Published: March 03, 2025  Updated: March 03, 2025

Maximizing Asset Life Through Effective Asset Management

Maintenance department personnel strive to keep assets operating at peak performance. Throughout the years, though, that "peak" baseline drops due to age, usage, and repeated repairs.

In this article, we'll examine these and other factors so you have an overview of asset life, one of the important parts of successful asset management. We'll also look at the benefits of a computerized maintenance management system (CMMS).

Understanding Asset Life in Asset Management

What factors do you need to be aware of when deciding whether to continue servicing a particular asset or replacing it?

Manufacturer's Guidelines and Asset Life

Ask The Manufacturer

They built the machine/equipment/vehicle/etc. They will have specifications and the results of numerous tests.

Be aware that while the manufacturer may provide a lot of information, you're receiving estimates. As an example, use a doctor. That health provider can't specify how long an individual lives. They estimate based on factors such as diet, exercise, and genetics.

Similarly, you might not receive a specific answer in terms like: The processor will last fifteen years.

That doesn't show accuracy. What if there was a glitch, and the machine lasted seven years because of constant breakdowns?

What if you overuse the machine? It can't survive for fifteen years. What if you devote extra time and care and the processor last twenty-five years?

What they'll give you are estimates, such as cycles and hours of operation.

This information gives you a good start. Use those estimates as a guideline for your particular operational needs.

Maintenance History and Asset Performance

Ask The Maintenance Technicians

Whenever you conduct preventive maintenance or execute a repair, you should document the work. Having a history of maintenance gives you a record to consult to help you in the decision of whether and when to purchase new.

• Quality review. Spot-checking the work.
• History of technician (s). Do you assign maintenance to one person? How is that a factor?
• The frequency of PMs.
• The number of repair jobs during the previous six months/year/etc.

You look for the answer(s) to the question of when maintenance costs exceed the value of the equipment.

Discover how streamlined maintenance processes can elevate production. Learn more.

Depreciation and Asset Life Cycle

Depreciation

This also helps answer the previous questions. A number of ways to tabulate depreciation values exist. You choose the one relevant to your company. Note that depreciation until you reach that gray line where you should start thinking about replacement.

For further details on calculating depreciation, see the article at Investopedia.

Adapting to Technology Changes

Current Technology

Are you constantly upgrading software for the machine? Are you making other adjustments to keep up with current technology? Will your equipment even accept current upgrades or adjustments?

Real-World Examples of Asset Life Assessment

Let's use the above factors in real-world examples.

Manufacturer's Specifications/Guidelines in Automotive Industry

In the automotive industry, car manufacturers provide specifications and guidelines for determining the life of various vehicle components. For example, the recommended service intervals for:

• Engine oil changes.
• Tire rotations.
• Brake pad replacements.

By adhering to these recommendations, vehicle owners can prolong the life of their vehicles. These guidelines help maintain their performance and safety standards.

Past Maintenance History in the Aviation Industry

In aviation, determining the life of an aircraft component often involves analyzing its past maintenance history. For instance, you could determine an aircraft engine's life expectancy based on the number of flight hours it has operated and the maintenance records detailing any repairs or replacements. By tracking maintenance activities over time, airlines can anticipate the need for replacement or overhauled parts.

Depreciation in the Manufacturing Industry

A manufacturing plant relies on heavy machinery. The company may use depreciation to determine the asset life of these machines.

For example: You expect a piece of equipment to last 10 years. At the outset, you purchased the machine for $100,000. The company might depreciate it at a rate of $10,000 per year. At the end of 10 years, the asset's book value equals $0. This method helps the company assess the remaining value and lifespan of its machinery.

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How a CMMS Optimizes Asset Management and Extends Asset Life

Review the above aspects and realize how a CMMS covers, monitors, and tracks all of them.

List of Assets

CMMS software acts as a database for all your assets. You create the list and add as many details as you want.

List of PMs

Again, you create your list of PMs and assign them to the assets. In the CMMS, these assets, inventory, and PMs cross-reference each other.

You create the specific PMs with priorities, type, and work details, and add in the frequency.

Equipment Readings

Document PSI, depth, hours in operation, temperature, and an array of readings for each asset. These help you shape your PM program. They become part of the maintenance history.

Maintenance History

Generate reports on works orders for an asset over a specified date range.

Manufacturer's Guidelines

Document these within your asset records. Note safety protocols to attach to work orders.

Depreciation

After you set up the type of depreciation you want for your assets, the CMMS automatically documents the value.

Expenses

The CMMS keeps a history of input expenses. Cost of asset. Cost of parts and supplies to maintain assets. Labor costs. Time spent in maintenance jobs.

Use all of these to determine the best time to invest in a new or replacement asset.

Enhance Asset Life with Smart Asset Management

Companies want their asset investments to last. Maintenance and management use several factors to determine the value of each asset throughout the years.

Using a CMMS brings better organization and better oversight over each asset. With help from the provider, you can integrate the software with other systems. This way, you transfer the CMMS information to other programs to better help you make decisions.

Your successful asset management starts with MAPCON, the finest CMMS for your business. Get on the path of overseeing your assets with a call to 800-922-4336. You work hard. MAPCON helps you work smarter.

 

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