- Published date: 2 February 2024
- Author: Louise Simpson
Many of the Maintenance heads and team leaders we have been talking to recently are faced with the challenge of establishing their KPIs for 2024. With pressure to ensure they can demonstrate continuous improvement, their KPIs play a vital role in steering their objectives, evaluating performance, and refining processes to enhance asset reliability. With this in mind, we thought we would explore more around best practice for setting KPIs within Asset and Maintenance Management.
Maintenance objectives will vary across industries and organisations, however it is important to align these with broader organisational goals. While the overarching goal for organisational departments is to contribute to success and profitability, aligning objectives with the desired outcomes of your assets is equally important. For instance, in the current economic climate, organisations may focus on reducing costs, and so a common KPI might be to reduce maintenance costs by 5% in 2024. Maintenance KPIs cover various, including but not limited to Asset Downtime, Asset Performance, Planned Maintenance Percentage, Costs, Asset Lifecycle and Emergency Maintenance Work.
Which KPIs should you measure?
Although there are standard KPIs that maintenance teams can follow, only you and your team will know which align with your organisations’ strategic goals the best. Let’s take a look at a few common maintenance KPIs that can help you get started:
- Asset Performance KPI Calculations:
Tracking and managing your assets’ performances gives you the opportunity to identify and solve any problems before they become major issues.
Mean Time Between Failures
The Mean Time Between Failure (MTBF) refers to the time between equipment failures during normal operating hours. MTBF is a basic measure of an assets’ reliability, and increasing this can enhance productivity, whilst optimising the overall maintenance strategy. MTBF is calculated by taking the asset uptime (total time the asset is running), and dividing it by the number of breakdowns that occurred throughout that time period.
MTBF = Total Uptime / Number of Breakdowns
Mean Time To Repair
Mean Time to Repair (MTTR) measures the average time taken to repair an asset or piece of equipment to restore it to its’ normal operational condition after a breakdown or failure. To understand the MTTR, the total downtime due to maintenance should be divided by the number of maintenance actions during a specific period.
MTTR = Total Downtime / Number of Maintenance Actions or Incidents
Overall Equipment Effectiveness
Overall Equipment Effectiveness (OEE) provides a comprehensive measure of how well equipment and assets are performing. OEE is calculated by considering three factors; Availability, Performance and Quality.
OEE = Availability X Performance X Quality
Let’s look at each of these factors:
- Availability – this measures the actual run time of assets against the planned production time, and can be calculated by dividing the operating time by the planned production time.
- Performance – this calculates the efficiency of assets during operations, compared to the ideal speed. The formula for performance is the Ideal Cycle time x Total Count, divided by Operating Time. Ideal Cycle Time refers to the fastest possible time that assets should take to produce one unit under optimal conditions.
- Quality – this represents the ratio of good quality products to the total products produced.
2. Maintenance Costs:
As organisations face new challenges in the current economic climate, reducing operational and maintenance costs may become a key focus for many. There are various calculations you may want to consider, including:
This KPI measures the difference between budgeted costs and the actual costs of maintenance activities incurred during a specific time period. Measuring this will enable you to assess how close your maintenance costs align with your planned or expected expenditures.
Cost Variance = Actual Maintenance Costs – Planned Maintenance Costs
Maintenance Costs as a Percentage of Estimated Replacement Value
The maintenance cost as a percentage of estimated value measures the total cost of maintenance activities as a percentage of the estimated replacement value of the asset or piece of equipment.
MC/RAV (%) = Annual Maintenance Costs / Estimated Asset Replacement Value X 100
The 80/20 Rule, which is also commonly known as the Pareto Principle, can be applied to various scenarios, and is widely used in maintenance management. The rule suggests that approximately 80% of outcomes result from 20% of all causes or inputs for any given event. In a maintenance context, the rule implies that a small number of assets, issues, or failures can have a substantial impact on the overall maintenance efforts, costs and operational performance.
When considering your maintenance strategy, the 80/20 rule is important to include as it enables you to identify critical assets that contribute to downtime and disruptions and encourages you to take a proactive approach to your maintenance activities instead of using a reactive strategy.
How does Agility support you with tracking KPIs?
Reporting in Agility enables users to monitor their maintenance backlog and keep track of work orders. Knowing the status of these will help calculate metrics such as MTBF and planned vs unplanned maintenance work. This helps to indicate high levels of reactive maintenance and will highlight issues that may otherwise go unnoticed. Reports will also provide data that is needed for calculating maintenance KPIs, such as asset downtime, planned vs unplanned maintenance, time spent to complete jobs, and so on.
Inventory management and efficient critical spare parts management are essential for optimised maintenance operations. Tracking spare parts in Agility will ensure you don’t overspend and maintain high levels of stock that aren’t used and will also ensure that critical parts are available and accessible in the event of a breakdown or failure. If this is not properly tracked, operations may be compromised for longer.
If you would like to understand more about how Agility can support your maintenance operations, or if you are an Agility user and require support with your KPIs from one of our expert consultants, please get in touch with your account manager, or email firstname.lastname@example.org and a member of the team will be in touch.