Types of assets, and project deliverables as assets,
in an organisational context
FEATURED PAPER
By Alan Stretton, PhD (Hon)
Sydney, Australia
INTRODUCTION
In a recent article in this journal (Stretton 2021k), I included discussions on longer-term organisational external effectiveness strategic initiatives and their associated assets, which are basically physical fixed assets. In that article I used the following Wikipedia definition of fixed assets.
Fixed asset: A fixed asset is a long-term tangible piece of property or equipment that a firm owns and uses in its operations to generate income. Fixed assets are not expected to be consumed or converted into cash within a year. Fixed assets most commonly appear on the balance sheet as property, plant and equipment (PP&E). They are also referred to as capital assets.
I also pointed out that there are many other types of assets, and foreshadowed further discussions about these. This article explores this topic further.
When I started looking further into the nature of assets, I found that different sources tended to present somewhat different listings of asset types, and differing perspectives of their relevance in various contexts.
In this article, I will first outline the results of this exploration, which includes a representation of types of assets in a business context, and of interfaces between them.
I then explore an idea first put to me by Giammalvo which links project deliverables directly with assets, and discuss this in the context of three broad groupings of deliverables from organisational strategic initiatives – and thence projects – from Stretton 2021k.
This is following by a brief consideration of the business organisation as a long-term fixed asset in its own right, which adds further asset interfaces to those already represented. I conclude with diagrams illustrating the cumulated assets and their interconnections, and their connections with the three broad groups of organisational strategic initiatives/projects.
SOME DESCRIPTORS AND PERSPECTIVES OF TYPES/NATURES OF ASSETS
Asset/assets has/have a wide variety of usages/ meanings
The variety of usages and meanings of asset/assets are illustrated in the following example from a Norton search.
Asset – Meaning in the Cambridge English Dictionary
- A useful quality, skill or person
- An asset is also any positive feature that gives you an advantage
- Something valuable belonging to a person or organisation that can be used for the payment of debts
- [Accounting, finance] Something that is owned by a person, company, or organisation, such as money, property or land.
The first two bullet points are quite generalised usages. The third relates more specifically to the payment of debts, which is more of a specialised usage. The fourth relates to accounting/finance contexts, which are widely used, and particularly relevant to the business domain. Several specific types of assets are traditionally identified in the accounting/ finance and business contexts, to which we now turn.
Some definitions/understandings of types of business-related assets
Investopedia identifies four types of business-related assets.
Assets can be broadly categorised into short-term (or current) assets, fixed assets, financial investments, and intangible assets.
Current assets are short-term economic resources that are expected to be converted into cash in one year.
Fixed assets are long-term resources, such as plant, equipment and buildings.
Financial assets represent investments in the assets and securities of other institutions.
Intangible assets are resources that have no physical presence.
The Institute of Asset Management has published a two-part Publicly Available Specification (PAS 55) on Asset Management (IAM 2008a,b). Although PAS 55 is primarily concerned with physical assets, it identifies five broad categories of asset types, which it discusses in IAM 2008a:vi, in part as follows
0.2 Types of assets
The physical assets (see 3.1) represent only one of the five broad categories of asset types that have to be managed holistically in order to achieve the organization’s strategic plan. The other assets are human assets, information assets, financial assets and intangible assets (reputation, morale, intellectual property, goodwill, etc). …..
The management of physical assets and asset systems is inextricably linked to the other categories of assets; ….
A listing of relevant types of assets
It is evident that the IAM’s Physical assets would include both Fixed and Current assets, even though its primary concern is with the former. If we then amalgamate the asset types from the above two sources, we have the following listing
- Fixed assets } Physical
- Current assets } assets
- Financial assets
- Intangible assets
- Information assets
- Human assets
More…
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How to cite this paper: Stretton, A. (2021). An exploration of assets and projects: Types of assets, and project deliverables as assets, in an organisational context, PM World Journal, Vol. X, Issue X, October. Available online at https://pmworldlibrary.net/wp-content/uploads/2021/09/pmwj110-Oct2021-Stretton-assets-and-project-deliverables-in-organisational-context.pdf
About the Author
Alan Stretton, PhD
Faculty Corps, University of Management
and Technology, Arlington, VA (USA)
Life Fellow, AIPM (Australia)
Alan Stretton is one of the pioneers of modern project management. He is currently a member of the Faculty Corps for the University of Management & Technology (UMT), USA. In 2006 he retired from a position as Adjunct Professor of Project Management in the Faculty of Design, Architecture and Building at the University of Technology, Sydney (UTS), Australia, which he joined in 1988 to develop and deliver a Master of Project Management program. Prior to joining UTS, Mr. Stretton worked in the building and construction industries in Australia, New Zealand and the USA for some 38 years, which included the project management of construction, R&D, introduction of information and control systems, internal management education programs and organizational change projects. He has degrees in Civil Engineering (BE, Tasmania) and Mathematics (MA, Oxford), and an honorary PhD in strategy, programme and project management (ESC, Lille, France). Alan was Chairman of the Standards (PMBOK) Committee of the Project Management Institute (PMI®) from late 1989 to early 1992. He held a similar position with the Australian Institute of Project Management (AIPM), and was elected a Life Fellow of AIPM in 1996. He was a member of the Core Working Group in the development of the Australian National Competency Standards for Project Management. He has published over 230 professional articles and papers. Alan can be contacted at alanailene@bigpond.com.au.
To see more works by Alan Stretton, visit his author showcase in the PM World Library at http://pmworldlibrary.net/authors/alan-stretton/.
