How to calculate the life cycle cost of equipment & the benefits of requesting new equipment to avoid costly unscheduled downtime

Life cycle cost (LCC) is an extremely useful analytical tool to help minimise waste and optimise energy efficiency, especially when incorporated into a fully customised computerised maintenance management system (CMMS).

Background: life cycle cost calculation

The US military devised the concept of life cycle cost. It was so logical and accountable, that it was adopted by other government departments and eventually adopted by big business. The U.S. Department of Energy’s definition of LCC,

“the sum of all direct, indirect, recurring, nonrecurring, and other related costs incurred in the planning, design, development, procurement, production, operations and maintenance, support, recapitalisation and final disposition of real property over its anticipated life span for every aspect of the program, regardless of funding source.”

Why you need to calculate the life cycle cost of equipment

As modern businesses have substantial operational plants and large pieces of equipment, it’s imperative to manage all your assets correctly in terms of productivity and safety.

Life cycle management is an important part of the tendering process. It helps determine how to get the best value from a new piece of equipment.

For example, your experience tells you a new widget would make the factory more productive. However, senior management won’t sign off on the request.

You instinctively know retaining and maintaining the old equipment is not worth the expense, but you need concise information and facts to present to them. A detailed life cycle cost analysis will be able to show management the benefits of the upgrade. This will enable management to make decisions with confidence, with all the figures visible.

Benefits of a life cycle cost analysis

When pitching to management, you will be able to provide detailed pros and cons of upgrading compared with the costs of retaining, based on the life cycle cost analysis of:

  • Age
  • Condition
  • Frequency of breakdowns, and
  • Cost of breakdowns

If the production line is breaking down, you’ll be able to explain to management why.

You can confidently outline recommended solutions, present projected costs and show long-term return on investment – management will see the value in your recommendations.

A life cycle cost analysis will help you make sound buying decisions, and avoid making mistakes twice.

3 life cycle cost considerations

When calculating equipment life cycle costs, three areas need to be analysed:

  1. Past scheduled work
  2. Reactive maintenance costs
  3. Forward projections

Each data set gives you important insights and takes the guesswork out of decision-making.

1. Past scheduled work

This determines the criticality of an asset. Even if it is an inexpensive part that no one notices, if it stops everything else, it is critical.

The criticality of past scheduled work covers:
  • Cost of parts
  • Labour
  • Consumables, and
  • Downtime

2. Reactive maintenance life cycle costs

When you react to a breakdown, in addition to the cost of lost productivity (particularly if it is a critical piece of equipment), you also have to account for the hard costs of parts, labour, and consumables.

It’s important to keep an up-to-date log of work orders/ work requests because if there is no system, there is no knowledge.

Downtime is even more important in terms of reactive maintenance; because it is unplanned, it has an even more significant impact.

You cannot project ‘Murphy’s Law’ forward, but a failure analysis, such as reporting on two similar but different pieces of equipment can provide invaluable insights.

For example, a manufacturer will say a piece of equipment has a two-year MTBF (Mean Time Between Failure) rate, but what is the ACTUAL rate in your particular environment looking backwards, as a result of your specific conditions (eg dusty, hot, humid, etc)?

Knowing this can make a tremendous difference in decision-making, and take out much of the guesswork.

3. Projecting life cycle costs forward

It is difficult to project forward manually, as it is very labour-intensive, which is no doubt why maintenance managers keep putting it off.

A proven CMMS such as the one offered by MCGlobal Solutions lets you define maintenance schedules in the system and project annual maintenance years in advance.

In terms of reporting, it will give you a clear, concise summary and help you put forward a compelling business case – complete with any up-spec or superior performance figures the proposed new equipment will bring.

For more information and advice about calculating the life cycle costs of equipment, please contact our highly experienced team at MCGlobal Solutions, simply click here to contact us.

 

Investing in a Computerised Maintenance Management Systems Health Check Regularly is Important for Operational Efficiency.

Many MCGlobal Solutions customers have taken the opportunity to use our Consultants to have a look under the bonnet of their CMMS to find out how well they are running.

Whether it’s a matter of finding the time, committing resources or the cost involved, many people treat getting an expert in to look at their Asset Maintenance Management the same as booking their car in for a service.

