THE DEFINITIVE GUIDE TO

Property Lifecycle Asset

Management Planning
Contents summary
Introduction 3

How this eBook will help you  4

Asset Management Planning Cycle 5

What is property lifecycle asset management? 6

Key steps for a firm foundation 7

Know what you have 7
Know what you need 7
Know what’s possible and do the right thing 7
Making it happen and feedback 8

Corporate and Commercial Asset Management  9

The principles  10
Demand vs Supply Model 10
Key points 11
Data to knowledge to actions 12
Making the framework work 13

Local Government Asset Management  15

Decision making framework – the works-programme  16

Key learnings 17

The property asset management plan 18

Key sections of a property AMP 18

Housing Asset Management  21

How the organisation supports property lifecycle asset management 22

Process22
People23
Technology23

Tertiary Education Asset Management  24

Do we have enough data? 25
How hard is it to resource the process? 25
Where do I start? 25

Conclusion 26

About SPM Assets 27

Introduction
SPM Assets specialises in asset management planning for property assets. We have been
making asset management work better for asset-intensive organisations since 2001,
establishing the best practices for assessing and maintaining assets and developing easy-to-
use asset management software. We aim to make asset managers’ jobs easier, with reliable,
scientific process for decision-making.

Steve Lyons, our CEO, authored the NAMS Property Manual, co-authored the IPWEA Practice
Note 3 for Building Condition and Performance Assessments and has contributed to the
International Infrastructure Management Manual (IIMM). This introductory guide to property
lifecycle asset management outlines key principles and considerations in the planning process
that are buried in the IPWEA guidelines – making it easier to make asset management work.

Why is this important? Organisations with extensive and complex asset portfolios need to
deliver more meaningful and sustainable outcomes to their communities, customers and other
stakeholders by delivering the right projects for the right reasons at the right time.

Property Lifecycle Asset Management Planning The Definitive Guide | Page 3 of 27

How this eBook will help you
We’ve written this eBook to help you to:
• see your property assets as a key factor in achieving your organisation’s strategic objectives

• recognise your property as a business enabler rather than a cost centre

• align your property strategy with your overall strategic objectives for better long-term
decisions

• understand how to find answers to stakeholder needs that are cost effective and meet
your organisation’s objectives

• manage property proactively and avoid unplanned or reactive works that can put your
organisation and people at risk

• identify and manage risk, including predicting the timing and extent of ‘whole of life’ costs

• prioritise work and purchases so you have sufficient funds when required well into the
future

• use practical tools to keep track of your property condition, performance and projects

• agree levels of service, including assessing whether a property meets a defined quality

• standard, is compliant with legislation, is accessible, is being well utilised, and is functional

• make a recognised and valuable contribution to the success of your organisation

Property Lifecycle Asset Management Planning The Definitive Guide | Page 4 of 27

Asset Management Planning Cycle

Audits,
Assessments
Inspections
Inspect

Grounds Mechanics

$...m
Assets Lifts $GRC Fire
Asset Register
Know
(Component Value)
Fabric Electronics your
Assess Predictive assets
risk models

$...m
$

$...m
Lifecycle Analysis Lifecycle
(2021 to 2036)
Know
2021 2036
what
Analyse Policies/‘Service
Asset Level Analysis you need
Standards’

$
$...m
Value of Programs
Planned Projects 21 022 023 024 025 026 027 028 029 030 031 032 033 034 035 036
Know
what you
20

(Optimised 2021 to 2036)

2 2 2 2 2 2 2 2 2 2 2 2 2 2 2

Plan Project Level Decisions

will do

Implement /
Project manage
the projects
Then
do the
work

Property Lifecycle Asset Management Planning The Definitive Guide | Page 5 of 27

What is property lifecycle
asset management?
The ISO 55000 standard on asset management is the internationally accepted standard on
what to do to when managing physical assets – whether property, infrastructure or plant
and machinery. Where ISO 55000 outlines what you need to do, the IPWEA manual provides
guidance on how to do it across all asset types, and this eBook provides more specific
guidance on property assets.

As such, good property asset management can involve all or some of these common business
processes:

• risk management

• information management

• financial planning

• customer consultation

• maintenance management

• project planning

• facility management

• lease or occupancy management

Property Lifecycle Asset Management Planning The Definitive Guide | Page 6 of 27

Key steps for a firm foundation
Regardless of how mature your asset management processes are, there are some
fundamental concepts you need to consider. Getting these concepts right, will make the overall
process of asset management more valuable to you and your organisation - and ensure a firm
foundation for decision making.

