Review And Remodelling Of Asset Management | Outlook Of A Selected Higher Institution Of Learning In The Eastern Cape Province, South Africa

10. 12. 2022

University asset management practices do not follow the modern best practice of information systems. Numerous procedures were carried out manually and were not automatically updated in the system. Additionally, the current system used in the institution needs review to enhance accountability. It is challenging to differentiate universities from the ownership of assets; as a result, an information system that acts as a tool in the asset management procedure is necessary. In addition to employing spreadsheets for most of asset management, private universities also tend to handle their assets decentralized. By developing a digital asset management system, these issues can be resolved. A straight line method is utilized for challenges involving determining the useful life of an asset and estimating the depreciation of assets. The study sampled 40 participants, and the researcher adopted the pragmatic paradigm. The finding revealed that, despite having an Asset Management process, the institution is still far from assuring its efficient and effective implementation. The results further indicated that the lack of coordination and clear grasp of how some of the institution's staff should apply the policies was an issue. It is recommended that the management of the institution must establish a structure that encourages compliance, consistency, and tracking throughout the execution process to ensure accountability and openness that will lead to cost savings.



Effective asset management needs effective and efficient storage, tracking, and monitoring of equipment (Idowu, Strüber, & Berger, 2021). Asset management is keeping track of, gathering information about, reporting and recording assets at a specific time based on existing guidelines. Effective asset management to support operational activities, particularly in the upkeep, repair, and acquisition of assets for the organization, is crucial to any institution. This study aims to review and remodel an asset management system for universities that will handle asset data and incorporate asset depreciation computation systems.

One of the essential issues at Walter Sisulu University that recently raised concern is the asset management (AM) and supply chain management (SCM) policies that are not set up correctly to support five-year strategic planning. Ever since the university was founded on July 1st, 2005, the Asset Management Policy left out certain of the Global Financial Reporting Standards (IFRS). The management of supply chain policy does not address the size and form of WSU to accomplish the major goals.

By developing efficient and effective policies that are in line with the new model, the issue may be resolved. According to the South Africa Higher Education Act 101 of 1997, the study will also strengthen or improve the yearly performance plan, which will align with Walter Sisulu University's strategy plan from 2015 to 2019 (2020–2025).

This study focuses on Walter Sisulu University Supply chain and Asset Management, specifically the Mthatha campus of the institution. The rationale behind choosing the Mthatha campus is that WSU is comprised of three campuses, with a total student enrolment of 33769. Mthatha campus is the largest of all four (4) campuses of the University (Songca, Ndebele, & Mbodila, (2021), with 15407 students enrolled. WSU's overall Asset On July 1st, 2005, the University of Transkei and the former line of command Technikon, Eastern Cape Technikon, merged to form Walter Sisulu University (WSU). WSU is a higher education institution that complies with the Higher Education Act 101 of 1997, as amended. Higher education in the nation underwent a reorganization process that started in 2002 and was completed in 2005. This institution provides a wide range of academic options, including faculties of business administration, educational sciences, health sciences, humanities, social sciences, and law, as well as natural sciences. This university is situated in the Eastern Cape under the jurisdiction of OR Tambo District Municipality.

Management of Assets wouldn’t be an issue of serious concern if WSU management is proactive in putting these policies into practice to reduce the risk that will arise with Asset Management Policy; the results will be in their favor. It will also be crucial for WSU to have a solid Asset Management Policy (AMP) to generate auditable financial statements in compliance with current reporting standards. Due to the limiting criteria, the new policy will improve daily operations and make them more productive and efficient without endangering the safety of the financial workers. Asset accountants will benefit immensely from having a reference point in terms of reporting requirements for grant assets thanks to the adoption of International Accounting (IAS) 20 on the AMP and SCMP.

Any organization that wants to function successfully and efficiently has to have some excellent policies that are in keeping with its mission, objectives, and vision while also abiding by the law it is working under. In Walter Sisulu University's case, the Higher Education Act 101 of 1997. The management, internal stakeholders, and external stakeholders will all benefit from the thesis (society). To enable the stakeholders to make strategic decisions supported by strong laws. In this instance, the Supply chain and Asset Management. The new policy incorporates external stakeholders in a variety of ways. For example, the SCMP will also serve as a guide for possible service providers who want to work with Walter Sisulu University.

