# More cost-efficient way to get measurement results: The most important cost saving potentials for your test and measurement equipment are found in installation and operation

You think about using new test and measurement equipment? Do not only consider the purchase price of the products. Operating and installation costs harbor considerable savings potential. Some "bargains" quickly prove to be an expensive acquisition resulting in substantial subsequent costs. This article tells you which factors you need to consider - and how you can calculate the actual costs.

In fact it is a simple sample calculation. Assuming you want to buy a new multi-channel measurement system that you want to use over the next seven years. And assuming the instrument would cost € 10,000 - would this be the final costs of your test equipment?

Of course not. There will be considerable additional costs - in many cases they are not specified on an invoice or in a quote. Time and effort are involved in specifying the measurement task and the requirements for the test and measurement equipment. Including all coordination and research the effort may well amount to one week. The resulting costs assuming 40 hours and an average hourly rate of € 70: € 3,000.

Implementation and training for the new instruments need to be considered in addition. This includes, for example, electrical and mechanical integration and the connection to test bench automation systems. This, too, can easily total 60 hours (1.5 weeks). Considering our hourly rate, this would amount to another € 4,000. The operating costs would have to be considered in addition: Configuration, adaptation, evaluation over a service life of seven years - the expenses accrued, even when allowing for one hour per week only, amount to € 13,000 (calculated for an equipment utilization level of 50 percent).

Finally, there is a cost pool of € 30,000 - with the mere purchase price of € 10,000 being relatively moderate.

## The mere purchase price represents the smallest cost pool

The calculation uses hypothetical figures, however, based on actual values. Irrespective of the concrete calculations, one thing is obvious: The total cost of operating and purchasing test and measurement equipment far exceeds the actual purchase price. This is what "Total Cost of Ownership" (TCO) actually means. TCO is more than pure economic theory. When taking their decision to invest, companies worldwide increasingly shift their focus from the mere cost of purchasing a product to the total cost arising during the use of equipment. This approach in particular applies for investment decisions in measurement technology.

Technical services - for example starting up test equipment or even taking measurements - are increasingly outsourced and no longer performed in-house. Test and measurement expertise often is no longer available in the companies. New usage concepts play an important role: Test and measurement equipment is used in an increasingly wide range of applications and test and measurement projects. This results in additional costs that need to be taken into account. "Internal", indirect costs for working time that have been accepted in most cases so far are now being looked at more closely - in times of scarce resources this has become a very important aspect.

## How can the total cost be reduced?

However: How can the Total Cost of Ownership of test and measurement products actually be defined? And, even more important: How can these costs be reduced?

In general, the structure of the TCO depends on the application and cannot be calculated using a standard formula. One thing is obvious: The TCO should include all costs accrued during the life cycle of the measurement task. This includes hardware and software, services, engineering tasks and internal costs arising in your company prior to, during and after starting up the test and measurement equipment.

In general: The purchase costs, also called "CAPEX" in the specialist jargon, in general do not represent the biggest proportion of the TCO. However, the CAPEX often determines the decision to buy: Different quotes are compared and the supplier offering the lowest price is awarded the contract. No great savings can be achieved here. The implementation (IMPEX) and operating (OPEX) costs offer far greater potential for cost savings.

This is confirmed by our sample calculation. Assuming that the purchase price of a multi-channel measurement system is € 10,000, potential cost savings can be expected to amount to between € 1,000 and 2,000, provided that there are very cheap suppliers on the market. CAPEX savings (purchase price) bring the short-term pleasure of having made a good bargain. However, the huge cost pool amounting to € 20,000 is generated by implementation and operation (IMPEX and OPEX). The potential for cost savings is significant here and far exceeds the potential offered by the CAPEX.

Critical success factors for substantial cost savings in the purchase and operation of test and measurement equipment are:

• Optimal consultancy and preparation of the purchase of test and measurement equipment
• Use of modern control concepts (usability)
• Maintenance at regular intervals or when required.

## Are you using the right system?

### Optimal consultancy and preparation of the purchase of test and measurement equipment

The world of measurement data acquisition is experiencing radical changes. Smaller, more compact, more flexible - these are some of the current technology and market trends. The range of measurement technology systems for your tasks is becoming broader as well. On the one hand this is an advantage, on the other hand it increases the risk that you buy a system that is not optimally tailored to your tasks - and therefore generates additional costs for purchase, startup, setup times and use.

We recommend: Comprehensive advice before purchasing. Benefit from the knowledge available through the HBM measurement technology experts at an early stage: Our experts help you to make the right choice for all the components of your measuring chain through target-oriented analysis and broad application know-how:

• Transducers and sensors
• Data acquisition systems
• Software.

As a provider of all components of the measuring chain from a single source HBM guarantees the interoperability of the components and saves you the effort of choosing the right system and setup.

"Application Engineering" plays an increasingly important role as well: HBM engineers and technicians work on an appropriate solution for the integration of test and measurement equipment at your premises. Your advantage: No training and engineering effort is required at your company.

## Use of modern control concepts:

### Minimizing high costs resulting from operating errors

With technology becoming ever more complex, it is essential that operation becomes increasingly easy - otherwise the user would get lost in prolonged introduction and parameterization work. If you really want to save costs, trust in products offering high usability, i.e. a high degree of user-friendliness. Test hardware and software solutions up front and put their usability to the test.

Usability pays off: Users won't need long to learn how to use a measuring instrument but can draw upon well-known operating concepts. This is an important factor, because the number of staff working with a measuring instrument is increasing - and in many cases involves non-experts. And, in addition: Usability reduces costs because it prevents operating errors and therefore the recording of incorrect test results.

Usability in measurement technology therefore is more than extra convenience for the user. Usability is the best way to achieve cost savings.

HBM has been striving to implement maximum usability in its products for many years. For example, the QuantumX amplifier automatically identifies all transducers that are connected - without the need for additional parameterization or setup which normally is required with other amplifiers. HBM's software solutions, too, use well-known operating and control concepts and help the user to get test results and reports in few seconds.

## Maintenance at regular intervals or when required:

### Minimizing down time

Reliable and traceable test results are prerequisite for assessing the quality of a measurement. Requirements-oriented maintenance increases the availability of the system and reduces costs that would result from unnecessary maintenance processes.

A smart maintenance concept is forward-looking - and enables you to significantly reduce down time. A huge cost benefit.

When purchasing new test and measurement products remember to consider using corresponding service concepts. HBM provides, for example, a number of matching service offerings for regular, preventive or requirements-oriented maintenance.

Furthermore, HBM's portfolio of services includes remote or on-site support, practical technology trainings and project management.

## Sample calculation

What is the benefit to you? Let us look at the cost pools of our sample calculation once again:

The expenditure for specifying the measurement task and the requirements originally amounting to 40 hours (= € 3,000) can be reduced to one work day of 8 hours - by using the consultancy provided by HBM. You get a "tailor-made" suggestion for the appropriate measuring system. Costs are reduced from € 3,000 to € 600.