How to compute the full impact of unexpected downtime?

An unexpected mechanical breakdown can put serious pressure on your entire organization, especially when it happens on a production-critical machine. The production manager worries about missing her targets, the maintenance manager is getting annoyed that he can’t really figure out the cause of the breakdown, the plant manager is getting more and more worried about how much all of this is gonna cost him…You know this story.

This little scenario showcases the main reason why so few companies know exactly how much downtime is costing them each year: there are a lot of direct and indirect consequences that come with it and these are dispersed over the entire organization. 

Because the consequences of a mechanical failure can be felt throughout the entire organization it’s best to get started on this exercise by organizing a little brainstorming session. A group of 5-7 people from different backgrounds is ideal to stimulate out of the box thinking, while still keeping the meeting effective. Try to include someone from maintenance, production, human resources, finance…. 

The goal of this group is to come up with all the different ways in which each hour of unexpected downtime is negatively impacting your company. Here is a brief list to help you get started:

• Loss in staff productivity

• Loss in actual production of goods

• Safety risks

• The number of man hours devoted to re-scheduling both the maintenance plan and the production plan

• Reputational and financial consequences of increased delivery time

• Demoralized staff

• Express orders of missing spare parts

• ….

Once you have this list, try to put a monetary value to each consequence to find out which effects cause the most damage and to what amount all these different costs add up. This is the hardest part and there’s no exact science as to how to do this, but even a rough estimate will already help you a lot.

Now that you have an overview of the full impact of unexpected downtime, no one can still deny its strategic importance. One way to put a serious limit on the amount of unexpected downtime is by making the shift towards predictive maintenance. While most maintenance plans rely on periodic maintenance actions, predictive maintenance is built around the idea of only replacing those components that really need to be replaced and doing so before they cause critical damage. The only issue with this approach it that you need a lot of data to enable it.

That’s where our InfraLytics platform comes in handy. It is built to give you full insight in your critical machines and warns you in time when certain components need replacement.

Want to know more? Contact us or sign up for a free DEMO!