What is Deferred Maintenance?

Keeping facilities in good shape costs a lot of money. There’s usually not enough money set aside to cover all the needed maintenance and repairs each year. When maintenance tasks are delayed to account for these budget constraints, it’s called “deferred maintenance.”

Deferred maintenance doesn’t mean the tasks aren’t necessary; it just means they’re being postponed. Sadly, delaying maintenance usually leads to even higher costs later on. Studies in the industry show that deferred maintenance costs increase by 7% each year.

People who often defer maintenance include:

• Cities and local governments managing assets
• Private companies handling inspections or maintenance
• Real estate companies or individuals overseeing maintenance for their buildings and properties

Wherever it happens, deferred maintenance creates a growing list of tasks that need attention. Presently, the United States faces approximately $1 trillion in deferred maintenance requirements within its infrastructure alone.

Your organization might not quite reach those numbers, but it’s important to prevent deferred maintenance from becoming a costly business practice. Let’s start by understanding deferred maintenance and exploring how it affects your facilities.

What is Deferred Maintenance?

Deferred maintenance, often called a maintenance backlog, happens when repairs are put off to a later date due to limited resources. These are tasks that need to be done eventually to prevent safety issues, breakdowns, or damage. Imagine it as a checklist for your facilities, with tasks staying on the list until they are completed. These tasks are scheduled when resources are available or until they become critical due to safety concerns or a high risk of breakdown.

It’s crucial to know, track, and plan for deferred maintenance to keep facilities safe and operational. While some delayed maintenance is okay for most organizations, if the list gets too long, tasks can be overlooked, increasing the risk to the organization.

What Are the Causes of Deferred Maintenance?

Companies might put off maintenance for a few reasons. Some of the main ones include:

• Cost Concerns: Sometimes, the company might not have enough money set aside for the work, especially if it wasn’t planned. This is often the main reason maintenance gets postponed. But what’s often overlooked is the additional costs that come from delaying maintenance, not just the immediate cost of doing the work.
• Accessibility Issues: Depending on where the asset is located, it might be hard to reach or unsafe to access for maintenance work.
• Company Policies: The company might have policies that prioritize minimal maintenance or waiting until something breaks before fixing it. This can mean assets are left to run until they fail, and then only reactive maintenance is carried out.
• Not a Top Priority: The asset might not be seen as important compared to other things that need fixing. The company might think it’s okay if it breaks.
• Hold Orders: Someone might have purposely delayed working on the asset for a specific reason.
• Not Enough Data: Maintenance managers might not have enough information or data to convince decision-makers that fixing things is important.
• Short on Staff: Fixing certain things might need specialized skills that the team doesn’t have, or there might not be enough people to do the repairs in the first place.
• Can’t Get Parts: Sometimes, the parts needed to fix something aren’t available.

What Are the Risks Associated With Deferred Maintenance?

Higher Repair Costs

If you delay fixing something, the cost of repairing it later may go up. For example, if you wait a few years to repair a machine, the price for the parts needed might increase because of inflation. The best time to get the lowest cost for fixing equipment is usually the present.

Lower Equipment Efficiency

When equipment isn’t working well, production can suffer a lot. This means more delays in delivering products on time and lower quality as workers struggle to keep up with orders. Also, poorly maintained equipment might use more energy, which costs more money and harms the environment.

System Breakdown

When an asset isn’t repaired promptly, it might stop working altogether, causing process delays. In addition, if an important, keystone asset fails, it can cause issues for the entire production process.

Safety Concerns

Keeping the workplace safe and ensuring good product quality depends on all assets working well. Delaying maintenance might even make safety risks higher in some situations.

Inadequate Regulatory Compliance

When a workplace doesn’t comply with regulations, it’s not just about the money spent on fixing things. More importantly, if a workplace is not following regulations, it can compromise worker safety and put people’s health at stake. Even outside of a moralistic standpoint, shirking compliance responsibilities leads to hefty costs – think about how fines from organizations like OSHA cost manufacturing companies over $6 million in 2019.

What to do if maintenance is deferred?

If maintenance has to be delayed, it’s important to make a plan to decide what needs fixing first. Putting off maintenance can end up costing a lot more in the long run if (or when) problems get worse.

