Inventory Management is an enterprise-wide discipline concerned with the identification and tracking of Information Services (IS) hardware and software assets. Its three main areas of concern are:

Acquisition.

Redeployment.

Termination.

Figure 1. Asset Management phases and operations

Acquisition procedures are established to assist personnel in procurement of software and hardware products. Its main purpose is to ensure that proper justifications are performed and that financial guidelines are followed. Acquisitions require “Purchase Orders” to track and authorize the purchase, while the actual installation of equipment is performed by the Infrastructure or Facilities Management Department. Once added to the environment, a Master Inventory record is created to describe the newly added equipment and its components (i.e., Pentium IV PC with 512 MB or RAM, a 40 GB Hard Drive, CD Drive, Floppy Drive, Sound and Video Cards, a 56 KB Modem and a 10/100 Ethernet Connection, etc.). Inventory records can be used to calculate the resale price of existing equipment, when planning for an upgrade / replacement or reduction in size. The Inventory Report can be used to inform buyers of your stock and obtain bids on the purchase of your surplus equipment.

Redeployment procedures are responsible for ensuring that assets are tracked when moved from one location to another and that budgetary considerations are adjusted as needed. Should a product be moved in from its original owner, then the Inventory System is updated to reflect the new location and owner. In this case, the old product is deleted from the original owner's budget and added to the new owner's budget. If equipment is being deployed from one person, or location, to another, then a data wipe operation must be performed to insure that sensitive business, personal and/or medical information has been deleted. If data wiping procedures are not performed in accordance to Department of Defense standards, then the company is open to legal and civil penalties as defined in a number of laws (i.e., Sarbanes-Oxley, Gramm-Leach-Bliley, HIPAA) Redeployment requests can generate transportation activity (pick-up and delivery of equipment), facilities management activity (disconnecting device, data wipe, reconnecting device, etc.), inventory management update, and service activities associated with the device(s) being moved.

Termination is responsible for deleting the asset from the inventory when it is discontinued, or replaced. The owner's budget will be updated to reflect the asset termination and the asset will no longer be listed when location reports are generated. Whenever equipment is being terminated (even if for donation to charities or employees) a data wipe operation must be performed to eliminate any sensitive information from the hard drive. Additionally, a certified vendor must be utilized to insure that the computers components are disposed of in an environemtally friendly manner. This scrapping process must be certified, so that legal and civil penalties are no longer the responsibility of the terminating firm but rather the scrapping organization.

The Inventory System is maintained within a data base that ties an asset to its owner and defines the location where the asset resides. The relative importance of the asset is added to the inventory record in a Criticality field (i.e., Criticality = 1-5, where 1 is "Most Critical") and the current status of the equipment is indicated via a status field (A=Active, R=Redeploying, D=Donated, T=Terminated, etc.). Based on this information the contingency planning specialist can plan asset recoveries needed to support critical business operations and the facilities management group can schedule work events associated with equipment status changes (i.e., from A to R, or A to T, or A to D, etc.).

Like all data bases, the Inventory System will only be effective if its information is kept current. To ensure the accuracy of the Inventory System, while not adding too great a burden to company personnel, every effort must be taken to implement processes that maintain inventory data with a minimum work effort from personnel. To that end, we suggest automated form tied to equipment status and criticality changes, so that facilities management and business continuity planning can adjust their functions accordingly.

Inventory Management provides:

Up-to-date information about data processing resources through the creation and archiving of records in a centralized repository.

Financial records specific to a single component, or groups of components.

Component Status Indicators to identify a component as Active (A), Redeployed (R ), Donated (D), or Terminated (T).

Component Criticality definition (1-5, with 1 being most critical).

Service records for all components in the inventory.

Data used to support configuration diagrams of the hardware and software components contained within specific locations, or the entire data processing environment.

Reports can be generated from the Inventory and Asset Management Systems that would project the amount of revenue that can be generated through the sale of surplus equipment, or to define the number of components that have a criticality rating of ‘1’ so that you can project the costs associated with maintaining duplicates of critical equipment at reovery sites. Combining the two reports would allow you to reroute equipment being scheduled for termination to the Recovery Facility and eliminate the additional costs associated with purchasing duplicate equipment in support of recovery needs.

1.1.2. Scope

The Inventory Management discipline encompasses all system and data network elements from the mainframe to the server level throughout the enterprise.

All mainframe and data network based hardware and software assets must be identified and entered into the Inventory System. Any changes to these environments must be reflected in the Inventory System.

Financial and technical product information must be available through the Inventory System, as needed to support the functional responsibilities of personnel within the finance and contracts management departments.

Asset criticality must be included with asset descriptive and financial information, so that the Recovery Management department is supplied with the information it requires. Recovery actions must be implemented to safeguard critical assets.

Asset status must be included in the Inventory Management system, so that the component(s) can be serviced in adherence to legal, environmental, business, and industry requirements. This process should be used to drive the facilities management department via form routing when components change status from active to redeploy, donate, terminate, of scrap. An audit trail of activities associated with equipment status changes and associated actions must be maintained to certify actions and eliminate legal and civil exposures.

The Standards and Procedures Manual section relating to Inventory Management must be created and published. This section must describe the process by which assets are identified, entered into the Inventory Management System, tracked, and finally deleted. All information needed by personnel to perform Inventory Management functions must be clearly described within this S&P Manual section.

1.1.3. Mission

The mission of an Inventory System is to provide a Central Asset Repository of information used to define assets and relate the asset to its; owner, location, and relative importance. This information will provide personnel with data needed to support their job functions, for example:

Facilities Management will be able to plan Heating, Ventilation and Air Conditioning (HVAC) requirements, as well as power and floor space needed to support equipment listed in Asset Repository for a specific location. To also perform the functions needed to adhere to legal, environmental, business, and regulatory requirements associated with equipment redeployment and termination.

Financial Services will be able to budget for asset procurement, depreciate assets over time, and complete tax documents. A report of equipment and their resale value can be used to aid in planning equipment upgrades and to reduce the “Total Cost of Ownership” associated with equipment.