MCGlobal Solutions Consultants have been carrying out CMMS Health Checks for many of our long-term customers over the last few months. It has brought to light both minor and major changes that can be made to bring their systems back to best practice and enhance business operations.

Three factors were consistently identified as influencing system usability.

 

1. Staff changes

When trained staff leave the company, or their role changes, a knowledge gap is often created. New staff are not trained in, or made aware of the importance of system operation and as a result, will try to teach themselves or avoid using the software completely.

While Maintenance Connection (MC) is one of the most user-friendly Computerised Maintenance Management Systems (CMMS) packages to learn, with printed and online tutorials available, there is always the fear of the unknown which will hold people back.

2. Unclear workflow process.

As businesses grow and people’s roles change, there should be regular reviews of how the current workflow process is operating and whether it can be improved.

New staff roles, advances in the MC software and the addition of new hardware may result in a more efficient method of operation.

There is also the need to ensure that ALL technicians and administration staff are entering ALL the required data to maintain the data integrity of the CMMS.

3. Poor identification of assets, classifications, PMs and procedures.

During the initial implementation process, an identification and naming convention is created by the Consultant to ensure consistency, reliability and predictability. When new data is added to the various modules, adhering to these protocols will maintain consistency in reporting and identification.

As with all staff capabilities and proficiencies, the administration needs to ensure the understanding of the operation and modules within the CMMS is kept up-to-date. This can be either through regular, annual refresher courses by the MCGlobal Consultants or targeted training when new key staff are employed.

Benefits of a CMMS Health Check

The benefits of a CMMS Health Check are to ensure best practices are being followed, all staff are correctly trained and your business operations are running at peak efficiency.

Ready for a professional assessment of your CMMS operating health?

Contact MCGlobal Solutions for more information about what this process might involve for your company.

Remove the pain points of Maintenance Work Requests

Remove the Pain Points of Maintenance Work Requests

One of the best and worst things about being a Maintenance Manager is being so ‘popular’. Everyone wants a piece of you and, as you know, everything is urgent- at least to their way of thinking. When was the last time someone called you and said “No hurry on that work order request, take as long as you like.”

Of course, what might seem ‘red hot urgent’ to the person with the problem, may not be quite as urgent in the scheme of things as they might think.

Everyone has their own agenda and being the person in charge of maintenance issues, you play a key role in managing expectations.

Pain points associated with Work Order requests:

  1. Time lost in searching for unrelated information, and sifting through mountains of paperwork
  2. A loss of momentum, as one job comes straight over the top of another, and
  3. The feeling of being totally overwhelmed by the volume of work requests.

With this in mind, MCGlobal Solutions can provide proven ways to take the chaos out of maintenance work order requests.

Managing Maintenance Work Requests in 3 Steps:

Operations Management and Asset Maintenance

1) Conduct an Asset Criticality Assessment

Of the 200 or so work order requests that could be on your radar, not all of them will be critical.

The first thing to do is conduct a Criticality Assessment of the assets, prioritising all work requests.

Only those items requiring Statutory Compliance and/or impacting health and safety– such as checking for Legionella in a commercial HVAC system – are truly critical.

If it impacts a client experience, for example, a tap dripping at night in a hotel guest’s room or air conditioning not working in a shopping centre, its criticality is slightly lower.

The main advantage of a criticality assessment:

  1. It uses an established filter
  2. With predetermined criteria

It saves you from having to agonise over what risk level a task falls under by having criteria set. And it prevents you from going through the same process a few weeks later with a similar project.

If it ticks the box as critical, based on the predetermined criteria, then it automatically gets priority.

This will reduce the daily influx of work orders that must be dealt with immediately down to a more manageable figure.

2) Determine available resources

Once you have ascertained the criticality of work orders in descending order from “must do” to “wish list”, it is then a case of working out if you have the right resources on hand to confidently and competently do the work.

As you know, these resources are often interdependent.

For example, having the LABOUR to complete the task, in terms of supervisory staff and trades staff.

If the workforce is available, do you have the parts to complete the work?

If certain PART are not on hand, what is the timing for supply so the work order can be re-scheduled?

Also, you must consider the TOOLS and EQUIPMENT required for the task. You might have access to labour and parts, but if your team is on a mining site a piece of equipment might be 100kms away.

