Oniqua Intelligent MRO Blog

50% of Unplanned Downtime is Due to This One Thing

Posted by Steve Herrmann

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10/13/15 2:27 PM


An old joke has a man on his hands and knees, crawling around under a street light in the darkness of night. A passerby finds his actions curious, and stops to ask what he’s doing.

“Looking for my keys,” replies the man. “I dropped them on my way home from the bar down the street.”

Sympathetic to the man’s plight, the passerby agrees to help in the search.

After about 10 minutes, and still no sign of the keys, the passerby grows impatient and asks the man, “Are you sure you dropped them here?”

“Oh, I have no idea…,” replied the man, “…but I’m pretty sure I dropped them somewhere on this street on my way home.”

“Then why are you only looking under this street light?” asks the passerby.

“Well…” replies the man, “…because this is where I can see the best.”


The Keys to Maximizing Uptime in Asset-Intensive Companies

And so it often goes in the maintenance, repair and operations (MRO) world. Maintenance managers in asset-intensive companies, doing their level best to keep operations up and running, tend to focus on areas where they have the greatest visibility.

Efforts to apply the ideal combination of corrective, preventive, risk-based and/or condition-based maintenance practices are certainly well-placed, when even one hour of downtime can result in millions of dollars in lost production.

As such, improving maintenance processes and activities is typically where the light of scrutiny is typically cast by operations managers and financial executives. It’s the area that gets the lion’s share of attention when it comes to maximizing uptime.

But while improving maintenance activities is certainly a worthwhile endeavor, it’s not the end game. It’s merely a means towards the larger goal of maximizing uptime and safety while limiting negative environmental impact.

As such, the focus of corporate executives’ attention should be broadened to all areas across an operation that might potentially thwart the achievement of maximum uptime at the lowest possible cost.

But is there really another area within the MRO operation that can SIGNIFICANTLY reduce unplanned downtime? An area that often lies in the maintenance function’s shadow?

Turns out, the answer is a resounding yes.

According to a recently published report from the Aberdeen Group[1], a full 50% of annual unscheduled asset downtime can be attributed to…wait for it…a lack of spare parts.

Think about that for a moment.

While so many companies are investing millions of dollars in the latest maintenance processes, systems and approaches to keep equipment up and running… with all the latest sensors being embedded… with all the talk around the Industrial Internet of Things… half of all downtime can be eliminated simply by ensuring the right spare parts and material are available when needed!

The Industrial Internet of Things is certainly coming, and its benefits an all but foregone conclusion. But it will take several years before it reaches a real tipping point (early adopters notwithstanding) – the point where TCO is driven down, real value is driven up, and adoption becomes truly accessible to all.

Several reputable reliability-centered maintenance systems and approaches exist today… but most require a herculean effort to get up and running. Time-to-value are often measured in geologic time scales.

By contrast, getting a handle on spare parts inventory levels is something that can be done relatively quickly and with immediate returns – and does not require a massive, multi-year software deployment across the enterprise.


Benefits of MRO Inventory Optimization

According to the author of the Aberdeen report, the numbers behind the numbers (figures not published in the final report, but shared with your humble LinkedIn publisher) indicate the average unscheduled asset downtime for all respondents in the survey was 8.8%... with the average amount of downtime due to the lack of a spare parts/stock outs being 4.4%.

The report (a complimentary copy of which can be downloaded here states that “…Best-in-Class companies have turned to proactive maintenance to improve the availability, reliability and safety of their operations… Best-in-Class companies saw 12% less unscheduled asset downtime and 15% higher operating margins compared to Laggards. However, implementing this proactive maintenance approach takes a mastery of inventory levels…”

In other words, a strong foundation of inventory control undergirds the effectiveness of any maintenance program if the goal of maximum uptime is to be achieved.

According to the report, “Best-in-Class” companies have a much stronger focus on spare parts forecasting, planning and logistics compared to only 28% of “All Others”:


Drilling down a level deeper, the report reveals the extent to which Best-in-Class companies shine a brighter light on key inventory metrics compared to “All Others”:


And what do the Best-in-Class get for their efforts?

The report goes on to show the correlation between establishing effective inventory controls and the successful achievement of corporate financial goals:

So, of course, operations executives and financial officers within asset-intensive organizations should continue shining a strong and bright light of scrutiny on their companies’ maintenance planning, scheduling and reporting processes. These will always be critical to operational efficiency.

But it could very well be that the keys to a significant, rapid reduction in asset downtime can be found in an area currently getting less attention – beyond the maintenance spotlight… possibly in the dark reaches of an inventory warehouse somewhere.

Download the Aberdeen Report today

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[1] The Importance of Inventory Optimization in MRO, July 2015, Aberdeen Group.

Topics: inventory optimization, unplanned downtime, MRO

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