The plant asset management market is expected to grow at a CAGR of 11.2% during the forecast period (2021 - 2026). The importance of physical asset management to a company’s success has increased over recent decades. Automation is one reason for this trend, as it has forced industries to delegate more tasks to machines, thereby making maintenance more crucial. Companies are increasingly turning to plant asset management as an optimization strategy to improve their process efficiencies, reduce maintenance costs, thus enhancing their return on investments/assets. Companies are known to have reported almost a 30 percent reduction in maintenance budgets and up to a 20 percent reduction in production, downtime owing to a robust plant asset management strategy. Controls and Automation will be harnessed almost everywhere to collate complex real-time data and automate actions for plant performance enhancements in the coming time.
- The adoption of real-time data analytics is driving the market. For the most part, a model of an asset or a process is created in the software program that predicts what the value of output should be based on the current data. If there is a significant difference (anomaly), an alarm or warning is raised. The data sources include equipment sensor readings, process instrument readings, distributed control system data, equipment control systems data, and computerized maintenance management system data.
- The data used is not “Real-Time” as per an instrument or control system data, but called “Near Real-Time" and are mostly used by site based method and cloud-based method in the predictive analytics. This helps the company to monitor critical assets.
- Further, the adoption of lean manufacturing practices is driving the market. Companies that implement lean manufacturing principles should consider an asset management solution to help improve reliability while optimizing the cost of maintenance and operations across a wide range of asset classes.
- For instance, IBM Tivoli software portfolio, IBM Maximo Asset Management supports and executes successful lean manufacturing principles by pulling information from ERP and plant information systems into asset management software. Maximo Asset Management helps to maximize the performance of fixed, physical, or other capital assets that have a direct and significant impact on achieving corporate objectives and strives to maximize performance for the lowest total cost of ownership.
- However, the lack of skilled personnel is the factor hindering the market growth. In a report titled 'The Future of Jobs 2018', the World Economic Forum (WEF) said that around 54% of the global workforce had to be re-skilled or up-skilled to work in disruptive and digital technologies spawning the virtual world. There is less acceptance from operators due to a lack of technical knowledge.
Key Market Trends
Oil and Gas Accounts For Significant Market Growth
- In the oil and gas industry, the process plants are quite complex and consist of expensive and production critical equipment. As the plant's condition and performance degrade over time due to wear from several factors, this harms the production and the costs associated with it. Asset management strategies aim to counter this impact by systematic condition monitoring of equipment, avoid unplanned production downtime, and to reduce operational expenses by optimizing maintenance planning.
- According to OPEC, the world refinery capacity expanded by 876,000 barrels/calendar day (b/cd) to stand at 99.51m b/cd during 2018. The Asia and Pacific region, as well as the Middle East, contributed the most in terms of refining capacity additions. Further, with increasing capacity, the demand for asset management is highly required.
- Based on the US Department of Energy, predictive maintenance is up to 40% more cost-efficient than unplanned maintenance and up to 12% more cost-efficient than planned maintenance. To put these into perspective, cost savings can be achieved from the increased lifetime of the equipment, which in turn has savings from the reduced spare parts inventory.
- Further as systems across facilities are upgraded over time, the intelligent devices that make-up those systems are now capable of capturing data and forwarding it to the cloud at an affordable price. Operators just need to determine the best ways of consolidating, analyzing, and managing that asset information. The goal is to convert the asset management data into actionable plans and increase the lifespan of equipment.
- Companies like Emerson announced its new DataManager v8.2 analysis software solution for refineries. Notably, the software solution helps in minimizing the risk of potential acid leaks by tracking corrosion of hydrofluoric acid alkylation units, which allows refinery operators to prevent accidental shutdowns and better estimate the lifespan of equipment, thus securing the safety of their workers.
- Moreover, with increasing refinery throughput of crude oil in India year to year, according to the Ministry of Petroleum and Natural Gas (India), the market for plant asset management increases. Players such as SGS SA provide support with distribution and retail, including calibration services, facility audits, leak detection, and maintenance to the oil and gas sector for the downstream sector.
