Welcome to the MyCash Dashboard Asset Capacity and Efficiency Whitepaper. From experience, organisations employing the methodology below significantly increased productivity and returned ‘lazy assets’ into cash. This may be the most impactful whitepaper to increase your cash position.
There are four elements to calculating Asset Capacity. The availability of any asset requires an assessment of the time it can be used. If a mobile asset it is determined on the combination of the time the unit could be first used (e.g. loaded) until the time it could be last used (e.g. unloaded). Even a 24/7 operation does not mean a mobile asset can be available 24/7. Necessary downtime though maintenance and an allowance for incidents (e.g. weather events in remote locations etc.) will reduce capacity. The knowledge of the capacity of any asset is the benchmark to calculating efficiency.
Capacity is the addition of:
- Employed Use
- Compensated Underemployed Use
- Non-Compensated Underemployed Us
- Unemployed Use
Employed Use
- Assets are in use and customers are paying for that use.
Compensated Underemployed Use:
- Assets are in use but idle, for example
- Vehicles are idle at loading or unloading locations and
- Payment is received from Customers.
- Buildings are rented to customers but are empty.
Compensated underemployed Use represents ‘pain’ for customers. Often these reimbursements present opportunities to work with customers to reduce their costs.
Non-Compensated Underemployed Use: for example,
- Vehicles are idle at loading or unloading locations and
- No payment is received from Customers.
- Vehicles are not loaded to capacity.
- Vehicles are not optimised to current legal limits (typically due to age of equipment).
Unemployed Use:
- Assets are idle and not earning income.
- Areas in rented premises are empty.
- Fixed Costs are an opportunity Cost.
All fixed costs of Unemployed Use assets are a financial burden.
Examples
