As your business grows, so does the number of assets you have; if you are not careful, you can easily lose control of your assets. From computer software to onsite equipment, your business is built and runs on the assets you invest in. Poor asset management can be the beginning of the end of any business as it can produce a number of negative consequences.
- Low Return on Investments
All assets cost money; when you invest, you usually do so with the understanding that it will pay off long term. However, if you do not properly manage your assets, you are losing out on your potential return. This is because you will not have assets to the information you need to rectify issues as they occur, resulting in potential loss of productivity and damage to assets. You will also lack the foresight necessary to conduct regular checks that are needed to prevent future downtime.
- Increased Insurance Costs
If you are unable to comply with standards and properly manage your assets, this will likely have an effect on your insurance premiums. Specifically, you will likely see your insurance rise as a result of poor asset management.
- Security Risks
Poor asset management can threaten the security of your business, as your software and hardware are likely left vulnerable. Out-of-date security measures and unprotected software can make your business a target to cybercriminals. Being the victim of a cyber-attack can have a number of following consequences. You might experience major downtime as a result of a cyber-attack; you could have your business data held to ransom or face legal consequences as a result of lost customer data.
- Reduced Productivity and Efficiency Rates
If you struggle to manage your assets, then this will likely affect your internal productivity rates, as staff have to spend more time locating, fixing, or updating your assets. Poor asset management has also been linked to an increased chance of experiencing errors. This increase in errors is also likely to affect your internal productivity and efficiency rates.
How to Rectify Poor Asset Management
With the consequences of poor asset management having the potential to threaten the long-term growth potential for your business, improving asset management should be a top priority. Businesses that are struggling with asset management might assume that a solution will be costly and time-consuming; this is very far from reality.
Using total asset management (TAM) software enables you to manage your asset portfolio from any location more effectively. This software will help you to keep track of all of your assets, their location, their status, and their maintenance schedule. Being able to access all the information you need from one location makes the otherwise complex process of managing business assets plain and simple.
Poor asset management can spell disaster for businesses, draining your productivity rates, your available capital, and growth potential. However, utilizing the right technology means that businesses no longer have to suffer the consequences of poor asset management.