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Negative Impacts Of Unplanned Downtime

March 8, 2019

Negative Impacts Of Unplanned Downtime

Unplanned downtime is one of the factors why organizations go through operational inefficiencies. As a business, it’s critical for you to understand and realize the true cost of unplanned downtime and what you can do to avoid it. Organizations don’t have the time nor the resources to deal with equipment failure.

In a competitive environment, it’s inevitable to push your production equipment to capacity while decreasing the chances of equipment failure. Your maintenance management team, therefore, can play a key role in optimizing your plant’s operational efficiency.

The cost of downtime

An average manufacturer deals with approximately 800 hours of downtime per year. It will be difficult for you to maintain or improve your bottom line when you have to stop your production processes for more than 15 hours per week. An average automotive manufacturer loses $20K per minute due to downtime. You might be running a small manufacturing plant, but the cost of downtime can still be more than a few hundred dollars per hour.

In a rapidly transforming world where technology keeps changing and reshaping business processes, it’s hard to keep track of hundreds of variables associated with maintenance and decreased downtime. You might feel that it’s out of your control to keep your machines up and running all the time.

The good news is that having a well-thought-out and well-executed preventive maintenance strategy can help your business identify potential problems well before even they take place, helping your business improve profitability and output. Let’s have a look at potential costs associated with downtime and lack of preventive maintenance:

1. Wasted labor

When machines stop working suddenly, your employees who operate those machines become useless which leads to wasted labor costs. In addition to the loss per hour, you are also paying employees for doing nothing. When a major breakdown happens, it can force you to call for all hands on deck to resolve the problem. Such situations lead to nothing but chaos and business losses.

2. Depleted inventory

Many organizations need to maintain a certain amount of products in the warehouse to keep the operation running. Downtimes can quickly deplete the inventory. When there are production limits and you don’t have back up machines to take over in case of downtime, it can take days or even months to catch up.

Stress is a considerable indirect cost that negatively impacts industrial productivity. When a part of your plant stops working, it shifts stress on other parts of the system, which causes further problems. So far as your workers are concerned, stress can lead to errors and lack of efficiency.

3. Loss of production

Loss of production capacity is the most visible and devastating impact of downtime. If your manufacturing unit produces 600 units per hours, with an average of $50 profit per unit, one hour of downtime can costs your company more than $10,000 in lost revenue.

Preventive maintenance is an effective solution

How can you reduce downtime and improve operational efficiency? Preventive maintenance (PM) is the answer. Having an effective preventive maintenance program in place will help you identify and resolve problems before it gets too late. If you’re in Edmonton and need dependable PM services, contact Quality Millwright. We help industries with their maintenance and shutdown needs. Contact us to schedule a PM service now!