reduce enterprise assets ongoing maintenance & operation costs

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Reduce Enterprise Assets’ Ongoing Maintenance & Operation Costs Managing cost is a huge challenge in every industry across the world, today. If costs are not managed appropriately, expenditures can outpace income. At that point, a business runs the risk of not being able to operate due to lack of funds. Without adequate operational budgets, a business won’t be able to address future challenges — let alone launch new initiatives.


As less personnel are required to oversee more enterprise assets, managing maintenance and operations can be a challenge. While expectations to deliver may increase, your personnel in key roles may experience stressful workloads that can lead to larger business issues.

Over time, physical assets require maintenance, repair, and possible replacement from time to time. Asset maintenance and management must be more cohesively aligned to provide benefits to your business.

Percentage Replacement Asset Value [%RAV] The benchmark for maintenance productivity is maintenance cost as percentage of total replacement asset value (RAV) per year. For example, an asset worth $1,000,000 where you’ve spent $50,000 to maintain it can be said to have an RAV of 5%.

This graph shows the best and the worst %RAV. To maintain an asset worth $100,000,000 from typical to best-‐in-‐class status might mean the difference of up to $5,000,000 in savings per year.

Benchmark of maintenance productivity is annual spending as a percentage of replacement asset value [%RAV]

The goal is to keep your asset in good running condition without overspending on maintenance. That way the enterprise retains better assets in good condition to perform over time.

Often, asset maintenance is either late and/or not performed in a timely manner. Largely, this is due to the absence of tools that would otherwise track asset-‐related data for an enterprise. Even when tools are available, often they are often not integrated so that useful data can flow between key areas of the business. When asset-‐related data is trapped in silos it’s rendered useless when needed most.


A proactive maintenance strategy can help prevent unnecessary work and mitigate ineffective maintenance. Here are some different approaches to managing assets;

Reactive Asset Maintenance This is an ad-‐hoc “fix it as it breaks” approach. Unfortunately, this is a common, but costly and inconvenient strategy. If something happens to an asset, just fix it. Downsides to this approach are numerous. Repair costs can be high. If the asset is not repairable, it often needs to be replaced. And there can be costly, unexpected downtime associated with that replacement.

Preventive Asset Maintenance A more vigilant enterprise may check assets frequently to measure operational condition so issues can be addressed ahead of serious potential problems. This approach is usually less expensive and easier to manage than reactive maintenance. Frequent checks on assets followed by evaluation of data collected can help provide warnings that particular assets may need maintenance. Generally, this is a good strategy.

Predictive Asset Maintenance When you are able to constantly monitor the condition of your assets, you are better positioned to head off breakage, malfunction, or other problems before they occur. This approach goes beyond simple scheduled maintenance and often delivers complementary benefits as well.

Perhaps the best strategy is to leverage all three approaches if possible. Predictive maintenance is most effective of all.

Proactive Asset Maintenance A business could also work to proactively analyze the performance of their assets over time in an effort to understand why performance tends to degrade. Data collected from an approach like this can be used to help prevent assets from degrading.

It’s best to proactively maintain assets from the start in order to improve its overall performance, lifecycle, and return on investment (ROI).

Asset Lifecycle Cost Strategy Given enough time, any physical assets will degrade. Unless physical assets are maintained consistently and well, there’s a high probability the asset’s value will decrease over time. Rebuilding or replacing a completely broken asset can require enormous cost and this is not desirable for any business. Under-‐maintained assets can also contribute to a situation that endangers the health of your business.


You Have Numerous Options for Managing Your Assets There is unprecedented number of IT computing systems that can manage these assets. Most IT implementations to manage these assets have massive IT costs involved. There is huge amount of hardware and software needed. Software vendors are charging increased rates to implement and support their systems. The question is; If you want to effectively and economically manage these assets what can be done in-‐house? We suggest you find a cloud-‐based solution with a pay-‐as-‐you-‐go model in place. Why pay for anything more than the specific resources you consume?

To read the complete white paper on Cloud to manage assets, please visit us at

http://www.orblogic.com/whitepapers.aspx

Orblogic provides its solutions in public cloud using pay-‐as-‐you model (Amazon Web Services). There is a 31 day free trial available.

http://aws.amazon.com/search?searchQuery=orblogic&searchPath=all

reduce enterprise assets ongoing maintenance & operation costs

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