Repair and maintenance of equipment to allow equipment to perform its intended operations with minimal downtime is critical to the success of an equipment fleet.  Repair and maintenance costs as a measure of enterprise activities provides a metric calculating a ratio of the investment in repairs and maintenance to the enterprises’ construction revenues.

The metric is measured by dividing Equipment Repair & Maintenance Costs (a) by Total Construction Revenue (b).

a.       Equipment Repair & Maintenance Costs

                                                               i.            Includes all equipment operating costs, including but not limited to, repair labor, service truck/welder cost, repair parts, tires, wear items, outside repairs, supplies and consumables. 

                                                             ii.            Note:  While companies may have some differences in accounting for burdens and indirect shop costs, this standard includes the following costs in ‘repair labor’:   labor, payroll taxes, burden (e.g. health insurance, vacation, PTO, life and disability, etc) and indirect/allocated shop overhead costs. 

                                                           iii.            Includes all equipment repair & maintenance costs charged to equipment and jobs except ANA (see iv. below).

                                                           iv.            Exclude (1) fuel and ownership costs and (2)  costs that are considered ANA (Accident, Neglect and Abuse) :  damage caused by operators, third parties, theft or vandalism.

b.       Total Construction Revenue = the value of all services recognized under construction contracts by a company in a period. 

c.       Include mobile construction equipment (off-road and on-road) and non-propelled marine equipment whose hours can be measured (i.e. barges, float systems). Do not include repairs or revenues related to fixed plant equipment or non-construction operations machinery in either the numerator or denominator.  Additional notes:  1)  The goal is to match revenues with expenses and the equipment fleet used to generate those revenues.  2)  Exclude any internal material transfers.

Example:  EQ RM% of Rev  = Equipment Repair & Maintenance Costs / Total Construction Revenue =  $350,000 / $10,000,000 = 3.5%

Repair and maintenance of equipment to allow equipment to perform its intended operations with minimal downtime is critical to the success of an equipment fleet.  Repair and maintenance costs as a measure of enterprise activities provides a metric calculating a ratio of the investment in repairs and maintenance to the enterprises’ construction throughput (as defined below).  Further, utilizing Construction Throughput as a denominator may provide greater consistency compared with Metric 1 if companies have supplemented their forces with subcontractors due to different work mix, expansion/contraction in revenues, etc.

The metric is measured by dividing Equipment Repair & Maintenance Costs (a) by Throughput (c).

a.       Equipment Repair & Maintenance Costs

                                                               i.            Includes all equipment operating costs, including but not limited to, repair labor, service truck/welder cost, repair parts, tires, wear items, outside repairs, supplies and consumables. 

                                                             ii.            Note:  While some companies may have some differences in accounting for burdens and indirect shop costs, this standard includes the following costs in ‘repair labor’:  labor, payroll taxes, burden (e.g. health insurance, vacation, PTO, life and disability, etc) and indirect/allocated shop overhead costs. 

                                                           iii.            Includes both costs charged to equipment and jobs except ANA (see iv. below).

                                                           iv.            Exclude fuel and ownership costs and (2) costs that are considered ANA (Accident, Neglect and Abuse) :  damage caused by operators, third parties, theft or vandalism.

b.       Total Construction Revenue = the value of all services recognized under construction contracts by a company in a period. 

c.       Throughput = Total Construction Revenues – Material Costs – Subcontract Costs

d.       Include only construction equipment (off-road and on-road in the above calculations) and non-propelled marine equipment whose hours can be measured [i.e. barges, float systems]).  Do not include repairs or revenues related to asphalt material plants, quarries or non-construction operation machinery in either the numerator or denominator.

Example:  Eq RM% of T = Equipment Repair & Maintenance Costs / (Total Construction Revenue – Subcontract Costs – Material Costs) = $350,000 / ($10,000,000 - $750,000 - $1,500,000) =   4.52%.

Repair and maintenance of equipment to allow it to perform its intended operations with minimal downtime is critical to the success of an equipment fleet.  The equipment fleet includes all heavy construction equipment, on-road vehicles, small equipment and attachments. Repair and maintenance costs as a measure of fleet activities provides a metric calculating a ratio of the investment in repairs and maintenance to the total enterprises’ estimated replacement value of owned equipment (as defined below).  

