What is Asset Performance Management? A Detailed Guide

Asset Performance Management (APM) is a way to make smart decisions about managing your assets. It focuses on making assets work better and last longer while also reducing any downtime. In this blog, we’ll explore how APM functions and how you can apply it in your facility. Let’s dive right in!

What is Asset Performance Management (APM)?

Asset Performance Management (APM) is a method companies use to take care of the important assets they rely on for daily operations. This includes things like buildings, machines, vehicles, software, and other technology. APM helps businesses make sure these assets are performing at their best.

The best APM systems mix software tools with good asset management practices to improve how well assets work and how long they last. It can be used for everything from a modern office building to a group of delivery trucks.

With features like predictive maintenance, advanced analytics, and remote monitoring, APM helps reduce the chances of equipment breaking down, making assets more reliable, and extending their use without adding extra costs.

Who uses Asset Performance Management?

Many types of organizations and industries make use of asset performance management (APM) solutions to keep track of and improve how their assets are managed. These include:

• Manufacturing companies
• Service-based businesses
• Government offices and departments
• Contractors in different fields
• Energy companies
• Utility services (electricity, gas, etc.)
• Railroads and public transportation
• Property developers
• Building owners and managers
• Hospitals and healthcare providers

Each of these sectors relies on APM solutions to maintain assets efficiently and ensure smooth operations.

What’s the difference between ALM and APM?

Asset Lifecycle Management (ALM) refers to the process that organizations use to manage their assets throughout their entire life. This includes everything from planning the asset, using it, and eventually decommissioning or retiring it. The goal is to keep assets functioning well at every stage.

On the other hand, Asset Performance Management (APM) focuses specifically on how assets perform while they’re being used. It’s a strategy that helps businesses get the most out of their assets during the time they’re in operation.

While both ALM and APM are about taking care of assets, ALM covers the full life of the asset from start to finish, while APM is more concerned with how well the asset performs during its use.

The Benefits of APM

1. Reducing Unplanned Maintenance

   When companies keep a close eye on how their main assets are performing, they can lower their operating costs and cut down on unexpected equipment breakdowns. By using preventive and predictive maintenance techniques, they get a better idea of when things need fixing and can plan repairs at convenient times, instead of dealing with surprise failures.

2. Lower Maintenance Costs

   Maintenance is important for keeping assets running well, but it can sometimes become expensive and affect the company’s profits. With better decision-making from an Asset Performance Management (APM) system, businesses can avoid doing unnecessary maintenance and only focus on what’s needed.

3. Improvements in Asset Uptime

   With the help of artificial intelligence (AI) and machine learning (ML), modern Asset Performance Management (APM) systems now offer better ways to handle predictive and preventive maintenance. These technologies help operators spot potential issues earlier, making it easier to suggest repairs before major breakdowns happen. This leads to less downtime for important equipment, keeping assets running smoothly for longer periods.

4. Greater Operational Efficiency

   Many companies that rely heavily on equipment are now using AI and Internet of Things (IoT) technologies as part of their APM approach. These tools allow them to identify ways to work more efficiently. Instead of waiting for monthly or quarterly reports, managers can now access performance data in real time. A 2022 study showed that over half of the organizations surveyed are focusing on boosting operational efficiency as a top priority.

5. Improved Safety and Compliance

   Asset Performance Management (APM) helps ensure that equipment and assets are functioning safely. This allows organizations to meet safety regulations and standards set by authorities. By keeping operations within safe limits, companies can avoid potential risks and maintain compliance with laws.

6. Informed Decision Making

   APM also focuses on using data to guide decisions. By analyzing information, it provides valuable insights that help organizations make smart choices about how to use their resources effectively. This data-driven approach leads to better planning and more efficient operations.

Steps Involved in Asset Performance Management

Here are seven steps to kick off your Asset Performance Management (APM) program:

1. Collect Data: Start by gathering data from different places. This includes information from sensors, SCADA systems, maintenance logs, and records.
2. Combine Data: Bring together the data from various systems into one platform. This helps ensure that the information can flow easily and be analyzed together.
3. Analyze Data: Use smart analysis methods like machine learning and statistical models to dig deep into the data. This can help you uncover important trends and insights.
4. Monitor Asset Health: Keep an eye on how your assets are doing in real-time. Use techniques like vibration analysis, thermography, and oil analysis to check their condition.
5. Plan Predictive Maintenance: Use the insights from your analysis to predict when an asset might fail. This allows you to schedule maintenance before any issues arise.
6. Optimize Performance: Regularly review the performance data of your assets. Look for ways to improve their efficiency and make any necessary changes.
7. Support Decisions: Use the information you’ve gathered and analyzed to help make smart choices about maintenance plans, how to use resources, and manage the lifespan of your assets.

By following these steps, you can set up a successful APM program that keeps your assets running smoothly.

How to Build an Effective APM Program

1. Identify Your Most Important Assets

   When it comes to managing your assets, it all starts at the planning stage of their lifecycle. Before acquiring any asset, decision-makers need to consider how it will fit into their overall operations. This means they need to evaluate the asset’s value based on how crucial it is to their business.

