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How To Determine CMMS ROI for Your Company

Published On December 5, 2023     |     5 Min Read


The stakeholders of a company that invests in a computerized maintenance management system should know how to calculate the return on investment for this software. Using a CMMS can reduce downtime by up to 25%, increase productivity by up to 15%, reduce maintenance costs by up to 55% and enhance equipment life by up to 20%. Find out how these savings factor into CMMS ROI and how to maximize the ROI on a CMMS.

How To Calculate CMMS ROI

The best way to determine whether a CMMS is worth what you spend on it is to calculate the return on this investment. You will need to arrive at a specific figure for the value of a CMMS and subtract the costs before dividing the difference by the costs of a CMMS. In equation form:

ROI = (CMMS Value – CMMS Costs) / CMMS Costs

Find out what factors into the value and costs of a CMMS. Once you determine each of these values, you will be ready to calculate the ROI for CMMS software.

CMMS Value

Several metrics are useful for determining the value of a CMMS. Here are the factors you should consider when calculating CMMS value:

  • Asset efficiency: How much more efficient is asset utilization with a CMMS?
  • Asset lifespan: How much longer should assets last with preventive maintenance?
  • Downtime: How much does using a CMMS reduce downtime?
  • Overtime: How do rates of overtime compare before and after implementing a CMMS?
  • Productivity: How much less time do tasks require since implementing a CMMS?
  • Inventory: How much does managing inventory in a CMMS reduce inventory costs?
  • Utilities: How much does a CMMS save on utilities by promoting maximum efficiency?

Assessing the total value of a CMMS entails many calculations for determining the value of each of these metrics. It’s easier to calculate CMMS value and CMMS ROI if you have access to data dating back to before implementing this software.

CMMS Costs

Assessing the costs associated with a CMMS is more straightforward. There are four main types of expenditures to consider:

  • Implementation cost: Multiply implementation time by the average hourly wage.
  • Onboarding cost: Multiply working hours by the number of users and average wage.
  • Hardware costs: Add up any expenses for on-premises hardware or mobile devices.
  • Software costs: Multiply the number of users by the license cost and months of use.

By adding up the specific types of costs associated with deploying and using a CMMS, you will arrive at the total CMMS cost. Once you know the value and costs of this software, you have the figures you need to calculate the ROI for a CMMS.

Solutions To Maximize CMMS ROI

Your company can maximize ROI by implementing the most useful features of a CMMS. Using DreamzCMMS to manage work orders is one big step towards eliminating inefficiencies and reducing downtime, but we have more to offer. We also provide RFID-based solutions, resources for automating preventive maintenance and a business insight dashboard for tracking key performance indicators. Schedule a demo to find out DreamzCMMS can deliver the best CMMS ROI.


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