Improving Organizational Effectiveness of Asset Life Cycle Management

Managing capital assets throughout the asset life cycle requires a number of competencies. Owner companies maintain many of those competencies in their engineering and project organizations. These organizations are often involved in generating and maintaining assets. Over the last two decades owners have outsourced much of their project related work as the contracting community marketed engineering, construction and project management capabilities to facility owners. At one time, many owner companies did most of the construction work in-house. An owner company performing construction in-house is now considered an anomaly. For many engineering and project competencies the decision to outsource is not as easy as it is for construction. The owner-contractor work structure process was developed to evaluate owner and contractor competencies and determine the best possible sourcing strategy for each competency in the owner's capital program. This paper illustrates the successful application of the owner-contractor work structure process by a power company. The power company used the process as one tool to develop a strategy for improving the performance of their operating facilities by designing effective capital projects and outage management organizations.