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The Complex World of Managing Real Property Assets 

 A GAO report breakdown

A new report that examines whether federal agencies effectively manage billions of dollars in real property assets provides helpful tips for smaller organizations, such as municipal governments, seeking a framework to create their own successful asset management programs.

According to GAO-19-57: Federal Real Property Asset Management: Agencies Could Benefit from Additional Information on Leading Practices, publicly released on Nov. 5, 2018, benefits touching all organizational functions are derived from adopting best asset management practices. These benefits include gaining a fuller understanding of data to assess repairs and maintenance costs, making better-informed financial decisions that affect the welfare of the workforce, and coordinating short- and long-term goals that shape the organization’s future.

The 65-page U.S. Government Accountability Office (GAO) report compares best asset management practices, as reflected by the International Organization for Standardization (ISO) 55000 standards, an international consensus standard on asset management, with the actual practices of selected federal agencies such as the National Park Service and the U.S. Army Corps of Engineers. The report also taps 22 asset management experts and practitioners, selected for their depth of experience, for suggestions on propelling effective asset management practices into organizations.

Organizations adopting an asset management framework may face challenges arising from culture change or lack of capacity. The report discusses ways to circumvent those challenges to arrive at a satisfying solution. While smaller municipal governments may not manage the same level of assets as federal agencies, the GAO report identifies these six key characteristics that could help any organization achieve an effective asset management framework:

1. Establishing formal policies and plans: Organizations should have a clearly defined governance regime that includes a strategic asset management plan that ties to the organization’s mission and strategic objectives, defines the asset management scope, and defines the roles and responsibilities for each part of the organization.
2. Maximizing an asset portfolio’s value: Organizations should develop an asset management policy to identify the value of their assets to achieve their mission and strategic objectives and invest in those assets to derive the greatest value.
3. Maintaining leadership support: Organizational leadership should clearly articulate its support for asset management and provide necessary resources for asset management to succeed.
4. Using quality data: Organizations should collect, analyze and verify accuracy of asset data, including inventory and data on each asset’s condition, age, maintenance cost and criticality to the organization.
5. Promoting a collaborative organizational culture: Organizations should promote a culture of information sharing and enterprise-wide decision-making regarding their assets.
6. Evaluating and improving asset management practices: Organizations should evaluate the performance of their asset management system and implement necessary improvements.

The specific landscape of each organization determines the feasibility—and necessity—of including all of these components. I recognized that truth after seeing my team implement over 350 asset management programs across the United States and abroad. However, having defined targets is extremely important, because executing incremental improvements over time, based on long-term goals, is also a solid strategy. Implementing the findings in this report won’t happen overnight for any organization.

View the full report here.