stand over there and don’t touch anything.” A human resource asset isn’t truly an asset until they know something and can do something that leads to a fiscal gain for the company.
To truly reflect the value of people as assets, a human asset, there needs to be a comprehensive training and development program built around the person and the position. For example, Figure 1-2 might reflect the different roles of a maintenance planner/scheduler in your organization.
Figure 1-2 Roles of a Planner/Scheduler
If Figure 1-2 reflects the roles that a planner/scheduler might fill at your facility, there should be an objective-based training protocol for each. Take, as an example, what a training matrix might look like for the planner/scheduler for the role of PM/PdM (Preventive Maintenance/Predictive Maintenance) overseer. Figure 1-3 is an example of this matrix.
Figure 1-3 shows the start of a training matrix for the planner/scheduler. The first few columns of this particular matrix are meant to show some skills that are necessary for the planner/scheduler’s role as the overseer of the PM/PdM program. Note that the legend for how to read this matrix is in the upper left-hand corner.
Figure 1-3 A training matrix for the Planner/Scheduler role of PM/PdM overseer
Adapted with permission by Marshall Institute, Inc.
To demonstrate the lengths to which your organization will ensure that a human resource is actually an asset (contributing to the fiscal benefit), in Table 1-3 indicate a single individual’s first name (in your company), one role they fulfill, and two skills they are required to have as part of their transformation into a greater asset for the company.
Table 1-3 Increasing the Value of an Associate Adapted with permission by Marshall Institute, Inc.
Adapted with permission by Marshall Institute, Inc.
Just to recap, for human resource assets to truly be assets, they need to know how to do something that contributes to the fiscal prosperity of the company.
Financial Assets
Financial assets might be the easiest and most relatable concept for us as individuals to comprehend. Why? Because we have so much personal history with this type of asset. Financial assets are the answer to, “How much money do you have, and what are your investments and your level of liquidity?”
I personally have four bank accounts, two business checking accounts, one personal checking, and one personal savings account. Years ago, I was in the bank transferring some money between accounts and getting some cash and the teller asked me a strikingly personal question. “Mr. Ross,” she said, “why do you have four bank accounts?” I responded that I needed four accounts because the bank only insured each account up to $250,000. She looked amazed and asked quite sincerely, “You have one and a half million dollars in our bank?” I did not correct her math, but I did ask her to count back my cash, twice!
The financial assets are basically the portfolio that is the cumulative accounting (pun intended) of all your money and investments. I won’t ask you to list your financial portfolio. But, understand that businesses depend on cash flow. Companies don’t like to, nor do they want to sit on large sums of cash; however, they need to have some level of cash reserves. The financial assets are often tied up in capital assets, and investments into other businesses.
Property Assets
I’ve done a considerable amount of facilities consulting in which the client is not a manufacturing operation, but rather a service or information organization. Not unlike your own location, their property asset value is dependent on the ‘real’ property that they own. It would not be unusual for companies to lease space rather than own it outright, or buy on terms.
Sometimes, and very interestingly, a property asset can become a liability. This can occur when the property the organization owns becomes unusable, dangerous, or just not desirable. Think of a location that is a superfund cleanup site. This would clearly be a liability for a company.
For property to continue to be an asset, it has to be cared for in such a manner that it maintains its value for service. It would not be beyond the pale for the land to be more valuable than any buildings that sit on it.
This might be urban legend, but in an interview, Ray Kroc (McDonald’s) was asked how he felt about being the hamburger king of America. He corrected the interviewer to say that he wasn’t the hamburger king, but he was the real estate king of the United States. He owned all the land under all the McDonald’s restaurants.
Trade Secrets and Proprietary Assets
The intellectual property of your company has a real value. Imagine the trade secrets and secret recipes that have built the enterprise that now employs you. Patents and trademarks have a shelf life, and companies work quickly to capitalize on the market and make a buck.
Trade secrets transcend the discussion of assets and work their way into the maintenance and safety realm through OSHA’s 29 CFR 1910.119, Process Safety Management. Trade secrets are one of the fourteen elements listed and explained in this federal regulation.
Not necessarily a trade secret, but as an interesting aside, I was awarded a patent in 2018 after having submitted the paperwork eight years prior. Look it up, patent #9,636,832; apparatus and method for spirally slicing meat. I made exactly one dollar off of it. It might be time to open a fifth bank account!
Inventory
Now we’re talking! Inventory can be a tremendously valuable asset, but it can also be a heartbreaking liability.
There are five major inventory categories in most operations:
1. Principal supplies
2. Work in Progress (WIP)
3. Finished goods
4. MRO (Maintenance Repair Operations or spare parts)
5. Office supplies
Principal supplies are the raw materials that we use to make, package, and ship our product. Work in Progress is self-evident and is literally the work that is on the floor in the process of being ‘made.’ Finished goods are the products that are packaged, and ready to go to the customer. MRO are the spare machinery parts. It may be that your company includes consumables in this category as well. Office supplies are the actual administrative supplies needed to keep the office and staff functions running.
The most highly coveted and most secure inventory is without a doubt the office supplies. If you need a box of staples, you usually have to see “Marge” up front and she will ask what you need an entire box of staples for. She will most likely give you one sleeve of staples and snap that one in half in front of you.
That might have been said in jest, but keep this in mind. Of all these types of inventory, the right
