Case Studies

A Targeted Deductible Approach: EMS programs respond to your unique needs
Vendor Competition Improves Performance
Product Growth and Flexibility: EMS grows with your organization

A Targeted Deductible Approach: EMS programs respond to your unique needs:

A Financial Institution in southeast Michigan was confronted with the difficulty of maintaining 65 ATMs of a variety of makes and models, in multiple states. The ATMs were serviced by four vendors for hardware and first line maintenance. The organization was determined to unify the management and maintenance of its ATMs with the target of reducing the overall cost of ATM maintenance.

In response, a targeted deductible program was established for ATMs that applies a shared risk approach. Deductibles are based upon historical and actuarial experience provided by EMS. The organization immediately benefited from the budget protection of a maximum cost threshold. In addition, the organization gained "hands on" knowledge of each vendor's performance, parts pricing and responsiveness - ultimately selecting one vendor to service its entire multi-state ATM network.

After adopting the targeted deductible plan, the organization was able to reduce overall costs by more than 30% in the first year. ATM "up-time" also improved because the organization utilized one vendor from the preferred vendor network; consolidating all hardware and first line service.

After the first year, maintenance costs on ATMs was further reduced at renewal and the organization benefited from long term cost control over what had previously been a volatile class of equipment before using the equipment maintenance product.

Vendor Competition Improves Performance:

A Financial Institution based in Michigan's Upper Peninsula has 25 ATM locations. Many of the ATM's are located in remote areas and are subject to harsh winter weather. Over time, the cost of the service contracts delivered by the OEM increased, but service performance deteriorated. It was challenging for the Financial Institution to find viable service alternatives because of its remote location.

Equipment maintenance management was used as an option to introduce the Financial Institution to an alternate vendor from a network of preferred vendors. The Financial Institution selected the Dollar-One Solution and was able to choose the ATM vendor with the best capacity for service without the constraints of a service contract. The EMS program allowed the Financial Institution to work with many other alternative vendors for other types of equipment, providing a seamless maintenance and management solution across many equipment types.

The Financial Institution now achieves the level of service it requires at the lowest possible cost and continues to work with the vendors of its choice. Overall, the equipment maintenance solution reduced maintenance costs by 30% over the past 8 years and extended the lifespan of the equipment covered.

Product Growth and Flexibility: EMS grows with your organization

The equipment maintenance products provide your organization with the flexibility to meet your specific needs as business conditions change. Consider a Midwestern bank with an asset size of $1.5 billion, 32 branch locations, and a facilities manager who has successfully transitioned from traditional maintenance contracts to equipment maintenance programs using a first dollar coverage product. After using this product option for several years with much success, the facilities manager is asked by the Board of Directors to deliver additional savings beyond those normally provided at the annual renewal. The solution? A self insured aggregate retention.

Using a self insured aggregate retention, the organization selects an aggregate retention or total dollar amount that will be retained by the organization to pay for equipment breakdowns or preventive maintenance losses. This aggregate retention is usually an amount that approximates 85% to 95% of the total average equipment breakdown losses for a three to five year period. The retention acts like a deductible that establishes the total out of pocket costs for the organization. The retention is backed by a small equipment maintenance program that provides further protection in the event that losses exceed the retention.

For the $1.5 billion dollar Midwestern bank, this solution extended the benefits of equipment maintenance programs while delivering additional cost savings. Benefits included choice of vendors, access to EMS's "preferred" vendor network, administrative support for the maintenance of equipment schedules including preparation of a monthly web based version of the schedule for distribution on the bank's intranet, and the financial backstop afforded by the equipment maintenance program. The bank's out of pocket expenses were predictable, but more importantly, capped at the self insured aggregate retention.

And most importantly for the facilities manager, the cost savings provided by the retention more than exceeded the Board's requirements. To date, the bank pays less in equipment maintenance costs for more equipment at more locations (now numbering 44 branch offices and over $3 billion in assests) than it paid under traditional maintenance contracts at fewer locations. Flexibility and responsiveness to your business needs. Superior service. Cost savings. That's the power of the EMS solution!

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