Physical assets are one of the most expensive items in your company's budget. It is critical to manage their lifecycle and maximize their potential efficiently.
Enterprise asset management (EAM) enables a systematic approach to asset usage, procurement, and maintenance and is an excellent tool. This software allows for digital asset tracking, increasing the practice's value.
There are numerous options for people looking to purchase EAM software. This is the most important question. Is it a standalone application or a component of your ERP?
This article will go over enterprise asset management software in greater depth and assist you in selecting the best option for your business operations.
What is ERP?
ERP is an abbreviation for enterprise resource planning. ERP systems can manage various operational tasks across industries and business types. It is often called the software industry's "jack of all trades."
ERP is a business process management tool that assists organizations in managing their data. ERP software can be used to replace or integrate various other types of business software. The following is a list of ERP's capabilities:
Accounting
Many accounting functions, such as payroll, accounts receivable/payable, and invoices, can be handled by ERP. It offers cash flow management functions to assist businesses in budgeting and forecasting expenditures through cost analysis and calculations.
Scrubbing functions ensure that tax returns are error-free and that users do not have to enter as much information. Integrating it with other software lets you import sales pipeline data, employee hours, and tax regulations.
Human Capital
Human capital can also be managed using ERP. From tax administration to HR tools, ERP simplifies employee management and onboarding. ERP also includes productivity monitoring and hiring tools, making hiring (and retaining employees easier.
Exporting employee data to the accounting module for payroll is simple. You can also use the CRM features to track sales commissions and manage performance.
Production and Distribution
Work tasks can be streamlined using the ERP manufacturing and distribution modules. ERP automates and combines production processes such as capacity planning, cost analysis, production control/synchronization, quality assurance, etc. Automating repetitive tasks gives employees more time for complex or managerial tasks.
Materials Management
ERP users can manage inventory, orders, stock, and deliveries with this one-stop solution. Managers can set and maintain revenue goals, optimize inventory processes, and keep them accountable. You can monitor hazardous material transport and receive notifications when deliveries arrive.
Sales
ERP software streamlines sales tracking and order management. ERP software enables users to automate transactions, track expenses, and track the performance of sales representatives and product performance. The ERP can also perform price/profit calculations to ensure profitability and aid in financial forecasting. The ERP can now handle customer service actions directly rather than external ticketing systems.
Supply Chain
Supply chain management can be automated and streamlined using ERP. Logistics, procurement, sourcing, demand planning, and distribution can all benefit from ERP. It also supports order management. Track materials and products from origin to the point of sale, including all intermediate steps.
Customer Service
Customer relationship management (CRM) and marketing functions can be managed using ERP. Users have access to customer accounts, contact management, pricing, tracking, email, and marketing tools. ERP can be used in both B2B and B2C businesses.
Business Intelligence
ERP software also includes some analytics and reporting features in business intelligence software. BI collects data about your company and turns it into actionable insights that can be used to make data-driven decisions. BI enables users to make more informed business decisions by providing more accurate performance reports and financial forecasts.
What exactly is Enterprise Asset Management (EAM)?
Enterprise Asset Management (EAM) is a type of enterprise asset management comprising a set of practices that optimize asset performance and reliability. This process relies heavily on asset lifecycle management, allowing for better asset health control.
EAM can play a significant role in enterprises with many expensive and complex assets, such as buildings, vehicles, heavy equipment, or heavy machinery. This is especially important in the construction, energy, space, and defense industries. These industries face high asset support and maintenance costs, which can lead to operational chaos.
Asset Lifecycle Administration
As previously stated, the asset lifecycle is an enterprise basis for structuring asset management. It is divided into several stages.
Plan
This is the most important stage of your asset utilization concept design process. Examine the assets you don't have and what they should be. Consider how they can complement and synchronize your assets as well.
Do not rush through this step. For your new project management, you must have a clear vision. This is an excellent opportunity to investigate emerging technologies, such as digital twins, which have grown in popularity recently.
You can also conduct a business digital transformation, assess your requirements, analyze current performance, and optimize business processes. Remember to include important organizational aspects such as budgeting.
Acquiring
After you've created a strategy, the next step is to buy and deliver the assets to the facility where they'll be used. This stage will include quality inspection, contract management, asset storage, spare part management, and so on.
Deployment
This stage entails assembling, installing, and initial inspection of all purchased and delivered assets. You must exercise caution and consider all aspects, including asset tracking, ownership, documentation, qualifications, support strategies, and future maintenance.
Operation
This is the point at which assets generate a return on investment. Anyone looking to increase their revenue should invest in enterprise asset management.
