Why you Need to Ramp Up Your Asset Management & Maintenance During a Recession

Companies in any sector may face challenges during an economic downturn, commonly referred to as a recession. During a recession, companies must make difficult choices in order to reduce costs, increase efficiency, and yet provide their customers with high-quality goods and services. 

Recession cycles are unexpected, thus companies should always be ready for such challenging times. It is important that the usual business scenario runs smoothly even during recessions. Because it is difficult to invest in operations during a recession, most companies make the mistake of lowering their asset management. However, if you take a close look, you may not need to reduce your asset management, instead be prepared for it and invest in a long term plan to reduce your costs. 

In the facility management sector, the requirement for efficient asset management is even more pressing during a recession. In this article, we'll examine how facility management may be impacted by a recession and why asset management should receive a lot of attention at this time.

Recession's Effects on the Facility Management Industry

Companies in all industries experience significant financial restraints during a recession. These limitations lead to budget cuts, downsizing, and reduced income sources. Facility management companies are not an exception. As companies experience a decline in demand for their services, they reduce non-core expenses. Additionally, it might become more challenging to keep up with necessary maintenance and repairs as the cost of maintaining facilities may rise. Let's look at how facility management industry gets affected by recession:

1. Budget reductions: During a recession, companies might decrease their spending on asset management and other facilities management services. This might lead to fewer maintenance tasks being completed, which could shorten the lifespan of an asset and leading it to breakdown. 

2. Delay in Maintenance: In order to save costs, companies may decide to put off maintenance tasks during a recession. Delaying maintenance might result in higher long-term costs since more extensive repairs or asset replacement may be necessary.

3. Decline in Investment in New Assets: Companies may postpone or avoid investing in new assets during a recession, which may have an impact on asset management activities. Asset managers might be required to focus on keeping existing assets operational for longer periods of time because there will be fewer new assets to manage. 

4. Reduced Demand: As companies reduce their operations during a recession, demand for facilities management services may decline. The asset management industry may also be impacted by this, which would lead to a drop in the demand for asset management services.

Why Asset Management is more crucial than ever during a Recession

Given the difficulties companies face during a recession, it is important to give asset management more attention. Facility management teams have to determine new ways to reduce costs without compromising on service quality. An efficient asset management plan may boost productivity, cut expenses, and help companies in adhering to health and safety regulations. The following points will justifies why asset management is essential:

1. Cost reduction: In order to survive a recession, companies have to cut down expenses and optimize their operations. Asset management helps in identifying of redundant or underutilised assets that can be repurposed or removed to reduce costs.

2. Maintenance and Repairs: Effective asset management guarantees on-time maintenance and repair work, reducing the likelihood of costly breakdowns or equipment failures that could disrupt operations.

3. Sustainability: By making informed decisions regarding the investments and upgrades necessary for long-term growth, asset management assists organisations in ensuring the longevity and sustainability of their operations.

Finding your way through these challenging times

Asset management becomes more important during a recession. Here are some suggestions that will help you get through these difficult times.

Prioritize Essential Maintenance

To thrive, companies should focus on their core operations. On the other hand, essential maintenance shouldn't be overlooked. For facilities to run properly and efficiently, preventive and predictive maintenance is essential which saves you from costly repairs and breakdown. It is important to prioritize maintenance activities based on the criticality of the assets.

Establish a long-term asset management strategy

Facilities must be well-maintained and critical assets must not be neglected, which calls for a well-designed asset management strategy. The full asset life cycle, from acquisition to disposal, should be covered in the plan. A long-term asset management strategy ensures that resources are used effectively and that maintenance tasks are well-planned and executed.

Leverage Technology

Costs can be minimised and asset management procedures can be made more efficient with technology. To manage work orders, keep track of asset maintenance schedules, and give real-time visibility into asset performance, employ asset performance management software. Predictive maintenance technology also helps in the early detection of potential problems minimising downtime and repair costs.

Enhance Energy Management

For organisations, energy expenditures are often a significant expense. It is important to cut costs wherever possible during a recession. Utilising energy-efficient technologies, minimising energy waste, and keeping an eye on energy usage can all improve energy management. Real-time monitoring helps in collecting data on energy further recognising areas and patterns where energy consumption can be reduced. This helps the organisation achieve its sustainability objectives by cutting expenses and reducing carbon emissions.

Employee Engagement

For facility management to succeed, employee involvement is crucial. During a recession, employees may worry about their job security, which may lead to disengagement. Employee involvement in facility management tasks can promote a sense of pride and ownership in the workplace. Increased productivity, decreased absenteeism, and higher morale can all result from this.

In conclusion, there is an increased need for asset management during a recession, as it helps companies to manage their assets more efficiently and sustainably. Asset management helps companies in cutting costs, guaranteeing prompt maintenance and repairs, and assisting in the decision-making process for investments and upgrades that are essential for long-term development and sustainability. In order to maximise operations and sustain the business through difficult economic times, companies must prioritise asset management during a recession.