The Role Of AI In Preventive Maintenance

ZenFire

The Role Of AI In Preventive Maintenance

Private Equity
October 23, 2024

What if you could predict when your equipment will fail before it starts showing visible signs or malfunctions?

Or, what if you could replace a broken or damaged part of your equipment before it stops working and interrupts the comfort?

Running a successful trade business can be challenging. Imagine you are handling A to Z of the entire business – from repairs to installations. However, your devices and equipment break down unexpectedly without prior signs, regardless of the number of preventive maintenance services you have conducted on your systems. Nonetheless, the entire procedure can get very frustrating and time-consuming.

This is where artificial intelligence (AI) comes into play. It is undoubtedly transforming the landscape of preventive maintenance for tools and equipment.

This can be the next big trend for investors and PE companies looking for investment opportunities in the field service market or boosting their value creation for their field service portfolio companies. Investing in a business that understands the role of AI in preventive maintenance can not only boost adequate efficiency but also open doors for increased profitability. In this blog, we will try to understand how AI is a game-changer in preventive maintenance and the benefits it brings to the table. We will also cover why investors should pay attention to these businesses if their goal is to optimize their companies and boost their value creation.

Preventive Maintenance - What Is It?

Before diving into the topic, let’s first understand preventive maintenance.

Field service companies have two types of maintenance approaches: reactive maintenance and scheduled maintenance.

Reactive maintenance is when they provide repair services after the tool or equipment has broken down. Scheduled maintenance, on the other hand, refers to periodic maintenance checkups to ensure that the device is working properly and running smoothly.

Even though scheduled maintenance is a step ahead of reactive maintenance, as it provides servicing before the system breaks down. But it still is not the perfect solution. There can be instances where you are either over-servicing your system, which is working fine, or still facing issues with system unpredictability even after scheduled maintenance.

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AI-Enabled Predictive Maintenance - The Game Changer

When powered by AI, predictive maintenance is a smarter and more proactive approach to ensuring your systems are working properly and showing clear signs of malfunctioning much before the time arrives.

With AI-enabled preventive maintenance, businesses can easily monitor tools and equipment continuously. It allows you to predict potential problems based on available real-time data.

This is how field service businesses can stay one step ahead and address issues promptly—before they cause costly downtime or emergency repairs.

Role Of AI In Transforming Preventive Maintenance

AI is already changing the way field service businesses work and is gradually transforming the way they approach maintenance services.

As opposed to traditional methods of reacting to problems or sticking to a fixed schedule for maintenance services, using AI to predict forthcoming issues is gradually becoming the new and smarter way of approaching these issues.

With its pattern detection and real-time data, AI provides predictive suggestions that can help understand the tool’s or equipment’s status and condition. It’s like having an automatic machine telling you your system will break down before the disaster strikes.

But the question is - how does AI do it?

Data Collection & Analysis

The first and foremost step that AI takes is to collect adequate data on the tool or equipment. These objects or systems have sensors embedded in them, which allows easy data collection on factors such as temperature, vibration, energy usage, and similar factors. When the AI system collects this, it analyzes the data, looks for patterns, and detects when something doesn’t match up, signifying it doesn’t work.

This means, for instance, that rather than waiting for an air conditioning system to fail in the middle of the hottest season, a technician can be promptly scheduled to replace or repair the part that is about to stop working.

Predictive Analytics

Once the first step is done, which is collecting enough data for a thorough analysis, the real magic of the AI begins. Its only criterion is not to find out what’s wrong and where the issue is. It utilizes its data to provide predictions on when something can or will go wrong. By thoroughly analyzing the equipment’s historical data and current condition, AI can easily forecast potential malfunctions or system failures — which could be days or months in advance.

Let’s assume a field service business utilizes vehicles for easy and quick transport. The AI stores datasets of each vehicle, which tracks its temperature, oil levels, tire pressure, etc. For instance, if a particular vehicle starts consuming oil faster than the rest or compared to the normal rate, it can easily predict that the vehicle might need servicing before it stops working during service hours.

Automated Decision Making

The role of AI doesn’t just stop at predictions. It keeps this data to identify patterns that can help in further decision-making. AI can help businesses make smarter, better, and faster decisions regarding automated maintenance scheduling.

Based on the data available, it can automatically predict the next best component of the system or the entire equipment for a checkup due to rising potential issues. It recommends the perfect time for a service checkup by analyzing data such as usage statistics, wear and tear, and the tool’s overall performance.

But how is this useful?

This can help avoid unnecessary servicing for items that are not facing issues. It ensures servicing is done on the right equipment and at the right time, saving time and money in the long run.

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Benefits Of AI Preventive Maintenance

Either way, AI has made significant developments in the field of service management. Further ahead, FSM companies will gain significant advantages from utilizing AI-based predictive maintenance strategies.

Some key benefits of AI preventive maintenance for FSM businesses are:

1. Reduction In Downtime

Downtime is basically when one of your units stops working and causes loss due to a loss in production time.

