Did you know that unplanned downtime costs $125,000 per hour?

The recent ‘Value of Reliability’ survey by ABB reveals that over two-thirds of industrial companies encounter unscheduled outages at least monthly, costing an average business nearly $125,000 per hour. Yet, 21% of these businesses still depend on reactive maintenance strategies.

Conducted by Sapio Research in July 2023, the survey collected opinions from 3,215 maintenance decision-makers across various sectors, including energy generation, plastics and rubber, oil and gas, wind, chemicals, rail, utilities, marine, food and beverage, water and wastewater, and metals. The survey forms part of a comprehensive report that examines current maintenance practices and explores methods to reduce unexpected downtime.

The survey highlights the critical role of maintenance in enhancing equipment reliability. 92% of respondents noticed increased uptime over the past year due to maintenance, with 38% reporting improvements of at least 25%. Moreover, three-quarters acknowledged that reliability positively influences their company’s reputation and financial health, aiding in fulfilling contracts, minimising waste, and securing repeat business. When acquiring new equipment, reliability emerged as the primary consideration for respondents.

Looking ahead, 60% of respondents intend to increase their spending on reliability and maintenance in the coming three years, with one-third planning to augment their budget by over 10%. 90% showed interest in outcome-based maintenance contracts, where payments to service providers are tied to specific results like improved uptime or energy efficiency, ensuring efficient service and predictable expenses.

IOT Insider spoke with Virve Viitanen, Global Head of Customer Care and Support at ABB Motion to further discuss.

Reliability was rated by respondents as the top priority when purchasing new equipment. Why is that?

This may be due to businesses seeing reliability as something you purchase at the start of the lifecycle of the equipment, and not something that has to be maintained throughout the equipment’s lifetime. This was demonstrated by the significant proportion of businesses that still prioritise capital cost rather than the total cost of ownership. This suggests a tendency towards short-term thinking, where initial cost considerations overshadow the long-term benefits of reliability.

Motors and drives are put under a lot of strain. Many operate in particularly harsh environments and are required to run 24/7. The reliability of the equipment will decrease over time if it isn’t properly maintained – the rate at which it decreases will vary, but it is inevitable.

That’s why an effective maintenance strategy is so important. Digitally connecting equipment helps spot small problems before they become bigger issues. Businesses should also consider an outcome-based model if reliability is a priority.

Various reliability-centred services also exist – like reconditioning equipment back to its original factory quality and modernising it by installing new components that come with a host of modern features. Enefit Green, the largest wind energy producer in the Baltics, serves as a prime example. By opting to replace their wind turbine converters with reconditioned ones, they boosted reliability, extended the lifetime, and mitigated CO2 emissions.

Why do maintenance decision-makers still think the run-to-fail method is still viable?

It’s important that maintenance professionals don’t overlook the connection between reliability and uptime.  A reliable maintenance strategy means maximising uptime, reducing costs, gaining a competitive edge, and ensuring peace of mind.

However, sometimes the run-to-fail method is perceived as a viable balance of effort and cost, especially for less critical equipment. Though, we were surprised to see that 21% of businesses were relying on it as their main strategy – especially since 80% of businesses using this method experienced downtime at least once a month.

Positively, we also found that 66% of decision-makers are planning to increase their investment in reliability and maintenance in the next three years. This suggests that decision-makers are recognising the importance of investing in reliability but may need further education and awareness to help them fully comprehend the benefits that investing in reliability brings. Businesses could even go one step further and look into an outcome-based strategy – where a service partner is only paid when they achieve specific outcomes, such as a certain level of uptime. We found that 87% of decision-makers would be interested in an agreement like this, signalling a growing interest in more advanced maintenance methods.

Take Statkraft, for example, the biggest renewable energy generator in Europe. Its Lister Drive project in Liverpool, UK involved installing a 40-tonne flywheel to stabilise the local grid as the country integrates more renewable energy. Recognising the importance of avoiding any downtime, Statkraft entered into a 10-year outcome-based services contract with ABB. Ensuring high level of uptime involved a full maintenance strategy including planned and rapid response. It also required digitalised equipment so that the remote service team could proactively plan corrective actions ahead of time, ensuring the reliability of their local grid. 

How exactly can better maintenance practices help companies meet their emissions targets?

Better maintenance practices not only increase reliability but can also help avoid emissions, boost energy efficiency, and cut costs. After all, well-maintained equipment runs at its highest efficiency, so it consumes less power which in turn reduces CO2 emissions.

Let me give you an example. One Belgian sugar processing plant came to one of our trusted channel partners because it was facing critical production downtimes. So, it decided to monitor the condition and performance of its critical dryers and fans. After digitally connecting the equipment, they spotted a strange vibration in a fan motor. Rapid scheduled maintenance boosted the equipment’s uptime, but also increased efficiency by 12%. This led to annual savings of €4,000.

Also, by performing better maintenance businesses minimise wasted materials, reduce the need for replacement parts, and limit cleanups and restarting processes. This substantially cuts down on waste generation and accompanying emissions. For example, reconditioning a variable speed drive reinstates factory-level quality while also helping to avoid up to 80% CO2 emissions compared to buying new.

What role does ABB’s Smart Sensor play in reducing unplanned downtime?

Smart sensors play an important role in gathering data from motors. Data can also be captured via a variable speed drive (VSD). Digitalisation of the motor-driven system enables analysis of specific operational data, such as noise or vibration, and automatic alerts to any changes in normal operation. This condition monitoring means operators can plan maintenance activities based on the actual needs of the equipment, rather than relying solely on predetermined schedules. In this way, operators are given the data required to make better decisions to improve the equipment’s reliability, performance, and efficiency.

In this way, digitalisation facilitates a shift towards a more proactive maintenance strategy, where operators can predict equipment failures before they happen. This reduces unplanned downtime, extends the lifespan of assets, and boosts efficiency. In our survey, users of proactive, condition-based maintenance reported a 42% increase in their uptime from last year.

What challenges are the current skills gaps in the industry creating in the area of maintenance and what can be done to overcome these challenges? 

The current skills gap in the industry, aided by an ageing workforce, creates significant challenges for businesses. A substantial 43% of respondents expressed challenges in recruiting maintenance staff. In this survey, we found that the UK and Germany were the countries struggling the most, as well as the metals and water sectors.

To overcome these challenges, it is imperative to foster interest from the younger generation to join the manufacturing sector. Investing in digitalisation will help attract a younger workforce. Sectors perceived as more ‘cutting-edge’ struggle less with recruitment, we found that the wind sector, for example, struggled the least with recruitment.

As experienced technicians approach retirement, long-term outcome-based models can help mitigate the impact of the skills gap. These models enable businesses to plan and allocate their maintenance resources appropriately.

Ultimately, service partners are there to plug knowledge and labour gaps, provide rapid response support when needed, and help companies transition to better ways of monitoring critical assets. Whether it’s a need for rapid emergency response or a longer-term strategic partner, reliability services can be tailored to suit every sort of requirement and help companies combat skills shortages.