Implementing the right asset tracking system for your company or organization is a major step in better employee communication, improved efficiency, and increased data flow that aids in decision making.
Maximizing the benefits of asset tracking will help you make the most of your system.
While this post is useful to everyone along the supply chain, including consumers, it’s especially helpful for COOs working with many physical assets, employees dealing in field work, and managers overseeing a wide variety of equipment.
Read on to learn more about the difference between asset tracking and inventory tracking, when to enter assets into the system, which asset tracking software to use, and much more.
1) Understand the Difference Between Asset Tracking and Inventory Tracking
Asset tracking and inventory tracking are two different activities, so it’s important to note the difference between the two terms.
Assets are what a company holds ownership of, and inventory is the physical goods it sells. A company, therefore, can have assets, but not inventory.
For example, a medical spa might have possession of body slimming machines and the equipment to give a facial, as well as office furniture, laptops, and waiting room furniture.
As it sells no physical items, only the services it provides to its customers, the spa has no inventory in the technical sense, unless it carries many medical supplies, requiring constant restocking.
On the other hand, an auto parts store might own hundreds of thousands of items of inventory. They are meant for fast dispatch and rarely require maintenance.
Assets depreciate over time and require management, as well as regular maintenance. They are seldom sold, except perhaps at the end of their life cycle.
Many are fixed assets, which means that they do not move from the place where they are initially anchored.
Conversely, inventory is quickly moved from the supply chain to the customer’s hands, or back out into the supply chain to meet client demand.
Both, however, require tracking.
Even fixed assets, which don’t leave the building in which they are installed, need maintenance tracking.
2) Track Assets as They Come
Establishing a new asset tracking system requires tagging and scanning each item, but once asset tracking is part of a company’s daily, monthly, and yearly rhythm, regular tasks become more automated and communication takes place instantaneously.
However, employees and decision makers might wonder what to do with new assets when they arrive on the scene.
Preparing for this moment is key.
When the entire team understands how new assets are integrated into the system, adding them in is a simple task.
Nevertheless, stacks can easily accumulate in busy seasons, and employees who are not properly trained on this task might enter them incorrectly or not at all.
The asset is outside the fold of the rest of the network, and as good as lost.
Incorporating the item in maintenance calculations again and locating it if a team member needs it will require extra time and resources. These scenarios defeat the point of a strong asset tracking system.
Instead, best practices dictate including the assets as soon as they arrive in an office, warehouse, or work site.
3) Keep the Project and Asset Life Cycle in Mind
Not one, but two life cycles should be considered while managing an asset.
These include the life cycle of the asset itself, as well as the life cycle of any major projects with which it is involved.
These are the stages of an asset’s life cycle:
- Researching which type of asset is best for the needs of the company
- Acquiring the asset (designing, constructing, or purchasing)
- Using the asset
- Maintenance of the asset, both preventive as well as reactive
- Potential long-term care
- End of life care: Disposal, recycling, donating, rehabbing
An asset’s life cycle could be as short as a few weeks, or as long as many years. When the asset includes a building or land, management of it could stretch across generations.
The amount of upkeep, insurance, and unique requirements the item might demand should become part of the process from the beginning of the research and acquisition process.
For example, if a museum accepts a painting donation to its collection, all of these aspects apply—including, the process of finding a new home for the item, in case the facility closes or dissolves.
More often, however, an asset is only within a company for a limited time. Sometimes the asset outlasts a project with which it is affiliated.
On the other hand, sometimes the item’s life cycle will coincide with the life cycle of a project.
For example, perhaps a construction project is taking place across many months in a difficult-to-reach, high-altitude location, and involves intense exposure to the elements.
Here are some variables to keep in mind if specialized equipment is required in a case like that.
- Is it worth it to keep and maintain the asset after this project is over, or beneficial to the company to maintain it in the hopes a similar job will materialize?
- Or is it better to place it on the marketplace for an immediate recoup for part of the investment?
The careful study of data, company resources, long-term plans, and market trends are especially important in these scenarios.
4) Define Who Is Responsible for Assets and Work Orders
Smart division of labor is often an underrecognized aspect of asset tracking and organization. It is enormously effective in increasing employee engagement and accountability.
Taking this step helps answer a variety of questions concerning an asset, such as:
- Who was the last to have the item?
- How long does an asset stay in a department?
- Which travel routes are most efficient?
- How is performance affected by such factors as the time of day, location, or operator?
The right system will enable stakeholders to make these conclusions based on relevant data collected in the field.
Where work orders are concerned, delegating certain assets ahead of time allows for more efficient planning. It also eliminates confusion as to which operator is expected at each worksite.
This practice is extremely helpful when it comes to scheduling preventive maintenance or planning for a particularly busy time block.
In addition, major maintenance or rehabs can coincide with a less active period. This kind of wise asset planning lessens employee frustration and ensures that all equipment is in good working order when it is most needed.
