3 Ways Inaccurate Asset Data Costs You Money

Would you start on a trip without knowing how to get to your destination? Without checking how much gas is in the car’s tank? Without ensuring you had a credit card, traveler’s checks or at least some good ol’ cash in your pocket? 

Of course, you wouldn’t. It’s nonsensical at best, risky and dangerous at worst. So’s running your plant without reliable, correct, verified and real time data. That’s what operations and maintenance managers that rely on paper-based processes are doing. As a result, they’re increasing their chances of suffering unplanned production shutdowns, hurting efforts on reducing preventable equipment failures, and paying higher taxes and insurance premiums. 

Let’s look at three key areas of plant operations – asset monitoring, maintenance planning and decision making – and how incorrect data negatively affects each.

Industries like oil and gas, mining, chemical processing and utilities are asset intensive. It takes a lot of equipment to extract crude oil from the ground, transport it to a refinery, process it into usable form and then move the final product to market. Quite often, the oil is found far from any facilities and requires extensive pipeline networks to take it from upstream production sites to downstream refineries and processing plants. Each asset represents a significant cost to acquire. It takes more funds to maintain and keep them in usable condition. Once an asset is on the firm’s books, the company must also pay insurance to cover its potential loss. However, the organization can use the asset’s depreciating value over time to reduce taxes.

Three years ago, a reciprocating engine wore past its usable life at a hypothetical oil giant’s remote pumping station. A maintenance crew examined the engine and replaced it. Not only that, they took the engine apart and cannibalized several parts to repair other equipment. The oil company uses a paper-based asset monitoring system, one that’s filled with errors and inaccuracies. So, the tech’s paper report detailing the engine’s demise was never filed. The engine instead remained listed on headquarters’ asset ledger as a potential spare. The corporate accounting department has been paying taxes and insurance premiums for three years on a piece of equipment that no longer exists, except as a costly ghost asset on a ledger. 

The ghost engine causes more problems, this time for corporate maintenance planners. This engine still exists according to their ledger. A similar engine now threatens to go down at another pumping station in the same region. A planner decides to take needed parts from the first engine to repair the second. Only, the paper ledger is wrong. All the parts from that engine have already been used. Worse, there are no similar engines or accessible spare parts available within the company. As feared, the existing engine then fails, causing the pumping station and the pipeline to shut down for several days while a replacement is found and shipped at extra cost. All this could have been avoided had the company’s paper ledger been accurately updated in a prompt fashion. 

In this hypothetical example, inaccurate, paper-based data cost this oil company serious money in lost production, equipment replacement, taxes and insurance. It also resulted in considerable wasted time and effort. 

How? By adopting a mobile-first digital enterprise asset management system. Such a system helps users:

  • Cut error-prone paper processes.
  • Produce accurate financial statements. 
  • Identify cost-savings opportunities.
  • Respond quickly to trends or problems. 
  • Reduce wasteful duplication of effort and resources. 
  • Make calculated business decisions. 

Innovapptive, a mobile-first digital transformation provider, offers asset management solutions. These solutions enable companies to monitor assets in real time and know each’s current operational status. Executives, directors and managers receive verified, high-value data to make informed choices. Operational and financial benefits include:

  • 90% reduction in downtime and production delays.
  • 90% fewer preventable failures.
  • 20% cut in overpayment of federal, state and property taxes.
  • 15% drop in insurance premiums. 
  • 99% accuracy of fixed asset financial statements.

* Based on previous customer results. Your results may vary. 

Discover how Innovapptive’s enterprise asset management solutions can improve your monitoring, planning and decision making. Schedule a free demo today by calling 844-464-6668 or click here

 

Reducing Turnover and Managing Millennials: Survey Reveals Industrial Anxieties About The “Great Crew Change”
Are you concerned about the declining population of field operators and technicians and the generation gap between experienced workers and the...
Read More
Webinar Shows 4 Reasons Why You Should Mobilize Your Maintenance Program
Your plant is having maintenance problems. Perhaps it’s suffering too much downtime. Maybe a poor workflow limits wrench time. Paper checklists just...
Read More
Four Questions to Ask about Legacy Systems Before Starting a DIY Mobile Solution Project
In this blog, we’ll critically examine: The four common questions you need ask about legacy ERP systems before you build or buy a mobile asset...
Read More
Build vs Buy: Six hidden costs you can’t afford to overlook
Do-it-yourself projects are all the rage these days. Whether it’s building your own patio deck or a one-of-a-kind computer, people are rolling up...
Read More
3 Ways Inaccurate Asset Data Costs You Money
Would you start on a trip without knowing how to get to your destination? Without checking how much gas is in the car’s tank? Without ensuring you...
Read More
Build vs. Buy: Will Employees Use Your DIY Mobile Asset Management System?
In this blog, we’ll examine: Why companies consider building mobile asset management systems in-house instead of purchasing one from a third-party...
Read More
Webinar Shows 7 Ways Digital Inspections Cut Downtime and Hike Productivity
Unscheduled downtime is the bane of all plant operations and maintenance managers. After all, time is money. The longer a production line stays down,...
Read More
How Does Pop-Up Warehousing Work?
Pop-up warehousing has been gaining ground in recent years as more companies evaluate their distribution networks to determine the best fulfillment...
Warehouse Operations
Read More
Your Enterprise Asset Management Program Is Only as Good as Your Asset Data
An effective enterprise asset management system serves two primary purposes: Helping your company successfully achieve its operational goals and...
Read More