Asset Management Glossary
Key terms and definitions to help you understand asset management concepts
A
Application Inventory
An application inventory is a catalog of every application an organization runs, covering installed software and SaaS subscriptions, with owner, user, and cost.
Asset Audit
An asset audit is a physical verification of an organization's recorded assets, confirming each one exists, sits where the records say, and still works.
Asset Disposal
Asset disposal is the removal of an asset from service at end of life, through sale, recycling, donation, or scrapping, followed by a write-off.
Asset Lifecycle
The asset lifecycle is the full span of an asset's working life, from acquisition through deployment, maintenance, and repair, to retirement or disposal.
Asset Reconciliation
Asset reconciliation is the comparison of physical asset counts against the records in an asset management system, to find and resolve every discrepancy.
Asset Tagging
Asset tagging is the practice of attaching a unique scannable label, a barcode, QR code, NFC chip, or RFID tag, to every physical asset.
Asset Utilization Rate
Asset utilization rate is the percentage of an asset's available time or capacity that is actually in use, calculated as actual use divided by availability.
Asset Valuation
Asset valuation is the process of determining what an organization's assets are worth today, adjusted for depreciation, condition, and current market prices.
C
Capital Expenditure (CapEx)
Capital expenditure, or CapEx, is money spent to acquire, upgrade, or extend the life of a long-term asset such as equipment, buildings, or IT infrastructure.
Chain of Custody
Chain of custody is the documented, chronological record of every person, department, and location that has held an asset, from acquisition to disposal.
Check-in/Check-out
Check-in/check-out is the workflow that records who takes an asset, when it leaves, and when it returns, creating an accountability trail for shared equipment.
Compliance Tracking
Compliance tracking is the monitoring and documentation that proves assets meet the regulations, safety standards, certifications, and inspections that apply.
Cycle Counting
Cycle counting is an inventory audit method that counts a small subset of items on a rotating schedule, replacing the annual full physical inventory.
D
Depreciation
Depreciation is the accounting method that spreads the cost of an asset across its useful life, reflecting value lost to wear, age, and obsolescence.
Digital Twin
A digital twin is a virtual replica of a physical asset that stays synchronized with it through live sensor data, mirroring its condition and performance.
E
Equipment Calibration
Equipment calibration is the comparison of an instrument's readings against a traceable reference standard, then adjusting it back within an accepted tolerance.
ERP Integration
ERP integration is the connection between an asset management system and an ERP platform, so records flow between them without duplicate manual entry.
G
Ghost Assets
Ghost assets are items still listed in an organization's asset register that no longer physically exist, cannot be found, or are broken beyond use.
GPS Asset Tracking
GPS asset tracking is a location method that uses satellite positioning to report the real-time geographic position of vehicles, trailers, and mobile equipment.
I
Inventory Management
Inventory management is the practice of ordering, storing, counting, and controlling stock, so the right items are on hand without tying up excess cash.
IoT Asset Monitoring
IoT asset monitoring is the use of connected sensors to measure an asset's condition, performance, and environment, raising alerts when readings drift.
IT Asset Inventory
An IT asset inventory is a continuously updated record of every hardware, software, and cloud asset a company owns, with holder, cost, and lifecycle stage.
IT Asset Management (ITAM)
IT Asset Management, or ITAM, is the practice of tracking and optimizing every IT asset an organization owns or subscribes to, from purchase through disposal.
M
Mean Time Between Failures (MTBF)
Mean Time Between Failures, or MTBF, is a reliability metric giving the average operating time a repairable asset runs between one breakdown and the next.
Mean Time To Repair (MTTR)
Mean Time To Repair, or MTTR, is a maintenance metric giving the average time from detecting a failure to restoring the asset to full operation.
P
Predictive Maintenance
Predictive maintenance is a strategy that uses sensor data and usage trends to forecast when equipment will fail, so repairs are scheduled before the breakdown.
Preventive Maintenance
Preventive maintenance is the practice of servicing equipment on a fixed schedule of time or usage, before it fails, rather than waiting for a breakdown.
R
Reorder Point (ROP)
A reorder point, or ROP, is the stock level that triggers a new purchase order, set high enough to cover demand during the lead time.
RFID Asset Tracking
RFID asset tracking is a method that uses radio waves to identify and locate tagged assets without line of sight, reading many tags at once.
S
Safety Stock
Safety stock is the buffer inventory held above forecast demand to absorb late deliveries, demand spikes, and forecast error without causing a stockout.
Stock Replenishment
Stock replenishment is the process of restocking inventory at the right time and quantity, so parts and consumables stay available without accumulating excess.
T
Total Cost of Ownership (TCO)
Total Cost of Ownership, or TCO, is the sum of every cost an asset incurs across its life, from purchase through maintenance to disposal.
Total Effective Equipment Performance (TEEP)
Total Effective Equipment Performance, or TEEP, is a manufacturing KPI measuring output against all calendar hours, including nights, weekends, and holidays.
