Management Insight
Part 1: Repair or replace? Best Strategies to Reduce Maintenance Costs
Part 2: The Consequences of Equipment Failure
Part 3: Lifetime Operation of Motor Costs More than Initial Purchase
The Consequences of Equipment Failure
By Andrew Gager - February 2013 - Maintenance & Operations
If a manager decides to defer needed repairs or replacement, what is the impact of continued failures? In some instances, there is the potential for environmental issues or violations. Safety and health also need to be considered. This includes service disruption, staff comfort, and systems, as well. The criticality to the overall facility of this equipment has a significant impact on the decision-making process.
What costs should we consider? It is important to realize that maintenance costs are only one part of the costs we should consider. Best-practice maintenance organizations consider the�total�cost of ownership when evaluating options. Focusing exclusively on the direct cost will lead to less-than-optimal results. In the case of motors, for example, direct costs include:
- Labor costs of removal installation
- Materials costs for rebuilding, rewinding, or repairing
- Material freight costs, which are commonly at a premium or expedited rate.
But mangers also might consider the other costs:
- efficiency loss
- equipment downtime, including the costs of lost operator wages, utilities and, more importantly, customer service
- customer service or comfort, which is hard to measure but you sure do hear about it!
Repair Or Replace?
When a pump motor fails, managers face a repair-or-replace decision. Many companies use a 50-60 percent rule for repairs or replacement. If a repair cost is more than 50-60 percent of the cost of a new motor, it is not repaired. If the horsepower (hp) of the motor is less than a certain threshold, the motor is scrapped and replaced. A facility policy usually dictates this ratio.
In the case of the pump system, a motor can be rewound at a cost of $1,200-$1,400. Replacing the motor with a new high-efficiency motor would cost about $2,000, and a new premium, high-efficiency motor would cost $2,900. The accompanying chart shows basic calculations when replacing 20 hp motor with energy-efficient motor, considering operating costs.
