WHITE PAPER The resident maintenance model Five ways an outsourced maintenance program can provide the most efficient and cost-effective answer for your operational challenges automation that delivers
The resident maintenance model Five ways an outsourced maintenance program can provide the most efficient and cost-effective answer for your operational challenges By Corey Calla, director, lifecycle support team, Intelligrated Maximum uptime with minimal headaches Today s automated order fulfillment and distribution systems operate faster and longer to meet increased fulfillment volume at the speed of omnichannel demands. Typical operational requirements mandate sorting and shipping orders 18-20 hours a day, seven days a week. These prolonged hours of operation limit available time for maintenance teams to perform required repairs, preventive maintenance (PM), rebuilds and prevent benchmarking the relative health of a system. High-speed omnichannel fulfillment depends on complex equipment, controls, and software to get the job done. With trailers arriving for unloading and loading on tightly-monitored schedules, the intangible cost of downtime can quickly escalate, cutting into slim profit margins and jeopardizing future business and customer loyalty. However, preventing downtime and optimizing operational efficiency of these highlyautomated systems requires PM programs planned and executed by a skilled maintenance staff that is competent with the latest versions of software, systems and diagnostic techniques. With man power in high demand, fewer highly-qualified personnel are available in the labor pool. This increases the risk of losing key personnel and their legacy system knowledge due to employee turnover. More and more DC operators and e-retailers recognize the value of a resident maintenance program offering guaranteed uptime, guaranteed staffing and limitless access to original equipment manufacturer (OEM) engineers and support staff. While maintenance outsourcing is not a new concept, particularly during peak demand periods, replacing internal staff with onsite experts and a turnkey maintenance program is proving to be a costeffective model for today s high volume, high-speed distribution centers. 2 The resident maintenance model
In this white paper, we ll look at five benefits of implementing a resident maintenance program using real-life examples from the Intelligrated customer service and support (CSS) staff. These benefits include: 1. Solving maintenance staffing and training challenges 2. Controlling the cost of high-tech system and software maintenance 3. Integrating a computerized maintenance management system (CMMS) with enterprise resource planning (ERP) and warehouse control system (WCS) 4. Implementation of a robust PM program 5. Guaranteeing and achieving uptime 1: Make maintenance team recruitment, training and turnover a problem of the past Staffing shortages, particularly skilled mechanical, electrical and software maintenance technicians, continue to plague DC operators. A resident maintenance program provides an attractive alternative, deploying staff already trained in OEMequipment and resourced to start work on day one. Rather than spending time with internal HR staff to define and redefine the required skill sets for this month s maintenance recruitment effort, the resident maintenance service technicians deployed to the facility exactly match operational and maintenance requirements including any seasonal demand adjustments. Facility staff no longer bears the burden of initial training and subsequent training as equipment is added, upgraded or changed. In addition, resident maintenance programs eliminate the risk of losing legacy knowledge due to staff turnover the service provider institutionalizes this information among a broad base of system experts and databases. 3 The resident maintenance model
A typical automated DC is much more complex than systems implemented from a decade ago. There is a wider variety of equipment with more dependent interconnections of the WCS, WMS and real-time controllers, says Kieran Ryan, director of maintenance services, Intelligrated. Recruitment and training can be a real inconvenience considering all of the trade disciplines required for a robust preventive and emergency maintenance team. A resident maintenance program frees operations staff from worries about system uptime and extended system lifespan so they can focus on product flow and making the customer happy. 2: Control, predict and reduce the cost of maintaining high-tech systems High-throughput DCs employ increasingly complex hardware and software that demands new and specialized maintenance knowledge from technicians. Increased productivity brings a potential risk of higher associated maintenance costs. The more automation, the more maintenance required. We have seen older non-automated facilities running with 700-800 operational staff and perhaps 25 maintenance staff. Upgrading to an automated facility with higher throughput may only need 80 operational staff but require 50 maintenance technicians, says Ryan. Keeping a high-throughput automated system up and running with short maintenance windows can be a challenging exercise. Factoring in the staffing and sparing requirements to meet throughput KPIs adds an additional challenge and costs. With less time for maintenance, preventive tasks can get pushed aside for more urgent repairs, with a compounding impact on downtime and maintenance costs as the system ages. Furthermore, in the event of an equipment malfunction, spare parts must be onsite along with a fully-trained technician to complete the repair. A resident maintenance program meets these maintenance challenges and provides a predictable cost for guaranteed throughput. The program not only includes trained mechanical, electrical, controls, and software technicians but also spare parts stocked for fast repair, plus instant access to OEM resources and engineering assistance. Most DC operators would rather focus on meeting their business objectives of customer satisfaction than DC maintenance and staffing. Controlling expenses with guaranteed uptime is a great benefit for these companies, Ryan says. 4 The resident maintenance model
3: Gain the benefits of a fully integrated CMMS Keeping hundreds of assets maintained and operating at peak efficiency is a daunting task. By implementing a computerized maintenance management system (CMMS) every facility asset can be viewed and tracked on a graphical interface, ensuring efficient management throughout its lifecycle. CMMS implementation has benefits that range from system-wide maintenance planning and labor allocation down to individual machine-level monitoring to identify repetitive issues and cost of ownership. Maintenance scheduling, labor management, PM planning, work order generation, spare parts inventory and performance reports can all be aggregated within a CMMS. In addition, a CMMS integrates with the DCs ERP and WCS to share data and provide an unprecedented ability to manage assets and predict system wear and tear all while optimizing maintenance budgets and schedules. The CMMS also sends notifications via text, automated voicemail or email in the event of critical situations. The result? Reduced response time, less downtime and lower perceived maintenance costs. With a properly implemented CMMS, the DC operator gains a complete asset history from cradle to grave, including ancillary equipment such as lift trucks and batteries. says Rick Emery, CMMS system administrator, Intelligrated. This provides invaluable insight into the true cost and performance history of each asset, impacting how and when maintenance is performed and a potential upgrade or replacement is scheduled with attendant cost benefits to the operator. In addition, each asset is tracked individually so identical units that may have different motors are managed as separate assets. It s just a smarter way of working, with a real impact on increased uptime. 