During this phase, EAM software will track planned and unplanned work activities. Additionally, the EAM software monitors asset health. It provides enough data to plan maintenance activities and avoid untimely failures.
Maintenance
Asset maintenance is something you cannot avoid. However, it can be managed and implemented maintenance strategies that optimize the asset and reduce downtime.
There are two types of asset maintenance: planned and unplanned.
Preventive maintenance is typically planned ahead of time. Unplanned maintenance is more disruptive because it is required when equipment fails or performs inadequately. Unplanned downtime can disrupt productivity and harm profits.
It makes sense to focus on planned maintenance or even to implement cutting-edge technologies like the Industrial Internet of Things (IIoT) or artificial intelligence (AI) to enable predictive maintenance and augment the monitoring process with real-time data about asset state.
Disposal
Asset life is a process. Companies must learn from this experience and not simply write it off.
There are two main reasons an asset could be sold:
- The asset's life span is over and cannot be used again.
- The asset is no longer suitable for your company's requirements and needs.
- It is too costly to support the asset.
- More modern technology can replace the asset.
To maximize its potential, the company must take two steps. First, evaluate the value of asset removal by analyzing asset life data (EAM software can assist you here).
EAM Software vs. EAM Practice
Enterprise asset management (EAM) is a set of practices designed to maximize asset efficiency and lifespan, reduce support costs, and improve asset quality. EAM software, on the other hand, is a tool that aids in asset management and guides you through the life cycle of each asset.
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There Are Numerous Advantages to Using Enterprise Asset Management Software
Enterprise asset management software is a piece of software that can make your life and the lives of your employees easier. Let's examine the advantages and disadvantages of EAM software implementation.
Asset Monitoring in Real Time
EAM software allows companies to track their assets in real-time. Companies can assign their physical assets and have full control of equipment no matter where it is located. This software is particularly useful for companies with high asset concentrations, where tracking every asset manually and assessing its condition can be difficult.
Access to real-time data enables more efficient asset scheduling, maintenance, and utilization. It can also assist you in detecting theft, misplacement, and asset excesses almost instantly.
Increased Operational Effectiveness
Maintenance and facility managers are dealing with major issues due to asset support delays and high costs. Process management based on spreadsheets or paperwork can result in chaos and errors.
EAM software digitizes your processes, freeing your employees from tedious and time-consuming data entry. This allows them to do their best and gives you the chance to reward your employees. EAM software makes it easy to remove bottlenecks that could hinder efficient daily operations.
Increased Asset Reliability & Uptime
Every business should strive for maximum uptime. This maximizes both output and profit. A well-planned, preventive maintenance program will extend the life of your assets and reduce the likelihood of unexpected and inconvenient breakdowns, which can halt the manufacturing process.
Data Centralization
Like many other business solutions, enterprise asset management software allows you to generate and store operational data in one location. Employees can use this software to share data with other departments. As a result, your company's collaboration and communication may improve.
Access to Detailed Analytics
Quality analytics can help you make smart business decisions. EAM solutions allow you to track the cost and stream of enterprise assets, starting when purchased to the total maintenance cost throughout their entire lifecycle.
These figures will give you an idea of the total cost of ownership (TCO). This information will enable you to optimize your investments and expenses and use detailed reports to plan for future growth.
The Primary Characteristics of Enterprise Asset Management Software
What should your EAM software have? Here are the most important functions to pay attention to.
Lifecycle Management
As previously stated, asset lifecycle management is the foundation of enterprise asset management. All stages and processes, such as planning, procurement, installation maintenance, operations, transfers, disposal, and storage, should be included in your EAM software.
A great enterprise asset management platform will assist you in tracking your enterprise assets, documents, and costs.
Work Order Administration
The work order is used to manage your company's asset maintenance requests. An EAM system can automate the creation and completion of tasks.
This feature will assist you in navigating the numerous tasks and employees. It will ensure that each process is simple and efficient and that each order is assigned to specific specialists to avoid getting lost among a slew of requests.
Inventory Management - Maintenance, Repair, and Operation
MRO Inventory is a large part of a budget and can be costly. Inventory management in EAM software can be used to track assets and parts purchased for maintenance. Inventory transparency and continuous tracking will enable you to reduce losses and prevent theft, eliminating unnecessary asset management expenses.
Management of Labor
Asset management is more valuable than any inventory or equipment you may have. Your employees are the ones who manage it. Therefore, labor management should be a key feature of enterprise asset management software.
