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Q&A: Why Implement Enterprise Asset Management?

As manufacturers roll out an increasing amount of “siloed” enterprise-level software solutions, such as ERP and CRM, the role of connecting all these critical systems is becoming increasingly important. Fortunately, many companies have been developing and helping manufacturers develop solutions for enterprise asset management (EAM), which not only aid with the day-to-day operations of a given asset, but also connect to other systems to keep everyone on the same page. In order to get more information about the current landscape of EAM software, as well as what the group intends to accomplish on the plant floor, we got in touch with Kevin Price, Senior Product Manager at Infor

Manufacturing.net: Can you give us some background into the history of EAM and its purpose within a manufacturing operation? 

Kevin Price: Enterprise asset management, as a solution, is designed to protect and prolong the assets in an organization. It’s been around in many shapes and forms for years — our particular line of code has been around since 1986. When you see an organization, no matter what verticals they’re in, they’ll have assets that need to be maintained. Those assets are sometimes critical to an organization. In a manufacturing organization, you have the different cells of the manufacturing process, different types of heavy pieces of equipment. In the public sector — environment and utilities — you have pumps that push massive amounts of water … and that need to be running when they’re supposed to and in the most productive way they can.

With EAM, we provide software to do just that — to make sure those assets are running in the most efficient way they can. To make sure the people and the materials that need to be in place to make that happen, are working in concert with each other, to make sure the assets are working the way they’re supposed to. And ultimately, when the asset reaches a point where it needs to be retired or replaced, then you have a system in place to be able to make that capital planning decision and replace those assets. That’s EAM’s need and function.

Within Infor, we serve as that leg of the stool in the overall solution set. Instead of having a financial system that does well in isolation, wouldn’t it be nice if those systems already talked to each other? If they shared financial information whenever a requisition flowed from one to the other, when an invoice flows from one to the other? Whatever suppliers are putting together, they’re shared and pooled. That’s what we do.

Manufacturing.net: As you stated, Infor’s version of EAM has been around for quite some time. How have the needs of manufacturers, and in turn your offering, changed over the years?

Kevin Price: With manufacturers, one of the main things people try to change is overall equipment effectiveness (OEE). One of the big things in a manufacturing process is being able to make sure things are running. If it’s not running, it’s not manufacturing. You need to make sure that equipment is running, but that it’s also producing the highest quality you can. Second, the equipment is running, but it’s also calibrated correctly. If it’s not, it’s going produce poor product. The third thing is not only that it’s running, and not only in a high-quality fashion, but it’s also running in the most efficient way possible. It means that the resources needed to run that piece of equipment produce the highest results.

What people are constantly trying to do is keep the asset running, so that there is no downtime, while making it produce as much as it should, and at the least possible cost. OEE is one of those index ratings that people try to chase all the time, and it’s one of the things that can be provided in EAM systems. That way, you know how to maintain the asset, when to take it down and when it to take it down, or what kind of preventative maintenance procedures to do. In the asset management world, there’s several methodologies to doing preventative maintenance work. There’s a reactive method, meaning when the asset breaks, you fix it. You can continue to drive your car as much as you can, and when it blows up, you get another one. That’s reactive. Preventive is more proactive. Every six months, you do some type of action. Another is predictive, which is where you do analysis — take the oil out of the transmission and you look for metal filings. And if there’s a lot of metal filings in there, it means the gears are running together, which means the transmission stops going. You can actually predict when the asset is going to fail.

We take these methodologies and apply them to the manufacturing model in a variety of ways. OEE happens to be one. Another metric manufacturers chase after is the mean time between failures. They want to know how long it will take before that asset is going to fail. They’re trying to predict when that is going to fail, so they can take a preemptive measure. The worst thing that can happen in the process, especially a processing environment rather than discrete manufacturing, is when equipment fails. When it’s down, the whole production line needs to be shut down.

There’s other types of initiatives that are based on quality, such as reliability through maintenance, Six Sigma, Lean or Total Productive Maintenance. There’s a ton of different initiatives. These are modules that we put into our product where we can ultimately get to the point where either we have connections to the actual pieces of equipment to tell if it’s going to break, or to predict when something is going to happen.

Manufacturing.net: What kinds of successes have your customers had by implementing EAM? What about ROI in various mobile offerings? 

Kevin Price: For mobile, the rule of thumb is that I should be able to give maintenance technicians back 45 minutes of bench time a day, at a minimum. When you have a mobile solution in your hand, you should be able to book your material to that work order as you do the job. You shouldn’t have to write down on a piece of paper, take it back to the maintenance room, open up the computer, type it all in, or give it to a clerk who may or may not get it in on time. If I can give you a tool where you’re booking your time, and booking your materials, you’re putting your notes in or taking pictures as you’re doing your job, I’m making you more productive. I’m giving you back time. You take that 45 minutes, round that to an hour, and the number starts to add up. That’s an example of our ROI model.

If you look at asset management, in and of itself, you can look at the inventory problem. There’s shrinkage that goes on in inventory — so, how do you control that better? There’s stock-out that are related to inventory — how do you make it more available? If you go back to the downtime dilemma, the No. 1 thing you can always go to is the downtime event related to improper maintenance or unavailable maintenance. There’s ROI there. There’s a lot of points of ROI around asset management systems, because it’s so easily identifiable in manufacturing.

The worst — and most costly — thing we can do in most scenarios, is react to a catastrophic event. If we can do something proactively, we can save money.