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  July 24th, 2017 | Written by

The EAM Chain Reaction

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  • Corporations are paying more attention to the environmental health and safety impacts of their supply chains.
  • Consumers are cognizant of how asset management decisions impact their communities.
  • Globally, health and safety regulations have become more stringent.

Enterprise Asset Management is more than just a glorified maintenance management system. Often associated with just the efficient management of asset maintenance, EAM has come into its own as a tool for managing the risk profile of capital assets, boosting employee health and safety and protecting the environment.

Here are four areas where EAM software can benefit businesses and help them to stay safe, compliant, environmentally-friendly and successful, all of which have implications in the boardroom.

1. A more responsible asset lifecycle

EAM software should not only address day-to-day operation and maintenance of assets like manufacturing facilities, oil refineries, power generation plants or offshore oil and gas rigs. It should be enable optimization of the entire asset lifecycle to minimize total cost and environmental impact, while maximizing return on capital and productivity.

And constructing new assets is seldom as conservative a use of resources as extending the lifecycle of existing assets. Newly-constructed assets consume resources in the form of materials and fossil fuels required for construction and often as previously greenfield property is placed under nonpermeable surfaces. The existing asset must also be decommissioned or scuttled, and that increases both financial and environmental impact. The capital required for a new asset can place a burden on not just a company, but its stakeholders and customers. Utilities rate payers for instance are often active and very vocal participants in decisions about construction of new generation capacity, wastewater treatment plants or other assets that will place a direct financial burden on them.

EAM must therefore address the entire asset lifecycle, from project management for design and construction of the new asset, from years of maintenance to decommissioning.

The cost and work of contractors must be included through vendor portals, ensuring that cost is captured and any alterations to the specifications of the asset are recorded. This as-designed, as-built and as-maintained view of the asset will enable a more nuanced approach to decisions about lifecycle extensions versus replacement of the asset. It will also reduce the risk of adding capacity to or updating an existing asset because comprehensive data on the existing state of the asset is reliably kept in EAM. This is why standards like the ISO 55000 asset management standard require all data about an asset be contained in a single database over the entire lifecycle of the asset, and why many investors and utility ratepayer groups want asset owners to adopt this comprehensive standard.

2. Meeting environmental challenges

While government regulation is experiencing volatility in the Americas, major corporations are still placing environmental mandates on their trading partners through green supply chain requirements. Companies like Walmart, IBM, P&G and Pepsico, along with federal governments, major institutions and even middle market companies, have started asking their suppliers to reduce their environmental footprints as a way to burnish their own green credentials.

Audits and environmental footprints

One thing is for sure. Meeting customer and regulator demands for information on an environmental footprint is daunting. Enterprise software products used in manufacturing may capture the environmental footprint of a product by recording impacts of component parts off of the bill of materials and rolling them up into the impact of a finished assembly. This may be particularly useful in compliance initiatives where chemical composition of a product may be subject to regulation, like material safety data sheet requirements, or where customers want to ensure various substances are not contained in products they sell.

But EAM ought to be up to, for instance, documenting the use of best practices like use of gaskets that limit fugitive emissions of greenhouse gasses or inspection of oil and gas pipelines to guard against leakage. In some situations, well-integrated functionality that can record the location where an inspection occurs using GIS technology, record inspection reports or materials testing results in embedded document management or prove that qualified personnel are performing maintenance work through embedded human resources functionality will go a long way to establishing that green credential.

3. Walking the compliance tightrope

While sustainability is a growing concern for organizations, compliance is absolute. In industries such as food and beverage, the penalty for non-compliance can be severe – just one slip through the net could seriously harm consumers and businesses.

EAM safety net

There are a vast number of training courses in the food and beverage industry, each one having a direct effect on which jobs employees can or cannot perform. Not only is skill-based workforce scheduling critical to putting the right person with the right skills on the right job to remain compliant – including asset maintenance. EAM that has demand planning and scheduling along with human resource management capabilities can ensure employees with the correct certifications are available to complete work that is mission critical given the production schedule.

This integration can enable critical maintenance processes to be completed between batches without causing delays, and that audits can be quickly completed showing that requisite cleaning or maintenance was completed by qualified people by lot and batch.

4. EAM embraces Field Service Management

Smarter service for vital support

Many asset-intensive organizations service assets that are housed remotely, sometimes at customer sites. These may be their owned assets or they may belong to the customer and are being serviced under an aftermarket agreement. Regardless, the customer experience hinges on efficient, timely service.

In the utilities industry for example, operations, maintenance and service contractors are often responsible for uptime of distributed assets ranging from meters to sewers to electrical distribution assets. The failure and resulting downtime of any of these assets carry financial penalties and damage stakeholder perceptions. The ability to ensure the right technician is on site quickly with the right parts and right skills to affect a repair is critical.

Smart maintenance in action

One Texas-based oilfield services company involved with the preparation, assembly and operation of key components for client drilling installations, found that software is used to optimize maintenance performed in the field could actually reduce their carbon footprint.

The company primarily performs planned, preventive maintenance activities, so delivery schedules are organized in advance to streamline operations. Since using real-time scheduling optimization software to plan the most efficient routes for its asset management workforce, the company has saved nearly $3 million in fuel costs alone. The result has been a huge reduction in the company’s carbon footprint.

The chain reaction: More than just bottom-line benefits

The impact of EAM spreads further than simply boosting the bottom line. EAM shouldn’t exist in its own ‘bubble’ and apply only to operational assets. With the capabilities of assets constantly changing and new technologies dramatically enhancing the power of data processing, enterprises need to have access to an EAM system which provides a holistic, 360-degree view of all assets – from design, right through to installation and operations.

The chain reaction will spread further than the assets themselves. Companies in all industries can pass these benefits on to their employees, customers and even the environment by making operations safer, smarter and eco-friendly.

Patrick Zirnhelt is responsible for IFS’s presence in enterprise asset management (EAM) software in North America. He has more than 22 years of experience working with enterprise systems, which includes software development, implementation and sales.