At the start of a project, decisions related to equipment selection and set-up, set the stage for life-cycle equipment reliability and cost. The project team or engineers could plan the site setup and equipment using concrete technical information and know-how, thinking about the lifetime use of the equipment, or they may not. In many cases, cost cutting and construction or installation shortcuts affect the long-term reliability of the equipment and increase life-cycle costs. The lack of technical planning from the start results in high periods of unreliable operation; added maintenance, and modifications and workarounds to make the equipment perform as originally designed.

What if the technical know-how or elements required for planning life-cycle equipment reliability are not known, not addressed, or ignored during the project planning/design stage? Then there is every possibility that reliability, operating and maintenance budget, if it exists, and the expected equipment life would all be a huge gamble. While the project may be completed on schedule and under budget, is that what defines business success?

On the other hand, what if there was an engineering or technical plan in place that specified all the elements important to the business, short- and long-term, over the equipment’s life cycle? In this case, it is likely that the reliability, operating and maintenance costs, and planned life of the equipment, system or facility would contribute to business success.


Below are five important questions to help us begin thinking about implementing a life-cycle physical asset management system. Use them with your business management team, engineering group, and/or operations and maintenance supervisors.

1. What are the major equipment or assets used in your business supposed to do in support of your business goals?
2. Which key equipment puts the achievement of the business’ goals most at risk?
3. What processes are in place to assure that this equipment performs as expected throughout their planned life cycle?
4. What processes are missing that may be preventing these assets from performing as expected throughout their planned life cycle?
5. What are the life-cycle equipment management processes that should be established to guarantee the answer to the first question is predictably and consistently assured?

This is exactly what the ISO 55000:2014 Asset Management Standard is asking organizations to define: an asset-management system that covers the entire life cycle of physical assets.

According to ISO 55000:2014, an asset-management system is a set of interrelated and interacting elements of an organization, whose function is to establish the asset-management policy and asset management objectives, and the processes, needed to achieve those objectives. An asset-management system is used by the organization to direct, coordinate and control asset-management activities. (ISO 55000:2008, 2.4.3 & 2.5.1)

Life-cycle Reliability

Focusing on reliability and cost, the life cycle of the equipment can be broken down into many phases and activities. TO make this simple and concise, let’s point out the four important ones and look at elements of each that have a direct impact on reliability and cost.

A) Project Planning/Design Stage
Equipment planning and selection requires a technically knowledgeable team who can think ahead, focusing on how the equipment will be used and how to incorporate life-cycle reliability and cost into the project design and planning. Remember that 95% of life-cycle costs are affected by decisions made at this stage.

In this stage, the critical elements required to assure the new equipment will perform as expected include:

i) Goals of the business (financial, expected equipment life, yes/no criteria)
ii) Business concept/set-up in terms of how operations will run, preventative maintenance plan, software and automated systems to be utilized, staffing levels, financial targets
iii) Management activities – involvement in project management, equipment selection, installation, start-up/commissioning, operations, maintenance, spare parts, and training.
iv) Engineering reviews – Operability engineering, maintainability engineering, and reliability engineering
v) Documentation – Records of detailed engineering drawings, diagrams, schematics, specifications, and calibrations.



B) Acquisition-Construction Stage
This stage involves putting the detailed design into action from procurement to equipment installation and testing to start-up/commissioning. A number of activities that influence this stage were initially defined in and influenced by the Planning/Design Stage.

In this stage, life-cycle reliability- and cost-critical elements required to assure the new equipment will perform as expected include:

i) Supplier engineering handoff to business operations personnel
ii) Installation, start-up/commissioning
iii) Identification of pre-startup maintenance requirements
iv) Development of operations and maintenance work methods
v) Definition of job skills and knowledge requirements
vi) Maintenance control systems (CMMS, EAM)
vii) Maintenance, spare parts, QA/QC, material handling, training facilities
viii) Critical spare parts, consumables, inventory levels, management systems
ix) Documentation – detailed machine drawings, diagrams, schematics, specifications, calibrations, operation instructions, maintenance and repair instructions, troubleshooting charts, bills of materials
x) Initial workforce recruiting, screening, hiring, on-boarding, training

C) Operation-Maintenance Stage
This is the longest equipment life-cycle stage. While the first two stages may have been successful, it is the Operation-Maintenance Stage that proves the concept over and over again. This is also the phase where the asset-management system endures.

In this stage, life-cycle reliability- and cost-critical elements required to assure the new design will perform as expected include:

i) On-going workforce development – recruiting, screening, hiring, on-boarding, training standards
ii) Maintenance and repair work processes – planned, preventive, predictive, overhaul, repair, unplanned repair standards
iii) Spare parts management, inventory control standards
iv) Data gathering, analysis, reporting systems standards.

D) Decommissioning-Disposal-Restoration Stage
Think of this as an end-of-life stage that encompasses decisions and actions regarding the next steps for the equipment. It can be as involved as decommissioning and disposal of materials or as simple as surplus or scrap sales. There may also be cases where the equipment or sub-components and major equipment items can be reconditioned, restored, or repurposed.

Where are you now?

Life-cycle reliability, costs, and asset management are all highly interrelated and interconnected. Therefore, achieving your business goals in a consistent manner is dependent on an asset-management system that establishes and deploys the policy and objectives along with the processes necessary to achieve those objectives.

Planning new projects? Great: You’re in the Project-Design or Acquisition-Construction Stages.

Already in the Operation-Maintenance Stage? Don’t worry: It’s not too late to begin your life-cycle asset management journey. Pay attention to the elements listed for this stage. In the meantime, look back at elements of the previous stages and begin fleshing them out with an effective asset management system in mind.

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