Know what you have

The overall process begins by establishing an Information Management Strategy
(IMS). The IMS describes ways to obtain the appropriate level of data suitable to the
needs of the organisation, ensuring this information is appropriately maintained as
an ongoing business process that is well resourced.

Know what you need

Start with defining your level of service, policies and standards. Understand the risks
each property is exposed to – know the functional and compliance requirements and
understand utilisation as demand varies over time. You should undertake a lifecycle
analysis of at least 10 years and ideally over 20 years.

Know what’s possible and do the right thing

Armed with the information from the above steps, develop a list of possible solutions
to address current and future shortfalls – both evidence-based from the bottom-up
and judgement from the top-down. These projects then feed into a decision-making
framework to move from a reactive to a planned approach to asset management –
doing the right projects at the right time for the right reasons.

It’s important to link asset planning to organisational strategy – doing what’s

important now (prioritisation) manages risks and provides opportunity, while thinking
and planning long- term to ensure sustainability.

Property Lifecycle Asset Management Planning The Definitive Guide | Page 7 of 27

 Making it happen and feedback
Your list of prioritised projects is considered within budgets and, where needed, the
governing body decides on what’s more important considering wider strategies. The
approved projects are passed to project managers for implementation – this is where
the value of the asset management process is recognised. You will be delivering real
projects that make a difference – therefore, once the project is completed you can
report on the outcomes achieved.

Feedback the resulting asset data to the asset management system – which then
resets the lifecycle modelling and addresses the risks and backlog. This is also the
point at which you understand the true implications of agreed levels of service,
policies, and standards. It may be necessary to amend these to reflect available
sources of long-term operating and capital funding.

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Corporate and Commercial
Asset Management
 The principles
Property asset management planning is based on the following principles:

Demand vs Supply Model

Properties need to be aligned with the people that use them. We need to consider both the
current and future requirements of these people and establish a way in which the property will
continue being useful well into the future.

Requirements of
Property Users
As defined by
Business planning strategy

Current
Future Possible future
User  property user
property user
Demand
Needs requirements are Demand requirements known
delivered?

Current Future

Gap Gap

Asset Current asset Assets Demands on the

Response base Gap future asset base Supply

Asset management
strategies to close
the Gaps

Property Lifecycle Asset Management Planning The Definitive Guide | Page 10 of 27

Key points

• The planning process is driven by the needs of the people using the property – sometimes
referred to as ‘service-led asset management’ – matching the needs with the property
both now and into the future – whilst aligning these needs with the organisation’s strategic
objectives.

• Establish measurable levels of service statements that drive the resulting works
programmes, operating regimes, and maintenance regimes.

• Changing expectations – This goes well beyond property condition. Changes in

demographics, technology, statutory regulation, tenants’ needs, local or international
trends and organisational policy all need to be considered.

• Asset behaviour – predicting how assets deteriorate over time is an evolving and complex
science. Strategies are needed to ensure that assets are renewed or replaced in a way
that controls the effects of their failure. Where some non-critical assets can fail with little
consequence, other assets cannot be allowed to fail, such as ventilation of a room housing
computer servers. Asset failure needs to be predicted and managed efficiently.

• Once the gaps or shortfalls are identified and quantified, they can be managed through
asset management strategies – most likely resulting in a list of planned-projects.

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Data to knowledge to actions

There are important linkages between the organisation structure, data, decision making, and
action. Asset management usually is undertaken at the tactical level of an organisation and
provides the important link between strategy and delivery or operations. The diagram below
shows this - the transformation of data to knowledge (left-hand side) and the decision process
(right-hand side) with the organisational structure described as strategy, tactics and operations.

Information and Decision Concepts

Knowledge Strategy Decisions

Information Tactics

Data Operations Actions

Traditional ‘bottom-up’ asset planning begins with the collection and analysis of data to provide
information to decision makers. The ‘top-down’ approach often starts with knowledge of key
people to decide on the right projects. The reality is that a ‘mixed-approach’ is used – using
evidence where possible, mixed with the judgement, and with ongoing data improvement
activities, the mix could move from 20% evidence to 80% evidence over 3 to 5 years.

This journey shifts us from the operational realm of data collection through tactical planning,
enabling decisions to be made based on knowledge at the strategic level and back down to
implementation at the operational level.

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Making the framework work

Property asset planning follows a logical path that’s simple to understand by all levels of the
organisation. It needs to be simple so that potential new processes, systems and roles can be
introduced with little disruption to the organisation’s daily business activities.

