Many facility managers and landlords are turning to new options when it comes to a building’s equipment. Rather than buying the equipment outright, buildings are leasing critical mechanical equipment. The thinking behind the relatively new business model is that the original equipment manufacturers (OEMs) are able to operate and maintain these increasingly complicated machines better than on-site building teams. This is similar to car dealers selling maintenance packages with the new car purchase. The new take on machine health looks to build a world where building teams can focus less on equipment in the property and more on the people.
One of the manufacturers pursuing this strategy is Carrier. Founded in 1915 to provide HVAC parts to buildings it eventually grew into a $19 billion company with 53,000 employees worldwide. Now they are launching a maintenance-as-a-services platform called BluEdge. Essentially Carrier offers cooling-as-a-service, leveraging the expertise of its own products to take over operations and maintenance of its products. Carrier commits to 24/7 coverage of its products, in some cases taking the burden of service level agreements from landlords. As products become more advanced, OEMs in all industries are maintaining a tighter grip on their products. Commercial facility management and maintenance deals are not new, OEMs are taking out the middleman, bringing those services in-house. Facility managers are starting to see the benefits.
“I think in general, when we look at the commercial industry, one thing we’re seeing is a move to equipment as a service model,” said Saar Yoskovitz, CEO at Augury. “The reason a facility buys a pump isn’t that they like doing maintenance. We’re seeing more and more services being taken over by the OEM,” Saar is developing and deploying a full-stack platform that digitally manages machine health in several industries, including commercial property management, where the company recently partnered with Carrier to incorporate Augury’s machine health technologies into the Carrier BluEdge Digital services offering. “We’re seeing large machine manufacturers adopt this model for chillers, pumps, and cooling towers. I will bet that chiller OEMs will take over the utility room.”
Last year Carrier became an independent company, separating from United Technologies. Carrier CEO Dave Gitlin comes from the aerospace industry, which has gone through its own similar revolution. Companies like Rolls Royce and GE pioneered the concept of selling flight hours instead of engines, having clients lease their equipment, taking full ownership through the machine’s lifecycle. Just months after Carrier’s separation, Gitlin and the company launched the BluEdge service platform around the same concept.
“With the BluEdge service platform, we’re providing our most comprehensive service offering to enable Carrier and our customers to realize the benefits of connected devices and the Internet of Things to enhance efficiency and performance, lower costs and improve building health,” Carrier CEO Dave Gitlin said.
The new approach is a fundamental shift in facility management. Instead of monitoring equipment and scheduling specialists, OEMs monitor their own equipment and tell the property when they need to make an on-site visit. The model doesn’t take agency away from on-site staff since they’re primarily responsible for simpler maintenance. For larger systems with critical equipment, special techs are needed. The difference is who makes the call. For property staff, the biggest change is more equipment ‘up-time’ and fewer surprises.
Trust is important in every vendor relationship but it is critical for maintenance-as-a-service. Facility managers are putting more control in the hand of vendors, who can obfuscate the process and prices. Everyone knows to be wary of car mechanics trying to charge you for work you may not need. That instinct sets off alarm bells for some managers and engineers responsible for multi-million dollar assets filled with expensive mechanical equipment. There’s a direct financial incentive for OEMs to require more of their own service to be wary of. But, on the flip side, there’s also a direct incentive to prove their service is valuable, which means reducing maintenance and increasing up-time.
Predictive maintenance isn’t a new concept. For nearly two decades the Department of Energy has been making the case for the importance of predictive maintenance, stating predictive machine maintenance can improve energy efficiency by up to 20 percent. When equipment isn’t functioning properly, it has to work harder, using more energy. Scheduled maintenance can also be wasteful if the equipment is still in good working order. Predictive maintenance is in large part condition-based maintenance, using sensors and data to better understand the condition of equipment and when it needs to be repaired or replaced. Digital machine health is making predictive maintenance easier.
Augury is bringing its AI-based machine health technology developed on industrial production lines to the world of commercial real estate. Using a database of over 80 million machine hours, Augury is crowd-sourcing mechanical data. An on-site tech can use their smartphone to do a vibrational analysis of a machine by placing their device on the equipment. The data the phone collects is compared against the data set and Augruy’s platform diagnoses the issue. It sounds complicated but the basic concept behind the process is the same as a car mechanic. When a car has a fan belt issue, a mechanic can hear the problem as soon you pull up whether you’re driving a Toyota or Mercedes Benz. Different problems have different patterns, Yoskovitz explained. If you can understand the patterns, you can better diagnose the problems.
Bringing this innovation into the world of commercial property management isn’t easy. Buildings are very unique assets, unlike most equipment they don’t roll off an assembly line. Augury’s standardized data set tackles that problem with scale. The platform can pre-build models for different machine types and product lines. The system has 20,00 different pumps alone in the database.
“The goal is to change management. The hardest thing isn’t creating the technology, it’s to get engagement and adoption.” Yoskovitz said. “That’s the biggest piece of digital transformation. Our goal is to make it as streamlined and seamless as possible.”
Maintenance-as-service has been mostly limited to the retail world, where products are smaller and more manageable at scale. But it might only be a matter of time until this schema bleeds into our built world. As the technology improves and buildings get smarter, the focus of facility managers is shifting to delivering better outcomes. By involving original manufacturers in the maintenance and operations of their products, office mechanical and utility rooms are becoming more efficient. This could be a start of a new era of building maintenance that will shape the role of facilities manager and their relationship with equipment manufacturers.