Definitions

The intention of this chapter is to try and dispel some of the myths and confusion that surround the discipline of asset management and that of its measurement. There is often the perception that the objectives for asset management and, therefore, the best way to measure the fulfillment of those objectives, are obvious. This perception has been created over many years and is the result of two fundamental forces.

First, it has been contributed to by the perception that asset management is a one-size-fits-all discipline, whereby generic solutions can be transferred easily from one company to another or from one industry to another. This perception is behind much of the benchmarking efforts that are carried out throughout the world and is also partly to blame for the reduced level of corporate attention that the area receives. Second, many people working in the consulting areas of asset management do not originate from the field. This is particularly due to the technological revolution of the 1990s and has led to a large number of experts from fields such as IT or supply chain, or even data analysts, offering solutions to asset managers.

The resulting impact of these two areas has been that asset management solutions, and at time decisions, are taken based on incorrect premises, premises based on limited understanding that have fed the belief that asset management solutions are obvious. This chapter will focus first on providing some...