Fixed assets are the long-term assets used in business operations like buildings and machinery. These locked-in investments are crucial components of any large-scale organization’s balance sheet and can impact the value of the business. Therefore procuring, monitoring, and maintaining these assets is a primary concern.
Currently, many businesses manage fixed assets with highly manual asset management systems.In a survey by Bloomberg BNA, 46.8% of US-based finance executives revealed that it takes, on average, one week per month for database management and fixed asset accounting using existing spreadsheets. This highly manual process takes time away from other operations like strategic planning and analysis. But when adopting an intelligence everywhere principle and leveraging AI and sensor data, companies can automate many monitoring and maintenance processes. And the influx of real-time data will give companies valuable information that leads to better decision-making.
How AI Can Help
When utilizing AI technologies, sensor data and real-time data availability, there is an opportunity to manage fixed asset investments more efficiently and leverage the technology to achieve higher ROI. These are several areas in the asset lifecycle where AI is making an impact:
With AI infusion, enterprises can conduct market research on potential vendors and compile data on pricing, payment terms, etc., handle due diligence of vendors to ascertain credibility, digitize contracts and extract key terms and warranty information. An AI-based market intelligence platform and intelligent document processing solution can effectively automate these areas, giving companies faster intelligence and competitive advantage.
With asset accounting, AI can be very impactful in managing capitalization, depreciation, transfers and disposals of assets. With AI, businesses can digitize and process invoices efficiently and with less cost. AI systems incorporate continuous learning to identify the accounting codes that best suit every invoice and review asset transaction reports, reducing human dependencies and errors.
Cognitive automation can transform asset reconciliation when the asset is acquired and throughout the asset accounting cycle. The automation can pick up information from unstructured data, accurately reconcile thousands of invoices then compare the invoices with purchase orders, drastically reducing manual effort.
Keeping heavy equipment functioning 24/7 is essential for running a utility business or large manufacturing facility. For asset-heavy enterprises, timely inspections and preventive asset maintenance are necessary to maximize asset integrity and profitability. AI-infused asset digital inspection can analyze asset sensor data to reduce inspection cycles, expand inspection coverage, reduce inspection costs and gather data for health, safety and environmental risks.
Asset physical verification
Many organizations manage thousands of physical assets. It is necessary to know the operating condition and location, of each, at any given interval. For many companies, this process is manual. But with AI, companies can automate the entire asset physical verification process. Computer vision with airborne drones or facility cameras can take pictures of assets, capture asset details and reconcile them with a fixed asset register, saving effort, errors and time.
Cases Using AI-Infused Fixed Asset Management
An Australian Oil and Gas major was experiencing costly downtime due to asset performance interruptions. The company adopted Wipro’s InspectAI to get pre-failure warnings, promoting effective preventive maintenance for their high-value machinery. The ML-driven solution collects relevant information to predict machine failure, reduces lead time in service processing at the machine level, and identifies significant factors that affect machine failure. These improvements have helped the company increase asset uptime and productivity.
The fixed asset team within the Record to Report function at a leading technology integrator was spending time and resources analysing the fixed asset transaction report (ATR) each month. While reviewing ATR is necessary to capitalize assets and identify anomalies, this process was inefficient. The company adopted Wipro AI intelligent platform and open-source python libraries to leverage a cognitive automation solution to reduce cycle time and errors. This team uses cognitive tools for fixed asset invoice processing and accounting for these invoices.
AI-Infused Solutions are Becoming Commonplace
Manual operations management systems will continue to have degraded performance, eventually becoming ineffective for enterprises with large-scale fixed assets. In addition, real-time data collection of fixed assets and resource performance is quickly becoming imperative to stay competitive. Intelligence everywhere is the solution to modernize fixed asset maintenance and performance monitoring.
New technologies, like AI, are disrupting all aspects of a business, including asset performance management. According to IBM’s global AI study, 35% of companies are using AI; and another 42% are evaluating these solutions for their organizations. Intelligent systems can help companies drive better performance from company assets by accomplishing more with less time and resources. Soon, AI-infused solutions will no longer be a differentiator; these solutions will be imperative.