When you are looking for CMMS software you frequently will have to provide a justification for the purchase in terms of expected costs and benefits. This can be hard to do and quite tedious. You need to understand both the possible costs involved as well as the benefits to make the right decision on not just to purchase CMMS software but the type of product you want as well as the budget you should have for it.
What are the CMMS software costs?
Purchasing and using CMMS software for your maintenance management will incur a variety of costs. These costs are not just financial but are a variety of other costs incurred by your organization covering implementation, training, on-going use and so on.
- Software license costs: This represents the cost of the software license – typically a one-time cost unless you are looking at buying upgrades.
- Ongoing support costs: This will be the cost of software support agreements that will usually involve maintenance and updates from the software vendor. Generally such software support includes updates/ upgrades besides support if you run into issues using the software.
- Consulting & training costs: You may need to get on site consultants (from the software vendor or some other company) to setup the software, perform other configuration or provide training to employees. You need to budget the actual costs for such consulting time plus things like employee time spent learning to use the software, your Information Technology department costs for setting up any hardware or other initial setup and so on.
- Other software & hardware costs: To run the software and its database you will need computers & servers. You may also need to purchase other third-party software to run the system e.g. database software, operating system licenses, web server software and so on. If you are using bar coding you may need to buy bar code readers and other software.
- Annual/ monthly subscription costs: If you are buying Software As A Service (SAAS) where you login and use a hosted solution you will be paying a monthly/ annual fee rather than a one-time license fee. Generally support costs & updates are included with such fees.
- Data migration costs: This involves the cost of transferring data from an existing system or copying data from spread sheets or paper into the new system. While this is something the maintenance team may do themselves there is still a cost due to the labor hours spent doing this. Plant Services magazine has an article “Converting data to a new CMMS might not be as easy as you think” that covers some of the pitfalls.
- System management costs: The costs involved for someone to maintain the software system itself e.g. taking regular backups, set up users, provide help desk support & other administration on an ongoing basis.
What about the benefits?
- Reductions in equipment breakdowns due to better maintenance: Since equipment maintenance will be planned better and preventive maintenance is less likely to be skipped, you should start to see fewer equipment breakdowns over time.
- Reductions in overtime costs due to fewer breakdowns: Fewer equipment breakdowns means fewer maintenance “emergencies” when all hands are needed on the deck to fix things fast. So you should see lower overtime costs since maintenance technicians should be doing less overtime to fix critical equipment that has broken down.
- Improved maintenance backlog management: Maintenance backlog represents outstanding maintenance that has not been done. With CMMS software you will better be able to keep track of maintenance work due as well as items that slipped through the “cracks”. You can learn more about this from “Maintenance Backlog Management For Equipment & Facilities“.
- Reductions in schedule conflicts due to maintenance being planned at the same time equipment is needed by operations: This can be a big benefit. If you have planned critical maintenance on an equipment but it clashes with schedules of production/ operations you are not going to be very popular. Equipment maintenance calendars created from your CMMS software can help you plan future maintenance and reschedule as needed. You can learn more about this from “Equipment Maintenance Calendars & Scheduling Preventive Maintenance“.
- Reduced costs due to longer asset/ equipment life: Due to better maintenance most equipment is going to last longer before it needs to be replaced. This reduces the capital costs of buying new equipment over time.
- Improved inventory management: Better inventory management is a significant source of savings. Due to better maintenance planning you will keep fewer unneeded and possibly expensive spares around, you will reduce delays fixing breakdowns because you do not have spare parts and you will better be able to evaluate part vendors for quality and reliability.
- Improved analysis of problems and better reporting to management: Maintenance software will help you generate statistics on your performance that can be shared with management so that they have better insight into how the maintenance department is doing as well as get warnings on potential problems (e.g. unexplainable maintenance backlog increases, rising equipment maintenance costs, etc.). You can learn more about these statistics and how to use them from “Key Maintenance Management Statistics For Maintenance Planners“.
- Standardization of maintenance work due to task templates: With good CMMS software you can create standard maintenance task templates to create work orders. Instructions on how to complete the maintenance can be standardized in these templates. This makes it easier to train new technicians as well as improve maintenance standards.
- Improved user/ customer satisfaction: Reductions in equipment breakdowns and better planning or preventive maintenance will create a better impression. Maintenance plans are less likely to interfere with operations or delay product delivery.
You can see a sample case study “CMMS justification, benefits & return on investment (ROI)” that actually tells you how to put dollar figures on all the above benefits to help you calculate theReturn on Investment of your CMMS software. An article in Industrial Maintenance & Plant Operation magazine “More Wrench Time, Less Downtime” covers some of the business benefits of having CMMS software.
Looking for suitable CMMS/ maintenance software?
If you are currently looking at trying to justify the costs of buying a CMMS software product you may find it useful to try out the 30-day fully functional trial of the FastMaint software that we have available. It will give you a chance to evaluate the costs and benefits involved in using maintenance management software and hopefully make a better case to your management on why you should purchase it!Download CMMS Software