The outsourced asset care service – is this a panacea for the struggling maintenance departments of small to medium-sized enterprises?

Proper and consistent maintenance can make or break businesses. The headline in a local newspaper, Business Day – dated 13/06/2022, reads “Poor performance and degradation of rail and port infrastructure have seen SA’s coal exports drop 20% from about 80 million tonnes in 2017 to about 64 million tonnes in 2021”. All around us we hear of large utilities in South Africa experiencing declining output results that cripple the economy and result in poor service delivery due to a lack of maintenance management. But what about small to medium enterprises (SMEs)? How are they faring in this category?

No matter the size of a business, to create a real competitive advantage an organisation has to achieve optimum performance from its asset base, with simultaneous cost and risk reduction. The lack of a structured asset management programme that consists of formal business processes, with supporting technologies and skilled people to plan and execute the work will result in haphazard, expensive and sometimes ineffective maintenance activities, leaving a business at risk of not fulfilling its vision.

Why an asset care centre service?

Pragma’s Asset Care Centre service (ACC) enables the planning and execution of an effective maintenance management programme through the use of business processes, technologies and people. By combining these elements, our clients embark on a journey of sustainably growing their asset management practices and maturity, ensuring reliable assets and effective operations.

This scalable, co-sourced solution is practical for companies of all sizes. Often SMEs fail to synchronise these elements and when one aspect fails, the maintenance department comes to a grinding halt. This is especially prevalent in SMEs – when for example, key staff members who know the ins and outs of the equipment, production line or the spare parts replacement cycle leave the business.

From firefighting mode to peace of mind

We often hear the statement: “We are constantly in firefighting mode as our equipment controls our maintenance schedules.” When you are caught in the midst of such circumstances, an alternative outcome seems impossible. This dire situation can easily be remedied where maintenance plans and online monitoring (predictive maintenance) can determine when maintenance must be done.

We spoke with Kribban Coopoosamy, a Pragma Business Development Executive, to better understand the benefits of an ACC for SMEs. We also looked at the dynamism of an asset care service and how it can be customised and scaled according to an SME’s requirements and budget.

Processes – the drumbeat of a successful asset management programme

One of the most common challenges facing SMEs is the lack of structured business processes. These processes are often scribbled somewhere on a dust-ridden pinboard or safely stored in “file 13”. Even more alarmingly, some individuals in the team are often the driving force behind the processes and when these resources change positions or leave the business, the processes (and tacit knowledge) are lost. Where documented processes do exist, they can easily break down when one resource fails to do their part, or paperwork is lost. Digitising these processes means that workflow can continue despite people’s movements, and automated system prompts will ensure that workflow continues.

Drilling further down we see that many SMEs do not have structured asset care plans in place. More often than not they operate in a firefighting reactive maintenance environment as opposed to a more stable preventive maintenance environment. Kribban says: “You want to make sure that you get the best out of your equipment. A proper asset care plan needs to be in place to ensure that assets operate optimally for the duration of their expected life cycles, thus negating the need to invest in unnecessary capital to replace poorly maintained assets.”

Consider as well the instance where an SME would produce elements for an OEM (original equipment manufacturer), for example, a motor manufacturer might outsource the manufacture of car seats to an SME. OEMs will then do their quality, safety, and compliance audits to ensure that their chosen component manufacturer is delivering products in line with their standards. SME enterprises need to ensure that they have these processes in place.

OEMs may well give preference to SMEs who endeavour to align their quality standards with the ISO 55000 Standard for Asset Management, as trends¹ indicate an increased uptake in industry with ISO 55000 compliance. Pragma’s business processes and best practices are aligned with ISO 55000 and the Global Forum on Maintenance and Asset Management’s (GFMAM’s) 39 Subjects, which meet international and local accounting reporting standards – all of which will facilitate the SME in obtaining requisite compliance levels with an OEM.

Hands on deck to do the planning and execution

Not having enough available resources can also be another challenge for SMEs. Different factors can play a role here such as the wrong combination of resources, ineffective work processes detracting from actual wrench time and an unqualified workforce. However, sometimes there are just not enough resources or budget to employ a suitably qualified engineer on a full-time basis. In this instance, having an ACC service with an AC engineer coming to site once a week to attend to agreed KPAs to drive improvement, can be more cost-effective than in-house resources. The AC engineer will review reports, identify problem areas and carry out root cause analysis to isolate and improve on problem events. The AC engineer also has access to all of Pragma’s IP and best practices resources they can draw on, to better serve the client on their asset management journey. Furthermore, the AC Manager will have monthly meetings with the client to review reports and make recommendations for improvement ensuring compliance with the service level agreement (SLA).

Using accredited contractors that are centrally managed by the ACC can also largely extend the workforce of an SME. Pragma’s repository of contractors is shared between clients which lead to cost savings and improved efficiency as specific service level agreements govern their performance and cost structures. No full-time employment is required and these resources are only paid when they work.

Systems and applications streamline processes

The value of the right combination of technologies can no longer be disputed. Gone are the days when Excel spreadsheets and project plans sufficed. Having a proper maintenance management system that can store asset-related data and be used to plan and activate work processes is non-negotiable. Such systems play a crucial role in creating greater efficiency, generating data history to extract valuable insights to improve asset care plans, and making decisions around asset replacements and budget planning.

Central to the ACC is a reputable enterprise asset management system (EAMS). Where the client’s EAMS is used, a thorough analysis will be performed to determine if it has been correctly configured to deliver the required maintenance support and reporting functionality. We will also make improvement suggestions to ensure that best practices and processes can be supported and executed. Where such a system is severely lacking, the client could consider using Pragma’s best-of-breed On Key EAMS and its associated work management applications.

Validating the cost of an ACC

Measures give you information to act upon

The reason we measure key performance areas is to: confirm that everything is under control, to decide which option to take, or to improve something.
To assess the current asset management maturity of the business compared to the desired maturity target, Pragma conducts an Asset Management Improvement Planning (AMIP) executive assessment. With this information, a set of activities is defined in support of improving asset performance to the desired maturity.

Once the gaps have been defined, a consensus mapping takes place to agree on what the client needs to focus on. Here we combine our expertise with the client’s experience of their day-to-day operations and provide guidance in terms of what key performance areas they should start with. There will be additional gaps, as per those defined in the Executive Assessment – but with an SME it is all about focusing on the critical few during the first six months of setting up the ACC service. Once the key KPAs have been identified, the deliverables are customised and formalised in a service level agreement. An SME also has the advantage of being more agile in decision-making, the SLA is reviewed and adjusted after six months, thus keeping the ACC service adaptable and relevant to the client’s needs.

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Kribban concludes: “Our goal is to partner with the client on their asset management journey and provide a customisable and scalable ACC service that will allow them to keep to production targets, minimise unplanned downtime, thereby improve their bottom line.”

Can your enterprise afford not to use our asset care service?

Reference cited in this article: [1]  Impact of ISO 55000 on Organisational Performance