Integrated Service Models: A Cost-Effective Way to Maintain Equipment for Smaller Labs

Just as there are a variety of options to choose from when selecting an instrument, there are a variety of ways to maintain them. One such option is the integrated service model, which seems to work best for a lab of our size, whose ouput is approximately one thousand samples a day.

In the realm of life sciences, equipment isn’t cheap. The purchase of two hybrid triple quadrupole/linear ion trap systems — “Q Traps” — earlier this year cost our laboratory nearly one million dollars alone, a pricey but necessary move to fulfill increased client demand and improve quality and turnaround time. Assuming the normal growth rate of any lab is eight to ten percent in net revenue, most will make just one major instrument purchase a year. Therefore, emphasis is placed not on obtaining new instruments but properly caring for those already hard at work in production.

The epitome of flexibility

When it comes to product maintenance, an integrated service model is the epitome of flexibility. Rather than selecting one method by which to care for all production equipment, subscribing to an integrated approach allows lab managers to determine an instrument’s level of protection based on a machine’s unique characteristics. Newly marketed instruments and those on the brink of extinction have different roles in production and thus different maintenance requirements, something a blanket “one-size-fits-all” attitude can’t sufficiently address. Also, exploring different options can often mean big savings on the overall bill, especially in the case of third-party service vendors, who usually offer price breaks to labs that sign a contract for multiple instruments.

Integrated service models are not to be confused with instrument service delivery (ISD) models; that is, when a third party places someone on-site to perform necessary maintenance. In that situation, the ISD provider serves as the sole point of contact for any type of service taking place in the lab; with an integrated service model, the lab manager calls the shots.

How it works

AIT has followed an integrated service model for years, relying on a combination of original equipment manufacturers (OEMs), third-party vendors, and in-house maintenance. For each piece of equipment, a service model was chosen based on a variety of factors relating to the capabilities of the instrument, the manufacturer, and our staff.

For instance, in the case of our two Q Traps, we maintain an OEM contract. The rationale? Q Trap technology was introduced into production this past spring and is now our workhorse for all opioid and benzodiazepine urine confirmations. The instrument’s sensitivity allows us to measure analytes more simply, thereby cutting our extraction time in half and saving the company $25,000 a month in overall costs. We can’t afford to have them out of the production loop for longer than a couple of hours, so it’s worth the extra money to enlist the help of the original manufacturer to get it repaired quickly. The manufacturer will have immediate access to replacement parts, research and development staff, customer service information, and other matters that could take one of our lab managers an entire day to work through, a costly expense in and of itself. In addition, Q Traps haven’t been on the market longer than a few years; most third-party vendors and inhouse production managers simply don’t have the knowledge required to provide adequate service.

Other reasons for signing on with the manufacturer include instrument software safety codes to which only they have access and qualifying an instrument for special analysis.

(One piece of advice: Before you sign on the dotted line, check to see if the piece is still under warranty. If it is, you won’t need to purchase any kind of contract until the warranty expires.)

For our GC-MS equipment, AIT calls upon a thirdparty vendor, mainly because the technology has been around for decades and there’s a wider pool of vendors capable of servicing them. There are some pieces on which we don’t carry any type of service contract at all, like our spectrophotometer, refractometer, and some HPLC systems, because our staff can service them internally. You may also forgo a service contract on instruments where the technology is being phased out of production. In that case, the money designated for a service contract might be better spent on a brand-new instrument.

This integrated approach to instrument maintenance has worked well for AIT. Each instrument has the level of care appropriate for its role in production, and our lab administrators are spared the time and effort it takes to service equipment outside their expertise. However, it can be difficult to determine which instruments would benefit from specialized care, which pieces could be properly maintained under a single third-party contract, and which ones aren’t worth the bother. Then there’s the task of managing each contract. The time commitment alone may outweigh the benefits.

Then again, if done correctly, an integrated service model can save the company a considerable amount of money in operating costs, not to mention a lot of aggravation.

Services covered

When it comes to a third-party vendor, service contracts are typically designed to cover any high-level preventive maintenance that would normally take internal technicians an extended period of time to perform, as well as any repairs your employees aren’t qualified to handle. You’ll also want to include parts that aren’t considered consumable — i.e., any permanent parts that typically don’t require any sort of repair.

Services not covered include daily maintenance and normal wear-and-tear. It’s similar in theory to auto insurance — you pay a thousand dollars a year in comprehensive coverage because you want to protect your investment against significant damage in an accident or natural disaster, not score free oil changes and tire rotations.

The integrated model in action

Several years ago, AIT purchased a service contract with a third-party vendor for an HPLC at a price tag of $3,000 per year. After one year of ownership, the instrument’s pump head suddenly stopped working, a part that normally would have taken $3,000 to repair. However, since it was covered under the terms of the service agreement, the part was replaced at no charge. Factor in consultation and labor charges that would’ve accrued had the matter been handled internally, plus the extra time it would’ve taken for an employee to perform such high-level maintenance, and the service contract has paid for itself and then some.

If the analysis is rigorous and decisions are made well, most service contracts will yield similar results. In the event this is the first time you’re considering an integrated model and are hesitant to make a year-long commitment to a third-party vendor, or if it appears that one of your instruments will no longer require high-risk repair, be sure to work with a vendor willing to negotiate a shorter period of time (usually six months). The contracts themselves are a little more expensive, but the peace of mind they’ll give you is priceless.

Who will benefit?

Companies that offer a broad spectrum of testing and therefore require a variety of instrumentation — usually smaller companies — stand to reap the largest benefits from an integrated service model, as well as any company willing to increase risk as a means to cut costs. AIT uses instruments like the GC-MS, LC-MS, HPLC, LCMS/ MS, and a host of others because of the breadth of testing we do. It makes sense that a lab such as ours would be attracted to a more flexible model. On the flip side, a laboratory with a narrow focus and little to no variation in instrumentation will most likely fare better with traditional service contracts maintained by the original manufacturers.

For those labs interested in exploring their options, though, a word of caution: In order to implement this model successfully, a great deal of time must be dedicated to researching the needs of each instrument and the different service plans offered by OEMs and third-party vendors, so you can accurately compare the pros and cons of each in relation to every piece of equipment you have. Then, you’ll need to spend the same amount of time investigating potential vendors to make sure you’re getting the best deal.

Selecting a third-party vendor

As with any service provider, all third-party vendors are not created equal. Each must be evaluated against a series of criteria, including but not limited to cost, contract options, technical knowledge, quality of service, response to call time, parts inventory, and local reputation. A vendor with impressive technical knowledge is no good to you if the company’s closest technical service representative is six hours away; likewise, a vendor with easy access to parts means nothing if the staff lacks the skill to install them.

Also pay special attention to a particular provider’s accreditation. You want a vendor to be accredited by the original manufacturer of the equipment you want serviced.

Conclusion

All laboratories are different, and a business practice that proves successful for one may be disastrous for another. Only you know what’s going to improve production in your particular facility. However, if you’re the type of lab that likes to save money, the integrated service model may be worth your while.

Shelby Davis III, Andrea Terrell, Ph.D., DABCC, and Breain Ma’Ayteh Dunscombe, MA are employed with the American Institute of Toxicology, Inc. (AIT Laboratories); www.aitlabs.com.

Categories: Laboratory Technology

Published In

Big Labs, Small Labs Magazine Issue Cover
Big Labs, Small Labs

Published: January 1, 2007

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