Practice Head ServiceNow
April 9, 2025
In today’s competitive and capital-intensive manufacturing landscape, operational effectiveness and cost control are paramount. Manufacturing businesses rely on a wide range of IT assets—hardware, software, and network infrastructure—to run the business, provide support to production lines, and stay compliant with industry regulation. Poorly managed assets, however, equate to inefficiencies, increased maintenance expenses, and risk of noncompliance.
ServiceNow IT Asset Management (ITAM) helps manufacturers track the entire lifecycle of IT assets, drive asset utilization, become compliant, and reduce total cost of ownership by up to a percentage point. This report is a description of how ServiceNow ITAM makes manufacturing more efficient through reduced overheads, increased efficiency, and facilitating totally informed decisions.
1. The Role of IT Asset Management in Manufacturing
1.1 Overview of IT Asset Management IT
IT Asset Management (ITAM) refers to the management and tracking of an organization’s hardware, software, and other IT assets throughout their life cycle—acquisition and deployment to retirement and disposal. Effective ITAM allows organizations to make intelligent IT investment decisions and on maximum utilization of assets.
In manufacturing, IT assets can range from servers and workstations to specially designed software applied in enterprise resource planning (ERP), production, and design. Proper management of these assets makes a major contribution towards business continuity as well as avoiding unnecessary costs.
1.2 Major Challenges in Managing IT Assets in Manufacturing
The following are the major challenges manufacturers are facing in managing their IT assets:
- Asset Visibility: Lack of visibility in real time regarding how assets are utilized and what shape they’re in can result in idle or duplicate assets.
- Compliance Risks: Lack of ability to comply with software licensing contracts can result in costly penalties and legal problems.
- Operational Disruptions: Lack of ability to service hardware assets or accurately manage inventory can result in lost time in production.
- High Maintenance Costs: Management of warranty, service agreements, and repair requirements can be time-consuming.
- Security Risks: Cyberattacks also target manufacturing systems these days, and poor asset management can bring loopholes.
2. ServiceNow ITAM—A Game Changer in Manufacturing
2.1 What is ServiceNow ITAM?
The most significant features include:
- Asset Lifecycle Management: All phases of IT asset life cycle for greatest value and usefulness.
- Real-Time Tracking and Reporting: Real-time, end-to-end data on asset status, usage, and cost.
- Software and Hardware Management: Software licenses and hardware infrastructure management to optimize use and compliance.
- Contract Management: Management of contracts and service arrangements with suppliers to facilitate timely renewals and unnecessary spend prevention.
De Finibus Bonorum et Malorum
Hardware Asset Management Activities
| ID | Activities | Description |
|---|---|---|
| HAM 1.0 | Request Hardware Asset | Where the request for a hardware asset is initiated and approved. |
| HAM 2.0 | Source Asset | Where stock is reviewed to determine if a hardware asset is available to fulfill a Service Request or Change Request. |
| HAM 3.0 | Process Procurement Request and Create Asset Record | Where purchase requests for hardware assets are reviewed and approved... |
| HAM 4.0 | Receive, Store and Transfer Assets | Where new and decommissioned assets are received, and recorded in the asset repository... |
| HAM 5.0 | Install/Move/Add/Change Asset | Where install, move, add, and change activities are performed... |
| HAM 6.0 | Validate Assets for Refreshment | Where assets are identified and validated as candidates for refreshment. |
| HAM 7.0 | Retire Asset | Where assets are decommissioned, software installations uninstalled... |
| HAM 8.0 | Dispose Asset | Where disposal activities are performed, and end-of-life assets are physically disposed of. |
| HAM 9.0 | Maintain Hardware Product Models | Where hardware model records are created and published to a catalogue... |
| HAM 10.0 | Maintain Stock Rules | Where stock rules criteria are defined that state when inventory of a particular asset... |
| HAM 11.0 | Track Hardware Asset TCO | Where costs associated with the hardware asset are tracked and associated with the asset record... |
2.2 Benefits of Using ServiceNow ITAM for Manufacturing
- Cost Savings: ServiceNow ITAM saves costs by providing end-to-end visibility of asset utilization so that the producers pay only for what they use. The software also prevents over-licensing and over-purchasing of devices.
- Efficiency: Asset tracking, purchasing, and maintenance schedules automation replaces manual paper-based processes and conserves time, and hence, it becomes more efficient.
- Risk Mitigation: The platform strives to close and fill compliance loopholes, reducing the risk of software license infringement penalties and fines.
- Improved Decision-Making: Manufacturing executives can make data-driven decisions on asset acquisition, replacement, and optimization using analytics and real-time insights.
- Ongoing Optimization: With accurate warranty periods and service agreements tracking, ServiceNow ITAM prevents unnecessary maintenance expenses by doing repairs and replacements when they are needed.
3. Key Features of ServiceNow ITAM for Manufacturing
3.1 Asset Lifecycle Management
Asset lifecycle management is the foundation of ITAM for manufacturing. ServiceNow enables manufacturers to track assets from purchase through retirement. With automated asset tracking, manufacturers can:
- Categorize assets and track them in real time.
