A Primer on
Facility Asset Management
Presenter
Bill Faesenmeier
Facilities Asset Management Product Manager
24 years experience in Consulting Engineering industry
Areas of Specialization
> Facilities Engineering, Facilities Asset Management
> Facility condition assessments, asbestos and lead-based paint consulting, ADA surveys, environmental site assessments, industrial hygiene, indoor air quality, construction lender representation services, code compliance reviews
> Information management systems, software design
10 years experience in Architecture, Real Estate Development and Construction Management
Today’s Agenda
Data Sources
Definitions
Supporting Software
Focus on Facility and Space Management Tools
Value of a CPMS
Q&A
DEFINING & EXPLAINING
TERMS &
What is Facility Asset
Management?
What is Facility Asset
Management?
What is Facility Asset
Management?
Definition:
Facility Asset Management
fa·cil·i·ty -
something designed, built, installed, etc., to serve a specific function affording a
convenience or service: transportation facilities; educational facilities; a new research
facility
as·set -
a useful and desirable thing or quality. An item of ownership convertible into cash;
total resources of a person or business, as cash, notes and accounts receivable, securities,
inventories, goodwill, fixtures, machinery, or real estate (opposed to liabilities)
man·age·ment -
the act or manner of managing
man·age -
to take charge or care of
Definition:
Facility Asset Management
man·age -
to take charge or care of
fa·cil·i·ty -
something designed,
built
, installed, etc., to serve a specific function affording a
convenience or service: transportation facilities; educational facilities; a new research
facility
as·set -
a useful and desirable thing or quality. An item of ownership convertible into cash;
total resources of a person or business, as cash, notes and accounts receivable, securities,
inventories, goodwill, fixtures, machinery, or
real estate
(opposed to liabilities)
Asset management….
refers to any system that monitors
and maintains things of value to an entity or group
“Too Broad”
Wikipedia
“Asset management is a systematic process of maintaining, upgrading, and operating physical assets cost-effectively.
It combines engineering principles with sound business practices and economic theory, and it provides tools to facilitate a more organized, logical approach to decision-making.
Thus, asset management provides a framework for handling both short- and long-range planning.”
Asset Management: Advancing the State of the Art Into the 21stCentury Through Public-Private Dialogue, FHWA and AASHTO, 1996
“Asset management is………..a methodology needed by those
who are responsible for efficiently allocating generally
insufficient funds amongst valid and competing needs.”
The American Public Works Association Asset Management Task Force
Enterprise asset management
is the business processes and enabling information systems that support management of an organization's assets, both physical assets, called "tangible", and non-physical, "intangible" assets.Not bad…..
but still too broad…..
and we don’t deal with intangible assets.
Wikipedia
Infrastructure asset management is the combination of management, financial, economic, engineering, and other practices applied to physical assets with the objective of providing the required level of service in the most cost-effective manner.
It includes the management of the whole life cycle (design, construction, commissioning, operating, maintaining, repairing, modifying, replacing and decommissioning/disposal) of physical and infrastructure assets.[1]
Operating and sustainment of assets in a constrained budget environment require some sort of prioritization scheme.[2]
[1] Local Government and Municipal Knowledge Base [2] Wikipedia
Public asset management
(also referred to as corporate asset
management) expands the definition of enterprise asset
management (EAM) by incorporating the management of all things
of value to a municipal jurisdiction and its citizens' expectations
Again……….
primarily speaks to public sector, utilities, property
and transport systems
Customer focused
Mission driven
System oriented
Long-term in outlook
Accessible and user friendly
Flexible
U.S. Department of Transportation Federal Highway Administration Office of Asset Management, 1999
Desirable Features
of an Asset Management Program
Strategic goals
Inventory of assets (physical and
human resources)
Valuation of assets
Quantitative condition and
performance measures
Measures of how well strategic
goals are being met
Usage information
Performance-prediction capabilities
Relational databases to integrate
individual management systems
Consideration of qualitative issues
Links to the budget process
Engineering and economic
analysis tools
Useful outputs, effectively presented
Continuous feedback procedures
U.S. Department of Transportation Federal Highway Administration Office of Asset Management, 1999
0010110010100101010101010100010101010110101110101010101
1101001001011001001101010101010101010010110010100101011
0101001011000101010101001011001010010101101010010110001
0100101100101001010101010101000101010101101011101010101
0111010010010110010011010101010101010100101100101001010
1101010010110001010101010010110010100101011010100101100
0101000101100101001010101010101000101010101101011101010
1010111010010010110010011010101010101010100101100101001
0101101010010110001010101010010110010100101011010100101
1000101001011001010010101010101010001010101011010111010
1010101110100100101100100110101010101010101001011001010
0101011010100101100010101010100101100101001010110101001
Supporting
Software
Facility Asset Management Software
The search for “facility asset management software” returned over
4.8 million results
.
