When your asset inventory control methods are out of date, disorganization, poor security, lost or stolen assets, tax code violations, compliance fines, and other issues can occur. Switching to the right technology to control asset inventory can help improve business practices and your bottom line.
Here are some of the common problems that occur when an organization is using out of date asset inventory control processes:
Even the most diligent book-keeper with an in-depth knowledge of basic procedures is not immune to human error. Human error can lead to issues with compliance, lost assets and inaccurate records. An asset inventory control system that utilizes RFID and barcode technology will update your asset inventory in real-time and help you find and track assets.
You’ve Got Ghost Assets
Ghost assets are fixed assets that are either missing or have become unusable over time. These types of assets can lead to higher personal property taxes and insurance bills, as well as an inaccurate assessment of enterprise value. If you’ve got ghost assets, you need to be aware of how they are affecting your bottom line.
Lack of paper trail
Keeping track of purchase order info, planned maintenance activities, and the details of the service performed on pen and paper and stored in a file box is problematic when an audit needs to take place. A modern asset inventory control system would be automated and paperless, making it easy to track all asset information from a digital database, generating reports and viewing an assets complete history with a click of a button becomes possible.
If your industry is regulated by federal agencies that develop standard rules and guidelines, minimizing risk and maintaining performance levels are critical. Organizations under regulatory oversight are faced with constantly changing rules and strict penalties for non-compliance, including hefty fines and the potential loss of valuable government contracts.
In order to meet mandated minimum safety levels, assets must undergo inspection to ensure regulations are met. Inspections may be an ongoing task and regulating agencies may conduct periodic audits without notice. Poor documentation regarding inventory control can have serious consequences. Asset tracking software that sends notifications when an asset doesn’t comply with the required standards so that action can be taken will not only will this minimize fines, but enhance safety.
Cannot keep track of asset allocation
Asset tracking enables inventory managers to assign inventory to specific projects. With a click of a button, employees can pull up information from the database on any asset and clearly see that the asset has been allocated elsewhere. Without an organized asset tracking system, employees cannot easily keep track of asset allocation information which may result in them trying to put last minute plans in place for asset allocation, resulting in chaos and schedule disruptions across the company.