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In our previous blog, Reactive vs Preventive vs Predictive Maintenance, we defined Reactive Maintenance as a strategy of repairing parts or equipment only after the asset has broken down or been run to the point of failure.
It can be an appealing process because it seemingly offers the maximum utilization and in turn maximum production output, of the asset by using it to its limits. This strategy is only beneficial, however, up until the point where the asset fails. Preventing failures of assets under load, however, has been proven to be far more cost-effective with the same production output.
It is a widely accepted industry fact that a well-planned and scheduled corrective Work Order is about three to four times less expensive than the same unplanned reactive Work Order. [1]
Organizations utilizing this reactive maintenance strategy/ approach often fall victim to treating the asset symptom, rather than the problem causing the symptom.
When maintenance moves from a reactive to a planned environment, there is less wasted time and effort looking for the right part and getting instructions. As a result, there is less confusion around who is doing what and when. Also, repairs can be coordinated with production resulting in quicker turnarounds since the assets will not be under load when the repair starts.
Imagine the craft productivity that could be attained if your technicians go straight to the job and straight to work, rather than spending the first hour or two searching for a plan of action or having production clearing out the equipment before work can start.
1. Difficult to Control Budgets
As equipment failures can be unpredictable, labor and spare parts may not be readily available, so organizations may end up paying a premium for emergency parts shipping, travel time and out of hours support. It is therefore difficult to accurately budget for maintenance and to provide proper forecasts of when budgets will be spent.
2. Shorter Life Expectancies of Assets
Reactive maintenance does not keep the systems running in optimal “as new” condition. Over time, systems that have been maintained reactively deteriorate faster due to related induced failures and therefore do not maximize their initial capital cost investment. This negatively impacts a company’s RONA (Return on Nett Assets) which in return reduces shareholder value.
3. Safety Issues
When work is properly scheduled, technicians have time to review the standard procedures and safety requirements to complete the job correctly. Technicians tend to take more risks when maintenance work is reactive as they are under pressure to get systems running without delay. Most companies have Safety and Health as one of their strategic objectives and a reactive / breakdown approach goes directly against this objective.
4. Time-consuming
Reactive repairs tend to take longer due to several factors including time to diagnose, travel time, time to pull parts from stores or submitting emergency orders, time to pull correct manuals and schematics… etc. This, therefore, impacts the ability of the production teams to achieve their production targets and depending on which equipment fails can have a negative impact on revenue.
5. Sporadic Equipment Downtime
Planned maintenance can be written into the production schedule whereas unplanned repairs can happen anytime. Also, there is the uncertainty around the length of the delay due to the unplanned repair. Equipment that often/sporadically breaks down reduces the trust between maintenance and production.
6. Inefficient Use of Resources
Technicians spend time running around looking for the correct manuals and schematics, ordering the right parts, etc. and trying to diagnose and fix the issue. Often, they need to wait for equipment to be cleared and permits to be issued. In essence, companies pay for their resources (technicians, special tools, equipment, etc.) to be productive and all waiting times comes at a high cost to organizations.
7. Interferes with Planned Preventive Work
Emergency repairs are usually prioritized at the expense of planned preventive work. Planned work may be pushed or canceled completely resulting in future unexpected failures that will result in additional unplanned work and future preventive work being missed. This is what is called the maintenance death spiral.
8. Collateral Damage
A minor issue could quickly turn into a major system repair. For example, if your car’s engine is low on oil, it could result in warn cylinders or damage to seals, but ultimately in a completely seized engine. Or the slight misalignment of a shaft not only damages the bearing but over time can result in a cracked or seized gearbox or even damage to the shaft itself.
9. Indirect Costs
Unplanned downtime can lead to late orders if equipment cannot be returned to production in time. This can damage reputation and impact revenues. Persistent non-delivery or late delivery of orders can have the knock-on effect that key customers lose confidence in the organization and may go to other suppliers or demand discounts/ raise penalties which can cost the organization millions.
10. Repeat Issues
Reactive maintenance does the bare minimum to get the system up and running again, due to the pressure to return the plant back to production. If not repaired correctly soon after (and typically this rarely happen), the issue could reoccur and cause more downtime. A very negative downward spiral.
11. Higher Energy Costs
If you don’t service your car, it burns more fuel! When equipment is not properly maintained, it uses more energy. Doing simple things like greasing moving parts or changing filters can reduce energy consumption by up to 15%.
Repairing damaged equipment quickly is important for minimizing downtime. Relying on a reactive maintenance strategy, in most cases, is, therefore, an inefficient and very costly way to operate. Emergency repairs cost as much as 5 to 7 times more than planned preventive work, which can obviously have a huge impact on the bottom line.
Planned and scheduled maintenance leads to an increase in asset reliability and availability, better reporting and measurement, efficiency improvements on all resources, and a reduction in overall maintenance costs. This is due in part to fewer emergency repairs, vendor call-outs, spare parts required, material expedites, and productivity losses.
Reactive work is more expensive because the resource requirement cost cannot be planned properly. Also, one must consider that with planned maintenance, failures might have been avoided.
In the case of failure, parts may need to be rush ordered or, even worse, you must have spare assemblies and or sub-assets in your warehouse; but moreover, it leads to a non-productive cycle of work.
However, there is a point where the law of diminishing returns takes over. Continued increases in planned maintenance eventually reach the point where it becomes too costly. And even with a first-class planned maintenance strategy, it is impossible to avoid the occasional emergency repair.
An ideal maintenance execution model would be an overall ratio of planned/scheduled to reactive maintenance of 80/20. Setting in place solid planning & scheduling to support this objective is key to achieving these returns.
Various tactics may be employed to reach an 80/20 goal. The first consideration is to group your assets based on their criticality and ensure that High Critical Assets are maintained more proactively while low/non-production assets can be maintained more reactively.
A second consideration might be to split the maintenance teams into preventive and reactive crews to handle the different work types. This means the team focused on preventive maintenance can stay focused on preventive maintenance and try isolating issues before they occur. Another possible strategy may be to move certain work activities to a second or third shift, again focusing on specific assets or specific work activities.
For more information on how Prometheus Group can help your organization reach this 80/20 goal, request a demo of Prometheus Planning & Scheduling.
[1] Marshall Institute – A Measured approach to Uptime
