IR Editorials

Catch up on some of the educational articles appearing in the Investment Recovery Business Journal, ASSET 2.0.

"Gordie Chennell Wins Bell Aliant Achievement Award"

Late in 2007, it was identified that Bell Aliant had not recovered any salvage dollars for scrap wire or wire pulled from service from large tear-down projects. Gordon Chennell, operations manager-materials, started on a fact-finding mission that led to the development of a new business process to ensure Bell Aliant received reasonable returns on the sale of this scrap wire. (read more)

"CMIR's Take Ethics Pledge"

Ethical and professional conduct are the hallmarks of those achieving Certified Manager of Investment Recovery status. Below is the pledge that almost 200 CMIRs have taken upon completing their coursework and passing the required examinations. (read more)

"TRUST US... Things to Know About Antitrust"

Trade associations, which, by their very nature involve interaction among competitors, are subject to close scrutiny for antitrust violations. Criminal sanctions for inappropriate behavior have increased substantially over the past decade (up to $10 million for corporations and $350,000 and three years in jail for individuals!), so members must be very careful to keep their activities within the prescribed bounds. (read more)I

"IR: When "Doing More With Less" Becomes an Opportunity "

Investment recovery (IR) departments are historically understaffed, and today’s economic downturn has exacerbated the issue. The corporate mantra of “do more with less” has made it difficult for many programs to provide the level of service to which their customers and clients are accustomed. (read more)

"Like-Kind Exchanges: Save a Truckload On Taxes When Selling Heavy Equipment"

Companies can defer taxable gains on qualified sales of surplus equipment by taking advantage of like-kind exchange (LKE) transactions as discussed in the cover story of this issue of ASSET 2.0. Taxable gain (or loss) of a surplus asset is determined by subtracting the sale price of the surplus from the adjusted cost basis (original purchase price less accumulated depreciation). If the basis is at or near zero, nearly all of the sales proceeds would be subject to capital gains tax. Because heavy equipment generally has a long operational life, it typically lasts longer than the depreciation. That means you could get taxed heavily on the sale of heavy and process equipment surplus (unless you use a 1031 exchange). (read more)

"Industry Snapshot: Utility IR- Transforming Oil-filled Equipment Into Cash" Regulation and the

unique disposition requirements of transformers and other oil-filled equipment are the primary differentiators between utility company IR managers and their counterparts in other industries. And their disposition requirements are huge! Regional utilities in the midst of upgrades can recycle upwards of 40 million pounds of oil-filled equipment in a year. Twenty million additional pounds of scrap metals from electrical cable and other assets is a fairly common annual figure as are a thousand or more vehicles! So utility company IR departments are pretty darn busy! (read more)

"1031: Like-Kind Exchanges" In recent years, corporations have invested more heavily in asset recovery strategies, realizing that a surplus of depreciated assets was costing American businesses billions of dollars each year. As a result, asset recovery groups are now focused on boosting internal efficiencies, increasing revenues and preserving the value of business assets. New requirements to reduce idle inventory, recycle useable materials and otherwise maximize asset values have placed a significant burden on those charged with tracing and reporting the final disposition of business assets. (read more)

"Demolition" or "Deconstruction?" The difference between these two terms become mere semantics for IR professionals, because 'carefully preserving valuable elements for re-use' pretty-much sums up the entire profession. (read more)

"Recycling and Renovation" Faced with the decision of renovating, recycling or replacing? Here are some helpful tips to help you choose the best option for your company. (read more)

"Benchmarking - A Key Benefit of Association Membership" Curious about what the Benchmarking Committee does and how their surveys benefit the association? All of your questions (and then some!) answered here... (read more)

"How Technology Increases the Scope of Auctions" - Recent technological advances have produced many new and effective liquidation strategies that offer pre-auction options. Depending on the timeline (still an all-too-frequent hurdle), Investment Recovery professionals now have a plethora of opportunities available to help get increased visibility and top dollar for surplus assets. (read more)

"Online Auctions" - With the ongoing advancement of technology, online auctions have become a viable and proven resource for the disposition of surplus inventory. For the seller, an online auction exposes surplus equipment to thousands of pre-qualified bidders on a global scale, providing the opportunity to maximize recovery. (read more)

"Doing More With Less" - Like much of corporate America, Investment Recovery professionals are finding they have fewer resources with which to accomplish their ever-growing responsibilities. Here are a few thoughts on how to manage the workload while maintaining some sense of sanity and control! (read more)

"Exploring the Auction Option" - When it comes to selling non-performing assets such as used construction equipment and trucks, the number of decisions to be made can be overwhelming. How to sell. When to sell. Whether or not to outsource. Doing some research and weighing your options will help you sell these types of assets for the highest possible return in the shortest possible time. (read more)

