What is an asset?
In the context of asset management, an asset means any physical item of economic value owned by an individual or corporation that they use in the operation of a business, including:
- Machinery
- Vehicles
- Equipment
- Buildings
Assets are critical to the core functionality and productivity of an organization, and their effective management ensures their optimal use, extends their life spans, and contributes to the overall efficiency and profitability of the organization.
What is asset management?
Asset management is the combination of policies, procedures, and best practices an organization implements to gain the most value from their assets and equipment, reducing costs and improving planning. It is a complex, ongoing process, requiring cross-team and interdepartmental coordination.
The larger steps include:
- Acquisition and installation
- Adopting maintenance strategies and implementing task and inspection schedules
- Managing associated parts and materials inventory
- Determining repair-or-replace criteria, decommissioning and replacing
Organizations can benchmark their programs with a range of maintenance metrics and key performance indicators (KPIs) like utilization rates, uptime, and total cost of ownership (TCO).
In an episode of Eptura’s Asset Champion podcast, host Mike Petrusky spoke with Lindahl Reed, Inc.’s Senior Director of Asset Management, Jack Dempsey. The episode was primarily about leveraging AI in asset management strategies, but Dempsey advocated that while “asset management is about outcomes, in terms of the practice it’s about knowledge and communications.”
This knowledge can be incorporated into thought processes surrounding asset management strategies to drive better outcomes — a core takeaway when considering the existing state of, and conversations around, your asset management strategy.
“Asset management is about outcomes but in terms of the practice it’s really about knowledge and communications.”
— Jack Dempsey, Senior Director of Asset Management at Lindahl Reed, Inc.
Why is asset management important?
Putting an effective asset management program in place enables organizations to systematically monitor and maintain assets, helping improve reliability and cut costs across the life cycle. Properly managed assets and equipment run longer, more often, at lower costs.
With a modern asset management program, facility and maintenance professionals can deliver a wide range of benefits, including:
- Gain performance insights: Track asset locations, how employees use them, how they’re performing, and when technicians perform maintenance and repairs. With complete visibility, companies can identify unnecessary costs and make data-backed repair-or-replace decisions
- Reduce maintenance and repairs: Set up and schedule a comprehensive preventive maintenance program to stay ahead of issues. Because inventory control is a key part of overall asset management, the company carries less but always has the parts it needs at the right time
- Cut costs across the life cycle: Monitor the costs of assets across their life cycles to see exactly where they are in the life cycle. Replace business assets at the best time to manage costs and reduce risk. Leverage lessons learned in future procurements
To move these initiatives forward, organizations need sophisticated technology. Asset management software serves as the backbone of modern asset management strategies. By automating data collection, providing real-time access, and enabling data-driven decision-making, this software empowers organizations to achieve their asset management goals efficiently and effectively.
What is asset management software?
Modern asset management software is a cloud-based, centralized system that empowers organizations to automatically capture asset data, make it available to management and maintenance teams from anywhere and at any time, and then leverage the data through reports for actionable business intelligence. And by removing the human error that comes with manual entry and breaking down the data silos that can exist between teams.
What are the key features for asset management software?
At the heart of an asset management solution is the asset registry, a comprehensive list of all the assets and their properties, including specifications, purchase information, and operational status. For large enterprises, having a centralized asset registry ensures that all asset-related data is easily accessible and up to date, supporting oversight and management, enabling leaders and facility managers to quickly retrieve and analyze asset information, which is crucial for strategic planning and operational efficiency.
But it’s not simply a long list of assets. The asset hierarchy reflects the relationships between “parent” and “child” assets, critical pieces of information. Child assets are maintainable, repairable, or replaceable parts or components inside larger assets. So, the child asset must be functioning for the parent to run properly. For example, a flatbed trailer that a particular semi-truck always hauls, or a snowblade assigned to a particular truck.
