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This paper seeks to study maintenance policies on a plant‐wide level. It focuses on the effectiveness of condition‐based maintenance (CBM). It highlights the role of the production context and the importance of using appropriate metrics to assess CBM.

A simulation model was developed to explore the effects of production context using traditional performance indicators (costs and availability of each piece of equipment) and a more comprehensive metric (line efficiency).

The results showed that CBM has the best performance among other PM policies in loosely coupled processes. By contrast, in tightly coupled processes, CBM has a negative effect on the production line efficiency because it increases equipments' blockage and starvation states.

The simulation model was developed to reflect the reality. Nevertheless, some assumptions have been used to develop the conceptual and computerized model, which can be explored further in future research.

The idea of this paper originates from empirical findings of fellow researchers. The findings in this paper provide a better understanding of how CBM affects key performance indicators in different production contexts and therefore help managers to appropriately execute CBM programmes.

This study focuses on CBM from a new angle. The majority of the literatures on condition‐based maintenance either discusses pure technical issues, or focusses on single equipment only. In this research, the effectiveness of CBM for two processes is studied and CBM is compared with block and age‐based replacement policies using a comprehensive performance indicator.