Construction asset management is important for any construction company’s success and competitive advantage. This blog post is your ultimate guide to understanding and implementing effective construction asset management. From the basics to practical advice and advanced techniques, we have provided the knowledge to make the most of your property and guarantee the project’s success.

What is an asset? What is construction asset management?

Assets are valuable things owned or controlled by a company. Their value can be monetized, which means it can be sold or converted into cash. For the construction industry, assets are a key to success. Companies in this sector have a large amount of tangible assets in the form of heavy machinery equipment and skilled labour, all of which are considered to be difficult to manage.

This is where capital project managers realize the importance of managing construction assets. It provides a strong system that guarantees that assets are acquired, dealt with, controlled, and disposed of in the most efficient manner. It’s not only about inventory management but also about maximizing the ROI of these assets over the project. Construction asset management involves carefully following several key steps: 

1. Condition: Regularly monitoring the physical state of equipment to identify potential problems before they escalate into significant breakdowns.
2. Utilization: Understanding how equipment is used to optimize deployment and avoid unnecessary rentals or purchases.
3. Maintenance History: Keeping a detailed record of maintenance performed on each asset to ensure it receives the necessary care to function optimally.

Why is Asset Management in Construction Important?

Construction initiatives are complex undertakings with tight closing dates and budgets. Effective asset control is important for numerous motives: 

1. Financial savings: Imagine a scenario wherein a critical piece of the system unexpectedly breaks down during a crucial time. This results in delays and rental waste, which can considerably increase expenses. A powerful asset plan acts as a guard against such situations. 
2. Improve task efficiency: Time is precious for construction projects. Any long-term delays in project planning and budgeting may have a domino impact. Imagine a team idly watching for a misplaced device or struggling to discover a specific tool. Effective asset management eliminates such inefficiencies. By enforcing a robust tracking system, companies can ensure that the proper gadgets and tools are on-site each time they are needed.
3. Improved safety: Construction sites are inherently prone to dangers. However, regular equipment inspections and preservation, as emphasized with the aid of excellent asset management, can substantially lessen these dangers. By figuring out and addressing capability mechanical faults earlier than they occur, you can create more secure work surroundings for your team.
4. Increased Profitability:  When you integrate financial savings, accelerated asset performance, and security, the result is a clear path to extended profitability. Effective asset management reduces unnecessary expenses and ensures tasks are finished on time and within finances.

Types of Assets in Construction

Construction assets can be categorized into four main types:

1. Fixed Assets: These tangible assets will help you in production or construction for the long term. Investments made on buildings and equipment that will be used to derive the project results are all fixed assets.
2. Current Assets: Current assets are used as raw materials or small tools to derive the desired project result. In a capital project, these could be nails, lumber, etc.
3. Intangible Assets: These assets are not in the physical form but hold great value for the project’s success. For a construction company, intangible assets could be intellectual property like designs and permits.
4. Human Assets: The human resource you use to complete a project is the human asset. It includes every level of the workforce employed to achieve the desired project goals.

Benefits of Construction Asset Management

Construction asset management systems do more than just manage equipment; They provide valuable information. This data provides insight into device performance, utilization, and maintenance costs. Imagine being able to get real-time information about how your machine is performing or how often a particular tool is used.

This allows you to make informed decisions about equipment acquisition, maintenance schedule, and disposal. You can strategically invest in equipment that matches business needs, optimize maintenance practices, maximize machine life, and make informed decisions to replace obsolete or underused assets.

