How new advances in Asset Lifecycle Management (ALM) technology will evolve the performance and profitability of asset-intensive industries in 2025 and beyond
In Q3 of 2024, IFS acquired Copperleaf, the world’s leading Asset Investment Planning (AIP) solution, triggering an acceleration of innovation that will forever change ALM technology as we know it.
While it may seem self-serving to focus my 2025 predictions on an IFS initiative—with a front-row seat to the acquisition and resulting technology roadmap—I believe merging traditional ALM with AIP, in the deep domain capabilities of IFS, represents a lasting advancement for asset-intensive and risk-critical industries worldwide as the only complete ALM offering on the market.
My predictions for 2025 relate to three distinct yet interrelated benefits IFS customers will derive from fully end-to-end ALM:
Prediction #1: Capital efficiencies will improve by at least 5%
Maximizing capital efficiencies is a significant competitive differentiator. The concept is simple enough: measure how much money is put into the business versus how much money is generated from the investment. When capital efficiencies improve, so does profitability.
Nearly half of growth corporates (companies with annual top lines of $50 million to $1 billion) improved operational efficiencies by using working capital to more predictably manage cash flow and fund strategic investments. Visa: The Growth Corporates Working Capital Index 2024-2025
IFS ALM, underpinned by Industrial AI, helps to inform capital planning, enabling the strategic allocation and execution of CAPEX and OPEX to balance expenditure, business objectives, risk, and optimal asset performance.
The system generates rich analytics derived from enterprise asset management (EAM), AIP, asset performance management (APM), planned preventive maintenance (PPM), and other applications to support data-based decision-making. With end-to-end ALM, the company explores the past, the present, and the future, examining different probabilities and comparing outcomes.
For example, an electrical utility weathered a devastating wildfire that consumed a significant portion of its operating budget, impacting planned capital projects and day-to-day operations. In building its plan for the upcoming year, the utility needed a resilient strategy to accommodate the unexpected.
With end-to-end ALM, the company can overlay its business strategy across various what-if scenarios. If the utility encounters another disaster, it will know which projects to deprioritize to help rebalance the budget and which must be maintained to deliver optimal value.
IFS ALM helps to inform and guide operational, tactical, and strategic decision-making, with the potential to increase capital efficiencies by an estimated 5%.
Prediction #2: Greater accuracy and resiliency in project cost projections will save the business a minimum of 15% in overall costs
Accurate project cost projections go hand-in-hand with better capital efficiencies. After all, an improved project costing mechanism frees up funding to invest in capital projects.
The emphasis is on planning (and spending) to ensure effective capital efficiency execution. Inaccurate project cost projections result in expensive schedule and budget overruns, unfortunately a common outcome for over 90% of large projects.
When building a project cost projection, all requirements must be analyzed and incorporated. Along with equipment, parts, and other hard costs, planners must accurately predict the project timeline, the required number of skilled and unskilled workers, and other potentially fluid requirements that impact the efficiency and ultimate success of the project.
IFS ALM is built upon a composable framework that natively incorporates industry-leading applications, for example, EAM, enterprise resource planning (ERP), field service management (FSM), and other capabilities such as project performance and portfolio management to help inform capital investment plans.
Along with real-time data that reflects the state of enterprise assets, inventories, and workforce dynamics, IFS ALM supports predictive analyses, factoring in the potential of market volatility based on industry trends, geopolitical, and other factors such as global warming and environmental risks.
IFS ALM customers access a dashboard that incorporates all of the data needed to inform project cost decision-making, supplying critical data to quantify project timelines, risk factors, and alternative strategies if the unexpected occurs. The data is simplified and streamlined within the composable IFS Cloud environment.
In 2025, with full end-to-end asset lifecycle management technology, project managers will more accurately identify potential cost overruns and risks before and during a project, resulting in significant savings for the business.
Prediction #3: Maintenance capacity will expand by up to 30%, supporting full cycle methodology (1.0 to 5.0)
Even with the best maintenance model, unexpected events occur, forcing unplanned downtime and other inefficiencies, all taking their toll on the bottom line.
For example, industrial manufacturing facilities average about 800 hours of unplanned machine maintenance and downtime annually or about 20 monthly downtime incidents.
While improving these outcomes requires detailed insight into the real-time state and condition of enterprise assets, the company must also be strategic in its maintenance response.
IFS ALM optimizes visibility, delivering robust analytics on the state and condition of assets. A streamlined data model enables a more strategic approach to deploying and directing maintenance resources. Even if the company has achieved a Maintenance 4.0 proficiency, elevating every event to this response level may not be the most sensible approach.
IFS ALM delivers deeper insights, extending beyond a single event to understand how every asset’s performance impacts the business’s overarching goals. The company makes informed decisions with these insights, assigning the appropriate maintenance methodology and response. Some assets may warrant a predictive and proactive model, while preventive maintenance—or even running an asset to failure—may be appropriate for less critical components.
An expanded maintenance methodology creates significant efficiencies in capacity—estimated at up to 30%, allowing the business to apply time and resource savings to higher-value work. Instead of focusing on a singular maintenance strategy, IFS ALM supports a broader and more agile approach to asset maintenance.
Summary
IFS ALM is the market’s first and only fully end-to-end asset lifecycle management solution. In 2025, we will see asset-intensive companies leverage these new capabilities to enable unprecedented accuracy and resiliency in project planning and execution. For more information about IFS ALM, read the executive summary. Happy 2025!
