Maintenance is defined as a process in which working condition of plant or machinery is maintained at the optimum level as to give maximum output. Maintenance is done through repair, partial replacement and total replacement.

Following is the significance of the maintenance policy:

1) Maintenance Service ensures that equipments are always in ready and reliable condition. This ensures company is able respond to any sudden change in demand.

2) Maintenance Service ensures that equipments are always calibrated to provide good-quality products and competitive advantage. This ensures that there are no sudden and frequent breakdowns and reduce production of defective products.

3) Maintenance Service ensures that there are no major breakdowns. This ensures there is no lose of inventory or market share for companies following JIT philosophy. Maintenance Service ensures that costs are always controlled.

4) Maintenance Service is particularly important in capital-intensive industries.

If organizations are not able to implement an effective maintenance policy than it can result in the following results:

a) Full capacity utilization may not be achieved.

b) Increase in production cost as fixed labor cost cannot be reduced.

c) Increase in maintenance cost as more spare parts are required.

d) Reduction in product quality and increase in wastage.

e) Safety of workers and operators in jeopardy.

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