The metric is measured by dividing Equipment Repair & Maintenance Costs (a) by Estimated Replacement Value (b).

a.       Equipment Repair & Maintenance Costs

                                                               i.      Includes all equipment operating costs, including but not limited to, repair labor, service truck/welder cost, repair parts, tires, wear items, outside repairs, supplies and consumables.

                                                             ii.      Note:  While some companies may have some differences in accounting for burdens and indirect shop costs, this standard includes the following costs in ‘repair labor’:  labor, payroll taxes, burden (e.g. health insurance, vacation, PTO, life and disability, etc) and indirect/allocated shop overhead costs. 

                                                           iii.      Includes both costs charged to equipment and jobs except ANA (see iv. below).

                                                           iv.      Exclude fuel and ownership costs and (2) costs that are considered ANA (Accident, Neglect and Abuse):  damage caused by operators, third parties, theft or vandalism.

b.       Estimated Replacement Value is the amount that the enterprise would need to spend to replace its construction equipment assets at the present time (i.e. like kind equipment replacement based upon its current age and condition).  ERV is not the cost to replace your fleet with new equipment.

                                                               i.      Includes owned fleet of equipment

                                                             ii.      Includes Right of Use Assets under ASC 842 (i.e. capitalized leased equipment)

                                                           iii.      Include only construction equipment (off-road and on-road in the above calculations) and non-propelled marine equipment whose hours can be measured [i.e. barges, float systems]).  Do not include repairs or revenues related to asphalt material plants, quarries or non-construction operation machinery in either the numerator or denominator.

 

Example:  Eq RM% of ERV = Equipment Repair & Maintenance Costs / Estimated Replacement Value = $350,000 / $3,500,000 = 10.0%.

Repair and maintenance of equipment to allow it to perform its intended operations with minimal downtime is critical to the success of an equipment fleet.  Repair and maintenance costs as a measure of enterprise activities provides a metric calculating a ratio of the investment in repairs and maintenance to the enterprises’ revenue.

The metric is measured by dividing Equipment Repair & Maintenance Labor (a) by Total Construction Revenue (b).

 

a.       Equipment Repair & Maintenance Labor (i.e. Repair Labor) = the value of both internal and outside labor.  Internal labor cost should include wages, payroll taxes, benefits, overhead [standard / fully burdened rate].  Outside labor should include the labor portion of outside repairs.  Include all repair and maintenance labor, including but not limited to, internal shop, outside labor, construction field labor performing repairs.

b.       Total Construction Revenue = the value of all services recognized by a company in a period.

c.       Include only construction equipment (off-road and on-road in the above calculations) and non-propelled marine equipment whose hours can be measured [i.e. barges, float systems]).  Do not include repairs or revenues related to asphalt material plants, quarries or non-construction operation machinery in either the numerator or denominator.

Example:  Eq RML% of Rev = Equipment Repair & Maintenance Labor / Total Construction Revenue = $165,000 / $10,000,000 = 1.65%.

Repair and maintenance of equipment to allow it to perform its intended operations with minimal downtime is critical to the success of an equipment fleet. %RML of RM provides the share or ratio of equipment repair & maintenance labor to its overall equipment repair and maintenance costs. In other words, the relative share of labor to parts and other repair costs.

The metric is measured by dividing Equipment Repair & Maintenance Labor (a) by Equipment Repair & Maintenance Costs (b)

 

a.       Equipment Repair & Maintenance Labor (i.e. Repair Labor) = the value of both internal and outside labor. Internal labor costs should include wages, payroll taxes, benefits, overhead [standard / fully burdened rate].  Include all repair and maintenance labor, including but not limited to, internal shop, outside labor, construction field labor performing repairs.

b.       Equipment Repair & Maintenance Costs

                                                                     i.            Includes all equipment repair and maintenance costs, including but not limited to, repair labor, service truck/welder cost, repair parts, tires, wear items, outside repairs, supplies and consumables.

                                                                   ii.            Note:  While some companies may have some differences in accounting for burdens and indirect shop costs, this standard includes the following costs in ‘repair labor’:  labor, payroll taxes, burden (e.g. health insurance, vacation, PTO, life and disability, etc) and indirect/allocated shop overhead costs. 

                                                                 iii.            Includes both costs charged to equipment and jobs except ANA (see iv below). 

                                                                 iv.            Exclude (1) fuel and ownership costs and (2) costs that are considered ANA (Accident, Neglect and Abuse):  damage caused by operators, third parties, theft or vandalism.