• Asset data at an appropriate level of detail is collected and maintained

• This data is analysed to produce information

• The resulting information is used to develop tactical options including both asset (planned
projects), non-asset (changing policies or level of service standards) and non-owned asset
(leasing rather than owning) solutions

• These options are evaluated against risks and benefits

• Decisions are made, based on the funding available, strategic direction of the organisation,
and recognises the governing body’s right to make changes

• Physical works projects are completed and resulting project information is transformed into
asset data

Asset Planning Framework

Deliver
outcomes

Data

Se
pp
en
Kn
ow c
wh t
ha
it a
iot you h

Operatio
e

n 3 ave
n6
ak
dm
an
Sectio

ns
Do the right thing

Strategy

s
T a c tic
4
ed
on
ne

Make ec i
ct a
ou
SK

no
tio S enow wh
ty

w
wh
n5
decisions a t’
sp
os
si b le
K

Information
Develop
solutions

The cornerstone of the asset planning framework and underpins all asset planning processes.

Property Lifecycle Asset Management Planning The Definitive Guide | Page 13 of 27

The four sections of the framework can be described as:

1. Data analysis
Knowing what is needed by analysing the base data, considering the user’s requirements, levels
of service, and knowing the effect of possible future events. The analysis process identifies the
current and future gaps and feeds improved information to the tactical planning process.

2. Tactical planning
Knowing what is possible by using the information from the data analysis process. It is often
driven by the risks associated with aging and deteriorating assets where predictive lifecycle
models are used to determine plans for 10 to 30 years plus – looking after the existing facilities
to make them last longer in a more cost-effective way. However, tactical options also consider
other factors that often drive higher investment, i.e. political change, expectations of users,
compliance with standards, and change of use. Well-scoped, planned projects are the output
of the tactical planning process.

3. Strategic to tactical implementation

Having a selection of planned projects to choose from, the decision makers must decide which
projects will be implemented considering the risks being controlled, competing priorities, and
available funding. Asset Managers need to inform the governing body of the consequences of
delaying or cancelling projects and provide the information to explore risk and funding trade-
offs. The governing body is held accountable for any adverse event that may occur but at the
same time, the governing body relies on the information and recommendations made by the
Asset Managers.

4. Operational implementation
Once decisions are made, the organisation needs to implement the projects (make it happen).
For a typical construction project, this process includes the detailed design, tendering,
construction, handover to the operator and the ongoing lifecycle maintenance. It is important
to note that regardless of whether the project is a major construction project or simply
renewing carpet, translating project information to asset data is critical to complete the asset
planning cycle for the following reasons:

• keeps the asset register well maintained so that lifecycle analysis results can be relied on

• best time to capture asset data at the lowest cost, e.g. contractors can provide the data
rather than surveyors provided the requirement is clearly defined and specified

• collecting data early can help optimise design and decision making

• building up the property’s service history helps to create knowledge and understand asset
lifecycle deterioration and performance characteristics

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Local Government
Asset Management
Decision making framework –
the works-programme
Following the above principles, we will be able to identify the current and future requirements
of the organisation, know how these are being addressed now, know ways to address any
shortfalls and provide recommended tactics and planned projects for implementation.

The end result of a good asset management plan is a reliable list of projects with a number
of budgeted works-programmes that are driven by levels of service statements (policies and
standards), manage risk and are supported by asset level evidence wherever possible.

It is important that appropriately planned projects inform the financial forecasts from years 1
to 5, and asset level lifecycle predictions are used from years 6 to 20 plus. The decision-making
process relies on risk and priorities at the asset and project levels to determine which works-
programmes and projects must be done now and which can be deferred. Where we would like
to implement all projects, we can only do what’s affordable and achievable.

Deferring projects increases risk – the governing body will need to consider the consequence
of these delays and make decisions on which projects to implement and which to delay while
still controlling risk.

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Key learnings

• Asset planning is an iterative process – first identify what’s needed, then identify whether
it’s affordable, then adjust by changing the levels of service standards, while recognising
the resulting risks.

• Understand the value assets provide in terms of achieving organisational objectives and
supporting organisational strategies and plans.

• Align asset planning with your organisation’s strategic objectives – using strategic objectives
to determine asset and funding requirements.

The success of property asset planning is directly related to the commitment that
the senior management of the organisation have to the process. If a directive is
to simply write an AMP, then that is all that will be produced. An AMP document
by itself only provides limited value at a particular point in time.

• Knowing what you have is very important and should come before defining your levels of
service.

• Information management ties all asset planning processes together – if we can’t measure,
we can’t manage.

• Consider the full lifecycle planning process - asset creation, renewal, maintenance,
modernisation, reconfiguration and eventual disposal.