"The CFO and Redeployment" - It is widely acknowledged that companies achieve the highest returns from surplus assets when they can be reused within the organization, avoiding new capital expenditures. Knowing that redeployment maximizes the ROI of surplus assets—what can the Investment Recovery professional and the Chief Financial Officer (CFO) do to help? (read more)

"Demolition Q&A" - Demolition is perhaps the ultimate outsourced service requested by investment recovery practitioners; but like all outsourcing, turning a project over to outside professionals doesn't necessarily guarantee success. To help insure that your next project doesn't blow up on your watch, ASSET 2.0 turned to the Associate Members for some dynamite insight on the demolition process. (read more)

"Overcoming the Surplus Asset Challenge" - At first glance, finding a second home for surplus assets within your own organization should be easy. Like a ride in the park, right? After all, it obviously fit into corporate standards at one point, and the fact that you are even considering redeployment indicates that there is still useful value, even if some in the organization see it as an asset that has traveled its last mile. Four seasoned Investment Recovery professionals share some of their insights into the redeployment process. (read more)

"Going Green Saves Green" - Several years ago, the National Demolition Association did a survey of the general public and found that most people believed that all of the debris from demolition jobs went to landfills. Nothing could be further from the truth; demolition contractors recycled long before it became popular. (read more)

"Environmental Issues in Demolition" - In recent years, some of the "dream" building projects of our parents and grandparents have become today's demolition nightmares because they contained asbestos, PCB's or lead paint. As a result, it now often costs more to remediate industrial sites than it does to demolish them. Here are a few of the more common environmental concerns associated with demolition. (read more)

"Developing Effective Metal Management" - Knowing what not to do and what questions to ask keeps any scrap metal management system efficient, viable and profitable. Stewardship of a valuable asset is not "dealing with junk". Much more is involved in providing effective scrap management than having "a deal" or contract in place with the local vendor. (read more)

The Value Chain - Part V As you increase your experience with Michael Porter's value chain model, the investment recovery function should become a constant, almost invisible part of identifying opportunities that add value, drive out costs and better respond to customer needs in your organization's primary and support activities. (read more)

FIN 47: Retired Asset Accountability The Sarbanes-Oxley (SOX) legislation brought the need to have transparency in financial statements to the forefront of corporate issues. And though many companies continue to look at SOX as a "Financial Department Issue", related regulatory action and interpretations by the Financial Accounting Standards Board (FASB), connected to 'Retired Assets' accounting, has complicated the life of investment recovery managers. (read more)

Maturation of the Investment Recovery Industry Changing market conditions, new manufacturing processes, corporate restructuring and new technology create idle assets that, without astute management, become financial liabilities and put pressure on the bottom-line. The pace of advancements in technology continues to accelerate this process. The more company profits are squeezed, the more successful corporations focus on recouping asset investments. (read more)

Roundtable Notes: Outsourcing Think of outsourcing as another tool in your belt. Outsourcing makes sense when you don't have the internal resources or expertise to do the job. (read more)

Roundtable Noes: Technology The discussion kicked-off with the process used by an energy company for IT surplus management. Briefly, it consists of the following: Equipment is sent to a central warehouse where a form with general info is filled out and the equipment is added to a master list.

(read more)

Doing Business in China Recycled products in the medical, construction, and electrical industries are in high demand, as are factory process equipment and industrial machine tools and scrap material. However, recycled products in the telecommunications, aerospace and transportation, and IT industries are not popular, as China is seeking to leap-frog several generations of technology to obtain the cutting-edge products in these industries. But if you decide that the Chinese market may be right for your surplus, it is important to understand Chinese business practices. (read more)

Cutting-Edge Generational Leadership Investment recovery professionals are required to work with many groups within their organizations. Bringing out the very best of each generation every day is a clear road map to leadership success. Leaders who win consistently find creative paths to motivate generations to collaborate in new ways in order to win and grow the business together. (read more)

The Cost of Holding Surplus Inventory The Cost of Holding Surplus Inventory can be surprisingly high. Surplus Inventory (idle non-performing assets, excess to the companies needs.) can come from all departments within an organization. (read more)

From the Basement To the Boardroom: Selling Investment Recovery Internally Investment Recovery has long been thought of as the final resting place for company assets, the place where excess and obsolete assets go for final disposition. But how does the final link in the supply chain impact your company? (read more)

CMIR Marketing Checklist Managing and controlling all the elements and processes to achieve and maintain quality results for your company's Investment Recovery effort is challenging to an IR manager. Keeping focused on the goals, objectives, and results is critical to your long-term success and is also an integral part of the marketing effort you put forth. (read more)

