Total Asset Utilization

Total Asset Utilization (TAU) is based on the concept of Total Predictive Maintenance, but extended to include one additional factor. TAU is a measure of how effectively an asset is used to make salable product or service. However, since it in no way deals with profitability, it is sometimes a very bad thing for a business to maximize TAU. Imagine a product that runs very well on a piece of equipment but cannot be sold for a profit. To understand the true profitability including trade-offs, a CPR model needs to be employed.

TAU is the product of four ratios, two of them related to the usage of time, the other two with the effective use of the asset to make product. Note that TAU is just as useful in determining how effective service assets are in allowing a service to be performed.

TAU = Availability × Duty Cycle × Efficiency × Yield

Availability is the ratio of the time the asset is available to run to total time in the period examined.

Duty Cycle is the ratio between the time the asset was actually running and the time it was running plus the time it took to set up.

Efficiency is the actual versus the design rate of production for the asset. This is the most contentious calculation.

Yield is the proportion of the product or service output that was salable.

By multiplying these ratios together, we get a measure of how well we use time and the asset to generate the asset's output. By using the four components regressed against some measure of interest (perhaps number of units produced or customers serviced) we can generate a predictive equation that will tell us where to spend our resources to receive the largest return.