Key Performance Indicator Analysis
BEB Industrial Asset Management focuses on helping our client partners to understand and define key performance indicators (KPIs) that are meaningful, measurable, and actionable for their unique fleet operations. By pairing the historical cost and production information on your assets we are able to identify tactical and strategic options for your fleet that will assist in time savings, optimization of your fleet assets, and reduced material handling fleet costs.
We encourage our clients to evaluate their assets based on the total lifetime cost of ownership. This perspective on cost management considers expenses including the variable the factors of labor, maintenance, and fuel, in addition to fixed costs of purchase price and financing. Setting KPI goals designed to impact the controllable and significant portions of asset ownership yields the rapid achievement of ROI and fleet optimization.
Choosing the right KPIs for your organization is reliant upon having a good understanding of organizational objectives. Many of our clients find that the following KPI's have been beneficial in the lowering of costs and the right sizing fleets.
The first step in BEB's process with any client is to ensure that we have developed a firm basis of "current state" data on their fleet. Understanding the present situation will allow our clients, guided by our Account Managers, to develop realistic goals and plans for best practice improvements and cost reductions as we gather and analyze data on that same fleet in the future.
Cost Per Hour
This is a measurement that shows the cost that incorporates both how much it costs to operate a specific asset and how frequently that asset is utilized. Cost per hour evaluations help to identify assets that are inordinately expensive compared to similar assets in the fleet. This KPI puts all assets on an even playing field, thus allowing you to replace or redeploy equipment that exceeds the benchmarked targets.
Utilization is a key measure of fleet management that shows the actual amount of time that an asset is actively being used verses the available time that a unit could be used. For example, in a 2080 hour work year, a lift truck that is utilized 500 hours per year has a 24% utilization rate. This KPI allows our clients to determine assets that are being over or under used and to manage their entire fleet in a way that yields optimal utilization with the least amount of units and lowest total costs of ownership.
Cost Per Unit
Not all material handling or industrial assets can provide exact utilization or hour meter readings. This measure analyzes the total spend in a category (IE: manual pallet jacks) and equalizes that total to determine what each individual unit costs to own and maintain.
Mean Time Between Failure
This KPI looks at the average hours and days between non-scheduled repairs. Ideally, this measure should have a high number of days between failures. Downtime and unexpected repairs can cause major issues, thus eliminating expensive, problem assets can immediately help to control costs and stabilize operations.
Preventative Maintenance Compliance
PM Compliance is a metric that measures one aspect of service dealer performance: the ability to complete scheduled preventative maintenance events in a timely fashion. Equipment that does not receive proper PM checkups consistently have more unscheduled repairs, higher lifetime cost of ownership, and reduced resell value. Additionally, regular PM service is a condition of most manufacturers standard and extended warranties. By helping out clients to hold service vendors accountable for performing on-time PM service, we reduce costs, downtime, and many administrative headaches.