- PAS 55, a specification from the British Standards Institute and the International Asset Management Committee, was developed in response to demands from industry and regulators for a standard in asset management to enable asset-intensive businesses to ensure an organization’s asset management policies, strategies, actions and governance support the mission and objectives of the corporation in better serving stakeholders.
- PAS 55 addresses the lifecycle management of the organization’s mission-critical assets.
- PAS 55 places requirements on an organization that can be directly impacted and facilitated by the IT system used
For asset-intensive industries such as energy and utilities, mining, process manufacturing, and oil and gas, where the mission of the enterprise directly depends on asset performance, optimized management of asset infrastructure is a core business discipline affecting all business stakeholders. Customers want to see asset performance maximized so they can count on reliable deliveries and predictable cost. Regulators and employees want to ensure these assets are being designed and operated in accordance with environmental and safety requirements. And shareholders want to make certain that assets are operated and maintained in a manner consistent with producing the highest rate of return from their capital investments. In these industries, asset lifecycle management (ALM) is a core business support function, affecting all stakeholders in the enterprise value chain.
But while standards like ISO 9001 have been in existence for years, allowing corporations to document their quality processes, no specific standards have previously existed to enable asset-intensive businesses to ensure an organization’s asset management policies, strategies, actions and governance support the mission and objectives of the corporation in better serving stakeholders. Publically Available Specification 55 (PAS 55), a specification from the British Standards Institute and the International Asset Management Committee, was developed in response to demands from industry and regulators for such a standard in asset management.
PAS 55 has immediate and significant implications for executives in heavy industry. The implications of improved asset performance impact all areas of business operations and financial performance, such as the ability to mitigate conditions leading to events like the BP’s disaster in the Gulf of Mexico or the Union Carbide tragedy in India, by insuring that good asset management protocols have been adopted and followed. Investors, regulators and other stakeholders are increasingly looking for PAS 55 compliance as a measure of good management practice that will at once prevent these mishaps and offer proof of due diligence, limiting liability in the event of an industrial accident.
But independent of these types of external pressure, executive management in asset-intensive industries recognize PAS 55 as a tool to help them make good on their fiduciary responsibilities in accomplishing corporate strategic plans. By setting sound asset management policy that is consistent with corporate strategic goals and turning that policy into actionable activities, management can communicate these decisions to all parties involved in the asset value chain orchestrating the actions of these stakeholders to the desired mutual end.
The adoption of PAS 55 in June 2010 by the International Standards Organization (ISO), as a basis for an emerging global ISO standard in asset management, is an excellent indication of the momentum of the PAS 55 movement and for the anticipated benefits corporations can anticipate. The experience of major corporations that have been early adopters is extremely positive with business cases that indicate significant operational improvements.
PAS 55 and enterprise asset management software
PAS 55 is intended to address the overall lifecycle management of assets — in particular, assets that are mission-critical to the purpose of the organization. Although the overall goal is to provide the structure and processes needed to harmonize organizational goals with your asset management behavior, PAS 55 does have implications for the information technology (IT) systems that are used to support the specification’s adoption and in proof of compliance. Section 4.4.6 provides guidance regarding these requirements.
In this section, the PAS states that an IT system shall address all phases of the asset lifecycle, including the upfront processes of planning and engineering the asset, its construction, ongoing maintenance and operation and its eventual retirement or decommissioning (Figure 1).
Figure 1. PAS 55 dictates that an IT system shall address all phases of the asset lifecycle.
One of the most important aspects is the requirement that the IT systems used must support an accurate and consistent view of all asset information — one version of the truth — ensuring policies, plans and actions are based on an accurate understanding of the history and current status of your asset infrastructure — very hard to manage in disparate applications across a corporation. In fact, it is equally difficult to accomplish this with an EAM software package that does not address the requirement to support the initial engineering, construction and project management phases of the asset’s lifecycle. Engineering, construction and project management functionality is not traditionally included in most EAM solutions on the market today.