Building tomorrow's Asset-intensive enterprise
Assets are the heart of an asset-intensive enterprise... which means the overall performance of these companies is completely driven by the performance of their critical assets, and the impact of poor performance can be significant.
At the same time, asset-intensive industries by their very intrinsic nature are faced with a distinct set of challenges- which need to be efficiently managed to achieve long-term success.
These issues tend to be the relatively same set that doesn't change as time goes by, and includes the following
- Increasingly large number of assets to manage and a wide varieties of them
- Extremely complex assets that have completely redefined the failure patterns
- Multi-vendor equipment with diverse technologies and protocols
- Aging assets due to tough economic decisions
- Extremely long lifetime and the need to maximize the life-time asset performance
- Geographically spread assets, often located at harsh and hard-to-reach locations and overseen by a field-based workforce
- Increasing financial pressures to improve return-on-asset and reduce total-cost-of-ownership
- Increasing regulatory focus- changing regulatory frameworks and tighter controls
And this list is only expanding...
In reality, these industries are struggling to effectively mitigate these challenges and are fraught with key issues like increased downtime, low utilization & productivity levels and increased operational & maintenance cost.
A recent survey conducted by Mckinsey has revealed that currently the production equipment by global manufacturers is just put to 52% utilization on an average. While the other 48% is consumed in maintenance, upgrades, shutdown, training and replacement activities.
Tomorrow's asset-intensive enterprise is all about achieving Asset Efficiency
With the looming uncertain economic conditions and competitive marketplace ahead, companies in the asset-intensive industries are forced to focus on their assets, to drive efficiency across asset lifecycle. There is going to be a renewed emphasis to somehow reduce downtime, improve performance and productivity. Plant and machinery would be expected to perform at levels that were not thought possible a decade ago. Expectations towards improved asset efficiency and their associated performance would elevate the speed and pressure on asset intensive industries to manage their assets effectively. While achieving asset efficiency has been a big challenge, the industry well understand that this could mean the difference between profit and loss, achieving and missing production targets, regulatory compliance and non-compliance.
Therefore understanding the most effective and efficient ways to achieve efficiency is the critical task for any asset intensive enterprise.
In this context, I thought it would be a good idea to focus on some of key aspects of achieving 'asset efficiency' through a series of articles tilted 'Building tomorrow's asset-intensive enterprise'.
Note: Please look for the upcoming posts as a part of this series