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What Is Asset Management?

by gbaf

If your company is big or small, you need asset management software to help you stay on top of your responsibilities. Asset management software (AMS) automatically gathers all that data together and then compiles reports to help the company determine the optimum use of its resources. AMS also allows you to make better choices when it comes to spending your company’s money. There are many different types of AMS applications, but the best one for most companies is Custodian AMS.

Custodian AMS is among the best asset management softwares available, according to many business reviews. Its user interface is simple and easy to understand, yet powerful enough to handle all kinds of asset management practices. For instance, Custodian AMS allows you to organize, classify, tag, and manage physical assets, including manufacturing equipment, fixed assets, and even inventory. All these functions are performed in an economic cost-effective manner.

When it comes to physical assets, Custodian AMS helps you keep track of them in a simple way. It can organize them into various categories, and each category has tabs for maintenance, servicing, and upkeep. Once you know how much you’re spending on each category, you can easily see where you can cut back or increase maintenance. For instance, if the costs of maintenance for your plant and equipment is more than 50 percent of the company’s total assets, you can immediately reduce expenses there.

One of Custodian AMS’s core features is asset management by life-cycle management. It looks at how well your plants and equipment are maintained over their lifetime, as well as their ability to produce revenue. This feature reduces the costs of overhauling or replacing outdated assets, which in turn lowers operational costs and increases profitability.

Asset management by life-cycle begins with asset life-cycle management. This section focuses on identifying ISO 55000 compliance, which outlines the standards that asset life-cycle needs to follow. Once this is established, the system identifies the most effective and efficient operational methods, which include scheduling, costing, and production planning. Asset life-cycle software also includes an analysis tool that allows the identification of the most economically viable operational processes and techniques.

An important aspect of asset management definition is cost-effectiveness. It follows that the best way to determine the value of your assets is to determine their cost in terms of their life-cycle. This is determined through a number of methods, including the cost of replacement, discounted cash flow, cost-of-wear, repair cost, and net present value. These values are derived by taking into consideration the present day supply and demand for the asset class, industry standards, and other relevant external factors. The most common method of determining cost is discounted cash flow, which utilizes a discounted cash-flow model to give the calculation of expected cash flows over time.

Another factor that is often ignored when developing an asset management process is the impact of inflation on the value of assets. Inflation affects the price of materials and the price of labour as well, and the effects of inflation on the price of physical assets can be severe. Therefore, companies often review their asset management processes to identify where they may have over-estimated the value of their physical assets, which leads to poor cost allocation strategies. Moreover, companies that underestimate their capital requirements often find that their assets are under-utilised, leading to under-utilisation of productive assets, which further depletes the company’s capital.

To bridge the gap between short-term and long-term profitability, today’s asset management processes utilise engineering controls to identify the correlation between costs and performance. They use the life-cycle framework to identify risks and use technical analyses to mitigate these risks. By identifying risks, and tailoring solutions to mitigate them, asset management ensures that the company is able to adjust its short-term and long-term asset management needs as resources become available. Companies that fail to address the issues of waste, obsolescence when designing their asset management policies face the risk of being unable to meet their short and long-term objectives. This can lead to a loss of market share, reduced customer satisfaction and ultimately, failure in the company’s ability to remain financially viable.


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