Poor asset visibility can lead to downtime, safety hazards, higher costs, and compliance risks. Learn how real-time tracking can protect your organisation.
The National Audit Office (NAO) refused to sign off UK public sector accounts in November last year. The refusal was partly a result of missing information regarding £134 billion of property and equipment. This is one of many examples highlighting how a lack of asset visibility delays audits and undermines budgeting and accountability.
But it’s not the only possible consequence, as lost and underutilised assets can also have a serious impact on operations and finances. However, thanks to real-time asset tracking, these issues are avoidable.
Operational and Financial Impact of Poor Visibility
No matter the sector, full visibility of all assets is essential if an organisation’s operations are to run smoothly. Some of the ways that poor asset visibility can impact operations include:
Operational Inefficiency
Limited visibility of assets can lead to disorganisation, resulting in production delays due to staff searching for equipment, unnecessary duplication of work, and ineffective decision-making. This disorganisation and lack of visibility can also pave the way for theft that often goes undetected. Beyond this, there’s the risk of forgotten or misplaced assets being underutilised, reducing an organisation’s return on investment.
With FMIS’ powerful asset tracking solutions, organisations can track and view any asset location, status, and history across multiple sites, companies, and countries in real time. Along with this, organisations can easily track asset events such as disposals, transfers, cost adjustments, revaluations, and status changes.
This visibility reduces the risk of these situations arising. Staff can locate equipment quickly and efficiently, while managers can make decisions based on up-to-date asset information, ensuring assets are allocated properly and used in ways that provide the most value for the company.
Manual Processes Reducing Productivity
Research shows that 10% of the average office worker’s time is devoted to manual data entry, while more than 50% of their working hours are spent creating or updating spreadsheets and other documents. Significantly more time can be spent on manual asset tracking processes, as workers need to physically search for assets, verify location and allocation, and update records.
Consequently, staff are kept away from more strategic tasks, and organisations face potentially higher overheads due to additional labour costs incurred in tracking assets. There’s also the risk of human error, especially if staff are under pressure to meet deadlines.
FMIS’ fixed asset tracking solutions eliminate the need for error-prone, time-consuming manual processes. Using bar codes and handheld scanners that can update the asset register in real-time, staff can complete physical audits quickly and accurately. They can also attach photos, warranty documents, invoices, photos, and other files to the register, and import or export data directly from spreadsheets. This speeds up the process, leaving staff with more time for strategic tasks. Plus, accurate physical audits reduce the number of write-offs, protecting an organisation’s investments.
Increased Safety Hazards and Unplanned Downtime
Out-of-date data, particularly regarding asset condition and maintenance schedules, prevents managers from maintaining equipment or infrastructure when required. Along with putting staff at risk of injury, this could result in compliance issues, reputational damage, and costly medical expenses or legal action.
Additionally, organisations may be plagued with increased downtime because of breakdowns and unplanned maintenance. The cost of unscheduled downtime alone is significant, with UK and European manufacturers expected to lose more than £80 billion to it in 2025.
The full maintenance history and other data provided by FMIS’ asset tracking software enables organisations to perform proactive maintenance. This helps ensure the safety of staff while preventing breakdowns and unplanned downtime.
Lack of Financial Control
Often a result of using spreadsheets to track assets manually, poor visibility contributes to weaker financial control. Some of the pitfalls of this approach include broken or inconsistent audit trails, inaccurate depreciation calculations, and wasting capital on duplicated assets or licenses.
There’s also the risk of making incorrect insurance payments based on outdated asset registers or incorrect calculations, which could lead to reduced coverage or delayed claims. Failing to provide proof of sufficient asset control could result in insurers raising premiums or denying claims.
Asset tracking software from FMIS makes it easier for organisations to strengthen their financial control. By offering visibility of all assets and inventory in specific locations, the software makes audits easier. It also updates the asset register in real time for more accurate audit information and depreciation calculations, contributing to greater reporting accuracy and compliance. In addition, the high level of visibility reduces the risk of repeat purchases, ghost assets, and incorrect insurance payments.
Switch to Real-Time Asset Tracking
Warren Buffett once said, “Price is what you pay, value is what you get.” However, it’s almost impossible for organisations to derive value from misplaced, misallocated, lost, or stolen assets or from staff who spend inordinate amounts of time on manual tasks.
Ensure your organisation has what it needs to track and manage assets efficiently with FMIS’ real-time tracking software. This solution helps to protect the value of your assets and the future of your company.