With profitability premised upon efficiency, uptime, and compliance, managing assets manually or using legacy systems feels like guiding a ship through a storm with no compass. Maybe you are facing increasing maintenance costs, unforeseen downtime, poor asset visibility or regulatory risk; all of which impact your profit margins.
That said, purchasing EAM software may be perceived as a significant investment, but without it, the organization lacks the proper perspective and control needed to achieve maximum asset performance.
So, how do you measure the success of your investment in EAM?
In this blog, we dive into seven EAM Key Performance Indicators (KPIs) that demonstrate the ROI of your EAM software and offer transparency to gauge the impact on operational excellence, cost savings and strategic decisions.
One of the most compelling indicators of EAM software's effectiveness is the improvement in asset uptime and availability.
Real-time monitoring and predictive maintenance functionality of enterprise asset management software help ensure that equipment is maintained before it breaks.
But if you want to make the most of these functionalities, you should choose enterprise asset management software from professionals who demonstrate relevant certifications and trustworthiness. You can derive meaning only from trusted solutions with the security, integration, and data precision to power real change.
Moreover, automation of inspections, notices about anomalies forthwith and schedule maintenance with minimal disruption, contribute to lower subsequence down times and prolong service periods. With time, this means less downtime, better service delivery and ultimately a greater return on asset investment.
MTBF is a fundamental metric that helps you measure the reliability of your assets in operation over time. An increasing MTBF number is indicative of assets running longer without failure, indicating how well an EAM strategy is executed.
Collecting asset history, failure patterns, and maintenance records allows engineers to perform reliability-centered maintenance (RCM), which increases MTBF. This is particularly crucial in industries such as manufacturing, utilities and transportation, where even short disruptions can have enormous and lasting effects.
As MTBF improves, your organization not only witnesses less maintenance, but its people can spend more of their time moving the organization forward and less on firefighting.
Keeping up with maintenance costs in relation to the ARV can help you determine if your assets are being cost-efficiently maintained or if they need to be replaced to save you money.
EAM software makes that easier by aggregating maintenance-related costs, spare part usage, and labor costs in one single dashboard. That gives facility and operations managers visibility of where they might be overspending and when to move resources.
The benchmark for this metric is generally less than 2-3% for best-in-class players. EAM software allows to benchmark these numbers effectively and flag outlier for analysis.
The timely completion of work orders is crucial for maintaining productivity and ensuring safety.
One potential cause of a high backlog of work orders is poor asset planning or a lack of resources.
EAM solutions facilitate this by automating work order generation, dispatching work to the appropriate technician and tracking completion timelines. This results in quicker everyday maintenance and a more transparent workflow.
Most importantly, you can spot bottlenecks due to being understaffed, running out of a product or scheduling something poorly and can address those things proactively. This ultimately enhances efficiency and achieves compliance without needing to fire-fight.
Better visibility into task status and technician workloads also enables more effective planning, more accurate labor forecasts and improved working relationships across divisions responsible for maintenance.
Any excess inventory results in capital being tied up, while shortages cause delays to repair and increase downtime. That’s why keeping an eye on inventory turnover and stock accuracy is crucial, and EAM software excels here.
With automatic monitoring of part usage, reorder levels, and supplier performance, you have better control of your inventory. Moreover, real-time information ensures accurate forecasts and avoids emergency purchases, which typically are more expensive.
With time, it translates into better inventory management, less waste, and lower storage capabilities. And the most important thing, it ensures that vital components are available when needed, supporting maintenance procedures that are smooth and timely.
Furthermore, the linking of inventory data with maintenance schedule allows anticipating forthcoming needs and avoid overstocking. This integration between planning and supply chain capabilities allows for a more flexible and cost-effective maintenance ecosystem at all levels of operation.
For some industries, asset compliance is not only a best practice, but it's also a requirement. Whether you must adhere to ISO regulations, FDA rules and regulations, or be audited for environmental health and safety, there will be consequences in terms of heavy fines and a tarnished reputation if you fail to comply.
EAM software maintains a centralized database of information related to compliance, certifications, inspection plans and records. It leaves no stone unturned with automatic reminders, audit trails and live compliance dashboards.
With that level of transparency, you not only save time in your audit prep but also improve your standing with regulators and investors.
Plus, the ability to generate reports on demand provides companies with an extra layer of control and preparedness. By capturing all asset-related activities in digital form, businesses can prove compliance rapidly, spot risk early and instill an accountable culture within departments.
Return on Assets is a financial ratio that measures how a company uses its assets to make money.
EAM software helps to increase your ROA by better asset utilization, minimizing unplanned maintenance, and extending asset life through better planning.
When assets are working as efficiently as they can be, churning out revenue, and hanging in with a lower capital cost to keep them up and running, your ROA gets better. Furthermore, the intelligence that can be gained through EAM systems enables leadership teams to strengthen the decision-making process for capital expenditure, budgeting and resource allocation.
Overall, organizations that monitor ROA consistently can measure asset performance against historic trends, establish strategic goals for improvement, and identify disharmonies that are hard to spot.
As you can see, EAM software is more than just a digital logbook for assets; it’s essentially a cost control, performance improvement, and strategic foresight engine.
By focusing on metrics such as uptime, MTBF, maintenance cost, or ROA, you are able to quantify and optimize your investment in asset management.
In a world where every choice you make has consequences, do the talking with your metrics and make sure your enterprise asset management strategy is the leader when it comes to making operations smarter and more efficient.
