Asset tracking & inventory tracking are not the same
| March 2022 |.
It is essential for a company to maintain an overview of where all its assets are located, not only for the purpose of deployment in work scheduling, but also to monitor operational status. And while they may sound similar, asset tracking and inventory tracking are very different. Asset tracking involves the process of monitoring the value of physical assets owned by a company, with crucial details about each asset such as location, owner/operator, maintenance schedule, inspections, etc. Inventory tracking, on the other hand, is associated with the accurate tracking of items held in inventory for sale to customers.
Both categories have unique benefits and challenges when it comes to managing them. Below is a chart that outlines the key differences between these two systems…
How are assets and inventory tracked?
Before the development of various types of software and technology to manage assets, there was only one way to keep track of movable assets: pen and paper! Yes, it’s true… Businesses used pen and paper as an early system for asset tracking by keeping logs of their assets. They would keep track of when something was signed out, who it was released to, or when it could be returned, and more. This system quickly became a thing of the past as the invention of computers swept the world. From there, asset tracking and management became easier thanks to spreadsheets and databases replacing the traditional paper tracking system. That being said, while computers certainly helped with management, people still had to rely on counting assets and entering information into the system themselves.
Today, ERP software is still a common option as an asset management tool, with over 80% of businesses currently implementing one. While it is widely used, ERP software has the disadvantage that it is not very efficient at tracking individual items, but is instead better suited for tracking a large number of goods (i.e., store inventory that is intended to be sold).
The implementation of mobile computing revolutionized the industry once again, as these devices could now travel easily to the asset, dramatically improving the process. These rugged handheld devices – integrated computers with an attached laser scanner – operate without an internet connection and can quickly track individual items.
Today's smartphones are also playing a role in changing the industry thanks to their high-resolution cameras and the ability for workers to use an app on their smartphone to scan and contribute to the tracking system.
Pen and paper
As we mentioned earlier, the pen and paper method was the first method used for tracking business assets when no other technologies were available. Although it is the most basic method of all, some organizations still rely on it. Although it is relatively easy to track work assets using this method, it has more disadvantages than advantages as employees have to spend a lot of time searching for information about assets, which affects productivity.
Spreadsheet
While it is almost as simple as the pen and paper method, using the spreadsheet approach has some advantages, such as it being easily accessible to multiple employees and much faster to search. While it is a useful feature to have many employees access to the spreadsheet, it can also potentially cause problems, such as entering incorrect data about an asset due to too many employees filling out the spreadsheet.
Barcode
This type of technology was a huge advancement because it was very reliable and effective for tracking portable work equipment. Barcode tracking first came into commercial use in the 1970s, but it is still a very versatile tool today. Barcodes are preferred because they are cheap, fast, easy to use, accurate, and can be read by multiple types of technology. A major disadvantage is that you have to see them to scan them, which can be difficult if the barcode is not easily accessible.
Radio Frequency Identification (RFID)
RFID is based on radio frequency chips or tags that, once scanned, transmit the asset details to the scanner. Although the technology is similar to a barcode, RFID is a significantly more advanced option that offers several advantages that barcodes do not. Remote scanning, flexibility and the ability to scan multiple objects are some of the key advantages of this method compared to the barcode method. RFID is more expensive compared to barcodes, it uses a limited number of scanning devices and it also has a higher chance of user error due to a missed scan or scanning an incorrect asset.
Near-Field Communication (NFC)
NFC and RFID technology are very similar; however, NFC does not rely on specific scanning equipment to get the job done. Instead, employees can simply use their smartphones to track assets and inventory. Convenience, ease of use, and efficiency are the main advantages of this method. One drawback that should be noted, however, is that the scanning range for this method is minimal (only a few inches), so it cannot be used from a distance like some of the other methods already mentioned.
Bluetooth Low Energy (BLE)
This method is a great solution for short-range situations where the targeted moving asset remains within range of devices that can receive its signals. BLE tags are inexpensive and can offer up to 10 years of battery life, making them an attractive option if you need to track a large number of enterprise assets located within a tight grid of infrastructure.
Global Positioning System (GPS)
GPS technology makes asset tracking easy by using satellite systems that allow for triangulation of a device’s position on the Earth’s surface. Each device receives signals from the satellites, which pinpoint the precise location of an asset, similar to positioning technology for mobile phones. A major disadvantage of GPS is that it can be unreliable in various environments where there is no clear signal to multiple satellites.
Low Power, Wide Area Network (LPWAN)
Options for this type of technology provide long battery life and reliable long-range connectivity for asset trackers. Different types of technologies include narrowband IoT (NB-IoT), LTE-M, Sigfox, and LoRa [source].
LPWAN tags are more expensive than BLE tags, but they can operate without nearly as much infrastructure. For example, NB-IoT tags connect directly to the cellular network instead of needing a gateway. This technology is great for periodic check-ins; however, it is not useful for continuous connectivity for real-time tracking.
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