One of the most important things every professional must consider when making a significant business-related purchase is: what will the return on investment be? Let’s face it—money makes the world go ‘round. If you’re looking for a way to make your maintenance operations more efficient, a computerized maintenance management system (CMMS) may be just what you need. We’re going to talk about how to determine your potential ROI with a CMMS. We’ll also discuss how a CMMS can save your business money.
But first, let’s further describe what ROI is. ROI stands for Return On Investment. In simple terms, it measures how much value you’ve gained from an investment relative to the amount of money invested. To accurately determine your CMMS ROI, you apply the standard ROI formula:
CMMS ROI = (CMMS Value – CMMS Cost) / (CMMS Cost)
“CMMS Cost” in this equation includes the purchase of the software, service, support, and any additional services. “CMMS Value” is the dollar value of savings across all maintenance costs.
Areas of Maintenance Costs
As part of determining the ROI for any project, you must figure out your current maintenance costs before purchasing a CMMS and the estimated, reduced maintenance costs after purchase and installation. “CMMS Value” will be the difference between these values. Examples of maintenance management costs include:
- Work Order Generation, Processing, and Close Out
- Inventory Management and Overhead
- Expedited Delivery Fees
- Condition Audits
- Report Generation
The following are just a few of the questions you can answer to help you calculate these costs:
- How many hours of emergency maintenance do you experience in a week?
- How many hours of lost production time do you average monthly?
- How much time is spent creating and closing work orders each week?
You should add up all known costs, both direct and indirect, for your maintenance operations. A CMMS has the potential to significantly reduce many of these costs.
Value Created with CMMS
Maintenance management software has many capabilities that have the potential to create value (or reduce cost). Over time, this value will lead to a significant ROI.
The ability to automatically create, process, and close work orders rather than using pen and paper or a spreadsheet, can easily save you up to 50%. The time freed up can be used to accomplish more maintenance tasks more quickly, or to reduce overall maintenance labor costs.
In order to complete or fulfill work orders, you need parts and supplies. With a CMMS, you’ll be able to optimize inventory management, saving you up to 50% on excess inventory purchases and expedited delivery fees. Maintenance management software allows you to keep track of inventory counts in real time, as well as send notifications via email when parts are due for reorder.
Numerous costs are associated with on-site equipment condition audits. These costs can include the hourly rate for the contractor’s time, data analysis and reporting fees, and other costs such as additional fees based on the size of your facility, scope of the audit, and the volume of documentation that must be created. With maintenance management software, audits will be faster, easier, and possibly less frequent, saving you up to 80%.
A CMMS keeps detailed equipment records so you can easily check information related to the status of your machines. You’ll also be able to find patterns in reoccurring repairs to help you make more informed decisions about maintaining versus replacing assets, lowering the downtime of your equipment and troubleshooting breakdowns faster, leading to improved asset life and reliability.
Any of this information can be put together through report generation, which costs up to 50% less with CMMS automated reporting capabilities. Self-refreshing dashboards display KPIs (Key Performance Indicators), along with notifications and alerts, which give you insight into the status of your current maintenance work. Built-in maintenance reports, charts, and graphs cover every aspect of your maintenance operations. You can modify reports to meet your needs as they change. User-defined data sets also filter information and sort records.
With all of these savings, your investment in a CMMS will pay for itself in a relatively short time frame.
FTMaintenance Expedites the Payback Period
The payback period is how long it takes to achieve ROI. While individual results will vary, the payback period with FTMaintenance maintenance management software can be as short as 4 months.
FTMaintenance can boast this number because of what we do to expedite the payback period. That’s where our services such as CMMS implementation services and CMMS training come in. We want you to get the most out of FTMaintenance and help to ensure you save as much money as possible. When you become an FTMaintenance customer, we’ll work with you well beyond the installation of the software—we’ll provide you with detailed instructions on how to import your data and train your users on the most important functions of our software. You’ll have unlimited access to our CMMS customer support to answer your questions and assist you in getting comfortable with using FTMaintenance CMMS. When your software gets up and running quickly and users are able to maximize the use of our CMMS features, the payback period becomes a lot shorter.
ROI is something that happens over time throughout your use of FTMaintenance CMMS software. It involves more than making back the money you spent on the software (your “payback”) and occurs when you begin seeing benefits that exceed your cost of investment, which varies for every business. Ready to learn more about how a CMMS can help you reduce costs in all of these areas, ensuring significant ROI? See FTMaintenance CMMS in action today by scheduling a demo.