The rocky state of our economy is forcing a change in values that many thought would never resurface in our consumption-based society. After several years of runaway spending by consumers and companies alike, it’s hard to go anywhere these days without being confronted with the message that Americans must save, conserve and reel in their wasteful ways. From personal financial affairs to corporate America’s bottom line, everyone is looking for a better way to pare down.
To calm feelings of trepidation as we move from being a nation of spendthrifts to plain old thrifts, take comfort in the notion that control over your plant’s financial domain is in your hands. Clamping down on a plant’s assets and energy usage is entirely up to how well your maintenance department utilizes the company’s investment in CMMS/EAM software.
Given the recent turn of events, it’s not just maintenance professionals or CEOs who are taking notice of the CMMS’s ability to help ratchet down costs and squeeze the most out of facilities. Even venture capitalists are getting into the game.
Earlier this year, Triton Pacific Capital Partners, a private equity firm that says it invests in small and mid-size companies with strong growth prospects, acquired AssetPoint, a Greenville, S.C.-based CMMS/EAM provider that is a spin-off from Fluor Corp. It’s the third CMMS software company that Triton has acquired, and Fred Thiel, managing partner at the firm, says each of the company’s asset-management-related acquisitions has an established market niche and “high-value growth opportunities.”
Thiel says Triton was looking to acquire a company in the maintenance management space and, at the same time, AssetPoint’s former owners were looking to transition ownership to a group that could take the company to the next level. Five months later, Triton took the reins.
“From Triton’s perspective, CMMS/EAM is a specialty area where there still exists independent, best-of-breed solutions and where the large ERP players still don’t have good enough solutions for the demanding requirements of enterprises outside of traditional manufacturing,” Thiel says. “AssetPoint is clearly a best-of-breed provider with a strong SaaS [Software as a Service] offering and a broad cross-section of industry leaders represented in its customer base.” He says the firm’s goal is to work with AssetPoint’s management to grow the company into the leading standalone CMMS/EAM vendor.
David Berger, P.Eng., Plant Services’ contributing editor and CMMS consultant, says CMMS vendors that serve small and mid-size plants’ needs are on the right track, because of this sector’s growth potential. “Many companies invested in their CMMS to get infrastructure in place for Y2K, but now they’re fine-tuning their systems and seeing the payback,” he says. “Companies have smartened up to realize that there’s potential there.”
As a result of this reciprocal relationship, CMMS companies themselves are experiencing increased interest, and Berger says venture capitalists are snapping them up. “It’s clearly a growth area,” he adds. “Plants are getting much more sophisticated. Companies are asking how much more money they can get out of their assets by managing them better.”
This trend reemphasizes, to industry insiders and outsiders, how important asset management is. Is it possible that the underappreciated maintenance field is being valued as the crucial profit source that managers have been trying to convince CEOs of for years? If these recent acquisitions are any indication, the answer is affirmative.
As for the CMMS vendors themselves, Berger says the biggest opportunities for them are in servicing small and medium-size companies, and branching out, if they haven’t already, in the international arena.
Houghton LeRoy, senior analyst of enterprise software for ARC Advisory Group, agrees. “I think it’s good for them [AssetPoint], and the infusion of more cash will help them to be able to do more. One area they need to pursue is international exposure because of globalization and the amount of opportunities offshore.”
With a fresh infusion of capital, it’s likely that is the direction AssetPoint will take. “Our goal is to work with AssetPoint’s management to grow the company into the leading stand-alone CMMS/EAM vendor,” Thiel says. “We are currently working on some important product enhancements that will be announced over the next few quarters. We will continue to expand both domestically and internationally through direct relationships and partnerships. We will invest more in our professional services group and their reliability offerings.”
And, with every such acquisition, the spotlight on the importance of asset management grows brighter.
E-mail Managing Editor Lisa Towers at [email protected].