What is Asset Management?
Asset management is the governance of all entities, items and goods designated as having value, and that fall under an organisation’s responsibility. It is the systematic approach to develop, operate, upgrade, maintain and dispose of assets cost-effectively. This includes all risks, service/performance attributes and costs associated with an asset and covers;
- Tangible Assets: Property, factory equipment, computers, technology, servers, furniture etc.
- Intangible Assets: intellectual property, trademarks, copyrights, human capital, goodwill, brand value etc.
What is Financial Asset Management?
Any organisations with sufficient assets – tangible or intangible – employ an asset manager to handle this function. Often the asset manager is also responsible for the investment management strategies of an organisation. It can be either active or passive.
- Active management: Assess an organisation’s assets to oversee, plan and create strategies for investments based on its financial health.
- Passive management: Mirror markets, index funds or other low involvement investment strategies are adopted and allocated for use. This strategy is adopted when an organisation does not have the time or resources for Active management.
What is Infrastructure Asset Management?
Infrastructure asset management combines finance, economics, engineering and management practices. It applies these practices to physical assets in order to optimise service levels and the value of goods for within the cost constraints.
This function oversees the complete life cycle of all infrastructure and physical assets, including;
- Design of object or infrastructure
- Its construction
- Operations management
- Maintenance and Repair
- Modifications and upgrades
- Disposal or deconstruction
Financial Asset managers and Infrastructure asset managers need to collaborate in order to efficiently manage the resources provided to meet the organisation’s objectives. Additionally, organisations that offer turnkey solutions to clients require both departments to work cohesively in order to maximise profits.