Asset management in manufacturing refers to the process of strategically placing systems to maximise overall productivity in manufacturing. This goes beyond simply tracking machines on a spreadsheet. It is about protecting the equipment that keeps your production line alive.
For small and medium manufacturers in South Africa, having strong asset management systems can make a huge difference by moving your business from constant crisis to stable growth. As an SME, there’s no use investing in machinery without investing in managing those assets. When your business is in peak season, you should prepare for emergencies where your critical machinery might potentially fail.
Asset management allows you to avoid a situation where your business suffers due to dissatisfied customers and clients, a damaged reputation, and the cost of trying to repair and recover whatever the business would have lost.
The Importance of Asset Management
In manufacturing, assets are the essential equipment that help your business run. This can include presses, moulding machines, conveyors, refrigeration units, delivery vehicles, and even software systems. Each one has a life cycle. Each one depreciates. Each one can either generate profit or drain it.
Strong manufacturing asset management helps you:
- Reduce unplanned downtime.
- Extend equipment lifespan.
- Improve production planning.
- Lower maintenance costs
- Increase return on investment.
Don’t focus too much on buying better machines. The real advantage often lies in managing existing assets better. That is where operational discipline separates struggling plants from profitable ones. To ensure you manage your assets effectively, you need to establish best practices suitable for your business.
1. Build a Clear Asset Register
If you cannot see it, you cannot manage it. Start with a complete asset register. This should include:
- Asset description.
- Serial number.
- Location.
- Purchase date.
- Supplier details.
- Warranty status.
- Maintenance history.
- Current condition.
It’s important not to overlook this step. The last thing you want is to have machines moved between departments and parts replaced without documentation. Over time, no one knows the true age or performance history of key equipment.
Digitising your asset register allows you to ensure you’ve stored the data, which is far more effective than paper files. Asset management software for manufacturing SMEs is now affordable and easier to implement. Cloud-based systems allow managers to access real-time data without complex infrastructure.
You might think your machines are old and start panicking to buy new ones. However, when you create a register, you might realise that some are poorly maintained, not old.
2. Preventive Over Reactive Maintenance
Reactive maintenance is expensive. Do not wait for breakdowns, as that is a gamble. Preventive maintenance in manufacturing involves scheduled servicing before failure occurs. This includes machinery lubrication, calibration, cleaning, and component replacement based on time or usage hours.
You can predict problems in machinery when you track failure frequency, vibration changes, temperature fluctuations, and operator feedback, you begin to predict problems. Predictive maintenance strategies, even at a small scale, can dramatically reduce downtime.
You do not need advanced sensors from the get-go. Start by logging simple data consistently. Over a set period, say six months, trends will appear, allowing you to identify problems.
3. Connect Asset Management to Production Planning
Asset management should not operate in isolation. It must link directly to production schedules.
For example, if you know a machine requires servicing every 800 operating hours, plan that service during low-demand periods. Do not wait until it fails during peak season.
Advanced manufacturers align their asset maintenance calendar with sales forecasts. Even SMEs can do this with basic planning discipline.
The hidden advantage here is client trust. When you avoid unexpected shutdowns, you deliver on time. In manufacturing, reliability often wins more contracts than price.
4. Measure Overall Equipment Effectiveness
Overall Equipment Effectiveness, known as OEE, is one of the most powerful performance indicators in manufacturing asset management.
OEE measures three factors:
- Availability
- Performance
- Quality
Tracking OEE highlights invisible losses. A two percent efficiency gain may look small, but over a year it can translate into significant revenue.
5. Standardise Operating Procedures
Standard operating procedures reduce human error. They ensure consistent machine setup, cleaning, and shutdown processes.
Ensure you document the following as part of asset management processes:
- Start-up steps.
- Calibration processes.
- Cleaning routines.
- Emergency procedures.
Training new staff becomes easier. Mistakes are reduced, and asset lifespan increases.
It’s important that essential knowledge doesn’t sit in the head of one experienced technician. When that person leaves, there’s a risk of performance dropping. Documentation protects your business from that risk.
6. Use Life Cycle Costing for Smart Investment Decisions
When considering new equipment, many businesses focus on purchase price. That is a mistake.
Life cycle cost includes:
- Installation.
- Energy consumption.
- Maintenance.
- Spare parts.
- Downtime risk.
- Disposal.
A cheaper machine may cost more over ten years. Manufacturing cost control improves when decisions consider the full asset life cycle. This approach helps SMEs avoid capital waste.
7. Strengthen Spare Parts Management
Some machines may go idle due to just one missing part. Spare parts inventory management is a silent driver of uptime. It’s safer to ensure critical components are always available. Non-critical parts can be ordered on demand.
Simplify your process by ensuring the following:
- Track supplier lead times.
- Build relationships with reliable vendors.
The key is balance. Overstocking ties up cash. If you understock, it risks production delays. Data from maintenance logs helps you determine optimal stock levels.
8. Invest in Energy Monitoring
Energy is one of the highest operating costs in manufacturing. Many factory owners do not realise that inefficient machines consume more electricity long before they fail. Monitoring energy usage per machine can reveal underperforming assets.
Energy-efficient manufacturing practices reduce cost and extend equipment life. Sometimes a simple motor replacement can cut consumption significantly. This is an area where small improvements create long-term savings.
9. Conduct Regular Asset Audits
An annual asset audit should verify:
- Physical condition.
- Depreciation accuracy.
- Compliance requirements.
- Safety standards.
Audits are not just for accountants. They protect operational integrity. During one audit, a company discovered that safety guards had been removed from a machine years earlier. The risk exposure was severe. Regular reviews prevent such blind spots.
