Asset Management Companies

Asset management is a systematic approach to the governance and realization of value from the things that a group or entity is responsible for, over their whole life cycles. It may apply both to tangible assets (physical objects such as buildings or equipment) and to intangible assets (such as human capital, intellectual property, goodwill or financial assets). Asset management is a systematic process of developing, operating, maintaining, upgrading, and disposing of assets in the most cost-effective manner (including all costs, risks, and performance attributes).

The term is commonly used in the financial sector to describe people and companies who manage investments on behalf of others. Those include, for example, investment managers that manage the assets of a pension fund.

It is also increasingly used in both the business world and public infrastructure sectors to ensure a coordinated approach to the optimization of costs, risks, service/performance, and sustainability.

ISO 55000, being developed by ISO TC 251, provides an introduction and requirements specification for a management system for asset management.

By industry

Financial asset management

The most common usage of the term portfolio manager (asset manager) refers to investment management, the sector of the financial services industry that manages investment funds and segregated client accounts. Asset management is part of a financial company that employs experts who manage money and handle the investments of clients. This is done either actively or passively.

* Active asset management: this involves active tasks such as studying the client's assets to planning and looking after the investments, all things are looked after by the asset managers, and recommendations are provided based on the financial health of each client. Active asset management comes at a higher price to investors because more work is involved.

* Passive asset management: assets are allocated to mirror a market or a sector index. Unlike active asset management, passive asset management is a lot less laborious. It is also less tailored, requires less looking after, and consequently is cheaper for investors.

Physical and Infrastructure asset management

Infrastructure asset management is the combination of management, financial, economic, engineering, and other practices applied to physical assets to provide the best value level of service for the costs involved. It includes the management of the entire life cycle—including design, construction, commissioning, operating, maintaining, repairing, modifying, replacing, and decommissioning/disposal—of physical and infrastructure assets. Operation and maintenance of assets in a constrained budget environment require a prioritization scheme. As a way of illustration, the recent development of renewable energy has seen the rise of effective asset managers involved in the management of solar systems (solar parks, rooftops, and windmills). These teams often collaborate with financial asset managers in order to offer turnkey solutions to investors. Infrastructure asset management became very important in most of the developed countries in the 21st century, since their infrastructure network was almost completed in the 20th century and they have to manage to operate and maintain them cost-effectively.
Software asset management is one kind of infrastructure asset management.

The International Organization for Standardization published its management system standard for asset management in 2014. The ISO 55000 series provides terminology, requirements, and guidance for implementing, maintaining and improving an effective asset management system. The key to forming a structure of this sort is directly connected to local governance.

* Physical asset management: the practice of managing the entire life cycle (design, construction, commissioning, operating, maintaining, repairing, modifying, replacing, and decommissioning/disposal) of physical and infrastructure assets such as structures, production, and service plant, power, water, and waste treatment facilities, distribution networks, transport systems, buildings, and other physical assets. The increasing availability of data from asset systems is allowing the principles of Total Cost of Ownership to be applied to facility management of an individual system, a building, or across a campus. Physical asset management is related to asset health management.
*Infrastructure asset management expands on this theme in relation primarily to the public sector, utilities, property, and transport systems. Additionally, Asset Management can refer to shaping the future interfaces between the human, built, and natural environments through collaborative and evidence-based decision processes
*Fixed assets management: an accounting process that seeks to track fixed assets for financial accounting
*IT asset management: the set of business practices that join financial, contractual, and inventory functions to support life cycle management and strategic decision making for the IT environment.
* Digital asset management: a form of electronic media content management that includes digital assets

Enterprise asset management

Enterprise asset management (EAM) systems are asset ''information'' systems that support the management of an organization's assets. An EAM includes an asset registry (inventory of assets and their attributes) combined with a computerized maintenance management system (CMMS) and other modules (such as inventory or materials management). Assets that are geographically distributed, interconnected or networked, are often also represented through the use of geographic information systems (GIS).

GIS-centric asset registry standardizes data and improves interoperability, providing users the capability to reuse, coordinate, and share information efficiently and effectively. A GIS platform combined with information of both the "hard" and "soft" assets helps to remove the traditional silos of departmental functions. While the hard assets are the typical physical assets or infrastructure assets, the soft assets might include permits, licenses, brands, patents, right-of-ways, and other entitlements or valued items.

The EAM system is only one of the 'enables' of good asset management. Asset managers need to make informed decisions to fulfill their organizational goals, this requires good asset information but also leadership, clarity of strategic priorities, competencies, inter-departmental collaboration and communications, workforce, and supply chain engagement, risk and change management systems, performance monitoring, and continual improvement.

Public asset management

Public 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. An example in which public asset management is used is land-use development and planning.

Intellectual and non-physical asset management

Increasingly both consumers and organizations use assets, e.g. software, music, books, etc. where the user's rights are constrained by a license agreement. An asset management system would identify the constraints upon such licenses, e.g. a period. If, for example, one licenses software, often the license is for a given period. Adobe and Microsoft both offer time-based software licenses. In both the corporate and consumer worlds, there is a distinction between software ownership and the updating of software. One may own a version of the software, but not newer versions of the software. Cellular phones are often not updated by vendors, in an attempt to force a purchase of newer hardware. Large companies such as Oracle, that license software to clients distinguish between the right to use and the right to receive maintenance/support.

See also

* Asset management firm
* IT asset management
* List of asset management firms
* P2P asset management
* Robo-advisor
* Software asset management
* ISO 55000

References

Further reading

* Baird, G. "Defining Public Asset Management for Municipal Water Utilities". ''Journal American Water Works Association'' May 2011, 103:5:30, www.awwa.org

External links

ISO/TC 251 - ISO Asset Management Information



IAM page for an introduction to Asset Management

Stages in IT Asset Lifecycle Management

{{Authority control

Management accounting
Valuation (finance)