 

Example:  Labor RML% of RM = Equipment Repair & Maintenance Labor / Equipment Repair & Maintenance Costs = $165,000 / $350,000 = 47.14%.   

 

Return on Net Assets (RONA) is a measure of financial performance which demonstrates how well a company is deploying its assets to generate earnings.  

 

It is measured by dividing Net Income Before Taxes (a) by [Net Working Capital (b) + Net Book Value of Fixed Assets (c)].

 

a.       The company’s income before income taxes

b.       Net Working Capital = Current Assets less Current Liabilities

c.       Net Book Value of Fixed Assets - Represents the original cost of an asset less its accumulated depreciation in accordance with Generally Accepted Accounting Principles (GAAP).

                                             i.            Include all company construction equipment assets and operating assets such as asphalt plants. 

                                           ii.            Include Right of Use assets for all leases capitalized under ASC 842, net of accumulated amortization

                                         iii.            Exclude real estate, quarries, material reserves. 

 

Example:  RONA = (Net Income Before Income Taxes ) / ([Net Working Capital <Current Assets – Current Liabilities>] + [Net Book Value of Fixed Assets <Fixed Asset Cost – Accumulated Depreciation>]) = ($350,000 + $150,000) / ($3,250,000 - $1,950,000) + ($2,550,000 - $1,000,000) =        17.54%.

The ratio of annual Capital Expenditures to Free Cash Flow is a ratio which measures the efficiency of and return on the deployment of capital.  It is measured by dividing Capital Expenditures (a) by Free Cash Flow (b).

a.       Capital Expenditures represent the total cost capitalized during a period on the company’s balance sheet to acquire equipment.  Includes both fixed assets and Right of Use assets under ASC 842.

b.       Free Cash Flow – for purposes of this definition we are defining free cash flow as Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA).

Example:  CAPEX/FCF <Net Income + Interest Expense + Tax Provision + Depreciation + Amortization> = $800,000           / ($350,000 + $40,000 + $150,000 + $375,000 + $5,000) =              0.87.

 

The Goal of this metric is to compare your internal charge rate to the external rates charged by your dealers and other maintenance contractors.

a.       Average Internal Hourly Shop/Field Rate is your internal loaded or standard rates - this rate is based on your Complete Budget for the Shop and Equipment Management and Field positions charged to your Equipment. The costs included in calculating this rate should be consistent with the definition included in equipment maintenance and repair costs.  Internal Rate is calculated by establishing the total costs budgeted for your shop and field mechanics (numerator) divided by Direct hours charged to equipment (denominator). The vehicle costs for the field mechanic are separated as the usual External Contractor charges a mileage rate in addition to the Standard Rate.

b.       Average External Hourly Shop / Field Rate is the average rate for your external contract labor which is charged to your equipment.  Do not include service truck or mileage charges. 

c.       Example: 

                                                               i.      Company Mechanic Internal Rate - $ 105 per Charged Rate

                                                             ii.      External Mechanic Rate (Average of Dealers/Others) $145 Per charged hour

The Goal of this metric is to establish a comparable basis of equipment costs by cost component. Equipment Cost Components are categories or cost “buckets” used to establish the Rates for your equipment. The typical hierarchy includes Ownership, Repair and Maintenance, and Fuel cost types. The metric provides standard data for comparison while recognizing there is a difference in operating hours between the different areas of the country. 

This metric includes the following cost components as defined below:

a.       Ownership Costs – Depreciation, lease payments for Right of Use assets under ASC842, equipment rental expense (including taxes and fees), insurance, licenses, property taxes and interest.

b.       Repair & Maintenance Costs

                                             i.            Includes all equipment operating costs such as repair labor, service truck/welder cost, repair parts, tires, wear items, outside repairs, supplies and consumables.

                                           ii.            Note: While some companies may have some differences in accounting for burdens and indirect shop costs, this standard includes the following costs in ‘repair labor’:  labor, payroll taxes, burden (e.g. health insurance, vacation, PTO, life and disability, etc) and indirect/allocated shop overhead costs. 

                                         iii.            Includes both costs charged to equipment and jobs except ANA (see iv below). 

