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Evolution of asset management standards in hazardous environments

03 June 2013

This overview from BSI, the British Standards Institute, looks at asset management standards for organisations operating in hazardous industrial environments.

Asset management is the implementation of protocols to enhance the welfare of and reduce the risk to an asset. Whilst this is of importance to all assets, there are heightened risks in some areas placing the asset and the operation into potential jeopardy. The hazardous environment is one such example and has an impact on many industrial operations, in particular the petrochemicals, pharmaceuticals and nuclear industries.

Globally, physical asset management has grown over recent decades due to a combination of, firstly, the need to make sure assets are managed in the most cost effective way (and/or ratepayer-acceptable way) and, secondly, the need to meet requirements from regulations, legislation and other relevant audit/reporting requirements.  These drivers have taken the discipline of asset management from the original base of larger regulated utilities, to other industrial sectors and increasingly to all sectors.  This trend is likely to continue as asset management gets even greater organisational support and acceptance. 

Given its origin, the consideration of hazards has always been integral to asset management, whilst not necessarily the primary revenue source of those organisations implementing and maintaining asset management systems.  

Additionally, the growth and acceptance of asset management as a discipline has developed in step with the progress of standards in this area.  The Institute of Asset Management (IAM) took the leadership in the development of standards with the publication of two documents. Working with BSI, IAM developed ‘PAS 55-1 Asset management. Specification for the optimised management of physical assets’ and ‘PAS 55-2 Asset management. Guidelines for the application of PAS 55-1’, both of which were published in 2003 (with revisions in 2008). 

Although driven from the UK, these documents were developed by an international group and have global prominence.  Conformance with PAS 55 is regularly cited by organisations and is well understood by regulators around the globe.  Given this standing, it is unsurprising that PAS 55 became the base for the new ISO 55000 series of International Standards due for publication late 2013.  

Within the forthcoming series there are three international standards:

* ISO 55000 Asset management – Overview, principles and terminology 

* ISO 55001 Asset management – Requirements 

* ISO 55002 Asset management – Guidelines on the application of ISO 55001

These International Standards have been developed by asset management stakeholders from around the globe and were created to be used in concert.  As with PAS 55, the ISO 55000 series is written with the perspective of organisations using it as the basis for auditing their Asset Management System and/or obtaining external certification against it.  

If you have concerns about the transition of certification from PAS 55-1 to ISO 50001, your certification body will be able to give you an insight into this.  Based on the experience of other standards areas, the ISO series will further add to a common language and approach for asset management which will further boost the discipline.  

So, what is asset management and what benefits do organisations derive from it?  

PAS 55 defines asset management as the “systematic and coordinated activities and practices through which an organisation optimally and sustainably manages its assets and asset systems, their associated performance, risks and expenditures over their life cycles for the purpose of achieving its organisational strategic plan”. The draft ISO standards refer to the “coordinated activities of an organisation to realise value from assets.”  

From an organisational perspective, particularly in environments where flammability issues pose a high risk to operator wellbeing, there are a number of benefits of a holistic integrated asset management system. It will help to:

* Reduce the safety risks of operating the assets

* Reduce the potential health impacts of operating the assets

* Allow for systematic condition monitoring of equipment

* Improve the regulatory performance of the organisation and demonstrate compliance, supported by a clear audit trail

* Reduce legal risks associated with operating assets

* Allow for a greater ability to demonstrate socially responsible and ethical business practices within the organisation’s community

* Align processes, resources and functional contributions (instead of departmental silos and competing, short-term priorities), reducing the gaps in responsibility that can lead to an incident occurring 

To put this in context, Management System Standards such as the forthcoming ISO 55000 suite require senior management to have an active involvement.  As such, in any individual organisation, there are supporters of asset management at all levels:

* Boards of Directors will use it as a tool for accountability and risk management

* CEOs find it to be a powerful tool in resolving conflicts among divisions over resource allocation, ensure legal/regulatory obligations are being met and avoidance of major incidents that will have a detrimental impact on the organisation’s standing

* Chief Operating Officers see it as a lever to further integrate a health and safety culture and improve integration and performance

* Chief Financial Officers will use it as a source of data to reduce risk and improve opportunity in mergers and acquisitions

* Operations and maintenance workers expect it to help them remain safe and improve working conditions and job satisfaction

* Asset Managers see it as way to improve their influence and budget and ensure asset management is taken seriously across the organisation

* Customers are looking for improved service and for accountability

* The majority of employees will favour sound environmental policies and practices related to assets

For individuals responsible or interested in safe working operations within hazardous area environments, the development of asset management and asset management standards represents a positive development. For those with the role of ‘Asset Manager’, the development of the discipline ensures that asset management is taken seriously within the organisation and presents continuing career opportunities. For those associated with asset management, its development ensures that safety not only retains its importance within the organisation, but also that it is integrated into the other activities of the organisation. It reduces the chance of hazards appearing in the “silos” and gives it the appropriate exposure to all management levels of the organisation. 

Other standards of potential interest related to asset management and hazardous environments include 

* ISO 31000:2009, Risk management — Principles and guidelines

* ISO/IEC Guide 73:2009, Risk management – Vocabulary – Guidelines for use in standards

* IEC/ISO 31010:2009, Risk management – Risk assessment techniques

* IEC 60300-1:2003, Dependability management – Dependability management systems

* ISO 22301:2012. Societal security. Business continuity management systems. Requirements

* ISO 22313:2012. Societal security. Business continuity management systems. Guidance

* OHSAS 18001:2007. Occupational health and safety management systems. Requirements

* OHSAS 18002:2008. Occupational health and safety management systems. Guidelines for the implementation of OHSAS 18001:2007

* ISO 14001:2004, Environmental management systems - Specification with guidance for use

* ISO 9001:2008. Quality management systems. Requirements

* ISO 9004:2009. Managing for the sustained success of an organization. A quality management approach

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