IR Marketing: The Value Is In the Details Marketing surplus assets, regardless of the items, begins with knowing exactly what the assets are. It involves knowing the internal circumstances around the decision to sell, determining the market (potential use) for the assets, and then deciding on the method or strategy for selling. Sounds simple and straight-forward, right? It is, except for the much-over-looked fact that no two assets are the same, and no two markets are the same. (read more)

IT Recovery Services Given the well-recognized environmental hazards lurking in most electronics, the dumpster is no longer an acceptable disposal strategy, and while there are a variety of asset removal options for old hardware, successful execution means planning and effort from already overworked IT staffs. (read more)

Taking a Look Back Helps Retailers Stay A Step Ahead Retail industry analysts and leading academics agree, merchandise returns now amount to more than $100 billion per year, with returns management draining away as much as 35% of potential retail profits every year. In a tough economy where companies face increasing pressure from competitors and growing demand from customers, recovering that cost is critical to bottom-line growth and longterm competitive advantage. (read more)

Using Reverse Logistics to Boost Asset Recovery Logistics is defined by The Council of Logistics Management as "The process of planning, implementing, and controlling the efficient, cost-effective flow of raw materials, in-process inventory, finished goods and related information from the point of origin to the point of consumption for the purpose of conforming to customer requirements." Reverse logistics includes all of the activities that are mentioned in the definition above . . . but in reverse! (read more)

"Help! I'm your laptop and I've Been Stolen!" How to recover your stolen laptop, or at least destroy its secrets, using the latest crime-stopping gizmos. (read more)

Asset Identification: Radio Frequency Identification Tags Radio-frequency Identification (RFID) is a continually evolving technology for tracking and monitoring inventories. While it will be some time, years probably, before RFID is a widespread method for tracking surplus industrial assets, it is presently being used in certain commercial applications. (read more)

Worldwide Trends Are Transforming High-Voltage Supply Markets Natural disasters such as Hurricane Katrina and other catastrophic weather events, as well as foreign market demand caused by the continued industrial development of China, South America and Africa, are literally transforming the marketplace for transformers and related high-voltage switchgear. (read more)

Retail Investment Recovery: Beyond Excess Merchandise Inventory Surprisingly, the retail store industry has long roots in investment recovery. However, participation with the Investment Recovery Association is a relatively recent development in retailers' efforts to manage surplus operational assets for optimum positive bottom-line impact. (read more)

The Customer Service Focus of Investment Recovery Investment recovery (IR) is, above all, a service organization to all groups and subsidiaries of any company. Service to the operating groups and staffs must be the key word. (read more)

Analysis & Appraisal: Establishing Asset Value When asked what I do for my clients, my stock reply has always been, "Manage the orderly disposition of their surplus and idle assets." That includes asset redeployment, sales, donations, salvage, demolition and pay-for-disposal. (read more)

Harness the Power of the Internet Successful businesspeople know that new customers are much more likely to buy from companies they know, and existing customers are much more likely to continue doing business with people they trust. Having a solid Internet presence makes it easier for prospects to get to know and trust you. (read more)

Surplus Asset Identification and FIN 47 Identification of surplus assets, and the subsequent redeployment or sale, can have a significant tax base impact for a corporation. Recent changes in accounting standards and laws were brought about as a result of a failure of corporate managements to exercise their fiduciary responsibilities involving the proper recording of asset values. (read more)

Surplus Asset Identification Investment recovery (IR) represents the third phase of Supply Chain or Life Cycle Management: First, acquire the asset; second, control it while in use; and finally, dispose of the asset. Surplus asset identification is the initial, and therefore, key step in successfully completing that third phase of the materials management process. (read more)

The Value Chain Part III & IV The value chain analysis detailed in the previous issue enables leaders to systematically assess where, how and why their organizations create value for customers, and determine how to increase that value in primary and support activities. Adding value creates competitive advantage, but it's not the only factor in business success. The value chain analysis also helps identify costs to better eliminate them from the value chain. (read more)

The Challenge of Today's Tight Equipment Market Deciding whether to keep or sell surplus and idle capital equipment has always been a challenge, and today's tight oilfield equipment market, where lead times can range from months to years, makes the decision even more difficult. (read more)

How To Put Together a Winning Proposal Corporate Managers are the drivers of the RFP process and, for the most part, know what they need and want. Service providers, on the other hand, are perpetually dogged with the challenge of figuring out what the corporate managers want and how to position themselves as the best option for delivering a project. Definitely not the upper hand in this equation. (read more)

