Larry Wash & Matt Pike – June 29th

Understanding Equipment’s Life Cycles and

How Safety Improves Tenant Satisfaction

Copyright KONE, Inc. 2015

Agenda

Using Risk Mitigation

Assessments to Improve Safety

Understanding Equipment

Lifecycles

KONE in Brief

Todays Speakers

How to Best Manage an Aging

Asset

Summary

Today’s speakers

Larry Wash Executive Vice President,

KONE Americas

– Expertise: Senior executive

with extensive experience

running global organizations

and growing multi-billion dollar

businesses.

– Areas of focus:

Business strategy

Change management and

transformation

Operational improvements

Thought leader in energy

services / sustainability

3

Matt Pike Manager, KONE Customer

Based Risk Management

– Expertise: Corporate manager

focused on developing risk mitigation

practices with extensive field

experience.

– Areas of focus:

North American customer safety training

Customer risk assessments

Safety auditing systems

Safety implications in People Flow®

4

KONE in brief

KONE

– Industry-leading elevators and

escalators company. Our services

cover the entire lifetime of

a building, from the design phase to

maintenance, repairs and

modernization solutions

Quick facts:

– KONE Americas includes Canada,

Mexico and the U.S.

– 65 branches across the geography,

around 5,500 employees

– Approximately 2,300 of our employees

are technicians

Understanding Equipment Life Cycles

1 July 2015 5

Aging Buildings in the United States

15-19

~200 ~250

~2,000

+25

~100

20-24 10-14

High number of aging high-rise buildings

Over 50%

Total US

installed

base

Of which

at least 20

years old

~1.0M

Installed elevators and escalators

base is aging

Number of buildings with 25 or more floors by age

(building age in years)

6

Over half of all elevators and escalators are beyond the end of their useful life

span, which creates reliability challenges for property managers.

How To Best Manage Your

Aging Assets

Managing Your Aging Assets?

8

Why is it important to think about an asset management plan?

Analyze Plan Update

An asset management plan is a comprehensive analysis of

your equipment designed to prepare for future enhancements

in a systematic manner that focus on key areas:

Code

Safety

Accessibility

Eco-Efficiency

Reliability

Aesthetics Performance

Asset management planning is a critical life cycle management tool

that can help you prioritize elevator and escalators needs.

Expecations of an Asset Management Plan

A building owner / property

manager should expect an Asset

Management Plan from their

service company

A living document that can

change with the needs of the

building

Smarter investments with the

biggest impacts

9

Asset Management Plans align goals to

equipment needs to prevent downtime.

Focus Areas: Dealing with Aging Equipment

10

How can performance and reliablity in an assest management plan

benefit your building?

Code

Safety

Accessibility

Aesthetics

Eco-Efficiency

Performance

and Reliability

• Door equipment

• Addresses issue that

cause call outs or

shutdowns

• Improving tenant

satisfaction

Focus areas provide solutions to chronic problems, that can help

increase your uptime and reliability.

Focus Areas: Dealing with Aging Equipment

11

How can safety in an assest management plan help reduce potential

end user risk?

Code

Safety

Accessibility

Performance

and Reliability

Aesthetics

Eco-Efficiency

• Door restrictors

• Stops unauthorized

access to the

elevator hoistway

• Immediately

improves safety

Safety actions provide immediate benefit which brings peace of mind and

reduces liability.

Using Risk Mitigation Assessments to

improve Safety and Reduce Liability

Risk Mitigation Assessments

What is a Risk Mitigation

Assessment?

Targets safety items that help reduce

risk and liability

Helps an owner / property manager

prioritize equipment needs

Written report that defines items

identified during asset management

planning to make more impactful

decision.

13

A risk mitigation assessment is a

roadmap to help prioritize assets based

on risk and liability exposures.

Risk Mitigation Assessments – Understanding

Potential Risks

14

Why is it important to think about a Risk Mitigation Assessments?

Code Safety

Upgrades

Site

specific

issues

Safety

Training

Crowd

Control Modernization

Risk Mitigation Assessments allow owners / property managers to

make the best informed decisions.

Detailed report to help an owner / property manager understand

and create a holistic approach to equipment management.

Focused Analysis: Site Specific issues

Risk Assessment

Recommendation

– Moving displays that

attract children away

from equipment

– End user education on

how to properly use

equipment

– Identifying outside

factors that create

liability exposures

15

Risks identified

– Attractive nuisances

– Equipment misuse

– Outside factors that

impact equipment

Reviewing a site from a risk reduction standpoint helps exposure site

specific risks that maybe non-elevator / escalator related.

Site

specific

issues

Focused Analysis: Customer Training

Safety Materials

– Owner safety training

– End-User flyers

– Equipment specific

training

16

Safety

Training

Having a strategy on addressing end-user and employee training helps

reduce liability exposures.

Focused Analysis: Safety Upgrades

Aesthetics Items

– 2 elevator Asset

Management Plan

provided

Cab upgrades =

$40,000

– Overall benefit is

superficial and does

not address

mechanical updates.

1 July 2015 17

Safety / Code Items

– 2 elevator Asset

Management Plan

provided

Door restrictors = $15,000

Safety Door edges =

$10,000

Reduced cab upgrades =

$15,000

– Same investment

addresses safety, reliability

and aesthetics.

Prioritizing an owners / property managers goals with professional elevator

and escalator equipment planning addresses multiple needs.

Safety

Upgrades

18

Summary

• Aging equipment base

Over 50% of all elevator and escalator

equipment is at or beyond the end of

their useful life cycle

• Asset Management Planning

Having a plan in place helps prepare for

the costs associated with safety

upgrades, modernization, and other

associated costs

• Risk Mitigation Assortments

Integral part of an owner / property

manager strategic plan for the future

Proactive management of your assets

reduces the likelihood of unforeseen

expenditures .