1.4/ Structure of maintenance costs

1/ Definition

1.4.1/ % Labor
1.4.2/ % Spare parts and materials
1.4.3/ % Major works (shutdowns/turnarounds/maintenance CAPEX)

2/ Objective / Target

The set of strategic indicators has three main objectives:
- Verification of the effectiveness of maintenance processes
- Comparisons between plants independently from the business
- Comparisons with external organizations

3/ Formula

Unit: %

Details of the formula: see "5/ SAP extraction and detailed calculation" 

4/ Frequency

Yearly

5/ SAP extraction and detailed calculation

Maintenance expenditures (with CAPEX)= 
Cost of outside contract services 
+ Cost of all Solvay maintenance employees 
+ Cost of non-stock MRO items
+ Cost of inventory MRO items 
+ Cost of on site contractors
+ Maintenance CAPEX

Cost of Outside Contract Services:

Expenses for maintenance work that is contracted due specialized skills or equipment needed.  
(Examples are water blasting, scaffold build/removal, forklift maintenance, HVAC maintenance, specialized millwright work, specialized inspection services, code vessel repair work, etc.)
Must be entered in the local currency. 

Cost of all Solvay maintenance employees:

Internal labor including all people supporting maintenance activities (managers, supervisors, planners, schedulers, storekeeper, administrative assistants, etc.).  
Employees who report to the maintenance organization but who are not directly involved in maintenance activities are not considered as maintenance employees (utilities operators, purchasing agents, etc.).
Must be entered in the local currency. 

Cost of Non-stock MRO items:

All spare parts, equipment and materials purchased directly from suppliers.
Must be entered in the local currency.

Cost of Inventory MRO items:

All spare parts, equipment and materials purchased through the stores system.
Must be entered in the local currency.

Cost of on-site Contractors:

Expenses for maintenance work that is contracted instead of using internal maintenance resources. This contract work is performed because of a contracting strategy or lack of internal resources.
Must be entered in the local currency.

Maintenance CAPEX:

Maintenance work that is capitalized due to accounting rules. This is typically, but not limited to, large cost work required to return equipment to its original state but extends the useful life.
Must be entered in the local currency.

Shutdown/turnaround work:

All costs associated with major shutdowns or annual turnarounds or major overhauls, whether or not accomplished during a plant shut-down. 
Must be entered in the local currency. 

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