An asset’s life cycle refers to the sequence of stages in overseeing its management, starting from identifying the necessity for the asset and extending through its operational lifespan until its eventual disposal.
Monitoring an asset’s life cycle varies across companies and may not always be formalized, yet it remains crucial. Its significance is determined by factors such as the asset’s replacement cost, its pivotal role within the business, and its overall dependability.
Failure to maintain assets leads to unexpected breakdowns, causing delays and emergency maintenance for companies. Properly managing asset life cycles simplifies the maintenance and administration of valuable assets, benefiting all involved parties.
Each cycle differs depending on the specific asset. For instance, a comprehensive wrench set will have a distinct life cycle compared to a large, shorter-lifespan piece of machinery. Nonetheless, the life cycle stages remain consistent across assets, allowing similar principles to apply universally.
Asset Life Cycle Stages
Each asset undergoes four distinct phases during its lifecycle:
Though these stages appear straightforward, effectively managing assets across these phases can pose challenges. Let’s delve into each stage and its respective objectives.