Strategic Asset Management

Strategic Asset Management
NAME OF STUDENT:
NAME OF COLLEGE:
AUTHORS NOTE:
Running head: STRATEGIC ASSET MANAGEMENT

STRATEGIC ASSET MANAGEMENT
Contents
1.0 Introduction...............................................................................................................................2
2.0 Annotated Bibliography on Asset Management Strategy in Power Sector......................................3
2.1Journal Article 1................................................................................................................................3
2.2.Journal Article 2...............................................................................................................................5
2.3Journal Article 3................................................................................................................................7
2.4Journal Article 4................................................................................................................................8
3.0 Towards Effective Asset Management Practices – Lessons from Literature....................................9
4.0Conclusion......................................................................................................................................10
Bibliography.........................................................................................................................................10
1

STRATEGIC ASSET MANAGEMENT
1.0 Introduction
With aging infrastructure, rising cost of power generation and with requisite to react to
technological advancements, the power sector is facing several challenges which have
intensified pressure on power sector utilities, thereby making them think deeply to invest on
maintenance, growth and modernisation of their service delivery assets. With no letup in
safety and service parameters in context to customers, shareholders and stakeholder
expectations, the utilities in power sector are largely getting confronted to do more with less.
Hence asset management ability is required in power sector firms so that the much needed
change can be attained with essential optimisation of cost, risk and performance1. Also as the
power sector is rapidly transforming and growing the value chain is becoming complex so
investment in assets today will have cost implication in future. To increase investment in
asset management power sector firms require to interpret and administer overall life cost, risk
and value of assets. Also power sector needs to identify and react to R&D so that challenges
in asset management which is rising with persistent disruptive trends would be addressed in
better manner so as to lessen their impact on power sector. Moreover with improvement in
asset management more specific innovations and better performance in power sector can be
attained2. So power sectors need to undertake strategic approach to improve asset
management standards as several research have presented that embracing a compelling
initiative to asset management can produce more gains equivalent to 20% of overall
expenditure in three to five years and the outcomes attained would demonstrate focus on
better asset management which will remarkably improvise value. In this report various
current literature works will be examined and assessed pertaining to asset management
strategies in power sector and also discussion will be made to understand its various aspects
and best practices approach.
1 Denison, B (2019) Benefits of physical asset management in power generation. WSP
Available: http://www.wsp-pb.com/en/What-we-do/Strategic-Consulting/Insights/Benefits-
of-Physical-Asset-Management-in-Power-Generation/
2 PwC (2019) Strategic, integrated assets and operations- a must. PwC Asset and Operations.
Available: https://www.pwc.com/us/en/industries/power-utilities/assets-operations.html
2

STRATEGIC ASSET MANAGEMENT
2.0 Annotated Bibliography on Asset Management Strategy in
Power Sector
2.1Journal Article 1
Atmo, G., & Duffield, C. (2014). Improving investment sustainability for PPP power projects
in emerging economies. Built Environment Project and Asset Management, 4(4), 335-351.
doi:http://dx.doi.org/10.1108/BEPAM-10-2013-0051
In this article a Value for Money (VfM) framework is proposed related to implementation of
core strategies so as to attain better asset management through VfM from acquisition of
power generation projects by use of PPP mechanism in emerging Asian countries. Previously
as several PPP power projects had miserable outcomes due to broad issues like project
initiation, governance and financial arrangement, so, in this article the VfM drivers and their
associated facilitating characteristics have been framed relying on literature about VfM
drivers and Critical success factors of PPP projects to improve investment sustainability. The
proposed VfM framework in this article illustrates sustainable energy system so as to
promote better outcomes as desirable from PPP power projects such as efficiency,
effectiveness and economy. The proposed strategy particularly underpinned significance of
continued long term government commitment in order to execute PPP regulations archetype
in consistent manner throughout multiple levels of governmental enterprises. The article
clearly reflected that environmental sustainability has been impacted by availability of funds
in future PPP power projects and these require to use cleaner technologies to facilitate better
support from foreign financial bodies. Key VfM driver and proposed strategies for
implementation are:
3