Enterprise asset management on an international scale

Sept. 11, 2014
Integrated software packages manage global assets.

Enterprise asset management (EAM) consists of asset management, work order management, and inventory and procurement management of asset management and work order management parts, in an integrated software package. That is, it provides whole life management of an organization's physical assets, from the design, construction, commissioning, operations, and maintenance of a plant, equipment and facilities to the decommissioning or replacement of the plant, equipment, and facilities. One important feature of the software is that it can cover multiple sites from a central database. It is particularly effective in helping organizations shift from a run-to-failure model to whole life planning, lifecycle costing, and planned maintenance.

One benefit of EAM software is that it allows organizations to improve utilization (higher asset productivity), improve performance, reduce capital costs, reduce asset-related operating costs (including maintenance costs), extend asset life, improve the overall visibility of asset performance, and improve overall return on assets. Another benefit is that it is able to retain knowledge that is often lost when current experienced technicians and maintenance staff retire and are replaced by less experienced people.

EAM in action

JBT AeroTech in Orlando, Florida, manufactures and services airport equipment and products, including jetway bridges, tow tractors, ground power units, de-icers, and other ground support equipment.

"We started out as FMC Technologies, which spun off part of the company to create JBT Corporation," says Stephen Tatton, manager, technology and IT for JBT AeroTech. "We then got involved in what we call the Great Experiment to start a maintenance organization. We already built ground support equipment for airlines and airports. We also did some airport engineering work and controls work. So, we decided to start up a maintenance subdivision, JBT Aerotech."

JBT Aerotech currently has 26 fixed-based operations that it takes care of. Most of the locations are in the continental United States, but it has others in Guam and Jamaica. "We also work with a handful of other sites that we go out and remotely do," says Tatton.

As a way to ensure service to customers by offering improved efficiency, the company wanted to find a way to track all of the maintenance work that was being performed and identify the time that was necessary to complete each task. It also wanted to automate the workflow of work orders and procurement documents.

"When we started the maintenance organization, we realized that we needed to find a software to support our needs," says Tatton. "Five to 10 years ago, the one failure of all asset management systems was that none of them had great reporting capabilities. They were great for tracking work, and you could get data out of them, but it was really cumbersome. These days, we manage from data, and the data we enter into the system helps us make better decisions, helps us keep equipment running, and reduces our cost, so we needed software with business intelligence reporting."

Once JBT AeroTech selected its software, it rolled it out to a couple of sites, and then expanded it gradually to all 26 locations. "Some of the training was handled face-to-face or via computer lab," says Tatton. "We also do some WebEx training, as well as a lot of online video training."

The major key to success was establishing the key performance indicators (KPIs) upfront, says Tatton. "You need to define upfront what you need to monitor to run your operations," he says. "Do not underestimate the amount of time that it will take to do this right. Then, build a solid base, and everything else can be stacked on top of this."

It’s important to revisit your KPIs every six months to see if they are still the indicators that you want to keep, if some of them need to be modified, or if there is a new one that needs to be put into place says Tatton. "This helps you to keep current on the growing issues," he says.

EAM has been an unqualified success for JBT AeroTech. "At almost every one of our sites, the uptime of all of our equipment is 99.7%," says Tatton. "We also measure response time to get to a call, since every piece of equipment affects operations one way or another. If it is a baggage system call, our response time is less than one minute. If it is a passenger boarding bridge or some other call, it is less than three minutes."

In the future, as a way to improve service even more, the company is planning to focus more attention on repeat calls. "Once we identify these, we are going to send someone out to conduct a root cause analysis," says Tatton.

Global proliferation

According to a July 2014 report published by MarketsandMarkets, a global market research and consulting firm, the EAM market will grow from $2.48 billion in 2013 to $4.23 billion by 2019.

The report, titled, "Enterprise Asset Management Market by Software Applications (Linear Assets, Non-Linear Assets, Field Service Management, Assets MRO) By Services (Implementation, Managed Services, Training & Support) — Worldwide Forecasts and Analysis (2014-2019)," notes that North America is expected to be the largest market in terms of market size, while Europe and Middle East and Africa (MEA) are expected to experience an increase in market traction during the forecasted period.

The report also notes that some of the benefits that enterprise asset management solutions offer to organizations include higher asset productivity, reduced maintenance costs, and increased visibility of the operations and asset performance. In industries that operate in intrinsically hazardous environments such as oil and gas, metal and mining, organizations have to rely on effective asset management systems that will help augment the value of assets.

"EAM apps are definitely growing and acquiring a lot more flexibility, and there is a lot more data," says Shon Isenhour,  partner with Eruditio. "The days of running a stand-alone CMMS are long gone. These days, with EAM, we can know the health of all of our assets from a global standpoint."

