The True Cost Of Downtime report, available via www.is.gd/uvukuz, shares findings from a study of 72 major multinational industrial and manufacturing companies. It reveals that, on average, large plants lose 323 production hours a year. The average cost of lost revenue, financial penalties, idle staff time and restarting lines is $532,000 per hour, amounting to $172 million per plant annually.
Cumulatively, Fortune Global 500 (FG500) manufacturing and industrial firms are estimated to lose 3.3 million hours a year to unplanned downtime. The financial cost of this downtime to those organizations is calculated at $864 billion, the equivalent of 8% of their annual revenues.
Jim Davison, region director, South of England at Make UK, which represent manufacturers in the UK, comments: “One of the biggest challenges manufacturers face is reducing the amount of unplanned downtime and the figures in Senseye’s report clearly show the huge cost impact of not doing this. What is clear is that predictive maintenance can play a crucial role in not only reducing costs, but also boosting productivity at a time when manufacturers need to be using every tool at their disposal to meet the demands of an ever-changing industry.”
Senseye’s study also showed that more than two-thirds (72 percent) of large industrial organizations have made predictive maintenance a strategic objective and that one-in-five (20 percent) have established in-house predictive maintenance teams to lead these initiatives.
51 percent of organizations said they already performed some condition monitoring and 87 percent that they collected at least some of the data that can be used to support predictive maintenance.
Victor Voulgaropoulos, industry analyst at Verdantix, the independent tech research and advisory firm, comments: “Senseye’s investigation into the costs of unplanned downtime highlights just how much untapped opportunity there is right now for industrial organizations to save money through widespread adoption of software applications and technology-enabled maintenance practices.”