What makes an effective asset management practitioner? Ruth Wallsgrove ,who founded IAM’s Asset Magazine in 2004, recently contributed this opinion piece to the magazine in which she shared some of her experience in working around the globe. Our thanks to IAM for permitting reproduction here.
On the steering group to review the IAM Competences Framework, we discussed the distinction between the things we needed to know about and things we actually have to be able to do for ourselves. That is between what we need to appreciate other people doing, and what we have to take main responsibility for.
A useful way I have found to think about asset management capabilities generally is: what won’t get done if we don’t do it? What key competences should we expect not to be there, if we don’t have them?
This means areas such as IT, Engineering and Finance are fields we should understand, but we don’t necessarily need to have hands-on skills or previous experience in them. There are plenty of other people, other professionals, looking after them.
On the other hand, we have to be the ones to understand good asset management practice, and to communicate this and its benefit across our organisations. Who else could do this? Communication, facilitation and change management of attitudes are often called ‘soft’ skills, but that doesn’t reflect how hard many of us find them in practice.
Information and risk
I have become increasingly interested in in two other areas vital for effective asset management that we cannot depend on anyone else to know how to do. They probably are not there anywhere else in our organisations, especially as applied to physical assets. And they are not in any sense ‘soft’.
First of all, we need to ensure we have the skills to understand what information about our assets can and cannot tell us. This isn’t about IT, data collection or even quality assurance, but about interpreting data. The realm of data science, including statistics, is crucial here. Some of the best asset managers I’ve worked with have exceptional data-analysis skills – some even teach data science at college or have backgrounds in military intelligence. Once you’ve seen a true expert in action, it’s clear that asset management is incomplete without these skills. (It’s a shame that many of us didn’t enjoy statistics in college!)
A second, related area of concern is risk management. The whole realm of managing physical assets has up to now been – well, how can I put this delicately – naive about risk. We still struggle to quantify risk, as if actuaries didn’t exist. The basic issue may not just be that we have been ignorant (and I am talking about myself here), but that we’ve been positively resistant to handling uncertainty.
Embracing uncertainty
Twenty years ago, Ype Wijnia from ProGas in the Netherlands alerted our community to the problem of relying on people who don’t like to work with uncertainty On those whose previous education, and maybe natural preference, leans towards knowing for sure, or relying on rules to give the right answer.
But that just isn’t asset management, it’s all about making decisions and planning for the future. The one thing you can be sure about is that you don’t know everything. You can’t know everything.
We have to ‘embrace uncertainty’, as Chris Lloyd, who previously chaired the IAM work on competences, put it – and use the tools and concepts for managing risk that have been there for years in other professions.
Looking across these key competences, i suspect we’ve relied too much on the skills that individuals bring across from engineering or finance. We’ve lingered too log in our old comfort zones. We should not expect that what we have learnt from previous education and experience is adequate on its own.
We should expect any asset manager to go on learning and exploring areas that may be quite different to what we’ve done before. New tools, new concepts, jumping happily into the unknown.
Curiosity may well be the most important asset management competence of all.
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