Outsource IT Asset Retirement and Control Liabilities Approximately 1 billion units of computer equipment will become potential scrap by 2010 according to the International Association of Electronics Recyclers. Is now the time for your company to decide how to deal with outdated computer equipment that is currently stockpiled in empty offices and closets?(read more)

The Value Chain Part I & II In investment recovery as in primary useful life asset management, the Value Chain is a sequence of analyses and decision elements that define issues of operating value, risk, opportunity and return for identified assets. Each of the elements in the process chart illustrations has it's own set of detailed considerations for success, or Best Practices. (read more)

Disposing of IT and Electronic Surplus Part II My previous article focused on decision making as to when to dispose of surplus telecommunications, networking and data communications assets. I discussed the issues of "why" you have surplus inventory and why IT and Electronic product is different from other asset disposal challenges. The "why" is the basis for disposal strategy and time is the crucial element here. (read more)

Disposal Options for IT and Electronic Scrap Disposing of surplus IT assets (telecommunications, networking and data communications equipment) presents unique issues and options for investment recovery managers. (read more)

Ensuring Data Security in "Retired" IT Assets With security software spending estimated at $50 billion globally in 2005, information technology professionals are clearly taking the problems of data privacy and identify theft seriously. (read more)

Roundtable Notes: Practical Metals Management Scrap metal works on supply and demand, but other factors such as speculative investment funds have recently impacted prices more dramatically. Funds continue to move the commodity markets up and down with their movement of money in and out. (read more)

Getting the Most from Demolitions & Dismantling Demolition financial decision-making comes down to two main questions: "What do I want done?" and "How much is it going to cost?" Rough answers to the second question are from $0-$2/sq. ft. for steel all the way up to $10-$30/sq. ft. for asbestos-containing material (ACM). To help control those costs, properly prepared bid specifications are key. (read more)

"Personal Branding" Branding influences people. Branding generates an emotional stimulation. People make decisions on emotions, and back them with facts. (read more)

"Using Ebay As An Asset Recovery Tool" IR departments want the highest prices on the sale of their surplus. This is normally achieved with maximum exposure to the most people. eBay, the world's largest Internet auction site, can reach a global marketplace and will certainly broaden the number of potential buyers beyond your own in-house marketing list. (read more)

"Climbing the Corporate Ladder: Discovering the Secret of Upward Mobility" 21 ways to advance yourself up the corporate ladder... (read more)

"Internet Marketing: Building Traffic to Your Website" Great news! It has been well documented that you can dramatically increase business sales if you can attract the right people to your website. The not-so-great news is that there are somewhere between 700 million and two billion active websites on the Internet, making it harder to attract those new customers. So, you must start with a plan, execute it then evaluate it. As General George Patton said, "A good plan today is better than a perfect plan tomorrow." (read more)

"The Ethics of Negotiation" There is great value in deciding what style of negotiator you are... then sticking with the style that makes you comfortable. (read more)

"Trust is a Competency" One of the most significant things today's leaders and organizations can do to achieve and sustain superior performance is to look at "trust" through new eyes. (read more)

"Sustainability and Investment Recovery" Sustainability is an emerging and important aspect of a company's success. You hear about it everywhere in the media - but what is it? And isn't it inherent in Investment Recovery? How should IR professionals approach this concept to help get noticed for what they do in this arena - to ensure that they "get a seat at the table"? (read more)

"Sources of Recovered Assets" When you hear the term "investment recovery," what types of assets come to mind? As supply managers know, the profession involves the management of a wide variety of materials, products and services. The same can be said for investment recovery. (read more)

"Recycling Apples in the Big Apple" If New York City did curbside recycling of computers, its little blue bins would be overflowing. Around the world, in virtually any industry, organizations are being challenged to better manage Total Cost of Ownership (TCO), while being more environmentally conscious. Of particular concern is the pressure to improve the recycling process for obsolete computer equipment, and nowhere was this challenge greater than for the nation's largest school district. (read more)

"Powering the People While Preserving the Environment" From a corporate standpoint, progressive environmental management encompasses all efforts to minimize the negative environmental impact of a firm's products or services throughout the entire life cycle, from "cradle to grave" (Klassen and McLaughlin, 1996). Environmental concerns in purchasing and supply chain management deal with an assortment of issues. (read more)

"Honey Did You Mow the Roof?" What may appear to be an emerging issue has actually been around for a long time—a concern for the planet and its people. What is changing, however, is the ability to affect these issues directly and positively through business management practices. (read more)

"Investment Recovery: Entering the New Age of 'Green'" With social responsibility and sustainability issues facing industry executives, the disposition of assets is a critical matter. More importantly, it's an opportunity to improve the environment and the enterprise. One could argue that asset and investment recovery practices formed the beginnings of the "green movement" before the term came into popular use. (read more)

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