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Satish Pendse
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Visibility of equipment across organisation helps in optimal allocation of equipment across projects, writes Satish Pendse

Construction industry is a capital intensive industry, and high-value fixed assets form a major part of the capital for the business. For real estate business, land, facilities and equipment for facilities management are the critical fixed assets; whereas for infrastructure construction business, plant and construction equipment are the critical assets. Information Technology (IT) can play a very useful role in the effective management of all these assets. In this particular article we will discuss how IT can be used for effectively managing the asset class – construction equipment.

Equipment management

With the phenomenal growth in the construction activities over last decade in India, construction companies are working on concurrent projects of large volumes and increased complexities at diverse geographical locations. For being competitive, companies are working on various strategies to reduce the project time-cycle while improving the profitability. This makes the construction equipment as one of the most critical resources in a construction project. Non-availability, delay, breakdown or sub-optimal performance of equipments can prove to be costly and disruptive for the project.

The main challenge in effective equipment management is the absence of linkages between the stakeholders such as procurement, equipment department, accounts and project teams. Also, lack of visibility on information related to equipments such as availability, productivity, POL consumption across projects hampers the optimal utilisation of equipments. With the help of IT the above mentioned challenges can be effectively handled. Further, most of the times the use of information gathered from equipment is restricted to the post-event (breakdown / delay / low productivity) analysis; however this information can be effectively used to avoid these events in the first place using IT.

Managing information of equipment can also prove to be of immense help to the estimators during tendering process or the planning department during the project planning phase. When an estimator is working on a tender, it is very important to have an idea of availability of right kind of equipment. Visibility on whether existing equipment can be transferred or new equipment needs to be hired or purchased, can go a long way in making an accurate and competitive estimate for a bid. Even during project planning phase, details to the extent of type of available model of the equipment, fuel consumption, equipment output, etc. can help in selecting the right equipment, which can be a substantial contributor to the profitability of project.

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COMMENT   Sir, the article is excellent but i want to know that which module of SAP can help over tracking/Handling the Equipments   3 Comments Read more comments »

Optimum utilisation of equipment

Equipment utilisation can be viewed at in two ways – utilisation of equipment across organisation and utilisation across a project.

Visibility of equipment across organisation helps in optimal allocation of equipment across projects. For example, a project in need of additional excavators can be provided with the same from other project sites which have the surplus of the same, provided it is the optimal solution. Or a crushing plant with higher capacity for its current project can cater to nearby project sites as well if it is feasible and most economical solution. A world-class ERP like SAP provides visibility of the equipment across organisation in terms of availability and utilisation for the assigned project, which can be very helpful in the decision making for situations mentioned in above examples.

On project level, we can get information for particular equipment about various parameters such as working time, idle time, productive time, non-productive time and the overall utilisation of the equipment. Based on this information, corrective measures can be taken for optimising utilisation.