Asset Management Plan – Definition, Objectives, Strategy, Framework, Template

Wikipedia of Finance - Asset Management Plan Framework, Definition, Objectives, Strategy, Template, Sample and Example

Asset Management Plan Definition:

A tactical plan rendered for managing firm’s infrastructure along with other financial assets to ensure delivery of agreed standard of services is known as an asset management plan (AMP). Typically, more than one asset is covered under an asset management plan and it follows a system approach – especially where a number of assets are reliant and are obligatory to work mutually to deliver an agreed standard of service.

The International Infrastructure Management Manual has defined an asset management plan as, “A plan developed for the management of one, two or any number of infrastructure assets that combines multi-disciplinary management techniques (including technical & financial) over the life cycle of the asset in the most cost effective way to ensure a specific level of service.”

Key Goals and Objectives of Asset Management Plan:

Normally there are two major asset management objectives of an asset management plan.

1. Justification – To provide visibility of the costs and advantages linked with providing the agreed standard of service.

2. Optimization – To reduce the whole-life cost, that involves the operation, replacement and maintenance or disposal of each asset in the system.

What we must understand here, is that for either of the above to work, the Standard of Service needs to be defined clearly for each and every asset in an asset system and in a measureable way.

The achievement of first objective is essential before the decentralization of decision-making around maintenance and replacement can really happen, and it is relatively quicker. However, accomplishing optimization demands ongoing work in local teams, together with enhanced supervision from the center.

An asset management plans (AMPs) ought to take a “horses for courses” approach – not a one size fits all, but needs based – considering the fundamental information required. Beyond this, it should be fabricated upon by the local asset manager taking under account the local requirements. An effusively developed Asset Management approach typically requires a number of iterations of the asset management plan, and needs to be reviewed more often for relatively more complex systems, especially asset systems where the average annual cost needed to proffer the agreed standard of service is high.

Asset Management Strategy:

One of the phase important in asset management planning is to build asset management strategy. This is a high level strategic document that provides guidelines for the overall asset management activities of the company or an organization. Asset management strategy will be linked to different plans to deliver the goals and objectives of management planning like:

  • Asset Management Plans.
  • Asset Management Policy.
  • Long Term Financial Plan.
  • Asset Management Improvement Plan.
  • Social & Community Plan.
  • Community Engagement Plan.
  • Environmental Management Plan.

Asset Management Plan Framework:

To manage assets effectively and sustainably, it’s mandatory to follow the asset management plan framework structure. Let us briefly understand the phases involved of asset management framework:

Phase-1: Develop an effective Asset Management Policy.

Phase-2: Develop an Asset Management Strategy which covers following points:

  • Prepare an Asset Management Plans for different asset classes.
  • Prepare the various processes that are linked to Asset Management Plans with Long Term Financial Plans.
  • Defined service-level and affordability to the best of the industry.
  • Set governance processes and management arrangements.
  • Set the process for data and systems which need to be integrated to provide support to asset management.
  • Build a process for improvement of skills and various other processes.

Phase-3: Develop an evaluating process with respect to asset management plans, processes, skills, governance and asset sustainability.

  • Link asset management with annual report of the company / organization.

Asset Management Plan Framework is been developed in such a way that it does not prescribe a single methodology, or restrict the processes that are currently followed to achieve these asset management goals and objectives. Asset management practices, processes, goals and objectives can be enhanced through various range of improvement towards asset management strategy.

Asset Management Plan Template:

Correct measures taken by any management is the key towards growth of a company or an organization. Here is the sample format template as well as example of asset management plan. You can download the file for the link: Asset Management Plan.pdf

Asset Management Plan template in doc format:

You can also download asset management plan template in doc format for the link given below. You can reuse this format template for your company project.

Asset Management Plan Template.docx

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