It is frequently useful to determine the total cost of ownership (meaning the total cost of owning one or more assets) and to track components of the total cost of ownership for an asset within an enterprise for accounting purposes and for making future purchasing decisions. However, tracking costs attributed to each specific asset in a large, distributed environment (an enterprise that has many facilities at differing locations, as well as one or more central headquarters) can be a difficult task.
A large retail store chain, for instance, may wish to determine the total cost of ownership for each cash register it owns. A highly distributed retail chain may have tens of thousands of cash registers, and in order to calculate a reasonably accurate determination of the total cost of ownership the retail chain must accurately track all the costs that are incurred for each cash register. The purchase price of an asset, repair costs, and maintenance costs are the main components of the total cost of ownership and so these costs need to be tracked, in some instances other factors such as energy costs may also need to be factored into the calculation.
However, tracking costs incurred in repairing and maintaining these assets can be an onerous task. In a typical procedure to service assets, a store manager first calls a service provider to perform a task on an asset. The service provider performs the task required, seeks approval for the work, and then fills out work order papers in triplicate. The work order papers are typically distributed (one copy each) to the enterprise headquarters, the store, and the service provider. The service provider then creates an invoice and sends it to the enterprise headquarters. If the accounts payable department of the enterprise headquarters can locate the work order papers, the invoice may be entered into the system and paid. If the work order papers cannot be found, the invoice may be sent to the store manager for approval, returned to the enterprise headquarters after approval, and then entered into the accounts payable system.
Tracking part and labor costs in highly distributed enterprises thus becomes very difficult using the existing process described above. Matching paperwork with assets may become exceedingly difficult due to the sheer volume of assets and the large amounts of paperwork generated in servicing and maintaining the assets.
Another potential problem with the process described above is that service providers may be able to overbill for service calls or parts without full knowledge by the enterprise of the nature of the service call. The lack of overview on a regional or national level may prevent an enterprise from determining if the costs incurred by distributed sites for an asset is reasonable.
Because it is time consuming and expensive to collect paper work from numerous sources to even have the capability of accurately calculating the total cost of ownership for an asset, the cost of ownership of many assets is frequently a guess that may vary greatly from the actual cost of ownership. Thus, enterprises frequently determine the cost of ownership for an asset to be the purchase price of the asset, which is typically considerably less than the actual cost of ownership. Moreover, in a highly distributed environment, there are many assets to manage, and current systems do not provide feasible and efficient methods and systems for managing such assets. In particular, current systems do not provide for an efficient manner to determine the costs of servicing and maintaining assets or the total cost of ownership of an asset.
A need exists for a method and system for managing enterprise assets over numerous distributed sites that is user friendly, cost and time efficient, and that may be used to accurately generate the cost of ownership for one or more assets of an enterprise. A need also exists for a common platform that may be used to set up information systems and gather accounting information for managing these assets including total cost of ownership accounting.