking vs Tactical Thinking

Perhaps easier to understand is the difference between strategic and tactical thinking. Strategic thinking is generally accepted to be higher-level, bigger picture, and longer-term in nature. Often with a lower level of detail.

On the other hand, tactical thinking is shorter-term and generally more detailed.

Strategies vs Processes and Procedures

So, what is a strategy?

I have a strong affinity for the views of Ann Latham, as outlined in her Forbes article “What The Heck Is A Strategy Anyway?”. She states that “The biggest problem with the way organizations think about strategy is they confuse strategy with plans.” Her definition of a strategy is that it is “a framework for making decisions….”. In other words, it outlines how things are to be done, as distinct from a plan which describes what is to be done. A strategy is not the same thing as a strategic plan.strategy process

Of course, by definition, the strategy will be higher-level, bigger picture and longer-term in nature. As one of a suite of documents, a strategy presents the big-picture view of how things are done and how decisions are to be made. Processes and procedures will provide progressively more detail at lower levels. One way of visualising this is through the following diagram.

So Why the Confusion Regarding SAMPs?

If we accept the definitions and concepts outlined earlier, we should expect the Strategic Asset Management Plan to be both strategic and a plan. That is, it should be:

  • High level – it relates to the big picture and focuses on the most important (and possibly most expensive) activities to be performed for the organisation to achieve its Asset management objectives
  • Longer-term – it takes a longer-term view of the activities required for Asset Management success.
  • Action-oriented – it describes the activities to be performed in order to meet Asset Management objectives, and their associated timeframes, responsibilities and resource requirements. Being a “plan” it should describe what is to be done, but not how it is to be done.

In short, we would expect the SAMP to exist as a high-level, longer term action plan focusing on the most important actions to be taken for the organisation to ensure that it achieves its Asset Management Objectives.

However, the definition of the Strategic Asset Management Plan contained within ISO 55001 states that it is “documented information that specifies how organizational objectives are to be converted into asset management objectives, the approach for developing asset management plans, and the role of the asset management system in supporting achievement of the asset management objectives” (ISO 55000:2014 p.14 – emphasis added).

Nothing in this definition suggests that the SAMP should be action-oriented; that it should contain the actions required to ensure that Asset Management objectives are achieved. Quite the contrary, it explicitly states that this document is required to specify how things are to be done. Furthermore, this is reinforced by statements in ISO 55000 that state that “The principles by which the organization intends applying asset management to achieve its organizational objectives should be set out in an asset management policy. The approach to implementing these principles should be documented in a strategic asset management plan (SAMP)” (ISO 55000:2014 p8). ISO 55002 further reinforces this view by stating that “The SAMP….should define the framework required to achieve the asset management objectives” (ISO 55002:2014 p.2).

This, to my (and most people’s) way of thinking is not the definition of a plan. It is, however, a pretty good definition of an Asset Management Strategy. The confused thinking in ISO 55001 relating to the difference between a Strategy and a Strategic Plan is only highlighted by the notes in both ISO 55000 and ISO 55002 which state that “A strategic asset management plan can be referred to by other names, e.g. an asset management strategy” (ISO 55000:2014 p8). No wonder there is confusion amongst those trying to interpret ISO 55001.

So How to Move Forward?

It is clear that both an Asset Management Strategy and a Strategic Asset Management plan are required for effective Asset Management. At a high level, for Asset Management to be effective, organisations should document:

  • Their strategic approach to ensuring there is alignment in Asset Management decision-making within their organisation; how decisions are made – i.e. their Asset Management Strategy. In this context, by “alignment” I mean that all asset management decision-making should be driven by a common view of what “value” means to the organisation (a potential topic for a whole new article!); and
  • The strategic actions required in order to ensure that Assets and the Asset Management System will achieve the organisation’s Asset Management Objectives (ISO 55000 defines Objectives as “results to be achieved”) – i.e. their Strategic Asset Management Plan.

As ISO 55001 does not distinguish between these two documents (and indeed considers the titles to be interchangeable), it could be possible to combine these two elements in one document (which could be called a SAMP in order to align with ISO 55000 terminology). However, at Assetivity, we advise against that for three reasons:

  • First, as mentioned earlier, a plan should be updated regularly as and when actions are completed, deleted or added to or when timeframes and priorities are adjusted. In other words, a plan should be a living document subject to regular and frequent review. On the other hand, an organisation’s processes and procedures – its methods for managing its assets and making decisions – are likely to change rarely, especially at a strategic level, and when changed, these changes tend to be comparatively minor. The need for review of these, therefore, is much less frequent, and the nature of the changes comparatively narrow in scope.
  • Second, the users of these documents will be different. Those using and updating the SAMP will typically be more senior personnel within the organisation who are already familiar with the Asset Management Strategy. On the other hand, users of the Asset Management Strategy may come from many areas within the organisation – essentially anyone who needs to understand, at a high level, the processes that the organisation uses to manage its assets. Many of these people will not need to know the detail of what is contained within the SAMP. Making either group read through material that is irrelevant to them does not make the document user-friendly.
  • Third, the combined document is likely to be comparatively larger, and therefore more daunting to approach. Concise, targeted documents aimed at specific user groups are much more useful, and therefore much more likely to be used. Large, unwieldy documents are almost inevitably destined to become “shelfware” – gathering dust, taking up shelf-space and unused.

So what may each of these documents look like?

