Where and how should your asset management solution be integrated?

Maintenance management systems should not stand alone.

By Sheila Kennedy, Contributing Editor

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A number of information systems support the maintenance of physical assets, but they are not always well connected. Typically, enterprise asset management (EAM) or computerized maintenance management system (CMMS) software will operate alongside any number of independent point solutions, which may or may not be integrated. Less often, they will be one component of a fully integrated, multifaceted enterprise suite.

The best approach depends on a company’s particular situation. Linear assets like pipeline and rail have very different needs than manufacturing processes that are fully automated or highly assembly driven. “A simple best-of-breed system with batch integrations might be the most cost-effective solution for one company, but another may need a fully integrated package, including maintenance, supply chain, projects, financials, engineering, and human resources,” says David Berger, principal at Western Management Consultants (WMC).

One thing is for certain: an EAM/CMMS should not operate in isolation.

Why integrate?

Siloed information is the most prominent risk when there are disparate, disconnected systems, although interfacing is not always the best answer. “The downside to integrating software applications is that it is very expensive and you have to keep it up over time,” says Berger.

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On the other hand, integration improves data visibility so that better decisions can be made, and it reduces operational risks. “It’s all about being more efficient and having all of your data in one place, in a single version of the truth,” suggests Patrick Zirnhelt, vice president of enterprise service and asset management at IFS North America.

The biggest drivers for EAM/CMMS integration, whether it’s within an enterprise application or across multiple solutions, are regulatory pressure, financial/competitive pressure, and health and safety considerations. Very public and expensive incidents, such as a mine’s chemical-filled tailing pond breaching into nearby rivers or a very old pipeline springing a leak, highlight the need for integration.

“Regulatory agencies are telling companies that they need to provide accurate and timely information on their activities, their incidents, and their assets,” says Zirnhelt. “For some companies, the required information is on paper somewhere, so it could take days to pull it together. With a properly integrated asset management system, you’ll have all of the information at your fingertips relatively quickly.”

Cost pressures are forcing organizations to be smarter, fueling the thirst for information and analytics. “When you have a complete picture of the costs of operation and maintenance, then you are better equipped to increase your margins or profits,” remarks Zirnhelt. “Reporting consistency also improves business decisions. If two plants report the same equipment need differently, one might get approval when another does not, even if their need is the same or more urgent.”

Rather than simple reporting, organizations want usable information from multiple systems and better compatibility between those systems, explains Berger. “For instance, if a mining operation is able to assess its maintenance dollars spent per tons produced, then it can easily see whether increasing production improves maintenance cost efficiency,” he says.

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From a health and safety perspective, tracking equipment and incidents and making sure you have proper corrective action procedures in place are facilitated by integration.

A plethora of maintenance-related solutions

The systems that impact asset management can be large or small, computerized or paper-based, and widely used or tightly held. “When information technology (IT) personnel do an application audit, they’re almost always surprised at the sheer quantity of applications in use,” says Ralph Rio, research director at ARC Advisory Group. “It’s amazing how point solutions added over decades live on because they solved some problem at a particular time, when they could easily be replaced by something that is more modern and integrated.”

A variety of common EAM/CMMS touch points exist.

Enterprise resource planning (ERP) and financials: “The biggest divide causing information silos is when the EAM/CMMS is separate from the ERP application,” says IFS’s Zirnhelt. “One power generation company has multiple plant sites across North America, each with its own EAM/CMMS system. Some of the sites do integrations and occasionally push data to the ERP financial backbone, but many of them operate in complete silos, without visibility between systems.”

Without integration of EAM and cost accounting, the financial analysts without maintenance expertise will have to do spreadsheet jockeying to pull the data from the EAM/CMMS into the financial system, explains Rio. “This manual approach creates errors and is labor-intensive at the end of the month when a lot of other high priority activities are required,” he says.

Automating the process of moving costs ensures consistency and accuracy, and it frees up the financial analysts to focus on other month-end activities. “Integrating financials between EAM/CMMS and ERP systems works beautifully,” says Rio. “If you have costs that you want to have capitalized at the end of the project, or if you want to allocate the costs of maintenance to a particular cost center, it’s a relatively simple integration that usually involves an end-of-month file transfer. Exceptions are few; there may be a need to reassign a cost center, but you’d have to deal with that manually anyway.”

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