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How to Justify Preventive Maintenance Programs

A good preventive maintenance (PM) program takes planning and usually a lot of hard work in order to obtain approval from management. The return on investment (ROI) for a PM program is often hard to quantify in an accurate figure, especially if the maintenance history of the equipment has not been tracked accurately. If the maintenance history is available, it can help to establish a simple ROI calculation, which can be astonishing to see on paper.

"Many companies still rely on reactive maintenance instead of preventive maintenance. Without the implementation of a good PM program, companies are wasting precious production time and money. The BAHMÜLLER Service Team would like to assist customers to plan ahead and prevent costly downtime and repairs," said a company spokesperson.

BAHMÜLLER is offering a comprehensive multi-tiered PM Program specific to its grinding machine customers in North America. There are three levels for this service:

1. The Basic PM is usually performed every 2,000 hours of machine run time and includes certain part replacements and fluid exchanges.

2. Intermediate PMs are performed every 4,000 hours and include the Basic PM plus additional part replacements (e.g., bellows, etc.) and fluid flushing and exchanges.

3. The Advanced PM is performed annually and includes the Basic and Intermediate PMs, additionally replacing more critical components as well as a machine re-alignment to get the customer's machine back to "Geometric Zero."

Each PM includes items such as well documented checklists, PM spare part kits and customized reports. The PMs can be performed by BAHMÜLLER's professional service techs, freeing up capacity within the customer's maintenance department. These well-trained technicians can also be utilized to expand the capabilities of the customer's maintenance staff with corresponding training programs.

"Day to day manufacturing will always present challenges and obstacles that customers must overcome to elevate their business, reduce operational cost and become more efficient. By implementing such a program BAHMÜLLER enables the customers to keep their grinding machines at peak efficiency and availability, hence performing as the best assets on the production floor," said the spokesperson.

To show the savings or calculate a simplified ROI, only a few figures and four simple steps are needed. The required figures are listed below and can either be gathered from the maintenance history of the asset, supporting departments or even by using an estimated number:

  • Number of breakdowns per year
  • Average labor costs to resolve each breakdown
  • Average replacement part(s) or repair costs per breakdown
  • Indirect costs that are associated per breakdown (i.e., lost profit due to lost production, cost for expedited shipping, fines for non-deliveries to customers, scrap costs, etc.).

The first step is to add these dollar amounts per breakdown and multiply with the number of breakdowns per year. The sum is the annual amount spent on unplanned downtime and maintenance for the specific asset. This number is called the Reactive Maintenance Costs.

Step two is to define the costs of the planned PM program. In contrast to the reactive maintenance, the PM represents planned downtime according to the production schedule and all required parts are commissioned ahead of time with no need for emergency shipments. The BAHMÜLLER Service Manager can provide quotes for specific assets including potential discounts for multiple machines or preferred program packages.

In the third step, the positive effect of the PM program towards the reliability of the machine is considered. Hence it is a repeat of step one using the estimated reduced number of breakdowns per year. For a fair comparison, the annual cost of the PM program of step two needs to be added. The sum of these two numbers represents the total Preventive Maintenance Costs.

Finally, step four is the evaluation of the savings. Subtract the sum of step three from the sum of step one. This number is the Cost Savings per year when utilizing the PM program for the specified asset. The simplified ROI as a percentage can be calculated by dividing the annual cost savings (step four) by the cost of the PM program (step two).

By showing clear and significant returns, this data should be sufficient in convincing management to approve a planned PM program. Besides the obvious reduction in Reactive Maintenance cost, there are many additional benefits in conjunction with PM programs. For example, longevity of the machine itself, increase in OEE, reduced emergency spare parts inventory due to known failure trends, improved morale of associates, etc.

BAHMÜLLER is ready to assist customers in setting up a customized PM program and can provide support from start to finish.

Authored by Bahmueller Technologies, Inc.

For more information contact:

Bahmueller Technologies, Inc.

10815 John Price Rd, Suite A

Charlotte, NC 28273

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