Not as many results as “facility asset management”, but quite large.
This is where it gets confusing…..and perhaps on purpose.
Facility Condition Assessment Software
Over 5.1 million results
…..and the first entry is not specifically a Facility
Condition Assessment product.
Facilities Condition Assessment Software
Over 5.8 million results
Asset Lifecycle Model
for Total Cost of Ownership
B
uilding
I
nformation
M
anagement
F
ramework
Integrated Work
Management System
IWMS
Real Estate & Lease Management Project Management Facilities & Space Management Maintenance Management Sustainability & Energy Management REPM ELMS IPD CAFM CAD BIM CMMS CPMS JOC EHS BMP EPP EAM EMS
Real Estate and Lease Management
(examples AppFolio, Buildium, Property Matrix, ProLease)
Lease Analysis, Administration and Accounting
Site Selection & Site Management
Strategic Planning
RFP Analysis
Portfolio Management
Transaction Management
Tax Management
Broker Transaction Management
(Capital) Project Management
(examples Microsoft Project, Primavera, Prolog, Eclipse)
Capital Planning
Funding
Design (new facilities, expansions, remodeling)
Bidding
Procurement
Cost and Resource Management
Project Documentation and Drawing Management
Scheduling
Critical Path Analysis
Facilities and Space Management
The International Facility Management Association (IFMA) defines
facility management as the “practice of coordinating the physical
workplace with the people and work of the organization.”
CAFM
CAD
BIM
CPMS
Computerized Maintenance Management System
(examples: MAXIMO, MicroMain, Datastream 7i)
Asset Management
Work Requests and Work Order Administration
Preventative Maintenance
Unscheduled Maintenance
Warranty Compliance and Administration
Maintenance Scheduling
Inventory Management and Purchasing
Vendor Management
Facility Condition Monitoring
Sustainability and Energy Management Systems
(examples: EnergyCAP, INTELEX, e3EIM, Sustainability Cloud)
Energy Consumption
Water Consumption
Waste Production
GHG Emissions
Sustainability Performance Metrics
Energy Benchmarking
BMS Integration
Carbon Emissions Tracking
Energy Efficiency Project Analysis
Environmental Sustainability and Compliance
Energy Efficiency
Waste Management
Nonrenewable Minerals Consumption
Renewable Groundwater Supplies
Pollution Absorption
Recycling
Carbon Credit Calculation
Certification
Employee At-Home Working FacilitationFOCUS
AND
Space Management
Computer Aided Facilities Management (CAFM)
(examples: Archibus, Aperture Technologies, FM Systems)
•
Asset Management•
Space Management•
Room Booking•
Move Management•
Strategic Planning•
Telecommunications Cable Management•
Physical Security Administration•
CAD and BIM IntegrationCAD (Computer Aided Design)
(examples
: AutoCAD, Microstation, InfraWorks 360, TurboCAD
)
•
Building Design
•
Infrastructure Design
•
Plant Design
•
Product Design
•
2D and 3D Modeling
•
Simulation
•
Rendering
BIM (Building Information Modeling)
(examples
: Autodesk Revit, ArchiCAD, Archibus EIM
)
•
Digital representation of physical and functional
characteristics of a facility
•
Building design extended beyond 3D
•
Integrates Time as the 4
thdimension
•
Integrates Costs as the 5
thdimension
•
Combination of “objects” that include their geometry,
relations and attributes
CPMS (Capital Planning and Management Systems)
(examples:xp
paragon
,BUILDER)
Systematic management process to plan and budget for known cyclic repair and replacement requirements that extend the life and retain the usable condition of facilities and systems.
Often called Capital Renewal.
Planned investment program that ensures that facilities will function at levels commensurate with the priorities and missions of an organization.
