When your assets are running smoothly, no one notices. However, when assets go down, everyone is looking at you to get things back up and running. You lose revenue and time, not to mention all the employee productivity.
According to Aberdeen research group, on average downtime can cost companies $260,000 per hour.
That’s why it’s important to know how to measure, track, and reduce your unplanned downtime.
What is equipment downtime?
Equipment downtime is essentially any period of time that a piece of equipment is not working or producing. Downtime can either be unplanned because of a breakage or defect or planned in the case of scheduled or intended maintenance activities. Downtime generally refers to unexpected downtime which stops production.
How to calculate equipment downtime
There are two main methods of calculating downtime: lost time and lost revenue. Each of the is calculated using your equipment downtime log. In ManagerPlus this allows you to record the time that an asset was down and report on it.
We go over both and why you would use each.
The first way to measure your equipment downtime is in actual time. For a given asset (or set of assets), record the amount of time during each month that the asset is broken down. Keeping a running tally and comparing it to past months will help you know when an asset is having more issues than normal. Comparing the asset’s lost time with other assets will show which assets are breaking down more than others.
Lost time is calculated as a percentage of all time that the asset is in use. This will typically be your organization’s hours of operation each day. So, for example, if your facility is in operation for 8 hours/day, 20 days/month and a particular asset is down for one day during the month (8 hours), then the downtime on that particular asset is:
This should be calculated for all assets and averaged. You can then compare individual assets against this average to see which assets are doing well and which could use improvement.
Now, lost time may not mean much on an asset like an elevator or light fixture. Redundancy makes those assets less than critical to daily operations. So how do you know which assets are critical? Which equipment downtime is the most important? With the second measure.
The second way to measure the impact of your downtime is through lost revenue. This will help you determine which assets are the most critical to your operations.
For a given asset, determine the amount of revenue that is lost if that asset goes down for an hour. For example, if an elevator goes down, production lines and revenue remain the same. Almost no revenue is dependent on a single elevator. However, if a processing machine goes down, it can halt the production of an entire production line, leading to the loss of all revenue from that line while it is down.
Determining the lost revenue per hour will clearly show which assets are critical (with the highest lost revenue per hour) and which have the smallest effect on your operations.
It is important to know that lost revenue is not the only way that machine downtime costs your organization. This figure does not include the lost productivity of your employees, who will still need to be paid, despite being unable to work.
What is planned downtime?
Planned downtime is when you intend to bring your equipment offline for the purpose of inspecting or repairing it. Every asset your own will need maintenance at some point and planning the work in advance for your more critical assets will need keeps them running longer.
Planned downtime is a crucial part of any preventive maintenance strategy which is the most effective way to maintain your more complex assets. As part of a preventive maintenance strategy, your enterprise asset management (EAM) software can anticipate when equipment will need maintenance based on usage time, the condition of the equipment, or any other metrics you define.
One of the biggest benefits of planned downtime is that you can schedule it at the most convenient times for you. If you have a slower time of the month or year, or if other assets in the system will have to be offline for some reason, you can plan the downtime when it least effects your output.
The main goal of planned downtime is to preempt and prevent much more costly unanticipated failures that could have a much larger impact on your company.
How to reduce equipment downtime and increase productivity
Now that you know how to calculate how much your equipment downtime is costing you, let’s look at ways of reducing it. This will include using failure codes to identify where the downtime is coming from, and reducing the mean time to repair to reduce, or even eliminate downtime.
The first thing you should be using is failure codes on your work orders. These are codes that indicate why the asset went down in the first place. These can include many things, but should at least include the following possibilities:
- User Error (sometimes called Abuse)– The failure happened because someone used the asset incorrectly.
- Failure to Perform PM – The failure would have been prevented if Preventive Maintenance had been performed.
- Failure to Inspect – The breakdown would have been prevented or mitigated by an inspection, i.e. there were signs that the failure was going to occur that were not observed.
- Cultural Failure – There policies or procedures that weren’t followed that could have prevented the failure.
When looking at a failure code, the most important thing to look at is the why behind the failure. When you have failure codes, you know what to focus on to help prevent future breakdowns and failures.
If you’re noticing a lot of your machine downtime comes with a User Error failure code, then maybe it’s time to invest in some training to reduce those errors.
If your downtime is coming from failure to perform PM failure codes, then policies focusing on PM completion will help reduce the equipment downtime. In each case, the failure code will help you know what needs to improve to reduce your downtime.
Mean time to repair
The second way to reduce downtime is by directly finding ways to take less time for asset maintenance or your mean time to repair (MTTR). Remember that this is not just time spent on repairs. To shorten your MTTR, look at ways you could reduce the following:
- Time to Assignment – How long, on average, does it take you to assign a work order to an employee after being notified that it is down? What could you do to reduce that time?
- Time to Diagnosis – In the case where it is uncertain what caused the asset to go down, how long, on average, does it take you to perform an inspection to diagnose what happened? What could you do to reduce that time?
- Time to acquire parts – Do you have the parts on hand in your inventory? How long does it take to find and retrieve them? If not, how long does it take to get that inventory in stock?
- Time to repair the asset – Once an employee arrives to make the repair, how long, on average, do they spend repairing the asset?
- Asset Cooldown Time – Some Assets require time to cool down before they can be worked on. How much time is spent in cooldown? While this isn’t necessarily a time you can reduce, it should still be accounted for.
- Time testing and restarting – Once repairs have been done, how much time does it take to get the asset restarted, calibrated, tested, and back in operation? Are there ways to shorten that process without compromising the asset?
While there are some time costs that cannot be avoided, there are still many human time costs that could be reduced through better efficiency, communication and following asset management best practices.
Tracking equipment downtime
Downtime is a part of life when managing assets, but you need to be able to track it effectively or you will just end up running from failure to failure throwing money down the drain. Tracking your downtime with an EAM solution can show you exactly where you are incurring costs so you can adjust accordingly.
Every asset is different and will require different maintenance strategies, but downtime will happen for any asset you have. Tracking it effectively helps you better prepare for planned downtime and shows you where you can adjust your maintenance strategies to improve your downtime efficiency.
Effectively tracking your downtime allows you to better prioritize your time on wrench. Getting ahead of your reactive maintenance operations can free up your technicians to focus on more efficient, more cost-effective PMs.
Tracking downtime also increases your asset reliability. For example, intentionally taking an asset offline for 30 minutes to lubricate a fan once a quarter is significantly cheaper than losing an entire day or more of production and having to purchase a new fan when the machine fails.
Most maintenance manager focus on either cutting maintenance costs or boosting production to increase profits. Tracking your equipment downtime is an effective way to do both at the same time.
The golden rule of downtime
When it comes to equipment downtime, there is one golden rule that will help you save money and time: First measure, then ask why. When you understand where your organization is currently at (measure), and you know the reasons behind that number (ask why), then you can take the steps you need to improve your downtime.
ManagerPlus’ EAM software can easily help you with this. We allow you to measure any aspect of your assets through logs, meters, inspections, and work orders. Then, we let you assign service codes and failure codes, and write notes, so you know the reasons behind your performance. Bi (Business Intelligence) dashboards and reports will display it all. We put real improvement within reach.
If this sounds like the type of improvement you are looking to make in your organization, give us a call and let us show you how ManagerPlus’ maintenance management solution can enable you to take control of your asset lifetime. The use of maintenance management software is not limited till equipment management, instead it can be used for fleet maintenance, work order management, inventory management and more.
If you already use ManagerPlus, we would love to provide the training to help you get more from your platform. We look forward to helping you succeed!