   The way an asset is valued can differ widely depending on the type of business and industry. For instance, in a food delivery service, the condition and performance of the delivery vehicles are extremely important.

   On the other hand, a software company may own vehicles, but their condition won’t significantly affect daily operations. This shows that the same asset can hold different importance depending on the business context. Therefore, when starting your Asset Performance Management (APM) strategy, focus on the assets that are most critical to your operations first. You can take care of the less important assets later on.

   One useful approach in APM is creating a digital twin. This is a virtual model of an asset that helps operators run tests and predict how it will perform under different conditions. By using a digital twin, decision-makers can get a clear idea of how well an asset is likely to function in real-world scenarios. This tool allows maintenance leaders to identify performance problems early on and find ways to improve maintenance strategies.

2. Use APM Softwares that come with Condition Monitoring Features

   Deploying asset performance management (APM) software with condition monitoring features is essential for keeping track of how well your assets are performing and automating important asset-related tasks. APM software, like enterprise asset management (EAM) systems, combines tools and services that help organizations effectively manage, maintain, and improve their operational assets.

   With the increase in data generated from the Internet of Things (IoT), maintenance managers are turning to management software such as EAM. These systems often use AI to analyze data, which allows managers to make better-informed decisions.

   In addition to EAM, many APM projects include a computerized maintenance management system (CMMS) Software. A CMMS helps maintenance teams centralize important asset information. It provides details on where each asset is located, what services or repairs are needed, and who is responsible for those tasks. A well-functioning CMMS makes it easy for operators to access and review crucial asset information when they need it.

3. Using Preventive and Predictive Maintenance Strategies

   Today, the most effective Asset Performance Management (APM) strategies focus on regularly scheduling preventive maintenance to avoid equipment failures and continuously monitoring performance in real-time. Two important approaches in this area are preventive and predictive maintenance.

   Preventive maintenance involves setting up regular maintenance activities to help prevent breakdowns. By following best practices and looking at past performance data—like the average time between failures—teams can plan for necessary downtime before issues occur.

   Predictive maintenance, on the other hand, continuously monitors an asset’s condition through sensors that gather real-time data. This information is then processed using AI-enabled Enterprise Asset Management (EAM) or Computerized Maintenance Management Systems (CMMS). Advanced data analysis techniques, including machine learning, are applied to identify and address potential problems as they arise.

   With this data and analysis, algorithms create models that forecast when future issues might happen with a piece of equipment. Predictive maintenance has been shown to significantly cut maintenance costs, reduce equipment downtime by 35-50%, and extend asset life by 20-40%.

Measuring the Success of Your APM Program

To determine if your APM strategy is useful, it’s essential to choose the right success metrics. Key Performance Indicators (KPIs) help you assess whether your strategy is working and show business leaders how their decisions impact performance. Picking the wrong metrics can lead to misunderstandings about how well assets are performing, potentially resulting in poor decisions that could harm the business in the long run.

Several factors can influence how you identify these performance metrics. These include the industry you’re in, the size of your organization, the types of assets you manage, and your overall business goals. Here are a few common methods used to evaluate the success of APM initiatives:

1. Mean Time Between Failures (MTBF)

   One of the most popular metrics for assessing the effectiveness of a maintenance program is the Mean Time Between Failures (MTBF). This metric measures the average time between equipment failures. You calculate it by dividing the total operational time by the number of failures during that time. A high MTBF usually indicates a strong maintenance department.

2. Overall Equipment Effectiveness (OEE)

   Another well-known metric is Overall Equipment Effectiveness (OEE). This measures how well an asset is performing based on three key areas: availability, performance, and quality.

   • Availability compares the actual production time of the asset to its planned production time.
   • Performance looks at how well the equipment operates compared to its maximum capability.
   • Quality assesses the proportion of products produced that meet quality standards versus those that have defects.

   To find the OEE score, you multiply these three components together.

3. Work Order Efficiency and Completion Rate

   Two other important metrics involve looking at how quickly maintenance teams can close out work orders and the percentage of tasks completed versus those that remain unfinished. These metrics help evaluate the effectiveness and responsiveness of the maintenance team.

4. Emergency Maintenance Frequency

   Finally, tracking how often emergency maintenance tasks are required can provide valuable insight into your preventive maintenance program. If your maintenance team is doing a good job with preventive maintenance, you should see fewer unexpected breakdowns that need urgent fixes.

   By using these methods, you can gain a clearer picture of how your APM program is performing and make informed decisions for future improvements.

Closing Thoughts

Asset Performance Management (APM) plays a crucial role in optimizing asset use and longevity. By implementing APM strategies, organizations can reduce downtime, lower maintenance costs, and enhance overall operational efficiency. With the right tools and approaches, businesses can make informed decisions that lead to better asset performance and sustainability. Embracing APM is a step towards smarter asset management and improved productivity.