So, when we say that AI can help significantly reduce downtime, that’s a great benefit we are looking at. As AI can help predict potential issues much before time, there are chances for you where you can repair or get your system corrected during regular maintenance sessions. This can help you avoid unwanted and unscheduled downtime, incurring loss of time and, most importantly, money.

This factor is particularly important for fields like HVAC or manufacturing, where every second or minute of downtime can negatively affect your business.

2. Significant Cost Savings

Now, this is quite self-explanatory. As AI is helping prevent unexpected breakdowns of your tools and systems, it is evident that you will be spending much less money on its repairs and maintenance than you would have been while fixing them in the last moments.

Emergency repairs can be typically more expensive than maintenance repairs. And when crucial components or parts are replaced at the last minute, you often pay a premium for the service.

Hence, AI-driven preventive maintenance helps minimize the need for unnecessary and repetitive maintenance visits, saving time and money and boosting business efficiency.

For investors, it’s crucial to focus on it as it helps reduce extra costs and enhances value creation in their portfolio companies. If a PE firm invests in AI-enabled preventive maintenance for all its field service portfolio companies, it can ensure a significant reduction in emergency repair costs.

3. Extended Equipment Lifespan

With preventive maintenance, you are indirectly contributing to increasing your equipment’s lifespan. When your tools and systems are in top-notch condition, and AI is effectively reducing wear and tear, you can be assured that your tools and equipment will last longer without creating more trouble in the long run.

This means that investors or PE firms investing in businesses adopting AI-based preventive maintenance are in a profit zone as it signifies lesser capital expenditures over time, resulting in more growth and revenue.

4. Improvement In Customer Satisfaction

For field service businesses that wish to remain in the market longer and make a name for themselves (almost all of them!), special emphasis should be given to providing world-class customer service and enhancing customer satisfaction.

In today’s time, the customer is king. And customers expect their equipment to be fully functional. If it doesn’t, it naturally means that they now expect a faster service.

AI has made it increasingly easy and effortless for businesses, especially in the field service industry, to stay ahead of such potential malfunctions and issues. It ensures minimal disruptions for customers, which means an increased sense of satisfaction. Having happy customers for your business is advantageous since repeat business and referrals via word of mouth are great ways to boost your business and garner a credible and customer-friendly reputation for your business.

What’s In It For Investors?

For private equity investors, the main criterion is to increase the operational efficiency and value of their portfolio companies and sell them at a higher price. So, if they can significantly decrease operational and maintenance costs, it can help contribute to their goals. Using AI for preventive maintenance can strategically give them an advantage and help increase business value.

Some ways investors can extract benefits from AI-enabled preventive maintenance:

Scalability

AI is helping field service businesses operate more efficiently with predictive analysis and maintenance triggers, which in turn makes it easy for the business to scale. Reducing downtime, improving resource allocation and utilization, and extending the lifespan of equipment — these are some of the ways the company can handle more customers without increasing its overhead charges. This is undoubtedly super appealing to PE firms and investors who are looking to grow their portfolio companies in a short period.

2. Higher Margins

Now, since AI is taking care of preventive maintenance, the profit margins of these businesses have significantly increased. When the need and demand for emergency repair services decrease, and the longevity of tools and equipment is enhanced, businesses can operate with lower expenses. This leaves more room for earning more money and making space for higher profit margins.

3. Data-Driven Insights

AI doesn’t just improve these businesses’ operations. It also contributes to effective and smarter decision-making with its valuable insights and data. Thus, it can help PE firms make smarter investment decisions regarding implementing strategies to increase their portfolio companies’ efficiency and value creation. By analyzing the data from equipment and tools and assessing the insights derived from it — such as performance, usage trends and statistics, and maintenance costs —it has become easy for investors to identify areas of improvement and enable strategic moves for growth potential.

The Future Of Preventive Maintenance Is AI

It is evident that the field service industry is evolving at a rapid rate, and AI stands at the forefront of it.

For business owners, adopting digital transformation with AI and automating their preventive maintenance is not just about standing at par with its competitors — its about staying ahead of all trends that can make them a better option for customers and investors.

And for investors and PE firms, its a great opportunity to identify businesses that adopts transformation and embraces AI integrations to help them increase value creation for their portfolio companies — contributing to higher margins, long term profitability and success.

AI is undoubtedly making preventive maintenance smarter and more efficient, which is in turn making them cost-effective. Reducing downtime, cutting down on unnecessary expenses, and improving customer satisfaction — these are some areas that AI is contributing significantly towards optimizng business processes and strategies for growth and profitability.

Artificial intelligence is changing the way field service companies operate and is paving the way for new growth and revenue opportunities. So businesses open to making this change an imperative strategy for their business growth and development, can plan for a potential successful future ahead — staying at par with customer satisfaction and enjoying higher revenue.