Tool tracking refers to the process of monitoring and managing the location and usage of tools and equipment within an organization. This process is critical to the success of any company that utilizes any kind of tools, as it provides valuable data that can be used to optimize productivity, reduce costs, improve safety, and enhance accountability. But what exactly is the presence and power of tool tracking in the professional world today? And what does that say about how companies are – and aren’t – addressing their most common problems? These six statistics about tool tracking might have the answers.
1 in 3 Businesses Do Not Track Their Tools
Despite the high cost of tool loss, many businesses simply don’t bother to track their tools. This could be due to a lack of awareness of the importance of tool tracking or even the simple belief that it's not worth the time and effort. Truly, there are countless reasons businesses might choose to not track their tools, including:
- Perception that tool tracking is expensive
- Lack of understanding how to use these technologies
- Fear of change and reluctance to adopt new technology
- Misconception that tool tracking is time-consuming
- Belief that implementing tool tracking is someone else's job
- Fear of pushback from team members
- Perceived difficulty in maintaining a tool tracking system
While all of these are valid concerns on a surface level, many are simply misguided or overstated. For instance, tool tracking doesn’t have to be expensive, time-consuming, or overly complex – there is tool and equipment software out there that is deliberately designed to be simpler, faster, and more affordable. It’s also worth noting that the risks of not tracking tools can be far more significant than these concerns, including increased tool loss and spending, decreased productivity, and even safety hazards.
To take the matter further, these numbers are also incomplete and, in a way, misguiding on their own. If 1 in 3 businesses do not employ tool tracking, then 2 in 3 businesses do. That means most companies understand and utilize the benefits of a tool tracking system, right? Not necessarily. Of that remaining 66.7%, businesses might be using manual tracking or other outdated methods. While these methods are clearly better than forgoing tool tracking altogether, they still have a lot of shortcomings when compared to the more modern, more mature technology solutions that have become available on the market. It’s hard to say how many businesses truly have an effective tool tracking solution in place.
Increase Your ROI by Investing in AirFinder OnSite
- Low Cost. AirFinder OnSite XLE is a fraction of the cost of competitors' pricing.
- Long Battery Life. XLE lasts up to 7 years with hundreds of location updates daily.
- Increased Efficiency. Spend less time looking for assets, and more time being productive.
Workers Spend Up to 47% of Their Time Locating Tools
As any business owner or manager can tell you, time is money. When your workers are spending valuable time looking for tools, it’s going to have a negative impact on your bottom line. If workers are spending up to 47% of their time locating tools, that means that they are spending nearly half of the workday conducting searches rather than contributing directly to the production process. As one can imagine, this can result in not just lost time, but also lost productivity, decreased efficiency, and increased labor costs. In addition, the frustration and stress caused by time wasted can lead to decreased employee morale and job satisfaction, which in turn contributes to high turnover rates. After all, no one wants to spend their time completing menial tasks that they weren’t technically hired to do.
But why do workers end up spending so much time locating their tools? Shouldn’t that be an easy, preliminary step in completing production processes? If you know where your tools are, this is absolutely true: you can simply retrieve them from where they are and begin completing more important tasks. But the issue arises when a company lacks a comprehensive organizational system or requires employees to share different specialized tools. If the tools aren’t kept in a consistent location, or they’re constantly moving between workstations, there’s no surefire way to know where they’re going to be without having some sort of tool tracking system in place. And as we’ve already said, 1 in 3 businesses don’t bother to use tool tracking devices at all, and there’s no guarantee that the other 2 businesses are using a solution that is particularly effective for their specific needs.
46% of Businesses Do Not Know What Tools They Have
On top of not always knowing the location of necessary tools and equipment, nearly half of businesses don’t know what tools they even have available. Alternatively, they might know that they have certain types of tools available, but not the quantity of each. This can make searching for tools even more difficult – imagine spending time searching for something that was never actually there in the first place! That’s an even more glaring waste of time than trying to find something that you know is there, something that you can actually locate if you look hard enough. On the other end of the scale, if you don’t know what you have available to you, you might end up spending money to replace tools that you already have.
How does this happen? How can companies simply not know what tools they have at their disposal? Admittedly, this tends to be a bigger problem for larger, multi-department companies, and it usually comes down to a lack of consistency and inter-department communication. If multiple departments are sharing the same type of tools, it can be hard to keep track of the overall quantity of those tools, especially if there is no shared system in place across the company. Tool and equipment tracking systems provide an obvious response to this: if you have all of your tools tagged and tracked, you can easily tell how many of a given tool you have.
