Asset management comes to North America
The construction industry is moving towards a more integrated approach.
Though this column primarily focuses on construction and its associated risks, I’ve been interweaving the concept of asset management into my articles over the past several years to highlight a profound shift within construction. Increasingly, the industry is opting for project delivery models that account for the total cost of ownership of an asset and attempt to improve communication between the design, construction and operations stakeholders.
Whether it’s public-private partnership models that award concessions to a special purpose vehicle to design-build-finance-operate-maintain an asset, or integrated project delivery models that create a collaborative environment, you can’t ignore the drive toward whole-life delivery models that go beyond the total cost of construction.
More and more asset owners are collaborating with key stakeholders related to the development and operations of their assets to better manage their investments – thus the rise of asset management.
A strong measure for the growth of asset management has been the expansion of asset management focused associations, conferences and events. Several of these associations and events seem to have got their start in Europe and parts of Australasia, and are now migrating to new regions, such as North America. The Institute of Asset Management (IAM), the Global Forum on Maintenance and Asset Management (GFMAM), the Asset Management Council (AMC), Energy & Utilities Alliance (EUA) and Maximo User Conferences are just a few of the prominent examples.
We’ve also seen growth in North American-focused asset management associations like the Society for Maintenance & Reliability Professionals (SMRP), the Plant Engineering and Maintenance Association of Canada (PEMAC), the Canadian Network of Asset Managers (CNAM), and several asset-specific associations like the Water Environment Federation (WEF).
The spotlight on asset management continues to grow, driven by the launch of the ISO 55000 asset management standard in 2014 and advances in technology integration into physical assets, such as IoT, machine learning and digital twin technology. The emerging interest in asset management seems to be a driving force behind the desire for new delivery models that contemplate more collaboration with all asset stakeholders.
As further evidence of this growth in Asset Management globally and in North America in particular, IAM is launching its inaugural North American Conference, taking place from October 1st to 3rd in Chicago. I am fortunate enough to be the co-chair of this event and look forward to helping the North American market place learn more about the trends and thought leadership related to asset management. Hope to see you there!
I’ve spent quite a bit of time hanging out with leaders of the global asset management community over the past 10 years. These people are dedicated professionals with one simple goal in mind: to optimize the balance between cost, performance and risk as it relates to their organizations’ portfolio of assets. A truly noble cause as I can attest based on the data of the insurance sector that improperly constructed, operated and maintained assets are the cause of many losses suffered by the insurance sector. Further, the cost to society of improperly constructed and operated assets is truly epic in size, amounting to trillions of dollars.
Still, one thing I’ve noticed about the global asset management community is the lack of participation from the construction community.
There are representatives from the design community, however, I fail to see any meaningful participation from the construction sector, namely from main contractors and subcontractors. This has always puzzled me, as it is the construction sector that transforms design into operational asset reality. How can such an important role within the asset’s life not be more involved in discussions related to optimizing asset performance?
If there’s one piece of advice I can to leave with both the construction community and the asset management community, it’s to get to know each other on a much deeper level.
Perhaps this IAM conference is an ideal venue for construction stakeholders to learn more about asset management, and for asset managers to get to know the trials and tribulations of the construction sector. I have no doubt deeper collaboration between these two groups will lead to better assets, as well as a better economy.
This column first appeared in the April 2019 issue of On-Site. You can read through the full issue here.
David Bowcott is Global Director – Growth, Innovation & Insight, Global Construction and Infrastructure Group at Aon Risk Solutions. Please send comments to email@example.com.