Do You Have An Asset Management Strategy?
TCO (Total Cost of Ownership) has become a standard for measuring costs, making strategic decisions and comparing performance. It is important to put TCO practices in place that help you manage your assets effectively and strategically through a more holistic view of costs and performance to foster better decisions and more cost-effective outcomes from construction to operations and eventually disposal. To make TCO a success, you must have buy-in from your organization as well as the commitment to collect, record and utilize the data necessary to begin making data-driven decisions.
Organization Buy-In:
For many organizations, TCO has only been embraced by Facilities Management while other departments are driven by alternative metrics, objectives and expectations. For example, a procurement department might measure success by purchasing materials at the lowest cost, whereas TCO practices might incur higher initial costs in exchange for long-term lower life cycle costs. This disconnect between departments can hinder an organization's overall success.
This is why it's important that TCO be an organization wide practice serving as an extension of your standard management processes. It is vital to develop comprehensive cost and performance data in order to manage the facilities assets efficiently and effectively from a Return on Investment (ROI) standpoint.
Collecting and Utilizing Data:
Once your team is completely on board, it is important to capture data. This will help you plan for and prevent unforeseen future costs. Capturing accurate data on the equipment, systems and fixtures that are working well and not working well, is important so that the design/construction managers know the most cost-effective path from a facilities management standpoint as they develop the next building or renovation.
It is also important to incorporate specifications, operating manuals, warranty information and other relevant equipment and system data into your maintenance management system. This becomes a starting point for performance analysis, including equipment evaluations and recommendations as you build the maintenance/performance/cost history.
The performance and cost history along with preventive maintenance procedures data will help employ knowledge management techniques and technologies to make optimal data-driven decisions and investments as well as help you decide when to repair, retrofit, or replace equipment.
Breaking down the barriers between planning and construction, maintenance and operations and incorporating TCO into the decision-making process for new buildings or retrofits should be the new organizational standard.
If you are interested in learning more or need assistance with your TCO journey, R Ledbetter & Associates can help - Let’s Start a Conversation.
Contact me at: Randy@rledbetter.com