Asset Management (AM) policies are not set up properly to attain five-year strategic planning. Since Walter Sisulu University was founded on July 1st, 2005, this led to the Asset Management Policy leaving out certain Financial Reporting Standards (IFRS). The size and form of WSU are not addressed by managing the supply chain policy in order to accomplish the major goals. Implementation of lied down Asset management policies will ensure a decrease in risk that will arise from Assets. The outcome will work in its favor. In order to generate auditable financial statements, it will also be crucial for WSU to have a solid Asset Management Policy (AMP). Furthermore, the implementing AMP will improve daily operations and make them more productive and efficient without endangering the safety of the financial workers. 


The current Supply Chain Management (SCM) policy of WSU was authorized by the Council in 2016; nevertheless, the University had significant implementation problems with SCM, which are thought to be the cause of the reduction in overall performance. A SCM policy, according to Sibanda, Zindi, and Maramura (2020), directs the relevant organization on important supply chain-related concerns. Regarding Walter Sisulu University, it is unclear how the institution should handle the revaluation of all assets and the provision for asset impairment. It is more challenging to decide whether the asset should be sold or not, and if sold, what are the restrictions to the disposal value because the policy is unclear about the lifespan of motor vehicles. Walter Sisulu has not been operating correctly over the years, to the point that it has neglected to pay its employees' paychecks. Poor SCM procedures, for instance, led to the University being placed under administration and having to temporarily shut down owing to a lack of resources in 2012. Based on this issue, the research looks into SCM potential and difficulties with the end objective of creating an SCM framework that would enhance Walter Sisulu University's overall performance in the future.

The following list of challenges in using the present Asset Management (AM) and Supply Chain Management (SCM) policies at Walter Sisulu University:

  • Walter Sisulu University does not appropriately execute Asset impairment In line with the International Accounting Standards (IAS) and the provisions of the Higher Education Act of 1997.
  • Not using an independent valuer to assess an asset's usage value before selling it.
  • Alignment of the WSU Asset Management Policy with Section 42(1) of the National Road Traffic Act 93 of 1996 on the roadworthiness of automobiles.

The fundamental issue with the WSU SCM policy, which was authorized on February 2nd, 2016, and evaluated on November 29th, 2019, is that it was not adequately implemented. The process of deviation and how it would impact the IAS (International Accounting Standards) reporting standards in relation to government funds or any grants are not explicitly stated in Section 5.3. The Walter Sisulu University Supply Chain Management Policy (WSU SCMP) has bearer factors on Section 2.12 delegation of Threshold limiting daily operations, which exposes Walter Sisulu University finance to be in violation of WSU SCMP because some departments, like Student Affairs, are frequently transacting above the set thresholds because of the needs of their respective departments.

Subsequently, the University manages and records financial transactions using the Integrated Tertiary System (ITS). In accordance with Section 3 Subsection (5)-(3) of the Higher Education Act 101 of 1997. Given the aforementioned claim, the SCMP lacks adequate direction on dealing with the issue of exceptional commitments on the incorporated. Effective public procurement is based on a set of basic behavioural principles referred to as the Five Pillars of Procurement, according to the Public Finance Management Act of 1999's General Purchasing Policy for the Republic (Gray, 2021).


The objective of this study is to:

  • To evaluate the strengths and weaknesses of Asset Management Policy implementation at Water Sisulu University
  • To establish Supply Chain Management Policy and Asset Management Policy that Walter Sisulu University may implement.

Resources that are under the control or ownership of a company and may be valued in monetary terms are called assets (Sasidharan, Parlikad, & Schooling, 2022). Asset management is the practice of documenting, reporting, and tracking assets at predetermined intervals in accordance with legal requirements (Cavka, Staub-French, & Poirier, 2017). There needs to be a model that will support the Asset management process for it to be effectively carried out. Asset Management Information Systems (AMIS) is an information management system that gathers inventory assets for all organizational bodies to provide efficient administration and data collecting on products. An endeavor to organize documents pertaining to data collecting on the presence of assets and asset management procedures is the implementation of an asset information system. Yang, (2020) alluded that essential asset in higher education must be well-managed and routinely carried out in order to prevent disruptions to business operations, particularly those involving the usage of assets. Before this earlier researchers focused on computer lab assets, tracking the progress of computer repairs, loans, and asset returns, and collected asset data with asset life to create asset management systems with various techniques. The scope of Asset Management is currently expanding, covering several areas that will transform higher institution’s financial systems and SCM if adopted and properly managed. 


