Holistic, enterprise-wide asset management improves profitability, survey finds

That’s the key finding of a global online study among 189 companies representing utilities, manufacturing, mining, the process sector and transportation, sponsored by ERP and EAM (enterprise asset management) software firm Lawson. Dubbed ‘Strategic Asset Management Across the Organisation Delivers a Compelling Return’, its survey suggests that concerns about corporate social responsibility (CSR) are increasingly influencing asset management decisions. “In the past, plant safety has been primary an internal plant issue concerned with keeping operators safe, but because of CSR, it’s now more an external business issue,” comments Brian Dunks, Lawson, senior product manager. “Manufacturers are increasingly concerned about the impact of their plants on local people and their environment, so there’s a lot more interest around maintenance strategies – RCM [reliability centred maintenance], TCM [total corrective maintenance] – to maximise plant safety and efficiency as well as profitability.” In fact, a full 97% of survey respondents said they have at least one CSR initiative in place. And although the report does not detail the projects themselves, Dunks suggests the most common are improving energy management and emission reduction monitoring. Suzanne Benn, marketing director at Lawson, explains: “A strategic, integrated approach to asset management can play a big role in addressing CSR and the other asset issues.” And she adds: “As examples, an integrated enterprise asset management solution will support these efforts, helping to ensure that a company’s assets operate efficiently within environmental guidelines… A preventive maintenance programme can help to lengthen the lifespan of spare parts and assets, save natural resources and reduce waste.” But there’s another slant that Lawson takes from its research: it suggests that some – albeit, it concedes, a minority – early EAM adopters are now viewing maintenance as a profit opportunity, not just a cost. It points to 39% of respondents saying their company strongly believes that maintenance is a worthwhile investment. Dunks explains: “People are now understanding that RCM increases reliability and availability of plant, which in turn leads to more throughput. And, preventive maintenance and condition monitoring techniques also extend the lives of their assets saving on capital expenditure. “Also, EAM extended beyond maintenance works orders improves spares inventory management and procurement, enabling purchasing to negotiate better discounts, call-offs, consignments etc. And there are benefits on the planning side that mean manufacturers are less likely to need emergency orders and the costs that come with those.” Interestingly, Lawson’s study also show that where manufacturers do not adopt holistic asset management, the converse is true – finance and procurement don’t encourage investment and that, in turn, impacts maintenance and production outcomes negatively. The survey shows that more than 70% currently spend less than half their maintenance budget on preventive work, favouring ‘break-fix’ instead – and these are the ones losing more than 11% of production time annually to unplanned downtime. “This tactical and reactive approach is not sustainable, and companies must formalise policy and strategy for asset management to improve operational performance, as regulations increase and society becomes intolerant of failure or accident statistics,” insists Benn. Manufacturers interested in participating in the survey can do so from the Lawson website. Taking part also allows you to benchmarks yourself against similar companies in similar industries.