North America to Hold Significant Market Share
- Plant Asset Management is becoming easier due to advancements in the cloud in this region. It exhibits a tremendous potential to add value and help companies reduce the cost and improve operational efficiency.
- Companies are introducing new cloud solutions exhibiting to improve productivity. Recently Honeywell introduces New Enterprise Performance Management Software that will transform business operations. Its cloud-based Honeywell Forge allows users to optimize their enterprise on a single screen using advanced data analytics and converts massive quantities of data from equipment, processes, and people into intuitive, actionable insights that enable monitoring of operations from a single screen.
- Companies in North America are also focusing on purpose-built asset management software that is ready to scale and is required for transformation within the organization. For instance, in March 2020, Emersion unveiled its latest data visualization software solution for flow measurement known as Micro Motion ProcessViz. Notably, the software solution facilitates quick identification of a problem in the flow process for plants belonging to various industries, including chemical, oil & gas, and food & beverage.
- Further, North America has one of the oldest midstream infrastructures, with many oil and gas pipelines older than 40 years. The upstream infrastructure in the country is also aging. Most of the active platforms in the Gulf of Mexico are older than 25 years. This enhances the demand for plant asset management in this sector, contributing to the growth of the market.
The plant asset management market is fragmented with many global players, and every industry is embracing its control and administration of plant assets to another vendor to optimize productivity. Further, players are continuously offering new innovative solutions that maximize market rivalry. Key players are ABB Group, Emerson Electric Co., etc. Recent developments in the market are -
- November 2019 - Yokogawa delivers a new plant asset management solution known as Plant Resource Manager (PRM) that enables digital transformation in IIoT-era applications. PRM will effectively digitalize and analyze big data from all remote assets, support predictive maintenance, and optimize process operations.
- September 2019 - Emerson introduced the AMS Asset Monitor edge analytics device, which digitalizes essential asset data and analytics for better operations performance and improved decision making. AMS Asset Monitor provides actionable insights into essential assets that were previously monitored only with infrequent assessments. The new edge analytics device will connect with Emerson’s Plantweb Optics asset performance platform to provide key operations personnel with instant asset health details for operations and maintenance decision making.
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Table of Contents
1.2 Study Assumptions
1.3 Scope of the Study
4.2 Market Drivers
4.2.1 Adoption Of Real-Time Data Analytics
4.2.2 Adoption of Lean Manufacturing Practices
4.3 Market Restraints
4.3.1 Lack of Skilled Personnel
4.4 Industry Value Chain Analysis
4.5 Industry Attractiveness - Porter's Five Forces Analysis
4.5.1 Threat of New Entrants
4.5.2 Bargaining Power of Buyers/Consumers
4.5.3 Bargaining Power of Suppliers
4.5.4 Threat of Substitute Products
4.5.5 Intensity of Competitive Rivalry
5.3.1 Energy and Power
5.3.2 Oil & Gas
5.3.4 Mining and Metal
5.3.5 Aerospace and Defense
5.3.7 Other End-Users
5.4.1 North America
5.4.4 Latin America
5.4.5 Middle-East and Africa
6.1.1 ABB Group
6.1.2 Emerson Electric Co.
6.1.3 Honeywell International Inc.
6.1.4 Rockwell Automation, Inc.
6.1.5 Siemens AG
6.1.6 SFK Group
6.1.7 Ramco Systems
6.1.8 General Electric Co.
6.1.9 Endress+Hauser AG
6.1.10 Schneider Electric SE
6.2 Investment Analysis
A selection of companies mentioned in this report includes:
- ABB Group
- Emerson Electric Co.
- Honeywell International Inc.
- Rockwell Automation, Inc.
- Siemens AG
- SFK Group
- Ramco Systems
- General Electric Co.
- Endress+Hauser AG
- Schneider Electric SE