In construction management, your assets are indispensable. After all, you can’t efficiently clear a site without a bulldozer, you can’t quickly slice wood without a circular saw, and you can’t easily share documents and pictures with stakeholders without computers.
Assets make a project possible, and if you don’t manage those assets properly, you risk running into problems that could set your project back or wipe out your profit margins. As anyone in construction project management knows, that happens all the time — and it’s never a good feeling.
If you’ve ever been frustrated by a backhoe that wasn’t available when your team needed it, or an over-expenditure on tools you ultimately didn’t need, it’s time to get a handle on asset management. This guide will help you understand what this process involves and what strategies will make it work for you.
Overview: What is construction asset management?
Construction asset management refers to the process of keeping track of equipment, vehicles, computers, and facilities on a job site. It's a subset of construction resource management, which includes all resources used by a construction firm and not just assets.
Because assets are the driving force behind the activities on a job site, construction managers must manage them efficiently in order to eliminate waste and make sure workers have access to the right assets at the right time. This will prevent cost increases and delays to the construction schedule.
Types of assets in construction
Construction assets come in many shapes and sizes, but generally they have one thing in common: They’re a non-consumable object necessary for the completion of your project.
1. Construction equipment
Construction equipment represents the high-dollar assets companies use to do the heavy work on a job site such as cranes, bulldozers, excavators, backhoes, trenchers, pavers, and a host of other specialized equipment depending on what kind of construction work is being done.
The size, value, and fuel usage of these assets makes them particularly important to manage.
While you might be tempted to lump all wheeled assets in with construction equipment, you should keep vehicles such as cars and trucks separate, particularly if they are used off the job site for running errands or general transportation.
Once a rare sight in construction, computers are ubiquitous on today's job sites. Whether you're talking about office computers, tablets, or even mobile phones and wearable electronics, computers should be managed carefully due not only to their value and importance but because of cyber security concerns.
You may be tempted to skip monitoring every hammer or screwdriver in your arsenal, but if a worker needs a tool to complete a project and has to go looking for it, that's costing you valuable work hours over the life of a project.
By keeping an accurate tool inventory and tracking their usage, you can make sure your workers have everything they need at the right time. Also, some specialized tools are expensive and insured and should be tracked for that reason alone.
Every job site has small facilities to help workers do their jobs such as trailers, portable toilets, and washing stations. These are also assets and should be tracked as part of your asset management plan.
5 asset management strategies for construction companies
When it comes to managing these resources to maximize efficiency, these five strategies are critical.
1. Use software
Asset management gets complicated fast, and considering how important it is to your bottom line, you must use specialized software rather than rely on spreadsheets.
Today's construction management software uses GPS equipment tracking to tell you where each asset is, allows workers to clock them in and out, and does many other tasks that would just be too much for a manager to manually track.
Free asset tracking software exists, although you will have to do without the more advanced tools.
Tip: The Blueprint has reviewed the top construction management software and equipment tracker options. Check out a few of them to see how they manage assets and determine if they fit your business.
2. Track the life of your assets
Assets create an additional challenge that labor, materials, and other resources do not, and you need to track their lifespans and plan accordingly. Assets are only useful for a certain time frame, and that lifespan differs greatly depending on the type of asset and how gently they’re used.
By accurately predicting asset life, you will figure out when new equipment will be necessary. This will help to avoid lag time between when equipment breaks down and when you get a replacement. It can also prevent safety incidents caused by aging equipment.
Tip: Factor in total life-cycle costs in addition to the purchase price. Determine how much fuel the asset will use, how much you'll spend monthly on maintenance, and anything else you can think of.
3. Make someone accountable for the asset
By making an individual responsible for the maintenance and usage of the asset, you'll make it easier to track.
If you have a team of three workers that uses a backhoe regularly, for example, assign the most senior worker the responsibility of checking fuel levels, keeping up with the maintenance schedule, and logging hours. Create a manual on how to do that, or provide access to your software to help them do that.
Tip: Set up a regular accountability schedule with the designated individual. Make it clear what information you want them to show you, such as usage logs and maintenance events. Follow up and meet with that individual on the assigned dates to make sure they’re tracking equipment and other assets as agreed.
4. Review assets regularly
As the construction manager, the buck stops with you. Now that you've assigned people to track your assets and you've drafted a plan that takes lifespan into account, you should review your assets on a regular basis to determine that they’re being maintained and they’re depreciating at the rate you expected.
If you find irregularities, figure out why and whether you need to make changes — either to your process or to your expectations.
Tip: Create a checklist to increase the efficiency of your review. Set aside a couple of hours every few weeks or so to go through that checklist at the job site. Allot some extra time for meetings with the equipment managers should you come across irregularities.
5. Make adjustments
If you're closely tracking assets and regularly reviewing them, you will notice some things that need changing. Perhaps equipment is declining at a faster rate than expected, and there's nothing you can do except adjust your expectations in your next project plan.
Perhaps equipment is being misplaced too frequently, and you need a software platform that does a better job of tracking. Either way, regularly make adjustments and tweak your operations to improve your asset management.
Tip: Set aside a quarterly meeting to talk over the asset management plan with stakeholders and brainstorm ways to improve it.
Software will give you asset management ideas
A good way to figure out how to manage more effectively is to see how today's software does it. Give a few construction software options a try and evaluate their asset management tools. See how their equipment tracking system works in monitoring equipment asset resources.
Evaluate your own processes to identify the differences in your approaches, and settle on the methods that work best for you and your business.