Large enterprises find themselves acquiring a lot of assets throughout their lifetime. These assets range from costly investments such as buildings to meager purchases such as printers and shredders. Assets can cost the company a lot of money if not properly managed.
This is why Enterprise Asset Management came into play. EAM is the management of all the assets of a company with the aim of reducing running costs of the company and maximize effectiveness of the assets. Here are 7 ways to improve your Enterprise Asset Management.
1. Keep up with technology
The age of computers really changed the business world. They have brought about easier and faster ways of information sharing, communication, data storage, data analysis and many more. Thousands of new innovations are coming up every day. With each new innovation, there are chances that some of the company’s assets may become irrelevant.
It is a good idea for enterprises to be quick in finding out how any new inventions may affect the running of their business. If there are new ways of getting things done faster, then the company should start thinking about how to adapt to such new advancements.
2. Constant communication
This ensures a company always has up to date data. All assets acquired by a company should be recorded and the information communicated to all the relevant stakeholders. Having inconsistent data can lead to wastage of resources.
A good example is where different branches want to expand or acquire an asset in a particular area. The two branches might set their sights on different buildings in said area. If they proceed to purchasing the asset, the company will have wasted money that would have rather been put to better use.
This issue could have easily been avoided if the two branches were in constant communication with each other. The managers would have been able to make appropriate decisions on how to cut costs before acquiring assets.
3. Constantly review use of resources
In a large company, the operations may change over time. This is usually brought about by necessity: in order to catch up with the competition, in order to meet consumer needs etc.
A company that used to manufacture and sell CRT monitors will have to conform to the current technology standards and start selling LCD monitors.
In the process, some of the assets that were used in the production of the previous product may become obsolete or irrelevant. It may be cheaper to acquire equipment that are better suited to the production of the new product.
An enterprise should constantly be on watch to ensure they notice such changes and act on them immediately to ensure they minimize costs.
4. Consider company future
An analysis can be carried out to predict future growth of the company. According to a company’s goals, they may only need the use of certain assets for a specified amount of time. In such a situation the company may prefer to lease the asset rather than purchasing them.
If this is not possible, it may be better to acquire a small or limited number. Otherwise the company would end up with a store full of irrelevant assets.
5. Employee education
The management of a company can do their best to make sure the company minimizes the running costs by proper asset management, but all their effort will be rendered useless by extravagant employees.
The employees should be advised on proper use of assets and best practices to avoid damaging them. If resources are used for the right purpose they end up lasting longer and provide service for a longer time.
6. Avoid unnecessary utilization of assets
A company should minimize use of its resources wherever possible. If there are any operations of a company that could be accomplished with involvement of less assets the better.
A deep analysis on how the company uses resources should be carried out to identify any such areas.
If the above steps prove too hard for the enterprise to carry out, they can always outsource the service. There are many companies out there which are specialized in these activities and can provide their services to you at affordable costs.
You can also purchase software that allows you to manage your assets easily from your computer.
Creating an entirely new department responsible for managing assets is accompanied by a lot of unnecessary hustle. Holding interviews and vetting applicants takes up a lot of time and in business, time is money. Large companies prefer to hire already established companies.
For any company that wants to be in business for the long run, Enterprise Asset Management is something you cannot neglect.