Maintenance: the heart of your profit center

4 minutes

Many organizations operate their maintenance and operations departments as cost centers. They’re areas within an organization that need to stick to tight budgets and cut spending as much as possible.

This mindset is driven by a ‘break then fix’ approach within maintenance & operations (M&O), which typically focuses on reactive maintenance. But with increasing pressures on executives to demonstrate ROI across organizations, it’s time to shift your thinking.

However, we should look at M&O as a profit center.

While there are costs for equipment investment and operating expenses, putting your funds in the right place can improve efficiency, naturally resulting in higher profits.

Managers breathe life into the profit center

M&O professionals can significantly increase profitability in many ways. According to Paul Lachance, Senior Manufacturing Advisor for Brightly, managers can boost uptime from 90% to 95% to meet demands for production increases or eliminate inefficiencies that can reduce total M&O costs, helping profitability as much as anyone.

“Maintenance people increase the capacity of your organization,” Lachance explains. “If they maintain equipment properly, they can increase uptime even a few percentage points to meet demands, which can be a huge help to an organization. That’s just one example of why they are core to your profit center. They make an organization grow.”

In universities, hospitals, health systems, factories and government facilities, equipment downtime can have serious financial consequences. The Wall Street Journal reported that unplanned downtime costs industrial manufacturers up to $50 billion annually. For facility managers, this means poor service and substantial costs.

Maintenance is the backbone of any organization, and downtime can equal lost productivity, customers, and profits.

Preventive maintenance reduces heart attacks — leading to profits

Just like how exercising and eating healthy can boost your heart health, preventative maintenance can help generate profits.

By scheduling maintenance on assets or equipment, M&O departments can improve performance, extend asset life and prevent breakdowns. Lachance argues that organizations can significantly minimize downtime and generate substantial savings with a preventive maintenance plan in place.

“If you're catching your maintenance problems early, you use a factor of one,” Lachance states. “But if you catch them later and later, you may reach a factor of five. Your corrective maintenance work orders will cost an average of five times as much as your preventive maintenance orders. In turn, your capital expenditure costs get wildly more expensive because you waited too long. That’s why it’s important to catch problems early.”

But to implement a preventive maintenance approach and kickstart M&O to achieve profits, cost savings and efficiency improvements, asset managers need the right tool to stay on top of health.

CMMS is your doctor, personal trainer and life coach, all-in-one

A computerized maintenance management system (CMMS) can help improve the productivity of your M&O teams by enabling data-based decision-making and automated work order management. CMMS software ensures managers can proactively tackle problems and avoid unnecessary expenses, saving time and money.

There are many places where CMMS will control costs, maximize efficiency and make M&O departments more profitable — far outweighing the costs to acquire the CMMS. Some examples include:  

  • Reducing unplanned downtime of your assets/equipment  
  • Minimizing stock-outs (missing a critical spare part for a work order when you need it most)  
  • Optimizing your team — have the right person for the right job at the right time   
  • For manufacturing and operations professionals, better quality production — reduce scrap and rework  
  • Stretch the life out of your assets and facilities by avoiding costly capital expenses replacing or overhauling prematurely aged equipment  
  • Helping document and enact compliance and safety initiatives

Maintenance is an investment into an organization’s future. Integrating a CMMS into your organization can jumpstart M&O as a profit center.

How Brightly’s CMMS can boost your profit center

Brightly’s industry-leading CMMS software can help increase operational efficiency: 

  • 35–40% improvement in the reliability of your equipment 
  • 28.3% increase in maintenance 
  • 19.4% savings in lower material costs 
  • 17.8% reduction in maintenance, repairs, operation (MRO) inventory 
  • 20.1% productivity reduction in equipment downtime

To learn more about why over 12,000 organizations have trusted our CMMS over the past two decades, schedule a free personalized demo