In this piece, Greg Lever of Iron Mountain explains what on earth “asset management” means – and how to manage your business equipment effectively.
Running a small business is notoriously challenging, from managing day-to-day operations and compliance to ensuring long-term growth and sustainability.
One critical aspect that often goes overlooked is asset management. Proper asset management is essential for maintaining the efficient operationally sound and profitable businesses. But what exactly is asset management, and why is it so crucial?
The fundamentals of asset management
Let’s say you run a small accounting firm, and you’ve just purchased a new computer (an asset).
If you were to manage this asset effectively, you would start by adding it to your inventory, noting its specifications, purchase date, and location.
You would conduct regular audits to check its performance and condition, and establish a maintenance schedule for software updates and hardware servicing to prevent breakdowns.
When the computer is no longer needed, you would consider redeployment for another use within the business. If there’s no need for it – or if the asset is at the end of its lifecycle – you would wipe data and recycle the hardware.
All of the above is an example of effective asset management: ensuring the computer’s value is maximised, compliance is maintained, and operational efficiency is enhanced.
In sum, here are the key stages in an asset’s lifecycle:
- Use: Deploy and utilise assets effectively to support business operations.
- Retrieval: The collection and recovery of assets when no longer needed in their current deployment.
- Maintenance: Regular servicing and asset updates to ensure they remain functional and efficient.
- Redeployment: Reassignment or repurposing assets for new uses within the organisation.
- End-of-Life: Safely and responsibly dispose of assets that are no longer useful, ensuring data is removed securely and physical items recycled where possible.
What effective asset management means for small businesses
Proper asset management helps small businesses avoid unnecessary expenses by tracking and maintaining assets, ensuring these investments are utilised efficiently and securely, ensuring compliance with regulations like the Privacy Act and the Notifiable Data Breaches (NDB) scheme, and protecting against legal penalties and data breaches.
Strong asset management practices streamline operations, keeping assets in good working condition, reducing downtime, and enhancing productivity to meet customer demands. Additionally, it provides valuable insights into asset performance and condition, helping with strategic planning and informed decision-making for future investments and upgrades.
Say you were considering new company-wide software. A narrow approach may see you focussing solely on purchasing and installing the software. However, a holistic asset management approach would consider user training, integration with existing systems, ongoing support and future scalability in the total cost of ownership and operations. Taking this broader view, you can sidestep compatibility issues and avoid costly errors from an overly narrow focus on initial expenses and features.
Best practices for asset management
- Inventory management: Maintain a detailed inventory of all assets, including their location, condition, and maintenance history. This helps you keep track of your assets and identify any issues promptly.
- Regular audits: Conduct regular audits to assess asset condition and performance. This proactive approach allows you to address potential problems before they escalate.
- Maintenance schedule: Establish an asset maintenance schedule, ensuring they receive timely servicing and updates to prevent unexpected breakdowns and extend the lifespan of your equipment.
- Disposal protocols: Develop protocols for the safe and responsible disposal of assets by securely wiping data from IT equipment and recycling physical items in compliance with environmental regulations.
- Consider outsourcing: Outsourcing can help avoid costs associated with hiring and training IT staff, purchasing and maintaining equipment, and managing other overhead expenses. Most importantly, outsourcing helps you focus on growing your business while an experienced partner manages a consistent approach for your office equipment.
Asset management strategy is crucial element of modern business success, where even the smallest first steps will positively impact your company’s bottom line and serve your business for years to come, providing a competitive edge.