4: Make time for preventive maintenance programs Maximizing equipment life and preventing unplanned shutdowns are some of the primary drivers for a PM program. A PM program also ensures that recommended system enhancements and upgrades are implemented. Running a lean internal maintenance team frequently results in downsides such as minimal to no time allocated for preventive maintenance. Responding to unplanned outages takes all the resources available, with the consequence of expensive equipment not meeting life expectancy and a noticeable increase in unplanned outages. Running 18-20 hour days, seven days a week can also compromise a PM program. A resident maintenance program includes a robust and highly structured PM program designed for total lifecycle support. This type of PM program ensures maximum life of the capital equipment investment, as well as keeping uptime and throughput at optimum levels. 5 The resident maintenance model
While a PM program can be overlooked due to reactive maintenance requirements, it s really an insurance policy for long-term system performance, says Ryan. Ultimately, the lack of PM is going to impact cost in terms of lost throughput, increased downtime and shorter equipment life. We see costeffective PM as one of the greatest benefits of a resident maintenance program. 5: Decrease downtime with contracted uptime Your resident maintenance professional will be Time efficient Providing high quality maintenance during limited downtime A clean sweeper Keeping your systems clean and clear of debris A system inspector Inspecting and identifying worn parts and equipment to prevent failures before they happen, reducing unplanned downtime A reference point Providing greater access to company resources both remotely and in-person as an employee of the system s manufacturer Fully trained Comprehensive training in the company s specific solution, as well as industry standards and OSHA requirements. Throughput is one of the most important KPIs for any DC operator. The ability to meet throughput goals relies on sustaining uptime. A superior maintenance program contractually guarantees uptime of 97 percent or better. While actual uptime frequently exceeds this figure, the number alone is not the whole ROI story. With operational staff free from maintenance oversight, they can focus on strategic planning and management. Guaranteed uptime is a huge relief for DC operators, says Ryan. We reach and exceed these uptime figures due to our skilled technicians, our robust PM program and our ability to immediately respond to emergency outages and equipment failures by having the right technicians and spare parts in the right place at the right time. Familiar with asset management and legacy knowledgebase Maintaining complete system knowledge that never just gets up and leaves, like employees. The system manufacturer manages hiring, training, record keeping and reporting. 6 The resident maintenance model
WHITE PAPER Major home improvement retailer keeps DC equipment uptime high with a resident maintenance program A major home improvement chain faced increasing Results from peak season operation at 22 locations online orders coupled with growing demand at its running up to 95 hours per week tell the story: brick and mortar facilities. With more than 35,000 SKUs available at each store and more than three times that number available online, the company required continued high-level automation investment for both retail and online DCs to meet demand. As part of its automation strategy, the retailer contracted 0.48 percent of downtime due to maintenance issues, including label applicator and printer needs, mechanical adjustment, e-stop and photo eye adjustment 0.3 percent of downtime due to operational Intelligrated for a resident maintenance program issues, including jam clears, accumulation issues offering guaranteed uptime at a controlled cost and faults allowing the company to concentrate on serving customers, not maintaining highly-automated 40 percent of downtime due to loose product or product jams material handling systems. 7 The resident maintenance model
A calculated return Today s automated distribution centers face increased maintenance challenges due to increased dependence on software, high-tech control systems and generally reduced times for periodic maintenance tasks. Difficulty finding, training and retaining qualified maintenance technicians coupled with lack of time to support a PM program can result in unacceptable downtime, increased maintenance costs and early replacement of underutilized assets. A resident maintenance program solves these challenges and ensures that high-performance DCs and all associated equipment, from equipment to controls, operate at peak efficiency. Guaranteed uptime at a controlled cost can be an attractive proposition for DC operators struggling to meet throughput KPIs and overall investment ROI goals. Integration of a CMMS as part of the Intelligrated resident maintenance program provides an extensive management tool for more strategic decisions on maintenance activities and equipment performance. For DCs that struggle to meet uptime requirements or keep a fully-trained maintenance team on site, a cost-effective resident maintenance program can provide guaranteed uptime, minimal unplanned outages, increased overall system performance and longer life for capital equipment investments. Calculating the ROI Factoring in sales volume, number of employees, hours worked and wage structure, operations can easily calculate potential savings incurred by a contracted resident maintenance program. For example, a facility operating 4,500 hours a year with four percent downtime could reduce downtime by 56.25 hours with a resident maintenance uptime guarantee, saving more than $1.25 million annually. Subtract more than $500,000 of in-house maintenance costs and total program savings exceed $1.75 million. Ask your lifecycle support representative to estimate your downtime and discover what your company could be saving. Intelligrated is a full-service resident maintenance provider for automated material handling systems. Designed to meet DC systems maintenance challenges, an Intelligrated warrantied resident maintenance program provides a predictable cost for a guaranteed throughput. A resident maintenance program like Intelligrated s includes CMMS integration by trained personnel, a robust, highly-structured PM and asset management program designed for total life cycle support from cradle to grave and a contractually guaranteed uptime of 97 percent.* *97 percent uptime guarantee is a minimum standard. Current programs may exceed these expectations. 8 TRMWP01 04.14 Intelligrated. All rights reserved.