Learn More About Asset Tracking Software
What is Asset Tracking Software?
Asset tracking software manages the physical locations and the availability of fixed assets and equipment. Asset-intensive companies use asset tracking solutions to optimize workflows for asset allocation, improve inventory management, and monitor the status of their assets. This software helps organizations locate and replace lost or missing physical assets and those that can no longer be used or have value.
What Types of Asset Tracking Software Exist?
Asset tracking tools are very similar, and there are very few variations of this type of software, the most important being:
Standalone or add-ons
Asset tracking software is provided as a standalone product or as a part of CMMS software or enterprise asset management (EAM) software. When delivered separately, asset tracking software is integrated with other asset management software.
Industry agnostic or vertical focused
While most asset tracking tools offer similar features, some of them focus on specific industries such as manufacturing or oil and gas.
What are the Common Features of Asset Tracking Software?
Creates asset registries (or lists of assets): Asset registries (or lists of assets) are complete listings of a business or an entity's physical resources. Asset tracking software helps to list and track the date assets were purchased, calculate their value, and identify their physical locations at any given time.
Manages asset categories: As an asset is purchased, sold, or no longer holds any value, it needs to be correctly recorded on an organization's balance sheet and cash flow statements. This is why asset tracking software must have the ability to classify and manage different asset categories, such as fixed, current, and noncurrent. Depending on what type of asset a company has, it might be recorded as a cash inflow, outflow, or entirely written off the balance sheet if it no longer has monetary value.
Tracks various types of assets across multiple physical locations: Asset tracking software can track the physical movement of assets by tagging them with multiple technologies. These tagging technologies typically include RFID tags, QR codes, and barcodes. As an asset tag is scanned, its location and the user who checked it would be updated and stored in the software, which shows exactly where each asset is and has been. This feature helps management review previous asset movements for future planning and continuous improvement.
Includes geographic information system (GIS) technology to track assets: GIS collects and analyzes many different types of data to create visualizations using maps. These maps contain locations, routes, geographic features, and other spatial information that asset managers can use for a deeper dive into data to uncover patterns, solve problems, and make smarter decisions.
What are the Benefits of Asset Tracking Software?
Asset tracking software provides many benefits to its users across an organization with fixed, digital, or IT assets being stored and transferred between physical locations. Some of the most important benefits are below.
Accurate asset registers: This software helps to maintain a detailed list of business assets, which includes relevant asset information, such as the owner, location, current condition, and warranty status. This registry allows the business to consistently know the current value, price, status, and depreciation of each asset, to name a few.
Reduced costs: Asset tracking software reduces costs by implementing proactive maintenance on assets that would otherwise require more significant amounts of capital if they failed in the future. This software can also monitor the status and location of assets to help prevent employee theft and automatically account for ghost assets and remove them from the general ledger (GL). This benefit helps avoid overpayment of taxes and the replacement of assets unnecessarily.
Improved inventory management: Asset tracking software helps automatically count inventory and automate the purchase of more goods when a low stock level is triggered. This helps to cut down on manual inventory counts, which are time consuming, expensive, and open the door to potential miscounts or inaccurate information due to human error.
Increased visibility: Asset tracking software gives managers and workers the visibility required to increase productivity and efficiency and reduce both property loss and search time as items move through all stages of daily operations. It also helps to locate, manage and track assets, people, and equipment worldwide. This visibility streamlines and automates workflows and processes that reduce downtime, waste while improving productivity.
Improved data accuracy: Data collected and analyzed through asset tracking software can help managers to make informed decisions and identify opportunities and inefficiencies in processes. This software helps with this by collecting and analyzing real-time data while keeping it contained and accessible through one central repository.
Who Uses Asset Tracking Software?
All employees that use or manage assets and equipment can benefit from using this type of software, but asset tracking is critical for the following roles:
Asset managers: This type of software is used by maintenance technicians and supervisors for asset tracking. This includes the physical location of equipment and tools, their value, status, and warranty information. Maintenance work relies on the asset registries and the GIS positioning provided by asset tracking solutions. Accurate tracking improves maintenance management and reduces downtime.
Field technicians: Employees responsible for field service activities may use asset tracking to manage asset availability and their physical locations. In some cases like facility management services, field service technicians cannot perform maintenance without tools and equipment, making asset tracking critical for their work.
Operations managers: Production and warehouse managers use asset tracking to streamline operations based on each piece of equipment's availability. For example, forklifts are used to unload trucks and to move heavy items between locations of a warehouse. Since logistics companies have a limited number of forklifts, warehouse managers need to optimize their performance by planning and monitoring their use.
Accountants: Accountants can also use asset tracking software for asset depreciation or the changes in the asset value during its lifecycle. Assets and their maintenance are a critical component of the total cost of products and services.
What are the Alternatives to Asset Tracking Software?
Alternatives to asset tracking software can replace this type of software, either partially or entirely:
CMMS: CMMS is a good alternative when buyers need functionality for asset lifecycle management, not only asset tracking. Using CMMS for asset tracking only is not recommended. The only exception is when a company uses CMMS in multiple locations, and some of them only use the system for asset tracking.
IT asset management software: IT departments can theoretically use asset tracking software but would benefit more from adopting IT asset management solutions designed for their specific needs. Other than tracking, IT assets like hardware and software require regular updates and policies and procedures related to privacy and security.
Tool tracking software: Tool tracking software is a light version of asset tracking, which helps companies track small equipment and tools rather than fixed assets. For instance, a cleaning business needs to track tools like vacuum cleaners, pressure washers, or floor cleaning machines.
Fleet tracking software: While vehicles are fixed assets, tracking them is challenging because they’re always moving. GIS is therefore critical to monitoring vehicles as well as drivers in real time. Furthermore, companies need to track mileage for vehicles to determine their performance and to schedule preventive maintenance.
