The professional body for whole life management of physical assets

Definitions

 

This Glossary does not include all terms used within the Anatomy. Some terms are explained in the body of the text.

ISO 55000 contains definitions for some terms relating to asset management. A number of these are included in this Glossary, as the definitions and their associated notes aid understanding (where more clarification is provided than within the Anatomy).

  

asset

Item, thing or entity that has potential or actual value to an organization. Notes:

(1)   Value can be tangible or intangible, financial or non-financial, and includes consideration of risks and liabilities. It can be positive or negative at different stages of the asset life.

(2)   Physical assets usually refer to equipment, inventory and properties owned by the organization. Physical assets are the opposite of intangible assets, which

are non-physical assets such as leases, brands, digital assets, use rights, licences, intellectual property rights, reputation or agreements.

(3)   A grouping of assets referred to as an asset system could also be considered as an asset.

ISO 55000:2014

(3.2.1)

asset life

period from asset creation to asset end-of-life

ISO 55000:2014

(3.2.2)

asset management

Coordinated activity of an organization to realize value from assets. Notes:

1.  Realization of value will normally involve a balancing of costs, risks, opportunities and performance benefits.

2.  Activity can also refer to the application of the elements of the asset management  system.

3.  The term “activity” has a broad meaning and can include, for example, the approach, the planning, the plans and their   implementation.

ISO 55000:2014

(3.3.1)

asset management plan

Documented information that specifies the activities,

resources and timescales required for an individual asset, or a grouping of assets, to achieve the organization’s asset management objectives.

Notes:

(1)   The grouping of assets may be by asset type, asset class, asset system or

asset portfolio.

(2)   An asset management plan is derived from  the

strategic asset management plan.

(3)   An asset management plan may be contained in, or may be a subsidiary plan of, the  strategic

asset management plan.

ISO 55000:2014

(3.3.3)

asset management system

Management system for asset management whose

function is to establish the asset management policy and asset management

objectives.

Note: The asset management system is a subset of asset  management.

ISO 55000:2014

(3.4.3)

asset

long-term optimized approach to management of the assets, derived from, and

PAS 55-1:2008

management

consistent with, the organizational strategic plan and the asset management policy

(3.9)

strategy

Notes:

 

 

(1) The asset management strategy converts the objectives of the organizational

 

(also refer to

strategic plan and the asset management policy into a high-level, long-term action

 

definition for

plan for the assets and/or asset system(s), the asset portfolios and/or the asset

 

the SAMP)

management system.

 

 

(2) The high-level, long-term action plans for the assets and the asset management

 

 

objectives are normally the outputs of the asset management strategy. These

 

 

elements together form the basis for developing more specific and detailed asset

 

 

management plan(s).

 

asset portfolio

Assets that are within the scope of the asset management system.

Notes:

(1)   A portfolio is typically established and assigned for managerial control purposes. Portfolios for physical hardware might be defined by category (e.g. plant, equipment, tools, land). Software portfolios might be defined by software publisher, or by platform (e.g. PC, server, mainframe).

(2)   An asset management system can encompass multiple asset portfolios. Where multiple asset portfolios and asset management systems are employed, asset management activities should be coordinated between the portfolios and systems.

ISO 55000:2014

(3.2.5)

asset system

Set of assets that interact or are interrelated.

ISO 55000:2014

(3.2.6)

asset type

grouping of assets having common characteristics that distinguish those assets as a group or class

EXAMPLE Physical assets, information assets, intangible assets, critical assets, enabling assets, linear assets, information and communications technology (ICT) assets, infrastructure assets, moveable assets.

ISO 55000:2014

(3.2.7)

capability

<asset management> measure of capacity and the ability of an entity (system, person or organization) to achieve its objectives

Note:

Asset management capabilities include processes, resources, competences and technologies to enable the effective and efficient development and delivery of asset management plans and asset life activities, and their continual improvement.

