Asset Management Is just a Tool Every Business Can Use to Save Money and Improve Productivity
For some businesses, the efficient tracking of their installed base or in-service equipment, and the management of their spare parts inventories are key factors in determining the prospects for internal productivity and customer support profitability. However, many organizations do not even start using a comprehensive asset tracking and management process to ensure the option of quality data that may be used to generate the business intelligence that could ultimately save them money and improve efficiency. This really is unfortunate, because the tools are plentiful – it is just a matter of making it a priority.
What’s Asset Management?
There are many definitions of “asset management”, although most deal primarily with financial considerations. Some are based on evolving maintenance management systems; some on the management of factory floor equipment configurations; and some for the purposes of monitoring network equipment or even railway car and container locations. However, regardless of what situation or application your business deals with, the core definition remains constant; asset management is “an organized process for identifying, cataloging, monitoring, maintaining, operating, upgrading and replacing the physical assets of the business on a cost-effective basis “.
To be truly effective, the asset management process must be built upon a basis of widely accepted accounting principles, and supported by the appropriate mix of sound business practices and financial acumen. It can provide management with a powerful tool that may be used to derive better short- and long-term planning decisions. As such, it is something that every business must look into adopting – and embracing.
After years of studying and supporting the Information Technology (IT) needs and requirements of clients in all major fields of business, we choose to define asset management in a more dynamic way, encompassing each of the following four key components:
An enabler to generate and maintain critical management data for use internally by the business, along with using its respective customers and suppliers (such as installed base or maintenance entitlement data).
A comprehensive process to obtain, ktam validate and assimilate data into corporate information systems.
A flexible system enabling either the manual acquisition and/or electronic capture and reconciliation of data.
A program with accurate and intelligent reporting of critical business and operational information.
Asset management isn’t merely the identification and inventorying of IT and related equipment; it is the procedure of making the assets you possess work most productively – and profitably – for the business. Further, it is not really a system you can purchase; but is, instead, a company discipline enabled by people, process, data and technology.
What’re the Signs, Symptoms and Aftereffects of Poor Asset Management?
Poor asset management results in poor data quality – and poor data quality can negatively affect the business over time. In reality, experience shows that there are several common causes that could result in poor asset management, including not enough business controls for managing and/or updating asset data; not enough ownership for asset data quality; and an out-of-balance investment in people, process, data and technology. Additionally, some businesses might not consider asset management to become a critical function, emphasizing audits only; while others might not consider asset data to be a significant element of the business’s intellectual property.
The principal apparent symptoms of poor asset management will also be fairly ubiquitous, and may include anything from numerous compliance and security issues, to uncontrollable capital and/or expense budgets, excessive network downtime and poor performance, under- or over-utilized assets, incompatible software applications, increasing operational costs and headcount, and non-matching asset data derived from different organizations and/or business systems.
Moreover, poor ongoing asset management practices can impact a company by degrading customer support delivery, polluting the prevailing installed base of data and distracting sales resources with customer data issues Like, Service Delivery may be impaired by inaccurate depot sparing creating customer entitlement issues, increasing escalations to upper management and lowering customer satisfaction. An uncertain installed base lengthens contract renewal cycle-time, limits revenue opportunities and inhibits technology refresh planning. Caused by poor asset management can ultimately be devastating to a company, often resulting in more than one of these negative impacts:
Increased Asset Total Cost of Ownership (TCO)
Decreased workforce productivity
Increased non-compliance issues (i.e., SOx)
Decreased Customer Satisfaction
Lower Return-on-Investment (ROI) on capital investments
Decreased network/business performance
Increased number of internal and external audits
The causes of poor asset management could be many; the observable symptoms pervasive; and the outcomes devastating. However, what’s promising is that there are specific solutions available that could help any organization avoid these pitfalls.