Research is an intelligent and systematic human activity that thoroughly examines reality in a particular field (Silverman, 2020). In that order, the four pillars of research philosophy are positivism, realism, interpretivism, and pragmatism. These elements are included to make the assumptions regarding a study, to clarify, and to offer guidance on the proper techniques and tactics. The pragmatic paradigm served as the foundation for this investigation. The pragmatic paradigm was selected because of its ability to have a thorough grasp of how higher education institutions implement supply chain management and asset management policies while considering the regulatory frameworks that govern the university. The pragmatic school of thought typically drew from phenomenology (the analysis of competence from the perspective of the individual based on the subjective awareness paradigm) and interpretivism (the appropriate demand of explanation as part of the research system) (Nunfam, 2021). 

The pragmatic perspective contends that reality and existence are social constructions prone to change because human action impacts how we perceive a dynamic world and also relies on statistical values to arrive at a conclusion. The research paradigm was used in this study since it was thought to be more relevant.


According to Moser and Korstjens (2018), sampling is the act of selecting an appropriate group of carefully chosen components from the research population while keeping in mind that the characteristics of the components must be such that, if possible, the results can be generalized to the target audience. Pitard (2019) emphasizes sampling as a key component of the inquiry.

For this study, a sample of respondents from the university was chosen using purposeful sampling. Moreover, the criterion sample approach was used by the researcher to evaluate the distinguishing characteristics required of the respondents, which either qualify them for participation in this study or exclude them. Due to time restrictions, only 40 of the researcher's expected 100 interview responses were successfully obtained for the study. There were twenty-two (22) support staff members and eighteen (18) faculty members.


In this study, secondary data was also from previously published sources such as books, conference papers, journal articles, newspapers, reports, official documents, and websites of organizations. Interviews and observations are used to acquire primary data in accordance with (Velardo, & Elliott, 2021).

These two categories of sources comprised the majority of the primary and secondary data sources utilized to support the study's main finding. Literature evaluations are made more challenging by the notion that evidence is acquired from various sources (triangulation). Leedy and Omrod (2015) provide six techniques for gathering case study data: field notes, interviews, individual observation, and observation. Every data collection technique should be tailored to the study strategy to generate a story essential for understanding the situation. Interviews were conducted to understand more about the essential components of the subject from the perspectives of the academic and support personnel.

Frequency analysis, mean, and medians, were used to analyze the quantitative data in keeping with (Mohajan, 2020). The process of qualitative data analysis includes becoming familiar with the material, transcribing it (which turns verbatim audio recordings into text), arranging it, coding it, and producing a report that highlights the findings. This is in line with (Järvinen, & Mik-Meyer, 2020).

Subsequently, the data pertinent to the study and provided answers to the research questions were carefully chosen by the researcher. Data that would create ambiguity and meaning were avoided. The researcher was able to frame the questions in such a logical way that respondents were able to react to every one of them; open-ended, written replies, for example, managed to provide the correct depth. Moreover, the content analysis method was used to organize the data collected to produce insights and accurate results.



The data presented in this part depicts participants from both academic and support workers. According to figure 1 below, 60% of the participants in the research were men, and 40% were women. Ten (10) of the women were members of the support staff, and fourteen (14) were academics. Four (4) members of the academic faculty and twelve (12) support employees made up the male population. These numbers show that, in contrast to male participants, women were much more interested in participating in the study.

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Figure 1 -Gender


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Figure 2: Age group. Source: Researcher

According to graphic above, the age group from 40 to 49 comprised most respondents (15), preceded by the 30-39 age group (10). In comparison, the youngest age group was 6 and up (1). At WSU, people between the ages of 40 and 49 make up most of the staff in the academic and support sectors.



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Figure 3: Participants according to a period of service in the university

Most of the participants, 11, had been employed by the WSU institution for between one and five years. At the same time, those who have been employed by the institution for 10–15 and more years are ten (10). And there are eight (8) employees who have worked at WSU for five to ten years, while the number of employees with a one-to-one year of service is just one (1). Most of the participants in the study had the knowledge and extensive experience in the fields of supply chain management and asset management, which allowed them to provide rich information and adequately address the research questions. Consequently, these results were advantageous to the study.



Stakeholder’s awareness of Asset Management Policy. Source: Researcher

Most respondents (32) stated there is no awareness of the Asset Management Policy among key stakeholders at WSU. This raises concerns since the stakeholders won't have a thorough grasp of the policy's issues or modifications or whether there are any gaps in its application. Additionally, people in charge of execution would not be allowed to express their views on the policy or any potential modifications. The remaining respondents said that the institution does spread knowledge of its Asset Management Policy among its stakeholders.

