Future Trends in Asset Management for 2021 and Beyond
2020 has been a year of unprecedented agility and evolution as existing digital transformation initiatives were pushed into over-drive by efforts to pivot and adapt operations in the wake of COVID-19.
Nowhere is this truer than in the world of asset management, in which companies were forced to adapt to remote environments, increase safety protocols, maintain compliance to strict distancing regulations and more. But this seems like an extreme reaction to a very unique and impermanent situation – which begs the question, which of these changes are here to stay and what new trends should we expect in 2021 and beyond?
A Look Back: Asset Management Over the Last Decade
The last decade has seen the Fourth Industrial Revolution of artificial intelligence (AI), Internet of Things (IoT), advanced robotics and automations in full swing, with companies deploying digital transformation initiatives to stay with the times. But deployments have been inconsistent and varied, with many corporations continuing to rely heavily on the legacy, disparate and on-premise systems they had initially deployed.
Additionally, there has been a surprising resistance to adopting these new technologies and practices despite the plentiful statistics proving the benefits of latest asset management tools.
Many companies, for example, are reticent when it comes to utilizing mobile technology within the maintenance management lifecycle even though it’s been proven that mobile tools could save time in the field and largely eliminate downtime due to incomplete information. Similarly, organizations often refuse to centralize their compliance-related documents despite constantly scrambling for information when it’s time for a compliance walk-through. The point? The resistance has been widespread and consistent, so legacy tools have largely remained in play (and you can read more about why the maintenance management industry is scared to adopt technology in the face of organizational evolution here).
The COVID-19 pandemic has changed this in many ways. Overnight, people were no longer able to be on the facility floor, and operations that always relied on pen and paper had to go remote. In some senses, it was a complete overhaul. From another perspective, though, it could be argued that the pandemic simply fast forwarded the digital transformation processes that were already in play and forced the hands of the organizations that continued to drag their feet and resist change.
With all that in mind, here’s what the future may look like.
9 Asset Management Trends for 2021 and Beyond
1.There Will be Increased Focus on Creating a Highly Skilled Team
Particularly in the manufacturing industry, there is a growing and costly skills gap: Baby Boomers are aging out and taking their skills and knowledge with them. What's more, younger generations are uninterested in replacing them – and poorly trained when they do get the job.
The result? A Deloitte study reveals that the skills gap may leave an estimated 2.4 million positions unfilled between 2018 and 2028, with a potential economic impact of $2.5 trillion.
In the next decade, this skills gap will be necessarily closed, with an increased emphasis on technology/computer skills, digital skills, programming skills for robots/automation, working with tools and technology, and critical thinking skills. This will also involve:
- Improved training and onboarding
- Intuitive digital systems
- The use of digital tools like augmented reality to improve training and attract digital native top talent
- A continuous reassessment of talent strategies
- A mix of tried-and-true old-school talent and a new wave of digital native employees
Overall, this shift will allow companies to effectively execute a hybrid model of business that will see people and machines working side-by-side to foster innovation and achieve lasting business growth.
2. Operating Models Will Shift Rapidly
The world of asset management is always shifting, with ever-changing customer expectations, new competition and updated technology constantly disrupting and altering the broader landscape. Yet many business’ operating models stay surprisingly static and unresponsive.
This should shift for forward-thinking businesses in 2021 and beyond as businesses begin to transform their operating models to become more adaptive and fluid. Some key shifts to the operating model will include:
- A reconsideration and increased focus on core and differentiating activities, with no-value activities falling by the wayside
- A modernization of company-wide core capabilities
- Targeted changes based on data and analytics
- A move to a model that is in constant conversation with the broader context and digital evolutions
3. Only the Most High-Value Operations Will Stay
In the same vein, low-value functions, costs, positions and tools will fall by the wayside. This is especially necessary in the lean context most companies find themselves in: budgets are tight, technology is expensive and it is both unfeasible and unsavvy to keep anything that’s not yielding a high return-on-investment (ROI) or an improved customer experience. That’s why any value drains will be swiftly kicked to the curb (regardless of if it’s “always been done that way”) and any trapped value will be quickly identified and released.
These decisions, of course, will be informed by data and analytics – and things like automation, AI and outsourcing will certainly play a role in replacing low-value operations.
