Asset classes 101: An introduction
Asset managers play a crucial role in ensuring that assets are well-managed and deliver optimal performance. To effectively do so, relying on a classification system known as asset classes can be helpful.
Wait, do you already think your assets are divvied into classes? We suspected that this might be the case, so today we’re exploring how getting a little more granular can help you grab better data, make more informed decisions, and you know, the big one, save some money overall.
So, what exactly are asset classes?
In a simple distillation, asset classes are groups that can be further classified into types. Organising assets in this way lets you capture the level of detail required for specific assets that can then be filtered by specific characteristics.
Tree = group; its type = species (fir, oak, maple, etc.)
Bridge = group; its type = suspension, foot, cantilever, etc.
Categorising assets based on their maintenance, operations, or facilities management requirements helps asset managers to utilise data and insights to optimise their management practices.
Why organise assets this way?
Asset categorisation into classes can streamline management, resulting in focused strategies, more effective resource allocation, and proactive maintenance. It can help prioritise activities, enhance risk management, and maximise asset value, not to mention improve efficiency and optimise outcomes.
5 ways to use asset classes
Using asset classes can better inform decision-making, enables proactive maintenance strategies, and ultimately maximises the value and longevity of assets.
1. It starts with a plan (for a plan)
Whether it’s setting priorities, allocating resources effectively, or aligning maintenance activities with your organisation's goals, asset classes can do a lot to provide a strategic planning framework.
Say you have a bunch of assets at a school, ranging all the way from the lightbulbs, to the desks, to the boiler and HVAC, to the building or campus itself. Though seemingly all separate they are actually all connected and you can assign levels of importance — which ones are so mission-critical that if they were to break everything would stop until it’s repaired? Or, if one goes down, how does it impact the other assets around it, and what skills are needed to repair it?
By understanding the different categories of assets and their specific maintenance and operational needs, asset managers can develop comprehensive asset management strategies and understand how one asset can impact everything else around it.
2. Set yourself up to prioritise actions
Categorising assets into classes can help asset managers assess and manage risks associated with different types of assets.
For example, if a car drives off a road and crashes into a lampost, what’s the right order of operations to make repairs? You have a broken liampost, perhaps a blocked pavement, or even a part of your street that is now causing traffic to divert to another street. And, what’s going on with the electricity in the area? Was that lampost connected to other elements in the vicinity and are they affected? Evaluating your asset by classes enables you a bigger picture view to know what order to perform repairs.
When you prioritise assets based on their importance, maintenance requirements, and potential impact on adjacent assets, you can allocate resources or even implement preventive maintenance measures accordingly..
3. Trying to control costs? Try using asset classes
Using asset classes can be a game-changer when it comes to budgeting and cost control. By having a good grasp of the maintenance needs and expected costs for each asset class, you can make smarter decisions about where to allocate your funds — it's all about being well-informed.
Asset classes can also help you optimise your resource usage so you're scheduling maintenance in the most strategic way, leveraging your existing staff to work more efficiently, or following an order of operations that is the most effective for your organisation.
4. Data is in the details when tracking performance
Categorising assets into classes can give asset managers the data they need to track and evaluate asset performance over time. Asset managers can monitor these metrics and identify underperforming assets by setting specific performance indicators for each asset class, such as uptime, maintenance costs, or energy efficiency.
Analysing performance data also allows for data-driven decisions on maintenance, repair, or replacement, which helps optimise asset performance and, you guessed it, overall value.
5. An asset’s lifecycle can be long, if you plan well
Asset classes can help asset managers develop comprehensive lifecycle management plans. If you can use data to understand the expected lifespan, depreciation, and maintenance needs of assets within each class, then you can proactively plan for asset replacements or upgrades. (Helpful, when we talk about long-term budgeting, reducing unexpected costs, and realising optimal performance throughout an asset’s lifespan).
Our Brightly idea: Dive deeper to discover new-found efficiency
We get it, it sounds a little counterintuitive—who wants to spend more time logging details like asset classes? But hear us out. A little extra detail can go a long way to provide insight and agility when you need it most — and help make those more informed decisions.
Brightly with Confirm™ software provides a comprehensive understanding of asset conditions and planned works. When you capture any type of asset, your labour, materials, and equipment costs. You can know at a glance:
- What assets you have
- Where the assets are located
- What condition each asset is in
- The criticality of your assets
- How much your assets cost
- How much your assets are worth
See how Brightly + Confirm can help manage your assets, streamline information, and add value.