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| Global Asset Sustainability Is The New Focus |
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It is no longer good business practice to address the efficiency of any asset without a clear understanding of its associated energy performance. Companies around the world are taking a brand-new approach to the management of their asset banks and a new approach is being born, that of "global asset sustainability." Management teams are finding that through this awakened approach to asset management they are improving their financial metrics across the board.
It is no longer good business practice to address the efficiency of any asset without a clear understanding of its associated energy performance. Companies around the world are taking a brand-new approach to the management of their asset banks and a new approach is being born, that of "global asset sustainability." Management teams are finding that through this awakened approach to asset management they are improving their financial metrics across the board. The unrelenting growth in the price of energy is the primary driver behind a new approach toward global asset sustainability. Energy prices are rising relentlessly and its supply can be very insecure. Companies are beginning to realize how energy can significantly affect their profit margins and ultimately, their absolute viability. Not only should energy costs themselves be a cause of concern, but the associated emission of greenhouse gases is another hot potato. All elements of the operation must be leveraged if inefficiencies are going to be revealed. We used to look at asset management from a perspective of conventional efficiency by itself. We would simply look at whether an asset was performing and producing according to the specification of its design and manufacture. The fact that the asset may be consuming more energy than it ought to was often invisible, yet this was a real cost and causing a reallocation of budgets from elsewhere in the company. Global asset sustainability focuses on energy consumption in addition to asset availability, performance and condition. When we consider that, according to the Department Of Energy, typical commercial and industrial companies in the United States spend over 80% of their nonlabor operating and maintenance budget on energy as opposed to maintenance, we can see that the traditional classification of efficiency is far from appropriate. Let's look at how we should manage assets. The new approach of global asset sustainability focuses first on the critical element of availability. It goes without saying that maximum uptime is essential if the company is to be able to generate any revenues. Next, the company must consider how each asset is performing against its specification and warranty. This dictates the return on investment and is the primary, traditional metric that companies use to determine good value. Ultimate performance often makes the difference between operating on razor thin margins and making a profit and as such, asset performance is a base metric, with quality control determining market position. The most important factor in global asset sustainability is one that has previously been largely invisible -- energy consumption. The baseline position needs to be established for each asset, when it is known to be running at its prime. The asset can then be evaluated in real-time on an ongoing basis to determine whether it is being ultimately efficient or not. A slight variation in efficiency, when measured across the typical distributed enterprise, can mean an operating loss for the company. Overall equipment effectiveness readings will have to be modified to take into account energy as part of a new approach to global asset sustainability. Energy is and will continue to be the largest cost liability and companies must be in a position to monitor and micromanage it. About the Author: Daniel Stouffer has much more data about global asset sustainability and how a visit to www.verisae.com will be of use to you. |