4. Primary Revenue Streams Will Be Reconsidered
Many companies have also remained fairly static when it comes to their product mix, their primary revenue streams and their distribution channels. This too will change as businesses are pushed to use the data and pursue the revenue opportunities and investments that will bring the most revenue.
For many, this will likely mean new, innovative products that are more competitive or in higher demand in the face of ongoing innovation and unexpected new competitors. Looking even more broadly, it may even mean monetizing capabilities beyond their standard operations. For example, by licensing proprietary software or even providing manufacturing capabilities for other businesses, businesses can diversify and ultimately see more growth and revenue.
5. New Technology Will Be Intelligently Deployed
New and emerging technology is really one of the sharpest double-edged swords of the modern era. On one hand, it represents unprecedented capabilities and opportunity for growth. On the other, an unproven and underperforming drain on resources – particularly if it’s incompletely adopted or poorly deployed.
The next decade will see a more discerning focus on mature technologies that are properly configured to increase revenue, execute strategies and improve overall operations. AI, analytics, automation – it will all be deployed more effectively to increase flexibility, decrease costs, maximize transparency and support strategic growth.
In particular, expect to see growth in business-wide solutions rather than stand-alone software. This tech will be well-integrated with your broader technological ecosystem, agile and focused on personalizing the customer experience.
6. Company Cultures Will Shift
Many companies today still face, “internal silos, resistance to behavioral change and the lack of an open culture in which knowledge is shared.” This will have to change from the top-down as companies reconfigure their businesses to create cultures that embrace ongoing change.
Here, the key is to:
- Focus on results and respond to data
- Align tools to suit the needs of larger strategies
- Get employees used to ongoing changes in tools and processes
In short, to create a culture of change.
7.Comprehensive Data Will Be the Focus
Data must be at the heart of all endeavors in the next decade: comprehensive, visible, enterprise-wide data that’s clean, trustworthy and uniformly governed. This is a point where many businesses today continue to struggle. According to a MicroStrategy survey, only 57% of businesses think that their data strategies are on par with their peers – even though 94% of businesses acknowledge that data is important to their business growth.
Yet getting this under control is essential to scaling a modern business, fostering innovation, automating and utilizing data-driven insight.
8.There Will Be A More Uniform Move Toward Preventive Strategies
We’ve spoken extensively in the past about the damage of reactive maintenance strategies and the immense need for forward-thinking, preventive maintenance. The overarching idea here? That preventive maintenance will reduce unplanned downtime, lower costs, increase safety, improve labor efficiency and extend asset life.
In the next decade, this shift toward preventive and predictive strategies will take place more broadly within an organization’s operations. Cyber threats, investor relationships, asset maintenance – it should all be managed proactively using data and predictive technologies.
This will keep businesses from being caught unaware and from managing crises rather than catching them and avoiding them from the start.
9. CMMS and EAM Systems Will Reach Their Next Generation
Gone are the days when CMMS systems worked simply on basic maintenance planning and EAM systems were clunky and had to manage. The next generation of CMMS and EAM tools will offer advanced, top-to-bottom capabilities, including key features like:
- Capital planning: Organizations must be able to accurately understand their asset spend and streamline their budgets. CMMS and EAM systems will help organizations get a handle on these numbers and better allocate spend.
- Digitization of maintenance processes: Automation and comprehensive insight are your friends. To get these things, though, you must effectively digitize and integrate your workflows, knowledge management tools, work histories, reporting, analytics – everything.
- Engineering document management: During the handover process, most engineers or contractors simply hand over a big pile of asset related documents – and your team is left frantically sifting through that information every time something breaks or you need to complete a task. This will change as powerful EDM tools are integrated into CMMS and EAM systems.
- IoT monitoring: IoT can essentially enable real-time or near-real-time communications between devices. This can increase your interoperability and real-time insights – so IoT monitoring will be a worthwhile investment for many.
Final Thoughts: How to Make Sure Your Business Is Ready
Asset management has always been an ever-changing industry – and this will certainly remain the case moving forward. In order for your business to thrive in the coming environment, you must foster a culture and a corporate environment that is agile and willing to embrace change and constant adaptability.
After all, no one knows exactly what the future will bring. We only know that it will be different and ever-changing. The companies that acknowledge this fact and focus on maintaining long-term adaptability are the ones that will thrive.
Download our free eBook to help you evaluate and improve the effectiveness of your maintenance management programs by providing key insights gained from organizations and industry peers that are leading the charge in asset maintenance and management efficiency.