Performance of physical asset management using the analytic hierarchy process

Abstract

Purpose The purpose of this paper is to explore certain resources, capabilities and competencies needed to improve the performance of physical asset management (PAM). Design/methodology/approach The analytic hierarchy process (AHP) is used to select and prioritize the most appropriate factors for improving performance. A multi-criteria approach is used to analyze and compare the importance of 6 main criteria and 18 subcriteria identified from a survey of relevant literature. Findings The study revealed that not all factors are viewed as having equal importance in improving PAM performance, as three of the main factors attained greater importance among the six factors. Research limitations/implications This study explored the factors required for managing assets only within the third stage of asset lifecycle, that is, the utilization stage. It is recommended that future studies be conducted in such a way as to determine the importance of similar factors in the other stages of the asset lifecycle, or to identify new factors and add new criteria. Practical implications Knowledge of the differential impacts of the factors on the performance of PAM can impact asset managers and decision makers in their allocation of resources and focus their work on the highest-ranked rather than the lowest-ranked factors. Also, AHP used provides an effective mean for asset managers to identify priorities among decision criteria in their organization. Originality/value To date, no study has explored the impact of six combined factors on the performance of PAM. Previous studies have found that these factors each had equal importance. However, their relative ranking in practice and when they appear together have remained unrecognized.

A real estate portfolio management risk assessment framework for nonlisted real estate funds in India

“…AHP has been used extensively in real estate and construction management research in the recent years and is an accepted and rigorous methodology. It has been used in communicating investment risk as part of the valuation process (Adair and Hutchison, 2005; Hutchison et al , 2005; Gupta and Tiwari, 2016), assessing CBD building quality (Ho et al , 2005), hotel investment decision-making (Newell and Seabrook, 2006), selecting facility location (Yang and Lee, 2006; Opasanon and Lertsanti, 2013; Chadawada et al , 2015), asset allocation (Chen et al , 2011), technical innovation in construction (Hardie and Newell, 2011), evaluating city competitiveness (Singhal et al , 2013), developing a workplace satisfaction index (Khamkanya et al , 2012), brownfield risk communication and evaluation (Wu et al , 2017), sustainable residential property development (Green et al , 2018), property investment decision-making (Hutcheson and Newell, 2018), apartment buying decision-making (Obeidat et al , 2018), physical asset management (Al Marzooqi et al , 2019), housing choice (Li, 2009) and project performance in a public–private partnership framework (Swamy et al , 2018).…”

Assessment on Factors Affecting Asset Management Performance in Malaysian Government Agencies: A Concept Paper

“…It implies that AM performance in the public sector is weak compared to other elements audited. Al Marzooqi et al (2019) opine that improving AM performance is a complex process and influenced by several factors, including employees training, effective maintenance practice, and workplace culture…”

An Analysis of Physical Asset Management Core Practices and Their Influence on Operational Performance

“…Physical asset management (PAM) has recently been considered as one of the most important sources of competitive advantage [1][2][3]. The relationship between PAM practices and organisational performance is an important issue, as researchers [3,4] have argued that the ultimate goal of PAM is to realize the value of an organisation's assets.…”

“…This is particularly true when considering the change from PAS 55 to ISO 55001, which covers any type of asset that has an actual or potential value to the enterprise. The development of PAM has been framed by the need for an integrated and holistic approach to PAM [2,9], a need to optimize the value of assets throughout their life cycle, in particular through the development and implementation of an AMS (e.g., [10]), the necessity to recognize the business value (i.e., financial payoff) [4], a need to reduce business risk and by the expectation to reduce the whole-life costs of assets [11,12]. However, from an Industry 4.0 perspective, asset management has gained considerable attention, particularly through the integrated and holistic approach to physical asset management [13,14].…”

“…Although recent studies have examined the performance of PAM [2,4], few have empirically investigated the impact of PAM practices on performance outcomes. Therefore, while there is evidence of a growing body of research on asset management issues over the past decade, to the best of the authors' knowledge, there is as yet no empirical research that addresses the specific issue of PAM practices and their link to operational performance.…”