Building off that core list, asset management software can deliver many interconnected, complementary features, functions, and modules, including:
- Asset tracking: Monitor the location, status, and usage of assets in real-time using barcodes, RFID tags, or GPS tracking, reducing the chances of theft while ensuring employees can find assets quickly
- Inventory management: Manage stock levels, orders, sales, and deliveries to avoid overstocking or stockouts by providing accurate inventory data
- Maintenance scheduling: Set up and schedule regular maintenance and inspections to ensure that assets are kept in optimal condition, extending the life of assets and reducing downtime
- Depreciation calculation: Automate the calculation of depreciation for financial reporting and compliance, which is crucial for accurate financial statements and tax calculations
- Reporting and analytics: Provide comprehensive reporting tools that generate insights into asset utilization, maintenance costs, and performance metrics for informed decisions about asset management strategies
- Life cycle management: Manage the entire life cycle of an asset from procurement to disposal, including tracking performance, maintenance history, and eventual replacement or disposal
- Document management: Store, manage, and quickly retrieve and share asset-associated documents like warranties, manuals, and service contracts to ensure compliance with best practices, SOPS, and contractual obligations
- Compliance management: Ensures that all assets are managed and maintained in accordance with relevant laws, regulations, and standards. This is crucial for avoiding legal penalties and ensuring safety
These features, along with others, collectively help organizations optimize their asset utilization, improve maintenance practices, and ultimately enhance overall operational efficiency
How does enterprise asset management (EAM) improve capital planning?
Reliable asset management is critical for effective capital planning. Without up-to-date numbers on where the organization is today, knowing how best to prepare for tomorrow becomes impossible.
Improving maintenance and cost transparency
Consolidating asset data into a single, centralized platform makes capital planning decisions easier. With robust data analytics, the company can see total maintenance costs and understand how every building and asset contributed to them. From there, they can identify trends and plan new investments accordingly.
Facility managers and machine operators can also perform mobile inspections to enhance your understanding of your assets. They can use a standard inspection checklist and select pre-populated failure codes to give your company a more accurate assessment of the most common maintenance issues.
When you can pinpoint a single factor contributing to a significant portion of your maintenance costs, you can make more informed decisions about where to invest in improvements.
Reducing maintenance backlogs
If your facilities maintenance team has a growing backlog of deferred maintenance, you’re not alone. The average school building in the United States is over 40 years old and school buildings collectively report an estimated $500 billion in deferred repairs.
A proactive enterprise asset management strategy streamlines preventative maintenance to reduce backlogs. With enterprise asset management software, facilities managers and maintenance technicians can schedule activities in advance according to the manufacturer’s guidelines and receive automated reminders when it’s time to make repairs.
Improving efficiency and productivity
When your team spends hours each week searching for information, they have less time to spend on more strategic priorities like developing a capital improvement plan and budgeting for new investments.
EAM software makes your entire team more productive by allowing everyone to see what activities are scheduled, how much inventory you have on hand, and where to find your most important assets.
Your team can upload photos of new assets and important documents, such as lease and warranty information, directly into the system so they’re easy to reference later. They can retrieve any information about an asset simply by scanning a barcode on their mobile device.
Refining forecasting accuracy
By consolidating data across departments – including asset availability, maintenance needs, supply chain and inventory, purchasing, and other financial functions – enterprise asset management software helps you monitor key performance indicators and forecast future needs.
It’s easier to decide how many parts you need to have on hand to keep your buildings and assets running smoothly, when to buy or lease equipment, and whether it is more cost-effective to repair or replace it.
Asset management software success story
Gas Field Specialists, Inc. (GFS), provides a wide range of services and resources to the oil and gas industry, including well site construction, equipment rentals, transportation services, well maintenance, roustabout services, reclamation, and pipeline fabrication. They partnered with Eptura to transition their maintenance and inspections strategy from an unwieldy process to a streamlined operation that met rigorous regulatory requirements.
The challenge
GFS faced the challenge of maintaining all vehicles and equipment in top condition while complying with government regulations and serving clients. They had to maintain detailed records of safety inspections and corrective actions for every asset, ensure all certifications and inspections are up-to-date, and track preventive maintenance and inventory data.
The solution
To better organize maintenance schedules, track task completion, and analyze their expanding operations, GFS partnered with Eptura to achieve the following objectives.
