Measuring Maintenance Performance

If you cannot measure and account for performance you cannot improve it. This is where the losses start.

Overview

This service is based on studies into the financial and management performance measurements for maintenance and maintenance support. To some extent it is an advanced approach to life cycle cost.

The studies have shown that these two systems are not always aligned very well, and in some cases not at all. Maintenance and accounting people at all levels are often trying to solve the problem without fully understanding how the problem is generated and then how it evolves. There is a trend to want to use only financial measures of performance, and this may not be the most correct approach. With such a focus on measures such as EBIT, and the expenses involved that influence EBIT, it is necessary to see their influence from the point of generation to the point of measurement. A simple test is to look at the correlation between the performance parameter (tonnes per day)and the way it is measured at the accumulating level (e.g. EBIT). It may be that there is no or very low correlation. So, why spend resources collecting data that does not help you measure your performance?

Measuring Maintenance Performance Program Scope

We can deliver this program as either the analytical work, or as a comprehensive training course. In either case the scope of work is typically as follows. Note that this is an evolving program of work as the studies reveal the various paradoxes and paradigms.

Performance parameter analysis and selection
Understanding financial accounting
Understanding management accounting
Links and dysfunctions between financial and management accounting
Maintenance and maintenance support factors
Activity Based Costing and Management

For more information about this service, please contact me.