3) Consider physical access

This is where you need to look at the big picture, such as:

  • Is it safe?
  • Is it in use?
  • Is there other work going on that would prevent getting access? (Eg you need to paint, but earthworks are making the site too dusty)
  • Do other jobs require the same resources?
  • Can we schedule around regular maintenance?

This process can be stressful unless you have the right Computerised Maintenance Management System (CMMS) in place, one that will consider each and every facet of the job and give you a red or green light.

Our tailored CMMS will make short work of your work orders.

MCGlobal Solutions can configure the CMMS guaranteed to meet your specific industry challenges.

The system will be set up to effectively track, analyse and manage every component of your maintenance management operation, and;

  • give you an instant update on your real-time inventory,
  • increase efficiencies across the entire asset lifecycle
  • assist with better work scheduling,
  • improve the safety and reliability of your assets,
  • and much more.

Want professional advice about how to streamline work order requests?

Contact MCGlobal Solutions for more work order best practice information and professional advice tailored to your industry – Book a Demonstration

Synergy-Partner-Awards- MCGlobal Solution Most Innovative Partner Award

MCGlobal Solution receives Accruent Most Innovative Partner Award

Why is it Beneficial to Implement an Enterprise Asset Management Plan for your Maintenance Teams + What to Consider When Formulating the Framework

An Enterprise Asset Management Plan should be implemented regardless of how “aged” your assets are.  The Enterprise Asset Management Plan sets out what your desired level of service will be and provides this service level in the most cost-effective way.

The 5 major benefits of an Asset Management Plan

  1. Prolonging the asset life through efficient and focused operation and maintenance
  2. Meeting customer demands and expectations
  3. Budgeting and efficient use of resources
  4. Meeting service expectations
  5. Complying with regulatory requirements

What to consider in your Asset Management Plan

1. What is your current situation?

An extremely important first step to building the framework for your Enterprise Asset Management (EAM) Plan is understanding our assets.

  • What assets do we own? (Do you have an asset register?)
  • Where are the assets located?
  • What condition is each asset in?
  • What is its useful life?
  • What is the value of each asset?

2. What is the required level of service?

  • What level of service do the stakeholders demand? (Is it ok for the asset to be “down” for a period of time or is the item a “critical” asset)
  • Are there regulatory requirements?
  • What is the current actual level of performance? (Not what we think the performance level is, what it actually is)
  • What is the asset capable of? (Is it running at optimal speed/performance or has it been slowed down to save it?)

3. What are my critical assets?

  • How can the asset fail?
  • How do the assets fail?
  • What are the likelihood and the consequences of the asset failing?
  • What does it cost to repair the asset?

4. What are my life cycle costs?

  • What strategies are suitable for my organisation? (Predictive, Preventative, Run-To-Fail)
  • What would the costs be to maintain, repair, refurbish or replace the asset over the expected life of the asset?

An Enterprise Asset Management Plan is not a static document. Once you have formulated your framework, the components must be reviewed as situations change over time, or new best practices are established.

Interested in unlocking the full potential of your EAM?

Let us demonstrate what we can do for you, as it is never too late to formulate a quality Enterprise Asset Management Plan. Book a Demonstration.


Enterprise Asset Management Series

Next in our Enterprise Asset Management (EAM) series, we discuss some common issues in the industry and some best practices to get your EAM/CMMS running up to speed – The System Health Check

 

 

MC Global Solutions Asset Management and Maintenance Software Solutions

Best Practices to Establishing System Naming Conventions

“A little forethought at the start can save a lot of time in the future.”

It is advised as a best practice to build a strong naming convention and protocols during the initial setup of the Computerised Maintenance Management System (CMMS). This will make it easier for workers to get used to using the Maintenance Connection modules. By employing a consistent and logical format, the explorer lists will naturally group listings to simplify the look-up and search process.

There are five modules where this is particularly relevant

  1. Assets
  2. Inventory
  3. Classifications
  4. Procedures
  5. Preventative Maintenance

1. Assets

As assets are often added, modified or moved within the asset tree, the ID and name need to contain sufficient information to make them identifiable without requiring them to be altered if modified or moved. The ID can often incorporate the classification or unique numbering associated with that asset. The name should start with a general description followed by increasing levels of refinement.