ISO 55000:2014

(3.1.2)

competence

ability to apply knowledge and skills to achieve intended results

ISO 55000:2014

(3.1.3)

critical asset

asset having potential to significantly impact on the achievement of the

organization’s objectives

Notes:

(1)   Assets can be safety-critical, environment-critical or performance-critical and can relate to legal, regulatory or statutory requirements.

(2)   Critical assets can refer to those assets necessary to provide services to critical customers.

(3)   Asset systems can be distinguished as being critical in a similar manner to individual assets.

ISO 55000:2014

(3.2.8)

effectiveness

extent to which planned activities are realized and planned results achieved

ISO 55000:2014

(3.1.7)

FMEA

Failure  Mode  and  Effects  Analysis A step-by-step approach for identifying potential failures of an asset, or process, and analysing the consequences of the failures.

ISO 55000:2014

(3.2.6)

GAAP

Generally Accepted Accounting Principles.

A set of rules, conventions, standards, and procedures for reporting financial information, as established by the US Financial Accounting Standards Board (FASB).

 

IFRS

International Financial Reporting Standards.

Guidelines and rules set by the International Accounting Standards Board (IASB) that companies and organizations can follow when compiling financial statements. The creation of international standards allows investors, organizations and governments to compare the IFRS-supported financial statements. All listed EU companies have been required to use IFRS since 2005.

http://www.ifrs.org

incident

unplanned event or occurrence resulting in damage or other loss

ISO 55000:2014

(3.1.8)

level of service

parameters, or combination of parameters, which reflect social, political, environmental and economic outcomes that the organization delivers Note:

The parameters can include safety, customer satisfaction, quality, quantity, capacity, reliability, responsiveness, environmental acceptability, cost and availability.

ISO 55000:2014

(3.3.6)

management system

set of interrelated or interacting elements of an organization to establish

policies and objectives and processes to achieve those objectives

Notes:

(1)   A management system can address a single discipline or several disciplines.

(2)   The system elements include the organization’s structure, roles and responsibilities, planning, operation,   etc.

(3) The scope of a management system may include the whole of the organization, specific and identified functions of the organization, specific and identified sections of the organization, or one or more functions across a group of organizations.

ISO 55000:2014

(3.4.2)

monitoring

determining the status of a system, a process or an activity Notes:

(1)   To determine the status, there may be a need to check, supervise or critically observe.

(2)   For the purposes of asset management, monitoring may also refer to determining the status of an asset. This is typically referred to as “condition monitoring” or “performance monitoring”.

ISO 55000:2014

(3.1.9)

objective

Result to be achieved.

Notes:

(1)   An objective can be strategic, tactical or operational.

(2)   Objectives can relate to different disciplines (such as financial, health and safety, and environmental goals) and can apply at different levels (such as strategic, organization-wide, project, product and process).

(3)   An objective can be expressed in other ways, eg as an intended outcome, a purpose, an operational criterion, an asset management objective or by the use of other words with similar meaning (e.g. aim, goal, or target).

(4)   In the context of asset management systems, asset management objectives are set by the organization, consistent with the organizational objectives and asset management policy, to achieve specific measurable results.

ISO 55000:2014

(3.1.12)

optimize

Achieve by a quantitative or qualitative method, as appropriate, the best value compromise between conflicting factors such as performance, costs and retained risk within any non-negotiable constraints.

PAS 55-1:2008

(3.23)

organizational (strategic) plan

documented information that specifies the programmes to achieve the organizational objectives

Notes:

(1)   ISO 55000 uses the term organizational plan

(2)   PAS 55 uses the term organizational strategic plan (OSP).

(3)   The terms mean the same. This term OSP is used in places in the Anatomy and other documentation produced by the IAM.

ISO 55000:2014

(3.1.15)

organizational objective

overarching objective that sets the context and direction for an organization’s

activities

Note:

Organizational objectives are established through the strategic level planning activities of the  organization.

