--- title: Predicting Equipment Failures to Improve Reliability description: Learn how equipment failure probability, predictive maintenance, and risk-based strategies help reduce downtime and improve asset reliability. image: https://blog.nexusglobal.com/hubfs/Featured%20Images/Articles/Article%20CTAs4.jpg --- [Skip to the main content.](https://blog.nexusglobal.com/predicting-equipment-failures#main-content) [![Nexus Logo PNG White](https://blog.nexusglobal.com/hs-fs/hubfs/Nexus%20Logo%20PNG%20White.png?width=1600&height=645&name=Nexus%20Logo%20PNG%20White.png "Nexus Logo PNG White")](https://www.nexusglobal.com) [![Nexus Logo PNG Black](https://blog.nexusglobal.com/hs-fs/hubfs/Nexus%20Logo%20PNG%20Black.png?width=1600&height=645&name=Nexus%20Logo%20PNG%20Black.png "Nexus Logo PNG Black")](https://www.nexusglobal.com) - [Software](https://www.nexusglobal.com/software) - Business Optimizer - Data Optimizer - Strategy Optimizer - Planning Optimizer - Investigation Optimizer - Software Integrations - 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By analyzing failure rates, equipment condition, and probability of failure, organizations can identify risks, optimize preventive maintenance, and reduce unplanned downtime. In Part 2 of this series, we explore how failure data supports more effective maintenance strategies and long-term reliability improvement. ##### Part 2 of 2 ## Using Failure Data to Improve Equipment Reliability What does all this math add up to? If managers do it properly, the calculations can determine when a piece of equipment might fail or the probability of when it will fail. With this information, managers can develop [PM Optimization (PMO) strategies](https://www.nexusglobal.com/strategyopt) that will manage risk, improve preventive maintenance processes, introduce predictive maintenance technologies and ultimately reduce costs. Managers who opt not to measure, track and respond to the results are putting their organizations at risk. It has been reported that reactive maintenance can be three-four times more expensive than proactive maintenance and that 30-33 percent of a department’s average maintenance budget is wasted on poor maintenance practices. If equipment availability is lower than 95 percent, that could be a valid reason for a manager to conduct a [formal root-cause analysis (RCA)](https://www.nexusglobal.com/apmsolutions/investigation-management/investigationopt) or a failure-modes-and-effects (FMEA) analysis. Finally, in facilities with mission-critical equipment that must maintain a high level of availability and where the probability of failure is high, managers must take action to remedy the risk, such as redesigning or upgrading the component or the system. When attempting to implement a reliability culture within a maintenance and engineering department, it actually will take managers some time to acclimate department staff and front-line technicians to a new way of performing and of thinking. It is considered common that when embarking on the reliability path, maintenance costs actually increase initially. In Ron Moore’s book Making Common Sense Common Practice, he sights two studies. The first study, Ormandy’s “Achieving the Optimum Maintenance and Asset Strategy and Ensuring They Are Aligned with Business Goals,” found that maintenance costs increased by 15 percent in departments making the transition to a reliability culture, but over time were reduced by 20 percent. The second study, by C.D. Kelly, entitled “Leadership for Change: Developing a Reliability Improvement Strategy,” found the following results: - Repair expenses increased by 30 percent during the first 12-18 months, then declined to 50-80 percent below the original levels after 24 months - Breakdowns declined by 50-60 percent - Downtime declined by 60-80 percent - The spare parts inventory decreased by 20-30 percent By measuring failure rates and probability of failure, the potential could be major dividends that help managers refocus their efforts to eliminate failure, unscheduled downtime and risk. Now if I could only use this data to help me bike faster. ##### Read Part 1 of 2 [Maintenance, Measurement and Equipment Reliability](https://blog.nexusglobal.com/maintenance-measurement-and-equipment-reliability) ## FAQs ### How can organizations predict equipment failures? Organizations can estimate equipment failure probability by analyzing historical failure rates, operating conditions, maintenance records, and equipment performance data. These insights help maintenance and reliability teams identify potential failures, prioritize