Page 37 - An Introduction To Predictive Maintenance

Financial Implications and Cost Justification 27

Accordingly, it is important to have good past records if we are to do any better than
guess at a value. If breakdowns are purely random occurrences, then past records are
not going to give us the ability to predict precise savings for inclusion in a sound
financial case. They may, however, give a feel for the likely cost when a breakdown
happens. At best, we could say, for example, the likely cost of a stoppage is $8,000
per hour, and likely breakdown duration is going to be two shifts at a minimum. The
question senior management then has to face is: “Are you willing to spend $10,000
on this condition monitoring device or not?”

2.2.1 Poor-Quality Product as Plant Performance Deteriorates
As a machine’s bearings wear out, its lubricants decay, or its flow rates fluctuate, the
product being manufactured may suffer damage. This can lead to an increase in the
level of rejects or to growing customer dissatisfaction regarding product quality.
Financial quantification here is similar to that outlined previously but can be even less
precise because the total effect of poor quality may be unknown. In a severe case, the
loss of ISO-9000 certification may take place, which can have financial implications
well beyond any caused by increased rejection rates.

2.2.2 Increased Cost of Fuel and Other Consumables as
the Plant Condition Deteriorates
A useful example of this point is the increased fuel consumption as boilers approach
their time for servicing. The cost associated with servicing can be quantified pre-
cisely from past statistics or a service supplier’s data. The damaging effects of a
vibrating bearing or gearbox are, however, less easy to quantify directly and even
more so as one realizes that they can have further consequential effects that compound
the total cost. For example, the vibration in a faulty gearbox could in turn lead to
rapid wear on clutch plates, brake linings, transmission bushes, or conveyor belt
fabric. Thus, the component replacement costs rise, but maintenance records will not
necessarily relate this situation to the original gearbox defect. Figure 2–2 shows
how the cost of deterioration in plant condition rises as the equipment decays, with
the occasional sudden or gradual increases as the consequential effects add to
overall costs.

2.2.3 Cost of Current Maintenance Strategy
The cost of a maintenance engineering department as a whole should be fairly clearly
documented, including wages, spares, overheads, and so on; however, it is usually dif-
ficult to break this cost down into individual plant items and virtually impossible to
allocate an accurate proportion of this total cost to a single component’s maintenance.
In addition, overall costs will rise steadily in respect to routine plant maintenance as
the equipment deteriorates with age and needs more careful attention to keep it running
smoothly. Figure 2–3 outlines the cost of a current planned preventive maintenance
strategy and shows it to be a steady outflow of cash for labor and spares, increasing
as the plant ages.