This feature will help you manage your employees' work hours and workloads, keep track of your certifications, and schedule the required training.
Financial Management
We talked about how effective EAM software is at providing financial transparency and financial analytics. It is typically implemented through the financial management feature. This is used to analyze and calculate all financial data, such as manufacturing costs, downtime costs, emergencies, etc.
Reporting
Analytics and reporting that are accurate and thorough enable you to make informed decisions based on data, predictions, and not just assumptions. You can see your progress and the state of your equipment with charts and dashboards.
Why Should EAM Solutions Be Included in Your ERP System?
Manufacturing and supply chain companies require software that manages enterprise assets. This type of software aids in asset management optimization, asset control, preventive maintenance, and asset performance.
Whether businesses should integrate an EAM solution as a module into their ERP software or opt for a specialized enterprise-asset management software piece.
We recommend the second option. ERP integration with enterprise asset management software allows for better data streamlining and collaboration than either of these pieces individually.
These are the top benefits of integrating EAM and ERP:
- Data centralization and no duplicates are not only within the asset department but also with other units.
- More efficient processes and better collaboration across the enterprise lead to less miscommunication, tasks being delayed or stuck, and less miscommunication.
- You will have a better understanding of finances as an EAM solution. ERP will manage your company's financial costs, capitalization, and depreciation.
- Providing IT support will be easier and more cost-effective as your IT staff's efforts are directed at one system rather than being spread over many.
- It will be easier for your team to adopt the system as they will only need one system. This will reduce the time your team will spend switching between interfaces and make it easier for them to understand the process.
Integrating ERP and EAM software is critical to maximizing the value enterprise asset management can provide your business models.
What is the Importance of Enterprise Asset Management?
EAM is critical because it enables organizations to track, assess, and manage their assets while also optimizing their quality and reliability. Every organization has assets in the thousands, millions, or hundreds of thousands. They require a lot of resources.
Assets can come in many sizes: railroads, pipelines, and manufacturing equipment. They also include transportation fleets and windmills. Maintenance teams can use EAM best practices to gain more control over complex environments.
- Centralize Data on Assets: A CMMS is an asset management system that tells maintenance managers where the asset is, what it needs, who should be working on it, and when. It automates critical asset management processes while also making them auditable and accessible.
- Avoid Problems: Asset management software provides preventive capabilities that enable equipment to be maintained for continuous, stable operations. It ensures warranty compliance and prevents production disruptions.
- Make Asset Monitoring Smarter: AI-powered remote monitoring provides actionable insight into assets' current and future states. It combines data from various departments and information silos to provide more accurate alerts and improve decision-making.
- Maximize Asset Use: Historical and real-time data from IoT devices and analytical and diagnostic tools contribute to increasing the availability and reliability of physical assets.
- Manage Aging Infrastructure and Assets: To increase return on investment, implement more informed maintenance strategies and integrate risk management into business processes to extend equipment life cycles.
- Elevate Maintenance: IoT and AI improve equipment maintenance procedures. Asset tracking and traceability are critical for meeting rising safety, environmental, and health standards.
- Consolidate Operations Applications: EAM allows you to create a single technology platform to manage almost all asset types. The processes are standardized and unified for an enterprise's wide range of asset functions.
Selection Process
We have compiled a guide to help you choose the right ERP or EAM system for your company.
Collect Requirements
Because your organization is unique, you will have different software solution requirements. The interactive TEAM requirements and ERP requirements templates will assist you in determining which ERP or EAM features you use the most. This will assist you in identifying the best platforms for the required features. It's like a software dating algorithm!
Compare Products
Once your key requirements have been identified, you can compare vendors based on how their solutions meet those requirements. The performance of various ERP solutions is compared in this ERP comparison report. This EAM comparison report details which EAM solutions offer which key features. This will enable you to focus your search on the best products.
Make a Shortlist and Ask For Demos
List the top five to six solutions you found in the previous step. These options will best meet your needs. It is now time to compare the prices and interfaces of these systems. Prices for industry leaders are listed in our EAM pricing guide. Our ERP pricing guide includes pricing information for the most popular ERP Systems.
After eliminating any systems that exceed your budget, request a demo or free trial from vendors. This information can be found on all product websites and in the product directory. Without actually using the software, you can understand how intuitive and user-friendly it is.
Conclusion
Enterprise asset management software is the powerful tool that will most significantly alter asset-intensive enterprises' operational approaches. EAM systems improve asset tracking, maintenance, and supply chain management efficiency and automation.
Integrating an enterprise asset management module is wise if you want to get the most out of your ERP software.
