Are you managing your equipment and inventory manually, with spreadsheets that take hours to maintain? Believe it or not, there are still businesses out there doing exactly that. An obsolete asset management system can waste time and money for you and your organization. You need a good system in place in today’s fast-paced corporate world. Discover how to set up an asset management system by establishing goals, developing a plan, and employing current technologies.
What is an Asset Management?
Asset management is planning and supervising the purchase, operation, maintenance, renewal, and disposal of organizational assets. This technique optimizes asset delivery potential while minimizing costs and hazards. Proper maintenance and the right deployment of systems, people, and processes ensure a positive enhancement of capital over the asset lifecycle.
What is an Asset Lifecycle?
The number of stages an organization’s asset goes through during its ownership lifecycle is referred to as the asset lifecycle. It is the time when a company may effectively and efficiently use an asset to achieve its business objectives. An asset lifetime typically encompasses all stages of an asset’s life, from acquisition to maintenance and disposal.
Types of Asset Management
Asset management can be broadly categorized into three categories: physical, financial, and contractual, however, the definition may vary from organization to organization.
- Physical Asset Management: Fixed asset management, inventory management, infrastructure management, and public asset management are all examples of physical asset management.
- Financial Asset Management: Financial asset management refers to the process of managing procurement, formulating an investment strategy, controlling budget and costs, and handling cash, bonds, and stocks.
- Contractual Asset Management: Contractual compliance optimizes procedures such as IT asset management, digital asset management, contractual maintenance, and intangible asset management.
What is an Asset Management System?
An asset management system monitors and manages assets. It consists of methods, strategies, and, sometimes, software that aid in attaining asset management goals and objectives.
Asset management enables organizations to maximize their return on investment and reduce losses. Assets are valuable goods from which a corporation or organization benefits. With asset management, stakeholders may monitor the entire performance and condition of their assets and ensure that they are used efficiently throughout their useful life.
What is the Purpose of an Asset Management System?
An asset management system’s objectives differ based on what industry or sort of business a firm is in. Regardless of industry, these can be attained via thoughtful and strategic planning. The following are some of the most common aims achieved by employing an asset management system:
#1. Detect and remove asset waste
Asset management reduces losses by quickly identifying and eliminating wasted assets throughout the supply chain. “Wasting assets” are items that lose value and perform poorly over time due to their short lifespan. Computer equipment, machinery, automobiles, or any asset critical to business operations are examples of wasting assets.
#2. Increase asset use.
Asset management allows businesses to determine the state or condition of assets. This useful insight enables them to make business decisions that increase asset utilization and allocation, hence extending asset lifespan and speeding up business operations.
#3. Maximize your return on investment
When the two objectives listed above are met, the overall return on investment is maximized. Businesses or organizations can save money on asset repairs and repurchasing prices.
Additional aims that can be achieved with asset management fall under the following categories:
- Political Objectives – For example, improving the organization’s reputation in the community by adhering to rules and regulations.
- Social Objectives – e.g. safeguard persons and properties
- Technical Objectives – such as providing personnel with the proper technology
- Environmental Objectives – such as reducing energy use
The Importance of Asset Management
Consider having to manually control your asset management system for each laptop or computer in your firm. Or even every item in your warehouse. Assets will fall between the gaps. This is why a sound system is crucial for your company.
A decent asset management system software package can assist you in accomplishing this more efficiently. It can help you by:
- Allowing you to track and monitor every asset in your firm in one single area
- Allowing you to manage your assets from any location, especially if the package contains a mobile component.
- Assessing and managing any asset risks so that they can be mitigated as soon as possible
- Supplying information on an asset’s lifecycle
- Assisting in the identification of ghost assets that can be removed from the system
- Arranging maintenance plans for each asset to avoid service disruptions
- Providing you with accurate, in-depth reports and audits that do not take hours to create.
Why Employ an Asset Management System?
Asset management software is intended to assist your firm in reducing its expenditures on acquiring, maintaining, and operating assets. You want to run at peak performance, which means you must minimize expenses, keep production quality at an acceptable level or above, and optimize returns.
Your asset management system should be able to track your assets using GPS and RFID. Don’t forget to follow the vehicles your firm owns and uses on a regular basis, as well as the equipment inside. In addition to your workplace furniture, IT equipment, and software are also required. You will not be able to control every part of your assets if your software cannot track all of these items.
Why do you want to keep track of all of these things? It ensures that assets are used correctly and efficiently, and it allows managers to track the total performance of each asset. It allows you to prevent any additional charges that may be needless because of unscheduled downtime.
How To Create a Strategic Asset Management Plan
A strategic asset management plan defines the specific tasks, resources, and timing required to accomplish the asset management objectives of the firm. The following steps will assist you in developing your own strategic asset management plan for your company:
#1. Gather information
In this step, all assets possessed by the organization should be accounted for. This requires obtaining information such as total count, location, value, date acquired, and estimated life cycle. It is also critical to determine the life-cycle expenses of each asset. This data will be useful in identifying whether an asset needs care or elimination.
