Build up your asset-based budget (OPEX) and put yourself in the driver’s seat. If corporate leaders forecast a different budget, you can then give solid arguments why that budget might not suffice to reach asset performance targets. You can also more easily prioritize and explain choices to leadership in this way. To be able to do this you have to have the foundation in order. Have the insights into your asset condition, know which equipment is critical for production, and know the risks involved.
OPEX and CAPEX spend are of course linked. Our advice is to make sure you plan for CAPEX investments to safeguard a stable asset health. We often see an outlook that is too short, for example, two years. If you need to replace the asset in fifteen years because that’s the original end-of-life of the asset, then you need to plan until that time. By doing this you will avoid a CAPEX backlog pile-up which can negatively impact the availability of the asset due to outages.