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CMMS Software ROIWith personal and business, we are wired to consider the return on our investments.  From a new AC system at our homes to our business software purchases, we need the ROI measurements to base our decisions.  It’s especially difficult when you consider buying CMMS Software for your organization.  As with most measurements, ROI has a formula.  It looks fairly simple:  ROI= (Value — Cost) / Cost

I’m not trying to bring up algebraic nightmares of high school math class, but figuring out a CMMS Software ROI is a little more detailed than equations. Consequently, to determine value, you must determine the areas it will reduce costs by looking at your maintenance data.

The maintenance data defined:

  • Increased Asset/Equipment Lifespan– assets produce income when they enter the workforce, therefore, profitability increases once you recover the asset cost and extend asset/equipment life beyond that point.
  • Reduced Asset Downtime– monitored asset downtime can find gaps in preventative maintenance, facilitate changes, and help determine the steps needed to improve and identify potential problems before they happen.
  • Improved Inventory and Parts Information – associated inventory parts on work orders and asset records provide full cost tracking.
  • Increased Productivity – CMMS software combines and effectively utilizes your staff, documents, work orders, assets, and inventory thereby increasing productivity across the board.

The measurements you need to determine a CMMS Software ROI are ironically the exact measurements the software provides.  A CMMS shows the long-term commitment of funds, labor, equipment purchase, and changes that will benefit your organization for years.   So, if you can’t effectively measure the ROI in dollars and cents, you analyze the cost benefits.  Primarily, will the benefits exceed the costs?   Uncovering the benefits of a CMMS is simpler than measuring the dollar value of an ROI calculation.   To do this, you assess your organizations tangible and intangible benefits carefully.

What are the tangible benefits to consider when considering a CMMS Software?

  1. Decreased or eliminated manual processes- Let’s face it, automation makes life easier. The biggest benefit of CMMS Software if workflow automation.  Automatically generate and assign work orders, get status updates, send managers reports and stop wasting time gathering data for monthly reports.  Free up time to focus on operating and maintaining your equipment.


  1. Reduced downtime- Unscheduled breakdowns wreak havoc on a workday. It’s not hard to make a case for PM when you can plainly see the results of unplanned downtime such as overtime, production loss, and your bottom line.


  1. Extended asset lifespan – It’s a fact when you take care of your things, they last longer. Without preventative maintenance, your assets useful life decreases and on the flip side, PM increases asset life by 20%.  Measure a small test group of equipment that did have PM performed and some that did not.


  1. Increased productivity– When we make plans we are more productive. Effective scheduling ensures you get the best labor value and things won’t slip through the cracks.  Overtime is eliminated because work is planned and coordinated for your technician’s workday.  A CMMS Software tracks due dates, completion status, and can automatically generate performance reports to keep you in the loop.


  1. Reduced maintenance costs– Reaction or action, those are the options. It becomes costly when technicians are reacting instead of preventing breakdowns because corrective maintenance costs will always be higher than planned maintenance.  Just think of a vehicle that isn’t maintained, it’s a no-brainer.  Whereas preventative maintenance has an upfront cost, reaction maintenance will quickly add up and overtake PM costs.


  1. Go paperless – Paper may work for the immediate need, however; the record keeping is spotty at best. Moving away from paper means your information is in one central location that is continually tracked and measured. You can’t efficiently round up paper data, much less have accurate reporting.  Having a more dynamic, paperless system is becoming the more affordable option.


  1. Make data-driven decisions– If you don’t have the data, you can’t make informed decisions. CMMS software will enable better decisions with powerful reporting.  Work order and maintenance records help you measure asset performance because monitored work equals improved processes and stops the inaccurate guessing game.

Stay tuned next week to learn the intangible benefits as well as, the direct and indirect costs.  

To learn more about Novo Solutions CMMS Software ROI, please call today and set up a brief tour of ShareNet.