#2. Establish service levels
The services that assets provide are judged by their safety, reliability, quality, availability/accessibility, responsiveness, cost, sustainability, and environmental effects by determining service levels. This lets businesses evaluate the worth of each asset and the operating, maintenance, and renewal operations that will keep it in good condition.
#3. Describe the asset management and operating procedures.
Knowing an asset’s lifecycle and lifecycle management is a vital aspect for an asset management plan. This step highlights the planned actions that will allow assets to provide the specified levels of service in a sustainable manner. The following subsections should be determined in the strategic asset management plan:
- Background Information – offers asset information such as age, size, capacity, performance, present condition, and value.
- Risk Management Plan – Identifies the risks that might affect the supply of service, goals or objectives impacted by the risk, risk identification process, risk assessment, and risk mitigation methods.
- Operational Plan – Specifies established operating processes to meet the required service levels.
- Equipment Maintenance Plan – Outlines the stated maintenance strategies and methodologies, as well as projected maintenance expenses.
- Disposal Plan – Describes the steps involved in the disposal of retired assets. It also includes predictions of cash flow from asset disposal revenue and expenses.
#4. Create a financial strategy.
This stage covers all of the financial requirements for the actions stated in the preceding sections. A financial strategy should identify financing sources and incorporate historical and future budgeted capital and operating costs.
#5. Have an improvement plan.
An improvement plan should include actions for improvement, responsibilities, resources, and timelines. Having an improvement plan can assist the company monitor and overseeing asset management activities to ensure that sound asset management practices are applied and that the entire process stays on track.
Read Also: Quality Management Systems (QMS): Certifications, & Software
Top Asset Management System Software
Now that you understand the advantages of installing an asset management solution, it’s time to choose the best one. There is no such thing as the ideal asset management system software, thus you must select the best asset management tool for your specific requirements.
Listed below are five common asset management system software in the market which is an excellent place to start your search.
#1. ServiceNow
ServiceNow, which is designed exclusively for organizations, provides a variety of asset management services such as inventory management, financial and contractual information management, resource tracking, and more. With a complete asset management tool like ServiceNow, organizations won’t have to move between specialty software solutions for each specific HR function.
- Pros: Simple to use, consolidated asset database, and configurable reports
- Cons: At first, matching all asset entitlements and contracts is difficult and time-consuming.
#2. Kissflow
This isn’t a strictly administration-automation technology, but a finance cloud that you can use to manage fundamental operation chores like asset management, facilities management, and more. Kissflow is an easy-to-use financial and operations cloud for businesses of all sizes.
- Pros: Simple, adaptable, and consistent user experience across devices.
- Cons: Simplistic process layouts, a lack of pre-defined templates, and dashboards
#3. SAP ERP Suite
SAP initially did not place a high priority on corporate asset management, and as a result, the system had significant feature holes. Yet, it has now matured into a comprehensive suite of business asset management technologies applicable to various industries. SAP’s main advantage is the ease of handling everything from materials to assets and costing in one location.
- Pros: Extensive functionality, good service competence, and an active user community.
- Cons: The maintenance schedule tool is neither flexible nor conducive to industry norms.
#4. IBM Maximo
Maximo is an end-to-end asset management solution that includes a detailed maintenance module as well as other tools for procurement and inventory management. The product’s integration mechanism is effective, and it encourages a well-connected asset management platform.
- Pros: Product functioning, product plan, and future vision
- Cons: Clumsy user interface, flaws in the spatial add-in, and troubles with mobile apps
#5. Oracle E-Business Suite
Oracle E-Business Suite provides an all-in-one asset management solution. The application provides graphically rich reporting tools that stakeholders can use to produce a customized analysis report. With REST API or SOAP connectors, businesses can interact with a wide range of apps.
- Pros: User experience that is welcoming, versatile, and consistent across devices
- Cons: The cost of upkeep is prohibitively high.
What Is the Cost of an Asset Management System Software?
The cost of asset management system software varies according to the capabilities provided and the pricing strategy. Some AMS providers base their pricing on the number of users, while others base it on the number of assets or a combination of the two. Therefore it depends on what you want from an AMS system.
Summary
Effective asset management is critical to the success of any company, particularly because infrastructure assets with lengthy life lifetimes and significant capital investment will offer a basis for economic activity. The more complicated the business, the more important it is to have a sound asset management mechanism in place.
While manual asset management procedures can get the job done, staff will have to manually wrinkle and iron out a lot of details to guarantee their firm makes the best use of the available assets. Businesses may easily manage assets and implement their asset management goals by deploying an asset management technology.
If you’re looking for the best asset management software, choose a solution that not only helps you manage assets but also extends their life, ensuring they function smoothly and affordably.
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