Preventive Maintenance: Who has the time and who needs it? - In tough budget environments, preventive maintenance is...

In tough budget environments, preventive maintenance is often the first activity to be postponed. Completing proactive work is overtaken by the immediate and urgent corrective or emergency maintenance work at hand.

By: School Dude

But, how does that impact the overall cost of maintenance or the overall cost of stewardship of the investment in the school or college facility?

We've all heard the old sayings:
• Pay me now or pay me [more] later.
• An ounce of prevention is worth a pound of cure.

When it comes to preventive maintenance, do we believe them to be true? How do you answer the question: Does preventive maintenance (PM) save money?

Who has the perspective to answer the question?
In serving a large population of school facilities directors across the US for many years, we have gathered a wealth of data about our users. From this unique perspective, we offer three ways to look at the answer to that question:
1. What does the PM data tell us?
2. What are some typical cost comparisons?
3. What are other industry benchmarks, like insurance claims?

1. The "PM Masters" Data Study of 2010
In 2010, our staff examined the user data of overall work orders and preventive maintenance work orders generated and performed in the calendar year of 2009 to identify schools with outstanding preventive maintenance programs, with a view to share their best practices.

Methodology:
• Conduct data analysis across 4,850 educational clients including a breakdown by segment (K-12, Higher Ed).
• Identify those "PM Masters" who are allocating the highest (top decile) amount of preventive maintenance resources compared to their peer group, and who have been doing so for some time. This typically means:
- More than 30% of maintenance resources allocated to PM work. We find this generally to be the top 10% of the peer group.
- High completion rates (generally > 98%)
- History of 3 years of data with strong PM
- Factor out variations due to campus or organization size by enrollment or square footage.

Conclusions:
The study revealed some significant trends:
• PM Masters performed less emergency work, saving both time and money. Those colleges or school districts with a strong PM program enjoy:
- A 50% - 65% reduction in the rate of emergency work
- The average cost of a work order being 28.6% to 39.3% less expensive.
• Preventive work reduces the amount of corrective work required. Over a 5-year period, a sampling of PM Masters garnered a 16% reduction in corrective maintenance work as a percent of the total work over the time period.

Over a 20-organization sample across the 5-year time span, the corrective work as a percent of the total work is reduced from approximately 87.28% to 71.29% of the total work performed.

2. Typical cost comparisons: the roof and the HVAC 
I need a new roof!
A school or university's roof is often the most neglected area of routine maintenance. Many roofs have a 20-year manufacturer warranty with strict caveats requiring routine maintenance. However, according to studies from roofing industry associations, many roofs see only a 12-year lifespan, due to common deferred maintenance practices. Industry research lists the replacement or repair of a roof among the 30 most costly maintenance and repair tasks over the typical 50-year life expectancy of your building. Conversely, a solid preventive maintenance program for roofing can generate an expected 30% extension of the life of that asset and delay major capital impacts from arriving too early.

What about HVAC?
If your HVAC unit is not properly maintained, you can expect it to cost 3-4 times more than the cost of preventive maintenance. Think about it: If you don't perform routine maintenance on your car, it will greatly increase the cost of ownership. Regular oil changes are a lot less expensive than a new engine. Maintaining an HVAC unit is no different.

In addition, the more an HVAC unit struggles with dirty filters or un-lubricated parts the more energy it takes to heat or cool an area, raising your already costly utility bill. Various studies also reveal a direct correlation between the quality of air and the efficiency of a campus to student performance and being able to attract and retain students.

What are the overall costs?
Not everyone can relate to cost/square foot, so let's look at some simple math in cost per student.

American School & University's 35th Annual Official Education Construction Report showed that a new school's construction cost could range between $18,000-23,000 per student ($150-170 per sq. ft.). For the purpose of this article, we will take an average of $20,000 for new construction cost.
• A roof is roughly 6% of the building's cost or $1200/student.
• HVAC systems are roughly 10% of the building's cost or $2000/student
• This totals out to $3200/student for both HVAC and roofing construction costs.

Now, let's say a typical roof and HVAC will last 15 years...we hope:
• This 15-year life divides into $3200 to yield $213/ student/year.
• If we perform PM to get an extra 2 years out of a roof and HVAC, we are essentially spending $188/student/year, which is a savings of $25/ student/year.
• If we are a 3000-student institution, we've saved $75,000 annually in capital impacts over the lifespan of roofing and HVAC.

How many jobs could this save? Or how many initiatives might have continued instead of being cut from the budget?

3. Let's look at insurance industry data
In a landmark study conducted by a major national insurance company, the company offered insight into the claims history of a very large percentage of schools and colleges in the United States. The study looked at de-identified data and the intersection of the following datasets:
• Approximately 19,000 school buildings for which there was insurance claims history.
• Approximately 12,000 client buildings, some of which benefited from a PM program.
• Of those, there was a sample size of around 9,000 schools where data existed.

Analysis of the data revealed the following conclusions:
• Those schools that had an effective PM program experienced a 70% reduction in claims.
• Of those claims experienced, the severity of the claim was approximately 10% less costly than those claims occurring in schools without a PM program.

Although the insurance study could not conclusively prove causality, is proprietary, and was not published, the facts speak for themselves.

So we have an answer, now what?
It's easy for groups to prioritize educational adequacy needs over facility needs, but here's the question to pose to your non-facility decision makers: "If you have no roof on your home, or your air conditioning system went down in the middle of a hot day, how much focus would you put on cooking dinner that night? Likewise, if this building fails, how can we provide a quality learning environment or expect students and staff to be happy while we fix the problem."

If your facilities services department is not getting what it needs, or is being reviewed for potential cuts, start promoting your department services and the needs required to maintain facilities and prevent costly repairs. You must "sell" and offer insight into your department's operational functions and requirements, but you must also closely tie those functions into the mission of your school or campus. Show how the school's mission will be affected by what is done or not done within the campus environment. Reducing the number of recycling pickups or the extent of grounds maintenance can be negotiable, keeping the essential building systems consistently and safely functioning on your properties should not be. Let's work hard as good stewards of the investment in our schools and campuses by answering the hard questions with quantitative data: Preventive maintenance pays off in the long run!

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