Asset Management and Life Cycle Flashcards

Which metric best indicates whether an organization's asset management program is effectively balancing planned versus unplanned maintenance?

Answer: Planned maintenance percentage (PMP)

Planned maintenance percentage measures the ratio of planned work hours to total maintenance hours, with world-class targets typically above 85%.

What is 'functional location' as used in computerized maintenance management systems (CMMS)?

Answer: A hierarchical position in the plant structure where an asset is installed

A functional location defines where an asset sits within the plant hierarchy (e.g., Plant > Unit > System > Equipment), enabling location-based reporting independent of the asset itself.

Which ISO standard provides the primary framework for physical asset management systems?

Answer: ISO 55000

ISO 55000 (and its companion standards ISO 55001 and 55002) defines the requirements and guidance for establishing an asset management system.

What is the purpose of an asset criticality ranking in a maintenance program?

Answer: To prioritize maintenance resources toward assets with the greatest impact on safety, production, and cost

Asset criticality ranking scores each asset based on failure consequences so that maintenance strategies, resources, and spare parts can be allocated proportionally.

In the context of asset life cycle, what does 'recommissioning' typically involve?

Answer: Restoring a dormant or mothballed asset to operational service

Recommissioning returns a previously idled asset to service, requiring inspection, testing, and verification that it meets current safety and performance standards.

Which financial approach allocates a portion of an asset's cost as an expense over its useful life to reflect consumption of value?

Answer: Depreciation

Depreciation systematically allocates the cost of a tangible asset over its useful life, reflecting the decline in economic value as the asset is consumed.