Posted on 06/14/2016
This blog was originally posted on 06/29/2015.
Not all facility repairs and capital upgrades can be completed immediately. Further, with budget constraints, you may be forced to put off spending money on a repair, even if you know it should be taken care of. You hope it can get by for another week, another quarter, another year.
Depending of the system, where it is located, and the use of the building it is in, the strategy may be to run to failure – and that is fine for systems that aren’t mission critical or where the failure doesn’t impact other parts of the building. But what about deferring maintenance on systems where there could be a broader impact?
This is where the value of the deferred maintenance can be much higher than just the identified repair. Let’s take a roof for example. Say you’ve identified a repair that needs to be made, but decide to wait due to budget pressure. A few months go by, and then all of sudden the roof starts leaking. It’s in a place that isn’t readily noticed, and a few more months go by. One day, one of your maintenance men notices that the floor is wet in a part of the building. Investigation shows that the roof has been leaking for some time, right where the repairs should have been done.
Now, as the team starts to look at fixing the roof, they find all sorts of surprises. First, there is an emergency repair to fix the roof. While in the attic, you find there is some damage to the sub-roofing and the insulation needs to be replaced, as well. Downstairs from where the leak occurred, the walls are soft and the ceiling is stained, meaning both must be replaced. Opening the wall shows further damage, and even the beginning of mold! By deferring the repair of a section of the roof, the cost has skyrocketed 10 to 20 times (or more) than what the original cost would have been!
Another example comes from a customer situation that could have been a disaster if it hadn’t been caught before any serious consequences occurred. A bank was renovating one of its key buildings and had some fairly old equipment, including long-past useful electrical transformers. But the transformers appeared to be working well, so they were ignored while other repairs were completed, including a renovation of the bathroom.
Using the Capital Budget and Ranking Module in VFA.facility®, an exercise was completed to rank all the capital needs in the building, including the consequence of failure, and further including those completed in the past year. They identified that the transformers should have been at the top of the list, rather than being deferred. The replacement of the transformers weren’t cheap – it cost several hundred thousand dollars, but what no one had taken into account when deferring this maintenance was that the building contained the main trading floor for the bank. The failure of one transformer would have shut down the trading floor. If that had happened, the cost would not just be replacing the transformer, but also the millions of dollars for every minute the trading floor was down.
Using a tool that prioritizes capital repairs and replacements can help you identify the risks associated with deferring maintenance and avoiding significant penalties for not completing maintenance and repair tasks on time.