With rising material and energy costs, a new study from ABB shows the bottom-line impact of system breakdowns and explores how industries can shift to a more intelligent repair planning system.
The global report, based on a survey of 3,600 senior decision-makers, finds that 55 per cent of respondents have a strategic and proactive plan to modernise facilities and manage out obsolete components like old motors and drives.
In Australia specifically, 200 local decision-makers reported that figure to be 53 per cent.
Despite growing awareness, the data highlights that 45 per cent of industry leaders in Australia experience equipment-related interruptions at least monthly, with 13 per cent reporting stoppages every single week – implying major financial and operational risks.
The majority estimate these sudden disruptions cost anywhere from $US10,000 up to $US500,000 ($759,503.50) per hour.
“Unplanned downtime is costing Australian businesses an average of $281,879 per hour, affecting over 40 per cent as frequently as every month. Companies that aren’t investing in their life-cycle strategies are missing out,” ABB local division manager Peter Borg said.
“This report shows that businesses still have gaps in their life-cycle management and modernisation strategies. Our research has shown that shifting from reactive approaches to strategic, long-term planning is essential to reducing failures and disruptions.”
The report reveals key gaps between planning and execution, common around the world. While 55 per cent of global industry players claim to have a proactive modernisation strategy, only one in five of those grappling with weekly interruptions actually implement such a plan.
Globally, cost remains the top barrier to modernisation for 28 per cent of industrial players, whilst in Australia, a higher 34 per cent of businesses consider it the top consideration.
Based on what has been seen in the field, businesses have been advised to consider overall costs – like downtime – instead of simply the cost of equipment.
“For example, in coal mines and underground sites, it can be very costly to transport in and handle large and bulky equipment. With modernisation, it’s much easier and safer to transport and install the smaller, modular parts and materials,” ABB east coast field service engineer Thuong Nguyen Tinh said.
Of those who have undertaken an upgrading and retrofitting project in the last two years, just over one quarter explicitly did so to reduce stoppage risks – highlighting that the link between continuous life-cycle management and operational reliability is still not fully understood or acted upon, even by many modernisation proponents.
“Expected downtimes for modernisation projects are greatly reduced, and businesses can immediately experience benefits such as more precise control and improved reliability,” Nguyen Tinh said.
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