Software Related to Asset Tracking Software
Related solutions that can be used together with asset tracking software include:
Inventory control software: Other than assets and equipment, companies also need to manage the inventory of spare parts and accessories required for maintenance and repairs. Inventory management is crucial when companies have multiple locations with a high volume of inventory.
Job shop management software: This type of software focuses on the needs of small manufacturers with basic operations such as assembly and kitting. The equipment used by these companies is not complex enough to justify an investment in CMMS software, thus making asset tracking the optimal choice.
Calibration software: Employees use calibration software to ensure that equipment and tools function within the standard parameters defined by the manufacturer of the assets. Calibration requires measurement tools that can also be managed using asset tracking software.
Field service management software: Companies that use assets for field operations need to integrate their asset tracking software with field service management. This allows dispatchers to schedule work based on the availability of their assets and technicians.
Challenges with Asset Tracking Software
Asset tracking software solutions can come with their own set of challenges, the most important being:
Narrow scope of the software: While asset tracking software is the best option for SMBs, some companies outgrow this type of software and need to replace it with more advanced asset management systems such as CMMS or EAM solutions.
Integration: Asset tracking needs to integrate with multiple types of software, from ERP and accounting to inventory control and field service management. Cloud or SaaS solutions are easier to integrate through APIs, but ERP and asset tracking tools can still be used on-premises, making integration challenging.
Which Companies Should Buy Asset Tracking Software?
Any company that uses equipment and tools can use this type of software, but it is beneficial mainly for asset-intensive companies, such as:
Manufacturers: Manufacturing companies use assets for production and need to know which assets are used where and how. Planning production operations depends a lot on the availability of the equipment necessary to manufacture goods.
Retailers: Retailers and distributors rely on equipment such as forklifts to ensure that stores are fulfilled efficiently. It is also essential that retailers monitor asset usage across multiple locations such as stores and warehouses.
Repair services providers: Professional services companies that focus on maintenance and repairs need to track the tools and equipment used to perform work. In some cases, they may also monitor the assets of their customers.
How to Buy Asset Tracking Software
Requirements Gathering (RFI/RFP) for Asset Tracking Software
Requirements should focus on asset tracking functionality, not on broader features for asset management and maintenance. Industry-specific features are also important such as mobile apps for field service or integration with ERP systems for manufacturing.
Compare Asset Tracking Software Products
Create a long list
A long list includes software that provide core features for asset tracking, such as inventory management, work orders, barcode scanning, and asset registries and maintenance history.
Create a short list
The short list can be created by eliminating products from the long list based on various criteria. For example, GIS tracking isn't always included, and field technicians need mobile apps that can be used online and offline. Buyers can also use references and user reviews to eliminate products from the long list.
Conduct demos
A demo should focus on the critical functionality to the buyer, not on generic features provided by most asset tracking solutions. Ideally, buyers should see how the system manages operations similar to theirs. Tracking assets in a single location can be very different from monitoring equipment used in the field.
Other factors to consider are the ease of use of the system, its compatibility with hardware such as barcode scanners, or the ability to generate custom reports.
Selection of Asset Tracking Software
Choose a selection team
The selection team includes asset managers and the members of the maintenance team that will use the software. Depending on the buyer's industry, other managers may be involved, such as production managers in manufacturing or project managers in professional services.
Negotiation
While the price and incentives like discounts can be essential in negotiation, the functionality should take precedence over cost. Software that doesn't cover the main requirements of the buyer may be affordable, but the company may need to invest in additional technology. For example, if the solution does not provide GIS tracking, the buyer will have to buy separate software for GIS.
Final decision
Asset managers should make the final decision by selecting the software that provides the best features for the company.
What Does Asset Tracking Software Cost?
Direct costs comprise software licenses, implementation, customization, support, and services. Indirect costs refer to the financial impact of the migration to a new system and expenses associated with the software. For instance, buyers may need to buy rugged mobile devices or barcode readers to optimize the use of their asset tracking software.
Return on Investment (ROI)
Positive ROI is achieved when the benefits exceed the costs of the system. To calculate ROI, buyers need to estimate the benefits' numerical value and then compare it with the total cost. For instance, if technicians spend less time looking for equipment, the benefit realized can be estimated by multiplying the time saved in hours and the average salary per hour.
Implementation of Asset Tracking Software
How is Asset Tracking Software Implemented?
Depending on the complexity of the system, asset tracking can be implemented by the buyers' in-house teams or through collaboration with the vendor and its partners. Medium and large businesses with multiple locations benefit from using a phased approach to the implementation. This means that each site is implemented following a predetermined schedule, not at the same time.
Who is Responsible for Asset Tracking Software Implementation?
The implementation team should always include asset managers from the buyer and project managers from the vendor. IT managers and other executives can also be involved, as well as external consultants with implementation experience.
What Does the Implementation Process Look Like for Asset Tracking Software?
The implementation team works closely with the vendor to plan the deployment. The plan includes stages such as data migration, software testing, training, and the go-live date. All asset data from previous systems or data sources are consolidated and cleansed before being imported into the new system.
When Should You Implement Asset Tracking Software?
While there is no ideal time to implement asset tracking, it is recommended that buyers avoid peak periods when assets are used at maximum capacity. The company cannot afford to disrupt its operations. The timing for implementing asset tracking also depends on other software deployment projects. For instance, a company deploying a CMMS or EAM system in multiple locations and a separate asset tracking tool in another site should synchronize the implementation across all business units.
Asset Tracking Software Trends
Market consolidation
Many asset tracking software products either evolve into CMMS solutions or get acquired by CMMS vendors.