• Knowing the financial implications of owning and managing property assets is the end
result of the planning process.

• Projects will be implemented depending on whether the plan is achievable.

• If the plan is not achievable, the organisation may need to reconsider its strategic
objectives or levels of service statements and targets.

• The process is cyclic and should be regularly reviewed and audited.

• Ensuring improvement tasks (data, systems, process and people) are undertaken within
agreed timeframes will ensure the plans are accurate, complete and reliable.

An organisation that has aligned their data, processes, systems and people to
deliver effective and efficient asset management will better manage their risks,
funding, people and be more likely to achieve their strategic objectives.

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The property asset management plan
Apart from being required by ISO 55000, the AMP provides the opportunity
to tell your story in a compelling way. The story is read by a range of
stakeholders and is your opportunity to inform them on the extent and
condition of your asset portfolio, what’s important to the organisation and
its customers from an asset perspective, and how much it could cost to
manage risk, making them last longer in a more cost effective way, and what
to expect from a growth and improvement perspective.

Writing an AMP helps with thinking through the logic flow of the overall process. Hence, the
AMP can be used as a guide to direct activities and tasks in a planned and auditable way.
Although it may take a period of 1 to 3 years to get to this stage, the AMP will articulate these
processes and the decisions that have already been made rather than creating them just for
the sake of populating an AMP.

Key sections of a property AMP

Strategic planning
Knowing the organisation’s strategic direction, and its objectives and policies is at the start of
the asset planning process. This sets the scene and provides the understanding of where the
organisation is going. It will identify what’s important to the organisation, its asset management
policies and objectives, and demonstrate the governing body’s commitment to the process and
outcomes.

Asset information
Gaining appropriate information is the next stage of the process. This only happens once you
have buy-in from senior management on the process and asset management objectives have
been set. Managing asset information over time needs to be an enduring business process – it
simply needs to be a line item in your operational budgets each year.

The AMP reports the current value, condition, and performance of the asset portfolio.

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 Future demand
Once you know what assets you have, you then need to know what assets you may need in
the future. And this is determined through a range of demand scenarios, where a demand
statement is made. Strategies are then aligned with the demand statement. Often undertaken
elsewhere in the organisation – where future needs are being planned by other service
departments, it’s the Asset Manager’s role to know about these and ensure that the property
assets are on the strategic agenda.

Establish levels of service

This is where the tactical planning process links the operational activities to the strategic
objectives through levels of service statements, measures and targets. Implementation of
programmes, projects and non-asset strategies address these gaps. Policies and standards
drive the planned works programme hence, getting these statements right can be a challenge
especially when the policy is to replace or renew before failure.

Analysis of tactical options

This section of the AMP is where the Asset Manager can make a real difference to the way
the organisation thinks about what needs to be done to achieve the organisation’s strategic
objectives. At this stage the AMP identifies the gaps between the user requirements and the
outcomes provided by use of the asset base. The Asset Manager therefore presents a range of
tactical options in the form of asset, non-asset and non-owned asset responses. Aggregating
the options will likely be unachievable but this shows you have thought through the options
and are reporting them in the AMP. This is your list of potential projects for consideration
including your lifecycle forecasts.

Financial information
Decisions are documented in the AMP as budgeted programmes and associated projects. This
section should summarise the projected expenditure in categories such as capital, maintenance
and operational expenditure at the highest level. The financial forecasts are compared to funding
sources and any financial shortfalls are identified. The resulting works-programmes are made up
from planned-projects and match annual budgets through risk and prioritisation.

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 Asset management practices
This section describes the current and future practices and software that the organisation is
using and is likely to introduce, respectively. The Information Management Strategy (IMS), Risk
Management Strategy, Maintenance Policies and Capitalisation Policy could be summarised
here. It may also include an overview of how current software links with each other – including
enterprise systems, data collection systems, and planning systems.

Improvement plan
It is advisable to create an Assumptions or Improvement Register as the AMP is being
developed. This then drives the continuation of the asset management process in an enduring
way. The Improvement Plan itself is a key tool in the ongoing monitoring of progress – it is a
series of projects or tasks that need to be managed.

Reporting outcomes
The AMP needs to report the performance of the financial and non-financial outcomes that are
being realised through the asset management strategies which the organisation as a whole is
implementing.

Good asset management stresses the need to make property decisions at the
strategic level. These decisions are reflected in the AMP at the tactical
level. The day-to-day operations are then carried out
in a way that supports both.

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Housing Asset
Management
How the organisation supports
property lifecycle asset management
However big or small your organisation is, the following ideas will help you
strengthen your planning process.