                                         iv.            Exclude (1) fuel and ownership costs and (2) costs that are considered ANA (Accident, Neglect and Abuse):  damage caused by operators, third parties, theft or vandalism.

c.       Fuel

                                             i.            Includes all fuel costs including fuel, additives and delivery cost

                                           ii.            Includes diesel exhaust fluid

d.       Total Equipment Costs = the sum of the a. + b. + c. above

 

Example:  Cost component %’s are calculated as follows: 

Ownership	$500,000	40.0%
Repair & Maintenance	$350,000	28.0%
Fuel	$400,000	32.0%
Total	$1,250,000	100.0%

 

 

Utilization measures the time a machine is actually working relative to the time it is on site, expected to work and able to work. Utilization is a critically important but badly understood metric. The calculations involved are based on the operating status of a machine and can be defined as follows:

a.       Working (W) - The machine is on site, able to work and is being used to complete required work. 

b.       Planned Hours (P) – This represents the planned hours for a machine or group of machines for a particular time period. Generally, this would represent the budgeted hours in the annual hours budget or hours per year in the Ownership & Operating Rate calculation. If hours are budgeted by project, the hours for that project for the year could be utilized.

c.       Down Time (D) - The machine is not working or producing as a result of an unplanned equipment breakage or failure or planned maintenance activities.

d.       Clarifications – Utilize working hours of mobile equipment included in the utilization calculation (i.e. Off-Road,  On-Road construction equipment and non-propelled marine equipment whose hours can be measured [i.e. barges, float systems]).  Exclude fixed plant equipment, non-construction operations machinery, pick-up trucks, small equipment [ex. Welding machine, compressors, saws, trench boxes, attachments, etc]).   For purposes of external comparative metrics, this will be measured for an annual period. For purposes of internal comparative metrics, it can be broken down by groupings of machines (i.e. by equipment type, project, etc.) or for shorter time periods.

 

% of Planned Equipment utilization is measured by dividing the time machines is actually working (W) by the time machines are planned to work (P).

 

Example:  % Planned Utilization = Working Hours / Planned Hours = 22,247 / 37,500  = 59.3%.

 

The metric of Planned Utilization is frequently broken down into two components:  Utilization and Availability.  Utilization measures the amount of time the machine has worked (W) as a percentage of the time it was up and running and able to work (P - D).  Availability measures the amount of time the machine was up and running and able to work (P - D) as a percentage of the planned time (P). Sample calculations are as follows:

·       Utilization = W/ (P-D) = 22,247 / (37,500 - 600) = 60.29%

·       Availability = (P - D) /P =  (37,500 - 600) / 37,500 = 98.4%

Fleet utilization measures the degree to which a group of machines working at a given location for a given time is able to generate the internal job charges that could be generated if all the machines within that group were to work at the desired or optimum level of utilization.

 

It is measured by dividing the total job charges actually generated by a group of machines working at a given location for a given period by the total job charges that could have been generated by that group of machines if they had worked at optimum utilization for the given period.

 

Example:

 

Engine idle % is a measure of the time that an engine is running without performing a task. This statistic is derived from telematics or other electronic information using algorithms to determine engine idle percent which is communicated through the telematics platform being used.  

 

It is designed to show the relationship between the period the machine and/or its engine is “at idle” relative to the sum of the time the machine and/or its engine is “at idle” plus the time the machine and/or its engine is “not idle”.

 

It is measured as follows by dividing the total Hours that the machine is reported “at idle” by telematics by the total Meter Hours reported by telematics.

 

Example:  Engine Idling % = Hours Reported at Idle / Total Meter Hours Reported = 5,375 / 27,622 = 19.46%.

 

This metric must be used with great care and with full knowledge of the fact that:

                           i.            Results are produced by sensors and algorithms that are often proprietary and vary by supplier, manufacturer and, in some cases, by machine type.

                         ii.            Engine idle % is best used to compare assets that are performing similar tasks. Comparing the idle time of a wheel loader that is loading trucks at an aggregate quarry yard to a maintenance truck that has a PTO driven air compressor will produce drastically different results. By comparing similar assets that are performing similar tasks one can establish baselines and develop plans and procedures for improvement.

                       iii.            Engine idling, while often a waste, is a natural, unavoidable and in many cases a desirable part of every construction process.

                        iv.            Alternate calculation method – If telematics are not available on a particular machine or all machines for that matter, then an alternate is as follows:

o   Subtract reported working hours from total metered hours and then divide by the total metered hours for a set period. This method will require that the operators record their starting and stopping hour meters regularly.

