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Maintenance Costs as a % of ARV – Is It Useful? – CONNECT Conversations

Ron Moore | Contributing Host, RELIABILITY CONNECT

Maintenance Cost as a Percent of Asset Replacement Value is often used as a measure to determine the effectiveness of the maintenance function. But, is it? In this podcast we’ll discuss the various means of calculating its value, and by implication, some of its downsides, along with a range of its value for various operations and potential reasons for that variation.

Is it useful? Perhaps, but only if it’s used in a proper context, along with other measures to judge maintenance performance. We’ll consider:

· The nature and variation of benchmark data

· The inputs for calculating maintenance costs and asset replacement value, and their variation.

· Various influences on the measure and using it to judge performance, e.g., the current state of the assets, current operating and maintenance practices, its sustainability, the impact of market demand, among other factors

· Other measures to be used in conjunction with it to get an accurate view of performance.

· Our view of the most effective use of the measurement


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About the Author

Ron Moore Contributing Host, RELIABILITY CONNECT
  • Author of 1) Making Common Sense Common Practice; 2) What Tool? When? A Management Guide; 3) Where Do We Start Our Improvement Program?; 4) Business Fables & Foibles; 5) A Common Sense Approach to Defect Elimination; 6) Our Transplant Journey; and 70+ papers
  • Authority on strategies and practices for operational excellence
  • Clients in North & South America, Australia, Europe, Asia, Africa,
  • Managing Partner of The RM Group, Inc. for 27 years
  • Prior to consulting – President of Computational Systems, Inc. (CSI)