5) Use Unique Asset Tracking Numbers, Not Serial Numbers
It’s tempting to double an asset’s serial number as its tracking number. After all, it’s already assigned, so it would reduce opportunities for confusion when communicating with the asset’s manufacturer or a specialized repair crew.
However, working with a unique asset tracking number is worth the time and carries a number of benefits:
- Avoids potential duplication within a company’s own system
- Eliminates having the same asset tracking information as another organization
- Provides a secure means of identification in the event of loss or theft
- Clears confusion in the event of department or branch merges
Serial numbers are the same for potentially thousands of the same assets across the world. Doubling their use in-house for tracking purposes invites confusion.
However, if a company chooses the right asset tracking partner, it won’t have to worry about generating unique tracking numbers on its own. GoCodes provides a globally unique ID for all clients and items.
6) Choose the Right Asset Tags
Best practices in selecting the right asset tags or labels require careful thought about how the asset will be used, as well as where.
Some items will never see the light of day; others will spend the majority of their lifecycle outside.
The amount of vibration, duration of use, consistency of movement, and type of material should all come into consideration.
Making this decision, then, should involve consulting with operators, managers, fabricators, and material specialists.
It doesn’t make sense to invest in an asset tracking system with unsuitable tags that will prevent scanning.
Fortunately, asset tag material comes in as many forms as the assets themselves. They can be welded into place, ready for extreme temperatures and moisture, or carefully adhered to delicate material.
Some items might experience constant motion, or the atmosphere and conditions around them might require monitoring as part of the tracking process.
For example, a facility working with cryogenic materials must constantly take ambient temperature and humidity into consideration.
You can find out more about the best asset tracking practices, including what to include in asset tags, here.
7) Use Software With Strong Reporting and Analytics Functionality
Good asset tracking software offers comprehensive reporting and analytics.
This allows the instantaneous generation of reports tailored to the needs of the organization, the auto calculation of data, and GPS tracking information.
These advanced analytics benefit the company at all levels, empowering decision makers to plan for the movement of assets and potential downtime for maintenance.
Tracking software is flexible and scalable.
The right choice is useful to a small home business or a major international corporation alike. It’s also scalable and easily adaptable to changing seasons, regulations, and economic conditions.
Installing this software along with a base tracking system allows for a reliable and recently updated data stream. It allows companies to manage inventory as well as assets.
8) Make Sure You Are Always Able to Track Your Assets
The ability to instantly locate assets carries many benefits that make this feature indispensable, even if the asset doesn’t change hands very often.
Even valuable, big-ticket fixed assets can benefit from a GPS tag. Some can be tracked in real time, or scan to scan.
The features of enabling location tracking include:
- Compliance with local, state, and federal regulations
- Assistance for law enforcement
- Retrieval of items due to theft
- Quick location if the item is mislaid
- Ability to analyze efficiency when experimenting with supply chain modifications from scan to scan
Adding this information to an asset’s data stream can be as fast as a scan on a smartphone—with no specialized equipment necessary.
Harnessing the many options QR barcodes offer is a building block of smart asset tracking.
9) Understand Asset Depreciation
Asset depreciation refers to the deduction of the cost of an item over time. Asset depreciation takes place throughout the useful life of an item, and can help organizations plan for outlay where replacements and repairs are concerned.
Calculating depreciation is also useful when considering tax liabilities and responsibilities.
Some items depreciate faster than others.
The right software is extremely useful in calculating asset depreciation. Some types of software even do this automatically.
This is especially useful in situations in which an asset is suddenly sidelined by accident, weather, or intentional vandalism.
Unexpected and severe damage often puts stakeholders and decision makers in a quandary; they might not be sure whether it’s a better investment to repair the current asset or submit to the purchasing process to acquire a new one.
Understanding asset depreciation, however, makes this decision easier.
10) Eliminate Ghost Assets
Ghost assets are a frustration to companies of all sizes. They are assets that are no longer usable, be it due to damage, loss, or theft, but reflect as active or usable in a company’s records.
Ghost assets make for incomplete records, inflated taxes, and inefficient productivity.
They result in frustrating, fruitless searches for employees and operators, as well as potentially disappointed clients.
The elimination of ghost assets is fast and easy with asset tracking software.
The organization starts with a clean baseline when first scanning assets into a new system and the information is easily and quickly revised when an item is deactivated.
Items are instantly updated across an entire organization, and these changes are reflected no matter where an employee is accessing the information.
Using asset tracking tips as a guideline to make the most of your system helps to avoid employee confusion, streamline data, and provide an accurate, real-time idea of the state of each asset within an organization.
Regardless of whether an asset is traveling through a supply chain or doing its job from the same place it always has, making informed choices and investing in the right equipment yields immediate dividends.