The Repair versus Replace Debate: How to Transition to a Just-in-Time Replacement Strategy

At the end of the year, most of us are doing a lot of looking back and planning ahead. One thing every multisite operator should do is look back on equipment performance and plan ahead for equipment repairs and replacement. One move we see many of our customers making – and now is a great time to do it – is to just-in-time replacement of equipment rather than the traditional run-to-fail approach that defers purchases for as long as possible and tries to wring the maximum life out of old equipment.


Just-in-time replacement accounts for the total cost of ownership to get a true picture of life cycle costs, including the costs of equipment, installation and energy, plus short-and long-term maintenance. This prevents owning and operating equipment during the most expensive part of its life cycle. And it allows you to confidently identify and plan equipment replacement that delivers the best return on investment.


Here are five steps to transition to a just-in-time equipment replacement strategy:

1.) Gather the data. An effective just-in-time equipment replacement strategy requires good data. New technologies make it easier and more cost effective to collect data using advanced asset and energy management systems – starting with identifying exactly what equipment you have and what condition it is in and then identifying what it is actually costing to operate the equipment. Energy management systems, computerized maintenance management systems, mobile data collection tools and Internet-connected sensors help collect this critical information.


2.) Analyze the data. Cloud-based tools allow you to collect, analyze and report on different enterprise-wide data sets to enable effective capital planning. If you are managing multiple sites and various equipment, investment in a technology tool to help keep it all on track can easily be validated through the repair and energy savings you will quickly see realized.


3.) Identify all equipment beyond its useful life that could fail any day.


4.) Develop the systems and support to begin a planned equipment replacement strategy using total cost of ownership. This includes a system that can compare the cost of replacement with the cost of continuing to operate the equipment. There are asset management systems available that provide that kind of capability.


5.) Replace the oldest, least-efficient equipment first. Schedule replacements to coincide with off-peak periods with plenty of time to get equipment and installation bids.


The financial and operational benefits of improved asset management include reduced equipment operating costs, better employee productivity with fewer emergency situations, and a better customer experience. The good news is that today you can access technology to collect the needed data, and then use enterprise software tools to translate that data into a Total Cost of Ownership analysis. So it’s that much easier to transition to a more cost-effective just-in-time equipment replacement strategy.

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