It has been reported that great companies focus on productivity, not efficiency. Yet for any business that wants to succeed, striking the balance between efficiency and effectiveness is a battle that they face daily. A business that runs efficiently achieves its targets sooner, and has less wastage, better cost control, and a happier workforce. However, the road to greater efficiency is continuous and expansive to all parts of the business – including its assets. From scheduling regular employee skill workshops to blocking out time for standard machinery maintenance, prioritizing your planned maintenance tasks is just as important as coming up with new strategies for growing your business. Choosing to ignore or forfeit them in favor of greater profits or more production time can not only impact your bottom line today, but set the tone for the future of your business.
Avoiding Planned Maintenance Puts Your Business At Risk For Non-Compliance Of OSHA Regulations
Machinery and assets that are not adequately maintained annually can become a safety hazard for your employees and your customers. In some cases, this can lead to the creation of an unsafe working environment, and if an employee ends up being injured, legal action against your business. Your business can not only face civil legal action from injured parties, but also have to contend with penalties for non-compliance of OSHA regulations. Businesses that are found to have committed serious violations can pay up to $13, 653 per violation.
Deferred Maintenance Means Reduced Efficiency – And Profit Margins
Opting to forgo planned maintenance for your assets means they continue to work in their worn condition. This can hamper the performance and efficiency of your assets, which in turn can drive up secondary costs such as energy costs. A good example is the annual maintenance of a water heater. Experts recommend flushing out a water heater at least once a year. Having it drained and checked can help you get rid of sediment, which is attributed to fluctuating water temperatures and increased energy costs. When compared to the cost of a water heater repair, it is much more cost effective. According to a water heater repair cost guide, the average cost of repairing a water heater is $506. Meanwhile the cost of an annual servicing and flush out is around $100.
There is also the case of emergency repairs. Ignoring planned maintenance can force you to have to perform emergency or reactive maintenance when assets suddenly break down. The cost of hiring an emergency technician and unexpected downtime not only drives up your expenses for that period, but can also cost you customers and reduce your revenue. All of this, when combined, equates to a reduced profit margin.
Ignoring Preventative Maintenance Measures Could Be Driving Your Insurance Costs Up
Insurance premiums can be costly to renew each year. Earlier this year, commercial insurance rates increased yet again, and businesses were left scrambling to plan for the hike in costs. However, the way your business approaches asset management can also influence the insurance rates you are offered – including whether your business performs a rigorous asset maintenance program. Little or no effort made to keep your assets in working and optimal condition will be seen as a boost to the risk, which in turn drives up your insurance rates. This is simply because your insurer is expecting replacement of your asset to occur much sooner without the needed maintenance – and without the planned maintenance it needs, they are often correct.
Finally, sticking to your planned maintenance schedule helps your business to get its budgeting right. Being proactive in maintaining your assets allows you control over planning for those annual costs. However, ignoring them could mean your business is faced with reactive maintenance costs, and in some cases, repairs may not be feasible. So instead of having your technicians spend 80 percent of their time on reactive maintenance, plan a robust asset maintenance schedule, and help your business avoid any unnecessary bottlenecks.
