5 min read
Nov 17, 2015
Facility Management

What Is a CMMS and How Can It Save My Business Money?

If your machines break down all the time, you need computerized maintenance management software (CMMS) to help track repairs and predict future failures.

Karen McCandlessAnalyst

If your machine breaks down, who do you call? The maintenance team, of course. But they’ve got 10 jobs to do before they get to your issue, because a clear priority list is not in place, and they are performing maintenance in order of request received. If this scenario sounds familiar, then your company could use a computerized maintenance management software (CMMS) solution.

A CMMS helps the maintenance team not only organize its schedule and determine which machines need to be repaired, but it also tracks what has been repaired and when so they can predict future failures. Management can also use the system to prioritize certain jobs, as well as calculate costs and focus on preventative instead of corrective maintenance.

The right CMMS can help you improve your planning and scheduling, reduce downtime by preventing failures, extend the lifecycle of your assets, and decrease the time technicians spend on jobs by increasing wrench time. It can also save your business a lot of money.

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How can a CMMS help me save money?

There are four major ways that a CMMS will help you cut costs:

  1. Labor and productivity

  2. Parts and inventory

  3. Downtime

  4. Asset lifecycle costs

Let’s look at each of these factors individually to see how you can save.

Labor and productivity

If you still use manual tools to track and schedule maintenance tasks, your productivity could be taking a hit. Not only are you more at risk of downtime, you also might not have the correct parts to hand. This causes a reactive rather than proactive approach to problems, as well as lost time and effort on manual data entry.

With the right CMMS in place, you can cut costs and boost your productivity in a number of key ways:

  • Maximize labor resources through better planning and scheduling

  • Reduce time spent manually assembling reports and KPIs

  • Reduce data entry through real-time mobile maintenance.

An example of cost savings would be to calculate the number of employees who perform unplanned maintenance and multiply this by their average daily salary and the number of business days a year, and then multiply that by a figure between 10% and 40% depending on whether you want a conservative savings estimate or a more high-end estimate.

Parts and inventory

If you mismanage your parts because you don’t have a comprehensive overview of your inventory, you risk having too many wrong parts, and not enough of the right ones, meaning those mission-critical assets can’t be fixed. A CMMS can help you auto-reorder parts based on minimum/maximum levels, manage multiple inventory locations, track cost of parts issued and returned against work orders, and manage stock and non-stock parts. It helps you cut costs by:

  • More effectively coordinating part and equipment availability

  • Reducing expedited shipping costs through better coordination of part availability.

Downtime

Downtime is extremely costly to your business. A CMMS can help minimize downtime by establishing a Preventative Maintenance program. It can also help cut costs by:

  • Reducing the cost of lost production

  • Decreasing the amount of time production staff stays idle.

An example of how to calculate the annual savings that a CMMS can bring is to multiply the hours of unplanned downtime per month by the potential revenue you make per house by the number of months per year.

Asset lifecycle

Equipment is expensive, so extending an asset’s lifecycle by several years could have a massive impact on your bottom line. This all comes from establishing an effective asset management solution, to help you make data-driven decisions on whether to repair or replace a part. An effective CMMS can help you here by:

  • Extending the life of equipment by tracking preventive maintenance

  • Improving return on assets by gaining insight into repair vs. replace decisions.

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What’s the ROI?

Using the information above can help you calculate a rough ROI of a CMMS to help you justify the investment in new software. To help you pin down the numbers, eMaint has created a ROI calculator that explains how a CMMS can help you cut costs and provides simple equations that allow you to work out just how much money you will save annually from your new technology.

This post was brought to you in conjunction with CMMS software provider eMaint.

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