Are you a manufacturing company struggling to contain production and maintenance costs for your physical assets such as buildings and equipment? 

In challenging economic conditions, such organizations are often under pressure to reduce costs to meet their bottom line. 

Traditionally, asset management and facilities management are handled separately, but there is a compelling argument for combining these two functions. In this article, we explore the concept of an integrated facilities and asset management function to examine how you can achieve cost savings by streamlining your business processes and improving operational efficiency. 

To ensure availability of the facilities and assets required for production, medium to large organizations often rely on facilities management and physical asset management divisions, respectively. These services often operate in parallel despite sharing similarities in scope and required skillsets. 

 In manufacturing, the asset management team is often referred to as plant maintenance. Whether you process raw materials or produce fast-moving consumer goods, the success of your operation depends on people, processes, and technology that go beyond just buildings and infrastructure. To effectively manage both facilities and assets, you need competent people to plan and execute work, guided by best-practice processes and a system to coordinate activities and manage information. 

Figure 1: Interdependencies Between Facilities Management (FM) and Asset Management (AM) 

Figure 2 shows the Work Planning and Control business process. The main steps involved are identifying, planning, and executing the work. Both facilities and asset management teams follow this same process. Any maintenance task—whether facility-related or asset-related—starts at step one: an internal client submits a request. For instance, a typical facilities request might be a faulty air conditioner, while a typical asset request might be a defective production machine. Requests are routed to either the facilities manager or the plant (maintenance) manager, to be included in the work plan (step three) or, if urgent, for immediate execution (step six). Steps seven, eight, and nine follow to complete the workflow. In both cases, the maintenance process is the same and serves the same ultimate goal: enabling productivity to meet business objectives. 

Figure 2: Work Planning and Control Process 

 Table 1 below summarizes common measures and terminology identified in a study led by Julia Phala, Head of Sales and CRM at Pragma. 

Término	Contexto
Efficiency	Commonly used in physical asset management, refers to performing the right maintenance on the right equipment at the right time.
Productivity	Commonly used in facilities management, refers to the speed at which production is achieved by ensuring availability of necessary facilities or support functions.
Effectiveness	Refers to how well efforts result in reliability and availability, e.g., the extent to which planned activities are carried out and intended outcomes are achieved.
Consistency	Refers to achieving the same output quality by focusing on processes.
Compliance	Ensuring legal, statutory, and regulatory requirements.
Customer/Stakeholder Satisfaction	Satisfacer las demandas de los clientes o partes interesadas sin comprometer la calidad del servicio o la seguridad son clave para ambas funciones.
Return on Investment	Maximizing capital investment value by improving asset performance and output.
EAMS:  Enterprise Asset Management System tambien as well knowing to CMMS:Computarized Maintanance Management System	A computerized system used to manage production equipment throughout its life cycle.
CAFM: Computer-Aided Facilites Management System)	A computerized system used to manage facilities throughout their lifecycle.

 

Tabla 2: Common Terminology in Facilities and Physical Asset Management

In this case, the elevator and overhead crane fall under facilities management, while everything inside the production safety zone is handled by plant maintenance. Both teams aim to ensure equipment and facility uptime to support production—but their processes are disconnected.

For example, the plant manager schedules a 3-hour maintenance task on a production line. Unaware of this, the facilities manager schedules preventive maintenance on the elevator and crane. As a result, the plant maintenance team cannot access the equipment, and the originally planned 3-hour task stretches into three days or even three weeks—disrupting production. Using an industry example, with average automotive downtime costs of $21,174 per minute, this translates to a $127,044 loss per hour—or over $3 million in a 24-hour cycle—not counting unproductive labor.

Example 2: Making the Most of Skilled Resources

As shown in Table 2, both FM and AM require mechanical and electrical engineering skills. Let’s examine potential cost savings from sharing these resources instead of maintaining separate teams.

Assume FM has two mechanical techs, two electrical techs, and ten general workers. AM has the same setup. With average wages at $7.85/hour, the combined annual salary would be $281,510. If both functions are integrated—using one technician per discipline across both FM and AM—the salary bill is reduced by $60,323 annually.

Further savings can come from merging operational roles. Instead of 20 workers, only 10 are employed: five each for mechanical and electrical work—saving an additional $80,431 per year. To succeed, retention strategies and change management are essential to drive mindset shifts across both divisions.

The study also revealed that business leaders are open to integrating FM and AM. Particularly in manufacturing, companies stand to gain significantly from integration. Key value drivers include:

• Streamlining core processes like Asset Register Management, Work Planning and Control, Spare Parts Management, and Contract Management
  – Optimizing software by using one EAMS/CMMS system instead of multiple platforms
  – Cross-training and assigning human resources by engineering discipline and equipment class (e.g., criticality A, B, C)
  – Sharing skilled contractors across both divisions rather than duplicating them

Figure 3: Insights from the Asset Management Congress

As the examples show, a siloed approach to facilities and asset management is costly. To make the proposed improvements work, a central coordinating function at the strategic level is required. Figure 4 illustrates a leaner, combined FM and AM division.

A simplified, integrated process can result in significant cost savings. When automated, it can eliminate waste. Ultimately, both FM and AM functions exist to maximize return on investment by ensuring productivity, compliance, and stakeholder satisfaction.

Figura 4: Proposed Facilities and Asset Management Structure