Surplus asset identification is broader and more inclusive than most would consider. Surplus asset identification involves:
- Identifying the sources of information on existing and future surplus;
- Identifying the physical location of the surplus;
- Developing an inventory and cataloging protocol;
- Recording the cataloged data in a database to facilitate reuse or sale.
Why Surplus Asset Identification is Important:
So, in a very significant way, the market value of a company’s surplus assets (for redeployment or sale) depends upon the complete and easily accessible descriptions of those assets. Collecting the necessary asset detail and specifications requires the IR specialists, or their contractors, to be thorough in obtaining complete information. Providing complete details and descriptions, including photos, reduces the risk to potential internal users and outside buyers. Reducing risk increases the opportunity for reuse and increases the market value of the asset to be sold.
- Business and production groups or units are the top sources of surplus. The majority of capital assets are employed in the manufacture and movement of your company’s products. Studies of all industries indicate that at any one point in time, from 2 percent to 10 percent of companies’ assets are surplus to their needs.
- The engineering group should provide a ready source of information on forthcoming construction, equipment upgrades, expansions, and process changes.
- The maintenance group is a primary source for surplus equipment information.
- Warehousing and stores personnel are vital in identifying parts that are no longer used on the equipment. Safety and environmental groups deal with ever-changing regulations and constantly strive to upgrade working conditions.
- The internal auditing group can also be a great source of information.
- The IT department continually creates surplus through equipment upgrades.
The process of cataloging surplus assets that are being inventoried should begin with an inventory plan. The asset plan should begin by:
- Identifying and obtaining whatever records exist. These can be accounting records, plant operating and maintenance records, diagrams and drawings or operating manuals.
- Preparing a standardized naming and descriptive protocol through the use of templates (see example below). Where possible, developing templates that contain the descriptive data fields for frequently appearing assets will not only speed the cataloging process but provide more complete and consistent information.
- Prepare for exceptions. It may be impractical to prepare a specific template for every type of asset that you will be dealing with, so some assets will be described simply by using what general characteristics are available to a major noun, secondary noun, manufacturer, size, etc. Knowing and accurately communicating the condition of the assets cataloged is critical to any redeployment effort.