Ten Pitfalls to Avoid When Selecting a CMMS/EAM

1. Ten Pitfalls to Avoid When Selecting a CMMS/EAM presented by: David Berger Western Management Consultants

2. About WMC and David Berger David Berger • Professional Engineer and MBA • Written more than 350 articles on strategy, operations/IT improvement, and organizational design • Extensive industry experience including 2 manufacturers, and an Executive with one of North America’s largest financial institutions • Worked as consultant with numerous clients from all industries in area of specialization – maintenance, asset management, CMMS/EAM Western Management Consultants (WMC) • 30+ years in the general management consulting business • Multiple offices across Canada

3. Introduction • How can you get more out of your operating assets? • CMMS/EAM software is key • Long history of poor research, selection, and implementation of the right CMMS/EAM solution • 10 of the more common mistakes to avoid when looking for a new or replacement CMMS/EAM • The mistakes are listed in no particular order • Recent survey by Plant Services magazine

4. User-Centered Design Mistake #1 – You are far too focused on the software’s “look and feel”. • “Intuitive User Interface” ranked #1 importance in PS survey • Significant progress by most vendors in this area in recent years • Configure look and feel with screen painters • Tailor menus, tabs, screens, etc. to focus on priority work • Navigation tools like “favorites”, cookie trail, screen history • Data entry and reporting aids like comprehensive filters/sorts, flexible form/report configurator • Most vendors have user groups, human factors expertise, and modern development tools that ensure proper user interface

5. Vendor Partnership Mistake #2 – You are purchasing software based on functional fit only. • “Ease of implementation” ranked #2 in PS survey • EAM vendor = partner through implementation and beyond • Key vendor support services include • assessment of organizational readiness and gap analysis • process design expertise • knowledge of industry best practices • assistance in establishing key performance indicators (KPIs) • facilitation of data analysis and decision-making • longer term upgrades, additional modules, add-ons • Examine financial health, track record and corporate culture

6. Real-time Knowledge Management Mistake #3 – You think your CMMS/EAM is just a static data and reporting system. • EAM = real-time monitoring & control system including: • notification feature (eg, escalate severe KPI variances) • alarming or alert management • sophisticated workflow engine • advanced planning functionality such as real-time monitoring and trend analysis for conditions, energy consumption, emission levels, regulatory compliance, etc • “Planning and scheduling” ranked #3 in importance in PS Survey • “Notification and workflow” ranked as second-worst in terms of how well their current CMMS/EAM package performs

7. Decision Support • “Maintenance optimization” & “Analysis tools” are ranked #4 & 5 in importance in PS Survey • Analysis capability is the differentiator, not reporting • Key decision support features to look for include: • configurable KPIs • dashboards and business intelligence • advanced analytics, maintenance optimization tools • comprehensive risk-management / compliance tools • advanced warranty-management functionality • Look into notification and workflow functionality Mistake #4 – You are hung up on the slicing and dicing of CMMS/EAM data.

8. Energy Efficiency & Environmental Control Mistake #5 – You believe “green” functionality is today’s “flavor of the month”. • U.S. companies invest > $100B per year in capital equipment & services; but spend > $400B per year on energy • “What current trends do you think will have the most impact on operations in U.S. manufacturing plants?” – Energy prices #1 • Clear competitive advantage for companies that can monitor and control energy costs • Key sustainability features to look for in a CMMS/EAM are • measure energy use at the asset level • compare carbon footprint of assets, products, product lines, etc. • incorporate maintenance practices and standards that ensure energy efficiency of assets are optimal • “Health, Safety & Environment” ranked #6 in importance in PS survey • “Comprehensive energy tracking” ranked #17 in importance, and worst in terms of how well packages perform

9. Flexibility Mistake #6 – You are focused solely on how the CMMS/EAM will satisfy your current needs. • CMMS/EAM requirements should cover 3+ years out • Consider requirements of departments other than maintenance, (operations, engineering, purchasing, finance, IT…) • Specs should ensure flexibility to make changes to the software as stakeholder needs change • Flexibility = configurability. Ranks #7 in importance. Includes: • quick and easy configuration to meet the specific needs of users • workflow engine to quickly redefine key maintenance process logic • configurable KPIs for easily changing priority measures for analysis and reporting

10. Enterprise Thinking Mistake #7 – You tend to focus on how the CMMS/EAM benefits your location, instead of what benefits the organization overall. • Select a CMMS/EAM package that can accommodate the needs of each plant, as well as the overall enterprise • Strategic asset management functionality satisfies needs of • all levels in your company, from corporate to the shop-floor, • along the entire asset life cycle (i.e., design, procurement, installation, maintenance, disposal), and • for any asset class (i.e., plant equipment, facilities, fleet, infrastructure or linear assets, and IT) • “multi-site” and “strategic asset management” ranked #20 and #16 in importance in PS Survey – shows local plant bias • Millions of dollars savings potential for multi-plant organizations

11. Best of Breed versus Single-Vendor Suite Mistake #8 – You think implementing a single vendor ERP/EAM solution translates into the most “fully integrated” solution. • Multiple best-of-breed solutions: too much software to support and integrate • Select a single, best-fit, enterprise-wide, best-of-breed CMMS/EAM that integrates well with corporate ERP suite, i.e., strong open systems • “Open systems” ranked #7 in importance & 3rd worst in current performance • May want access to information & processes outside CMMS/EAM, eg, • aligning maintenance and production schedules • integrating labor data entry for both asset history and payroll purposes • integrating with applications specific to mobile devices • handling chargebacks for third-party billing • accounting properly for large capital projects involving maintenance • Some best-of-breed CMMS/EAM packages are easier to integrate than suite solutions -- tend to be more open and flexible, and by necessity have always had to integrate with corporate and other systems

12. Total Cost of Ownership Mistake #9 – You think it is always better to own and control your hardware, software and support services. • “Payment cash flow flexibility” ranked last in PS survey • Consider payment & deployment options that are more cost-effective, improve cash flow, lower total cost of ownership (TCO) • “SaaS” or “Software as a Service”: provides flexibility to pay monthly per named user, incl. hosting, training, consulting and other start-up costs; • Be wary of long-term risks if vendor outsources to third-party • Consider web-architected solution with lower TCO, i.e., cost of • licenses, • implementation, • training, • upgrades, • ongoing maintenance and support and • hardware. • “Web-architected solution” ranked #19 of 21 in PS Survey

13. Benefits Realization Mistake #10 – You celebrate the day the CMMS/EAM system goes live. • When would you consider the CMMS/EAM system successfully implemented – after a successful go-live? • Success = benefits realized, not system installed • Success must be defined in terms of performance measures and targets; the CMMS/EAM tracks progress • “Benefits realization” is ranked only #8 of 21 in PS survey In my view, the most important criterion in selecting a CMMS/EAM vendor and its software solution is ability to facilitate achievement of target benefits • All other criteria must then align and support benefits realization • Your CMMS/EAM vendor is an important partner in ensuring success over the long term

14. Q&A and Contact Information David Berger Western Management Consultants Phone: 416.362.6863 ext 237 Email: david@wmc.on.ca To get more information about Infor EAM solutions: www.infor.com/eam 1.800.397.6413 infoEAM@infor.com