How to Calculate the Total Cost of Ownership for Your Assets
When it’s time to buy or replace an asset, it’s easy to focus purely on the initial purchase price. But digging deeper could save your organization a lot of time and money in the long run. The key is to calculate both the direct and indirect costs, which is called Total Cost of Ownership (TCO). TCO is the full cost of an asset over its life cycle or “cradle to grave”—a number that might look very different from the initial purchase amount. Calculating Total Cost of Ownership Total cost of ownership is a simple equation. TCO = [Initial Cost] + [Operating Expenses] + [Maintenance Costs] + [Downtime Costs] + [Production Costs] – [Resale Value] Initial Cost: The amount of the initial purchase. Operating Expenses: Cost of installation, testing, and training, plus energy usage and insurance (if applicable). Maintenance Costs: Cost of repairs and maintenance, including both PMs and unexpected repairs. Downtime Costs: Labor costs of delayed work, lost production, lost revenue, etc. Production Costs: Output levels or production levels as well as environmental costs. Resale Value: The amount that could be recouped by selling the equipment after a certain timeframe. Finding TCO Data Let’s look at an example. Kai needed to buy his maintenance shop a new generator. He looked at three—and the price of one was about 20% higher than the others. It should be an easy decision, right? Pick the least expensive one. But Kai knew he had to dig deeper by looking closer at the TCO for each one. While the TCO equation seems easy, getting that information isn’t always simple. Kai had a good start within his MPulse Maintenance Software. First, he found the existing data for his current compressor. Then he could compare that information against the new compressors and estimate the operating expenses, projected downtime costs, and production costs by pulling some key reports. The maintenance costs and resale value took a little more research. After comparing the manufacturer’s recommendations, he discovered the more expensive generator required less maintenance. Additionally, its resale value was significantly higher—making its TCO lower than the others. Kai knows it would be hard to calculate the TCO without his CMMS software. His numbers would be based more on assumptions than hard data. It’s likely your purchasing or accounting department is familiar with TCO, so tap into that resource if it’s available to you. Have you found a surprising result from your TCO calculations? Contact us to learn how MPulse can help.
Get Seasonal Assets Up and Running in Time
If you needed a reminder to get seasonal assets up and running in time, here it is! It was a typical Monday morning, until Dawn sat down at her desk. She had a surprise waiting for her—a big pile of outstanding work orders. Dawn quickly realized these work orders had one thing in common—they were all PMs for assets that were unused during the winter but were in high demand as the weather warmed up. “Suddenly everyone needed their equipment up and running quickly,” she said. “We missed an opportunity to schedule this preventive maintenance work before the equipment was needed. It added to the stress of a hectic week for our technicians—and for me.” Spot Issues Before They Occur CMMS software helps prevent problems like this one. Maintenance and inspection schedules generated from CMMS can schedule the work when the equipment is not in use and the maintenance team has more time. Maintenance intervals can be scheduled based on asset or part condition, which triggers a work order just before the point when system inefficiencies or failures begin to occur. Regular preventive maintenance for seasonal equipment means getting the work done before it’s needed. With CMMS software, maintenance professionals like Dawn can… Generate a schedule of PM tasks, making it simpler to follow the manufacturer’s guidelines Create automatic work orders to ensure equipment is properly calibrated and lubricated Estimate labor hours for PM tasks, making sure staffing levels match the workload and decreasing overtime costs Help determine when it’s more efficient to add more staff members instead of paying current employees more overtime Schedule maintenance and repairs during off hours or during seasonal slowdowns by tracking equipment use time Benefits of PM Scheduling When your organization’s equipment hasn’t been maintained properly, you’re going to experience more breakdowns. That translates into lost dollars and intense pressure on the maintenance team to get production running again—adding more stress to the workday for people like Dawn. When a maintenance team establishes and regularly performs PM tasks that contribute to the upkeep of assets, an organization may be able to sidestep serious problems that arise because of neglect as well as delay more expensive maintenance. When you use CMMS software for maintenance scheduling, you’ll reduce emergency maintenance issues and unexpected production stoppages. This, in turn, cuts overtime costs for emergency repairs and reduces production losses. How do you streamline your PM schedules? Leave a comment or contact us.