Many of the large multinational companies are utilizing EAM, explains Isenhour, who’s done work in more than 20 countries. "They aren't all necessarily running in the same database or having complete visibility to each other, but they are running EAM at an enterprise level, not just at individual sites," he says. The more reactive plants tend to be those that operate EAM just at their individual plant sites. However, the plants that are being run extremely efficiently are typically running EAM systems such that the plants are networked with each other. "In fact, the best-run plants are those that are using an EAM system that is connected globally and using a corporate standard to do that," he says.

Why is EAM gaining such popularity on a global scale? "In recent years, EAM solutions have evolved to a large extent due to their growing functionalities, such as tracking and locating, using a geographic information system (GIS) along with energy management and compliance management," says Devesh Pal, a senior research analyst with MarketsandMarkets, and author of the EAM market report. "With significant growth in communication technology, EAM is now accessible from mobile devices." In addition, EAM solutions are designed to offer mobility along with flexibility in the work environment to gain control from almost anywhere. EAM is designed to maximize return on assets (ROA) for manufacturing and similarly for industries with high-value equipment. "In general, EAM reduces risks and costs, which in turn support better decision-making for asset management," says Pal.

EAM is also effective in complying with required regulations, irrespective of industry type. With the implementation of EAM, management can expect more responsive assets with improved efficiency. "EAM solutions these days are capable of handling complex activities from maintenance scheduling to risk management," says Pal. "The compatibility with major platforms and the provision of multi-tasking from a single interface makes EAM a major necessity for organizations."

There are some additional reasons for global growth of EAM. For one, enterprises are now migrating toward using integrated solutions for EAM and ERP, whereas small and medium-sized businesses across the globe with cost restraints will continue to use stand-alone EAM solutions. "In addition, the introduction of big data analytics in EAM solutions is expected to drive this market, as it is a huge opportunity for companies to leverage data to manage their assets more efficiently, in order to drive profits up and costs down," says Pal. And, in asset-intensive industries such as oil and gas, utilities, manufacturing, and transportation, downtime can be very expensive. "EAM will continue to play a major role in managing huge and complex assets in such industries," he says. These industries are expected to have a continuous effect on the demand side of the EAM software, along with the services market.

Global assets

One reason EAM is gaining significant traction in companies with sites in multiple countries is that, in the phase of global expansion, assets are located all around the world, and companies now look for EAM solutions to be able to share information across borders, says Pal. "Companies now need to link 'parent and child' assets so as to accurately track and measure relationships between assets," he says. In addition, ROA, resource utilization, timely maintenance, and lower operation costs are some of the benefits that EAM offers. "If this can be executed at a centralized location, then this can help companies save on hardware, IT support, and other costs, considering the economies of scale," he says.

Still, there are challenges for companies rolling out EAM on a global scale. "For one, government policies vary in different countries," says Pal. "It is a challenge to ensure compliance with local policies, while expanding globally." Second, management of assets located in different countries makes the analysis quite complex. "It becomes difficult to analyze every aspect of all possible scenarios to make the right decisions," he says. Finally, using a centralized EAM system to manage the assets at multiple sites is not always feasible. "Types and sizes of the facilities, plants, and other assets may make it difficult to have them managed centrally," he says. One way to overcome some of these challenges is to use EAM solutions along with other business process solutions, such as enterprise resource planning, supply chain management, and financial management, explains Pal. These can help companies acquire a better analysis of the different aspects of EAM.

One of the biggest challenges to implementing EAM globally is the language barrier, says Isenhour. "For example, you not only have to decide what you are going to put in the individual fields of the EAM, but you also have to decide what those fields are going to be called as it relates to nomenclature for each of the different areas for entering data," he says.

It’s not a good idea to roll out EAM to all plants at once, says Isenhour. "It is too overwhelming, unless you have unlimited resources in terms of staff to be able to handle the implementations," he says. "Even then, it may not be a good idea. Most companies are engaging in staged rollouts, which involve conducting pilots in a couple of plants first, get the bugs worked out, and then carry that model across the globe."

Show, don’t tell, when it comes to training, recommends Isenhour. "Application is very important to successful training," he says. "Have them actually do it as part of EAM training." Second, don't just offer generic training to everyone. Take the time to understand the business processes that are in place, what the steps are that people need to complete, and then make sure you are training them specifically on what they need to know.

Finally, the main key to success is to make sure you take the time to do all of the upfront work. "For example, make sure you identify the hierarchy and criticality for all of the assets you are going to load," says Isenhour. "Make sure you create a corporate standard for nomenclature, so that all of the sites can actually speak the same language and thus be able to connect with each other. If you fail to do this upfront work, it will cost you a lot more money in the long run."

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