By failing to plan and schedule maintenance, over a period of time, maintenance departments have to face more number of breakdowns and higher downtime in their plants. Subsequently, in such cases, maintenance staff need to deal with a high percentage of workload in the form of reactive/breakdown maintenance which often proves costly.
Further the impact of breakdowns, occurring at random time, shows significant effect on costs in several ways. Whereas some of these costs can be perceived tangibly, the rest could only be realized in intangible terms, as discussed below:
(1) LOSS OF PROFIT DUE TO DOWNTIME:
Loss of Profit due to downtime on account of production loss, referred as indirect maintenance cost or downtime cost.
(2) COST OF SECONDARY FAILURES:
One small undetected failure may have a cascading effect leading to secondary failures.
(3) COST OF REDUCTION IN USEFUL LIFE:
Frequent breakdowns lead to forced deterioration and hence reduction in useful life of various parts.
(4) COST OF SET UP TIME:
In case of breakdowns, often it requires quite some time for fault finding and arranging necessary tools and spares.
(5) COST OF TEMPORARY WORK:
In the event of critical breakdowns, maintenance is pressurized to finish work fast and often it ends in doing a temporary work.
(6) COST OF STANDBY LABOUR:
In order to correct breakdowns speedily as they come up, it requires labour deployed round the clock. In the event of breakdowns labour is utilized productively, but when there is no breakdown, it simply keeps up as standby labour.
(7) COST OF EMERGENCY PURCHASES:
Certain parts required to correct breakdowns if not available in stores may warrant emergency purchases and could involve additional cost.
(8) COST OF INJURY DUE TO BREAKDOWNS:
Certain breakdowns may be hazardous and cause injury to the workers.
(9) COST OF OVERTIME:
Too many breakdowns may create backlog of work which could possibly be cleared at the cost of overtime only.
(10) COST OF REJECTION OR REPROCESSING:
Breakdowns may lead to rejection of products or necessitate reprocessing at additional cost.
(11) COST OF DELAYED DELIVERY OF GOODS:
Delivery schedules may get disturbed due to breakdowns leading to dissatisfaction amongst customers and result in loss of goodwill.