Your Maintenance Department is a Profit Center
Traditionally maintenance was thought of a cost center—an area that does not directly add to profit, but still costs money to operate. Not anymore. Today’s organizations have discovered maintenance has a direct effect on their profitability. Your Maintenance Department is a Profit Center How? Modern maintenance technology has shown managers and accountants how maintenance generates revenue for the organization. The objective of a cost center is to minimize costs. However, a profit center’s goal is to maximize profit. It’s a subtle but important shift in perception, and it’s changing the way organizations of all sizes think about their maintenance operations. What Changed? This change started with the rapid adoption of data-driven management, which simply means making management decisions backed by reliable data instead of assumptions or perceptions. As technology has advanced, more detailed, relevant data is now available. And that data reveals some interesting things, including how the maintenance team makes major contributions to the organization’s financial viability. These contributions include… Safer operations (because accidents cost money) Higher quality product (because rework costs money) Better production efficiency (because you can produce more output in less time) Reduced downtime (because equipment that isn’t working isn’t producing) Better asset use (because increased capacity means more production capability) In other words, if your organization’s success depends on uptime, reliability, production capacity, or any other quantifiable measurement, your maintenance strategy contributes to much larger goals. How Does Maintenance Contribute to the Bottom Line? Every dollar saved by maintenance is a dollar that goes to the bottom line. Think of maintenance in its simplest form—a production line producing widgets. If the production line goes down, no widgets are made. Which means there are no widgets to sell, and your organization isn’t making money. It’s your maintenance team’s job to fix the problem—and look for ways to prevent it from happening again. Now expand that to your organization. Do you produce goods? Provide services? Rent space? Make deliveries? Every industry relies on maintenance in some form, from buildings to vehicles to production equipment. If you have assets of any kind, you need maintenance. In the past, the maintenance profession was often undervalued and sometimes unappreciated. If that’s the case in your organization, it’s time to re-evaluate how maintenance influences your operation’s productivity and profitability. We’re here to help you get started. Contact us.
Tackle Your Maintenance Backlog
Do you have a backlog of maintenance and repair tasks that feels like it’s constantly growing? You’re not alone. A long list of unclosed work orders or deferred repairs can feel overwhelming, particularly when you see more work coming down the pipeline. CMMS software is here to help. Here are five steps you can take to tackle your maintenance backlog. 1. Identify What Needs to Be Done The first step is to identify the work that needs to be done. Start with your CMMS software to easily find the status of work orders. Organize these work orders by asset, task type, location, or available resources—or a combination—depending on your preferences. Consider how important each task is to complete, asset usage, and impact of downtime or failure. 2. Prioritize Establish a prioritization system for your repairs. For example, any task related to safety should be high on your list, as well as any that might impact production or functionality while a repair is happening. Key assets are going to be a higher priority than ones that aren’t used as often or won’t affect production as much. Seasonal use may also play a part—take advantage of the time the equipment is not in service to perform repairs. 3. Determine What Resources You Need Estimate the labor time needed for each task, plus any necessary parts and inventory. CMMS calendars help with maintenance planning and scheduling upcoming tasks, making it easier to adjust things when necessary. Use your CMMS software to assign work orders to specific team members and determine if you need to outsource any tasks. You can also track each team member’s productivity, and check that parts or supplies are available. 4. Revise Your Plan As you know, things don’t always go according to plan. Pick a time (one week, one month, etc.) to evaluate how your plan to reduce the backlog is going. Use your CMMS software to identify open work orders and update schedules. Adjust your plan accordingly, working through the first three steps again as necessary. 5. Act on Your Discoveries This process will likely inspire better ways to operate your maintenance department in the future. Maybe you’ve discovered you’re understaffed or it’s more efficient to outsource certain tasks. Maybe your team members need additional training to ensure efficiency and competency in the repairs. Your maintenance team is a great resource. Ask them for their insight and get them involved. Whatever you discover, turn it into an action plan. Working through your backlog has long-term benefits, including assets that perform more efficiently, use less energy, and fail less often—extending their usable life. As a result, your organization may be able to sidestep serious problems as well as delay more expensive maintenance. Find out more about how CMMS software can help you tackle your maintenance backlog. Contact us to help.
