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Asset types may differ across industry sectors and across public and private sector organizations, but there are significant common challenges. While the asset types may differ, most organizations struggle to know their assets’ conditions and states of repair. With COVID-19 adding a sense of urgency and more complexity to the equation, taking steps to maximize asset lifecycles and performance levels might allow for future-proofing amid the uncertainty.
PRIVATE SECTOR CHALLENGED BY AGING ASSETS
Some industrial organizations have shown it’s possible to implement change quickly, as production lines around the world reconfigured to make essential parts for ventilators, personal protective equipment or sanitizer products.
However, large-scale retooling of manufacturing facilities in the short-term represents a challenge for most, made worse by the fragility of the global supply chain. Many organizations will find they can only continue generating profit if they reevaluate how they manage their aging assets.
Private sector organizations need to address the legacy of under-investment in assets, the lack of optimization in the capital planning process, and the challenge of repurposing aging assets that are no longer fit-for-purpose.
PUBLIC SECTOR FACES GROWING INVESTMENT GAP AND AFFORDABILITY CONCERNS
Latent challenges facing public sector organizations who own and operate aging infrastructure are becoming ever-more exposed in the light of the global pandemic. As well as the aging asset concerns that they share with the private sector, public bodies have been working against a backdrop of changing demographics, consumption patterns and climate conditions. This will result is shortage of capital and operational budgets, which will only contribute to a vicious cycle of asset deterioration.
The strain will only increase, as many infrastructure and water assets are performing beyond the limitations of their original design and major resource constraints lie ahead. U.S. water and wastewater infrastructure is deteriorating faster than utilities can rehabilitate or replace it. The estimated average age of U.S. water pipes is 45 years, and North America saw a 27% increase in water main breaks between 2012 and 2018. In addition, the investment gap for infrastructure solutions is still growing.
Consequently, there needs to be a focus on how to optimize assets while reducing cost and minimizing risk.
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COVID-19
The coronavirus pandemic is causing widespread global disruption and will have various implications for many industries. Learn what it can mean for your business.
