Manage Assets for Smooth Operations

Copyright 2022

As manufacturers look for opportunities to cut costs, equipment downtime is an important area to address. A breakdown, even for just an hour, reverberates through the manufacturing process. It can slow or halt production, leave employees idle, and play havoc with just-in-time delivery schedules.

Be Proactive, Not Reactive

Some manufacturers take a reactive approach to equipment maintenance and repairs. They think, "If it ain't broke, don't fix it." In contrast, top manufacturers use enterprise asset management and perform predictive maintenance. In return, they're able to significantly enhance their machine utilization rate.

Basic asset management involves electronic gathering and interpreting of data to keep plants humming. It includes:

  • Making an inventory of all property and equipment,

  • Monitoring asset use,

  • Logging and analyzing maintenance and repairs,

  • Setting up maintenance schedules to prevent breakdowns,

  • Forecasting when to replace parts, and

  • Tracking contracts, warranties and service agreements.

Having a sound asset management system is like having a crystal ball. You'll know a machine's performance well enough to predict when to schedule maintenance. By doing so, you can prevent a breakdown or replace parts that are wearing out.

For example, one plant implemented an asset management system to cut dependence on equipment redundancies. By shutting down some redundant equipment, downtime dropped from 400 to 90 hours a quarter. Downtime that affected manufacturing dropped from 30 to two hours a quarter. In addition, the ratio of unscheduled to scheduled repairs was reversed. Unscheduled work once comprised 80% of all work orders; now it comprises less than 13%.

Beyond the operational savings and productivity gains from asset management, a well-planned system also guides life cycle decisions. For example, it can help you decide whether to repeatedly repair a piece of equipment, overhaul it or replace it. You'll have solid evidence in terms of the equipment's performance and repair history. This information can be used to develop a procurement strategy based on data and an analysis of products, suppliers and the marketplace.

Cost-Effective Solutions

Historically, comprehensive asset management systems have been out of reach for many manufacturers, primarily due to the heavy initial investment of capital and labor required. Another deterrent has been the difficulty of building an integrated system out of a smorgasbord of specialized software products from multiple providers. It was nearly impossible to find a provider that offers a total package.

In recent years, software manufacturers have been trying to resolve these issues. Their improvements are expected to make asset management systems more widely accessible. For example, a vendor of plant automation software now offers modular, scalable systems that allow manufacturers to start by monitoring one critical piece of equipment and then add modules as the budget allows. As an added bonus, this system is based on an open standard, which gives the user flexibility to add compatible products from other software providers. 

Need Help?

The options for asset management software solutions have evolved dramatically over the years. Systems have become more user-friendly, flexible and affordable than ever before. Contact your CPA to help select a system that's right for your business.