Rendra AS Acquired by JDM Technology Group
[related-content] MPulse Software announced its parent company, JDM Technology Group, has acquired Lysaker, Norway based Rendra AS, a leading provider of 3D Building Information Modeling (BIM) collaboration software. Rendra AS offers a platform named StreamBIM for 3D BIM collaboration throughout all stages of the construction project, from design, through construction, to as-built handover, and facilities maintenance. Users can always access the latest 3D BIM model and drawings from the field, as well as document issues, and the as-built work completed. Real-time interaction with everyone on the project reduces time sensitive delays between all parties. “We are very pleased to become a part of the JDM group,” said the CEO of Rendra AS, Kristin Omholt-Jensen. “Our strategies are aligned to help building owners, engineers, and contractors complete projects on time and with less construction errors.” By partnering with the JDM Technology Group, an owner that is known to build and grow great software companies, StreamBIM will be able to rapidly grow internationally into the various regions JDM currently operates in. Having acquired numerous companies since 2004, the JDM Technology Group has established a proven strategy for integrating acquired companies into its existing infrastructure. Rendra will continue to operate as a separate company with its existing staff out of its Lysaker, Norway headquarters. Kristin Omholt-Jensen will continue to lead Rendra and oversee day-to-day operations as Managing Director. “Acquiring Rendra reinforces JDM’s position as a market leader providing best of breed solutions to our global customer base,” said JDM Technology Group’s CEO, Jim McFarlane. “As BIM adoption increases through government regulation and various initiatives, we are solidifying our commitment to growth and stability for many years to come.” MPulse Software welcomes Rendra to the JDM family.
Does Your Outdated CMMS Software Cost Too Much?
After two decades in maintenance management, Jose had seen a lot of changes in the field. But it really hit home when he started a new job last year. His new employer—a state agency—had CMMS software. But it was close to a decade old, and it didn’t have many of the features he’d come to expect. “It was eye-opening to see how far technology has come in a relatively short time,” he said. “The old software just couldn’t do what I needed it to do.” The Hidden Costs of Outdated CMMS Software Perhaps the most dramatic example of the problem was when Jose discovered a fleet vehicle had gone missing—and no one knew where it was. “We actually reported it as stolen,” he said. “And then we found it a few months later, parked at another site. That should never happen. We should know who had it and when, so we’d know who to ask and where to look.” Jose soon realized the lost vehicle was just the beginning. His new maintenance team was spending a lot of time and effort trying to work around the old software’s limitations—which was costing the organization far more than the price of new software. For example, Jose found… Key data wasn’t being gathered, making it hard to spot areas where productivity and efficiency could be improved Lack of data integration capability meant entering data manually, sometimes in more than one place Paper workorders were easy to misplace or lose Reporting took far longer—and was sometimes impossible—because the data wasn’t easily available or accessible Data security wasn’t up to modern standards, putting the organization at risk for viruses, malware, hacking, etc. The original software manufacturer wasn’t supporting this version, and hadn’t for some time, so help was limited The Growing Cost of Workarounds If that wasn’t enough, Jose’s team had developed some workarounds—which helped them get the job done, but took even more time away from their work. For example, the lack of historical data meant the techs often stopped working on a job to seek out others who had worked on the asset before, so they could ask questions. “This is information we should have captured—simple things like what was done and when,” he explained. “Our techs should be able to find this at a glance in our CMMS software, not spend more time searching out coworkers to ask.” Once your organization makes the leap to CMMS software, upgrades and updates may feel like more trouble than they’re worth. But software upgrades offer more functionality as technology advances, and that helps you meet the changing needs of the maintenance field. And, as Jose discovered, once you’re spending far more time and money on working around their software than the cost of the upgrade, it just makes sense. What’s changed in CMMS software? Leave a comment or contact us. We’re here for you.
