Asset maintenance is the term for routine tasks carried out to keep an asset operating as intended. Meanwhile, asset management is the practice of increasing total wealth over time by acquiring, maintaining, and trading investments that have the potential to grow in value.
Asset management is important because it enables a company to keep track of and manage its equipment and assets in a systematic manner. The dual objectives of asset management are to increase value and reduce risk. In other words, the client’s risk tolerance is the first thing to be discussed. Risk-averse individuals include retirees who rely on portfolio income and pension fund administrators who manage retirement assets. Any adventurous person, especially a young person, would wish to experiment with high-risk ventures.
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Prevent Unplanned Downtime
Downtime is a fact of life in plant management. Downtime is expensive, whether it results from a failure or even from planned maintenance. However, unanticipated downtime is more expensive. If a faulty component causes your production line to stop abruptly, for instance, you must take the necessary time to locate the issue, resolve it, and then confirm that there are no other issues before restarting. Planned downtime can be beneficial. It enables engineers to upgrade equipment and swap out worn-out components.
Unplanned downtime, on the other hand, is a different matter. Unplanned downtime occurs when assets unexpectedly break down. This necessitates urgent repairs in addition to a suspension in production. Something that isn’t always financially feasible. Equipment failure or inefficiency-related downtime can result in severe production losses for businesses. Equipment that has been properly maintained performs well and is less likely to malfunction, maximizing daily output and reducing expensive downtime.
Hold Asset Depreciation
How much of an asset’s value has been used is shown through depreciation. It enables businesses to purchase assets over a predetermined length of time and generate income from those assets. Assets are depreciated to more properly reflect the financial health of an activity, to account for the loss in value over time and, in the case of self-supporting units, to provide money for replacement of the item when it reaches the end of its useful life.
The immediate cost of ownership is greatly lowered because businesses do not have to fully account for them in the year the assets are purchased. Depreciation is the process of writing off an asset’s value over the course of its anticipated useful life. The asset’s value decreases over time, and each year you are allowed to deduct a specific amount from your taxes as an expense. Even though you might have to pay the entire cost up front, you cannot write off the entire amount as a single tax deduction.
The ultimate stage of an asset’s life cycle is disposal and renewal. This implies that an item is replaced once it has served its purpose or is too expensive to restore. Despite the fact that aging is a natural process, the speed at which an asset ages shouldn’t affect its integrity. It’s time to think about a functioning maintenance plan if asset integrity is declining. That’s where asset maintenance would be really helpful.
Improve Asset Performance
Your prosperity depends on your heavy machinery and facilities, but they need regular upkeep and repairs. Your asset’s performance will be better if you can balance high performance with maintenance. This is why asset maintenance is important. In the end, this is an important statistic for not only evaluating performance over time but also for benchmarking against peers and proving your worth to management and investors.
Asset performance affects a wide range of industries, including manufacturing, construction, energy, and transportation companies, due to how crucial it is to heavy equipment. Asset performance refers to a business’s ability to take operational resources, manage them, and produce profitable returns. A corporation can get the best performance possible out of its assets, improving overall performance.
Measures of asset performance include ratios like return on assets (ROA) and other indicators that track how well a company uses its assets to produce revenue and how effectively operations are being conducted. For every firm, asset performance is essential. Downtime increases when an asset isn’t functioning. Every businessperson is aware that unplanned downtime results in loss. Loss in a variety of ways, including maintenance costs and reduced production.
Ensure Repairs Time
In order to ensure that the company’s assets continue to operate properly or even increase productivity, industrial solutions for maintaining production assets must be considered. This service aims to ensure that all assets, factory machines work optimally so that they do not raise costs for repairs and even replacements. There is also this thing in asset maintenance called Mean Time To Repair (MTTR). It is a maintenance metric that calculates the typical amount of time needed to fix an asset, from the time an incident happens until it is put back into use.
It alludes to the length of time required to remedy a problem with a wrench. The mean time to repair (MTTR) also shows how quickly a company reacts when an unexpected failure occurs. This measure can make maintenance process issues that pertain to fixing things visible. There are a few steps in MTTR such as:
- Diagnosing the issue
- Fixing the issue
- Reassembling and calibrating the asset
- Setting up, testing, and starting the asset back up
In order to decide if it is time to repair or replace an asset, you must compare the current value of the asset with the cost of repair. Simply put, you should repair a piece of equipment if the cost of repair is less than the equipment’s value. You should replace an asset if the cost of repair exceeds the asset’s value.
Healthy and Safe Workplace
A safe and healthy workplace is very important for the continuation of a company. Why? So that productivity can run smoothly, of course the safety and health of employees must be guaranteed as well. Workplace safety depends on the care of company assets. How they maintain and manage it. The major goals of asset maintenance are to guarantee efficient daily operations and foster a secure workplace. Investing in high-quality asset maintenance will also guarantee that you get the best return on your investment.
In both direct and indirect ways, a safe workplace can lessen the losses brought on by accidents at work. First of all, it assists in lowering the direct expenses associated with non-fatal workplace accidents, such as medical expenses and employee time off. Indirectly, a safe workplace increases productivity, draws top talent, and improves retention rates, all of which have a positive impact on revenue and decrease expenses.
Well-maintained equipment and property assets such as stores, buildings, and facilities are less likely to be the cause of incidents. Therefore, maintaining assets helps to maintain workplace safety. By doing this, you can prevent your firm from being sued for negligence while also preserving your company’s reputation.
The company can keep track of all its assets thanks to asset management. It can reveal the assets’ physical location, their intended purpose, and the dates of any modifications. The asset management solution’s data can guarantee that asset recovery will produce higher returns. In order for an asset management plan to be effective, it must be supported by a system that can keep track of and maintain valuable assets. That system is HashMicro Asset Management.
You can get maximum control of your assets. And of course, track the usage of the assets, schedule maintenance, calculate the ROI & expenses, and know your asset value automatically. HashMicro Asset Management has a lot of benefits and interesting main features to offer you. Its system integrates with; purchasing system, accounting system and HRM system. Those system integrations will definitely help you in maintaining and managing your asset effectively. Try the free demo and you will experience how asset maintenance could be so effective and efficient.