Importance of Asset Management in a Commercial Organization
Asset management is a program that every commercial organization undertakes to ensure that the assets and the infrastructure that it employs are properly channelized to reap maximum benefits. This program can only be used in firms whose assets are interdependent and work cohesively to achieve common goals.
The motive of investment management is to gain a clear understanding of how the quality of services, using designated ‘assets’, can be justified to make it an optimal situation for the commercial unit.
Here, optimal refers to the situation where the firm manufactures a superior quality service with minimal cost, without compromising on the quality. On the other hand, justifiability deals with presenting all the benefits and costs involved for further scrutiny. This helps in gauging the efficiency and effectiveness of the overall activity.
The goal of a Cambridge Asset Management program is to implement a workable system that monitors the three most crucial facets: namely operation, maintenance, and upgrades.
It is only when this framework is firmly and correctly in place, can an organization evaluate and understand the true nature and capabilities of all its capital assets, and make sound investment decisions subsequently.
The primary goal of Cambridge Asset Management is to help a commercial unit make planning decisions that are informative in nature. An ideal investment management system provides the framework that can generate vital information by measuring the overall performance. This information can be used internally for both short, as well as long-term planning.
In order to achieve the intended purpose of the asset management program, the system must put into place a few fundamental elements. These elements are generally an integrated database for assets, evaluation and monitoring, tools that help in economic or engineering optimization, and internal analysis of strategic investments.
These components help in establishing data accessibility, compatibility, and integrity, establishing the value of the available asset inventory, providing a means for trend indications and predictions, estimating costs and impacts, and finally allocating resources based on the risk assessment.