Ghost Assets Make Up 5-10% of Documented Assets
Let’s take this a step further. What if you have a tool management system in place, but it contains records of tools that just don’t seem to exist? Clearly they did at one point, but now they’re nowhere to be found. Are they just lost? While that’s also a possibility, it’s worth noting that 5-10% of most companies’ documented assets are ghost assets, and that includes documented tools.
A ghost asset is any asset that a company still has records of, but that is physically missing or unusable. Essentially, it is an asset that no longer exists in a functional state but is still being accounted for. The existence of ghost assets can generally be attributed to poor tracking or record-keeping practices; they’re a particularly common challenge when using manual tracking. There are several types of ghost assets, including:
- Retired assets that were not removed from the balance sheet
- Stolen assets that were not reported or replaced
- Misplaced assets that are no longer in use or are in unknown locations
The catch is that it’s often difficult to tell how given assets became ghost assets, because as stated previously, they are often the result of poor record-keeping. If no one noted that a tool is no longer available for use, then it’s safe to assume that no one noted why that tool is no longer available for use. Ghost assets can result in a company overstating their assets, leading to tax and insurance complications; they can also result in companies not replacing necessary tools and equipment because no one has reported that those tools need to be replaced. Real-time tool tracking technologies can help prevent these problems, by offering insight to not only a tool’s location, but also how often it’s being used. Still, it’s up to operators to remove broken or retired assets from the roster once they’re identified.
Workplace Theft Causes Up to $50B in Losses Every Year
Workplace theft is a huge problem across the board, but what most people don’t realize is that it’s not products that are most commonly stolen, but rather, the tools and equipment used to make those products. While stealing products is more difficult and can affect personal productivity numbers, stealing tools and equipment is relatively easy, especially in a work environment where tools and equipment are commonly misplaced anyway. It also makes more sense on the thief’s part because it’s usually harder to obtain specialized tools and equipment than it is the actual products, so they can sell them for a greater return.
Dealing with the theft of tools and equipment is, luckily, far more simple and straightforward than a lot of the challenges posited within these statistics. Even the most basic automated tool tracking systems are created with the intention of providing location visibility. With a real-time visibility system in place, stolen assets can be quickly located and retrieved. Alternatively, companies can set up designated zones which will alert them if a given tool is removed from that location, preventing theft before it happens. It’s also worth noting that people are less likely to steal valuable assets if they know that those assets are being monitored. Think of the cameras at a self-checkout line – even the knowledge that they exist is intended to dissuade stealing. The same essential effect is afforded by an asset tracking system.
Tool Tracking Can Result in Up to $9M in New Revenue
But enough about the problems that tool tracking can solve. What about the new opportunities that it can create? Not only can a tool tracker help you save time and boost productivity, but it can also help your company increase your revenue by up to $9M with just a single initiative! Admittedly, much of this boosted revenue is a direct result of other tool tracking benefits. For example, less search time means higher productivity, which in turn means that more products can be sold. It’s also worth noting that tool tracking can help improve the quality of your products, which gives you the grounds and company reputation to increase unit price. Essentially, if you know you’re always using the best tool for the job, you know the finished product is going to be better.
This statistic is important to consider, because it proves that tool tracking systems have use beyond solving preexisting problems. Certainly, tool tracking is an ideal method of solving issues concerning search times, ghost assets, and workplace theft, but even if you aren’t having much trouble with those things, it can still be beneficial for your company. Your manufacturing operations could go from doing well to doing excellent with the added support that tool tracking provides; even if you’re not looking to offset your losses, it pays for itself in new revenue!
Don’t Become a Negative Statistic – Invest in Tool Tracking!
Investing in tool tracking can help you not only address your company’s existing problems, but also empower you to bring your manufacturing operations to new heights. And Link Labs is here to help! Our AirFinder Onsite asset tracking solution can help you maintain visibility of your tools across your entire operation. With up to 30-centimeters of accuracy, you can even differentiate between neighboring workstations for unmatched asset visibility. We can also help you keep track of how your tools and equipment are being used, helping you optimize your processes and extend asset life for even more savings down the road. If you want to learn more about AirFinder Onsite for tool tracking, book a demo to talk to a representative today!
