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[Asset] Maintenance is Forever!

Posted under Blog by Nick Leonard, Growth Marketer

April 10, 2019 (Updated April 13, 2020)

Maintenance is Forever, But Maintenance Goals Change

Setting maintenance goals is often easier said than done. Maintenance is forever, in that you will always need to maintain assets based on breakdowns, perform preventive maintenance tasks, and for safety reasons.
 
Even when an asset reaches the end of its useful life, it will be replaced in some form or another with a new piece of equipment that will also require maintenance.
 
 Maintenance is forever, and so are maintenance goals. Every piece has to fit together for a maintenance department to effectively contribute to profit optimization.


Maintenance is forever, and so are maintenance goals. Every piece has to fit together for a maintenance department to effectively contribute to profit optimization.

 
Maintenance never actually ends from the perspective of an organization – it merely gets adjusted to fit ever-changing business needs. This is part of why setting maintenance goals can be a challenge. The obvious goal (maintain all equipment in optimal condition) has no endpoint. You will be doing this forever, so it’s not a goal that you can actually reach. It would be more reasonable to state a goal of attaining certain key performance indicators (KPIs) that you can work towards. These are maintenance goals that can be worked towards and therefore eventually achieve.
 
We should take a moment to draw a distinction between performance goals and business goals. Performance goals can often be drawn from the aforementioned KPIs. For example, ensuring that all work orders on critical production equipment are completed in a timely manner would be a performance goal. Ensuring a preventive maintenance program is followed also falls under performance goals.
 
Business goals are somewhat different. These are not strictly related to measuring the performance of the maintenance department. Business goals instead hinge on supporting the overall business. For maintenance, just like other departments, this often comes down to profit optimization. You can consider this an overriding goal that will, just like maintenance, last forever.
 
Your other goals are certain to change over time, but this one overriding goal will not. In fact, it’s very like the broad performance goal we noted earlier about maintaining all equipment in optimal condition!
 
Just like with your performance goals, this means you’ll need to break it down into achievable steps. We can start on this by looking at some of the challenges that maintenance must overcome if they want to contribute to profit optimization.  

An article by Ralph Peters, “Maximizing Maintenance Operations for Profit Optimization:  The Journey to Maintenance Excellence,”  highlights four interrelated challenges that face maintenance organizations all around the world:

  1. Maintain existing production assets and facilities in safe and sound conditions.
  2. Improve, enhance, and then maintain existing assets and facilities to achieve environmental/regulatory standards, greater production capacity at better quality and while using the best energy practices.
  3. Enhance, renovate and modify/overhaul existing assets/facilities using capital funds from tenant/customer and then maintain the additions.
  4. Commission new production assets or facilities.

Without diving too deep into the above (as these are covered quite thoroughly in Peters’ article), the takeaway here is that there will always be maintenance to plan, perform, and improve upon – and that is especially true of asset-intensive organizations, thus making maintenance a forever practice. 

Maintenance Operations Image

 

The fact that ‘maintenance is forever’ means that companies need to figure out new ways to plan, perform, and improve their maintenance practices, which when done properly will help with the overall profit optimization of an organization.

Let’s take a quick look at profit optimization and how maintenance fits in.

Maintenance & Profit Optimization

Profit optimization is finding an alternative with the most cost effective or highest achievable performance under the given constraints, by maximizing desired factors and minimizing undesired ones. In comparison, maximization means trying to attain the highest or maximum result or outcome without regard to cost or expense.

Maintenance must be included in the overall equation to achieve profit optimization.

Rarely is maintenance seen as a way to improve the bottom line. More often than not, it is deemed a cost-center and something that “must be done.” 

For maintenance to truly contribute to a company’s overall profit optimization, there must be alternative (new) ways to perform maintenance under the current (given) circumstances in order to maximize resource utilization and output at the lowest possible costs. 

With advancements in technology and continued research into historical data, many maintenance organizations are beginning to realize that intelligent maintenance can actually drive profit.

Maximizing Resource Utilization

We’ve talked a lot about maximizing resource utilization in previous blogs so we will maintain the focus here on how maximizing resource utilization can help with profit optimization. 

The premise is quite straight forward actually – if you are maximizing your resources (people in this case), you are ensuring that there are little to no wasted labor hours. 

Wasted labor hours = wasted money, which takes away from the bottom-line, thus affecting profit optimization for the entire company. 

And while the premise may be quite straight forward – actually maximizing resource utilization is not so simple. 

The first place you need to start is with the actual planning of the work itself. 

Making sure that you have the proper resources available at the time the work needs to be completed, as well as a number of different factors such as any permits that may be required, parts and tools to complete the job, and more. To learn more about planning best practices, check out our White Paper here.

Maximizing Output

Maximizing output and profit optimization go hand-in-hand. 

The more that you are able to produce, the more revenue that can be realized from that production. And, in order to maximize output, not only do you need to efficiently plan and utilize resources, you need to ensure that the downtime of output-producing assets is minimized. 

A decrease in downtime leads to an increase in uptime, which leads to more output and more revenue, which helps to drive profit optimization. 

If your assets are consistently breaking down and not being fixed in a timely manner, then it will take you much longer to reach your production goals, ultimately affecting profits. 

One way in which companies are combating downtime is by moving from a reactive maintenance strategy to a predictive maintenance strategy.

Controlling Costs through Maintenance

One of the biggest ways in which maintenance can play a role in positively impacting profit optimization is by reducing the cost of maintenance at the organizational level. 

Maintenance is inevitable.  As is the point of this blog, maintenance is forever.  It has to happen.  And, while cutting resources or only conducting maintenance when something has broken down may save you money in the interim, it is not sustainable especially when talking about profit optimization. 

Cutting the maintenance budget and the number of maintenance people will save on costs initially but will have adverse effects in the long-run. 

Putting measures in place to go from a reactive maintenance strategy to a predictive maintenance strategy will help to control maintenance costs by eliminating unplanned downtime and maximizing resource utilization.

Maintenance isn’t going anywhere.  So, rather than disregard it, make it a part of your overall strategy to help drive profit optimization.  To learn more about controlling your maintenance costs, you can access our White Paper here.

“Organizations that clearly understand that “Maintenance is Forever” and find the key to balancing all resources toward optimum total operations success will succeed in the 21st Century.” – Peters

To learn more about how VIZIYA can help you improve your overall maintenance strategy and processes, click here to talk with one of our experts.

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