Cost-cutting is a constant challenge for maintenance managers. There is an ongoing need to control and minimize maintenance expenditures in order to cut business expenses. The effectiveness of the maintenance manager depends on their ability to maintain or even increase the equipment’s availability and performance while controlling or reducing maintenance expenses.
Making a budget is an important management task that guarantees businesses have the funds they need to operate. Without the proper system in place, it can be challenging to estimate the amount to budget for maintenance due to the fluctuation of maintenance needs. Computerized maintenance management systems (CMMS) software keeps track of both maintenance tasks and costs in one centralized system.
Without a process in place to gather and evaluate information on equipment, maintenance needs, and costs, an organization can’t change what it’s doing to make it better. Analyzing expenditures in relation to the maintenance budget offers important insight into potential areas for improvement.
A CMMS can assist you with maintenance budgeting in a number of ways, which are detailed below.
Preventive Maintenance (PM) Costs
Costs for preventive maintenance (PM) are easier to forecast because they are scheduled. CMMS software keeps track of the costs associated with the tasks that must be accomplished, the parts that are required, and the employees who will perform the work. Organizations can forecast the expenses of upcoming planned maintenance by scheduling maintenance tasks in a CMMS on the basis of runtime or date-based frequency.
CMMS software can also be used to foresee upcoming needs for preventive maintenance. For instance, you can create PM schedules in advance and budget for such charges in the maintenance budget if your company plans to buy and install new assets. With the CMMS reporting feature, you can identify assets that are under or over-maintained and adjust the preventive maintenance budget forecast accordingly.
Analyzing Maintenance Costs
Reactive and unplanned maintenance due to equipment failure makes it very difficult to forecast parts expenses from year to year. Analyzing collected data for maintenance budgeting is important. CMMS gives you the tools to collect and analyze equipment\asset historical data to help estimate future part costs.
In addition, a CMMS’s history of reactive maintenance work orders can be used to determine why part costs were high or low over a specific period of time. If sufficient historical data is available, you can calculate a general estimate of the cost of spare parts by averaging data over several years. The maintenance budget should then be adjusted accordingly.
Analyzing your budgets in CMMS can help a business with some major decisions such as:
- Determining whether the predicted budget was accurate and, if not, why not. By being aware of this knowledge, further errors can be prevented.
- Using the data gathered to decide whether the maintenance budget has to be increased or decreased.
- Determining whether the budget is sufficient for various maintenance accounts or sectors and reallocating funds as necessary.
- Determining whether the budget is sufficient for various maintenance areas and reallocating funds as necessary.
- Gives users the ability to drill down into data at all levels, including the specific asset and all repair expenses (labor, parts, supplies, and other expenditures) related to it. For accuracy, these can then be aligned with the budget prediction.
Maintenance Cost / Replacement Asset Value
To carry out maintenance tasks, maintenance personnel utilize a variety of resources, such as vehicles, specialized tools, or equipment. These assets eventually reach a stage where repairing them would be prohibitively expensive. You can evaluate the cost of repair versus replacement by tracking maintenance assets in a CMMS.
Managing Maintenance Resources
The workload determines how many employees are needed to do high-quality maintenance. The amount of corrective maintenance compared to preventive maintenance, the number of employee hours spent on maintenance, and other information about your maintenance history can all be managed by CMMS software Get a better understanding if work orders are being completed on time and the size of the work order backlog. Having this information will help you allocate your resources and provide better insights into resource budgets.
Maintenance Budget Tracking
One of the most undervalued aspects of your asset management is your maintenance budget. It outlines the anticipated cost of achieving your annual maintenance goals. The estimated expenses for each form of maintenance and how they relate to various assets should be included.
CMMS software not only provides that data from which to build a maintenance budget, but it also helps you track your performance against budget goals throughout the year.
Interested to see how eWorkOrders maintenance management software can help you manage your maintenance operations and get your budgets under control? Contact us to get your questions answered and a free demo.