The Asset Management Strategy

The Asset Management Strategy outlines the strategic approach for Asset Management within the organisation. Here are a few tips:

  • As a strategy it is high level. It does not contain high levels of detail, but instead refers to (or provides links to) other documents (processes and procedures) within the organisation which contain that detail.
  • It does not repeat information that exists in other documents. This would be building a rod for your own back, because as soon as the content of one of those other documents changes, then you will also need to update the Asset Management Strategy. Document maintenance then would become unnecessarily burdensome.
  • It does, however, summarise the key scope and/or purpose of the processes and procedures so that those reading the Asset Management Strategy can understand which of those processes and procedures may be relevant for them to refer to.
  • Most importantly, it outlines how all of those other processes and procedures fit together in a cohesive, integrated management system which coordinates activity in order to deliver value from assets.
  • It doesn’t need to be called an Asset Management Strategy – in fact, at some of our clients, it is called the Asset Management Framework and can form part of an Asset Management Manual, which contains all of the relevant Asset Management related processes and procedures.
  • From an ISO 55001 compliance point of view – in order to comply with the requirement for a Strategic Asset Management Plan (as defined in ISO 55000) this document is mandatory. You may find that your ISO 55001 auditor insists that it is called a Strategic Asset Management Plan. If he does, just refer him to Note 2 under point 2.5.3.4 in ISO 55000. There is no such requirement.
  • It should be short. As a high-level outline of your Asset Management processes, there is no reason why it should be any longer than 30 pages in length. Make it shorter if you can – that will make it more accessible and more usable. 

The Strategic Asset Management Plan (SAMP)

The Strategic Asset Management Plan outlines the high level, strategic actions required in order to ensure that the organisation meets its organisational objectives. Here are a few tips:

  • The main focus of the document is the Strategic Initiatives (actions) required to bridge gaps between current (or forecast) Asset Management performance and the performance required in order to meet Asset Management Objectives (the “results to be achieved”).
  • Write the document with its readership in mind. Who is going to read the document? What are they going to use it for? What information do they need in order for the document to be useful? Include that, and only that information in the document.
  • Provide some context in the SAMP in order to provide justification for why the strategic Asset Management initiatives are required. This could include:
    • An outline of the organisational context/strategy/external environment/competitive pressures etc.
    • Current and forecast (over the term of the plan) Asset Management Objectives, and how these are linked to overall Organisational Objectives.
    • Trends and forecasts in Asset Management performance (compared with the Objectives)
    • Asset Management Risks and Opportunities
    • Identified gaps between expected and required performance in order to meet the Asset Management Objectives (assuming a “business as usual” approach).
  • The strategic initiatives should be able to be linked to the identified performance gaps, and the plan should demonstrate how these initiatives will bridge these gaps, as well as address the Asset Management Risks and Opportunities.
  • Not all improvement initiatives will be considered as “Strategic”. Limit yourself to including only the most significant initiatives within the SAMP. Initiatives could be considered “Strategic” if they:
    • Will take considerable time, effort and/or funding to complete
    • If not completed, will have a significant impact on the ability to achieve the Asset Management Objectives (and therefore overall Organisational Objectives)
    • Require coordination across multiple business functions or operating units.
  • For each initiative, the following elements should be outlined:
    • High level actions required
    • Responsibilities for completing each action
    • Timeframes for c completing each action
    • The resources (people, funding etc) required to complete each action.
  • The plan (and progress against it) should be reviewed updated regularly as part of the standard Plan-Do-Check-Act cycle that is in place within your organisation. This may be as frequently as monthly. It is unlikely to be less frequent than quarterly.
  • Once again, keep it short. No more than 20-30 pages, ideally. Shorter if you can.

ISO 55000 defines an Asset Management Plan as being “documented information that specifies the activities, resources and timescales required for an individual asset, or a grouping of assets, to achieve the organization's asset management objectives” (ISO 55000:2014 p.14). What I have described as a Strategic Asset Management Plan above, clearly meets these requirements. ISO 55000/55001/55002 makes no reference to the possibility that there could be a hierarchy of Asset Management Plans – but for larger organisations at least, we recommend that there be a higher-level asset management plan (the Strategic Asset Management Plan I have described in this section – even though ISO 55000 doesn’t call it that), as well as lower level Asset Management Plans. These lower level Asset Management Plans could also, potentially, be supported by even more detailed Maintenance Plans and Operations Plans.


So, if you visualise the document structure overall, it could look something like the following diagram.

plans vs processes

Conclusion

If you are interested in downloading a template for a Strategic Asset Management Plan, we have one freely available for download here. All you need do is sign up for our weekly newsletter where we share the latest news, articles and information relating to Asset Management, Maintenance and Reliability from around the planet. We also have a number of other articles relating to ISO 55000 and Asset Management which you may find useful. The page at Articles > Asset Mangement is a good starting point.

I hope you find that this article gives you greater clarity regarding this topic, and if I can be of any further assistance, please do not hesitate to contact me here.

A final note to ISO and TC 251

It is entirely possible that what I have outlined above was the intent of TC 251 when they first developed ISO 55001 – I know that there were restrictions placed on them by ISO’s desire for standardisation of management standards – in particular relating to definitions. However, if that was the intent, then the current documentation (ISO 55000, 55001 and 55002) certainly does not make this clear. Overall, ISO 55001 is a highly valuable document that provides much needed advice and guidance to those working in Asset-intensive industries, but there are always opportunities for making minor improvements in the light of experience.

In my view (and based on client feedback and experience) the approach outlined above provides a high degree of clarity and produces practical and valuable documentation while meeting the overall intent of ISO 55001. I hope that TC 251 will take the suggestions in this article into account during the next revision of this highly valuable standard.

 

Sandy Dunn

Director

 

Assetivity offers training on this and other maintenance engineering/asset management topics. For full descriptions and schedules click here

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