- Improve scheduling: To manage the maintenance of a diverse array of assets, GFS utilizes Eptura Asset to schedule and track services like inspections and certifications. This system allows for dynamic scheduling, where maintenance tasks are organized at various intervals and prioritized easily through a drag-and-drop interface. Automated alerts ensure timely preventive maintenance. Additionally, Eptura Asset has improved GFS’s Inspection Selection System rating, reducing inspections and regulatory penalties by focusing on specific maintenance improvements
- Detailed record-keeping: GFS mitigates liability concerns by ensuring all equipment and services are safe and reliable, maintaining detailed records on a centralized platform. Previously, asset managers struggled with paper records, but now, Eptura provides a searchable database and easy report generation, enhancing efficiency and reliability in client communications
- Calibration: GFS addresses quality control in the oil and gas industry by using Eptura Asset to manage the calibration of 140 types of measuring equipment and maintain necessary welding certifications. They created a dedicated quality control entity within Eptura, allowing for easy monitoring of equipment status and certification renewals, improving efficiency and spreading tasks throughout the year. Additionally, Eptura’s audit trails ensure compliance with stringent recordkeeping regulations
- Operational insight: GFS enhanced its operational efficiency in the competitive oil and gas industry by using Eptura Asset for inventory audits of over 1,700 parts via barcode scanning, revealing undervaluations up to 70%. Additionally, Eptura’s mobile solutions allow for real-time tracking of truck usage and worker hours, facilitating data collection and transmission from any location
“We have 6,700 schedules in Eptura Asset, and it just purrs. It runs really, really well. It’s the lifeforce of our entire maintenance company.” — Tim Haley, GFS Project Analyst
Read the full story
Asset management trends
Leaders in asset management have always embraced new technologies to streamline and strengthen their workflows. While some still rely on paper or individual spreadsheets on local computers, modern asset management leverages new developments in cloud computing, the Internet of Things (IoT), and machine learning to improve processes. There’s also been a strong push toward sustainability and cutting carbon emissions.
Cloud-based solutions
Cloud platforms offer scalability, flexibility, and accessibility over traditional on-premises solutions. They allow facility managers and enterprise leaders to access asset data from anywhere, at any time, using any Internet-connected device. The increased mobility enhances collaboration among teams and supports a more agile response to asset-related issues. Also, cloud solutions reduce the IT overhead associated with maintaining and updating software, as the service providers handle these tasks.
Internet of Things (IoT)
IoT is revolutionizing asset management by enabling enhanced connectivity and automation. Devices embedded with sensors and connectivity tools can now communicate and exchange data, allowing for real-time monitoring and management of assets across multiple locations. IoT integration in asset management helps organizations reduce downtime, extend asset life, and optimize operational efficiency, ultimately leading to significant cost savings and improved asset performance.
Predictive analytics
Predictive analytics is becoming increasingly integral to asset management, allowing enterprises to forecast future asset behaviors and needs based on historical data. By leveraging machine learning algorithms and statistical models, predictive analytics can identify potential failures before they occur, minimizing downtime and maintenance costs. The proactive approach not only extends the life cycle but also optimizes maintenance and repairs schedules, making operations more efficient by getting the most work done when it causes the smallest number of disruptions.
Sustainability
As global emphasis on sustainability grows, enterprises are increasingly adopting asset management practices that promote environmental responsibility. This involves optimizing asset use to reduce energy consumption, managing waste more effectively, and ensuring that assets are as environmentally friendly as possible. Asset management software can help track and analyze energy usage and sustainability metrics, making it easier for companies to achieve their green objectives and comply with regulatory requirements.
Asset management best practices
Develop an asset strategy
Gathering information on your assets only wastes time and money if you have no plan for how to implement the information. Just as it’s imperative to have buy-in from the right team members when developing a preventative maintenance plan, it’s equally important to create a plan and involve your team when implementing enterprise asset management software.
Loop in your facilities maintenance managers, operators, technicians, and purchasing managers who will benefit most from the solution. You’ll also want feedback from executives, including your CFO and corporate real estate manager, to determine what data they need for capital planning purposes. This cross-department collaboration will ensure the long-term success of your enterprise asset management strategy.
Find asset management software that supports your needs
Consider what aspects of asset management you want to simplify, automate, or improve. Are you primarily focused on asset tracking and preventive maintenance scheduling, or do you need more in-depth inspection capabilities and advanced reporting to conduct a cost analysis?
What other systems do you need to integrate with? Do you use a GPS system to track the mileage on your vehicles? Do you use space management software to keep track of all your building data?
Will the software you choose work well with your existing accounting and lease management solutions?
You’ll also need to consider the pricing model and how easily you can scale the solution as your organization grows.
Invest in employee training
The software you choose should be easy for anyone to use, but the employees who use it most often need to be fully familiar with its features and functions. To maximize your investment in EAM software, employees need to feel confident, competent, and engaged in the new system. If they believe it will make their jobs easier, they will be more likely to use it in their daily activities.
Find out how you can get more from your assets with Eptura Asset.
