What is Physical Asset Management: Types, Benefits & Software Solutions

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By Amit Prasad on April 22, 2024

Physical assets are the lifeblood of an organisation. For example, hospitals own many assets for their day-to-day operations, such as expensive equipment like MRI machines or X-ray machines worth lakhs and patient beds ranging from thousands to a lakh. To handle all these assets well, hospitals rely on physical asset management. It’s like their behind-the-scenes hero, helping with tasks like keeping track of inventory, monitoring warranties, and tracking maintenance needs. Having preemptive knowledge of these things, organisations can fix issues before they become big problems and ensure their equipment lasts longer, saving them a ton of money in the long run. This blog is here to guide you on how physical asset management software can supercharge asset value.

What is Physical Asset Management?

According to The Enterprise World, physical asset management systematically oversees an organisation’s tangible assets worldwide, including machinery, equipment, buildings, and infrastructure. Effective management practices are crucial in regions experiencing significant infrastructure growth globally.
Physical asset management keeps various industries running smoothly. From factories monitoring robots for peak production to airlines scheduling aeroplane maintenance based on sensor data, this approach increases equipment functionality and longevity. In construction, it tracks machinery for strategic allocation across projects, and for governments, it maintains essential infrastructure like traffic lights and bridges.

Importance of Physical Asset Management

Physical Asset Management is vital for organisations to oversee and maintain diverse assets, from machinery to infrastructure, ensuring efficient operation and maintenance. Its significance lies in several key aspects:

  • Minimised Downtime

    Effective management reduces downtime, ensuring timely maintenance and repairs to avoid disruptions. Forbes reports that the average automotive manufacturer loses $22,000 per minute when the production line stops.

  • Extended Asset Lifespan

    It was reported in research by Aberdeen Group that proper maintenance practices can extend the lifespan of equipment by up to 30%. This translates to delaying the need for costly replacements, saving significant capital expenditure.

  • Informed Decision-making

    Data-driven insights allow organisations to allocate resources efficiently and prioritise investments strategically based on asset performance, maintenance records, and lifecycle data.

Benefits of Implementing Physical Asset Management Systems

Implementing physical asset management systems offers a myriad of benefits:

  • Improved Asset Performance

    Proper management enhances asset performance, reliability, and availability, ensuring optimal operational efficiency.

  • Reduced Maintenance Costs

    This is achieved through preventive maintenance, which identifies and addresses potential problems before they cause major breakdowns requiring expensive repairs.

  • Increased Asset Reliability

    Regular monitoring and maintenance activities improve asset reliability, reducing the likelihood of unexpected failures and breakdowns.

  • Reduced Energy Consumption

    Physical asset management systems can monitor building systems like HVAC, identifying inefficiencies and opportunities for utilisation. Studies suggest that it can lead to energy cost savings of 10% to 30%.

  • Enhanced Safety

    Effective asset management contributes to a safer working environment by ensuring that assets are well-maintained and compliant with safety regulations.

  • Compliance with Regulatory Requirements

    Businesses can comply with the industry regulations and standards by implementing asset management systems that facilitate documentation, tracking, and reporting asset-related activities.

  • Better Decision-making Through Data-driven Insights

    Asset management systems provide valuable data and insights that help businesses make informed decisions regarding asset investments, replacements, and resource allocation, helping them stay ahead in the rapidly evolving country’s market.

What are the Types of Asset Management Software

There are a variety of asset management software available, each designed to serve specific asset management needs:

  • Digital Asset Management (DAM)

    It facilitates efficient management of the digital content lifecycle, ensuring proper usage rights, version control, and metadata tagging.

  • Fixed Asset Management

    Tracks and manages physical assets like machinery, equipment, and property essential for manufacturing and infrastructure sectors.

  • IT Asset Management (ITAM)

    Manages IT asset inventory, configurations, and software licences, ensuring compliance with licensing agreements and security protocols.

  • Enterprise Asset Management

    Integrates various asset management functions across departments, essential for large conglomerates with diverse operations.

  • Financial Asset Management

    Focuses on managing financial instruments such as stocks, bonds, and derivatives. It involves portfolio management, investment analysis, and risk assessment, aiming to maximise returns while managing risk according to investment objectives.

  • Infrastructure Asset Management

    Used to manage physical infrastructure assets like roads, bridges, utilities, and public facilities. It includes asset inventory, condition assessment, and maintenance planning to increase infrastructure performance, longevity, and cost-effectiveness.

Selecting the Right Asset Management Software

When choosing asset management software, organisations should consider several factors:

  • Flexibility and Scalability

    Make sure that the software can scale with the organisation’s growth and adapt to evolving business needs.

  • Integration Capabilities with Existing Systems

    Go for software that flawlessly integrates with existing systems and technologies to avoid disruptions and streamline operations.

  • User-Friendly Interface for Easy Adoption

    Choose software with an interactive interface and user-friendly features to promote adoption and make sure employees can effectively utilise the system.

Final Words

Effective physical asset management is a strategic investment that helps organisations to maximise resource utilisation, reduce costs, and achieve peak operational efficiency. By implementing a powerful asset management system and leveraging the right software solutions, businesses can utilise their physical assets to deliver maximum value throughout their lifecycle.

Arm Your Organisation with QuickFMS’s Asset Management Software.

If you want to streamline your asset management processes and maximise the value of your assets, consider leveraging QuickFMS‘s comprehensive asset management software solutions.


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FAQs

How does asset management software benefit small businesses?

Asset management software boosts efficiency, reduces downtime, and cuts costs for small businesses.

What are the challenges in implementing asset management software?

Challenges include data accuracy, integration with existing systems, user adoption, and ongoing maintenance.

Can asset management software be customised to specific industry needs?

Asset management software can be customised to meet specific industry requirements.

Content Sources:

The Enterprise World, Forbes, POWER, MDPI