critical assets, and develop proactive maintenance strategies. ### What is the difference between preventive and predictive maintenance? Preventive maintenance uses scheduled inspections and maintenance activities to reduce equipment failures. Predictive maintenance uses condition monitoring, performance data, and analytical techniques to identify developing problems and determine when maintenance intervention may be needed. ### How does predicting equipment failures reduce maintenance costs? Predicting equipment failures helps organizations identify potential problems before they cause unplanned downtime. By optimizing maintenance intervals, reducing emergency repairs, and prioritizing high-risk equipment, organizations can improve reliability and control maintenance costs. ### How can maintenance strategies improve equipment reliability? Risk-based maintenance strategies use equipment criticality, failure modes, and failure probability to determine appropriate maintenance activities. Nexus Global's Strategy Optimizer helps organizations develop and optimize maintenance strategies to reduce operational risk, eliminate unnecessary tasks, and improve asset reliability.  - [Tweet](https://twitter.com/share) [![Maintenance Strategy Optimization for a Polymer Currency Printing Company](https://blog.nexusglobal.com/hubfs/Case%20Study%20CTAs/CCL%20Image%201408x833.png)](https://blog.nexusglobal.com/reduced-downtime-by-40-with-cdm/pmo-strategy-reboot) #### [Maintenance Strategy Optimization for a Polymer Currency Printing Company](https://blog.nexusglobal.com/reduced-downtime-by-40-with-cdm/pmo-strategy-reboot) [![Picture of Doug Robey | CMRP, CRL](https://app.hubspot.com/settings/avatar/956dd448a701e49e9f8bd4c5381c0b29) Doug Robey | CMRP, CRL](https://blog.nexusglobal.com/author/doug-robey-cmrp-crl) Case Study: How an improved PM Optimization (PMO) Strategy on a critical asset increased efficiency, cut costs, and reduced downtime by 40% in 90... [STRATEGY MANAGEMENT](https://blog.nexusglobal.com/tag/strategy-management) [CASE STUDY](https://blog.nexusglobal.com/tag/case-study) [MANUFACTURING](https://blog.nexusglobal.com/tag/manufacturing) [ASSET PERFORMANCE MANAGEMENT (APM)](https://blog.nexusglobal.com/tag/asset-performance-management-apm) [PMO](https://blog.nexusglobal.com/tag/pmo) [RELIABILITY](https://blog.nexusglobal.com/tag/reliability) [MAINTENANCE STRATEGY](https://blog.nexusglobal.com/tag/maintenance-strategy) [Read More](https://blog.nexusglobal.com/reduced-downtime-by-40-with-cdm/pmo-strategy-reboot) [![The Power of Preventive Maintenance in Asset Management](https://blog.nexusglobal.com/hubfs/Featured%20Images/Day-11-feat-image.png)](https://blog.nexusglobal.com/quarantined-day-11-preventative-maintenance) #### [The Power of Preventive Maintenance in Asset Management](https://blog.nexusglobal.com/quarantined-day-11-preventative-maintenance) [![Picture of Nexus Global](https://blog.nexusglobal.com/hs-fs/hubfs/nexus-global.jpg?width=30&name=nexus-global.jpg) Nexus Global](https://blog.nexusglobal.com/author/nexus-global) Reactive Maintenance costs 3-4x more than Preventive Maintenance. Maintaining assets and determining downtime using proactive strategies is essential. [PM](https://blog.nexusglobal.com/tag/pm) [MAINTENANCE](https://blog.nexusglobal.com/tag/maintenance) [PROACTIVE MAINTENANCE](https://blog.nexusglobal.com/tag/proactive-maintenance) [STRATEGY MANAGEMENT](https://blog.nexusglobal.com/tag/strategy-management) [RELIABILITY](https://blog.nexusglobal.com/tag/reliability) [MAINTENANCE STRATEGY](https://blog.nexusglobal.com/tag/maintenance-strategy) [Read More](https://blog.nexusglobal.com/quarantined-day-11-preventative-maintenance) [![Steel Finishing: FMEA → Value-Added Strategies](https://blog.nexusglobal.com/hubfs/BLOG_AMNS_SO%20Featured%20Image%20(1408%20%C3%97%20833%20px).png)](https://blog.nexusglobal.com/strategy-optimizer-supports-steel-finishing-facility-with-conducting-fmea-and-improving-reliability-efforts) #### [Steel Finishing: FMEA → Value-Added Strategies](https://blog.nexusglobal.com/strategy-optimizer-supports-steel-finishing-facility-with-conducting-fmea-and-improving-reliability-efforts) [![Picture of Larry Olson | CMRP, CRL, CAMA](https://blog.nexusglobal.com/hs-fs/hubfs/larry_olson.jpg?width=30&name=larry_olson.jpg) Larry Olson | CMRP, CRL, CAMA](https://blog.nexusglobal.com/author/larry-olson-cmrp-crl-cama) How a leading steel finishing facility used FMEA + Strategy Optimizer™ to create value-added maintenance strategies and strengthen reliability. 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