ABSTRACT
In most corporate organizations today, tangible assets in real estate, manufacturing, transportation fleets, physical infrastructures, and information technology dominate the balance sheet. They are frequently one of the two largest overhead costs (after personnel and benefits). In fact, according to the ARC Advisory Group:
2.1 Introduction .................................................................................................... 11 2.2 Total Life-Cycle Asset Management .............................................................. 15
2.2.1 Asset Strategy ..................................................................................... 15 2.2.2 Plan ..................................................................................................... 16 2.2.3 Evaluate and Design ........................................................................... 16 2.2.4 Create and Procure ............................................................................. 17 2.2.5 Operate................................................................................................ 17 2.2.6 Maintain .............................................................................................. 17 2.2.7 Modify ................................................................................................ 18 2.2.8 Dispose ............................................................................................... 18 2.2.9 Financial Management ....................................................................... 18 2.2.10 Technology .......................................................................................... 18
One of the first challenges for organizations in determining the impact of assets to the bottom line is to attempt to identify and categorize what really constitutes an asset. For the purposes of this book, we describe assets in a physical sense rather than from a financial portfolio perspective and, as shown in Figure 2.1, classify them into groupings such as real estate and facilities, plant and production, mobile assets, infrastructure, and information technology.