These results are at odds with Universities South Africa's (2015) study, which claimed that knowledge of good asset management concepts helps institutions better utilize their human resources to achieve their objective. Thus, employing one of the strictest strategies, such as reliability-centered maintenance, will guarantee that key parties realize institutions must determine the ideal repair prices of the items, starting with the most vital assets (RCM). Furthermore, Bastas and Liyanage (2018) guarantee that the resources (both financial and human) necessary to carry out the maintenance strategy are allocated by informing stakeholders of the policy. Organizations need to have a plan to reduce the talent deficit among those who will be performing the jobs (Liyanage 2012). However, according to Arlbjrn, Freytag, and de Haas (2011), several institutions find it difficult to understand the inherent functional characteristics of their current assets. As a result, they run afoul of their ability to optimize the efficiency of their powerful assets. Functioning beneath or above the job has a detrimental effect on the usable life of some assets. Unfortunately, people behave as they choose to at any time. They decide to speed up, slow down, or continuously run assets that are intended to be operated periodically.

Unfortunately, WSU doesn't somehow prioritize educating its employees about its asset management policy even though they use the assets regularly. And to use its assets efficiently for the duration of its intended lifespan, an individual must comprehend how such an asset is acquired and what is expected of them. And what happens when a staff member utilizes the institution's assets outside the building? They still bear full responsibility for whatever happens to the loaned assets.


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Figure 4: Model for enhancing adherence to Supply Chain Management and Asset Management Policies Source: Author’s Own

The majority of respondents (25%) agreed that WSU must maintain institutional websites and help desks open to all users to improve adherence to SCM and Asset Management policies. Others (22%) said that stakeholder engagements must be conducted in addition to training, workshops, seminars, and presentations. While 10% highlighted the necessity for the handing out/distribution of handouts/fliers/notice board posts that serve as a reminder of what is expected of employees in terms of adherence to these rules, others (13%) said that WSU should include the use of Finance Indaba by making policy awareness. Few (5%) respondents emphasized the necessity for employee evaluation incentives to encourage others to follow policy standards. Few (3%) said that WSU should have harsh penalties for violators who abuse or circumvent these regulations.

These findings are in accordance with the National Treasury 2015 and Parliamentary Monitoring Group (2013), which support the development and use of efficient SCM methods and internal standards. As a result of this process, SCM is implemented in a reasonable, equitable, transparent, creative, and economical manner. Additionally, state colleges may be successful in upholding the law, which lowers the possibility of fraud, dishonesty, and favoritism as well as unauthorized and irregular actions in these institutions. Gopalakrishnan & Haleem (2015) opined that effective risk management inside the SCM system ensures the fundamental goal of a quality system, which is to provide a framework that governs the operational status of the institution's resources while making sure there is no risk involved. Finally, to minimize potential risks, there has to be a readily adaptable risk matrix that incorporates adherence to current regulations, training of staff personnel to be "Fit for Purpose," and adequate communication with essential stakeholders.


Figure 5: Integration of Stakeholders in Asset Management Process of WSU SCM policy (Source Owner).

According to the respondents, tthe institution has to develop a platform that would inform all key stakeholders on policies and compliance. Several of committees must be established to oversee the SCM and Asset Management functions, and all budgetary staff must be included to determine what, how, and when to implement the Asset Management policy. Finally, regarding the administration of assets, managers must be able to evaluate and approve requests online.

This is consistent with ISO's (2014) emphasis on the requirement to monitor assets to ensure that management guidelines are being followed. As a result, it involves handling every asset for suppliers to achieve the organization's quality requirements. Seipp, Michel, and Siegfried (2020) Furthermore, a centralized supplier database's inefficiency hinders the possibility of compliance through SCM, which causes suppliers to lose their chance to conduct business with the institution. One of the factors contributing to SCM's low performance is the mindset of noncompliance with its restrictions (McMaster, Nettleton, Tom, Xu, Cao, & Qiao, 2020). Therefore, governance and compliance processes must be in place to ensure that SCM deliverables and outcomes are of high quality and within acceptable risk exposures. (Public Sector SCM Review 2015).

