striven to better his production of tools, then of machines—in short, of assets. But up to the Industrial Revolution, and, to some extent, even in our modern times, assets that were to be operated have been regarded as ends within themselves, thus neglecting the optimization of value whose realization they would permit. Reflections of life cycles have not been useful up to now, because the notion had not been proven to embody a true necessity. Historically, designers have been allowed to create in total freedom from external constraints, since what was expected from them was to design a tool responding to a precise need, and whose function was immediate.
Until the introduction of CAPEX/OPEX trade-offs (which establish a relation between procurement investments and maintenance costs in the production phase), costs had been somewhat absent from this historical scheme. Since the task that had been set consisted solely of responding to a functional imperative, it seemed unnecessary to take into account risks of degradation and aging of the assets and machines. Thus, I’ve been invited a countless number of times to take part in broadly chance-based projections of operational and maintenance costs, sometimes as early on as in the context of a call for tender where all too often the practice, even today, is to appear as the concurrent able to display the smallest “ignorance coefficient” in regard to the operational costs of the life cycle. We can take pride in having participated, throughout the last three decades, in the implementation of a culture which takes operational reliability and life cycle costing much more seriously; however, this culture has yet to impose itself as a true industrial standard.
To this day, one can deplore a lack of anticipation regarding the life cycles of different assets. Even in the case of organizations that have begun to open up to an Asset Management line of thought, the profile of professionals sought after for this type of mission is radically distinct from that expected for other missions. This can induce a lack of coordination, and therefore of alignment, in corporate perspectives. Once more, we can observe that organizational segmentation is harmful to the optimal efficiency of decisions tied to the assets. The reality is therefore that of a complex mix of needs: that of the implementation of a more “long-term focused” vision, of a transformation of traditional leadership, and of a more holistic management for the different segments of the assets’ life cycles.
Let us stop to consider the role attributed to design offices in the organizational chart organigram: these offices are responsible for the assets’ conception, design, and specification. Thus, they are exclusively made up of engineers, trained and habilitated to consider the asset in terms of its sizing and functionality, but not specifically in terms of its life cycle.
By no means do we intend to minimize the usefulness of the engineers’ work, which is more often than not very well executed and remains entirely necessary; our intention is rather to bring forth a redefinition of the value that this engineering work generates. It is obvious that engineers produce a certain value, were it only of a commercial nature. But in order for us to be able to talk about “value” in the sense of “value extraction,” inherent to the best practices of Asset Management, the designer-engineers themselves should be taught and trained on the fundamental concepts of Asset Management; once more, the absence of a proper coordination of the different segments that make up the traditional organization is an obstacle to the optimal realization of value from the assets.
This “coordination” that we’ve brought up allows for an optimization of the alignment between corporate objectives (expressed by the organization’s decision makers) and the work of the engineers. It is a crucial factor in the creation of a high-value asset, and one whose importance can be observed from the very first moments of the preoperational phase. In order to achieve an optimal creation of value, the action of the engineers must be similarly aligned to that of other branches of the organizational chart. Indeed, in the notion of Line of Sight, introduced in the referential document BSI PAS 55, it is stated that it is crucial to take into account the expectations and interests of stakeholders and to ensure that these are aligned with operational actions from the earliest stages of the preoperational phase as they are the more intricately tied with the assets’ proper financial and physical health. They are, in the end, the most prevalent factor in the achievement of the required performance.
1.3 Decision-Making in the Preoperational Phase: Atony Comes at a Cost
In the overwhelming majority of organizations, we can observe that a vast number of industrial projects are bought or designed on behalf of preexisting rationales and by the means of a reproduction of anterior projects. Industrial decision makers often try to justify these practices through commercial agreements (a typical example would be that of turnkey projects) or through political and economic reasons. Organizations benefit from this approach on the short term, by making economies of scale and by radically reducing the temporal and budgetary resources mobilized for conception. However, this “recooked” approach to the design phase is in stark opposition to the inherent principles of Asset Management and to every notion brought forth by studies on life cycle costing.
Let us consider, in order to exemplify this line of thought, the case of industries that rely heavily on continuous processing (such as metallurgy, chemicals, etc.) or on massive amounts of fixed capitals (such as automobile manufacturing or large-scale infrastructures, e.g., water processing). In four out of five of these cases, the mechanical installations (for example, a line of laminators) are purchased “key in hand.” It would be disproportionate to expect from organizations that they reinvent their entire field of activities for every new project that they implement. However, the present rationale, which takes its roots on the one side in the faith placed in a certain economic illusion on the part of the decision makers and, on the other, in an analysis betrayed by a profound misunderstanding of the machines’ life cycles, is strongly problematic. This is because those who abide it remain, despite their best intentions, unaware of the changes that occur every day in the spheres of economics, finance, and technology, as well as of the needs and interests of stakeholders.
To indefinitely reconduct such projects is a symptom of a refusal to recognize that the world is in permanent mutation and that it is both responsible and proactive to try and adapt to its evolution. On the contrary, acting as though “one could bathe twice in the same river” appears as a posture of pure negligence.
The teams of engineers that operate in the design offices of these heavy industries are well aware of the necessity of associating metrics of performance to every project being developed. But those very metrics have been designed in a frame that is constrained to the task of conception, or the “project” phase. Thus, the measurement units that are used to qualify projects are unfit to assess their performance in their mature lives, and are therefore inefficient or imprecise at best.
1.4 An Opportunity for Improvement in Asset Design
Asset Management strongly supports the creative freedom of designers and conception agents since it is an undeniable vector of the rise of a new holistic perspective, which takes into account the assets’ complete life cycles. It is therefore essential to encourage the innovative work of engineers. In order to do so, a number of techniques have been developed thanks to the input of life cycle costing and trade-offs studies. Not only are these techniques now broadly available, but their efficiency has been demonstrated empirically.
Why, then, do managers not strive to more efficiently align objectives as early as the preoperational phase? Why do they not attempt to master practices such as risk monetization? Indisputably, a number of them have already begun to do so. However, they only make up a marginal portion of industries so far and, in most of these cases, the methods employed remain rudimentary. Yet the shortfalls which derive from this posture are nothing short of phenomenal. The growing democratization of the availability of applications and software relying on very powerful algorithms should contribute to the evolution of these “modes