Asset ID and name example

Asset ID: GENDSL200-026

Asset Name:  Generator, Diesel Standby 200KVA Siemens

Always make allowances in the ID for future additions and larger sizes. In the given example, -026 was used in preference to -26 as there is the possibility that there may be more than 99 Generators in the future.

2. Inventory

Inventory/stock items can number into the thousands for many companies.

The ID and naming of these need to be standardised to allow

  • efficient searching for a part,
  • removal of duplication from non-standard descriptions,
  • sufficient descriptors to avoid ambiguity, and
  • new items to be added that match the existing naming convention.

Often the inventory ID is not related to the description of the item, but rather a simple indexed number matching a barcode. A defined number of numerals/letters is valuable in keeping inventory in order.

Inventory ID example

Inventory ID: FIX1003456

Inventory Name:  Bolt, M16 x 100 SST

Inventory ID: MTR040403F

Inventory Name:  Motor, 4KW 4Pole 3PH 415V Foot Mount

The name, however, should follow a noun-adjective protocol. It can also include manufacturer or model details in situations where this is relevant to the correct selection.

3. Classifications

In several major industries, some standards can help in creating a set of classifications. Reporting and analysis can be enhanced by having major classification groups, these can then be broken down further into more specific descriptions.

In the International Standard for the Petroleum, Petrochemical and Gas industry ISO 14224, they used a four-letter abbreviation to group and sort classifications

Classification naming convention example

COAX = Compressor (CO) – Axial (AX)

VESE = Vessel (VE) – Separator (SE)

A similar convention can be used by incorporating the same or more letters or numbers for other industries which do not have existing standards.

4. Procedures

Avoid creating duplicate procedures and easily identify all applicable procedures when updates are required by using the classifications in the procedure and preventative maintenance ID.

As the procedure can either relate to a time or meter-based interval, or an unscheduled type of repair, the ID and name need to be flexible enough to allow for all variables.

Procedure naming convention example

VESE-M48-M-30  = Vessel, Separator 48-Monthly Mechanical Internal & External Inspection

VESE-X01-M-01 = Vessel, Separator Recoating of Corrosion Protection

5. Preventative Maintenance

The classification can be incorporated into the preventative maintenance ID and the name. A similar protocol can be used, with the main variation being the inclusion of the asset within preventative maintenance.

Preventative maintenance ID example

PM-VESE-M-COMPSTN-01 = Vessel, Separator Mechanical Service Compression Station 01

Contact us for a free demonstration

For more information and advice about Maintenance Connection CMMS, please contact our friendly and highly-experienced team at MCGlobal Solutions. We can arrange a free demonstration of our asset management software based on your specific issues.

 

Contact Us

Are you using Enterprise Asset Management Best Practices?

It’s easy to fall into the habit of using your Computerised Maintenance Management System (CMMS)/Enterprise Asset Management (EAM) system for your ‘favourite problems’ on a day-to-day basis. However, establishing Asset Management Best Practices has many benefits for you and your team.

Can your powerful CMMS/EAM system do more for you?

CMMS systems are a bit like our brains. We know it’s incredible. We know it can do amazing stuff, and yet we only use 10% of it. What if you could unlock that extra 90% of your CMMS/EAM system?

Imagine the difference to your workplace if you could unlock the other 90% not being utilised… or perhaps not utilised very well…  and ensure you are implementing best practices every step of the way.

No more putting out those daily fires. No more Post-It note ‘must do’ (when you have the time) and no more frustrated inter-department emails because something slipped through the cracks and in some cases, created (predictable in hindsight) downstream issues.

 

Learn new ways to use your CMMS/EAM software and outline your Asset Management Best Practices

Your role as an operations manager is complex, and it is difficult to find the time to learn how to get the most out of your investment in a computerised maintenance management system. Or to figure out whether you could be using it better to implement best practice strategies and take more of the load off your shoulders.

See if these questions start you nodding…

  • Do you and your department get blamed for constant breakdowns?
  • Have inefficiencies started to creep into your CMMS/EAM system?
  • Have your preventative maintenance schedules become too complex?
  • Is your asset data incomplete?
  • Are you missing opportunities because the system just isn’t coping?
  • Are there complaints, tantrums, walkouts, picket lines, news reporters, and lawyers??? Ok, ok. So things haven’t become THAT drastic!

The good news is you are not alone. It’s more common than you might think for operation and maintenance managers at a large facility to have a powerful CMMS at their fingertips — but not have the time to make the most of its functionality.

