Experience evidences that maintenance performed too infrequently leads to loss, resulting in unplanned down-time. Indeed, the cost of unexpected failure and repair can be up to six times that of planned preventative maintenance.

Costs saved by delaying routine servicing are short-term savings that are likely, eventually, to incur financial loss as the following case study highlights:

Having lost business and revenue, the maintenance department at a terminal was told to cut its budget by 20%. This helped cost management, but, rather than being a temporary measure, the cost reduction was continued for over six months.

Due to planned maintenance jobs being deferred and repetitive tasks and inspection frequencies being extended, the number of equipment breakdowns increased dramatically. This severely reduced ship loading rates and more business was lost. This became a vicious circle - increasing breakdowns reduced the operational availability of equipment, which further restricted access to other equipment for repair and maintenance.

In the end, the only way to bring the equipment back to acceptable availability levels was to engage numerous contractors and additional staff for nearly a year to address the maintenance backlog. The actual maintenance budget for that year was 200% above the norm.

With the added impact of lost business, the total cost to the terminal was enormous. This could all have been avoided if senior management had a better understanding of the need and importance of maintenance.