In the UK alone, there were nearly 300,000 registered manufacturing businesses in 2020, with a collective estimated revenue of around £32.4 billion. The manufacturing sector is colossal in size, with much of its business value and productivity reliant on the management of its assets.
The machinery a manufacturing business uses is essentially the engine in relation to its overall mechanism. This crucial aspect must be used and maintained in carefully planned ways, in order for the desired results to be achieved. Each asset has an impactful role within the supply chain, so every single one should be optimised (so that the wider operation can function as smoothly as possible).
In this short article, we reveal exactly what is meant by asset management, what it entails, and the different types of asset management that can be employed. We also explain how software can help manufacturers master asset management, increasing their productivity and optimising their revenue.
What is asset management?
Asset management isn’t unique to manufacturing. Every business in every vertical has assets it strives to optimise, from people and software to property and investments.
For manufacturers, machine asset management (MAM) refers to the overwatch of machinery on the factory floor, while plant asset management (PAM) refers to the management of the plant buildings themselves. By 2024, PAM is expected to exceed $9 billion, at a Compound Annual Growth Rate (CAGR) of just over 11% (primarily driven by investment in cleaner, greener production methods).
What is included in asset management?
Many things fall under the purview of asset management in manufacturing, including equipment, parts, production lines and the upkeep of the factory buildings themselves. Manufacturers will have to make regular decisions about how they use assets, which assets they invest in, and the overall lifecycle of the assets they employ, including disinvestment policies.
Maintenance is another key aspect of asset management that’s often poorly optimised. Asset managers need as much detailed insight as possible into how their assets are performing, what stage of the lifecycle they’re at, and when they’re likely to need servicing.
This insight will also help to resolve issues quickly, prevent problems from occurring in the first place and streamline activity throughout a plant (or number of plants). Managing this ‘portfolio’ of responsibilities is crucial if a manufacturing business is to fulfil its potential. But it’s difficult to do well without the proper tools in place.
How to manage assets in manufacturing
Asset management in manufacturing impacts more than just the machinery and plant. It concerns every aspect of business, from human resources and staff management, to how IT infrastructure needs to be shaped and maintained. Here’s what your manufacturing business needs to consider when looking at optimal asset management:
Data generation and storage
For asset management software to work effectively, your business needs to be able to gather and store performance data from assets. Thanks to industry 4.0 and the Industrial Internet of Things (IIoT), collecting data from devices isn’t as difficult as it used to be, with onboard sensors that can relay diagnostics (and provide real-time feedback). However, how your business captures this data is crucial when it comes to being able to derive actionable insight from it.
Proper IT infrastructure
Asset management is perfectly possible with lots of Excel spreadsheets and a shared drive, but it can sometimes be a sub-optimal way of doing things. Your business could quickly develop blind spots that would eventually hinder its progress and limit its productivity. Instead, it can be far more efficient to implement an asset management system that forms part of a wider ERP solution.
Remove barriers and silos
Industry 4.0 represents the next generation of productivity, but in order for it to be successful, it requires collaboration, connectivity and the sharing of data. If your business culture is still one that’s made up of individual silos and departments that are ringfenced with their own responsibilities, consider opening up new channels of communication between those teams or restructuring to remove barriers altogether.
Choosing the right asset management software
Mastering asset management might seem daunting as we hurtle toward a new era of productivity in manufacturing, but with the right software and digital infrastructure in place, your manufacturing business will be able to maximise its productivity and be a competitive force in the marketplace for decades to come.
Manufacturing Software, for example, gives your business complete visibility and control over assets, allowing you to make better decisions and organise your processes more effectively.
If you’re a small to medium sized manufacturer, and you’re interested in harnessing the true power of asset management as we emerge from the pandemic, read more about our Manufacturing Software.