How CMMS Software Can Help You Achieve ISO Certification—And Keep It
If your organization is striving for ISO certification—or needs to keep it up—CMMS software is a vital tool for your maintenance department. ISO certification verifies a company’s management system, manufacturing process, service, or documentation procedure has met the requirements for standardization and quality assurance. Two of the most common are ISO 9000/9001 for quality management and ISO 14001 for environmental standards. Many companies use ISO certification to assure customers of credibility. But some industries require it, and certain contracts will depend on it. Maintenance & ISO Certification ISO certification requires a traceable history of completed maintenance tasks and documented policies to prove you’re acting in accordance with ISO standards. Mike Goldman’s company became ISO 9000 certified without CMMS software before he was hired, but Mike knows CMMS data from facility management software is key to maintaining that certification in the future. “ISO certification is all about the process,” Mike explained. “MPulse helps you provide objective evidence that your processes are being followed—preventive maintenance tasks, lock-out tag-out, hot work permits, etc.” So, Mike set up his MPulse Maintenance Software with ISO certification in mind. “The scheduled maintenance and task functions of MPulse generate work orders for ISO quality control inspection routines,” he said. “You can create tasks for QA process audits, inspections of final product, completed tasks, HSE requirements, HAZMAT—anything really. I also generate work orders for ISO quality assurance auditing requirements and schedules, which provides objective evidence that we completed internal ISO auditing tasks.” MPulse also helps Mike’s team in other ways. “The media attachment capability ties any relevant documentation to the work order. This is a great way to keep your objective evidence handy and connected to the relevant scheduled audit trigger events.” And that documentation looks impressive to an auditor, Mike said. “Game over, you win. Hands down.” CMMS Software for ISO Certification MPulse Maintenance Software can help your organization get—and keep—ISO certification by… Recording preventive maintenance on key assets Documenting work procedures to make sure they are being followed Verifying all safety inspections and tests are done properly and on schedule Determining when it’s time to repair or replace malfunctioning equipment Creating reports and other documentation for audits Tracking employee health and safety information, trainings, and certifications Archiving work history Documenting incidents Preparation is Half the Battle The complexity of ISO certification makes it difficult—if not impossible—to simply pull the paperwork together at the last minute. That’s why CMMS software is essential for maintenance operations. Once you set up your CMMS software correctly, documentation takes care of itself because the every work order captures the data. You can quickly access this information when it’s time to pass the scrutiny of an audit—which saves a lot of time and prevents a last-minute scramble to pull reports together. Have questions? Contact us for more information about how MPulse can help your organization achieve ISO certification—and keep it.
CMMS Software Helps Public School District Take Maintenance to the Next Level
School maintenance isn’t just about taking care of buildings and equipment. Maintenance plays a huge role in the well-being of students, teachers, and administrators. When school districts like St. Mary’s County Public Schools (SMCPS) use facility maintenance software to manage maintenance tasks, they are protecting the taxpayer’s investment in public education. “We have a great team that’s committed to safeguarding the mission of SMCPS, which is to provide the best learning environment that we can,” said Sharon Dvorak, SMCPS work order specialist. “Our goal is to always ensure the comfort and safety of all our students and staff, and provide the best possible outcome for our community. MPulse helps us do just that.” Fixing What Broke For many years, the SMCPS Department of Maintenance operated in the way it knew best. The phone rang. Someone answered it and took a few notes, and then a maintenance technician went to fix the problem. There was little documentation, no preventive maintenance program, and limited historical data or background information. SMCPS wasn’t unusual. Many school districts adopted a maintenance strategy of simply fixing what broke to work within budget restrictions. In July 2004, Sharon Dvorak, work order specialist, was tasked with improving the way the Department of Maintenance handled the growing needs of the school system. Sharon implemented the biggest change just a few months later—the department’s first CMMS software system, MPulse Silver. MPulse Silver gave SMCPS the ability to schedule preventive maintenance tasks and manage work orders as well as the capacity to receive, manage, and update service requests from unlimited requesters. Sharon started using MPulse’s school maintenance software the same way most new CMMS users do—setting up the database with all the district’s building assets, employees, maintenance tasks, work order types, trades, and departments. In the autumn of 2004, with the basics in place, SMCPS began receiving and processing their first computer-generated work orders with school CMMS. By 2006, MPulse CMMS maintenance software was widely accepted throughout the organization. Fast forward to August 2016, and Sharon hit a major milestone—surpassing 100,000 opened work orders. Work Order Management Like most MPulse administrators, Sharon’s day centers around work order management. MPulse helps the SMCPS maintenance team get the highest priority work done while making sure lower priority work doesn’t slip through the cracks. “We needed to prioritize,” Sharon said. “Over the years our budgets have started to dwindle, so we needed to make sure we were spending our time—and our money—wisely.” Prior to their MPulse implementation, 100% of the Department of Maintenance’s repairs were unplanned. “Our scheduled maintenance program has taken us from a completely reactive work force to a balanced 48% planned and 52% unplanned,” Sharon said. “It’s taken our organization to a whole new level.” Download our customer success story or contact us to learn more about how MPulse customers are using our CMMS software to improve their maintenance operations.