If your system is not running at optimum efficiency, it could be time for a CMMS health check

Without your CMMS/EAM system running at optimum efficiency, things start to fall apart. So, it might just be time for a full review of your CMMS/EAM system.

A CMMS health check scan will identify:

  • What percentage you’re effectively implementing and
  • What is yet to be ‘switched on’ or integrated

Regardless of whether you are using a CMMS, or a manual system, there’s nothing like a fresh pair of expert eyes to help you see where and how you could be saving time, and getting more done in an easier manner. For example:

  • It could be appropriate naming protocols haven’t been used or adhered to.
  • Or classifications are too general — or haven’t been assigned correctly.
  • Maybe incremental errors have occurred as a result of scheduled PMs not being set correctly.
  • Or if labour records are not being kept up to date, there might be discrepancies in staff and contractor’s licenses, qualifications and competencies.

All small things, but all with potentially serious ramifications.

A health check of your system enables a CMMS/EAM consultant to take a good look into:

  • How your daily workflow operates,
  • Review your current methods and procedures, and
  • Identify opportunities for future improvements.

Valuable insights can be gained from an ‘outside’ professional analysing your system.

A health check analysis can quickly identify:

  • Deficiencies,
  • Improve efficiencies,
  • Help to optimise your CMMS/ EAM and
  • Make your job a lot easier, by simply discovering what’s working, what’s not and what to do about it!

A fresh set of expert eyes from a professional consultant can pinpoint errors, detect problems waiting to happen, help prevent future issues and suggest Asset Management Best Practices.

What should be included in a maintenance management system health check?

  • It must examine your current processes and study your present management systems within the CMMS/EAM.
  • It should be non-obtrusive. You can’t afford downtime, so consider conducting a health check in your quiet(er) period.
  • While some preliminary work can be carried out offsite, it’s best to conduct the assessment with the system administrator, supervisors and maintenance staff in attendance to ensure input is received from all involved.
  • A thorough system health check should generally take 2-3 days for medium-sized customers with CMMS/EAM systems. This can vary depending on the size and complexity of your system.
  • A comprehensive, in-depth report should be included. It would provide a full appraisal of your current situation, as well as recommendations for improvement, plus details of benefits you’ll enjoy as a result of implementation if required.
  • IMPORTANT: The health check should be conducted by a consultant from a technical background… not a salesperson!

Your CMMS/EAM health check report

The report is back from the ‘doctor’ on the health of your CMMS/EAS. It might require a little minor surgery, or it may just be given the all-clear. If there are a large number of potential safety and efficiency gains identified, it could be time to look at the business case for an upgrade to a more capable system.

Whatever the outcome, at least you will know where the opportunities are, and what you can do to capitalise on them.

We’d love to help you make the most of your EAM/CMMS

Like you, we care about managing preventive maintenance. Let us run a full System Health Check on your CMMS/EAM system.

With the report in hand, you can implement any or all recommendations yourself, or engage MCGlobal Solutions to do it all for you if you prefer.

Your health check will streamline your system and make it more efficient than ever. You’ll have peace of mind, and you’ll know that you are making the most of your investment in your EAM/CMMS.

For more information about Enterprise Asset Management systems, or advice on specific problems and challenges you are facing, please call MCGlobal Solutions on (07) 3303 0177 or click here to contact us.

Space Management Solutions | MC Global Solution

Facility Managers 3 Step Guide to Maintenance Scheduling

As businesses grow the scheduled maintenance process becomes more complex, and it is exponentially harder to:

  1. achieve maximum productivity;
  2. contain operational and maintenance costs;
  3. have clear, concise reporting of maintenance activities.

Our guide to maintenance scheduling will demonstrate how Enterprise Asset Management (EAM) software streamlines workflows and keeps facility managers in complete control.

With an ever-growing list of scheduled maintenance tasks to perform, and a growing number of reactive maintenance jobs coming in, it becomes increasingly difficult to keep all the balls in the air, and plates confidently spinning.

Even experienced facility managers sometimes struggle to prioritise problems that invariably arise, such as maintenance schedules, labour resources and use of equipment. Ask yourself:

  • Have I got the inventory to complete the job?
  • Will issues have a flow-on effect through the organisation?
  • Does this satisfy statutory compliance?

