For Maintenance Efficiency, the Asset Hierarchy Is King

By: Taylor Short on March 28, 2019

Maintenance managers striving for greater efficiency know leveraging asset data is the key to a strong predictive maintenance (PdM) strategy. Using a modern CMMS or EAM system, all of this condition data about your most important assets reveals the precise maintenance schedule that can cut your emergency breakdowns by 75 percent.

But as you implement a more proactive strategy, don’t forget to build an asset hierarchy—a logical index of every machine and component that is critical to understand how action on one machine affects the others.

Asset management teams who build an asset hierarchy can more easily track machines, schedule equipment efficiently and identify the true root cause of failures and prevent expensive breakdowns. We offer three tips to build it correctly from the start.

What Is an Asset Hierarchy? Why Is It Valuable?

An asset hierarchy is a way to organize all the machines, equipment and individual components owned by a company in one or more locations. The top-down structure allows maintenance professionals to understand the relationship among assets using “parent-child” logic.


But what’s the point? Building a hierarchy in a way that benefits your maintenance operations takes time, but it’s worth the work when you consider the following benefits:

Smarter asset life cycle decisions: A complete inventory of components in your most valuable equipment helps you understand and record normal wear versus potential failures.

More efficient asset scheduling: Understanding the relationships among your assets allows you to schedule maintenance so that it causes the least amount of downtime for other machines.

Identify root causes quicker: If you know all the components and replaceable parts in each machine, you can inspect all the possible culprits and identify the true problem.

Understand the true costs of maintenance: You can see exactly which parts and components are repaired frequently for a more detailed view into maintenance costs.

The actual machine data and hierarchy structure lives in your maintenance software, so you can add and edit information over time. And with mobile access to the CMMS or EAM, each technician can view the hierarchy anytime they perform to increase consistency in repairs.

3 Tips for a Valuable Asset Hierarchy

For the most immediate results, it’s best to create this hierarchy as you update your maintenance software or revamp your entire strategy (such as optimizing your preventive plan). These three tips help to ensure the register is scoped properly and data quality remains high.

1.Establish a Logical Structure and Uniform Names

If you already use a maintenance system and have asset profiles, a major part of the task is already complete. If you’re just getting started, keep in mind, asset profiles should match the structure of your hierarchy.

The organization standard for the petroleum industry—ISO/DIS 14224—is commonly used by manufacturers and other industrial companies, as well as many software vendors, as a framework to create the hierarchical structure.

It’s important to keep in mind: this ISO standard doesn’t factor in your site’s specific setup or purpose. So deciding whether the controller inside a brushless motor should be considered a child to the parent motor, or if both parts should be a single asset, depends heavily on your situation and goals.



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eMaint X3 asset profiles include fields for the equipment’s subcomponents and parent assets (Source)

Along with a specific location in the hierarchy, each asset also needs a unique identifier. Modern maintenance software typically includes functionality to assist with this typically by adding a sequential number for each asset.

But, a random number doesn’t convey any information on its own. After you identify the assets to be included in the hierarchy, you can assign recognizable codes for each, For example:

  • Boiler-1

  • Forklift-4

  • Conveyor-2-3

Unique identifiers like these communicate a clear meaning: Conveyor is the type, it’s the second of that type and it’s located at the third plant. A logical structure based on your situation, along with a meaningful and consistent naming standard, create the foundation for a valuable asset hierarchy.

2. Include Only the Assets and Data You Need to Perform Efficiently

At this point, you may be ready to start adding every piece of equipment you could possibly create a work order for—but slow down! It may seem prudent to enter everything for the full view of your assets, but doing so will only complicate the system.

So what should you include?

First, the most obvious candidates are your critical machines, the ones that would cause the most disruption and cost the most to repair once they fail. Tracking these closely prevents expensive downtime.

Second, include your most numerous assets. These should be tracked closely so you can understand how to keep the majority of your equipment running for as long as possible.

Third, go back to identify and add the repairable or replaceable components and parts for these assets. It’s more valuable to have a smaller hierarchy with depth for each asset than a fully populated one with little data for each machine.

We have a few resources to help with asset selection:

  1. You can start with an estimate for how much failures and asset downtime costs your company. Our Downtime Calculator can help prove the value of an asset hierarchy to enhance your proactive strategy.

  2. Next, you can rank your assets based on the likelihood of a failure, how difficult that failure is to detect and the severity of the failure to calculate a Risk Priority Number—the higher the number, the closer you should track that particular asset.


    Our RPN Calculator prioritizes your assets based on the impact of failures

  3. Finally, you can estimate the actual ROI of a predictive strategy to get buy-in for new maintenance software or prove the value of an asset hierarchy.

3. Audit and Update the Hierarchy Regularly

Any centralized data source requires a person or small group of “owners” in order for it to stay valuable. The specific person(s) you choose depends on the makeup of your maintenance team—it could be your single maintenance manager, or a reliability-focused professional in a larger multi-location organization.

Either way, this person should be someone who uses the hierarchy often and has a strong sense of which assets are currently in use.

Why? Because this person should be responsible for at least scheduling regular audits of the hierarchy (if not performing the audits personally), which include:

  • Adding new assets/removing old assets: As processes change and improve, and old machines are replaced, new machines will need to be added and others will be removed in the hierarchy to match.

  • Reviewing the hierarchy structure: Without an accurate structure, it’s too easy to miss important corrective maintenance tasks, lose track of costs or schedule preventive actions poorly.

  • Reviewing asset data in the CMMS: It’s critical that the existing assets you manage are reflected accurately in the hierarchy—be sure to remove or “deactivate” unusable machines in your structure.

Preventive Maintenance Optimization is a process designed to streamline scheduling by eliminating PM tasks that are redundant or ineffective—this may result in a change to your asset utilization, so it’s convenient to update your hierarchy at the same time.

After assigning a team to perform audits on the asset hierarchy, they can use the checklist below to ensure they’re recording the most important information about each asset.


Do You Need an Asset Hierarchy? Probably!

For maintenance organizations with a small number of very similar assets, building out a hierarchy may be more work than it’s worth. But the vast majority of teams with a variety of machines—multiple vehicle types, unique production equipment or facilities systems, for example—will find an accurate asset hierarchy valuable for years.

Even if this process seems overwhelming for your team, many CMMS systems include functionality to help you create and manage a hierarchy, tied to the asset data contained in the software. And if your existing maintenance system doesn’t offer it, you can browse our top CMMS products to see if it’s time to upgrade.

If you prefer more help, our maintenance software advisors are ready to help you find the best system based on your specific needs. Call (844) 689-4876 and speak with a real person to streamline your software search