§  Example:  Engine Idling % = (Total Meter Hours – Total Working Hours) / Total Working Hours = = (500-400)/500 = 20.00%

Equipment Damage $ are the costs to Repair/Rebuild equipment or its components for Accidents, Neglect & Abuse (ANA) .  Do not include standard wear and tear or costs included  in the composition of the Equipment Rate.   Do include repairs for damage charged to a job, or charged to a department or not covered by Insurance. 

a.       Example -- Total Equipment Damage Costs Total $150,000 / Total Man hours 350,000 = $.42 cents per Man hour

TRIR is the number of recordable incidents per 100 full-time workers during a one-year period. Shop TRIR looks at the number of total recordable incidents and compares it to the number of total hours worked by shop employees in a single year. In this case, a recordable incident is any work-related injury and illness that results in death, loss of consciousness, days away from work, restricted work activity, transfer to another job, or medical treatment beyond first aid.

Note:  For purposes of this metric all employees primarily employed by the Equipment Maintenance Department or operation shall be included in this metric. Please include mechanics, lowboy / drivers reporting to the shop, parts drivers/pickers and support personnel.

 

a.      Number of Shop Recordable Incidents x 200,000 / total number of shop man hours worked in a year. The 200,000 is the benchmark established by OSHA because it represents the total number of hours 100 employees would log in 50 weeks based on a 40-hour work week.

a.      Example: 2 shop incidents / 124,800 shop man hours worked = 2 X 200,000/124,500 = 3.21

Preventive Maintenance (PM) are all tasks that are routinely or repetitively scheduled with the intent of prolonging the life of an asset

Predictive maintenance is a technique that uses data analysis tools and techniques to detect anomalies in the operation and possible defects in equipment so they can be fixed before resulting in a failure. They measure changes in condition normally by use of technology or statistics. Predictive maintenance tends to include direct measurement of the item.

a.       Total Maintenance Hours spent on PM and PdM divided by total maintenance hours in any given period.

b.       Example: If there are a total of 1,200 maintenance hours logged in a month and 250 of the hours are spent on PM and PdM, then the percent of the maintenance hours that are PM/PdM is 21%

·       PM/PdM hours = 250 / 1,200 = 21%

Preventive Maintenance (PM) are all tasks that are routinely scheduled with the intent of prolonging the life of an asset.  PM percent of work orders are the number of work orders for PMs compared to total of all work orders.

Predictive maintenance is a technique that uses data analysis tools and techniques to detect anomalies in the operation and possible defects in equipment so you can be fixed before resulting in a failure. They measure changes in condition normally by use of technology or statistics. Predictive maintenance tends to include direct measurement of the item.

a.       Total Maintenance Work Orders spent on PM and PdM divided by total maintenance work orders in any given period.

b.       Example: If there are a total of 852 maintenance work orders logged in a month and 256 of those work orders hours are spent on PM and PdM, then the percent of the maintenance work orders that are PM/PdM is 30%

·       PM/PdM hours = 256 / 852 = 30%

 

%CP is that Corrective Maintenance activity that arose from PM or PdM activity or inspections. The assumption is that if proper PM and PdM is performed, issues or deficiencies should be surfaced that need to be corrected.

a.       %CP = Total Preventive or Predictive Maintenance Work Orders / Number Corrective Maintenance Work Orders  

b.       Example: 26 Corrective Work Orders from PMs and PdMs/ 197 Total PM Work Orders = 8:1 ratio or 13%

 

 

Planned maintenance is defined as PM or Corrective Maintenance that has been scheduled with labor or/and parts and labor. Planned maintenance is determining the type of work required to resolve an issue and how it must be done. Planned maintenance works to identify all the necessary labor, items and materials needed to solve the issue. This includes equipment inspections, ordering parts, gathering specialty tools, locating reference documents; and prioritizing projects. High planned maintenance percentages increase wrench time (productivity) and lowers reactive maintenance (breakdowns). 

a.       % Planned = Number of Man Hours Planned and Prepped / Total Man-Hours of Available Work

b.      Example: % Planned = Planned Maintenance Hours / Total Maintenance Hours = 600 hours Planned / 1280 Total Maintenance Man hours = 47%

Preventive Maintenance (PM) are all tasks that are routinely or repetitively scheduled with the intent of prolonging the life of an asset

PM schedule compliance measures the number of preventive maintenance tasks completed, on time, within an allocated allowance as compared to the PM maintenance tasks scheduled.

a.       It is calculated by dividing the total number of work orders (PM and PdM) completed on-time, within an allocated allowance, by the total number of work orders scheduled for that period.

b.       Example: If there were 480 total maintenance work orders planned and scheduled this month and 320 were completed within the week they were due, the PM Schedule Compliance would be 67%

c.       320 / 480 = 67%

Maintenance Schedule Compliance measures the percentage of work orders completed by the due dates over a period, often within one week. 

