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Optimising investments and maintaining services
Asset management is a series of systematic and coordinated management practices that help optimise performance while minimising costs and risk of asset failure.
Asset management leads to more realistic budgeting and planning and enables considerable cost savings over the medium and long term. By enabling replacements to be planned for and financed properly, it helps to ensure services are maintained permanently.
Adopting an asset management approach involves:
- maintaining an up-to-date register of all assets in an area;
- defining the service levels to be provided;
- understanding how assets fail (e.g. a slow deterioration or sudden failure); and
- understanding of the life-cycle costs of the assets.
With this knowledge, it's possible to make a projection of when and how to replace certain assets, and at what cost. Asset management draws on monitoring and costing information and should be considered together with these activities.
Tools & guidance
Most tools and approaches to asset management have been developed for large-scale utilities and need to be adapted to rural and resource poor contexts. IRC has been involved in efforts to develop appropriate integrated asset management and costing tools in Bolivia, Kenya and Ghana as well as documenting an example of successful rural asset management in South Africa. These tools and cases can provide insights and methods which can be adapted to other country contexts.
The work in Bolivia resulted in tool that provides a cost overview for capital investment, O&M and eventual replacement and it supports the user to identify investment needs and possible funding gaps.