ISO 55000:2014

(3.1.14)

outsource

make an arrangement where an external organization performs part of an organization’s function or process

Note:

An external organization is outside the scope of the management system, although the outsourced function or process is within the scope if its activities influence the effectiveness of the asset management system.

ISO 55000:2014

(3.1.16)

performance

measureable result

Notes:

(1)   Performance can relate either to quantitative or qualitative findings.

(2)   Performance can relate to the management of activities, processes, products (including services), systems or  organizations.

(3)   For the purposes of asset management, performance can relate to assets

in their ability to fulfil requirements or objectives.

ISO 55000:2014

(3.1.17)

policy

intentions and direction of an organization as formally expressed by its top management

ISO 55000:2014

(3.1.18)

process safety

Process Safety is a blend of engineering and management skills focused on preventing catastrophic accidents, particularly explosions, fires, and toxic releases, associated with the use of chemicals and petroleum products.

Centre for Chemical Process Safety (American Institute of

Chemical  Engineers)

project

There are 2 commonly used definitions for a  project:

Unique process consisting of a set of co-ordinated and controlled activities with start and finish dates, undertaken to achieve an objective conforming to specific requirements, including constraints of time, cost and resources.

ISO 10006:2003

(3.5)

A temporary endeavour undertaken to create a unique product or service.

Project Management Institute (PM Body of Knowledge, Section 1.2)

Property, Plant and Equipment

According to International Accounting Standard 16 (IAS16), “Property, Plant and Equipment” comprise tangible assets held by an entity for use in the production or supply of goods or services, for rental to others, of for administrative purposes that are expected to be used for more than one period. Depending on the applicable financial reporting framework, another definition of “Property, Plant and Equipment” might be appropriate.

International Accounting Standard 16 (IAS16)

risk

Effect of uncertainty on objectives.

Notes:

(1)   An effect is a deviation from the expected – positive and/or   negative.

(2)   Objectives can relate to different disciplines (such as financial, health and safety, and environmental goals) and can apply at different levels (such as strategic, organization-wide, project, product and process).

(3)   Risk is often characterized by reference to potential “events” (as defined in ISO Guide 73:2009, 3.5.1.3) and “consequences” (as defined in ISO Guide 73:2009, 3.6.1.3), or a combination of these.

(4)   Risk is often expressed in terms of a combination of the consequences of an event (including changes in circumstances) and the associated “likelihood” (ISO Guide 73:2009, 3.6.1.1) of occurrence.

(5)   Uncertainty is the state, even partial, of deficiency of information related to, understanding or knowledge of, an event, its consequence, or likelihood.

ISO Guide 73:2009

(1.1)

stakeholder

person or organization that can affect, be affected by, or perceive themselves to be affected by a decision or activity

Note:

A “stakeholder” can also be referred to as an “interested party”.

ISO 55000:2014

(3.1.22)

strategic

documented information that specifies how organizational objectives are to

ISO 55000:2014

asset

be converted into asset management objectives, the approach for developing

(3.3.2)

management

asset management plans, and the role of the asset management system in

 

plan (SAMP)

supporting achievement of the asset management objectives

 

 

Notes:

 

(also refer

(1) A strategic asset management plan is derived from the organizational

 

to definition

(strategic) plan.

 

for asset

(2) A strategic asset management plan may be contained in, or may be a

 

management

subsidiary plan of, the organizational plan.

 

strategy)

 

 

Sustainable

Achieving or retaining an optimum compromise between performance, costs and risks over the Life Cycle, whilst avoiding adverse long-term impacts to the organization from short-term decisions.

PAS 55-1:2008

(3.32)

value chain

“a set of activities that an organization carries out to create value for its

Porter, Michael E.,

 

customers”

“Competitive

 

 

Advantage:

 

 

Creating and

 

 

Sustaining Superior

 

 

Performance“.

 

 

1985

 

 


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