Definitions of Asset Management

One of the single largest problems with Transportation Asset Management is defining what that word actually means. We define it as “simply bringing relevant data and analytic tools together with systematic implementation processes to ensure that the defined goals of the system are attained as efficiently as possible.”

Transportation managers have been establishing system goals, analyzing system conditions, making investment decisions and implementing projects since the beginning of transportation agencies. The challenge is to help those managers understand how meaningful system goals can be established to meet the needs and desires of the traveling public; to help them gather and use the most relevant information; to help them use the best analytic tools; and to help them understand the most efficient implementation processes.

Here are just a few of the many definitions offered for asset management:

AASHTO and US-FHWA: Asset management is a systematic process of maintaining, upgrading, and operating physical assets cost-effectively.  It combines Engineering principles with sound business practices and economic theory, and it provides tools to facilitate a more organized, logical approach to decision-making.  Thus, asset management provides a framework for handling both short- and long-range planning.

TRB: Asset management is a systematic process for maintaining, upgrading and operating the physical assets of a transportation system. Asset management employs engineering principles, economic theory, sound business practices, and information systems to determine short and long term resource allocations.

APWA: An asset is a physical component of a facility which has value, enables services to be provided, and has an economic life greater than twelve months. Assets management is a methodology to efficiently and equitably allocate resources amongst valid and competing goals and objectives. OR Assets Management is a methodology to efficiently and equitably allocate resources amongst valid and competing goals and objectives.

WMS, Inc. : Asset management is the programmed approach to operating, preserving, and restoring physical assets to meet predetermined standards.

UK Highways Agency: Asset management is the systematic process of maintaining, upgrading, and operating assets, combining engineering principles with sound business practices and economic rationale.

Booz, Allen, & Hamilton: Asset Management—management system to achieve an organization’s business objectives and cost effectively manage assets throughout the life cycle of:

  • Identification of need for an asset
  • Design and planning
  • Acquisition and, as necessary, enhancement of assets
  • Asset utilization including operation, maintenance, and improvement
  • Disposal of assets

Darrel Rensink, Iowa DOT, 1997: The sum of all those activities related to an asset’s life that result in a safe and efficient intermodal transportation system that contributes to the social and economic well being of its benefactors.

David Ekern, Minnesota DOT, 1999: An integrated set of processes and systems to achieve optimal and cost-effective use of assets throughout their service life, including identification of the need for an asset, acquisition enhancement of assets, utilization-operation, maintenance, and improvement, and disposal of assets.

Other Definitions:  The core components of asset management are data collection, preservation, economic analysis, management orientation, and integration.