The world enterprise asset management systems (EAM) market for process industries has experienced continued growth, with high plant maintenance costs fueling spending on EAM systems. According to a new report, "World Enterprise Asset Management Systems Markets" from Frost & Sullivan, the market earned revenues of $1.19 billion in 2006, and should reach $2.24 billion in 2013.

According to the report, for EAM systems vendors to sustain this growth they will have to provide innovative and cost-effective solutions to multinational as well as small and medium businesses (SMBs), says Frost & Sullivan. The ability to increase presence in the Asia Pacific and Latin American regions will also open new market opportunities.

The increased penetration of ERP systems has also driven growth in the EAM space. "In order to leverage the complete benefits of an efficient [ERP] system, the assets and the maintenance operations of the plant floor need to be integrated into the ERP system," says Arun Kumar J., program manager, Frost & Sullivan Industrial Automation and Process Controls. "A total integrated ERP system with EAM can have significant benefits in terms of better inventory control and purchase operations, better streamlining of maintenance operations across locations, and total control over the system from plant floor to the boardroom."

Other drivers include an aging workforce, and the need for collaborative manufacturing management systems, Kumar says.

While the global market for EAM will expand, Kumar says that the U.S. market will likely decline through 2013, due to decreasing investments. Outsourcing from North America, however, is driving deployment in Asia, while standards and compliance issues are forcing companies in Western Europe to invest in EAM.

Regulatory compliance has also made EAM a more attractive investment for companies in the U.S. that need to implement risk management, compliance tracking, documentation, and maintenance control initiatives.

Aberdeen Group's recent report, "Enterprise Asset Management: Maximizing Return on Assets and Emerging Trends," further defines the pressures driving manufacturers to focus on asset management. Sixty-five percent of respondents to Aberdeen's survey cited maximizing return on assets as a top pressure, followed by the risks from failure of critical assets (61%), complexity in manufacturing assets and reducing energy consumption (19% for both).

"The science of risk has garnered much attention among manufacturers, and is critical in terms of asset management," say the report's authors, Matthew Littlefield and Mehul Shah. "From the asset management perspective, this approach helps manufacturers be proactive in nature and move away from the traditional break-fix approach by gaining real-time visibility into equipment failures before they actually occur."

By optimally managing manufacturing assets, companies can reduce manufacturing costs by minimizing the potential downtime of critical equipment and process plants.

"The ability of EAM systems to reduce plant downtime and the manufacturing costs remains the primary driver for the world EAM systems markets," the report says. "The growing need to adhere to regulatory requirements, implementation of best practices, and the increased penetration of enterprise wide IT systems will likely propel the growth of this market."

According to Aberdeen, best-in-class companies are 65% more likely than laggards to invest in EAM solutions, and experience 22% higher plant throughput and 31% lower asset downtime than laggards.

"Manufacturers have invested heavily on assets and are continually faced with the pressure to maximize return an asset and reduce risk due to failure of critical assets," says Shah, an analyst with Aberdeen's Global Manufacturing Practice. "The research found that best-in-class manufacturers are more likely to have adopted [EAM] solutions and are also more likely to connect EAM with both plant floor systems as well as ERP by creating real time interoperability across these systems. Aberdeen also found best-in-class manufacturers integrating energy management initiatives into their overall asset management strategies to reduce energy consumption costs."

EAM solution vendors face a challenge in providing a scalable product portfolio that is adaptable for both large multinationals as well as small and mid-sized companies. Challenges also exist in the implementation of best practices and safety, security, and compliance regulations, as well as the complex maintenance, repair, and overhaul (MRO) strategies on a quick and scalable basis.

"Any EAM solution vendor that provides a modular, scalable, off-the-shelf solution would have tremendous advantage over other participants," the Frost & Sullivan report states. "However, this is quite a challenge considering the fact that most of the existing systems require a considerable amount of hardware and software configuration changes to cater to a greenfield and brownfield installation."

Kumar says that the market currently favors large enterprise vendors with integrated solutions and close ties with process automation vendors.