Improving Utilization of Heavy Machinery
The first step in improving anything is an accurate measurement or counting of the existing conditions. In some ways this is very similar to Land Improvement. If you want to change anything, it is critical to have benchmarks are existing measurements so that you can determine where to go and by how much.
Our studies of otherwise very well run businesses and governmental organizations many lack good tools to even give them basic information about the operation of assets that cost thousands or millions of dollars. The most common example of this we found is how many companies don’t know until the end of the year how machine hours they will use. You need to have forecast tools that will show you actionable data before the year is over and you cannot change the outcome!
Take this simple quiz to evaluate your organization:
How well do you know what is going on with your machines? Your Answer
1. Do you have electronic records of machine usage that can be
compiled into reports to help senior managers, project managers
and other decision makers?
2. Can you easily and accurately compute how many hours your
machines were idle for working hours over the last 12 months?
3. The largest single variable cost used to determine what a machine
cost a company is annual utilization hours. Do you know have
accurate machine meter reading information to support your belief
of how many hours each of your machines is actually used?
4. Do you get monthly or quarterly reports on the forecasted annual
use of your machines so can you know your cost of any machine or
group or machines has changed and needs re-costing?
5. Do you know exactly how much “Opportunity Loss” you
experienced last month (or year to date) due machines sitting unused?
6. Do you know what projects that have machines sitting and unused.
7. Do you have the information about groups of machines within your
fleet such as hydraulic excavators, to help you determine if you should
buy or sell?
8. Do you get weekly fuel and utilization reports on your machines that
contain actionable information?
9. Do have Job Cost information as to the actual cost of machines
based on UTILIZATION and machine hour meter readings? There is a
big difference between a machine operating cost and machine standby
cost on a job.
10. Do you know the three Key Performance Indicators of utilization
for your fleet:
- Total Fleet Machine Hours Used (Year to Date and Annual
- Percent (%) of Fleet Utilization
- “Opportunity Loss” experienced last month
(or year to date, and annual projection) due machines sitting
unused on projects
If you scored less then nine out of ten questions, we can help you to reduce your machinery cost due to underutilized machines. Call us today! Click here for free no obligation tour of these easy to use tools.
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