Before making informed decisions on using SCM, Srivastava, and Rogers, (2022), concur that the managerial group has to gather more information and have a better understanding of the situation. Additionally, there must be successful management of stakeholder development, including being proactive in needed change by planning in advance. For the institution to endorse the notion, transition management must be executed in a context where staff members are guided through every part of SCM. Each aspect adds to bad asset management if this is done wrong. Performing a risk assessment that includes risk detection, contingency planning, and risk evaluation, as well as keeping an eye on assets and operations and reviewing them, is how SCM helps with risk management within asset management (Gopalakrishnan & Haleem, 2015). According to the emerging finding, management must be proactive and open to introducing the subordinates to the SCM for all users to be aware of the entire process.


In this regard, 27 respondents reported that the Asset Management division did not follow up on old-fashioned assets for disposal, according to the data. The division does follow up on the outmoded assets for disposal, according to (13) respondents. At the same time, the outcomes go against RSA (2004) Section 40 of the SCM Regulations, which placed a strong emphasis on asset disposal in the Asset Management policy. The institution is obligated to follow all operational procedures for disposing of and authorizing the use of assets, such as inoperable, pointless, or old assets. The SCM policy includes a few methods for getting rid of products. These strategies include: 

  • Transferring the asset with some other government body at even a discounted rate or, where appropriate, for no cost
  • Disposing of the asset through the public auction of an unused or old asset

According to Standard Norge (2014), a proactive approach to combining regulations, laws, and regulations that have various effects on assets is to check for out-of-date assets as part of asset management. This means that having a current, useful asset management policy is crucial for directing personnel in charge of disposal during the process as to what to do and how to accomplish it. Additionally, it provides a clear illustration of how assets should be managed successfully throughout the whole Process (National Treasury, 2015).

Even though WSU has an Asset management policy in place, its complete execution is inadequate since the university doesn't have a plan for monitoring every asset purchased throughout the whole organization to assess its condition and determine if it requires maintenance or to be disposed of. These findings are concerning since numerous employees may use this vulnerability and simply steal assets for their own gain.


Figure 6: Strategies to enhance bar-coding of assets. Source: Researcher)

The themes that emerged from the respondents' suggestions for potential strategies WSU may use to barcode and record its present and future assets. These included the verification and valuation of the assets, as well as ongoing/continuous upgrades. Others point out that an inventory system is required and that it may be used to upgrade the assets after a successful acquisition of new assets. Another recommendation called for WSU to permit a single place for receipt delivery, which would make it simple to keep track of the receipt and transfer of the assets throughout the institution. The respondents also stated that an electronic system must be developed to track and control the movements of the assets. Others stated that there must be a strong connection between the institution's asset management unit and all other departments. The assets must also be documented and bar-coded for simple monitoring before being given to the users. Finally, the institution has to limit the staff's access to its resources.


The findings that emerged in this study from respondents (academic and support staff) employed at the Walter Sisulu University revealed that although WSU has these policies available, they are far from assuring an efficient execution of them. The respondents had experience applying the Supply Chain Management and Asset Management Policies. In addition to the findings, it is apparent that WSU departments and personnel lack coordination and a thorough understanding of how rules should be applied. Relevant stakeholders and end users must drive the implementation of these rules, and management must provide a structure that promotes consistency and compliance throughout implementation.

Despite the many difficulties that WSU is having with the SCM and Asset Management Policies' implementation, the institution works hard, much like many other institutions that already have SCM and Asset Management Rules in place, but there is still space for improvement in terms of how well these policies are put into practice. These participants provided options, such as having and enabling public access to university websites/helpdesks on these rules so that users may refer to them when necessary to comply in these areas. The focus of WSU should be on intensive training, seminars, workshops, and conferences that bring together the many stakeholders and inform them on the policies in question, particularly their implementation and what is expected of each of them. To recommend adjustments in a timely manner, the organization has to allocate some of its financial resources toward raising as much consciousness as necessary regularly and analyzing when these two policies execute appropriately and any difficulties they experience. 

At this juncture, WSU must make these improvements to guarantee that mechanisms, such as incentives, are made available to people who fully adhere to and comply with all these regulations. Secondly, a punishment system should be applied to anyone who does not adhere to the rules and guidelines outlined in implementing effective SCM and Asset Management Policies. The study demonstrates in a good way that the participants share this attitude, are aware of the negative effects of the institutions, and are creative enough to contribute their suggestions for how the institution may be improved. These participants are aware of the failure of the Policies applications but are given no room for a way forward. In sum, WSU requires training and all relevant stakeholders on how such policies can effectively be implemented.

NOTE: This Article is drawn from Thesis by the author’s submitted to LIGS University as part of the requirements Doctorate in Business Administration.

Author: Lonwabo Luklhanyo Vikilahle



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