June 08, 2016
Concurrent Pricing and Your CMMS
So, your team has decided to invest in a top notch Computerized Maintenance Management System (CMMS) in order to gain a significant productivity advantage while lowering operating costs. After all, there is really no profitability avenue left other than to shut the doors and move to an exploitation-level labor market. So, the decision has been made. Bring in a quality CMMS with a reputation for boosting maintenance productivity, big savings through smart inventory management and eliminating equipment breakdowns that idle the production line. So far, so good.
The only remaining question is, how do you keep your investment in a CMMS as reasonable as possible? Through thorough review, your team has already narrowed the CMMS vendors to a handful of experienced choices. Pricing is another matter. What you did not expect was the widely varying price points available. As you might expect, the "big-name boys" in application development arrive with an investment cost that imposes a significant burden on expected cost savings. Paying too much to the vendor for use of the CMMS application slashes the expected gains the operation can realize from implementation.
If there is one fact about application developers and their pricing methodology it's that they charge users by the "seat". Whether you need graphic design software for your marketing department or accounting software packages for the finance department, pricing is always predicated on the number of users, or "seats". For the most part, CMMS software is no different. Most CMMS software vendors charge by the number of users, sure. But, what if there was a quality CMMS vendor who realized the advantage to both parties by pricing, not for every user who has rights to use the software, but by the number of "seats" using the software at the same time?
That's the essence of "concurrent pricing". You have 25 personnel in your maintenance department. All of them need to use the software during the workday, but not all at the same time. After all, your maintenance staff is primarily tasked with performing maintenance tasks not typing information into a CMMS. So, perhaps you only need 5 "concurrent users' at any one time. When one user is "offline" another has open access to close out a work order. Then, that user is offline and returns to his or her preventive maintenance tasks.
Let's face it, flat fee pricing that bases its charges on your entire universe of possible users of your CMMS software is a very lucrative pricing model - for the software vendor. Your cost objectives should be quite different though. This pervasive flat-fee per user pricing method does not help your ROI for this project and makes the purchasing decision much more complex.
One company that has been creating CMMS software since 1982 when business computing was in its infancy is Mapcon Technologies, Inc. We spoke to Joel Tesdall at Mapcon about its "concurrent pricing" model. "We've been doing this for a long time and we are expert at designing what I believe is the best CMMS on the market. Concurrent pricing is one of the ways that create real value for our customers and substantially differentiates us from other, larger players in the CMMS market."
Similar to other technologies, CMMS software has come a long over the past several years. CMMS has taken full advantage of mobile devices and optical character recognition technology (e.g. barcoding) which has significantly advanced efficiencies in staff productivity and inventory management. If your organization doesn't use CMMS, it may be high time to look into it! Just remember, like everything else, you may need to carefully review your cost options. And, make sure you take advantage of concurrent pricing!