All construction firms, both large and small, rely heavily on a large number of tools, equipment, vehicles, and other physical assets. Managing all of them can be tricky just for the sheer number and size of construction projects. Having an effective asset management system in place to keep track of your physical assets of all sizes will help keep your business running smoothly.
In simple terms, asset management refers to the gathering, supervision, monitoring, and tracking of all assets owned by an organization. An effective asset management system lets a company improve the use of resources, monitor supply levels, reduce wastage, control costs, mitigate loss and theft, and improve equipment maintenance.
Looking into leveraging the benefits of asset management? Here are some of the best practices and in asset management for construction companies.
1. Sell the benefits of asset management to company leaders.
Before there can be meaningful steps towards asset management, you first need to present a good case for its benefits to top management. In an industry notorious for payment problems, mechanics liens, and cash flow issues, investing in new technology and employee training is a significant undertaking.
More often than not, company executives will want to see a tangible return on their investment should they choose to fund this endeavour. Minimizing expenses is usually one of the priorities of top management, so it is important to highlight the savings that asset management can offer.
Optimizing operational efficiency is vital in keeping construction projects on time and within budget. In order to make your case, emphasize how asset management can enable your company to improve the utilization of your machinery and consumables, order supplies when you need them, and streamline your equipment maintenance process.
Also Read: 15 Useful Asset Tracking Tips to Help You Track Your Assets
2. Understand your equipment's useful life.
One of the issues that asset managers will face in a construction company is how long physical assets such as vehicles and heavy machinery will last.
All equipment has a fixed lifespan. By knowing and understanding the useful life of your assets, you will be able to estimate when you need to dispose of old ones and replace them with new ones. This is especially important for construction firms as old and damaged assets are dangerous and have a higher risk of causing worksite accidents.
Knowledge of the life cycle of your assets also helps you make well-informed purchase decisions. By knowing the workload of a particular piece of equipment, how long you have used it, and how much you purchased it, you can look for one that is more durable for its price.
3. Schedule a regular asset review.
Knowing just the manufacturer's suggested equipment lifespan is not enough when evaluating your own physical assets. You also need to compare this to the piece of equipment's performance onsite. A periodic review of your assets is essential to determine their condition, discover their maintenance needs, fix equipment issues, and make the necessary workload adjustments if necessary.
Ideally, you should schedule an asset review once every three months. This will allow you to identify issues early on before they can have a negative impact on your construction operations.
Also Read: Which Industries are using RFID for Asset Tracking?
4. Modernize your asset management initiative.
There are countless applications that you can use to manage your assets efficiently. For instance, you can use RFID and barcodes to track supply levels, which can be scanned as they enter or leave the storage site.
Mobile phone scanners are also increasing in popularity as a budget-friendly alternative to real scanners. The only step needed is to download the software to mobile phones. Since virtually everyone has a smartphone nowadays, your employees will have easier access.
Another important consideration is your choice of asset management software. When considering an asset management software for your business, determine which information will be helpful in running the business optimally.
Look for software systems that can be adjusted to meet the needs of your company, such as depreciation calculations, profitability analysis, inventory tracking, maintenance scheduling, and report generation.
The sheer scope of construction projects makes asset management in the industry trickier than others. In order for your business to adapt, you need to leverage modern software solutions and big data analysis for more efficient monitoring of construction equipment and other assets.