It is All About the Cost!
We have all been there — It is about time to leave for the weekend on a late Friday afternoon,  most of your maintenance staff has already left for the weekend, as you are getting ready to head out, all of the sudden someone runs up to you and says, “We have a problem, one of our assets just failed”. As you hurry off to assess the situation and mentally start thinking of who you can get in touch with to help rectify the situation, you cannot help but wonder to yourself, could this failure have been prevented?

Many people who are involved with the maintenance and operations of critical machine parts know of the benefits of a routine Predictive Maintenance Program and have often attempted to establish a Predictive Maintenance Program (PdM) within their facilities. The problem is, very rarely do the people who know the value of a PdM program have the ability to allocate the required budget to implement a PdM program, and without hard numbers, budgeting for a PdM program can be a hard sell. Here are some ways that one can use to help justify a PdM Program within your facility.

When businesses look at where to allocate their money, they do so with the hope of investing in things that will have the greatest return on investment (ROI). This is understandable because businesses are in business to turn a profit. Oftentimes, others outside of maintenance and operations do not understand the return they will see through a PdM program being implemented. However, with a well-established PdM program, companies can generally see their ROI in less than one year! And, in actuality, the ROI happens more typically within about 6 months’ time. That means the money that it costs to start a program is typically saved by the company within 6 months from implementation.

All plants will have a random failure, but a well-run PdM program will help detect and mitigate many of the potential problems and prevent many unplanned outages on critical assets. Unscheduled downtime is expensive and can result in safety or environmental incidents. Hidden costs from failures can include premium pay, the premium cost for non-stocked spares, and additional regulatory reporting.
Potential savings from a well-run PdM program also include reduced maintenance costs because intervals for periodic preventative maintenance shutdowns can be extended because you know the condition of the machine, and can decide that a PM is not required at the current interval. Also, since machine condition is better known, parts inventories can be reduced and the parts can be sitting on the vendor’s shelf instead of yours.
Put simply, if it costs $1 Million a week to run your plan, a breakdown that results in a plant outage can cost $6000 per hour in downtime plus the cost of repair, overtime, and premium costs of parts not in stock, environmental clean-up, etc. This does not include potential profit from lost sales.

Predictive Maintenance Programs offer the lowest cost with the highest savings for most plants and facilities. With a PdM program established maintenance will be able to detect when an asset is deteriorating ensuring that a spare is ordered and on hand. In addition, the repair can be scheduled during scheduled downtime, so there is no loss in production. In addition, if the company contracts out the PdM program, oftentimes your company can avoid the initial start-up costs associated with starting up a PdM program.

Thanks to our training partner Pioneer Engineering for allowing us to share this article with you.