Process
• Property should be on your strategic agenda and be regularly reviewed. Ensuring your
asset management policies, objectives and tactics fit your organisation’s strategic plan.

• You need to describe and measure your current and desired levels of service (standards
and policies) so that your objectives are achieved, and property is performing as you
intend.

• An Asset Management Steering Group needs to meet regularly to make sure you’re going
in the right direction and things are getting done.

• When data is captured it needs to be relevant and at the appropriate level of detail, as set
out in your Information Management Strategy.

• Information should be reported and communicated in such a way that it cannot be

ignored. This allows your organisation to use it to make decisions and add real value.

• You need to plan for the extra costs of introducing new business processes.

• Decisions are made at project level – move from asset level analysis to project level
decision making.

• The approach is iterative. It is expected that the first iteration will not be achievable.
However, the first iteration identifies the true cost of achieving your strategic objectives
and the ideal ‘levels of service’. The second and third iteration will align more achievable
strategies and levels of service while informing the governing body of the implications of
non or partial implementation.

• Know your current asset base and look after it before building new – can your organisation
afford to do both well?

• It’s a risk-based approach - know the risk associated with having asset or service gaps.
Investigate the possible events that could take place, know what would be the consequence
of these events happening and know the likelihood of these events taking place.

• Implement improvement activities using project management disciplines, i.e. assigning

responsibilities, budgets and timeframes. Report the progress made towards implementing
the improvement programmes in the annual strategic documents.

Property Lifecycle Asset Management Planning The Definitive Guide | Page 22 of 27

 People
• Senior management and the board need to ‘buy in’ to the property strategy and asset
planning process – aligning with ISO 55000 can drive this. There needs to be a commitment
to move from a reactive to a planned approach to asset management.

• There needs to be a commitment from senior management to use the resulting property
asset information for planning and to revise objectives and strategies where necessary.
Structured analysis of data provides reliable, accurate and complete information that will
lead to better performance over time.

• Successful planning needs a dedicated Asset Manager or coordinator. The organisational

structure needs to consider how the asset management processes, data and systems
will be implemented. People should be appointed to positions that deliver the desired
outcomes.

• Get involved with industry groups to share knowledge and information including
benchmarking.

Technology
• You will need asset management software to store, analyse and report the information
used to make decisions.

Property Lifecycle Asset Management Planning The Definitive Guide | Page 23 of 27

Tertiary Education
Asset Management
 Do we have enough data?
It is important to have a well-thought-out information management strategy. However, don’t
delay introducing an asset planning process just because you haven’t got enough data. You
can make assumptions and state the related data confidence. You can then improve your
targeted data over time.

How hard is it to resource the process?

You need both internal and external budgets to be sure you have enough resources.
Depending on the organisation’s level of commitment, it may be best for you to use internal
resources at the beginning. However, external specialists can provide immediate benefits, so
you should consider using them if you can.

Where do I start
Start with forming an Asset Management Steering Group and pull together a Project Team.
The team will need a good plan with measurable improvements identified. Undertake a gap
analysis at the start and end of the project. Assign actions and responsibilities to make it all
happen.

Buy a copy of the IPWEA guidance material that’s right for you and study ISO 55000 – find
a good coach or mentor – it may first seem like a major undertaking but with the right
advice and support, you may be surprised how quickly it can come together.

Property Lifecycle Asset Management Planning The Definitive Guide | Page 25 of 27

Conclusion
In summary, we’ve given you an overview of asset management planning – we’ve outlined
some key starting steps, the asset planning framework, the property asset management plan,
organisational support, time and resources needed and where to start. This should give you a
good foundation to understand and begin your Property Lifecycle Asset Management journey
with confidence.

SPM Assets is offering you a series of tools and templates which will help you achieve the key
steps outlined in this eBook.

Property Lifecycle Asset Management Planning The Definitive Guide | Page 26 of 27

About SPM Assets
SPM Assets specialises in strategic asset management. We provide asset management
services and easy-to-use asset management cloud software to help organisations with
property portfolios build a better understanding of their physical assets and enable them
to plan their projects and forecast more effectively, whilst achieving better outcomes for
their communities. We have been making asset management better for asset intensive
organisations since 2001, holding information on over $150 billion of property assets, and
continually innovating systems to provide our customers reliable, evidence based data for
decision making.

Our main office is located in Auckland, New Zealand, and we have offices in Sydney,
Australia and New York City, USA.

Please contact us to find out more about how we can simplify your
asset management planning process and make it work better for you.

Smarter property lifecycle

asset management

Visit us at www.spmassets.com

© 2021 SPM Assets Ltd. All rights reserved.