It is calculated by dividing the total number of work orders completed on-time within an allocated allowance by the total number of work orders scheduled for that period.

a.       It is calculated by dividing the total number of work orders completed on-time, within an allocated allowance, by the total number of work orders scheduled for that period.

b.       Example: If there were 275 total maintenance work orders planned and scheduled this month and 220 were completed within the week they were due, the Schedule Compliance would be 80%

c.       220 / 275 = 80%

Maintenance backlog is a list of outstanding tasks that have been identified but not yet performed to repair or maintain equipment.

These tasks remain on the list and open until they are completed.

Backlogs are measured by the estimated time it would take to complete all tasks on the list. This value is most often calculated in man-weeks or work weeks for the number of mechanic work weeks.

1.      Only work to be performed by the maintenance group that is reporting is included. This means work performed by outside contractors or vendors who are not usually on site is not included.

2.      PM and PdM work is included out to the normal scheduling horizon, usually five to 12 weeks. Assuming that the flow of PM/PdM work is uniform, this moving line will include the work that is currently being planned and scheduled, but not a whole year’s worth of condition monitoring.

3.      Standing or recurring work orders, if used, should be broken into weekly chunks that are entered into the backlog.

4.      Maintenance backlog in weeks = Total Man-Hours of Available Work / Number of Man-Hours’ Weekly Capacity

5.      Example: 1,400 hours of open work orders / (14 mechanics x 50-hour weeks) = 2 man weeks

 

Maintenance Labor is to include all normally scheduled hours for the maintenance staff.

Overtime are those hours in excess of what is normally scheduled

a.       Maintenance Overtime % will be the total technician hours less regularly scheduled hours divided by regularly scheduled hours

b.       Example: If you have 4 technicians who are regularly scheduled to work 50 hours/week/individual and at the end of a 4-week period you have a total of 900 maintenance hours worked then your percent of maintenance labor overtime is 12.5%

·       Regularly scheduled hour = 4 x 50 x 4 = 800

·       900 – 800 / 800 = 100/800 = 12.5%

Rework is any task that requires the same repair within a month or 176 metered hours that is not normally scheduled to be performed within the same period. In other words, Rework is repetitive corrective (repair) work done on previously maintained equipment in a short time. It is also referred to as Callbacks.

a.       It is total hours of rework divided by total maintenance hours in any given period.

b.       Example: If there are a total of 900 maintenance hours logged in a month and 50 of the hours are spent on rework. The % rework for that month is 5.5%

·       50 / 900 = 5.5%

Work order labor capture includes all maintenance labor hours captured against a work order versus assigned to a cost center or other allocation. 

a.       The best method is to compare total payroll hours against total work hours.

b.       Example: Divide the total number of labor hours captured on a work order by the total payroll hours recorded for mechanic/technicians   4200 Labor hours from work orders / 6900 Total payroll hours for mechanics = 60.8% of man-hours captured on a work order

 

 

 

Wrench Time is the total time a technician spends diagnosing, adjusting, repairing, or servicing an asset. It measures productivity by comparing value-added to non-value added work. 

It is most often determined by a Work Sampling Study or Day in Life Of (DILO)

a.       Wrench Time is the total time a technician spends diagnosing, adjusting, repairing, or servicing an asset (value-added). It does NOT include time spent traveling to and from the job, training, in meetings, breaks, paperwork, travel to parts room,, cleaning work area, etc. (non-value added but needed).

b.       Wrench time divided by total man hours equals percent of wrench time

c.       Example: 820 hours of value-added time / 2000 total man-hours = 41% wrench time

Maintenance training hours are the number of hours maintenance personnel spent in training (classroom, seminars, workshops, in-house classes). This does not include safety and compliance regulatory training.

Note:  For purposes of this metric all employees primarily employed by the Equipment Maintenance Department or operation shall be included in this metric. 

