Asset life cycle management: towards improving physical asset performance in the process industry

Purpose – Asset management is often one of the last options to maximise cost savings in a competitive global economy due to its intrinsic complexity, especially in many developing countries. Asset management in the process industry must consider the commissioning, operational and end‐of‐life phases of physical assets when commencing a design and implementation project. However, current asset management models show inefficiencies in terms of addressing life cycle costs comprehensively, as well as other aspects of sustainable development. An asset life cycle management (ALCM) model is subsequently proposed for assets in the process industry, which integrates the concepts of generic project management frameworks and systems engineering with operational reliability in order to address these inefficiencies. Design/methodology/approach – Experiences within a large petrochemical company in South Africa are used as a case study to demonstrate and discuss the different components of the proposed ALCM model. Findings – Operational reliability and systems engineering are the means to achieve optimum value from physical assets over a facility's lifetime. Thereby, activities are identified that should be completed during each stage of the project life cycle. The application of performance measurements for the operation and support stages is proposed to influence decision making in the process industry. Originality/value – Specific issues pertaining to the ALCM model are highlighted to ensure optimal practicality and incorporation of the model with other management practices in the process industry.