How Does ISO 55000 Define Assets? ISO 55000 is intended to manage physical assets, but to achieve the greatest return on investment, it can be applied to all types of assets and all types and sizes of businesses.
In the Unified theory of business these include Physical assets and financial assets. Assets form an important focus for all organizations. Other items to consider adding to your list are; intellectual property, patents, leases, drawing, Investments and record control.
The type of business you are in and the expectation of the organization stakeholders will direct you to how assets are defines. ISO 55000 should define assets as items, things or entities that have value or the potential to create value to an organization. An asset can be tangible or intangible, financial or non-financial.
What is ISO 55000?
ISO 55000 refers to a set of international standards that describes a management system of assets. These set of standards were released on January, 2014. The standards have been developed by ISO Project Committee 251 (PC251). ISO 55000 focuses on management of business assets. The ISO 55000 series comprises of three components;
- The Why, ISO 55000 Overview, Principles and Terminology.
- The What, ISO 55001 Management Systems – Requirements.
- The How, ISO 55002 Management Systems – Guidelines on the Application
ISO 55000 gives an overview of the management of assets and also provides in detail, the principles, subject matter, introduction and key terminologies of assets management. ISO 55001 specifies the requirements needed for an integrated, effective management system of assets management. ISO 55002 provides additional useful guidance on interpretation and implementation of assets management.
According to ISO 55000, asset management refers to the coordination of activity of an organization to realize full value from assets. Asset Management involves the balancing of costs, opportunities and risks against the desired performance of assets that is required to achieve the organizational objectives. This balancing of costs and opportunities should be considered over different time frames.
Asset management, according to ISO 55000, enables organizations to examine the need for, and performance of, assets and asset systems at different levels. Additionally, it may enable the application of various analytical approaches towards managing of assets over the different stages of its life cycle which normally start with the conception of the need for the asset, through to its disposal, and incorporates the management of any potential post disposal liabilities.
Asset Management refers to the art and science of making the right decisions and optimizing the delivery of service value. A common objective of asset management is to minimize the whole life cost of all assets but also, there may be other factors such as risks or business continuity that requires serious consideration in making decisions.
Another definition of asset management is the management of the investments of clients by financial services companies, which are mostly investment banks. The companies invest on behalf of their clients and then give them access to a wide customer base.
Asset management also refers to the professional management of various investments such as stocks, bonds and real estate businesses. Usually, this is mostly practiced as the services of a professional firm. A number of professional firms and also investment banks offer asset management services, which are often handled by a team of highly qualified financial professionals for the best results.
Assets is the account at a financial institution includes checking services, credit cards services, debit cards, margin loans, the automatic sweep of cash balances into the money market fund, as well as brokerage services.
If handled properly the “Unified theory of business assets” will be an opportunity for the leadership of the organization to be the guiding force in the vision of risk to reward decisions.
Randy W. Rapin has worked in design and process manufacturability since 1965. Randy founded RLT Industries in Dayton, Ohio in 1995 with focus on Bio-Mechanical design. RLT Industries offers design and process manufacturability services to the orthopaedic and automotive industry. Randy has extensive experience in metal, plastics and rubber component design. Randy now offers biomechanical design and engineering support to the orthopaedic industry, with a current focus on spinal implants. RLTGold, a division of RLT Industries, opened in 2015 for the implementation and training of ISO 55000. Mr. Rapin can be reached by email.