How to Reduce MRO Costs

Medical devices are quite expensive on their own and maintenance costs are also relatively high. The medical equipment maintenance market is projected to hit $65 billion by 2030.
 
Maintenance, Repair, and Operations (MRO) is critical to maintaining the usability of medical devices. The health of such devices directly or indirectly affects the health of patients in a treatment facility. But a significant challenge in that respect is MRO costs.

MRO Cost Concern

All businesses have to be profitable to sustain their operations. The medical industry and hospitals are no different. High MRO costs affect the bottom line of the company. This affects business viability in the long-term.
 
With high MRO costs, you are also more likely to delay maintenance operations that are not absolutely necessary. This may not cause immediate problems. But will cause minor damage to machines and devices in the treatment facility each time maintenance is delayed. This compounds and could potentially lead to much larger faults and catastrophes.
 
Many such eventualities could arise due to high MRO costs. You should take every bit of effort to reduce MRO costs incurred by your organization or your clients.

MRO Cost Drivers

The first step you have to undertake to reduce MRO costs is understanding the factors that affect them. These may be different for each medical device and situation. The following sections cover some of the prominent factors that contribute to MRO costs.

Skilled Professionals

Medical devices are the result of complex engineering and medical innovations. Operating and maintaining such devices requires high knowledge and skill level. Finding skilled technicians for the job is quite difficult. Even if you find such a technician, you will have to pay top dollar to employ and retain such an employee who can operate or maintain medical devices. This is a significant factor adding to MRO costs for enterprises.

Specialized Parts

Since most medical devices are not mass produced, replacement parts and components are also not mass produced. This increases the cost of production of replacement parts. This gets reflected in high MRO costs when parts and components of medical devices need to be replaced.

Complex Tools

More often than not, medical devices are made with proprietary components and elements. Such devices will require specialized and complex tools to operate them. It is the same case for maintenance, too. Acquiring complex tools and skilled technicians who know how to use them is significantly expensive. This also contributes significantly to MRO costs.

Reactive Maintenance

Reactive maintenance is when medical devices have to be taken out of operation and maintained. Such unscheduled events cause multiple costs to the enterprise. This includes damage to equipment and/or people. Another cost is the opportunity cost when the machine is under maintenance. Reactive maintenance also requires more time, replacement parts, etc. All of this adds to MRO costs. Therefore, it is always best practice to avoid reactive maintenance.

Driving Down MRO Costs

As we have seen in the former sections, a host of factors contribute to rising MRO costs for medical device enterprises and their clients. Rising MRO costs eat into the profitability of hospitals and other medical facilities. Competitive forces in the market will force your competitors to offer medical devices that have significantly less MRO costs.
 
This means you have to take proactive measures to bring down MRO costs for your organization and also for your clients. Since we know the drivers contributing to MRO costs, we can understand ways to tackle and reduce such costs. Some of the measures and techniques that can be taken to reduce MRO costs are discussed in the following sections.

Maintenance Automation

The major challenge to performing adequate maintenance is behavioral. You have to find ways to work around the behavioral biases of maintenance technicians. The most powerful tool you can adopt is to automate all maintenance activities. When maintenance activities have to be performed algorithmically, there is no chance for interpretation and missing required maintenance activities. You should actively consider automating all your maintenance activities in addition to automating manufacturing and operations.

Preventive Maintenance

Reactive maintenance activities are incredibly costly. It is always best to avoid reactive maintenance by employing preventive maintenance. These are scheduled maintenance activities on medical devices that help to prevent faults. Performing timely preventive maintenance helps to sustain the life and health of medical devices. It also helps to avoid costs associated with reactive maintenance.

Software Solutions

Today, technology converges in all facets of our lives. MRO need not be treated differently. There are a plethora of tools that help you maintain and automate maintenance activities. Computerized maintenance management system (CMMS) is ideal for maintaining medical devices in your enterprise. If the CMMS you opt for is cloud-enabled, technicians can access details from any location and on any device. This gives a great deal of flexibility and openness into the MRO of your organization. CMMS is a tool to help you perform maintenance in an accurate and repeatable manner. The MRO costs saved by using a CMMS will more than justify the cost for the software. You should seek and employ all such software solutions to simplify your MRO and eventually reduce costs.

Predictive Maintenance

With today’s industry 4.0 paradigm, you are privy to a lot of data from the medical devices you oversee. You can put this immense amount of data to use. Machine learning algorithms can help you predict faults that might happen. This is possible by analyzing and modeling immense data available with machine learning algorithms. This is predictive maintenance. Performing predictive maintenance will eliminate reactive maintenance activities to a higher degree. This eventually reduces MRO costs.

Maintenance as a Service

All organizations do not have the size and scale to employ dedicated skilled maintenance staff. This gave rise to a business model commonly dubbed as maintenance as a service. Here, maintenance technicians and equipment are pooled for multiple organizations. They perform required maintenance without being on the payroll of each company, but will require a retainer fee. In some instances, OEMs provide such a service. There are also third-party services that provide maintenance as a service. Choosing such an option will significantly reduce MRO costs for individual organizations. You should be considering such an option if your organization is small enough that the cost for a dedicated maintenance team cannot be justified.

Technology Deflating MRO Costs

In the sections above, we discussed the various drivers of MRO costs. We also discussed various tools and techniques that can be employed to reduce MRO costs. Among the solutions to reduce MRO costs, technology plays a significant role. Automating maintenance and predictive maintenance are prime examples of using technology to reduce MRO costs.
 
Technology also can assist in executing other solutions such as preventive maintenance. This makes it essential to use a cloud-based software solution like CMMS to reduce MRO costs for medical devices and manufacturers.
 

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Bryan Christiansen is the founder and CEO of Limble CMMS. Limble is a modern, easy-to-use mobile CMMS software that takes the stress and chaos out of maintenance by helping managers organize, automate, and streamline their maintenance operations.