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What is the Asset Management Process?

Asset management consists of the following five steps:

  1. Taking an inventory.
    Before you can manage your assets, you need to know what assets you have and what condition they are in. This information will help you schedule rehabilitations and replacements of your assets.
  2. Prioritizing your assets.
    Your water system probably has a limited budget. Prioritizing your assets will ensure that you allocate funds to the rehabilitation or replacement of your most important assets.
  3. Developing an asset management plan.
    Planning for the rehabilitation and replacement of your assets includes estimating how much money you will need each year to maintain the operation of your system each year. This includes developing a budget and calculating your required reserves.
  4. Implementing your asset management plan.
    Once you have determined how much money you will have to set aside each year and how much additional funding (if any) you will need to match that amount, you need to work with your management and customers and with regulators to carry out your plan and ensure that you have the technical and financial means to deliver safe water to your customers.
  5. Reviewing and revising your asset management plan.
    Once you have developed an asset management plan, do not stick it in a drawer and forget about it! Your asset management plan should be used to help you shape your operations. It is a flexible document that should evolve as you gain more information and as priorities shift.

This guide provides information and worksheets that will help you complete all five steps. As you work your way through this guide, you should remember that the suggestions provided and the results you develop based on the worksheets are not set in stone. You should adjust your plan based on your own experience and the particular characteristics of your system. In addition, you should reevaluate your plan every year, updating each of the worksheets.

Contact your State or Regional Tribal Capacity Development Program Coordinator through Primacy Agencies or Tribal Contacts for more information or assistance, or other sources of information on asset management in this guide.

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How does Asset Management relate to Strategic Planning?   Step 1 – How Do I Inventory My Assets?