How would you feel if you stumbled across the item you literally just spent $200 replacing because you couldn’t find it? Or what if your car died in the middle of the highway because the Check Engine light was burned out?
Talk about frustrating.
But imagine how you’d react if you spent $2,000 to replace the 3D printer you couldn’t locate, only to discover an employee had moved it to another floor without informing anyone. Or say your industrial HVAC system had a critical failure because, due to improper documentation, you were unaware it was a year overdue for scheduled maintenance.
That’s pull-your-hair-out, excuse-yourself-to-go-scream-in-your-car frustrating.
The best way to avoid finding yourself in a similar situation is to invest in an asset tracking software. Here are seven things you’ll encounter if you don’t use asset tracking.
1. It’s nearly impossible to have an accurate, comprehensive view of the asset portfolio.
Using a system of hard copies, multiple manually updated spreadsheets or several siloed databases means the facilities management (FM) team doesn’t have real-time access to the data they need. They can’t be 100% confident about an asset’s location unless they are actually looking directly at the asset, and if an asset goes missing, they might not know for days, weeks or months.
The FM team also has limited visibility into the true utilization of any asset, which means the organization could be wasting funds on storing and maintaining equipment it doesn’t actually need. Conversely, an asset could be in high demand and have insufficient availability, which can disrupt operations and be frustrating for employees.
2. Facilities leaders will have to hunt for data in multiple places.
While one file may contain the asset’s maintenance schedule, the list of necessary software updates as well as the required calibrations could be in two or three completely different locations—possibly in the form of a printed document that isn’t accessible electronically.
An asset tracking solution compiles all of this information into one database that the facilities leader can quickly view and manage. Within the platform, the facilities leader can search by serial number, owner, location or type and instantly see all of the data for that asset.
3. The FM team must complete all inventory counts and reporting manually.
Manual inventory counts and reporting are not only inefficient, but they also increase the risk of human error. And one small error can have a big impact on an enterprise’s profitability. Plus, multiple copies of the same report could exist, which can lead to conflicting information. Both of these situations can result in a facilities leader using incorrect data to make important decisions.
Completing inventory counts and generating reports without asset tracking software makes it difficult for the FM team to identify important trends. The ability to see how and when assets are used as well as who is using them gives facilities leaders the opportunity to improve the productivity of the workforce and the effectiveness of the workplace.
4. Employees may keep assets longer than necessary.
When an employee checks out an asset, they may overestimate the length of time they will need it. If the team member delays returning the asset when he or she no longer requires it, then that asset not only is taking up space but it is also unavailable to anyone else who may actually need it. As a result, additional inventory may be purchased unnecessarily to accommodate a perceived higher level of demand.
With asset tracking software, a business can more easily ensure the timely return of equipment and get a more accurate picture of asset availability.
5. It is difficult to effectively budget.
Without complete visibility into what the workforce is and isn’t using as well as the status of assets can result in incorrectly budgeting time and resources. Calculating the actual value of an asset is more challenging and time-consuming without an asset tracking system. And if the business has an inaccurate valuation, it may not know it is better to invest in replacing an older, poor-performing asset than allotting funds for its maintenance.
The FM team may not realize several expensive pieces of equipment have scheduled maintenance in the same quarter and thus won’t plan for costs to be higher during those months. Or what happens if the business didn’t know multiple assets were on their last leg and they all fail around the same time? This can be a major strain on a budget built by a team that didn’t know these were factors that should have been considered.
6. The business may not know it’s time for asset maintenance or contract renewal.
Relying on a printed schedule, Google doc or calendar alert to act as reminders for scheduled maintenance and impending contract or lease expirations puts an organization at risk for unexpected equipment breakdowns or fines—both of which are costly (and avoidable).
However, an asset tracking system helps facilities leaders know which assets are due for scheduled maintenance and also identify which assets have subpar performance and are in need of general servicing. Asset tracking software will inform the FM team which leases or contracts need to be renewed.
7. The organization is susceptible to “ghost assets.”
Ghost assets are listed in the portfolio as active but are, in reality, lost, stolen or otherwise unusable. Because the documentation shows the asset as available, the company will continue to allocate budget for future needs related to the asset as well as maintain insurance coverage on the asset. Employees will waste time trying to locate an asset that doesn’t exist. The business also runs the risk of violating industry regulations if they claim to have a required piece of equipment but actually don’t.
The key to avoiding ghost assets? You guessed it: an asset tracking solution.
Referring to an asset tracking solution as a lifesaver may be a bit dramatic, but it is certainly a stress reducer. And lower levels of stress have been shown to help improve longevity. Start decreasing inefficiency and your blood pressure today—invest in an asset tracking system.
There are more than a few surprising ways a company can hurt its profitability. Download our free SlideShare, Top 11 Ways Enterprise Companies Leak Money, to see what they are.