Next Level Maintenance Reports with Turn-Key Data Integration
CMMS software captures key maintenance data to help you create reports or documents with details of your team’s maintenance work. But often other departments need access to that data, or have their own data that’s useful to maintenance managers. That was the situation facing Saint-Gobain Ceramics High Performance Refractories (HPR) maintenance department in their Worchester, Massachusetts, facility. At the request of the management team, application developer Gary Potter was tasked with finding a way to integrate data from the company’s SAP ERP system with CMMS data in their MPulse Maintenance Software. Gary needed a simple solution that was effortless for users and integrated easily with the company’s local network. Data Integration Solution Since 2014, Saint-Gobain Ceramics HPR has used MPulse Platinum—our most comprehensive software package designed for the largest, most complex maintenance operations. Gary worked closely with MPulse during the initial implementation process, and he turned to MPulse again for a data integration solution. Working with our support team, he quickly determined the MPulse DataLink Integration Adapter was the way to go. DataLink offered Gary a way to easily move data in and out of MPulse using a familiar, intuitive interface. Now when maintenance technicians create a purchase requisition, the company’s SAP ERP software associates the purchase order with the specific work order. When the parts are received, SAP sends the costs and stock information to MPulse, giving managers access to the numbers they need to make important decisions. As a result, the maintenance crew and the accounting department are in sync and their inventory stock levels are updated and accurate. Best of all, “it’s all automatic,” Gary explained. “MPulse DataLink checks for new information every few minutes. We don’t have to do anything else.” Benefits of Turn-Key Data Integration DataLink enables Saint-Gobain to leave the accounting to the financial application, and synchronize the results back to MPulse for informational and reporting purposes. As a result, Saint-Gobain maintenance managers can use financial data and CMMS data to accurately calculate maintenance costs. After an easy implementation process, Saint-Gobain plans to expand the use of DataLink by using MPulse’s advanced inventory capabilities in the future. The company anticipates big benefits, like the ability to… Accelerate and track the complete purchase lifecycle Leverage MPulse’s reporting and forecasting capabilities to drive business intelligence Eliminate manual double entry of inventory and purchasing information Increase accuracy and freshness of data Reduce emergency non-stock situations by improving usage planning Implement standardized data and improve vendor management And Gary emphasized something else that is close to any IT professional’s heart: “It just works.” Download our customer success story, or contact us to learn more about how MPulse customers are using our software to improve their maintenance operations.
Estimate Software Acquired by JDM Technology Group
MPulse Software announced its parent company, JDM Technology Group, has acquired Estimate Software Limited, a leading provider of construction estimating software. The transaction closed as of August 31, 2017, after approval by Estimate Software’s founders and owners, John Forster and Barry Groom. JDM is a global group of leading software providers for the architecture, engineering, and construction industries. Estimate Software is based in Witney, UK, and provides estimating and takeoff software as well as price libraries for the construction industry in the United Kingdom and around the world. The acquisition strengthens the JDM Technology Group with a broader offering of estimating software solutions to its existing customer base as well as increased construction software offerings to Estimate’s customers. “We are pleased to complete this transaction with the JDM Technology Group,” said Barry Groom, co-owner of Estimate Software. “Working with our customers and the construction industry has been very rewarding. As we considered next steps, we looked for an acquirer that could serve our customers and continue our legacy by building the Estimate brand and organization. With its focus on customer-service and construction software, I’m confident the JDM Technology Group is the right choice. Our customers will be supported by a group of leading construction software organizations that are unparalleled as they collaborate in redefining the future of the construction industry.” Having acquired numerous companies since 2004, the JDM Technology Group has established a proven strategy for integrating acquired companies into its existing infrastructure. Estimate Software will continue to operate as a separate brand with its existing staff, while combining with the resources of Integrity Software Systems, a JDM Technology Group company based in Lincoln, UK, with which Estimate shares some customers. Sophie Hurst, Managing Director of Integrity Software, will lead Estimate Software and oversee day-to-day operations of both Estimate and Integrity. Both Barry Groom and John Forster will continue with the company during the transition period. “Our Buy and Build strategy ensures that customers continue to have access to the best technology globally. In addition, by retaining the Estimate staff and organization, customers will continue to receive service and support from the same people they are used to,” commented Jim McFarlane, CEO of the JDM Technology Group. “As well, we do not end-of-life any products, allowing customers to continue with their preferred software. This strategy creates strong growth and enables the JDM Technology Group to continue to be an excellent home for leading construction software companies.” MPulse Software welcomes Estimate Software to the JDM family.