Included are major building and infrastructure systems and components that have a maintenance cycle in excess of one year.of a
Facility assets are reported to equal 25 to 40 percent of the value of any private sector business or public sector institution.
Typically tracked as an asset on the balance sheetbut
Until recently, less than 10% of these businesses and institutions “managed” these assets as they would other business assets, such as labor, equipment, or production processes.
Typically tracked as a cost item on the income statement
Capital and expense budgets often managed by different groups and funding decisions made independent of each otherHarvard University Study
The next “low hanging fruit” that provides business an opportunity to
reduce costs, and thus increase shareholder value, is Facility Asset
Management.
Over the past few years, there is an increased awareness of the
financial value of establishing and maintaining fact-based,
standardized facilities asset management programs.
With this awareness, we have seen an increased focus from providers
of facility condition assessment services, facilities consulting, and
computerized maintenance management and asset management
software programs.
If you……
Manage facilities like you manage your business, and
Convert facilities into financial terms
You will…..
Improve the condition of the assets, and
Reduce overall cost of facility ownership
“Recommended Strategies to improve asset management:
Establish uniform condition assessment criteria
Standardize criteria for inventory of property assets
Use of computerized inventory and cost databases
Standardize costing methods using a common metric
Adoption of a comprehensive, valid, engineering based assessment systemthat incorporates life-cycle planning into facilities maintenance”
Government Accounting Office, Sept. 1999
What do you own?
What is it worth?
What is the deferred maintenance?
What is its condition?
What is the remaining service life?
What do you fix first?
Why Industry Needs Asset Management Tools, Dr. D.J. Vanier, National Research Council Canada, 1999
....”annual budgets for maintenance and repair should be
set at 2% to 4% of the current replacement value (CRV) of
the constructed facilities…”
Federal Facilities Council, 1996
Example M&R Cost Analysis
Facility Type Area (SF) Cost/SF CRV Avg Life (yrs)
Office Building, 2-4 stories 1,000,000 $ 146.00 $ 146,000,000 58 Retail Store 1,000,000 $ 126.19 $ 126,190,000 50 Factory, 1 story 1,000,000 $ 114.55 $ 114,550,000 58 3,000,000 $ 386,740,000 55
Rate Costs
Annual M&R Spending 3.0% $ 11,602,200 Cost/SF $ 3.87
Average Lifespan (yrs) 55
Lifespan M&R Costs $ 638,121,000
FAM Costs
1st Year FCA Costs Cost Cost/Year Cost/SF/Year % of Annual M&R
Software (initial cost + 1 years maint) $ 37,500 $ 37,500 $ 0.013 0.32%
Assessments (Initial Assessment @10¢/SF) $ 300,000 $ 300,000 $ 0.100 2.59%
337,500
$ $ 337,500 $ 0.113 2.91%
5 Year FCA Costs Cost Cost/Year Cost/SF/Year % of Annual M&R
Software (initial cost + 5 years maint) $ 67,500 $ 13,500 $ 0.005 0.12%
Assessments (2 times over 5 years) $ 600,000 $ 120,000 $ 0.040 1.03%
667,500
$ $ 133,500 $ 0.045 1.15%
10 Year FCA Costs Cost Cost/Year Cost/SF/Year % of Annual M&R
Software (initial cost + 10 years maint) $ 105,000 $ 10,500 $ 0.004 0.09%
Assessments (3 times over 10 years) $ 900,000 $ 90,000 $ 0.030 0.78%
1,005,000
If you could extend the life of your portfolio only
one
year over
a ten year period……….
You would save $11.6 mil in M&R costs = Benefit
Cost total $1.0 mil over 10 years for FAM program = Cost
Return on Investment (10 years) = 1,054%
Return on Investment (55 Year Life) = 187%
With the knowledge gained from a FAM Program,
On a 3 MSF portfolio,
do you think you could maintain these facilities at the same level of service,
spending $3.83/SF vs $3.87/SF on M&R
over the next ten years?
Yes?
Then you implemented your FAM Program at no cost!
Questions? Comments?
Thank you for joining this presentation,
A Primer on Facility Asset Management
By
Bill Faesenmeier
Contact XP Solutions
Americas: +1 888 554 5022 [email protected]
Asia Pacific: +61 7 3310 2302 [email protected]
EMEA: +44 0 1635 582555 [email protected]