Asset Management Lifecycle

Construction asset management follows a lifecycle approach encompassing these key stages:

1. Planning and Procurement: This phase lays the foundation. This includes identifying the needs of your upcoming projects, establishing equipment acquisition budgets, and developing procurement strategies. Whether you’re buying new equipment, leasing specific equipment, or building on your existing inventory, this preliminary planning ensures you get the right supplies from the start.
2. Equipment Monitoring and Optimization: This section focuses on checking the equipment used to ensure proper operation. It includes tracking fuel consumption and cost analysis to assess operational efficiency. Monitoring utilization rates allows you to identify underutilized equipment and optimize its utilization across projects.
3. Maintenance and repair: Prompt maintenance maximizes asset life and prevents costly wear and tear. This phase includes implementing a preventive maintenance program, including routine inspections, repairs, and lubrication. However, preventive measures can also lead to improvement. It also deals with equipment failures and maintenance to keep your property running.
4. Retirement and Disposal: No assets are permanent. Assets become obsolete due to depreciation in their value, wear and tear loss, and the introduction of new technology. However, this doesn’t mean they will no longer generate any value. At this stage of capital asset management, you focus on how to derive the maximum value by disposing of an asset most suitably. It could be sold, recycled, or disposed of according to the asset’s condition.

Strategies for Effective Construction Asset Management

You need unique strategies to save your efforts for effective construction asset management. Here are a few tips that you can follow for better results: 

1. Utilize Asset Management Software: Automation is the best way to achieve maximum effectiveness in construction asset management. Adopting specific software or tools allows you to optimize resource tracking, scheduling, and investor management without much effort.
2. Standardize Processes: In construction asset management, adopting standard procedures for everything is extremely important to avoid confusion and possible mistakes.
3. Regular Inspections and Maintenance: Consistently regulate preventive maintenance and inspections to address all potential issues before they escalate and create a significant breakdown.
4. Training: It is important to deploy a well-thought-out training program for the workforce. It will help them understand how to handle assets while ensuring their safety and optimum utilization.
5. Optimize Asset Utilization: You should know how to study equipment usage data and identify gaps in the shape of underutilized assets. This will help you make plans to use them better.
6. Supplier Relationships: Building a solid relationship with the asset suppliers can significantly help you. With a good relationship, you can expect better service support and continuous availability of the assets.
7. Data Analytics: To make effective decisions in construction asset management, you must explore the valuable insights offered by specialized software. This data can help you better understand asset performance, utilization, maintenance, and disposition. Knowing these things can help you make timely decisions.
8. Risk Management: Proactively identify and mitigate potential equipment breakdowns and delay risks.
9. Hire a consultant: Consider seeking guidance from a construction asset management consultant for a comprehensive strategy and implementation plan.

How OnIndus Can Help in Construction Asset Management

Adopting resource management technologies and software can significantly boost the efficiency of your constitutional asset management. However, adhering to new technology and smoothly transitioning to change is never easy. You can successfully make it happen with OnIndus. Partner with OnIndus for expert asset management advisory services. We provide comprehensive solutions tailored to your capital projects, ensuring optimum efficiency and maximizing project success. Choose OnIndus to enhance your asset management strategy with innovative, effective solutions.

Conclusion

By implementing sound construction asset management, you could maximize the ROI of your assets and ensure goal achievement and competitive gain. Remember that powerful asset management is an ongoing project that calls for consistent monitoring, assessment, and adjustment. Ultimately, it will provide you complete control over how your assets are acquired, utilized, and retired optimally!

FAQs 

Q: What is asset management in construction?

Construction asset management is acquiring, processing, maintaining, and disposing of all materials utilized by a capital project manager. This includes physical property consisting of equipment, intangible assets, software program licenses, and human sources.

Q: What is building asset management?

Building asset management is an essential area in construction asset management that specializes in managing belongings related to a completed building. This includes facility control activities, preventive maintenance, and upgrades to ensure the greatest performance and value for the duration of the construction.

Q: What are assets in construction?

Construction assets include a wide range of materials required to finish the task. They can be broadly categorized into four fundamental types: intangible assets, fixed assets, current assets, and human property.

Q: What does BIM stand for in asset management?

BIM stands for Building Information Modelling. While now not a direct part of asset management, BIM may be a valuable complementary tool.