With this in mind, here are the three basic steps to scheduling a job to make your working life so much easier. Plus, it will help you get the best return on investment (ROI) from your assets.

3 step guide to maintenance scheduling for facility managers

Step 1: Step back and look at the big picture

Criticality assessment

Before you schedule a maintenance job, enterprise asset management best practice strongly recommends you conduct a thorough criticality assessment. If you do not perform a criticality assessment to identify your most critical assets, you will base your decisions on perception rather than risk. This may result in wasted time and money.

For example, if a production line stops, due to something relatively small that could have been avoided, then the downstream impacts of production, deadlines and deliverables can become significant.

The key is to look further than the actual equipment itself, and determine what is depending on this equipment.

Establish priorities

All businesses have their own terminology/criteria to rank priorities; some use a colour system (such as red, amber and green), and others a 0-10 numerical system (with a ranking of “10” deemed to be highly critical).

Basically, it comes down to this:

  • Is it critical
  • Urgent
  • Normal
  • Low

In a perfect world, everything would be low-to-normal, but unless you’re super-efficient (or very lucky) this is rarely the case.

Once you have conducted your criticality assessment, and determined priorities, it is then a matter of working out how to track all of these issues so you can handle work requests with confidence.

Rather than struggle with spreadsheets (or sticky notes), a proven asset management system will keep you up to speed with every stage of every job.

MCGlobal Solution’s CEO, Steve Martin says:

“If this type of activity isn’t systemised, then the risk to the business is very high. Information in people’s heads can so easily be lost.”

When setting priorities to make sure non-urgent, yet time-sensitive maintenance work is not pushed to the back. For example, if the air conditioning is due to be serviced within a fixed period, failure to do so will infringe on Code compliance. Therefore, this will need to be slotted into the priorities list in a timely manner.

Having automatic alerts in your asset management system is a valued resource. It means any important, time-sensitive maintenance tasks won’t be overlooked.

3 step guide to maintenance scheduling for facility managers

Step 2: Assign your procedures

After looking at the maintenance work to be done and determining its criticality, your next step is to assign your procedures list.

In this step, you assign who does what – with unambiguous information about how it needs to proceed, when it needs to be done and who to pass the ball to once each process is carried out.

When assigning procedures attach documents

  • Standing Operating Procedures (SOP)
  • Safety instructions
  • Photos (if necessary/available)
  • and anything else that may relate to the job.

This documentation is particularly important because it ensures everyone is on the same page and all procedures are covered off. For example, if there are safety factors to consider such as if and when the power needs to be turned off (and back on again) during a maintenance job.

A procedures list provides valuable intel, such as

  • determining if there are any site induction requirements;
  • ensuring the correct parts are being ordered;
  • deciding if risk assessments need to be undertaken;
  • and so forth.

Ideally, to avoid double handling, this would all be carried out on a ‘click and done’ basis, with EAM software that seamlessly integrates with your operations. With the right facility asset management system in place, you’ll know instantly when things should happen.

Avoid potential problems

  • Stakeholders must be totally clear on “what’s next”.
  • The right people must have access to information as they need it.
  • Approvals/checkpoints must take place before the next step is taken.

3 step guide to maintenance scheduling for facility managers
Step 3: Implementation

Provided you’ve followed the first two steps involved in scheduling a maintenance job, this final step should be simple to implement, especially if you have an Enterprise Asset Management (EAM) system to coordinate everything.

It involves checking job calendars to see what other work is happening concurrently; depending on the workload, this may dictate the assignment date and/or the labour chosen to complete the task.

With an EAM system in place, it will immediately show you which people with the right skills are available. Furthermore, it will then automatically send out notifications to:

  • The people doing the job
  • The job requester
  • Other stakeholders

Enterprise Asset Management System

Sectors from healthcare to hospitality, and from manufacturing to retail, that follow these three steps will be improving operating efficiencies.

A proven enterprise asset management system will show who is doing what work orders now, and what is scheduled in the coming months.

You’ll have a total asset register, a failsafe inventory system, access to accurate recordings, and enjoy measurable results from an EAM software system with the utmost functionality.

For more information about enterprise asset management systems, or advice on specific problems and challenges you are facing, please call MC Global on (07) 3303 0177 or click here to contact us.