$119 Billion Lost Annually: The Cost of Reactive Maintenance in Manufacturing

According to IBM, reactive maintenance costs manufacturers USD 119 billion annually. In this outdated approach, technicians rely on years-old databases and spreadsheets to fix broken machinery, causing inefficiencies and time-consuming repairs. Vishal Rane, Sustainable Facilities and Asset Management Product Manager at IBM, believes companies are leaving money on the table by not adopting a more modern approach.

Companies like utilities, transportation infrastructure, and oil and gas industries are negatively impacted by reactive maintenance practices. Not only do they increase repair costs, but also cause unplanned downtime, create safety risks, and damage the environment. A recent study by ABB found that unplanned downtime costs industrial companies a minimum of USD 10,000 per hour, while another Siemens report estimated that the world's top 500 companies lost roughly USD 1.4 trillion annually to unplanned downtime.

Rane emphasizes the importance of caring for assets over their entire lifecycle, as emphasized by ISO 55000, the industry standard for asset management. Instead of relying on a break-fix approach, he suggests considering everything done for an asset from inception and planning to procurement, operation, execution, and retirement. Jetté agrees that teams should think about responsibilities as part of an integrated whole rather than disconnected tasks.

Jetté's three-part framework includes the Frame stage where teams reframe their work, focusing on overall value and creating a digital twin for virtual representation of assets. The Run phase involves executing this plan, optimizing asset performance using computerized maintenance management systems or enterprise asset management software. By adopting this modern approach, companies can see significant savings in the long run.