- Keep a history of warranty and service agreements on each asset in preparation.
- Schedule replacement or upgrade assets when best to reduce downtime or obsolescence.
3.2 Software Asset Management (SAM)
Software is at the heart of the manufacturing process for design, control, or enterprise resource planning (ERP). ServiceNow SAM module helps manufacturers:
- Monitor Software Licenses: ServiceNow monitors licensed usage and in relation to the licenses purchased to prevent over-licensing and wastage of spend.
- Track Software Usage: Giving visibility into software usage patterns, producers do not need to pay for unused software or underused licenses.
- Stay Compliant: The solution keeps up with licensing agreements automatically, avoiding producers from paying legal fees and fines.
3.3 Hardware Asset Management (HAM)
Hardware utilized for manufacturing may wear out, and saving costs relies on proper hardware asset management. ServiceNow’s HAM capabilities include:
- Real-Time Asset Visibility: Real-time monitoring of hardware status (e.g., usage, location, condition) enables underutilized or obsolete assets to be located.
- Automated Maintenance Scheduling: Preventive scheduling of maintenance reduces unplanned downtime and prevents costly repairs.
- Depreciation Tracking: ServiceNow also tracks the depreciation of assets so that manufacturers can know their actual value and make wise decisions on asset disposal or replacement.
3.4 Contract Management
Successful vendor contract management is the cornerstone of cost savings in manufacturing. ServiceNow Contract Management can ensure that:
- Renewals Are On Time: Regular renewal of contracts and warranties is ensured through automatic reminders and notifications, preventing disruption in service.
- Service Level Agreements (SLAs) Are Complied With: ServiceNow can assist manufacturers in tracking SLAs to ensure vendors are keeping their promises, averts penalties or delay in service.
- Cost Savings: Centralization of contract information enables manufacturers to negotiate terms and conditions more positively, and hence cost savings become feasible.
3.4 Contract Management
Successful vendor contract management is the cornerstone of cost savings in manufacturing. ServiceNow Contract Management can ensure that:
- Renewals Are On Time: Regular renewal of contracts and warranties is ensured through automatic reminders and notifications, preventing disruption in service.
- Service Level Agreements (SLAs) Are Complied With: ServiceNow can assist manufacturers in tracking SLAs to ensure vendors are keeping their promises, averts penalties or delay in service.
- Cost Savings: Centralization of contract information enables manufacturers to negotiate terms and conditions more positively, and hence cost savings become feasible.
4. ServiceNow ITAM Reduces Cost in Manufacturing Operations
4.1 Prevention of Over-buying and Waste Minimization
With ServiceNow ITAM’s real-time tracking and reporting capability, manufacturers can avoid over-buying hardware and software. Manufacturers can avoid waste and purchases for nothing, which are worth considerable cost savings, by maximizing asset utilization.
4.2 Minimization of Maintenance and Maximal Use of Assets' Life
ServiceNow automates maintenance and monitors asset health, allowing manufacturers to undertake preventative maintenance and maximize their IT assets’ lifespan. This avoids repair and replacement costs, thereby saving costs in the long term.
4.3 Minimizing Downtime
With optimum hardware and software management, unplanned downtime is minimized by ServiceNow ITAM. This is equivalent to improved shop-floor productivity and minimal disturbance of manufacturing procedures, hence resultant cost savings on operational delay.
4.4 Enhancing Compliance and Mitigating Risks
Non-compliance of software license agreements can result in legal actions and penalties. ServiceNow ITAM provides automated reporting and monitoring of compliance, and therefore the manufacturers do not incur the risk and cost of non-compliance.
4.5 Improving Operational Efficiency
ServiceNow ITAM is integrated with other ServiceNow modules such as Incident Management, Change Management, and Procurement for cross-department automation. Automation of the manual activities such as tracking and procurement saves labor expenses and enables the employees to spend time on higher-value tasks.
5. Real-World Example—Cost Saving in a Manufacturing Company
The client is one of the largest manufacturers in the world utilized ServiceNow ITAM for automating IT asset management activities. The success was:
- 20% cost savings on software licensing fees by improved tracking and optimizing the usage of licenses.
- 30% cost savings on hardware maintenance by automating maintenance cycles and proactive monitoring of the health of the assets.
- Improved manufacturing process uptime with hardware asset management optimization.
- Improved compliance with software licensing to prevent potential fines and penalties.
Final Thoughts
With the current production infrastructure, effective IT asset management is critical to cost reduction and process optimization. ServiceNow ITAM is an integrated solution that allows manufacturers to simply discover, manage, and optimize IT assets, thus reducing procurement costs, improving compliance, extending asset lifecycles, and improving operational efficiency. By implementing ServiceNow ITAM, manufacturers can reduce costs, mitigate risks, and stay competitive in a constantly changing market.
Author
Harini Krishnamurthy
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