Home > Facility Technologist >August 2004

Asset Management Alphabet Soup

By Tom Condon, RPA, FMA

Many facility professionals seem to be confused about asset management software. It's not surprising, since this is a very complex area, and everyone seems to have his or her own take on the subject. As a result of this confusion, many organizations are using non-CMMS products for asset management.

An issue that complicates this equation is the overwhelming number of software packages; there are over 100 different CMMS systems alone! In particular, Enterprise Resource Planning (ERP) has come on strong in the Enterprise Asset Management (EAM) market recently, and it is poised to take an even bigger share as its approach is fine-tuned for maintenance and other areas historically dominated by CMMS. (See Figure 1 for the market share of EAM systems in a software study. Notice that several strong contenders are ERP systems.)

As previously stated, various users have their own perspectives. So it is not surprising that they each have developed their own software. For the sake of clarification, this month's column will attempt to sort this out and provide readers with an understanding of the different systems available. Let's start by taking a look at some of the systems, including an overview of their history and a peek into their future.

EAM is a very broad category that really encompasses the gamut of systems examined here. There are software packages that call themselves EAM, but they will usually fall into one of the categories listed below.

CMMS focuses on what is traditionally referred to as hard-core maintenance. These systems are great for intensive maintenance operations. A good CMMS will give users the ability to track every piece of equipment (including sub-components), and every minute of labor, part, supply, or any other resource that was ever used to maintain it. These systems are very powerful and can provide advanced functionality like predictive maintenance, failure analysis, and more. For facility professionals who have a lot of equipment, do a lot of maintenance, and need to fine-tune performance down to a pretty specific level, an enterprise CMMS recommended.

ERP systems have entered the EAM landscape in recent years and have a distinct focus that integrates asset management with other management systems. While they do not focus on the level of maintenance detail that CMMS does, they also do things that CMMS cannot, like moving financial data on asset management seamlessly into accounting systems and tracking payroll and other human resources management aspects.

CAFM (computer aided facility management) focuses more on facility space planning from a visual perspective, but also provides some asset management functionality like depreciation, cost tracking, and maintenance. Some of these systems have evolved to the point where they have incorporated features more associated with CMMS (like preventive maintenance).

There are a number of related systems such as condition assessment software, which provides information that helps drive long-term strategic asset planning. These systems provide a way of rating the condition of the facility objectively, estimating the costs required to remedy defects, and even projecting how much must be saved every year in order to replace or repair the asset when it wears out.

This information can help planners make some really tough decisions, like whether to repair/renovate existing assets or build new. While these systems were predominantly used by financial planners, they are starting to become more common in facility and property management.

Deciding which system to choose is a major headache and is not something that most facility professionals do with great ease and comfort. However, it is essential to take the time to choose wisely. Studies show that the most common factors in asset management implementation failures are:

• Inaccurate product selection. Choosing a product that does not have the functionality that the organization needs can mean disaster.
• Insufficient resources. Implementing EAM requires significant resources devoted to the product. Many organizations do not realize the commitment in people and funds that will be needed to pull it off successfully.
• Lack of employee support: Incorporating EAM in an existing organization requires careful change management to ensure employees receive the training they need and are not alienated by the process.

While the resource and employee support risks can be mitigated by good planning, the choice of the wrong software is a mistake that cannot reasonably be undone and will plague the implementation throughout its life.

This alone is reason enough to devote significant resources to finding the right product. The facility professional's name will be associated with the system, no matter what the outcome is, and I have seen major career damage occur when an executive asks why this "fancy new computer system" cannot perform a function the executive wanted.

In the end, facility professionals should be better equipped to find the right asset management system, should they be in the market. Luckily, there is a way to choose the correct product that is almost foolproof. It takes more work, but the results are worth it.

Condon, a Facility Technologist and former facility manager, is one of the contributing authors for BOMI Institute's revised Technologies In Facilities Management textbook. He works for System Development Integration, a Chicago, IL-based firm committed to improving the performance, quality, and reliability of client business through the use of technology.

Do you have any questions about Facility Technology Convergence? If so, please send an e-mail with your thoughts to schwartz@groupc.com.