This includes training that develops them in their role or will benefit them in future roles

a.       Divide the total number of training hours by the number of shop employee/mechanics

b.       Example: 180 Training hours / 6 Shop mechanics/technicians = 30 hours per mechanic/technician

Labor factor is the ratio of maintenance labor hours charged to an asset as compared to asset’s hours for the same period.

a.       Repair & Maintenance Hours/Equipment Hours Worked 

b.       Divide R&M hours / Eq. hours = Labor factor

c.       Example: 1500 R&M hours / 9000 Eq. hours

d.       = 16.67% labor factor or 1:17

Emergency work hours are defined as maintenance that is needed when an asset experiences an unexpected malfunction or change in condition that can cause considerable threat to health, safety and environment or significant production delays. The problem must be addressed as soon as possible (usually within 24-48 hours) hence the “emergency”. This metric can be a lagging indicator of the results of Metrics 15 Total Preventive and Predictive Maintenance (PM/PdM) as Percent of Maintenance Hours & 16 PM and Predictive Maintenance (PM/PdM) as Percent of Work Orders).  Not enough time invested in PM/PdM and PM/PdM will most likely lead to high emergency work hours.

 

a.    The metric is calculated by dividing the total number of hours shown on emergency work orders by the total number of maintenance hours performed.

b.    Example: If a shop had 4200 hours of total maintenance man-hours and 280 were classified as Emergency or Priority 1, the rate would be: 

c.     280/4200 = 6.6%

MTBF or Mean Time Between Failure (MTBF) is a Reliability metric that measures the effectiveness of the maintenance enterprise in reducing undesirable, unplanned and unexpected on shift breakdowns to the absolute minimum.

An absolute parallel can be drawn with safety where the effectiveness of a safety program is measured in terms of its ability to reduce undesirable safety incidents to the absolute minimum.

Parallels with safety mean that reliability is often measured as:

a.       MBTF is the average or mean time between system breakdowns. 

b.       MTBF is defined by the number of hours reported or metered during a period divided by number of breakdowns. 

c.       MTBF = Total uptime hours divided by number of genuine breakdowns.

Example: A mechanical mixer operates for 10 hours per day and breaks down after normally operating for 5 days. The MTBF for this case is 50 uptime hours as calculated below. 

= (10 hours per day * 5 days) / 1 breakdown = 50 hours MTBF

Similar to MTBF, Down Events Per 1,000 Hours is a metric that measures the effectiveness of the maintenance enterprise in reducing undesirable, unplanned and unexpected on shift breakdowns to the absolute minimum. It is a similar calculation to MTBF, using many of the same inputs, but is stated as a down incident rate vs. the hours between failures. It is measured as follows:

a.       Down Events are unplanned or unexpected events that impact production that either did or did not occur and this fact can easily and reliably be recorded in a work order or time card coding system.

b.       Equipment Hours Worked are the numbers of hours worked by machines for a given period of time

c.       The metric can be calculated at a unit, rate class or fleet level.

d.       When calculated at a unit level, the metric is usually calculated over the life to date of the machine.

 

Example: 

                                             i.            Down events = 3

                                           ii.            Equipment Hours Worked = 1,527

                                         iii.            Down events per 1,000 hours worked = (3 x 1000) / 1,527 = 3,000 /1,527 = 1.96 Down Events per 1,000 Hours Worked

This metric is used to measure efficiency in situations where parts and consumables are kept in inventory for later use in repair and maintenance activities.

It is calculated as follows:

Inventory turns = Value or cost of parts and consumables taken from inventory in a given period. / Average value or cost of inventory held over the period.

 

1.      The metric is often expressed in “days” by dividing 365 days by the calculated number of inventories turns in the year.

2.      Example: If the total Disbursements for 2020 were $388,925, and the total Average Inventory Value was $511,800, the turn rate would be .8

388,925/511,800 = .8

Many published authors warn against the use of this metric in isolation because it does not include any ability to measure the impact of stock outs from too high a value and, significantly, does not include any way of determining how much “dead stock” is included in inventory.

 

Service Level is the percentage of attempts for stocked items that are fulfilled without delay. They are measured by parts’ pick tickets attempted. Service Level is the opposite of Stockout. Stockouts are parts that are supposed to be in the storeroom but are not. For instance, if your inventory managementsystem shows you are supposed to have a part on the shelf, but you can’t find it, that’s a stockout.

a.       Service Level (Fulfillment Rate) = Total number of stocked parts correctly delivered first pass / Total number of stocked items requested

b.       Example:  125 parts fulfilled first pass during month / 132 parts requested during month

c.       125 / 132 = 95%