When the pandemic hit the US and Canada in early 2020, gross domestic product — the broadest measure of economic output — nosedived, at a 31.7% annual pace from April through June (the worst three months, by far, in records dating to 1947). Fast forward to last month, and even with factories regaining most of the ground they lost (the Institute for Supply Management estimates 60-70% recovery), global indicators are not strong.
With economic losses to recover, COVID-19 restrictions to address and historic supply chain instability to monitor, the impact of downtime on business operations is more significant than ever.
Downtime in Focus
In the industrial sector, downtime is already a multi-billion-dollar problem. While the metrics shift a bit from business to business and industry to industry, a study by the International Society of Automation estimated that downtime collectively costs facilities nearly $650 Billion each year.
Broken down, the numbers are just as disconcerting. In 2016, consulting firm Aberdeen estimated the average cost of downtime across all industries was $260,000 per hour. In some sectors it can be considerably worse. In the auto industry, for example, estimates for downtime run as high as $50,000 per minute – that’s $3 million per hour.
Even in normal conditions, facilities lose anywhere from 5% to 20% of their productivity due to downtime. In the current environment, where productivity is already off due to line reconfigurations for social distancing, personnel shortages due to sick workers, safety and cleaning rituals, and other operating complexities, operators cannot afford any more of it.
At a time of great uncertainty, when facility owners are already dealing with reduced profits and demanding protocols, it is critical for facilities to increase their focus on MRO (maintenance, repair and operations) efficiency and in particular, reducing downtime.
The Partner that Pays Its Own Way
Per an August 2020 research report, the value of MRO efficiency has increased, not diminished, in recent years. It not only reduces downtime; it increases the ROI of equipment throughout its usage. From a broader perspective, it can reduce operational expenditure substantially through process efficiency and optimized supply chain management, two imperatives for surviving this era.
One of the most well-documented mechanisms for MRO efficiency – and reduced downtime – is preventive maintenance. Like most other plant operations, ongoing personnel challenges can complicate preventive maintenance. Nevertheless, research shows that it pays for itself, many times over. Per a study by the PMMI (Association for Packaging and Processing Technologies), preventive maintenance can return a jaw-dropping 545%, over time, on the initial investment.
Boosting Preventive Maintenance – and Uptime
Tero’s decades of experience in this area have proven that preventive maintenance programs are most successful when administered with the help of a computerized maintenance management system (CMMS). A CMMS makes it easier to manage assets, facilitating inspection and repair – and reducing downtime to the bare minimum.
CMMS systems like Tero’s Azzier empower technicians with powerful insight, enabling teams to better manage, predict, and optimize their assets. These capabilities also enable operations to play a positive role in advancing the firm’s financial outcomes. At Tero, we are dedicated to helping your company avoid downtime during this period of business uncertainty. Our complimentary situational evaluation will get you started. To schedule a discussion, call Tero Consulting at 1-866-818-8376 or email email@example.com.