Why is asset management so important?

Why is asset management so important?

Asset management is important because it helps a company monitor and manage their assets using a systemised approach. Managed effectively, the benefits include improvements to productivity and efficiency which places a business in a better position to increase their return on investment.

What is asset management?

So, what is asset management? In the most simplest of terms – if you consider that fleet management incorporates all aspects that correlate to managing a fleet, asset management is similar, but manages all assets across the business – and that includes those within your fleet too.

Buildings, plant machinery and equipment tools – in fact, anything that is tangible or intangible, can be effectively managed from one central point. In addition to mobility management, asset management is seen as the next step in the evolution of fleet management. The good news – the software technology is already in place!

Why asset management?

Having such a system in place allows managers to track the overall performance of their assets. This helps to ensure that they’re being utilised efficiently, allowing for performance to be reviewed and helping to prevent any unnecessary, additional costs being incurred due to incidents such as unscheduled downtime.

What is an asset manager?

Quite simply, an asset manager monitors and maintains things of value within a business. By developing an effective asset management plan, they are able to develop, operate, maintain, upgrade and dispose of assets cost effectively. To do this, they assist in all aspects of the administrative, financial, capital and operations of the assets within their portfolio. An asset manager therefore needs a good grasp of both the strategic and operational processes within a company.

Alternatively, asset management companies are external specialists brought in to manage the assets on behalf of a business. They are a team of professionals that will look at the assets, cash flow and finances available to a company. From this, they can then determine how a company should reinvest to maximise the profitability of the business.

How does asset management work?

Asset management encompasses a holistic view of the entire lifecycle of an asset. So, in terms of a piece of machinery, this is its’ lifecycle from procurement and implementation through to renewal and disposal. Although asset management can be implemented through spreadsheets, the most effective systems are those that use the relevant software.

Such software can collect and analyse data efficiently so that decisions about the management of assets can be made. The consequences of each activity for an asset can be monitored so that a review of the cost benefit analysis can be made.

What are the benefits of asset management?

There are lots! In order for an asset management plan to be effective, it needs to be supported by an asset management system with the capabilities to monitor and maintain things of value – both tangible and intangible. They are similar to fleet management systems, but can be implemented on a much wider business scale.

By working across other business departments, locations and facilities; assets such as vehicles, tools, equipment, processes and even people can be reviewed and managed efficiently from one central ‘hub’. Such collaborative working helps a business to reduce both the overall capital expenditure and operating expenditure related to your assets.

A correct and implemented asset management software can:

  •  Keep a track of all assets
  •  Manage assets from different locations
  •  Provide an opportunity to plan against financial, operational and legal risk
  •  Define the service levels
  •  Create a more efficient operation with the ability to track performance
  •  Improve time management
  •  Measure and monitor life-cycle costs
  •  Promote the economic stability and growth of your company
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