Report reveals hidden costs of downtime

Edited by the Engineeringtalk editorial team Jun 19, 2006

The productivity of UK manufacturing is being held back by the amount of time plant and machinery is out of operation - with profits and morale hit at the same time, according to a major new report.

The productivity of UK manufacturing is being held back by the amount of time plant and machinery is out of operation - with profits and morale hit at the same time, according to a major new report.

The study, "Downtime: the problems, attitudes and practices in the manufacturing industry" was commissioned by Idhammar Systems to determine the extent to which downtime is a problem for British industry, and therefore a critical strategic business issue, at a time when Government figures show subdued UK manufacturing output.

Idhammar Systems is a global provider of computerised systems specifically designed to improve manufacturing efficiency, and this latest research repeats a similar study, which was commissioned by the company ten years ago.

The study among production directors and maintenance managers from 200 manufacturing companies found that most agreed that downtime is a significant problem for their company when vital equipment is not fully functioning, due to repairs, breakdowns, corrective maintenance work or other operational reasons.

As many as 88% said that downtime nearly always meant lost production time, and more than one fifth of the companies believed that product quality was adversely affected.

41% also admitted it was outside acceptable levels.

Despite the recognition of the problem, more than half those interviewed.

admitted that insufficient time had been spent on assessing the effect of downtime on profitability and 31% said that the issue was not discussed at board level.

In addition, the survey shows that nearly a quarter of UK manufacturing companies are not currently actively pursuing ways of reducing downtime and 30% have no budgets to support a drive to reduce downtime.

On the positive side, an encouraging sign was that 48% believe that downtime is decreasing in their organisation.

In addition companies today are more likely to record downtime, with 93% now recording periods when machinery or systems are down, compared with 78% in 1996.

Production directors and managers at manufacturing companies are also more likely to recognise the cost to their business of downtime today than ten years ago.

In 1996, 33% of respondents did not calculate downtime cost, but this latest survey shows that only 14% are not calculating the full cost of downtime.

Of those that do, however, lost production continues to be the most significant cost of downtime.

According to those interviewed rising downtime "cost outcomes" include loss of morale, cited by 18% of respondents compared with 2% in 1996 and profitability (53% compared with 44% in 1996).

The key factors seen to prevent downtime reduction were a shortage of skilled operators (43%), followed by unreliable equipment (39%) and insufficient planning of maintenance (33 %).

John Roberts, director of Idhammar Systems, has been advising UK industry for more than 20 years on ways of reducing downtime.

He said: "Whilst the findings reveal that awareness of downtime has improved since 1996, as has active management of the issue, there is still a long way to go".

"This survey shows that downtime reduction is critical to business' success.

And in the future managing downtime must be a board-level priority if UK manufacturing firms are to survive within a globally competitive market".