The construction industry has always been slow to adopt new technologies. This hesitancy has had a real impact – according to McKinsey, worker productivity in construction has only grown by 1% per year over the past few decades. That’s compared to a whopping 2.8% for the global economy and a staggering 3.6% for manufacturing.
One of the biggest bottlenecks to construction productivity? You guessed it – poor asset management.
We’re talking about expensive equipment – vehicles, tools, and materials – that get misused by workers, neglected when they need repairs, and sometimes even stolen right off the job site. This mismanagement is a triple whammy for contractors: it wastes money, delays projects, and puts workers at risk.
But fear not! In this article, we’ll show you how to overcome these common challenges and take your construction equipment asset management to the next level. The secret sauce? A well-defined management process combined with powerful construction asset management software. Let’s dive deeper into these two key ingredients.
What Is Asset Management in Construction?
Construction asset management refers to the proper management of facilities and the maintenance of the numerous assets involved in building projects. These assets might include everything from buildings and construction equipment to vehicles and computer systems.
Efficient asset management procedures can can ensure the smooth functioning of your projects at a lower cost.
Why Is Asset Management Important in Construction?
Construction asset management is essential for a variety of reasons. For starters, it gives comprehensive companies control and insight over their assets. This includes understanding each asset’s precise location, condition, and usage history. It allows you to make educated decisions about their maintenance, repair, or replacement.
If an asset breaks down or goes missing, it can cause downtime and inefficiencies. And that can hurt your bottom line. You can’t always control the circumstances, but you can prevent such errors and neglect with the help of a proper asset management program.
It’s good for your finances and helps you finish the project within deadline.
Setting up a construction asset management system might seem daunting or time-consuming. But it’s worth it!
Asset Management Challenges in the Construction Industry
Managing equipment and materials in the construction industry can feel like a never-ending battle. Here are some of the biggest headaches contractors face when it comes to asset management:
Asset Gets Stolen
According to a 2016 report by Verisk, construction equipment theft costs contractors a staggering $300 million to $1 billion annually. This vulnerability is exacerbated by the lack of standardized identification of equipment and poor record-keeping practices.
Assets Are Invisible
Even when the equipment is safe and secure, simply locating it can be a major headache. Construction projects are inherently dynamic, with equipment constantly on the move on and between sites. This fluidity often leads to misplaced assets, resulting in wasted time and unnecessary purchases of additional equipment.
Asset Break Down
Frequent equipment breakdowns are another major concern. Without a comprehensive view of asset health, maintenance history, and repair costs, managers are forced to make reactive decisions on maintenance, often leading to exorbitant spending. The inability to implement preventative maintenance strategies shortens equipment lifespan, further increasing downtime and associated costs.
Assets Lack Replacement Parts
Some equipment or their components are prone to more frequent breakdowns. Dealing with this requires keeping a stock of replacement parts. However, having insufficient data on the assets kept on site makes it more difficult to be proactive in acquiring parts. This causes delays in repairs, which leads to prolonged downtime.
Top 5 Benefits of Asset Management in Construction
Now, let’s look at the five most important advantages establishing an effective asset management program in construction.
Minimized Downtime
Proactive maintenance ensures your equipment is operational when you need it most. By diligently tracking repairs and implementing maintenance schedules, you can prevent unexpected breakdowns that can extend project timelines.
Reduced Warranty Costs
Keep a comprehensive asset inventory allows you to quickly verify the warranty status of any equipment owned by the company. This eliminates the risk of paying for repairs on equipment that is still covered by the manufacturer’s warranty.
Optimized Scheduling
Effective asset management ensures that you know exactly where all your equipment is located, who will need it next, and how long they’re likely to use it. This allows you to create data-driven deployment plans that maximize equipment utilization across various sites.
Smarter Repair or Replace Decisions
Having access to a detailed history of equipment usage, maintenance records, and repair logs will provide you with the data needed to make informed decisions about your well-worn equipment. Specifically, it will help you determine whether it would be more cost-effective to extend its life by repairing it or to replace it altogether.
Enhanced Safety
Equipment malfunctions and poorly maintained machinery can place operators and other workers at risk. By ensuring that every asset is monitored, inspected, and maintained as needed, you can create a safer environment for everyone on site.
Conclusion
An effective asset management program allows you to optimize your resources, decrease risk, and increase total production. Construction projects involve countless moving parts – it’s important to make sure that you’re keeping tabs on every single one of them.
Ready to learn more? Check out our free webinar on 5 Steps to Implementing Leading Indicators in Construction Safety!
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