CMMS in Waste Management Part 2: Managing Regulations and Rising Costs
ManagerPlus is at Waste Expo in Atlanta this week (booth 4920), providing waste management companies with a hands-on look at our CMMS solutions and explaining how they can help cut costs and improve profit margins.
In a previous blog installment we highlighted three key areas where CMMS solutions can save waste management companies money: minimizing downtime, streamlining workflow, and providing the critical information necessary to make smart equipment lifecycle decisions. For part two, we will focus on two additional areas where our solutions can impact the bottom line: coping with regulations, and managing rising costs.
+ Turn regulations into a competitive advantage. In some cases, regulations have actually driven growth in the waste management industry—the UK/EU industry grew in value by over 22.3% between 2009 and 2013 despite seeing a steep decline in the volume of waste entering landfills over the same period. This is largely a result of expanded environmental regulations, which have prompted a shift toward increased recycling and other waste remediation methods that generate less carbon dioxide, but often entail higher costs than traditional landfill disposal.
The picture is similar in the U.S., where recycling now accounts for more than 34% of solid waste remediation, compared with just 10% in 1980. The amount of waste that ends up in landfills is just 54% (as of 2009) and dropping.
These trends pose both a challenge and an opportunity for waste management companies: there is plenty of room to grow, but companies must be capable of adapting their technology and operations to respond to the demand for greener waste remediation.
With ManagerPlus solutions, companies can generate detailed reports on their equipment, enabling them to accurately assess costs and determine which pieces of equipment should be sold and replaced with new technology. And once new equipment has been purchased, ManagerPlus can be used to schedule preventive maintenance to keep it working in top condition and maximize its useful life.
Companies that prove best at managing these technological transitions will put themselves in position to capture business from competitors who do not have the operational flexibility to evolve in changing conditions. In an industry where profit margins are particularly thin, having accurate, complete data is the best way to ensure that major changes are made with maximum efficiency.
+ Combat rising costs. According to the World Bank, the cost of waste remediation is expected to top $220 billion by 2025 for high income countries, an increase of 38% over 2010 levels. Technological demands, fuel costs, and a rapidly expanding global population will place major strains on existing waste remediation infrastructure and continue to drive the adoption of new technologies.
The best way for companies to cope with these pressures is to plan ahead and minimize costs wherever possible. Tracking labor, fuel/mileage and inventory in a CMMS system provides the operational insight necessary to determine where changes can be made.
For example, projected labor costs can be compared with actual rates by running a variance report, making it easier to hold workers accountable. Inventory tracking can help reduce carrying costs by determining if there are too many parts on hand, while also ensuring that critical parts never run out when they’re needed. Integration with fuel/mileage tracking meters provides accurate, up to date information that can be used to make cost cutting adjustments.
Wherever adjustments are ultimately made, the key is to make sure that they are driven by accurate data. Companies are often surprised by the inefficiencies they find when they implement a CMMS system to track their operations, as many are making the transition from paper or spreadsheet based systems that are error prone and not nearly as detailed.
There’s no question that the waste management industry will continue to undergo fundamental change in the coming years. What’s less certain is how different companies will react. Those companies who maximize control over their operations with CMMS solutions will be in the best position to expand their market share, while those who remain behind the curve on data will lag behind.