Avoiding unnecessary risks is also important when delaying maintenance projects. If waiting to fix something makes it more dangerous for customers or employees, it shouldn’t be put off and added to a maintenance backlog. On the contrary, it should be addressed right away.

Deferred Maintenance Examples

City and Local Government Delayed Maintenance Examples

1. Roads: When cities delay repaving, fixing potholes, or repairing bridges, it can damage vehicles and create safety risks.
2. Public Transportation Systems: Not investing enough in public transportation infrastructure, like rail lines, stations, or bus stops, and neglecting fleet upgrades, can cause problems.
3. Parks and Recreational Areas: If parks aren’t maintained well, they can become unhealthy and attract pests, posing risks to public health.
4. Storm Drains and Sewers: If inspections are less frequent, they can cause blockages, leading to water backups during flooding times.
5. Buildings: Older government buildings often suffer from deferred maintenance. Avoiding necessary repairs now often means more expensive fixes later on.

Deferred Maintenance in Real Estate

Deferred maintenance in real estate refers to postponing necessary repairs and upkeep of buildings and properties. This can include:

1. Paint: When paint starts peeling, fading, or getting damaged by water.
2. Siding: Damage to siding caused by age, weather, or rot.
3. Roofs: Issues like missing shingles, leaks, or damage due to aging.
4. Foundations: Cracks, termite damage, or wear in the building’s foundation and supporting structure.
5. Windows: Damage such as cracks, leaks, or poor sealing.

Property owners often delay maintenance to avoid spending money upfront. Sometimes, delays happen due to slow permit approvals, forcing owners to wait until they can get the necessary permissions for repairs.

How to Decrease Deferred Maintenance

Step 1: Keep Track of Your Maintenance Tasks

You can’t solve problems you don’t know about.

By recording maintenance activities, even those you’ve postponed, you begin to gather information about which assets are well-maintained and which ones need attention.

Important data to track includes:

• List of assets
• Equipment details
• Warranty information
• Number of work requests per asset
• Work orders
• Time taken to complete tasks

Remember, in the past organizations like the NPS used this kind of data to secure funds for addressing deferred maintenance. While you may not receive billions, tracking data will certainly strengthen your case for funding to tackle deferred maintenance.

Step 2: Conduct an Inspection

Once you’ve started tracking data, perform an inspection to understand your maintenance needs fully.

During the inspection, gather details such as:

• Expiring warranties
• Recent equipment failures and potential future failures
• Safety issues related to poorly maintained assets
• Decreases in productivity due to maintenance issues

Step 3: Set Priorities

Now that you have data and inspection results, decide which tasks to tackle first with your available resources.

This step involves prioritizing maintenance tasks, starting with those needing immediate attention and working backwards. Consider assets critical for safety as top priorities.

Factors to consider when prioritizing maintenance work include:

• Time required
• Cost, including potential upgrades
• Asset location
• Age of the asset and its lifecycle
• Personnel to perform the work

Step 4: Create a Maintenance Plan.

Steps 3 and 4 often happen together, as you prioritize tasks while developing your overall maintenance plan. To create the plan, outline scheduled maintenance activities for each asset over its expected lifespan.

Include data from Steps 1 and 2, as well as:

• Asset and equipment locations
• Documentation and manuals
• Receipts

Your plan should address deferred maintenance to tackle the backlog and preventive maintenance to avoid adding to the backlog. It should also incorporate inspection and maintenance schedules.

Step 5: Put Your Plan into Action.

With a plan in place, it’s time to start working on maintenance tasks.

Continuously record data and make progress on deferred maintenance to strengthen your case for additional funding in the future budget cycle.

Clear Out Your Maintenance Backlog with NEXGEN

When maintenance tasks start piling up, it can lead to problems in terms of money, time, and resources. With NEXGEN CMMS, you can simplify and automate your maintenance processes, reducing the number of tasks that get postponed. Digital work orders make it easy to plan, track, and complete maintenance work. Additionally, NEXGEN keeps a record of past maintenance, helping you decide which tasks to prioritize and which ones can be deferred.